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Vital Living Completes Divestiture of Assets of Christopher's Original Formulas

PHOENIX, Aug 4, 2004 (BUSINESS WIRE) -- Vital Living Inc. (VTLV) today announced that it has entered into an agreement to divest itself of the assets of Christopher's Original Formulas (COF). Christopher's Original Formulas markets an extensive line of non-proprietary, traditional vitamins to consumers primarily through independent health food stores.

The terms of the divestiture provide for the assets of COF to be returned to its original owners, who have agreed to assume certain outstanding liabilities and return the 2 million shares of Vital Living's common stock previously issued to them. The transaction also provides for Vital Living to pay expenses associated with the divestiture totaling $150,000, payable in six equal monthly payments of $25,000, beginning immediately. The former monthly operating loss at COF was well in excess of the agreed upon monthly payments. Consequently, Vital Living's negative cash flow should be substantially reduced.

Stuart A. Benson, chief executive officer of Vital Living, stated, "Thanks to a tremendous amount of hard work and team support, we've reached this major turning point in the company's evolution. With a vision to emerge as a very unique, highly differentiated health, pharmaceutical delivery systems and nutraceutical company, we need to take very decisive steps in order to successfully execute a business model that is profit-minded, objective-oriented and milestone-driven, while also concentrating effort on reducing overhead and negative cash flow. As a result, we have elected to divest ourselves of the assets of Christopher's Original Formulas from our operations at this time." Concluding, Benson added, "We believe this decision will allow us to regain our focus on supporting and promoting innovative and high-quality, proprietary products."

"Since it is our intention to focus strictly on marketing only products that are branded and proprietary to Vital Living, selling COF's traditional vitamin/herbal products no longer fit our business model," said Mitchel Feinglas, Vital Living's chief operating officer. "Moreover, by completing this transaction, Vital Living relieves itself of a business not producing positive cash flow."

About Vital Living Inc.

Headquartered in Phoenix, Vital Living develops or licenses nutraceuticals and markets them for distribution through physicians, medical groups, chiropractic offices and retail outlets. Vital Living develops and tests its nutraceuticals in collaboration with leading medical experts in the nutraceuticals field and has designed them to be incorporated by physicians into a standard physician-patient program in which patients supplement doctor-prescribed pharmaceuticals with its nutraceuticals.

Vital Living is developing unique, safe and naturally derived nutritional products, utilizing advanced drug-delivery technologies, including the Geomatrix(R) technology through its affiliation with SkyePharma PLC. The Geomatrix(R) technology has been provided exclusively for Vital Living's pharmaceutical development in China, and the development of nutraceuticals. The company's initial areas of focus are cardiovascular health, through its product Essentum(R) which is currently undergoing clinical trials and being endorsed by the Arizona Heart Institute and prescribed throughout the United States; and weight loss, through its licensed product X-Fat(R), the company's patented dietary supplement that uses Kytabsorbe, a liquid form of the natural fat absorber, Chitosan. Vital Living owns and operates four wholly owned subsidiaries: E-Nutriceuticals, MAF BioNutritionals, Nature's Systems and Doctors for Nutrition. For more information on the company, please visit

Except for any historical information, the matters discussed in this press release contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements involve risks and uncertainties, including activities, events or developments that the company expects, believes or anticipates will or may occur in the future. A number of factors could cause actual results to differ from those indicated in the forward-looking statements, including the company's ability to continue to successfully market and provide its products and services and maintain their effectiveness, the continuation of the arrangements with the company's product development partners, the ability of the company to meet its financial projections, and general economic conditions. Such statements are subject to a number of assumptions, risks and uncertainties. Readers are cautioned that such statements are not guarantees of future performance and that actual results or developments may differ materially from those set forth in the forward-looking statements. The company undertakes no obligation to publicly update or revise forward-looking statements, whether as a result of new information or otherwise.

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