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Item 9A. Controls and Procedures

2025-03-05 compared with 2024-02-29 · 117 added, 93 removed, 226 unchanged (48% of the section changed)

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Evaluation of Disclosure Controls and Procedures

Our management, with the participation and supervision of our Chief Executive Officer and our Chief Financial Officer, have evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) as of the end of the period covered by this Annual Report on Form 10-K.

Our management, with the participation and supervision of our Chief Executive Officer and our Chief Financial Officer, have evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Annual Report on Form 10-K.

Based upon that evaluation, the Company's management, including the Chief Executive Officer and the Chief Financial Officer, concluded that the Company’s disclosure controls and procedures were effective for the period covered by this Annual Report on Form 10-K.

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Changes in Internal Controls over Financial Reporting

There were no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) that occurred during the period covered by this Annual Report on Form 10-K that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

There were no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) and Rule 15d-15(f) of the Exchange Act) that occurred during the period covered by this Annual Report on Form 10-K that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

OTHER INFORMATION

During the three months ended December 31, 2023, no director or officer of the Company adopted, modified or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

(a) On February 28, 2025, Richard D.

Moss, a non-employee director of the Company, tendered his resignation from the Company’s board of directors to be effective as of immediately prior to the Company’s 2025 Annual Meeting of Stockholders, which has been accepted by the board of directors.

Moss did not resign as a result of any disagreement with the Company on any matter relating to the Company’s operations, policies or practices.

(b) During the year ended December 31, 2024, no director or officer of the Company adopted , modified or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

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DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The information required by this Item will be included in the 2024 Proxy Statement and is incorporated herein by reference.

The following table sets forth the name and position of each of our executive officers and directors as of February 29, 2024.

Name Position

William Toler Chairman of the Board and Chief Executive Officer

John Lindeman Executive Vice President and Chief Financial Officer

Kevin O'Brien Chief Accounting Officer

Mark Parker Executive Vice President

Except as set forth below, the information required by this Item will be included in the 2025 Proxy Statement and is incorporated herein by reference.

The following table sets forth the name, age, and position of each of our executive officers and directors as of March 5, 2025.

Name Age Position

John Lindeman 55 Chief Executive Officer and Principal Executive Officer

Mark Parker 65 President

Kevin O'Brien 45 Chief Financial Officer

Erica Ackerman 49 Chief Accounting Officer

William Toler 65 Executive Chairman of the Board of Directors

Patrick Chung 35 Director

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Melisa Denis 61 Director

William Toler, Chairman of the Board and Chief Executive Officer

Toler has served as our Chairman of our board of directors and Chief Executive Officer since January 1, 2019.

Prior to joining Hydrofarm in 2019, Mr.

Toler was the Chief Executive Officer of Hostess Brands, Inc.

TWNK) ("Hostess"), a food and beverage company, from April 2014 to March 2018.

Under his leadership, Hostess successfully re-established the iconic Hostess brand as a leader within the sweet baked goods category, returned the company to profitability and transitioned Hostess from a private to public company.

Toler has over 35 years of executive leadership experience in supply chain management and consumer packaged goods, including previously having served as Chief Executive Officer of AdvancePierre Foods, from September 2008 to August 2013, and President of Pinnacle Foods.

He has also held executive roles at Campbell Soup Company (NYSE:

CPB), Nabisco, and Procter & Gamble (NYSE:

Toler served on the board of directors of Collier Creek Holdings from September 2018 to September 2020, Hostess Brands from May 2014 to March 2018, AdvancePierre Foods from 2008 to 2013 and Pinnacle Foods from 2007 to 2008.

In addition, Mr.

Toler has also served as a senior advisor at Oaktree Capital Management, an investment management firm, from September 2013 to April 2014.

Toler holds a B.A.

in Business Management and Economics from North Carolina State University.

John Lindeman, Chief Financial Officer

Lindeman has served as our Executive Vice President since August 2022 and Chief Financial Officer since March 2020.

From August 2015 until assuming his current role at Hydrofarm in March 2020, Mr.

John Lindeman, Chief Executive Officer and Principal Executive Officer

Lindeman has served as our Chief Executive Officer and Principal Executive Officer since January 2025.

Lindeman had served as the Company’s Executive Vice President since August 2022 and Chief Financial Officer since March 2020.

From August 2015 until assuming his role at Hydrofarm in March 2020, Mr.

