Recent Updates — CWBHF

Charlotte’s Web Holdings, Inc.’s subsidiary entered into a Convertible Promissory Note with DeFloria, Inc., a joint venture involving the company, AJNA BioSciences, and British American Tobacco. The note carries an aggregate principal amount of $1,582,500, superseding a prior instrument. Interest accrues at 8.0% plus the Bank of England Base Rate, initially set at 11.25% per annum and capped at 14%. The debt automatically converts upon DeFloria’s qualified financing of at least $10 million in new preferred stock, utilizing a conversion price based on an $146 million valuation cap or a discount to investor pricing. Charlotte's Web Holdings operates in the cannabis industry.

Charlotte’s Web Holdings reported second quarter 2026 results featuring a fundamental balance sheet restructuring. The company completed a transaction with British American Tobacco subsidiary BAT DE Investments Inc., converting C$75.3 million of convertible debentures into common shares and receiving a $10 million private placement equity investment. This recapitalization eliminated the largest liability, reduced total liabilities by 74% to $20.3 million, and restored positive shareholders' equity to $56.1 million from a deficit. Cash reserves increased to $14.0 million. Financially, revenue declined 15.2% year-over-year to $10.9 million due to retail channel restructuring, while gross margin expanded to 47.5%. The company reported a net loss of $4.1 million, or $(0.02) per share, compared to a $6.3 million loss in the prior year period. Charlotte’s Web operates as a botanical wellness innovation company and market leader in cannabidiol (CBD) hemp extract products.

Charlotte’s Web Holdings, Inc. closed a subscription agreement with BAT for the purchase of 14,662,765 shares at C$0.94 per share for a total of C$13,873,000. Concurrently, BAT converted its convertible debenture into 95,281,277 shares at C$0.94 per share, resulting in a total holding of 109,944,042 shares, or approximately 40.6% of the company. The companies also entered into an amended and restated investor rights agreement regarding board nominations and other protections.