8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 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) March 14, 2024

cbdMD, INC.

(Exact name of registrant as specified in its charter)

North Carolina	001-38299	47-3414576
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S. Employer Identification No.)

2101 Westinghouse Blvd Suite A, Charlotte, NC 28273

(Address of principal executive offices)(Zip Code)

Registrant's telephone number, including area code: (704) 445-3060

8845 Red Oak Blvd, Charlotte, NC 28217

(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 (see General Instruction A.2. below):

☐         Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐         Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐         Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐         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	Trading Symbol(s)	Name of each exchange on which registered
Common	YCBD	NYSE American
8% Series A Cumulative Convertible Preferred Stock	YCBD PR A	NYSE American

Indicate by check mark whether the registrant is an emerging growth company as defined in 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 checkmark 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 1.01 Entry into a Material Definitive Agreement.

As previously disclosed by cbdMD, Inc. (the “Company”), commencing August 2019 the Company’s executive offices have been located at 8845 Red Oak Blvd, Charlotte, NC (the “Red Oak Facilities”) which we sub-lease under a sublease agreement dated July11, 2019 which expires December 2026 (the “Red Oak Sublease”) and we are currently behind in lease payments on the Red Oak Sublease, receiving a default notice from HSKL, Inc., in September 2023. Effective March 20, 2024 we entered into a License Agreement, dated as of March 14, 2024, by and between cbdMD, Inc. and HSKL, Inc. (the “License Agreement”) and Lease Forbearance Agreement, dated as of March 14, 2024, by and between cbdMD, Inc. and HSKL, Inc. (the “Forbearance Agreement”). Under the License Agreement we have granted HSKL a license to possess and use a portion of the Red Oak Facilities until the earlier of (i) the termination of the Forbearance Agreement and (ii) July 31, 2024 (the “Termination Date”). The termination of the License Agreement will result in termination of the Red Oak Sublease. Pursuant to the Forbearance Agreement HSKL has agreed to forbear from proceeding to exercise its remedies against us under the Red Oak Sublease, and the declaration of default related to past due rent in consideration of the following payments to HSKL: $80,000 upon the execution of the Forbearance Agreement, followed by four monthly payments of $40,000. HSKL’s forbearance shall extend to the Termination Date and HSKL shall dismiss (without prejudice) a Complaint in Summary Ejectment filed in Mecklenburg County, North Carolina on February 27, 2024. In the event of our breach of any of the conditions of the Forbearance Agreement, HSKL’s obligation to forbear shall cease, and HSKL may immediately exercise any and all of its rights or remedies at law, in equity or under the Red Oak Sublease.

Effective March 20, 2024 our executive offices are located at 2101 Westinghouse Blvd Suite A, Charlotte, NC, which facilities have also served as our warehouse facilities since November 2019. The consolidation of our warehouse facilities and executive offices is consistent with management’s efforts to rationalize and right size our expenses across all areas of our business and operations. The new executive office facilities are sufficient to maintain our current operations.

The foregoing description of the terms of the License Agreement and the Forbearance Agreement and the transactions contemplated thereby does not purport to be complete and are qualified in its entirety by reference to the License Agreement and Forbearance Agreement, a copy of which are filed or incorporated by reference as Exhibits 10.1 and 10.2, respectively, to this Current Report on Form 8-K.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit Number	Exhibit
10.1	License Agreement, effective as of March20, 2024, by and between cbdMD, Inc. and HSKL, Inc.
10.2	Lease Forbearance Agreement, dated as of March 14, 2024, by and between cbdMD, Inc. and HSKL, Inc.
104	Cover 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.

	cbdMD, Inc.
Date: March 15, 2024	By:	/s/ T. Ronan Kennedy
		T. Ronan Kennedy, Chief Financial Officer

EX-10.1

Exhibit 10.1

LICENSE AGREEMENT

THIS LICENSE AGREEMENT (this "Agreement"), dated as of March 20, 2024 (the "Effective Date"), is entered into between CBDMD, INC., a North Carolina corporation ("Licensor"), and HSKL, Inc., formerly FREEMANWHITE, INC., a Delaware corporation ("Licensee").

Recitals

1. Licensor is the subtenant of an improved parcel of land which includes an approximately 50,000 square foot commercial building with a street address of 8845 Red Oak Blvd., Charlotte, North Carolina 28217 (the "Property").

