Charlotte’s Web (CWBHF) swaps C$89.6M BAT debenture for equity and adds US$10M
Filing Impact
Filing Sentiment
Form Type
8-K
Rhea-AI Filing Summary
Charlotte’s Web Holdings, Inc. completed a transformative transaction with British American Tobacco’s subsidiary BT DE Investments Inc. that converts debt to equity and adds new capital. A C$75.3 million convertible debenture plus C$14.2 million in accrued interest, totaling C$89.6 million, was fully converted into common shares at C$0.94 per share, issuing 95.3 million shares to BAT. BAT also invested an additional US$10 million (C$13.8 million) via a private placement for 14.7 million shares at the same price. In total, BAT will hold about 109.9 million shares, or 40.6% of 270.5 million common shares outstanding after closing. Shareholders strongly approved the debenture amendment and share issuance, and also set the board at six directors, re-elected all nominees, and appointed PKF O’Connor Davies LLP as auditor. BAT designee James Jeffery Raborn was appointed to the board, further formalizing the strategic relationship.
Positive
- Balance sheet de-risking and strategic capital: Conversion of C$89.6 million of BAT-held debenture and interest into equity plus a US$10 million private placement removes a sizable debt obligation, strengthens equity capital, and locks in a 40.6% strategic ownership stake from British American Tobacco.
Negative
- None.
Insights
Charlotte’s Web swaps debt for equity and deepens BAT partnership.
Charlotte’s Web converted C$89.6 million (US$65 million) of BAT-held convertible debenture and accrued interest into 95.3 million common shares at C$0.94, eliminating this debt and simplifying the balance sheet. BAT also provided US$10 million in new equity capital at the same price.
After issuing 109.9 million shares to BAT, total common shares are expected to be 270.5 million, giving BAT a 40.6% stake. This materially concentrates ownership and influence with a single strategic partner while reducing leverage and adding cash earmarked for medical channel initiatives, including the anticipated CMMI Medicare pilot program.
Shareholders backed the transaction strongly, with 48.5 million votes, or 94%, in favor of the resolution approving the debenture amendment and related share issuance. Future disclosures around TSX final approval and execution of the expanded medical strategy will further clarify the long-term impact.
8-K Event Classification
3 items: 5.02, 5.07, 8.01
3 items
Item 5.02
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers
Governance
Key personnel changes including departures, elections, or appointments of directors and executive officers.
Item 5.07
Submission of Matters to a Vote of Security Holders
Governance
Results of a shareholder vote on proposals at an annual or special meeting.
Item 8.01
Other Events
Other
Voluntary disclosure of events the company deems important to shareholders but not covered by other items.
Key Figures
Debenture principal: C$75,341,080
Accrued interest converted: C$14,223,321 (US$10.3 million)
Total debenture and interest converted: C$89,564,401 (US$65 million)
+5 more
8 metrics
Debenture principal
C$75,341,080
Original principal amount of BAT convertible debenture issued November 14, 2022
Accrued interest converted
C$14,223,321 (US$10.3 million)
Interest on BAT debenture converted to equity
Total debenture and interest converted
C$89,564,401 (US$65 million)
Aggregate amount converted into common shares at C$0.94
Shares issued on conversion
95,281,277 shares
Common shares issued to BAT in full settlement of debenture
Private placement size
US$10 million (C$13.8 million)
Gross proceeds from non-brokered private placement to BAT
Private placement shares
14,662,765 shares
Shares issued to BAT at C$0.94 Subscription Price
Post-closing BAT ownership
109,944,042 shares (40.6%)
Stake in 270,549,931 total common shares after closing
Votes for Transaction Resolution
48,498,268 votes (94%)
Shareholder approval to amend debenture and issue shares
Key Terms
convertible debenture, private placement, Toronto Stock Exchange, CMMI Medicare pilot program, +2 more
6 terms
convertible debenture financial
"the Company's C$75,341,080 principal amount convertible debenture held by BT DE Investments Inc."
