Abacus Health Products CBD Oil

Abacus Health Products announces the launch of its CBD CLINIC Massage Therapy Series, a line of eight new massage oils and creams. /PRNewswire/ – Charlotte’s Web Holdings, Inc. ("Charlotte’s Web" or the "Company") (TSX:CWEB, OTCQX:CWBHF), the world’s most trusted hemp extract and market… Charlotte’s Web Acquires Abacus Health Products BOULDER, Colo., June 11, 2020 /CNW/ – Charlotte’s Web Holdings, Inc. (“Charlotte’s Web” or the “Company”) (TSX: CWEB) (OTCQX: CWBHF), the company

Abacus Health Products Launches CBD CLINIC™ Massage Therapy Series

WOONSOCKET, R.I. & TORONTO–( BUSINESS WIRE )–Abacus Health Products, Inc. (CSE: ABCS, OTCQX: ABAHF) (“Abacus” or the “Company”) today announced the launch of its new CBD CLINIC Massage Therapy Series, a line of eight new massage oils and creams.

The CBD CLINIC Massage Therapy Series has been developed specifically for massage therapists and other Complementary and Alternative Medicine (CAM) practitioners. Introducing new aromatic botanicals and a newly formulated massage cream, the product line offers practitioners different levels of strength as well as, for the first-time, unscented versions of massage oil and cream.

CBD CLINIC products are currently sold to over 16,500 practitioners across the US, with around 30% of them being licensed massage therapists. According to the American Massage Therapy Association, it is estimated that there are around 300,000 licensed massage therapists in the United States, which represents one of the largest groups of health care practitioners in the country. Together with its distributor partners, Abacus has launched a dedicated marketing campaign to support the launch of the Massage Therapy Series.

Perry Antelman, CEO of Abacus said, “CBD CLINIC products were developed to offer health care practitioners solutions that provide superior pain relief for their patients. The Massage Therapy Series offers a newly formulated line developed to address the specific needs of massage therapy practitioners and reflects Abacus’ ability to innovate and develop the highest quality products. We look forward to continuing to lead and support the health care practitioner industry with additional new product introductions in the future.”

Forward-Looking Statements

This news release contains forward-looking statements or information (collectively, “forward-looking statements”) within the meaning of applicable securities legislation, including, without limitation, statements relating to the execution of the Company’s growth strategy. Forward-looking statements are based on a number of assumptions and are subject to a number of risks and uncertainties, many of which are beyond the Company’s control, that could cause actual results and events to differ materially from those that are disclosed in or implied by such forward-looking statements, including assumptions regarding the Company’s ability to efficiently operate its business, market and economic conditions, business prospects or opportunities, future plans and strategies, anticipated events and trends, and regulatory changes that may affect the Company and its customers and industry.

There can be no assurance that actual results will not differ materially from those expressed or implied in forward-looking statements. Undue reliance should not be placed on forward-looking statements. Additional information about these risks, uncertainties and assumptions is contained under “Risk Factors and Uncertainties” in the Company’s annual information form dated April 12, 2019, which is available under the Company’s SEDAR profile at www.sedar.com. Each forward-looking statement speaks only as of the date hereof, and the Company undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by applicable law.

About Abacus Health Products, Inc.

Abacus is engaged in the development and commercialization of over-the-counter (OTC) registered topical medications with active pharmaceutical ingredients and which contain organic and natural ingredients, including a cannabinoid-rich hemp extract containing CBD from the Cannabis sativa L plant. Abacus’ products are aimed at the rapidly growing markets for topical pain relief and therapeutic skincare and are based on proprietary patent-pending technologies developed by Abacus. Abacus’ formulations combine advanced science with organic and natural ingredients to provide safe relief. Abacus currently offers two lines of products: CBD CLINIC™, marketed to the professional practitioner market, and CBDMEDIC™, marketed to the consumer market. Abacus’ products are offered across the United States and are produced by a contract manufacturer in an FDA registered and audited manufacturing facility.

