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- Covenant Violation (new) — Debtholders agreed to waive defaults or events of default existing under the Debentures as of March 31, 2026.
Reborn Coffee enters forbearance after debt default, faces $1.95M in near-term payments
Filed April 6, 2026 · Period ending March 31, 2026 · ~1 min read
Key Changes
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high
Company defaulted on convertible debt after failing to pay debtholders 30% of proceeds from prior $6.5M equity raise. Debtholders agreed to waive defaults through March 31, 2026 in exchange for immediate cash and warrants.
Item 1.01 verify on EDGAR → -
high
Must pay $1.06M by April 6 and $400K by April 20, then $500K monthly starting May until debt is paid or converted. These mandatory payments will significantly strain cash reserves.
Item 1.01 verify on EDGAR → -
medium
Issued warrants to purchase 250,000 shares at $2.00 per share to debtholders as additional forbearance consideration, representing potential dilution to existing shareholders.
Item 3.02 verify on EDGAR → -
low
Must file registration statement within five business days of 10-K filing to register shares underlying new and previously issued warrants to Arena Investors.
Item 1.01 verify on EDGAR →
Summary
Reborn Coffee disclosed it entered a forbearance agreement with Arena Investors after defaulting on convertible debt obligations. The default stemmed from the company's failure to timely pay debtholders 30% of proceeds from a $6.5 million equity financing completed in October 2025. After Arena Investors demanded payment in February 2026, negotiations over timing caused delays that triggered default provisions.
Under the forbearance terms, the company must make $1.95 million in payments by April 20, 2026, followed by $500,000 monthly payments starting in May until the debt is fully repaid or converted. The company also issued warrants for 250,000 shares at $2.00 per share as additional consideration. These aggressive payment terms will severely test the company's liquidity and ability to fund operations.
Retail investors should closely monitor whether Reborn Coffee makes the April 6 and April 20 payments on schedule. Missing these deadlines would likely trigger acceleration of the full debt balance and potential enforcement actions by Arena Investors, putting the company's financial viability at immediate risk.
Section-by-Section Diff
Event · Item 1.01 — Entry into a Material Definitive Agreement
Company entered forbearance agreement with debtholders after delayed payment, requiring $1.95M in near-term cash payments and warrant issuance.
Added in current filing · verify on EDGAR →
On March 31, 2026, the Company and the Arena Investors entered into a Forbearance Agreement (the “Forbearance Agreement”) whereby the Arena Investors would waive and forbear from any exercise of their rights and remedies under the Securities Purchase Agreement, the Debentures and applicable law in connection with the Specified Delay and waive any defaults or events of default which may exist and may be ongoing under the Debentures as of March 31, 2026.
The Company entered into a forbearance agreement after failing to timely pay debtholders 30% of proceeds from a prior equity financing. The Arena Investors agreed to waive defaults and not exercise remedies in exchange for specific payment terms and additional warrants. This indicates the Company was in default under its convertible debt agreements.
Added in current filing · verify on EDGAR →
the Company agreed to: (i) make payment of $1,059,522 in cash to the Arena Investors on or before April 6, 2026; (ii) make payment of $400,000 in cash to the Arena Investors on or before April 20, 2026; (iii) make payment of $500,000 in cash to the Arena Investors on the sixth day of each month, beginning in May 2026, until the Debentures have been fully paid off or converted
As part of the forbearance agreement, the Company must make immediate cash payments totaling $1,459,522 by April 20, 2026, followed by monthly $500,000 payments starting in May 2026. These mandatory payments will significantly impact the Company's cash position and liquidity.
Event · Item 3.02 — Unregistered Sales of Equity Securities
Reborn Coffee issued unregistered Forbearance Warrants to accredited investors under Securities Act exemptions.
Added in current filing · verify on EDGAR →
The Company has issued the Forbearance Warrants, and will issue the shares underlying the Forbearance Warrants, pursuant to the exemption from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), available under Section 4(a) (2) and/or Rule 506(b) of Regulation D promulgated thereunder.
Reborn Coffee issued warrants called Forbearance Warrants to certain investors without registering them with the SEC, using private placement exemptions. The warrants allow holders to purchase company shares in the future. The term 'forbearance' typically indicates these warrants were issued in connection with debt restructuring or lender concessions.
Added in current filing · verify on EDGAR →
The Arena Investors are each an “accredited investor” as such term is defined in Regulation D promulgated under the Securities Act.
The warrants were issued to Arena Investors, who qualify as accredited investors under SEC rules. This means they are sophisticated investors meeting certain wealth or income thresholds, which allows the company to issue securities without full SEC registration.
Event · Item 9.01 — Financial Statements and Exhibits
Reborn Coffee entered a Forbearance Agreement with Arena Investors on March 31, 2026, suggesting potential debt or covenant issues.
Added in current filing · verify on EDGAR →
Forbearance Agreement by and among Reborn Coffee, Inc. and the Arena Investors dated March 31, 2026
The company entered into a Forbearance Agreement with Arena Investors on March 31, 2026. A forbearance agreement typically means a lender is temporarily refraining from exercising rights due to a default or covenant breach, suggesting the company may be experiencing financial stress or compliance issues with its debt obligations. The specific terms are not disclosed in this 8-K filing.
Added in current filing · verify on EDGAR →
Form of Forbearance Warrant
The company issued warrants in connection with the Forbearance Agreement. Forbearance warrants are typically granted to lenders as consideration for agreeing to forbear from exercising default remedies, representing additional dilution to existing shareholders in exchange for temporary relief from debt obligations.
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Figures/quotes linked to EDGAR · Narrative written by AI · Jun 3, 2026 · How we verify