On June 13, 2023, Charlotte's Web Holdings, Inc. announced that it comments on certain demands made to the Company's Board of Directors by Joel and Jesse Stanley in connection with the Company's upcoming June 15, 2023, annual general shareholder meeting. The Company stated that on June 9, 2023, Joel and Jesse delivered a letter to the Board demanding that the Board take immediate steps to facilitate the replacement of a majority of Board members, including all but one of the independent Board members (the Targeted Directors) with 4 individuals selected by Joel and Jesse, and 2 of 4 individuals proffered were Joel and Jesse themselves and one of the individuals is their long-standing business associate. The Company stated that both the letter, and a subsequent press release issued by Joel and Jesse on June 12, 2023, advise that they have communicated with certain Company shareholders in an effort to reconstitute the Board.

The Letter demanded that the Board waive the application of the Company's advance notice by-laws, which are designed to ensure that the Corporate Governance and Nominating Committee and the Board have sufficient time to vet potential Board nominees, including with respect to suitability and independence. Joel and Jesse's demands generally, and the timing specifically, are designed to circumvent the procedures and processes in place to protect shareholders and allow them to make an informed decision with respect to the election of directors. The Company stated that there are significant ongoing business relationships between Charlotte's Web and entities in which Joel and/or Jesse hold direct or indirect interests, certain of which are or will be subject to Board review and approval in the near future.

The Board does not intend to abrogate its fiduciary responsibilities to shareholders by facilitating the removal of 3 independent Targeted Directors in favor of non-independents. This would effectively hand control of the Company to individuals of which at least 2 have significant conflicts of interest and who have elected to avoid appropriate vetting procedures. Such procedures are designed to, among other things, protect shareholders from conflicts of interest.

In addition, the Company stated that the Board of Directors, as well as Institutional Shareholder Services and Glass Lewis and Co., LLC recommend that shareholders vote for each of the Company's nominees for election to the Board at the upcoming annual meeting.