Cover
Cover | 9 Months Ended |
Sep. 30, 2022 | |
Cover [Abstract] | |
Document Type | S-1/A |
Amendment Flag | true |
Amendment Description | client needed changes |
Document Fiscal Period Focus | Q3 |
Document Fiscal Year Focus | 2022 |
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 | 4101 North Thanksgiving Way |
Entity Address, City or Town | Lehi |
Entity Address, State or Province | UT |
Entity Address, Postal Zip Code | 84043 |
City Area Code | 949 |
Local Phone Number | 281-2606 |
Entity Filer Category | Non-accelerated Filer |
Entity Small Business | true |
Entity Emerging Growth Company | true |
Elected Not To Use the Extended Transition Period | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 4,373,926 | $ 1,293,767 |
Cash and cash equivalents attributed to variable interest entity | 147,865 | 199,952 |
Accounts Receivable, less allowances of none and $33,000, respectively | 5,524,133 | 845 |
Prepaid expenses | 67,463 | 0 |
Marketable securities | 2,892,319 | 2,231,218 |
Inventories | 253,609 | 192,000 |
Precious metal concentrate | 1,166,709 | 1,166,709 |
Other assets | 784,998 | 73,245 |
Total current assets | 15,211,022 | 5,157,736 |
Other investments | 4,000 | 4,000 |
Notes receivable | 1,156,526 | 1,194,235 |
Property and equipment, net | 31,545,826 | 24,692,111 |
Rights of use assets- operating leases | 648,201 | 663,291 |
License agreement, net | 2,255,610 | 2,370,835 |
Intellectual property, net | 37,422,454 | 13,662,037 |
Goodwill | 6,562,028 | 0 |
Total assets | 94,805,667 | 47,744,245 |
Current liabilities: | ||
Accounts payable and accrued expenses | 9,473,001 | 2,023,985 |
Operating lease liabilities, current | 364,103 | 287,769 |
Finance lease liabilities, current | 652,440 | 0 |
Loans and notes payable, current | 971,441 | 1,511,447 |
Loans and notes payable, current attributed to variable interest entity | 2,597,709 | 3,416,379 |
Long-term debt (working interest royalty programs), current | 9,363 | 3,256 |
Total current liabilities | 14,068,057 | 7,242,836 |
Operating lease liabilities, long term | 338,532 | 434,109 |
Finance lease liabilities, long term | 3,222,920 | 0 |
Loans and notes payable, long term | 29,376,628 | 1,185,970 |
Long-term debt (working interest royalty programs) | 4,968,740 | 6,171,298 |
Deferred income tax liabilities | 5,156,899 | 5,156,899 |
Total liabilities | 57,131,776 | 20,191,112 |
Stockholders' equity: | ||
Convertible, preferred stock, $.001 par value; 3,400,000 shares authorized;(1) Series A- 66,667 issued and outstanding(1) | 0 | 67 |
Common stock, $.001 par value; 41,666,667 shares authorized; 18,064,838 and 12,330,859 were issued and outstanding as of September 30, 2022 and December 31, 2021(1) | 18,065 | 12,331 |
Additional paid-in capital | 73,304,687 | 58,279,590 |
Treasury stock, at cost | (20,000) | (20,000) |
Accumulated deficit | (42,817,572) | (35,731,359) |
Total Vivakor, Inc. stockholders' equity | 30,485,180 | 22,540,629 |
Noncontrolling interest | 7,188,711 | 5,012,504 |
Total stockholders' equity | 37,673,891 | 27,553,133 |
Total liabilities and stockholders’ equity | $ 94,805,667 | $ 47,744,245 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Accounts receivable allowance | $ 0 | $ 33,000 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 41,666,667 | 41,666,667 |
Common stock, shares issued | 18,064,838 | 12,330,859 |
Common stock, shares outstanding | 18,064,838 | 12,330,859 |
Convertible Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock shares authorized | 3,400,000 | 3,400,000 |
Series A Preferred Stock [Member] | ||
Preferred stock, shares issued | 66,667 | 66,667 |
Preferred stock, shares outstanding | 66,667 | 66,667 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Statement [Abstract] | ||||
Revenues | $ 11,765,975 | $ 965,757 | $ 11,765,975 | $ 1,082,757 |
Cost of revenues | 10,553,375 | 938,226 | 10,553,375 | 1,050,676 |
Gross profit | 1,212,600 | 27,531 | 1,212,600 | 32,081 |
Operating expenses: | ||||
Sales and marketing | 50,174 | 11,329 | 360,765 | 839,769 |
General and administrative | 2,373,615 | 1,057,710 | 6,609,175 | 3,367,104 |
Amortization and depreciation | 1,119,737 | 364,509 | 2,053,550 | 1,092,423 |
Total operating expenses | 3,543,526 | 1,433,548 | 9,023,490 | 5,299,296 |
Loss from operations | (2,330,926) | (1,406,017) | (7,810,890) | (5,267,215) |
Other income (expense): | ||||
Unrealized gain (loss) on marketable securities | 1,074,290 | (2,481,175) | 661,101 | 1,253,100 |
Interest income | 5,782 | 827 | 18,243 | 3,312 |
Interest expense | (512,217) | (320,836) | (627,163) | (716,305) |
Gain on disposition asset | 0 | 0 | 2,456 | 87,044 |
Other income | 50 | 88,359 | 40,134 | 95,199 |
Total other income (expense) | 567,905 | (2,712,825) | 94,771 | 722,350 |
Loss before provision for income taxes | (1,763,021) | (4,118,842) | (7,716,119) | (4,544,865) |
Provision for income taxes | 0 | 723,911 | (800) | 0 |
Consolidated net loss | (1,763,021) | (3,394,931) | (7,716,919) | (4,544,865) |
Less: Net loss attributable to noncontrolling interests | (183,008) | (485,679) | (630,706) | (1,741,523) |
Net loss attributable to Vivakor, Inc. | (1,580,013) | (2,909,252) | (7,086,213) | (2,803,342) |
Net loss attributable to common shareholders | (1,580,013) | (2,909,252) | (7,086,213) | (2,803,342) |
Dividend on preferred stock | 0 | 0 | 0 | 42,196 |
Net income loss to parent | $ (1,580,013) | $ (2,909,252) | $ (7,086,213) | $ (2,845,538) |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (Parenthetical) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Statement [Abstract] | ||||
Earnings Per Share, Basic | $ (0.09) | $ (0.24) | $ (0.46) | $ (0.24) |
Earnings Per Share, Diluted | $ (0.09) | $ (0.24) | $ (0.46) | $ (0.24) |
Weighted Average Number of Shares Outstanding, Basic | 17,047,489 | 12,303,924 | 15,284,240 | 11,863,943 |
Weighted Average Number of Shares Outstanding, Diluted | 17,047,489 | 12,303,924 | 15,284,240 | 11,863,943 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Treasury Stock [Member] | Retained Earnings [Member] | Noncontrolling Interest [Member] | Total | Series A Preferred Stocks [Member] |
Beginning balance, value at Dec. 31, 2020 | $ 11,256 | $ 45,623,146 | $ (20,000) | $ (30,204,992) | $ 1,279,089 | $ 16,688,566 | |
Beginning balance, shares at Dec. 31, 2020 | 11,255,967 | 66,667 | |||||
Common Stock issued for services(1) | $ 34 | 437,967 | 438,001 | ||||
Common Stock issued for services, shares | 33,667 | ||||||
Common Stock issued for a reduction of liabilities(1) | $ 49 | 374,753 | 374,802 | ||||
Common Stock issued for a reduction in liabilities, shares | 49,010 | ||||||
Common Stock issued for the purchase of a license(1) | $ 17 | 224,983 | 225,000 | ||||
Common Stock issued for the purchase of a license, shares | 16,667 | ||||||
Conversion of temporary equity Series B, B-1, and C-1 Preferred Stock to Common Stock(1) | $ 956 | 9,466,648 | 9,467,604 | ||||
Conversion of temporary equity Series B, B-1, and C-1 Preferred Stock to Common Stock, shares | 955,947 | ||||||
Stock options issued for services | 1,157,500 | 1,157,500 | |||||
Stock based compensation | 334,584 | 334,584 | |||||
Issuance of noncontrolling interest for a reduction of debt | 2,720,001 | 2,720,001 | |||||
Dividend paid in Series B-1 Preferred Stock | (42,196) | (42,196) | |||||
Net income (loss) | (2,803,342) | (1,741,523) | (4,544,865) | ||||
Ending balance, value at Sep. 30, 2021 | $ 12,311 | 57,619,582 | (20,000) | (33,050,530) | 2,257,567 | 26,818,997 | |
Ending balance, shares at Sep. 30, 2021 | 12,311,257 | 66,667 | |||||
Beginning balance, value at Jun. 30, 2021 | $ 12,291 | 56,970,572 | (20,000) | (30,141,278) | 758,245 | 27,579,897 | |
Beginning balance, shares at Jun. 30, 2021 | 12,291,416 | 66,667 | |||||
Common Stock issued for a reduction of liabilities(1) | $ 20 | 109,982 | 110,002 | ||||
Common Stock issued for a reduction in liabilities, shares | 19,841 | ||||||
Stock options issued for services | 427,500 | 427,500 | |||||
Stock based compensation | 111,528 | 111,528 | |||||
Issuance of noncontrolling interest for a reduction of debt | 1,985,001 | 1,985,001 | |||||
Net income (loss) | (2,909,252) | (485,679) | (3,394,931) | ||||
Ending balance, value at Sep. 30, 2021 | $ 12,311 | 57,619,582 | (20,000) | (33,050,530) | 2,257,567 | 26,818,997 | |
Ending balance, shares at Sep. 30, 2021 | 12,311,257 | 66,667 | |||||
Beginning balance, value at Dec. 31, 2021 | $ 12,331 | 58,279,590 | (20,000) | (35,731,359) | 5,012,504 | 27,553,133 | |
Beginning balance, shares at Dec. 31, 2021 | 12,330,859 | 66,667 | |||||
Common Stock issued for stock awards | $ 16 | (16) | |||||
Common Stock issued for stock awards | 16,667 | ||||||
Common Stock issued for a reduction of liabilities(1) | $ 273 | 1,144,719 | 1,144,992 | ||||
Common Stock issued for a reduction in liabilities, shares | 272,156 | ||||||
Conversion of Series A Preferred Stock to Common Stock | $ 833 | (766) | |||||
Conversion of Series A Preferred Stock to Common Stock, shares | 833,333 | (66,667) | |||||
Common Stock issued for cash | $ 1,600 | 6,238,400 | 6,240,000 | ||||
Common Stock issued for cash, shares | 1,600,000 | ||||||
Common stock issued for fractional shares from reverse stock split | $ 2 | 2 | |||||
Common stock issued for fractional shares from reverse stock split, shares | 2,271 | ||||||
Common stock issued as part consideration for the purchase of Silver Fuels Delhi, LLC and White Claw Colorado City, LLC | $ 3,010 | 4,284,645 | 4,287,655 | ||||
Common stock issued as part consideration for the purchase of Silver Fuels Delhi, LLC and White Claw Colorado City, LLC, shares | 3,009,552 | ||||||
Stock options issued for services | 1,172,500 | 1,172,500 | |||||
Stock based compensation | 2,185,615 | 2,185,615 | |||||
Distributions to noncontrolling interest | (593,087) | (593,087) | |||||
Issuance of noncontrolling interest for a reduction of debt | 3,400,000 | 3,400,000 | |||||
Net income (loss) | (7,086,213) | (630,706) | (7,716,919) | ||||
Ending balance, value at Sep. 30, 2022 | $ 18,065 | 73,304,687 | (20,000) | (42,817,572) | 7,188,711 | 37,673,891 | |
Ending balance, shares at Sep. 30, 2022 | 18,064,838 | 0 | |||||
Beginning balance, value at Jun. 30, 2022 | $ 15,039 | 67,857,646 | (20,000) | (41,237,559) | 7,245,917 | 33,861,043 | |
Beginning balance, shares at Jun. 30, 2022 | 15,038,619 | 0 | |||||
Common Stock issued for stock awards | $ 16 | (16) | |||||
Common Stock issued for stock awards | 16,667 | ||||||
Common stock issued as part consideration for the purchase of Silver Fuels Delhi, LLC and White Claw Colorado City, LLC | $ 3,010 | 4,284,645 | 4,287,655 | ||||
Common stock issued as part consideration for the purchase of Silver Fuels Delhi, LLC and White Claw Colorado City, LLC, shares | 3,009,552 | ||||||
Stock options issued for services | 317,500 | 317,500 | |||||
Stock based compensation | 844,912 | 844,912 | |||||
Distributions to noncontrolling interest | (249,198) | (249,198) | |||||
Issuance of noncontrolling interest for a reduction of debt | 375,000 | 375,000 | |||||
Net income (loss) | (1,580,013) | (183,008) | (1,763,021) | ||||
Ending balance, value at Sep. 30, 2022 | $ 18,065 | $ 73,304,687 | $ (20,000) | $ (42,817,572) | $ 7,188,711 | $ 37,673,891 | |
Ending balance, shares at Sep. 30, 2022 | 18,064,838 | 0 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
OPERATING ACTIVITIES: | ||
Consolidated net loss | $ (7,716,919) | $ (4,544,865) |
Adjustments to reconcile net income to net cash used in operating activities: | ||
Depreciation and amortization | 2,053,550 | 1,092,423 |
Forgiveness of notes payable | 0 | (90,711) |
Common stock options issued for services | 1,172,500 | 1,157,500 |
Common stock issued for services | 0 | 438,001 |
Unrealized gain marketable securities | (661,101) | (1,253,100) |
Gain on disposal of asset | (2,456) | (87,044) |
Deferred income taxes | 0 | (19,625) |
Stock-based compensation | 2,185,615 | 334,584 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 652,851 | 6,890 |
Prepaid expenses | 23,960 | 0 |
Inventory | 147,719 | 0 |
Other assets | (164,919) | 13,807 |
Right of use assets- operating leases | 15,090 | 162,815 |
Operating lease liabilities | (16,177) | (162,815) |
Accounts payable and accrued expenses | (1,751,613) | (313,879) |
Interest on notes receivable | (18,243) | (3,312) |
Interest on notes payable | 627,163 | 716,305 |
Net cash used in operating activities | (3,452,980) | (2,553,026) |
INVESTING ACTIVITIES: | ||
Proceeds from notes receivable | 55,952 | 0 |
Payment on costs of patents | 0 | (11,461) |
Cash paid to purchase a business (net of cash acquired) | 96,466 | 0 |
Purchase of a technology license | 0 | (40,000) |
Proceeds from disposal of equipment | 6,000 | 0 |
Purchase of equipment | (1,807,140) | (2,260,458) |
Net cash used in investing activities | (1,648,722) | (2,311,919) |
FINANCING ACTIVITIES: | ||
Finance lease liabilities | (160,650) | 0 |
Payment of long-term debt | 0 | (7,735) |
Proceeds from loans and notes payable | 3,177,622 | 8,033,407 |
Proceeds from sale of common stock | 6,240,000 | 0 |
Payment of notes payable | (534,111) | (374,065) |
Distributions to noncontrolling interest | (593,087) | 0 |
Net cash provided by financing activities | 8,129,774 | 7,651,607 |
Net increase (decrease) in cash and cash equivalents | 3,028,072 | 2,786,662 |
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 1,493,719 | 398,904 |
CASH AND CASH EQUIVALENTS, END OF PERIOD | 4,521,791 | 3,185,566 |
Cash paid during the year for: | ||
Interest | 480,605 | 204,713 |
Income taxes | 0 | 0 |
Noncash transactions: | ||
Conversion of Series A, B, B-1, and C-1 Preferred Stock to Common Stock | 1,200,000 | 9,467,604 |
Common stock issued for a reduction in liabilities | 1,144,992 | 374,802 |
Accounts payable on purchase of equipment | 586,717 | 0 |
Conversion of note receivable to equity investment | 0 | 81,768 |
Noncontrolling interest issued for a reduction in liabilities | 3,400,000 | 2,720,001 |
Preferred stock Series C-1 issued for a reduction in liabilities | 0 | 64,950 |
Common stock issued for the purchase of a license | 0 | 225,000 |
Capitalized interest on construction in process | $ 499,537 | $ 1,234,801 |
Dividend paid in Series B-1 Preferred Stock | 0 | 42,196 |
