Westwood, Los Angeles, California, July 18, 2019 (GLOBE NEWSWIRE) -- Imaging3, Inc. (OTCQB: IGNG), (“IGNG” or “Imaging3”) today announced that its wholly owned subsidiary, Grapefruit Boulevard Investments, Inc. (“Grapefruit” or the “Company”) has entered into a letter of intent (‘LOI”) with Dogwood Management Group, Inc. (“Dogwood”) (collectively the “Parties”).
The non-binding letter of intent dated as of June 12, 2019 outlines the Parties’ plan for Grapefruit to acquire, and for Dogwood to manage, California licensed and fully compliant retail cannabis dispensaries throughout California which meet the Parties regulatory, operational and financial results requirements. The plan constitutes one avenue for Grapefruit to explore to achieve the retail dispensary acquisition aspect of Grapefruit’s comprehensive corporate goal to become a fully vertically integrated seed to sale cannabis and CBD product company. Under the terms of the LOI, Dogwood will have primary responsibility to identify and conduct due diligence on prospective acquisition candidates. Grapefruit will have primary responsibility to structure the acquisition of any legal dispensary by cash or IGNG stock or some combination thereof and to arrange for funding of any such legal dispensary acquisitions. The Parties acknowledge that each acquisition will be negotiated, priced and managed on a case by case basis. Post-acquisition, Dogwood will manage any acquired legal dispensaries in exchange for receipt of 30% of the net operating income of such dispensary.
Grapefruit’s CEO, Bradley J. Yourist, stated: “We continue to press purposefully forward toward our ultimate goal of vertical integration by implementing this initial program to build a network of fully compliant, legal dispensaries by entering into this arrangement with Dogwood which eliminates the necessity of building an in house acquisition staff and dispensary management team and thereby significantly accelerates our legal retail dispensary acquisition program. Dogwood’s CEO Steely Inoue and I, and our respective management teams, will work closely together over the coming months to identify, acquire and successfully manage various retail cannabis dispensaries in both Northern and Southern California. It has always been Grapefruit’s intent to become a fully vertically integrated, seed to sale cannabis and CBD company and our new relationship with Dogwood Management advances that goal. CEO Steely Inoue and his entire Dogwood management team are true cannabis professionals and offer a complete turnkey retail dispensary management program to Grapefruit. Moreover, Dogwood brings over 40 collective years of experience managing some of the most high-profile and profitable retail dispensaries in California. Dogwood is also well versed in planning, designing and operating both indoor and outdoor cannabis cultivation projects and facilities which is relevant because many of the dispensaries we plan to target for acquisition have cultivation facilities attached to their stores. Furthermore, Steely Inoue has 15 years of experience in successfully managing one of the most well respected and highly successful retail dispensaries in Berkeley California. Steely also possesses experience in cannabis related supply chain management, and cannabis sourcing. With this new collaboration between Dogwood and Grapefruit, we have set the stage for Grapefruit to quickly acquire legal, compliant and auditable retail locations in California to rapidly expand Grapefruit’s revenues.”
Potential investors in IGNG’s common shares are cautioned that there can be no assurance that the Company will be able to obtain the financing necessary to achieve its articulated goals and further that even if such financing is obtained that it will be sufficient for the Company to achieve its ultimate goals.
About Grapefruit
Grapefruit Boulevard Investments, Inc. a California corporation (“Grapefruit”) is, as of May 31, 2019, a wholly owned subsidiary of Imaging3, Inc. (“IGNG”) a Delaware corporation whose shares of $.001 par value common stock are publicly traded on the OTCMarkets OTCQB Market under the symbol “IGNG”. IGNG is subject to the reporting requirements of the Securities Exchange Act of 1934 and files annual and quarterly reports pursuant thereto. Grapefruit holds licenses originally issued by the State of California in January 2018 to both manufacture and distribute cannabis products. Grapefruit’s management now owns a controlling interest in IGNG which now owns 100% of Grapefruit’s outstanding shares. As a result, IGNG’s financial reports will consolidate both IGNG’s and Grapefruit’s balance sheet, statement of operation and statement of cash flows and IGNG and Grapefruit will be operated as a single company. IGNG intends to change its name to Grapefruit and to obtain a more appropriate trading symbol as soon as possible. Hereinafter the combined companies will be referred to as “Grapefruit” or the “Company”.
