Zevia PBC (ZVIA) · Oct 23, 2026 · Share issuance

Zevia preferred-stock investment funds growth but adds control

$20M preferred investment — $15M closed; $5M contingent on FY26 sales and EBITDA

Zevia’s new preferred-stock investment delivers $15 million upfront and raises Q3 guidance, but carries dilution, dividends and investor governance rights.

Zevia is emerging from a two-year cost and distribution reset, trying to turn renewed retail reach into durable growth while approaching adjusted-EBITDA breakeven. Its latest disclosed quarter showed modest sales growth and positive adjusted EBITDA, while full-year 2026 guidance called for $169 million-$173 million of sales and adjusted EBITDA between a $1.0 million loss and $0.5 million profit.

The financing removes near-term balance-sheet pressure, but it is not cheap capital. Zevia received $15 million immediately and can receive another $5 million, with the second tranche dependent on at least $172.5 million of 2026 sales and adjusted EBITDA no worse than negative $3 million. The capital is therefore partly performance-contingent rather than a fully committed $20 million today.

ItemFiling detailFiling source
Initial proceeds$15.0 millionPurchase Agreement / Initial Closing
Potential additional proceeds$5.0 millionPurchase Agreement / Deferred Closing
FY2026 sales condition for second trancheAt least $172.5 millionPurchase Agreement / Tranche 2 Conditions
FY2026 Adjusted EBITDA conditionNo worse than negative $3.0 millionPurchase Agreement / Tranche 2 Conditions
Preferred dividend6.00%, compounding quarterly; generally payable in kindCertificate of Designations
Initial conversion price$1.448 per Class A shareCertificate of Designations
Board impactPurchaser can designate one director while ownership thresholds are metPurchase Agreement
Q3 2026 net-sales outlookApproximately $48 million vs. prior $44 million-$46 millionPress release
Q3 2026 Adjusted EBITDA outlookNegative $0.9 million to negative $1.0 million vs. prior negative $3.0 million to negative $3.5 millionPress release

The operating update is clearly better than Zevia’s prior near-term outlook. Management lifted preliminary Q3 sales above its previous range and narrowed the expected EBITDA loss sharply, suggesting the distribution and cost actions are beginning to show up faster than the prior guidance implied.

The capital comes with meaningful seniority, dilution and investor influence. The preferred stock ranks ahead of common equity, accrues a 6% dividend that can compound into the preferred balance, and converts at $1.448 subject to a 19.99% issuance cap. GP Investments also receives a board-designation right, voting and standstill protections, preemptive rights, and consent rights over major financing, capital-allocation and strategic decisions. 〔0〕 〔1〕

The second tranche creates a useful but demanding 2026 hurdle. The $172.5 million sales threshold is above the company’s prior full-year guidance ceiling of $173 million only by a narrow margin, while the EBITDA test is less demanding than the prior full-year midpoint. That makes the second $5 million reasonably attainable if the improved Q3 trajectory holds, but it also ties additional liquidity to proving the turnaround rather than providing it upfront.

Bottom line: This materially strengthens Zevia’s funding and operating runway while the Q3 update improves the near-term execution story. But the benefit is offset by expensive, senior convertible capital and substantial governance rights, so the event advances the turnaround without being an unambiguous win for existing common shareholders.

What to watch next

Q3 results, November 4, after market close

Original filing on SEC EDGAR

More Zevia PBC news

Zevia preferred-stock investment funds growth but adds control | ZVIA Stock News
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