Lindeman served as Chief Financial Officer and Corporate Secretary at Calavo Growers, Inc.

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Prior to joining Legg Mason, he was a Manager at PricewaterhouseCoopers LLP from August 1996 to October 1999.

Lindeman has also served as a director of Utz Brands, Inc.

UTZ) since September 2020.

Lindeman is a Chartered Financial Analyst and holds a B.S.

in Business Administration from the University of Mary Washington.

Kevin O’Brien, Chief Accounting Officer

O’Brien has served as our Chief Accounting Officer since March 2022.

Prior to joining Hydrofarm, Mr.

O’Brien served as the Chief Accounting Officer of CPI Card Group Inc.

PMTS) since April 2018.

O’Brien previously

served as the Director of Corporate Accounting and SEC Reporting at the same company from March 2016 until April 2018.

O’Brien has 20 years of accounting experience, including serving as a Senior Audit Manager at Deloitte & Touche LLP.

O’Brien is a Colorado Certified Public Accountant and received a Bachelor of Science in Business with an Emphasis in Accounting from University of Colorado and a Master of Science with an Emphasis in Accounting from the same institution.

Mark Parker, Executive Vice President

Parker has served as our Executive Vice President since February 2022.

Lindeman currently serves as a director of both Utz Brands, Inc.

UTZ), a position he has held since September 2020, and Calavo where he has served since June 2024.

Lindeman is a Chartered Financial Analyst and holds a Bachelor of Science in Business Administration from the University of Mary Washington.

Mark Parker, President

Mark Parker has served as our President since January 2025.

Parker had served as the Company’s Executive Vice President of Sales and Business Development since February 2022.

Parker has over 30 years of experience in sales and marketing, and leading complex integration projects in multiple industries, in particular with consumer packaging goods.

From May 2019 until February 2022, Mr.

Parker served as our Senior Vice President of Business Development.

Parker served as the Company’s Senior Vice President of Business Development.

Prior to joining Hydrofarm, Mr.

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CPB), where he introduced innovative initiatives as “Soup to Go” (convenience in a package) and iQ Shelf, an in-store approach to simplify consumer shopping experience and drive mutual share growth.

Parker holds a B.S.

in Economics from Wingate University.

Peters, Director

Peters has served as our director since November 10, 2020.

Previously, she was the Senior Vice President of Human Resources for General Electric Company (“GE”) (NYSE:

GE) from July 2013 until December 2017 after which she retired following 38 years of service.

In her role as Chief Human Resource Officer (“CHRO”), Ms.

Peters was a member of GE’s senior leadership team.

From 2001 to 2007 Ms.

Peters served as GE’s Vice President of Executive Development and served as Chief Learning Officer since 2007.

In her role as the CHRO, Ms.

Peters oversaw all aspects of the Human Resource function for GE’s workforce of approximately 325,000 employees in 175 countries.

She was responsible for all of GE’s talent acquisition, talent development, learning, compensation and benefits, payroll, union relations, and security.

Approximately 5,000 human resource employees worked under her leadership.

Peters was first appointed as an officer at GE in 1997.

Peters was a founding member of the GE Women’s Network and was also a member of the GE Foundation Board and the GE Pension Board.

Peters also served on the National Board of Directors of Girl Scouts of the USA from 2008 until 2017.

She is currently a member of the Loews Corporation (NYSE:

L) board of directors.

Peters received her B.A.

Mary’s College, Notre Dame and her Masters in Education from the University of Virginia.

Peters was selected to serve on our board of directors because of her expertise in leadership and development and her experience serving as an officer of a global industrial company.

Parker holds a Bachelor of Science in Economics from Wingate University.

Kevin O’Brien, Chief Financial Officer

O’Brien has served as our Chief Financial Officer since January 2025.

O’Brien had served as the Company’s Chief Accounting Officer since March 2022.

Prior to joining Hydrofarm, Mr.

O’Brien served as the Chief Accounting Officer of CPI Card Group Inc.

PMTS) since April 2018.

O’Brien previously served as the Director of Corporate Accounting and SEC Reporting at the same company from March 2016 until April 2018.

O’Brien has over 20 years of accounting experience, including serving as a Senior Audit Manager at Deloitte & Touche LLP.

O’Brien is a Colorado Certified Public Accountant and received a Bachelor of Science in Business with an emphasis in Accounting from University of Colorado and a Master of Science with an emphasis in Accounting from the same institution.

