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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):
August 24, 2023
Creatd, Inc.
(Exact name of registrant as specified in its charter)
Nevada |
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001-39500 |
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87-0645394 |
(State or other jurisdiction of
incorporation or organization) |
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(Commission File Number) |
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(IRS Employer
Identification No.) |
419 Lafayette Street, 6th Floor
New York, NY 10003
(Address of principal executive offices)
(201) 258-3770
(Registrant’s telephone number, including area
code)
(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:
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☐ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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☐ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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☐ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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☐ |
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 |
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Trading Symbol(s) |
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Name of each exchange on which registered |
N/A |
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N/A |
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N/A |
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 7.01 Regulation FD Disclosure.
On August 24, 2023, Creatd,
Inc., a Nevada corporation (the “Company”), published a Shareholder Letter where CEO Jeremy Frommer discussed the Company’s
vision and strategy to create value (the “Letter”). The Letter furnished hereto as Exhibit 99.1, incorporated herein by reference.
The Letter can also be found
on Vocal at https://vocal.media/trader/creatd-ceo-jeremy-frommer-publishes-open-letter-to-shareholders-addressing-declining-stock-values.
The information in Item 7.01
and Item 8.01 to this Current Report on Form 8-K, including Exhibit 99.1 is being furnished and shall not be deemed “filed”
for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section,
nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as expressly set forth
by specific reference in such filing.
Item 8.01 Other Events
The information set forth in Item 7.01 of this Current Report on Form 8-K
is incorporated by reference into this Item 8.01.
Forward-Looking Statements
This Current Report on Form
8-K includes information that may constitute forward-looking statements. These forward-looking statements are based on the Company’s
current beliefs, assumptions and expectations regarding future events, which in turn are based on information currently available to the
Company. By their nature, forward-looking statements address matters that are subject to risks and uncertainties. Forward looking statements
include, without limitation, statements relating to projected industry growth rates, the Company’s current growth rates and the
Company’s present and future cash flow position. A variety of factors could cause actual events and results, as well as the Company’s
expectations, to differ materially from those expressed in or contemplated by the forward-looking statements. Risk factors affecting the
Company are discussed in detail in the Company’s filings with the Securities and Exchange Commission. The Company undertakes no
obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise,
except to the extent required by applicable securities laws.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
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.
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CREATD, INC. |
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Date: August 24, 2023 |
By: |
/s/ Jeremy Frommer |
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Name: |
Jeremy Frommer |
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Title: |
Chief Executive Officer |
Exhibit 99.1
August 24, 2023
Dear Creatd Shareholders,
I am reaching out to address recent developments and concerns related
to Creatd, Inc. As the Chairman and CEO of Creatd, Inc., I understand the weight of responsibility that rests on my shoulders, and I take
all shareholders’ concerns to heart.
I must express my disappointment regarding the performance of our
stock. Despite our consistent efforts and the significant milestones we've achieved, it's evident that the trading price of our stock
does not reflect Creatd’s true potential value. It's disheartening to see that, even after announcing major initiatives like the
Reg CF for our subsidiary Vocal, Inc., external pressures continue to affect our stock price adversely.
We've partnered with esteemed law firms Christian, Smith & Jewell,
LLP, and the cutting-edge firm PULLP, known for their expertise with small and microcap companies. PULLP represents Creatd, Inc., in our
defense against lender, Lind Partners. Additionally, we've collaborated with Share Intel and other niche data groups. Furthermore, we've
established CEOBLOC, an advisory and advocacy group which is ardently charting a course to Congress to champion the cause of retail investors.
In an era where technology swiftly reshapes our environment,
I challenge all government agencies. They are not only tasked with enforcing the law but also with adapting it to these changing times.
Yet, they fall short.
The dedication and hard work of Creatd's team has been nothing short
of exemplary. Yet, it's frustrating to see the value of our stock not reflecting our accomplishments and the momentum we've built over
time.
What is true, is that the stock price reflects a broken funding space
for venture and entrepreneurial minded companies. That was the initial appeal that drew so many innovative companies to the space, the
hope of accessing legitimate financing in the public markets. This opportunity no longer exists. It is due to many factors, including
the nefarious behaviors of many institutional professionals, as well as significant back office loopholes created by advancements in technology
for bad actors to exploit.
