Compliant Exit Bags
Order Fulfillment (Post-Delivery)
• Once the delivery business vehicle is in the locked and secured area designated for that purpose, the lockbox inside of the delivery business vehicle will be opened by delivery business personnel.
• The Inventory Control Specialist will perform a visual verification that the lockbox is in fact empty and contains no leftover cannabis products from a previous delivery business. If there is cannabis, it will be removed from the vehicle, identified, recorded and placed in the vault for either reshipment or in the case of a cancelled order, the box seal will be cut, the contents verified as being un-tampered with and then re-stocked into inventory and recorded as
EXIT PACKAGING
ELEMENT 7: DELIVERY PLAN
being re-stocked, including time, date, amount, package numbers, weights, employee performing the re-stocking and reason for the return of the product.
Any product that has been tampered with will be accounted for and then destroyed in accordance with Element 7 procedures.
• Any cash payments received by the Driver will be logged, accounted for, signed and held in the cash register until the end of the shift or day, at which point it will be counted and locked in the Walk-In Vault.
Delivery Receipts ● Element 7 will prepare both a hard copy and an electronic delivery request receipt for each delivery of cannabis goods. The delivery request receipt will contain the following:
1. The name and address of Element 7;
2. The first name and employee number of Element 7's delivery employee who delivered the order;
3. The first name and employee number of Element 7's employees who prepared the order for delivery;
4. The first name of the customer and an Element 7 retailer-assigned customer number for the person who requested the delivery;
5. The date and time the delivery request was made;
6. The delivery address; and
7. A detailed description of all cannabis goods requested for delivery.
Communications
• Each driver will carry a communication device and a cell phone for backup communication.
• Driver will always remain in contact with Element 7's Central Security Control Room as well as 911 and emergency services, if necessary. • Onfleet provides for encrypted driver chat features that permits drivers to maintain contact with Element 7’s dispatcher at all times.
Route Planning
• The Dispatch Team will plan route security after the time and destination are determined. Routes will be randomized and times varied. Onfleet provides Route Optimization and shares assigned routes with drivers through encrypted connections to dedicated handheld devices. We have developed best practices for route optimization in the event that Onfleet Route Optimization is over-ridded. These best practices have been developed to comply with local and state regulations:
1. Operational security will be based on the number of stops on a route, crime by area figures, known previous routes, etc.);
ELEMENT 7: DELIVERY PLAN
2. Traffic (time of day or road incident);
3. Known public events, i.e. parades, demonstrations, unusual activity using current information available from a variety of sources to include news releases, police and city offices, social media; and
4. Ongoing real-time incidents that would impede delivery business. ● If an Element 7 delivery driver does not have any delivery requests to be performed for a 30-minute period, the delivery driver will not make any additional deliveries and will return to the facility.
CONTROL AND COMPLIANCE
Carriage of Business License
All vehicles associated with the business will carry in the vehicle a copy of the valid, unexpired business license as well as a copy of Element 7's current non-storefront retailer's license. In addition, Element 7 vehicles will be registered with the City Police Department.
Delivery Employees
● Element 7 will not employ or retain persons under 21 years of age. ● All deliveries of cannabis goods will be performed by a delivery employee who is directly employed by Element 7.
● All deliveries of cannabis goods will be made in person. A delivery of cannabis goods will not be made through the use of an unmanned vehicle. ● Delivery employees will carry a current government-issued identification, and an identification badge provided by Element 7.
Online Age Verification
● Electronic age verification will be utilized to determine the age of any individual attempting to purchase cannabis goods. All employees will be instructed on its use.
● Our website and mobile app have age verification parameters configured into the software. Anytime the website is accessed, or the mobile app is opened, an age verification page is activated and the user will not be able to access the site or the app unless they are able to verify that they are 21 years old or older.
ELEMENT 7: DELIVERY PLAN
● Cannabis will not be sold to the public without electronic age verification. ● Delivery employees will verify the age and identity of the recipient of the cannabis goods at both order time and delivery of goods. ● Cannabis goods will only be received by the customer. The driver will scan the customers' valid identification card and verify that the individual is 21 years of age or older.
METRC Compliance and Reporting
Delivery orders that are placed through the website or the mobile app are processed through FlowHub, our point-of-sale system. That means that sales transactions and inventory are still accounted for, and reported to METRC.
Orders taken over the phone are also processed through FlowHub by the authorized employee designated to receive and process delivery orders over the phone.
As part of internally developed Compliance Reporting and Inventory Management best practices, inventory, sales and discrepancies reports will still be reviewed before data is pushed to METRC, via FlowHub.
Summary
Element 7's Delivery business and operations are a critical focus point for our overall business strategy. While cannabis is a highly experimental and discovery-led category in 2020, we know that moving ahead, cannabis will more closely mimic existing shopping and buyer behavior practices of other consumer product verticals. Having a robust business plan and set of policies in place will be critical to our expansion efforts in this vertical over the next 3-5 years as we seek to become one of the leading and largest cannabis delivery companies in California.
7 SECTION E
MITIGATION PLAN
SECTION E
MITIGATION PLAN
ELEMENT 7: MITIGATION PLAN
MITIGATION PLAN
Commitment to the Community
Element 7 is committed to being an asset to the local community. We aim to enhance the local community by being a safe, professional business that is considerate and dedicated to the advancement of the community. As recent studies indicate, the introduction of cannabis dispensaries to both urban and suburban neighborhoods can make them safer, reduce the incidence of opioid-related problems, and increase values of homes and surrounding properties.
Element 7 strives to establish cannabis dispensaries to encourage private enterprise and entrepreneurship, contribute to the community’s overall health, and promote awareness of the benefits of marijuana through education, seminars, newsletters, and so forth.
Element 7 will maintain the business premises in a manner that will best eliminate potential nuisances, safety and security issues, and negative effects on the surrounding grounds. Element 7 is focused and conscious about its role and potential impact on the local neighborhood; as such, Element 7 intends to operate in a manner that is respectful and beneficial for the residents, visitors, and business owners in Mendota.
Further, Element 7 recognizes that it is essential that cannabis businesses are compliant, safe, and considerate of the surrounding area. Given the potential concern of the City of Mendota, the state regulatory agencies and local residents regarding the operation and location of commercial cannabis businesses. Element 7 ELEMENT 7: MITIGATION PLAN
has consciously chosen a location that will fit well within the City of Mendota.
Specifically, the business premises are located well outside the sensitive land use buffer zone, as specified in the Mendota Municipal Code.
Site Compliance with Buffer Zones
Per the Mendota Municipal Ordinance, the site is compliant in that it is not within six hundred feet (600') of a sensitive use facility or location. The nearest sensitive locations are:
TYPE NAME OF NEAREST FACILITY DISTANCE FROM
FACILITY
School Washington Elementary School 782.18 Feet
Child Care Center Mendota Migrant Head Start 2,700.24 Feet Youth Center Mendota Youth Recreation Inc. 602.76
Nuisance Management
Element 7 ensures the establishment of “neighborhood-friendly” cannabis dispensaries in the community as it is our goal to present an aesthetically-pleasing as well as safe and secure business operation as possible. To enhance community transparency and engagement, besides providing formal meetings and public pronouncements about our products and services, we will provide other ways to inform community members about potential regulations and practices via such methods as surveys and/or additional online platforms.
Element 7 will enact the following practices to ensure a “good-neighborhood policy” with prospective neighborhood business establishments and communities:
• Provide a pleasing storefront absent of offensive signs or symbols that may attract undesirable individuals or inspire neighborhood bad relations. • Operate a well-run, clean, store staffed with industry professionals. • Hire on-site security personnel to ensure the safety of customers and employees.
• Ensure the placement of hi-tech security systems, lighting, fencing, alarms, etc., to promote a safe environment for employees as well as clientele. • Establish effective banking and cash-handling practices so as not to endanger employees or clientele by exposing them to risk of robbery or physical harm. • Maintain positive relations with local police departments, municipalities, and elected officials to ensure compliance with local laws and promote the safety of the neighboring community.
• Remove graffiti and prevent loitering.
• Provide a 24/7 telephone hotline, responsive website, email dedicated to receiving and responding to feedback and/or complaints.
ELEMENT 7: MITIGATION PLAN
• Assign a local Community Liaison who will be able to address any complaints, feedback and/or concerns from neighboring businesses and community members.
Odor Management
Odor concerns, whether caused by cannabis plants and products themselves or the smoke from consumption, can be legitimate, and we ensure that controls are put in place to mitigate the strong, pungent aroma that marijuana can produce. Our facilities are equipped with high-end heating, ventilation, and air conditioning (HVAC) systems to negate the strong scent that cannabis products often induce, and we continuously explore new odor-mitigation technologies to enhance the air quality of our dispensaries.
Loitering and Graffiti
Additionally, to prevent any other possible nuisances, we will prohibit loitering within fifty (50) feet of the premises, and “No Loitering” signs will be posted, if needed, at strategic locations around the property. Benches, chairs, or “rest spaces” will be removed or altered if they are determined to encourage loitering. A licensed security guard will be present on the premises to monitor the perimeter of the facility, control loitering, and site access. A state-of-the-art security system with strategically placed, hi-tech cameras will keep a watchful eye over the property 24/7, and spaces that may encourage loiterers or vagrants to “camp out” will be refurbished or eliminated.
All facilities will be locked and monitored by security surveillance at night.
Also, Element 7 will ensure that any debris, graffiti, and unappealing or unsafe aspects of the building will be adequately addressed by having the General Manager sweep the perimeter of the premises once a day after opening.
Element 7 will encourage the community to communicate any concerns, issues, or questions it has regarding our operations and/or the cannabis industry in general to our Community Liaison. We are committed to creating a safe, environmentallyfriendly, and compliant facility.
Noise Reduction
We will not have any activities or operations on site that would create excessive noise for neighboring businesses. The design of our facilities provides sound-proofing measures via insulation, double-paned windows, foam matting, carpeting, acoustic ceiling tiles, etc., that will absorb excess sound produced from daily business practices onsite, preventing it from affecting neighboring businesses or residences. Entrance and exit points will be directed away from noise-sensitive areas, especially in regard to deliveries and vehicles moving materials on- or offsite. Noise barriers will be furnished, if necessary, in noise-sensitive areas in the form of walls, fences, and/or dense plantings of shrubs/trees, or some combination of these, with close attention paid to aesthetic visual appearance. There will be 24-hour surveillance of the property to ensure that noise levels are kept at a minimum at all times. Customers and patients will be asked to quietly leave the premises after all transactions have been completed.
ELEMENT 7: MITIGATION PLAN
Traffic Management
Traffic congestion across many Cities in California is reaching intolerable levels. New building congestion is one of the major causes of traffic congestion which is why Element 7 has chosen an already built property that requires minimum construction works to become operational.
The site we have located is a major traffic thoroughfare and we have adequate parking within our premises to allow customers and patients to safely park off the street and reduce traffic impacts. Our loading areas are strategically located within the premises with adequate turning circles to reduce traffic congestion, and delivery vehicles for products will be minimized to small compact delivery and cargo vans.
Deliveries will be requested from suppliers at non-peak times to further reduce traffic stress.
Cannabis customers shop throughout the day – some will come in early before they start the day and others will shop after work – this constant flow of customers through the day ensures that we are not contributing to peak hour traffic issues which currently affect the City.
We prefer to hire staff locally and they will be encouraged to use public transport or to ride a bicycle to work – all staff that use public transport or a bicycle for the majority of their work travel will be rewarded with a monthly meal bonus valued at $30.00 in our ‘Commute the E7 Way’ program. Part of this program includes providing bike racks for employees who are able to ride their bikes to work. A ride-sharing waiting area will also be included in our parking area plans, as well as an electric-vehicle charging station.
Odor Management
Element 7 has developed a proactive integrated odor management system to eliminate cannabis odors from the immediate exterior of the Facility, and between operations within the Facility. As part of our Good Neighbor policy and internal practices, we take all odor and noise complaints very seriously. If an odor complaint is made against our facility, we will work with local officials to find the source of the odor and eliminate it.
Industry standards demand that comprehensive Odor Control devices and best practices are implemented across cannabis facilities. As a leading cannabis operator, we work with 15000 Inc., an industry-specific engineering group from Santa Rosa, who are experts and leaders in designing effective and environmentally efficient odor management systems that we implement across our facilities.
The best practices and industry approved-equipment ensures redundancies across our system that exceed State and City directives to absorb and eliminate cannabis odors. Our odor and noise management systems prevent odor generated inside the facility from being detected outside our facility, anywhere on adjacent property, or public rights-of-way.
Odor Management Services
Element 7 works with 15000 Inc. in developing odor and noise management plans for each our facilities across California. With 15000 Inc., we look to partner with, and ELEMENT 7: MITIGATION PLAN
engage the services of, local HVAC, electrical, plumbing and construction companies as part of our Local Sourcing Policy.
Cleanleaf CL2500 HVAC with HEPA Filters (ACS)
Element 7 utilizes HVACs with HEPA filters, six to twelve pocket bag filters, activated carbon inserts, and an ultra-quiet blower that creates negative pressure and does not produce more than 62dBa. There are four filtering layers with the CL2500 that provides quadruple redundancies to ensure that odor generated at the facility does not leak into its external surrounding areas and cause an odor nuisance. This comprehensive and environmentally efficient system captures airborne threats that include mold, fungi, spores, bacteria, pollen, pests, insects, volatile organic compounds (VOCs) and odors. The system requires 115V 60Hz power and produces just 62 dBa (decibels) of sound, which is equivalent to a conversation in a restaurant, office background music, or an air-conditioning unit at 100 feet.
Carbon Scrubbers
Element 7 will also be deploying activated carbon scrubbers in storage rooms where the highest concentration of products is located. These types of filters use pelletized granule carbon to remove odor, dust, and pollutants from the air and can be used as a standing unit in a space or as an exhaust filter. Just like the carbon in the air filters mentioned previously, these pellets remove dust, odor, and other pollutants through the air as it passes through the filter.
Air Quality Enhancing Plants
Part of Element 7’s facility design incorporates living plants that have the ability to enhance air quality. NASA studies the effects of plants on air quality and their research confirms that common houseplants are natural air purifiers.