Grapefruit’s corporate headquarters is in Westwood, Los Angeles, California. Grapefruit holds licenses to both manufacture and distribute cannabis products which were originally issued in January, 2018 and is fully compliant with all applicable laws and regulations to operate its cannabis manufacturing and distribution businesses.
The company is well focused on sourcing only the ‘best of the best’ raw cannabis materials to create the highest quality, most-trusted and consistent recreational and medical cannabis products for its customers. Grapefruit is committed to ensuring class-leading quality by rigorously testing the purity and potency of its raw materials throughout the manufacturing process and distribution chain.
Grapefruit owns and operates its fully licensed and compliant ethanol extraction laboratory located in the Coachillin’ Industrial Cultivation and Ancillary Canna-Business Park in Desert Hot Springs, California. The company’s extraction lab produces high quality, cannabis-derived distillate, also known as ‘honey oil,’ from cannabis flower and ‘trim’. THC honey oil is one of base cannabis commodities which serves as the active ingredient in everything from infused edibles and tinctures/creams to the cartridges used in vapes and e-cigarettes. Honey oil often sells on the wholesale marketplace for thousands of dollars per liter, with pricing being dependent on quantity purchased, as well as other market factors such as the availability and cost of the underlying flowers and/or trim.
Grapefruit began its extraction operations in May 2019. Plans are in place to expand its honey oil production through the purchase of additional distillation equipment, which is expected to significantly increase the company’s production capacity by the fourth quarter of 2019. Grapefruit’s extraction lab is fully scalable and expansion will be built-out on a two-acre lot owned by Grapefruit at the Coachillin’ site adjacent to its current manufacturing and distribution operation.
Grapefruit selected the City of Desert Hot Springs for its cannabis extraction laboratory, because the city has created a friendly business environment for cannabis-based manufacturers, including incentives like the absence of taxes on cannabis oil production revenues. This affords Grapefruit a fundamental competitive market advantage over other Honey Oil producers.
The California cannabis regulatory scheme is unique in that it requires all cultivators (cannabis farms) and manufacturers (whether producing oils/distillates, infused edibles, tinctures creams or other cannabis products) to sell their products into the legal cannabis wholesale and retail markets exclusively through licensed distributors such as Grapefruit. Grapefruit initially obtained its California recreational and medicinal cannabis distribution license on January 4, 2018. In May 2019, Grapefruit was granted its provisional distribution license which is renewable annually, thereby cementing the regulatory foundation necessary to rapidly expand its distribution business.
Grapefruit’s distribution license affords it a twofold strategic advantage: first, to market and sell its own cannabis product lines to retailers throughout California; and second, to buy and resell bulk cannabis flowers and trim as well as all other legal cannabis products to properly licensed distributors and/or retailers throughout California.
The Coachillin’ Canna-Business Park, home to Grapefruit’s current operating facilities and adjacent two-acre parcel of land, is a 160-acre, self-contained legally mapped compound providing the Company with a fully permitted and serviced physical plant from which Grapefruit intends to establish a leading position in the booming California cannabis sector. The parcel was purchased by the Company prior to the Park’s full development, and the value of the land the Company owns has increased since it’s acquisition. The Coachillin’ Park’s promoters also plan to position the Park, located only 10 miles north of rapidly growing uptown Palm Springs and less than 15 miles from the site of the Coachella and Stagecoach music festivals as a must-see canna-tourism destination.
