cbdMD, Inc. Announces Closing of $1.7 Million Series B Preferred Private Placement

Rhea-AI Summary

cbdMD (NYSE American: YCBD) has secured a $1.7 million private placement through the issuance of Series B Convertible Preferred Stock to institutional investors, including C/M Capital Master Fund, LP. The company will receive net proceeds of $1.5 million for working capital and strategic initiatives.

The preferred shares feature a 10% annual dividend and are convertible to common stock at $1.00 per share. CEO Ronan Kennedy highlighted that the company will end its fiscal year with over $2.2 million in cash, strengthening their balance sheet and supporting efforts to regain full listing compliance while expanding distribution of their consumer brands.

Positive

• Secured $1.7 million in new funding through preferred stock placement
• Company will end fiscal year with over $2.2 million in cash position
• Strengthens balance sheet to support distribution expansion
• Helps efforts to regain listing compliance

Negative

• Dilutive impact from convertible preferred shares at $1.00 conversion price
• 10% annual dividend requirement creates additional financial obligations
• Company still working to regain listing compliance

Insights

Financial Restructuring Expert

cbdMD secured $1.7M in preferred stock funding to strengthen its balance sheet and support growth initiatives while addressing NYSE compliance concerns.

cbdMD has closed a $1.7 million Series B Convertible Preferred Stock private placement with institutional investors including C/M Capital Master Fund. The company will receive $1.5 million in net proceeds, which will be used for working capital, general corporate purposes, and ongoing strategic initiatives.

This financing serves multiple strategic purposes. First, it strengthens cbdMD's balance sheet, bringing their cash position to more than $2.2 million as they close their fiscal year. Second, it's explicitly aimed at bolstering shareholders' equity, which suggests the company is addressing potential NYSE American listing compliance issues - a critical consideration for maintaining their public status.

The terms of the Series B Preferred Stock include a 10% annual dividend and conversion rights at $1.00 per share. This structure provides immediate capital while potentially diluting existing shareholders if converted to common stock. The company must file a registration statement with the SEC for these potential conversion shares.

CEO Ronan Kennedy's statement indicates this financing is part of a broader strategy to achieve sustained profitability through expanded distribution of their consumer brands, which include Herbal Oasis THC seltzers, ATRx functional mushroom supplements, and Paw CBD. The deliberate timing to secure this funding before fiscal year-end demonstrates management's focus on meeting regulatory requirements while supporting operational needs.

Charlotte, North Carolina--(Newsfile Corp. - October 1, 2025) - cbdMD, Inc. (NYSE American: YCBD), a leading wellness company and the parent of Herbal Oasis THC seltzers, ATRx functional mushroom supplements, and Paw CBD, today announces that it has entered into a securities purchase agreement with institutional investors including C/M Capital Master Fund, LP (the "Investors") whereby Company issued the Investors a Series B Convertible Preferred Stock (the "Shares") in consideration of gross proceeds to the Company of $1.7 million. The Company intends to use the net proceeds of $1.5 million for working capital general corporate purposes and support ongoing strategic initiatives.

"We are pleased to continue strengthening our balance sheet and to finish our fiscal year with more than $2.2 million in cash," said Ronan Kennedy, Chief Executive Officer & Chief Financial Officer of cbdMD. "The board believed it was prudent to bolster our shareholders equity ahead of fiscal year end to assist the Company's ongoing initiatives to expand distribution for its consumer brands, and position cbdMD for sustained profitability and support efforts to regain full listing compliance. This financing supports both our capital structure and our long-term growth strategy."

Pursuant to a Registration Rights Agreement, the Company is required to file a registration statement with the SEC covering shares of common stock issuable upon conversion of the Shares. The Shares have a 10% annual dividend and are convertible at the option of the holder into the Company's common stock at an initial conversion price of $1.00 per share.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy any of the securities described herein, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

About cbdMD, Inc.

cbdMD, Inc. (NYSE American: YCBD) is a leading wellness company offering a comprehensive line of U.S.-produced, hemp-derived cannabinoid products, including CBD, CBG, CBN, and more. Its brands include:

• Herbal Oasis – a hemp-derived THC social seltzer redefining the way people connect, unwind, and celebrate life.
• ATRx Labs – functional mushroom supplements supporting focus, calm, and vitality.
• Paw CBD – one of the most recognized CBD brands for pets.

The Company is committed to quality, innovation, and transparency, with products distributed both online and through retail partners across the United States. To learn more about cbdMD and our comprehensive line of U.S. grown hemp products as well as our other brands, please visit www.cbdmd.com, www.herbaloasis.com, www.pawcbd.com, or ATRxlabs.com, follow cbdMD on Instagram and Facebook, or visit one of the thousands of retail outlets that carry cbdMD's products.

Forward-Looking Statements

This press release contains certain forward-looking statements that are based upon current expectations and involve certain risks and uncertainties within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, including statements regarding profitability and maintaining listing requirements. Such forward-looking statements can be identified using words such as ''should,'' ''may,'' ''intends,'' ''anticipates,'' ''believes,'' ''estimates,'' ''projects,'' ''forecasts,'' ''expects,'' ''plans,'' and ''proposes.'' These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties, and other factors, some of which are beyond our control and difficult to predict. You are urged to carefully review and consider any cautionary statements, including but not limited to expectations on our ability to continue as a going concern, increasing our revenues, the development or future sales of Oasis products, regaining compliance with NYSE American continued listing requirements and other disclosures, including the statements made under the heading "Risk Factors" in cbdMD, Inc.'s Annual Report on Form 10-K for the fiscal year ended September 30, 2024 as filed with the Securities and Exchange Commission (the "SEC") on December 17, 2024, and our other filings with the SEC. All forward-looking statements, including, involve significant risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements, many of which are generally outside the control of cbdMD, Inc. and are difficult to predict. cbdMD, Inc. does not undertake any duty to update any forward-looking statements except as may be required by law. The information which appears on our websites and our social media platforms, including, but not limited to, Instagram and Facebook, is not part of this press release.

Contact Information:

cbdMD, Inc.
Ronan Kennedy
Chief Executive Officer and Chief Financial Officer
IR@cbdmd.com
(704) 445-3064

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/268786

FAQ

How much did cbdMD (YCBD) raise in their Series B Preferred Stock offering?

cbdMD raised $1.7 million in gross proceeds through a Series B Convertible Preferred Stock private placement, with net proceeds of $1.5 million.

What are the terms of cbdMD's Series B Preferred Stock offering?

The Series B Preferred Stock includes a 10% annual dividend and is convertible into common stock at an initial conversion price of $1.00 per share.

How will cbdMD (YCBD) use the proceeds from the preferred stock placement?

cbdMD will use the net proceeds of $1.5 million for working capital, general corporate purposes, and to support ongoing strategic initiatives for brand distribution expansion.

What is cbdMD's cash position after the Series B preferred placement?

According to CEO Ronan Kennedy, cbdMD will finish its fiscal year with more than $2.2 million in cash.

Who are the investors in cbdMD's Series B preferred stock offering?

The preferred stock was issued to institutional investors, including C/M Capital Master Fund, LP.