To learn more about Abacus, visit www.abacushp.com

Contacts

For further information:
Hank Hague, Chief Financial Officer
Email: [email protected]
Or
Bill Mitoulas, Investor Relations
Email: [email protected]
Office: 1.416.479.9547

Charlotte’s Web to Acquire Abacus Health Products for Combined 35% Marketshare of CBD in Food/Drug/Mass Retail Channel

BOULDER, CO , WOONSOCKET, RI and TORONTO , March 23, 2020 /PRNewswire/ – Charlotte’s Web Holdings, Inc. (“Charlotte’s Web” or the “Company“) (TSX:CWEB,OTCQX:CWBHF), the world’s most trusted hemp extract and market leader in hemp-derived cannabidiol (“CBD“) wellness products, and Abacus Health Products, Inc. (“Abacus“) (CSE:ABCS,OTCQB:ABAHF), a leader in over-the-counter (“OTC“) topical products combining active pharmaceutical ingredients with hemp extract, are pleased to announce that they have entered into a definitive arrangement agreement (the “Arrangement Agreement“) pursuant to which Charlotte’s Web proposes to acquire all of the issued and outstanding subordinate voting shares of Abacus (the “Abacus Shares“), after conversion of all outstanding proportionate voting shares of Abacus into Abacus Shares (the “Transaction“). Under the terms of the Arrangement Agreement, shareholders of Abacus (“Abacus Shareholders“) will receive 0.85 of a common share of Charlotte’s Web (“Charlotte’s Web Share“) for each Abacus Share held (the “Exchange Ratio“). The Exchange Ratio implies a price per Abacus Share of C$4.39 , representing a premium of 38% based on the 10-day volume weighted average price (“VWAP“) of the Abacus Shares on the Canadian Securities Exchange (“CSE“) and the 10-day VWAP of the Charlotte’s Web Shares on the Toronto Stock Exchange (“TSX“) as of March 20, 2020 , for implied total equity consideration of approximately C$99 million .

This acquisition combines Charlotte’s Web, the market leader in hemp-derived CBD wellness products, with Abacus, the market leader in OTC topical products combining active pharmaceutical ingredients with hemp extract, to create the world’s largest vertically integrated hemp-derived CBD company. For Charlotte’s Web the combination benefits from the current U.S. regulatory environment which favors topical- CBD products within the food/drug/mass (“F/D/M“) channel. For Abacus, the acquisition provides the advantages of joining an established and industry leading platform and benefiting from leading CPG management and brand equity with a low-cost vertical supply chain producing “the world’s most trusted hemp extract™”. The combined entity is anticipated to represent approximately 34.7% 3 of U.S. CBD sales within the F/D/M channel. Combined sales for the third quarter of 2019 were $29.1 million .

Since its inception in 2014, Abacus has focused on becoming the leading practitioner and consumer choice for OTC topical medications with active pharmaceutical and natural ingredients, including a cannabinoid-rich hemp extract containing CBD. Abacus currently distributes over 50 SKUs through approximately 12,000 unique doors and 16,500 health-care practitioners. Combined with Charlotte’s Web, the Transaction will reinforce Charlotte’s Web’s leading position in the CBD market, and substantially expand its existing topical offerings and presence in the key F/D/M channel.

KEY STRATEGIC HIGHLIGHTS:

  • Expands Charlotte’s Web product portfolio for the Topicals category, forecasted to become fastest growing and largest CBD segment by 2021 1 , by targeting specific need states to drive greater category reach
    • Immediate expansion of the topical segment driven by Abacus’ patent-pending technologies that deliver OTC topical medications with active pharmaceutical ingredients to target specific pain relief need states
    • Further expands Charlotte’s Web’s breadth and depth into the retail skincare segment
    • Expands Charlotte’s Web’s reach to the personal care and beauty segment through the Harmony Hemp brand which was acquired by Abacus in February, 2020
    • Positions Charlotte’s Web at the forefront of the growing and valuable sports landscape through existing Abacus partnerships
    • Abacus’ proven best-in-class innovation, expertise with OTC topical medications and speed to market
    • Charlotte’s Web’s proprietary genetics and significant hemp cannabinoid knowledge
    • Newly created and scientifically led CW Labs to deliver cutting-edge innovation in wellness
    • Food/Drug/Mass retail combined share of 34.7%, +16.9 ppts vs the leading competitor 3
      • Food retail combined share of 23.0%, +5.0 ppts vs the leading competitor 3
      • Drug retail combined share of 43.5%, +25.8 ppts vs the leading competitor 3
      • Enhances Charlotte’s Web’s leading Direct to the Consumer (DTC) platform with an expanded topical and OTC personal care portfolio
      • Charlotte’s Web’s 11,000 retail doors combine with 12,000 from Abacus for 15,000 unique doors
      • Abacus’s network of 16,500 medical and practitioners expands channel served by both companies and presents cross-selling opportunities
      • Enables Abacus to utilize Charlotte’s Web’s high-quality hemp extract across product portfolio
      • Provides economies of scale to create in-market cost advantage