Although their original research was aimed at finding ways to purify the air for extended stays in orbiting space stations, the findings are important for us on Earth as well. The following plants are documented as being especially good at improving indoor air quality and will be used within the interior design of Element 7's facilities:
● Aloe Vera
● Bamboo Palm
● Peace Lily
● Spider Plant
● Parlor Palm
● Red Emerald Philodendron
● Gerbera Daisy
ELEMENT 7: MITIGATION PLAN
Daily Inspections Program
Element 7 will conduct daily field tests to measure odor outside the facility using a "Nasal Ranger Field Olfactometer", which is manufactured by St. Croix Sensory, Inc.
The Olfactometer provides precise odor strength measurement that is consistent from place to place. This device will enable local authorities, and Element 7, to validate and/or substantiate odor complaints.
The maximum threshold for odor control is the dilution-to-threshold (D/T) ratio of seven parts clean or filtered air to one-part odorous air (7:1). Cannabis odor typically rates at a Level 7 on the olfactometer.
To "pass" an odor control test, the cannabis facility must yield a test result that is LESS than the Level 7, which is the maximum threshold at all three (3) odor measurement locations:
(a) The front entrance of the facility, and
(b) Two (2) opposite property boundaries accessible from public right-ofway points, and A single test from any location resulting in a 0/T ration in excess of 7:1 equates to a "failure" of the odor control test and will trigger the following:
(a) A re-test of the results 30-minutes after the failed test which will be conducted at all 4 property boundaries;
(b) In the event of a continued “fail”, the General Manager will inform the Element 7 CEO and Chief Compliance Officer and engaged HVAC and CL2500 manufacturer team will be dispatched to the site.
Odor Management Hotline
As part of Element 7’s community and outreach programs, an odor management hotline will be set-up to receive and process odor complaints. Community members and neighbors will receive Company-issued communication twice annually, ELEMENT 7: MITIGATION PLAN
reminding them of the Odor Management Hotline – a number they can call for any complaints from an Element 7 facility.
Parking Management
The site has sufficient off-street parking for both staff and customers, including an ADAcompliant parking space. All parking spaces will be clearly marked and sign-posted for the convenience of Element 7 shoppers and to ensure that adjacent businesses are not adversely impacted. Safety for customers and clientele is always Element 7’s primary concern, and the following policies will be enforced:
• Any damaged, deficient, lighting fixtures or unlit areas will be immediately addressed
• Parking rules concerning hours of operation and signs prohibiting loitering or trespassing will be posted, with a telephone number provided to report any suspicious activity
• A safe waiting area for passenger pick-up will be designated • 24-hour security will be provided for the entire perimeter of the premises Summary
Gone are the days when neighbors brought brownies to your doorstep as a welcome gift. An unfortunate side effect of technology is less face time with neighbors. This is the same when it comes to business owners and their neighboring businesses. We all have good intentions, but as business owners, we get laserfocused on the day-to-day operations and don't find the time to introduce ourselves around the neighborhood.
Business owners operating in the same city and neighborhoods face similar issues.
From city ordinances and road closures, to taxes and rent values, business owners have a big say in what happens in their own communities. When owners can come together on the issues that affect them all, regardless of the industry, we all win.
Marketing is a huge part of business success and working together with our neighboring businesses will be a great tool in bringing people in the door. From crosspromotions to coordinating neighborhood events to strategic discounting, partnering with our neighbors will be a great source of getting people to enter and spend money in our store.
Because each community has its own personality, business owners can help and learn the most from those that have similar experiences within the same community.
At Element 7 we believe that having a strong personal and working relationship with our immediate neighbors not only makes for good business practice, but also creates a better working environment for everyone.
7 SECTION F
REFERENCES & EXPERIENCE
SECTION F
REFERENCES & EXPERIENCE
ELEMENT 7: REFERENCES AND EXPERIENCE
REFERENCES AND EXPERIENCE
Introduction
Element 7's Owner and Founder is Robert DiVito. Robert has over five years’ experience in the cannabis industry managing one of the State’s largest greenhouse operations (720,000 square feet of cultivation and manufacturing), cannabis policy development, and retail operations with Element 7. Prior to joining the cannabis industry, Robert was the Founder and CEO of an EQ-based learning academy and small business owner.
If awarded a permit in Mendota City, Robert will leverage the experience, skillsets, and extensive accomplishments of the Element 7 team to create and scale a cannabis business that maximizes revenue and taxes for the City, while striving to be the most controlled, compliant, taxed, tested, and trusted cannabis operator in the City.
Element 7 draws from vast cannabis business ownership, management, and operating experience, and our goal is to integrate seamlessly into the Mendota community, promoting education-focused programs and initiatives that contribute to the local economy and enhance the quality of life of its residents.
We have the skills needed to be successful and sustainable. We keep our corporate overhead lean and implement smart technology applications where they make sense. We leverage data and insights to make decisions, combining that with intuition and experience. Our staff are trained 5X more than the industry average and we use platforms and systems like CURA-AI to make medical recommendations ELEMENT 7: REFERENCES AND EXPERIENCE
to our patients, rather than relying on budtenders and front-line sales staff to advise patients on dosages and strains (CURA-AI is a machine learning platform built for medical patients to recommend cannabis products). Our founders have over 25 years of experience in the cannabis industry and decades of traditional retail experience, understanding, and operations.
We are well positioned to deal with volatility, uncertainty, and change. During the recent COVID-19 health crisis, we hired new staff and expanded at a time when many in the industry shrunk and contracted. We are agile – our size and scale will enable us to continue to expand in the future, but we keep reporting lines thin and empower our middle management so that we can make quick decisions to drive our business forward. We have the financial backing needed to build, operate, and scale all of our permits, licenses, and locations. Our passion for winning, succeeding, and building a better business is unmatched. We are continually looking for ways to do things ‘1% better’ and actively incentivize our staff to find daily improvements in processes and systems. Within days of California locking-down during the COVID-19 health crisis, we had a comprehensive SOP in place to better manage staff and customer safety. Our Retail Operations Director (Neil Demers) and Retail Experience Director (Nicholas Jack) were awarded Cannabis Business Executive of the Year and Dispensary Manager of the Year Awards at the 2018 National Cannabis Business Awards. We constantly strive to not only do smarter business, but ‘better business’ in the communities we operate.
In pursuit of our endeavours, we have collaborated with some of the world’s largest cannabis and non-cannabis brands (e.g., Playboy), and developed harmonious relationships with local officials in each of the cities and counties where we do business. Our understanding of technology and access to proprietary data through our partnership with Brigade, the sole global licensee of Weedmaps data, powers our understanding and thinking. This partnership gives us a competitive edge and deep understanding of cannabis consumers as we analyze search data. Our vertically integrated operations allow us to control pricing, shelving, ranging, and quality, which will be critical to building a successful sustainable business in East LA County which has dozens of non-compliant cannabis retail delivery operators and a thriving illicit market which present a challenge to operators that cannot compete with this activity.
As we enter Mendota and build a scalable sustainable business in that market, the City of Mendota has our commitment to doing things right and ensuring that the promises made are the promises kept.
Existing Operations in California
Our existing Cannabis Dispensary operates in Santa Ana, CA – since taking over this business in late 2019, sales are up 52% driven by attention to marketing, customer data and insights, product mix, and pricing. The dispensary provides us with the operational know-how and insight to efficiently and compliantly scale our retail dispensary operations across the State.
ELEMENT 7: REFERENCES AND EXPERIENCE
Our 2nd store, The Bakery by Element 7, will be open for operations in September 2020.
Based in Fort Bragg, this dispensary will serve this seaside community utilizing our existing experience from the dispensary in Santa Ana, with a goal of hiring 80% of the staff from the local community.
Testimonials: What the Industry Says About Element 7
“Element 7 are the real partner for social justice and reform in an industry where many have taken advantage of minority communities. In the Los Angeles Social Equity Program, no other cannabis company came close to offering fair terms like the team at Element 7 offered equity candidates.”
Bonita Money
Founder and Director
NDICA
“Element 7 are a company with a strong vision, focused on understanding the customer and building a long-term sustainable cannabis business in a nascent and emerging California industry.”
Jonathan Jenkins
Co-Founder and Chief Operating Officer
Weedmaps
“Element 7 bring a level of professionalism and integrity to the cannabis industry.
They are focused on doing things right and building a business that can stand the test of compliance and continued regulation.”
Bob Hoban
Founder
Hoban Law Group
“Element 7 have been a strong supporter of UCLA and our Cannabis Research Inititiave since it was formed in 2018. I not only value their support for advancing the cannabis industry and cause, but also their friendship, integrity, and trust.” Dr. Jeff Chen
Founder and Lead
UCLA Cannabis Research Initiative
ELEMENT 7: REFERENCES AND EXPERIENCE
“Element 7 are a true advocate for social justice and change in an industry that needs more honesty and diversity.”
Scheril Murray-Powell
Cannabis Advocate, Activist, and Attorney
“Element 7 have been a great partner of Diverse Real Estate Solutions, a multi-billion dollar cannabis property and investment group. We value their hard work, commitment to doing things right, and ethics.”
Charlie Copelan
Partner
Diverse Real Estate Solutions
“When it came time for Playboy Enterprises to launch its brand in the US Cannabis Market, we met many groups in the industry and landed with Element 7. We value them as a key strategic partner, facilitator, and friend of the Playboy brand and business.”
Jared Doughty
Global Head of Licensing
Playboy Enterprises Inc.
“Robert (I call him Bob) and I have become friends over time, and I find him to be a straight up guy with a high energy quotient and a laser focus on whatever project he is working on. He is a bulldog.”
Jarral Neeper
President
Calcot Ltd. (California Cotton Cooperative)
Issued Local Permits
DiVito has been issued contingent and preliminary permits in several cities in California including:
• Walnut Creek: City Permit for Non-Storefront Retail Delivery • Rio Dell: City Permit for Storefront Retail Dispensary • American Canyon: City Permit for Non-Storefront Retail Delivery, Manufacturing and Distribution
• Dunsmuir: City Permit for Storefront Retail Dispensary • South San Francisco: City Permit for Delivery
• Firebaugh: City Permit for Manufacturing and Distribution Element 7’s experience applying for licenses in the State of California is extensive – in August 2019, Element 7 received the highest score of any company in the industry in the City of Chula Vista (494/500) and in September 2019, a 100% perfect score in the City of Marina. Permits in both of these cities, and others, are pending issuance ELEMENT 7: REFERENCES AND EXPERIENCE
Playboy Cannabis Co. Joint Venture
Element 7 recently entered a Joint Venture with Playboy Enterprises Inc. to create, launch, distribute, and manage a range of cannabis branded products, which is an exclusive joint venture for the California market.
Element 7 Management
ELEMENT 7: REFERENCES AND EXPERIENCE
As the Founder and CEO of Element 7, Robert oversees Element 7 operations in over a dozen Cities and Counties across California. These operations span the breadth of the industry and include cultivation, manufacturing, distribution, storefront retail, delivery, and brands. Element 7’s Executive Team will support all local operations under an annual management contract. The Element 7 team brings a wealth of experience, management understanding, and operational expertise across the cannabis industry, other regulated industries, and cannabis retail.
In addition, Element 7’s operational team has extensive experience working with vendors and suppliers necessary to construct, remodel, and successfully operate facilities associated with cultivation, testing, processing, and dispensing regulated cannabis. The Executive Team, supported by its advisory board of industry experts, is well-equipped to navigate the legal processes in establishing and maintaining profitable and legal cannabis operations throughout the state. The Executive Team provides oversight, financial control, compliance, risk management, and retail operations management guidance to the day-to-day operating team and staff of the organization. Specific employee’s, described below, will serve as Element 7 Mendota’s day-to-day operational team, supported by staff that will be hired from the local community.
ELEMENT 7: REFERENCES AND EXPERIENCE
AMBER NORWOOD
CHIEF COMPLIANCE OFFICER ELEMENT 7
Amber joined the Element 7 team to head its compliance and regulatory affairs division in 2018 and has quickly proven to be one of the key executives in the company. In her current role, Amber oversees regulatory compliance, licensing and project management. Having won over 25 licenses for clients in California and submitting applications in over 8 US States, she specializes in writing and implementing Standard Operating Procedures across all aspects of the industry. Amber was born and raised in Pasadena and is active in the local community and cannabis industry — she is a member of NORML, Minorities in Cannabis Business Association and WomenGrow, a female focused industry group expanding female representation in the cannabis industry. Amber previously worked with the Attorney General's Office in Miami before joining the cannabis industry.
COREY ENGLISH CHIEF SECURITY OFFICER ELEMENT 7
Corey English (Chief Security Officer) is Element 7's strategic security lead and oversees alll security measures and efforts for the Element 7 brand. His security guidance covers alll risk management, threat suppression, and systems to guide the Element 7 business and team.
He is the President of LEAPS (Law Enforcement and Private Security) and has over 2 decades of experience working for some of the world's largest companies managing their security and risk management systems.
JOSH BLACK
CHIEF MARKETING OFFICER
ELEMENT 7
Josh is a former Marketing Director with PepsiCo, managing Tropicana, Aquafina and Gatorade brand launches in over a dozen markets globally. He is the former CEO for WPP’s (world's largest media and marketing services holding company) content and entertainment business. He is a published author, was named in the media industries '40 Under 40' in 2016 and manages Element 7's commercial, marketing, talent and training, and licensing functions. Black has written and won over 50 license applications in North America, is a co-founder of CT3 (worlds first CBD beverage for traumatic brain injury), and Daily Hemp Co which is sold on Amazon.
ERIC GREENBERG CHIEF FINANCIAL OFFICER ELEMENT 7 LLC
Eric Greenberg is an accounting, financial control and taxation specialist. He is a Certified Public Accountant (CPA), member of AICPA and is an Adjunct Lecturer at De Paul University's Commerce Faculty in Chicago. He holds a Masters in Business and Taxation and has over 30 years experience in accounting, taxation and financial risk management. His experience spans consumer goods, services, professional athletes and capital markets.
