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, valued at a deemed price of at least CAD$2.30 per share, alongside a cash finder’s fee of $258,750.
• 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, aiming to vertically integrate Hydreight’s mobile clinical network with pharmaceutical supply chain capabilities.

Key Details

• Transaction Structure: Hydreight acquires an initial 5% membership interest in Perfect Scripts LLC.
• Consideration:
  • Equity: 2,250,000 common shares of Hydreight Technologies Inc.
  • Share Price: Deemed price equal to the greater of CAD$2.30 per share or the lowest price permitted by TSX Venture Exchange policies.
  • Cash Fee: $258,750 paid to a finder, representing 5% of the deemed value of the transaction.
• Strategic Rights & Options:
  • Hydreight and Perfect Scripts will partner to launch a 503B pharmacy in the U.S.
  • Hydreight receives the lowest pricing for all products sold by Perfect Scripts or its subsidiaries.
  • Hydreight holds a right to maintain pro rata interest and acquire up to an aggregate 40% interest in Perfect Scripts, subject to conditions.
• Vesting and Restrictions:
  • Compensation shares vest in 25% increments every 1.5 months, fully vesting 6 months post-issuance.
  • Sale restriction: 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.
  • Statutory hold period of four months applies under Canadian securities laws.
• Counterparty Profile (Perfect Scripts LLC):
  • Parent company of PerfectRx LLC (503A retail dispensing pharmacy in Iowa), PerfectionRx LLC (30,000 sq ft licensed pharmacy/distribution center in Florida), and PerfectRx (nationally licensed, HIPAA-compliant mail-order pharmacy).
  • Operates proprietary technology "PerfectOS" for digital prescription intake and inventory integration.
  • Capacity to process over 150,000 prescriptions per day.
  • Plans to open a new location in the Dallas-Fort Worth metropolitan area in 2025.
• Closing Conditions: Subject to approval from the TSX Venture Exchange and other customary conditions; closing date to be mutually agreed upon.

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.”