Form 8-K/A - Current report: [Amend]

Share Name	Share Symbol	Market	Type
Vivakor Inc	NASDAQ:VIVK	NASDAQ	Common Stock

	Price Change	% Change	Share Price	Bid Price	Offer Price	High Price	Low Price	Open Price	Shares Traded	Last Trade
	0.00	0.00%	1.22	0.71	1.95				0	12:00:08

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K/A
(Amendment No. 1)

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 1, 2024

VIVAKOR, INC.

(Exact name of registrant as specified in its charter)

Nevada

001-41286

26-2178141

(State or other jurisdiction of

incorporation or organization)

(Commission

File Number)

(IRS Employer

Identification No.)

5220 Spring Valley Road, Suite 500

Dallas, TX 75254

(Address of principal executive offices)

(949) 281-2606

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock		VIVK		The Nasdaq Stock Market LLC (Nasdaq Capital Market)

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

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 13(a) of the Exchange Act. ☐

Explanatory Note

On October 7, 2024, Vivakor, Inc. (the “Company”), a Nevada corporation, filed a Current Report on Form 8-K (the “Initial Report”) to report that on October 1, 2024, the Company, Jorgan Development, LLC, a Louisiana limited liability company (“Jorgan”) and JBAH Holdings, LLC, a Texas limited liability company (“JBAH” and, together with Jorgan, the “Sellers”), as the equity holders of Endeavor Crude, LLC, a Texas limited liability company, Equipment Transport, LLC, a Pennsylvania limited liability company, Meridian Equipment Leasing, LLC, a Texas limited liability company, and Silver Fuels Processing, LLC, a Texas limited liability company (collectively, the “Endeavor Entities”) closed the transactions that were the subject of the previously-disclosed Membership Interest Purchase Agreement among them dated March 21, 2024, as amended (the “MIPA”).

This Current Report on Form 8-K/A (this “Amendment”) amends and supplements the Initial Report to provide financial statements of the Endeavor Entities, and the pro forma financial statements of the Company required by Item 9.01 of Form 8-K. No other modifications to the Initial Report are being made by this Amendment. This Amendment should be read in connection with the Initial Report, which provides a more complete description of the MIPA and transactions contemplated thereby. The financial statements of the Endeavor Entities are presented in two sets of financial statements for each period reported, with one set of financial statements being the combined financial statements of Endeavor Crude, LLC, which includes the combined financial results of Endeavor Crude, LLC, Equipment Transport, LLC and Meridian Equipment Leasing, LLC, and the second set of financial statements being the financial statements of Silver Fuels Processing, LLC.

Item 9.01.

Financial Statements and Exhibits.

(a)

Financial Statements of the Endeavor Entities

The audited combined financial statements of Endeavor Crude, LLC, Meridian Equipment Leasing, LLC, and Equipment Transport, LLC, and the audited financial statements of Silver Fuels Processing, LLC as of and for the years ended December 31, 2023 and 2022, together with the related notes to the financial statements, are included as Exhibits 99.1 and 99.2 to this Current Report.

The unaudited combined financial statements of Endeavor Crude, LLC, Meridian Equipment Leasing, LLC, and Equipment Transport, LLC and the unaudited financial statements of Silver Fuels Processing, LLC, for the six months ended June 30, 2024 and 2023, together with the related unaudited notes to the financial statements, are included as Exhibits 99.3 and 99.4 to this Current Report and are incorporated herein by reference.

The unaudited combined financial statements of Endeavor Crude, LLC, Meridian Equipment Leasing, LLC, and Equipment Transport, LLC, and the unaudited financial statements of Silver Fuels Processing, LLC, for the nine months ended September 30, 2024 and 2023, together with the related unaudited notes to the financial statements, are included as Exhibits 99.5 and 99.6 to this Current Report and are incorporated herein by reference.

(b)

Pro Forma Financial Information.

The unaudited pro forma consolidated financial statements of the Company for the six months ended June 30, 2024, the nine months ended September 30, 2024 and for the year ended December 31, 2023, are included as Exhibit 99.7 to this Current Report and are incorporated herein by reference.

The pro forma financial information included in this Amendment No.1 has been presented for informational purposes only and is not necessarily indicative of the consolidated financial position or results of operations that would have been realized had the acquisition occurred as of the dates indicated, nor is it meant to be indicative of any anticipated consolidated financial position or future results of operations that the Company will experience after the acquisition. The pro forma financial information is subject to a full valuation report to be completed by the Company by September 30, 2025according to ASC 805.

(d)

Exhibits

99.1		Audited Annual Combined Financial Statements of Endeavor Crude, LLC, Meridian Equipment Leasing, LLC, and Equipment Transport, LLC for the Years Ended December 31, 2023 and 2022
99.2		Audited Annual Financial Statements of Silver Fuels Processing LLC, for the Years Ended December 31, 2023 and 2022
99.3		Unaudited Combined Financial Statements of Endeavor Crude, LLC, Meridian Equipment Leasing, LLC, and Equipment Transport, LLC for the Six Months Ended June 30, 2024 and 2023
99.4		Unaudited Financial Statements of Silver Fuels Processing, LLC, for the Six Months Ended June 30, 2024 and 2023
99.5		Unaudited Combined Financial Statements of Endeavor Crude, LLC, Meridian Equipment Leasing, LLC, and Equipment Transport, LLC for the Nine Months Ended September 30, 2024 and 2023
99.6		Unaudited Financial Statements of Silver Fuels Processing, LLC, for the Nine Months Ended September 30, 2024 and 2023
99.7		Unaudited Pro Forma Consolidated Financial Information
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	VIVAKOR, INC.

Dated: December 13, 2024	By:	/s/ Tyler Nelson
		Name:	Tyler Nelson
		Title:	Chief Financial Officer

Exhibit 99.1

Endeavor Crude, LLC and Meridian

Equipment Leasing, LLC

Audited Combined Financial Statements

as of and for the year ended

December 31, 2023

Endeavor Crude, LLC and Meridian Equipment Leasing, LLC

Table of Contents

Independent Auditors’ Report		1-2

Combined Balance Sheet as of December 31, 2023		3

Combined Statement of Income for the year ended December 31, 2023		4

Combined Statement of Members’ Equity for the year ended December 31, 2023		5

Combined Statement of Cash Flows for the year ended December 31, 2023		6

Notes to the Combined Financial Statements		7-22

INDEPENDENT AUDITORS’ REPORT

Management

Endeavor Crude, LLC and Meridian Equipment Leasing, LLC

Dallas, Texas

Opinion

We have audited the accompanying combined financial statements of Endeavor Crude, LLC and Meridian Equipment Leasing, LLC, which comprise the balance sheet as of December 31, 2023 and the related combined statements of income, members’ equity, and statement of cash flows for the year then ended, and the related notes to the combined financial statements.

In our opinion, the combined financial statements referred to above present fairly, in all material respects, the financial position of Endeavor Crude, LLC and Meridian Equipment Leasing, LLC, as of December 31, 2023 and the results of its operations and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinion

We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Combined Financial Statements section of our report. We are required to be independent of Endeavor Crude, LLC and Meridian Equipment Leasing, LLC and to meet our other ethical responsibilities in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Responsibilities of Management for the Combined Financial Statements

Management is responsible for the preparation and fair presentation of the combined financial statements in accordance with accounting principles generally accepted in the United States of America and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the combined financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about Endeavor Crude, LLC and Meridian Equipment Leasing, LLC’s ability to continue as a going concern within one year after the date that the combined financial statements are available to be issued.

Auditors’ Responsibilities for the Audit of the Combined Financial Statements

Our objectives are to obtain reasonable assurance about whether the combined financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements, including omissions, are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the combined financial statements.

In performing an audit in accordance with generally accepted auditing standards, we:

●

Exercise professional judgment and maintain professional skepticism throughout the audit.

●

Identify and assess the risks of material misstatement of the combined financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the combined financial statements.

●

Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of Endeavor Crude, LLC and Meridian Equipment Leasing, LLC’s internal control. Accordingly, no such opinion is expressed.

●

Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the combined financial statements.

●

Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about Endeavor Crude, LLC and Meridian Equipment Leasing, LLC’s ability to continue as a going concern for a reasonable period of time

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit.

Shreveport, Louisiana

June 6, 2024

Endeavor Crude, LLC and Meridian Equipment Leasing, LLC

Combined Balance Sheet
as of December 31, 2023

Assets
Current assets
Cash			1,164,555
Restricted cash, Note 11			1,262,525
Trade accounts receivable, net of allowance for credit losses of $24,531 as of December 31, 2023, Note 2			11,925,230
Prepaid expenses			546,655
Inventory			46,784
Other current assets			2,953,305
Total current assets			17,899,054

Property and equipment, net, Note 4			65,895,192

Other assets
Right-of-use asset - operating, Note 9			5,657,160
Other assets			871,655
Total other assets, net			6,528,815

Total assets			90,323,061

Liabilities and members’ equity
Current liabilities
Trade payables			1,623,303
Accrued liabilities			5,510,927
Due to related-parties, Note 5			1,182,193
Line of credit, Note 11			5,575,005
Short-term notes payable, Note 13			2,397,623
Current portion of finance lease obligations, Note 8			6,200,710
Current portion of operating lease obligations, Note 9			2,486,740
Current portion of long-term debt, Note 7			14,843,727
Total current liabilities			39,820,228

Long-term liabilities
Finance lease obligations - less current portion, Note 8			8,773,041
Operating lease obligations - less current portion, Note 9			3,164,086
Long-term debt - less current portion, Note 7			13,104,926
Total long-term liabilities			25,042,053

Members’ equity			25,460,780

Total liabilities and members’ equity			90,323,061

See independent auditors’ report and accompanying notes to the combined financial statements.

Endeavor Crude, LLC and Meridian Equipment Leasing, LLC

Combined Statement of Income

for the year ended December 31, 2023

Sales	52,509,189

Operating expenses
Operating	7,500
Auto	2,825,237
Credit losses	39,197
Bank charges	567
Business licenses	884
Business taxes	220,033
Computer	384,305
Contract labor	89,941
Depreciation	6,989,967
Employee benefits	207,471
Insurance	229,714
Inspections	7,005
Licenses and permits	209,913
Meals	866
Miscellaneous	809,731
Office	7,353
Payroll taxes	256,653
Professional fess	383,987
Rent	354,237
Repairs and maintenance	1,274,726
Regulatory	29,511
Training	6,552
Travel	236,922
Utilities	291,769
Tools	1,432
Supplies	107,389
Employee	90,668
Lease	169,574
Amortization	830,850
Salaries and wages	31,595,576
Total operating expenses	47,659,530

Income from operations	4,849,659

Other income (expense)
Other income	1,103,016
Interest income	70,696
Gain on sale of assets	(48,630	)
Interest expense	(2,338,911	)
Legal settlement	(64,155	)
Total other expense	(1,277,984	)

Net income	3,571,675

See independent auditors’ report and accompanying notes to the combined financial statements.

Endeavor Crude, LLC and Meridian Equipment Leasing, LLC

Combined Statement of Members’ Equity

for the year ended December 31, 2023

	Accumulated Other Comprehensive Income			Members’ Equity			Total
Balance, December 31, 2022		28,884			30,990,723			31,019,607

Amounts reclassified from accumulated other comprehensive income		(28,884	)		28,884			0

Net income		0			3,571,675			3,571,675
Members’ contributions		0			4,901,138			4,901,138
Members’ distributions		0			(14,031,640	)		(14,031,640	)

Balance, December 31, 2023		0			25,460,780			25,460,780

See independent auditors’ report and accompanying notes to the combined financial statements.

Endeavor Crude, LLC and Meridian Equipment Leasing, LLC

Combined Statement of Cash Flows

for the year ended December 31, 2023

Cash flows from operating activities
Net income	3,571,675
Adjustments to reconcile net income to net cash used in operating activities:
Credit losses	39,197
Depreciation	6,989,967
Amortization of trucking contracts	830,850
Loss on disposal of assets	48,630
Amortization of debt issuance costs	77,346
(Increase) decrease in:
Trade accounts receivable	(11,715,257	)
Inventory	446,352
Prepaid expenses	(295,779	)
Other assets	(401,118	)
Increase (decrease) in:
Trade payables	(3,782,530	)
Accrued liabilities	3,913,346
Other liabilities	(137,500	)
Net cash used in operating activities	(414,821	)

Cash flows from investing activities
Purchases of property and equipment	(13,612,927	)
Proceeds from sale of assets	150,937
Net cash used in investing activities	(13,461,990	)

Cash flows from financing activities
Net borrowings on line of credit	3,579,946
Repayments of finance lease obligations	(2,959,635	)
Repayments on long-term debt	(2,406,890	)
Proceeds from issuance of long-term debt	14,478,240
Debt issuance costs incurred	(302,750	)
Members’ contributions	2,579,500
Members’ distributions	(1,980,414	)
Net cash provided by investing activities	12,987,997

Net change in cash and cash equivalents	(888,814	)

Beginning cash and cash equivalents	2,053,369

Ending cash and cash equivalents	1,164,555

Supplemental disclosure of cash flow information
Cash paid for interest	2,261,565

Supplementary non-cash investing and financing activities
Assignment of related-party receivables to parent through distributions	12,051,226
Assumption of related-party payables by parent through contributions	2,321,638
Obtaining right-of-use assets in exchange for finance lease obligations	10,160,304

See independent auditors’ report and accompanying notes to the combined financial statements.

Endeavor Crude, LLC and Meridian Equipment Leasing, LLC

Notes to the Combined Financial Statements

(1)

Nature of Business

Endeavor Crude, LLC (“Endeavor”) and Meridian Equipment Leasing, LLC (“Meridian”) (collectively, the “Company” or “Companies”) are privately held Texas limited liability companies. CPE Gathering Midcon, LLC (“CP”), a wholly-owned subsidiary of Meridian, is a privately held Delaware limited liability company and Equipment Transport, LLC (“ET”), a wholly-owned subsidiary of Meridian, is a privately held Pennsylvania limited liability company. The Company is primarily engaged in the business of crude oil transportation.

Endeavor was formed in February 2019 and began operations in April 2019. Meridian was formed in April 2019 and began operations in May 2019 through the acquisition of real estate and trucking assets. Endeavor’s primary activity of generating revenue is the transportation of crude oil through its operation of a fleet of trucks and tank trailers primarily servicing Texas and New Mexico. Meridian is the owner of this fleet of trucks and tank trailers. Meridian’s primary activity of generating revenue is the leasing of these trucks and tank trailers to Endeavor.

In December 2022, Meridian acquired 100% of the membership interests in CP through a business acquisition. CP owns and operates several transfer stations and pipelines used in the processing and transportation of crude oil and gas.

In December 2023, Meridian acquired 100% of the membership interests in ET through a business acquisition. ET owns and operates a fleet of trucks and tank trailers used in the transportation of crude oil and gas. See Note 10.

(2)

Summary of Significant Accounting Policies

Basis of accounting – The combined financial statements of the Company have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.

Principles of consolidation/combination – These financial statements have been combined as the Companies are under common ownership and management. Meridian’s wholly owned subsidiaries have been consolidated into Meridian’s financial statements before combination. All intercompany transactions and balances have been eliminated during consolidation and combination.

Basis of presentation and use of estimates – The preparation of combined financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

See independent auditors’ report.

Endeavor Crude, LLC and Meridian Equipment Leasing, LLC

Notes to the Combined Financial Statements

(2)

Summary of Significant Accounting Policies (continued)

Cash and cash equivalents – Cash and cash equivalents include all cash on hand and cash on deposit with maturities of less than three months.

Trade accounts receivable and allowance for credit losses – The Company’s trade accounts receivable are primarily derived from trucking transportation customers. At each balance sheet date, the Company recognizes an expected allowance for credit losses. In addition, also at each reporting date, this estimate is updated to reflect any changes in credit risk since the receivable was initially recorded. This estimate is calculated on a pooled basis where similar risk characteristics exist.

The allowance estimate is derived from a review of the Company’s historical losses based on the aging of receivables. This estimate is adjusted for management’s assessment of current conditions, reasonable and supportable forecasts regarding future events, and any other factors deemed relevant by the Company. The Company believes historical loss information is a reasonable starting point in which to calculate the expected allowance for credit losses as the Company’s portfolio segment, trucking transportation customers, has remained constant since the Company’s inception. The allowance for credit losses for trade accounts receivable was $24,531 as of December 31, 2023.

Property and equipment – Property and equipment are carried at cost, less accumulated depreciation. Depreciation of property and equipment is provided using the straight-line method over the estimated useful lives of the assets. Estimated useful lives of property and equipment are 3-7 years.

Routine maintenance and repairs are charged to operating expense, while costs of improvements and replacements are capitalized. When an asset is retired or sold, its cost and related accumulated depreciation are removed from the accounts, and the difference between the net book value of the asset and proceeds from disposition is recognized as a gain or loss in the combined statement of operations.

Other intangible assets – Other intangible assets consist of an acquired trucking contract that has been assigned a useful life of 5 years and is being amortized on a straight-line basis.

Total amortization expense relating to the trucking contract was $830,850 for the year ended December 31, 2023.

See independent auditors’ report.

Endeavor Crude, LLC and Meridian Equipment Leasing, LLC

Notes to the Combined Financial Statements

(2)

Summary of Significant Accounting Policies (continued)

Fair Value Measurements – The Company follows Accounting Standards Codification (“ASC”) 820, “Fair Value Measurements and Disclosures” (“ASC 820”), for assets and liabilities measured at fair value on a recurring basis. ASC 820 establishes a common definition for fair value to be applied to existing generally accepted accounting principles that requires the use of fair value measurements, establishes a framework for measuring fair value, and expands disclosure about such fair value measurements.

The framework for measuring fair value provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1) and the lowest priority to unobservable inputs (level 3). The three levels of the fair value hierarchy under ASC 820 are described as follows:

Level 1 – Observable inputs, such as quoted prices in active markets for identical assets or liabilities.

Level 2 – Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

Impairment of long-lived assets – The Company regularly assesses all of its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Management reviews all material assets annually for possible impairment. If such assets are considered to be impaired, the impairment recognized is measured as the amount by which the carrying amount of the assets exceeds the estimated fair value of the assets. No impairment was considered necessary during the year ended December 31, 2023.

Interest rate used for operating leases – Under the provisions of FASB ASC 842-10-65-1, the Company has elected to use the risk-free discount rate of a U.S. government bond with a period comparable with that of the lease term for all operating leases placed on the combined balance sheet.

See independent auditors’ report.

Endeavor Crude, LLC and Meridian Equipment Leasing, LLC

Notes to the Combined Financial Statements

(2)

Summary of Significant Accounting Policies (continued)

Revenue recognition – Substantially all revenue the Company earns is related to trucking fees charged to customers for gathering and transporting crude oil and gas products.

Management has identified that a legally enforceable contract with its customers is executed by both parties at the point of pickup at the customer’s location. Although the Company may have master agreements with its customers, these master agreements only establish general terms and there is no financial obligation to the customer until the load is accepted and the Company takes possession of the load.

The Company’s only performance obligation is transportation services, which is completed at the point in time in which the Company delivers the load to the customer’s designated delivery point, effectively transferring control of the load to the customer. At such time, the Company recognizes the related transportation revenue. There is no significant financing component in transaction price, as the Company’s customers generally pay within the contractual payment terms of 30 to 60 days.

Debt issuance costs – Debt issuance costs represent costs incurred in relation to the Main Street Loan Credit Facility (see Note 7). Such costs have been deferred and are being amortized on a straight-line basis over the five-year term of the related loan. Long-term debt, net of current portion is recorded on the accompanying combined balance sheet net of unamortized debt issuance costs. A total of $52,415 has been amortized to interest expense during the year ended December 31, 2023.