      KEY STAKEHOLDER BENEFITS:

      • Significant Market Opportunity – the Abacus product portfolio significantly strengthens Charlotte’s Web’s topical access into two adjacent markets: Pain Relief, a US$7.4 billion market, and Therapeutic Skincare, a US$2.6 billion market; 3
      • Experienced Operating Team & Best Practice – combined management team with industry leading CPG experience to drive operational excellence, best in class marketing, proven innovation, unique digital/data capability and advantaged customer/channel relationships;
      • Significant Synergies Anticipated – Expect meaningful synergies from economies of scale, production (scaling of low cost manufacturing and extraction), elimination of public company cost duplication, bolstered by extended sales opportunities through cross-selling and leveraging additional distribution channels: expansion of topical portfolio through DTC, F/D/M and B2B channels;
      • Immediate Premium to Abacus Shareholders – premium of 38% based on the 10-day VWAP of the Abacus Shares on the CSE as of March 20, 2020 ;
      • Continued Participation by Abacus Shareholders – Abacus Shareholders will represent approximately 15% of the issued and outstanding Charlotte’s Web Shares (based on the fully diluted share capital of each of Charlotte’s Web and Abacus, each on an as-converted basis, as of the date of this announcement), allowing Abacus Shareholders the opportunity to participate in the synergies and anticipated value created through the Transaction;
      • Accretive to Charlotte’s Web Shareholders – the Transaction is anticipated to be accretive to Charlotte’s Web shareholders on an Adjusted EBITDA basis; and
      • Increased Scale, Balance Sheet Strength & Capital Markets Presence – the combined entity’s expanded capital markets profile is expected to appeal to a broader shareholder audience, enhance trading liquidity and increase weighting in index tracking portfolio. Additionally, pro forma for the acquisition, the Company’s cash position at Dec. 31, 2019 , is estimated at US$90.4 million .

      MANAGEMENT COMMENTARY

      “The complementary strengths of our relative market positions made this merger a logical strategic move,” said Deanie Elsner , Chief Executive Officer of Charlotte’s Web. “With this acquisition we strengthen the business to reflect the evolution of the category. Because most of Abacus’s products are positioned in adjacent categories, our combined distribution reach has limited shelf overlap. Together we are the most developed CBD company across every channel and segment and positioned to accelerate our growth and extend our market share. Furthermore, it enables us to drive more scale production through our vertically integrated infrastructure.”

      “This Transaction provides a unique opportunity to our shareholders and employees to participate in the compelling potential of the combined businesses,” said Perry Antelman , Chief Executive Officer of Abacus. “Abacus is one of the largest suppliers and distributors in the United States of topical products infused with hemp extract to the F/D/M and healthcare practitioner markets. By joining with Charlotte’s Web, we have the opportunity to maximize our growth by leveraging the Company’s leading brand, vertical integration, infrastructure, expertise, financial position and capital markets presence, and position the combined Company to deliver benefits for our stakeholders over the long-term.”

      TERMS OF THE TRANSACTION

      The Transaction will be affected by way of an arrangement under the Business Corporations Act ( Ontario ). Under the terms of the Arrangement Agreement, Charlotte’s Web will acquire all of the issued and outstanding Abacus Shares, with each Abacus Shareholder receiving 0.85 of a Charlotte’s Web Share for each Abacus Share, which, based on the 10-day VWAP of Charlotte’s Web Shares of C$5.17 , represents a total consideration of C$99 million or C$4.39 per Abacus Share. After giving effect to the Transaction, Abacus Shareholders will hold approximately 19.2 million Charlotte’s Web Shares (representing approximately 15% of the issued and outstanding pro forma Charlotte’s Web Shares (on a fully diluted basis and on an as-converted basis), as of the date of this announcement).