A convertible debenture is a long-term loan a company issues that pays interest like a bond but can be turned into a set number of the company’s shares under pre-agreed terms. For investors it matters because it mixes safety and upside: you get regular interest and higher repayment priority like a lender, yet you also hold an option to become a shareholder if the stock rises, which can dilute existing owners and change risk and return profiles.
private placement financial
"a concurrent additional equity investment by BAT of US$10 million by way of a private placement"
A private placement is a way for companies to raise money by selling securities directly to a small group of investors instead of through a public offering. This process is often quicker and less regulated, making it similar to offering a special, exclusive investment opportunity to select individuals or institutions. For investors, it can provide access to unique investment options that are not available on public markets.
Toronto Stock Exchange regulatory
"Subject to satisfaction of customary closing conditions, including final approval of the Toronto Stock Exchange"
The Toronto Stock Exchange is Canada’s largest organized marketplace where shares of publicly traded companies are bought and sold, similar to a large, regulated marketplace for company ownership. It matters to investors because it provides transparent prices, rules that help protect buyers and sellers, and access to many Canadian and international businesses, so movements there can signal economic trends and affect portfolio values.
CMMI Medicare pilot program regulatory
"used to support the Company’s participation in the anticipated CMMI Medicare pilot program and other medical channel initiatives"
materially affect control regulatory
"where such Transaction would, (x) “materially affect control” ... through the creation of a new “Control Person”"
forward-looking statements regulatory
"Certain information provided herein constitutes forward-looking statements or information"
Forward-looking statements are predictions or plans that companies share about what they expect to happen in the future, like estimating sales or profits. They matter because they help investors understand a company's outlook, but since they are based on guesses and assumptions, they can sometimes be wrong.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________________________
FORM 8-K
___________________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
June 1, 2026 (May 28, 2026 )
Date of Report (date of earliest event reported)
___________________________________
(Exact name of registrant as specified in its charter)
___________________________________
(State or other jurisdiction of incorporation or organization) | (Commission File Number) | (I.R.S. Employer Identification Number) | ||||||
(Address of principal executive offices and zip code) | ||||||||
( | ||||||||
(Registrant's telephone number, including area code) | ||||||||
___________________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |||||
Securities registered pursuant to Section 12(b) of the Act: | ||||||||
Title of each class | Trading Symbol | Name of each exchange on which registered | ||||||
N/A | N/A | N/A | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 12b-2 of the Exchange Act.
Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 5.02 - Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Effective May 28, 2026 (the “Effective Date”), the board of directors of Charlotte’s Web Holdings, Inc. (the “Company”), appoint James Jeffery Raborn to the Company’s board of directors, until his successor shall have been duly elected and qualified or until his earlier resignation or removal. Mr. Raborn’s term will expire concurrently with the 2027 annual general meeting of the shareholders. Mr. Raborn was appointed as one of the designees to the board of directors by British American Tobacco ("BAT"), pursuant to the Investor Rights Agreement amendment between the Company and BT DE Investments Inc., a wholly-owned subsidiary of BAT, dated November 14, 2022, as amended and rested pursuant to the Amended and Restated Investor Rights Agreement, dated May 28, 2026. Mr. Raborn is not a party to any transaction with the Company reportable under Item 404(a) of Regulation S-K under the Securities Act of 1933, as amended.
Mr. Raborn has served since March of 2018 as the Executive Vice President of Law & External Affairs and General Counsel of Reynolds American, Inc., an American tobacco company that is a subsidiary of BAT. Mr. Raborn joined Reynolds American, Inc in 2004 and before assuming his current role, Mr. Raborn was Senior Vice President, Litigation and Regulatory, and Deputy General Counsel within the RAI Group. Mr. Raborn also previously served as the chairman of the Reynolds American Foundation.
Prior to joining Reynolds, Mr. Raborn practiced law in New Orleans and Baton Rouge and represented clients including Ford, Hyundai, Toyota, Kia, Black & Decker, Exxon, and Shell in product and premises liability cases. He also represented several companies including Exxon, Texaco, Shell, and Chevron before the Louisiana Public Service Commission. Mr. Raborn earned a bachelor’s degree in history and a juris doctorate degree from Louisiana State University.
Item 5.07 Submission of Matters to a Vote of Security Holders
At the annual general and special meeting of shareholders of the Company held virtually on May 28, 2026, the Company’s shareholders voted on the following proposals, each of which is described in detail in the Company’s definitive proxy statement filed with the Securities and Exchange Commission on April 16, 2026, and on SEDAR+ on April 16, 2026. The total number of votes cast at the annual general and special meeting was 96,513,512, representing 60.1% of the total number of votes attached to the outstanding voting shares of the Company.