Income taxes – The Companies are limited liability companies that are taxed as partnerships for federal and state income tax purposes. As such, the Companies do not pay income taxes, as any income or loss and credits are included in the tax returns of the individual member. Accordingly, no provision has been made for income taxes in the combined financial statements.

Under the provisions of FASB ASC 740-10, the Company records a liability for uncertain tax positions when probable that a loss has been incurred and the amount can be reasonably estimated. The Company continually evaluates expiring statutes of limitations, audits, proposed settlements, changes in tax law and new authoritative rulings.

Subsequent events – Management has evaluated subsequent events through June 6, 2024 the date these financial statements were available to be issued. There were no material subsequent events that required recognition or disclosure in these financial statements. See note 15.

See independent auditors’ report.

Endeavor Crude, LLC and Meridian Equipment Leasing, LLC

Notes to the Combined Financial Statements

(3)

Major Customers and Concentration of Credit Risk

Endeavor had certain customers whose revenue individually represented 10% or more of the Company’s total revenue, or whose accounts receivable balances individually represented 10% or more of the Company’s total accounts receivable, as follows:

The Company had one (1) major customer that accounted for approximately 30% of revenue for the year ended December 31, 2023 and 34% of the balance of accounts receivable as of December 31, 2023.

The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits. Accounts are guaranteed by the Federal Deposit Insurance Corporation (“FDIC”) up to certain limits. The Company has not experienced any losses in such accounts.

(4)

Property and Equipment

The Company’s balance of property and equipment at year end is comprised of the following:

Land	2,848,857
Buildings and Improvements	1,700,201
Trucks and trailers	30,603,602
Right-of-use asset - finance leases	14,718,960
Pipeline and tanks	41,107,022
Sub-total	90,978,642
Less: accumulated depreciation	(25,083,450	)
Property and equipment, net	65,895,192

Depreciation expense related to property and equipment was $6,989,967 for the year ended December 31, 2023

(5)

Related-Party Transactions

During the year ended December 31, 2023, the Company received an operating loan from Waskom Enterprises, LLC, a related party controlled by James H. Ballengee (“Ballengee”), the manager of Jorgan Development, LLC, the majority owner of the Company. The loan is short term in nature with no stated repayment terms. As of December 31, 2023, the Company owed a total of $1,182,193 to Waskom Enterprises, LLC.

See independent auditors’ report.

Endeavor Crude, LLC and Meridian Equipment Leasing, LLC

Notes to the Combined Financial Statements

(5)

Related-Party Transactions (continued)

On January 1, 2023, Endeavor entered into a take or pay agreement with White Claw Crude, LLC (“WCC”), a related party controlled by Ballengee, in which the Company is to provide hauling services to WCC for their crude oil and gas products. The agreement states that if WCC does not haul 100,000 barrels per day during the period January 1, 2023 through December 31, 2033, the minimum volume commitment (“MVC”), then WCC must pay the Company a deficiency fee equal to the shortage amount, in barrels, multiplied by 25% of the average rate of all hauls for the related calendar year. During the year ended December 31, 2023, the Company earned $8,997,073 in deficiency fees, which are included in sales in the accompanying combined statement of income.

(6)

Note Payable – PPP Loan

On March 11, 2020, the World Health Organization pronounced the coronavirus (COVID-19) outbreak a pandemic. Citizens and the economies of the United States and other countries have been significantly impacted by the pandemic. In response to the COVID-19 outbreak in 2020, the U.S. Federal Government enacted the Coronavirus Aid, Relief, and Economic Security Act that, among other economic stimulus measures, established the Paycheck Protection Program (PPP) to provide small business loans. In April 2020, the Company obtained its first PPP loan in the amount of $2,145,300. The note matures in April 2025 and bears interest at a fixed annual rate of 1% with the first six months of interest deferred. During the period ending December 31, 2021, the Company received a second PPP loan in the amount of $2,000,000 and received forgiveness of $1,000,735 for the first loan. The second note matures in February of 2026 and bears interest at a fixed annual rate of 1%. The Company believes that all PPP proceeds have been used on qualifying expenses and expects to be forgiven for the remaining portion of the first loan, as well as the full amount of the second loan.

See independent auditors’ report.

Endeavor Crude, LLC and Meridian Equipment Leasing, LLC

Notes to the Combined Financial Statements

(7)

Long-term Debt

	Long-term debt as of December 31, 2023 consisted of the following:
	Note payable to Ford Credit dated November 1, 2019, payable in 54 monthly installments of $860 at 8.6% interest. Note is collateralized by a 2019 Ford Explorer.			3,008
	Note payable to B1Bank dated February 12, 2020, payable in 48 monthly installments of $7,278 at 5.5% interest. Note is collateralized by 6 Dragon tractor trailers.			13,985
	Main Street Lending Priority Loan Agreement with Business First Bank dated November 12, 2020. Interest accrues at the LIBOR rate plus 3% per annum; maturing on November 12, 2025; secured by substantially all assets of the Company.			10,760,805
	Note payable to the U.S. Small Business Administration dated June 16, 2020, payable in 348 monthly installments of $731 beginning June 16, 2021 at 3.75% interest. Note is collateralized by substantially all assets of the Company.			160,000
	Note payable to Ally Financial dated July 30, 2021, payable in 60 monthly installments of $1,645 at 6.24% interest. Note is collateralized by a 2020 Dodge Challenger.			50,393
	Note payable to TD Ameritrade dated January 4, 2021, payable in 72 monthly installments of $991.21 at 6.89% interest. Note is collateralized by a 2019 Ford Expedition.			32,838
	Note payable to TD Ameritrade dated December 9, 2021, payable in 72 monthly installments of $1,434 at 4.94% interest. Note is collateralized by a 2018 Jeep Grand Cherokee.			62,378
	Note payable to Ally Financial dated December 24, 2021, payable in 60 monthly installments of $1,532 at 9.79% interest. Note is collateralized by a 2018 Ford Expedition.			46,684
	Note payable to Ford Credit dated March 31, 2023, payable in 60 monthly installments of $1,046 at 0.90% interest. Note is collateralized by a 2018 Ford F-150.			57,272
	Note payable to Ford Credit dated March 31, 2023, payable in 60 monthly installments of $1,093 at .9% interest. Note is collateralized by a 2022 Ford F-150.			60,249
	Notes payable to Small Business Administration dated April 10, 2020 and February 4, 2021, payable in 60 monthly installments of $30,374 and $35,024, respectively, at 1.00% interest. Notes are collateralized by the Company’s real and personal property.			2,482,360

See independent auditors’ report.

Endeavor Crude, LLC and Meridian Equipment Leasing, LLC

Notes to the Combined Financial Statements

(7)

Long-term Debt (continued)

Note payable to Ford Credit dated July 17, 2023, payable in 48 monthly installments of $1,622 at 9.99% interest. Note is collateralized by a 2021 Chevrolet Tahoe.	58,787
Note payable to TD Ameritrade dated January 6, 2023, payable in 72 monthly installments of $1,194 at 8.99% interest. Note is collateralized by a 2021 Ford F-250.	58,351
Note payable to Ally Financial dated February 27, 2023, payable in 72 monthly installments of $1,163 at 10.89% interest. Note is collateralized by a 2022 Ford F-150.	55,849
Note payable to Ford Credit dated July 7, 2023, payable in 48 monthly installments of $1,195 at 2.9% interest. Note is collateralized by a 2023 Ford F-150.	54,935
Note payable to Ford Credit dated September 8, 2023, payable in 48 monthly installments of $2,370 at 10.79% interest. Note is collateralized by a 2022 Dodge Charger.	86,854
Note payable to Pilot OFS Holdings, LLC dated December 31, 2023, payable in one lump sum payment of $12,500,000 plus all interest accrued at a rate of 10.5% on June 30, 2024. Note is collateralized by 405 various tractors, trucks, and trailers along with all related tools and supplies.	12,500,000
Note payable to Pilot OFS Holdings, LLC dated December 1, 2023, payable in 18 monthly installments of $90,431 at 10.5% interest. Note is collaterlized by 28 various tanker trailers.	1,500,000
Less: unamortized debt issuance costs	(96,095	)
Long-term debt, less unamortized debt issuance costs	27,948,653
Less: current portion	(14,843,727	)
Total long-term debt, less current portion	13,104,926

Following are maturities of long-term debt for each of the next five years:

	2024			14,843,727
	2025			10,727,026
	2026			2,162,737
	2027			115,025
	2028 & thereafter			100,138
	Totals			27,948,653

See independent auditors’ report.

Endeavor Crude, LLC and Meridian Equipment Leasing, LLC

Notes to the Combined Financial Statements

(8)

Finance Lease Obligations

On December 28, 2021, the Company entered into six finance leases with Maxus Capital Group, LLC (Maxus) for 57 trucks and tanker trailers.

The leases have terms of thirty-six (36) months with monthly installments ranging from $10,986 to $14,483 and the option to purchase the leased equipment at the end of the lease term ranging from $37,927 to $50,000. The Company is required to make a one-time security deposit payment for each lease ranging from $10,986 to $14,483 to be used in the event of a default by the Company. At the end of the terms, Maxus will return the balance of any security deposit payments.

The terms of the lease agreement, including the Company’s option to purchase the leased assets from Maxus at the end of the lease term, classify the lease as a finance lease in accordance with FASB ASC 842. As such, the Company has recorded a lease obligation equal to the present value of the future cash payments using the interest rate provided by Maxus Capital Group of 8.61%, as well as a lease asset equal to the present value of the future cash payments using an interest rate of 8.61% plus lease costs of $94,905 and prepaid lease payments of $111,555.

On April 21, 2022, the Company entered into two additional finance leases with Maxus, the first being for thirty (30) trucks and tanker trailers and the second being for two (2) tanker trailers.

Both leases have a term of thirty-six (36) months with monthly installments of $24,767 and $4,473 for the first and second lease, respectively. Both leases include an option to purchase the leased equipment at the end of the lease term for $83,400 and $15,000 for the first and second lease, respectively. The Company is required to make a one-time security deposit payment of $24,767 and $4,473 for the first and second lease, respectively, to be used in the event of a default by the Company. At the end of the terms, Maxus will return the balance of any security deposits.

The terms of the lease agreements, including the Company’s option to purchase the leased assets from Maxus at the end of the lease terms, classify the leases as finance leases in accordance with FASB ASC 842. As such, the Company has recorded lease obligations equal to the present value of the future cash payments using the interest rate provided by Maxus Capital Group of 10.44% and 10.19% for the first and second lease, respectively, as well as lease assets equal to the present value of the future cash payments using an interest rate of 10.44% and 10.19%, respectively, plus lease costs of $25,030 and $5,150 for the first and second lease, respectively.

See independent auditors’ report.

Endeavor Crude, LLC and Meridian Equipment Leasing, LLC

Notes to the Combined Financial Statements

(8)

Finance Lease Obligations (continued)

On December 22, 2022, the Company entered into two sale and leaseback transactions with Maxus. The Company assigned all of the assets comprising the pipeline system that was acquired from the acquisition of CPE Gathering Midcon, LLC to Maxus for consideration of $3,250,000 and $1,198,931 for the first and second sale, respectively. and entered into two lease agreements to lease the pipeline assets back from Maxus for 60 monthly payments of $56,803 and $20,955 for the first and second lease, respectively. At the end of the lease term, the Company has an option to purchase the pipeline assets back from Maxus for $1,218,762 and $449,604 for the first and second lease, respectively.

The Company has pledged 100% of its interests in the related pipeline assets as collateral for the lease obligations.

The Company is required to make one-time security deposit payments of $56,803 and $20,955 for the first and second lease, respectively, to be used in the event of a default by the Company. In addition, the Company is required to make minimum cash reserve payments of at least $18,934 and $6,985 for the first and second lease, respectively, each month in addition to the base lease payments until Maxus has received $681,640 and $251,458 for the first and second lease, respectively. The cash reserve payments are to be used in the event of default by the Company. All security deposit amounts as well as cash reserve amounts will be fully refunded to the Company at the end of the lease term. As of December 31, 2023, the balance of cash reserve payments made under these lease obligations was $311,033.

The terms of the lease agreement, including the Company’s option to purchase the pipeline assets from Maxus at the end of the lease term, preclude the Company from using sale and leaseback accounting treatment in accordance with FASB ASC-842-40. As such, the transaction is being accounted for as a financing arrangement, whereby the Company does not record a sale or derecognize the pipeline assets. The Company continues to record depreciation expense on the pipeline assets and has recorded a financial liability due to Maxus (included in Finance lease obligations in the accompanying balance sheet).

The Company is using imputed interest rates of 16.85% and 17.39% for the first and second lease, respectively, which results in the carrying value of the financial liability equating the estimated book value of the pipeline assets at the end of the lease terms and the date at which the Company may exercise its buy-back option.

See independent auditors’ report.

Endeavor Crude, LLC and Meridian Equipment Leasing, LLC

Notes to the Combined Financial Statements

(8)

Finance Lease Obligations (continued)

On March 22, 2023, the Company entered into three (3) additional finance leases with Maxus for 90 trucks and tanker trailers.

The leases have terms of thirty-six (36) months with monthly installments ranging from $14,443 to $37,865 and the option to purchase the leased equipment at the end of the lease term ranging from $47,586 to $124,758. The Company is required to make a one-time security deposit payment for each lease ranging from $14,443 to $37,865 to be used in the event of a default by the Company. At the end of the terms, Maxus will return the balance of any security deposit payments.

The terms of the lease agreements, including the Company’s option to purchase the leased assets from Maxus at the end of the lease terms, classify the leases as finance leases in accordance with FASB ASC 842. As such, the Company has recorded lease obligations equal to the present value of the future cash payments using the interest rate implicit in the leases of 11.56% as well as lease assets equal to the present value of the future cash payments using an interest rate of 11.56%.

On November 20, 2023, the Company entered into five (5) additional finance leases with Maxus for one hundred and five (105) trucks and tanker trailers.

The leases have terms of thirty-six (36) months with monthly installments ranging from $23,192 to $75,217 and the option to purchase the leased equipment at the end of the lease term ranging from $74,000 to $240,000. The Company is required to make a one-time security deposit payment for each lease ranging from $23,192 to $75,217 to be used in the event of a default by the Company. At the end of the terms Maxus will return the balance of any security deposit payments.

The terms of the lease agreements, including the Company’s option to purchase the leased assets from Maxus at the end of the lease terms, classify the leases as finance leases in accordance with FASB ASC 842. As such, the Company has recorded lease obligations equal to the present value of the future cash payments using the implicit borrowing rate of similar leases with Maxus for similar assets and terms of 11.56% as well as lease assets equal to the present value of the future cash payments using an interest rate of 11.56% plus lease costs of $302,750 and prepaid lease payments of $235,054.

See independent auditors’ report.

Endeavor Crude, LLC and Meridian Equipment Leasing, LLC

Notes to the Combined Financial Statements

(8)

Finance Lease Obligations (continued)

Future minimum lease payments for each of the next five years under the Maxus lease obligation and a reconciliation of undiscounted cash flows to the balance of the lease obligation as of December 31, 2023 on the accompanying combined balance sheet are as follows:

2024	6,200,710
2025	4,911,823
2026	4,462,499
2027	855,340
Total minimum lease payments	16,430,372
Less: amount representing interest	(4,189,714	)
Present value of net minimum payments	12,240,658
Add: carrying value of lease obligation at end of lease term	2,832,813
Total lease obligation	15,073,471
Less: unamortized financing fees	(99,720	)
Total lease obligation, less unamortized financing fees	14,973,751
Less: current portion	(6,200,710	)
Total lease obligation, less current portion	8,773,041

(9)

Operating Lease Liabilities

On May 1, 2021, and December 16, 2021, the Company entered into operating leases with Monahans Commercial Properties, LLC (Monahans) and Glacier Oilfield Services, Inc. (Glacier) for the use of corporate office space with terms of 60 months and 36 months with monthly installments of $10,000 and $4,000, respectively.

The terms of the lease agreement classify the lease as an operating lease in accordance with FASB ASC 842. As such, the Company has recorded a lease obligation as well as a lease asset equal to the present value of the future cash payments. In determining the discount rate for the calculation of future cash payments, the Company used the risk-free discount rate of .857% for Monahans and .948% for Glacier, which are the rates of a U.S. government bond as of the commencement dates of the leases and for a term comparable to the respective lease terms.

As part of the business acquisition of ET, dated December 22, 2023, Meridian assumed three (3) leases with Pilot Water Solutions SWD, LLC for the use of trucking yards, shops, and a housing development to be used in trucking operations. The terms of the leases range from twenty-four (24) to thirty-six (36) with monthly installments ranging from $5,750 to $138,395.

See independent auditors’ report.

Endeavor Crude, LLC and Meridian Equipment Leasing, LLC

Notes to the Combined Financial Statements

(9)

Operating Lease Liabilities (continued)

The terms of the lease agreements classify the leases as operating leases in accordance with FASB ASC 842. As such, the Company has recorded a lease obligation as well as a lease asset equal to the present value of the future cash payments. In determining the discount rate for the calculation of future cash payments, the Company used the risk-free discount rate of 4.336% and 4.042%, which are the rates of a U.S. government bonds as of the commencement dates of the leases and for a term comparable to the respective lease terms.

Under the provisions of ASC 842, the Company has elected the practical expedient to not separate nonlease components from lease components and instead will account for each separate lease component and the related nonlease components as a single lease component. The Company has made this election for all operating leases.

Future minimum lease payments for each of the next three years under the operating lease obligations and a reconciliation of the undiscounted cash flows to the balance of the operating lease obligation as of December 31, 2023 on the accompanying combined balance sheet are as follows:

2024	2,486,740
2025	2,431,740
2026	978,975
Total minimum lease payments	5,897,455
Less: amount representing interest	(246,629	)
Total lease obligation	5,650,826
Less: current portion	(2,486,740	)
Total lease obligation, less current portion	3,164,086

See independent auditors’ report.

Endeavor Crude, LLC and Meridian Equipment Leasing, LLC

Notes to the Combined Financial Statements

(10)

Business Combination

On December 22, 2023, Meridian acquired 100% of the security interest in ET, a limited liability company in the business of crude oil transportation through the use of trucking equipment, for cash consideration of $12,500,000, making ET a wholly owned subsidiary of Meridian. Meridian did not assume any liabilities of ET as a result of the purchase. Included in the assets acquired by the Company were trade accounts receivable that have a fair market value of $1,500,000 and are believed to be 100% collectible. The fair value of net assets acquired was estimated to equal the amount of consideration paid by Meridian.

The following is a list of net identifiable assets at estimated fair value assumed as of the date of the acquisition:

	Total cash consideration			12,500,000
	Purchase price allocation:
	Accounts receivable			1,500,000
	Inventory			46,784
	Property and equipment, net			10,953,216
	Net assets acquired			12,500,000

(11)

Line of Credit

On January 6, 2023, the Company entered into an accounts receivable factoring agreement with a financial institution that allows the Company to sell their currently outstanding accounts receivable for cash up to a maximum principal balance of $7,500,000 (hereinafter referred to as line of credit). The Company is charged a service charge by the institution in the amount of 1% of all receivables purchased. The agreement states that if a receivable becomes 120 days or more outstanding, then the institution may require the Company to repurchase the account at face value. To facilitate the potential buyback, the agreement states that the Company must keep a reserve account with the institution in an amount equal to 10% of all purchased accounts. The outstanding principal balance of the line of credit was $5,575,005 as of December 31, 2023. The amount of the reserve account was $1,262,525 as of December 31, 2023 and is included in restricted cash in the accompanying combined balance sheet.

See independent auditors’ report.