Erica Ackerman, Chief Accounting Officer

Ackerman has served as our Chief Accounting Officer since January 2025 and Corporate Controller since March 2023.

Ackerman had served as Assistant Controller from March 2021 to March 2023.

Prior to joining Hydrofarm, Ms.

Ackerman spent over 14 years at McKesson Corporation, including as Director of Global Corporate Reporting from June 2018 to July 2020 and as Senior Manager of Technical Accounting from January 2013 to June 2018.

Ackerman is a California Certified Public Accountant and earned her Bachelor of Business Administration from the University of Washington Foster School of Business.

William Toler, Executive Chairman of the Board of Directors

Toler has served as our Executive Chairman of our board of directors since January 2025.

Toler had served as our Chief Executive Officer since January 1, 2019, until his appointment to office of Executive Chairman.

Prior to joining Hydrofarm in 2019, Mr.

Toler was the Chief Executive Officer of Hostess Brands, Inc.

TWNK) ("Hostess"), a food and beverage company, from April 2014 to March 2018.

He has also held executive roles at Campbell Soup Company (NYSE:

CPB), Nabisco, and Procter & Gamble (NYSE:

In addition, Mr.

Toler has also served as a senior advisor at Oaktree Capital Management, an investment management firm, from September 2013 to April 2014.

Toler holds a B.A.

in Business Management and Economics from North Carolina State University.

Patrick Chung, Director

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Chung was selected to serve on our board of directors because of his expertise in financial accounting and investment management.

Peters, Director

Peters has served as our director since November 10, 2020.

Previously, she was the Senior Vice President of Human Resources for General Electric Company (“GE”) (NYSE:

GE) from July 2013 until December 2017 after which she retired following 38 years of service.

In her role as Chief Human Resource Officer (“CHRO”), Ms.

Peters was a member of GE’s senior leadership team.

From 2001 to 2007 Ms.

Peters served as GE’s Vice President of Executive Development and served as Chief Learning Officer since 2007.

In her role as the CHRO, Ms.

Peters oversaw all aspects of the Human Resource function for GE’s workforce of approximately 325,000 employees in 175 countries.

She was responsible for all of GE’s talent acquisition, talent development, learning, compensation and benefits, payroll, union relations, and security.

Approximately 5,000 human resource employees worked under her leadership.

Peters was first appointed as an officer at GE in 1997.

Peters was a founding member of the GE Women’s Network and was also a member of the GE Foundation Board and the GE

Pension Board.

Peters also served on the National Board of Directors of Girl Scouts of the USA from 2008 until 2017.

She is currently a member of the Loews Corporation (NYSE:

L) board of directors.

Peters received her B.A.

Mary’s College, Notre Dame and her Masters in Education from the University of Virginia.

Peters was selected to serve on our board of directors because of her expertise in leadership and development and her experience serving as an officer of a global industrial company.

Renah Persofsky, Director

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OSIX) (f/k/a K.B.

Recycling Industries Ltd.) since April 2021.

Recycling Industries Ltd.) from April 2021 to January 2025.

Persofsky has also previously served as an executive consultant to many iconic brands including Tim Hortons, Canadian Tire (OTCMKTS:

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Persofsky previously co-chaired the Canadian Minister’s Advisory Committee on Electronic Commerce, as well as served as a special advisor to the Minister of Foreign Affairs and Trade.

Persofsky received her degree from the Rotman School of Management at the University of

Persofsky received her degree from the Rotman School of Management at the University of Toronto.

Persofsky was selected to serve on our board of directors because of her global business and e-commerce expertise, and her experience with the cannabis industry.

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Moss also previously served as a senior advisor to Nexo Capital Partners from January 2018 until December 2020.

Moss has served as a director of Winnebago Industries, Inc.

Moss served as a director of Winnebago Industries, Inc.

WGO), a leading U.S.

recreational vehicle manufacturer since February 2017 and has served as a director of Nature’s Sunshine Products, Inc.

recreational vehicle manufacturer from February 2017 through December 2024, and has served as a director of Nature’s Sunshine Products, Inc.

NATR) since May 2018.

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333-250037), filed with the SEC on November 12, 2020).

3.4 Certificate of Amendment to the Amended and Restated Certificate of Incorporation of Hydrofarm Holdings Group, Inc.

(incorporated by reference to the Company’ Current Report on Form 8-K (File No.

