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This proxy statement is dated April 28, 2022, and is first being made available to shareholders on or about

April 29, 2022.

The annual general meeting (the “Meeting”) of holders of common shares (“Common Shares”) of Charlotte’s Web Holdings, Inc., a ‎British Columbia corporation (the “Company”), will be a virtual meeting held on June 22, 2022 beginning at ‎‎10:00 a.m. (Mountain Time), at http://www.virtualshareholdermeeting.com/CWEB2022. ‎You will be able to attend the Meeting as well as submit your questions during the live webcast of the Meeting by entering the 16-digit control number included in your Notice of Internet Availability of Proxy Materials, on your form of proxy or in the instructions that accompanied your proxy materials.

The following matters will be considered at the Meeting:‎

This Notice of Meeting is accompanied by the: (1) proxy statement; (2) the accompanying form of proxy (“Proxy ‎Instrument”); (3) the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 (including the audited annual ‎consolidated financial statements of the Company for the fiscal year ended December 31, 2021, together with ‎the notes thereto, and the independent auditor’s report thereon and the related management’s discussion and ‎analysis); and (4) a request for financial statement form for the fiscal year ended December 31, 2022 (collectively, the “proxy materials”). As permitted by applicable securities law, the Company is using notice-and-access to deliver the ‎proxy materials to shareholders. This means that the proxy materials are being posted online to access, rather ‎than being mailed out. Notice-and-access substantially reduces the Company’s printing and mailing costs and is ‎environmentally friendly as it reduces paper and energy consumption.

The proxy materials are available on the “Investor Relations” section of the Company’s website at www.investors.charlottesweb.com, SEDAR at ‎www.sedar.com and the SEC’s website at www.sec.gov. On or about April 29, 2022, we will mail our shareholders a Notice of Internet Availability of Proxy Materials containing instructions on how to access our proxy materials and vote online. The notice also provides instructions on how you can request proxy materials be sent to you by mail or email and how you can enroll to receive proxy materials by mail or email for future meetings.

The record date for the determination of shareholders of the Company entitled to receive notice of and to vote ‎at the Meeting or any adjournment(s) or postponement(s) thereof is April 25, 2022 (the “Record Date”). Holders of Common Shares of the ‎Company whose names have been entered in the register of shareholders of the Company at the close of ‎business on the Record Date will be entitled to receive notice of and to vote at the Meeting or any ‎adjournment(s) or postponement(s) thereof.‎ On November 3, 2021, all outstanding proportionate voting shares (“PVS”) of the Company were converted by way of mandatory conversion in accordance with the Company’s articles and at the discretion of the Company, into Common Shares. Pursuant to the Company’s articles, the Company is no longer authorized to issue additional PVS and as of April 25, 2022 nil PVS are outstanding.

A shareholder of the Company may attend the Meeting live via webcast or may be represented by proxy. ‎Registered shareholders of the Company who are unable to attend the Meeting or any adjournment(s) or postponement(s) ‎thereof via the webcast are requested to date, sign and return the accompanying Proxy Instrument for use at ‎the Meeting or any adjournment(s) or postponement(s) thereof.‎

Your proxy or voting instructions must be ‎received in each case no later than 11:59 p.m. (Eastern Time) on June 21, 2021 or, if the Meeting is adjourned or postponed, at ‎least 48 hours (excluding Saturdays, Sundays and statutory holidays in the Province of British Columbia) before ‎the beginning of any adjournment(s) or postponement(s) to the Meeting.‎ We encourage shareholders currently planning to participate in the Meeting to submit their votes or form of proxy in advance so that their votes will be counted in the event of technical difficulties.

If you are a non-registered shareholder of the Company and receive these materials through your broker or another intermediary, please complete and return the materials in accordance with the instructions provided to you by your broker or such other intermediary.

Whether or not you plan to attend the Meeting via live webcast, we encourage you to read this proxy ‎statement and promptly vote your shares. For specific instructions on how to vote your shares, please refer to ‎the section entitled “How You Can Vote” and to the instructions on your Notice of Internet Availability of Proxy Materials or voting instruction card.‎

This proxy statement is furnished in connection with the solicitation by management of Charlotte’s Web Holdings, Inc. of proxies to be used at the 2022 annual general meeting ‎‎(the “Meeting”) of the holders of Common Shares of the Company referred to in the accompanying Notice of Meeting, to be held on June 22, 2022 via live webcast beginning at 10:00 ‎a.m. (Mountain Time) at:

http://www.virtualshareholdermeeting.com/CWEB2022.

Unless the ‎context otherwise requires, references to “we,” “us,” “our,” “Company” or “Charlotte’s Web” or similar terms refers ‎to Charlotte’s Web Holdings, Inc. together with its wholly-owned subsidiaries. The mailing address of our principal ‎executive offices is 1801 California Street, Suite 4800, Denver, CO 80202.‎

All properly submitted proxies will be voted in accordance with the instructions contained in those proxies. If no ‎instructions are specified, the proxies will be voted in accordance with the recommendation of our Board with ‎respect to each of the matters set forth in the accompanying Notice of Meeting. You may revoke your proxy by following the instructions set out under the heading “May I change or revoke my vote?”.‎

We made this proxy statement and our Annual Report on Form 10-K for the fiscal year ended December ‎‎31, 2021, available to shareholders on April 29, 2022.‎

We are an “emerging growth company” under applicable U.S. federal securities laws and therefore permitted to ‎conform with certain reduced public company reporting requirements. As an emerging growth company, we ‎provide in this proxy statement the scaled disclosure permitted under the U.S. Jumpstart Our Business Startups ‎Act of 2012 (the “JOBS Act”). In addition, as an emerging growth company, we are not required to conduct ‎votes seeking approval, on an advisory basis, of the compensation of our named executive officers or the ‎frequency with which such votes must be conducted. We may take advantage of these exemptions until the last ‎day of the fiscal year in which the fifth anniversary of our initial public offering occurs (December 31, 2026) or ‎such earlier time that we are no longer an emerging growth company. We would cease to be an emerging growth ‎company if we have more than $1.07 billion in annual revenues as of the end of a fiscal year, if we are deemed ‎to be a large-accelerated filer under the rules of the U.S. Securities and Exchange Commission (the “SEC”) or if ‎we issue more than $1.0 billion of non-convertible debt over a three-year period.‎

This proxy statement and our Annual Report on Form 10-K for the fiscal year ended December 31, 2021 ‎are available for viewing, printing and downloading at www.proxyvote.com, on the “Investor Relations” section of our website at ‎www.investors.charlottesweb.com, the SEC’s website at www.sec.gov and SEDAR at www.sedar.com.

A copy of this proxy statement and our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, as filed with the SEC ‎on March 24, 2022, except for exhibits, will be furnished without charge to any shareholder if requested prior to June 8, 2022. If you would like to request a copy of the material(s) for this and/or future shareholder meetings, you may (1) visit www.ProxyVote.com, (2) call 1-800-579-1639 or (3) send an email to sendmaterial@proxyvote.com. If sending an email, please include your control number (indicated below) in the subject line. Unless requested, you will not otherwise receive a paper or email copy. You may also make a written request ‎to our Corporate Secretary at legal@charlottesweb.com.

All references to currency in this proxy statement are in United States dollars, unless otherwise indicated. References to “C$” refer to Canadian dollars.

Management of the Company is using this proxy statement to solicit proxies for use at the Meeting to be held via live webcast on ‎June 22, 2022.

The following proxy materials are being posted online to access, rather ‎than being mailed out: (1) proxy statement; (2) the Proxy Instrument; (3) the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 (including our audited annual ‎consolidated financial statements of the Company for the fiscal year ended December 31, 2021, together with ‎the notes thereto, and the independent auditor’s report thereon and the related management’s discussion and ‎analysis); and (4) a request for financial statement form for the fiscal year ended December 31, 2022. As permitted by applicable securities law, the Company is using notice-and-access to deliver the ‎proxy materials to shareholders.

As a shareholder, you are invited to attend the Meeting and are entitled and requested to vote on the business ‎items described in this proxy statement. This proxy statement is furnished in connection with the solicitation of ‎proxies by or on behalf of management of the Company. This proxy statement is designed to ‎assist you in voting your shares and includes information that we are required to provide under the rules of the ‎SEC and applicable Canadian securities laws.‎

These proxy materials are being sent to both registered and non-registered shareholders. In some instances, the ‎Company has distributed copies of the Notice, the proxy statement, the accompanying Proxy Instrument and the Company’s Annual Report on Form 10-K ‎‎(collectively, the “Documents”) to clearing agencies, securities dealers, banks and trust companies, or their ‎nominees (collectively “Intermediaries”, and each an “Intermediary”) for onward distribution to ‎shareholders whose shares are held by or in the custody of those Intermediaries (“Non-registered ‎Shareholders”). The Intermediaries are required to forward the Documents to Non-registered Shareholders.‎

In accordance with applicable laws, Non-registered Shareholders who have advised their Intermediary that they do not object to the Intermediary providing their ownership information to issuers whose securities they beneficially own (“NOBOs”) will receive by mail a letter with respect to the Notice of Internet Availability of Proxy Materials. NOBOs who have standing instructions with the Intermediary for physical copies of this proxy statement will receive by mail the Notice of Internet Availability of Proxy Materials, the Notice and the proxy statement.

Management of the Company does not intend to pay for Intermediaries to forward the Notice of Internet Availability of Proxy Materials to Non-Registered Holders who have advised their Intermediary that they object to the Intermediary providing their ownership information (“OBOs”). An OBO will not receive the Notice of Internet Availability of Proxy Materials unless the Intermediary assumes the cost of delivery.

Solicitation of proxies from Non-registered Shareholders will be carried out by Intermediaries, or by the ‎Company if the names and addresses of Non-registered Shareholders are provided by the ‎Intermediaries.‎

Non-registered Shareholders who have received the Documents from their Intermediary should follow the ‎directions of their Intermediary with respect to the procedure to be followed for voting at the Meeting. Generally, ‎Non-registered Shareholders will either:‎

If you are a Non-registered Shareholder and the Company or its agent has sent these materials directly to ‎you, your name and address and information about your holdings of securities have been obtained from ‎your Intermediary in accordance with applicable securities regulatory requirements. By choosing to send the ‎Documents to you directly, the Company (and not your Intermediary) has assumed responsibility for: (i) ‎delivering the Documents to you; and

(ii) executing your proper voting instructions. Non-registered ‎Shareholders who have elected to receive the Documents by electronic delivery (“e-Delivery”) will have ‎received e-mail notification from the Intermediary that the Documents are available electronically on the ‎Company’s website. Please return your voting instructions as specified in the request for voting instructions.‎

‎What is included in the proxy materials?

The proxy materials include:‎

The information in this proxy statement relates to the proposals to be voted on at the Meeting, the voting ‎process, our Board and Board committees, corporate governance, the compensation of our directors and ‎executive officers and other required information.‎

If you share an address with another shareholder, you may receive only one set of proxy materials unless ‎you have provided contrary instructions. If you wish to receive a separate set of the materials, please request ‎the additional copy by contacting our Corporate Secretary at legal@charlottesweb.com or by calling us at (720) 484-8930.‎

A separate set of the materials will be sent promptly following receipt of your request.‎

If you are a shareholder of record and wish to receive a separate set of proxy materials in the future, or if you ‎have received multiple sets of proxy materials and would like to receive only one set in the future, please ‎contact Broadridge at:‎

Broadridge

51 Mercedes Way

Edgewood, NY 11717

1-866-540-7095‎

If you are a Non-registered Shareholder and you wish to receive a separate set of proxy materials in the future, ‎or if you have received multiple sets of proxy materials and would like to receive only one set in the future, ‎please contact your bank or broker directly.‎

Shareholders also may write to, or email us, at the address below to request a separate copy of the ‎proxy materials:‎

Charlotte’s Web Holdings, Inc.

Attn: Corporate Secretary

1801 California Street, Suite 4800

Denver, CO 80202

legal@charlottesweb.com

Note that in light of continued restrictions and orders imposed in connection with the novel coronavirus ‎‎(“COVID-19”), you should allow more time for receipt and processing of physical mail than under normal ‎circumstances.‎

The Company will bear the cost of solicitation, including the cost of preparing, printing and mailing the materials in connection with the solicitation of proxies. This solicitation of proxies is being made to shareholders by mail but may ‎be supplemented by telephone or other personal contact. The Company’s officers and regular employees, on behalf of the Company without being additionally compensated, may solicit proxies personally and by mail, telephone, facsimile or electronic communication at nominal cost to the Company.‎

The Company will not reimburse Intermediaries such as brokerage houses and other custodians, nominees and fiduciaries for forwarding proxy ‎materials to Non-registered Shareholders.‎

The business items to be voted on at the Meeting are:‎

You may vote “FOR” or “AGAINST” the setting of the number of directors at five; “FOR” or “WITHHOLD” the ‎election of nominees for election as directors; and “FOR” or “WITHHOLD” ‎the appointment of Ernst & Young LLP, as auditors for the ensuing year and the authorization of the Board to fix the ‎auditor’s remuneration.‎

Our Board recommends that you vote your shares “FOR” the setting of the number of directors at five, “FOR” ‎each of its nominees for election to the Board, and “FOR” the appointment of Ernst & Young LLP, as ‎auditors for the ensuing year and the authorization of the Board to fix the auditor’s remuneration.‎

To conduct business at the Meeting, the quorum of shareholders is at least two persons who are, or who represent by ‎proxy, shareholders who, in the aggregate, hold at least 25% of the issued shares entitled to be voted ‎at the Meeting.‎

If you indicate “WITHHOLD” in respect to the election of directors, your vote will be counted for purposes of ‎determining the presence or absence of a quorum for the transaction of business at the Meeting. As described ‎below, broker non-votes will be counted for determining the presence or absence of a quorum for the transaction ‎of business at the Meeting, but will not be considered votes cast with respect to the election of any director ‎nominee or on any other proposal.‎

As of the date of this proxy statement, management of the Company knows of no such amendments, variations ‎or other matters to come before the Meeting. However, if other matters properly come before the Meeting, it is ‎the intention of the persons named in the enclosed Proxy Instrument to vote such proxy according to their best ‎judgment.‎

We expect to announce preliminary voting results at the Meeting and to publish final results in a current report ‎on Form 8-K that we will file with the SEC and in a report of voting results in accordance with National Instrument 51-102 – Continuous Disclosure Obligations that we will file in Canada on SEDAR ‎promptly following the Meeting. Both the Form 8-K and report on voting results will also be available on the “Investor Relations” ‎section of our website at www.investors.charlottesweb.com.‎

You are entitled to vote all shares owned by you on the Record Date, including (1) shares held directly in your ‎name as the shareholder of record and (2) shares held for you as the beneficial owner through a bank, broker ‎or other nominee. As of the Record Date, there were (i) 108 shareholders of record holding 145,150,852 outstanding ‎Common Shares; and (ii) nil shareholders of record holding nil outstanding PVS.‎

REGISTERED SHAREHOLDERS HAVE THE RIGHT TO APPOINT A PERSON TO REPRESENT HIM, ‎HER OR IT AT THE MEETING OTHER THAN THE PERSON(S) DESIGNATED IN THE PROXY ‎INSTRUMENT either by striking out the names of the persons designated in the Proxy Instrument and by ‎inserting the name of the person or company to be appointed in the space provided in the Proxy Instrument or by ‎completing another proper form of proxy and, in either case, delivering the completed proxy to Broadridge by ‎mail using the enclosed return envelope to Attention: Vote Processing c/o Broadridge, 51 Mercedes Way, Edgewood, NY ‎‎11717. Alternatively, you may vote by Internet at www.proxyvote.com or by calling 1-800-‎‎690-6903.‎

Most of our shareholders hold their shares through an Intermediary such as a bank, broker or other nominee rather than having the ‎shares registered directly in their own name. Summarized below are some distinctions between shares held of ‎record and those owned beneficially.‎

If your shares are registered directly in your name with our transfer agent, Odyssey Trust Company, you are the ‎shareholder of record of the shares. As the shareholder of record, you have the right to grant a proxy to vote your ‎shares to representatives from the Company or to another person, or to vote your shares electronically at the ‎Meeting. Shareholders of record will receive paper copies of a Notice of Internet Availability of Proxy Materials containing instructions on how to access and review proxy materials as well as directions on how to vote by proxy.