Endeavor Crude, LLC and Meridian Equipment Leasing, LLC

Notes to the Combined Financial Statements

(12)

Interest Rate Swap

During February 2022 the Company entered into an interest rate swap contract associated with its Main Street Lending Priority Loan (See Note 7). The Company used the interest rate swap to manage risks related to interest rate movements and effectively converted this variable rate debt into a fixed-rate borrowing at 3.92% on a notional amount of $10,000,000. The swap contract settled monthly. On May 11, 2023, the Company terminated its swap agreement with Citibank N.A. The Company recorded a net gain of $686,096 included in other income in the accompanying combined statement of income.

(13)

Short-Term Borrowings

On November 20, 2023, the Company entered into a short-term financing agreement with Maxus for a principal amount of $1,500,000. The Company will make interest only payments monthly until the maturity of the note, upon which all outstanding principal and accrued interest is due. The note was originally scheduled to mature six months from the date of borrowing and was subsequently extended an additional six months to a maturity date of November 20, 2024. The note is collateralized by twenty-eight (28) trucks and tanker trailers.

(14)

Adoption of New Accounting Standard

In June 2016, the FASB issued guidance (FASB ASC 326) which significantly changed how entities will measure credit losses for most financial assets and certain other instruments that aren’t measured at fair value through net income. The most significant change in this standard is a shift from the incurred loss model to the expected loss model. Under the standard, the disclosures are required to provide users of the financial statements with useful information in analyzing an entity’s exposure to credit risk and the measurement of credit losses. Financial assets held by the company that are subject to the guidance in FASB ASC 326 were trade accounts receivable.

The Company adopted the standard effective January 1, 2023. The impact of the adoption was not considered material to the combined financial statements.

(15)

Subsequent Events

On March 21, 2024, the members of the Company entered into a Membership Interest Purchase Agreement with Vivakor, Inc. (“Vivakor”), whereby, at closing, Vivakor will acquire 100% of the membership interests of the Company.

See independent auditors’ report.

Endeavor Crude, LLC and Meridian Equipment Leasing, LLC

Notes to the Combined Financial Statements

(15)

Subsequent Events (continued)

Vivakor’s acquisition of 100% of the membership interests of the Company is subject to various closing conditions. As of the date the financial statements were available to be issued, the acquisition has not yet officially occurred.

See independent auditors’ report.

Exhibit 99.2

Silver Fuels Processing, LLC

Audited Financial Statements

as of and for the years ended

December 31, 2023 and 2022

Silver Fuels Processing, LLC

Notes to the Financial Statements

Independent Auditors’ Report		1-2

Balance Sheets as of December 31, 2023 and 2022		3

Statements of Operations for the years ended December 31, 2023 and 2022		4

Statements of Members’ Equity for the years ended December 31, 2023 and 2022		5

Statements of Cash Flows for the years ended December 31, 2023 and 2022		6

Notes to the Financial Statements		7-10

INDEPENDENT AUDITORS’ REPORT

Management

Silver Fuels Processing, LLC

Dallas, Texas

Opinion

We have audited the accompanying financial statements of Silver Fuels Processing, LLC, which comprise the balance sheets as of December 31, 2023 and 2022 and the related statements of operations, members’ equity, and cash flows for the years then ended, and the related notes to the financial statements.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Silver Fuels Processing, LLC, as of December 31, 2023 and 2022 and the results of its operations and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinion

We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of Silver Fuels Processing, LLC and to meet our other ethical responsibilities in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Related-Party Transactions

As discussed in Notes 4 and 5 to the accompanying financial statements, all revenues are derived from an entity in which the Company’s manager also controls. Our opinion is not modified with respect to that matter.

Responsibilities of Management for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about Silver Fuels Processing, LLC’s ability to continue as a going concern within one year after the date that the financial statements are available to be issued.

Auditors’ Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements, including omissions, are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

In performing an audit in accordance with generally accepted auditing standards, we:

●

Exercise professional judgment and maintain professional skepticism throughout the audit.

●

Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

●

Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of Silver Fuels Processing, LLC’s internal control. Accordingly, no such opinion is expressed.

●

Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about Silver Fuels Processing, LLC’s ability to continue as a going concern for a reasonable period of time

Shreveport, Louisiana

June 6, 2024

Silver Fuels Processing, LLC

Balance Sheets

as of December 31, 2023 and 2022

	2023		2022
Assets
Current assets
Cash and cash equivalents		5,990		47,015
Accounts receivable, Note 2		64,037		20,383
Prepaid expense		63,309		45,659
Total current assets		133,336		113,057

Property and equipment, net, Notes 2 and 3		1,157,113		724,244

Other Assets
Utility deposits		2,992		2,992
Total other assets		2,992		2,992

Total assets		1,293,441		840,293

Liabilities and members’ equity
Current liabilities
Accounts payable		325,807		47,674
Total current liabilities		325,807		47,674

Members’ equity		967,634		792,619

Total liabilities and members’ equity		1,293,441		840,293

See independent auditors’ report and accompanying notes to the financial statements.

Silver Fuels Processing, LLC

Statements of Operations

for the years ended December 31, 2023 and 2022

	2023			2022
Sales income		630,000			600,000

Operating expenses
Equipment		16,982			0
License and permits		50			0
Bank charges		160			40
Depreciation		252,147			235,661
Insurance		88,249			16,095
Miscellaneous		9,732			24,231
Office supplies		545			252
Payroll		74,925			89,538
Professional fees		36,023			21,723
Repairs and maintenance		53,841			32,531
Travel		23,723			13,656
Utilities		28,581			13,606
Rent		59,000			82,000
Contract labor		0			10,243
Billable		0			15,241
Bad debt		0			6,451
Station		2,219			147,882
Total operating expenses		646,177			709,150

Loss from operations		(16,177	)		(109,150	)

Other income (expenses)
Miscellaneous income		126,682			290,856
Other income		33,750			0
Total other income		160,432			290,856

Net income		144,255			181,706

See independent auditors’ report and accompanying notes to the financial statements.

Silver Fuels Processing, LLC

Statements of Members’ Equity

for the years ended December 31, 2023 and 2022

Balance, December 31, 2021	997,757

Net income	181,706
Members’ contributions	546,603
Members’ distributions	(933,447	)

Balance, December 31, 2022	792,619

Net income	144,255
Members’ contributions	695,201
Members’ distributions	(664,441	)

Balance, December 31, 2023	967,634

See independent auditors’ report and accompanying notes to the financial statements.

Silver Fuels Processing, LLC

Statements of Cash Flows

for the years ended December 31, 2023 and 2022

	2023			2022
Cash flows from operating activities
Net income		144,255			181,706
Adjustments to reconcile net income to net cash provided by operating activities:
Bad debt		0			6,451
Depreciation		252,147			235,661
(Increase) decrease in:
Accounts receivables		(678,096	)		(266,535	)
Prepaid expenses		(17,650	)		(45,659	)
Increase (decrease) in:
Accounts payable		520,835			(67,986	)
Due to affiliates		245,000			0
Net cash provided by operating activities		466,491			43,638

Cash flows from investing activities
Purchases of property and equipment		(685,016	)		(138,538	)
Net cash used in investing activities		(685,016	)		(138,538	)

Cash flows from financing activities
Contributions from members		207,499			459,600
Distributions to members		(29,999	)		(320,223	)
Net cash provided by financing activities		177,500			139,377

Net change in cash and cash equivalents		(41,025	)		44,477

Beginning cash and cash equivalents		47,015			2,538

Ending cash and cash equivalents		5,990			47,015

Supplementary non-cash investing and financing activities:
Assignment of related-party receivables to parent through distributions		634,442			613,224
Assumption of related-party payables by parent through contributions		487,701			87,003

See independent auditors’ report and accompanying notes to the financial statements.

Silver Fuels Processing, LLC

Notes to the Financial Statements

(1)

Nature of Business

Silver Fuels Processing, LLC, (the “Company”), organized in January 2018, owns, and operates crude oil transfer stations in Texas, New Mexico, and North Dakota. The Company has operated the stations since June of 2018. The Company is a Texas limited liability company in which Jorgan Development (“Jorgan”) (a Louisiana limited liability company) owns 99% of the equity interest and JBAH Holdings, LLC (“JBAH”) (a Texas limited liability company) owns the remaining 1% of equity interest.

(2)

Summary of Significant Accounting Policies

Basis of accounting – The financial statements of the Company have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.

Basis of presentation and use of estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Cash and cash equivalents – For the purpose of reporting cash flows, cash and cash equivalents include all cash on hand and cash on deposit with maturities of less than three months.

Accounts receivable – Accounts receivable primarily relate to advances of operating expenses for related parties and fees charged to customers (all related parties) for the right to use the Company’s crude oil transfer stations to transport their crude oil along various oil pipelines. Differences in the amounts due from customers and the amounts management expects to collect are reported in the results of operations of the year in which those differences are determined. Once management has used reasonable collection efforts, any balance determined to be uncollectible is written off directly through a charge to bad debt expense or distributions with a credit entry to an accounts receivable. Bad debt expense for the years ended December 31, 2023 and 2022 was $0 and $6,451, respectively. Accounts receivable are zero-interest bearing.

Property and equipment – Property and equipment is stated at cost. Depreciation is computed by the straight-line method over the assets’ estimated useful lives ranging from 5 to 7 years.

See independent auditors’ report.

Silver Fuels Processing, LLC

Notes to the Financial Statements

(2)

Summary of Significant Accounting Policies (continued)

Revenue recognition – The Company derives its revenues from fees charged to its customer for the use of their crude oil transfer stations to transport oil along various pipelines. The Company has one performance obligation in the form of allowing customers to utilize their transfer stations. The Company has determined that the customer has obtained the promised service when the customer successfully utilizes the Company’s transfer station to transport oil, as such, the Company recognizes revenue at the point in time that the transfer stations are utilized by the customer.

Income taxes – The Company is a limited liability company that is taxed as a partnership for federal and state income tax purposes. As such, the Company does not pay income taxes, as any income or loss and credits are included in the tax returns of the individual partners. Accordingly, no provision has been made for income taxes in the financial statements.

Advertising – The Company’s policy is to expense advertising costs as they are incurred. Advertising costs for the years ended December 31, 2023 and 2022 were $0 and $0, respectively.

Subsequent events – Management of the Company has evaluated subsequent events, for recognition and disclosure, through June 6, 2024, the date the financial statements were available to be issued. See note 7.

(3)

Property and Equipment

The following is a summary of property and equipment as of December 31, 2023 and 2022:

	2023		2022
Basa station		1,137,216		486,781
Midland station		87,581		53,000
Posse Monroe station		689,557		689,557
Wasson station		376,711		376,711
Steel Tanks		64,175		64,175
Sub-total	$	2,355,240	$	1,670,224
Less: accumulated depreciation		1,198,127		945,980
Totals	$	1,157,113	$	724,244

Depreciation expense related to property and equipment for the years ended December 31, 2023 and 2022 was $252,147 and $235,661, respectively.

See independent auditors’ report.

Silver Fuels Processing, LLC

Notes to the Financial Statements

(4)

Related-Party Transactions

During the years ended December 31, 2023 and 2022, the Company made substantially all of its sales to White Claw Crude, LLC (“WCC”), a related-party owned and managed by Jorgan Development (“Jorgan”), a Louisiana limited liability company, the majority owner of the Company. The total sales made by the Company to WCC during the years ended December 31, 2023 and 2022 was $630,000 and $600,000, respectively.

During the year ended December 31, 2021 (the “Effective Date”), the Company entered into a 10- year take or pay agreement (the “Agreement”) with WCC. The Agreement requires that WCC transports greater than or equal to 200,000 barrels per month, the minimum volume commitment (“MVC”), through the Company’s crude transfer stations at a rate of $0.25 per barrel, for the period beginning on the Effective Date and ending June 30, 2023, and $0.275 per barrel, for the period beginning on July 1, 2023 and ending upon the expiration of the Agreement, for quantities up to the MVC and $0.125 for amounts that exceed the MVC. Under the terms of the Agreement, each month WCC does not meet the MVC, it is responsible for paying the Company the amount equal to the MVC times the applicable rate.

The Company rents crude oil stations on a month-to-month basis from Endeavor Crude, LLC, a related party owned and managed by Jorgan. Total rent expense related to this lease was $59,000 and $67,500 for the years ended December 31, 2023 and 2022, respectively, and is included in rent expense on the accompanying statements of operations.

During the years ended December 31, 2023 and 2022, the Company paid for operating expenses on behalf of various related parties under common management. As of December 31, 2023 and 2022, the Company was owed $64,037 and $20,383, respectively, from its various related parties.

As described in Note 2, substantially all of the Company’s accounts receivable are due from related parties. Such amounts due as of December 31, 2023 and 2022 were $64,037 and $20,383, respectively.

(5)

Major Customers and Concentration of Credit Risk

The Company’s only customer is WCC. WCC accounts for 100% of the Company’s revenue as of December 31, 2023 and 2022.

Additionally, the Company and WCC operate in the crude oil industry. The industry concentration has the potential to impact the Company’s overall exposure to credit risk in that WCC may be similarly affected by changes in economic, industry, or other conditions. There is a risk that the Company would not be able to identify and access replacement markets at comparable margins.

See independent auditors’ report.

Silver Fuels Processing, LLC

Notes to the Financial Statements

(6)

Adoption of New Accounting Standards

In February 2016, the FASB issued ASU No. 2016-02 (“ASC 842”), Leases, to require lessees to recognize all leases, with certain exceptions, on the balance sheet, while recognition on the statement of income will remain similar to current lease accounting. ASC 842 eliminates real estate-specific provisions and modifies certain aspects of lessor accounting. This standard is effective for annual periods beginning after December 15, 2021, with early adoption permitted.

The Company adopted ASC 842 as of January 1, 2021. Adoption of this standard did not have a material impact on the Company’s financial statements as the party is not a party to any long-term leasing arrangements.

The Company has elected not to present short-term leases on the balance sheet as these leases have a lease term of 12 months or less at lease inception and do not contain purchase options that are reasonably certain to be exercised.

In June 2016, the FASB issued guidance (“ASC 326”) which significantly changed how entities will measure credit losses for most financial assets and certain other instruments that aren’t measured at fair value through net income. The most significant change in this standard is a shift from the incurred loss model to the expected loss model. Under the standard, disclosures are required to provide users of the financial statements with useful information in analyzing an entity’s exposure to credit risk and the measurement of credit losses. The Company did not have significant financial assets that are subject to the guidance in ASC 326. Specifically, the Company’s accounts receivable are substantially all related-party receivables from companies under common ownership. FASB ASC 326 excludes such receivables from the expected loss model.

The Company adopted the standard effective January 1, 2023. The impact of the adoption was not considered material to the financial statements.

(7)

Subsequent Events

See independent auditors’ report.

Exhibit 99.3

Endeavor Crude, LLC, Meridian Equipment

Leasing, LLC, and Equipment Transport, LLC

Combined Financial Statements

as of June 30, 2024 and December 31, 2023 and

for the three-month and six-month periods

ended June 30, 2024 and 2023

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC,

and Equipment Transport, LLC

Table of Contents

Independent Auditors’ Review Report		1-2

Combined Balance Sheets as of June 30, 2024 (Unaudited) and December 31, 2023		3

Combined Statements of Operations for the three-month and six-month periods ended June 30, 2024 and 2023 (Unaudited)		4

Combined Statements of Members’ Equity for the three-month and six-month periods ended June 30, 2024 and 2023 (Unaudited)		5

Combined Statements of Cash Flows for the six-month periods ended June 30, 2024 and 2023 (Unaudited)		6

Notes to the Combined Financial Statements (Unaudited)		7-27

INDEPENDENT AUDITORS’ REVIEW REPORT

Management

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC,

and Equipment Transport, LLC

Dallas, Texas

Results of Review of Interim Financial Information

We have reviewed the accompanying combined financial statements of Endeavor Crude, LLC, Meridian Equipment, LLC, and Equipment Transport, LLC, which comprise the combined balance sheet as of June 30, 2024 and the related combined statements of operations and members’ equity for the three-month and six-month periods ended June 30, 2024 and 2023, and statements of cash flows for the six-month periods ended June 30, 2024 and 2023, and the related notes to the combined financial statements (collectively referred to as the “interim financial information”).

Based on our reviews, we are not aware of any material modifications that should be made to the accompanying interim financial information for it to be in accordance with accounting principles generally accepted in the United States of America.

Basis for Review Results

We conducted our reviews in accordance with auditing standards generally accepted in the United States of America (GAAS) applicable to reviews of interim financial information. A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. A review of interim financial information is substantially less in scope than an audit in accordance with GAAS, the objective of which is the expression of an opinion regarding the financial information as a whole, and accordingly, we do not express such an opinion. We are required to be independent of Endeavor Crude, LLC, Meridian Equipment Leasing, LLC, and Equipment Transport, LLC and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements related to our reviews. We believe that the results of the review procedures provide a reasonable basis for our conclusion.

Substantial Doubt About the Company’s Ability to Continue as a Going Concern

The accompanying financial information has been prepared assuming that the Company will continue as a going concern. As discussed in Note 17 to the interim financial information, the Company was in default under certain promissory notes. The Company has been unable to obtain an extension to pay under its obligations, has been unable to obtain alternative financing, and has stated that substantial doubt exists about the Company’s ability to continue as a going concern. Management’s evaluation of the conditions and events and management’s plans regarding those matters are also described in Note 17. The accompanying interim financial information does not include any adjustments that might result from the outcome of that uncertainty.

Responsibilities of Management for the Interim Financial Information

Management is responsible for the preparation and fair presentation of the interim financial information in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of interim financial information that is free from material misstatement, whether due to fraud or error.

Report on Balance Sheet as of December 31, 2023

We have previously audited, in accordance with GAAS, the balance sheet as of December 31, 2023, and the related statement of income, members’ equity, and cash flows for the year then ended (not presented herein); and we expressed an unmodified opinion on those audited financial statements in our report dated June 6, 2024. In our opinion, the accompanying balance sheet of Endeavor Crude, LLC, Meridian Equipment Leasing, LLC, and Equipment Transport, LLC as of December 31, 2023, is consistent, in all material respects, with the audited financial statements from which it has been derived.

Shreveport, Louisiana

September 11, 2024, except for Note 3, as to which the date is December 6, 2024

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC,

and Equipment Transport, LLC

Combined Balance Sheets

as of June 30, 2024 (Unaudited) and December 31, 2023

	June 30, 2024 (Unaudited)		December 31, 2023
Assets
Current assets
Cash		1,122,432		1,164,555
Restricted cash, Note 12		2,630,164		1,262,525
Trade accounts receivable, net of allowance for credit losses of $63,064 and $24,531 as of June 30, 2024 and December 31, 2023, respectively, Note 2		23,712,411		11,679,862
Prepaid expenses		3,193,156		546,655
Due from related party, Note 6		1,684,310		245,368
Inventory, Note 2		134,810		46,784
Total current assets		32,477,283		14,945,749

Property and equipment, net, Notes 2 and 5		61,738,454		65,895,192

Other assets
Right-of-use asset - operating, Note 10		4,424,081		5,657,160
Intangible assets, net, Note 2		1,476,652		2,953,305
Other assets		1,194,614		871,655
Total other assets, net		7,095,347		9,482,120

Total assets		101,311,084		90,323,061

Liabilities and members’ equity
Current liabilities
Trade payables		7,990,960		1,151,741
Accrued liabilities		8,943,207		5,562,998
Due to related party, Note 6		1,784,994		1,653,755
Line of credit, Note 12		13,409,798		5,575,005
Short-term notes payable, Note 14		6,818,560		2,345,552
Current portion of finance lease obligations, Note 9		3,195,725		6,200,710
Current portion of operating lease obligations, Note 10		1,240,870		2,486,740
Current portion of long-term debt, Note 8		14,779,232		14,843,727
Total current liabilities		58,163,346		39,820,228

Long-term liabilities
Finance lease obligations - less current portion, Note 9		9,705,171		8,773,041
Operating lease obligations - less current portion, Note 10		3,241,445		3,164,086
Long-term debt - less current portion, Note 8		12,978,246		13,104,926
Total long-term liabilities		25,924,862		25,042,053

Members’ equity		17,222,876		25,460,780

Total liabilities and members’ equity		101,311,084		90,323,061

See independent auditors’ review report and accompanying notes to the combined financial statements.