Grapefruit’s ultimate goal is to become a vertically integrated, seed-to-sale cannabis and CBD product company serving the California market. Moreover, it plans to roll-out its product lines in other states, such as Nevada, Illinois, Oregon, Colorado and Washington. Grapefruit has plans to build a large, all-inclusive facility that will house a 50,000-square-foot-plus indoor grow canopy, a large extraction laboratory designed to extract both THC and CBD cannabinoids via non-volatile (ethanol) and volatile (butane) processes, a manufacturing space to produce Grapefruit’s vape lines and CBD products, an FDA-certified kitchen for the production of Grapefruit edibles and a distribution facility to sell all products into the entire cannabis market. The indoor grow canopy operation will be outfitted and operated to produce ultra-high-quality flowers and buds, some of which, along with the high quality trim resulting from cleaning and maintaining the grow, will provide biomass necessary to feed the company’s extraction laboratory. Fueled by this hand cultivated biomass, Grapefruit’s lab will continuously produce pesticide and heavy metal-free world class honey oil to both serve as the active ingredient in all of Grapefruit’s branded and unbranded products and meet the projected ever growing demand for high quality honey oil in the California market.
Grapefruit is managed by a team of experts possessing the experience, skill and resources required to succeed in the competitive cannabis marketplace. Founded by brothers Bradley Yourist, CEO, and Daniel Yourist, COO, Grapefruit has expanded to become a group of industry professionals sharing a passion for all things cannabis. Both the CEO & COO are attorneys licensed to practice law the State of California who possess expert cannabis licensing and regulatory expertise and experience, which will allow Grapefruit to deftly navigate the ever changing California regulatory landscape and apply for new cannabis licenses at reduced costs when necessary, rather than having to acquire licenses that are often overvalued and/or pay outside counsel to handle such matters.
Grapefruit also has its own line of cannabis-infused concentrates and edibles. Among the brands now in stores or soon to be launched are:
- Rainbow Dreams is a new lifestyle brand designed specifically for the recreational cannabis marketplace. The Rainbow Dreams brand captures the anything goes party vibe of the 1970s by offering an array of cannabis products, such as a line of vape carts with unique cannabis strains combined with all-natural flavors for a superior no-burn experience. Rainbow Dreams fills an important niche in the marketplace as a top shelf quality product line that is competitively priced.
- Sugar Stoned, which Grapefruit acquired in the winter of 2018, has always been a popular cannabis edibles brand which terminated operations when recreational cannabis became legal and required a license in California. Grapefruit purchased the Sugar Stoned brand in 2019 and it is now a Grapefruit portfolio brand consisting of a premium quality cannabis-infused gummy line with eight different flavors: blue raspberry, cherry, grape, peach, pineapple, sour apple, strawberry and watermelon. Grapefruit intends to expand the brand in the near future through the release of a variety of infused cookies.
Additional Resources
Company websites: https://grapefruitblvd.com/ www.sugarstoned.com
Instagram: https://www.instagram.com/grapefruitlogistics/
About Dogwood
Dogwood’s expertise has been drawn from over 20 years of direct management of premiere cannabis dispensaries. Dogwood has the necessary industry experience to successfully design, develop and operate retail cannabis operations with the highest level of sophistication available. Dogwood is teamed with well-known Bay Area cannabis dispensary to create a leading cannabis retail management group for the acquisition of retail cannabis dispensaries throughout the country.
Safe Harbor Statement
Imaging3 and Grapefruit caution 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 the Imaging3’s business, including, without limitation: the company may not ever obtain FDA approval for any of its devices; the company may not be able to secure the funds necessary to support its product development plans; and the company may not ever achieve the market success to sustain a profitable business. In addition, there are risks and uncertainties related to economic recession or terrorist actions, competition from much larger imaging companies, technological obsolescence, unexpected costs and delays, potential product liability claims, and many other factors. More detailed information about Imaging3 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 and its Quarterly Report on Form 10-Q. 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 Imaging3 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.
Investor Relations Contact:
Bradley J. Yourist
brad@grapefruitblvd.com