If your shares are held through a bank, broker or other nominee, it is likely that they are registered in the name of ‎the nominee and you are the beneficial owner of shares held in street name.‎

As the beneficial owner of shares held for your account, you have the right to direct the registered holder to vote ‎your shares as you instruct, and you also are invited to attend the Meeting. Your bank, broker, plan trustee or ‎other nominee has provided a voting instruction card, or otherwise provided voting instructions, for you to use in directing how your shares are to be voted.‎

The Meeting will be held entirely online to allow greater participation. Shareholders may participate in the ‎Meeting by visiting the following website: http://www.virtualshareholdermeeting.com/CWEB2022. To participate in ‎the Meeting, you will need the 16-digit control number included on your Notice of Internet Availability of Proxy Materials, on your form of proxy or on the ‎instructions that accompanied your proxy materials. Shares held in your name as the shareholder of record may ‎be voted electronically during the Meeting. Shares for which you are the beneficial owner may be voted electronically during the Meeting if you hold a valid proxy to vote at the Meeting.‎

Even if you plan to attend the Meeting, we recommend that you also submit your proxy or voting instructions ‎as described below, so that your vote will be counted if you later decide not to attend.‎

Whether you hold your shares as a shareholder of record or as a beneficial owner, you may direct how your ‎shares are to be voted without attending the Meeting or any adjournment(s) or postponement(s) thereof. For directions on how to vote, please refer to the following instructions and those included on your proxy or ‎voting instruction card. A proxy form will not be valid unless completed and deposited in accordance with the ‎instructions set out in the proxy form.‎

If ‎you are a registered shareholder, you may vote by submitting a proxy. You may vote over the internet at www.proxyvote.com, by phone at 1-800-690-6903 or by mail by signing, dating and returning the Proxy Instrument to Attention: Vote Processing c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.

If you are a Non-registered Shareholder, you may vote by submitting voting instructions to the registered owner of your shares in accordance with the instructions on your voting instruction card.

This year’s Meeting will be a completely virtual meeting of shareholders, which will be conducted via live ‎webcast. You are entitled to participate in the Meeting only if you were a registered shareholder as of the close of ‎business on April 25, 2022 or if you hold a valid proxy to vote at the Meeting.‎

You will be able to attend the Meeting online and submit your questions during the Meeting by visiting http://www.virtualshareholdermeeting.com/CWEB2022. You will also be able to vote your shares electronically at ‎the Meeting. To participate, you will need your 16-digit control number included in your proxy materials, on ‎your form of proxy, or on the instructions that accompanied your proxy materials.‎

The Meeting will begin promptly at 10:00 a.m., Mountain Time, on June 22, 2022. We encourage you to access the Meeting prior to ‎the start time. Online access will open at 9:45 a.m., Mountain Time, and you should allow ample time to log in to ‎the Meeting webcast and test your computer audio system. Technical assistance will be available if you have ‎difficulty logging into the Meeting via a telephone number that will be posted on the login page to the Meeting.‎

We recommend that you carefully review the procedures needed to gain admission in advance. If you do not ‎comply with the procedures described here for attending the Meeting online, you will not be able to participate ‎online.‎

If you were a shareholder of record as of the close of business on April 25, 2022, or you hold a valid proxy for ‎the Meeting, you may attend the Meeting, vote, and submit a question during the Meeting, by visiting http://www.virtualshareholdermeeting.com/CWEB2022 and using your 16-digit control number to enter the ‎Meeting.

If you are not a shareholder of record but hold shares as a beneficial owner in street name (i.e. a Non-registered Shareholder), you may ‎join the meeting by obtaining a proxy from the owner of record, or you may join the Meeting as a guest. If you join the Meeting as a guest, you will not be able to submit questions or comments, and you will not be able to vote at the Meeting.

If you do not comply with the procedures ‎outlined above, you will not be admitted to the virtual Meeting.‎

Yes, you may register to attend the Meeting as a guest, but you will not be able to submit questions or comments ‎and will not be able to vote at the Meeting without your 16-digit control number.‎

We are excited to embrace virtual meeting technology, which we believe provides expanded access, improved ‎communications and cost and time savings for our shareholders and the Company. A virtual meeting enables ‎increased shareholder attendance and participation from locations around the world. We believe the cost and ‎time savings afforded by a virtual meeting encourages more shareholders to attend the Meeting. In addition, ‎given the potential uncertainties in connection with the current COVID-19 pandemic, including risks related to ‎travel and attending large gatherings, we believe that a virtual-only meeting is the most appropriate format for ‎our shareholders and other Meeting attendees.‎

With your 16-digit control number, you will be able to attend the Meeting online, submit your questions or comments during the Meeting, and vote your shares electronically at the Meeting, ‎by visiting http://www.virtualshareholdermeeting.com/CWEB2022. We encourage you to vote your shares prior to the Meeting to ensure they are ‎represented. Even if you submit a vote prior to the Meeting, registered shareholders or duly appointed proxyholders will have an opportunity to vote again during the ‎Meeting and automatically revoke your earlier vote.‎

We will have technicians ready to assist you with any technical difficulties you may have accessing the virtual ‎Meeting. If you encounter any difficulties accessing the virtual Meeting during check-in or during the meeting, ‎please call the technical support number that will be posted on the virtual Meeting login page ‎‎(http://www.virtualshareholdermeeting.com/CWEB2022).‎

Registered shareholders and duly appointed proxyholders who wish to submit questions or comments may do so during the live webcast of the Meeting at http://www.virtualshareholdermeeting.com/CWEB2022. Instructions will be available on the virtual Meeting site and ‎technical assistance will be available.‎

Shares represented by properly executed proxies in favor of persons designated in the printed portion of the ‎enclosed Proxy Instrument WILL, UNLESS OTHERWISE INDICATED, BE VOTED FOR THE SETTING ‎OF THE NUMBER OF DIRECTORS, FOR THE ELECTION OF DIRECTORS, AND FOR THE APPOINTMENT OF ERNST & YOUNG LLP (“E&Y”), AS THE ‎AUDITORS OF THE COMPANY AND FOR THE AUTHORIZATION OF THE BOARD OF DIRECTORS ‎TO FIX AUDITORS’ REMUNERATION AND TERMS OF ENGAGEMENT. The shares represented by the ‎Proxy Instrument will be voted or withheld from voting in accordance with the instructions of the shareholder on ‎any ballot that may be called for and, if the shareholder specifies a choice with respect to any matter to be acted ‎upon, the shares will be voted accordingly. The enclosed Proxy Instrument confers discretionary authority on the ‎persons named therein with respect to amendments or variations to matters identified in the Notice or other ‎matters which may properly come before the Meeting. As of the date of this proxy statement, management of ‎the Company knows of no such amendments, variations or other matters to come before the Meeting. However, ‎if other matters properly come before the Meeting, it is the intention of the persons named in the enclosed Proxy ‎Instrument to vote such proxy according to their best judgment.‎

If your shares are held through a brokerage firm, they will be voted as you instruct on the voting instruction card ‎provided by your broker. If you sign and return your card without giving specific instructions, your shares will be ‎voted in accordance with the recommendations of our Board.‎

If you do not return your voting instruction card on a timely basis, your broker will have the authority to vote ‎your brokerage shares only on the proposal to ratify our independent registered public accounting firm. Your ‎broker will be prohibited from voting your shares without your instructions on the election of directors and on any ‎other proposal. These “broker non-votes” will be counted only for the purpose of determining whether a quorum ‎is present at the Meeting and not as votes cast. Such broker non-votes will have no effect on the outcome of the ‎matter.‎

Shares that you own as a shareholder of record will be voted as you instruct on your form of proxy. If you sign ‎and return your form of proxy without giving specific instructions, they will be voted in accordance with the ‎procedure set out above under the heading “How will my shares be voted?”‎

If you do not timely return your form of proxy, your shares will not be voted unless you or your proxy holder ‎attends the Meeting via the live webcast and any adjournment(s) or postponement(s) thereof and votes ‎electronically submitted during the Meeting as described above under the heading “How can I vote at the ‎Meeting?”‎

If you hold shares as the shareholder of record, your vote by proxy must be received before 11:59 p.m. ‎‎(Eastern Time) on June 21, 2022 or 48 hours prior to any adjournment(s) or postponement(s) of the Meeting or must be deposited at ‎the Meeting with the chairman of the Meeting before the commencement of the Meeting or any ‎adjournment(s) or postponement(s) thereof.‎

If you hold shares as a beneficial owner, please follow the voting instructions provided by your bank, broker or ‎other nominee.‎

In addition to revocation in any other manner permitted by law, a shareholder who has given a proxy pursuant to this solicitation may revoke it:

For shares you hold as a beneficial owner, you may change your vote by timely submitting new voting ‎instructions to your bank, broker or other nominee (which revokes your earlier instructions), or, if you have ‎obtained a legal proxy from the nominee giving you the right to vote your shares, by attending the Meeting and ‎voting via the live webcast.‎

The Company is subject to the rules of both the SEC under the Securities Exchange Act of 1934, as amended ‎‎(the “Exchange Act”), and provisions of the Business Corporations Act (British Columbia) (“BCBCA”) with ‎respect to shareholder proposals. As clearly indicated under the BCBCA and SEC rules under the Exchange Act, ‎simply submitting a shareholder proposal does not guarantee its inclusion in the proxy materials.‎

Shareholder proposals submitted pursuant to SEC rules under the Exchange Act for inclusion in the Company’s ‎proxy materials for next year’s annual meeting must be received by our Corporate Secretary no later than the ‎close of business (Central time) on December 30, 2022 and must be submitted to our Corporate Secretary at ‎Charlotte’s Web Holdings, Inc., 1801 California Street, Suite 4800, Denver, CO, 80202. Such proposals must also comply with all ‎applicable provisions of Rule 14a-8 under the Exchange Act for inclusion in the Company’s ‎proxy materials for next year’s annual meeting.‎

The BCBCA also sets out the requirements for a valid proposal to be presented at next year’s annual general meeting outside of Rule 14a-8 and provides for the rights and obligations of the ‎Company and the submitter upon a valid proposal being made. Proposals submitted under the applicable ‎provisions of the BCBCA that a shareholder intends to present at next year’s annual meeting and wishes to be considered at next year’s annual general meeting outside of Rule 14a-8 must be received at least three (3) months before the anniversary of the Company’s last annual ‎general meeting (March 22, 2023). Any shareholder proposals must also comply with all applicable provisions of the ‎BCBCA and the regulations thereunder.‎

Proposals that are not timely submitted or are submitted to the incorrect address or other than to the attention ‎of our Corporate Secretary may, at our discretion, be excluded from our proxy materials.‎

See below under the heading “How may I nominate director candidates or present other business for ‎consideration at a meeting?” for a description of the procedures through which shareholders may ‎nominate director candidates for consideration.‎

Shareholders who wish to (1) submit director nominees for consideration or (2) present other items of business ‎directly at next year’s annual meeting must give written notice of their intention to do so, in accordance with the ‎deadlines described below, to our Corporate Secretary at the address set forth below under the heading “How do I ‎obtain additional copies of this proxy statement or voting materials?” Any such notice also must include the ‎information required by our Articles of Incorporation (“articles”) (which may be obtained as provided below ‎under the heading “How may I obtain financial and other information about Charlotte’s Web?”) and ‎must be updated and supplemented as provided in the articles.‎

Subject to compliance with the Company’s articles, written notice of director nominees must be received, in the case of an annual meeting, not less than thirty ‎‎(30) days prior to the date of the annual general meeting of shareholders; provided, however, that in the event that the annual meeting of shareholders is to be held on a date that is less than fifty (50) days after the date (the “Notice Date”) on which the first public announcement of the date of the annual meeting of shareholders was made, ‎notice by the nominating shareholder may be given not later than the close of business on the tenth (10th) day ‎following the Notice Date. If notice-and-access (as defined in National Instrument 54-101 – Communication with Beneficial Owners of Securities of a Reporting Issuer (“NI 54-101”)) is used for delivery of proxy related materials in respect of the meeting, and the notice date in respect of the meeting is not fewer than fifty (50) days prior to the date of the applicable meeting, the notice must be received not later than the close of business on the fortieth (40th) day before the applicable meeting. See “Advance Notice Policy” under “Proposals 1 and 2 - Election of ‎Directors” in this proxy statement.‎

Shareholders may recommend director candidates for consideration by the Board by writing to our ‎Corporate Secretary at the address set forth below under the heading “How do I obtain additional copies of ‎this proxy statement or voting materials?” in accordance with the notice provisions described above under ‎the heading “How may I nominate director candidates or present other business for consideration at a ‎meeting?”‎

Subject to compliance with the Company’s articles, to be in proper written form, such notice must set forth the nominee’s name, age, business and residential ‎address, and principal occupation or employment, his or her direct or indirect beneficial ‎ownership in, or control or direction over, any class or series of securities of the Company, and such other information on the nominee and the nominating shareholder as set forth in ‎our articles, which may be obtained in accordance with the instructions below under the heading “How may I ‎obtain financial and other information about Charlotte’s Web?”‎

The Company is authorized to issue an unlimited number of Common Shares and an unlimited number of PVS. On April 25, 2022, there were 108 shareholders of record holding 145,150,852 outstanding Common ‎Shares, and no other shares outstanding.

The Common Shares carry one vote per share for all matters coming before shareholders at the Meeting ‎and the PVS carry 400 votes per share for all matters coming before ‎shareholders at the Meeting.‎

The holders of Common Shares and PVS are entitled to receive notice of any ‎meeting of shareholders of the Company, and to attend and vote at those meetings, except those ‎meetings at which holders of a specific class of shares are entitled to vote separately as a class under ‎the BCBCA.‎

To the knowledge of the Company, as at the Record Date, no person or company owns of record, or ‎owns beneficially, or controls or directs, directly or indirectly, more than ten percent (10%) of the voting rights attached ‎to the voting shares.‎

The Company is using the “Notice-and-Access” provisions of applicable securities laws under Rule 14a-16 under ‎the Exchange Act, National Instrument 51-102 – Continuous Disclosure Obligations (“NI 51-102”) and NI 54-101. Under notice-and-access, companies may post electronic versions of such materials on a ‎website for investor access and review and will make such documents available in hard copy upon request at no ‎cost. Notice-and-access substantially reduces the Company’s printing and mailing costs and is environmentally ‎friendly as it reduces paper and energy consumption.

This proxy statement, the Annual Report on Form 10-K for ‎the fiscal year ended December 31, 2021 (which includes the audited annual consolidated financial statements of the Company for the year ended December 31, 2021, together with the notes thereto, and the independent auditor’s report ‎thereon, and the related management’s discussion and analysis), and the form of proxy are available on the “Investor Relations” section of our ‎website at www.investors.charlottesweb.com, on SEDAR at www.sedar.com and the SEC’s website at www.sec.gov. The Company ‎has elected not to use the procedure known as “stratification” in relation to its use of the “notice-and-access” ‎rules.‎ Stratification occurs when an issuer using notice-and-access sends a paper copy of the proxy statement to some shareholders with a notice package.

Shareholders are reminded to review this proxy statement before voting. Shareholders will receive paper copies of a Notice of Internet Availability of Proxy Materials containing instructions on how to access and review proxy materials as well as directions on how to vote by proxy.

Shareholders with questions about notice-and-access can call the Company at 1(720) 484-8930 or email legal@charlottesweb.com‎.

Except as described elsewhere in this proxy statement, management of the Company is not aware of any material interest, direct or indirect, by way of beneficial ownership of securities or otherwise, of (a) any director or executive officer of the Company, (b) any proposed nominee for election as a director of the Company, and (c) any associates or affiliates of any of the persons or companies listed in (a) and (b), in any matter to be acted on at the Meeting.

