EX-99.7 8 vivakorinc_ex99-7.htm EXHIBIT 99.7

 

Exhibit 99.7

 

VIVAKOR, INC., ENDEAVOR CRUDE, LLC, MERIDIAN LEASING EQUIPMENT, LLC,

EQUIPMENT TRANSPORT, LLC AND SILVER FUELS PROCESSING, LLC

Unaudited Pro Forma Consolidated Balance Sheets

December 31, 2023

 

    Vivakor, Inc.*     Endeavor
Entities**		     Silver Fuels
Processing, LLC		     Adjustments     Consolidated  
ASSETS                                        
Current assets:                                        
Cash and cash equivalents   $ 744,307     $ 1,164,555     $ 5,990     $ -     $ 1,914,852  
Cash and cash equivalents, restricted     -       1,262,525       -       -       1,262,525  
Accounts receivable     2,458,730       11,786,096       33,287       (204,329 )(f)     14,073,784  
Accounts receivable-related party     174,083       139,134       30,750       -       343,967  
Prepaid expenses     74,876       546,655       63,309       -       684,840  
Marketable securities     495,826       -       -       -       495,826  
Inventories     44,632       46,784       -       -       91,416  
Other assets     1,118,188       2,953,305       -       -       4,071,493  
Total current assets     5,110,642       17,899,054       133,336       (204,329 )     22,938,703  
                                         
Other investments     4,000       -       -       -       4,000  
Other assets     -       871,655       2,992       -       874,647  
Notes receivable     213,168       -       -       -       213,168  
Property and equipment, net     24,299,317       65,895,192       1,157,113       -       91,351,622  
Right of use assets-operating leases     1,534,870       5,657,160       -       -       7,192,030  
License agreements, net     1,651,324       -       -       -       1,651,324  
Intellectual property, net     23,437,654       -       -       11,552,563 (c)(d)     34,990,217  
Goodwill     14,984,768       -       -       22,327,689 (b)      37,312,457  
Total assets   $ 71,235,743     $ 90,323,061     $ 1,293,441     $ 33,675,923     $ 196,528,168  
                                         
LIABILITIES AND STOCKHOLDERS’ EQUITY                                        
Current liabilities:                                        
Accounts payable and accrued expenses   $ 16,578,642     $ 5,987,368     $ 297,128     $ (22,922 )(f)   $ 22,840,216  
Accounts payable and accrued expenses-related parties     1,933,817       447,638       28,679       -       2,410,134  
Accrued compensation     1,968,063       699,224       -       -       2,667,287  
Operating lease liabilities, current     435,906       2,486,740       -       -       2,922,646  
Finance lease liabilities, current     963,900       6,200,710       -       -       7,164,610  
Line of credit     -       5,575,005               -       5,575,005  
Loans and notes payable, current     2,477,970       17,241,350       -       -       19,719,320  
Loans and notes payable, current-related parties     15,626,168       1,182,193       -       -       16,808,361  
Total current liabilities     39,984,466       39,820,228       325,807       (22,922 )     80,107,579  
                                         
Operating lease liabilities, long term     1,193,915       3,164,086       -       -       4,358,001  
Finance lease liabilities, long term     1,852,178       8,773,041       -       -       10,625,219  
Loans and notes payable, long term     856,034       11,922,733       -       -       12,778,767  
Loans and notes payable, long term-related parties     5,590,008       1,182,193       -       -       6,772,201  
Long-term debt (working interest royalty programs)     4,433,630       -       -       -       4,433,630  
Deferred tax liability     88,323       -       -       -       88,323  
Total liabilities     53,998,554       64,862,281       325,807       (22,922 )     119,163,720  
                                         