Proposal No. 1: To set the number of directors of the Company at six.
The shareholders ratified the setting of the number of directors of the Company at six (6) directors.
Votes For | Votes Against | Abstain | ||||||||||||
95,340,748 | 1,172,764 | 0 | ||||||||||||
Proposal No. 2: To elect directors for the forthcoming year.
The shareholders voted to elect the following individuals as directors of the Company until the next annual meeting of shareholders at which election of directors is considered, or until his or her successor is duly elected or appointed:
Name of Director Nominee | Votes For | Votes Withheld | Abstain | Broker Non-Votes | ||||||||||||||||||||||
Matthew McCarthy | 49,512,385 | 0 | 2,034,163 | 44,966,964 | ||||||||||||||||||||||
Angela McElwee | 37,597,387 | 0 | 13,949,161 | 44,966,964 | ||||||||||||||||||||||
William Morachnick | 47,775,558 | 0 | 3,770,990 | 44,966,964 | ||||||||||||||||||||||
Jared Stanley | 46,776,458 | 0 | 4,770,090 | 44,966,964 | ||||||||||||||||||||||
Maureen Usifer | 49,462,870 | 0 | 2,083,678 | 44,966,964 | ||||||||||||||||||||||
M. Borgia Walker | 47,934,484 | 0 | 3,612,064 | 44,966,964 | ||||||||||||||||||||||
Proposal No. 3: To appoint PKF O’Connor Davies LLP as auditors for the ensuing fiscal year ending December 31, 2026 and the authorization of the board of directors to fix the remuneration to be paid to the auditors.
The shareholders ratified the appointment of PKF O’Connor Davies LLP as the Company’s auditors for the ensuing fiscal year ending December 31, 2026 and the authorization of the board of directors to fix the remuneration of the auditors.
Votes For | Votes Against | Abstain | ||||||||||||
90,245,431 | 0 | 6,268,081 | ||||||||||||
Proposal No. 4: To approve the ordinary resolution (the "Transaction Resolution") authorizing and approving the amendment (the "Amendment") of the Company's C$75,341,080 principal amount convertible debenture held by BT DE Investments Inc. (“BAT”), a wholly owned subsidiary of British American Tobacco p.l.c., issued on November 14, 2022 (the “Convertible Debenture”) and the issuance of common shares of the Company ("Common Shares") that may be required to be issued to BAT upon: (i) the conversion (the “Conversion”) of the Convertible Debenture; and (ii) the concurrent equity investment in the Company by BAT (the “Investment”, and together with the Amendment and the Conversion, the “Transaction”), where such Transaction would, (x) “materially affect control” (as such term is defined in the Toronto Stock Exchange Company Manual) of the Company through the creation of a new “Control Person” (as such term is defined in the Securities Act (British Columbia)); and (y) result in the issuance of greater than 25% of the number of Common Shares issued and outstanding prior to the closing of the Transaction.
The shareholders approved the Transaction Resolution authorizing and approving the Amendment of the Convertible Debenture and the issuance of Common Shares that may be required to be issued to BAT upon: (i) the Conversion of the Convertible Debenture; and (ii) the concurrent Investment in the Company by BAT, where such Transaction would, (x) “materially affect control” (as such term is defined in the Toronto Stock Exchange Company Manual) of the Company through the creation of a new “Control Person” (as such term is defined in the Securities Act (British Columbia)); and (y) result in the issuance of greater than 25% of the number of Common Shares issued and outstanding prior to the closing of the Transaction
Votes For | Votes Against | Abstain | Broker Non-Votes | |||||||||||||||||
48,498,268 | 3,048,280 | 0 | 44,966,964 | |||||||||||||||||
Item 8.01 Other Matters.
On May 28, 2026, the Company issued a press release announcing the voting results of its annual general and special meeting held on May 28, 2026. A copy of the press release is attached hereto and incorporated herein by reference as Exhibit 99.1.
Also on May 28, 2026, the Company issued a press release announcing the closing of the Transaction with BAT. A copy of the press release is attached hereto and incorporated herein by reference as Exhibit 99.2.
Exhibit No. | Description | |||||||
99.1 | Press Release dated May 28, 2026 announcing the Voting Results of the Annual and General Special Meeting. | |||||||
99.2 | Press Release dated May 28, 2026 relating to the closing of the Transaction with BT DE Investments Inc. | |||||||
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | |||||||
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized on this 1st day of June, 2026.
CHARLOTTE’S WEB HOLDINGS, INC. | |||||
By: | /s/ Mindy Garrison | ||||
Name: | Mindy Garrison | ||||
Title: | Chief Commercial Officer and Corporate Secretary | ||||
Date: June 1, 2026
News Release Exhibit 99.1
Charlotte's Web Reports Shareholder Meeting Voting Results
LOUISVILLE, CO. – May 28, 2026 - (TSX:CWEB) (OTCQX:CWBHF) Charlotte's Web Holdings, Inc. ("Charlotte's Web" or the "Company") is pleased to announce the results from its 2026 annual general and special meeting of shareholders held on May 28, 2026, via live audio webcast (the "Meeting"). Each of the matters voted upon at the Meeting is discussed in detail in the Company's Proxy Statement dated April 16, 2026, a copy of which is available on the Company's SEDAR profile at www.sedarplus.ca and on EDGAR at www.sec.gov.
“We appreciate the strong support from our shareholders demonstrated at today’s meeting,” said Bill Morachnick, Chief Executive Officer of Charlotte’s Web. “The approval of the BAT transaction marks an important milestone for the Company. Completion of the transaction will strengthen our balance sheet, simplify our capital structure, and position us with greater financial flexibility to execute our strategic priorities. We remain focused on driving long-term value through continued innovation in botanical wellness and expanding access to our products across key markets.”
The total number of votes cast at the Meeting was 96,513,512, representing 60.12% of the total number of votes attached to the outstanding voting shares of the Company. The results of the vote for the election of directors were as follows:
Nominee | # Votes For | % Votes For | # Votes Withheld | % Votes Withheld | ||||||||||
Matthew McCarthy | 49,512,385 | 96% | 2,034,163 | 4% | ||||||||||
Angela McElwee | 37,597,387 | 73% | 13,949,161 | 27% | ||||||||||
William Morachnick | 47,775,558 | 93% | 3,770,990 | 7% | ||||||||||
Jared Stanley | 46,776,458 | 91% | 4,770,090 | 9% | ||||||||||
Maureen Usifer | 49,462,870 | 96% | 2,083,678 | 4% | ||||||||||
M. Borgia Walker | 47,934,484 | 93% | 3,612,064 | 7% | ||||||||||
At the Meeting, an ordinary resolution was passed authorizing and approving the amendment (the “Amendment”) of the Company's C$75,341,080 principal amount convertible debenture held by BT DE Investments Inc. (“BAT”), a subsidiary of British American Tobacco p.l.c. (LSE: BATS and NYSE: BTI), issued on November 14, 2022 (the “Convertible Debenture”) and the issuance of common shares to BAT upon (i) the conversion (the “Conversion”) of the amended Convertible Debenture; and (ii) a concurrent equity investment in the Company by BAT (the “Investment”, and together with the Amendment and the Conversion, the “Transaction”). The ordinary resolution to approve the issuance of common shares upon completion of the Transaction was approved by 48,498,268 votes, or 94%, with 3,048,280 votes against, or 6%.
Subject to satisfaction of customary closing conditions, including final approval of the Toronto Stock Exchange (“TSX”), it is anticipated that the Transaction will close on or about May 28, 2026, and will result in the issuance of 109,944,042 common shares to BAT, representing 40.6% of the combined total number of 270,549,931 common shares issued and outstanding following closing of the Transaction. Detailed information on the Transaction is provided in the Proxy Statement dated April 16, 2026, a copy of which is available on the Company's SEDAR+ profile at www.sedarplus.ca and on EDGAR at www.sec.gov and the Company’s news release dated March 30, 2026.
Detailed results of all matters considered at the Meeting are reported in the Report of Voting Results as filed on the Company's SEDAR+ profile at www.sedarplus.ca.
About Charlotte’s Web Holdings, Inc.
Charlotte's Web Holdings, Inc., a Certified B Corporation headquartered in Louisville, Colorado, is a botanical wellness innovation company and a market leader in hemp extract wellness that includes Charlotte’s Web whole-plant full-spectrum CBD extracts as well as broad-spectrum CBD and cannabinoid isolates. The Company's hemp extracts have naturally occurring botanical compounds including cannabidiol ("CBD"), CBN, CBC, CBG, THC, terpenes, flavonoids, and other beneficial compounds. Charlotte’s Web product categories include CBD oil tinctures (liquid products), CBD gummies (sleep, calming, exercise recovery, immunity), CBN gummies, hemp-derived THC microdose gummies, functional mushroom gummies, CBD capsules, CBD topical creams, and lotions, as well as CBD pet products for dogs. Through its substantially vertically integrated business model, Charlotte’s Web maintains stringent control over product quality and consistency with analytic testing from soil to shelf for quality assurance. Charlotte’s Web products are distributed to retailers and healthcare practitioners throughout the U.S.A. and are available online through the Company's website at www.charlottesweb.com.
Shares of Charlotte's Web trade on the TSX under the symbol “CWEB” and are quoted in U.S. Dollars in the United States on the OTCQX under the symbol “CWBHF”. Subscribe to Charlotte's Web investor news.
For more information:
Cory Pala
Director of Investor Relations
(720) 484-8930
Cory.Pala@CharlottesWeb.com
No Offer or Solicitation
This press release shall not constitute a solicitation of a proxy, consent or authorization with respect to any securities or in respect of the Transaction. This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which the offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.
Forward-Looking Information
Certain information provided herein constitutes forward-looking statements or information (collectively, "forward-looking statements") within the meaning of applicable securities laws. Forward-looking statements are typically identified by words such as "may," "will," "should," "could," "anticipate," "expect," "project," "estimate," "forecast," "plan," "intend," "target," "believe" and similar words suggesting future outcomes or statements regarding an outlook. Forward-looking statements are not guarantees of future performance and readers are cautioned against placing undue reliance on forward-looking statements. Specifically, this press release contains forward-looking statements relating to, but not limited to: the completion of the Transaction with BAT, including obtaining the necessary TSX approval; anticipated impact of the Transaction on the Company’s financial position and operations; and the Company’s strategic focus going forward.
By their nature, these statements involve a variety of assumptions, known and unknown risks and uncertainties, and other factors which may cause actual results, levels of activity, and achievements to differ materially from those expressed or implied by such statements. The forward-looking statements contained in this press release are based on certain assumptions and analysis by management of the Company in light of its experience and perception of historical trends, current conditions and expected future developments and other factors that management believes are appropriate and reasonable. The material factors and assumptions used to develop the forward-looking statements herein include, but are not limited to: the receipt of TSX approval and the satisfaction of all other conditions to completion of the Transaction; the anticipated timing of the Transaction closing; anticipated cost reductions and their impact on the Company's improving cash flow outlook; availability of adequate liquidity and capital to support operations and business plans. In addition, the forward-looking statements are subject to risks and uncertainties pertaining to, among other things: the risk that the Transaction does not receive required regulatory approvals or that closing conditions are not satisfied; supply and distribution chains; the market for the Company's products; revenue fluctuations; regulatory changes; loss of customers and retail partners; retention and availability of talent; competing products; share price volatility; loss of proprietary information; product acceptance; internet and system infrastructure functionality; information technology security; available capital to fund operations and business plans; crop risk; economic and political considerations; and including but not limited to those risks and uncertainties discussed under the heading "Risk Factors" in the Company's Annual Report on Form 10-K for the year ending December 31, 2025, and other risk factors contained in other filings with the Securities and Exchange Commission available at http://www.sec.gov and filings with Canadian securities regulatory authorities available at www.sedarplus.ca. The impact of any one risk, uncertainty, or factor on a particular forward-looking statement is not determinable with certainty as these are interdependent, and the Company's future course of action depends on management's assessment of all information available at the relevant time.
Any forward-looking statement in this press release is based only on information currently available to the Company and speaks only as of the date on which it is made. Except as required by applicable law, the Company assumes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events, or otherwise. All forward-looking statements, whether written or oral, attributable to the Company or persons acting on the Company's behalf, are expressly qualified in their entirety by these cautionary statements.
News Release Exhibit 99.2
Charlotte’s Web Announces Closing of Transaction with British American Tobacco, including US$10 Million Investment
LOUISVILLE, CO. – May 28, 2026 - (TSX:CWEB) (OTCQX:CWBHF) Charlotte's Web Holdings, Inc. ("Charlotte's Web" or the "Company") is pleased to announce that, further to its press release dated March 30, 2026, Charlotte’s Web has closed the transaction with BT DE Investments Inc. (“BAT”), a subsidiary of British American Tobacco p.l.c. (LSE: BATS and NYSE: BTI), comprised of two components: (i) the amendment and conversion of BAT’s outstanding C$75.3 million (or approximately US$55 million) as of May 28, 2026 principal amount of the convertible debenture, as well as all accrued interest thereon, into common shares of Charlotte’s Web at a conversion price of C$0.94 per share; and (ii) a concurrent additional equity investment by BAT of US$10 million by way of a private placement at a per share price (the “Subscription Price”) of C$0.94 (collectively, the “Transaction”). The Transaction is subject to final approval from the Toronto Stock Exchange (the “TSX”).
“This transaction meaningfully strengthens our balance sheet and enhances our capital position,” said Bill Morachnick, Chief Executive Officer of Charlotte’s Web. “With increased financial flexibility and a streamlined capital structure, we are better positioned to execute our growth strategy, expand access, and deliver long-term value for our shareholders. We are grateful to British American Tobacco for their continued investment.”
Transaction Overview
Amendment and Conversion of Outstanding Debenture
The convertible debenture issued by Charlotte’s Web to BAT on November 14, 2022, in the original principal amount of C$75,341,080 (US$54.7 million), was amended and converted in full into common shares of Charlotte’s Web at a conversion price of C$0.94 per share. The converted amount includes the full principal amount of C$75,341,080 together with C$14,223,321 (US$10.3 million) in accrued interest, for a total converted amount of C$89,564,401 (US$65 million), resulting in the issuance of 95,281,277 common shares to BAT in full and final settlement of the convertible debenture.
US$10 Million Concurrent Private Placement
Concurrently with the debenture conversion, BAT subscribed for an additional non-brokered private placement of 14,662,765 common shares of Charlotte’s Web at the Subscription Price, for gross proceeds of US$10 million (C$13.8 million). The net proceeds of the cash will be used to support the Company’s participation in the anticipated CMMI Medicare pilot program and other medical channel initiatives. The program creates a pathway for eligible Medicare beneficiaries to access CBD products through consultation with their physician, subject to program requirements and regulatory approvals.
The Company is a corporation existing under the laws of the province of British Columbia with its head office located at 700 Tech Court, Louisville, Colorado 80027, USA. BAT is a corporation existing under the laws of the
state of Delaware with its head office located at 401 North Main Street, Winston-Salem, North Carolina 27010, USA.
No Offer or Solicitation
This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which the offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction.
About Charlotte’s Web Holdings, Inc.
Charlotte's Web Holdings, Inc., a Certified B Corporation headquartered in Louisville, Colorado, is a botanical wellness innovation company and a market leader in hemp extract wellness that includes Charlotte’s Web whole-plant full-spectrum CBD extracts as well as broad-spectrum CBD and cannabinoid isolates. The Company's hemp extracts have naturally occurring botanical compounds including cannabidiol ("CBD"), CBN, CBC, CBG, THC, terpenes, flavonoids, and other beneficial compounds. Charlotte’s Web product categories include CBD oil tinctures (liquid products), CBD gummies (sleep, calming, exercise recovery, immunity), CBN gummies, hemp-derived THC microdose gummies, functional mushroom gummies, CBD capsules, CBD topical creams, and lotions, as well as CBD pet products for dogs. Through its substantially vertically integrated business model, Charlotte’s Web maintains stringent control over product quality and consistency with analytic testing from soil to shelf for quality assurance. Charlotte’s Web products are distributed to retailers and healthcare practitioners throughout the U.S.A. and are available online through the Company's website at www.charlottesweb.com.
Shares of Charlotte's Web trade on the Toronto Stock Exchange (TSX) under the symbol “CWEB” and are quoted in U.S. Dollars in the United States on the OTCQX under the symbol “CWBHF”. Subscribe to Charlotte's Web investor news.
