Love Pharma (CSE:LUV) Inc said it has entered into a definitive agreement to acquire Doc Hygiene Pharmaceuticals Inc for an aggregate consideration of US$300,000.
The Vancouver-based company said the acquisition is accretive and builds value for shareholders by combining Doc Hygiene's trusted line of personal sanitizer products with its growing line of science-backed nutraceutical and psychedelic products.
"We are thrilled to announce the acquisition of Doc Hygiene," Love Pharma CEO Zach Stadnyk said in a statement. "We are extremely excited about Doc Hygiene's growth potential in the years ahead and firmly believe it will provide a parallel revenue stream to our existing business in over-the-counter products."
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“Through this acquisition, the company now has a strong online eCommerce platform that will strengthen its product offering and ease of operational online sales from both a B2C and B2B standpoint," he added.
Love Pharma said the acquisition will give it access to Doc Hygiene’s associated registered trademarks, online eCommerce sales and marketing platforms, and social media accounts. In addition, it will receive Doc Hygiene's existing inventory of personal sanitizer products, which it negotiated at no cost to the company.
Love Pharma said it will pay for the purchase through the issuance of a convertible promissory note with a principal amount of US$150,000, payable on the fifth year of the date of issuance of the note, at an interest rate of 10% per annum, payable quarterly in arrears.
The principal amount of the promissory note shall be convertible into common shares of the company at a conversion price equal to the lessor of: (a) $0.05 per common share; and (b) the last closing price of the common shares on the Canadian Securities Exchange prior to the conversion of the note. If the conversion price is less than the minimum issue price permitted under the Canadian Securities Exchange policies (or the policies of such other stock exchange on which the common shares are listed for trading from time to time), then the conversion price shall be adjusted to be equal to the minimum price permitted under such policies of $0.05 per share.
As part of the acquisition, Love Pharma will also assume about US$150,000 of Doc Hygiene’s liabilities, it added.
Founded in 2020, Love Pharma’s mission is to bring to market innovative products that enhance sexual health and wellness, while providing an improved quality of life. It holds exclusive licenses to produce, market, package, sell and distribute patent-protected therapeutic and pharmaceutical products throughout Europe, the United Kingdom, and North America.
Contact the author at jon.hopkins@proactiveinvestors.com