cbdMD, Inc. Announces Closing of $2.25 Million Series C Preferred Stock Private Placement

Rhea-AI Summary

cbdMD (NYSE American: YCBD) announced on December 19, 2025 the closing of a private placement of 1,000,000 shares of Series C convertible preferred stock for gross proceeds of $2.25 million.

The company expects net proceeds of approximately $2.1 million to be used for working capital, general corporate purposes, and to support strategic initiatives, including expanding distribution of its consumer brands.

The Series C carries a 10% annual dividend and is convertible at the holder's option into common stock at an initial conversion price of $2.25 per share, with anti-dilution protection and rights substantially the same as the company’s Series B preferred.

Positive

• Gross proceeds of $2.25 million raised
• Net proceeds of ~$2.1 million allocated to working capital
• Convertible structure preserves optionality for investors and company

Negative

• 10% annual dividend creates a significant cash yield obligation
• Conversion at $2.25 per share may result in shareholder dilution upon conversion

Key Figures

Gross proceeds $2.25 million Series C Convertible Preferred Stock private placement

Net proceeds approximately $2.1 million Intended for working capital and strategic initiatives

Series C shares issued 1,000,000 shares Aggregate Series C Convertible Preferred Stock

Dividend rate 10% annually Series C Convertible Preferred Stock dividend

Conversion price $2.25 per share Initial Series C conversion price into common stock

Market Reality Check

$1.12 Last Close

Volume Volume 51,692,396 vs 20-day average 30,817,579 (about 1.68x typical activity). high

Technical Price $1.93 is trading above the 200-day MA at $1.13.

Peers on Argus 1 Down

YCBD fell 14.98% while sector peers were mixed and only INM showed downside momentum at -6.59%, pointing to a stock-specific reaction to the preferred stock financing.

Historical Context

Date	Event	Sentiment	Move	Catalyst
Dec 17	Earnings call notice	Neutral	+58.7%	Scheduled call to discuss Q4 and fiscal 2025 financial results.
Dec 17	Earnings call notice	Neutral	+58.7%	Repeat notice for conference call on financial results and progress.
Dec 08	Listing compliance	Positive	+4.7%	Regained full NYSE American compliance and removal of “.BC” flag.
Dec 08	Listing compliance	Positive	+4.7%	Duplicate compliance announcement reinforcing resolved deficiencies.
Nov 21	Prelim results	Positive	-6.7%	Preliminary FY 2025 sales roughly flat with improved net loss profile.

Pattern Detected

Recent news generally aligned with price moves, with a single divergence on preliminary results where shares fell despite improving loss metrics.

Recent Company History

Over the last few months, cbdMD reported preliminary fiscal 2025 results on Nov 21, 2025, showing slightly lower net sales but an improved net loss. It then issued updates on regaining NYSE American compliance on Dec 8, 2025, followed by an earnings call announcement on Dec 17, 2025, which preceded a strong +58.74% move. These steps highlight an ongoing balance-sheet and listing-stability focus, into which today’s Series C preferred private placement fits as another capital-raising action.

Market Pulse Summary

The stock dropped -21.8% in the session following this news. The decline reflects market sensitivity to another round of convertible preferred financing with a 10% dividend and optional conversion at $2.25 per share. A prior private placement on Oct 1, 2025 also coincided with a negative move, and recent insider sales disclosed on Form 4 may add to supply concerns. While the company gains about $2.1 million in net proceeds, investors appear focused on dilution and overhang risks.

Key Terms

convertible preferred stock financial

"1,000,000 shares of Series C Convertible Preferred Stock in consideration"

Convertible preferred stock is a special class of company shares that pays priority, usually fixed, payments to holders and can be exchanged later for a set number of common shares. It matters to investors because it combines steady income and added protection with the chance to share in a company’s upside; think of it as a hybrid between a bond that pays regularly and an option to convert into growth-oriented stock, where the conversion rules influence both potential gains and how much common shareholders’ ownership may be reduced.

private placement financial

"Series C Preferred Stock Private Placement"

A private placement is a way for companies to raise money by selling securities directly to a small group of investors instead of through a public offering. This process is often quicker and less regulated, making it similar to offering a special, exclusive investment opportunity to select individuals or institutions. For investors, it can provide access to unique investment options that are not available on public markets.

securities purchase agreements financial

"entered into securities purchase agreements with institutional investors"

A securities purchase agreement is a legal contract that spells out the terms when a company sells stocks, bonds, or other investment instruments to buyers. It lays out price, how many securities change hands, any promises or protections for each side, and when the sale is completed—like a detailed sales contract for investments. Investors care because it determines ownership stakes, potential dilution, rights attached to the securities, and conditions that affect the company’s future value.

anti-dilution protection financial

"subject to certain anti-dilution protection provisions"

A contract feature that prevents an investor’s ownership percentage from shrinking when a company issues new shares, by automatically adjusting how many shares the investor holds or the price at which their special shares convert into common stock. It matters because it protects the value, voting power and potential future gains of early or preferred investors—like giving extra slices of a pie when the pie gets bigger so your piece stays the same size.

AI-generated analysis. Not financial advice.

CHARLOTTE, N.C., Dec. 19, 2025 /PRNewswire/ -- 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 securities purchase agreements with institutional investors whereby Company issued the investors an aggregate of 1,000,000 shares of Series C Convertible Preferred Stock in consideration of gross proceeds to the Company of $2.25 million. The Company intends to use the net proceeds of approximately $2.1 million for working capital general corporate purposes and support ongoing strategic initiatives. The Series C 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 $2.25 per share, subject to certain anti-dilution protection provisions, with rights and preferences substantially the same as the Company's issued and outstanding Series B Convertible Preferred Stock.

"We are pleased to continue strengthening our balance sheet to assist the Company's ongoing initiatives to expand distribution for its consumer brands, and position cbdMD for sustained profitability," said Ronan Kennedy, Chief Executive Officer and Chief Financial Officer of cbdMD.

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 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

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SOURCE cbdMD, Inc.

FAQ

What did cbdMD (YCBD) announce on December 19, 2025?

cbdMD closed a private placement of 1,000,000 Series C preferred shares for $2.25 million gross proceeds.

How will cbdMD use the $2.25 million raised in the Series C offering?

The company expects to use approximately $2.1 million of net proceeds for working capital, general corporate purposes, and strategic initiatives.

What are the key financial terms of cbdMD's Series C preferred stock (YCBD)?

Series C carries a 10% annual dividend and is convertible at the holder's option at an initial price of $2.25 per share with anti-dilution protection.

Could cbdMD's Series C convertible preferred stock dilute existing YCBD shareholders?

Yes; conversion of Series C into common stock at $2.25 per share may dilute current shareholders if holders convert.

Are the rights of Series C similar to cbdMD's prior preferred shares?

Yes; the Series C shares have rights and preferences substantially the same as the company's outstanding Series B preferred stock.

When did cbdMD complete the private placement for Series C preferred stock?

The company announced the closing on December 19, 2025.