Stockholders’ equity:                                        
Preferred stock, $0.001 par value; 15,000,000 shares authorized, 54,955 outstanding     -       -       -       55 (a)      55  
Common stock, $0.001 par value; 200,000,000 and 41,666,667 shares authorized; 36,242,029 and 18,064,838 were issued and outstanding as December 31, 2023 and 2022, respectively     26,221       -       -       10,021 (a)(e)      36,242  
Additional paid-in capital     83,097,553       -       -       64,966,543 (a)(e)      148,064,096  
Treasury stock, at cost     (20,000 )     -       -       -       (20,000 )
Accumulated deficit     (65,908,406 )     25,460,780       967,634       (31,277,774 )(b)(d)(e)(f)     (70,757,766 )
Total Vivakor, Inc. stockholders’ equity     17,195,368       25,460,780       967,634       33,698,845       77,322,627  
Noncontrolling interest     41,821       -       -       -       41,821  
Total stockholders’ equity     17,237,189       25,460,780       967,634       33,698,845       77,364,448  
Total liabilities and stockholders’ equity   $ 71,235,743     $ 90,323,061     $ 1,293,441     $ 33,675,923     $ 196,528,168  

 

 

Notes

* Includes Vivakor, Inc. and all of its active wholly and majority-owned subsidiaries and any consolidated variable interest entities as reported in its Form 10-K for the year ended December 31, 2023.
** Includes Endeavor Crude, LLC, Meridian Equipment Leasing, LLC, and active subsidiaries Equipment Transport, LLC and CPE Gathering Midcon, LLC.
   
(a) To record the aggregate acquisition consideration, which is currently estimated to be approximately $61.6 million (subject to a full valuation report under our purchase price allocation to be completed by the Company by September 30, 2025) and is payable in shares of the Company’s common and preferred stock currently anticipated to consist of 6,724,219 shares of the Company's common stock and 54,955 shares of the Company’s Series A Preferred Stock.
(b) To eliminate the capital structures of the acquired companies, and to record goodwill, and adjustments to the net assets with goodwill and such adjustments having been valued as of the actual date of close (October 1, 2024) with any variance due to the pro forma period of reporting being attributed to goodwill.
(c) To allocate an estimated 20% of goodwill to intangible assets subject to a full valuation report to be completed by the Company by September 30, 2025.
(d) To record amortization expense assuming a remaining useful life of 10 years on the intangible assets acquired if the acquisition had occurred on January 1, 2023. The life of the intangibles is an estimate subject to a full valuation report that will be completed by the Company by September 30, 2025.
(e) To record the estimated dividends payable related to the cumulative 6% preferred stock to be issued as consideration if the acquisition had occurred on January 1, 2023.
(f) To eliminate intercompany transactions between the acquired entities and Vivakor, Inc.*

 

 

 

 

VIVAKOR, INC., ENDEAVOR CRUDE, LLC, MERIDIAN LEASING EQUIPMENT, LLC,

EQUIPMENT TRANSPORT, LLC AND SILVER FUELS PROCESSING, LLC

Unaudited Pro Forma Consolidated Statement of Operations

For the Year Ended December 31, 2023

 

