Grapefruit USA Inc (GPFT)

[Baruch Lebovits]

10. RELATED PARTY TRANSACTION

The Company has a consulting agreement with the Chief Executive Officer of the Company for compensation of $12,000 per month. The CEO provides services to the Company for management, administrative, marketing, and financial matters pursuant to the consulting agreement terminable on 30 days notice by either party. The consulting agreement commenced on January 1, 2002, and will continue until such time as the Company withdraws the agreement or the CEO resigns. The accrued compensation has been included in amounts due to officer and is payable by the Company on demand.

During the normal course of business, the Chief Executive Officer advances funds to the Company and in turn the Company will reimburse him. These transactions are recorded as due to officer.

The balance of due to officer amounts to $-0- as of September 30, 2009 and $784,210 as of December 31, 2008.

During the nine months ended September 30, 2009, the Chief Executive Officer was paid $1,773,144 of the amount that was owed to him. This amount included adjustments for funds not recorded in 2004 and 2005.


Filing Date: 11/13/2009 Form Type: 10-Q