Grapefruit USA, Inc. Issues Further Update Concerning Formation of Joint Venture with Canadian Partner to Distribute Hourglass Products; Possible Acquisition
LOS ANGELES and DESERT HOT SPRINGS, Calif., May 20, 2021 (GLOBE NEWSWIRE) -- via InvestorWire – Grapefruit USA, Inc. (OTCQB: GPFT) (“Grapefruit” or the “Company”), a premiere, fully licensed California-based cannabis company, is further updating its March 1, 2021, announcement that the Company had been approached by a Canadian cannabis company to enter into discussions concerning a potential acquisition transaction, that the discussions evolved to include development of a memorandum of understanding (“MOU”) setting forth terms under which the parties could enter into a joint venture to jointly manufacture, distribute and market Grapefruit’s products, including, but not limited to, Grapefruit’s patented disruptive Hourglass™ THC/Cannabinoid time-release delivery cream throughout Canada and that in February the Company signed a Memorandum of Understanding (the “MOU”) with the Canadian partner which set forth the general terms of their agreement to form a new joint venture corporation to manufacture and distribute Grapefruit’s patented, disruptive Hourglass THC/ cannabinoid products, throughout the Commonwealth of Canada including on Indian Reservations and Canadian First Nation Lands, and its March 8, 2021, announcement that the Canadian Partner noticed a special shareholder’s meeting to consider the proposed joint venture and other corporate matters.
Subsequent to March 8, 2021, the Canadian partner’s shareholder’s meeting was delayed and ended up being held on April 29, 2021. At that meeting the Canadian partner’s shareholders elected five directors and approved appointment of a new CEO and CFO. The Canadian partner’s shareholders also approved the acquisition of a Canadian based hemp cultivator. Since the aforementioned corporate actions triggered a change in control of the Canadian partner, the corporate actions require acceptance for filing by the Canadian Stock Exchange (the “CSE”) which is pending. Discussions between the Company and the Canadian Partner have continued during the course of these activities, however, execution of a formal joint venture agreement and further acquisition discussions were postponed pending acceptance of the filing by the CSE, which the Canadian partner expects in the very near future.
Bradley J. Yourist, Grapefruit CEO, commented, “While Grapefruit was, of course, disappointed by the delays occasioned by our counterpart’s corporate action (which were in progress before our discussions commenced), we believe it was in the best long term interests of Grapefruit and its shareholders to accept a pause while the Canadian partner concluded its corporate actions. Now we move forward. As we have stated before, a joint venture may precede without precluding an acquisition. Execution of the MOU moved the entire process forward as we now more clearly understand each other’s overall goals and priorities as well as the capital requirements and legal, regulatory and logistical challenges of finalizing a Joint Venture and/or an acquisition. We expect to bring the process forward to the point of making a decision in the next 30-60 days. Once again, that being said, we wish to emphasize that the discussions reported here, although substantive and largely positive, remain preliminary in nature and may be terminated at any time. Grapefruit will update the public as necessary on any material joint venture or acquisition developments as events proceed.”
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Grapefruit’s corporate headquarters is in Westwood, Los Angeles, California. Grapefruit holds California permits and licenses to both manufacture and distribute cannabis products in the Golden State. Grapefruit’s extraction laboratory and manufacturing 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 Road, approximately 14 miles north of downtown Palm Springs. To obtain further information on Grapefruit and its operations, please visit the Company’s website at https://grapefruitblvd.com/.
Safe Harbor Statement
Grapefruit cautions 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, its Quarterly Report on Form 10-Q for the period ended Sept. 30, 2020, and its Registration Statement on Form S-1/A. 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.
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