      The Transaction has been unanimously approved by the Board of Directors of each of Charlotte’s Web and Abacus. Abacus Shareholders holding approximately 20% of the basic issued and outstanding Abacus Shares (assuming conversion of all proportionate voting shares of Abacus) have entered into voting and support agreements to vote in favor of the Transaction. Perry Antelman , CEO of Abacus, who owns approximately 4.3% of the basic issued and outstanding Abacus Shares (assuming conversion of all proportionate voting shares of Abacus), is expected to fill a key leadership role in Charlotte’s Web and has executed a new employment agreement, as well as a lock-up agreement in connection with the Transaction, which will restrict the sale of his resulting Charlotte’s Web Shares for a 15-month period post-closing with incremental release commencing in six months.

      The Arrangement Agreement provides for customary representations, warranties and covenants, including a termination fee in the amount equal to C$4.0 million , payable by Abacus in the event that the Arrangement Agreement is terminated in certain circumstances. The Arrangement Agreement also provides for a non-solicitation covenant and a provision for the right to match any superior proposal in favor of Charlotte’s Web.

      The Transaction is subject to, among other things, the approval of Abacus Shareholders at a special meeting (the “Special Meeting“) expected to be convened by Abacus, receipt of required regulatory and court approvals and other customary conditions of closing. Approval of Charlotte’s Web shareholders is not required. Additional details of the Transaction will be provided to Abacus Shareholders in an information circular to be mailed in connection with the Special Meeting. It is currently anticipated that, subject to receipt of all regulatory, court, shareholder and other approvals, the Transaction will be completed in the second quarter of 2020.

      The Board of Directors of Abacus unanimously recommends that Abacus Shareholders vote in favor of the resolution to approve the Transaction at the Special Meeting and has determined that the consideration offered to the holders of Abacus Shares is fair, from a financial point of view, to the Abacus Shareholders. The Board of Directors of Abacus has obtained a fairness opinion from Greenhill & Co. Canada Ltd. that states that the consideration to be received by holders of Abacus shares pursuant to the Plan of Arrangement is fair, from a financial point of view, to the holders of Abacus Shares.

      FINANCIAL AND LEGAL ADVISORS

      Canaccord Genuity Corp. acted as financial advisor and DLA Piper ( Canada ) LLP acted as legal counsel to Charlotte’s Web. Canaccord Genuity Corp. provided a fairness opinion to the Board of Directors of Charlotte’s Web.

      Greenhill & Co. Canada Ltd. acted as financial advisor and Osler , Hoskin & Harcourt LLP acted as legal counsel to Abacus. Greenhill & Co. Canada Ltd. provided a fairness opinion to the Board of Directors of Abacus.

      CONFERENCE CALL AND INVESTOR PRESENTATION

      Charlotte’s Web will discuss the transaction during its 2019 year-end conference call and webcast and answer analyst questions at 8:30 am ET on Tuesday, March 24, 2020 . Charlotte’s Web CEO Deanie Elsner and CFO Russ Hammer will host the call, followed by a question and answer period. To participate in the call, please dial 1-647-427-7450 or 1-888-231-8191 approximately 10 minutes before the conference call. A recording of the call will be available through March 31 , 2020. To listen to a replay of the earnings call please dial 1-416-849-0833 and provide conference ID 3252968. A webcast of the call will also be accessible through the investor relations section of the Charlotte’s Web website.

      ABOUT ABACUS HEALTH PRODUCTS, INC.

      Abacus is engaged in the development and commercialization of over-the-counter (OTC) topical medications with active pharmaceutical ingredients and which contain organic and natural ingredients, including a cannabinoid-rich hemp extract containing CBD from the Cannabis sativa L plant. Abacus’ products are aimed at the rapidly growing markets for topical pain relief and therapeutic skincare and are based on proprietary patent-pending technologies developed by Abacus. Abacus’ formulations combine advanced science with organic and natural ingredients to provide safe relief. Abacus currently offers three lines of products: CBD CLINIC™, marketed to the professional practitioner market, and CBDMEDIC™ and Harmony Hemp™, marketed to the consumer market. Abacus’ products are offered across the United States and are produced by a contract manufacturer in an FDA registered and audited manufacturing facility.

      As of March 23, 2020 , Abacus had 11,991,471 Subordinate Voting Shares outstanding and 95,873.3 Proportional Voting Shares convertible at 100:1 into Subordinate Voting Shares, for an effective equivalent of 21,578,837 Subordinate Voting Shares outstanding

      To learn more about Abacus, visit www.abacushp.com

      ABOUT CHARLOTTE’S WEB HOLDINGS, INC.

