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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 11, 2022
| AKERNA CORP. |
| (Exact name of registrant as specified in its charter) |
| Delaware | 001-39096 | 83-2242651 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
| 1550 Larimer Street, #246, Denver, Colorado | 80202 | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: (888) 932-6537
| Not Applicable |
| (Former name or former address, if changed since last report) |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
||
| Common Stock, par value $0.0001 per share | KERN | NASDAQ Capital Market | ||
| Warrants to purchase one share of Common Stock | KERNW | NASDAQ Capital Market |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Departure of John Fowle as Chief Financial Officer
On May 11, 2022, Akerna Corp. (the “Company”) and John Fowle the Company’s Chief Financial Officer and Secretary agreed to a mutual separation effective as of May 17, 2022. Mr. Fowle is leaving to pursue other opportunities.
Appointment of Larry Dean Ditto, Jr. as Interim Chief Financial Officer
On May 11, 2022, the Board of Directors of the Company appointed Larry Dean Ditto, Jr. as Interim Chief Financial Officer (“Interim CFO”) of the Company effective May 17, 2022.
Mr. Ditto, 55, has served as accounting and financial consultant for the Company since April 21, 2022. Mr. Ditto is the Chief Financial Officer (“CFO”) of Mydecine Innovations Group, Inc (“Mydecine”), where he has served as CFO since December 2020 and will continue to serve as CFO concurrent to his service as the Company’s Interim CFO. Prior to his service at Mydecine, Mr. Ditto served Sigue Corporation from June 2019 through December 2020. He was the company’s CFO and, following his CFO tenure, also supported the company as a Financial Consultant. He served as the Vice President and Corporate Controller of OSI Systems, Inc. from April 2018 through June 2019 and the CFO of DLH Davinci LLC (Dental Lab Holdings) from January 2016 through April 2018. Mr. Ditto holds a Bachelor of Arts in Economics and Management from Albion College and holds a Master of Business Administration from the Kelley School of Business at Indiana University.
Prior to Mr. Ditto’s appointment as Interim CFO, the Company and Mr. Ditto entered into a consultant agreement dated April 21, 2022 (the “Consulting Agreement”). Pursuant to the Consulting Agreement, Mr. Ditto has agreed to perform certain financial and accounting related services. The Company will pay Mr. Ditto a monthly fee of $12,000 for performance of services up to 80 hours per calendar month. If Mr. Ditto performs more than 240 hours of service per calendar quarter, Mr. Ditto will be paid $150 per hour for additional services performed exceeding 240 hours per calendar quarter, subject to the Company’s approval of such additional services. In the event that Mr. Ditto becomes a full-time employee during the term of the Consulting Agreement, the Company will grant Mr. Ditto restricted stock units that are valued at $25,000 and will immediately vest upon the grant. Unless terminated by either party in accordance with the Consulting Agreement, the Consulting Agreement will terminate after 12 months. The term of the Consulting Agreement can be extended by mutual agreement between the Company and Mr. Ditto. Mr. Ditto is also eligible for a one-time $18,000 bonus if an acquisition of the Company occurs, subject to certain terms and conditions. Mr. Ditto’s compensation as described above under the Consulting Agreement has not changed as a result of his appointment as Interim CFO.
There is no arrangement or understanding between Mr. Ditto and any other person pursuant to which he was selected as an officer of the Company. Additionally, there are no family relationships between any director or executive officer of the Company and Mr. Ditto.
Transition of Ray Thompson from President and Chief Operating Officer to Special Advisor to the Chief Executive Officer
On May 16, 2022, the Company and Ray Thompson, the Company’s President and Chief Operating Officer, agreed to a transition, effective immediately, by which Mr. Thompson will move from his current role as President and Chief Operating Officer to Special Advisor to the Chief Executive Officer. In that role, Mr. Thompson will continue to assist the Chief Executive Officer with certain of the day-to-day operations of the Company and advise the Company on various aspects of corporate strategy. In relation to the Company’s enterprise business, Jeff Kiehn, the Company’s current President of Akerna Enterprise will report to the Chief Executive Officer. Additionally, the Company intends for the functions of strategic communications, compliance, technology, and human resources to report directly to the Company’s Chief Executive Officer.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
| 10.1 | Consulting Agreement, between Akerna Corp. and Larry Dean Ditto, Jr., dated April 21, 2022 | |
| 99.1 | Press Release of Akerna Corp., dated May 17, 2022* | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
* - Furnished not filed for purposes of Section 18 of the Exchange Act; not incorporated by reference in any filing that the Company makes under the Securities Act or the Exchange Act, except as expressly set forth by specific reference in such a filing.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.