    Vivakor, Inc.*     Endeavor
Entities**		     Silver Fuels
Processing, LLC		     Adjustments     Consolidated  
Revenues                                        
Product revenue - third parties   $ 46,252,141     $ -     $ -     $ -     $ 46,252,141  
Product revenue - related party     13,069,611       -       -       -       13,069,611  
Services revenue - third parties     -       52,243,703       -       (658,182 )(c)     51,585,521  
Services revenue - related party     -       265,486       630,000       -       895,486  
Total revenues     59,321,752       52,509,189       630,000       (658,182 )     111,802,759  
Cost of revenues     54,300,788       22,953,043       128,766       -       77,382,597  
Gross profit     5,020,964       29,556,146       501,234       (658,182 )     34,420,161  
Operating expenses:                                        
Sales and marketing     3,070       -       -       -       3,070  
General and administrative     7,416,810       16,910,628       265,264       (658,182 )(c)     23,934,519  
Bad debt expense     -       39,197       -       -       39,197  
Amortization and depreciation     3,932,744       7,820,817       252,147       1,370,651 (b)     13,376,359  
Total operating expenses     11,352,624       24,770,642       517,411       712,469       37,353,146  
Income (loss) from operations     (6,331,660 )     4,785,504       (16,177 )     (1,370,651 )     (2,932,984 )
Other income (expense):                                        
Unrealized loss on marketable securities     (1,156,928 )     -       -       -       (1,156,928 )
Loss on disposition of asset     -       (48,630 )     -       -       (48,630 )
Gain on deconsolidation of variable interest entity     438,099       -       -       -       438,099  
Gain on oil commodity hedging transactions     -       686,096       -       -       686,096  
Interest income     14,953       70,696       -       -       85,649  
Interest expense     (966,137 )     (2,338,911 )     -       -       (3,305,048 )
Interest expense-related parties     (3,058,940 )     -       -       -       (3,058,940 )
Other income     318,041       416,920       160,432       -       895,393  
Total other income (expense)     (4,410,912 )     (1,213,829 )     160,432       -       (5,464,309 )
Income (loss) before provision for income taxes     (10,742,572 )     3,571,675       144,255       (1,370,651 )     (8,397,293 )
Provision for income taxes     (92,703 )     -       -       -       (92,703 )
Consolidated net income (loss)     (10,835,275 )     3,571,675       144,255       (1,370,651 )     (8,489,996 )
Less: Net loss attributable to noncontrolling interests     (96,650 )     -       -       -       (96,650 )
Net income (loss) attributable to Vivakor, Inc.   $ (10,738,625 )   $ 3,571,675     $ 144,255     $ (1,370,651 )   $ (8,393,346 )
                                         
Basic and diluted net loss per share   $ (0.56 )                           $ (0.32 )
                                         
Basic weighted average common shares outstanding     19,261,143                       10,021,521 (a)     26,583,845  

 

 

Notes

* Includes Vivakor, Inc. and all of its active wholly and majority-owned subsidiaries and any consolidated variable interest entities as reported in its Form 10-K for the year ended December 31, 2023.
** Includes Endeavor Crude, LLC, Meridian Equipment Leasing, LLC, and active subsidiaries Equipment Transport, LLC and CPE Gathering Midcon, LLC.

 

(a) Reflects the issuance of 6,724,219 Vivakor, Inc. common shares at acquisition (as calculated on actual close date of October 1, 2024) and 3,297,302 common shares related to the 6% preferred stock dividend-PIK as if the acquisition had occurred on January 1, 2023.
(b) To record amortization of intangible expense of $1,370,651 upon close of the acquisition as if the acquisition had occurred on January 1, 2023.
(c) To eliminate intercompany transactions between Vivakor, Inc. and the acquired entities.

 

2

 

 

VIVAKOR, INC., ENDEAVOR CRUDE, LLC, MERIDIAN LEASING EQUIPMENT, LLC,

EQUIPMENT TRANSPORT, LLC AND SILVER FUELS PROCESSING, LLC

Unaudited Pro Forma Consolidated Balance Sheets June 30, 2024

 

    Vivakor, Inc.*     Endeavor
Entities**		     Silver Fuels
Processing, LLC		     Adjustments     Consolidated  
ASSETS                              
Current assets:                                        
Cash and cash equivalents   $ 94,970     $ 1,122,432     $ 4,673     $ -     $ 1,222,075  
Cash and cash equivalents, restricted     -       2,630,164       -       -       2,630,164  
Accounts receivable     3,372,685       19,976,647       -       (686,334 )(f)      22,662,998  
Accounts receivable-related party     106,000       5,420,074       207,055       -       5,733,129  
Prepaid expenses     180,385       3,193,156       169,627       -       3,543,168  
Marketable securities     413,188       -       -       -       413,188  
Inventories     75,167       134,810       -       -       209,977  
Other assets     1,511,254       -       8,312       -       1,519,566  
Total current assets     5,753,649       32,477,283       389,667       (686,334 )     37,934,265  
                                         
