Settlement Payable-Related Party

12 Months Ended

Dec. 31, 2022

Note 9 – Settlement Payable-Related Party

At December 31, 2022 and 2021, the settlement payable related party balance consists of the following:


Noteholder	December 31, 2022		December 31, 2021
Investor Three		615,000		615,000
Settlement payable	$	615,000	$	615,000

Investor Three

In December 2015, the Company entered into a Revenue Share Agreement for $750,000 that was recorded as “advances on agreements” liability. As per the Revenue Share Agreement, in the event that, for the period from February 5, 2016, through the three-year anniversary of the Effective Date, if Lessee fails to pay the Company any Fixed Minimum Rent, the Company shall be required to pay to Investor Three, in full, Investor Three’s share each month until the Company has paid Investor Three an aggregate of $825,000 under this Revenue Share Agreement. Thereafter, the Company shall have no further obligations or responsibilities to Investor Three in connection with this Revenue Share Agreement. Due to the above clause, by reason of defaults on the DHS Project (as defined elsewhere herein), an additional penalty of $75,000 was incurred which was recorded as deferred finance cost. During the fiscal year 2018, the Company reduced $200,000 of principal by transferring land to Investor Three. During the fiscal year 2018, the Company also recorded a loss on settlement of debt in the consolidated statements of operations increasing the balance by $97,800 to $615,000 at December 31, 2018. There has been no activity during the year ended December 31, 2022. This balance remains outstanding as of December 31, 2022 and 2021, and is classified as settlement payable-related party on the Company’s consolidated balance sheets.

PINEAPPLE, INC. 10-K