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC,

and Equipment Transport, LLC

Combined Statements of Operations

for the three-month and six-month periods ended June 30, 2024 and 2023 (Unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
	2024			2023			2024			2023
Revenues
Sales		22,123,019			12,592,022			44,631,086			25,738,605
Reimbursed expenses - related party		1,158,277			0			2,207,336			0
Total revenues		23,281,296			12,592,022			46,838,422			25,738,605

Operating expenses
Operating		41,281			0			85,497			0
Auto		1,095,020			186,291			2,422,773			472,474
Credit losses		120,092			0			120,092			0
Bank charges		6,490			155			31,208			267
Business taxes		15,539			43,898			29,061			110,271
Computer		264,703			97,065			580,583			205,803
Consulting		14,517			0			28,678			0
Contract labor		8,597,382			6,512,830			17,159,999			14,125,873
Depreciation		2,950,658			1,740,483			5,833,126			3,259,235
Employee benefits		144,903			59,533			234,646			97,223
Insurance		767,735			18,739			1,370,550			24,985
Inspections		3,027			669			38,391			2,346
Licenses and permits		32,108			42,185			82,475			105,195
Meals		646			263			914			367
Miscellaneous		51,217			501			75,211			3,583
Office		94,252			3,202			279,162			3,862
Payroll taxes		88,397			43,204			178,453			105,082
Postage		972			0			4,682			0
Professional fess		120,163			70			179,740			34,709
Repairs and maintenance		611,536			328,949			851,692			723,195
Regulatory		65,712			750			120,205			750
Training		0			911			0			1,086
Travel		48,709			57,622			92,327			118,583
Utilities		89,649			72,643			156,600			148,597
Tools		0			338			700			338
Supplies		58,532			23,368			85,888			45,300
Employee costs		15,102			30,779			20,877			60,156
Lease		977,365			120,377			1,981,739			237,685
Amortization		800,982			309,600			2,057,863			619,200
Salaries and wages		5,301,294			861,393			11,600,491			1,705,358
Total operating expenses		22,377,983			10,555,818			45,703,623			22,211,523

Income from operations		903,313			2,036,204			1,134,799			3,527,082

Other income (expense)
Other income		18,184			643,216			83,500			698,580
Other expense		0			(64,155	)		0			(64,155	)
Interest income		19,708			49,247			35,500			51,892
Gain (loss) on sale of assets		(18,630	)		0			(18,630	)		(26,031	)
Interest expense		(1,952,622	)		(817,667	)		(3,825,511	)		(1,533,237	)
Total other income (expense)		(1,933,360	)		(189,359	)		(3,725,141	)		(872,951	)

Net income (loss)		(1,030,047	)		1,846,845			(2,590,342	)		2,654,131

See independent auditors’ review report and accompanying notes to the combined financial statements.

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC,

and Equipment Transport, LLC

Combined Statements of Members’ Equity

for the three-month and six-month periods ended June 30, 2024 and 2023 (Unaudited)

	Accumulated Other Comprehensive Income			Members’ Equity			Total
Balance, March 31, 2024 (Unaudited)		0			19,819,940			19,819,940

Net loss		0			(1,030,047	)		(1,030,047	)
Members’ contributions		0			5,172,610			5,172,610
Members’ distributions		0			(6,739,627	)		(6,739,627	)

Balance, June 30, 2024 (Unaudited)		0			17,222,876			17,222,876

Balance, December 31, 2023		0			25,460,780			25,460,780

Net loss		0			(2,590,342	)		(2,590,342	)
Members’ contributions		0			7,450,179			7,450,179
Members’ distributions		0			(13,097,741	)		(13,097,741	)

Balance, June 30, 2024 (Unaudited)		0			17,222,876			17,222,876

Balance, March 31, 2023 (Unaudited)		0			29,196,981			29,196,981

Net income		0			1,846,845			1,846,845
Members’ contributions		0			1,196,999			1,196,999
Members’ distributions		0			(916,000	)		(916,000	)

Balance, June 30, 2023 (Unaudited)		0			31,324,825			31,324,825

Balance, December 31, 2022		28,884			30,990,723			31,019,607

Amounts reclassified from accumulated other comprehensive income		(28,884	)		28,884			0

Net income		0			2,654,131			2,654,131
Members’ contributions		0			1,992,499			1,992,499
Members’ distributions		0			(4,341,412	)		(4,341,412	)

Balance, June 30, 2023 (Unaudited)		0			31,324,825			31,324,825

See independent auditors’ review report and accompanying notes to the combined financial statements.

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC,

and Equipment Transport, LLC

Combined Statements of Cash Flows

for the six-month periods ended June 30, 2024 and 2023 (Unaudited)

	Six Months Ended June 30,
	2024			2023
Cash flows from operating activities
Net income (loss)		(2,590,342	)		2,654,131
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Credit losses		120,092			0
Depreciation		5,833,126			3,259,235
Amortization		1,476,653			619,200
Loss on disposal of assets		18,630			26,031
Gain on sale of interest rate swap agreement		0			(594,000	)
Capitalization of interest expense		670,774			0
Amortization of debt issuance costs		89,888			38,673
(Increase) decrease in:
Trade accounts receivable		(16,811,000	)		(5,545,930	)
Inventory		(88,026	)		493,136
Prepaid expenses		(5,225,936	)		(2,443,997	)
Due from related party		(1,438,942	)		0
Other current assets		0			34,671
Other assets		(322,959	)		(177,819	)
Note receivable		0			12,125
Increase (decrease) in:
Trade payables		4,404,152			(3,053,325	)
Accrued liabilities		6,599,644			1,984,115
Due to related party		131,239			0
Other liabilities		0			(75,000	)
Net cash used in operating activities		(7,133,007	)		(2,768,754	)

Cash flows from investing activities
Purchases of property and equipment		(642,854	)		(112,475	)
Proceeds from sale of assets		68,700			135,144
Net cash provided by (used in) investing activities		(574,154	)		22,669

Cash flows from financing activities
Net borrowings on line of credit		7,866,164			4,403,274
Net borrowings on short-term debt		4,540,418			0
Repayments of finance lease obligations		(2,085,321	)		(931,303	)
Repayments on long-term debt		(888,157	)		(405,903	)
Debt issuance costs incurred		(149,995	)		0
Members’ contributions		3,282,568			1,970,499
Members’ distributions		(3,533,000	)		(480,412	)
Net cash provided by financing activities		9,032,677			4,556,155

Net change in cash and cash equivalents		1,325,516			1,810,070

Beginning cash and cash equivalents		2,427,080			2,085,508

Ending cash and cash equivalents		3,752,596			3,895,578

Supplemental disclosure of cash flow information
Cash paid for interest		3,064,849			1,496,587

Supplementary non-cash investing and financing activities
Assignment of related-party receivables to parent through distributions		8,664,741			594,000
Assumption of related-party payables through distributions		900,000			3,267,000
Assumption of related-party receivables through contributions		0			22,000
Assumption of related-party payables by parent through contributions		4,167,611			0

See independent auditors’ review report and accompanying notes to the combined financial statements.

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(1)

Nature of Business

Endeavor Crude, LLC (“Endeavor”), Meridian Equipment Leasing, LLC (“Meridian”), and Equipment Transport, LLC (“ET”) (collectively, the “Company” or “Companies”) is primarily engaged in the business of crude oil transportation. Endeavor and Meridian are privately held Texas limited liability companies. ET is a privately held Pennsylvania limited liability company and CPE Gathering Midcon, LLC (“CP”), a wholly-owned subsidiary of Meridian, is a privately held Delaware limited liability company.

Endeavor was formed in February 2019 and began operations in April 2019. Meridian was formed in April 2019 and began operations in May 2019 through the acquisition of real estate and trucking assets. Endeavor’s primary activity of generating revenue is the transportation of crude oil through its operation of a fleet of trucks and trailers primarily servicing Texas and New Mexico. Meridian is the owner of this fleet of trucks and trailers. Meridian’s primary activity of generating revenue is the leasing of these trucks and trailers to Endeavor.

In December 2023, Meridian acquired 100% of the membership interests in ET through a business combination, see Note 11. In January 2024, Meridian transferred 100% of its membership interests in ET to its parent, Jorgan Development, LLC. ET owns and operates a fleet of trucks and trailers used in the transportation of crude oil and gas.

(2)

Summary of Significant Accounting Policies

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(2)

Summary of Significant Accounting Policies (continued)

Cash and cash equivalents – Cash and cash equivalents include all cash on hand and cash on deposit with maturities of less than three months.

Trade accounts receivable and allowance for credit losses – The Company’s trade accounts receivable are primarily derived from trucking transportation customers. At each balance sheet date, the Company recognizes an expected allowance for credit losses. Also at each reporting date, this estimate is updated to reflect any changes in credit risk since the receivable was initially recorded. This estimate is calculated on a pooled basis where similar risk characteristics exist.

	Communications equipment		3 years
	Autos, trucks and trailers		5-7 years
	Buildings and improvements		15 years
	Pipeline and tanks		20 years

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(2)

Summary of Significant Accounting Policies (continued)

Intangible assets – Intangible assets consist of an acquired trucking contract that has been assigned a useful life of 5 years and transaction costs related to the purchase of ET that have been assigned a useful life of 1 year. The assets are being amortized on a straight-line basis.

Total amortization expense relating to the trucking contract was $0 and $309,600 for the three- month period ended June 30, 2024 and 2023, respectively, and $0 and $619,200 for the six-month period ended June 30, 2024 and 2023, respectively.

Total amortization expense relating to the transaction costs was $800,982 and $0 for the three- month period ended June 30, 2024 and 2023, respectively, and $2,057,863 and $0 for the six- month period ended June 30, 2024 and 2023, respectively.

Level 1 – Observable inputs, such as quoted prices in active markets for identical assets or liabilities.

Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(2)

Summary of Significant Accounting Policies (continued)

Inventory – Inventory is stated at the lower of cost or net realizable value, with cost being determined under the first-in, first-out method.

Revenue recognition – Substantially all revenue the Company earns is related to trucking fees charged to customers for gathering and transporting crude oil and gas products.

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(2)

Summary of Significant Accounting Policies (continued)

Debt issuance costs – Debt issuance costs represent costs incurred in relation to the Main Street Loan Credit Facility (see Note 8), Maxus lease obligations (see Note 9 and 14), and the Business First Bank line of credit (see Note 12). Such costs have been deferred and are being amortized on a straight-line basis over the term of the related loan and lease agreements. Long-term debt and finance lease obligations, net of current portion, short-term debt, and line of credit are recorded on the accompanying combined balance sheet net of unamortized debt issuance costs. The total of these costs amortized to interest expense was $64,275 and $19,336 for the three-month period ended June 30, 2024 and 2023, respectively, and $89,888 and $38,673 for the six-month period ended June 30, 2024 and 2023, respectively.

Compensated absences – Employees of the Company are entitled to paid vacations, sick days and other time off depending on job classification, length of service and other factors. The Company does not accumulate vacation or sick time, the estimate for the amount of compensation for future absences was immaterial and, accordingly, no liability has been recorded in the accompanying combined financial statements. The Company’s policy is to recognize the costs of compensated absences when paid to the individual employees.

Subsequent events – Management has evaluated subsequent events through September 11, 2024, the date these combined financial statements were available to be issued. See Note 17.

Reclassifications – Certain reclassifications have been made to the December 31, 2023 balance sheet in order for it to be in conformity with the current year presentation.

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(3)

Restatement of Previously Issued Interim Financial Information

Subsequent to the issuance of the interim financial information as of June 30, 2024 and for the three-month and six-month periods ended June 30, 2024 and 2023, management identified errors in the calculation of interest expense. These errors were due to (1) failing to accrue interest on long-term debt in accordance with its terms, and (2) incorrectly recording payments on short-term notes payable by understating the interest portion of those payments.

As a result of these errors, interest expense was understated by $769,424 for the three-month period ended June 30, 2024, and by $1,578,500 for the six-month period ended June 30, 2024. The effects of correcting these errors on the interim financial information are summarized below.

Effect on balance sheet as of June 30, 2024:

	As Previously Reported		Adjustment			As Restated
Short-term notes payable		5,910,834		907,726			6,818,560
Current portion of long-term debt		14,108,458		670,774			14,779,232
Members’ equity		18,801,376		(1,578,500	)		17,222,876

Effect on statement of operations for the three-month period ended June 30, 2024:

	As Previously Reported			Adjustment			As Restated
Interest expense		(1,183,198	)		(769,424	)		(1,952,622	)
Net loss		(260,623	)		(769,424	)		(1,030,047	)

Effect on statement of operations for the six-month period ended June 30, 2024:

	As Previously Reported			Adjustment			As Restated
Interest expense		(2,247,011	)		(1,578,500	)		(3,825,511	)
Net loss		(1,011,842	)		(1,578,500	)		(2,590,342	)

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(4)

Major Customers and Concentration of Credit Risk

The Company had certain customers whose revenue individually represented 10% or more of the Company’s total revenue and whose accounts receivable balances individually represented 10% or more of the Company’s total accounts receivable, as follows:

The Company had two (2) major customers that accounted for approximately 42% and 30% of revenue for the three-month period ended June 30, 2024 and 2023, respectively, and 36% and 31% of revenue for the six-month period ended June 30, 2024 and 2023, respectively. These customers accounted for approximately 42% and 24% of the balance of accounts receivable as of June 30, 2024 and December 31, 2023, respectively.

(5)

Property and Equipment

The Company’s balance of property and equipment as of June 30, 2024 and December 31, 2023 is comprised of the following:

	June 30, 2024			December 31, 2023
Land		2,848,857			2,848,857
Communications equipment		267,290			0
Buildings and improvements		1,700,201			1,700,201
Trucks and trailers		32,000,898			30,603,602
Right-of-use asset - finance leases		14,718,960			14,718,960
Pipeline and tanks		41,107,022			41,107,022
Sub-total		92,643,228			90,978,642
Less: accumulated depreciation		(30,904,774	)		(25,083,450	)
Property and equipment, net		61,738,454			65,895,192

Depreciation expense related to property and equipment was $2,950,658 and $1,740,483 for the three-month period ended June 30, 2024 and 2023, respectively, and $5,833,126 and $3,259,235 for the six-month period ended June 30, 2024 and 2023, respectively.

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(6)

Related-Party Transactions

On January 1, 2023, Endeavor entered into a take or pay agreement with White Claw Crude, LLC (“WCC”), a related party controlled by James Ballengee, manager of the Company, in which the Company is to provide hauling services to WCC for their crude oil and gas products. The agreement states that if WCC does not cause 100,000 barrels per day to be hauled (subsequently amended to 75,000 barrels effective January 1, 2024) during the period January 1, 2023 through December 31, 2033 (subsequently amended to December 31, 2034), the minimum volume commitment (“MVC”), then WCC must pay the Company a deficiency fee equal to the shortage amount, in barrels, multiplied by 25% of the average rate of all hauls for the related calendar year. The Company earned $422,546 and $2,701,148 in deficiency fees during the three-month period ended June 30, 2024 and 2023, respectively, and $640,927 and $4,964,474 during the six-month period ended June 30, 2024 and 2023, respectively, which are included in sales in the accompanying combined statements of operations.

On January 1, 2023, CP entered into a take or pay agreement with WCC in which WCC is to process and transfer 200,000 barrels per month, the MVC, of its crude oil and gas products through the Company’s processing and transfer terminals. The agreement states WCC must pay the Company an amount equal to the greater of the actual volume of product transferred multiplied by the applicable rate, or, the MVC multiplied by the applicable rate. The applicable rates are $1.00 per barrel up to the MVC and $.50 for each barrel in excess of the MVC. The Company earned $600,000 and $600,000 from the agreement during the three-month period ended June 30, 2024 and 2023, respectively, of which $169,066 and $204,216 was derived from volume of product transferred, respectively. The Company earned $1,200,000 and $1,200,000 during the six-month period ended June 30, 2024 and 2023, respectively, of which $322,042 and $401,512 was derived from volume of product transferred, respectively. The above amounts are included in sales in the accompanying combined statements of operations. Of these fees, $447,024 and $1,642,458 were included in trade accounts receivable on the accompanying combined balance sheets as of June 30, 2024 and December 31, 2023, respectively.

On January 1, 2024, Meridian and ET allowed Horizon Truck and Trailer, LLC (“HTT”), a related party with common management, to occupy five (5) of the Company’s locations under operating leases on a month-to-month basis and reimburse the Company for the related monthly lease payments. The monthly payments on the leases range from $5,750 to $138,395 and have terms ranging from 24 to 36 months. The Company recorded lease payments due from HTT in the amount of $577,800 and $978,550 for the three and six-month periods ended June 30, 2024, respectively, which are included in reimbursed expenses on the accompanying combined statement of operations and trade accounts receivable on the accompanying combined balance sheet.

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(6)

Related-Party Transactions (continued)

In addition, the Company agreed to pay for various expenses on behalf of HTT which totaled $580,477 and $1,228,786 for the three and six-month periods ended June 30, 2024, respectively, and are included in reimbursed expenses on the accompanying combined statement of operations and trade accounts receivable on the accompanying combined balance sheet.

The Company used HTT’s services during the three and six-month periods ended June 30, 2024 to perform capital repairs, upgrades, and maintenance to prepare and maintain their fleet of trucks and trailers for operations. The costs totaled $1,698,037 for the six-month period ended June 30, 2024 and are included in accounts payable on the accompanying combined balance sheet, of which $1,677,811 were recognized as capital improvements on the Company’s trucks and trailers.

During the year ended December 31, 2023, the Company received and provided operating loans from and to various related parties. The loans are short term in nature with no stated repayment terms. As of June 30, 2024 and December 31, 2023, the Company was owed a total of $1,684,310 and $245,368 from its related parties, respectively, and owed a total of $1,784,994 and $1,653,755, respectively, to its related parties.

