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Los Angeles & Desert Hot Springs, California, May 07, 2020 (GLOBE NEWSWIRE) -- Grapefruit USA, Inc., a California based cannabis distribution and manufacturing company (OTCPINK “GPFT”) (“Grapefruit” or the “Company”) is announcing today that on Monday May 4, the Company received a total of nine (9) comments from the SEC staff in response to Amendment #2 to the Company’s registration statement on Form S-1 filed on April 22, 2020. The registration Statement was originally filed by the Company on July 25, 2019. The registration statement covers shares to be issued to its institutional investor, Auctus Fund, LLC (the “Investor”) of Boston, MA upon conversions of Convertible Notes (the “Notes”) previously issued to Auctus to be converted to GPFT common stock at approximately 95% of Market and upon exercise of callable cash exercise-only Warrants issued by the Company to Auctus when the Notes were originally issued. Upon effectiveness of the registration statement, which the Company now expects to be declared effective in mid to late May, the Investor is obligated to immediately provide an additional tranche of cash to Grapefruit, and another ninety (90) days later. If all of the Notes are issued and the Warrants called, Grapefruit will have received a total of $10,000,000.00 of proceeds from these financing transactions.
With respect to the prompt SEC response, Bradley J. Yourist, Grapefruit’s CEO, stated, “We were very pleased to receive the SEC comments seven (7) working days after our filing, especially in the current environment. We now expect to have the registration statement declared effective in the very near future which will result in payment to us of additional significant working capital at effectiveness and again ninety (90) days thereafter fueling rapid revenue growth. We are staying on track with our 2020 operating plan.
We expect to publish our first quarter results the week of May 11, 2020.”
Grapefruit’s corporate headquarters is in Westwood, Los Angeles, California. Grapefruit holds California permits and licenses to both manufacture and distribute cannabis products. Grapefruit’s extraction laboratory and distribution facilities are located in the industry recognized Coachillin’ Industrial Cultivation and Ancillary Canna-Business Park in Desert Hot Springs, located on the extension of North Canyon Rd., approximately 14 miles north of downtown Palm Springs. Grapefruit obtained its California cannabis licenses in January 2018 and commenced distribution of cannabis products thereafter. Grapefruit’s vision remains to become a seed to sale, fully vertically integrated ethical and compliant cannabis product Company. To obtain further information on Grapefruit and its operations, please visit its website at https://grapefruitblvd.com/. To learn more about Grapefruit’s Sugar Stoned branded line of cannabis and CBD infused edibles, please visit us at https://sugarstoned.com/.
Safe Harbor Statement
Imaging3 cautions you that any statement included in this press release that is not a description of historical facts is a forward-looking statement. Many of these forward-looking statements contain the words "anticipate," "believe," "estimate," "may" "intend," "expect" and similar expressions. Actual results, performance or achievements could differ materially from those contemplated, expressed or implied by the forward-looking statements contained herein. These forward-looking statements are based largely on the expectations of the company and are subject to a number of risks and uncertainties inherent in Grapefruit’s business, including, without limitation: the company may not ever obtain additional funds necessary to support its business development and growth plans; and the company may not ever achieve the market success to reach or sustain a profitable business. In addition, there are risks and uncertainties related to economic recession or terrorist actions, competition from much larger cannabis companies, unexpected costs and delays, potential product liability claims, and many other factors. More detailed information about Grapefruit and the risk factors that may affect the realization of forward-looking statements is set forth in the Company’s filings with the Securities and Exchange Commission, including the company’s Annual Report on Form 10-K for the year ended December 31, 2019 and its Registration Statement on Form S-1. Such documents may be read free of charge on the SEC’s website at www.sec.gov. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. All forward-looking statements are qualified in their entirety by this cautionary statement, and Grapefruit undertakes no obligation to revise or update this press release to reflect events or circumstances after the date hereof. This caution is made under the safe harbor provisions of Section 21E of the Private Securities Litigation Reform Act of 1995.