LYNNE LYMAN SULT itej (ow No) hyo) wi) ied co)hoa A 1aze). 11) ELEMENT 7
Lynne Lyman was one of the central figures responsible for cannabis legalization in California, named in the Top 100 most influential people in cannabis nationwide, as well as in the Top 5 in Los Angeles. Having spent over five years as the California State Director for the Drug Policy Alliance, Lynne's vision, strategy and exceptional organizing skills helped propel the state to gain critical mass throughout 2016 resulting with 57% of Californians voting Yes on Proposition 64, the Adult Use of Marijuana Act, permanently changing the landscape for cannabis in the sixth largest economy in the world, while reducing or eliminating most cannabis crimes, including retroactively. Lynne's work at Drug Policy Alliance did not start or stop with cannabis. Among other major drug policy reforms secured in her 5 year tenure, Lynne led the successful 2014 effort to equalize the penalties for crack and powder cocaine under California law. Lynne continues her work to advance criminal justice reform and cannabis equity as a consultant in Los Angeles.
Lynne has held positions with local, state and federal governments in California and Massachusetts, in addition to managing over a dozen political campaigns for candidates in California, Massachusetts, and Colorado. Ms. Lyman, who is fluent in Spanish, has worked on political campaigns in Central America and addressed the Mexican Congress on cannabis policy. Lynne received her M.P.A. from the Harvard Kennedy School of Government in 2001, where her graduate work focused on the criminal justice system and leadership. She earned her B.A. in Political Science from UC Berkeley in 1996.
ELEMENT 7: REFERENCES AND EXPERIENCE
ELEMENT 7: REFERENCES AND EXPERIENCE
Strategic Advisors
Element 7's Strategic Advisors comprise some of the cannabis industries biggest names, leaders and experts. The Advisers will meet four (4) times annually to review the Element 7 MENDOTA LLC Business Plan, Operations, Financial Performance and specific benchmarks set for compliance, control, product quality, systems and ELEMENT 7: REFERENCES AND EXPERIENCE
processes and special initiatives.
Our Advisors include one of North America's leading marijuana law reform advocates, the founder of the nation's first cannabis university, one of the co-founders of DOSIST, the former head cultivator for MedMen, a former Bureau of Cannabis Control staffer and MAUCRSA author, and one of California's leading cannabis technologists.
Our alliance with Diego Pellicer, voted the #1 Dispensary in North America at the 2017 and 2018 National Cannabis Business Awards. This is an important relationship for Element 7 as it expands our operational expertise and ensures that we have additional perspectives at the table when making strategic decisions on the future expansion of our retail footprint.
As a world leader in the premium cannabis market, Diego Pellicers’s extensive experience in all aspects of the cannabis industry, including development, growth, execution, regulatory compliance, commercial grow facilities, and large-scale edible/concentrate manufacturing and processing aligns well with Element 7’s vision.
The brand’s high-calibre products, merchandizing, and world-class customer service make Diego Pellicer a valued partner as Element 7 moves forward in the industry.
Neil Demers, named 'Cannabis Executive of the Year' (2018) and Nicholas Jack, named 'Dispensary Manager of the Year' (2018) at the National Cannabis Business Awards, both sit within Element 7's Strategic Advisors, and bring a tremendous amount of retail experience to our existing team.
ELEMENT 7: REFERENCES AND EXPERIENCE
BOB HOBAN
STRATEGIC ADVISOR, LEGAL
ELEMENT 7, LLC
Bob is the founder and CEO of Hoban Law Group, North America's #1 cannabis and hemp law group. Bob is recognized as one of the leading commercial cannabis practitioners and has litigated nearly every aspect of Colorado's Marijuana Code and a significant portion of California's. Bob has drafted cannabis policy for dozens of States and countries around the world and is a global expert in cannabis policy.
DR. YUFU CHENG HEAD OF SUSTAINABILITY ELEMENT 7, LLC
Dr. Yufu Cheng is a global cannabis medical advocate and the China representative for former Governor Schwarzenegger's R20 Global Warming Committee. Cheng leads Element 7's Task Force on environmental measures, reducing our carbon footprint and creating sustainable clean cannabis. Cheng holds a Ph.D. in Ecology (Climate Change) from UC Davis and works with some of North America and China's largest organizations to implement corporate policy.
KEVIN SULLIVAN DATA SECURITY ADVISOR ELEMENT 7, LLC
Kevin Sullivan (Data Security Advisor) is a proven and experienced business leader with over 30 years experience in data security, military systems, and government contracts. Kevin rose to the rank of Lieutenant Colonel in the US Army (Director of Aviation, US Army Pacific, Fort Shafter, Hawaii), soending 20 years serving his country. He is the Founder of Leading Points Corporation which provides data security, biosecurity, and enterprise solutions globally, and the CEO of International Hemp Solutions, one of North America’s largest hemp companies.
TIM GORDON aYo4] fot 139-1 Col WYK Xe) ELEMENT 7
Tim Gordon became President at CBDRx and Functional Remedies in 2017 and is now serving as Chief Science Officer for the Company. Born and raised in Canada in a Cannabis farming community, Tim's love for sustainable cannabis farming is only eclipsed by his love for the cannabis plant. Tim oversees hemp operations and the Functional Remedies product division. Tim has developed an aggressive cannabis breeding program, an industry leading agricultural operation, and state of the art laboratory and production facility. Tim serves as a technical adviser on the board of the National Hemp association and is also President of the Colorado Hemp Industries Association. Tim has written and researched the cannabis plant for nearly 20 years and has been highlighted in news programs and in magazines and periodicals. Functional Remedies is the world's leader in cannabinoid hemp production and CBD enhanced nutraceuticals, while leading the way in eco-sustainable hemp farming.
DR. EFTHIMIA VASILIADIS, PHARM D. PHARMACEUTICAL PRACTICES ADVISOR ELEMENT Efthimia
Pharmaceutical
holds
7 a Doctorate
Studies (2000-2002),
Degree in
and
Pharmacology
a Bachelors
(2002-2004),
of Science in
a
Molecular
Bachelors
Cell
of Science
Biology,
in
all from the
prestigious University of Connecticut. She brings almost unmatched experience as a retail pharmacist and has worked for CVS Pharmacy Inc., for 17 years (2002 - 2019), and the Stop and Shop Pharmacy Group for a year (2019). Her unique skillsets filing and processing prescriptions, operating under highly regulated State and Federal Laws, counseling patients, collaborating with physicians and insurance companies, managing inventory, and addressing workflow issues, are invaluable to Element 7 as we focus on being the most compliant, controlled, and regulated cannabis retail operator in California.
ELEMENT 7: REFERENCES AND EXPERIENCE
ELEMENT 7: REFERENCES AND EXPERIENCE
Summary
Element 7's matrix management approach allows us to stay agile and nimble, ensuring that front-line staff has the expertise, authority, and direction to work efficiently while adhering to a rigid set of policies and practices that standardize our commitment to excellence in serving our customers.
With decades of cannabis and business management experience, the Element 7 team is uniquely positioned to leverage this experience with our deep understanding of cannabis industry law, compliance, and management systems in creating a management model that brings structured retail discipline to the industry.
ELEMENT 7: REFERENCES AND EXPERIENCE
We are confident that our extensive industry experience — coupled with our unique, agile business model — ensures that no other cannabis company is a better fit for Mendota than Element 7.
United Food and Commercial Worker’s International Union Letter of Support
To Whom It May Concern:
Element 7 is a well-respected name in the cannabis industry in California and is a strong partner of organized labor.
In multiple jurisdictions, Element 7 demonstrated a commitment to operating under the highest principles regarding labor standards, community engagement and legal compliance. Element 7 signed a labor peace agreement with the United Food and Commercial Workers for its active operations in California and entered into a separate agreement with the UFCW for their application in Illinois. Element 7 has respected both the letter and spirit of the labor peace agreement in California. Considering Element 7’s superb track record on the west coast, the UFCW has every reason to believe they will make excellent community partners for the state and citizens of Illinois. Please accept this letter as an endorsement of Element 7’s application for an adult-use dispensary from the United Food and Commercial Workers Cannabis Workers Rising Campaign.
Sincerely,
Aidan Coffey
Campaign Coordinator - Cannabis Workers Rising Campaign UFCW International
1775 K St NW, Washington, DC 20006
City Hall (951) 674-3124 Fax (951) 674-2392 130 South Main Street Lake Elsinore CA 92530 June 18, 2020
To Whom This May Concern,
My name is Steve Manos. For the past seven years I have served as Mayor and City Council Member for the City of Lake Elsinore.
For several years I’ve been engaged with the individuals conducting business under the company name Element 7. Robert DiVito and his partners are engaged in one of the largest, fastest growing cannabis operations in California.
From everything that I’ve seen they are a strong company that operates with integrity. Their strategic partnerships and willingness to improve the communities that they are in is exemplary. I know elected officials throughout the state that are familiar with the organization and have heard nothing but positive feedback. They fulfill commitments and have the capacity to continue growing.
These are the types of organizations that we should see running cannabis operations in our communities. Speaking for myself, I recommend them to anyone considering a partnership in the cannabis sector.
Respectfully,
Steve Manos
Councilman
City of Lake Elsinore
Direct (951) 317-8830
City Hall (951) 674-3124
[email protected]
CAPITOL OFFICE:
COMMITTEES: 201 Geen ESO AVE APPROPRIATIONS ; FISCAL OV; ROOM 330 CAL OVERSIGHT GUBERNATORIAL APPOINTMENTS JEFFERSON CITY, MO 65101 WAYS AND MEANS TELEPHONE (573) 751-4415
JOINT COMMITTEE ON EDUCATION FAX (573) 751-9758
JOINT COMMITTEE ON GOVERNMENT ACCOUNTABILITY [email protected] JOINT COMMITTEE ON LEGISLATIVE RESEARCH
MISSOURI SENATE
JEFFERSON CITY
JAMILAH NASHEED DISTRICT 5
August 16th, 2019
Department of Health and Senior Services Section for Medical Marijuana Regulation PO Box 570
Jefferson City, MO 65102
To Whom it May Concern:
It is my understanding that Robert Divito/Element 7 is applying for licenses allowing them to both produce medicinal cannabis, as well as operate a dispensary within my district. Upon reviewing their business and track record in existing locations, I believe that both the proposed production facility located at 4510 South Broadwa: , and additionally the proposed dispensary location at 4200 S. Grand, would contribute greatly to the economic development of the neighborhood. In addition to the jobs that will be created with the production facility and dispensary, I believe that Element 7 will provide the neighboring residents with equitable access to medicinal cannabis as other parts of the city and region that are not as often overlooked for these types of investments.
There is community support for both the production facility as well as the dispensary location, and Mr. Divito/Element 7 have done an excellent job at engaging the local community leaders and concerned citizens groups.
Please do not hesitate to contact me if I may be of any further assistance.
Sincerely yours,
pee Mada?
Senator Jamilah Nasheed
Sth Senatorial District
CAPITOL OFFICE
Missouri State Capitol
201 West Capitol Ave., Room 1068
Jefferson City, MO 65101-6806
Tel: (573) 751-0438
E-mail: [email protected]
MISSOURI HOUSE OF REPRESENTATIVES
Steve Butz
State Representative
81 st District
COMMITTEES:
Insurance Policy
Transportation
Special Committee on Small Business
August 9, 2019
Department of Health and Senior Services
Section for Medical Marijuana Regulation
PO Box 570
Jefferson City, MO 65102-0570
To Whom It May Concern.
It is my understanding that Mr. Robert DiVito of Element 7 is applying for a production license to produce medical marijuana. The proposed location is at 4510 S. Broadway (aka 2720 Dakota, the Broadway Tool building) St. Louis, MO 63111. As a lifelong resident of south city and the State Rep for this location, I can assure you it is an excellent industrial location for a production facility.
In full disclosure, I am a supporter of legalized medical marijuana and did vote for its passage during our last election cycle. My reasons are many but one in particular is my own personal experience of caring for my younger brother who died of cancer after a long, brave two year fight, several years ago. As I am sure you are aware there are many challenges faced by a cancer victim. Dealing with the effects of chemo-therapy, bouts of depression and anxiety and at times severe pain. My brother faced these as best he could and his doctors and other care givers did the same. He did need to use a small amount of marijuana while he was bed ridden and receiving hospice care. The fact that his doctors could not have prescribed this for him and the fact that we had to resort to illegally obtaining brought this issue to the forefront to me.
Community support for the facility along with the assurance of infrastructure and job creation in the immediate area where this new business will open is another reason I am in support of this application.
In addition their experience in the safety and security they can bring to this facility and the surrounding area is critical to the residents nearest the proposed location. After researching Element 7 and discussing the location with other concerned citizens it is my belief and hope that this business in our area will have a positive impact for the neighborhood, the clients they will serve and themselves by providing investment, jobs, taxes and charitable support in the City of St. Louis.
Sincerely,
�Bu!¾
gpt District Representative
March 1, 2019
RE: ELEMENT 7
Dear Robert,
On behalf of the National Diversity and Inclusion Alliance-NDICA, I would like to express our sincerest gratitude and appreciation to Element 7 for sponsoring and partnering on our Fresno Expungement and Resource fair last Saturday. NDICA’s work has been in the communities most negatively affected by the War on Drugs which is predominately people of color. These are the most neglected population from marginalized communities.
The support Element 7 provided for our Fresno event was instrumental in expunging 200 convictions under Prop. 64 and Prop. 47. These types of numbers are phenomenal for Fresno being that they have only expunged 89 convictions since the passing of Prop. 64 over 2 years ago. The event has positively changed many lives and taken down numerous barriers associated with a felony conviction.
Element 7 has proven to be a great asset to our social equity and social justice movement.
Thanks again for your support and we look forward to working with Element7 on many other socially impacting events.
Best Regards
Bonita Money
818-946-9702
Exec. Director of NDICA
WWW.THENDICA.ORG
To Whom It May Concern,
My name is Jarral Neeper. Until September of 2018, I was CEO of Calcot Ltd, a Bakersfield, CA based cotton marketing cooperative, serving growers in California, Arizona, New Mexico and Texas.
Beginning around 2010, Calcot had decided to put one of its star warehousing properties up for sale in Hanford, CA. That property is approximately 150 acres with 48 warehouses each measuring 35,000 square feet. It does have rail loading capability. Calcot no longer had need for the facility since cotton acreage in California had fallen so dramatically over the years.
Of course, a facility of that size does not move easily or quickly, but we were doing things to generate revenue on the property like loading railcars with tomato paste for a tomato processor, Olam. We were also storing dry goods for Olam. Other warehouses were being leased to cotton merchants who needed space. For example, Allenberg Cotton Company, had warehouses in Fresno but the new high-speed rail route going through Fresno purchased their property.