Our audited annual consolidated financial statements for the year ended December 31, 2021 are included in our Annual Report on Form 10-K. We filed our Annual ‎Report on Form 10-K with the SEC on March 24, 2022 and concurrently filed the Annual Report on Form 10-K on SEDAR at www.sedar.com. We will furnish a copy of our Annual Report on Form ‎‎10-K (excluding exhibits, except those that are specifically requested) without charge to any shareholder who ‎so requests by writing to our Corporate Secretary at the address below under the heading in “How do I obtain ‎additional copies of this proxy statement or voting materials?” The Annual Report on Form 10-K is also ‎available free of charge on the “Investor Relations” section of our website at www.investors.charlottesweb.com, on the SEC’s website at ‎www.sec.gov, and on SEDAR at www.sedar.com.‎

By writing to us, shareholders also may obtain, without charge, a copy of our articles, code of conduct and Board ‎standing committee charters.‎

If you are a shareholder of record and have questions concerning share certificates, ownership transfer or ‎other matters relating to your share account, please contact our transfer agent at the following address:‎

Odyssey Trust Company‎

350 - 409 Granville Street

Vancouver, BC V6C 1T2‎

If you need additional copies of this proxy statement or the proxy materials, please contact us at:‎

Charlotte’s Web Holdings, Inc.

Attn: Corporate Secretary

1801 California Street, Suite 4800

Denver, CO 80202

legal@charlottesweb.com

Proposals 1, 2, and 3 are included in this proxy statement at the direction of our Board. Our Board ‎unanimously recommends that you vote “FOR” the setting of the number of directors at five and the election ‎of the nominees in Proposals 1 and 2, and “FOR” the appointment and ‎remuneration of auditors in Proposal 3.‎

There are currently five directors of the Company. At the Meeting, it is proposed to fix the number of directors ‎at five and that five directors are to be elected at the Meeting.‎

Management proposes to nominate at the Meeting each of John Held, Jacques Tortoroli, Jean Birch, Susan Vogt and Tim Saunders, each to serve as a director of the ‎Company until the next Meeting at which the election of directors is considered, or until his/her successor is duly ‎elected or appointed, unless he/she resigns, is removed or becomes disqualified in accordance with the articles of ‎the Company or the BCBCA. The persons named in the accompanying Proxy Instrument intend to vote for the ‎election of such persons at the Meeting, unless otherwise directed. Management does not contemplate that any ‎of the nominees will be unable to serve as a director of the Company.

The following table and the notes thereto set out the name and age of each current director and director ‎nominee (as of April 28, 2022) their respective positions and, if applicable, the period during which he/she has ‎been a director of the Company.‎

The biographies of the proposed nominees for the Board are set out below.‎

Mr. Held first joined the Company’s Board on May 18, 2018 and has served as Board Chair since September 2020. Mr. Held is Chair of the Corporate Governance and Nominating Committee and is a member of the Compensation Committee of the Board. Mr. Held has served as General Counsel and Corporate Secretary of Omega Protein Company, a nutritional specialty oils and proteins products company, since 2006, and has served as General Counsel since 2000. In 2014, Mr. Held founded the Byzantium Group, a private security and investigations company, where he served as Board Chair. Prior to working with Omega Protein Company, Mr. Held was General Counsel at American Residential Services, Inc., and also practiced corporate and securities law with a large international law firm. Since April 2021, Mr. Held has served on the Board of Directors of Ajna BioSciences, a botanical drug development company. Mr. Held holds a bachelor’s degree in Economics and International Relations from Bucknell University and a Juris Doctorate from Cornell Law School.

Mr. Tortoroli joined the Company’s Board of Directors on November 14, 2019 and became CEO on December 16, 2021. From November 2014 to September 2020, Mr. Tortoroli served as the President of Bacardi International Limited and Chief Financial Officer and Chief Administrative Officer at Bacardi Ltd, the world’s largest privately-held spirits company, where he was responsible for the company’s finance, strategy, operations, e-commerce, data insights, and global supply chain. In October 2019, Mr. Tortoroli was named the Executive in

Residence and Vice President of Institutional Advancement and Student Career Services at St. Thomas Aquinas College. Since 2021, Mr. Tortoroli has served as a member of the Board of Directors of Ajna BioSciences, a botanical drug development company. He is also Chair of the Board and Advisor to the Chief Executive Officer of Gameday Gateway, a certified Women’s Business Enterprise. Mr. Tortoroli holds a bachelor’s degree in Accounting from St. Francis College in Brooklyn, New York, and he is a CPA.

Ms. Birch joined the Company’s Board on July 10, 2020. Since July 2020, Ms. Birch has served as the Chair of the Company’s Compensation Committee and a member of the Audit Committee. Since 2007, Ms. Birch has served as Chief Executive Officer and President of her own strategy and leadership consulting practice, Birch Company, LLC. In July 2021, Ms. Birch was named as Lead Director at NextPoint Financial Inc., a TSX-listed company, where she also chairs the Nomination and Governance Committee and is a member of the Compensation Committee. Since February 2018, she’s been a director of Forrester Research, Inc., a Nasdaq-listed global research and advisory firm, where she currently serves as Chair of that Board’s Audit Committee. Ms. Birch has previously served as a director of CorePoint Lodging, Inc. from September 2018 until March 2022. Ms. Birch was a director of Jack in the Box from June 2019 through February 2021. Ms. Birch served as a member of the Board of Papa Murphy’s Holdings, Inc. from April 2015 until May 2019, and served as Chair of the Board of Papa Murphy’s from September 2016 until May 23, 2019, when the company was sold to MTY Food Group. Ms. Birch was appointed President and CEO of Papa Murphy’s in December 2016 and served in that position until July 2017. Ms. Birch holds a bachelor’s degree in Economics and Oriental Studies from the University of Arizona and an M.B.A. from Southern Methodist University.

Ms. Vogt has been a director of the Company since September 3, 2020. Ms. Vogt is a member of the Audit Committee, the Compensation Committee, and the Corporate Governance and Nominating Committee. Since September 2019, Ms. Vogt has served on the Board of Directors of Sharps Compliance Corp, a publicly-held Nasdaq-listed medical waste management company, where she serves on the Governance Committee and as Chair of the Audit Committee. In October 2018, Ms. Vogt joined the Board of Anika Therapeutics Inc., a Nasdaq-listed company, where she currently serves as Chair of the Governance and Nominating Committee and as a designated audit committee financial expert member of its Audit Committee. Ms. Vogt previously served as President and Chief Executive Officer of Aushon Biosystems, Inc., a developer of a multiplex immunoassay platform from 2013 until the company was acquired by Quanterix Corporation in January 2018. Ms. Vogt received her M.B.A. from Boston University with a concentration in Finance and her bachelor’s degree from Brown University in Art History.

Mr. Saunders joined the Board on June 18, 2021. Mr. Saunders is Chair of the Audit Committee and a member of the Corporate Governance and Nominating Committee. From January 2020 to April 2021, Mr. Saunders was Chief Financial Officer of Collective Growth Corporation, a special purpose acquisition company listed on Nasdaq, which he helped steer to a merger with Innoviz Technologies Ltd., which closed in April 2021. From 2015 until his retirement in May 2019, Mr. Saunders served as Chief Financial Officer of Canopy Growth Corporation from its entrepreneurial beginning through its listings on both the Toronto Stock Exchange and the New York Stock Exchange, both firsts in the Cannabis sector. Prior to Canopy, Mr. Saunders held financial executive and leadership roles across a number of sectors including mobile, telecom, semiconductors, manufacturing, and clean tech. Mr. Saunders has served on the Ottawa Hospital Foundation Board of Directors as a Director and Audit Committee Chair since June 2019. Finally, Mr. Saunders has also served on the Elmwood School Board of Directors and Finance Committee since January 2018. Mr. Saunders is recognized with the distinction as a Fellow Chartered Public Accountant, Fellow Chartered Accountant (FCPA, FCA) by the Chartered Professional Accountants of Canada and is a graduate of Bishop’s University where he obtained his bachelor’s degree in Business Administration. He also earned an executive certificate from the Ivey School of Business at Western University (Ontario) and possesses the ICD.D designation awarded by the Institute of Corporate Directors.

The persons named in the accompanying Proxy Instrument (if named and absent contrary directions) ‎intend to vote the shares represented thereby FOR (i) setting the number of directors at five and (ii) the ‎election of each of the aforementioned named nominees unless otherwise instructed on a properly executed ‎and validly deposited proxy. Management of the Company does not contemplate that any nominees named ‎above will be unable to serve as a director, but, if that should occur for any reason prior to the Meeting, the ‎persons named in the enclosed form of proxy reserve the right to vote for another nominee at their discretion.‎

‎The Board has adopted a “majority voting” policy (the “Majority Voting Policy”). Pursuant to the Majority Voting Policy, if a nominee for election as director receives “for” votes fewer than a majority of the votes ‎‎(50% + 1 vote) cast with respect to his or her election by shareholders, he or she must immediately tender his or ‎her resignation to the Board following the meeting of shareholders at which the election is held. Upon receiving ‎such resignation, the CG&N Committee will consider it ‎and make a recommendation to the Board on whether or not to accept the resignation. The Board shall accept ‎the resignation unless it determines that the applicable director shall continue and announce its decision in a ‎press release promptly within 90 days following the meeting of shareholders. If the Board determines not to ‎accept a resignation, the press release must fully state the reasons for that decision. The resignation will be ‎effective when accepted by the Board. The director who tendered his or her resignation is not permitted to be a ‎part of any deliberations of the CG&N Committee or of the Board pertaining to the resignation offer. The policy ‎only applies in circumstances involving an uncontested election of directors.‎

To the extent directors are elected or appointed to fill casual vacancies or vacancies arising from the resignation ‎or removal of directors, in both instances whether by shareholders or directors, the directors shall hold office until the ‎remainder of the unexpired portion of the term of the departed director that was replaced.‎

Our articles include advance notice provisions for the nomination for election of directors (the “Advance Notice ‎Policy”). The Advance Notice Policy provides that any shareholder seeking to nominate a candidate for election ‎as a director (a “Nominating Shareholder”) at any annual meeting of the shareholders, or at any special ‎meeting of shareholders if one of the purposes for which the special meeting was called was the election of ‎directors, must give timely notice thereof in proper written form to our Corporate Secretary.‎

To be timely, a Nominating Shareholder’s notice must be given, (i) in the case of an annual meeting, not less than thirty ‎‎(30) days prior to the date of the annual general meeting of shareholders; provided, however, that in the event that the annual meeting of shareholders is to be held on a date that is less than fifty (50) days after the date (the “Notice Date”) on which the first public announcement of the date of the annual meeting of shareholders was made, ‎notice by the nominating shareholder may be given not later than the close of business on the tenth (10th) day ‎following the Notice Date; (ii) in the case of any other general meeting of shareholders called for the purpose of electing directors (whether or not also called for other purposes), not later than the close of business on the fifteenth (15th) day following the day on which the first public announcement of the date of the general meeting of shareholders was made; and (iii) if notice-and-access (as defined in National Instrument 54-101 – Communication with Beneficial Owners of Securities of a Reporting Issuer) is used for delivery of proxy related materials in respect of the meeting, and the notice date in respect of the meeting is not fewer than fifty (50) days prior to the date of the applicable meeting, the notice must be received not later than the close of business on the fortieth (40th) day before the applicable meeting. The articles also prescribe the proper written form for a ‎Nominating Shareholder’s notice.‎

The chair of the meeting shall have the power and duty to determine whether a nomination was made in ‎accordance with the notice procedures set forth in the articles and, if any proposed nomination is not in ‎compliance with such provisions, the discretion to declare that such defective nomination will be disregarded.‎

Notwithstanding the foregoing, the Board may, in its sole discretion, waive any requirement in the Advance ‎Notice Policy.‎

To the best of the Company’s knowledge, no proposed director is, as at April 28, 2022, or has been within the 10 years before April 28, 2022, a director or executive officer of any company (including Charlotte’s Web), that:

Except as described below, no proposed director is, as at April 28, 2022, or has been within 10 years before April 28, 2022, a director or executive officer of any company (including Charlotte’s Web) that, while the proposed director was acting in that capacity, or within a year of the proposed director ceasing to act in that capacity, became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold its assets.

Jean Birch was a director of Cosi, Inc. prior to and through its Chapter 11 bankruptcy process in 2016. Cosi, Inc. subsequently emerged as a reorganized private company.

No proposed director has, within 10 years before April 28, 2022, become bankrupt, made a proposal under ‎any legislation relating to bankruptcy or insolvency, or become subject to or instituted any proceedings, ‎arrangement or compromise with creditors, or had a receiver, receiver manager or trustee appointed to hold the ‎assets of such proposed director.‎

To the best of the Company’s knowledge, no proposed director has, as at April 28, 2022, been subject to (a) any penalties or sanctions imposed by a court relating to securities legislation or by a securities regulatory authority or has entered into a settlement agreement with a securities regulatory authority; or (b) any other penalties or sanctions imposed by a court or regulatory body that would likely be considered important to a reasonable securityholder in deciding whether to vote for a proposed director, other than a settlement agreement entered into before December 31, 2000 that would likely not be important to a reasonable securityholder in deciding whether to vote for a proposed director.

A related party transaction includes any transaction or proposed transaction in which:

Related parties include any person who is or was (since the beginning of the last fiscal year, even if such person does not presently serve in that role) an executive officer or director of the Company, any shareholder beneficially owning more than 5% of any class of the Company’s voting securities or an immediate family member of any such persons.

The Audit Committee is charged with oversight over related party transactions entered into by the Company.

In addition to the compensation arrangements discussed under “Executive Compensation” below, ‎since January 1, 2021, the Company has entered into the following Related Party Transactions:‎

On August 1, 2018, the Company entered into the Name and Likeness Agreement with Leeland & Sig d/b/a Stanley Brothers Brand Company, a Colorado limited liability company owned by certain of the Company’s founders, including each of the seven Stanley brothers (together, the “Stanley Brothers”). Per the Name and Likeness Agreement, Leeland & Sig d/b/a Stanley Brothers Brand Company grants the Company a non-exclusive right to use the name, together with renderings of each Brother’s voice, image, and likeness, and all attributes of each Brother’s personality and appearance including any right of publicity, in connection with creation, development, manufacturing, operation, promotion, distribution, and sales of products under the Company on a royalty-free basis, subject to the terms of the Name and Likeness Agreement. Each party to the Name and Likeness Agreement will have the right to cause the other party to cease use of the name in certain circumstances such as misuse, bad acts, or a corporate acquisition. Under the Name and Likeness Agreement, the Company also agreed to seek B Corporation status (subject to the Board’s review in the exercise of its fiduciary duties). The initial term of the Name and Likeness Agreement was for a thirty-six (36) month period, with the Company agreeing to begin activities to cease all use of any intellectual property used under the Name and Likeness Agreement within thirty (30) days of expiration or termination. In connection with the Company’s execution of the Name and Likeness Agreement and as discussed below, the Company executed employment agreements with each of the Stanley Brothers on September 1, 2018

providing for aggregate annual base salaries to the Stanley Brothers of $1,425,000. The foregoing description is qualified in its entirety by reference to the Name and Likeness Agreement, included as Exhibit 10.1 to our Annual Report on Form 10-K. As further discussed below, the Name and Likeness Agreement was amended and extended on April 16, 2021.

Effective November 13, 2020, the Company entered into a secured promissory note with Jesse Stanley and Master and A Hound Irrevocable Trust, as borrowers, where $1,000,000 was loaned to Jesse Stanley, one of the Company’s founders. The promissory note matured on November 13, 2021, and carries an interest rate equivalent to the Prime Rate (as defined in the promissory note) calculated and accruing monthly in arrears on the last day of each month commencing on November 30, 2020. Interest under the note accrues both before and after demand, default and judgment and until payment. Interest on any overdue amounts payable under the note bears interest at a rate equivalent to the Prime Rate plus 2%. On March 22, 2022, the Company, Jesse Stanley and Master and A Hound Irrevocable Trust entered into a waiver and first amendment to the secured promissory note, which provided for a waiver of existing defaults, an amendment to the maturity date of the promissory note to November 13, 2023 and the addition of additional security. According to the terms of the waiver and first amendment to the secured promissory note, no additional interest will accrue through the payment date. As of April 28, 2022, this promissory note remains outstanding. The foregoing description is qualified in its entirety by reference to the promissory note included as Exhibit 10.30 and the waiver and first amendment to the secured promissory note included as Exhibit 10.36 to our Annual Report on Form 10-K.