(7)

Note Payable – PPP Loan

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(8)

Long-Term Debt

Long-Term debt as of June 30, 2024 and December 31, 2023 consisted of the following:

	June 30, 2024		December 31, 2023
Note payable to Ford Credit dated November 1, 2019, payable in 54 monthly installments of $860 at 8.6% interest. Note is collateralized by a 2019 Ford Explorer.		0		3,008
Note payable to B1Bank dated February 12, 2020, payable in 48 monthly installments of $7,278 at 5.5% interest. Note is collateralized by 6 Dragon tractor trailers.		0		13,985
Main Street Lending Priority Loan Agreement with Business First Bank dated November 12, 2020. Interest accrues at the LIBOR rate plus 3% per annum; maturing on November 12, 2025; secured by substantially all assets of the Company.		10,760,805		10,760,805
Note payable to the U.S. Small Business Administration dated June 16, 2020, payable in 348 monthly installments of $731 beginning June 16, 2021 at 3.75% interest. Note is collateralized by substantially all assets of the Company.		10,000		160,000
Note payable to Ally Financial dated July 30, 2021, payable in 60 monthly installments of $1,645 at 6.24% interest. Note is collateralized by a 2020 Dodge Challenger.		41,929		50,393
Note payable to TD Ameritrade dated January 4, 2021, payable in 72 monthly installments of $991 at 6.89% interest. Note is collateralized by a 2019 Ford Expedition.		27,956		32,838
Note payable to TD Ameritrade dated December 9, 2021, payable in 72 monthly installments of $1,434 at 4.94% interest. Note is collateralized by a 2018 Jeep Grand Cherokee.		54,056		62,378
Note payable to Ally Financial dated December 24, 2021, payable in 60 monthly installments of $1,532 at 9.79% interest. Note is collateralized by a 2018 Ford Expedition.		39,692		46,684
Note payable to Ford Credit dated March 31, 2023, payable in 60 monthly installments of $1,046 at 0.90% interest. Note is collateralized by a 2018 Ford F-150.		53,240		57,272
Note payable to Ford Credit dated March 31, 2023, payable in 60 monthly installments of $1,093 at 0.90% interest. Note is collateralized by a 2022 Ford F-150.		56,392		60,249

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(8)

Long-Term Debt (continued)

	June 30, 2024			December, 31 2023
Notes payable to Small Business Administration dated April 10, 2020 and February 4, 2021, payable in 60 monthly installments of $30,374 and $35,024, respectively, at 1.00% interest. Notes are collateralized by the Company’s real and personal property.		2,302,305			2,482,360
Note payable to Ford Credit dated July 17, 2023, payable in 48 monthly installments of $1,622 at 9.99% interest. Note is collateralized by a 2021 Chevrolet Tahoe.		51,829			58,787
Note payable to TD Ameritrade dated January 6, 2023, payable in 72 monthly installments of $1,194 at 8.99% interest. Note is collateralized by a 2021 Ford F-250.		52,995			58,351
Note payable to Ally Financial dated February 27, 2023, payable in 72 monthly installments of $1,163 at 10.89% interest. Note is collateralized by a 2022 Ford F-150.		51,847			55,849
Note payable to Ford Credit dated July 7, 2023, payable in 48 monthly installments of $1,195 at 2.9% interest. Note is collateralized by a 2023 Ford F-150.		49,824			54,935
Note payable to Ford Credit dated September 8, 2023, payable in 48 monthly installments of $2,370 at 10.79% interest. Note is collateralized by a 2022 Dodge Charger.		77,130			86,854
Note payable to Pilot OFS Holdings, LLC dated December 31, 2023, payable in one lump sum payment of $12,500,000 plus all interest accrued at a rate of 10.5% on June 30, 2024. Note is collateralized by 405 various tractors, trucks, and trailers along with all related tools and supplies.		13,170,774			12,500,000
Note payable to Pilot OFS Holdings, LLC dated December 1, 2023, payable in 18 monthly installments of $90,431 at 10.5% interest. Note is collateralized by 28 various tanker trailers.		1,026,591			1,500,000
Total long-term debt		27,827,365			28,044,748
Less: unamortized debt issuance costs		(69,887	)		(96,095	)
Long-term debt, less unamortized debt issuance costs		27,757,478			27,948,653
Less: current portion		(14,779,232	)		(14,843,727	)
Total long-term debt, less current portion		12,978,246			13,104,926

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(8)

Long-Term Debt (continued)

Following are the maturities of long-term debt:

	2024			14,779,232
	2025			10,727,026
	2026			2,162,737
	2027			115,025
	2028			38,420
	2029 & thereafter			4,925
	Totals			27,827,365

(9)

Finance Lease Obligations

On December 28, 2021, the Company entered into six finance leases with Maxus Capital Group, LLC (Maxus) for 57 trucks and tanker trailers.

On April 21, 2022, the Company entered into two additional finance leases with Maxus, the first being for thirty (30) trucks and tanker trailers and the second being for two (2) tanker trailers.

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(9)

Finance Lease Obligations (continued)

The Company has pledged 100% of its interests in the related pipeline assets as collateral for the lease obligations.

The Company is required to make one-time security deposit payments of $56,803 and $20,955 for the first and second lease, respectively, to be used in the event of a default by the Company. In addition, the Company is required to make minimum cash reserve payments of at least $18,934 and $6,985 for the first and second lease, respectively, each month in addition to the base lease payments until Maxus has received $681,640 and $251,458 for the first and second lease, respectively. The cash reserve payments are to be used in the event of default by the Company. All security deposit amounts as well as cash reserve amounts will be fully refunded to the Company at the end of the lease term. As of June 30, 2024 and December 31, 2023, the balance of cash reserve payments made under these lease obligations was $466,549 and $311,033, respectively. The Company incurred $124,650 of lease costs from the preceding transaction that are being amortized over the 5-year term of the leases.

The terms of the lease agreement, including the Company’s option to purchase the pipeline assets from Maxus at the end of the lease term, preclude the Company from using sale and leaseback accounting treatment in accordance with FASB ASC-842-40. As such, the transaction is being accounted for as a financing arrangement, whereby the Company does not record a sale or derecognize the pipeline assets. The Company continues to record depreciation expense on the pipeline assets and has recorded a financial liability due to Maxus (included in finance lease obligations in the accompanying combined balance sheet).

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(9)

Finance Lease Obligations (continued)

On March 22, 2023, the Company entered into three (3) additional finance leases with Maxus for 90 trucks and tanker trailers.

The terms of the lease agreements, including the Company’s option to purchase the leased assets from Maxus at the end of the lease terms, classify the leases as finance leases in accordance with FASB ASC 842. As such, the Company has recorded lease obligations equal to the present value of the future cash payments using the interest rate implicit in the leases of 11.56% as well as lease assets equal to the present value of the future cash payments using an interest rate of 11.56%.

On November 20, 2023, the Company entered into five (5) additional finance leases with Maxus for one hundred and five (105) trucks and tanker trailers.

The terms of the lease agreements, including the Company’s option to purchase the leased assets from Maxus at the end of the lease terms, classify the leases as finance leases in accordance with FASB ASC 842. As such, the Company has recorded lease obligations equal to the present value of the future cash payments using the implicit borrowing rate of similar leases with Maxus for similar assets and terms of 11.56% as well as lease assets equal to the present value of the future cash payments using an interest rate of 11.56% plus lease costs of $302,750 and prepaid lease payments of $235,054.

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(9)

Finance Lease Obligations (continued)

Future minimum lease payments for each of the next four years under the Maxus lease obligation and a reconciliation of undiscounted cash flows to the balance of the lease obligation as of June 30, 2024 on the accompanying combined balance sheet are as follows:

2024	3,195,725
2025	4,911,822
2026	4,462,499
2027	858,530
Total minimum lease payments	13,428,576
Less: amount representing interest	(3,273,238	)
Present value of net minimum payments	10,155,338
Add: carrying value of lease obligation at end of lease term	2,832,813
Total lease obligation	12,988,151
Less: unamortized financing fees	(87,255	)
Total lease obligation, less unamortized financing fees	12,900,896
Less: current portion	(3,195,725	)
Total lease obligation, less current portion	9,705,171

(10)

Operating Lease Liabilities

As part of the business acquisition of ET, dated December 22, 2023, Meridian assumed three (3) leases with Pilot Water Solutions SWD, LLC for the use of trucking yards, shops, and a housing development to be used in trucking operations. The terms of the leases range from twenty-four (24) to thirty-six (36) months with monthly installments ranging from $5,750 to $138,395.

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(10)

Operating Lease Liabilities (continued)

The terms of the lease agreements classify the leases as operating leases in accordance with FASB ASC 842. As such, the Company has recorded a lease obligation as well as a lease asset equal to the present value of the future cash payments. In determining the discount rate for the calculation of future cash payments, the Company used the risk-free discount rate of 4.336% and 4.042%, which are the rates of a U.S. government bond as of the commencement dates of the leases and for a term comparable to the respective lease terms.

Under the provisions of ASC 842, the Company has elected the short-term lease expedient. A short-term lease is a lease that, as of the commencement date, has a lease term of 12 months or less and does not include an option to purchase the underlying asset that the lessee is reasonably certain to exercise. For such leases, the Company will not apply the recognition requirements of Topic 842 and instead will recognize the lease payments as lease cost on a straight-line basis over the lease term. Lease costs related to short-term leases were $671,236 and $54,407 for the three- month period ended June 30, 2024 and 2023, respectively, and $1,503,118 and $101,847 for the six-month period ended June 30, 2024 and 2023, respectively, and are included in lease expense on the accompanying combined statements of operations.

Future minimum lease payments for each of the next three years under the operating lease obligations and a reconciliation of the undiscounted cash flows to the balance of the operating lease obligation as of June 30, 2024 on the accompanying combined balance sheet are as follows:

2024	1,240,870
2025	2,431,740
2026	978,975
Total minimum lease payments	4,651,585
Less: amount representing interest	(169,270	)
Total lease obligation	4,482,315
Less: current portion	(1,240,870	)
Total lease obligation, less current portion	3,241,445

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(11)

Business Combination

On January 1, 2024, upon inspection of the equipment shops that the Company assumed the operating leases for during the acquisition, management discovered parts inventory housed in the shops with a value of $556,947 that was not included in the original list of net identifiable assets during the sale and was not taken into consideration during the purchase price allocation. After discovery, management adjusted beginning inventory to reflect the additional inventory and offset the addition by reducing the amount of the purchase price allocated to property and equipment.

The following is a recalculated list of net identifiable assets at estimated fair value assumed as of the date of the acquisition:

	Total cash consideration			12,500,000
	Purchase price allocation:
	Accounts receivable			1,500,000
	Inventory			603,731
	Property and equipment, net			10,396,269
	Net assets acquired			12,500,000

As disclosed in Note 1, effective January 1, 2024, the Company transferred 100% of its membership interests in ET to its parent company, Jorgan.

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(12)

Line of Credit

On January 6, 2023, the Company entered into an accounts receivable factoring agreement with a financial institution that allows the Company to sell their currently outstanding accounts receivable for cash up to a maximum principal balance of $7,500,000 (hereinafter referred to as line of credit). The Company is charged a fixed service charge by the institution in the amount of 1% of all receivables purchased in addition to a variable service charge of 1.75% of the outstanding amount of a purchased receivable per day up to 120 days or until the face amount of the purchased receivable is collected by the financial institution. The agreement states that if a receivable becomes 120 days or more outstanding, then the institution may require the Company to repurchase the account at face value. To facilitate the potential buyback, the agreement states that the Company must keep a reserve account with the institution in an amount equal to 10% of all purchased accounts. The outstanding principal balance of the line of credit was $7,330,705 and $5,575,005 as of June 30, 2024 and December 31, 2023, respectively. The amount of the reserve account was $1,923,434 and $1,262,525 as of June 30, 2024 and December 31, 2023, respectively, and is included in restricted cash in the accompanying combined balance sheets.

On May 9, 2024, the Company entered into an accounts receivable factoring agreement with a financial institution that allows the Company to sell their currently outstanding accounts receivable for cash up to a maximum principal balance of $7,000,000 (hereinafter referred to as line of credit). The Company is charged a fixed service charge by the institution in the amount of 1% of all receivables purchased in addition to a variable service charge of 2.5% of the face amount of a purchased receivable per day up to 120 days or until the face amount of the purchased receivable is collected by the financial institution. The agreement states that if a receivable becomes 120 days or more outstanding, then the institution may require the Company to repurchase the account at face value. To facilitate the potential buyback, the agreement states that the Company must keep a reserve account with the institution in an amount equal to 10% of all purchased accounts. The outstanding principal balance of the line of credit, net of unamortized issuance costs, was $6,079,093 and $0 as of June 30, 2024 and December 31, 2023, respectively. The amount of the reserve account was $706,730 and $0 as of June 30, 2024 and December 31, 2023, respectively, and is included in restricted cash in the accompanying combined balance sheets.

(13)

Interest Rate Swap

During February 2022 the Company entered into an interest rate swap contract associated with its Main Street Lending Priority Loan (See Note 8). The Company used the interest rate swap to manage risks related to interest rate movements and effectively converted this variable rate debt into a fixed-rate borrowing at 3.92% on a notional amount of $10,000,000. The swap contract settled monthly. On May 11, 2023, the Company terminated its swap agreement with Citibank N.A. The Company recorded a net gain of $686,096 included in other income in the accompanying combined statements of income.

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(14)

Short-Term Notes Payable

On November 20, 2023, the Company entered into a short-term financing agreement with Maxus for a principal amount of $1,500,000. The Company will make interest only payments monthly until the maturity of the note, upon which all outstanding principal and accrued interest is due. The note was originally scheduled to mature six months from the date of borrowing and was subsequently extended an additional six months to a maturity date of November 20, 2024. The outstanding principal balance was $1,432,049 and $1,500,000 as of June 30, 2024 and December 31, 2023, respectively. The note is collateralized by twenty-eight (28) trucks and tanker trailers.

On February 13, 2024, the Company entered into a short-term financing agreement with Maxus for a principal amount of $3,000,000. The Company will make interest only payments monthly until the maturity of the note, September 1, 2024, upon which all outstanding principal and accrued interest is due. The note is collateralized by a fleet of trucks and trailers. The outstanding principal balance, net of unamortized debt issuance costs, was $2,818,785 and $0 as of June 30, 2024 and December 31, 2023, respectively. On August 15, 2024, the Company received a three-month extension until November 30, 2024.

On June 20, 2024, the Company entered into a short-term financing agreement with Agile Lending, LLC for a principal amount of $1,312,500. The Company is required to make weekly installments of $67,500 at 145.93% interest until maturity on January 3, 2025. The outstanding principal balance was $1,250,000 and $0 as of June 30, 2024 and December 31, 2023, respectively.

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(15)

Adoption of New Accounting Standard

The Company adopted the standard effective January 1, 2023. The impact of the adoption was not considered material to the combined financial statements.

(16)

Intent to Sell Membership Interests

(17)

Default on Promissory Notes

On August 23, 2024, the Company received two (2) amended demand letters from the counsel for Pilot Travel Centers, LLC and Pilot OFS Holdings, LLC (collectively referred to as “Pilot”) demanding that Meridian pay all outstanding principal and accrued interest on certain promissory notes, assigned accounts receivable, and rental payments.

The first amended demand letter refers to Meridian’s default under its $1,500,000 note payable, dated December 1, 2023. Eighteen (18) monthly installments in the amount of $90,431 were being made under this note. Meridian made these monthly payments through June 2024 and failed to make payments for July and August 2024, triggering a default and immediate payment of the outstanding principal and accrued interest under this note in the amount of $1,034,873.

The second amended demand letter refers to Meridian’s default under its $12,500,000 note payable, dated December 31, 2023. The principal amount of this note plus accrued interest was due in full on June 30, 2024. Meridian failed to make payment. In addition, the demand letter states that Meridian failed to make a payment of $3,410,574 related to assigned accounts receivable as well as $19,250 in rental payments due as a result of the purchase of ET.

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(17)

Default on Promissory Notes (continued)

Both letters demand that full payment be made by Meridian on the defaulted obligations no later than August 30, 2024. As of September 11, 2024, the date the combined financial statements were available to be issued, Meridian has made payments of $500,000 towards these obligations.

Additionally, as shown in the accompanying financial statements, the Company’s current liabilities exceed its current assets by $25,688,063 as of June 30, 2024. These factors, along with the uncertain conditions Meridian faces regarding its notes payable with Pilot, create substantial doubt about the Company’s ability to continue as a going concern. Management of the Company has evaluated these conditions and is currently working with outside creditors to obtain additional financing to repay its obligations to Pilot. While the Company works to obtain additional financing, they have also requested extensions on the payment of all outstanding obligations in default through December 31, 2024. The ability of the Company to continue as a going concern and meet its obligations as they become due is dependent on the acceptance of the extension by Pilot and the Company’s ability to obtain additional financing. The combined financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

See independent auditors’ review report

Exhibit 99.4

Silver Fuels Processing, LLC

Financial Statements

as of June 30, 2024 and December 31, 2023

and for the three-month and six-month periods

ended June 30, 2024 and 2023

Silver Fuels Processing, LLC

Notes to the Financial Statements

Independent Auditors’ Review Report		1-2

Balance Sheets as of June 30, 2024 (Unaudited) and December 31, 2023		3

Statements of Income for the three-month and six-month periods ended June 30, 2024 and 2023 (Unaudited)		4

Statements of Members’ Equity for the three-month and six-month periods ended June 30, 2024 and 2023 (Unaudited)		5

Statements of Cash Flows for the six-month periods ended June 30, 2024 and 2023 (Unaudited)		6

Notes to the Financial Statements (Unaudited)		7-11

INDEPENDENT AUDITORS’ REVIEW REPORT

Management

Silver Fuels Processing, LLC

Dallas, Texas

Results of Review of Interim Financial Information

We have reviewed the accompanying financial statements of Silver Fuels Processing, LLC, which comprise the balance sheet as of June 30, 2024 and the related statements of income and members’ equity for the three-month and six-month periods ended June 30, 2024 and 2023, and statements of cash flows for the six-month periods ended June 30, 2024 and 2023, and the related notes to the financial statements (collectively referred to as the “interim financial information”).

Basis for Review Results

We conducted our reviews in accordance with auditing standards generally accepted in the United States of America (GAAS) applicable to reviews of interim financial information. A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. A review of interim financial information is substantially less in scope than an audit in accordance with GAAS, the objective of which is the expression of an opinion regarding the financial information as a whole, and accordingly, we do not express such an opinion. We are required to be independent of Silver Fuels Processing, LLC and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements related to our reviews. We believe that the results of the review procedures provide a reasonable basis for our conclusion.

Related-Party Transactions

As discussed in Notes 4 and 5 to the accompanying financial statements, all revenues are derived from an entity in which the Company’s manager also controls. Our conclusion is not modified with respect to that matter.

Responsibilities of Management for the Interim Financial Information

Report on Balance Sheet as of December 31, 2023

We have previously audited, in accordance with GAAS, the balance sheet as of December 31, 2023, and the related statements of income, members’ equity, and cash flows for the year then ended (not presented herein); and we expressed an unmodified opinion on those audited financial statements in our report dated June 6, 2024. Our audit report included an emphasis-of-matter section that indicated all revenues were derived from an entity in which the Company’s manager also controls. In our opinion, the accompanying balance sheet of Silver Fuels Processing, LLC as of December 31, 2023, is consistent, in all material respects, with the audited financial statements from which it has been derived.

Shreveport, Louisiana

September 6, 2024

Silver Fuels Processing, LLC

Balance Sheets

as of June 30, 2024 (Unaudited) and December 31, 2023

	June 30, 2024		December 31, 2023
	(Unaudited)
Assets
Current assets
Cash and cash equivalents		4,673		5,990
Accounts receivable, Notes 2 and 4		138,859		0
Prepaid expense		169,627		63,309
Due from related parties, Note 4		68,196		64,037
Other current assets		8,312		0
Total current assets		389,667		133,336

Property and equipment, net, Notes 2 and 3		986,566		1,157,113

Other Assets
Security deposits		12,992		2,992
Total other assets		12,992		2,992

Total assets		1,389,225		1,293,441

Liabilities and members’ equity
Current liabilities
Accounts payable		1,093		325,807
Due to related parties, Note 4		318,468		0
Total current liabilities		319,561		325,807

Members’ equity		1,069,664		967,634

Total liabilities and members’ equity		1,389,225		1,293,441

See independent auditors’ review report and accompanying notes to the financial statements.

Silver Fuels Processing, LLC

Statements of Income

for the three-month and six-month periods ended June 30, 2024 and 2023 (Unaudited)

	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Revenues
Sales		189,750		150,000		379,500		300,000
Reimbursed expenses - related party		11,478		16,269		58,360		89,561
Total income		201,228		166,269		437,860		389,561

Operating expenses
Bank charges		190		0		340		0
Depreciation		83,886		60,157		164,118		119,808
Insurance		47,238		26,475		80,634		35,300
Miscellaneous		556		833		4,882		7,787
Office supplies		0		157		83		196
Payroll		18,559		18,638		37,413		37,684
Professional fees		9,950		8,773		26,667		24,273
Repairs and maintenance		518		3,636		24,089		46,085
Travel		1,747		3,681		6,094		6,812
Utilities		6,023		8,312		15,965		15,520
Rent		16,000		16,000		32,025		29,500
Contract labor		0		0		5,885		0
Station		4,853		0		9,635		2,219
Total operating expenses		189,520		146,662		407,830		325,184

Income from operations		11,708		19,607		30,030		64,377

Other income
Other income		0		0		0		33,750
Total other income		0		0		0		33,750

Net income		11,708		19,607		30,030		98,127

See independent auditors’ review report and accompanying notes to the financial statements.