You get the picture.
Over time we did have interest from various potential buyers but for one reason or the other, nothing really worked, for them or for us.
Robert approached us in the spring of 2014 I believe. He had a vision of turning the property into a “WeWork” for marijuana producers. Each warehouse would be leased out to individual growers and an on-site testing lab would be available to all lessees. Robert worked tirelessly with the city council of Hanford to promote the idea that giving license to these growers would be a huge financial gain to the city. He met with the Police Chief and the Sheriff’s Department to promote his ideas and to get their feedback to as to the safety of the proposal.
Robert proposed a plan to buy the property and put a substantial amount of his own money into the deal until he could line up the investors needed on the deal. Many times, I thought things would not work out because real estate can be fickle, and we were asking a pretty penny for the property. In fact, one of the reasons other bidders had trouble with our property is the appraisals kept coming in well below our asking price and their bids.
Robert was a bulldog though and he eventually pulled off a “miracle” for us, getting an investor to come in and essentially writing a check for the whole property – at our asking price.
Robert (I call him Bob) and I have become friends over time, and I find him to be a straight up guy with a high energy quotient and a laser focus on whatever project he is working on. He asked me to write a letter of recommendation for him and I told him it would be my pleasure and honor to do so.
If there are any further questions, please do not hesitate to call me at 661.978.6958 or send me an email to [email protected].
Best Regards,
Jarral Neeper
President, Calcot Ltd.
Former Vice President, Amcot
Henry Perea
555 E. Terrace Ave
Fresno, CA 93704
559-287-08650
[email protected]
August 6, 2019
To whom it may concern,
I am pleased to write a letter of recommendation on behalf of Robert Divito, owner of Element 7. I have known Robert for over three years and have found him to be a responsible businessman. Robert is a person who is committed to the communities he works in and is willing to put resources into a community to benefit its citizens.
Robert’s willingness to work in partnership with schools is a win for our children. He is committed to engage in long term relationships with community partners. From a business perspective, he will never overcommit what he can deliver. That is to say, when Robert gives his word he will follow through and deliver what is promised in a timely manner.
Please feel free to contact me if you would like to further discuss.
Henry Perea
Former Fresno County Supervisor
Daniel Parra
1011 Ahronian Ave., Fowler CA 93625, 559-360-1379, [email protected] August 5, 2019
To Whom It May Concern:
It is with much enthusiasm that I recommend Robert Divito.
In the seven years I have known Mr. Divito, he has been a generous help in prospering our community’s economy. He not only works as a businessman to improve the economic development of our community, but as a citizen who cares about his community and the needs of others. Along with the numerous economic opportunities Mr. Divito’s businesses have brought to our community, he has also assisted in securing jobs for individuals in the area.
What makes Mr. Divito an important asset to our community is his large network of connections that he can reach out to in a timely manner. Through my years while working with him, I have witnessed him reaching out to local nonprofits and donating resources to them with hands on help.
Please let me know if I can provide any more information.
Sincerely,
Daniel T. Parra
Councilman, City of Fowler
President, League of California Cities Latino Caucus
7 SECTION G
COMMUNITY BENEFITS PLAN
SECTION G
COMMUNITY BENEFITS PLAN
ELEMENT 7: COMMUNITY BENEFITS PLAN
COMMUNITY BENEFITS PLAN
Introduction
Element 7 will create the following benefits for the City of Mendota and its community and residents:
1. Direct Revenue for the City’s General Fund. At 3% of gross sales, Element 7 believes it would deliver $90,000 in taxes in Year 1, with $165,000 in Year 3, and $180,000 in Year 5.
2. Direct Revenue for the City’s Non-Profit MMC. Element 7 have committed $50,000 annually to non-profits within the City.
3. Jobs Created. Element 7 believes that it will hire between 15 and 19 staff in a range of positions across the business, as indicated below. In addition, 12 local businesses have been identified as potential vendors and suppliers.
ANTICIPATED STAFFING NEEDS
2021 2022 2023 2024 2025
General Manager 1 1 1 1 1
Shift Managers 2 2 2 2 2
Retail Employees 6 8 8 8 8
Delivery Employees 6 6 6 8 8
TOTAL 15 17 17 19 19
4. Local Jobs. 80% of the jobs will be created and filled locally. All staff will be invited to join the UFCW (United Food and Commercial Workers Union) that ELEMENT 7: COMMUNITY BENEFITS PLAN
Element 7 has a Labor Peace Agreement (LPA) in place with. We aim to exceed the ‘Living Wage’ and will provide a range of benefits, as explained in our initial submission.
5. Additional Community Benefits. Element 7 will create a range of additional benefits for the City, community, and constituents of Mendota, as addressed below.
1. Community Identity
Mission Build and support the unique local community
identity
Annual Budget Estimated spend of $300,000 annually on local suppliers, tradesmen and staff
Local Product and Supplier Sourcing Program
Small businesses like Element 7 contribute to the identity of the local community in myriad ways — from “from interpersonal relationships to local government to the economy.” They help preserve an important history that is crucial to the local townships, enhancing the bonds of business relationships, and shaping the character of the people who live there while making new connections with everyday individuals passing through for the first time. Element 7 will source materials, services, equipment and team members locally, where possible. Local sourcing seeks to promote and support the vibrant local small business economy and community.
We are very interested in working with local businesses and would look to form a pool of local business engagements across several industries that supply at least 75% of our local building, construction, equipment, repairs and maintenance needs on an ongoing basis.
2. Community Involvement
Mission Create and execute plans that drive meaningful
local change and impact
Annual Budget Minimum spend of $50,000 annually with pool of local non-profits given equity in Element 7 business
(pool of equity created with stock issued)
As local businesses generally have a greater ability to interact with customers on a more personal level than large corporations, they are typically more cognizant of the impact they have on their neighbors and surrounding businesses. More importantly, they can also inspire and impact change, development, and a stronger sense of financial independence with customers and the broader community.
ELEMENT 7: COMMUNITY BENEFITS PLAN
Element 7 Cares
The foundation of our community and local efforts is our Element 7 Cares program which seeks to do four critical things in each community we operate. Our Mission is to:
1. Integrate as seamlessly and authentically as possible into the local community;
2. Change opinions through education, consistency, and reliability;
3. Get involved with local small businesses, non-profits and other community groups and programs; and
4. Be active in improving the overall local community economically and socially.
To bring meaning to our intent to create these facilities, Element 7 will be committing up to $50,000.00 annually (based on projected revenue) to the ELEMENT 7 CARES program for the purposes of actively building and creating facilities that contribute towards local community development.
3. Community Health
Mission Enhance and develop the health of the local
community through education and engagement.
Annual Budget $10,000
When was the last time you walked into a large-chain local store and the owner or staff greeted you by name? Local enterprise businesses build a sense of community identity. Generally, there is a small-town feeling that people feel when they walk into a local business where the staff is polite, the owner is friendly and helpful, and the unique products and services offered create a strong bond with clientele.
Being a Good Business Neighbor
Element 7 believes that having good relations with the immediate business community is important and as such, we will be creating an outreach program to actively engage with our immediate business neighbors on both an alwaysavailable and formalized twice a year basis. We are committed to creating a strong sense of community and business health around our Facility, regularly consulting and engaging with local business neighbors.
This program will be enacted to all businesses within 500-feet of Element 7. Outreach efforts will include:
• If Element 7 is successful in its Application, a personal visit from the Licensees to each business within 21-days of being awarded a Permit.
ELEMENT 7: COMMUNITY BENEFITS PLAN
• Creating an email database of all businesses within the 500 feet radius and sending them a twice-annual email offering news of the cannabis industry AND Element 7 business, while asking for proactive feedback on better business and community relations. All businesses will be given the name and phone number of Element 7 Community Relations Manager (Local Manager). • Inviting businesses to attend a Business Feedback and Community Management Forum twice a year which will be hosted at a suitable venue in the proximate area. Additionally, residents within 500-feet of Element 7 will also be included and will receive our Community Relations Officers contact information.
• Creating a dedicated email address for priority feedback – [email protected]
• Designating one of our Senior Managers as the Community Relations Officer at Element 7 (Local Manager).
• During the first year of operations, Element 7 will attend quarterly meetings with the County to discuss costs, benefits, and other community issues.
Community Engagement Events
This is a historic time in the United States and across the globe. As cannabis legalization continues, more and more people are bringing this incredible plant into their lives. The negative stigma surrounding this wonder drug is beginning to subside as people are realizing its enormous healing benefits. Element 7 believes that education is critical in helping communities understand the power that this curative medicinal treatment can bring to people’s lives. A recent study from BDS Analytics shows that cannabis users “are not only more successful; they’re more satisfied.” Cannabis use also provides other life-enhancing benefits such as:
• Reduced stress levels
• Lower blood pressure
• Decreased inflammation
• Boosted metabolism
• Improved lung health
Only by disseminating accurate information through education will the normalizing of cannabis become reality. We believe that an informed public that is provided with credible, reliable, and evidence-backed information will be empowered to make more intelligent choices concerning cannabis products, and not be swayed by negative propaganda.
Element 7 will proactively engage with Mendota and nearby County residents, business owners, and officials to cultivate lasting and mutually-beneficial connections, sustained by a discreet but visible neighborhood presence. Element 7 seeks to provide tangible benefits to the local community through educational ELEMENT 7: COMMUNITY BENEFITS PLAN
outreach and partnerships with non-profit organizations, municipal agencies, and neighborhood groups.
Community Educational Events
Element 7 is developing a Community Educational Outreach Program that will be held 4 times a year in conjunction with the local municipality cannabis community.
At Element 7 we believe that education and community outreach can change the way cannabis is viewed and helps people understand its benefits. To have a successful cannabis program, we believe that there needs to be an active relationship between the community, cannabis research, and local health and medical practitioners.
To enact such a program, we will be recruiting a panel of specialists and experts onto our team which will help us conduct the outreach program. We would envision each event having 3 specialists that conduct 15-minute lectures with a 30-minute question and answer session at each event. Each event would run for approximately 90-minutes and focus on:
• Myths and Facts of Cannabis
• Customer Treatment Options
• The History of Cannabis
• Latest Research and Medical Findings for Cannabis
• Responsible Use and Management of Cannabis
Our goal is to provide the community with the facts and information that they need to be educated and make informed decisions. It is our goal to educate the community so that they can make the best decisions for themselves and their health. All sessions will be provided at zero cost to the attendees. We will schedule a free shuttle bus for attendees who want to attend the session but may not have transport options.
4. Community Impact
Mission Provide support to those most in need and empower Element 7 staff to create change and take
ownership
Annual Budget Volunteer Hours, Money and Equity
When local employees live and shop in their local communities, money stays in and circulates through the local economy. As stated in The Journal of Extension, “Micro businesses employ local citizens and are an economic engine that causes cash to move through a community’s economy.” Successful business owners enable other businesses to thrive while generating more opportunities for other entrepreneurs.
Businesses with a strong local-enterprise focus tend to have a stronger sense of creating innovative solutions that appeal to local customers’ needs. This will help Element 7 stay more competitive and drive innovation for local customers which we can then transfer to other Element 7 locations where relevant.
ELEMENT 7: COMMUNITY BENEFITS PLAN
Element 7 strives to drive the vast success of cannabis-related commerce at the local level, spurring community reinvestment, workforce development, stakeholder engagement, financial gain, health-related benefits, and public awareness and education. The rapidly evolving emergence of the marijuana industry across the U.S. is both an exciting and challenging prospect, and Element 7 is committed to providing proactive support in establishing and promoting success in the cannabis realm while building ties with local community leaders and entrepreneurs for the betterment of the community.
Micro Loan Program
Element 7 will create a Community Reinvestment Fund, which will be assigned $10,000 upon commencement of operations (and topped up annually). This fund will provide resources to disadvantaged community members who may not have access to traditional forms a financial assistance from banks or lenders. Resources in the form of small loans ranging from $500-$1,000 will be issued to members of the community who are unable to pay their utility bills, car payments or rent.
Staff Volunteer Program
Element 7 will ensure that it gives back to the community by requiring all full-time staff to commit at least 10-hours quarterly to a local cause or charity.
Annually, each staff member will contribute over 40-hours or more of community service beyond the monetary commitments we deliver. These hours will either be used for hands-on volunteering or providing pro-bono support services in the specialist area of the volunteer - business management, design and creative, logistics, processes and systems.
The four-person Element 7 Cares Committee will ensure that the business is held accountable to ensuring that staff commit this time and the General Manager at the Facility will be responsible for tracking all such commitments on a quarterly basis.
Medical Cannabis Discount Programs
As a holistic wellness company focused on inspiring a holistic lifestyle, Element 7 is intent on providing safe and affordable access to its patients, primary caregivers who suffer from diseases, pain, PTSD or simply do not have the means to pay for medical cannabis or cannabis goods.
Seniors, retired veterans, and customers on government assistance need cannabis to treat a wide range of medical and wellness conditions. Element 7 will assist these persons to access cannabis at-cost by working with hospitals and health care centers in close local proximity to our operations.
These partners will be responsible for identifying customers and others that could benefit from cannabis and need financial assistance in securing discounted pricing.
Element 7's discount program will give-away and allow for heavily discounted medical cannabis and cannabis goods for sick or low-income medical patients.
To enroll in the Element 7 discount program patients will either apply on-line or at the Element 7 facility. The process for enrollment will request the following information from applicants:
ELEMENT 7: COMMUNITY BENEFITS PLAN
1. Medical ID Card and proof of low-income for the last two (2) years (via tax return); or
2. Medical ID Card and proof that patients are receiving state benefits such as welfare, HUD or food stamps.
Participants in the discount program can receive 5 grams of mixed shake or a 20% discount on medical cannabis purchased at Element 7 up to 28g total of THC and 50mg of CBD per month. The discount program is specifically for seniors, retired veterans, HIV and AIDS patients, children diagnosed with autism, epileptics, terminally ill patients and low-income patients.
5. Community Repair
Mission Right the wrongs from America’s War on Drugs and the impacted communities
Annual Budget $40,000
Cannabis Criminalization Reform and NDICA Partnership
A founding principle of Element 7 is to see criminal justice reform for non-violent cannabis offenders as public opinion has shifted in its support of reforming federal and state marijuana laws. There is a growing outcry to remove these laws for the following reasons:
• Prohibitionist laws waste billions of dollars criminalizing marijuana users, even for minimal offenses.