| Dated: May 16, 2022 | AKERNA CORP. | |
| By: | /s/ Jessica Billingsley | |
|
Name: Jessica Billingsley Title: Chief Executive Officer |
||
2
Exhibit 10.1
Exhibit 99.1
Akerna Announces Strategic Review and Organizational Changes
Akerna (Nasdaq: KERN), a leading enterprise software company and developer of one of the most comprehensive technology infrastructures, ecosystems, and compliance engines powering the global cannabis industry, today announces that it has engaged JMP Securities to assist in evaluating strategic alternatives as the Company and the Board seek to maximize stakeholder value.
“Our goal is to ensure we are taking every possible step to maximize value for our stakeholders,” said Jessica Billingsley, CEO and Board Chair of Akerna. “We are actively involved in strategic discussions and are happy to have JMP assist us in evaluating our opportunities, given their deep experience in the technology sector. We are confident in our ability to capitalize on the strength of our business and we remain intensely committed to our clients, our team members and all other stakeholders.”
The Company also announces that John Fowle, Akerna’s current CFO, is leaving to pursue other interests, effective May 17. The Board has appointed Dean Ditto as Akerna’s interim CFO.
Jessica Billingsley, CEO and Board Chair of Akerna, said, “I would like to thank John for his valuable contributions during an important part of Akerna’s evolution, including building a strong finance team and leveraging his strength in metrics to establish the foundation of Akerna’s reporting.”
“It has been a great pleasure to serve as Akerna’s CFO over the past two years,” said John Fowle. “I am grateful for the opportunity to work with one of the most dedicated teams in the cannabis software industry.”
Dean Ditto has been working with Akerna as a consultant since April 21, 2022. He is a dedicated and driven financial executive with extensive experience leading and elevating all aspects of the financial function, including SEC reporting, capital markets, cash management, business combinations and profit improvement initiatives. He is a trusted advisor to executive teams, boards and shareholders.
In addition, Ray Thompson will be transitioning from his current role of President & COO of Akerna Corp. to Special Advisor to CEO. In this role, Ray will continue to oversee the legacy business, assist the CEO with special projects and advise on various aspects of corporate strategy.
“It’s been a privilege to serve as President & COO for Akerna, and I look forward to continuing to advise the organization on its business strategies in my new role as Special Advisor to the CEO,” said Ray Thompson.
There can be no assurance that this strategic review process will result in the Company pursuing a particular transaction or other strategic outcome or action. Akerna has not set a specific timetable for completion of this process, and it does not intend to disclose further developments in the process unless and until it determines that further disclosure is material and appropriate for disclosure or as may be required by law.
Akerna has retained JMP Securities as its financial advisor to assist in the strategic review process.
About Akerna
Akerna (Nasdaq: KERN) is an enterprise software company focused on compliantly serving the cannabis, hemp, and CBD industry. First launched in 2010, Akerna has tracked more than $30 billion in cannabis sales to date and is the first cannabis software company listed on Nasdaq. The company’s cornerstone technology, MJ Platform, one of the world’s leading cannabis infrastructure as a service platform, powers retailers, manufacturers, brands, distributors, and cultivators.
For more information, visit https://www.akerna.com/.
Forward Looking Statements
Certain statements made in this release are “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. When used in this press release, the words “estimates,” “projected,” “expects,” “anticipates,” “forecasts,” “plans,” “intends,” “believes,” “seeks,” “may,” “will,” “should,” “future,” “propose” and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements. Such forward-looking statements include but are not limited to statements regarding the Company’s strategic review, the timing and outcome of any such strategic review, the ability of the Company to act on any particular option, the ability of the Company and the Board to maximize stakeholder value as part of the strategic review, the ability of the Company to act of the strengths of the business, the ability of the Company to leverage Mr. Ditto’s strengths and other similar statements about future performance and results. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of significant known and unknown risks, uncertainties, assumptions, and other important factors, many of which are outside Akerna’s control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Important factors, among others that may affect actual results or outcomes, include risks and uncertainties disclosed from time to time in Akerna’s filings with the U.S. Securities and Exchange Commission, including those under the heading “Risk Factors” in the Company’s latest annual report on Form 10-K filed on March 31, 2022 and in its subsequent reports. You are cautioned not to place undue reliance on forward-looking statements. All information herein speaks only as of the date hereof, in the case of information about Akerna, or the date of such information, in the case of information from persons other than Akerna. Akerna undertakes no duty to update or revise the information contained herein except as may be required by law.