8-K
CEA Industries Inc. (BNC)
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):
February27, 2023
CEA
INDUSTRIES INC.
(Exact name of registrant as specified in its charter)
| Nevada | 001-41266 | 27-3911608 |
|---|---|---|
| (State<br> or other jurisdiction <br><br> of incorporation) | (Commission<br><br> File Number) | (I.R.S.<br> Employer<br><br> Identification No.) |
385South Pierce Avenue, Suite C
Louisville,Colorado 80027
(Address of principal executive offices and zip code)
Registrant’s telephone number, including area code: (303) 993-5271
Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written<br> communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting<br> material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement<br> communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement<br> 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 Exchange Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common<br> Stock, $0.00001 par value | CEAD | Nasdaq<br> Capital Market |
| Warrants<br> to purchase Common Stock | CEADW | Nasdaq<br> 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).
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. ☐
Item8.01 — Other Events
In recent quarters the Company has experienced declining activity due to weakness in the macroeconomic environment of the cannabis market, which is facing increasing competition and declining wholesale prices as consumers become more sophisticated and selective when choosing products. The overall controlled environment agriculture market is also experiencing a fluctuating economy, rising costs, and the fear of recession that is delaying, reducing or eliminating capital projects. Additionally, the Company faces continued supply chain, labor and inflationary issues that are impacting customers’ contract decisions and implementation. As a result, the Company has taken cost saving initiatives to reduce operating expenses and to reduce its workforce so as to preserve working capital and liquidity without compromising the servicing of Company clients.
Item9.01 Financial Statement sand Exhibits
| (a) | Not<br> Applicable |
|---|---|
| (b) | Not<br> Applicable |
| (c) | Not<br> Applicable |
| (d) | Exhibits |
| Exhibit<br> No. | Description |
| --- | --- |
| 99.1 | Press Release dated February 27, 2023, relating to cost saving initiatives |
| 104 | Cover<br> Page Interactive Data File (embedded within the Inline XBRL document) |
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.
| Date:<br> February 27, 2023 | CEA<br> INDUSTRIES INC. | |
|---|---|---|
| By | /s/ Anthony K. McDonald | |
| Anthony<br> K. McDonald | ||
| President<br> and Chief Executive Officer |
Exhibit 99.1
CEA Industries Inc. Announces New Cost Saving Initiatives
Louisville, Colorado, February 27, 2023 — CEA Industries Inc. (NASDAQ: CEAD, CEADW) (“CEA Industries” or the “Company”), today announced cost saving initiatives that include various operating expense reductions and a reduction in force in response to continued macroeconomic and supply chain challenges.
In recent quarters the Company has experienced declining activity due to weakness in the macroeconomic environment of the cannabis market, which is facing increasing competition and declining wholesale prices as consumers become more sophisticated and selective when choosing products. The overall controlled environment agriculture market is also experiencing a fluctuating economy, rising costs, and the fear of recession that is delaying, reducing or eliminating capital projects. Additionally, the Company faces continued supply chain, labor and inflationary issues that are impacting customers’ contract decisions and implementation. At this stage, the Company concluded that a workforce reduction and the implementation of operating expense savings were necessary.
“Today’s announcement is the result of a thorough review of, and diligent planning for, the long-term viability of our company,” said Tony McDonald, Chairman and CEO of CEA Industries Inc. “The decision to downsize our workforce was not taken lightly as we greatly value the contributions of each of our team members.”
“We believe these cost savings will improve both our working capital and liquidity without compromising the outstanding service our customers expect. We will continue to evaluate our operations and will take additional actions as market conditions warrant.”
About CEA Industries Inc.
CEA Industries Inc. (www.ceaindustries.com), is home to industry leaders in supplying the controlled environment agriculture, with complementary and adjacent companies added to its portfolio when aligned with the company’s product and sales initiatives. As the global environment for indoor cultivation continues to develop, CEA Industries was formed to embrace companies that support these ecosystems.
Headquartered in Louisville, Colorado, CEA Industries knows that growth is a team sport. Through future partnerships, CEA Industries will continue its pursuit of companies and products that bring value to its customers.
Media Contact:
Courtney Gwynn
Marketing Manager
courtney.gwynn@surna.com
(720) 531-0311
Investor Contact:
Sean Mansouri, CFA
Elevate IR
info@ceaindustries.com
(720) 330-2829