Guardion Health Sciences Announces Financial Results for the Year Ended December 31, 2023 - Seite 2

Recent Developments in 2024

Agreement to Sell Activ Nutritional, LLC

On January 30, 2024, the Company entered into an Equity Purchase Agreement (the “Purchase Agreement”) with Doctor’s Best Inc., a Delaware corporation, for the sale of all of the outstanding equity interests of Activ Nutritional, LLC (“Activ”) for aggregate cash consideration of $17.2 million, of which $1.7 million was placed in a third-party escrow account pursuant to the terms of the Purchase Agreement. Doctor’s Best Inc. is a wholly-owned subsidiary of Kingdomway USA Corp., the U.S. subsidiary holding company of Xiamen Kingdomway Group Company (“XKDW”), which is publicly listed on the Shenzhen Stock Exchange.

The sale of Activ, as contemplated by the Purchase Agreement, is conditioned upon receiving approval from the Company’s stockholders as the sale of Activ, which owns the Viactiv brand and business and accounted for 97.2% and 96.3% of revenues during the years ended December 31, 2023 and 2022, respectively, constitutes a sale of substantially all of the Company’s assets and revenue-generating operations. The transaction contemplated by the Purchase Agreement is the result of a broad review of strategic alternatives by the Company’s Board of Directors. The Board of Directors has determined that it is advisable and in the best interests of the Company and the Company’s stockholders to approve this transaction.

Potential Dissolution

In the event that the Company’s stockholders approve the transaction and the transaction closes, the Company would be left with minimal operations. The Board of Directors has additionally determined that it is advisable and in the best interests of the Company and its stockholders to approve a voluntary dissolution and liquidation of the Company pursuant to a Plan of Liquidation and Dissolution, which, if approved, would authorize the Company to liquidate and dissolve in accordance with its terms, but such decision would be subject to the Company’s ability to abandon or delay the Plan of Liquidation and Dissolution in the event that the Board of Directors determines that another transaction would be in the best interests of the Company’s stockholders. Assuming the approval of the Plan of Liquidation and Dissolution by the Company’s stockholders, the decision as to whether or not to proceed with the dissolution and when to file the Certificate of Dissolution will be made by the Board of Directors in its sole discretion.