001-39773) filed with the SEC on February 18 , 2025.

3.5 Amended and Restated Bylaws (incorporated by reference to the Company’s Registration Statement on Form S-1/A (File No.

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4.2* Description of Capital Stock.

(incorporated by referenced to Exhibit 4.2 to the Company's Annual Report on Form 10-K filed with the SEC on March 9, 2023).

Exhibit Description

10.1 Credit Agreement, dated March 29, 2021, by and among Hydrofarm Holdings Group, Inc., Hydrofarm, LLC, and JPMorgan Chase Bank, N.A.

(incorporated by referenced to Exhibit 10.38 to the Company's Annual Report on Form 10-K filed with the SEC on March 30, 2021).

Exhibit Description

10.2+ First Amendment and Joinder to Credit Agreement, dated as of August 31, 2021, by and among Hydrofarm Holdings Group, Inc., Hydrofarm, LLC, Hydrofarm Investment Corp., Hydrofarm Holdings LLC, EHH Holdings LLC, Sunblaster LLC, Hydrofarm Canada, LLC, Sunblaster Holdings ULC, Eddi’s Wholesale Garden Supplies Ltd., Field 16, LLC, House & Garden, Inc., Humboldt Wholesale, Inc., Aurora Innovations, LLC, House & Garden Holdings, LLC, Gotham Properties LLC, Aurora International, LLC, Allied Imports & Logistics, Inc., Aurora Peat Products ULC, Greenstar Plant Products Inc., the lenders party thereto and JPMorgan Chase Bank, N.A.

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10.6 Fifth Amendment to Credit Agreement, dated March 31, 2023, by and among Hydrofarm Holdings Group, Inc., Hydrofarm, LLC, Field 16, LLC, Innovative Growers Equipment, Inc., Manufacturing & Supply Chain Services, Inc., Hydrofarm Investment Corp., Hydrofarm Holdings LLC, EHH Holdings, LLC, Sunblaster LLC, Hydrofarm Canada, LLC, Sunblaster Holdings ULC, Eddi’s Wholesale Garden Supplies Ltd., House & Garden Holdings, LLC, Gotham Properties LLC, Aurora International, LLC, Aurora Peat Products ULC, Greenstar Plant Products Inc., Innovative AG Installation, Inc., Innovative Racking Systems, Inc., Innovative Shipping Solutions, Inc., Innovative Growers Equipment Canada, Inc., JPMorgan Chase Bank, N.A., as lender, and JPMorgan Chase Bank, N.A., as administrative agent (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed with the SEC on April 6, 2023).

10.7 Sixth Amendment to Credit Agreement, dated November 1, 2024, by and among Hydrofarm Holdings Group, Inc., Hydrofarm, LLC, Field 16, LLC, Innovative Growers Equipment, Inc., Manufacturing & Supply Chain Services, Inc., Hydrofarm Investment Corp., Hydrofarm Holdings LLC, EHH Holdings, LLC, Sunblaster LLC, Hydrofarm Canada, LLC, Sunblaster Holdings ULC, Eddi’s Wholesale Garden Supplies Ltd., House & Garden Holdings, LLC, Aurora International, LLC, Aurora Peat Products ULC, Greenstar Plant Products Inc., Innovative AG Installation, Inc., Innovative Racking Systems, Inc., Innovative Shipping Solutions, Inc., Innovative Growers Equipment Canada, Inc., and JPMorgan Chase Bank, N.A., as lender and administrative agent (incorporated by reference to Exhibit 10.5 of the Company’s Quarterly Report on Form 10-Q filed with the SEC on November 7, 2024).

10.8+ Credit and Guaranty Agreement, dated as of October 25, 2021, by and among Hydrofarm Holdings Group, Inc., the other credit parties party thereto, the lenders party thereto and JPMorgan Chase Bank, N.A.

(incorporated by reference to Exhibit 10.3 of the Company’s Quarterly Report on Form 10-Q filed with the SEC on November 15, 2021).

Exhibit Description

10.9 Amendment No.

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333-250037), filed with the SEC on November 12, 2020).

Exhibit Description

10.12** Offer Letter, dated February 26, 2020, by and between Hydrofarm Holdings Group, Inc.

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10.18** Form of Hydrofarm Holdings Group, Inc.