Other investments     4,000       -       -       -       4,000  
Other assets     -       1,194,614       12,992       -       1,207,606  
Notes receivable     217,781       -       -       -       217,781  
Property and equipment, net     27,641,821       61,738,454       986,566       -       90,366,841  
Right of use assets-operating leases     1,353,507       4,424,081       -       -       5,777,588  
License agreements, net     1,590,910       -       -       -       1,590,910  
Intellectual property, net     22,133,251       1,476,652       -       10,622,549 (c)(d)      34,232,452  
Goodwill     14,984,768       -       -       32,078,902 (b)      47,063,670  
Total assets   $ 73,679,687     $ 101,311,084     $ 1,389,225     $ 42,015,117     $ 218,395,113  
                                         
LIABILITIES AND STOCKHOLDERS’ EQUITY                                        
Current liabilities:                                        
Accounts payable and accrued expenses   $ 18,307,013     $ 14,026,873     $ 1,093     $ (221,507 )(f)   $ 32,113,471  
Accounts payable and accrued expenses-related parties     3,242,052       2,285,588       -       -       5,527,640  
Accrued compensation     834,448       621,706       -       -       1,456,154  
Line of credit     -       13,409,798       -       -       13,409,798  
Operating lease liabilities, current     153,985       1,240,870       -       -       1,394,855  
Finance lease liabilities, current     481,950       3,195,725       -       -       3,677,675  
Loans and notes payable, current     3,960,231       19,812,798       -       -       23,773,029  
Loans and notes payable, current-related parties     16,740,820       3,569,988       318,468       -       20,629,276  
Total current liabilities     43,720,499       58,163,346       319,561       (221, 507 )     101,981,899  
                                         
Operating lease liabilities, long term     1,291,488       3,241,445       -       -       4,532,933  
Finance lease liabilities, long term     2,096,882       9,705,171       -       -       11,802,053  
Loans and notes payable, long term     879,645       12,978,246       -       -       13,857,891  
Loans and notes payable, long term-related parties     5,590,008       -       -       -       5,590,008  
Long-term debt (working interest royalty programs)     4,947,524       -       -       -       4,947,524  
Deferred tax liability     120,076       -       -       -       120,076  
Total liabilities     58,646,122       84,088,208       319,561       (221,507 )     142,832,384  
                                         
Stockholders’ equity:                                        
Preferred stock, $0.001 par value; 15,000,000 shares authorized, 54,955 outstanding     -       -       -       55 (a)     55  
Common stock, $0.001 par value; 200,000,000 shares authorized; 37,508,017 and 26,220,508 were issued and outstanding as of June 30, 2024 and December 31, 2023, respectively     29,136       -       -       8,373 (a)(e)      37,509  
Additional paid-in capital     86,134,795       -       -       63,319,540 (a)(e)      149,454,335  
Treasury stock, at cost     (20,000 )     -       -       -       (20,000 )
Accumulated deficit     (71,103,639 )     17,222,876       1,069,664       (21,091,344 )(b)(d)(e)(f)     (73,902,443 )
Total Vivakor, Inc. stockholders’ equity     15,040,292       17,222,876       1,069,664       42,236,625       75,569,457  
Noncontrolling interest     (6,727 )     -       -       -       (6,727 )
Total stockholders’ equity     15,033,565       17,222,876       1,069,664       42,236,625       75,562,730  
Total liabilities and stockholders’ equity   $ 73,679,687     $ 101,311,084     $ 1,389,225     $ 42,015,117     $ 218,395,113  

 

 

Notes

* Includes Vivakor, Inc. and all of its active wholly and majority-owned subsidiaries and any consolidated variable interest entities as reported in its Form 10-Q for the six months ended June 30, 2024.
**

Includes Endeavor Crude, LLC, Equipment Transport, LLC, and Meridian Equipment Leasing, LLC, and active subsidiary CPE Gathering Midcon, LLC.

 

(a) To record the aggregate acquisition consideration, which is currently estimated to be approximately $61.6 million (subject to a full valuation report under our purchase price allocation to be completed by the Company by September 30, 2025) and is payable in shares of the Company’s common and preferred stock currently anticipated to consist of  6,724,219 shares of the Company's common stock and 54,955 shares of the Company’s Series A Preferred Stock. 
(b) To eliminate the capital structures of the acquired companies, and to record goodwill, and adjustments to the net assets with goodwill and such adjustments having been valued as of the actual date of close (October 1, 2024) with any variance due to the pro forma period of reporting being attributed to goodwill.
(c) To allocate an estimated 20% of goodwill to intangible assets subject to a full valuation report to be completed by the Company by September 30, 2025.
(d) To record amortization expense assuming a remaining useful life of 9 years on the intangible assets acquired if the acquisition had occurred on January 1, 2024. The life of the intangibles is an estimate subject to a full valuation report that will be completed by the Company within by September 30, 2025.
(e) To record the estimated dividends payable related to the cumulative 6% preferred stock to be issued as consideration if the acquisition had occurred on January 1, 2024.
(f) To eliminate intercompany transactions between the acquired entities and Vivakor, Inc.*

 

3

 

 

VIVAKOR, INC., ENDEAVOR CRUDE, LLC, MERIDIAN LEASING EQUIPMENT, LLC,

EQUIPMENT TRANSPORT, LLC AND SILVER FUELS PROCESSING, LLC

Unaudited Pro Forma Consolidated Statement of Operations

For the Six Months Ended June 30, 2024

 

    Vivakor, Inc.*     Endeavor
Entities**		     Silver Fuels
Processing, LLC		     Adjustments     Consolidated  
Revenues                                        
Product revenue - third parties   $ 26,223,680     $ -     $ -     $ -     $ 26,223,680  
Product revenue - related party     5,978,833       -       -       -       5,978,833  
Services revenue - third parties     -       41,491,414       379,500       (444,560 )(c)      41,426,354  
Services revenue - related party     -       5,347,008       58,360       -       5,405,368  
Total revenues     32,202,513       46,838,422       437,860       (444,560 )     79,034,235  
Cost of revenues     30,023,562       10,196,478       67,387       -       40,287,427  
Gross profit     2,178,951       36,641,944       370,473       (444,560 )     38,746,808  
Operating expenses:                                        
Sales and marketing     11,668       -       -       -       11,668  
General and administrative     4,639,146       27,591,588       176,325       (444,560 )(c)      31,962,499  
Amortization and depreciation     1,997,473       7,890,989       164,118       685,326 (b)      10,737,906  
Total operating expenses     6,648,287       35,482,577       340,443       240,766       42,712,073  
Income (loss) from operations     (4,469,336 )     1,159,367       30,030       (685,326 )     (3,965,265 )
Other income (expense):                                     0  
Unrealized loss on marketable securities     (82,638 )     -       -       -       (82,638 )
Loss on disposition of asset     -       (18,630 )     -       -       (18,630 )
Gain deconsolidation of subsidiary     177,550       -       -       -       177,550  
Interest income     4,613       35,500       -       -       40,113  
Interest expense     (923,987 )     (3,825,511 )     -       -       (4,749,498 )
Other income     84,000       58,932       -       -       142,932  
Total other income (expense)     (740,462 )     (3,749,709 )     -       -       (4,490,171 )
Income (loss) before provision for income taxes     (5,209,798 )     (2,590,342 )     30,030       (685,326 )     (8,455,436 )
Provision for income taxes     (33,983 )     -       -       -       (33,983 )
Consolidated net income (loss)     (5,243,781 )     (2,590,342 )     30,030       (685,326 )     (8,489,419 )
Less: Net loss attributable to noncontrolling interests     (48,548 )     -       -       -       (48,548 )
Net income (loss) attributable to Vivakor, Inc.   $ (5,292,329 )   $ (2,590,342 )   $ 30,030     $ (685,326 )   $ (8,537,967 )
                                         