• Prohibition fosters an illegal underground marijuana market that fuels organized crime, drug cartels, and gangs.
• Desperately ill patients are not able to access beneficial and critical medical marijuana treatment.
Element 7 also has one of America's leading advocates for criminal justice reform, harm reduction, and marijuana law reform on our team. Lynne Lyman is the California State Director for the Drug Policy Alliance, the nation’s leading organization promoting alternatives to the war on drugs.
Element 7 has partnered at a national level with NDICA (National Diversity and Inclusion Cannabis Alliance) to sponsor and host Expungement Clinics up to 6 times a year, the first of which was recently held in Fresno, California in June 2019.
E7 ONE
Element 7 has an active Social Equity and Local Enterprise Board to oversee the development and implementation of our ever-evolving social equity policies and practices. The Board is comprised of individuals within the community and cannabis industry with varying backgrounds and experiences as well as third-party stake holders, such as representatives of our partner Non-profit organizations, residents of disproportionately impacted communities, and persons with relevant expertise. The Board is responsible for setting social equity goals, devising strategies, and analyzing performance.
ELEMENT 7: COMMUNITY BENEFITS PLAN
At least once per calendar year, the Social Equity Board will produce a report that assesses workplace demographics and other program performance indicators. The Board will use this report to monitor progress towards achieving specified goals and identify the need for strategic action to improve social equity outcomes. The analysis will include percentage breakdowns of positions filled by target underrepresented and disadvantaged populations.
If the analysis indicates persons from underrepresented or disadvantaged populations are not sufficiently represented in our workforce, the Board will develop new strategies to fulfill our commitments to diversity and inclusively. Similar assessments will be performed to ensure that opportunities for advancement and professional development are accessible to all employees on the basis of merit.
Expungement Clinics
Element 7 created history in 2019 when it hosted Fresno's first ever Expungement Clinic. The Expungement Clinic, held in partnership with the Fresno County Public Defender’s Office, NDICA (National Diversity and Inclusion Cannabis Alliance), and Element 7, will pave the way for Fresno residents with minor drug related criminal records to enter the legal and licensed cannabis industry to gain meaningful employment, or as owners and investors.
Expungement clinics are part of the much-needed reparative justice for the harms of cannabis prohibition, which targeted people of color and from marginalized communities. Fresno is one of the hardest hit parts of California for drug related crime. Volunteers from the Fresno County Public Defender’s Office were available at the Clinic to provide free legal assistance to Fresno residents with drug related criminal records, including Prop 64 and Prop 47.
Carmen Romero, attorney with the Fresno Public Defenders Office Clean Slate Program said, “We encourage the community to come take advantage of the opportunity to clear their criminal convictions and begin the overcome the obstacles to better jobs, housing and other benefits.” This was the Fresno Public Defenders first expungement clinic in partnership with NDICA and Element 7 at the national and local level.
7 SECTION H
PROJECT LONGEVITY
SECTION H
PROJECT LONGEVITY
ELEMENT 7: PROJECT LONGEVITY
PROJECT LONGEVITY
Introduction – We Are Local
The success of Element 7 in Mendota will be driven by the adoption of the business by the local residents, patients, and the community it serves. Developing Element 7 Mendota as a local enterprise will accelerate the adoption of the business in the local community and ensure a more sustainable business model that can celebrate long term success.
Element 7 will be a sustainable long-term business in Mendota. We are a private company, intend to stay that way, and will invest human and financial capital in Mendota to build a business that will continue to grow over time. We see ourselves as being active members of the Mendota community for decades. We will integrate ourselves into the local community and have a wonderful track record of achieving this in other communities across California.
Over the last year Element 7 has partnered with many local small business retailers to create a locally owned Element 7 cannabis business in local communities, including:
• Tony Raffoul: A local small business owner in the City of Marina. Element 7 successfully applied for, and secured, permits to operate a vertically integrated business in the City of Marina. Tony will own 25% of the local business and operate the retail component after undergoing a full retail cannabis training program.
• Nicholas Pommier: Prior to forming a partnership with Element 7, Nicholas owned and operated fitness and health businesses in Marin County for 21 years, including Ross Valley CrossFit. Nicholas will own 20% of Element 7 Fairfax, a small town in Marin County.
ELEMENT 7: PROJECT LONGEVITY
• Jennifer Henson: Jennifer joined Element 7 as our head of Retail Operations in Northern California. Just months after joining Element 7, Jennifer presented an opportunity for Element 7 to acquire and operate a struggling cannabis business in the City of Arcata, a small city of 18,000 people in Humboldt County. The owner had health issues, wanted to retire, and Element 7 made Jennifer a part-owner of the business and appointed her as the General Manager.
• Shanti De Luca: Shanti approached Element 7 as a social equity cannabis applicant in the City of San Francisco. For the past decade, Shanti had dreamed of using his hospitality industry experience and passion for craft products, to open and operate a cannabis dispensary in San Francisco.
Element 7 helped to locate a suitable property in Presidio Heights, negotiated a lease with the landlord and committed to being Shanti’s financial partner with Shanti to own 51% of the business and license.
Across California, Element 7 is identifying small communities that we can go into, identify opportunities, create businesses, and support the local economy. At Element 7 we pride ourselves on partnering with good people and local entrepreneurs that want to work hard and build a business and brand. We are local.
We want to find these same people in Mendota and bring them on as partners of the business – allowing them to work hard and become part-owners of Element 7 Mendota.
Sustainable Vertical Business Operations
Element 7 is proposing a vertically integrated cannabis operation in the City of Mendota. The Element 7 team have built a robust business plan with financials that demonstrate that the business could generate significant and sustainable profits in its second year of operations. We have founded our company with a vision and a purpose—namely, to be the most controlled, compliant, taxed, tested and trusted cannabis business in Mendota.
This will be achieved through a mix of vertically integrated operations (which drive price advantage in the market), a clear marketing strategy, a highly desirable retail location, and a merchandising and pricing strategy that ranges from popular products for everyday use through to premium-niche craft products.
We take a long-term approach to financial targets, understanding that if we get the product and people right, profits will follow. Community engagement and localization sit at the heart of our business, and we know that this commitment is critical to the community’s widespread acceptance of the Element 7 business and brand.
To drive our localization initiative, our internal goal is to have 80% of our staff hired from within the City of Mendota and the surrounding County. Staff members will all have a chance to become part-owners of the business through our Stock Incentive Plan.
We are a performance-based organization; however, we will incentivize and reward our employees and executives based on more than just financial performance. Staff ELEMENT 7: PROJECT LONGEVITY
evaluation will include a range of soft targets and measures focused on sustainable business practices and brand development.
We are confident that we have the team, experience, financial backing, business plan, partnerships and alliances, compliant property and business vision to ensure that, if awarded a license by the City of Mendota, we will be the County’s most compliant, controlled, taxed, tested and trusted cannabis operator, setting new standards and benchmarks for how cannabis businesses can and should operate.
Our Business Model is Built on Customer and Industry Insight Element 7’s business model is based on a truly holistic cannabis experience. The brand aims to provide the highest-quality cannabis on the market at an affordable price while simultaneously providing customers with an immersive retail experience in a secure, relaxed, enjoyable, and aesthetically pleasing environment. We also offer the opportunity for customers to experience Element 7’s concept with knowledgeable Bud-Tender services, planned merchandising for a better shopping experience, limited and exclusive drops from brands including WonderBrett, and a range of products specifically catered for the local market based on local data insights.
We have built our business model on four core value propositions:
1. Delivering an Unmatched Cannabis Experience: What sets Element 7 apart from other dispensaries and cannabis operations will be the range of different cannabis experiences we will make available to customers—exclusive product drops, limited editions, and our $20 shelf for budget-conscious customers.
Element 7 is set to become the standard by which all other dispensaries will be measured—an ambitious goal, but one grounded in our deep understanding of the market and its unrealized potential.
2. Being Locally Relevant: While our outlook is global, it is one of our core principles that we remain locally relevant. Every operation that we are involved with has a strong focus on making a positive local footprint. We always attempt to work with local suppliers and show a marked preference for hiring locally. We build strong relationships with local community organizations, establish local business outreach programs, host local community education workshops, and offer a stock incentive plan that turns local employees into owners. We also build advisor teams that seek to understand and balance the needs of the industry and the community.
3. Respecting Diversity and Accessibility: Just because we offer a premium product, that does not mean we have to be exclusive. We appreciate that The City of Mendota is a diverse, eclectic community, which is why Element 7 will offer a range of products including high-quality yet affordable cannabis products through to more exclusive premium ranges. Our businesses have never and will never discriminate on the basis of age, sex, race, religion, disability, or sexual orientation. Our hiring practices will create a team that is representative of Mendota’s vibrant and diverse community.
ELEMENT 7: PROJECT LONGEVITY
4. Winning with Technology and Data: We have formed two strategic alliances that will enable us to be one of the highest-performing retail businesses in the state.
We have partnered with BRIGADE, which holds the global exclusive license to Weedmaps customer and digital data, and with Ready Cart, a seven-year-old e-commerce company that created and operates BURPY, one of North America’s best food delivery companies. Combining the strengths of these two alliances will give us a better understanding of customers than any other cannabis company in California, and it will give us access to a highly responsive technical platform with which we can efficiently manage and fulfill customer orders. We are also proud to partake in the BETA launch of Cura AI’s platform that provides personalized, predictive and precise customer and patient focused cannabis product recommendations, recommended administration, use and dosage, as well as feedback driven insight that is taken directly from customers and patients who connect with Element 7 through Cura AI. Element 7 will be the first West Coast cannabis company to utilize Cura AI in its retail operations.
Summary
We are confident that we have the team, experience, financials, and consumer understanding in place to deliver a sustainable, long-term partnership to the City and community of Mendota. We will generate jobs, taxes, and economic development that builds, enhances, and drives forward the City of Mendota, creating a vibrant community built on trust, hard-work, and an unwavering commitment to continuously improving our business and relationship with our customers.
We believe that Element 7 is the optimal partner for the City of Mendota for a cannabis dispensary. We have the experience, track record, team, financing and funding, industry partnerships, understanding and vertical integration model to ensure we are successful, sustainable, and here for the long journey ahead.
MMM WOD'VOLZE
P R O P O S E D
B Y E T H A N
P E R E Z
WWW.E7CA.COM
EXHIBIT EXHIBIT 44
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1 [PROPOSED] ORDER FOR: 1. APPOINTMENT OF RECEIVER; AND 2. PRELIMINARY INJUNCTION 092568\3\180105066.v1
TARTER
KRINSKY & DROGIN LLP
1880 CENTURY PARK EAST, SUITE 1104
LOS ANGELES, CALIFORNIA 90067
TELEPHONE (424) 330-8580 • FACSIMILE (315) 512-1465
TYLER R. DOWDALL, State Bar No. 258950
TARTER KRINSKY & DROGIN LLP
1880 Century Park East, Suite 1104
Los Angeles, California 90067
Telephone: (424) 330-8580
Facsimile: (315) 512-1465
E-Mail: [email protected]
Attorneys for Plaintiff Nug Inc., a Nevada corporation.
SUPERIOR COURT OF THE STATE OF CALIFORNIA
FOR THE COUNTY OF LOS ANGELES, SANTA MONICA COURTHOUSE
NUG INC., a Nevada corporation,
Plaintiff,
v.
ELEMENT 7 INC.; ELEMENT 7, CA
LLC; ELEMENT 7 CHULA VISTA ONE,
LLC; ELEMENT 7 MENDOTA, LLC;
ELEMENT 7 WILLITS, LLC; ELEMENT
7 SF2 LLC; E7 SALINAS, LLC; PH
INVESTMENTS GROUP, LLC; E7
NAPA CITY, LLC; ELEMENT 7
REDWOOD CITY, LLC; ELEMENT 7
CATHEDRAL CITY, INC.; ELEMENT 7
FRESNO, LLC; ELEMENT 7 SF1, LLC;
ELEMENT 7 SF4 LLC; E7 MORENO
VALLEY, LLC; ELEMENT 7 NEEDLES
LLC; ELEMENT 7 PARLIER LLC; AND
ELEMENT 7 GUADALUPE LLC; and
Does 1 – 100, inclusive,
Defendants.
CASE NO. 25SMCV04499
[PROPOSED] STIPULATED ORDER
FOR:
1. APPOINTMENT OF
RECEIVER; AND
2. PRELIMINARY INJUNCTION
Date: September 11, 2025
Time: 9:00 a.m.
Dept.: M
Assigned for all purposes to the
Honorable Mark A. Young
Dept. M
COMPLAINT FILED: August 29, 2025
TRIAL DATE: None Set
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2 [PROPOSED] ORDER FOR: 1. APPOINTMENT OF RECEIVER; AND 2. PRELIMINARY INJUNCTION 092568\3\180105066.v1
TARTER
KRINSKY & DROGIN LLP
1880 CENTURY PARK EAST, SUITE 1104
LOS ANGELES, CALIFORNIA 90067
TELEPHONE (424) 330-8580 • FACSIMILE (315) 512-1465
ORDER
Plaintiff Nug, Inc.’s Stipulation for the Appointment of a Receiver having been filed in Department M of the Los Angeles Superior Court, Santa Monica Courthouse, the Honorable Mark A. Young presiding, and the Court, having considered the Stipulation of the Parties, and all pleadings on file in this action, the Court hereby Orders as follows:
ORDER APPOINTING RECEIVER
1. Immediate Appointment of Receiver. Kevin Singer of Receivership Specialists (the “Receiver”) is hereby appointed as receiver authorized to take possession, custody, and control of the “Receivership Estate” as defined hereinbelow, effective immediately upon entry of this Order.