Common stock issued in the acquisition of Silver Fuels Delhi, LLC and White Claw Colorado City, LLC | $ 4,287,655 | $ 0 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Note 1. Basis of Presentation On February 14, 2022, we effected a 1-for-30 reverse split COVID-19 On March 11, 2020, the World Health Organization (“WHO”) declared the COVID-19 outbreak to be a global pandemic. In addition to the devastating effects on human life, the pandemic is having a negative ripple effect on the global economy, leading to disruptions and volatility in the global financial markets. Most U.S. states and many countries have issued policies intended to stop or slow the further spread of the disease. COVID-19 and the U.S. response to the pandemic are significantly affecting the economy. There are no comparable events that provide guidance as to the effect the COVID-19 pandemic may have, and, as a result, the ultimate effect of the pandemic is highly uncertain and subject to change. We do not yet know the full extent of the effects on the economy, the markets we serve, our business, or our operations. In March 2020 we temporarily suspended operations in Kuwait and Utah due to COVID-19 government restrictions, Utah has resumed operations in full. Kuwait has allowed for the Company to obtain site personnel visas to recommence operations. We have experienced supply chain disruptions in building our Remediation Processing Centers (“RPC”) and completing certain refurbishment on our precious metal extraction machines. These suspensions have had a negative impact on our business and there can be no guaranty that we will not need to suspend operations again in the future as a result of the pandemic. Interim Financial Information The accompanying unaudited condensed consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and disclosures normally included in consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. Accordingly, these condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the related notes for the year ended December 31, 2021. The unaudited condensed consolidated financial statements have been prepared on a basis consistent with that used to prepare the audited annual consolidated financial statements and include, in the opinion of management, all adjustments, consisting of normal and recurring items, necessary for the fair presentation of the condensed consolidated financial statements. The operating results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results expected for the full year ending December 31, 2022. Principles of Consolidation On August 1, 2022, we closed a Membership Interest Purchase Agreement, (the “MIPA”), with 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 Silver Fuels Delhi, LLC, a Louisiana limited liability company (“SFD”) and White Claw Colorado City, LLC, a Texas limited liability company (“WCCC”) whereby, the Company acquired all of the issued and outstanding membership interests in each of SFD and WCCC (the “Membership Interests”), making SFD and WCCC wholly owned subsidiaries of the Company. The Company has incorporated Vivaventures Remediation Corporation, a Texas corporation, which is a wholly owned subsidiary of the Company. The Company has incorporated this entity to direct its anticipated operations in Texas. The Company follows ASC 810-10-15 guidance with respect to accounting for Variable Interest Entities (“VIE”). A VIE is an entity that does not have sufficient equity at risk to finance its activities without additional subordinated financial support from other parties, or whose equity investors lack any of the characteristics of a controlling financial interest. A variable interest is an investment or other interest that will absorb portions of a VIE’s expected losses or receive portions of the entity’s expected residual returns. For the nine months ended September 30, 2022 and year ended December 31, 2021 the following entities are considered to be a VIE and are consolidated in our consolidated financial statements: Viva Wealth Fund I, LLC and RPC Design and Manufacturing, LLC. For the nine months ended September 30, 2022 and year ended December 31, 2021 the following entities were considered to be a VIE, but were not consolidated in our consolidated financial statements due to a lack of the power criterion or the losses/benefits criterion: Vivaventures UTS I, LLC, Vivaventures Royalty II, LLC, Vivaopportunity Fund, LLC, and International Metals Exchange, LLC. For the nine months ended September 30, 2022 and year ended December 31, 2021 the unaudited financial information for the unconsolidated VIEs is as follows: Vivaventures UTSI, LLC held assets of $ 3,345,351 3,753,296 47,049 12,608 3,146,973 2,648,810 1,720 300 2,119,826 2,119,961 8,755 no 29,780 30,461 1,900 Silver Fuels Delhi, LLC: 557,401 White Claw Colorado City, LLC: RPC Design and Manufacturing, LLC: 303,451 629,694 851,318 354,566 Viva Wealth Fund I, LLC: 147,865 199,952 rd th th Business Combinations We apply the provisions of ASC 805, Business Combinations (ASC 805), in accounting for our acquisitions. ASC 805 requires that we evaluate whether a transaction pertains to an acquisition of assets, or to an acquisition of a business. A business is defined as an integrated set of assets and activities that is capable of being conducted and managed for the purpose of providing a return to investors. Asset acquisitions are accounted for by allocating the cost of the acquisition to the individual assets and liabilities assumed on a relative fair value basis; whereas the acquisition of a business requires us to recognize separately from goodwill the assets acquired and the liabilities assumed at the acquisition date fair values. Goodwill as of the business acquisition date is measured as the excess of consideration transferred over the net of the acquisition date fair values of the assets acquired and the liabilities assumed. While we use our best estimates and assumptions to accurately value assets acquired and liabilities assumed at the business acquisition date as well as any contingent consideration, where applicable, our estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the business acquisition date, we record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Upon the conclusion of a business acquisition’s measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to our consolidated statements of operations. In addition, uncertain tax positions and tax related valuation allowances assumed in a business combination are initially estimated as of the acquisition date. We reevaluate these items quarterly based upon facts and circumstances that existed as of the business acquisition date with any adjustments to our preliminary estimates being recorded to goodwill if identified within the measurement period. Subsequent to the measurement period or our final determination of the tax allowance’s or contingency’s estimated value, whichever comes first, changes to these uncertain tax positions and tax related valuation allowances will affect our provision for income taxes in our consolidated statement of operations and could have a material impact on our results of operations and financial position. Long Lived Assets The Company reviews the carrying values of its long-lived assets for possible impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the expected future cash flow from the use of the asset and its eventual disposition is less than the carrying amount of the asset, an impairment loss is recognized and measured using the fair value of the related asset. No impairment charges were incurred during the nine months ended September 30, 2022 or for the year ended December 31, 2021, as the Company was still in the early phases of our business plan and operating losses were expected in our early phases. On March 11, 2020, the World Health Organization (“WHO”) declared the COVID-19 outbreak to be a global pandemic. In addition to the devastating effects on human life, the pandemic is having a negative ripple effect on the global economy, leading to disruptions and volatility in the global financial markets. Most U.S. states and many countries have issued policies intended to stop or slow the further spread of the disease. We have observed supply chain disruptions from the COVID-19 pandemic that has contributed to delays in the completion of the manufacturing of our RPCs as well as certain refurbishments to our precious metal extraction machines, although we do not believe that these delays have constituted a triggering event for impairment of our assets. Our Kuwait operations were suspended to comply with the social distancing measures implemented in Kuwait, but in 2022 has allowed for the Company to obtain site personnel visas to recommence operations. Our Utah operations were temporarily suspended from March through May 2020, but have since resumed in full in its manufacturing of its RPCs, and construction and implementation of site and infrastructure preparations in anticipation of commencing operations in 2022. The Company has been in discussions for the potential sale of the precious metal extraction business and ammonia synthesis business, or certain assets of those businesses, including its equipment. The Company is exploring all options including operating the business, creating a joint venture to operate the business, or appraising the businesses or their assets for the potential sale for at least the Company’s carrying value. There can be no assurance that market conditions will not change or demand for the Company’s services will continue, which could result in impairment of long-lived assets in the future. Asset Retirement Obligations Under ASC 410-20, Asset Retirement and Environmental Obligations – Asset Retirement Obligations, which relates to accounting requirements for costs associated with legal obligations to retire tangible, long-lived assets, the Company records an Asset Retirement Obligation (“ARO”) at fair value in the period in which it is incurred by increasing the carrying amount of the related long-lived asset. In each subsequent period, liability is accreted over time towards the ultimate obligation amount and the capitalized costs are depreciated over the useful life of the related asset. The Company did not identify any significant or material cost after review; thus, no Intangible Assets and Goodwill: We account for intangible assets and goodwill in accordance with ASC 350 “Intangibles-Goodwill and Other” We assess our intangible assets in accordance with ASC 360 “ Property, Plant, and Equipment The Company performs its annual goodwill impairment test in the fourth quarter each year, and more frequently if facts and circumstances indicate such assets may be impaired, including significant declines in actual or future projected cash flows and significant deterioration of market conditions. The Company’s goodwill impairment assessment includes a qualitative assessment to determine whether it is more likely than not that the fair value of the goodwill is below its carrying value, each year, and more often if there are significant changes in business conditions that could result in impairment. When a quantitative analysis is considered necessary for the annual impairment analysis of goodwill, the Company develops an estimated fair value for the reporting unit considering three different approaches: 1) market value, using the Company’s stock price plus outstanding debt; 2) discounted cash flow analysis; and 3) multiple of earnings before interest, taxes, depreciation and amortization based upon relevant industry data. The estimated fair value of the reporting unit is then compared to its carrying amount, including goodwill. If the estimated fair value exceeds the carrying amount, goodwill is not considered impaired. If the carrying amount, including goodwill, exceeds its estimated fair value, any excess of the carrying value of goodwill of the reporting unit over its fair value is recorded as an impairment. The Company has determined there has not been an interim impairment trigger since acquisition on August 1, 2022. Contingent liabilities From time to time the Company may work with success based professional service providers, including securities counsel for private offerings, which may require contingent payments to be made based on the future offering fundraising and financial performance of the offering. In the event that an offering does not perform or is never consummated, the Company may still be required to pay a portion of the success fees for the services provided in preparing the offering. The fair value of the contingent payments would be estimated using the present value of management's projections of the financial results. Failure to correctly project the financial results of the offering or settlement of legal fees related to the offering could materially impact our results of operations and financial position. Advertising Expense Advertising costs are expensed as incurred. The Company did not incur advertising expense for the nine months ended September 30, 2022 and 2021. Net Income/Loss Per Share Basic net income (loss) per share is calculated by subtracting any preferred interest distributions from net income (loss), all divided by the weighted-average number of common shares outstanding for the period, without consideration for common stock equivalents. Diluted net income (loss) per common share is computed by dividing the net income (loss) by the weighted-average number of common share equivalents outstanding for the period determined using the treasury stock method if their effect is dilutive. Potential dilutive instruments as of September 30, 2022 and 2021 include the following: convertible notes payable convertible into approximately 14,560 177,617 none 666,667 2,006,251 183,333 133,333 466,667 80,000 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, judgments, and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. We believe our critical accounting estimates relate to the following: Recoverability of current and noncurrent assets, revenue recognition, stock-based compensation, income taxes, effective interest rates related to long-term debt, marketable securities, cost basis and equity method investments, lease assets and liabilities, equity method investments, valuation of stock used to acquire assets, derivatives, and fair values of the intangible assets and goodwill related to business combinations. While our estimates and assumptions are based on our knowledge of current events and actions we may undertake in the future, actual results may ultimately differ from these estimates and assumptions. Fair Value of Financial Instruments 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 adoption of ASC 820 did not have an impact on the Company’s financial position or operating results but did expand certain disclosures. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Additionally, ASC 820 requires the use of valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized below: Level 1: Applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. Level 2: Applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data. Level 3: Applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. The Company analyzes all financial instruments with features of both liabilities and equity under the Financial Accounting Standard Board’s (“FASB”) accounting standard for such instruments. Under this standard, financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The carrying amounts reported in the consolidated balance sheets for marketable securities are classified as Level 1 assets due to observable quoted prices for identical assets in active markets. The carrying amounts reported in the consolidated balance sheets for cash, prepaid expenses and other current assets, accounts payable and accrued expenses approximate their estimated fair market values based on the short-term maturity of these instruments. The recorded values of notes payable approximate their current fair values because of their nature, rates, and respective maturity dates or durations. Recent accounting pronouncements The FASB issued ASU No. 2021-08, Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, Revenue Recognition We adopted Accounting Standards Codification 606, Revenue from Contracts with Customers (“ASC 606”). Due to the business combination in which we acquired Silver Fuels Delhi, LLC and White Claw Colorado City, LLC, for the nine months ended September 30, 2022, approximately 97 Major Customers and Concentration of Credit Risk The Company has two major customers, which account for approximately 96 99 |
Liquidity
Liquidity | 9 Months Ended |
Sep. 30, 2022 | |
Liquidity | |
Liquidity | Note 2. Liquidity We have historically suffered net losses and cumulative negative cash flows from operations, and as of September 30, 2022, we had an accumulated deficit of approximately $42.8 million. As of September 30, 2022 we had cash of $ 4,521,791 1,600,000 8 million 2,892,319 |
Business Combination
Business Combination | 9 Months Ended |