Basic and diluted net loss per share   $ (0.19 )                           $ (0.25 )
                                         
Basic weighted average common shares outstanding     27,189,918                       8,372,870 (a)      34,312,712  

 

 

Notes

 

* Includes Vivakor, Inc. and all of its active wholly and majority-owned subsidiaries and any consolidated variable interest entities as reported in its Form 10-Q for the six months ended June 30, 2024.
** Includes Endeavor Crude, LLC, Equipment Transport, LLC, and Meridian Equipment Leasing, LLC, and active subsidiary CPE Gathering Midcon, LLC.

 

(a) Reflects the issuance of 6,724,219 Vivakor, Inc. common shares at acquisition (as calculated on actual close date of October 1, 2024) and 1,648,651 common shares related to the 6% preferred stock dividend-PIK as if the acquisition had occurred on January 1, 2024.
(b) To record amortization of intangible expense of $685,326 upon close of the acquisition as if the acquisition had occurred on January 1, 2024.
(c) To eliminate intercompany transactions between Vivakor, Inc. and the acquired entities

 

4

 

 

VIVAKOR, INC., ENDEAVOR CRUDE, LLC, MERIDIAN LEASING EQUIPMENT, LLC,

EQUIPMENT TRANSPORT, LLC AND SILVER FUELS PROCESSING, LLC

Unaudited Pro Forma Consolidated Balance Sheets September 30, 2024

 

   Vivakor, Inc.*   Endeavor
Entities**		   Silver Fuels
Processing, LLC		   Adjustments    Consolidated 
ASSETS                          
Current assets:                          
Cash and cash equivalents  $687,172   $710,366   $1,699   $-    $1,399,237 
Cash and cash equivalents, restricted   -    3,258,649    -    -     3,258,649 
Accounts receivable   691,895    10,318,678    -    (607,957 )(f)   10,402,617 
Accounts receivable-related party   137,000    871,797    20,712    -     1,029,509 
Prepaid expenses   81,484    3,232,191    108,889    -     3,422,564 
Marketable securities   1,239,565    -    -    -     1,239,565 
Inventories   184,882    126,298    -    -     311,180 
Other assets   1,639,084    -    1,013    -     1,640,097 
Total current assets   4,661,082    18,517,979    132,313    (607,957 )   22,703,417 
                           
Other investments   4,000    -    -    -     4,000 
Other assets   -    1,149,824    12,992    -     1,162,816 
Notes receivable   220,088    -    -    -     220,088 
Property and equipment, net   28,348,642    58,813,934    902,680    -     88,065,256 
Right of use assets-operating leases   1,283,378    3,899,499    -    -     5,182,877 
License agreements, net   1,560,703    -    -    -     1,560,703 
Intellectual property, net   21,481,049    738,326    -    10,965,212 (c)(d)   33,184,587 
Goodwill   14,984,768    -    -    40,221,894 (b)   55,206,662 
Total assets  $72,543,710   $83,119,562   $1,047,985   $50,579,149    $207,290,406 
                           
LIABILITIES AND STOCKHOLDERS’ EQUITY                          
Current liabilities:                          
Accounts payable and accrued expenses  $19,635,178   $9,540,065   $36,009   $(225,548 )(f)  $28,985,703 
Accounts payable and accrued expenses-related parties   778,559    1,389,267    282,481    -     2,450,307 
Accrued compensation   1,046,481    682,877    -    -     1,729,358 
Operating lease liabilities, current   177,249    617,935    -    -     795,184 
Finance lease liabilities, current   717,828    1,693,233    -    -     2,411,061 
Loans and notes payable, current   3,236,529    22,131,967    -    -     25,368,496 
Loans and notes payable, current-related parties   21,538,331    2,690,208    -    -     24,228,539 
Line of credit   -    10,835,696    -    -     10,835,696 
Total current liabilities   47,130,154    49,581,248    318,490    (225,548 )    96,804,344 
                           