2. The Receivership Estate. The terms “Receivership Estate”, “Receivership Property”, and “Collateral” as used herein, shall consist of the following:
i. All assets obtained or owned by or in the possession of Element 7 CA, LLC (“Element 7”), including, without limitation, the following entities owned, controlled, and managed by Element 7 (collectively, referred to hereinafter as the “Element Entities”):
THE ELEMENT ENTITIES
1. ELEMENT 7 CHULA VISTA ONE,
LLC, a California limited liability
company
5. ELEMENT 7 REDWOOD CITY, LLC, a
California limited liability company
2. ELEMENT 7 MENDOTA, LLC, a
California limited liability company
6. PH INVESTMENTS GROUP, LLC, a
California limited liability company
3. ELEMENT 7 WILLITS, LLC, a
California limited liability company
7. ELEMENT 7 CATHEDRAL CITY, LLC, a
California limited liability company
4. ELEMENT 7 SF1, LLC, a
California limited liability company
ii. All assets, real property, personal property (both tangible and intangible), cash, accounts, safety deposit boxes, inventory, products, rights of payment, books and records, contracts, leases, goods, fixtures, tenant improvements, equipment, furnishings, general intangibles, accounting software, computer software, security codes, track and trace software, 1 2
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3 [PROPOSED] ORDER FOR: 1. APPOINTMENT OF RECEIVER; AND 2. PRELIMINARY INJUNCTION 092568\3\180105066.v1
TARTER
KRINSKY & DROGIN LLP
1880 CENTURY PARK EAST, SUITE 1104
LOS ANGELES, CALIFORNIA 90067
TELEPHONE (424) 330-8580 • FACSIMILE (315) 512-1465
of Element 7 and the Element Entities (collectively, the “Businesses” or the “Receivership Defendants”), wherever located, and all accessions, attachments, additions, replacements, and substitutions relating to any of the foregoing, together with all business operations, cannabis dispensary registration certificates, local, municipal, and/or State cannabis licenses, permits, or entitlements to cultivate cannabis, manufacture cannabis or cannabis-based products, to sell cannabis and/or cannabis-based products, and/or to transport cannabis and/or cannabis-based products of the Receivership Defendants (the “Cannabis Licenses”), and all other permits and licenses pertaining to the operations of the Receivership Defendants, of whatever kind and description and wherever situated, and the income, revenues, payments, proceeds and profits derived from the Receivership Defendants, wherever located.
3. The Receiver’s Powers and Duties. The Receiver shall have all powers, duties, and authorities as are provided by law to use, operate, manage, control, and liquidate the Receivership Estate. Without limiting the foregoing, the Receiver’s powers and duties shall include the power and/or duty:
i. To seize, collect, manage, control, preserve, protect, maintain, conserve and/or liquidate the Receivership Property, wherever located;
ii. To enter, gain access, and take possession of the Receivership Defendants’ premises and/or leasehold interests, and operate the businesses of the Receivership Estate;
iii. To demand, collect, and receive all monies, funds, payments, and/or profits owed to the Receivership Defendants, and collect all profits and other income from the Receivership Estate, wherever they may exist;
iv. To notify all necessary local, state, and federal governmental agencies of his appointment as Receiver, including but not limited to, the California Franchise Tax Board, the Internal Revenue Service, and the California Board of Equalization;
v. To contact any agencies or governmental entities with authority over the Receivership Property, and provide all necessary and required information, 1 2
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4 [PROPOSED] ORDER FOR: 1. APPOINTMENT OF RECEIVER; AND 2. PRELIMINARY INJUNCTION 092568\3\180105066.v1
TARTER
KRINSKY & DROGIN LLP
1880 CENTURY PARK EAST, SUITE 1104
LOS ANGELES, CALIFORNIA 90067
TELEPHONE (424) 330-8580 • FACSIMILE (315) 512-1465
including information necessary to secure, renew, extend, transfer, modify, or sell any licenses associated with the Receivership Property; vi. To apply for, obtain, renew, maintain, and/or transfer any licenses and permits the Receiver reasonably believes to be necessary for the operation of the Receivership Property;
vii. Communicate and sign documents with any regulatory agency or governmental agency or entity, including any cannabis regulatory agency, on behalf of the Receivership Defendants. Any such regulatory agency may rely upon this Court’s Order for the Receiver’s authority to act on behalf of the Receivership Defendants.
viii. To take any and all steps necessary to receive, collect and review all mail addressed to the Receivership Defendants, including, but not limited to, mail addressed to each and every one of its Receivership Defendants’ Premises and any post office boxes held in the name of any one of the Receivership Defendants, and, at the Receiver’s discretion, he is authorized to instruct the U.S. Postmaster to re-route, hold and/or release said mail to the Receiver.
Copies of mail reviewed by the Receiver in the performance of his duties will promptly be made available for inspection by Receivership Defendants upon request after review by the Receiver;
ix. To remove the books, records, and assets of Receivership Defendants to a secure location, if required, so that the Receivership Defendants are prevented from altering, destroying, and/or secreting said books, records, and assets; x. To contact each of the customers and vendors of the Receivership Defendants in order to advise them not to send further payments to the Receivership Defendants, and to instruct the customers and vendors to send any and all payments directly to the Receiver;
xi. To market, sell, transfer, collect and/or convey the Receivership Property, or any portion of the Receivership Property, and to hire any brokers, agents, or 1 2
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5 [PROPOSED] ORDER FOR: 1. APPOINTMENT OF RECEIVER; AND 2. PRELIMINARY INJUNCTION 092568\3\180105066.v1
TARTER
KRINSKY & DROGIN LLP
1880 CENTURY PARK EAST, SUITE 1104
LOS ANGELES, CALIFORNIA 90067
TELEPHONE (424) 330-8580 • FACSIMILE (315) 512-1465
personnel, and execute any documents necessary to effectuate such sale, transfer, or conveyance. Any sale, transfer, or conveyance of the Receivership Property, or any portion of the Receivership Property, shall be conditioned on, and subject to, approval by the Court on a noticed motion or ex parte motion (where ex parte notice is warranted under the circumstances); xii. To take possession of, process, demand, cause to extend, and/or transfer and sell the Cannabis Licenses either together or individually (in accordance with any applicable statutes or procedures pertaining to the transfer or sale of such license). Any sale or transfer of the Cannabis Licenses shall be conditioned on, and subject to, approval by the Court on a noticed motion or ex parte motion (where ex parte notice is warranted under the circumstances); xiii. To take possession of all bank accounts, financial accounts, and deposit accounts of any of the Receivership Defendants wherever located, to receive and take possession of any money on deposit in said accounts, and to endorse and sign checks payable to or by the Receivership Defendants; xiv. To conduct the businesses of the Receivership Defendants and pay such amounts as needed to continue the operations of the Receivership Defendants, as deemed necessary by the Receiver at the Receiver’s discretion. In the event that the Receiver determines that it is in the best interest of the Receivership Estate to shut down any of the operations of the Receivership Estate, he shall not do so until after providing five (5) days’ written notice to the Parties and the Court, of the Receiver’s intent to do so;
xv. To do all things and incur all risks and obligations ordinarily and reasonably incurred by owners, managers and operators of similar businesses as the Receivership Defendants; and, provided the Receiver acts in this manner, no risk or obligation so incurred shall be at the personal risk or obligation of the Receiver, but shall be a risk or obligation solely of the Receivership Estate; 1 2
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6 [PROPOSED] ORDER FOR: 1. APPOINTMENT OF RECEIVER; AND 2. PRELIMINARY INJUNCTION 092568\3\180105066.v1
TARTER
KRINSKY & DROGIN LLP
1880 CENTURY PARK EAST, SUITE 1104
LOS ANGELES, CALIFORNIA 90067
TELEPHONE (424) 330-8580 • FACSIMILE (315) 512-1465
xvi. To expend funds to purchase such merchandise, inventory, materials, supplies and services as the Receiver deems necessary and advisable to assist the Receiver in performing its duties hereunder and to pay therefore the ordinary and usual rates and to pay for these things from funds within the Receivership Estate;
xvii. The Receiver is authorized, at the Receiver’s sole discretion, to retain all existing employees, personnel, managers, or independent contractors of the Receivership Defendants, as the Receiver deems necessary to continue the operations of the Receivership Defendants. Conversely, the Receiver is authorized to terminate any employees, personnel, managers, or independent contractors of the Receivership Defendants if the Receiver determines, in the Receiver’s sole and absolute discretion, that it would not be in the best interests of the Receivership Estate to continue such employment or engagement. xviii. To exclude the Receivership Defendants or any persons claiming under or through the Receivership Defendants to manage, possess, control, or operate any of the Receivership Property, or to interfere with the Receiver’s duties and obligations hereunder;
xix. To use and be authorized to use any and all government or regulatory licenses or permits issued to or for the benefit of the Receivership Property, including, inter alia, the Cannabis Licenses, and to communicate directly with the regulatory agencies, including, without limitation, the Department of Cannabis Control and any city or municipality for purposes of undertaking the Receiver’s duties and obligations hereunder;
xx. To take possession of all the books and records, ledgers, financial statements, financial reports and all other business records of the Receivership Defendants, including but not limited to, information contained on computers relating thereto, pertaining to the Receivership Property, wherever located, as the Receiver deems necessary for the proper administration, management and/or 1 2
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7 [PROPOSED] ORDER FOR: 1. APPOINTMENT OF RECEIVER; AND 2. PRELIMINARY INJUNCTION 092568\3\180105066.v1
TARTER
KRINSKY & DROGIN LLP
1880 CENTURY PARK EAST, SUITE 1104
LOS ANGELES, CALIFORNIA 90067
TELEPHONE (424) 330-8580 • FACSIMILE (315) 512-1465
control of the receivership estate, but said books and records shall be made available to the Receivership Defendants, their agents, servants, employees or its representatives, and all persons or entities acting under or in concert with any one of the Receivership Defendants, as is reasonably necessary; Receivership Defendants shall provide any usernames, passwords, security questions to access any systems/online portals, etc., necessary to operate the business or Receivership Property;
xxi. The Receiver is authorized, at its sole discretion, to engage and hire any and all security related personnel;
xxii. The Receiver may use any federal or state taxpayer identification numbers relating to the Receivership Defendants and the Receivership Estate for any lawful purpose relating to the Receivership Estate, and/or his duties hereunder; xxiii. To execute and prepare all documents and to perform all acts, either in the names of the Receivership Defendants, or in the Receiver’s own name, which are reasonably necessary to preserving, protecting, managing, controlling, and/or liquidating the Receivership Property;
xxiv. Conditioned on and subject to prior approval from the Court on a noticed or ex parte motion brought by the Plaintiff, upon the sale and/or after foreclosure, or a notice in accordance with Article 9 of the Uniform Commercial Code, or a notice that there has been some other settlement agreement between Plaintiff and the Receivership Defendants, the Receiver shall immediately turn over possession, custody, and control of the Receivership Property that was the subject of any foreclosure, sale, or settlement to either Plaintiff or to the successful purchaser, whichever is appropriate. Upon such turnover of possession, the Receiver shall then be divested of possession, custody, and control of the applicable Receivership Property and, if consistent with existing law, the Receiver shall have no further responsibility or liability as to the applicable Receivership Property. To the extent that the Receiver is directed 1 2
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8 [PROPOSED] ORDER FOR: 1. APPOINTMENT OF RECEIVER; AND 2. PRELIMINARY INJUNCTION 092568\3\180105066.v1
TARTER
KRINSKY & DROGIN LLP
1880 CENTURY PARK EAST, SUITE 1104
LOS ANGELES, CALIFORNIA 90067
TELEPHONE (424) 330-8580 • FACSIMILE (315) 512-1465
to turn over the Receivership Property pursuant to this paragraph, the Receiver may withhold funds sufficient for the payment of all outstanding receivership costs of administration through the expected termination of the receivership.
To the extent that there are insufficient funds for that purpose, the Receiver may require that Plaintiff or the successful purchaser provide sufficient funds for the payment of all outstanding receivership costs of administration through the expected termination of the receivership prior to turnover.
4. Assistance by Law Enforcement and Locksmiths. The Receiver, as agent of the Court (and only when the Receiver deems absolutely necessary), shall be entitled to the assistance of law enforcement officials when taking possession of the Receivership Property, or at any other time during the term of the Receivership such assistance is necessary to preserve the peace and protect the Receivership Estate. This Order shall be presented to local law enforcement, including police, sheriff, or marshal, and law enforcement will carry out the terms of this Order to assist the Receiver in taking possession of the Property without further Court intervention or order.
i. Locksmith/Entry to Property. The Receiver shall further be entitled to engage a locksmith for the purposes of gaining entry to any property that is the subject of this receivership (including any safes, cabinets, closets, storage facilities, lockers, vaults, etc.) and through any security system, in order to obtain any property, assets or documents to which the Receiver is entitled pursuant to this Order. The Receiver may have locks or security codes changed, or have keys created that will work for the existing locks.
5. Receiver’s Oath and Bond. Before performing his duties, the Receiver shall execute a Receiver’s oath and file a bond in the sum of $10,000, conditioned upon the faithful performance of the Receiver’s duties. The bond shall be from a surety approved by the Court and the oath and bond shall be filed in this Department. 1 2
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9 [PROPOSED] ORDER FOR: 1. APPOINTMENT OF RECEIVER; AND 2. PRELIMINARY INJUNCTION 092568\3\180105066.v1
TARTER
KRINSKY & DROGIN LLP
1880 CENTURY PARK EAST, SUITE 1104
LOS ANGELES, CALIFORNIA 90067
TELEPHONE (424) 330-8580 • FACSIMILE (315) 512-1465
6. Receivership Fees and Costs.
i. The Receiver may charge for the Receiver’s services at the Receiver’s standard billing rate of $350.00 per hour, billed at a minimum of 0.1 per hour. Associates at the Receiver’s office, including Senior Project Managers, may charge $295.00 per hour, Project Managers may charge $135.00 to $225.00 per hour, Accountants may charge between $150.00 to $250.00 per hour, Bookkeepers may charge $95.00 per hour, Administrative Staff may charge $85.00 per hour, and Messengers who handle cash may charge $55.00 per hour. Where appropriate, the Receiver will have lower billing.
ii. Without further order of this Court, the Receiver is authorized to employ the services of outside accountants, bookkeepers, attorneys, computer consultants, managers, and other professionals in connection with his duties as duly appointed Receiver. The Receiver is authorized to pay for those services in the amount of the normal fees charged by those professionals. In compliance with CRC 3.1180, this includes the engagement of attorneys to represent and assist the Receiver, as requested, with any legal issues, regulatory compliance, transactions, pleading(s), court filings, investigations and appearances
7. Initial Inventory. The Receiver shall, within sixty (60) days of qualification hereunder, file with this Court, an inventory of all property of which the Receiver shall have taken possession pursuant to this Order, and any other property of which the Receiver shall subsequently come into possession;
8. Monthly Reports. The Receiver will prepare and serve monthly reports reflecting the Receiver’s activities, fees and administrative expenses, including fees and costs of accountants and attorneys and other professionals authorized by the Court, incurred for each monthly period in the operation and administration of the Receivership Estate. After ten (10) days following service of each statement, the Receiver may disburse from the Receivership Estate funds, the amount of each statement necessary to pay the Receivership Estate’s expenses, costs, fees, and professionals. Notwithstanding this periodic payment of fees and 1 2
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10 [PROPOSED] ORDER FOR: 1. APPOINTMENT OF RECEIVER; AND 2. PRELIMINARY INJUNCTION 092568\3\180105066.v1
TARTER
KRINSKY & DROGIN LLP
1880 CENTURY PARK EAST, SUITE 1104
LOS ANGELES, CALIFORNIA 90067
TELEPHONE (424) 330-8580 • FACSIMILE (315) 512-1465
expenses, all fees and expenses shall be submitted to the Court for its approval and confirmation, in the form of either a properly noticed interim request for fees, by stipulation of all parties, or in the Receiver’s Final Account and Report.