Today though, I am writing to everyone, but more directly, to my personal
shareholders because I take our company Creatd, Inc., personally. Shareholders are my family, my friends, and my network.
Last Friday, August 18, 2023, Creatd’s subsidiary Vocal, Inc.,
announced the introduction of a Reg CF (Regulation Crowdfunding) with the strategic intent to raise capital specifically for that entity,
significantly reducing the operating burden on the holding company.
Our vision extends beyond Vocal, Inc. We are strategically expanding
this approach across all Creatd subsidiaries, leading to four distinct entities under the single holding company. This embodies Creatd's
core ambition as a company. I project that by taking in private capital for our four subsidiaries and the plan to spin them off, we will
amplify Creatd, Inc.'s value.
We're in a business cycle where the individual pieces
have greater value than the whole.
With this transformation, Creatd, Inc. will operate with reduced overhead
and foster growth without being tethered to the traditional financing and operational costs. I believe that the genuine value of Creatd’s
common stock will reflect its intrinsic worth, stemming from its achievements and its role as a holding company, where it primarily owns
stakes in businesses, board seats, and advisement without managing their day-to-day operations. Creatd's position is more of an investor
or owner. This encompasses both wholly owned entities and those with partial ownerships, all culminating in what will be four distinct,
influential, and innovative companies.
The majority of shareholders I engage with grasp the rationale behind
our strategy and recognize the immense potential when our vision materializes. I'm aware that a segment of our community is vocally against
any financing that might dilute the company's value. I want to assure everyone that we share common goals. Those wagering against Creatd's
success will soon realize they're facing a challenging ascent.
Here are the steps we are taking to improve shareholder value:
Vocal, Inc. Reg CF: The Reg CF for Vocal, Inc. is set to unlock
the true value of our flagship offering, Vocal. Given that Vocal operates at a cash flow breakeven, comparable metrics suggest a discounted
valuation lies between $60M-$100M. If Creatd, Inc. were to divest just 10% of Vocal, Inc., it could infuse Vocal with $6-10M in capital.
This move would not only reduce the pressure to dilute Creatd, Inc.'s value but also empower Vocal, Inc. to self-finance its operations
and growth.
I encourage you to review and invest in Vocal, Inc.'s Reg CF, as it
is an import component to see parent company Creatd, Inc.'s stock potentially rally. The success of one means the success of the other.
OG Special Dividend: The OG Collection, Inc. dividend is progressing
steadily, and we're gearing up to unveil more specifics. We're targeting September or October to establish a definitive record date. Shareholders
must hold a stake in Creatd, Inc. at least two days before this date. Following this, within a span of 60 days, OG Collection, Inc. shares
will be distributed to shareholders, with further details on the distribution to come. These dividends will take the form of restricted
shares, setting the stage for a Reg CF for OG Collection, Inc. As Creatd's stake dips below 50% post a distribution of a special dividend
in OG Collection, Inc. to current Creatd shareholders, our vision is to take OG Collection public.
Improved Balance Sheet: The strategic move to segment and
privatize key components of our subsidiaries naturally positions us to enhance our capabilities at the parent level, whether it's increased
liquidity to buy back convertible debt or converting debt into equity.
There are always some moments when securing funds for a company is
not just beneficial, but vital, even if it means considering a stock reverse as some of our peers have recently been forced to do. Nonetheless,
I continue to have confidence in some of their business models and their ability to recover by rallying long term investors.
Rest assured though, I remain steadfast in my current commitment to
the anti-dilution alternative strategies that we are pursuing, which do not have me considering a reverse split in any short term horizon.
It would make no sense given the outline of the plan we have discussed. When we are successful, I will certainly do what is necessary
to uplist the surviving holding company to a national exchange. I am optimistic that with the commitment of long term shareholders and
an improving balance sheet that will not require a reverse split.
I wish to convey my profound gratitude for your unwavering trust and
commitment to our leadership team. Your continued support and the invaluable perspectives of our shareholders have been, and will remain,
central in charting the course for our future.
As we move forward, I encourage you to stay engaged with our company,
follow our progress, and continue to provide us with your valuable insights. Together, we are building a brighter future for Creatd, Inc.
and for its shareholders.
Sincerely,
Jeremy Frommer
Chairman and CEO
Creatd, Inc.
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