      Charlotte’s Web Holdings, Inc. is the market leader in the production and distribution of innovative hemp-derived cannabidiol (“CBD”) wellness products. Founded by the Stanley Brothers, the Company’s premium quality products start with proprietary hemp genetics that are responsibly manufactured into hemp-derived CBD extracts naturally containing a full spectrum of phytocannabinoids, including CBD, terpenes, flavonoids and other beneficial hemp compounds. Charlotte’s Web product categories include CBD oil tinctures (liquid products), CBD capsules, CBD topicals, as well as CBD pet products. Charlotte’s Web hemp-derived CBD extracts are sold through select distributors, brick and mortar retailers, and online through the Company’s ADA compliant website at www.CharlottesWeb.com.

      As of March 23, 2020 , Charlotte’s Web had 71,448,314 Common Shares outstanding and 92,455.88 Proportional Voting Shares convertible at 400:1 into Common Shares, for an effective equivalent of 108,430,544 Common Shares outstanding.

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      Forward-Looking Information

      Certain information in this news release constitutes forward-looking statements and forward-looking information (collectively, “forward-looking information”). In some cases, but not necessarily in all cases, forward looking information can be identified by the use of forward-looking terminology such as “plans”, “targets”, “expects” or “does not expect”, “is expected”, “an opportunity exists”, “is positioned”, “estimates”, “intends”, “assumes”, “anticipates” or “does not anticipate” or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might”, “will” or “will be taken”, “occur” or “be achieved”. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances contain forward-looking information. Statements containing forward-looking information are not historical facts but instead represent management’s expectations, estimates and projections regarding future events.

      This news release contains forward-looking statements and information within the meaning of applicable securities legislation. Often, but not always, forward-looking statements and information can be identified by the use of words such as “plans”, “expects” or “does not expect”, “is expected”, “estimates”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved. Forward-looking statements or information involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Charlotte’s Web, Abacus or their respective subsidiaries to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements or information contained in this news release. These forward-looking statements include, but are not limited to, statements relating to expectations with respect to: the timing and outcome of the Transaction; the anticipated benefits of the Transaction to the parties and their respective security holders; impact of the Transaction and anticipated growth of the combined entity; and the anticipated timing of the Special Meeting‎.

      Risks, uncertainties and other factors involved with forward-looking information could cause actual events, results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking information, including assumptions as to the time required to prepare and mail security holder meeting materials; the ability of the parties to receive, in a timely manner and on satisfactory terms, the necessary regulatory, court and shareholder approvals; including any approval required under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended; the disruption to the functioning of the regulatory bodies that provide the necessary regulatory and court approvals or any ancillary disruption, anticipated or otherwise, due to the outbreak of the novel coronavirus (COVID-19) will not affect the timing or completion of the Transaction in the manner contemplated by the Arrangement Agreement; the ability of the parties to satisfy, in a timely manner, the conditions to closing; other expectations and assumptions concerning the Transaction; and such risks contained in Charlotte’s Web’s annual information form dated April 29, 2019 and in Abacus’ annual information form dated April 12, 2019 and filed with Canadian securities regulators available on Charlotte’s Web’s and Abacus’ respective issuer profiles on SEDAR at www.sedar.com. Readers are cautioned that the foregoing list of factors is not exhaustive.

      In respect of the forward-looking statements and information concerning the anticipated benefits and completion of the Transaction and the anticipated timing for completion of the Transaction, Charlotte’s Web and Abacus have provided such statements and information in reliance on certain assumptions that they believe are reasonable at this time. Although Charlotte’s Web and Abacus believe that the assumptions and factors used in preparing the forward-looking information or forward-looking statements in this news release are reasonable, undue reliance should not be placed on such information and no assurance can be given that such events will occur in the disclosed time frames or at all. The forward-looking statements and information included in this news release are made as of the date of this news release and Charlotte’s Web and Abacus do not undertake an obligation to publicly update such forward-looking information or forward-looking information to reflect new information, subsequent events or otherwise unless required by applicable securities laws.

      There can be no assurance that the Transaction will occur, or that it will occur on the terms and conditions contemplated in this news release. The Transaction could be modified, restructured or terminated. Actual results could differ materially from those currently anticipated due to a number of factors and risks.