Silver Fuels Processing, LLC

Statements of Members’ Equity

for the three-month and six-month periods ended June 30, 2024 and 2023 (Unaudited)

Balance, March 31, 2024 (Unaudited)	997,956

Net income	11,708
Members’ contributions	60,000
Members’ distributions	0

Balance, June 30, 2024 (Unaudited)	1,069,664

Balance, December 31, 2023	967,634

Net income	30,030
Members’ contributions	72,000
Members’ distributions	0

Balance, June 30, 2024 (Unaudited)	1,069,664

Balance, March 31, 2023 (Unaudited)	884,639

Net income	19,607
Members’ contributions	77,500
Members’ distributions	(374,320	)

Balance, June 30, 2023 (Unaudited)	607,426

Balance, December 31, 2022	792,619

Net income	98,127
Members’ contributions	121,000
Members’ distributions	(404,320	)

Balance, June 30, 2023 (Unaudited)	607,426

See independent auditors’ review report and accompanying notes to the financial statements.

Silver Fuels Processing, LLC

Statements of Cash Flows

for the six-month periods ended June 30, 2024 and 2023 (Unaudited)

	Six Months Ended June 30,
	2024			2023
Cash flows from operating activities
Net income		30,030			98,127
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation		164,118			119,808
(Increase) decrease in:
Accounts receivables		(138,859	)		(400,249	)
Due from related parties		(4,159	)		0
Prepaid expenses		(106,318	)		836
Security deposit		(10,000	)		0
Other current assets		(8,312	)		0
Increase (decrease) in:
Accounts payable		(211,833	)		67,243
Due to related party		318,468			0
Net cash provided by (used in) operating activities		33,135			(114,235	)

Cash flows from investing activities
Purchases of property and equipment		(106,452	)		(21,250	)
Net cash used in investing activities		(106,452	)		(21,250	)

Cash flows from financing activities
Contributions from members		72,000			121,000
Distributions to members		0			(30,000	)
Net cash provided by financing activities		72,000			91,000

Net change in cash and cash equivalents		(1,317	)		(44,485	)

Beginning cash and cash equivalents		5,990			47,015

Ending cash and cash equivalents		4,673			2,530

Supplementary non-cash investing and financing activities:
Assignment of related-party receivable to parent through distributions		0			374,320
Transfer of property improvements to related party		112,880			0

See independent auditors’ review report and accompanying notes to the financial statements.

Silver Fuels Processing, LLC

Notes to the Financial Statements

(1)

Nature of Business

(2)

Summary of Significant Accounting Policies

Basis of accounting - The financial statements of the Company have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.

Basis of presentation and use of estimates - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Cash and cash equivalents - For the purpose of reporting cash flows, cash and cash equivalents include all cash on hand and cash on deposit with maturities of less than three months.

Accounts receivable and allowance for credit losses – All of the Company’s accounts receivable are from one customer, White Claw Crude, LLC (“WCC”), a related party (Note 4). Accounts receivable are generated from fees charged to WCC for the right to use the Company’s crude oil transfer stations to transport their crude oil along various oil pipelines and monthly reimbursable operating expenses. At each balance sheet date, the Company evaluates the need for an allowance for credit loss account and, if deemed necessary, recognizes an expected allowance for credit losses. In addition, also at each reporting date, this estimate is updated to reflect any changes in credit risk since the receivable was initially recorded. This estimate is calculated on a pooled basis where similar risk characteristics exist.

Due to all accounts receivable being due from a related party, and considered 100% collectible, management has not calculated an allowance for credit losses as of June 30, 2024 and December 31, 2023.

Property and equipment – Property and equipment is stated at cost. Depreciation is computed by the straight-line method over the assets’ estimated useful lives of 7 years.

See independent auditors’ review report.

Silver Fuels Processing, LLC

Notes to the Financial Statements

(2)

Summary of Significant Accounting Policies (continued)

Revenue recognition – All of the Company’s revenues are derived from fees charged for the use of their crude oil transfer stations to transport oil along various pipelines and from reimbursement of certain operating expenses related to the facilitation of this process. The Company has one performance obligation in the form of allowing its customer to utilize their transfer stations. The Company has determined that the customer has obtained the promised service when the customer successfully utilizes the Company’s transfer station to transport oil, as such, the Company recognizes revenue at the point in time that the transfer stations are utilized by the customer. Reimbursed expense income is recognized as the related expenses are incurred. There is no significant financing component in transaction price, as the Company’s customer generally pays within the contractual payment terms of 30 to 60 days.

Income taxes - The Company is a limited liability company that is taxed as a partnership for federal and state income tax purposes. As such, the Company does not pay income taxes, as any income or loss and credits are included in the tax returns of the individual partners. Accordingly, no provision has been made for income taxes in the financial statements.

Compensated absences – Employees of the Company are entitled to paid vacations, sick days and other time off depending on job classification, length of service and other factors. The Company does not accumulate vacation or sick time, the estimate for the amount of compensation for future absences was immaterial and, accordingly, no liability has been recorded in the accompanying financial statements. The Company’s policy is to recognize the costs of compensated absences when paid to the individual employees.

Subsequent events – Management of the Company has evaluated subsequent events, for recognition and disclosure, through September 6, 2024, the date the financial statements were available to be issued.

See independent auditors’ review report.

Silver Fuels Processing, LLC

Notes to the Financial Statements

(3)

Property and Equipment

The following is a summary of property and equipment as of June 30, 2024 and December 31, 2023:

	June 30, 2024		December 31, 2023
Basa station		1,130,787		1,137,216
Midland station		87,581		87,581
Posse Monroe station		689,557		689,557
Wasson station		376,711		376,711
Steel Tanks		64,175		64,175
Sub-total	$	2,348,811	$	2,355,240
Less: accumulated depreciation		1,362,245		1,198,127
Totals	$	986,566	$	1,157,113

Depreciation expense related to property and equipment was $83,886 and $60,157 for the three- month periods ended June 30, 2024 and 2023, respectively, and was $164,118 and $119,808 for the six-month periods ended June 30, 2024 and 2023, respectively.

(4)

Related-Party Transactions

As disclosed in Notes 2 and 5, the Company’s only Customer is WCC, a related party owned and managed by Jorgan Development, a Louisiana limited liability company, the majority owner of the Company.

Effective January 1, 2024, the Company and WCC amended the above Agreement to change the MVC to 230,000 barrels per month, the rate per barrel above and beyond the MVC to $0.15, and to extend the maturity date of the Agreement to December 31, 2034.

See independent auditors’ review report.

Silver Fuels Processing, LLC

Notes to the Financial Statements

(4)

Related-Party Transactions (continued)

Revenues from WCC during the three-month periods ended June 30, 2024 and 2023 totaled $201,228 and $166,269, respectively, which includes $189,750 and $150,000, respectively, of fee income, and $11,478 and $16,269, respectively, of reimbursed expenses. Revenues from WCC during the six-month periods ended June 30, 2024 and 2023 totaled $437,860 and $389,561, respectively, which includes $379,500 and $300,000, respectively, of fee income and $58,360 and $89,561, respectively, of reimbursed expenses.

During the periods ended June 30, 2024 and December 31, 2023, the Company provided and received operating loans to and from various related parties. The operating loans have no stated repayments terms. As of June 30, 2024 and December 31, 2023, the Company was due $68,196 and $64,037, respectively, from its related parties and owed $318,468 and $0, respectively, to its related parties.

The Company rents crude oil stations on a month-to-month basis from Endeavor Crude, LLC, a related party owned and managed by Jorgan. Total rent expense related to this lease was $16,000 and $16,000 for the three-month periods ended June 30, 2024 and 2023, respectively, and was $32,025 and $29,500 for the six-month periods ended June 30, 2024 and 2023, respectively, and is included in rent expense on the accompanying statements of income.

(5)

Major Customers and Concentration of Credit Risk

The Company’s only customer is WCC. WCC accounts for 100% of the Company’s revenue for the three and six-month periods ended June 30, 2024 and 2023.

See independent auditors’ review report.

Silver Fuels Processing, LLC

Notes to the Financial Statements

(6)

Adoption of New Accounting Standards

The Company adopted the standard effective January 1, 2023. The impact of the adoption was not considered material to the financial statements.

(7)

Intent to Sell Membership Interests

See independent auditors’ review report.

Exhibit 99.5

Endeavor Crude, LLC, Meridian Equipment

Leasing, LLC, and Equipment Transport, LLC

Combined Financial Statements

as of September 30, 2024 and December 31, 2023

and for the three-month and nine-month

periods ended September 30, 2024 and 2023

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC,

and Equipment Transport, LLC

Table of Contents

Independent Auditors’ Review Report		1-2

Combined Balance Sheets as of September 30, 2024 (Unaudited) and December 31, 2023		3

Combined Statements of Operations for the three-month and nine-month periods ended September 30, 2024 and 2023 (Unaudited)		4

Combined Statements of Members’ Equity for the three-month and nine-month periods ended September 30, 2024 and 2023 (Unaudited)		5

Combined Statements of Cash Flows for the nine-month periods ended September 30, 2024 and 2023 (Unaudited)		6

Notes to the Combined Financial Statements (Unaudited)		7-26

INDEPENDENT AUDITORS’ REVIEW REPORT

Management

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC,

and Equipment Transport, LLC

Dallas, Texas

Results of Review of Interim Financial Information

We have reviewed the accompanying combined financial statements of Endeavor Crude, LLC, Meridian Equipment, LLC, and Equipment Transport, LLC, which comprise the combined balance sheet as of September 30, 2024 and the related combined statements of operations and members’ equity for the three-month and nine-month periods ended September 30, 2024 and 2023, and statements of cash flows for the nine-month periods ended September 30, 2024 and 2023, and the related notes to the combined financial statements (collectively referred to as the “interim financial information”).

Basis for Review Results

We conducted our reviews in accordance with auditing standards generally accepted in the United States of America (GAAS) applicable to reviews of interim financial information. A review of interim financial information consists principally of applying analytical procedures and making inquires of persons responsible for financial and accounting matters. A review of interim financial information is substantially less in scope than an audit in accordance with GAAS, the objective of which is the expression of an opinion regarding the financial information as a whole, and accordingly, we do not express such an opinion. We are required to be independent of Endeavor Crude, LLC, Meridian Equipment Leasing, LLC, and Equipment Transport, LLC and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements related to our reviews. We believe that the results of the review procedures provide a reasonable basis for our conclusion.

Substantial Doubt About the Company’s Ability to Continue as a Going Concern

The accompanying financial information has been prepared assuming that the Company will continue as a going concern. As discussed in Note 16 to the interim financial information, the Company was in default under certain promissory notes. The Company has been able to obtain a short-term extension to pay under its obligations, however has been unable to obtain alternative financing, and has stated that substantial doubt exists about the Company’s ability to continue as a going concern. Management’s evaluation of the conditions and events and management’s plans regarding those matters are also described in Note 16. The accompanying interim financial information does not include any adjustments that might result from the outcome of that uncertainty.

Responsibilities of Management for the Interim Financial Information

Report on Balance Sheet as of December 31, 2023

Shreveport, Louisiana

December 10, 2024

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC,

and Equipment Transport, LLC

Combined Balance Sheets

as of September 30, 2024 (Unaudited) and December 31, 2023

	September 30, 2024		December 31,
	(Unaudited)		2023
Assets
Current assets
Cash		710,366		1,164,555
Restricted cash, Note 11		3,258,649		1,262,525
Trade accounts receivable, net of allowance for credit losses of $21,361 and $24,531 as of September 30, 2024 and December 31, 2023, respectively, Note 2		11,190,475		11,679,862
Prepaid expenses		3,232,191		546,655
Due from related party, Note 5		0		245,368
Inventory, Note 2		126,298		46,784
Total current assets		18,517,979		14,945,749

Property and equipment, net, Notes 2 and 4		58,813,934		65,895,192

Other assets
Right-of-use asset - operating, Note 9		3,899,499		5,657,160
Intangible assets, net, Note 2		738,326		2,953,305
Other assets		1,149,824		871,655
Total other assets, net		5,787,649		9,482,120

Total assets		83,119,562		90,323,061

Liabilities and members’ equity
Current liabilities
Trade payables		4,629,414		1,151,741
Accrued liabilities		6,982,795		5,562,998
Due to related party, Note 5		1,345,104		1,653,755
Line of credit, Note 11		10,835,696		5,575,005
Short-term notes payable, Note 13		7,188,638		2,345,552
Current portion of finance lease obligations, Note 8		1,693,233		6,200,710
Current portion of operating lease obligations, Note 9		617,935		2,486,740
Current portion of long-term debt, Note 7		16,288,433		14,843,727
Total current liabilities		49,581,248		39,820,228

Long-term liabilities
Finance lease obligations - less current portion, Note 8		10,121,022		8,773,041
Operating lease obligations - less current portion, Note 9		3,281,564		3,164,086
Long-term debt - less current portion, Note 7		11,743,663		13,104,926
Total long-term liabilities		25,146,249		25,042,053

Members’ equity		8,392,065		25,460,780

Total liabilities and members’ equity		83,119,562		90,323,061

See independent auditors’ review report and accompanying notes to the combined financial statements.

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC,

and Equipment Transport, LLC

Combined Statements of Operations

for the three-month and nine-month periods ended September 30, 2024 and 2023 (Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2024			2023			2024			2023
Revenues
Sales		22,680,412			13,029,539			68,568,366			39,939,971
Reimbursed expenses - related party		190,250			0			2,107,086			0
Total revenues		22,870,662			13,029,539			70,675,452			39,939,971

Operating expenses
Operating		35,626			7,500			121,123			7,500
Auto		940,703			70,971			3,363,476			543,445
Bank charges		7,091			150			450			417
Business taxes		50,838			18,230			74,718			128,501
Computer		206,443			92,658			787,026			298,461
Consulting		12,660			0			41,338			0
Contract labor		10,213,578			7,468,898			28,630,445			22,766,598
Depreciation		2,923,020			1,745,446			8,756,146			5,004,681
Employee benefits		79,845			67,274			314,491			164,497
Insurance		979,864			56,132			2,350,414			73,715
Inspections		1,217			3,443			39,608			5,789
Licenses and permits		93,980			34,904			176,455			140,099
Meals		384			143			1,298			510
Miscellaneous		82,980			18			158,191			3,601
Office		106,769			3,101			385,931			6,963
Payroll taxes		75,295			74,130			253,748			179,212
Postage		179			0			4,861			0
Professional fess		81,586			25,311			261,326			60,020
Repairs and maintenance		380,918			313,424			1,232,610			1,036,619
Regulatory		52,735			8,018			172,940			8,768
Training		0			0			0			1,086
Travel		54,114			52,584			146,441			171,167
Utilities		81,199			72,997			237,799			221,594
Tools		0			1,094			700			1,432
Supplies		50,406			28,781			136,294			74,081
Employee costs		0			18,714			19,882			78,870
Lease		393,645			112,765			2,084,884			350,450
Equipment rental		468			0			468			0
Fees		66,999			0			66,999			0
Amortization		738,326			211,650			2,796,189			830,850
Salaries and wages		4,276,817			941,389			15,877,308			2,646,747
Total operating expenses		21,987,685			11,429,725			68,493,559			34,805,673

Income from operations		882,977			1,599,814			2,181,893			5,134,298

Other income (expense)
Other income		19,876			10,866			59,351			0
Other expense		0			0			0			(48,207	)
Interest income		30,095			5,435			65,595			57,327
Credit losses		13,367			0			(106,725	)		0
Gain on hedging transactions		0			0			0			686,096
Gain (loss) on sale of assets		0			34,598			(18,630	)		8,567
Interest expense		(2,901,543	)		(775,278	)		(6,727,054	)		(2,308,515	)
Total other expense		(2,838,205	)		(724,379	)		(6,727,463	)		(1,604,732	)

Net income (loss)		(1,955,228	)		875,435			(4,545,570	)		3,529,566

See independent auditors’ review report and accompanying notes to the combined financial statements.

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC,

and Equipment Transport, LLC

Combined Statements of Members’ Equity

for the three-month and nine-month periods ended September 30, 2024 and 2023 (Unaudited)

	Accumulated Other Comprehensive Income			Members’ Equity			Total
Balance, June 30, 2024 (Unaudited)		0			17,222,876			17,222,876

Net loss		0			(1,955,228	)		(1,955,228	)
Members’ contributions		0			6,620,772			6,620,772
Members’ distributions		0			(13,496,355	)		(13,496,355	)

Balance, September 30, 2024 (Unaudited)		0			8,392,065			8,392,065

Balance, December 31, 2023		0			25,460,780			25,460,780

Net loss		0			(4,545,570	)		(4,545,570	)
Members’ contributions		0			14,070,951			14,070,951
Members’ distributions		0			(26,594,096	)		(26,594,096	)

Balance, September 30, 2024 (Unaudited)		0			8,392,065			8,392,065

Balance, June 30, 2023 (Unaudited)		0			31,324,825			31,324,825

Net income		0			875,435			875,435
Members’ contributions		0			502,307			502,307
Members’ distributions		0			(4,803,224	)		(4,803,224	)

Balance, September 30, 2023 (Unaudited)		0			27,899,343			27,899,343

Balance, December 31, 2022		28,884			30,990,723			31,019,607

Amounts reclassified from accumulated other comprehensive income		(28,884	)		28,884			0

Net income		0			3,529,566			3,529,566
Members’ contributions		0			2,494,806			2,494,806
Members’ distributions		0			(9,144,636	)		(9,144,636	)

Balance, September 30, 2023 (Unaudited)		0			27,899,343			27,899,343

See independent auditors’ review report and accompanying notes to the combined financial statements.

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC,

and Equipment Transport, LLC

Combined Statements of Cash Flows

for the nine-month periods ended September 30, 2024 and 2023 (Unaudited)

	Nine Months Ended September 30,
	2024			2023
Cash flows from operating activities
Net income (loss)		(4,545,570	)		3,529,566
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Credit losses		(106,725	)		0
Depreciation		8,756,146			5,004,681
Amortization		2,796,189			830,850
(Gain) loss on disposal of assets		18,630			(8,567	)
Gain on sale of interest rate swap agreement		0			(594,000	)
Amortization of debt issuance costs		263,090			58,010
Capitalization of interest expense		1,026,591			0
(Increase) decrease in:
Trade accounts receivable		(9,032,197	)		(7,350,240	)
Inventory		(79,514	)		493,136
Prepaid expenses		(5,982,360	)		(2,772,146	)
Due from related party		245,368			(1,497,440	)
Other current assets		0			23,982
Other assets		(278,169	)		(166,442	)
Note receivable		0			12,125
Increase (decrease) in:
Trade payables		1,101,560			(3,066,250	)
Accrued liabilities		4,775,411			2,427,146
Due to related party		(308,651	)		1,182,193
Other liabilities		0			(112,500	)
Net cash used in operating activities		(1,350,201	)		(2,005,896	)

Cash flows from investing activities
Purchases of property and equipment		(641,354	)		(112,475	)
Proceeds from sale of assets		68,700			135,144
Net cash provided by (used in) investing activities		(572,654	)		22,669

Cash flows from financing activities
Net borrowings on line of credit		5,282,650			3,778,758
Net borrowings on short-term debt		4,938,541			0
Repayments of finance lease obligations		(3,178,193	)		(1,433,609	)
Repayments on long-term debt		(982,460	)		(1,700,058	)
Debt issuance costs incurred		(322,495	)		0
Members’ contributions		3,537,568			2,432,499
Members’ distributions		(5,810,821	)		(480,412	)
Net cash provided by financing activities		3,464,790			2,597,178

Net change in cash and cash equivalents		1,541,935			613,951

Beginning cash and cash equivalents		2,427,080			2,085,508

Ending cash and cash equivalents		3,969,015			2,699,459

Supplemental disclosure of cash flow information
Cash paid for interest		6,785,971			1,581,754

Supplementary non-cash investing and financing activities
Assignment of related-party receivables to parent through distributions		14,521,164			5,332,224
Assumption of related-party payables through distributions to parent		6,262,111			3,332,000
Assumption of related-party receivables through contributions from parent		1,032,750			0
Assumption of related-party payables by parent through contributions		9,500,633			62,307

See independent auditors’ review report and accompanying notes to the combined financial statements.