Sep. 30, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Business Combination | Note 3. Business Combination On June 15, 2022, we entered into a Membership Interest Purchase Agreement (the “MIPA”), with Jorgan Development, LLC ("Jorgan") and JBAH Holdings, LLC (“JBAH” and, together with Jorgan, the “Sellers”), as the equity holders of Silver Fuels Delhi, LLC (“SFD”) and White Claw Colorado City, LLC (“WCCC”) whereby, at closing, which occurred on August 1, 2022, the Company acquired 100% of the issued and outstanding membership interests in each of SFD and WCCC (the “Membership Interests”), making SFD and WCCC wholly owned subsidiaries of the Company. The purchase price for the Membership Interests is approximately $32.9 million, after post-closing adjustments, paid for by the Company with a combination of shares of the issuance of 3,009,552 28,664,284 For the acquisition of Silver Fuels Delhi, LLC and White Claw Colorado City, LLC, the following table summarizes the acquisition date fair value of consideration paid, identifiable assets acquired and liabilities assumed: Schedule of business combination Common stock $ 4,287,655 Note payable to seller 28,664,284 Fair value of total consideration paid $ 32,951,939 Net assets acquired and liabilities assumed Assets acquired in business combination Current assets $ 6,573,359 Finance lease right-of-use assets (property, plant and equipment) 4,464,217 Other assets 546,834 Contract-based intangible assets 25,195,644 Total assets acquired $ 36,780,054 Liabilities assumed in business combination Current liabilities $ (7,054,734 ) Long term liabilities (3,335,409 ) Total liabilities acquired $ (10,390,143 ) Total net assets acquired $ 26,389,911 Goodwill $ 6,562,028 The value of goodwill represents SFD and WCCC’s ability to generate profitable operations going forward. Management estimated the provisional fair values of the intangible assets and goodwill at September 30, 2022. The measurement of assets acquired and liabilities assumed in the business combination is based on preliminary estimates made by management and subject to adjustment within twelve months. Management is performing a valuation study to calculate the fair value of the acquired intangible assets and goodwill, which it plans to complete within the one-year measurement period. The acquired contracts are amortized over the 9 year, 5 month life of the contracts. Business combination related costs were expensed as incurred and consisted of various advisory, legal, accounting, valuation and other professional fees totaling $174,592 for the nine months ended September 30, 2022. These costs are included in general and administrative expense in our consolidated statement of operations. Since the date of acquisition on August 1, 2022 through September 30, 2022 $11,738,062 of sales in aggregate is attributed to SFD and WCCC. The unaudited financial information in the table below summarizes the combined results of operations of the Company, SFD, and WCCC for the nine months ended September 30, 2022 2021, on a pro forma basis, as though the companies had been combined as of January 1, 2021. The pro forma earnings for the nine months ended September 30, 2022 and 2021, were adjusted to include intangible amortization expense of contracts acquired of $2,006,662, respectively. The pro forma earnings for the nine months ended September 30, 2022 and 2021, were adjusted to include interest expense on notes payable that were issued as consideration of $1,539,093 and $691,705, respectively. The $174,592 of acquisition-related expenses were excluded from the nine months ended September 30, 2022, and included in the nine months ended September 30, 2021, as if the acquisition occurred at January 1, 2021. The unaudited pro forma financial information does not purport to be indicative of the Company’s combined results of operations which would actually have been obtained had the acquisition taken place on January 1, 2021, nor should it be taken as indicative of future consolidated results of operations. Schedule of proforma information (Unaudited) Nine months ended September 30, Nine months ended September 30, 2022 2021 Total net sales $ 47,667,690 $ 23,835,514 Loss from operations (7,143,460 ) (4,018,231 ) Net loss (attributable to Vivakor, Inc.) $ (8,402,844 ) $ (4,670,569 ) Basic and diluted loss per share (0.55 ) (0.31 ) Weighted average shares outstanding 15,284,240 14,873,495 |
Accounts receivable
Accounts receivable | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Accounts receivable | Note 4. Accounts receivable Accounts receivable primarily relates to sales to trade accounts receivable of customers for crude oil. Differences between the amounts due from customers less an estimated allowance for doubtful accounts, if deemed necessary by management, and based on a review of all outstanding amounts on a monthly basis. Management determines the allowance for doubtful accounts, if any, by identifying troubled accounts and by using historical experience applied to an aging of accounts. As of September 30, 2022 no 33,000 1,186,803 33,602 |
Prepaid Expenses and Other Asse
Prepaid Expenses and Other Assets | 9 Months Ended |
Sep. 30, 2022 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Prepaid Expenses and Other Assets | Note 5. Prepaid Expenses and Other Assets As of September 30, 2022, our prepaid expenses mainly consist of prepaid insurances. As of September 30, 2022 our other assets mainly consist of various deposits with vendors, professional service agents, security deposits on office and warehouse leases, and security deposits on finance leases. As of September 30, 2022 and December 31, 2021 we had office and warehouse lease deposits in the amount of $ 61,676 73,245 130,000 14,288 579,034 |
Marketable Securities
Marketable Securities | 9 Months Ended |
Sep. 30, 2022 | |
Investments, Debt and Equity Securities [Abstract] | |
Marketable Securities | Note 6. Marketable Securities As of December 31, 2020, the Company owned 3,309,758 860,491 379,011 402,114 The Company has an investment of $ 881,768 826,376,882 81,768 26,376,882 87,044 1,074,290 1,389,014 661,101 850,985 1,818,029 2,231,218 As of September 30, 2022 and December 31, 2021, marketable securities were $ 2,892,319 2,231,218 1,074,290 2,481,175 661,101 1,253,100 |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2022 | |
Inventory Disclosure [Abstract] | |
Inventories | Note 7. Inventories As of September 30, 2022, inventories consist of crude oil and Fenix iron. The crude oil is related to our oil gathering facility in Delhi, Louisiana. The nano Fenix Iron are finished goods that have a 20-year shelf life and were acquired at cost for $ 192,000 |
Property and Equipment
Property and Equipment | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Note 8. Property and Equipment The following table sets forth the components of the Company’s property and equipment at September 30, 2022 and December 31, 2021: Schedule of property and equipment, net September 30, 2022 December 31, 2021 Gross Carrying Amount Accumulated Depreciation Net Book Value Gross Carrying Amount Accumulated Depreciation Net Book Value Office furniture and equipment $ 27,998 $ 5,434 $ 22,564 $ 14,998 $ 4,000 $ 10,998 Vehicles 36,432 24,288 12,144 48,248 26,306 21,942 Finance lease right-of-use assets 5,810,339 1,471,848 4,338,551 – – – Precious metal extraction machine- 1 ton 2,280,000 342,000 1,938,000 2,280,000 228,000 2,052,000 Precious metal extraction machine- 10 ton 5,320,000 798,000 4,522,000 5,320,000 532,000 4,788,000 Construction in process: Bioreactors 1,440,000 – 1,440,000 1,440,000 – 1,440,000 Nanosponge/Cavitation device 44,603 – 44,603 22,103 – 22,103 Remediation Processing Unit 1 6,116,013 – 6,116,013 6,249,082 – 6,249,082 Remediation Processing Unit 2 5,714,894 – 5,714,894 5,201,098 – 5,201,098 Remediation Processing Unit System A 3,739,637 – 3,739,637 2,561,467 – 2,561,467 Remediation Processing Unit System B 3,657,420 – 3,657,420 2,345,421 – 2,345,421 Total fixed assets $ 34,187,396 $ 2,641,570 $ 31,545,826 $ 25,482,417 $ 790,306 $ 24,692,111 For the year ended December 31, 2021 the Company issued 5,413 64,950 500,352 8,671 499,537 1,234,801 |
Intellectual Property, Net and
Intellectual Property, Net and Goodwill | 9 Months Ended |
Sep. 30, 2022 | |
Intellectual Property Net And Goodwill | |
Intellectual Property, Net and Goodwill | Note 9. Intellectual Property, Net and Goodwill The following table sets forth the components of the Company’s intellectual property at September 30, 2022 and December 31, 2021: Schedule of components of intellectual property September 30, 2022 December 31, 2021 Gross Carrying Amount Accumulated Amortization Net Book Value Gross Carrying Amount Accumulated Amortization Net Book Value Extraction Technology patents $ 113,430 $ 10,565 $ 102,865 $ 113,430 $ 5,560 $ 107,870 Extraction Technology 16,385,157 6,280,977 10,104,180 16,385,157 5,666,534 10,718,623 Acquired crude oil contracts 25,195,644 445,925 24,749,719 – – – Ammonia synthesis patents 4,931,380 2,465,690 2,465,690 4,931,380 2,095,836 2,835,544 Total Intellectual property $ 46,625,611 $ 9,203,157 $ 37,422,454 $ 21,429,967 $ 7,767,930 $ 13,662,037 The changes in the carrying amount of goodwill are as follows: Schedule of goodwill Goodwill January 1, 2021 $ – Acquisition 6,562,028 September 30, 2022 $ 6,562,028 On August 1, 2022, the Company closed a Membership Interest Purchase Agreement, (the “MIPA”), with Jorgan Development, LLC, and JBAH Holdings, LLC, as the equity holders of Silver Fuels Delhi, LLC, a Louisiana limited liability company ("SFD") and White Claw Colorado City, LLC, a Texas limited liability company (“WCCC”) whereby, the Company acquired all of the issued and outstanding membership interests in each of SFD and WCCC making SFD and WCCC wholly owned subsidiaries of the Company. The purchase price for the Membership Interests is approximately $ 32.9 million In the business combination of acquiring WCCC we also acquired WCCC’s Oil Storage Agreement with White Claw Crude, LLC (“WC Crude”), who shares a beneficiary, James Ballengee, with Jorgan and JBAH, whom in aggregate now hold approximately 16% of our common stock. Under this agreement, WC Crude has the right, subject to the payment of service and maintenance fees, to store volumes of crude oil and other liquid hydrocarbons at a certain crude oil terminal operated by WCCC. WC Crude is required to pay $150,000 per month even if the storage space is not used. The agreement expires on December 31, 2031. In the business combination of acquiring SFD, we acquired an amended Crude Petroleum Supply Agreement with WC Crude (the “Supply Agreement”), under which WC Crude supplies volumes of Crude Petroleum to SFD, which provides for the delivery to SFD a minimum of 1,000 sourced barrels per day, and includes a guarantee that when SFD resells these barrels, if SFD does not make at least a $5.00 per barrel margin on the oil purchased from WC Crude, then WC Crude will pay to SFD the difference between the sales price and $5.00 per barrel. In the event that SFD makes more than $5.00 per barrel, SFD will pay WC Crude a profit-sharing payment in the amount equal to 10% of the excess price over $5.00 per barrel, which amount will be multiplied by the number of barrels associated with the sale. The Supply Agreement expires on December 31, 2031. The measurement of assets acquired and liabilities assumed in the business combination is based on preliminary estimates made by management and subject to adjustment within twelve months. Management estimated the provisional fair values of the intangible assets and goodwill at September 30, 2022. Management is performing a valuation study to calculate the fair value of the acquired intangible assets and goodwill, which it plans to complete within the one-year measurement period. Management has estimated the provisional fair values of goodwill and the acquired contracts (described above) to be $ 6,562,028 25,195,644 445,925 1,114,812 2,675,644 24,749,719 The Company has been in discussions for the potential sale of the ammonia synthesis business, or certain assets of that business, including its patents. The Company is exploring all options including operating the business, creating a joint venture to operate the business, or appraising the businesses or their assets for the potential sale for at least the carrying value. |
Accounts Payable and Accrued Ex
Accounts Payable and Accrued Expenses | 9 Months Ended |
Sep. 30, 2022 | |
Payables and Accruals [Abstract] | |
Accounts Payable and Accrued Expenses | Note 10. Accounts Payable and Accrued Expenses Accounts payable and accrued expenses consist of the following: Schedule of accounts payable and accrued expenses September 30, December 31, 2022 2021 Accounts payable $ 6,524,550 $ 1,450,531 Office access deposits 340 340 Accrued compensation 603,207 175,000 Unearned revenue 41,871 – Accrued interest (various notes and loans payable 335,559 – Accrued interest (working interest royalty programs) 1,562,160 – Accrued tax penalties and interest 405,314 398,114 Accounts payable and accrued expenses $ 9,473,001 $ 2,023,985 As of September 30, 2022, our accounts payable are primarily made up of . 3,731,888 As of December 31, 2021 the Company accrued $225,000 for a milestone payment to be paid to |
Loans and Notes Payable
Loans and Notes Payable | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Loans and Notes Payable | Note 11. Loans and Notes Payable Loans and Notes payable consist of the following: Schedule of loans and notes payable September 30, December 31, 2022 2021 Various promissory notes and convertible notes $ 50,960 $ 50,960 Novus Capital Group LLC Note (a) 281,268 378,854 Triple T Notes 337,044 353,330 National Buick GMC 16,977 19,440 Various Convertible Bridge Notes (b) – 1,075,813 Blue Ridge Bank 410,200 410,200 Small Business Administration 299,900 318,175 JP Morgan Chase Bank 90,645 90,645 JBAH Holdings, LLC (c) 286,643 – Jorgan Development, LLC (c) 28,377,641 – Various Promissory Notes (d) 2,794,500 3,416,379 Total Notes Payable $ 32,945,778 $ 6,113,796 Loans and notes payable, current $ 971,441 $ 1,511,447 Loans and notes payable, current attributed to variable interest entity $ 2,597,709 $ 3,416,379 Loans and notes payable, long term $ 29,376,628 $ 1,185,970 Schedule of maturities of loans and notes payable 2022 $ 2,461,420 2023 1,980,382 2024 16,756,429 2025 11,392,317 2026 124,285 Thereafter 230,945 Total $ 32,945,778 __________________ (a) On September 5, 2017, the Company acquired patents in the amount of $4,931,380 in which the Company also agreed to assume the encumbering debt on asset in the amount of $334,775 due in December 2019 with no interest accruing until 2020 and a deferred tax liability of $1,043,398. As of April 1, 2022, the lender agreed to extend the maturity of the note to April 1, 2023 with an initial payment of $52,448 and approximate monthly payment of $29,432 thereafter until the note is fully paid. (b) In 2021 and 2020 the Company entered into various convertible promissory notes as follows: Throughout 2021 and 2020 the Company entered into convertible promissory notes with an aggregate principal of $415,000. The notes accrue interest at 10% per annum and have a maturity of the earlier of 12 months or the consummation of the Company listing its Common Stock on a senior stock exchange. The notes are convertible at the Company’s option into shares of the Company’s common stock at a price equal to 80% of the opening price of the Company’s common stock on the national exchange or the offering price paid by the investors in the financing in connection with the uplist, whichever is lower, or (ii) repaid in cash in an amount equal to the indebtedness being repaid plus a premium payment equal to 15% of the amount being repaid. If an event of default has occurred and the Company does not convert the amounts due under the Note into the Company’s common stock, then the Company will have the option to convert the outstanding indebtedness into shares of the Company’s common stock at a price equal to 80% of the weighted average trading price of the Company’s common stock on the OTC Markets, or be repaid in cash in an amount equal to all principal and interest due under the Note. All of these notes were converted to common stock as of September 30, 2022. On October 13, 2020, the Company entered into a convertible promissory note in an amount of $280,500 having an interest rate of 12% per annum. The note bears a 10% Original Issue Discount. The loan shall mature in 1 year and may be convertible at the lower of $12.00 or 80% of the lowest median daily traded price over ten trading days prior to conversion, but in the event of a Qualified Uplist the note may be converted at a 30% discount to market. The Company also issued 3,333 restricted shares with no registration rights in conjunction with this note, which was recorded as a debt discount in the amount of $44,000, which is amortized to interest expense over the term of the agreements using the effective interest method. On March 28, 2021 the parties amended this agreement to state that in no event shall the conversion price be lower than $3.00 per share. In October 2021 the parties agreed to extend the maturity of this loan to April 13, 2022 in exchange for an increase in principal owed of $30,000. This note has been converted to common stock as of September 30, 2022. On February 4, 2021, the Company entered into a convertible promissory note in an amount of $277,778 having an interest rate of 12% per annum. The note bears a 10% Original Issue Discount. The loan shall mature in 1 year and may be convertible at the lower of $12.00 or 80% of the lowest median daily traded price over ten trading days prior to conversion, but in the event of a Qualified Uplist the note may be converted at a 30% discount to market. The Company also issued 3,333 restricted shares with no registration rights in conjunction with this note, which was recorded as a debt discount in the amount of $36,000, which is amortized to interest expense over the term of the agreements using the effective interest method. On March 28, 2021 the parties amended this agreement to state that in no event shall the conversion price be lower than $3.00 per share. In February 2022 the parties agreed to extend the maturity of this loan to August 8, 2022 in exchange for an increase in principal owed of $25,000. This note has been converted to common stock as of September 30, 2022. (c) On August 1, 2022, we closed a