cbdMD, Inc. 10-K

ITEM 1B. UNRESOLVED STAFF COMMENTS.   Not applicable to a smaller reporting company.   ITEM 2. DESCRIPTION OF PROPERTY.   Our headquarters are located in approximately 50,000 square feet in a modern two-story building in Charlotte, North Carolina which we sub-lease under an agreement which began August 1, 2019 and goes through December 2026. The agreement calls for an annual base monthly rent of $76,041 for the first year and escalates 3% annually. We are currently behind in lease payments on our headquarter facility, received a default notice from the landlord in September 2023, and are attempting to renegotiate with the landlord and find another party to sublet or assume our lease.  We also have an 80,000 square foot warehouse in Charlotte, North Carolina under an agreement which began November 2019 and goes through December 2024. The agreement calls for an annual base monthly rent of $34,766, inclusive of monthly TICAM for the first year and the rent escalates 3% annually.  We currently sublet a portion of our warehouse to offset its expense.   16 Table of Contents