LM Funding America signed a letter of intent to acquire all of the outstanding shares of insurance broker IIU Inc. from Craven House Capital PLC for about $6 million.

The acquisition is expected to be completed Jan. 1, 2019.

The consideration will be satisfied through the cancellation of IIU's $1.5 million promissory note held by LM Funding and the issuance of the acquirer's convertible promissory note to Craven House.

The convertible promissory note will bear an annual interest rate of 3% and is payable in cash or in LM Funding common stock, at a conversion price of $2.41 per share. It will mature on Aug. 31, 2019, or 30 days after the first meeting of LM Funding America's shareholders, whichever is earlier.