Membership Interest Purchase Agreement, (the “MIPA”), with Jorgan Development, LLC, ("Jorgan") and JBAH Holdings, LLC (“JBAH”), as the equity holders of Silver Fuels Delhi, LLC ("SFD") and White Claw Colorado City, LLC ("WCCC" ) whereby, the Company acquired all of the issued and outstanding membership interests in each of SFD and WCCC, making SFD and WCCC wholly owned subsidiaries of the Company. The consideration for the membership interests included secured three-year promissory notes in the amount of $286,643 to JBAH and $28,377,641 to Jorgan, which accrue interest of prime plus 3% on the outstanding balance of the notes. Under the MIPA, the Company has committed to make a payment to Jorgan and JBAH on or before February 1, 2024 in the amounts of $16,306,754 to Jorgan and $164,715 to JBAH, whether in cash or unrestricted common stock. In the event of a breach of the terms of the notes, the sole and exclusive remedy of the holder of the notes will be to unwind the MIPA transaction. The principal amount of the notes, together with any and all accrued and unpaid interest thereon, will be paid to on a monthly basis in an amount equal to the Monthly Free Cash Flow continuing thereafter on the twentieth (20 th (d) The balance of these various promissory notes are related to the special purchase vehicle, Viva Wealth Fund I, LLC (VWFI) of which the balance primarily related to an offering up to $25,000,000 in convertible notes in a private offering. As of September 30, 2022, VWFI has raised $11,125,000 and converted $8,950,000 of this debt to VWFI LLC units. A convertible note will automatically convert into the LLC units at the earlier of (i) the date that the Equipment is placed into quality control and testing or (ii) six months from the date of investment. The convertible notes will accrue interest at 12% per annum and are paid quarterly. At the maturity date, remaining interest will be paid, at which time no further interest payments will accrue. Upon the offering termination date, all units accepted for any series of equipment will automatically convert to Vivakor common stock if the Company has not accepted subscriptions for at least $6,250,000 for a series of equipment. The conversion price of the automatic stock conversion will be the greater of $13.50 or a 10% discount to market per share or in the event of a public offering, 200% of the per share price of the Company common stock sold in an underwritten offering, which was closed on February 14, 2022 at $5.00 per share. The termination date of the offering has been extended until March 31, 2023 in the sole discretion of the Company. As of April 28, 2021 VWFI has reached $6,250,000 in funding and has released the funding for construction of RPC Series A. VWFI has commenced fundraising for RPC Series B, and as of September 30, 2022, VWFI has raised approximately $4,875,000 to manufacture RPC Series B as of September 30, 2022. Subsequent to September 30, 2022 an additional $290,000 has been raised in relation this offering, and $290,000 of this debt has been converted into units of the LLC. VWFI has also entered into various master revolving notes outside of the offering: $329,500, from a related party of VWFI, which accrues 6% interest per annum, has a maturity date of October 11, 2023, where no payments are made prior to the maturity date unless at the option of the fund; $300,000, from a related party of VWFI, which accrues 5% interest per annum, has a maturity date of July 14, 2024, where no payments are made prior to the maturity date unless at the option of the fund; $184,415, made up of two loans with the Company, which accrue between 3-5% interest per annum, have maturity dates of October 14, 2023 and April 20, 2024, where no payments are made prior to the maturity date unless at the option of the fund, and all principal and interest of these two loans is eliminated upon consolidation. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 12. Commitments and Contingencies Finance Leases In the business combination where we acquired Silver Fuels Delhi, LLC (SFD) and White Claw Colorado City, LLC (WCCC), we acquired certain finance leases contracts and liabilities as described below: On March 17, 2020, the SFD entered into two sale and leaseback transactions with Maxus Capital Group, LLC (“Maxus”). The first transaction involved the Company assigning twelve 400-barrel steel storage tanks, two truck offloading transfer meters and two pipeline transfer meters located in Richland Parish, Louisiana to Maxus for consideration of $ 1,025,000 22,100 1 1,350,861 18,912 877,519 We are required to make minimum cash reserve payments of at least $ 24,000 8,945 15,055 As of September 30, 2022, the balances of the cash reserves for these leases were $ 369,109 and $216,000, respectively. 12.39 10.36 123,063 492,145 492,145 82,024 On December 28, 2021, the WCCC entered into a sale and leaseback transaction with Maxus, where WCCC assigned the crude oil, natural gas liquids, condensate, and liquid hydrocarbon receipt, throughput, processing, gathering, and delivery terminal, commonly known as the China Grove Station (the “China Grove Station”), located in Colorado City, Texas to Maxus for consideration of $ 2,500,000 39,313 875,000 16,100 471,756 138,913 8.54 117,939 471,756 471,756 471,756 432,443 On December 28, 2021, WCCC incurred $ 82,400 2,746 The components of the finance lease cost from the date of acquisition on August 1, 2022 to September 30, 2022 is as follows: Finance lease cost Amortization of right of use asset $ 112,666 Interest on lease liabilities 66,481 Total lease cost $ 179,147 The aggregate finance lease liabilities as of September 30, 2022 was $ 3,875,360 The following table reconciles the undiscounted cash flows for the finance leases as of September 30, 2022 to the finance lease liability recorded on the balance sheet: Schedule of financing lease liability 2022 $ 240,975 2023 963,901 2024 963,901 2025 553,780 2026 432,443 Total undiscounted lease payments 3,155,000 Less: Imputed interest 962,598 Present value of lease payments 2,192,401 Add: carrying value of lease obligation at end of lease term 1,753,000 Present value of lease payments 2,192,401 Total finance lease obligations 3,945,401 Less: Unamortized financing fees 70,041 Total lease obligations, net $ 3,875,360 Finance lease liabilities, current $ 652,440 Finance lease liabilities, long-term $ 3,222,920 Weighted-average remaining lease term 3.47 Weighted-average discount rate 9.93 Operating Leases Commencing on September 15, 2019, the Company entered into a five-year lease with Jamboree Center 1 & 2 LLC covering approximately 6,961 square feet of office space in Irvine, CA. Under the terms of the lease agreement, we are required to make the following monthly lease payments: Year 1 $ 21,927 22,832 23,737 24,712 25,686 51,992 On February 1, 2022, the Company entered into a lease agreement for approximately 2,533 square feet of office and manufacturing space located in Las Vegas, Nevada. Commencing on March 1, 2022, the Company entered into a three-year lease with Speedway Commerce Center, LLC. Under the terms of the lease agreement, we are required to make the following monthly lease payments: Year 1 $ 1,950 2,028 2,110 2,418 On March 28, 2022, the Company entered into a lease agreement for approximately 1,469 square feet of office space located in Lehi, Utah. Commencing on April 1, 2022, the Company entered into a three-year lease with Victory Holdings, LLC. Under the terms of the lease agreement, we are required to make the following monthly lease payments: Year 1 is comprised of April to May 2022 $ 867 3,550 3,657 3,766 3,766 On April 1, 2022, the Company entered into a lease agreement for approximately 2,000 square feet of office and warehouse space located in Houston, Texas. Commencing on April 1, 2022, the Company entered into a month-to-month lease with JVS Holdings, Inc. The lease may be terminated at any time or for any reason with a 30-day written notice to terminate. The lease requires a monthly lease payment of $ 2,000 The right-of-use asset for operating leases as of September 30, 2022 and December 31, 2021 was $ 648,201 663,291 294,382 246,526 The following table reconciles the undiscounted cash flows for the leases as of September 30, 2022 to the operating lease liability recorded on the balance sheet: Schedule of lessee operating lease liability 2022 $ 91,560 2023 370,902 2024 304,892 2025 16,135 Total undiscounted lease payments 783,489 Less: Imputed interest 80,854 Present value of lease payments $ 702,635 Operating lease liabilities, current $ 364,103 Operating lease liabilities, long-term $ 338,531 Weighted-average remaining lease term 2.11 Weighted-average discount rate 7.00 The discount rate is the Company’s incremental borrowing rate, or the rate of interest that the Company would have to pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. Based on an assessment of the Company’s borrowings at the time the operating leases were entered into, the incremental borrowing rate was determined to be 7%. Employment Agreements On September 30, 2022, the Board of Directors of the Company received notice from Matthew Nicosia, the Company’s Chief Executive Officer and Chairman of the Board of Directors of his resignation from such positions. Such resignations are not the result of any disagreement with the Company on any matter relating to the Company’s operations, policies or practices and the resignation is considered to be without good reason. On October 28, 2022 we entered into an executive employment agreement with a new Chief Executive Officer (see Note 19). In June 2022, the Company entered into employment agreements with its previous Chief Executive Officer and its current Chief Financial Officer, which provided for annual base salaries of $375,000 and $350,000, respectively, and provided for incremental increases in their salaries upon the Company’s achievement of specific performance metrics. The Company is currently accruing substantial portions of executive base salaries (see Note 10). The employment agreements provided for the grant of stock options to the previous Chief Executive Officer and the current Chief Financial Officer to purchase up to 955,093 and 917,825 shares of the Company’s common stock, respectively, at an exercise price equal to 110% and 100% of the fair market value of the Company’s common stock on the date of grant. The previous Chief Executive Officer vested in 503,935 Contingent liabilities From time to time the Company may work with success based professional service providers, including securities counsel for private offerings, which may require contingent payments to be made based on the future offering fundraising and financial performance of the offering. In the event that an offering does not perform or is never consummated, the Company may still be required to pay a portion of the success fees for the services provided in preparing the offering. The fair value of the contingent payments would be estimated using the present value of management's projections of the financial results. Failure to correctly project the financial results of the offering or settlement of legal fees related to the offering could materially impact our results of operations and financial position. |
Long-term Debt
Long-term Debt | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Long-term Debt | Note 13. Long-term Debt To assist in funding the manufacture of the Company’s Remediation Processing Centers, between 2015 and 2017, the Company entered into two agreements which include terms for the purchase of participation rights for the sale of future revenue of the funded RPCs. The RPCs are estimated to enter scaled up operations in 2023 and make estimated payments. The Company estimates future payments based on revenue projections for the RPCs. Due to delays in scaled up operations (see Note 1 Long Lived Assets Long-term debt consists of the following: Schedule Of Long-Term Debt 2022 2021 Principal $ 2,196,233 $ 2,196,233 Accrued interest 2,997,529 4,205,144 Debt discount (215,659 ) (226,823 ) Total long term debt $ 4,978,103 $ 6,174,554 Long term debt, current $ 9,363 $ 3,256 Long term debt $ 4,968,740 $ 6,171,298 The following table sets forth the estimated payment schedule of long-term debt as of September 30, 2022: Schedule of long-term debt maturities 2022 $ 950 2023 11,598 2024 15,002 2025 19,409 2026 25,114 Thereafter 2,124,160 Total $ 2,196,233 |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
Stockholders' Equity | Note 14. Stockholders' Equity On August 1, 2022, we closed a Membership Interest Purchase Agreement, (the “MIPA”), with Jorgan Development, LLC, (“Jorgan”) and JBAH Holdings, LLC, ("JBAH"), as the equity holders of Silver Fuels Delhi, LLC (“SFD”) and White Claw Colorado City, LLC (“WCCC”), whereby, the Company acquired all of the issued and outstanding membership interests in each of SFD and WCCC, making SFD and WCCC wholly owned subsidiaries of the Company. The purchase price for the Membership Interests is approximately $ 32.9 million 3,009,552 19.99 3,009,552 |
Temporary Equity
Temporary Equity | 9 Months Ended |
Sep. 30, 2022 | |
Temporary Equity | |
Temporary Equity | Note 15. Temporary Equity All Series B, B-1, and C-1 Preferred Stock was converted to Common Stock as of June 30, 2021. There was no activity for Series B, B-1, and C-1 Preferred Stock, which remain at a zero balance, for the three months ended September 30, 2021. Schedule of temporary equity Convertible Preferred Stock Series B Series B-1 Series C-1 Shares Amount Shares Amount Shares Amount December 31, 2020 216,916 $ 1,301,500 467,728 $ 3,507,981 255,289 $ 4,550,977 Series C-1 Issue for a reduction in stock payables – – – – 5,413 64,950 Dividend paid in Series B-1 Preferred Stock – – – – 5,626 – Conversion of Series B and B-1 Preferred Stock to Common Stock (216,916 ) (1,301,500 ) (467,728 ) (3,507,981 ) (266,328 ) (4,615,927 ) September 30, 2021 – $ – – $ – – $ – During the year ended December 31, 2021, all shares of Series B, B-1, and C-1 Preferred Stock were converted to common stock. |
Noncontrolling Interest
Noncontrolling Interest | 9 Months Ended |
Sep. 30, 2022 | |
Noncontrolling Interest [Abstract] | |
Noncontrolling Interest | Note 16. Noncontrolling Interest For the nine months ended September 30, 2022 and 2021, the Company converted $ 3,400,000 2,720,000 680 544 For the nine months ended September 30, 2022 and 2021, the Company paid distributions to Viva Wealth Fund I, LLC unit holders of $ 593,087 none |
Share-Based Compensation & Warr
Share-Based Compensation & Warrants | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
Share-Based Compensation & Warrants | Note 17. Share-Based Compensation & Warrants Options Generally accepted accounting principles require share-based payments to employees, including grants of employee stock options, warrants, and common stock to be recognized in the income statement based on their fair values at the date of grant, net of estimated forfeitures. As of September 30, 2022 and December 31, 2021, the Company has granted stock-based compensation to employees, including a 16,667 166,667 1,872,918 451,158 2,185,615 334,584 133,333 333,334 1,172,500 1,157,500 240,000 There were no other options granted during the nine months ended September 30, 2022 and 2021, respectively. The assumptions used in the Black-Scholes option pricing model to determine the fair value of the options on the date of issuance are as follows: Schedule of warrant assumptions December 31, 2020 through September 30, 2022 Risk-free interest rate 0.24 3.04 Expected dividend yield None Expected life of warrants 3.33 10 Expected volatility rate 169 273 The following table summarizes all stock option activity of the Company for the nine months ended September 30, 2022 and 2021: Schedule of option activity Weighted Weighted Average Average Remaining Number Exercise Contractual of Shares Price Life (Years) Outstanding, December 31, 2021 650,000 $ 12.00 7.53 Granted 2,112,919 2.24 6.60 Exercised (16,667 ) 11.10 – Forfeited/canceled (740,000 ) 10.00 – Outstanding, September 30, 2022 2,006,251 $ 2.56 6.93 Exercisable, December 31, 2021 180,000 $ 12.00 7.01 Exercisable, September 30, 2022 1,175,059 $ 2.67 7.09 Outstanding, December 31, 2020 650,000 $ 12.00 8.53 Outstanding, September 30, 2021 650,000 $ 12.00 7.78 Exercisable, December 31, 2020 47,083 $ 12.00 6.27 Exercisable, September 30, 2021 144,167 $ 12.00 7.01 As of September 30, 2022 and December 31, 2021, the aggregate intrinsic value of the Company’s outstanding options was approximately none. The aggregate intrinsic value will change based on the fair market value of the Company’s common stock. Warrants As of September 30, 2022 and December 31, 2021, the Company had 80,000 no 1,600,000 80,000 5.75 |