On March 2, 2021, the Company entered into the option purchase agreement (the “SBH Purchase Option”) with Stanley Brothers USA Holdings, Inc. (“Stanley Brothers USA”), a Delaware corporation whose majority shareholders are certain founders of the Company or entities controlled by such founders or their affiliates. The SBH Purchase Option was purchased for total consideration of $8,000,000 and has a five-year term (extendable for an additional two years upon payment of additional consideration). The agreement provides Charlotte’s Web the option to acquire all or substantially all of Stanley Brothers USA on the earlier of February 26, 2024, and federal legalization of Cannabis in the United States, or such earlier time as Stanley Brothers USA and Charlotte’s Web may agree, at a purchase price to be determined at the time of exercise of the SBH Purchase Option. CW is not obligated to exercise the SBH Purchase Option. As consideration for entering into the agreement and payment of the $8,000,000 consideration, Stanley Brothers USA issued a warrant to the Company for the purchase of 10% of the outstanding shares of Stanley Brothers USA on a partially-diluted basis, including convertible securities that are considered in-the-money, subject to certain conditions and exclusions, at an exercise price of $0.001 per share. This warrant can only be exercised should the Company choose to forgo its right to exercise the SBH Purchase Option, and if executed would amount to a nominal exercise price for the Company. The foregoing description is qualified in its entirety by reference to the SBH Purchase Option included as Exhibit 10.3 to our Annual Report on Form 10-K.

On April 16, 2021, pursuant to an amending agreement, the August 1, 2018 Name and Likeness and Agreement between the Company and Leeland & Sig LLC d/b/a Stanley Brothers Brand Company was extended for a period of one year, expiring July 31, 2022. In addition, the Company executed a consulting agreement which extended the service arrangements of the seven Stanley Brothers for a period of one year, expiring July 31, 2022. Upon execution of the consulting agreement, the Company paid $2,081,250 to Leeland & Sig LLC d/b/a Stanley Brothers Brand Company, on behalf of the Stanley Brothers, as consideration for the consulting services to be provided to the Company over the term of the agreement and certain restrictive covenants. The foregoing descriptions are qualified in their entirety by reference to the amending agreement to the Name and Likeness Agreement and the consulting agreement included as Exhibit 10.2 and 10.29, respectively to our Annual Report on Form 10-K.

As discussed under “Executive Compensation – Employment Agreements,” Jacques Tortoroli, Wessel Booysen, Adrienne Elsner, Tony True, and Russell Hammer are parties to employment agreements with the Company.

Each of the Stanley Brothers, J. Austin Stanley, Jared Stanley, Jesse Stanley, Joel Stanley, Jonathan Stanley, Jordan Stanley, and Josh Stanley, may be considered a promoter of the Company.

We are not currently subject to listing requirements of any national securities exchange that has requirements that a majority of the board of directors be “independent.” The independence of the Company’s directors has been determined ‎under the corporate governance rules of Nasdaq. The independence rules of Nasdaq include a series of

objective tests, including that ‎an “independent” person will not be employed by the Company and will not be engaged in various types of business dealings with ‎the Company. In addition, the Board is required to make a subjective determination as to each person that no material relationship ‎exists with the Company either directly or as a partner, shareholder or officer of an organization that has a relationship with the ‎Company. It has been determined by the Board of Directors that four of the Company’s directors are independent persons under the ‎independence rules of Nasdaq: Jean Birch, John Held, Tim Saunders, and Susan Vogt.‎

In accordance ‎with National ‎Instrument 52-110 - Audit Committees, or NI 52-110, each of Jean Birch, John Held, Tim Saunders and Susan Vogt are considered to be independent. Under NI 52-110, an independent director is ‎one who is ‎free from any direct or indirect relationship which could, in the view of the board of directors, be ‎reasonably ‎expected to interfere with such director’s exercise of independent judgment.

Pursuant to the BCBCA, directors and officers are required to act honestly and in good faith with a view to the ‎best interests of the Company. Under the BCBCA, subject to certain limited exceptions, a director who holds a ‎disclosable interest in a material contract or transaction into which we have entered or propose to enter is ‎not entitled to vote on any directors’ resolution to approve the contract or transaction. In accordance with the BCBCA, a director or officer has a ‎disclosable interest in a material contract or transaction if, among other factors, the director or officer has a material interest in the contract or transaction or the director or officer is a director or senior officer of, or has a material interest in, a person who has a material interest in the contract or transaction.‎

Generally, as a matter of practice, directors or officers who have disclosed a material interest in any contract ‎or transaction that the Board is considering will not take part in any Board discussion respecting that contract ‎or transaction. If such directors were to participate in the discussions, they would abstain from voting on any ‎matters relating to matters in which they have disclosed a disclosable interest.‎

OUR BOARD UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” THE SETTING OF THE ‎NUMBER OF DIRECTORS AT FIVE AND “FOR” THE ELECTION OF THE NOMINEES IN ‎PROPOSALS 1 AND 2.‎

The members of the audit committee of our Board, or the Audit Committee and our Board believe the continued ‎retention of Ernst & Young‎ LLP (“Ernst & Young”) as our independent registered accounting firm is in the best interests of the Company and ‎our shareholders. Ratification requires the receipt of “FOR” votes constituting a majority of the shares cast by the ‎shareholders who vote in respect of this proposal. Representatives of Ernst & Young are expected to attend the Meeting.‎

Ernst & Young ‎has served as our independent registered public accounting firm since September 7, 2019. The engagement of Ernst & Young‎ was ‎approved by the Audit Committee and the Board. Ernst & Young completed an audit of the Company’s financial ‎statements for the year ended December 31, 2021.‎ A representative of Ernst & Young will be present at the Meeting, will be given the opportunity to make a statement if he or she so desires and will be available to respond to appropriate questions.

Aggregate fees billed by our independent auditors, Ernst & Young, for the years ended December 31, 2021 and ‎December 31, 2020 are detailed in the table below.‎

Audit fees. Audit fees consist of fees and related expenses billed for professional services rendered for the audit ‎of the financial statements and services that are normally provided by our independent registered public ‎accounting firm in connection with statutory and regulatory filings or engagements and include fees for ‎professional services rendered in connection with the annual reports.‎

Audit fees also consist of fees and related expenses billed for professional services rendered ‎for the review of the quarterly financial statements and services that are normally provided by our independent ‎registered public accounting firm in connection with statutory and regulatory filings or engagements and include ‎fees for professional services rendered in connection with the quarterly reports. Finally, audit fees include fees and related expenses associated with the issuance of consents by our ‎independent registered public accounting firm to be named in our prospectuses and/or registration statements ‎and to the use of their audit report in the prospectuses and/or registration statements.‎

Audit-related fees. Audit-related fees consist of fees and related expenses billed for assurance and related services (e.g., due diligence services) that traditionally are performed by the independent accountant more specifically, these services would include, among others: employee benefit plan audits, due diligence related to mergers and acquisitions, and internal control reviews.

Tax fees. Tax fees consists of fees for services related to tax compliance and tax due ‎diligence.

The Audit Committee has not adopted specific policies and procedures for the engagement of non-audit services. The Audit Committee must pre-approve any non-audit services to the Company and the fees for those services.

Our Audit Committee has determined that the provision of the services as set out above is compatible with ‎the maintaining of Ernst & Young’s independence in the conduct of their auditing functions.

The material in this report is not “soliciting material,” is not deemed “filed” with the SEC, and is not to be ‎incorporated by reference into any filing by Charlotte’s Web Holdings, Inc. under the Securities Act of 1933, as ‎amended, or the Exchange Act.‎

The primary purpose of the Audit Committee is to assist the Company’s Board in fulfilling its responsibilities for ‎oversight of financial, audit and accounting matters. The Audit Committee reviews the financial reports and ‎other financial information provided by the Company to regulatory authorities and its shareholders, as well as ‎reviews the Company’s system of internal controls regarding finance and accounting, including auditing, ‎accounting and financial reporting processes.‎

The Audit Committee has reviewed and discussed the audited financial statements for the year ended December 31, 2021 with management. The Audit Committee has also discussed with Ernst & Young, the ‎Company’s independent registered public accounting firm, the matters required to be discussed under applicable ‎auditing standards, including Auditing Standard No. 1301. In addition, the Audit Committee discussed with Ernst & Young ‎its independence, and received from Ernst & Young the written disclosures and the letter required by applicable ‎requirements of the Public Company Accounting Oversight Board. Finally, the Audit Committee discussed with Ernst & Young, with and without management present, the scope and results of Ernst & Young’s audit of such financial statements.‎

Based on these reviews and discussions, the Audit Committee recommended to the Board that such ‎audited financial statements be included in the Company’s Annual Report on Form 10-K for the year ‎ended December 31, 2021.‎

Audit Committee of the Board

Tim Saunders (Chair)‎

Jean Birch

Susan Vogt

OUR BOARD UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” THE APPOINTMENT ‎AND REMUNERATION OF OUR AUDITORS IN PROPOSAL 3.‎

The following table sets forth the expected beneficial ownership of the Company’s Common Shares as of April 28, 2022 for (i) each member of the Board of Directors, (ii) each named executive officer (as defined below) for the year ended December 31, 2021, (iii) each person known to the Company to be the beneficial owner of more than 5% of the Company’s securities, and (iv) the members of the Board and the executive officers of the Company as a group.‎

The board of ‎directors currently consists of five (5) directors. Each director holds office until the close of the next annual general meeting of shareholders, or ‎until his or her successor is duly elected or appointed, unless his or her office is earlier vacated. The board of directors may establish one or more ‎committees of the board of directors, however designated, and delegate to any such committee the full power ‎of the board of directors, to the fullest extent permitted by law.‎

We are not currently subject to listing requirements of any national securities exchange that has requirements that a majority of the board of directors be “independent.” The independence of the Company’s directors has been determined ‎under the corporate governance rules of Nasdaq. The independence rules of Nasdaq include a series of objective tests, including that ‎an “independent” person will not be employed by the Company and will not be engaged in various types of business dealings with ‎the Company. In addition, the Board is required to make a subjective determination as to each person that no material relationship ‎exists with the Company either directly or as a partner, shareholder or officer of an organization that has a relationship with the ‎Company. It has been determined by the Board of Directors that four of the Company’s directors are independent persons under the ‎independence rules of Nasdaq: Jean Birch, John Held, Tim Saunders, and Susan Vogt.‎ Jacques Tortoroli is not independent, ‎given that he is our Chief Executive Officer.‎

In accordance ‎with NI 52-110, each of Jean Birch, John Held, Tim Saunders and Susan Vogt are considered to be independent. Under NI 52-110, an independent director is ‎one who is ‎free from any direct or indirect relationship which could, in the view of the board of directors, be ‎reasonably ‎expected to interfere with such director’s exercise of independent judgment.

The board of directors holds regularly scheduled meetings and at such meetings our independent directors meet ‎in executive session.‎

The Board held a total of twelve (12) meetings and took action thirteen (13) times by unanimous consent during the year ended December 31, 2021. During 2021, each of the proposed director nominees attended 100% of the total number of meetings of the Board (held during the period for which he or she was a director). Board members are not required, but are expected to make every effort, to attend the Annual Meeting of stockholders. Other than Tim Saunders who was not a director at the time, all of our directors attended the 2021 annual general meeting of

shareholders.

The Board has adopted a written board mandate. A copy of the board mandate is included as Exhibit I to this proxy statement and is available on our corporate website at: https://investors.charlottesweb.com. The Board has developed a written position description for the Chair of the Board and for the Chair of each of the Audit Committee, the CG&N Committee, and the Compensation Committee. The Board, with the input of the Chief Executive Officer of the Company, has developed a written position description for the Chief Executive Officer.

While the Company does not currently have a formal orientation and education program for new recruits to the Board, the Company has historically provided such orientation and education on an informal basis. As new directors have joined the Board, management has provided these individuals with corporate policies, historical information about the Company, as well as information on the Company's performance and its strategic plan with an outline of the general duties and responsibilities entailed in carrying out their duties. The Board believes that these procedures have proved to be a practical and effective approach in light of the Company's particular circumstances, including the size of the Company, limited turnover of the directors and the experience and expertise of the members of the Board.

No formal continuing education program currently exists for the directors of the Company. The Company encourages directors to attend, enroll or participate in courses and/or seminars dealing with financial literacy, corporate governance and related matters and has agreed to pay the cost of such courses and seminars. Each director of the Company has the responsibility for ensuring that he or she maintains the skill and knowledge necessary to meet his or her obligations as a director.

The Company has not adopted term limits for the directors on its Board. The Board is concerned that imposing arbitrary and inflexible director term limits may result in the Company losing valued directors at a time when the Company most needs their skills, qualities and contributions, as well as their knowledge of the history and culture of the organization. Mandatory retirement ages pose the same risk and the Board does not want to risk the loss of key directors to retirement policies that seem unnecessarily arbitrary and inflexible when they force a high performing director off the Board. As a result, the Board does not feel that it would be appropriate to set term limits for its directors but rather relies on the experience of its members to determine when Board renewals, Board removals and Board additions are appropriate.

The Company does not have a written policy relating to the identification and nomination of women directors. All appointments to the Board are made on merit, in the context of the skills and experience the Board, as a whole, requires to be effective. The CG&N Committee, when considering and recommending qualified director nominees, takes the background and diversity (including gender) of all directors and nominees into consideration.

The CG&N Committee and the Board go through a rigorous process when considering a director nominee, including an evaluation of the skills and experience of the current directors, determining the gaps in skills and experience that exist and finding potential candidates to fill those gaps and round out the skills and experience of the Board as a whole. Diversity (including the representation of women on the Board and in executive officer positions) is a factor considered in determining the optimum composition of the Board. The final recommendation for nomination or appointment to the Board has been based on the best combination of skills and experience for the position, with due regard for the benefits of diversity on the Board.

The Board encourages the consideration of women who have the necessary skills, knowledge, experience and character when considering new potential candidates for executive officer positions.

The Board does not have specific targets in respect of appointing women to the Board and in respect of executive officer appointments, as a result of its commitment to a principle-based selection process, as discussed above. However, the Board does understand and appreciate the importance of gender equality and diversity and is committed to strengthening diversity when recruiting for a Board appointment or executive officer position.

As of April 28, 2022, there are currently two women on the Board (40%) and one executive officer is a women (25%).

We welcome comments and questions from our shareholders. Shareholders can direct communications to the ‎Company at our principal executive offices at 1801 California Street, Suite 4800, Denver, CO 80202, Attention: Corporate Secretary‎.

The Board has three standing committees: (1) the Audit Committee, (2) the Corporate Governance and Nominating Committee and (3) the Compensation Committee. The charters for our committees set forth ‎the scope of the responsibilities of that committee. The board of directors will assess the effectiveness and ‎contribution of each committee on an annual basis. The charters for our committees were adopted by the board ‎of directors in 2018 and were revised most recently in November 2021.

The Audit Committee of the Board assists the Company’s Board in fulfilling its oversight responsibilities relating to financial accounting and reporting process and internal controls for the Company and ensuring the adequacy and effectiveness of the Company’s risk management programs. The Audit Committee reviews the financial reports and other financial information provided by the Company to regulatory authorities and its shareholders, as well as reviews the Company’s system of internal controls regarding finance and accounting, including auditing, accounting and financial reporting processes.

As of the date of this proxy statement, the Audit Committee of the Board is comprised of three (3) members. The following are the members of the Audit Committee:

The Audit Committee held five (5) meetings in 2021. During 2021, each of the members of the Audit Committee attended 100% of the total number of meetings held by the Audit Committee during the periods he or she served.

Each member of the Audit Committee has experience relevant to his or her responsibilities as an Audit Committee member. See “Proposals 1 and 2 –Election of Directors—Biographical Information” for a description of the education and experience of each Audit Committee member.

At no time since the commencement of the Company’s most recently completed financial year were any Audit Committee recommendations to nominate or compensate an external auditor not adopted by the Board of Directors.

