8-K: Sky Quarry Launches $4.7M At-The-Market Equity Offering

Sky Quarry Inc. has entered into an 'at-the-market' equity offering agreement with Cantor Fitzgerald & Co. to sell up to $4.7 million of common stock.

Summary

• Sky Quarry Inc. (the "Company") entered into a Controlled Equity Offering SM Sales Agreement (the "Sales Agreement") with Cantor Fitzgerald & Co. (the "Agent") on January 12, 2026.
• The agreement allows the Company to offer and sell shares of its common stock, par value $0.0001 per share, through the Agent, with an aggregate sales price of up to $4,700,000 (the "ATM Offering").
• The Agent will use commercially reasonable efforts to sell the shares from time to time, based on the Company's instructions.
• The Agent will receive a commission of up to 3.0% of the gross proceeds from each sale.
• Sales will be made in transactions deemed 'at the market offerings' as defined in Rule 415 under the Securities Act of 1933.
• The Company has no obligation to sell any shares and may suspend or terminate the agreement at any time.
• The shares will be issued and sold pursuant to the Company's shelf registration statement on Form S-3 (File No. 333-291721), which became effective on December 18, 2025.
• A prospectus supplement was filed with the SEC on January 12, 2026, in connection with the ATM Offering.

Sentiment

Score: 6

Explanation: The sentiment is moderately positive. While it introduces potential dilution, it provides the Company with a flexible and efficient means to raise capital, which is generally a positive for financial stability and growth initiatives. The amount is not excessively large, suggesting a measured approach to capital management.

Positives

• Provides the Company with a flexible and efficient mechanism to raise capital as needed, potentially at favorable market prices.
• Allows the Company to access capital without the need for a traditional underwritten offering, which can be more costly and time-consuming.
• The Company retains control over the timing and amount of sales, with no obligation to sell any shares.

Negatives

• Potential for dilution of existing shareholders as new shares are sold into the market.
• The 'at-the-market' nature means sales prices are subject to market fluctuations, which could impact the average price received for the shares.
• The Agent is entitled to a commission of up to 3.0% of gross proceeds, reducing the net capital raised by the Company.

Risks

• Market conditions may not be favorable for selling shares, potentially limiting the Company's ability to raise the full $4.7 million or requiring sales at lower prices.
• The Agent's obligation is to use 'commercially reasonable efforts,' meaning there is no guarantee that any specific number of shares will be sold.
• Future sales of common stock under the ATM Offering could create downward pressure on the Company's stock price due to increased supply.
• The Company must maintain compliance with SEC and Nasdaq listing requirements, and any failure could impact the offering.

Future Outlook

The Company may offer and sell shares of its common stock from time to time through the Agent, based on its instructions. There is no obligation to sell any shares, and the Company can suspend or terminate the offering at any time. The proceeds will be used as described in the prospectus, typically for general corporate purposes.

Management Comments

• Marcus Laun, President, Interim Chief Executive Officer, and Interim Chief Financial Officer, signed the Form 8-K on behalf of Sky Quarry Inc.

Industry Context

At-the-market (ATM) offerings are a common financing tool for publicly traded companies, particularly those with smaller market capitalizations or those seeking to raise capital opportunistically without the market disruption of a large, fixed-price offering. This allows companies to tap into equity markets gradually, often when their stock price is favorable, aligning with broader industry trends of flexible capital management.

Comparison to Industry Standards

• The commission rate of up to 3.0% for the ATM offering is within the typical range for such agreements, which can vary based on company size, market conditions, and agent involvement.
• The use of a Form S-3 shelf registration statement is standard practice for established public companies to facilitate efficient, 'at-the-market' offerings.
• The maximum offering amount of $4.7 million is relatively modest, suggesting a targeted capital raise for specific operational needs or to bolster working capital, rather than a transformative financing event.

Corporate Governance

Legal Proceedings

• The Company represents that there are no actions, suits, or proceedings by or before any Governmental Authority pending or threatened that would have a Material Adverse Effect, nor any audits or investigations by or before any Governmental Authority to which the Company or a Subsidiary is a party or subject.

Stakeholder Impact

• Shareholders: Potential for dilution of existing shareholdings as new common stock is issued and sold, which could impact earnings per share and ownership percentage.
• Company: Enhanced financial flexibility and access to capital for general corporate purposes, working capital, or potential strategic initiatives.
• Creditors: A stronger balance sheet from capital infusion could improve the Company's credit profile, though the immediate impact is likely minimal given the offering size.

Next Steps

• The Company may, from time to time, issue Placement Notices to Cantor Fitzgerald & Co. to initiate sales of common stock under the ATM Offering.
• The Company will file prospectus supplements and other required reports with the SEC detailing any sales made under the agreement.
• The Company will continue to comply with all applicable securities laws and exchange rules related to the offering and its ongoing reporting obligations.

Key Dates

Recommendation

The establishment of an ATM offering provides Sky Quarry Inc. with financial flexibility, which is a positive for long-term stability. However, it also introduces potential dilution for existing shareholders. Without specific details on the intended use of proceeds or a significant change in the Company's operational outlook, this financing mechanism alone does not warrant a strong 'buy' or 'sell' recommendation. Investors should 'hold' and monitor the Company's actual utilization of the ATM, the prices at which shares are sold, and the impact on the balance sheet and future growth initiatives.

Keywords

At-The-Market Offering, ATM, Equity Offering, Capital Raise, Common Stock, Dilution, SEC Filing, Form 8-K, Cantor Fitzgerald, SKYQ, Shelf Registration