Income Tax
Income Tax | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Tax | Note 18. Income Tax The Company calculates its quarterly tax provision pursuant to the guidelines in ASC 740 Income Taxes. ASC 740 requires companies to estimate the annual effective tax rate for current year ordinary income. In calculating the effective tax rate, permanent differences between financial reporting and taxable income are factored into the calculation, and temporary differences are not. The estimated annual effective tax rate represents the Company’s estimate of the tax provision in relation to the best estimate of pre-tax ordinary income or loss. The estimated annual effective tax rate is then applied to year-to-date ordinary income or loss to calculate the year-to-date interim tax provision. The Company recorded a provision for income taxes of $ 800 none 9.18 As of December 31, 2021, the Company had estimated federal and state net operating loss (NOL) carryforwards of approximately $ 14.3 |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 19. Subsequent Events The Company has evaluated subsequent events through the date the financial statements were available to issue. On October 24, 2022, the Board of Directors resolved to increase their compensation to (i) $50,000 per year in cash effective August 1, 2022, in equal quarterly payments, with the first such payment, in the amount of $12,500 due November 1, 2022 and, thereafter, $12,500 every February 1, May 1, August 1 and November 1, and (ii) 100,000 stock options priced at $2.50 per share, vesting immediately. In addition, the Board of Directors approved a one-time payment of $10,000 to each Mr. Trent Staggs and Mr. Al Ferrara for serving as the Chairperson of the Compensation Committee and Chairperson of the Audit Committee of the Board of Directors, respectively, payable on November 1, 2022. On October 28, 2022, we entered into an executive employment agreement with James Ballengee (the “Employment Agreement”) with respect to the Company’s appointment of Mr. Ballengee as Chief Executive Officer and Chairman of the Board of Directors (the “Board”). Pursuant to the Employment Agreement, Mr. Ballengee will receive annual compensation of $1,000,000 payable in shares of the Company’s common stock, issued in four equal quarterly installments, priced at the volume weighted average price (VWAP) for the five trading days preceding the date of the Employment Agreement and each anniversary thereof (the “CEO Compensation”). The CEO Compensation shall be subject to satisfaction of Nasdaq rules, the provisions of the Company’s equity incentive plan and other applicable requirements and shall be accrued if such issuance is due prior to satisfaction of such requirements. Additionally, Mr. Ballengee shall be eligible for a discretionary performance bonus. The Employment Agreement may be terminated by either party for any or no reason, by providing a five days’ notice of termination. Pursuant to the Employment Agreement, Mr. Ballengee is granted the right to nominate two additional directors for appointment to the Board in his sole discretion, as well as a third additional director upon issuance of the Note Payment Shares (defined below), subject to such directors passing a background check. On October 28, 2022, in connection with the Employment Agreement, the Company and Jorgan and JBAH entered into an agreement amending the notes issued as consideration in the MIPA (the “Note Amendment”), whereby, as soon as is practicable, following and subject to the approval of the Company’s shareholders, and provided there are no applicable prohibitions under the rules of The Nasdaq Capital Market or other restrictions, the Company will issue 7,042,254 restricted shares of the Company’s common stock (the “Note Payment Shares”) as a payment of $10,000,000 toward the principal of the notes on a pro rata basis, reflecting a conversion price of $1.42 per share (the “Note Payment”). 6,971,831 shares will be issued to Jorgan and $9,900,000 of principal owed to Jorgan will be cancelled, and 70,423 shares will be issued to JBAH and $100,000 of principal owed to JBAH will be cancelled. Once the registration statement is declared effective by the SEC, the Note Payment will count against the Threshold Payment Amount, as defined in the notes and the MIPA. As of October 28, 2022, and in connection with Mr. Ballengee’s appointment as Chief Executive Officer, the following parties, of whom Mr. Ballengee is a beneficiary of, will be disclosed as related parties: Jorgan (MIPA note payable), JBAH (MIPA note payable), WC Crude (oil supply agreement and oil storage agreement, both acquired in the business combinations closed August 1, 2022), Endeavor Crude, LLC (shared services agreement acquired in the business combination closed on August 1, 2022). Subsequent to September 30, 2022, VWFI has raised $290,000 in conjunction with the $25,000,000 private placement offering to sell convertible promissory notes, which convert to VWFI LLC units, to accredited investors to raise funds to manufacture equipment that manufacture RPC Series B. Subsequent to September 30, 2022, VWFI has also converted $290,000 of convertible debt into VWFI LLC units. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
COVID-19 | COVID-19 On March 11, 2020, the World Health Organization (“WHO”) declared the COVID-19 outbreak to be a global pandemic. In addition to the devastating effects on human life, the pandemic is having a negative ripple effect on the global economy, leading to disruptions and volatility in the global financial markets. Most U.S. states and many countries have issued policies intended to stop or slow the further spread of the disease. COVID-19 and the U.S. response to the pandemic are significantly affecting the economy. There are no comparable events that provide guidance as to the effect the COVID-19 pandemic may have, and, as a result, the ultimate effect of the pandemic is highly uncertain and subject to change. We do not yet know the full extent of the effects on the economy, the markets we serve, our business, or our operations. In March 2020 we temporarily suspended operations in Kuwait and Utah due to COVID-19 government restrictions, Utah has resumed operations in full. Kuwait has allowed for the Company to obtain site personnel visas to recommence operations. We have experienced supply chain disruptions in building our Remediation Processing Centers (“RPC”) and completing certain refurbishment on our precious metal extraction machines. These suspensions have had a negative impact on our business and there can be no guaranty that we will not need to suspend operations again in the future as a result of the pandemic. |
Interim Financial Information | Interim Financial Information The accompanying unaudited condensed consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and disclosures normally included in consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. Accordingly, these condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the related notes for the year ended December 31, 2021. The unaudited condensed consolidated financial statements have been prepared on a basis consistent with that used to prepare the audited annual consolidated financial statements and include, in the opinion of management, all adjustments, consisting of normal and recurring items, necessary for the fair presentation of the condensed consolidated financial statements. The operating results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results expected for the full year ending December 31, 2022. |
Principles of Consolidation | Principles of Consolidation On August 1, 2022, we closed a Membership Interest Purchase Agreement, (the “MIPA”), with 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 Silver Fuels Delhi, LLC, a Louisiana limited liability company (“SFD”) and White Claw Colorado City, LLC, a Texas limited liability company (“WCCC”) whereby, the Company acquired all of the issued and outstanding membership interests in each of SFD and WCCC (the “Membership Interests”), making SFD and WCCC wholly owned subsidiaries of the Company. The Company has incorporated Vivaventures Remediation Corporation, a Texas corporation, which is a wholly owned subsidiary of the Company. The Company has incorporated this entity to direct its anticipated operations in Texas. The Company follows ASC 810-10-15 guidance with respect to accounting for Variable Interest Entities (“VIE”). A VIE is an entity that does not have sufficient equity at risk to finance its activities without additional subordinated financial support from other parties, or whose equity investors lack any of the characteristics of a controlling financial interest. A variable interest is an investment or other interest that will absorb portions of a VIE’s expected losses or receive portions of the entity’s expected residual returns. For the nine months ended September 30, 2022 and year ended December 31, 2021 the following entities are considered to be a VIE and are consolidated in our consolidated financial statements: Viva Wealth Fund I, LLC and RPC Design and Manufacturing, LLC. For the nine months ended September 30, 2022 and year ended December 31, 2021 the following entities were considered to be a VIE, but were not consolidated in our consolidated financial statements due to a lack of the power criterion or the losses/benefits criterion: Vivaventures UTS I, LLC, Vivaventures Royalty II, LLC, Vivaopportunity Fund, LLC, and International Metals Exchange, LLC. For the nine months ended September 30, 2022 and year ended December 31, 2021 the unaudited financial information for the unconsolidated VIEs is as follows: Vivaventures UTSI, LLC held assets of $ 3,345,351 3,753,296 47,049 12,608 3,146,973 2,648,810 1,720 300 2,119,826 2,119,961 8,755 no 29,780 30,461 1,900 Silver Fuels Delhi, LLC: 557,401 White Claw Colorado City, LLC: RPC Design and Manufacturing, LLC: 303,451 629,694 851,318 354,566 Viva Wealth Fund I, LLC: 147,865 199,952 rd th th |
Business Combinations | Business Combinations We apply the provisions of ASC 805, Business Combinations (ASC 805), in accounting for our acquisitions. ASC 805 requires that we evaluate whether a transaction pertains to an acquisition of assets, or to an acquisition of a business. A business is defined as an integrated set of assets and activities that is capable of being conducted and managed for the purpose of providing a return to investors. Asset acquisitions are accounted for by allocating the cost of the acquisition to the individual assets and liabilities assumed on a relative fair value basis; whereas the acquisition of a business requires us to recognize separately from goodwill the assets acquired and the liabilities assumed at the acquisition date fair values. Goodwill as of the business acquisition date is measured as the excess of consideration transferred over the net of the acquisition date fair values of the assets acquired and the liabilities assumed. While we use our best estimates and assumptions to accurately value assets acquired and liabilities assumed at the business acquisition date as well as any contingent consideration, where applicable, our estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the business acquisition date, we record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Upon the conclusion of a business acquisition’s measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to our consolidated statements of operations. In addition, uncertain tax positions and tax related valuation allowances assumed in a business combination are initially estimated as of the acquisition date. We reevaluate these items quarterly based upon facts and circumstances that existed as of the business acquisition date with any adjustments to our preliminary estimates being recorded to goodwill if identified within the measurement period. Subsequent to the measurement period or our final determination of the tax allowance’s or contingency’s estimated value, whichever comes first, changes to these uncertain tax positions and tax related valuation allowances will affect our provision for income taxes in our consolidated statement of operations and could have a material impact on our results of operations and financial position. |
Long Lived Assets | Long Lived Assets The Company reviews the carrying values of its long-lived assets for possible impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the expected future cash flow from the use of the asset and its eventual disposition is less than the carrying amount of the asset, an impairment loss is recognized and measured using the fair value of the related asset. No impairment charges were incurred during the nine months ended September 30, 2022 or for the year ended December 31, 2021, as the Company was still in the early phases of our business plan and operating losses were expected in our early phases. On March 11, 2020, the World Health Organization (“WHO”) declared the COVID-19 outbreak to be a global pandemic. In addition to the devastating effects on human life, the pandemic is having a negative ripple effect on the global economy, leading to disruptions and volatility in the global financial markets. Most U.S. states and many countries have issued policies intended to stop or slow the further spread of the disease. We have observed supply chain disruptions from the COVID-19 pandemic that has contributed to delays in the completion of the manufacturing of our RPCs as well as certain refurbishments to our precious metal extraction machines, although we do not believe that these delays have constituted a triggering event for impairment of our assets. Our Kuwait operations were suspended to comply with the social distancing measures implemented in Kuwait, but in 2022 has allowed for the Company to obtain site personnel visas to recommence operations. Our Utah operations were temporarily suspended from March through May 2020, but have since resumed in full in its manufacturing of its RPCs, and construction and implementation of site and infrastructure preparations in anticipation of commencing operations in 2022. The Company has been in discussions for the potential sale of the precious metal extraction business and ammonia synthesis business, or certain assets of those businesses, including its equipment. The Company is exploring all options including operating the business, creating a joint venture to operate the business, or appraising the businesses or their assets for the potential sale for at least the Company’s carrying value. There can be no assurance that market conditions will not change or demand for the Company’s services will continue, which could result in impairment of long-lived assets in the future. |
Asset Retirement Obligations | Asset Retirement Obligations Under ASC 410-20, Asset Retirement and Environmental Obligations – Asset Retirement Obligations, which relates to accounting requirements for costs associated with legal obligations to retire tangible, long-lived assets, the Company records an Asset Retirement Obligation (“ARO”) at fair value in the period in which it is incurred by increasing the carrying amount of the related long-lived asset. In each subsequent period, liability is accreted over time towards the ultimate obligation amount and the capitalized costs are depreciated over the useful life of the related asset. The Company did not identify any significant or material cost after review; thus, no |