The Board has adopted a written charter for the Audit Committee, which sets out the Audit Committee’s responsibilities. The Audit Committee performs a number of roles including (i) assisting directors to meet their oversight responsibilities, (ii) to provide an open avenue of communication among the external auditors, financial and senior management and the Board; (iii) ensuring the independence of the external auditors and review and appraise their performance; (iv) increasing the credibility and objectivity of financial reports; and (v) strengthening the role of the directors by facilitating in-depth discussions among directors, management, and the external auditor. The Audit Committee has been delegated responsibility for, among other matters and as more fully set out in the Audit Committee Charter: (i) the integrity of the Company’s consolidated financial statements and accounting and financial processes and the audits of its consolidated financial statements; (ii) compliance with legal, ethical and regulatory requirements; (iii) the external auditors’ independence and performance review; (iv) the work and performance of financial management and external auditors; and (v) the system of disclosure controls and procedures and system of internal controls regarding finance, accounting, legal compliance and risk management established by management and the Board. The Audit Committee has unrestricted access to all books and records of the Company and may request any information as it may deem appropriate. It also has the authority to retain and compensate special legal, accounting, financial and other consultants or experts in the performance of its duties. A copy of the Audit Committee Charter is available on our corporate website at: https://investors.charlottesweb.com.

The Corporate Governance and Nominating Committee of the Board assists the Board in fulfilling its oversight responsibilities relating to the corporate governance of the Company and the size, structure, and membership of the Board and its committees.

As of the date of this proxy statement, the Corporate Governance and Nominating Committee is comprised of three (3) members. The following are the members of the Corporate Governance and Nominating Committee:

The Corporate Governance and Nominating Committee held seven (7) meetings in 2021. During 2021, each of the members of the Corporate Governance and Nominating Committee attended 100% of the total number of meetings held by the Corporate Governance and Nominating Committee during the periods he or she served.

The Board has adopted a written charter for the Corporate Governance and Nominating Committee, which sets out the Corporate Governance and Nominating Committee’s responsibilities. The Corporate Governance and Nominating Committee has been delegated responsibility for: (i) reviewing the appropriate skills and characteristics required of Board members in the context of the current make-up of the Board; and (ii) assess the Board’s compliance with laws and policies relating to the independence of certain Board members. A copy of the Corporate Governance and Nominating Committee Terms of Reference is available on our corporate website at: https://investors.charlottesweb.com.

The Corporate Governance and Nominating Committee will consider all qualified director candidates identified by various sources, including members of the Board, management and shareholders. Candidates for directors recommended by shareholders will be given the same consideration as those identified from other sources. Any shareholder who wishes to recommend a candidate for consideration by the Corporate Governance and Nominating Committee as a nominee for director should follow the procedures described in “Advance Notice Policy” under “Proposals 1 and 2—Election of Directors” in this proxy statement. The Corporate Governance and Nominating Committee is responsible for reviewing each candidate’s biographical information, meeting with each candidate and assessing each candidate’s independence, skills and expertise based on a number of factors. While we do not have a formal policy on diversity, when considering the selection of director nominees, the Corporate Governance and Nominating Committee considers individuals with diverse backgrounds, viewpoints, accomplishments, cultural background and professional expertise, among other factors.

The Corporate Governance and Nominating Committee annually assesses the Board and its committees, reviewing the skills and experience of current directors and assessing the knowledge and character of all nominees to the Board to ensure that the Board and committee members possess the required mix of qualifications, skills and experience. The Corporate Governance and Nominating Committee then discloses such information to the Board for their consideration and review in performing periodic self-evaluations.

The Compensation Committee of the Board assists the Board in fulfilling its oversight responsibilities relating to the recruitment, compensation, evaluation and retention of senior management and other key employees, and in particular the Chief Executive Officer, with the skills and expertise needed to enable the Company to achieve its goals and strategies at competitive compensation and with appropriate performance incentives.

As of the date of this proxy statement, the Compensation Committee consisted of three (3) members. The following are the members of the Compensation Committee:

The Compensation Committee held seven (7) meetings in 2021 and took one (1) action by unanimous consent. During 2021, each of the members of the Compensation Committee attended 100% of the total number of meetings held by the Compensation Committee during the periods he or she served.

The Board has adopted a written charter for the Compensation Committee, which sets out the Compensation Committee’s responsibilities. The Compensation Committee has been delegated responsibility for reviewing: (i) compensation policies and guidelines for supervisory and management personnel of the Company; (ii) corporate benefits, bonuses and other incentives, including stock options and restricted stock units; (iii) corporate goals and objectives relevant to chief executive officer compensation; (iv) non-chief executive officer and director compensation, incentive compensation plans and equity-based plans; (v) the competitiveness and appropriateness of the Company’s policies relating to the compensation of executive officers; and (vi) any material changes or trends in human resources policy, procedure, compensation and benefits. A copy of the Compensation Committee Terms of Reference is available on our corporate website at: https://investors.charlottesweb.com.

The Company believes that each of the members of the Company’s Board has the experience, qualifications, attributes and skills that make him or her suitable to serve as a director of the Company in light of the Company’s highly regulated business, the Company’s complex operations, and its large number of employees.

John Held’s specific qualifications, experience, skills and expertise include:

Jacques Tortoroli’s specific qualifications, experience, skills and expertise include:

Susan Vogt’s specific qualifications, experience, skills and expertise include:

Jean Birch’s specific qualifications, experience, skills and expertise include:

Tim Saunders’s specific qualifications, experience, skills and expertise include:

See “Proposals 1 and 2 –Election of Directors—Biographical Information” for additional information regarding the education and experience of each director.

The Board believes these qualifications bring a broad set of complementary experience to the Board’s discharge of its responsibilities.

Conflicts of interest may arise as a result of the directors, officers and promoters of the Company also holding positions as directors or officers of other companies. Some of the individuals that are directors and officers of the Company have been and will continue to be engaged in the identification and evaluation of assets, businesses and companies on their own behalf and on behalf of other companies, and situations may arise where the directors and officers of the Company will be in direct competition with the Company. Conflicts, if any, will be subject to the procedures and remedies provided under the Company’s Code of Business Conduct and Ethics and applicable law.

One of the key functions of our Board is informed oversight of our risk management process. The ‎Board does not have a standing risk management committee and instead administers this oversight ‎function directly through the Board as a whole, as well as through various standing committees of our‎ Board that address risks inherent in their respective areas of oversight. In particular, our Board is responsible for monitoring and assessing strategic risk exposure and our Audit Committee has the responsibility to consider and discuss our major financial risk exposures and the steps our management ‎has taken to monitor and control these exposures, including guidelines and policies to govern the process by ‎which risk assessment and management is undertaken. The Audit Committee also monitors compliance with ‎legal and regulatory requirements.

The Board has no policy regarding the need to separate or combine the offices of Chair of the board ‎of directors and President and Chief Executive Officer and instead the board of directors remains free to make ‎this determination from time to time in a manner that seems most appropriate for the Company. The positions ‎of Chair of the board of directors and Chief Executive Officer are currently held by John Held and Jacques Tortoroli, respectively.

In order to clearly set forth our commitment to conduct our operations in accordance with our high standards of business ethics and applicable laws and regulations, the Board adopted a Code of Business Conduct and Ethics, which we refer to as our Code of Ethics, which is applicable to all directors, officers and employees. A copy of the Code of Ethics is available on our corporate website at https://investors.charlottesweb.com. The Code of Ethics is administered by the CG&N Committee, who delegates the day-to-day responsibility for administering and interpreting the Code of Ethics to the Chief Financial Officer of the Company. The Chief Financial Officer periodically reports to the CG&N Committee in respect of administration of the Code, and any reports of variance from the Code of Ethics will be reported to the Board.

The following table provides information with respect to our executive officers as of April 28, 2022:‎

The biography of Jacques Tortoroli can be found under “Proposals 1 and 2 — Election of Directors.” The following ‎is biographical information for our other executive officers:‎

Effective April 25, 2022, Lindsey Jensen was appointed Chief Financial Officer of the Company. Ms. Jensen initially joined the Company as Senior Director, Finance, Operations Controller in September 2019 and subsequently held the role of Vice President, Finance, Sales and Operations until her appointment as Chief Financial Officer. Prior to joining the Company, Ms. Jensen was Head of Finance and Accounting at Samantha Brands Group, an investment company focused on investments in consumer brands, from May 2017 through September 2019. Prior thereto, she was the Finance Director and Corporate Treasurer at Parkifi from April 2015 through May 2017. Ms. Jensen has a Bachelor of Business Administration, International Business and Marketing, from Texas McCombs School of Business and a Master of Business Administration, Finance, from University of Colorado Boulder.

Jared Stanley is a Co-Founder of Charlotte’s Web and has served multiple executive roles for the Company since its inception in 2013 and currently serves as the Chief Operating Officer. Mr. Stanley has more than 14 years’ experience in the cannabis and hemp industry and has built the Company’s cultivation divisions from the ground up, creating first-of-its-kind scalable and consistent hemp raw material supply systems across three States and Canada. As a Co-Founder, Mr. Stanley has been featured in global press, media and public events speaking to the Company’s mission-driven story, market-leading products, and proprietary technologies. He also plays a prominent role in the Company’s legislative activities at the state and federal level for consumer access and industry advocacy. Mr. Stanley graduated from Colorado State University with a degree in Applied Human Sciences.

On September 24, 2021, Mr. Rogers joined the Company as its Senior Vice President, General Counsel and Corporate Secretary. Since 2016, Mr. Rogers has served as a legal and business consultant at Rogers Consulting LLC, acting as an independent consultant for companies focusing on international transaction and SEC matters. From 2008 until he established Rogers Consulting, LLC, Mr. Rogers served as General Counsel for Miller Brewing Company and Miller Brewing International, Inc. where he oversaw major litigation, managed regulatory compliance, and was the primary in-house counsel on several major domestic and international transactions. From July 2008 to October 2016, Mr. Rogers served on the Miller Brewing Company and Miller Brewing International Boards of Directors. From January 2012 to October 2016, Mr. Rogers served on the SABMiller Holdings, Inc. Board of Directors. Since July 1, 2021, Mr. Rogers has served as a member of the Cardinal Stritch University Board of Trustees. Additionally, since 2020, Mr. Rogers has served on the Bubler Bikes Executive Committee. Mr. Rogers holds a bachelor’s degree in Government from Hamilton College and a Juris Doctorate from Syracuse University College of Law.

The following discussion describes the significant elements of the compensation of the Company’s Chief Executive Officer (“CEO”) during 2021 and two most highly compensated executive officers (collectively, the “named executive officers” or “NEOs”). For the year ended December 31, 2021, the NEOs of the Company were Jacques Tortoroli (CEO), Wessel Booysen (CF&OO), W. Anthony True (Chief Customer Officer), Adrienne Elsner (former CEO), and Russell Hammer (former Chief Financial Officer).

The Company operates in a dynamic and rapidly evolving market. To succeed in this environment and to achieve its business and financial objectives, the Company needs to attract, retain, and motivate a highly talented team of executive officers. The Company expects its team to possess and demonstrate strong leadership and management capabilities, as well as foster the Company’s culture, which is at the foundation of its success and remains a pivotal part of the Company’s everyday operations.

The Company offers executive officers cash compensation in the form of base salary and an annual bonus, and equity-based compensation which was historically awarded in the form of stock options under the Legacy Option Plan (discussed below) and, since the Company’s initial public offering, has been awarded in the form of security-based compensation awards under the Company’s amended 2018 long term incentive plan (the “LTIP”). See “Elements of Compensation – Long-Term Incentive Plan and Amended Long-Term Incentive Plan” below.

The Company believes security-based compensation awards, such as stock options and restricted stock units, motivate its executive officers to achieve the Company’s business and financial objectives, and also align their interests with the long-term interests of the Company’s shareholders and other key stakeholders. The Company provides base salary to compensate employees for their day-to-day responsibilities, at levels it believes are necessary to attract and retain strong executive officer talent.

While the Company has determined its current executive officer compensation program is effective at attracting and maintaining executive officer talent, it evaluates its compensation practices on an ongoing basis to ensure that it is providing market-competitive compensation opportunities for its executive team. As part of this review process, the Company expects to be guided by the philosophy and objectives outlined above, as well as other factors which may become relevant, including the ability to attract and retain key employees and to adapt to growth and other changes in its business and industry.

The Compensation Committee of the Board assists the Board in fulfilling its responsibilities in respect of compensation matters. The responsibilities of the Compensation Committee include reviewing and making recommendations to the Board in respect of the compensation matters relating to the Company’s executive officers, employees and directors, including the NEOs. As at the year ended December 31, 2021, the Compensation Committee was composed of Ms. Birch (Chair), Mr. Held and Ms. Vogt, each of whom was independent at such time within the meaning of applicable Canadian securities legislation and the corporate governance rules of the Nasdaq Stock Market (“Nasdaq”) and for purposes of NI 52-110. Jacques Tortoroli, who was independent within the meaning of applicable Canadian securities legislation and Nasdaq rules during his Compensation Committee service, served on the Compensation Committee from January 1, 2021 until December 16, 2021. Each Compensation Committee member who served during 2021 has experience in the area of compensation and executive compensation, having held senior executive positions in large organizations and, through those positions, having substantial experience in matters of executive compensation.

The responsibilities of the Compensation Committee in respect of compensation matters include reviewing and recommending to the Board the compensation policies and guidelines for supervisory management and personnel, corporate benefits, bonuses and other incentives, recommending corporate goals and objectives relevant to CEO compensation, non-CEO officer and director compensation, succession plans for officers and for key employees, and material changes and trends in human resources policy, procedure, compensation, and benefits.

The Compensation Committee has unrestricted access to the Company’s personnel and documents and is provided with the resources necessary, including, as required, the engagement and compensation of outside advisors, to carry out its responsibilities.

The Company’s compensation program supports its commitment to deliver strong performance for its shareholders and other key stakeholders. The compensation policies are designed to attract, recruit and retain quality and experienced people. In addition, the compensation program is intended to create an alignment of interests between the Company’s executive officers and other employees with the long-term interests of the Company’s shareholders to ultimately enhance share value. In this way, a significant portion of each executive’s compensation is linked to maximizing long-term shareholder value.

At the same time, the Compensation Committee also recognizes that the executive compensation program must be sufficiently flexible in order to adapt to unexpected developments in the CBD wellness products market and the impact of internal and market-related occurrences from time to time, and, as such, the Compensation Committee is given the discretion to award compensation absent attainment of specific performance goals and to increase or reduce the size of any such payouts in alignment with the overall pay-for-performance philosophy.

The compensation program supports the Company’s long-term growth strategy and is designed to accomplish the following objectives:

The Compensation Committee has adopted a compensation program that covers the following key elements: (i) a base fixed amount of salary and benefits; (ii) a performance-based cash and/or RSU bonus; and (iii) awards granted under the LTIP.

The CEO of the Company provides recommendations to the Compensation Committee regarding salary adjustments, performance-based or discretionary bonuses, and security-based award grants for all of the Company’s executive employees, including the NEOs. The focus of the CEO’s and Compensation Committee’s review is on the individual executive salaries, performance-based bonus opportunity, and security-based award grants (including consideration of previous grants), with a review of the aggregate level of salary, performance-based bonus, and security-based award grants for the balance of the staff. The Compensation Committee makes specific recommendations to the Board for the salary, bonus and security-based award grants to be provided to the CEO, as well as for the salaries, bonuses and security-based award grants to be provided to all other executive officers. With the exception of certain matters that the Board has delegated to the Compensation Committee, the Board reviews all recommendations of the Compensation Committee before final approval. Any executive or director who is also an officer is excused from the directors’ meeting during any discussion of their compensation.

The Compensation Committee assesses whether the Company’s compensation program supports the Company’s principles and objectives and reviews the Company’s compensation policies on a regular basis. As part of this process, the Compensation Committee considers the implications of the risks associated with the Company’s compensation policies and practices, including the various components of the Company’s compensation program. The Compensation Committee also considers the implication of the risks associated with the Company’s compensation program, including: (i) the risk of executive officers taking inappropriate or excessive risks; (ii) the risk of inappropriate focus on achieving short-term goals at the expense of long-term return to shareholders; (iii) the risk of encouraging aggressive accounting practices; and (iv) the risk of excessive focus on financial returns and operational goals at the expense of regulatory, environmental and health and safety considerations.

