Material Event Form 8 K

Item 8.01 Other Events.

As previously disclosed, on January 29, 2024, Smart for Life, Inc. (the "Company") entered into an asset purchase agreement with First Health FL LLC (the "Buyer"), the Company's wholly owned subsidiary Ceautamed Worldwide, LLC and its wholly owned subsidiaries Wellness Watchers Global, LLC and Greens First Female LLC (together, the "Subsidiaries"), pursuant to which the Company sold all assets of the Subsidiaries to the Buyer (the "Disposition"), which upon consummation of the Disposition is 51% owned by certain affiliates of the Buyer and 49% owned by the Company, subject to a purchase option which may be exercised by the Buyer as described in the following paragraph.

In connection with the Disposition, the Company also entered into a limited liability company agreement, pursuant to which the Buyer was organized (the "LLC Agreement"). Pursuant to the LLC Agreement, the voting members of the Buyer are Joseph X. Xiras, Stuart Benson, and Ryan Benson (the "Voting Members"), each with a 17% voting interest in the Buyer. The Company will also maintain a 49% non-voting ownership interest in the Buyer (the "Minority Interest"). The Voting Members have the option to purchase the remaining Minority Interest for nominal consideration at their discretion upon notice to the Company exercisable at any time after April 1, 2024 (the "Option").

As previously disclosed, in connection with the closing of the Disposition, the Company, the Subsidiaries, First Group Acquisition Company, LLC ("First Group") and the Buyer also entered into an agreement to amend that certain 5% Secured Subordinated Promissory Note, dated as of July 29, 2022, by and between the Company and D&D Hayes, LLC, in the initial principal amount of $1,075,000 (as amended, the "Note"). Pursuant to the Note, the Company is entitled to discharge the Note for a cash payment to First Group in the amount of $300,000, plus interest of 10% per annum, in lieu of the prior outstanding principal balance on the Note. Since then, the Company and First Group have entered into subsequent transactions in respect of the Note and conversions of the Note into equity, resulting in a balance of $51,293.

On June 19, 2024, the parties entered into an agreement which implemented amendments to the original terms of the transactions described above. In particular, the Company and First Group agreed and established that that the outstanding amount of the Note was $351,293 and First Group elected to convert $300,000 in principal under the Note into 92,593 shares of common stock. Additionally, the parties agreed to extend the initial date upon which the which the Voting Members may exercise the Option to any time on or after October 1, 2024.