In a regulatory filing, cbdMD disclosed that on March 2, the company and Keystone Capital Partners entered into a common stock purchase agreement, which provides that subject to the terms and conditions set forth therein, the company may sell to Keystone up to 12,687,012 shares of common stock of the company from time to time during the term of the purchase agreement. Additionally, on March 2, the company and Keystone entered into a registration rights agreement, pursuant to which the company agreed to file a registration statement with the Securities and Exchange Commission covering the resale of shares of common stock that are issued to Keystone under the purchase agreement. Under the terms and subject to the satisfaction of the conditions set forth in the purchase agreement, the company has the right, but not the obligation, to sell to Keystone, and Keystone is obligated to purchase, up to 12,687,012 shares of common stock. Such sales of common stock by the company, if any, will be subject to certain limitations as set forth in the purchase agreement, and may occur from time to time, at the company’s sole discretion, over a 12-month period commencing on the date that all of the conditions to the company’s right to commence such sales are satisfied, including that the registration statement referred to above is declared effective by the SEC and a final form of the prospectus included therein is filed with the SEC. Keystone has no right to require the company to sell any common stock to Keystone, but Keystone is obligated to make purchases as the company directs, subject to satisfaction of the conditions set forth in the purchase agreement. Upon entering into the purchase agreement, the company agreed to issue to Keystone 392,382 shares of common stock as consideration for Keystone’s commitment to purchase shares of common stock upon the company’s direction under the purchase agreement. The company issued 30% of the commitment shares effective on the date of the purchase agreement. An additional 30% of the commitment shares shall be issued to Keystone 90 days following the commencement date. The remaining 40% of the commitment shares shall be issued to Keystone 180 days following the commencement date. The company also agreed to pay Keystone up to $35,000 for its reasonable expenses under the purchase agreement.
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