2. Licensee desires to occupy so much of the Property not currently being used by the Licensor (the "Licensed Property").

3. Licensor is willing to grant Licensee a license with respect to the Licensed Property on terms and conditions more particularly described below.

Agreement

NOW, THEREFORE, for and in consideration of the mutual promises, covenants and agreements herein contained, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1. Recitals. The foregoing recitals are incorporated by reference as though fully set forth herein.

2. Grant of License. Subject to the terms and conditions set forth in this Agreement, Licensor grants to Licensee a license to possess and use the Licensed Property (the "License") during the Term (as defined below) solely for the purpose of general office use.

3. Term. The term (the "Term") of this Agreement shall commence on the Effective Date and shall terminate on the earlier of (i) the termination of that certain Lease Forbearance Agreement of even date herewith between Licensor and Licensee, and (ii) July 31, 2024 (the "Vacancy Date"). Termination of this Agreement also will result in termination of the Sublease between the parties dated July 11, 2019.

4. Condition of Premises. Licensor shall turn over the Licensed Property to Licensee in good and clean condition with all damages repaired from Licensor’s occupancy, ordinary wear and tear excepted.

5. License Fees. Licensee shall not pay any fee for the occupancy rights granted in this Agreement.

6. Assumption of Risk; Release. Licensee shall use the Licensed Property at its own risk, and Licensee assumes all risk of loss of or damage to its property and equipment, or of personal injury, in its activities upon the Licensed Property. Licensee hereby releases Licensor, its members, officers, agents, employees, successors and assigns to the full extent permitted by law, from all claims of any kind resulting in loss of life, bodily injury or property damage, and arising from Licensee’s use of the Licensed Property.

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7. Compliance with Law. Licensee shall be responsible, at its sole expense, for compliance with all applicable laws, regulations, ordinances, orders, permits and other legal requirements in connection with its activities on the Licensed Property during its possession of the Licensed Property.

8. Liens. Licensee shall be obligated to pay for all services and materials provided in connection with its activities on the Licensed Property and shall promptly cause to be removed of record any lien or claim for lien filed against any property of Licensor in connection with such activities. This obligation shall survive the expiration or earlier termination of this Agreement.

9. Insurance. Throughout the Term, Licensee shall maintain the insurance as required of Tenant by Section 13(c) of the Lease Agreement by and between BBFH Holdings, LLC and FreemanWhite, Inc. dated December 15, 2006.

10. Prorations and Adjustments. Licensee shall pay for all utilities and expenses incurred with respect to the Licensed Property during the Term, including, without limitation, telephone, water, storm and sanitary sewer, electricity, gas, garbage and waste removal.

All city, state and county ad valorem taxes and similar impositions levied or imposed upon or assessed against the Licensed Property (herein called the "Taxes"), for the Term shall be charged to Licensee at the Vacancy Date. In making the prorations required by this Section 10, the economic burdens and benefits of ownership of the Licensed Property for the Vacancy Date shall be allocated to Licensee.

11. Default. If Licensee fails to perform any obligation under this Agreement, and fails to cure the default on the earlier of the expiration of the Term or within three (3) business days after written notice from Licensor, then Licensor shall have the right to terminate this Agreement. In the event of any termination of this Agreement by Licensor, Licensor may also recover all damages to which it may be entitled resulting from that breach at law, in equity or pursuant to this Agreement.

12. Notices. All notices, demands, requests, and other communications required or permitted hereunder shall be in writing. Notices may be provided by counsel to Licensor and Licensee on their behalf. All such notices, demands, requests and other communications (and copies thereof) shall be deemed to be delivered: (a) if sent by messenger, upon personal delivery to the party to whom the notice is directed; (b) if sent by e-mail on (i) the day sent so long as such email notice is sent within business hours on that day (unless a different time period is provided here), or (ii) the next day if sent after business hours on the day sent or sent on a non-business day; (c) if sent by overnight courier, with request for next day delivery, on the next day after sending; or (d) when actually received after deposit in a regularly maintained receptacle for the United States mail, registered or certified, return receipt requested, postage prepaid, addressed as set forth in the signature page of this Agreement (or to such other address as any party may specify by notice given pursuant to this Section12). Any notices, demands, requests and other communications sent via (c) or (d) above shall be also sent via (b) above within one (1) business day after sent via (c) or (d) above, it being understood by the parties hereto that the services used by methods (c) and (d) have been strained lately and delivery times are frequently missed, mailings lost, etc., and the parties desire that notices (or copies thereof) actually be delivered to the intended party.