Intangible Assets and Goodwill: | Intangible Assets and Goodwill: We account for intangible assets and goodwill in accordance with ASC 350 “Intangibles-Goodwill and Other” We assess our intangible assets in accordance with ASC 360 “ Property, Plant, and Equipment The Company performs its annual goodwill impairment test in the fourth quarter each year, and more frequently if facts and circumstances indicate such assets may be impaired, including significant declines in actual or future projected cash flows and significant deterioration of market conditions. The Company’s goodwill impairment assessment includes a qualitative assessment to determine whether it is more likely than not that the fair value of the goodwill is below its carrying value, each year, and more often if there are significant changes in business conditions that could result in impairment. When a quantitative analysis is considered necessary for the annual impairment analysis of goodwill, the Company develops an estimated fair value for the reporting unit considering three different approaches: 1) market value, using the Company’s stock price plus outstanding debt; 2) discounted cash flow analysis; and 3) multiple of earnings before interest, taxes, depreciation and amortization based upon relevant industry data. The estimated fair value of the reporting unit is then compared to its carrying amount, including goodwill. If the estimated fair value exceeds the carrying amount, goodwill is not considered impaired. If the carrying amount, including goodwill, exceeds its estimated fair value, any excess of the carrying value of goodwill of the reporting unit over its fair value is recorded as an impairment. The Company has determined there has not been an interim impairment trigger since acquisition on August 1, 2022. Contingent liabilities From time to time the Company may work with success based professional service providers, including securities counsel for private offerings, which may require contingent payments to be made based on the future offering fundraising and financial performance of the offering. In the event that an offering does not perform or is never consummated, the Company may still be required to pay a portion of the success fees for the services provided in preparing the offering. The fair value of the contingent payments would be estimated using the present value of management's projections of the financial results. Failure to correctly project the financial results of the offering or settlement of legal fees related to the offering could materially impact our results of operations and financial position. |
Advertising Expense | Advertising Expense Advertising costs are expensed as incurred. The Company did not incur advertising expense for the nine months ended September 30, 2022 and 2021. |
Net Income/Loss Per Share | Net Income/Loss Per Share Basic net income (loss) per share is calculated by subtracting any preferred interest distributions from net income (loss), all divided by the weighted-average number of common shares outstanding for the period, without consideration for common stock equivalents. Diluted net income (loss) per common share is computed by dividing the net income (loss) by the weighted-average number of common share equivalents outstanding for the period determined using the treasury stock method if their effect is dilutive. Potential dilutive instruments as of September 30, 2022 and 2021 include the following: convertible notes payable convertible into approximately 14,560 177,617 none 666,667 2,006,251 183,333 133,333 466,667 80,000 |
Use of Estimates | 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, judgments, and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. We believe our critical accounting estimates relate to the following: Recoverability of current and noncurrent assets, revenue recognition, stock-based compensation, income taxes, effective interest rates related to long-term debt, marketable securities, cost basis and equity method investments, lease assets and liabilities, equity method investments, valuation of stock used to acquire assets, derivatives, and fair values of the intangible assets and goodwill related to business combinations. While our estimates and assumptions are based on our knowledge of current events and actions we may undertake in the future, actual results may ultimately differ from these estimates and assumptions. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments 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 adoption of ASC 820 did not have an impact on the Company’s financial position or operating results but did expand certain disclosures. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Additionally, ASC 820 requires the use of valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized below: Level 1: Applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. Level 2: Applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data. Level 3: Applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. The Company analyzes all financial instruments with features of both liabilities and equity under the Financial Accounting Standard Board’s (“FASB”) accounting standard for such instruments. Under this standard, financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The carrying amounts reported in the consolidated balance sheets for marketable securities are classified as Level 1 assets due to observable quoted prices for identical assets in active markets. The carrying amounts reported in the consolidated balance sheets for cash, prepaid expenses and other current assets, accounts payable and accrued expenses approximate their estimated fair market values based on the short-term maturity of these instruments. The recorded values of notes payable approximate their current fair values because of their nature, rates, and respective maturity dates or durations. |
Recent accounting pronouncements | Recent accounting pronouncements The FASB issued ASU No. 2021-08, Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, |
Revenue Recognition | Revenue Recognition We adopted Accounting Standards Codification 606, Revenue from Contracts with Customers (“ASC 606”). Due to the business combination in which we acquired Silver Fuels Delhi, LLC and White Claw Colorado City, LLC, for the nine months ended September 30, 2022, approximately 97 |
Major Customers and Concentration of Credit Risk | Major Customers and Concentration of Credit Risk The Company has two major customers, which account for approximately 96 99 |
Business Combination (Tables)
Business Combination (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of business combination | Schedule of business combination Common stock $ 4,287,655 Note payable to seller 28,664,284 Fair value of total consideration paid $ 32,951,939 Net assets acquired and liabilities assumed Assets acquired in business combination Current assets $ 6,573,359 Finance lease right-of-use assets (property, plant and equipment) 4,464,217 Other assets 546,834 Contract-based intangible assets 25,195,644 Total assets acquired $ 36,780,054 Liabilities assumed in business combination Current liabilities $ (7,054,734 ) Long term liabilities (3,335,409 ) Total liabilities acquired $ (10,390,143 ) Total net assets acquired $ 26,389,911 Goodwill $ 6,562,028 |
Schedule of proforma information | Schedule of proforma information (Unaudited) Nine months ended September 30, Nine months ended September 30, 2022 2021 Total net sales $ 47,667,690 $ 23,835,514 Loss from operations (7,143,460 ) (4,018,231 ) Net loss (attributable to Vivakor, Inc.) $ (8,402,844 ) $ (4,670,569 ) Basic and diluted loss per share (0.55 ) (0.31 ) Weighted average shares outstanding 15,284,240 14,873,495 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment, net | Schedule of property and equipment, net September 30, 2022 December 31, 2021 Gross Carrying Amount Accumulated Depreciation Net Book Value Gross Carrying Amount Accumulated Depreciation Net Book Value Office furniture and equipment $ 27,998 $ 5,434 $ 22,564 $ 14,998 $ 4,000 $ 10,998 Vehicles 36,432 24,288 12,144 48,248 26,306 21,942 Finance lease right-of-use assets 5,810,339 1,471,848 4,338,551 – – – Precious metal extraction machine- 1 ton 2,280,000 342,000 1,938,000 2,280,000 228,000 2,052,000 Precious metal extraction machine- 10 ton 5,320,000 798,000 4,522,000 5,320,000 532,000 4,788,000 Construction in process: Bioreactors 1,440,000 – 1,440,000 1,440,000 – 1,440,000 Nanosponge/Cavitation device 44,603 – 44,603 22,103 – 22,103 Remediation Processing Unit 1 6,116,013 – 6,116,013 6,249,082 – 6,249,082 Remediation Processing Unit 2 5,714,894 – 5,714,894 5,201,098 – 5,201,098 Remediation Processing Unit System A 3,739,637 – 3,739,637 2,561,467 – 2,561,467 Remediation Processing Unit System B 3,657,420 – 3,657,420 2,345,421 – 2,345,421 Total fixed assets $ 34,187,396 $ 2,641,570 $ 31,545,826 $ 25,482,417 $ 790,306 $ 24,692,111 |
Intellectual Property, Net an_2
Intellectual Property, Net and Goodwill (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Intellectual Property Net And Goodwill | |
Schedule of components of intellectual property | Schedule of components of intellectual property September 30, 2022 December 31, 2021 Gross Carrying Amount Accumulated Amortization Net Book Value Gross Carrying Amount Accumulated Amortization Net Book Value Extraction Technology patents $ 113,430 $ 10,565 $ 102,865 $ 113,430 $ 5,560 $ 107,870 Extraction Technology 16,385,157 6,280,977 10,104,180 16,385,157 5,666,534 10,718,623 Acquired crude oil contracts 25,195,644 445,925 24,749,719 – – – Ammonia synthesis patents 4,931,380 2,465,690 2,465,690 4,931,380 2,095,836 2,835,544 Total Intellectual property $ 46,625,611 $ 9,203,157 $ 37,422,454 $ 21,429,967 $ 7,767,930 $ 13,662,037 |
Schedule of goodwill | Schedule of goodwill Goodwill January 1, 2021 $ – Acquisition 6,562,028 September 30, 2022 $ 6,562,028 |
Accounts Payable and Accrued _2
Accounts Payable and Accrued Expenses (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Payables and Accruals [Abstract] | |
Schedule of accounts payable and accrued expenses | Schedule of accounts payable and accrued expenses September 30, December 31, 2022 2021 Accounts payable $ 6,524,550 $ 1,450,531 Office access deposits 340 340 Accrued compensation 603,207 175,000 Unearned revenue 41,871 – Accrued interest (various notes and loans payable 335,559 – Accrued interest (working interest royalty programs) 1,562,160 – Accrued tax penalties and interest 405,314 398,114 Accounts payable and accrued expenses $ 9,473,001 $ 2,023,985 |
Loans and Notes Payable (Tables
Loans and Notes Payable (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of loans and notes payable | Schedule of loans and notes payable September 30, December 31, 2022 2021 Various promissory notes and convertible notes $ 50,960 $ 50,960 Novus Capital Group LLC Note (a) 281,268 378,854 Triple T Notes 337,044 353,330 National Buick GMC 16,977 19,440 Various Convertible Bridge Notes (b) – 1,075,813 Blue Ridge Bank 410,200 410,200 Small Business Administration 299,900 318,175 JP Morgan Chase Bank 90,645 90,645 JBAH Holdings, LLC (c) 286,643 – Jorgan Development, LLC (c) 28,377,641 – Various Promissory Notes (d) 2,794,500 3,416,379 Total Notes Payable $ 32,945,778 $ 6,113,796 Loans and notes payable, current $ 971,441 $ 1,511,447 Loans and notes payable, current attributed to variable interest entity $ 2,597,709 $ 3,416,379 Loans and notes payable, long term $ 29,376,628 $ 1,185,970 |
Schedule of maturities of loans and notes payable | Schedule of maturities of loans and notes payable 2022 $ 2,461,420 2023 1,980,382 2024 16,756,429 2025 11,392,317 2026 124,285 Thereafter 230,945 Total $ 32,945,778 __________________ (a) On September 5, 2017, the Company acquired patents in the amount of $4,931,380 in which the Company also agreed to assume the encumbering debt on asset in the amount of $334,775 due in December 2019 with no interest accruing until 2020 and a deferred tax liability of $1,043,398. As of April 1, 2022, the lender agreed to extend the maturity of the note to April 1, 2023 with an initial payment of $52,448 and approximate monthly payment of $29,432 thereafter until the note is fully paid. (b) In 2021 and 2020 the Company entered into various convertible promissory notes as follows: Throughout 2021 and 2020 the Company entered into convertible promissory notes with an aggregate principal of $415,000. The notes accrue interest at 10% per annum and have a maturity of the earlier of 12 months or the consummation of the Company listing its Common Stock on a senior stock exchange. The notes are convertible at the Company’s option into shares of the Company’s common stock at a price equal to 80% of the opening price of the Company’s common stock on the national exchange or the offering price paid by the investors in the financing in connection with the uplist, whichever is lower, or (ii) repaid in cash in an amount equal to the indebtedness being repaid plus a premium payment equal to 15% of the amount being repaid. If an event of default has occurred and the Company does not convert the amounts due under the Note into the Company’s common stock, then the Company will have the option to convert the outstanding indebtedness into shares of the Company’s common stock at a price equal to 80% of the weighted average trading price of the Company’s common stock on the OTC Markets, or be repaid in cash in an amount equal to all principal and interest due under the Note. All of these notes were converted to common stock as of September 30, 2022. On October 13, 2020, the Company entered into a convertible promissory note in an amount of $280,500 having an interest rate of 12% per annum. The note bears a 10% Original Issue Discount. The loan shall mature in 1 year and may be convertible at the lower of $12.00 or 80% of the lowest median daily traded price over ten trading days prior to conversion, but in the event of a Qualified Uplist the note may be converted at a 30% discount to market. The Company also issued 3,333 restricted shares with no registration rights in conjunction with this note, which was recorded as a debt discount in the amount of $44,000, which is amortized to interest expense over the term of the agreements using the effective interest method. On March 28, 2021 the parties amended this agreement to state that in no event shall the conversion price be lower than $3.00 per share. In October 2021 the parties agreed to extend the maturity of this loan to April 13, 2022 in exchange for an increase in principal owed of $30,000. This note has been converted to common stock as of September 30, 2022. On February 4, 2021, the Company entered into a convertible promissory note in an amount of $277,778 having an interest rate of 12% per annum. The note bears a 10% Original Issue Discount. The loan shall mature in 1 year and may be convertible at the lower of $12.00 or 80% of the lowest median daily traded price over ten trading days prior to conversion, but in the event of a Qualified Uplist the note may be converted at a 30% discount to market. The Company also issued 3,333 restricted shares with no registration rights in conjunction with this note, which was recorded as a debt discount in the amount of $36,000, which is amortized to interest expense over the term of the agreements using the effective interest method. On March 28, 2021 the parties amended this agreement to state that in no event shall the conversion price be lower than $3.00 per share. In February 2022 the parties agreed to extend the maturity of this loan to August 8, 2022 in exchange for an increase in principal owed of $25,000. This note has been converted to common stock as of September 30, 2022. (c) On August 1, 2022, we closed a Membership Interest Purchase Agreement, (the “MIPA”), with Jorgan Development, LLC, ("Jorgan") and JBAH Holdings, LLC (“JBAH”), as the equity holders of Silver Fuels Delhi, LLC ("SFD") and White Claw Colorado City, LLC ("WCCC" ) whereby, the Company acquired all of the issued and outstanding membership interests in each of SFD and WCCC, making SFD and WCCC wholly owned subsidiaries of the Company. The consideration for the membership interests included secured three-year promissory notes in the amount of $286,643 to JBAH and $28,377,641 to Jorgan, which accrue interest of prime plus 3% on the outstanding balance of the notes. Under the MIPA, the Company has committed to make a payment to Jorgan and JBAH on or before February 1, 2024 in the amounts of $16,306,754 to Jorgan and $164,715 to JBAH, whether in cash or unrestricted common stock. In the event of a breach of the terms of the notes, the sole and exclusive remedy of the holder of the notes will be to unwind the MIPA transaction. The principal amount of the notes, together with any and all accrued and unpaid interest thereon, will be paid to on a monthly basis in an amount equal to the Monthly Free Cash Flow continuing thereafter on the twentieth (20 th (d) The balance of these various promissory notes are related to the special purchase vehicle, Viva Wealth Fund I, LLC (VWFI) of which the balance primarily related to an offering up to $25,000,000 in convertible notes in a private offering. As of September 30, 2022, VWFI has raised $11,125,000 and converted $8,950,000 of this debt to VWFI LLC units. A convertible note will automatically convert into the LLC units at the earlier of (i) the date that the Equipment is placed into quality control and testing or (ii) six months from the date of investment. The convertible notes will accrue interest at 12% per annum and are paid quarterly. At the maturity date, remaining interest will be paid, at which time no further interest payments will accrue. Upon the offering termination date, all units accepted for any series of equipment will automatically convert to Vivakor common stock if the Company has not accepted subscriptions for at least $6,250,000 for a series of equipment. The conversion price of the automatic stock conversion will be the greater of $13.50 or a 10% discount to market per share or in the event of a public offering, 200% of the per share price of the Company common stock sold in an underwritten offering, which was closed on February 14, 2022 at $5.00 per share. The termination date of the offering has been extended until March 31, 2023 in the sole discretion of the Company. As of April 28, 2021 VWFI has reached $6,250,000 in funding and has released the funding for construction of RPC Series A. VWFI has commenced fundraising for RPC Series B, and as of September 30, 2022, VWFI has raised approximately $4,875,000 to manufacture RPC Series B as of September 30, 2022. Subsequent to September 30, 2022 an additional $290,000 has been raised in relation this offering, and $290,000 of this debt has been converted into units of the LLC. VWFI has also entered into various master revolving notes outside of the offering: $329,500, from a related party of VWFI, which accrues 6% interest per annum, has a maturity date of October 11, 2023, where no payments are made prior to the maturity date unless at the option of the fund; $300,000, from a related party of VWFI, which accrues 5% interest per annum, has a maturity date of July 14, 2024, where no payments are made prior to the maturity date unless at the option of the fund; $184,415, made up of two loans with the Company, which accrue between 3-5% interest per annum, have maturity dates of October 14, 2023 and April 20, 2024, where no payments are made prior to the maturity date unless at the option of the fund, and all principal and interest of these two loans is eliminated upon consolidation. |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Finance lease cost | Finance lease cost Amortization of right of use asset $ 112,666 Interest on lease liabilities 66,481 Total lease cost $ 179,147 |
