On October 3, 2022 ChromaDex Corp. (NASDAQ:CDXC) (the "Company"), a global bioscience company dedicated to healthy aging, reported that it has established a joint venture through its wholly owned subsidiary ChromaDex Asia Pacific Ventures Limited (the "JV" or "ChromaDex Asia") (Press release, ChromaDex, OCT 3, 2022, View Source [SID1234621633]). The JV collectively consists of the Company and Hong Kong Taikuk (China) Group Limited. The purpose of the JV will be to commercialize Tru Niagen and other products containing Niagen in China. ChromaDex Asia will enter into a new distribution agreement with Sinopharm Xingsha ("Sinopharm") upon successfully attaining health food registration for Tru Niagen with the People’s Republic of China and will assume the cross border distribution agreement noted in a previous press release with Sinopharm at that time. Both agreements relate to the commercialization of Tru Niagen in mainland China and its territories, excluding Hong Kong, Macau and Taiwan (the "Territory").
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The Company also announced that it entered into a securities purchase agreement for the sale of $3.1 million of its common stock in a private placement. The private placement was led by existing strategic investors, and included an investment by ChromaDex CEO, Rob Fried. The private placement is expected to close on or about October 7, 2022, subject to the satisfaction of customary closing conditions. In connection with the investment, the Company agreed to sell 2,480,000shares of its common stock at a per share price of $1.25, for gross proceeds of approximately $3.1 million.
The net proceeds are expected to be invested in international expansion, including securing health food registration for Tru Niagen in mainland China, and to support general corporate purposes.
"This joint venture will help ChromaDex manage the sales and regulatory approval efforts of Tru Niagen in China where consumers already have an excellent understanding of the benefits of NAD+ for healthy aging," said Rob Fried, CEO of ChromaDex. "The investment in ChromaDex by our trusted long-term shareholders will be used to help support this effort. With several strong partnerships now firmly established in Asia, we are well positioned to realize the Tru Niagen potential."
"We are very excited about this opportunity to partner with ChromaDex and bring Tru Niagen into the China market," said Tianyi Zheng, Chairman of Hong Kong Taikuk (China) Group Limited. "We truly believe in the science behind the product and look forward to having more customers in the country to benefit from Tru Niagen."
For detailed transaction terms, see our Current Report on Form 8-K filed on October 3, 2022 concurrently with this release.
The shares of common stock being sold in the private placement will not have been registered under the Securities Act of 1933, as amended (the "Act"). Accordingly, such shares may not be offered or sold in the United States except pursuant to an effective registration statement or an applicable exemption from the registration requirements under the Act. In connection with the private placement, ChromaDex has entered into a registration rights agreement with the investors. This press release does not constitute an offer to sell or the solicitation of an offer to buy the securities, nor shall there be any sale of the securities in any state in which such offer or sale would be unlawful prior to the registration or qualification under the securities laws of such state. Any offering of the securities under the resale registration statement will only be by means of a prospectus.
Important Note on Forward Looking Statements:
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, without limitation, statements with respect to the formation of the JV and the commercialization of Tru Niagen and other products containing Niagen in the Territory, health food (Blue Hat) registration, the entry into the agreements contemplated by the JV, including the distribution agreement and the cross-border agreement, and the closing of the financing transaction. These forward-looking statements are based upon the Company’s current expectations and inherently involve significant risks and uncertainties. Actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of these risks and uncertainties, which include, without limitation, risks and uncertainties associated with the satisfaction of customary closing conditions related to the agreements, obtaining the health food (Blue Hat) registration, completing the financing transaction and successfully commercializing Tru Niagen and other products containing Niagen in the Territory. Additional risks and uncertainties relating to the Company and its business can be found under the caption "Risk Factors" in the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2022, as filed with the Securities and Exchange Commission and other filings submitted by the Company. Forward-looking statements speak only as of the date of this press release, and the Company undertakes no duty or obligation to update any forward-looking statements contained in this press release as a result of new information, future events, or changes in its expectations after the date of this press release.
About Tru Niagen :
Tru Niagen is a branded dietary supplement brought to market by key nicotinamide riboside innovator and patent holder, ChromaDex. Niagen nicotinamide riboside (NR), also supplied by ChromaDex, is the sole active ingredient in Tru Niagen. Multiple clinical trials demonstrate Niagen is proven to boost NAD+ (nicotinamide adenine dinucleotide) levels, which decline with age. Only NIAGEN has twice been successfully reviewed under FDA’s new dietary ingredient ("NDI") notification program and has also been successfully notified to the FDA as generally recognized as safe ("GRAS").