9. Bank Accounts. To establish bank accounts at any bank the Receiver deems appropriate for the deposit of monies and funds collected and received in connection with his administration of the Receivership estate, at any state or federally chartered banking institution, credit union, or savings association. However, the Receiver shall not be required to put the funds in a federally insured bank account due to cannabis banking restrictions.
10. Utility Providers. The Receiver is authorized to enter into agreements and negotiate with utility providers for and on behalf of the Receivership Estate including the control and right to any and all deposits in possession of such utility providers. No utility or other vendor may terminate service or the provision of other goods or services to the Receivership Estate as a result of the nonpayment of pre-receivership obligations, without prior order of this Court.
11. No Pre-Receivership Obligations. The Receiver is not responsible for payment of any utility bills, unpaid payroll expenses, taxes or other unpaid invoices for services or utilities incurred by, or for the benefit of, the Receivership Defendants or the Receivership Property prior to the Receiver’s taking possession of the Receivership Property.
12. Use of Funds. All monies coming into the Receiver’s possession shall only be expended for the purposes herein authorized, and the balance of funds shall be held by the Receiver pending further order of this Court.
13. Insurance. The Receiver shall determine upon taking possession of the Receivership Property whether in the Receiver’s judgment there is sufficient insurance coverage. With respect to any insurance coverage, the Receiver shall be named as an additional insured on the policies for the period that the Receiver shall be in possession of the Receivership Property. If sufficient insurance coverage does not exist, the Receiver shall immediately notify the parties to this lawsuit and shall have thirty (30) calendar days to procure sufficient casualty and liability insurance for the Receivership Property; provided, 1 2
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11 [PROPOSED] ORDER FOR: 1. APPOINTMENT OF RECEIVER; AND 2. PRELIMINARY INJUNCTION 092568\3\180105066.v1
TARTER
KRINSKY & DROGIN LLP
1880 CENTURY PARK EAST, SUITE 1104
LOS ANGELES, CALIFORNIA 90067
TELEPHONE (424) 330-8580 • FACSIMILE (315) 512-1465
however, that if the Receiver does not have sufficient funds to do so, the Receiver shall seek instructions from the Court with regard to whether insurance shall be obtained and how it is to be paid for. If consistent with existing law, the Receiver shall not be responsible for claims arising from the lack of procurement or inability to obtain insurance;
14. Tax Identification. The Receivership Defendants shall provide the Receiver with all tax identification numbers utilized in connection with the operation of the Receivership Property. The Receiver shall also be entitled to utilize the tax Identification numbers during its operation of the Receivership Estate;
15. Taxes. The Receiver and its agents, managers, employees and professionals are not responsible for any tax filings or any other tax obligations of the Receivership Estate, the Receivership Property, or the Receivership Defendants, and the Receivership Defendants are ordered to fully comply with all Federal, State and Local tax filings and obligations on behalf of the Receivership Property and Receivership Defendants. The Receiver will provide any and all information in its possession to the Receivership Defendants as needed for any tax filings, reporting, audits or other tax related inquiries.
16. Bank Accounts. All banks and financial institutions which hold any Receivership Property accounts or any accounts of the Receivership Defendants, shall turn over all such funds in any accounts to the Receiver upon presentation of a copy of this Order, and shall provide copies of any requested records regarding any accounts to the Receiver.
17. Documents in Receiver’s Possession. The Parties to this action shall be entitled to have access to, and make copies of, documents in the Receiver’s possession at their own expense.
18. Further Instructions. The Receiver or any of the Parties may apply to this Court, on an ex parte basis, for further or other instructions or orders and for further powers necessary to enable the Receiver to perform his duties properly.
19. Discharge of Receiver. Discharge of the Receiver shall require a court order after a properly noticed motion approving the Receiver’s Final Report and Account. 1 2
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12 [PROPOSED] ORDER FOR: 1. APPOINTMENT OF RECEIVER; AND 2. PRELIMINARY INJUNCTION 092568\3\180105066.v1
TARTER
KRINSKY & DROGIN LLP
1880 CENTURY PARK EAST, SUITE 1104
LOS ANGELES, CALIFORNIA 90067
TELEPHONE (424) 330-8580 • FACSIMILE (315) 512-1465
20. Receiver’s Certificates. The Receiver may issue receivership certificates in increments of at least $10,000 bearing interest at ten percent (10%) per annum for up to $250,000 to any person or parties, after first confirming with Plaintiff as to whether Plaintiff intends to fund such receivership certificate(s). All funds loaned to the Receiver pursuant to such receivership certificates shall be deemed to be a lien of first priority which shall be repaid prior to all other encumbrances and claims, other than costs of administration.
21. Limitation of Liability. The Receiver, and his employees, agents, attorneys, accountants, and all other professionals retained by the Receiver, shall have no liability for any obligations, or debts, incurred by the Receivership Defendants or the Receivership Estate.
The Receiver and his employees, agents, attorneys, and other professionals, shall have no personal liability unless such parties shall have acted outside the scope of their authority or committed fraud or gross negligence in the administration of the Receiver’s duties. In any event, no suit shall be maintained against the Receiver and his employees, agents, management companies, attorneys, and other professionals, unless such parties have acted outside the scope of their authority or committed raud or gross negligence in the administration of their respective duties. The Receiver is acting solely in his capacity as a Receiver and no risk, agreement, liability, claim or obligation incurred by the Receiver shall be at the risk or obligation of the Receiver, but is solely and exclusively a risk, agreement, liability, claim or obligation of the Receivership Estate. In no event shall the Receiver and his employees, agents and attorneys personally have any liability or obligations for the debts of the Receivership Estate. The Receiver and his agents shall have the broadest judicial immunity available under applicable law, and such judicial immunity shall extend to all employees, agents, attorneys, professionals, and management companies retained by the Receiver. No individual or entity may sue the Receiver without first obtaining permission to do so from this Court.
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13 [PROPOSED] ORDER FOR: 1. APPOINTMENT OF RECEIVER; AND 2. PRELIMINARY INJUNCTION 092568\3\180105066.v1
TARTER
KRINSKY & DROGIN LLP
1880 CENTURY PARK EAST, SUITE 1104
LOS ANGELES, CALIFORNIA 90067
TELEPHONE (424) 330-8580 • FACSIMILE (315) 512-1465
PRELIMINARY INJUNCTION
IT IS FURTHER ORDERED that:
22. The Receivership Defendants, their officers, members, directors, agents, servants, employees and all persons or entities acting under, or in concert with them or for them, are enjoined from doing any of the following:
i. Interfering, hindering or molesting in any way whatsoever the Receiver in the performance of the Receiver’s duties herein described and in the performance of any duties incident thereto;
ii. Communicating with any regulatory agency regarding the Receivership Property, without the express written consent of the Receiver; iii. Communicating with any lessor to the Receivership Property; iv. Failing or refusing to turnover to or provide the Receiver access to all Business Premises in accordance with the provisions hereof;
v. Transferring any interest in the Receivership Property by sale, pledge, grant of security interest, assignment, invoice or encumbering in any manner thereof;
vi. Removing any Receivership Property from the Business Premises, or wherever else located;
vii. Transferring, concealing, destroying, defacing or altering any of Receivership Defendants’ books and records;
viii. Diverting in any of the proceeds from Receivership Defendants’ accounts receivable, equipment and/or inventory;
ix. Causing any mail addressed to any one of the Receivership Defendants or payments by Receivership Defendants’ Account Debtors to be forwarded to any address other than the Business Premises or any existing post office box or other mailing address in the name of any one of the Receivership Defendants, or otherwise interfering with or intercepting any mail intended for any one of the Receivership Defendants; and
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TARTER
KRINSKY & DROGIN LLP
1880 CENTURY PARK EAST, SUITE 1104
LOS ANGELES, CALIFORNIA 90067
TELEPHONE (424) 330-8580 • FACSIMILE (315) 512-1465
x. Failing or refusing to immediately turn over to the Receiver the Receivership Property and all monies, checks, funds or proceeds relating to the Receivership Property, or failing to make available to the Receiver all books, records, and corporate governance documents of any one of the Receivership Defendants relating to the Receivership Property.
23. The Receivership Defendants, and their respective officers, directors, members, managers, agents, partners, property managers, employees, assignees, successors, attorneys, representatives, and all persons acting under, in concert with, or for them:
i. Shall relinquish and turn over possession of the Receivership Property, including but not limited to all of its assets (including any cash) to the Receiver forthwith upon its appointment becoming effective;
ii. Shall turn over to the Receiver and direct all other third parties in possession thereof to turn over all keys, leases, books, records, books of account, ledgers, operating statements, control and passwords to website(s) and/or web domains, budgets, and all other Receivership Property records relating to the Receivership Property, wherever located, and in whatever mode maintained, including information contained on computers and any and all software relating thereto as well as all banking records, statements and cancelled checks; iii. Shall turn over to the Receiver all documents which pertain to all licenses, permits, or government approvals relating to the Receivership Property and shall immediately advise the Receiver of any social security or taxpayer identification numbers used in connection with the operation of the Receivership Property;
iv. Shall immediately advise the Receiver as to the nature and extent of insurance coverage on the Receivership Property. The parties shall immediately name the Receiver as an additional insured on the insurance policy(ies) for the period that the Receiver shall be in possession of the Receivership Property.
The parties and their agents and representatives are prohibited from canceling, 1 2
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TARTER
KRINSKY & DROGIN LLP
1880 CENTURY PARK EAST, SUITE 1104
LOS ANGELES, CALIFORNIA 90067
TELEPHONE (424) 330-8580 • FACSIMILE (315) 512-1465
reducing or modifying any and all insurance coverage currently in existence with respect to the Receivership Property;
v. Shall cooperate with and reasonably assist the Receiver with respect to its operation of the Receivership Property, including but not limited to promptly responding to any inquiry by the Receiver for information The failure of the Receivership Defendants and any of the Receivership Defendants’ affiliated persons or entities, and their respective agents, officers, managers, employees, directors, representatives, attorneys, and all persons acting under, in concert with, or for them, as well as all persons or parties with actual or constructive knowledge of this Order, to abide by any term or condition of this Order may be, among other things, punishable by contempt.
IT IS FURTHER ORDERED that, in addition to all the powers hereinabove set forth, the Receiver is hereby vested with all the general powers of receivers in cases of this kind, subject to the direction of the Court.
THE COURT ORDERS PLAINTIFF to promptly file a Preliminary Injunction bond under Code of Civil Procedure section 529 in the amount of $10,000.00.
IS IT SO ORDERED.
DATED:
By:
HON. MARK A. YOUNG
JUDGE OF THE SUPERIOR COURT
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TARTER
KRINSKY & DROGIN LLP
1880 CENTURY PARK EAST, SUITE 1104
LOS ANGELES, CALIFORNIA 90067
TELEPHONE (424) 330-8580 • FACSIMILE (315) 512-1465
PROOF OF SERVICE
NUG INC., A NEVADA CORPORATION V. ELEMENT 7 INC, ET AL.
CASE NO. 25SMCV04499
STATE OF CALIFORNIA, COUNTY OF LOS ANGELES
At the time of service, I was over 18 years of age and not a party to this action. I am employed in the County of Los Angeles, State of California. My business address is 1880 Century Park East, Suite 1104, Los Angeles, CA 90067.
On September 11, 2025, I served true copies of the following document(s) described as [PROPOSED] ORDER FOR: 1. APPOINTMENT OF RECEIVER; AND
2. PRELIMINARY INJUNCTION on the interested parties in this action as follows:
SEE ATTACHED SERVICE LIST
BY ELECTRONIC SERVICE: I served the document(s) on the person listed in the Service List by submitting an electronic version of the document(s) to Nationwide Legal, through the user interface at www.nationwidelegal.com.
I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct.
Executed on September 11, 2025, at Los Angeles, California. /s/ Brooke M. Genser
Brooke M. Genser
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TARTER
KRINSKY & DROGIN LLP
1880 CENTURY PARK EAST, SUITE 1104
LOS ANGELES, CALIFORNIA 90067
TELEPHONE (424) 330-8580 • FACSIMILE (315) 512-1465
SERVICE LIST AS TO:
NUG INC., A NEVADA CORPORATION V. ELEMENT 7 INC, ET AL.
CASE NO. 25SMCV04499
ELEMENT 7, INC., a Delaware
Corporation
c/o Josh Black
Email: [email protected]
Registered Agents Inc.
