Charlotte's Web receives US$56.8M investment from BAT via convertible debenture

Charlotte's Web Holdings, Inc.

Convertible debenture principal C$75.3M (~US$56.8M), conversion price C$2.00/share, representing ~19.9% equity.
Interest rate 5% p.a., steps down to 1.5% upon U.S. federal regulation of CBD; maturity November 2029.
Proceeds to fund growth initiatives and R&D; pro-forma cash and short-term investments ~US$65M.
BAT gets board nomination rights: 20% of seats while ownership >=15%, stepping down to 10%.
BAT subject to 18-month lock-up on share dispositions after conversion of the debenture.

item 1.01 item 2.03 item 3.02 item 8.01 item 9.01

Key facts

Extracted from this filing and checked against the source text.

Material Agreements SEC 8-K Item 1.01/1.02 confidence 0.9

Charlotte's Web Holdings, Inc. entered into Subscription Agreement with BT DE Investments, Inc. valued at approximately US$56.8 million (C$75.3 million) (effective 2022-11-14).

Action: entry
Agreement: notes offering
Counterparty: BT DE Investments, Inc.
Value: approximately US$56.8 million (C$75.3 million)
Effective: 2022-11-14

Exact text from the filing

Effective as of November 14, 2022, Charlotte’s Web Holdings, Inc. (the “Company”) entered into a subscription agreement (the “Subscription Agreement”) with BT DE Investments, Inc. a wholly-owned subsidiary of BAT Group (LSE: BATS and NYSE: BTI), providing for the issuance of an approximately US$56.8 million (C$75.3 million) convertible debenture (the “Debenture”) that is convertible into 19.9% ownership of Charlotte’s Web common shares at a conversion price of C$2.00 per common share of the Company on the Toronto Stock Exchange (TSX).

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Material Agreements SEC 8-K Item 1.01/1.02 confidence 0.7

Charlotte's Web Holdings, Inc. entered into Investor Rights Agreement with BT DE Investments, Inc. (effective 2022-11-14).

Action: entry
Agreement: notes offering
Counterparty: BT DE Investments, Inc.
Effective: 2022-11-14

Exact text from the filing

greement”) with BT DE Investments, Inc. a wholly-owned subsidiary of BAT Group (LSE: BATS and NYSE: BTI), providing for the issuance

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283 material agreements filed in the last 30 days. Browse all material agreements →

Charlotte's Web Holdings, Inc. filing history →

Source: SEC EDGAR

accession 0001279569-22-001892

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