While the Company recognizes that no compensation program can fully mitigate these risks, the Compensation Committee and Board believe that many of these risks are mitigated by: (i) ensuring incentives tied to share ownership and vesting are weighted to span a number of years; (ii) avoiding narrowly focused performance goals

which may encourage loss of focus on providing long-term shareholder return; (iii) retaining adequate discretion over the application and implementation of the compensation program to insure that the Compensation Committee and Board retain their business judgment in assessing actual performance; (iv) awarding a significant portion of long-term incentive compensation in the form of security-based awards which provide a direct link between corporate performance and the level of payout received; and (v) imposing restrictions on the ability of executives to participate in transactions that are designed to hedge or offset a decrease in market value of securities of the Company.

The ability of the Compensation Committee to consider factors such as personal contributions to corporate performance and non-financial based elements of corporate performance allows the Compensation Committee to consider whether executive officers have attempted to bolster short-term results at the expense of the long-term success of the Company in determining executive compensation. The incentive programs consist of a balance between annual focus through the bonus program and long-term focus through the LTIP. In addition, as the compensation program consists of fixed (base salary) and variable (performance-based bonuses, LTIP) elements, the incentive for short-term risk taking is balanced with the incentive to focus on generating long-term sustainable value for shareholders and other key stakeholders. There are no compensation policies and practices that are structured significantly different for any NEOs. The Compensation Committee and Board will continue to monitor compensation risk assessment practices on an ongoing basis to ensure that the Company’s compensation program is appropriately structured.

The compensation of the Company’s executive officers includes three major components: (i) a base fixed amount of salary and benefits; (ii) a performance-based cash and/or RSU bonus; and (iii) long-term equity incentives granted from time to time under the LTIP. Perquisites and personal benefits are not a significant element of compensation of the Company’s executive officers.

The compensation paid to the NEOs for the year ended December 31, 2021 is summarized below under the heading “Summary Compensation Table for 2021.”

The objective of base salary compensation is to reward and retain NEOs. In setting base compensation levels, consideration is given to factors such as level of responsibility, experience, expertise and impact on the long-term success of the Company’s business. Subjective factors such as leadership, commitment, and performance are also considered. The goal of the Company is to pay base salary compensation to retain the NEOs in the range of industry peers, while maintaining the overall goal that total compensation should include variable and long-term components as well.

The Compensation Committee considers performance of individual executive officers in setting annual bonus amounts. Consideration is given to factors such as management, leadership and performance, among others. The Company uses the payment of annual bonuses to incentivize strong performance and achievement of the Company’s goals and business plans. For the year ended December 31, 2021, no performance-based cash bonus was paid.

The Company’s subsidiary, Charlotte’s Web, Inc. (formerly CWB Holdings, Inc. and referred to herein as “CWB”) previously granted to directors, officers, employees and consultants certain stock options under the CWB Holdings, Inc. 2015 Stock Option Plan (the “Legacy Option Plan”). In connection with the Company’s initial public offering and related reorganization (the “Reorganization”), the Legacy Option Plan, and all outstanding stock options thereunder, were assumed by the Company. The Company amended the Legacy Option Plan to provide for the existing stock options outstanding under the Legacy Option Plan to be exercisable in accordance with the terms of the existing Legacy Option Plan for PVS following the Reorganization with applicable adjustments to the exercise price thereof and number of options exercisable to reflect the Reorganization.

No stock options were granted under the Legacy Option Plan during the year ended December 31, 2021 and no further stock options will be granted under the Legacy Option Plan. The Legacy Option Plan will be terminated when all stock options thereunder have been exercised or have expired.

Prior to giving effect to the Reorganization, 892,192 options to acquire common shares of CWB were issued and outstanding under the Legacy Option Plan (following the Reorganization, these options were equivalent to options to purchase 20,074.47 PVS, or the equivalent of 8,029,788 Common Shares upon conversion). Options under the Legacy Option Plan had been granted to directors, officers, employees, and consultants of CWB. In addition, CWB issued 576,429 founder options to acquire 576,429 common shares of CWB (following the Reorganization, these options were equivalent to options to purchase 12,969.76 PVS, or the equivalent of 5,187,904 Common Shares upon conversion).

As of April 28, 2022, no founder options remain outstanding, and stock options to purchase the equivalent of 1,300,012 Common Shares remain outstanding under the Legacy Option Plan.

On April 28, 2021, the Board approved certain amendments to the Charlotte’s Web Holdings, Inc. 2018 Long-Term Incentive Plan dated April 28, 2021 that become effective upon receipt of shareholder approval at the Company’s Annual General and Special Meeting held on June 9, 2021.

The following discussion is qualified in its entirety by the text of the LTIP filed as Exhibit 10.15 to the Annual Report on Form 10-K.

Pursuant to the LTIP, the Company may issue equity-based compensation in the form of stock options, stock appreciation rights, unrestricted shares or restricted shares, deferred share units, restricted stock awards, restricted stock units, performance shares, performance units, and other share-based awards to eligible participants. The purpose of the LTIP is to enable the Company and certain of its affiliates to obtain and retain the services of these individuals, which is essential to the Company’s long-term success.

The granting of awards under the LTIP (“Grants”) is intended to promote the long-term financial interests and growth of the Company and its subsidiaries by attracting and retaining management and other personnel and key service providers with the training, experience and ability to enable them to make a substantial contribution to the success of the Company’s business. Moreover, the LTIP aims to align the interests of eligible participants with those of the shareholders through opportunities of increased equity-based ownership in the Company.

The maximization of shareholder value is encouraged by the granting of incentives under the LTIP. The objective of the LTIP is to reward and retain NEOs. The program is designed to reward NEOs for maximizing shareholder value in a regulatory compliant and ethical manner. Increasing the value of Common Shares increases the value of the Grants. This incentive closely links the interests of the officers and directors to shareholders of the Company and encourages a long-term commitment to the Company.

Eligible participants under the LTIP include directors, officers (including the NEOs), employees and consultants of the Company and its subsidiaries. The LTIP is administered by the Compensation Committee of the Board, or such other committee duly appointed by the Board.

The terms and conditions attaching to the Grants will be determined by the Compensation Committee, or such other committee(s) or officer(s) duly appointed by the Board or the Compensation Committee, in its sole discretion, and are set forth in grant agreements. The Board has the power and discretionary authority to determine the terms and conditions of the Grants, including, without limitation, (i) the purchase price of any Shares, (ii) the method of payment for Shares purchased pursuant to any award, (iii) the method for satisfying any tax withholding obligation arising in connection with any award, including by the withholding or delivery of Shares, (iv) the timing, terms and conditions of the exercisability, vesting or payout of any award or any Shares acquired pursuant thereto, (v) the performance criteria applicable to any award and the extent to which such performance criteria have been attained, (vi) the time of the expiration of any award, (vii) the effect of the participant’s termination of service on any of the foregoing, and (viii) all other terms, conditions and restrictions applicable to any award or Shares acquired pursuant thereto as the Board shall consider to be appropriate and not inconsistent with the terms of the Plan. Generally, the term of each Grant is ten years, unless the Board or the Compensation Committee determines otherwise.

The Company currently has options and restricted stock units outstanding under the LTIP.

The LTIP provides that the total number of Common Shares reserved and available for issuance pursuant to awards granted under the LTIP (“Awards”) shall not exceed the number of Common Shares equal to ten percent (10%) of the total issued and outstanding Common Shares from time to time (assuming the conversion of the outstanding PVS into Common Shares, if applicable) less any Common Shares that are issuable pursuant to the Legacy Option Plan (the “Share Pool”). Without duplication, for the purposes of compliance with certain United States securities laws, the Share Pool shall, unless otherwise determined by the Board or the Administrator (as defined in the LTIP), be considered to be increased annually on the first day of each fiscal year of the Company, commencing with the 2022 fiscal year, by a number equal to 10% of the increase during the preceding fiscal year in the number of Common Shares outstanding (assuming the conversion of the outstanding PVS into Common Shares), as measured from the first to the last date of such fiscal year. For the avoidance of doubt, any Common Shares (assuming the conversion of the outstanding PVS into Common Shares) which become outstanding during the applicable preceding fiscal year, including any Common Shares that are issued pursuant to Awards granted under the Plan, shall be included in calculating any such increase to the Share Pool. As of January 1, 2022 and April 28, 2022, the Share Pool is 14,465,996.

The aggregate number of Common Shares that may be issued pursuant to the exercise of awards granted under ‎the LTIP, and all other security based compensation arrangements of the Company (as such term is defined in ‎the policies of the TSX) is subject to the following additional limitations: (i) no more than 10% of the issued and ‎outstanding Common Shares (on a non-diluted basis) may be reserved at any time for insiders (as defined in the Securities Act (Ontario), ‎“Insiders”)), together with all other security based compensation arrangements of the Company; and (ii) the ‎number of securities of the company issued to Insiders within any one-year period, under all security based ‎compensation arrangements, cannot exceed 10% of the issued and outstanding Common Shares. No one participant shall be granted awards ‎under the LTIP which exceed, in the aggregate, the maximum number permitted by the TSX.‎

The following additional per-person limitations apply to LTIP Grants: (i) the aggregate number of Common Shares that ‎may be reserved for issuance pursuant to the exercise of Awards granted to non-employee directors pursuant to ‎the LTIP shall not exceed 1.0% of the issued and outstanding Common Shares (on a non-diluted basis) from time to ‎time; (ii) the equity value of stock options granted to a non-employee director, within a one year period, pursuant ‎to the LTIP shall not exceed C$100,000; and (iii) the aggregate equity value of all Awards, that are eligible to be ‎settled in Common Shares granted to a non-employee director, within a one year period, pursuant to all security-‎based compensation arrangements of the Company (including, for greater certainty, the LTIP) shall not exceed ‎CAD$150,000.‎

Unless otherwise determined by the Board, no awards granted under the LTIP shall be transferable by a participant other than by will or the laws of descent and distribution. Subject to applicable laws, the Board may permit an award, other than an option or tandem stock appreciation right granted with respect to an option, to a participant's family member as a gift or pursuant to a domestic relations order in settlement of marital property rights.

The Board or the Compensation Committee may, without shareholder approval, amend, alter or discontinue the LTIP, but no amendment, alteration or discontinuation may be made which would materially impair the rights of a

participant with respect to a previously granted award without such participant's consent, except such an amendment made to comply with applicable law or rule of any securities exchange or market on which the Common Shares are listed or admitted for trading or to prevent adverse tax or accounting consequences to the Company or the participant. No amendment of the LTIP may be made without the approval of the Company's shareholders to the extent such amendment would (i) increase in the maximum number of Common Shares that may be made the subject of Awards under the LTIP; (ii) increase the limits on Awards that may be granted to any participant; (iii) permit Awards granted under the LTIP to be transferable or assignable other than by will, the laws of descent and distribution or in settlement of marital property rights; (iv) add to the categories of persons eligible to participate in the LTIP; (v) eliminate or modify the prohibition on repricing of stock options and stock appreciation rights, (vi) extend the term of an outstanding stock option or stock appreciation right beyond the expiry date thereof; (vii) modify the prohibition on the issuance of reload or replenishment options; or (viii) revise the amending provisions of the LTIP.

In the event of the termination of a participant’s employment or consultancy with, or performance of services for, the Company or its subsidiaries, unless a participant's award agreement states otherwise, to the extent stock options, stock appreciate rights, restricted stock, and restricted stock units are not vested and exercisable, such awards will be forfeited upon such termination of service. Temporary absences from employment because of illness, vacation or leave of absence and transfers among the Company and its subsidiaries shall not be considered terminations of service. In the event that any transaction resulting in a change in control occurs, outstanding awards will terminate upon the effective time of such change in control unless provision is made in connection with the transaction for the continuation or assumption of such awards by, or for the issuance therefor of substitute awards of, the surviving or successor entity or a parent thereof. Subject to the provisions of the LTIP, certain awards that terminate at the effective time of the change of control shall become fully vested and exercisable immediately before such effective time.

As of April 28, 2022, the Company has options outstanding under the LTIP to acquire an aggregate of ‎‎2,585,390 Common Shares (representing 1.78% of the issued and outstanding Common Shares) and restricted stock units outstanding for an ‎aggregate of 1,988,023 Common Shares (representing 1.37% of the issued and outstanding Common Shares).‎

Together, as of April 28, 2022, there are the equivalent of 6,311,187 Common Shares reserved for issuance ‎pursuant to the options outstanding under the Legacy Option Plan and the options and restricted stock units ‎outstanding under the LTIP, representing 4.35% of the ‎issued and outstanding Common Shares. As of April 28, 2022, the number of Common Shares remaining available for issuance pursuant to new ‎Grants ‎under the LTIP is 8,154,809 Common Shares (representing 5.62% of the issued and outstanding ‎Common Shares).‎

The Company's annual burn rate, as described in Section 613(d) of the TSX Company Manual, for the LTIP and Legacy Option Plan is as follows:

The Company has implemented a formal recoupment or “clawback” policy on the incentive compensation of its Chief Executive Officer and Chief Financial Officer, including, without limitation, options and restricted stock units that may be awarded to the Chief Executive Officer or Chief Financial Officer when (i) the executive engages in

willful misconduct or fraud which causes or significantly contributes to a restatement of the Company’s financial statements due to material noncompliance by the Company with any applicable financial reporting requirement under securities laws, (ii) the executive receives incentive compensation calculated on the achievement of those financial results, and (iii) the incentive compensation received would have been lower had the financial statements been properly reported. The policy provides that when a clawback is triggered, upon the recommendation of the Compensation Committee, the Board may, in its sole discretion and to the extent that it determines it is in the Company’s best interests to do so, require the Chief Executive Officer and/or the Chief Financial Officer to repay the amount of incentive compensation relating to the year(s) subject to the restatement or received upon exercise or payment of incentive compensation in or following the year(s) subject to the restatement that is in excess of the incentive compensation the executive would have received if the incentive compensation had been computed in accordance with the results as restated, calculated on an after-tax basis.

All of the Company’s executives, other employees, and directors are subject to the Company’s Insider Trading and Reporting Policy, which prohibits trading in the Company’s securities while in possession of material undisclosed information about the Company. Under this policy, such individuals are also prohibited from entering into hedging transactions involving securities of the Company, such as short sales, puts and calls. Furthermore, the Company permits executives, including NEOs, to trade in the Company’s securities only during prescribed trading windows. Notwithstanding these prohibitions, the Company’s directors, officers and employees are able to sell a security which such person does not own if such person owns another security convertible into the security sold or an option or right to acquire the security sold and, within 10 days after the sale, such person: (i) exercises the conversion privilege, option, or right and delivers the security so associated to the purchaser; or (ii) transfers the convertible security, option or right, if transferable, to the purchaser.

The directors and certain designated officers of the Company are subject to mandatory Common Share ownership requirements established by the Board. Each director is required to own Common Shares of the Company having a value of at least three times the amount of their annual retainer. Each designated officer is required to own Common Shares of the Company as follows: the Chief Executive Officer is required to hold three times the amount of his annual base salary; the Chief Financial Officer is required to hold two times the amount of his annual base salary; and all other designated officers are required to hold one times the amount of their annual base salaries. New directors and designated officers have five years from the date of election or appointment to the Board or appointment as an executive officer to acquire the aforementioned levels of ownership. The Common Share ownership requirements were established on May 24, 2021, and as such, all directors and designated officers serving at that time who are subject to the policy have until May 25, 2026 to satisfy the Common Share ownership requirements.

The following table sets forth all compensation paid to or earned by the named executive officers of the Company in the last fiscal year.

Effective December 16, 2021, Mr. Tortoroli entered into an at-will employment agreement with the Company (“Mr. Tortoroli’s Employment Agreement”), whereby the Company employed Mr. Tortoroli to serve as the Company’s Chief Executive Officer on an at-will basis. Pursuant to Mr. Tortoroli’s Employment Agreement, the Company agreed to pay Mr. Tortoroli an annual base salary of $425,000 with an annual discretionary bonus to be determined by the Compensation Committee, at its discretion based on Company results and individual performance against specific metrics to be developed by Mr. Tortoroli and the Company. Mr. Tortoroli’s Employment Agreement also provided for a one-time equity grant of 250,000 restricted share awards and 375,000 stock options; 25% of the restricted share awards and stock options vest on each three-month anniversary of the grant date such that all such restricted share awards and stock options will be fully vested on the one-year anniversary of the grant date. The

Company also agreed to provide Mr. Tortoroli certain perquisites, including reasonable reimbursement for a Denver or Boulder-based apartment, a leased car, and flights between Denver and New York for Mr. Tortoroli and his family members, up to a reasonable aggregate amount per year, subject to proper supporting documentation.