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13. Assignment. Licensee's rights under this Agreement shall not be assignable or transferable without the prior written consent of Licensor, which may not be unreasonably withheld.

14. Miscellaneous.

a. This Agreement represents the entire agreement between Licensor and Licensee as to the License, and there are no other agreements, terms or conditions that have not been incorporated herein, other than the Lease Forbearance Agreement of even date herewith.

b. This Agreement shall not be modified, revoked, released or terminated, except upon the mutual consent of Licensor and Licensee.

c. This Agreement shall be governed by and interpreted in accordance with the laws of the State of North Carolina.

d. Each party represents and warrants to the other party that it has full right and authority to enter into this Agreement and to perform all its obligations under this Agreement.

e. If any provision of this Agreement, or its application to any party or circumstance, shall be determined by any court of competent jurisdiction to be invalid and unenforceable to any extent, the remainder of this Agreement or the application of such provision to any other party or circumstance, other than those as to which it is so determined invalid or unenforceable, shall not be affected thereby, and each provision hereof shall be valid and shall be enforced to the fullest extent permitted by law. If any date specified in this Agreement for the performance of an obligation, the giving of a notice, or the expiration of a time period falls on a Saturday, Sunday, or bank holiday, then this Agreement shall be automatically revised so that such date falls on the next occurring business day.

f. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original and all of which together shall comprise by one and the same instrument. Documents executed, scanned and transmitted electronically and electronic signatures shall be deemed original signatures for purposes of this Agreement and all matters related thereto, with such scanned and electronic signatures having the same legal effect as original signatures. The parties agree that this Agreement or any other document necessary for the consummation of the transactions contemplated by this Agreement may be accepted, executed or agreed to through the use of an electronic signature in accordance with the Electronic Signatures in Global and National Commerce Act, Title 15, United States Code, Sections 7001 et seq., the Uniform Electronic Transaction Act, and any applicable state law. Any document accepted, executed or agreed to in conformity with such laws will be binding on all parties the same as if it were physically executed and each party hereby consents to the use of any third-party electronic signature capture service providers as may be chosen and utilized by any party.

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g. If either party institutes an action or proceeding relating to or arising out of this Agreement, or the transaction contemplated hereby, or in the event any party is in default of its obligations pursuant hereto and thereto, whether or not suit is filed or prosecuted to final judgment, the prevailing party shall be entitled to reasonable attorneys' fees and to all court costs incurred, in addition to any other damages or relief awarded.

[Signatures on following page]

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IN WITNESS WHEREOF, Licensor and Licensee have executed this License Agreement on the dates set forth below, all being effective as of the Effective Date.

LICENSOR

CBDMD, INC., a North Carolina corporation

By:       ___________________________________
Name:  T. Ronan Kennedy
Title:    Authorized Officer
Date of Licensor's Execution: _______________

Initial address for notices to Licensor:

cbdMD, Inc.
2101 Westinghouse Blvd
Charlotte, NC 28273
E-mail: ronan.kennedy@cbdmd.com
Attn: T. Ronan Kennedy

LICENSEE

HSKL, INC., FORMERLY FREEMANWHITE, INC., a North Carolina corporation

By:       ___________________________________
Name:  ________________
Title:    _____________________
Date of Licensee's Execution:  _______________

Initial address for notices to Licensee:

HSKL, Inc., formerly FreemanWhite, Inc.
111 Riverside Avenue
Jacksonville, FL 32202
E-mail: jeff.miller@haskell.com
Attn: Jeff Miller

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EX-10.2

Exhibit 10.2

LEASE FORBEARANCE AGREEMENT

THIS LEASE FORBEARANCE AGREEMENT ("Agreement") is made and entered into as of _____________ (the "Effective Date") by and between HSKL, Inc., formerly FREEMANWHITE, INC., a Delaware corporation ("Sublandlord"), and CBDMD, INC., a North Carolina corporation ("Subtenant").