      The Transaction cannot close until the required shareholder, court and regulatory approval is obtained. There can be no assurance that the Transaction will be completed as proposed or at all. Investors are cautioned that, except as disclosed in the management information circular to be prepared in connection with the Special Meeting, any information released or received with respect to the Transaction may not be accurate or complete and should not be relied upon.

      Non-GAAP Measures

      Certain supplementary measures in this news release do not have any standardized meaning as prescribed under International Financial Reporting Standards (“IFRS“), which are also generally accepted accounting principles (“GAAP“) for publicly accountable entities in Canada , and, therefore, are considered non-GAAP measures. Since non-GAAP measures are unlikely to be comparable to similar measures presented by other companies, securities regulations require that non-GAAP measures be clearly defined, qualified and reconciled to their nearest GAAP measure. Except as otherwise indicated, these non-GAAP measures are calculated and disclosed by Charlotte’s Web on a consistent basis from period to period. Specific adjusting items may only be relevant in certain periods.

      The intent of non-GAAP measures is to provide additional useful information with respect to Charlotte’s Web’s operational and financial performance to investors and analysts though the measures do not have any standardized meaning under IFRS. The measures should not, therefore, be considered in isolation or used in substitute for measures of performance prepared in accordance with IFRS. Other issuers may calculate these non-GAAP measures differently.

      In particular, the term “Adjusted EBITDA” is used in this news release to describe certain financial information of Charlotte’s Web. Adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA“) is not a recognized performance measure under IFRS. The term EBITDA consists of net income (loss) and excludes interest, taxes, depreciation and amortization. Adjusted EBITDA also excludes share-based compensation, IPO and share offering related costs, mark-to-mark fair value adjustments, impairment of assets and adjustments for fair valuing of biological assets. Adjusted EBITDA is included as a supplemental disclosure because management of Charlotte’s Web believes that such measurement provides a better assessment of Charlotte’s Web’s operations on a continuing basis by eliminating certain non-cash charges and charges or gains that are nonrecurring.

      For more information with respect to financial measures which have not been defined by GAAP, including reconciliations to the closest comparable GAAP measure, see Charlotte’s Web’s management discussion and analysis accompanying its most recent audited annual financial statements, which are available on SEDAR.

      Brightfield Group (January 2020) U.S. CBD Report: “U.S. CBD Market Size & Forecast”.

      Charlotte’s Web Acquires Abacus Health Products

      BOULDER, Colo., June 11, 2020 /CNW/ – Charlotte’s Web Holdings, Inc. (“Charlotte’s Web” or the “Company”) (TSX: CWEB) (OTCQX: CWBHF), the company behind the world’s most trusted hemp extract, and Abacus Health Products, Inc. (“Abacus”) (CSE: ABCS) (OTCQB: ABAHF), a leader in over-the-counter topical products combining active pharmaceutical ingredients with hemp extract, are pleased to announce that they have completed the previously-announced plan of arrangement (the “Arrangement”). Pursuant to the Arrangement, Charlotte’s Web acquired all the issued and outstanding subordinate voting shares of Abacus (the “Abacus Shares”). All the outstanding proportionate voting shares of Abacus were converted into Abacus Shares prior to closing of the Arrangement. Pursuant to the Arrangement, holders of Abacus Shares received 0.85 (the “Exchange Ratio”) of a common share of Charlotte’s Web for each Abacus Share held at the time of closing.

      Charlotte’s Web is America’s largest vertically integrated hemp-derived CBD company. Combined, the companies distribute to more than 21,000 unique retail locations with limited shelf overlap due to adjacent but complementary positions across the ingestible and topical CBD product categories. Recently Charlotte’s Web added 1,100 new drug stores, more than 700 pet stores, and Abacus added more than 5,000 retail doors with the signing of a new retail partner.

      Joining the Charlotte’s Web family of brands are Abacus’ consumer brands CBD MEDIC™ and Harmony Hemp, and for professional practitioners, Abacus’ CBD CLINIC™ brand. Substantial product cross selling opportunities are available through each company’s respective distribution network. Starting in July, multiple Abacus topical products will be available for purchase through Charlotte’s Web’s leading Direct to the Consumer (DTC) ecommerce platform.

      The addition of Abacus Health cements a market leading position in both topical and ingestible products in the CBD category, representing approximately 33%¹ market share of the U.S. CBD food/drug/mass retail channel.

      Deanie Elsner, Chief Executive Officer of Charlotte’s Web

      We thank the founders and team members of both Charlotte’s Web and Abacus for their vision and hard work to build our respective vital brands. We are now one dynamic team and mission-driven company.

      Perry Antelman has been the CEO of Abacus since 2016 and will join Charlotte’s Web, effective today, as Executive Vice President and President of Topicals.

      Following the closing of this acquisition, on June 11, 2020, Charlotte’s Web has 90,287,520 Common Shares outstanding and 92,455.5775 Proportionate Voting Shares convertible at 400:1, for an effective equivalent of 127,269,751 aggregate Common Shares outstanding.

      With the completion of the Arrangement, the Abacus Shares and common share purchase warrants of Abacus listed under the symbol “ABCS.WT” on the Canadian Securities Exchange (the “Abacus Warrants”) are expected to be de-listed from the Canadian Securities Exchange at the close of trading on or about June 11, 2020. On close of the Arrangement, each Abacus Warrant outstanding immediately prior to closing was exchanged for a common share purchase warrant of Charlotte’s Web (the “Replacement Warrants”) that entitles the holder to acquire common shares of Charlotte’s Web in lieu of Abacus Shares, subject to adjustment in number and exercise price to give effect to the Exchange Ratio. Charlotte’s Web has applied to list the Replacement Warrants on the Toronto Stock Exchange (the “TSX”) and it is anticipated that, subject to satisfaction of the TSX listing requirements, the Replacement Warrants will begin trading on the TSX under the symbol “CWEB.WS” at market open on or about June 15, 2020.

      In order to receive the consideration in exchange for their Abacus Shares, registered shareholders must complete, sign, date and return the Letter of Transmittal that was mailed to each registered shareholder of Abacus. The Letter of Transmittal is also available from Abacus’ depositary, Odyssey Trust Company. Non-registered holders of Abacus Shares whose Abacus Shares are registered in the name of a broker, investment dealer, bank, trust company, trustee or other intermediary or nominee should contact that intermediary or nominee for assistance in depositing their Abacus Shares and should follow instructions of such intermediary or nominee in order to deposit their Abacus Shares.

      Further information about the Arrangement is set out in the Abacus’ management information circular dated May 4, 2020, which can be accessed online under Abacus’ issuer profile on SEDAR at www.sedar.com.

      [1] Nielsen AOD HBC and Pet Care CBD: 52 weeks ending May 16th, 2020

      ABOUT ABACUS HEALTH PRODUCTS, INC.

      Abacus is engaged in the development and commercialization of over-the-counter (OTC) topical medications with active pharmaceutical ingredients and which contain natural ingredients, including a cannabinoid-rich hemp extract. Abacus’ products are aimed at the rapidly growing markets for topical pain relief and therapeutic skincare and are based on proprietary patent-pending technologies developed by Abacus. Abacus’ formulations combine advanced science with organic and natural ingredients to provide safe relief. Abacus currently offers three lines of products: CBD CLINIC™, marketed to the professional practitioner market, and CBDMEDIC™ and Harmony Hemp™, marketed to the consumer market. Abacus’ products are offered across the United States and are produced by a contract manufacturer in an FDA registered and audited manufacturing facility. To learn more about Abacus, visit www.abacushp.com

      ABOUT CHARLOTTE’S WEB HOLDINGS, INC.

      Charlotte’s Web Holdings, Inc. is the market leader in the production and distribution of innovative hemp-derived cannabidiol (“CBD”) wellness products. The Company was founded by the Stanley Brothers on a mission to unleash the healing power of botanicals through compassion and science to benefit the planet and all who live upon it. The Company’s premium quality products start with proprietary hemp genetics that are responsibly manufactured into hemp-derived CBD extracts naturally containing a full spectrum of phytocannabinoids, including CBD, terpenes, flavonoids and other beneficial hemp compounds. Charlotte’s Web product categories include CBD oil tinctures (liquid products), CBD capsules, CBD topicals, as well as CBD pet products. Charlotte’s Web hemp-derived CBD extracts are sold through select distributors, brick and mortar retailers, and online through the Company’s ADA compliant website at www.CharlottesWeb.com.

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