Mr. Tortoroli’s employment is ongoing.

The foregoing description of Mr. Tortoroli’s Employment Agreement is qualified in its entirety by reference to the agreement, which was included as Exhibit 10.34 to the Annual Report on Form 10-K.

On June 14, 2021, Mr. Booysen entered into an employment agreement with the Company (“Mr. Booysen’s Employment Agreement”), whereby the Company employed Mr. Booysen to serve as the Company’s Executive Vice President and Chief Financial Officer on an at-will basis.

Pursuant to Mr. Booysen’s Employment Agreement, the Company agreed to pay Mr. Booysen (i) an annual base salary of $535,000, (ii) an equity grant valued at $535,000, consisting of 50% restricted share awards and 50% stock options, each of which vest over a period of three years with 1/3 of grant vesting on each anniversary date, (iii) a potential annual cash bonus based on Company results and individual performance with a target bonus opportunity of 75% of the base salary and a maximum payout opportunity of 150% of the base salary for the year, and (iv) a potential annual equity incentive opportunity with a target equity award of 100% of the base salary for the year 2022, with the expectation that the equity award would consist of 50% stock options and 50% restricted share awards, each of which would vest on a four-year vesting schedule with 25% of each award vesting on each anniversary date.

Effective April 25, 2022 Mr. Booysen’s employment with the Company ceased. There was no accelerated vesting of any of Mr. Booysen’s outstanding stock options or restricted share awards.

The foregoing description of Ms. Booysen’s Employment Agreement is qualified in its entirety by reference to the agreement, which was included as Exhibit 10.24 to the Annual Report on Form 10-K.

On April 26, 2019, Ms. Elsner entered into an employment agreement with the Company, whereby, beginning May 15, 2019, the Company employed Ms. Elsner as its CEO on an at-will basis. Ms. Elsner’s employment agreement was amended on October 2, 2020 (“Ms. Elsner’s Employment Agreement”).

Pursuant to Ms. Elsner’s Employment Agreement, the Company agreed to pay Ms. Elsner (i) an annual base salary of $625,000, (ii) an equity grant valued at $2,000,000 consisting of 25% stock options and 75% restricted stock units, each of which vest on a four-year vesting schedule with 25% of each award vesting on each anniversary date, (iii) a potential annual cash bonus based on Company results and individual performance with a target bonus opportunity of 100% of the base salary and a maximum payout opportunity of 150% of the base salary for the year 2019, and (iv) a potential annual equity incentive opportunity with a target equity award of 200% of the base salary for the year 2020, with the expectation that the equity award would consist of 75% stock options and 25% restricted stock units, each of which would vest on a four-year vesting schedule with 25% of each award vesting on each anniversary date.

Ms. Elsner resigned as Chief Executive Officer effective December 16, 2021. There was no accelerated vesting of any of Ms. Elsner’s outstanding stock options or restricted share awards.

The foregoing description of Ms. Elsner’s Employment Agreement is qualified in its entirety by reference to the agreement, which was included as Exhibit 10.22 to the Annual Report on Form 10-K.

On August 15, 2019, Russell Hammer entered into an employment agreement with the Company (“Mr. Hammer’s Employment Agreement”), whereby the Company employed Mr. Hammer to serve as the Company’s Senior Vice President and Chief Financial Officer on an at-will basis with a start date of August 15, 2019.

Pursuant to Mr. Hammer’s Employment Agreement, the Company agreed to pay Mr. Hammer (i) an annual base salary of $535,000, (ii) an equity grant valued at $1,000,000 consisting of 50% stock options and 50% restricted stock units, each of which vest on the following schedule: (X) 50% of the total restricted stock units vest on the one-year anniversary of Mr. Hammer’s Employment Agreement and the remaining 50% of the restricted stock units were to vest 1/12^th of the total number of remaining shares on the corresponding day of each month thereafter, until all of

the shares were vested on the 2^nd anniversary of Mr. Hammer’s Employment Agreement, and (Y) 50% of stock options were to be vested on the third-year anniversary of Mr. Hammer’s Employment Agreement and an additional 1/12^th number of shares were to be vested on the corresponding day of each month thereafter, until all of the shares were vested on the 4^th anniversary of Mr. Hammer’s Employment Agreement, (iii) a potential annual cash bonus based on individual objectives, rather than Company metrics, with a target bonus opportunity of 75% of the base salary in 2019, and based on Company results and individual performance in 2020, and (iv) a potential annual equity incentive opportunity with a target equity award of 75% of the base salary for the year 2020, with the expectation that the equity award would consist of 75% stock options and 25% restricted stock units, each of which were to vest on a four-year vesting schedule with 25% of each award vesting on each anniversary date.

On June 14, 2021, Mr. Hammer ceased serving as an executive officer of the Company in connection with the transition of the Chief Financial Officer role to Wes Booysen. On that date, Mr. Hammer’s title was changed to Senior Executive Advisor, a role he held until his departure from the Company on August 15, 2021. In connection with his service as Senior Executive Advisor, Mr. Hammer executed a Transition Employment Agreement and Release of All Claims (the “Transition Agreement”) on June 14, 2021. Pursuant to the terms of the Transition Agreement, Mr. Hammer continued to receive all compensation in accordance with Mr. Hammer’s Employment Agreement. In connection with his departure from the Company, and at the same time as the execution of the Transition Agreement, Mr. Hammer executed a Separation Agreement and Final Release of Claims (the “Separation Agreement”). Pursuant to the terms of the Separation Agreement, the Company agreed to pay Mr. Hammer (i) penalties associated with terminating the lease on Mr. Hammer’s personal residence in Denver, (ii) moving expenses, and (iii) the severance pay and benefits provided for in Mr. Hammer’s Employment Agreement, specifically (A) one year of Mr. Hammer’s annual base salary, (B) one year of Mr. Hammer’s bonus of 75% of his annual base salary, and (C) 100% vesting of Mr. Hammer’s option grants outstanding, with all vested options to remain exercisable for 180 days after August 15, 2021.

The foregoing description of Mr. Hammer’s Employment Agreement, the Transition Agreement and the Separation Agreement are qualified in their entirety by reference to the agreements, which were included as Exhibits 10.20 and 10.23 to the Annual Report on Form 10-K.

On June 4, 2019, W. Anthony True entered into an employment agreement with the Company (“Mr. True’s Employment Agreement”), whereby the Company employs Mr. True to serve as its Chief Customer Officer on an at-will basis with a start date of July 8, 2019.

Pursuant to Mr. True’s Employment Agreement, the Company agreed to pay Mr. True (i) an annual base salary of $385,000, (ii) an equity grant consisting of options to purchase the Company’s Common Shares in an aggregate value of $288,750 at an exercise price determined as of the grant date, which vest in four equal tranches on each of the first four anniversaries of July 8, 2019, (iii) a potential annual cash bonus based on Company results and individual performance with a target bonus opportunity of 60% of the base salary and a maximum payout opportunity of 150% of the base salary for the year 2019, and (iv) a potential annual equity incentive opportunity with a target equity award of 75% of the base salary for the year 2020, with the expectation that the equity award would consist of 75% stock options and 25% restricted stock units, each of which would vest on a four-year vesting schedule with 25% of each award vesting on each anniversary date.

The foregoing description of Mr. True’s Employment Agreement is qualified in its entirety by reference to the agreement, which was included as Exhibit 10.21 to the Annual Report on Form 10-K.

Effective January 31, 2022, the Chief Customer Officer position was eliminated. At such time, Mr. True’s employment with the Company terminated. There was no accelerated vesting of any of Mr. True’s outstanding stock options or restricted share awards.

The following table sets forth outstanding equity awards for the named executive officers of the Company at fiscal 2021 year end.

The Company does not have a defined benefit plan or deferred compensation plan; however, the Company does have a defined contribution plan (the “401(k) plan” or “401(k)”) under the provisions of the Employment Retirement Income Security Act of 1974, which is administered through T. Rowe Price, as plan administrator. Pursuant to the 401(k) plan, the Company has generally provided standard safe harbor matching and discretionary matching 401(k) plan contributions to all eligible and participating employees up to certain maximum thresholds. Participating employees must make their own contributions in order to receive matching funds from the Company. All employees that are at least 21 years of age and have completed three months of service with the Company are eligible to make salary deferral contributions to the 401(k) plan. Participating employees of the Company who are at least 21 years of age are eligible for the Company match. At the outset of the COVID-19 pandemic, the Company suspended matching contributions under the 401(k) plan. However, as of July 1, 2021, the Company reinstated its 401(k) matching program. The Company does not discriminate between executives and non-executives under the 401(k) plan.

The Company makes standard safe harbor matching contributions equal to 100% of a participating employee’s 401(k) salary deferral contributions up to 3% of their base compensation plus 50% of the employee’s 401(k) salary deferral contributions up to the next 2% of their base compensation. Employees can make additional voluntary salary deferral contributions, for total combined contributions up to the legislated government maximums. In addition, the 401(k) plan provides for discretionary matching and/or discretionary profit-sharing contributions, both allocated among eligible employees in accordance with the terms of the 401(k) plan.

Participating employees are immediately 100% vested in all employee contributions and in the safe harbor matching contribution, plus any earnings that are generated thereon. However, any discretionary matching contributions and discretionary profit-sharing contributions vest according to a schedule based on the number of years of service, as follows: 25% after one year of service; 50% after two years of service; 75% after three years of service; and 100% after four years of service and beyond.

The Company (and/or its subsidiary) has entered into executive employment agreements with each of the NEOs (the “Employment Agreements”). Each Employment Agreement provides for the NEO’s annual base salary, vacation entitlement, and benefits.

The Employment Agreements have effective dates, entitlements on a termination without just cause and change of control as follows:

Options and awards granted under the Legacy Option Plan and LTIP contain provisions allowing for the exercise, in certain circumstances, of options following termination (other than by reason of death, disability, retirement or for cause). Under the LTIP, in the event that any transaction resulting in a change in control occurs, outstanding awards will terminate upon the effective time of such change in control unless provision is made in connection with the

transaction for the continuation or assumption of such awards by, or for the issuance therefor of substitute awards of, the surviving or successor entity or a parent thereof. Subject to the provisions of the LTIP, certain awards that terminate at the effective time of the change of control shall become fully vested and exercisable immediately before such effective time.

The Board adopted an executive change in control severance plan effective December 6, 2021 (the “Severance Plan”). The Severance Plan provides severance and change-in-control protections to certain key employees of the Company‎. The Severance Plan is for the benefit of employees of the Company in a senior management position (which includes senior directors or members of the Company’s executive leadership team), designated as participants by the Compensation Committee from time to time. Subject to the terms and conditions of the Severance Plan, the Severance Plan provides that, in the event of involuntary termination of a participant’s employment during the twelve month period following the effective date of a change in control, such participant shall be entitled to a severance payment equal to six (6), nine (9) or twelve (12) months (the “Severance Period”) of base salary for (i) senior directors, (ii) executive leadership team members, and (iii) Chief Executive Officer and Chief Financial Officer, respectively. In addition and subject to certain conditions as set out in the Severance Plan, the Company shall, at the Company’s expense, provide medical coverage through the Company’s group medical plans throughout the Severance Period, unless the individual earlier becomes eligible to receive healthcare coverage from a subsequent employer.

The Company has directors’ and officers’ liability insurance coverage for losses to the Company if the Company is required to reimburse directors and officers, where permitted, and for direct indemnity of directors and officers where corporate reimbursement is not permitted by law. This insurance protects the Company against liability (including costs), subject to standard policy exclusions, which may be incurred by directors and/or officers acting in such capacity for the Company. All directors and officers are covered by the policy and the amount of insurance applies collectively to all. The annual cost for this insurance in 2021 was $2,173,503.

In addition, indemnity agreements have been entered into with each director and certain executive officers pursuant to which the Company has agreed to indemnify such directors and officers from liability arising in connection with the performance of their duties. Such indemnity agreements conform to the provisions of the BCBCA.

Other than as set forth herein, the Company did not pay any other compensation to NEOs (including personal benefits and securities or properties paid or distributed which compensation was not offered on the same terms to all full-time employees) during the financial year ended December 31, 2021, other than benefits and perquisites which did not amount to $10,000 or greater per individual.

As at December 31, 2021, the Company had five (5) directors, one of whom was also an employee: Jacques Tortoroli (Chief Executive Officer). Adrienne Elsner (former President and CEO), Joel Stanley (former Chairman) and Jared Stanley (Chief Operating Officer) each also served on the Board for a portion of 2021. Adrienne Elsner resigned as a director effective December 16, 2021. Joel Stanley and Jared Stanley resigned as directors effective March 2, 2021.

Employees who are also directors do not receive additional compensation for their services as directors. Ms. Elsner and Messrs. Jared Stanley and Joel Stanley did not receive any additional compensation for their services as directors during the year ended December 31, 2021. Mr. Tortoroli received compensation as a director during 2021 until his appointment as CEO on December 16, 2021. For a description of the compensation paid to Mr. Tortoroli and Ms. Elsner, see “Summary Compensation Table for 2021,” above.

Each member of the Company’s Board is entitled to reimbursement for reasonable travel and other expenses incurred in connection with attending Board meetings and meetings for any committee on which he or she serves.

The form and amount of director compensation is reviewed annually and as deemed advisable by the Compensation Committee, which shall make recommendations to the Board based on such review. The Compensation Committee reviews director compensation on an annual basis to ensure that the Company offers director compensation that is: (i) commensurate with the efforts the Company expects from existing Board members; (ii) competitive in the Company’s industry in order that the Company might attract the best possible candidates to assist the Company and its shareholders in a fiduciary capacity to maximize the opportunity presented by that growth; and (iii) aligned with shareholder interests as the Company grows. The Board retains the ultimate authority to determine the form and amount of director compensation.

The chart below outlines the Company’s current director compensation program for its non-employee Directors:

The following table sets forth all compensation paid to or earned by each director of the Company during fiscal year 2021.

Other than as set forth herein, the Company did not pay any other compensation to non-employee Directors (including personal benefits and securities or properties paid or distributed which compensation was not offered on the same terms to all full-time employees) during the financial year ended December 31, 2020, other than benefits and perquisites which did not amount to $10,000 or greater per individual.

The following table sets forth securities of the Company that are authorized for issuance under equity compensation plans as at the end of the Company's financial year ended December 31, 2021. As at December 31, 2021 and the April 28, 2022, the LTIP is the only compensation plan under which any Common Shares may be issued.

As of December 31, 2021, the Company had: (i) options outstanding under the Legacy Option Plan to acquire an ‎aggregate of 1,300,012 Common Shares (representing 0.90% of the issued and outstanding Common Shares); (ii) ‎options outstanding under the LTIP to acquire an aggregate of 1,606,109 Common Shares (representing 1.11% of ‎the issued and outstanding Common Shares); (iii) 1,816,851 restricted stock units outstanding (representing 1.26% ‎of the issued and outstanding Common Shares); and (iv) Replacement Options issued to former stock option ‎holders of Abacus Health Products, Inc. outstanding to acquire an aggregate of 437,762 Common Shares ‎‎(representing 0.30% of the issued and outstanding Common Shares).‎

As of the April 28, 2022, the Company had: (i) options outstanding under the Legacy Option Plan to acquire an ‎‎aggregate of 1,300,012 Common Shares (representing 0.90% of the issued and outstanding Common Shares); (ii) options outstanding under the LTIP to ‎acquire an aggregate of 2,585,390 Common Shares (representing 1.78% of ‎the issued and outstanding ‎Common Shares); (iii) 1,988,023 restricted ‎stock units outstanding (representing ‎‎1.37% of the issued and outstanding Common Shares); and (iv) Replacement Options issued to former stock ‎option holders of Abacus Health Products, Inc. outstanding to ‎acquire an aggregate of 437,762 Common Shares ‎‎(representing 0.30% of the issued and outstanding Common ‎Shares).‎

As of April 28, 2022, the number of Common Shares remaining available for issuance pursuant to grants ‎under the ‎LTIP is 8,154,809 Common Shares (representing 5.62% of the issued and outstanding Common Shares).‎‎

None of the directors, the executive officers of the Company, or any of their respective associates or affiliates is or has been, during the year ended December 31, 2021, indebted to the Company or any of its subsidiaries in respect of loans, advances or guarantees of indebtedness.