Schedule of financing lease liability | Schedule of financing lease liability 2022 $ 240,975 2023 963,901 2024 963,901 2025 553,780 2026 432,443 Total undiscounted lease payments 3,155,000 Less: Imputed interest 962,598 Present value of lease payments 2,192,401 Add: carrying value of lease obligation at end of lease term 1,753,000 Present value of lease payments 2,192,401 Total finance lease obligations 3,945,401 Less: Unamortized financing fees 70,041 Total lease obligations, net $ 3,875,360 Finance lease liabilities, current $ 652,440 Finance lease liabilities, long-term $ 3,222,920 Weighted-average remaining lease term 3.47 Weighted-average discount rate 9.93 |
Schedule of lessee operating lease liability | Schedule of lessee operating lease liability 2022 $ 91,560 2023 370,902 2024 304,892 2025 16,135 Total undiscounted lease payments 783,489 Less: Imputed interest 80,854 Present value of lease payments $ 702,635 Operating lease liabilities, current $ 364,103 Operating lease liabilities, long-term $ 338,531 Weighted-average remaining lease term 2.11 Weighted-average discount rate 7.00 |
Long-term Debt (Tables)
Long-term Debt (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Schedule Of Long-Term Debt | Schedule Of Long-Term Debt 2022 2021 Principal $ 2,196,233 $ 2,196,233 Accrued interest 2,997,529 4,205,144 Debt discount (215,659 ) (226,823 ) Total long term debt $ 4,978,103 $ 6,174,554 Long term debt, current $ 9,363 $ 3,256 Long term debt $ 4,968,740 $ 6,171,298 |
Schedule of long-term debt maturities | Schedule of long-term debt maturities 2022 $ 950 2023 11,598 2024 15,002 2025 19,409 2026 25,114 Thereafter 2,124,160 Total $ 2,196,233 |
Temporary Equity (Tables)
Temporary Equity (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Temporary Equity | |
Schedule of temporary equity | Schedule of temporary equity Convertible Preferred Stock Series B Series B-1 Series C-1 Shares Amount Shares Amount Shares Amount December 31, 2020 216,916 $ 1,301,500 467,728 $ 3,507,981 255,289 $ 4,550,977 Series C-1 Issue for a reduction in stock payables – – – – 5,413 64,950 Dividend paid in Series B-1 Preferred Stock – – – – 5,626 – Conversion of Series B and B-1 Preferred Stock to Common Stock (216,916 ) (1,301,500 ) (467,728 ) (3,507,981 ) (266,328 ) (4,615,927 ) September 30, 2021 – $ – – $ – – $ – |
Share-Based Compensation & Wa_2
Share-Based Compensation & Warrants (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
Schedule of warrant assumptions | Schedule of warrant assumptions December 31, 2020 through September 30, 2022 Risk-free interest rate 0.24 3.04 Expected dividend yield None Expected life of warrants 3.33 10 Expected volatility rate 169 273 |
Schedule of option activity | Schedule of option activity Weighted Weighted Average Average Remaining Number Exercise Contractual of Shares Price Life (Years) Outstanding, December 31, 2021 650,000 $ 12.00 7.53 Granted 2,112,919 2.24 6.60 Exercised (16,667 ) 11.10 – Forfeited/canceled (740,000 ) 10.00 – Outstanding, September 30, 2022 2,006,251 $ 2.56 6.93 Exercisable, December 31, 2021 180,000 $ 12.00 7.01 Exercisable, September 30, 2022 1,175,059 $ 2.67 7.09 Outstanding, December 31, 2020 650,000 $ 12.00 8.53 Outstanding, September 30, 2021 650,000 $ 12.00 7.78 Exercisable, December 31, 2020 47,083 $ 12.00 6.27 Exercisable, September 30, 2021 144,167 $ 12.00 7.01 |
Basis of Presentation (Details
Basis of Presentation (Details Narrative) - USD ($) | 9 Months Ended | |||
Feb. 14, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Product Information [Line Items] | ||||
Stockholders' Equity, Reverse Stock Split | 1-for-30 reverse split | |||
Assets | $ 94,805,667 | $ 47,744,245 | ||
Liabilities | 57,131,776 | 20,191,112 | ||
Note receivable | 1,156,526 | 1,194,235 | ||
Notes Payable | 32,945,778 | 6,113,796 | ||
Asset Retirement Obligations | $ 0 | |||
Warrants outstanding | 80,000 | |||
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Two Customers [Member] | ||||
Product Information [Line Items] | ||||
Concentration Risk, Percentage | 99% | |||
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Crude Oil Revenue [Member] | ||||
Product Information [Line Items] | ||||
Concentration Risk, Percentage | 97% | |||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Two Customers [Member] | ||||
Product Information [Line Items] | ||||
Concentration Risk, Percentage | 96% | |||
Convertible Notes Payable [Member] | ||||
Product Information [Line Items] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 14,560 | 177,617 | ||
Convertible Series A Preferred Stock [Member] | ||||
Product Information [Line Items] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 0 | 666,667 | ||
Stock Options Granted To Employees [Member] | ||||
Product Information [Line Items] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 2,006,251 | 183,333 | ||
Stock Options Granted To Board Members Or Consultants [Member] | ||||
Product Information [Line Items] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 133,333 | 466,667 | ||
R P C Design And Manufacturing L L C [Member] | ||||
Product Information [Line Items] | ||||
Noncontrolling Interest in Variable Interest Entity | $ 303,451 | 629,694 | ||
RDM [Member] | ||||
Product Information [Line Items] | ||||
Notes Payable | 851,318 | 354,566 | ||
Viva Wealth Fund I [Member] | ||||
Product Information [Line Items] | ||||
Cash attributable to VIE | 147,865 | 199,952 | ||
Variable Interest Entity, Primary Beneficiary [Member] | Vivaventures UTSI, LLC [Member] | ||||
Product Information [Line Items] | ||||
Assets | 3,345,351 | 3,753,296 | ||
Liabilities | 47,049 | 12,608 | ||
Variable Interest Entity, Primary Beneficiary [Member] | Vivaventures Royalty II, LLC [Member] | ||||
Product Information [Line Items] | ||||
Assets | 3,146,973 | 2,648,810 | ||
Liabilities | 1,720 | 300 | ||
Variable Interest Entity, Primary Beneficiary [Member] | Vivaopportunity Fund LLC [Member] | ||||
Product Information [Line Items] | ||||
Assets | 2,119,826 | 2,119,961 | ||
Liabilities | 8,755 | 0 | ||
Variable Interest Entity, Primary Beneficiary [Member] | International Metals Exchange, LLC [Member] | ||||
Product Information [Line Items] | ||||
Assets | 29,780 | 30,461 | ||
Liabilities | 1,900 | $ 1,900 | ||
Variable Interest Entity, Primary Beneficiary [Member] | Silver Fuels Delhi, LLC [Member] | ||||
Product Information [Line Items] | ||||
Note receivable | $ 557,401 |
Liquidity (Details Narrative)
Liquidity (Details Narrative) - USD ($) | 9 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2021 | |
Security Owned and Sold, Not yet Purchased, at Fair Value [Line Items] | ||
Cash | $ 4,521,791 | |
Marketable Securities | $ 2,892,319 | $ 2,231,218 |
Public Offering [Member] | ||
Security Owned and Sold, Not yet Purchased, at Fair Value [Line Items] | ||
Stock Issued During Period, Shares, New Issues | 1,600,000 | |
Proceeds from Issuance or Sale of Equity | $ 8,000,000 |
Business Combination (Details)
Business Combination (Details) - USD ($) | 2 Months Ended | ||
Aug. 01, 2022 | Sep. 30, 2022 | Dec. 31, 2021 | |
Business Acquisition [Line Items] | |||
Goodwill | $ 6,562,028 | $ 0 | |
SFD and WCCC [Member] | |||
Business Acquisition [Line Items] | |||
Stock Issued During Period, Value, Acquisitions | $ 4,287,655 | ||
Business Combination, Consideration Transferred, Liabilities Incurred | 28,664,284 | ||
Business Combination, Consideration Transferred | 32,951,939 | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Other | 6,573,359 | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | 4,464,217 | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Other Noncurrent Assets | 546,834 | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill | 25,195,644 | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets | 36,780,054 | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities | (7,054,734) | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities | (3,335,409) | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities | (10,390,143) | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net | 26,389,911 | ||
Goodwill | $ 6,562,028 |
Business Combinations (Details
Business Combinations (Details - Proforma information) - USD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |||
Total net sales | $ 47,667,690 | $ 23,835,514 | |
Loss from operations | (7,143,460) | (4,018,231) | |
Net loss (attributable to Vivakor, Inc.) | $ (8,402,844) | $ (4,670,569) | |
Business Acquisition, Pro Forma Earnings Per Share, Basic | $ (0.55) | $ (0.31) | |
Business Acquisition, Pro Forma Earnings Per Share, Diluted | $ (0.55) | $ (0.31) | |
Weighted Average Basic Shares Outstanding, Pro Forma | 15,284,240 | 14,873,495 | |
Pro Forma Weighted Average Shares Outstanding, Diluted | 15,284,240 | 14,873,495 |
Business Combination (Details N
Business Combination (Details Narrative) - SFD and WCCC [Member] | 2 Months Ended |
Aug. 01, 2022 USD ($) shares | |
Business Acquisition [Line Items] | |
Stock Issued During Period, Shares, Acquisitions | shares | 3,009,552 |
Notes Payable, Noncurrent | $ | $ 28,664,284 |
Accounts receivable (Details Na
Accounts receivable (Details Narrative) - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Defined Benefit Plan Disclosure [Line Items] | ||
Allowance for Doubtful Accounts, Premiums and Other Receivables | $ 0 | $ 33,000 |
Jorgan And Jbah [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Accounts Receivable, Related Parties | 1,186,803 | |
[custom:OtherAccountsReceivableRelatedParties-0] | $ 33,602 |
Prepaid Expenses and Other As_2
Prepaid Expenses and Other Assets (Details Narrative) - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Office and warehouse lease deposits | $ 61,676 | $ 73,245 |
Deposits | 340 | $ 340 |
Finance lease deposits | 579,034 | |
Vendor [Member] | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Deposits | $ 130,000 |
Marketable Securities (Details
Marketable Securities (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Aug. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Unrealized gain (loss) on marketable securities | $ 1,074,290 | $ (2,481,175) | $ 661,101 | $ 1,253,100 | ||||
Marketable securities | 2,892,319 | 2,892,319 | $ 2,231,218 | |||||
Unrealized gain (loss) on marketable securities | (1,074,290) | 2,481,175 | (661,101) | (1,253,100) | ||||
Odyssey Group [Member] | ||||||||
Investment Owned, Balance, Shares | 3,309,758 | 826,376,882 | ||||||
Proceeds from Sale of Other Investments | 860,491 | |||||||
Unrealized gain (loss) on marketable securities | 379,011 | 402,114 | ||||||
Unrealized gain (loss) on marketable securities | (379,011) | (402,114) | ||||||
Scepter Holdings [Member] | ||||||||
Unrealized gain (loss) on marketable securities | 661,101 | 850,985 | ||||||
Marketable securities | 1,818,029 | 1,818,029 | $ 2,231,218 | $ 881,768 | ||||
Note receivable converted, amount converted | $ 81,768 | |||||||
Note receivable converted, shares received | 26,376,882 | |||||||
Gain (Loss) on disposition of asset | $ 87,044 | |||||||
Unrealized loss on marketable securities | $ 1,074,290 | $ 1,389,014 | ||||||
Unrealized gain (loss) on marketable securities | $ (661,101) | $ (850,985) |
Inventories (Details Narrative)
Inventories (Details Narrative) | Sep. 30, 2022 USD ($) |
Fexix Iron [Member] | |
Inventory [Line Items] | |
Acquisition costs | $ 192,000 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Property, Plant and Equipment [Line Items] | ||
Gross Carrying Amount | $ 34,187,396 | $ 25,482,417 |
Accumulated Depreciation | 2,641,570 | 790,306 |
Net Book Value | 31,545,826 | 24,692,111 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Gross Carrying Amount | 27,998 | 14,998 |
Accumulated Depreciation | 5,434 | 4,000 |
Net Book Value | 22,564 | 10,998 |
Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Gross Carrying Amount | 36,432 | 48,248 |
Accumulated Depreciation | 24,288 | 26,306 |
Net Book Value | 12,144 | 21,942 |
Finance Lease Right Of Use Asset [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Gross Carrying Amount | 5,810,339 | 0 |
Accumulated Depreciation | 1,471,848 | 0 |
Net Book Value | 4,338,551 | 0 |
Precious Metal Extraction Machine- 1 Ton [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Gross Carrying Amount | 2,280,000 | 2,280,000 |
Accumulated Depreciation | 342,000 | 228,000 |
Net Book Value | 1,938,000 | 2,052,000 |
Precious Metal Extraction Machine- 10 Ton [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Gross Carrying Amount | 5,320,000 | 5,320,000 |
Accumulated Depreciation | 798,000 | 532,000 |
Net Book Value | 4,522,000 | 4,788,000 |
Bioreactors [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Gross Carrying Amount | 1,440,000 | 1,440,000 |
Accumulated Depreciation | 0 | 0 |
Net Book Value | 1,440,000 | 1,440,000 |
Nanosponge/Cavitation Device [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Gross Carrying Amount | 44,603 | 22,103 |
Accumulated Depreciation | 0 | 0 |
Net Book Value | 44,603 | 22,103 |
Remediation Processing Unit 1 [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Gross Carrying Amount | 6,116,013 | 6,249,082 |
Accumulated Depreciation | 0 | 0 |
Net Book Value | 6,116,013 | 6,249,082 |
Remediation Processing Unit 2 [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Gross Carrying Amount | 5,714,894 | 5,201,098 |
Accumulated Depreciation | 0 | 0 |
Net Book Value | 5,714,894 | 5,201,098 |
Remediation Processing Unit System A [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Gross Carrying Amount | 3,739,637 | 2,561,467 |
Accumulated Depreciation | 0 | 0 |
Net Book Value | 3,739,637 | 2,561,467 |
Remediation Processing Unit System B [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Gross Carrying Amount | 3,657,420 | 2,345,421 |
Accumulated Depreciation | 0 | 0 |
Net Book Value | $ 3,657,420 | $ 2,345,421 |
Property and Equipment (Detai_2
Property and Equipment (Details Narrative) - USD ($) | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Property, Plant and Equipment [Line Items] | ||
Depreciation | $ 500,352 | $ 8,671 |
Interest Costs Capitalized | $ 499,537 | $ 1,234,801 |
Equipment [Member] | Series C-1 Preferred Stock [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Stock Issued During Period, Shares, Purchase of Assets | 5,413 | |