8 the Green, STE R
Dover, Delaware 19901
Defendant in Pro Per
ELEMENT 7 CHULA VISTA ONE, LLC,
a California limited liability company
California Registered Agent Service of
Process 1505 Corporation, Corpnet,
Incorporated
31416 Agoura Rd
Westlake Villages, California 91361
Email: [email protected]
Defendant in Pro Per
ELEMENT 7 MENDOTA, LLC, a
California limited liability company
California Registered Agent Service of
Process 1505 Corporation, Corpnet,
Incorporated
31416 Agoura Rd
Westlake Villages, California 91361
Email: [email protected]
Defendant in Pro Per
ELEMENT 7 WILLITS, LLC, a
California limited liability company
California Registered Agent Service of
Process 1505 Corporation, Corpnet,
Incorporated
31416 Agoura Rd
Westlake Villages, California 91361
Email: [email protected]
Defendant in Pro Per
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18 [PROPOSED] ORDER FOR: 1. APPOINTMENT OF RECEIVER; AND 2. PRELIMINARY INJUNCTION 092568\3\180105066.v1
TARTER
KRINSKY & DROGIN LLP
1880 CENTURY PARK EAST, SUITE 1104
LOS ANGELES, CALIFORNIA 90067
TELEPHONE (424) 330-8580 • FACSIMILE (315) 512-1465
ELEMENT 7 SF2 LLC, a
California limited liability company
California Registered Agent Service of
Process 1505 Corporation, Corpnet,
Incorporated
31416 Agoura Rd
Westlake Villages, California 91361
Email: [email protected]
Defendant in Pro Per
E7 SALINAS, LLC, a
California limited liability company
California Registered Agent Service of
Process 1505 Corporation, Corpnet,
Incorporated
31416 Agoura Rd
Westlake Villages, California 91361
Email: [email protected]
Defendant in Pro Per
ELEMENT 7 SF4 LLC, a
California limited liability company
California Registered Agent Service of
Process 1505 Corporation, Corpnet,
Incorporated
31416 Agoura Rd
Westlake Villages, California 91361
Email: [email protected]
Defendant in Pro Per
ELEMENT 7 NEEDLES LLC, a
California limited liability company
California Registered Agent Service of
Process 1505 Corporation, Corpnet,
Incorporated
31416 Agoura Rd
Westlake Villages, California 91361
Email: [email protected]
Defendant in Pro Per
ELEMENT 7 GUADALUPE LLC, a
California limited liability company
California Registered Agent Service of
Process 1505 Corporation, Corpnet,
Defendant in Pro Per
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TARTER
KRINSKY & DROGIN LLP
1880 CENTURY PARK EAST, SUITE 1104
LOS ANGELES, CALIFORNIA 90067
TELEPHONE (424) 330-8580 • FACSIMILE (315) 512-1465
Incorporated
31416 Agoura Rd
Westlake Villages, California 91361
Email: [email protected]
PH INVESTMENTS GROUP, LLC, a
California limited liability company
3415 California Street
San Francisco, CA 94118,
c/o Robert M. Divito, Manager/Member,
Email: [email protected]
Telephone: (312) 823-7638
Defendant in Pro Per
E7 NAPA CITY, LLC a California limited
liability company
California Registered Agent Service of
Process 1505 Corporation, Corpnet,
Incorporated
31416 Agoura Rd
Westlake Villages, California 91361
Email: [email protected]
Defendant in Pro Per
ELEMENT 7 REDWOOD CITY, LLC;, a
California limited liability company
California Registered Agent Service of
Process 1505 Corporation, Corpnet,
Incorporated
31416 Agoura Rd
Westlake Villages, California 91361
Email: [email protected]
Defendant in Pro Per
ELEMENT 7 CATHEDRAL CITY,
INC, a California Corporation
California Registered Agent Service of
Process 1505 Corporation, Corpnet,
Incorporated
31416 Agoura Rd
Westlake Villages, California 91361
Email: [email protected]
Defendant in Pro Per
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TARTER
KRINSKY & DROGIN LLP
1880 CENTURY PARK EAST, SUITE 1104
LOS ANGELES, CALIFORNIA 90067
TELEPHONE (424) 330-8580 • FACSIMILE (315) 512-1465
ELEMENT 7 FRESNO, LLC, a California
limited liability company
California Registered Agent Service of
Process 1505 Corporation, Corpnet,
Incorporated
31416 Agoura Rd
Westlake Villages, California 91361
Email: [email protected]
Defendant in Pro Per
ELEMENT 7 PARLIER LLC, a
California limited liability company
3415 California Street, San Francisco, CA
94118, c/o Robert M. Divito,
Manager/Member,
Email: [email protected]
Telephone: (312) 823-7638
Defendant in Pro Per
ELEMENT 7 SF1, LLC, a
California limited liability company
California Registered Agent Service of
Process 1505 Corporation, Corpnet,
Incorporated
31416 Agoura Rd
Westlake Villages, California 91361
Defendant in Pro Per
Email: [email protected]
E7 MORENO VALLEY, LLC, a
California limited liability company
California Registered Agent Service of
Process 1505 Corporation, Corpnet,
Incorporated
31416 Agoura Rd
Westlake Villages, California 91361
Email: [email protected]
Defendant in Pro Per
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TARTER
KRINSKY & DROGIN LLP
1880 CENTURY PARK EAST, SUITE 1104
LOS ANGELES, CALIFORNIA 90067
TELEPHONE (424) 330-8580 • FACSIMILE (315) 512-1465
ELEMENT 7, CA LLC, a
California limited liability company
California Registered Agent Service of
Process 1505 Corporation, Corpnet,
Incorporated
31416 Agoura Rd
Westlake Villages, California 91361
Email: [email protected]
Defendant in Pro Per
EXHIBIT EXHIBIT 55
T I M O T H Y J O N E S *
M I C H A E L S . H E L S L E Y
R I L E Y C . W A L T E R
P A T R I C K D . T O O L E
S C O T T D . L A I R D
J O H N P . K I N S E Y
K U R T F . V O T E
R O B E R T E . D O N L A N
T R O Y T . E W E L L
J A Y A . C H R I S T O F F E R S O N
A M A N D A G . H E B E S H A * *
P E T E R M . J O N E S†
J E F F R E Y B . P A P E†
M A R I S A L . B A L C H †
D E B O R A H K . B O Y E T T
S T E V E N K . V O T E
N I C O L A S R . C A R D E L L A
G I U L I O A . S A N C H E Z
K A T H L E E N D . D E V A N E Y
C R A I G A . C A R N E S , J R . †
* A l s o a d m i t t e d i n W a s h i n g t o n
**
***
A l s o a d m i t t e d i n I d a h o
E m e r i t u s
† O f C o u n s e l
†† A l s o a d m i t t e d i n T e x a s
WANGER JONES HELSLEY PC
A T T O R N E Y S
265 EAST RIVER PARK CIRCLE, SUITE 310
FRESNO, CALIFORNIA 93720
AND
400 CAPITOL MALL, SUITE 2550
SACRAMENTO, CALIFORNIA 95814
M A I L I N G A D D R E S S
P O S T O F F I C E B O X 2 8 3 4 0
F R E S N O , C A L I F O R N I A 9 3 7 2 9
T E L E P H O N E
( 5 5 9 ) 2 3 3 - 4800
F A X
( 5 5 9 ) 2 3 3 - 9330
W e b s i t e :
w w w . w j h a t t o r n e y s . c o m
W r i t e r ’ s E-M a i l A d d r e s s :
h c a s t r o@ w j h a t t o r n e y s . c o m
S H A W N D A M . G R A D Y †
E T H A N E . M O R A†
B E N J A M I N C . W E S T
H U N T E R C . C A S T R O
S T E P H A N I E M . H O S M A N
I A N J . Q U I N N††
K E V I N W . B U R S E Y
R A C H E L L . P O M B O
D A N I E L J . F R E A
C O L L E E N E . L I T T L E
D A N I K A E . J O N E S
J E S S I C A L . V I V E D
J O S H U A P . J E N D I A N
R A C H E L L . A L S T R O M
H A N N A H L . R A V I Z Z A
P A Y T O N D . D O L E N A R
N I N A M . A L V A R A D O
O L I V E R W . W A N G E R * * *
L E G A L A D M I N I S T R A T O R
L Y N N M . H O F F M A N
January 27, 2026
VIA CERTIFIED MAIL
ELEMENT 7 MENDOTA LLC
645 West 9th Street
Unit #110-631
Los Angeles, CA 90015
Attention: Robert M. DiVito, Jr.
ELEMENT 7 LLC
4612 Glencoe Avenue, #4
Marina Del Rey, CA 90292
Attention: Sheila Merchant Esq.
RECEIVERSHIP SPECIALISTS
11500 W. Olympic Blvd
Suite 530
Los Angeles, California 90064
Attention: Kevin Singer; Jenni Medina
Re: Notice of Default and Demand for Cure
City of Mendota Development Agreement – Element 7
To Whom It May Concern:
My office represents the City of Mendota (“City”) with John P. Kinsey serving as its City Attorney. I am writing in connection with the May 25, 2021, Development Agreement between ELEMENT 7 MENDOTA LLC (“Developer”) and the City, concerning Developer’s operation of a cannabis retail operation at 796 Oller Street, Mendota, CA 93640.
Developer is currently in default of the Development Agreement for failing to pay the Public Benefit Fees due to City in the following amounts:
▪ $48,731.52 remaining due to the City for 2023 payment obligations. ▪ $59,173.82 remaining due to the City for 2024 payment obligations. ▪ $62,632.00 due to the City for 2025 payment obligations.
WANGER JONES HELSLEY PC
January 27, 2026
Agreement, §§ 4.2-4.6.) Pursuant to Article 8 of the Development Agreement, the City demands Developer cure this default by paying the City all outstanding amounts due within thirty-six days of the date of this notice. Such deadline to cure Developer’s default expires at 5:00 p.m. on March 4, 2026. Enclosures:
cc: John P. Kinsey, City Attorney, City of Mendota — [email protected] Cristian Gonzalez, City Manager, City of Mendota — [email protected] Nora Valdez, Finance Director, City of Mendota — [email protected]
CITY OF MENDOTA
“Cantaloupe Center Of The World”
Date: October 6, 2025
Summary Due
Name: Element 7
Address: 796 Oller Street
Mendota, CA 93640
Attn: Legal Department
Description Payment Amount Amount Due
2023 $ 48,731.52 2024 $ 59,173.82 2025 $ 46,974.00 2025 4th Quarter Due December 1, 2025 $ 15,658.00
Total $ - $ - $ 170,537.34
Please make payable to City of Mendota. If you have any questions, please contact City Hall at (559) 655-3291. Thank you.
643 Quince Street Mendota, California 93640
Telephone: (559) 655-3291 Fax: (559) 655-4064 cityofmendota.com TDD/TTY 866-735-2919 (English) TDD/TTY 866-833-4703 (Spanish The City of Mendota is an equal opportunity provider and employer
CITY OF MENDOTA
“Cantaloupe Center Of The World”
Date: October 6, 2025
Bill To:
Name: Element 7
Address: 796 Oller Street
Mendota, CA 93640
Attn: Legal Department
Description Date Payment Amount Amount Due
2025
4th Quarter Payment SQUAREFOOTAGE @2527 $ 3,158.00 4th Quarter Payment ANNUAL PAYMENT $ 12,500.00
$ - $ 15,658.00 | $ 15,658.00
Due December 1, 2025 Please make payable to City of Mendota. If you have any questions, please contact City Hall at (559) 655-3291. Thank you.
643 Quince Street Mendota, California 93640
Telephone: (559) 655-3291 Fax: (559) 655-4064 cityofmendota.com TDD/TTY 866-735-2919 (English) TDD/TTY 866-833-4703 (Spani The City of Mendota is an equal opportunity provider and employer
CITY OF MENDOTA
“Cantaloupe Center Of The World”
Date: October 6, 2025
Bill To:
Name: Element 7
Address: 796 Oller Street
Mendota, CA 93640
Attn: Legal Department
Description Date Payment Amount Amount Due
2025
1st Quarter Payment SQUAREFOOTAGE @2527 $ 3,158.00 ist Quarter Payment ANNUAL PAYMENT $ 12,500.00 2nd Quarter Payment SQUAREFOOTAGE @2527 $ 3,158.00 2nd Quarter Payment ANNUAL PAYMENT $ 12,500.00 3rd Quarter Payment SQUAREFOOTAGE @2527 3,158.00 3rd Quarter Payment ANNUAL PAYMENT f 12,500.00 $ - 3 46,974.00 | $ 46,974.00
Due Upon Receipt Please make payable to City of Mendota. If you have any questions, please contact City Hall at (559) 655-3291. Thank you.
643 Quince Street Mendota, California 93640
Telephone: (559) 655-3291 Fax: (559) 655-4064 cityofmendota.com TDD/TTY 866-735-2919 (English) TDD/TTY 866-833-4703 (Spani The City of Mendota is an equal opportunity provider and employer oO Co YN DN AH Se WD NY FH BO HN NY NY NO NO NO ND ee i ret kh tet co es 2 2 > > oo > © © > ©) i — ©) sO oi)
PROOF OF SERVICE
My business address is 265 E. River Park Circle, Suite 310, Fresno, California 93720. I am employed in Fresno County, California. I am over the age of 18 years and am not a party to this case, On the date indicated below, I served the foregoing document(s) described as: NOTICE OF DEFAULT, DEMAND LETTER, CITY OF MENDOTA DEVELOPMENT AGREEMENT — ELEMENT 7 on all interested parties in this action by placing a true copy thereof enclosed in sealed envelope(s) addressed as follows:
ELEMENT 7 MENDOTA LLC RECEIVERSHIP SPECIALISTS 645 West 9th Street 11500 W. Olympic Blvd Unit #110-631 Suite 530 m ; Los Angeles, California 90064 - Los Angeles, CA 90015 Attention: Kevin Singer; Jenni Medina Attention: Robert M. DiVito, Jr.
ELEMENT 7 LLC
4612 Glencoe Avenue, #4
Marina Del Rey, CA 90292
Attention: Sheila Merchant Esq.
x
(BY U.S. MAIL) I am readily familiar with the business’ practice for collection and processing of correspondence for mailing, and that correspondence, with postage thereon fully prepaid, will be deposited with the United States Postal Service on the date noted below in the ordinary course of business, at Fresno, California. (BY PERSONAL SERVICE) I caused delivery of such envelope(s), by hand, to the office(s) of the addressee(s).
(BY ELECTRONIC SERVICE) C.C.P. § 1010.6 and California Rules of Court, Rule
2.251. Based upon a Court Order, Local Rules of Court, or an agreement of the parties to accept service by e-mail or electronic transmission, I caused the documents to be sent to the person(s) listed above through on the parties listed above who are signed up for electronic service. I did not receive, within a reasonable time after the transmission, any electronic message or other indication that the transmission was unsuccessful. (BY OVERNIGHT COURIER) I caused the above-referenced envelope(s) to be delivered to an overnight courier service for delivery to the addressee(s).
EXECUTED ON January 27, 2026, at Fresno, California.
(STATE) I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct.