Form 8-K - Current report

 

 

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

Date of Report (Date of earliest event reported): June 17, 2024

 

Charlotte’s Web Holdings, Inc.

(Exact name of Registrant as Specified in Its Charter)

 

 

British Columbia	000-56364	98-1508633
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

 

700 Tech Court Louisville, Colorado	80027
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s Telephone Number, Including Area Code: [phone]

 

Not applicable

(Former Name or Former Address, if Changed Since Last Report)

 

 

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 (see General Instructions A.2. below):

 

☐	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 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 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

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.

 

 On June 18, 2024, Charlotte’s Web Holdings, Inc. (the “Company”) announced the appointment of Erika Lind, age 52, as the Company’s Chief Financial Officer effective June 29, 2024. Ms. Lind will replace the Company’s Chief Financial Officer, Jessica Saxton, who provided notice to the Company on June 17, 2024, that she will depart the Company effective June 28, 2024. Mrs. Saxton’s departure is not based on any disagreement with the Company’s accounting principles, practices, or financial statement disclosures.

Ms. Lind has been with the Company since March, 2023 as Vice President of Financial Planning and Analysis, and Treasury, where she has led strategic financial planning, performance management, and treasury operations. Prior to joining the Company, Ms. Lind was Vice President of Finance at Made In Nature LLC from May, 2021 through March, 2023, and was Corporate Controller, Spectra Logic Corp. from February, 2019 through May, 2021. Ms. Lind received her B.S. from Metropolitan State University of Denver and her MBA from Regis University, Denver.

Pursuant to the terms of her offer letter, Ms. Lind’s base salary will be $280,000 per annum and will be subject to applicable withholding taxes.  Ms. Lind’s target bonus opportunity under the Company’s short term incentive plan has been set at 75% of her actual, regular earnings, subject to the Company’s discretion and the Company’s achievement of certain business targets/initiatives and individual performance. The Company’s Compensation Committee has the right to adjust or amend the short-term incentive plan at its sole discretion. Ms. Lind is also eligible to participate in the Company’s long-term incentive program and to receive equity award grants in a manner consistent with the Company’s practices for senior management. The Compensation Committee has the right to adjust or amend eligibility and the long-term incentive plan at their sole discretion. Ms. Lind also is entitled to participate in the Company’s benefit programs applicable generally to employees and executive officers. Such compensation and benefit plans and arrangements are described in the Company’s proxy statement on Schedule 14A filed with the U.S. Securities and Exchange Commission on April 29, 2024, relating to its 2024 annual general meeting.

Item 7.01

Regulation FD Disclosure.

 

 On June 18, 2024, the Company issued a press release announcing the appointment of Ms. Lind as Chief Financial Officer, effective June 29, 2024, and the departure of Ms. Saxton as the Company’s Chief Financial Officer, effective June 28, 2024. A copy of the press release is filed as Exhibit 99.1 and incorporated into this Item 7.01 by reference.

 

The information in this Item 7.01 of this Form 8-K is furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such filing.

 

(d)

Exhibits:

 

Exhibit No.		Description
10.1†		Offer Letter from Charlotte’s Web Holdings, Inc. to Erika Lind, dated June 17, 2024.
99.1*		Press release issued by Charlotte’s Web Holdings, Inc. on June 18, 2024.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document

 

 

 

† Indicates a management contract or compensatory plan or arrangement.

 

* This Exhibit 99.1 is furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such filing.

 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

		CHARLOTTE’S WEB HOLDINGS, INC.
Date: June 20, 2024		By:	/s/ Stephen Rogers
			Stephen Rogers
			Senior Vice President - General Counsel and Corporate Secretary

 

Exhibit 10.1

 

 

 

June 17, 2024

 

Erika Lind

 

Dear Erika,

 

Charlotte’s Web, Inc. (“Company”) is pleased to extend to you this promotion to work in the full-time position of Chief Financial Officer .

This position is exempt and reports directly to William Morachnick, Chief Executive Officer. Your anticipated start date is 28 Jun 2024.

 

Compensation and Benefits

Base Compensation: Should you decide to accept this offer, your compensation will be $10,769.23 paid on a biweekly basis equating to approximately USD $280,000.00 per year. Your salary may be adjusted from time to time at the Company’s sole discretion.

This position is an exempt position, which means you are paid for the job and not by the hour. Accordingly, you will not receive overtime pay. Your salary is intended to compensate you for the quality of your work. Your work hours may vary from week to week depending on the Company’s needs.

Short-Term Incentive Plan: Your target bonus threshold opportunity will be 75% of your actual, regular earnings during the Plan Year. Actual payments or grants will be made at the Company’s discretion based on the Company’s Performance Metrics. Any annual incentive payment or grant will generally be paid within the first quarter following the end of the Plan Year. Regular Earnings is defined as the aggregate base salary earned during the period. The Compensation Committee reserves the right to adjust or amend the short-term incentive plan at their sole discretion.

Long-Term Incentive Program: The company intends to make annual grant awards equal to 1.5% of the Company’s common shares outstanding, allocated based on salaries of the participant pool consisting of active employees at or above the Director level. Annual grants are typically made during the first quarter of the fiscal year, after the Compensation Committee’s approval of the LTI share pool. Eligible participants must be actively employed on or before the approval date. The Compensation Committee reserves the right to adjust or amend eligibility and the long-term incentive plan at their sole discretion.

 

Guidelines for Employment

If you accept this offer and become an employee of the Company, you will be subject to our employment policies. In addition, the Company reserves the right to modify the compensation or benefits arrangements described in this letter or otherwise maintained by the Company, and also reserves the right to modify your position or duties to meet business needs and to use its discretion in deciding on appropriate discipline. Upon hire, you will be required to read and sign an acknowledgment of receipt of the Employee Handbook and any applicable state supplement.

This letter is not intended to be and does not constitute a contract of employment and shall not be construed or interpreted so as to create any contractual right to employment or continued employment. Employment at Charlotte’s Web is an “at will” employment relationship meaning that either party shall have the right to terminate the employment agreement at any time, for any reason or for no reason.

 

 

 

 This letter, including the enclosed CIIAA, constitutes the entire agreement between you and the Company relating to this subject matter and supersedes all prior or contemporaneous agreements, understandings, negotiations or representations, whether oral or written, express or implied, on this subject. Except as provided herein, this letter may not be modified or amended except by the Company’s Chairman of the Board or Chairman of the Board’s authorized representative.

 

Restrictions on Employment

By signing this offer letter, you represent and warrant that you are not party to any agreement or subject to any policy applicable to you that would prevent or restrict you from engaging in activities competitive with the activities of your former employer or from directly or indirectly soliciting any employee, client or customer to leave the employ of, or transfer its business away from, your former employer, or if you are subject to such an agreement or policy, you have complied and will comply with it, and your employment with the Company does not violate any such agreement or policy. You further confirm that you will not remove or take any documents or proprietary data or materials of any kind, electronic or otherwise, with you from your current or former employer to the Company without written authorization from your current or former employer. If you have any questions about the ownership of particular documents or other information, discuss such questions with your former employer before removing or copying the documents or information.

 

Acceptance

This offer will remain open until close of business on 18 Jun 2024. To indicate your acceptance of the Company’s offer on the terms and conditions set forth in this letter, please sign and date this letter in the space provided below and return it to me no later than that date. Upon receipt of your signed acceptance of this offer letter, I will contact you to begin your onboarding process.

We hope your employment with the Company will prove mutually rewarding, and we look forward to having you join us.

By signing below, I acknowledge that I have been furnished with a copy of this offer and that I understand and agree to the terms set forth above. I understand that I will be an at-will employee and that nothing in this document is intended to create a contract of employment or alter the at-will nature of my employment.

Acknowledgment and Acceptance of Terms:

Regards,

Charlotte's Web Inc.

/s/Matt Rohrich	/s/Erika Lind
____________________________	________________________
Matt Rohrich	Erika Lind

 

 

 

Exhibit 99.1

 

 

 

PRESS RELEASE

 

Charlotte’s Web Appoints Erika Lind

as Chief Financial Officer

 

LOUISVILLE, Colo. - June 18, 2024 (TSX:CWEB) (OTCQX:CWBHF) Charlotte's Web Holdings, Inc. ("Charlotte's Web" or the "Company"), the leading provider of hemp-derived CBD wellness products, is pleased to announce the appointment of Erika Lind as Chief Financial Officer (CFO), replacing Jessica Saxton who has resigned from the Company to pursue other interests effective June 28^th, 2024. Ms. Lind’s appointment is effective June 29, 2024.

