For cannabis and CBD investors, there’s a new kid on the block: Imaging3 Inc (OTCMKTS:IGNG). The stock announced its presence in grand fashion on Wednesday, powering over 50% higher on a massive burst in volume. The catalyst was interesting. If you have been following the recent performance of Discovery Gold Corp. (OTCPINK: DCGD), then you probably know the name, Justin Costello. Mr. Costello is the CEO of DCGD as well as being the CEO and Chairman of GRN Funds, one of the more respected and successful private equity names in the cannabis space. On that note, the company just announced that on August 16, 2019 Justin Costello accepted appointment as Grapefruit’s initial non-director corporate advisor and the founding member of its strategic advisory board.
According to the release, “Pursuant to the terms of the Corporate Advisory Services Agreement between Grapefruit and Mr. Costello, his initial term will be for one year and shall automatically renew for successive six month periods subject to the mutual agreement of the parties. Mr. Costello has agreed to advise Grapefruit on a broad range of matters, from capital formation to mergers and acquisitions. Mr. Costello, 39, is considered to be one of the pioneers of the legal cannabis and CBD industry in the United States. He is CEO and Chairman of GRN Funds, an investment firm based in Seattle, Washington, which he established 2014. GRN Funds provides secure banking resources to small and medium-sized businesses throughout the country. Mr. Costello is also the Chairman and CEO of Discovery Gold Corp. (OTCPINK: DCGD). In consideration of accepting his appointment, Mr. Costello will be paid a quarterly honorarium and has been issued four million five hundred thousand restricted shares of the Company’s common stock.” Note that we previewed the coming reverse merger potential here (which is what this looks like).
Imaging3 Inc (OTCMKTS:IGNG) trumpets itself as an overarching structure interested in disruptive business opportunities. One of its most promising segments is Grapefruit, a wholly-owned subsidiary of Imaging3, Inc.
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 cannabis and CBD oil 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 10 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 is to become a seed to sale, fully vertically integrated ethical and compliant cannabis and CBD product Company.
This is a cannabis and CBD play that appears to be pushing for very aggressive market positioning.
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As noted above, IGNG just announced that on August 16, 2019 Justin Costello, CEO of GRN Funds in Seattle, WA, accepted appointment as Grapefruit’s initial non-director corporate advisor and the foundational member of its strategic advisory board.
Naturally, the stock went bonkers to the upside on the announcement, ripping over 50% higher on Wednesday on roughly 10 times the trading volume that has characterized the stock, on average, over the past 3 months of action.
Mr. Costello stated, “I am very flattered and pleased that Brad and Dan Yourist, two very experienced attorneys and cannabis law experts have chosen me to be their initial outside corporate advisor and foundational member of Grapefruit’s strategic advisory board. Brad and Dan’s obvious commitment to compliance with all applicable cannabis laws and regulations matches the commitment of the entities I am associated with and provides the foundation for our decision to work together for the benefit of each other’s enterprises and the legal cannabis, CBD and related enterprises in general. I look forward to a long, mutually beneficial and educational relationship.”
At this time, carrying a capital value in the market of $111M, IGNG has about $50K in cash on the books, which stands against about $4.9M in total current liabilities. The company is pre-revenue at this point. We will update the story again as soon as further details emerge. Sign-up for continuing coverage on shares of $IGNG stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!
Disclosure: we hold no position in $IGNG, either long or short, and we have not been compensated for this article.