Stock Issued During Period, Value, Purchase of Assets | $ 64,950 |
Intellectual Property, Net an_3
Intellectual Property, Net and Goodwill (Details) - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | $ 46,625,611 | $ 21,429,967 |
Accumulated Amortization | 9,203,157 | 7,767,930 |
Finite-Lived Intangible Assets, Net | 37,422,454 | 13,662,037 |
Extraction Technology Patents [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 113,430 | 113,430 |
Accumulated Amortization | 10,565 | 5,560 |
Finite-Lived Intangible Assets, Net | 102,865 | 107,870 |
Extraction Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 16,385,157 | 16,385,157 |
Accumulated Amortization | 6,280,977 | 5,666,534 |
Finite-Lived Intangible Assets, Net | 10,104,180 | 10,718,623 |
Acquired Crude Oil Contracts [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 25,195,644 | 0 |
Accumulated Amortization | 445,925 | 0 |
Finite-Lived Intangible Assets, Net | 24,749,719 | 0 |
Ammonia Synthesis Patents [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 4,931,380 | 4,931,380 |
Accumulated Amortization | 2,465,690 | 2,095,836 |
Finite-Lived Intangible Assets, Net | $ 2,465,690 | $ 2,835,544 |
Goodwill (Details)
Goodwill (Details) | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
Intellectual Property Net And Goodwill | |
Goodwill, Beginning Balance | $ 0 |
Goodwill, Period Increase (Decrease) | 6,562,028 |
Goodwill, Ending Balance | $ 6,562,028 |
Intellectual Property, Net an_4
Intellectual Property, Net and Goodwill (Details Narrative) - USD ($) | 9 Months Ended | ||
Aug. 01, 2022 | Sep. 30, 2022 | Dec. 31, 2021 | |
Intellectual Property Net And Goodwill | |||
Purchase price | $ 32,900,000 | ||
Goodwill | $ 6,562,028 | $ 0 | |
Other Finite-Lived Intangible Assets, Gross | 25,195,644 | ||
Amortization of Intangible Assets | 445,925 | ||
Finite-Lived Intangible Asset, Expected Amortization, Year Two | 1,114,812 | ||
Finite-Lived Intangible Asset, Expected Amortization, Year Four | 2,675,644 | ||
Other Intangible Assets, Net | $ 24,749,719 |
Accounts Payable and Accrued _3
Accounts Payable and Accrued Expenses (Details) - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Payables and Accruals [Abstract] | ||
Accounts payable | $ 6,524,550 | $ 1,450,531 |
Office access deposits | 340 | 340 |
Accrued compensation | 603,207 | 175,000 |
Unearned revenue | 41,871 | 0 |
Accrued interest (various notes and loans payable | 335,559 | 0 |
Accrued tax penalties and interest | 405,314 | 398,114 |
Accounts payable and accrued expenses | $ 9,473,001 | $ 2,023,985 |
Accounts Payable and Accrued _4
Accounts Payable and Accrued Expenses (Details Narrative) | Sep. 30, 2022 USD ($) |
Payables and Accruals [Abstract] | |
Accounts Payable, Trade, Current | $ 3,731,888 |
Loans and Notes Payable (Detail
Loans and Notes Payable (Details) - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Debt Instrument [Line Items] | ||
Total Notes Payable | $ 32,945,778 | $ 6,113,796 |
Loans and notes payable, current | 971,441 | 1,511,447 |
Loans and notes payable, current attributed to variable interest entity | 2,597,709 | 3,416,379 |
Loans and notes payable, long term | 29,376,628 | 1,185,970 |
Various Promissory Notes And Convertible Notes [Member] | ||
Debt Instrument [Line Items] | ||
Total Notes Payable | 50,960 | 50,960 |
Novus Capital Group L L C Note [Member] | ||
Debt Instrument [Line Items] | ||
Total Notes Payable | 281,268 | 378,854 |
Triple T Notes [Member] | ||
Debt Instrument [Line Items] | ||
Total Notes Payable | 337,044 | 353,330 |
National Buick G M C [Member] | ||
Debt Instrument [Line Items] | ||
Total Notes Payable | 16,977 | 19,440 |
Various Convertible Bridge Notes [Member] | ||
Debt Instrument [Line Items] | ||
Total Notes Payable | 0 | 1,075,813 |
Blue Ridge Bank [Member] | ||
Debt Instrument [Line Items] | ||
Total Notes Payable | 410,200 | 410,200 |
Small Business Administration [Member] | ||
Debt Instrument [Line Items] | ||
Total Notes Payable | 299,900 | 318,175 |
J P Morgan Chase Bank [Member] | ||
Debt Instrument [Line Items] | ||
Total Notes Payable | 90,645 | 90,645 |
J B A H Holdings L L C [Member] | ||
Debt Instrument [Line Items] | ||
Total Notes Payable | 286,643 | 0 |
Jorgan Development L L C [Member] | ||
Debt Instrument [Line Items] | ||
Total Notes Payable | 28,377,641 | 0 |
Various Promissory Notes [Member] | ||
Debt Instrument [Line Items] | ||
Total Notes Payable | $ 2,794,500 | $ 3,416,379 |
Lease Cost (Details)
Lease Cost (Details) - USD ($) | 1 Months Ended | 2 Months Ended |
Dec. 28, 2021 | Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Amortization of right of use asset | $ 112,666 | |
Interest on lease liabilities | $ 82,400 | 66,481 |
Total lease cost | $ 179,147 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Commitments and Contingencies Disclosure [Abstract] | ||
2022 | $ 240,975 | |
2023 | 963,901 | |
2024 | 963,901 | |
2025 | 553,780 | |
2026 | 432,443 | |
Total undiscounted lease payments | 3,155,000 | |
Less: Imputed interest | 962,598 | |
Present value of lease payments | 2,192,401 | |
Add: carrying value of lease obligation at end of lease term | 1,753,000 | |
Total finance lease obligations | 3,945,401 | |
Less: Unamortized financing fees | 70,041 | |
Total lease obligations, net | 3,875,360 | |
Finance lease liabilities, current | 652,440 | $ 0 |
Finance lease liabilities, long-term | $ 3,222,920 | $ 0 |
Weighted-average remaining lease term | 3 years 5 months 19 days | |
Weighted-average discount rate | 9.93% |
Commitments and Contingencies_3
Commitments and Contingencies (Details 1) - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Commitments and Contingencies Disclosure [Abstract] | ||
2022 | $ 91,560 | |
2023 | 370,902 | |
2024 | 304,892 | |
2025 | 16,135 | |
Total undiscounted lease payments | 783,489 | |
Less: Imputed interest | 80,854 | |
Present value of lease payments | 702,635 | |
Operating lease liabilities, current | 364,103 | $ 287,769 |
Operating lease liabilities, long-term | $ 338,531 | |
Weighted-average remaining lease term | 2 years 1 month 9 days | |
Weighted-average discount rate | 7% |
Commitments and Contingencies_4
Commitments and Contingencies (Details Narrative) - USD ($) | 1 Months Ended | 2 Months Ended | 9 Months Ended | ||||||||
Aug. 01, 2022 | Dec. 28, 2021 | Mar. 17, 2020 | Sep. 30, 2022 | Sep. 30, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Mar. 28, 2022 | Feb. 01, 2022 | Dec. 31, 2021 | Sep. 15, 2019 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Monthly payments | $ 39,313 | ||||||||||
Purchase price | $ 32,900,000 | ||||||||||
Minimum cash reserve payments | $ 24,000 | ||||||||||
Cash Reserve Deposit Required and Made | $ 369,109 | $ 369,109 | $ 369,109 | ||||||||
Imputed interest rates | 12.39% | ||||||||||
Imputed interest rates | 10.36% | ||||||||||
Future minimum lease payments 2022 | 123,063 | 123,063 | $ 123,063 | ||||||||
Future minimum lease payments 2023 | 492,145 | 492,145 | 492,145 | ||||||||
Future minimum lease payments 2024 | 492,145 | 492,145 | 492,145 | ||||||||
Future minimum lease payments 2025 | 82,024 | 82,024 | 82,024 | ||||||||
Consideration | 2,500,000 | ||||||||||
Original cost | 875,000 | ||||||||||
Lease payments received | 471,756 | 471,756 | 471,756 | ||||||||
Cash reserves for leases | 138,913 | 138,913 | $ 138,913 | ||||||||
Imputed interest | 8.54% | ||||||||||
Financing fee | $ 82,400 | 66,481 | |||||||||
Debt issuance costs amortized | 2,746 | ||||||||||
Finance lease liability | 3,875,360 | 3,875,360 | $ 3,875,360 | ||||||||
Lease payments next twelve months | 91,560 | 91,560 | 91,560 | ||||||||
Lease payments next two months | 370,902 | 370,902 | 370,902 | ||||||||
Lease payments next three months | 304,892 | 304,892 | 304,892 | ||||||||
Lease payments next four months | 16,135 | 16,135 | 16,135 | ||||||||
Lease payment | 2,000 | ||||||||||
Right-of-use asset for operating leases | 648,201 | 648,201 | 648,201 | $ 663,291 | |||||||
Rent expense | $ 294,382 | $ 246,526 | |||||||||
Stock options cancelled | 451,158 | ||||||||||
Chief Executive Officer [Member] | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Stock options cancelled | 503,935 | ||||||||||
Maxus [Member] | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Minimum cash reserve payments | $ 16,100 | ||||||||||
Maxus Capital Group L L C [Member] | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Business Combination, Consideration Transferred | $ 1,025,000 | 1,350,861 | |||||||||
Monthly payments | 22,100 | 18,912 | |||||||||
Purchase price | $ 1 | 877,519 | |||||||||
First Lease [Member] | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Minimum cash reserve payments | 8,945 | ||||||||||
Second Lease [Member] | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Minimum cash reserve payments | 15,055 | ||||||||||
Maxus Lease Obligation [Member] | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Future minimum lease payments 2022 | 117,939 | 117,939 | 117,939 | ||||||||
Future minimum lease payments 2023 | 471,756 | 471,756 | 471,756 | ||||||||
Future minimum lease payments 2024 | 471,756 | 471,756 | 471,756 | ||||||||
Future minimum lease payments 2025 | 471,756 | 471,756 | 471,756 | ||||||||
Future minimum lease payments 2026 | 432,443 | 432,443 | 432,443 | ||||||||
Jamboree Center [Member] | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Lease payments next twelve months | 21,927 | 21,927 | 21,927 | ||||||||
Lease payments next two months | 22,832 | 22,832 | 22,832 | ||||||||
Lease payments next three months | 23,737 | 23,737 | 23,737 | ||||||||
Lease payments next four months | 24,712 | 24,712 | 24,712 | ||||||||
Lessee, Operating Lease, Liability, to be Paid, Year Five | 25,686 | 25,686 | 25,686 | ||||||||
Security deposit | $ 51,992 | ||||||||||
Speedway Commerce Center [Member] | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Lease payments next twelve months | 1,950 | 1,950 | 1,950 | ||||||||
Lease payments next two months | 2,028 | 2,028 | 2,028 | ||||||||
Lease payments next three months | 2,110 | 2,110 | 2,110 | ||||||||
Security deposit | $ 2,418 | ||||||||||
Victory Holdings [Member] | |||||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||||
Lease payments next twelve months | 867 | 867 | 867 | ||||||||
Lease payments next three months | 3,657 | 3,657 | 3,657 | ||||||||
Lease payments next four months | 3,766 | 3,766 | 3,766 | ||||||||
Security deposit | $ 3,766 | ||||||||||
Lease payments next two and three months | $ 3,550 | $ 3,550 | $ 3,550 |
Long-term Debt (Details)
Long-term Debt (Details) - Long-Term Debt [Member] - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Extinguishment of Debt [Line Items] | ||
Principal | $ 2,196,233 | $ 2,196,233 |
Accrued interest | 2,997,529 | 4,205,144 |
Debt discount | (215,659) | (226,823) |
Total long term debt | 4,978,103 | 6,174,554 |
Long term debt, current | 9,363 | 3,256 |
Long term debt | $ 4,968,740 | $ 6,171,298 |
Stockholders' Equity (Details N
Stockholders' Equity (Details Narrative) | Aug. 01, 2022 USD ($) shares |
Offsetting Assets [Line Items] | |
Purchase price | $ | $ 32,900,000 |
Membership Interest Purchase Agreement [Member] | |
Offsetting Assets [Line Items] | |
Purchase price | $ | $ 32,900,000 |
Number of shares issued | shares | 3,009,552 |
Membership Interest rate | 19.99% |
Number of shares issued | shares | 3,009,552 |
Temporary Equity (Details)
Temporary Equity (Details) - shares | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Dividend paid in Series B-1 Preferred Stock, shares | 0 | 42,196 |
Convertible Preferred Stock Series B [Member] | ||
Beginning balance, shares | 216,916 | |
Conversion of Series B and B-1 Preferred Stock to Common Stock, shares | (216,916) | |
Ending balance, shares | ||
Convertible Preferred Stock Series B 1 [Member] | ||
Beginning balance, shares | 467,728 | |
Conversion of Series B and B-1 Preferred Stock to Common Stock, shares | (467,728) | |
Ending balance, shares | ||
Convertible Preferred Stock Series C 1 [Member] | ||
Beginning balance, shares | 255,289 | |
Sercies C-1 Issue for a reduction in stock payables, shares | 5,413 | |
Dividend paid in Series B-1 Preferred Stock, shares | 5,626 | |
Conversion of Series B and B-1 Preferred Stock to Common Stock, shares | (266,328) | |
Ending balance, shares |
Noncontrolling Interest (Detail
Noncontrolling Interest (Details Narrative) - USD ($) | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Viva Wealth Fund I L L C [Member] | ||
Noncontrolling Interest [Line Items] | ||
Payments of Distributions to Affiliates | $ 593,087 | $ 0 |
Viva Wealth Fund I L L C [Member] | ||
Noncontrolling Interest [Line Items] | ||
Debt Conversion, Converted Instrument, Amount | $ 3,400,000 | $ 2,720,000 |
Debt Conversion, Converted Instrument, Shares Issued | 680 | 544 |
Share-Based Compensation & Wa_3
Share-Based Compensation & Warrants (Details - Assumptions) | 9 Months Ended |
Sep. 30, 2022 | |
Expected dividend yield | 0% |
Minimum [Member] | |
Risk-free interest rate | 0.24% |
Expected life of warrants | 3 years 3 months 29 days |
Expected volatility rate | 169% |
Maximum [Member] | |
Risk-free interest rate | 3.04% |
Expected life of warrants | 10 years |
Expected volatility rate | 273% |
Share-Based Compensation & Wa_4
Share-Based Compensation & Warrants (Details) - $ / shares | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Mar. 31, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Net of Forfeitures | 240,000 | ||||
Equity Option [Member] | |||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||
Shares outstanding - beginning | 650,000 | 650,000 | 650,000 | 650,000 | |
Weighted average exercise price - beginning | $ 12 | $ 12 | $ 12 | $ 12 | |
Weighted average contractural term | 6 years 11 months 4 days | 7 years 9 months 10 days | 7 years 6 months 10 days | 8 years 6 months 10 days | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Net of Forfeitures | 2,112,919 | ||||
Weighted average exercise price, granted | $ 2.24 | ||||
Weighted average remaining contractual life (years) | 6 years 7 months 6 days | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | (16,667) | ||||
Weighted average exercise price, exercised | $ 11.10 | ||||
Stock Issued During Period, Shares, Restricted Stock Award, Forfeited | (740,000) | ||||
Weighted average exercise price, forfeited | $ 10 | ||||
Shares outstanding - ending | 2,006,251 | 650,000 | 650,000 | 650,000 | |
Weighted average exercise price - ending | $ 2.56 | $ 12 | $ 12 | $ 12 | |
Shares exercisable | 1,175,059 | 144,167 | 180,000 | 47,083 | |
Weighted average exercise price - exercisable | $ 2.67 | $ 12 | $ 12 | $ 12 | |
Weighted average contractural term | 7 years 1 month 2 days | 7 years 3 days | 7 years 3 days | 6 years 3 months 7 days | |
Shares outstanding - ending | 2,006,251 | 650,000 | 650,000 | 650,000 |
Share-Based Compensation & Wa_5
Share-Based Compensation & Warrants (Details Narrative) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2018 | Dec. 31, 2021 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Option granted | 240,000 | |||
Options cancelled | 451,158 | |||
Share-based Payment Arrangement, Noncash Expense | $ 2,185,615 | $ 334,584 | ||
Warrants outstanding | 80,000 | 0 | ||
Warrants issued | 80,000 | |||
Warrants exercise price | $ 5.75 | |||
Public Offering [Member] | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Stock Issued During Period, Shares, New Issues | 1,600,000 | |||
Employees [Member] | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Option granted | 1,872,918 | |||
Share Stock Award [Member] | Employees [Member] | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Option granted | 16,667 | |||
Stock Options [Member] | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Share-based Payment Arrangement, Noncash Expense | $ 2,185,615 | $ 334,584 | ||
Stock Options [Member] | Employees [Member] | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Option granted | 166,667 | |||
Non Statutory Stock Options [Member] | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Share-based Payment Arrangement, Noncash Expense | $ 1,172,500 | $ 1,157,500 | ||
Non Statutory Stock Options [Member] | Board Of Directors [Member] | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Option granted | 133,333 | |||
Non Statutory Stock Options [Member] | Consultant [Member] | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Option granted | 333,334 |
Income Tax (Details Narrative)
Income Tax (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||||
Provision for income taxes | $ 0 | $ (723,911) | $ 800 | $ 0 | |
Effective tax rate | 9.18% | ||||
Net Operating losses | $ 14,300 |