Cingulate Inc. 8-K

What Happened

• Cingulate Inc. filed an 8-K reporting that on January 27, 2026 it entered a securities purchase agreement for a private placement expected to close on or before February 2, 2026. The transaction will raise approximately $12.0 million in gross proceeds through the sale of common stock, Series A convertible preferred stock and warrants. Purchasers include certain officers, directors and affiliates of the company.
• The Securities: 2,147,471 shares of common stock; 973 shares of Series A convertible preferred stock (stated value $1,000 per share) with a conversion price of $5.04 per common share (conversion effective only after stockholder approval); and warrants to purchase 1,868,482 common shares. The warrants were sold at $0.10 per warrant share and have an exercise price of $5.04 per common share.

Key Details

• Aggregate gross proceeds: approximately $12,000,000. Price per common share in the deal: $5.14 (includes $0.10 attributable to each warrant share).
• Series A preferred: 973 shares, stated value $1,000 each, cumulative preferential dividend of 12.0% per annum payable yearly in arrears (Dec 15), limited/no voting rights; preferred auto-converts to common upon stockholder approval at $5.04 conversion price (plus accrued unpaid dividends).
• Warrants: 1,868,482 Warrant Shares; sold at $0.10 per share; exercise price $5.04; warrants and warrant shares transferable without company consent.
• Governance and transfer restrictions: Falcon Creek (on behalf of certain purchasers) may designate up to two directors (one at closing, one after stockholder approval). One Falcon Creek director must resign if Falcon Creek-managed holders fall below 15% beneficial ownership; the second must resign if holdings fall below 5%. Purchasers are subject to a 180-day lock-up after the agreement and a 24-month standstill limiting acquisitions above 40% and other control actions.
• Registration: Company will file a resale registration statement within 60 days of closing (subject to exceptions) and use commercially reasonable efforts to have it declared effective; securities currently unregistered and sold under exemptions.

Why It Matters

• Dilution and capital: The financing will increase shares outstanding and could dilute current holders, but provides about $12M of cash for working capital and general corporate purposes. Warrants and convertible preferred shares could convert or be exercised into additional common stock, increasing potential dilution.
• Board influence: Falcon Creek’s right to designate up to two directors (potentially two of seven directors after stockholder approval) is a material governance change that could affect strategy and oversight.
• Cash vs. cost: The preferred carries a 12% cumulative dividend and converts at $5.04, terms that affect the long-term economics of the deal relative to straight equity. The lock-up and standstill reduce immediate resale and activist risks but also limit purchaser actions for set periods.
• Liquidity of securities: Securities were issued in a private placement and are not registered; the company will seek to register resale, which—if completed—would improve liquidity for those securities.