2020 Equity Incentive Plan Stock Option Notice (incorporated by reference to the Company’s Registration Statement on Form S-1/A (File No.

333-250037), filed with the SEC on December 1, 2020).

2020 Equity Incentive Plan Stock Option Grant Notice (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed with the SEC on May 14, 2024).

10.19** Form of Hydrofarm Holdings Group, Inc.

2020 Equity Incentive Plan Restricted Stock Unit Grant Notice (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed with the SEC on May 14, 2024).

10.20** Form of Hydrofarm Holdings Group, Inc.

2020 Equity Incentive Plan Performance Stock Unit Grant Notice (incorporated by reference to Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q filed with the SEC on May 14, 2024) .

10.21 Form of Indemnification Agreement (incorporated by reference to the Company’s Registration Statement on Form S-1 (File No.

333-250037), filed with the SEC on November 12, 2020).

10.19** Form of Restricted Stock Unit Award Agreement under the 2020 Employee, Director and Consultant Equity Incentive Plan (incorporated by referenced to Exhibit 10.6 to the Company's Annual Report on Form 10-K filed with the SEC on March 30, 2022).

10.22** Non-Employee Director Compensation Policy (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed with the SEC on August 13, 2021)

10.23+ Purchase Agreement, dated May 10, 2024, by and between Hydrofarm Holdings Group, Inc.

and CM Fabrication, LLC (incorporated by reference to Exhibit 10.4 of the Company’s Quarterly Report on Form 10-Q filed with the SEC on August 8, 2024).

19.1* Insider Trading Policy

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Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

97.1 Clawback Policy

97.1 Clawback Policy (incorporated by reference to Exhibit 97.1 of the Company’s Annual Report on Form 10-K (File No.

001-39773) filed with the SEC on February 29, 2024).

INS Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

Exhibit Description

101.SCH Inline XBRL Taxonomy Schema Linkbase Document.

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Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, and shall not be deemed "filed" by the Company for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section, nor shall they be deemed incorporated by reference into any filing of the Registrant under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

+ Certain schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K.

A copy of any omitted schedule and/or exhibit will be furnished to the Securities and Exchange Commission upon request.

† Certain confidential portions (indicated by brackets and asterisks) have been omitted from this exhibit.

+ In accordance with Item 601(b)(10)(iv) of Regulation S-K, certain information (indicated by “[***]”) has been excluded from this exhibit because it is both not material and private or confidential.

A copy of the omitted portion will be furnished to the Securities and Exchange Commission upon request.

Additionally, certain schedules and exhibits have been omitted from this filing pursuant to Item 601(a)(5) of Regulation S-K.

A copy of any omitted schedule or exhibit will be furnished to the Securities and Exchange Commission upon request.

FORM 10-K SUMMARY

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Hydrofarm Holdings Group, Inc.

February 29, 2024

/s/ William Toler

William Toler

March 5, 2025

John Lindeman

Chief Executive Officer

2 unchanged sentences

Signatures Title Date

/s/ William Toler Chief Executive Officer and Chairman of the Board February 29, 2024

William Toler ( Principal Executive Officer )

John Lindeman Chief Financial Officer February 29, 2024

John Lindeman ( Principal Financial Officer )

/s/ Kevin O'Brien Chief Accounting Officer February 29, 2024

Kevin O'Brien ( Principal Accounting Officer )

/s/ Susan Peters February 29, 2024

John Lindeman Chief Executive Officer March 5, 2025

John Lindeman ( Principal Executive Officer )

/s/ Kevin O'Brien Chief Financial Officer March 5, 2025

Kevin O'Brien ( Principal Financial Officer )

/s/ Erica Ackerman Chief Accounting Officer March 5, 2025

Erica Ackerman ( Principal Accounting Officer )

/s/ William Toler Executive Chairman of the Board of Directors March 5, 2025

William Toler

/s/ Susan Peters March 5, 2025

Susan Peters Director

/s/ Patrick Chung February 29, 2024

/s/ Patrick Chung March 5, 2025

Patrick Chung Director

/s/ Renah Persofsky February 29, 2024

/s/ Renah Persofsky March 5, 2025

Renah Persofsky Director

/s/ Richard D.

Moss February 29, 2024

Moss March 5, 2025

Moss Director

/s/ Melisa Denis February 29, 2024

/s/ Melisa Denis March 5, 2025

Melisa Denis Director

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures