UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended June 30, 2024

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Transition Period from _________ to _________

Commission file number: 000-41286

VIVAKOR, INC.

(Exact name of registrant as specified in its charter)

Nevada		26-2178141
(State or other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

5220 Spring Valley Road, Suite 500 Dallas, TX		75242
(Address of Principal Executive Offices)		(Zip Code)

(949) 281-2606

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading symbol(s)		Name of exchange on which registered
Common Stock, $0.001 par value		VIVK		The Nasdaq Stock Market LLC (Nasdaq Capital Market)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a small reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” a “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act: ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of August 12, 2024, there were 29,275,737 shares of the registrant’s common stock outstanding.

VIVAKOR, INC.

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2024

TABLE OF CONTENTS

		Page
PART I. FINANCIAL INFORMATION		1

ITEM 1.	Financial Statements	1

	Condensed Consolidated Balance Sheets as of June 30, 2024 (unaudited) and December 31, 2023	1

	Condensed Consolidated Statements of Operations for the Three and Six Months ended June 30, 2024 and 2023 (unaudited)	2

	Condensed Consolidated Statements of Changes in Stockholders’ Equity for the Three and Six Months ended June 30, 2024 and 2023 (unaudited)	3

	Condensed Consolidated Statements of Cash Flows for the Six Months ended June 30, 2024 and 2023 (unaudited)	4

	Notes to Condensed Consolidated Financial Statements (unaudited)	5

ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	18

ITEM 3.	Quantitative and Qualitative Disclosures about Market Risk	34

ITEM 4.	Controls and Procedures	34

PART II. OTHER INFORMATION		36

ITEM 1.	Legal Proceedings	36

ITEM 1A.	Risk Factors	36

ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	36

ITEM 3.	Defaults Upon Senior Securities	37

ITEM 4.	Mine Safety Disclosures	37

ITEM 5.	Other Information	37

ITEM 6.	Exhibits	40

SIGNATURES		42

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

VIVAKOR, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS


	June 30, 2024			December 31, 2023
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	94,970		$	744,307
Accounts receivable, net		3,372,685			2,458,730
Accounts receivable- related party		106,000			174,083
Prepaid expenses		180,385			74,876
Marketable securities		413,188			495,826
Inventories		75,167			44,632
Other assets		1,511,254			1,118,188
Total current assets		5,753,649			5,110,642

Other investments		4,000			4,000
Notes receivable		217,781			213,168
Property and equipment, net		27,641,821			24,299,317
Right of use assets- operating leases		1,353,507			1,534,870
License agreements, net		1,590,910			1,651,324
Intellectual property, net		22,133,251			23,437,654
Goodwill		14,984,768			14,984,768
Total assets	$	73,679,687		$	71,235,743

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued expenses	$	18,307,013		$	16,578,642
Accounts payable and accrued expenses- related parties		3,242,052			1,933,817
Accrued compensation		834,448			1,968,063
Operating lease liabilities, current		153,985			435,906
Finance lease liabilities, current		481,950			963,900
Loans and notes payable, current		3,960,231			2,477,970
Loans and notes payable, current- related parties		16,740,820			15,626,168
Total current liabilities		43,720,499			39,984,466

Operating lease liabilities, long term		1,291,488			1,193,915
Finance lease liabilities, long term		2,096,882			1,852,178
Loans and notes payable, long term		879,645			856,034
Loans and notes payable, long term- related parties		5,590,008			5,590,008
Long-term debt (working interest royalty programs)		4,947,524			4,433,630
Deferred tax liability		120,076			88,323
Total liabilities		58,646,122			53,998,554

Stockholders’ equity:
Preferred stock, $0.001 par value; 15,000,000 shares authorized, none outstanding
Common stock, $0.001 par value; 200,000,000 shares authorized; 29,135,547 and 26,220,508 were issued and outstanding as of June 30, 2024 and December 31, 2023, respectively		29,136			26,221
Additional paid-in capital		86,134,795			83,097,553
Treasury stock, at cost		(20,000	)		(20,000	)
Accumulated deficit		(71,103,639	)		(65,908,406	)
Total Vivakor, Inc. stockholders’ equity		15,040,292			17,195,368
Noncontrolling interest		(6,727	)		41,821
Total stockholders’ equity		15,033,565			17,237,189
Total liabilities and stockholders’ equity	$	73,679,687		$	71,235,743

See accompanying notes to consolidated financial statements

VIVAKOR, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2024			2023			2024			2023
Revenues
Product revenue - third parties	$	13,310,515		$	11,570,742		$	26,223,680		$	22,765,208
Product revenue - related party		2,870,607			2,019,896			5,978,833			6,370,302
Total revenues		16,181,122			13,590,638			32,202,513			29,135,510
Cost of revenues		15,070,308			12,375,874			30,023,562			26,407,588
Gross profit		1,110,814			1,214,764			2,178,951			2,727,922
Operating expenses:
Sales and marketing		628			628			11,668			1,217
General and administrative		2,974,180			1,384,203			4,639,146			3,237,124
Amortization and depreciation		988,420			667,867			1,997,473			1,452,387
Total operating expenses		3,963,228			2,052,698			6,648,287			4,690,728
Loss from operations		(2,852,414	)		(837,934	)		(4,469,336	)		(1,962,806	)
Other income (expense):
Unrealized gain (loss) on marketable securities		-			165,275			(82,638	)		(330,551	)
Gain deconsolidation of subsidiary		-			-			177,550			-
Interest income		2,306			-			4,613			-
Interest expense		(479,947	)		(459,079	)		(923,987	)		(910,373	)
Interest expense- related parties		-			(804,409	)		-			(1,558,784	)
Other income		30,000			14,116			84,000			24,116
Total other income (expense)		(447,641	)		(1,084,097	)		(740,462	)		(2,775,592	)
Loss before provision for income taxes		(3,300,055	)		(1,922,031	)		(5,209,798	)		(4,738,398	)
Provision for income taxes		(33,183	)		-			(33,983	)		(800	)
Consolidated net loss		(3,333,238	)		(1,922,031	)		(5,243,781	)		(4,739,198	)
Less: Net loss attributable to noncontrolling interests		(20,240	)		(77,358	)		(48,548	)		(359,933	)
Net loss attributable to Vivakor, Inc.	$	(3,312,998	)	$	(1,844,673	)	$	(5,195,233	)	$	(4,379,265	)

Basic and diluted net loss per share	$	(0.12	)	$	(0.10	)	$	(0.19	)	$	(0.24	)

Basic weighted average common shares outstanding		27,987,899			18,064,838			27,189,918			18,064,838

See accompanying notes to consolidated financial statements

VIVAKOR, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY


	Series A Preferred Stock				Common Stock				Additional Paid-in		Treasury			Accumulated			Non-controlling			Total Stockholders’
	Shares		Amount		Shares		Amount		Capital		Stock			Deficit			Interest			Equity
March 31, 2024 (unaudited)		-	$	-		26,520,508	$	26,521	$	83,710,538	$	(20,000	)	$	(67,790,641	)	$	13,513		$	15,939,931
Issuance of common stock for services		-		-		483,292		483		381,317		-			-			-			381,800
Issuance of common stock for a reduction of liabilities		-		-		100,000		100		93,890		-			-			-			93,990
Issuance of common stock on conversion of debt						903,095		903		1,047,590		-			-			-			1,048,493
Issuance of warrants for services		-		-		-		-		92,522		-			-			-			92,522
Stock based compensation		-		-		1,128,652		1,129		808,938		-			-			-			810,067
Net loss		-		-		-		-		-		-			(3,312,998	)		(20,240	)		(3,333,238	)
June 30, 2024 (unaudited)		-	$	-		29,135,547	$	29,136	$	86,134,795	$	(20,000	)	$	(71,103,639	)	$	(6,727	)	$	15,033,565

	Series A Preferred Stock				Common Stock				Additional Paid-in		Treasury			Accumulated			Non-controlling			Total Stockholders’
	Shares		Amount		Shares		Amount		Capital		Stock			Deficit			Interest			Equity
December 31, 2023		-	$	-		26,220,508	$	26,221	$	83,097,553	$	(20,000	)	$	(65,908,406	)	$	41,821		$	17,237,189
Issuance of common stock for services		-		-		483,292		483		381,317		-			-			-			381,800
Issuance of common stock for a reduction of liabilities		-		-		400,000		400		378,890		-			-			-			379,290
Issuance of common stock on conversion of debt						903,095		903		1,047,590		-			-			-			1,048,493
Issuance of warrants for services		-		-		-		-		92,522		-			-			-			92,522
Stock based compensation		-		-		1,128,652		1,129		1,136,923		-			-			-			1,138,052
Net loss		-		-		-		-		-		-			(5,195,233	)		(48,548	)		(5,243,781	)
June 30, 2024 (unaudited)		-	$	-		29,135,547	$	29,136	$	86,134,795	$	(20,000	)	$	(71,103,639	)	$	(6,727	)	$	15,033,565

	Series A Preferred Stock				Common Stock				Additional Paid-in		Treasury			Accumulated			Non-controlling			Total Stockholders’
	Shares		Amount		Shares		Amount		Capital		Stock			Deficit			Interest			Equity
March 31, 2023 (unaudited)		-	$	-		18,064,838	$	18,065	$	74,026,163	$	(20,000	)	$	(57,704,373	)	$	8,345,037		$	24,664,892
Distributions to noncontrolling interest		-		-		-		-		-		-			-			(317,234	)		(317,234	)
Issuance of noncontrolling interest for a reduction of debt		-		-		-		-		-		-			-

SEC Form 10-Q filed by Vivakor Inc.