8-K: Vivakor Secures Interim Debt Forbearance Amid Defaults

Vivakor, Inc. has entered into an interim forbearance agreement with Cedarview to temporarily avoid default on its secured promissory note, while also disclosing significant equity conversions.

Summary

• Vivakor entered an Interim Forbearance Agreement with Cedarview on December 31, 2025, due to existing defaults on its secured promissory note.
• Cedarview agreed to forbear its rights and not call the Company in default under the Note through January 23, 2026.
• This forbearance is contingent on Vivakor entering a long-term forbearance agreement by January 23, 2026.
• The proposed long-term agreement would extend the note's maturity to January 31, 2027, establish a payment plan, and include a Confession of Judgment for all amounts due (including default interest) plus $200,000 in collection expenses.
• The balance of the Defaulted Note Amount is stated to be $3,955,578.38 as of January 23, 2026.
• Separately, between December 31, 2025, and January 7, 2026, lenders converted $256,690 of convertible promissory notes into 37,886,206 shares of the company's common stock.

Sentiment

Score: 2

Explanation: The company is in default on a significant loan, requiring multiple forbearance agreements and agreeing to highly unfavorable terms like a Confession of Judgment and significant future equity/asset sale commitments. Substantial dilution has already occurred from convertible note conversions. While temporary relief is secured, the underlying financial distress is severe and ongoing.

Positives

• Secured an interim forbearance agreement, temporarily preventing Cedarview from exercising default rights until January 23, 2026.
• Potential for a long-term forbearance agreement to extend the loan maturity date to January 31, 2027, providing more time for repayment.

Negatives

• The company is currently in default on its secured promissory note with Cedarview.
• The interim forbearance is short-term, expiring on January 23, 2026, requiring a further agreement.
• The proposed long-term forbearance agreement will require a Confession of Judgment for all amounts due, including default interest, and $200,000 in collection expenses.
• Previous amendments to the loan terms required Vivakor to pay Cedarview 30% of net proceeds from future equity lines of credit and asset sales.
• Vivakor issued 300,000 shares of restricted common stock to Cedarview as part of prior loan amendments.
• Recent conversions of convertible notes resulted in the issuance of 37,886,206 shares of common stock, indicating significant dilution for existing shareholders.
• The Defaulted Note Amount is $3,955,578.38 as of January 23, 2026, reflecting the outstanding debt and accrued default interest.

Risks

• Failure to execute a long-term forbearance agreement by January 23, 2026, could lead Cedarview to exercise its full rights and remedies, including calling the Company in default.
• The Confession of Judgment clause in the proposed long-term agreement could expedite legal action against the company if future defaults occur, bypassing a trial.
• Significant dilution from the conversion of promissory notes and issuance of shares to Cedarview could negatively impact shareholder value.
• Ongoing financial distress and the company's inability to meet debt obligations on time pose a risk to its long-term viability.
• The requirement to pay 30% of future equity line drawdowns and asset sales to Cedarview could limit future capital and strategic flexibility for growth or other investments.

Future Outlook

Vivakor aims to finalize a long-term forbearance agreement with Cedarview by January 23, 2026, which would extend the maturity date of its secured promissory note to January 31, 2027, and establish a new payment plan. The company also continues to manage its convertible debt obligations, with recent conversions resulting in significant equity issuance.

Management Comments

• Management confirmed the payment of $589,890.37 on April 9, 2025, and the issuance of 300,000 restricted common shares to Cedarview on April 11, 2025, as per the Side Letter agreement.
• The company committed to filing a Current Report on Form 8-K by January 7, 2026, to disclose the material terms of the interim forbearance agreement.

Industry Context

The company's ongoing debt restructuring and reliance on forbearance agreements suggest significant financial challenges, which is not uncommon for smaller companies in capital-intensive sectors, especially when facing operational hurdles or market downturns. The issuance of substantial equity to satisfy debt obligations and convertible note conversions indicates a strategy to manage liquidity and avoid bankruptcy, albeit at the cost of significant shareholder dilution. This approach is often seen in companies struggling to access traditional debt markets or facing high interest rates.

Comparison to Industry Standards

• The reliance on multiple forbearance agreements and the agreement to a Confession of Judgment are indicators of severe financial distress, typically seen in companies nearing insolvency or undergoing significant restructuring, unlike financially stable industry peers who maintain regular debt servicing.
• The agreement to pay 30% of future equity line drawdowns and asset sales to a lender is an aggressive term, far exceeding typical covenants in standard corporate lending, and suggests a highly constrained financial position compared to companies with more flexible capital structures.
• The conversion of $256,690 in notes into 37,886,206 shares of common stock implies a very low conversion price, indicative of a distressed valuation and significant dilution for existing shareholders, which is a stark contrast to healthy companies that typically manage dilution more carefully.

Corporate Governance

Legal Proceedings

• The company will agree to a Confession of Judgment as part of the long-term forbearance agreement, which is a legal instrument that allows a creditor to obtain a judgment without a trial if the debtor defaults.

Stakeholder Impact

• Shareholders: Significant dilution from the issuance of 300,000 restricted common shares to Cedarview and 37,886,206 shares from convertible note conversions. Future equity raises will also be subject to a 30% payment to Cedarview, further impacting potential returns.
• Creditors (Cedarview): Secured temporary forbearance and is positioned to secure a long-term agreement with an extended maturity date, a payment plan, and a Confession of Judgment, enhancing their recovery prospects.
• Employees/Operations: The financial distress and debt obligations could impact operational stability, investment in growth, and employee morale, though not directly stated.

Next Steps

• Enter into a long-term forbearance agreement with Cedarview on or before January 23, 2026.
• Determine other terms of the extended maturity date with Cedarview on or before January 23, 2026.
• Adhere to the payment plan for the Note as agreed in the long-term forbearance agreement.
• Manage future equity lines of credit and asset sales, with 30% of net proceeds allocated to Cedarview.

Key Dates

Recommendation

The company is in severe financial distress, evidenced by multiple defaults, the need for forbearance agreements, and the agreement to a Confession of Judgment. The terms of the debt restructuring are highly unfavorable, including significant equity dilution (37,886,206 shares recently issued from conversions, plus 300,000 to Cedarview) and a commitment to allocate 30% of future capital raises and asset sales to debt repayment. This severely limits future growth potential and shareholder value. The ongoing financial instability and the high risk of further defaults, despite temporary relief, make the stock a strong sell.

Keywords

Vivakor, VIVK, SEC Filing, 8-K, Forbearance Agreement, Debt Default, Secured Promissory Note, Convertible Notes, Equity Dilution, Corporate Governance, Financial Distress, Cedarview, Loan Agreement, Confession of Judgment