Recitals

1. Sublandlord and Subtenant entered into that certain Sublease Agreement dated 7/11/2019 (the "Sublease"), whereby Sublandlord currently leases the following real property to Subtenant: 8845 Red Oak Blvd., Charlotte, North Carolina 28217 (the "Demised Premises").

2. Subtenant acknowledges that it is delinquent in the payment of the installments of both Minimum Rent and Additional Rent due under the Sublease for the period of September 1, 2023 through the Effective Date (the "Delinquent Rent") and said delinquency constitutes an Event of Default under the Sublease.

3. Subtenant has requested, and Sublandlord has agreed, to forbear from exercising its remedies relating to the Sublease in order to allow Subtenant an opportunity to execute and implement a plan to improve its financial condition and repay the Delinquent Rent, and Subtenant is willing to agree to the below terms of this Agreement in an effort to induce Sublandlord to so forbear.

4. Sublandlord has agreed to forbear from exercising its remedies under the Sublease, subject to the terms and conditions of this Agreement.

Agreement

NOW, THEREFORE, in consideration of the premises and mutual covenants and agreements contained herein, the receipt, adequacy and sufficiency of which are hereby acknowledged, Sublandlord and Subtenant hereby agree as follows:

1. Affirmation of Recitals. The Recitals set forth above are true and correct and are incorporated herein by this reference.

2. Forbearance Conditions. In exchange for Sublandlord's agreement to forbear from proceeding to exercise its remedies against Subtenant under the Sublease, and the declaration of default related to the Delinquent Rent that has occurred, Subtenant understands, acknowledges and agrees as follows:

2.1. Subtenant shall make the following electronic payments to Sublandlord: $80,000 upon the full execution of this Agreement, followed by $40,000 payments on April 1, May1, June 1 and July 1, 2024;

2.2. Subtenant, at its sole expense, shall remove its exterior signage from the Demised Premises and repair any resulting damage by March 31, 2024; and

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2.3. Subtenant shall enter into that certain License Agreement of even date herewith licensing Sublandlord's occupancy and use of the Demised Premises until the Forbearance Expiration Date.

2.4. Unless otherwise terminated as allowed herein, this Agreement shall terminate on July 31, 2024 (the "Forbearance Expiration Date").

2.5. Any payment received by Sublandlord will be applied to the delinquency as set forth herein without prejudice to the right of Sublandlord, its successors and/or assigns to proceed with any available remedies against Subtenant where appropriate without sending any notices, demands or acceleration letters in the event that any payment or payments pursuant to this Agreement are not made in a timely manner or in the event that Subtenant fails to comply with any other provision of this Agreement. In the event that any portion of the terms and conditions of this Agreement are not complied with by Subtenant, Sublandlord may immediately proceed with its available remedies under the Sublease including, but not limited to, terminating, without prior notice, Subtenant's right to possession of the Demised Premises, and no funds which have been received by Sublandlord pursuant to this Agreement will be returned.

2.6. Sublandlord's obligation to forbear hereunder is further limited by each of the following:

2.6.1. Sublandlord's forbearance shall extend to the Forbearance Expiration Date and shall include any and all Events of Default that may occur from and after the Effective Date, except for the Subtenant's obligations set forth in this Section 2.

2.6.2. Sublandlord shall dismiss (without prejudice) that certain Complaint in Summary Ejectment filed in Mecklenburg County, North Carolina on February 27, 2024.

In the event of the breach of any of the foregoing conditions by Subtenant, Sublandlord's obligation to forbear shall cease, and Sublandlord may immediately exercise any and all of its rights or remedies at law, in equity or under the Sublease.

3. No Reinstatement. It is expressly understood that by Sublandlord's execution of this Agreement it shall by no means be considered or construed as a waiver of Sublandlord's rights or remedies at law, in equity or under the Sublease upon Subtenant's further default.

