ASSET PURCHASE AGREEMENT	12 Months Ended
Sep. 30, 2019
ASSET PURCHASE AGREEMENT
ASSET PURCHASE AGREEMENT	NOTE D – ASSET PURCHASE AGREEMENT During August 2019, LRx entered into an Asset Purchase Agreement (the “Vitatex Agreement”) with Vitatex, Inc. (“Vitatex”), providing for the purchase of substantially all of the assets of Vitatex (“Vitatex Assets”). The Vitatex assets relate to the business of an early stage private biotechnology company focused on advancing personalized medicine with a potential solution that isolates Invasive Circulating Tumor Cells (“iCTCs”) from standard patient blood samples. The acquisition of the Vitatex Assets was completed in August 2019. The Vitatex Assets include physical assets, such as laboratory equipment, as well as registered trademarks and other intellectual property. The Vitatex Assets also include Vitatex’s rights under an exclusive patent license agreement between The Research Foundation for the State University of New York (the “Research Foundation”) and Vitatex. The Company did not assume any liabilities of Vitatex. In connection with the acquisition of the Vitatex Assets, the Company entered into the Amended and Restated Exclusive License Agreement with the Research Foundation and Vitatex on August 7, 2019, pursuant to which the Company assumed the rights to a global patent portfolio covering the iCTC technology. The purchase price for the Vitatex Assets consisted of $500,000 in cash and common stock of LRx and up to an additional $500,000 of LRx common stock as performance-based contingent consideration. Of this amount, (i) an initial payment comprised of $300,000 in shares of common stock of LRx made to the shareholders of Vitatex, (ii) $100,000 in cash must be paid to Vitatex on or before September 30, 2019, subject to adjustment as provided below, and (iii) $100,000 in cash must be paid to Vitatex on or before December 31, 2019. The purchase price was reduced by an amount equal to any payment required to be made by LRx to pay off and satisfy Vitatex’s outstanding cash and/or equity obligations owed to the Research Foundation under the License Agreement as delineated in the Restated License Agreement. Pursuant to the Restated License Agreement, LRx paid $11,710 in cash to the Research Foundation, thereby reducing the cash payment due to Vitatex before September 30, 2019 to $88,290. In addition, the shareholders of Vitatex are also entitled to additional performance-based equity distributions of up to $500,000 in shares of common stock of LRx with (i) $250,000 of LRx common stock that was paid upon the occurrence of LRx completing certain National Cancer Institute Small Business Innovation Research program filings, (ii) $100,000 of LRx common stock that will become due if the Vitatex Assets yield more than $100,000 in gross revenue by July 29, 2020 and (iii) $150,000 of LRx common stock that will become due if the Vitatex Assets yield an additional $200,000 in gross revenue. The Research Foundation will receive cash instead of shares of LRx upon the completion of any such performance-based events. As part of this transaction, the Company issued 2% of LRx’s common stock, valued at $113,132. This transaction was accounted for as an asset acquisition in accordance with ASC 805. The Company concluded that since the assets acquired were considered in process research and development assets, the value of $345,332 that was assigned to the “know-how” was expensed to research and development expenses in the consolidated statement of operations for the fiscal year ended September 30, 2019. For the remaining contingent consideration, the Company has determined that it is not probable that the milestones will be met and therefore, no liability is recorded as of September 30, 2019.

NOTE D – ASSET PURCHASE AGREEMENT

During August 2019, LRx entered into an Asset Purchase Agreement (the “Vitatex Agreement”) with Vitatex, Inc. (“Vitatex”), providing for the purchase of substantially all of the assets of Vitatex (“Vitatex Assets”). The Vitatex assets relate to the business of an early stage private biotechnology company focused on advancing personalized medicine with a potential solution that isolates Invasive Circulating Tumor Cells (“iCTCs”) from standard patient blood samples. The acquisition of the Vitatex Assets was completed in August 2019. The Vitatex Assets include physical assets, such as laboratory equipment, as well as registered trademarks and other intellectual property. The Vitatex Assets also include Vitatex’s rights under an exclusive patent license agreement between The Research Foundation for the State University of New York (the “Research Foundation”) and Vitatex. The Company did not assume any liabilities of Vitatex. In connection with the acquisition of the Vitatex Assets, the Company entered into the Amended and Restated Exclusive License Agreement with the Research Foundation and Vitatex on August 7, 2019, pursuant to which the Company assumed the rights to a global patent portfolio covering the iCTC technology.

The purchase price for the Vitatex Assets consisted of $500,000 in cash and common stock of LRx and up to an additional $500,000 of LRx common stock as performance-based contingent consideration. Of this amount, (i) an initial payment comprised of $300,000 in shares of common stock of LRx made to the shareholders of Vitatex, (ii) $100,000 in cash must be paid to Vitatex on or before September 30, 2019, subject to adjustment as provided below, and (iii) $100,000 in cash must be paid to Vitatex on or before December 31, 2019. The purchase price was reduced by an amount equal to any payment required to be made by LRx to pay off and satisfy Vitatex’s outstanding cash and/or equity obligations owed to the Research Foundation under the License Agreement as delineated in the Restated License Agreement. Pursuant to the Restated License Agreement, LRx paid $11,710 in cash to the Research Foundation, thereby reducing the cash payment due to Vitatex before September 30, 2019 to $88,290. In addition, the shareholders of Vitatex are also entitled to additional performance-based equity distributions of up to $500,000 in shares of common stock of LRx with (i) $250,000 of LRx common stock that was paid upon the occurrence of LRx completing certain National Cancer Institute Small Business Innovation Research program filings, (ii) $100,000 of LRx common stock that will become due if the Vitatex Assets yield more than $100,000 in gross revenue by July 29, 2020 and (iii) $150,000 of LRx common stock that will become due if the Vitatex Assets yield an additional $200,000 in gross revenue. The Research Foundation will receive cash instead of shares of LRx upon the completion of any such performance-based events. As part of this transaction, the Company issued 2% of LRx’s common stock, valued at $113,132.

This transaction was accounted for as an asset acquisition in accordance with ASC 805. The Company concluded that since the assets acquired were considered in process research and development assets, the value of $345,332 that was assigned to the “know-how” was expensed to research and development expenses in the consolidated statement of operations for the fiscal year ended September 30, 2019. For the remaining contingent consideration, the Company has determined that it is not probable that the milestones will be met and therefore, no liability is recorded as of September 30, 2019.