Hydreight Technologies Signs Definitive Agreement to Acquire 5% Equity Stake in Perfect Scripts, LLC, with Option to Increase to 40%, and Establish Strategic Partnership

Executive Summary

• Hydreight Technologies Inc. has entered into binding definitive agreements to acquire an initial 5% membership interest in Perfect Scripts LLC, a strategic partner in the pharmaceutical distribution and compounding space.
• The transaction involves the issuance of 2,250,000 common shares of Hydreight to Perfect Scripts, with a deemed share price of at least CAD$2.30.
• The partnership establishes a 503B pharmacy in the United States, grants Hydreight lowest pricing on products, and provides an option to acquire up to 40% total interest in Perfect Scripts.

Key Details

• Transaction Structure: Hydreight acquires an initial 5% membership interest in Perfect Scripts LLC.
• Consideration: Payment is made via 2,250,000 common shares of Hydreight ("Hydreight Compensation Shares").
• Share Valuation: Each share is issued at a deemed price equal to the greater of CAD$2.30 per share or the lowest price permitted by TSX Venture Exchange policies.
• Strategic Rights:
  • Hydreight receives the lowest pricing for all products sold or made available by Perfect Scripts or its subsidiaries.
  • Hydreight retains the right to maintain its pro rata interest in Perfect Scripts.
  • Hydreight holds an option to acquire up to an aggregate 40% interest in Perfect Scripts, subject to conditions.
• Finder’s Fee: The Company will pay a cash finder’s fee of $258,750 (5% of the deemed value of the Transaction).
• Vesting Schedule: The Hydreight Compensation Shares vest in 25% increments every 1.5 months, becoming fully vested 6 months following issuance.
• Restrictions on Sale: Perfect Scripts may sell a maximum number of shares equal to 5% of the five-day average daily trading volume of Hydreight on the Exchange for the immediately prior five trading days.
• Regulatory Conditions: Closing is subject to approval from the TSX Venture Exchange and other customary conditions.
• Securities Exemptions: Shares issued under National Instrument 45-106 and U.S. federal/state exemptions, subject to a four-month statutory hold period in Canada.

Notable Quotes

• Shane Madden, CEO of Hydreight: “This strategic deal locks in a rock-solid pillar for Hydreight’s next stage of growth. By controlling production, distribution, and pricing for key pharmaceuticals, we’re boosting our pharmacy margins, securing a consistent supply chain, and deepening our defensibility with true vertical integration... Bottom line: this is more margin, more protection, and more upside — the kind of infrastructure that expands our product lineup and positions Hydreight for a stronger valuation multiple.”
• Brandon Rainone, Founder and Managing Member of Perfect Scripts: “We’re very happy to be partnering with Hydreight and VSDHOne. Hydreight offers a unique and comprehensive legal and technology framework that we believe represents the future of personal care—and the only truly compliant way to access pharmaceutical products.”