Erika Lind joined Charlotte’s Web in 2023 as Vice President of Financial Planning and Analysis (FP&A), and Treasury, where she has led strategic financial planning, performance management, and treasury operations. Ms. Lind came to Charlotte’s Web with more than two decades of executive financial leadership experience at several growth companies including Celestial Seasonings, Orica USA, Hammond’s Candies, and Spectra Logic Corp. Prior to joining Charlotte’s Web she was the former Vice President of Finance at Made in Nature LLC.

Bill Morachnick, Chief Executive Officer of Charlotte’s Web said, “We are excited for Erika to join the leadership team at Charlotte’s Web.  We are confident she is the right financial executive and leader to guide Charlotte’s Web to profitable business growth.”  

Ms. Lind's comprehensive background in financial planning, strategic analysis, and operational oversight positions her well to lead as CFO of Charlotte’s Web. Her experience in leveraging technology to enhance financial processes and her ability to manage high-performing teams aligns with the Company’s mission-driven culture.

Outgoing Chief Financial Officer Jessica Saxton will provide continuity and assist in successfully transitioning Ms. Lind into her new role as CFO. “We are grateful to Jessica for her significant contributions and financial stewardship during her tenure with Charlotte’s Web,” said Mr. Morachnick.  

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About Charlotte's Web Holdings, Inc.

Charlotte's Web Holdings, Inc., a Certified B Corporation headquartered in Louisville, Colorado, is the market leader in innovative hemp extract wellness products that includes Charlotte’s Web whole-plant full-spectrum CBD extracts as well as broad-spectrum CBD certified NSF for Sport®. Charlotte’s Web is the official CBD of Major League Baseball©, Angel City Football Club and the Premier Lacrosse League. Charlotte's Web branded premium quality products start with proprietary hemp genetics that are North American farm-grown using organic and regenerative cultivation practices. The Company's hemp extracts have naturally occurring botanical compounds including cannabidiol ("CBD"), CBN, CBC, CBG, 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, 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 health care practitioners throughout the U.S.A, and online through the Company's website at www.charlottesweb.com.     

 

© Major League Baseball trademarks and copyrights are used with permission of Major League Baseball. Visit MLB.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. This press release includes forward-looking statements pertaining to, but not limited to, the Company’s CFO transition. 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 development and other factors that it believes are appropriate and reasonable. 

The material factors and assumptions used to develop the forward-looking statements herein include but are not limited to assumptions relating to the Company’s general strategy and operations, executive leadership team and CFO transition plans. Material risk factors that could cause actual results to differ materially from the forward-looking statements include, among others, general economic and market risks, cyber-security risks and 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, 2023, and other risk factors contained in other filings with the Securities and Exchange Commission available on www.sec.gov and filings with Canadian securities regulatory authorities available on 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. 

 

For more information:

Cory Pala

Director of Investor Relations

[phone]

[e-mail]

 

 

 

 

 

 

Cover	Jun. 20, 2024	Jun. 17, 2024
Cover [Abstract]
Document Type		8-K
Amendment Flag		false
Document Period End Date		Jun. 17, 2024
Entity File Number		000-56364
Entity Registrant Name		Charlotte’s Web Holdings, Inc.
Entity Central Index Key		0001750155
Entity Tax Identification Number		98-1508633
Entity Incorporation, State or Country Code	A1
Entity Address, Address Line One		700 Tech Court
Entity Address, City or Town		Louisville
Entity Address, State or Province		CO
Entity Address, Postal Zip Code		80027
City Area Code		720
Local Phone Number		617-7303
Written Communications		false
Soliciting Material		false
Pre-commencement Tender Offer		false
Pre-commencement Issuer Tender Offer		false
Entity Emerging Growth Company		true
Elected Not To Use the Extended Transition Period		false

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