4. Further Assurances and Acknowledgment of Parties Regarding Obligations. Sublandlord and Subtenant hereby confirm, renew, and extend the rights, titles, security interests, liens, powers and privileges existing under or by virtue of the Sublease until all of the Subtenant's obligations evidenced by the Sublease have been completed and paid in full. Subtenant and Sublandlord agree that this Agreement shall not in any way or manner release, discharge, affect, change, modify or impair the debts, duties, obligations, liabilities, rights, titles, security interests, liens, powers and privileges existing by virtue of, arising under or in connection with, or relating to the Sublease, the purpose of this Agreement being simply to confirm, renew, extend and modify the full payment of the Delinquent Rent evidenced by the Sublease in accordance with the terms and provisions herein and to continue and carry forward all of the rights, titles, security interests, liens, powers and privileges existing by virtue of the Sublease, each of which are hereby acknowledged by Subtenant and Sublandlord to be legal, valid and subsisting. Sublandlord and Subtenant agree that a modification or amendment of the Sublease is expressly denied and not intended to be effected, and the terms, provisions, conditions, rights, duties and obligations contained in the Sublease shall remain unchanged by this Agreement and in full force and effect.

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5. Legal Counsel. Each party acknowledges that it has been afforded the opportunity to seek the advice of legal counsel in connection with the negotiation and preparation of this Agreement. If a party has chosen not to obtain legal representation, whether due to cost considerations or for other reasons, the lack of such representation shall not furnish such party with any defense to the enforcement of this Agreement by the other party.

6. Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon Sublandlord and Subtenant and their respective successors and assigns.

7. Entire Agreement. This Agreement and the License Agreement contain all of the terms of the agreement between Subtenant and Sublandlord with respect to the subject matter hereof and supersede all prior discussions and agreements between Subtenant and Sublandlord.

8. Severability. In the event any provision of this Agreement shall be held invalid or unenforceable by any court of competent jurisdiction, such holdings shall not affect the validity or enforceability of any other provision hereof.

9. Full Force and Effect / Assigns. Except as expressly modified herein, all terms of the Sublease shall be unchanged and shall remain in full force and effect. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.

10. Governing Law. This Agreement shall be construed in accordance with the laws of North Carolina, without regard to its conflict of law principles, performable and with venue proper within Mecklenburg County, North Carolina.

11. Capitalized Terms. All capitalized terms not defined herein shall have the meanings given to them in the Sublease. In the case of a conflict, the terms of this Agreement shall prevail.

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12. Counterparts; Electronic Copies. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original and all of which together shall comprise one and the same instrument. Documents executed, scanned and transmitted electronically and electronic signatures shall be deemed original signatures for purposes of this Agreement and all matters related thereto, with such scanned and electronic signatures having the same legal effect as original signatures. The parties agree that this Agreement or any other document necessary for the consummation of the transactions contemplated by this Agreement may be accepted, executed or agreed to through the use of an electronic signature in accordance with the Electronic Signatures in Global and National Commerce Act, Title 15, United States Code, Sections 7001 et seq., the Uniform Electronic Transaction Act and any applicable state law. Any document accepted, executed or agreed to in conformity with such laws will be binding on all parties the same as if it were physically executed and each party hereby consents to the use of any third-party electronic signature capture service providers as may be chosen and utilized by any party.

[The next page is the signature page.]

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Executed as of the Effective Date first set forth above.

HSKL, INC., FORMERLY FREEMANWHITE, INC., a North Carolina corporation

By:       _____________________________________
Name:  _____________________________
Title:    Authorized Officer

CBDMD, INC., a North Carolina corporation

By:       _____________________________________
Name:  T. Ronan Kennedy
Title:    Authorized Officer

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XML

Document And Entity Information	Mar. 14, 2024
Document Information [Line Items]
Entity, Registrant Name	cbdMD, INC.
Document, Type	8-K
Document, Period End Date	Mar. 14, 2024
Entity, Incorporation, State or Country Code	NC
Entity, File Number	001-38299
Entity, Tax Identification Number	47-3414576
Entity, Address, Address Line One	2101 Westinghouse Blvd Suite A
Entity, Address, City or Town	Charlotte
Entity, Address, State or Province	NC
Entity, Address, Postal Zip Code	28273
City Area Code	704
Local Phone Number	445-3060
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity, Emerging Growth Company	false
Amendment Flag	false
Entity, Central Index Key	0001644903
Common Custom [Member]
Document Information [Line Items]
Title of 12(b) Security	Common
Trading Symbol	YCBD
Security Exchange Name	NYSEAMER
SeriesACumulativeConvertiblePreferredStock8 Custom [Member]
Document Information [Line Items]
Title of 12(b) Security	8% Series A Cumulative Convertible Preferred Stock
Trading Symbol	YCBD PR A
Security Exchange Name	NYSEAMER