For more information:
Cory Pala
Director of Investor Relations
(720) 484-8930
Cory.Pala@CharlottesWeb.com
Forward-Looking Information
Certain information provided herein constitutes forward-looking statements or information (collectively, “forward-looking statements”) within the meaning of applicable securities laws. Forward-looking statements are typically identified by words such as “may,” “will,” “should,” “could,” “anticipate,” “expect,” “project,” “estimate,” “forecast,” “plan,” “intend,” “target,” “believe” and similar words suggesting future outcomes or statements regarding an outlook. Forward-looking statements are not guarantees of future performance and readers are cautioned against placing undue reliance on forward-looking statements. Specifically, this press release contains forward-looking statements relating to, but not limited to: obtaining the necessary TSX approval of the Transaction; benefits to the Company of completing the Transaction with BAT; use of proceeds of the Transaction; the Company’s participation in the CMMI pilot program; and financial impacts to the Company of completing the Transaction.
By their nature, these statements involve a variety of assumptions, known and unknown risks and uncertainties, and other factors which may cause actual results, levels of activity, and achievements to differ materially from those expressed or implied by such statements. The forward-looking statements contained in this press release are based on certain assumptions and analysis by management of the Company in light of its experience and perception of historical trends, current conditions and expected future developments and other factors that management believes are appropriate and reasonable. The material factors and assumptions used to develop the forward-looking statements herein include, but are not limited to: the receipt of TSX approval and the satisfaction of all other conditions to completion of the Transaction; the anticipated impact of the debenture conversion and private placement on the Company’s balance sheet, shareholders’ equity, and financial position; the intended use of private placement proceeds; expectations around hemp wellness distribution through the CMMI Medicare pilot program; the progress and potential outcomes of DeFloria’s Phase 2 clinical trials for AJA001; anticipated
cost reductions and their impact on the Company’s improving cash flow outlook; regulatory regime changes and federal hemp policy developments; anticipated product development and sales; the success of sales and marketing activities; availability of adequate liquidity and capital to support operations and business plans; and expectations around consumer product demand. In addition, the forward-looking statements are subject to risks and uncertainties pertaining to, among other things: the risk that the Transaction does not receive required regulatory approvals or that closing conditions are not satisfied; supply and distribution chains; the market for the Company’s products; revenue fluctuations; regulatory changes; loss of customers and retail partners; retention and availability of talent; competing products; share price volatility; loss of proprietary information; product acceptance; internet and system infrastructure functionality; information technology security; available capital to fund operations and business plans; crop risk; economic and political considerations; and including but not limited to those risks and uncertainties discussed under the heading “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ending December 31, 2024, and other risk factors contained in other filings with the Securities and Exchange Commission available at http://www.sec.gov and filings with Canadian securities regulatory authorities available at www.sedarplus.ca. The impact of any one risk, uncertainty, or factor on a particular forward-looking statement is not determinable with certainty as these are interdependent, and the Company’s future course of action depends on management’s assessment of all information available at the relevant time.
Any forward-looking statement in this press release is based only on information currently available to the Company and speaks only as of the date on which it is made. Except as required by applicable law, the Company assumes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events, or otherwise. All forward-looking statements, whether written or oral, attributable to the Company or persons acting on the Company’s behalf, are expressly qualified in their entirety by these cautionary statements.
FAQ
What major transaction did Charlotte’s Web (CWBHF) complete with British American Tobacco?
Charlotte’s Web completed a two-part transaction with BAT’s subsidiary. It fully converted a C$75.3 million debenture plus C$14.2 million interest into shares at C$0.94 and raised an additional US$10 million through a private placement, both subject to final TSX approval.
What new capital did Charlotte’s Web (CWBHF) receive from British American Tobacco?
Beyond the debt conversion, BAT provided US$10 million of new equity capital. This came through a non-brokered private placement of 14,662,765 common shares at C$0.94 per share, with net proceeds earmarked for CMMI Medicare pilot participation and other medical channel initiatives.
What governance changes accompanied the Charlotte’s Web and BAT transaction?
The board appointed James Jeffery Raborn, a British American Tobacco designee, as a director. Shareholders also set the board size at six and re-elected all nominated directors, reinforcing existing leadership while formally adding BAT’s board representation through the investor rights arrangements.