Other than as described elsewhere in this proxy statement,‎ none of the informed persons (as such term is defined in NI 51-102) of the Company, any proposed director of the Company, or any associate or affiliate of any informed person or proposed director, has had any material interest, direct or indirect, in any transaction of the Company since the commencement of the Company’s most recently completed financial year or in any proposed transaction which has materially affected or would materially affect the Company or any of its subsidiaries.

Mr. Jared Stanley, Chief Operating Officer of the Company, is a Co-Founder of Stanley Brothers USA and, following execution of the SBH Purchase Option assumed a seat on the board of directors of Stanley Brothers USA. Mr. Jared Stanley resigned as a member of the Company’s board of directors effective March 2, 2021 in order to transition to the board position with Stanley Brothers USA. See “Proposals 1 and 2 – Election of Directors - Company Transactions with Related Parties” for further information on the SBH Purchase Option. Mr. Jared Stanley has an address c/o Charlotte’s Web at ‎1801 California Street, Suite 4800, Denver, CO, 80202‎.

Since January 1, 2021, there have been no management functions of the Company or its subsidiaries which were to any substantial degree performed by a person or a company other than the directors or executive officers of the Company or its subsidiaries.

In August 2019, at the annual general and special meeting of the shareholders of the Company’s voting shares, the Company’s shareholders approved an amendment to the Company’s articles to allow the Company to become a benefit company under the BCBCA, as a demonstration of its long-term commitment to conducting its business in a responsible and sustainable manner and promoting one or more public benefits. The Company became a benefit company under the BCBCA on July 24, 2020.

Benefit companies also are required under the BCBCA to publish on their websites and provide to their shareholders an annual benefit report that assesses, against a selected third-party standard, their performance in carrying out the commitments set out in the benefit company’s benefit provisions. For so long as the Company is a benefit company under the BCBCA, the Company will include an annual benefit report as part of its annual proxy materials sent to its shareholders and post the report to its website.

The Company has included a copy of its Annual Benefit Report in respect of the year ended December 31, 2021 as Exhibit II to this proxy statement.

Additional information relating to the Company, including copies of the Company’s financial statements and management's discussion and analysis, is available on SEDAR at www.sedar.com and on EDGAR at www.sec.gov/, copies of which may be obtained from the Company upon request by emailing the Corporate Secretary at legal@charlottesweb.com or by calling at (720) 484-8930.

The contents and the sending of this proxy statements have been approved by the Board.

 

The Board of Directors (the “Board”) of Charlotte’s Web Holdings, Inc. (the “Company”) is responsible ‎under law to supervise the management of the business and affairs of the Company. The Board has the ‎statutory authority and obligation to protect and enhance the assets of the Company, while conducting ‎the business of the Company in a responsible and sustainable manner and promoting the public benefits ‎specified in the Company's articles.‎

The principal mandate of the Board is to oversee the management of the business and affairs of the ‎Company, and monitor the performance of management.‎

In keeping with generally accepted corporate governance practices and the recommendations contained ‎in National Policy 58-201 adopted by the Canadian Securities Administrators, and the requirements of ‎any stock exchange on which the Company’s securities are listed, the Board assumes responsibility for ‎the stewardship of the Company and, as part of the overall stewardship responsibility, explicitly ‎assumes responsibility for the following:‎

The Board retains the responsibility for managing its own affairs, including planning its composition, ‎selecting its Chairman and/or Lead Director, appointing Board committees and determining directors’ ‎compensation. While it is appropriate to confer with management on the selection of candidates to be ‎nominated as members of the Board, the ultimate selection shall be determined by the existing members ‎of the Board. The Chairman of the Board should be an independent director¹‎, and where this is not ‎appropriate, an independent director1 should be appointed to act as Lead Director.‎

In that the Board must develop and voice objective judgment on corporate affairs, independently of ‎management, practices promoting Board independence will be pursued. This includes constituting the ‎Board with a majority of independent and unrelated directors. Certain tasks suited to independent ‎judgments will be delegated to specialized committees of the Board that are comprised exclusively of ‎independent directors⁽¹⁾ and at least a majority of unrelated directors.‎

The Board will evaluate its own performance in a continuing effort to improve. For this purpose, the ‎Board will establish criteria for Board and Board member performance, and pursue a self-evaluation ‎process for evaluating both overall Board performance and contributions of individual directors.‎

The Board ultimately has the responsibility to oversee the development and approval of the mission of ‎the Company, its goals and objectives, and the strategy by which these objectives will be reached. In ‎guiding the strategic choices of the Company, the Board must understand the inherent prospects and ‎risks of such strategic choices.‎

While the leadership for the strategic planning process comes from management of the Company, the ‎Board shall bring objectivity and a breadth of judgment to the strategic planning process and will ‎ultimately approve the strategy developed by management as it evolves.‎

The Board is responsible for monitoring management’s success in implementing the strategy and ‎monitoring the Company’s progress to achieving its goals; revising and altering direction in light of ‎changing circumstances.‎

The Board has the responsibility to ensure congruence between the strategic plan and management’s ‎performance.‎

The Board shall understand the principal risks of all aspects of the business in which the Company is ‎engaged, recognizing that business decisions require the incurrence of risk. The Board is responsible ‎for providing a balance between risks incurred and the potential returns to shareholders of the Company. ‎This requires that the Board ensure that systems are in place to effectively monitor and manage risks ‎with a view to the long-term viability of the Company and its assets, and conduct an annual review of the ‎associated risks.‎

The Company is committed to effective practices in corporate governance. The Company consistently ‎assesses and adopts corporate governance measures. The Corporate Governance and Nominating ‎Committee shall be responsible for overseeing disclosure of the Company’s approach to corporate ‎governance in public disclosure documents.‎

As the Board functions, the Board must ensure the execution of plans and operations are of the highest ‎caliber. The key to the effective discharge of this responsibility is the approval of the appointment of ‎the senior officers of the Company and the assessment of each senior officer’s contribution to the ‎achievement of the Company’s strategy. In this respect, performance against objectives established by ‎the Board is important, as is a formal process for determining the senior officers’ compensation, in part, ‎by using established criteria and objectives for measuring performance. To the extent feasible, the Board ‎should also satisfy itself as to the integrity of the Chief Executive Officer (“CEO”) and other executive ‎officers, and that such officers create a culture of integrity throughout the Company. “Executive officer” ‎has the meaning set out in National Instrument 51-102 - Continuous Disclosure Obligations.‎

On a regular basis, the Board shall review a succession plan, developed by management, addressing the ‎policies and principles for selecting a successor to the CEO and other key senior officer positions, both ‎in an emergency situation and in the ordinary course of business. The succession plan should include an ‎assessment of the experience, performance, skills, training and planned career paths for possible ‎successors to the CEO currently in the Company’s senior officers.‎

All members of the Board should make every effort to attend all meetings of the Board and ‎meetings of committees of which they are members, if any. Although attendance in person is ‎encouraged, members may attend by telephone to mitigate schedule conflicts.‎

Each member of the Board should be sufficiently familiar with the business of the Company, ‎including its financial statements and capital structure, and the risks and competition it faces, to ‎facilitate active and effective participation in the deliberations of the Board and of each ‎committee on which he or she serves.‎

One of the most important roles of the Board is to monitor financial performance. Each member ‎of the Board should know how to read financial statements, and should understand the use of ‎financial ratios and other indices for evaluating financial performance.‎

The Company values the experiences Board members bring from other boards on which they ‎serve, but recognizes that those boards may also present demands on a member’s time and ‎availability, and may also

present conflicts of interest or other legal issues. Members of the ‎Board should advise the Chair of the Corporate Governance and Nominating Committee before ‎accepting any new membership on other boards of directors or any other significant commitment ‎involving an affiliation with other related businesses or governmental units.‎

All members of the Board are invited to contact the CEO at any time to discuss any aspect of ‎the Company’s business. While respecting organizational relationships and lines of ‎communication, members of the Board have complete access to other members of ‎management. There shall be afforded frequent opportunities for members of the Board to meet ‎with the CEO, CFO and other members of management in Board and committee meetings and in ‎other formal or informal settings.‎

The proceedings and deliberations of the Board and its committees are confidential. Each ‎member of the Board shall maintain the confidentiality of information received in connection with ‎his or her services.‎

All members of the Board should make every effort to review all meeting materials prior to ‎meetings of the Board and meetings of committees of which they are members.‎

The Board is responsible to ensure that the Company has policies in place to ensure effective and timely ‎communication and disclosure to the shareholders of the Company, other stakeholders and the public in ‎general. This communication and disclosure policy must effectively and fairly present the operations of ‎the Company to shareholders and should accommodate feedback from shareholders, which should be ‎considered into future business decisions.‎

The Board has the responsibility for ensuring that the financial performance of the Company is reported ‎to shareholders on a timely and regular basis and for ensuring that such financing results are reported ‎fairly, in accordance with generally accepted accounting principles.‎

The Board has the responsibility for ensuring that procedures are in place to effect the timely reporting ‎of any developments that have a significant and material impact on the value of shareholder assets.‎

The Board has the responsibility for reporting annually to shareholders on its stewardship for the ‎preceding year.‎

To effectively discharge its duties, the Board shall ensure that the Company has in place effective ‎control and information systems so that it can track those criteria needed to monitor the implementation ‎of the Company’s strategy.‎

Similarly, in reviewing and approving financial information, the Board shall ensure that the Company has ‎an audit system, which can inform the Board of the integrity of the data and compliance of the financial ‎information with generally accepted accounting principles.‎

The Board’s management of the important areas of corporate conduct, such as the commitment of the ‎Company’s assets to different businesses or material acquisitions, shall also be supported by effective ‎control and information systems.‎

The Board is responsible for ensuring that routine legal requirements, documents, and records have been ‎properly prepared, approved and maintained by the Company.‎

The Board may delegate specific responsibilities to committees of the Board in order to effectively ‎manage the affairs of the Company.‎

The foregoing is (i) subject to and without limitation of the requirement that in exercising their powers and ‎discharging their duties, the members of the Board act honestly and in good faith with a view to ‎conducting business in a responsible and sustainable manner and promoting the Company's public ‎benefits, balanced with the duty to act honestly and in good faith with a view to the best interests of the ‎Company and its shareholders; and (ii) subject to, and not in expansion of the requirement, that in ‎exercising their powers and discharging their duties the members of the Board exercise the care, ‎diligence and skill that a reasonably prudent person would exercise in comparable circumstances.‎

The members of the Board will collectively assess the performance of the Board as a whole, the ‎committees of the Board and all directors with reference to their respective mandates, charters or terms ‎of reference. Individual directors will be assessed with reference to any applicable position descriptions, ‎as well as the competencies and skills that each director is expected to bring to the Board.‎

Unless otherwise determined by the Board, such assessment will occur informally and on an annual ‎basis, with an emphasis on the overall effectiveness and contributions made by the Board as a whole, ‎the committees of the Board and all directors individually.‎

 

April 28, 2022

Hello,

Charlotte's Web was a mission before it was a company. A mission to unlock the power of botanicals and provide access to cannabis wellness. At the forefront of all we do is bringing hemp extract based dietary supplements and topicals to people in a way that honors our founding families, our communities, employees, and the soil that nurtures us. We are dedicated to creating industry-leading standards for product quality, safety, and consistency. Our extracts harness powerful botanical benefits, we simply serve as nature's stewards.

Thank you for joining us on this journey to improve lives and our planet, naturally.

Jacques Tortoroli

CEO, Charlotte's Web

Charlotte's Web Holdings, Inc. (“Charlotte's Web” or the “Company”) became a benefit company under the laws of British Columbia on July 24, 2020, which means we are formally committed to conducting our business in a responsible and sustainable manner, and to promoting one or more public benefits. The public benefit selected by the Company is: ‎‎“[t]o pioneer the way to healthier lives, stronger communities, and a more bountiful planet ‎by making it easier for everyone to access the natural restorative power of plants” and the mission of Charlotte's Web is: “to unleash the healing powers of botanicals with compassion and science, benefitting the planet and all who live upon it.”

As a benefit company, Charlotte's Web is excited to share our annual benefit report for the most recently completed financial year to promote public benefit and assess our performance against a third-party standard. The third-party standard Charlotte's Web uses is B Corp certification from B Lab.

Charlotte's Web was born out of a desire to better the planet and the people living upon it. We have always envisioned a world in which people live healthier lives through the healing powers of botanicals grown in peaceful balance with Nature. Beginning with our NorthStar and the namesake of the company, Charlotte Figi, we believe that hemp based botanical products have helped improve the well-being of hundreds of thousands of people. From the outset, social responsibility was built into the DNA of the business, and that ethos has remained a cornerstone of our growth over the past eight years. Charlotte's Web has consistently committed to community investment through financial and product contributions, and volunteer hours.

During the year ended December 31, 2021, we made every effort to conduct our business in a responsible and regenerative manner, considering the well-being of people and communities affected by the operations of the Company, while also endeavoring to use a fair and proportionate share of available environmental, social, and economic resources and capacities.

Specifically, Charlotte's Web has:

As set out in the ‎Articles, Charlotte's Web is committed to promoting the public benefit of: “pioneer[ing] the way to healthier lives, stronger communities, and a more bountiful planet by making it easier for everyone to access the natural restorative power of plants”.

We create focused, measured, meaningful philanthropic partnerships. From active and vibrant employee volunteerism to donating a portion of our profits to vetted charitable organizations, we use our business as a force for hope, strength, and virtue. Charlotte's Web has an engaged employee base that places a high value on corporate citizenship and is willing and eager to participate in the company's CSR (Corporate Social Responsibility) initiatives. We have found that good stewardship of our planet and its resources is an engagement tool that contributes to certain key business drivers, namely attracting, retaining, and growing a high-performing workforce.

Our main philanthropic endeavors are in the areas of responsible agriculture, the environment, and conservation; empowering women and children; veterans and first responders; and canine service animals.

Specifically, Charlotte's Web:

British Columbia's public benefit legislation requires benefit companies to assess and report on their overall performance in conducting their business in a responsible and sustainable manner and in promoting the selected public benefits, against an independent “third-party standard” that meets certain statutory criteria relating to transparency and credibility.

The Company is a B Corp certified by B Lab, a non-profit organization that administers B Corporation certification. Certified B Corps achieve a minimum verified score on the B Impact Assessment (the “BIA”) - a rigorous assessment of a company's impact on its workers, customers, community, and environment - and make their B Impact Report transparent on the B Lab website. Certified B Corporations also amend their legal governing documents to require their board of directors to balance profit and purpose. The combination of third-party validation, public transparency, and legal accountability helps Certified B Corps build trust and value. The Company must re-certify as a B Corp every three years.

The BIA is developed through a transparent process and is audited by B Lab and comprehensively covers the impact of a business on all its stakeholders, including its workers, suppliers, community, and the environment. The BIA also captures best practices regarding mission, measurement, and governance. The last, heavily weighted, portion of the BIA identifies a company's specific “Impact Business Models,” which include the targeted, formal focus on a benefiting a particular stakeholder through products and services or internal practices.²

Given our familiarity with the BIA and the respect which the standard is accorded in the industry, Charlotte's Web has selected B Lab's BIA as our independent “third-party standard” under the British Columbia benefit company legislation. This Benefit Report is for the first financial year in which the Charlotte's Web has been a benefit company under British Columbia law, and therefore it is the first Benefit Report for which this standard has been selected and applied.

Charlotte's Web was certified by B Lab in August 2020 and received a score of 92.8.

 

The undersigned, a director of Charlotte's Web, hereby confirms that the above Benefit Report was approved by the Board of Directors of the Company on April 28, 2022.