Operating lease liabilities, long term   1,199,082    3,281,564    -    -     4,480,646 
Finance lease liabilities, long term   1,734,193    10,121,022    -    -     11,855,215 
Loans and notes payable, long term   355,812    11,743,663    -    -     12,099,475 
Long-term debt (working interest royalty programs)   5,264,818    -    -    -     5,264,818 
Deferred tax liability   120,076    -    -    -     120,076 
Total liabilities   55,804,135    74,727,497    318,490    (225,548 )    130,624,574 
                           
Stockholders’ equity:                          
Preferred stock, $0.001 par value; 15,000,000 shares authorized, 54,955 outstanding   -    -    -    55 (a)   55 
Common stock, $0.001 par value; 200,000,000 shares authorized; 42,835,540 and 26,220,508 were issued and outstanding as of September 30, 2024 and December 31, 2023, respectively   33,638    -    -    9,197 (a)(e)    42,835 
Additional paid-in capital   89,576,500    -    -    64,143,041 (a)(e)    153,719,541 
Treasury stock, at cost   (20,000)   -    -    -     (20,000)
Accumulated deficit   (72,791,791)   8,392,065    729,495    (13,347,597 )(b)(d)(e)(f)    (77,017,828)
Total Vivakor, Inc. stockholders’ equity   16,798,347    8,392,065    729,495    50,804,697     76,724,604 
Noncontrolling interest   (58,772)   -    -    -     (58,772)
Total stockholders’ equity   16,739,575    8,392,065    729,495    50,804,697     76,665,832 
Total liabilities and stockholders’ equity  $72,543,710   $83,119,562   $1,047,985   $50,579,149    $207,290,406 

 

 
Notes
* Includes Vivakor, Inc. and all of its active wholly and majority-owned subsidiaries and any consolidated variable interest entities as reported in its Form 10-Q for the nine months ended September 30, 2024.
**

Includes Endeavor Crude, LLC, Equipment Transport, LLC, and Meridian Equipment Leasing, LLC, and active subsidiary CPE Gathering Midcon, LLC.

   
(a) To record the aggregate acquisition consideration, which is currently estimated to be approximately $61.6 million (subject to a full valuation report under our purchase price allocation to be completed by the Company by September 30, 2025) and is payable in shares of the Company’s common and preferred stock currently anticipated to consist of  6,724,219 shares of the Company's common stock and 54,955 shares of the Company’s Series A Preferred Stock. 
(b) To eliminate the capital structures of the acquired companies, and to record goodwill, and adjustments to the net assets with goodwill and such adjustments having been valued as of the actual date of close (October 1, 2024) with any variance due to the pro forma period of reporting being attributed to goodwill.
(c) To allocate an estimated 20% of goodwill to intangible assets subject to a full valuation report to be completed by the Company by September 30, 2025.
(d) To record amortization expense assuming a remaining useful life of 9 years on the intangible assets acquired if the acquisition had occurred on January 1, 2024. The life of the intangibles is an estimate subject to a full valuation report that will be completed by the Company by September 30, 2025.
(e) To record the estimated dividends payable related to the cumulative 6% preferred stock to be issued as consideration if the acquisition had occurred on January 1, 2024.
(f) To eliminate intercompany transactions between the acquired entities and Vivakor, Inc.*

 

5

 

 

VIVAKOR, INC., ENDEAVOR CRUDE, LLC, MERIDIAN LEASING EQUIPMENT, LLC,

EQUIPMENT TRANSPORT, LLC AND SILVER FUELS PROCESSING, LLC

Unaudited Pro Forma Consolidated Statement of Operations

For the Nine Months Ended September 30, 2024

 

    Vivakor, Inc.*     Endeavor
Entities**		     Silver Fuels
Processing, LLC		     Adjustments     Consolidated  
Revenues                                        
Product revenue - third parties   $ 30,999,451     $ -     $ -     $ -     $ 30,999,451  
Product revenue - related party     17,119,485       -       -       -       17,119,485  
Services revenue - third parties     -       68,568,366       569,250       (607,449 )(c)     68,530,167  
Services revenue - related party     -       2,107,086       81,884               2,188,970  
Total revenues     48,118,936       70,675,452       651,134       (607,449 )     118,838,073  
Cost of revenues     44,213,635       33,226,531       60,977       -       77,501,143  
Gross profit     3,905,301       37,448,921       590,157       (607,449 )     41,336,930  
Operating expenses:                                        
Sales and marketing     18,318       -       -       -       18,318  
General and administrative     7,252,540       23,714,693       221,795       (607,449 )(c)     30,581,579  
Amortization and depreciation     3,062,416       11,552,335       180,218       1,027,989 (b)     15,822,958  
Total operating expenses     10,333,274       35,267,028       402,013       420,539       46,422,854  
Income (loss) from operations     (6,427,973 )     2,181,893       188,144       (1,027,989 )     (5,085,925 )
Other income (expense):                                        
Unrealized gain on marketable securities     743,739       -       -       -       743,739  
Loss on disposition of asset     -       (18,630 )     -       -       (18,630 )
Gain deconsolidation of subsidiary     177,550       -       -       -       177,550  
Interest income     6,920       65,595       -       -       72,515  
Credit losses     -       (106,725 )     -       -       (106,725 )
Interest expense     (1,565,231 )     (6,727,054 )     -       -       (8,292,285 )
Interest expense-related parties     -       -       -       -       -  
Other income     115,000       59,351       33,750       -       208,101  
Total other income (expense)     (522,022 )     (6,727,463 )     33,750       -       (7,215,735 )
Income (loss) before provision for income taxes     (6,949,995 )     (4,545,570 )     221,894       (1,027,989 )     (12,301,660 )
Provision for income taxes     (33,983 )     -       -       -       (33,983 )
Consolidated net income (loss)     (6,983,978 )     (4,545,570 )     221,894       (1,027,989 )     (12,335,643 )
Less: Net loss attributable to noncontrolling interests     (100,593 )     -       -       -       (100,593 )
Net income (loss) attributable to Vivakor, Inc.   $ (6,883,385 )   $ (4,545,570 )   $ 221,894     $ (1,027,989 )   $ (12,235,050 )
                                         
Basic and diluted net loss per share   $ (0.24 )                           $ (0.34 )
                                         
Basic weighted average common shares outstanding     28,282,472                       9,197,195 (a)     35,844,608  

 

 

Notes

* Includes Vivakor, Inc. and all of its active wholly and majority-owned subsidiaries and any consolidated variable interest entities as reported in its Form 10-Q for the nine months ended September 30, 2024.
** Includes Endeavor Crude, LLC, Equipment Transport, LLC, and Meridian Equipment Leasing, LLC, and active subsidiary CPE Gathering Midcon, LLC.

 

(a) Reflects the issuance of 6,724,219 Vivakor, Inc. common shares at acquisition (as calculated on actual close date of October 1, 2024) and 2,472,976 common shares related to the 6% preferred stock dividend-PIK as if the acquisition had occurred on January 1, 2024.
(b) To record amortization of intangible expense of $770,991 upon close of the acquisition as if the acquisition had occurred on January 1, 2024.
(c) To eliminate intercompany transactions between Vivakor, Inc. and the acquired entities

 

6