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(1)

Nature of Business

Endeavor was formed in February 2019 and began operations in April 2019. Meridian was formed in April 2019 and began operations in May 2019 through the acquisition of real estate and trucking assets. Endeavor’s primary activity of generating revenue is the transportation of crude oil through its operation of a fleet of trucks and trailers primarily servicing Texas and New Mexico. Meridian is the owner of this fleet of trucks and trailers. Meridian’s primary activity of generating revenue is the leasing of these trucks and trailers to Endeavor.

In December 2023, Meridian acquired 100% of the membership interests in ET through a business combination, see Note 10. In January 2024, Meridian transferred 100% of its membership interests in ET to its parent, Jorgan Development, LLC. ET owns and operates a fleet of trucks and trailers used in the transportation of crude oil and gas.

(2)

Summary of Significant Accounting Policies

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(2)

Summary of Significant Accounting Policies (continued)

Cash and cash equivalents – Cash and cash equivalents include all cash on hand and cash on deposit with maturities of less than three months.

Trade accounts receivable and allowance for credit losses – The Company’s trade accounts receivable are primarily derived from trucking transportation customers. At each balance sheet date, the Company recognizes an expected allowance for credit losses. Also at each reporting date, this estimate is updated to reflect any changes in credit risk since the receivable was initially recorded. This estimate is calculated on a pooled basis where similar risk characteristics exist.

	Communications equipment			3 years
	Autos, trucks and trailers			5-7 years
	Buildings and improvements			15 years
	Pipeline and tanks			20 years

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(2)

Summary of Significant Accounting Policies (continued)

Total amortization expense relating to the trucking contract was $0 and $211,650 for the three- month period ended September 30, 2024 and 2023, respectively, and $0 and $830,850 for the nine-month period ended September 30, 2024 and 2023, respectively.

Total amortization expense relating to the transaction costs was $738,326 and $0 for the three- month period ended September 30, 2024 and 2023, respectively, and $2,796,189 and $0 for the nine-month period ended September 30, 2024 and 2023, respectively.

Level 1 – Observable inputs, such as quoted prices in active markets for identical assets or liabilities.

Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(2)

Summary of Significant Accounting Policies (continued)

Inventory – Inventory is stated at the lower of cost or net realizable value, with cost being determined under the first-in, first-out method.

Revenue recognition – Substantially all revenue the Company earns is related to trucking fees charged to customers for gathering and transporting crude oil and gas products.

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(2)

Summary of Significant Accounting Policies (continued)

Debt issuance costs – Debt issuance costs represent costs incurred in relation to the Main Street Loan Credit Facility (see Note 7), Maxus lease obligations (see Note 8 and 13), and the Business First Bank line of credit (see Note 11). Such costs have been deferred and are being amortized on a straight-line basis over the term of the related loan and lease agreements. Long-term debt and finance lease obligations, net of current portion, short-term debt, and line of credit are recorded on the accompanying combined balance sheet net of unamortized debt issuance costs. The total of these costs amortized to interest expense was $148,879 and $19,337 for the three-month period ended September 30, 2024 and 2023, respectively, and $263,090 and $58,010 for the nine-month period ended September 30, 2024 and 2023, respectively.

Subsequent events – Management has evaluated subsequent events through December 10, 2024, the date these combined financial statements were available to be issued. See Note 16.

Reclassifications – Certain reclassifications have been made to the December 31, 2023 balance sheet in order for it to be in conformity with the current year presentation.

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(3)

Major Customers and Concentration of Credit Risk

The Company had two (2) major customers that accounted for approximately 42% and 44% of revenue for the three-month period ended September 30, 2024 and 2023, respectively, and 38% and 35% of revenue for the nine-month period ended September 30, 2024 and 2023, respectively. These customers accounted for approximately 36% and 24% of the balance of accounts receivable as of September 30, 2024 and December 31, 2023, respectively.

(4)

Property and Equipment

The Company’s balance of property and equipment as of September 30, 2024 and December 31, 2023 is comprised of the following:

	September 30, 2024			December 31, 2023
Land		2,848,857			2,848,857
Communications equipment		265,790			0
Buildings and improvements		1,700,201			1,700,201
Trucks and trailers		32,000,899			30,603,602
Right-of-use asset - finance leases		14,718,960			14,718,960
Pipeline and tanks		41,107,022			41,107,022
Sub-total		92,641,729			90,978,642
Less: accumulated depreciation		(33,827,795	)		(25,083,450	)
Property and equipment, net		58,813,934			65,895,192

Depreciation expense related to property and equipment was $2,923,020 and $1,745,446 for the three-month period ended September 30, 2024 and 2023, respectively, and $8,756,146 and $5,004,681 for the nine-month period ended September 30, 2024 and 2023, respectively.

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(5)

Related-Party Transactions

On January 1, 2023, Endeavor entered into a take or pay agreement with White Claw Crude, LLC (“WCC”), a related party controlled by James Ballengee, manager of the Company, in which the Company is to provide hauling services to WCC for their crude oil and gas products. The agreement states that if WCC does not cause 100,000 barrels per day to be hauled (subsequently amended to 75,000 barrels effective January 1, 2024) during the period January 1, 2023 through December 31, 2033 (subsequently amended to December 31, 2034), the minimum volume commitment (“MVC”), then WCC must pay the Company a deficiency fee equal to the shortage amount, in barrels, multiplied by 25% of the average rate of all hauls for the related calendar year. The Company earned $843,107 and $2,230,446 in deficiency fees during the three-month period ended September 30, 2024 and 2023, respectively, and $1,484,034 and $7,194,920 during the nine-month period ended September 30, 2024 and 2023, respectively, which are included in sales in the accompanying combined statements of operations.

On January 1, 2023, CP entered into a take or pay agreement with WCC in which WCC is to process and transfer 200,000 barrels per month, the MVC, of its crude oil and gas products through the Company’s processing and transfer terminals. The agreement states WCC must pay the Company an amount equal to the greater of the actual volume of product transferred multiplied by the applicable rate, or, the MVC multiplied by the applicable rate. The applicable rates are $1.00 per barrel up to the MVC and $.50 for each barrel in excess of the MVC. The Company earned $600,000 and $600,000 from the agreement during the three-month period ended September 30, 2024 and 2023, respectively, of which $149,310 and $187,209 was derived from volume of product transferred, respectively. The Company earned $1,800,000 and $1,800,000 during the nine-month period ended September 30, 2024 and 2023, respectively, of which $471,352 and $588,721 was derived from volume of product transferred, respectively. The above amounts are included in sales in the accompanying combined statements of operations. Of these fees, $0 and $1,642,458 were included in trade accounts receivable on the accompanying combined balance sheets as of September 30, 2024 and December 31, 2023, respectively.

On January 1, 2024, Meridian and ET allowed Horizon Truck and Trailer, LLC (“HTT”), a related party with common management, to occupy five (5) of the Company’s locations under operating leases on a month-to-month basis and reimburse the Company for the related monthly lease payments. The monthly payments on the leases range from $5,750 to $138,395 and have terms ranging from 24 to 36 months. The Company recorded lease payments due from HTT in the amount of $190,250 and $878,300 for the three and nine-month periods ended September 30, 2024, respectively, which are included in reimbursed expenses on the accompanying combined statement of operations and trade accounts receivable on the accompanying combined balance sheet.

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(5)

Related-Party Transactions (continued)

In addition, the Company agreed to pay for various expenses on behalf of HTT which totaled $0 and $1,228,786 for the three and nine-month periods ended September 30, 2024, respectively, and are included in reimbursed expenses on the accompanying combined statement of operations and of which $93,511 are included in trade accounts receivable on the accompanying combined balance sheet.

The Company used HTT’s services during the three and nine-month periods ended September 30, 2024 to perform capital repairs, upgrades, and maintenance to prepare and maintain their fleet of trucks and trailers for operations. The costs totaled $1,698,037 for the nine-month period ended September 30, 2024, of which $1,677,811 were recognized as capital improvements on the Company’s trucks and trailers.

During the year ended December 31, 2023, the Company received and provided operating loans from and to various related parties. The loans are short term in nature with no stated repayment terms. As of September 30, 2024 and December 31, 2023, the Company was owed a total of $0 and $245,368 from its related parties, respectively, and owed a total of $1,345,104 and $1,653,755, respectively, to its related parties.

(6)

Note Payable – PPP Loan

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(7)

Long-Term Debt

Long-term debt as of September 30, 2024 and December 31, 2023 consisted of the following:

	September 30, 2024		December 31, 2023
Note payable to Ford Credit dated November 1, 2019, payable in 54 monthly installments of $860 at 8.6% interest. Note is collateralized by a 2019 Ford Explorer.		0		3,008
Note payable to B1Bank dated February 12, 2020, payable in 48 monthly installments of $7,278 at 5.5% interest. Note is collateralized by 6 Dragon tractor trailers.		0		13,985
Main Street Lending Priority Loan Agreement with Business First Bank dated November 12, 2020. Interest accrues at the LIBOR rate plus 3% per annum; maturing on November 12, 2025; secured by substantially all assets of the Company.		10,760,805		10,760,805
Note payable to the U.S. Small Business Administration dated June 16, 2020, payable in 348 monthly installments of $731 beginning June 16, 2021 at 3.75% interest. Note is collateralized by substantially all assets of the Company.		10,000		160,000
Note payable to Ally Financial dated July 30, 2021, payable in 60 monthly installments of $1,645 at 6.24% interest. Note is collateralized by a 2020 Dodge Challenger.		35,582		50,393
Note payable to TD Ameritrade dated January 4, 2021, payable in 72 monthly installments of $991 at 6.89% interest. Note is collateralized by a 2019 Ford Expedition.		25,246		32,838
Note payable to TD Ameritrade dated December 9, 2021, payable in 72 monthly installments of $1,434 at 4.94% interest. Note is collateralized by a 2018 Jeep Grand Cherokee.		51,568		62,378
Note payable to Ally Financial dated December 24, 2021, payable in 60 monthly installments of $1,532 at 9.79% interest. Note is collateralized by a 2018 Ford Expedition.		51,272		46,684
Note payable to Ford Credit dated March 31, 2023, payable in 60 monthly installments of $1,046 at 0.90% interest. Note is collateralized by a 2018 Ford F-150.		54,275		57,272
Note payable to Ford Credit dated March 31, 2023, payable in 60 monthly installments of $1,093 at 0.90% interest. Note is collateralized by a 2022 Ford F-150.		51,959		60,249

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(7)

Long-Term Debt (continued)

	September 30, 2024			December 31, 2023
Notes payable to Small Business Administration dated April 10, 2020 and February 4, 2021, payable in 60 monthly installments of $30,374 and $35,024, respectively, at 1.00% interest. Notes are collateralized by the Company’s real and personal property.		2,241,898			2,482,360
Note payable to Ford Credit dated July 17, 2023, payable in 48 monthly installments of $1,622 at 9.99% interest. Note is collateralized by a 2021 Chevrolet Tahoe.		47,869			58,787
Note payable to TD Ameritrade dated January 6, 2023, payable in 72 monthly installments of $1,194 at 8.99% interest. Note is collateralized by a 2021 Ford F-250.		51,382			58,351
Note payable to Ally Financial dated February 27, 2023, payable in 72 monthly installments of $1,163 at 10.89% interest. Note is collateralized by a 2022 Ford F-150.		49,536			55,849
Note payable to Ford Credit dated July 7, 2023, payable in 48 monthly installments of $1,195 at 2.9% interest. Note is collateralized by a 2023 Ford F-150.		38,730			54,935
Note payable to Ford Credit dated September 8, 2023, payable in 48 monthly installments of $2,370 at 10.79% interest. Note is collateralized by a 2022 Dodge Charger.		72,625			86,854
Note payable to Pilot OFS Holdings, LLC dated December 31, 2023, payable in one lump sum payment of $12,500,000 plus all interest accrued at a rate of 10.5% on June 30, 2024. Note is collateralized by 405 various tractors, trucks, and trailers along with all related tools and supplies.		13,519,541			12,500,000
Note payable to Pilot OFS Holdings, LLC dated December 1, 2023, payable in 18 monthly installments of $90,431 at 10.5% interest. Note is collateralized by 28 various tanker trailers.		1,026,591			1,500,000
Total long-term debt		28,088,879			28,044,748
Less: unamortized debt issuance costs		(56,783	)		(96,095	)
Long-term debt, less unamortized debt issuance costs		28,032,096			27,948,653
Less: current portion		(16,288,433	)		(14,843,727	)
Total long-term debt, less current portion		11,743,663			13,104,926

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(7)

Long-Term Debt (continued)

Following are the maturities of long-term debt:

	2024			16,288,433
	2025			9,430,110
	2026			2,162,737
	2027			115,025
	2028			87,647
	2029 & thereafter			4,925
	Totals			28,088,877

(8)

Finance Lease Obligations

On December 28, 2021, the Company entered into six finance leases with Maxus Capital Group, LLC (Maxus) for 57 trucks and tanker trailers.

On April 21, 2022, the Company entered into two additional finance leases with Maxus, the first being for thirty (30) trucks and tanker trailers and the second being for two (2) tanker trailers.

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(8)

Finance Lease Obligations (continued)

The Company has pledged 100% of its interests in the related pipeline assets as collateral for the lease obligations.

The Company is required to make one-time security deposit payments of $56,803 and $20,955 for the first and second lease, respectively, to be used in the event of a default by the Company. In addition, the Company is required to make minimum cash reserve payments of at least $18,934 and $6,985 for the first and second lease, respectively, each month in addition to the base lease payments until Maxus has received $681,640 and $251,458 for the first and second lease, respectively. The cash reserve payments are to be used in the event of default by the Company. All security deposit amounts as well as cash reserve amounts will be fully refunded to the Company at the end of the lease term. As of September 30, 2024 and December 31, 2023, the balance of cash reserve payments made under these lease obligations was $523,352 and $331,988, respectively. The Company incurred $124,650 of lease costs from the preceding transaction that are being amortized over the 5-year term of the leases.

The terms of the lease agreement, including the Company’s option to purchase the pipeline assets from Maxus at the end of the lease term, preclude the Company from using sale and leaseback accounting treatment in accordance with FASB ASC-842-40. As such, the transaction is being accounted for as a financing arrangement, whereby the Company does not record a sale or derecognize the pipeline assets. The Company continues to record depreciation expense on the pipeline assets and has recorded a financial liability due to Maxus (included in finance lease obligations in the accompanying combined balance sheet).

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(8)

Finance Lease Obligations (continued)

On March 22, 2023, the Company entered into three (3) additional finance leases with Maxus for 90 trucks and tanker trailers.

The terms of the lease agreements, including the Company’s option to purchase the leased assets from Maxus at the end of the lease terms, classify the leases as finance leases in accordance with FASB ASC 842. As such, the Company has recorded lease obligations equal to the present value of the future cash payments using the interest rate implicit in the leases of 11.56% as well as lease assets equal to the present value of the future cash payments using an interest rate of 11.56%.

On November 20, 2023, the Company entered into five (5) additional finance leases with Maxus for one hundred and five (105) trucks and tanker trailers.

The terms of the lease agreements, including the Company’s option to purchase the leased assets from Maxus at the end of the lease terms, classify the leases as finance leases in accordance with FASB ASC 842. As such, the Company has recorded lease obligations equal to the present value of the future cash payments using the implicit borrowing rate of similar leases with Maxus for similar assets and terms of 11.56% as well as lease assets equal to the present value of the future cash payments using an interest rate of 11.56% plus lease costs of $302,750 and prepaid lease payments of $235,054.

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(8)

Finance Lease Obligations (continued)

Future minimum lease payments for each of the next four years under the Maxus lease obligation and a reconciliation of undiscounted cash flows to the balance of the lease obligation as of September 30, 2024 on the accompanying combined balance sheet are as follows:

2024	1,693,233
2025	4,911,823
2026	4,462,499
2027	854,344
Total minimum lease payments	11,921,899
Less: amount representing interest	(2,859,434	)
Present value of net minimum payments	9,062,465
Add: carrying value of lease obligation at end of lease term	2,832,813
Total lease obligation	11,895,278
Less: unamortized financing fees	(81,023	)
Total lease obligation, less unamortized financing fees	11,814,255
Less: current portion	(1,693,233	)
Total lease obligation, less current portion	10,121,022

(9)

Operating Lease Liabilities

As part of the business acquisition of ET, dated December 22, 2023, Meridian assumed three (3) leases with Pilot Water Solutions SWD, LLC for the use of trucking yards, shops, and a housing development to be used in trucking operations. The terms of the leases range from twenty-four (24) to thirty-six (36) months with monthly installments ranging from $5,750 to $138,395.

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(9)

Operating Lease Liabilities (continued)

The terms of the lease agreements classify the leases as operating leases in accordance with FASB ASC 842. As such, the Company has recorded a lease obligation as well as a lease asset equal to the present value of the future cash payments. In determining the discount rate for the calculation of future cash payments, the Company used the risk-free discount rate of 4.336% and 4.042%, which are the rates of a U.S. government bond as of the commencement dates of the leases and for a term comparable to the respective lease terms.

Under the provisions of ASC 842, the Company has elected the short-term lease expedient. A short-term lease is a lease that, as of the commencement date, has a lease term of 12 months or less and does not include an option to purchase the underlying asset that the lessee is reasonably certain to exercise. For such leases, the Company will not apply the recognition requirements of Topic 842 and instead will recognize the lease payments as lease cost on a straight-line basis over the lease term. Lease costs related to short-term leases were $319,899 and $78,145 for the three- month period ended September 30, 2024 and 2023, respectively, and $1,823,017 and $179,992 for the nine-month period ended September 30, 2024 and 2023, respectively, and are included in lease expense on the accompanying combined statements of operations.

Future minimum lease payments for each of the next three years under the operating lease obligations and a reconciliation of the undiscounted cash flows to the balance of the operating lease obligation as of September 30, 2024 on the accompanying combined balance sheet are as follows:

2024	617,935
2025	2,431,740
2026	978,975
Total minimum lease payments	4,028,650
Less: amount representing interest	(129,151	)
Total lease obligation	3,899,499
Less: current portion	(617,935	)
Total lease obligation, less current portion	3,281,564

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(10)

Business Combination

The following is a recalculated list of net identifiable assets at estimated fair value assumed as of the date of the acquisition:

	Total cash consideration			12,500,000
	Purchase price allocation:
	Accounts receivable			1,500,000
	Inventory			603,731
	Property and equipment, net			10,396,269
	Net assets acquired			12,500,000

As disclosed in Note 1, effective January 1, 2024, the Company transferred 100% of its membership interests in ET to its parent company, Jorgan.

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(11)

Line of Credit

On January 6, 2023, the Company entered into an accounts receivable factoring agreement with a financial institution that allows the Company to sell their currently outstanding accounts receivable for cash up to a maximum principal balance of $7,500,000 (hereinafter “line of credit”). The Company is charged a fixed service charge by the institution in the amount of 1% of all receivables purchased in addition to a variable service charge of 1.75% of the outstanding amount of a purchased receivable per day up to 120 days or until the face amount of the purchased receivable is collected by the financial institution. The agreement states that if a receivable becomes 120 days or more outstanding, then the institution may require the Company to repurchase the account at face value. To facilitate the potential buyback, the agreement states that the Company must keep a reserve account with the institution in an amount equal to 10% of all purchased accounts. The outstanding principal balance of the line of credit, net unamortized debt issuance costs, was $5,601,030 and $5,575,005 as of September 30, 2024 and December 31, 2023, respectively. The amount of the reserve account was $1,902,799 and $1,262,525 as of September 30, 2024 and December 31, 2023, respectively, and is included in restricted cash in the accompanying combined balance sheets.

On May 9, 2024, the Company entered into an accounts receivable factoring agreement with a financial institution that allows the Company to sell their currently outstanding accounts receivable for cash up to a maximum principal balance of $7,000,000 (hereinafter “line of credit”). The Company is charged a fixed service charge by the institution in the amount of 1% of all receivables purchased in addition to a variable service charge of 2.5% of the face amount of a purchased receivable per day up to 120 days or until the face amount of the purchased receivable is collected by the financial institution. The agreement states that if a receivable becomes 120 days or more outstanding, then the institution may require the Company to repurchase the account at face value. To facilitate the potential buyback, the agreement states that the Company must keep a reserve account with the institution in an amount equal to 10% of all purchased accounts. The outstanding principal balance of the line of credit, net of unamortized issuance costs, was $5,234,666 and $0 as of September 30, 2024 and December 31, 2023, respectively. The amount of the reserve account was $1,355,850 and $0 as of September 30, 2024 and December 31, 2023, respectively, and is included in restricted cash in the accompanying combined balance sheets.

(12)

Interest Rate Swap

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(13)

Short-Term Notes Payable

On November 20, 2023, the Company entered into a short-term financing agreement with Maxus for a principal amount of $1,500,000. The Company will make interest only payments monthly until the maturity of the note, upon which all outstanding principal and accrued interest is due. The note was originally scheduled to mature six months from the date of borrowing, was subsequently extended an additional six months, and then subsequently extended again for an additional six months to a maturity date of May 31, 2025. The outstanding principal balance was $1,500,000 and $1,466,952 as of September 30, 2024 and December 31, 2023, respectively. The note is collateralized by twenty-eight (28) trucks and tanker trailers.

On November 30, 2023, the Company entered into a cash advance agreement with Curve Capital, LLC (“Curve”) in which the Company pledged future receipts of its accounts receivable in exchange for $1,000,000 in cash. The Company is required to pay Curve a total of $1,390,000 in weekly installments of $38,612 at 98.85% interest. The outstanding principal was $845,552 as of December 31, 2023. On March 14, 2024, the Company refinanced its original agreement with Curve for $2,000,000, of which $810,820 was used to pay off the remaining principal and interest balances of the original agreement. The Company is required to pay Curve a total of $2,780,000 in weekly installments of $76,000 at 99.82%. On August 20, 2024, the Company refinanced its second agreement with Curve for $2,250,000, of which $1,108,000 was used to pay off the remaining principal and interest balances of the second agreement. The Company is required to pay Curve a total of $3,206,250 in weekly installments of $99,500 at 124.86% interest and the principal balance as of September 30, 2024 was $1,915,992.

On February 13, 2024, the Company entered into a short-term financing agreement with Maxus for a principal amount of $3,000,000. The Company will make interest only payments monthly until the maturity of the note, September 1, 2024, upon which all outstanding principal and accrued interest is due. The note is collateralized by a fleet of trucks and trailers. The outstanding principal balance, net of unamortized debt issuance costs, was $3,000,000 and $0 as of September 30, 2024 and December 31, 2023, respectively. On August 15, 2024, the Company received a three-month extension until November 30, 2024 and subsequently received a six month extension until May 31, 2025.

On June 20, 2024, the Company entered into a short-term financing agreement with Agile Lending, LLC for a principal amount of $1,312,500. The Company is required to make weekly installments of $67,500 at 145.93% interest until maturity on January 3, 2025. The outstanding principal balance was $772,646 and $0 as of September 30, 2024 and December 31, 2023, respectively.

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(14)

Adoption of New Accounting Standard

The Company adopted the standard effective January 1, 2023. The impact of the adoption was not considered material to the combined financial statements.

(15)

Sale of Membership Interests

Subsequent to September 30, 2024, all closing processes were completed and Vivakor completed its acquisition of 100% of the membership interests of the Company effective October 1, 2024.

(16)

Default on Promissory Notes

See independent auditors’ review report

Endeavor Crude, LLC, Meridian Equipment Leasing, LLC

and Equipment Transport, LLC

Notes to the Combined Financial Statements (Unaudited)

(16)

Default on Promissory Notes (continued)

Both letters demand that full payment be made by Meridian on the defaulted obligations no later than August 30, 2024. As of December 10, 2024, the date the combined financial statements were available to be issued, Meridian has made payments of $500,000 towards these obligations.

Subsequent to September 30, 2024, Meridian entered into a Letter Agreement regarding the secured promissory note and related loan documents with Pilot (“Extension Agreement”). Effective October 1, 2024, Pilot agreed to rescind demands for payments for outstanding amounts under the notes payable, and extend the due dates until December 31, 2024, subject to full payment of the outstanding assigned accounts receivable amount, which is subject to Meridian obtaining a full and final closing of a revolving line of credit to satisfy these obligations.

The Extension Agreement will terminate if the assigned accounts receivable payments are not made by the Company prior to December 31, 2024. As of December 10, 2024, the date the combined financial statements were available to be issued, Meridian has yet to make the payments on the assigned accounts receivable obligation.

Additionally, as shown in the accompanying financial statements, the Company’s current liabilities exceed its current assets by $31,063,269 as of September 30, 2024. These factors, along with the uncertain conditions Meridian faces regarding its notes payable with Pilot, create substantial doubt about the Company’s ability to continue as a going concern. Management of the Company has evaluated these conditions and is currently working with outside creditors to obtain additional financing to repay its obligations to Pilot. While the Company works to obtain additional financing, they have also received extensions on the payment of outstanding obligations in default through December 31, 2024, subject to certain conditions described above. The ability of the Company to continue as a going concern and meet its obligations as they become due is dependent on the Company’s ability to maintain the extension stipulations required by Pilot and the Company’s ability to obtain additional financing. The combined financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

See independent auditors’ review report

Exhibit 99.6

Silver Fuels Processing, LLC

Financial Statements

as of September 30, 2024 and December 31, 2023

and for the three-month and nine-month

periods ended September 30, 2024 and 2023

Silver Fuels Processing, LLC

Notes to the Financial Statements

Independent Auditors’ Review Report		1-2

Balance Sheets as of September 30, 2024 (Unaudited) and December 31, 2023		3

Statements of Operations for the three-month and nine-month periods ended September 30, 2024 and 2023 (Unaudited)		4

Statements of Members’ Equity for the three-month and nine-month periods ended September 30, 2024 and 2023 (Unaudited)		5

Statements of Cash Flows for the nine-month periods ended September 30, 2024 and 2023 (Unaudited)		6

Notes to the Financial Statements (Unaudited)		7-11

INDEPENDENT AUDITORS’ REVIEW REPORT

Management

Silver Fuels Processing, LLC

Dallas, Texas

Results of Review of Interim Financial Information

We have reviewed the accompanying financial statements of Silver Fuels Processing, LLC, which comprise the balance sheet as of September 30, 2024 and the related statements of operations and members’ equity for the three-month and nine-month periods ended September 30, 2024 and 2023, and statements of cash flows for the nine-month periods ended September 30, 2024 and 2023, and the related notes to the financial statements (collectively referred to as the “interim financial information”).

Basis for Review Results

We conducted our reviews in accordance with auditing standards generally accepted in the United States of America (GAAS) applicable to reviews of interim financial information. A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. A review of interim financial information is substantially less in scope than an audit in accordance with GAAS, the objective of which is the expression of an opinion regarding the financial information as a whole, and accordingly, we do not express such an opinion. We are required to be independent of Silver Fuels Processing, LLC and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements related to our reviews. We believe that the results of the review procedures provide a reasonable basis for our conclusion.

Related-Party Transactions

Responsibilities of Management for the Interim Financial Information

Report on Balance Sheet as of December 31, 2023

Shreveport, Louisiana

December 6, 2024

Silver Fuels Processing, LLC

Balance Sheets

as of September 30, 2024 (Unaudited) and December 31, 2023

	September 30, 2024 (Unaudited)		December 31, 2023
Assets
Current assets
Cash and cash equivalents		1,699		5,990
Accounts receivable, Notes 2		0		0
Prepaid expense		108,889		63,309
Due from related parties, Note 4		20,712		55,725
Other current assets		1,013		8,312
Total current assets		132,313		133,336

Property and equipment, net, Notes 2 and 3		902,680		1,157,113

Other Assets
Security deposits		12,992		2,992
Total other assets		12,992		2,992

Total assets		1,047,985		1,293,441

Liabilities and members’ equity
Current liabilities
Accounts payable		36,009		325,807
Due to related parties, Note 4		282,481		0
Total current liabilities		318,490		325,807

Members’ equity		729,495		967,634

Total liabilities and members’ equity		1,047,985		1,293,441

See independent auditors’ review report and accompanying notes to the financial statements.

Silver Fuels Processing, LLC

Statements of Operations

for the three-month and nine-month periods ended September 30, 2024 and 2023 (Unaudited)

	Three Months Ended September 30,					Nine Months Ended September 30,
	2024			2023		2024		2023
Revenues
Sales		189,750			165,000		569,250		465,000
Reimbursed expenses - related party		23,524			10,825		81,884		100,386
Total income		213,274			175,825		651,134		565,386

Operating expenses
Bank charges		110			0		450		0
Depreciation		83,886			60,410		248,004		180,218
Insurance		47,238			26,475		127,872		61,775
Miscellaneous		15,316			833		20,198		8,620
Office supplies		525			16		608		212
Payroll		18,565			18,765		55,978		56,449
Professional fees		26,808			7,250		53,475		31,523
Repairs and maintenance		12,238			859		36,327		46,944
Travel		0			1,717		6,094		8,529
Utilities		6,411			5,481		22,376		21,001
Rent		16,000			16,000		48,025		45,500
Contract labor		0			0		5,885		0
Station		4,040			0		13,675		2,219
Total operating expenses		231,137			137,806		638,967		462,990

Income (loss) from operations		(17,863	)		38,019		12,167		102,396

Other income
Other income		0			0		0		33,750
Total other income		0			0		0		33,750
Net income (loss)		(17,863	)		38,019		12,167		136,146

See independent auditors’ review report and accompanying notes to the financial statements.

Silver Fuels Processing, LLC
Statements of Members’ Equity
for the three-month and nine-month periods ended September 30, 2024 and 2023 (Unaudited)

Balance, June 30, 2024 (Unaudited)	1,069,664

Net loss	(17,863	)
Members’ contributions	21,500
Members’ distributions	(343,806	)

Balance, September 30, 2024 (Unaudited)	729,495

Balance, December 31, 2023	967,634

Net income	12,167
Members’ contributions	93,500
Members’ distributions	(343,806	)

Balance, September 30, 2024 (Unaudited)	729,495

Balance, June 30, 2023 (Unaudited)	607,426

Net income	38,019
Members’ contributions	12,500
Members’ distributions	0

Balance, September 30, 2023 (Unaudited)	657,945

Balance, December 31, 2022	792,619

Net income	136,146
Members’ contributions	133,500
Members’ distributions	(404,320	)

Balance, September 30, 2023 (Unaudited)	657,945

See independent auditors’ review report and accompanying notes to the financial statements.

Silver Fuels Processing, LLC
Statements of Cash Flows
for the nine-month periods ended September 30, 2024 and 2023 (Unaudited)

	Nine Months Ended September 30,
	2024			2023
Cash flows from operating activities
Net income		12,167			136,146
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation		248,004			180,218
(Increase) decrease in:
Accounts receivables		(343,806	)		(579,328	)
Due from related parties		35,013			0
Prepaid expenses		(45,580	)		(13,189	)
Security deposit		(10,000	)		0
Other current assets		7,299			0
Increase (decrease) in:
Accounts payable		(176,917	)		149,704
Due to related party		282,481			0
Net cash provided by (used in) operating activities		8,661			(126,449	)

Cash flows from investing activities
Purchases of property and equipment		(106,452	)		(21,250	)
Net cash used in investing activities		(106,452	)		(21,250	)

Cash flows from financing activities
Contributions from members		93,500			133,500
Distributions to members		0			(30,000	)
Net cash provided by financing activities		93,500			103,500

Net change in cash and cash equivalents		(4,291	)		(44,199	)

Beginning cash and cash equivalents		5,990			47,015

Ending cash and cash equivalents		1,699			2,816

Supplementary non-cash investing and financing activities:
Assignment of related-party receivable to parent through distributions		343,806			374,320
Transfer of property improvements to related party		112,880			0

See independent auditors’ review report and accompanying notes to the financial statements.

Silver Fuels Processing, LLC

Notes to the Financial Statements

(1)

Nature of Business

(2)

Summary of Significant Accounting Policies

Cash and cash equivalents – For the purpose of reporting cash flows, cash and cash equivalents include all cash on hand and cash on deposit with maturities of less than three months.

Due to all accounts receivable being due from a related party, and considered 100% collectible, management has not calculated an allowance for credit losses as of September 30, 2024 and December 31, 2023.

Property and equipment – Property and equipment is stated at cost. Depreciation is computed by the straight-line method over the assets’ estimated useful lives of 7 years.

See independent auditors’ review report.

Silver Fuels Processing, LLC

Notes to the Financial Statements

(2)

Summary of Significant Accounting Policies (continued)

Compensated absences – Employees of the Company are entitled to paid vacations, sick days and other time off depending on job classification, length of service and other factors. The Company does not accumulate vacation or sick time, the estimate for the amount of compensation for future absences was immaterial and, accordingly, no liability has been recorded in the accompanying financial statements. The Company’s policy is to recognize the costs of compensated absences when paid to the individual employees.

Subsequent events – Management of the Company has evaluated subsequent events, for recognition and disclosure, through December 6, 2024, the date the financial statements were available to be issued.

See independent auditors’ review report.

Silver Fuels Processing, LLC

Notes to the Financial Statements

(3)

Property and Equipment

The following is a summary of property and equipment as of September 30, 2024 and December 31, 2023:

	September 30, 2024		December 31, 2023
Basa station		1,130,787		1,137,216
Midland station		87,581		87,581
Posse Monroe station		689,557		689,557
Wasson station		376,711		376,711
Steel Tanks		64,175		64,175
Sub-total	$	2,348,811	$	2,355,240
Less: accumulated depreciation		1,446,131		1,198,127
Totals	$	902,680	$	1,157,113

Depreciation expense related to property and equipment was $83,886 and $60,410 for the three- month periods ended September 30, 2024 and 2023, respectively, and was $248,004 and $180,218 for the nine-month periods ended September 30, 2024 and 2023, respectively.

(4)

Related-Party Transactions

As disclosed in Notes 2 and 5, the Company’s only Customer is WCC, a related party owned and managed by Jorgan Development, a Louisiana limited liability company, the majority owner of the Company.

See independent auditors’ review report.

Silver Fuels Processing, LLC

Notes to the Financial Statements

(4)

Related-Party Transactions (continued)

Revenues from WCC during the three-month periods ended September 30, 2024 and 2023 totaled $213,274 and $175,825, respectively, which includes $189,750 and $165,000, respectively, of fee income, and $23,524 and $10,825, respectively, of reimbursed expenses. Revenues from WCC during the nine-month periods ended September 30, 2024 and 2023 totaled $651,134 and $565,386, respectively, which includes $569,250 and $465,000, respectively, of fee income and $81,884 and $100,386, respectively, of reimbursed expenses.

During the periods ended September 30, 2024 and December 31, 2023, the Company provided and received operating loans to and from various related parties. The operating loans have no stated repayments terms. As of September 30, 2024 and December 31, 2023, the Company was due $20,712 and $55,725, respectively, from its related parties and owed $282,481 and $0, respectively, to its related parties.

The Company rents crude oil stations on a month-to-month basis from Endeavor Crude, LLC, a related party owned and managed by Jorgan. Total rent expense related to this lease was $16,000 and $16,000 for the three-month periods ended September 30, 2024 and 2023, respectively, and was $48,025 and $45,500 for the nine-month periods ended September 30, 2024 and 2023, respectively, and is included in rent expense on the accompanying statements of operations.

(5)

Major Customers and Concentration of Credit Risk

The Company’s only customer is WCC. WCC accounts for 100% of the Company’s revenue for the three and nine-month periods ended September 30, 2024 and 2023.

See independent auditors’ review report.

Silver Fuels Processing, LLC

Notes to the Financial Statements

(6)

Adoption of New Accounting Standards

The Company adopted the standard effective January 1, 2023. The impact of the adoption was not considered material to the financial statements.

(7)

Sale of Membership Interests

Subsequent to September 30, 2024, all closing processes were completed and Vivakor completed its acquisition of 100% of the membership interests of the Company effective October 1, 2024.

See independent auditors’ review report.

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.

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.*

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

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.*

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

Cover	Oct. 01, 2024
Cover [Abstract]
Document Type	8-K/A
Amendment Flag	true
Amendment Description	On October 7, 2024, Vivakor, Inc. (the “Company”), a Nevada corporation, filed a Current Report on Form 8-K (the “Initial Report”) to report that on October 1, 2024, the Company, Jorgan Development, LLC, a Louisiana limited liability company (“Jorgan”) and JBAH Holdings, LLC, a Texas limited liability company (“JBAH” and, together with Jorgan, the “Sellers”), as the equity holders of Endeavor Crude, LLC, a Texas limited liability company, Equipment Transport, LLC, a Pennsylvania limited liability company, Meridian Equipment Leasing, LLC, a Texas limited liability company, and Silver Fuels Processing, LLC, a Texas limited liability company (collectively, the “Endeavor Entities”) closed the transactions that were the subject of the previously-disclosed Membership Interest Purchase Agreement among them dated March 21, 2024, as amended (the “MIPA”). This Current Report on Form 8-K/A (this “Amendment”) amends and supplements the Initial Report to provide financial statements of the Endeavor Entities, and the pro forma financial statements of the Company required by Item 9.01 of Form 8-K. No other modifications to the Initial Report are being made by this Amendment. This Amendment should be read in connection with the Initial Report, which provides a more complete description of the MIPA and transactions contemplated thereby. The financial statements of the Endeavor Entities are presented in two sets of financial statements for each period reported, with one set of financial statements being the combined financial statements of Endeavor Crude, LLC, which includes the combined financial results of Endeavor Crude, LLC, Equipment Transport, LLC and Meridian Equipment Leasing, LLC, and the second set of financial statements being the financial statements of Silver Fuels Processing, LLC.
Document Period End Date	Oct. 01, 2024
Entity File Number	001-41286
Entity Registrant Name	VIVAKOR, INC.
Entity Central Index Key	0001450704
Entity Tax Identification Number	26-2178141
Entity Incorporation, State or Country Code	NV
Entity Address, Address Line One	5220 Spring Valley Road
Entity Address, Address Line Two	Suite 500
Entity Address, City or Town	Dallas
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	75254
City Area Code	(949)
Local Phone Number	281-2606
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock
Trading Symbol	VIVK
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false

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VIVK Vivakor Inc