What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2024-11-13 compared with 2024-08-26 · 213 added, 157 removed, 1018 unchanged (27% of the section changed)

2 unchanged sentences

Condensed Consolidated Balance Sheets (Unaudited)

September 30,

Current assets:

Accounts receivable, net

Inventory, net

Prepaids and other current assets

31 unchanged sentences

STOCKHOLDERS’ EQUITY

Preferred stock Series A, $ 0.001 par value, 50,000 shares authorized, 28,092 shares issued and outstanding as of June 30, 2024 and December 31, 2023

Preferred stock Series C, $ 0.001 per value, 5,200 shares authorized, 30 shares issued and outstanding as of June 30, 2024 and December 31, 2023.

Preferred stock Series A, $ 0.001 par value, 50,000 shares authorized, 28,092 shares issued and outstanding as of September 30, 2024 and December 31, 2023

Preferred stock Series C, $ 0.001 per value, 5,200 shares authorized, 30 shares issued and outstanding as of September 30, 2024 and December 31, 2023.

Liquidation preference of $ 1,033,950 .

Preferred stock Series G, $ 0.001 par value, 25,000 authorized, 5,272 shares issued and outstanding as of June 30, 2024 and December 31 2023.

Preferred stock Series G, $ 0.001 par value, 25,000 authorized, 5,272 shares issued and outstanding as of September 30, 2024 and December 31 2023.

Liquidation preference of nil.

Preferred stock Series H, $ 0.001 par value, 2,075 shares authorized, nil and 275 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively.

Common stock, $ 0.001 par value, 500,000,000 shares authorized, 200,033,220 and 119,301,921 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively

Preferred stock Series H, $ 0.001 par value, 2,075 shares authorized, nil and 275 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively.

Common stock, $ 0.001 par value, 500,000,000 shares authorized, 236,136,858 and 119,301,921 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively

Common stock to be issued on true-up of prior Series C Preferred stock conversions

4 unchanged sentences

( 140,350,893 )

Parent’s stockholders’ equity in Camber

Parent’s stockholders’ deficit in Camber

( 40,621,246 )

1 unchanged sentence

Non-controlling interest

TOTAL STOCKHOLDERS’ EQUITY

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

TOTAL STOCKHOLDERS’ EQUITY (DEFICIT)

( 31,662,829 )

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

2 unchanged sentences

Three months ended

Six months ended

Nine months ended

September 30,

Power generation units and parts

13 unchanged sentences

( 3,213,593 )

( 2,670,209 )

Other income (expense)

5 unchanged sentences

( 5,986,536 )

( 18,573,289 )

( 5,803,791 )

Loss on disposal of membership interests

Loss on extinguishment of debt

Goodwill impairment

( 34,860,411 )

Total other expense, net

1 unchanged sentence

( 7,333,960 )

( 58,553,758 )

( 7,572,090 )

Net loss before income taxes

8 unchanged sentences

( 10,785,683 )

Net loss attributable to non-controlling interest

Net income (loss) attributable to non-controlling interest

Net loss attributable to Camber Energy, Inc.

11 unchanged sentences

Three months ended

Six months ended

Nine months ended

September 30,

$ ( 34,771,681 )

8 unchanged sentences

( 10,664,188 )

Less comprehensive loss attributable to non-controlling interest

Loss attributable to non-controlling interest

Less comprehensive profit (loss) attributable to non-controlling interest

Profit (loss) attributable to non-controlling interest

Foreign currency translation adjustment attributable to non-controlling interest

Comprehensive loss attributable to non-controlling interest

Comprehensive profit (loss) attributable to non-controlling interest

Comprehensive loss attributable to Camber

6 unchanged sentences

Condensed Consolidated Statements of Cash Flows (Unaudited)

Six Months Ended

Nine Months Ended

September 30,

Cash flows from operating activities:

2 unchanged sentences

Adjustments to reconcile net loss to cash used in operating activities:

Goodwill impairment

Change in fair value of derivative liability

9 unchanged sentences

Accounts receivable

( 1,219,447 )

Prepaids and other current assets

5 unchanged sentences

( 1,632,651 )

( 2,290,511 )

Operating lease liabilities

( 1,255,595 )

( 1,002,295 )

Undistributed revenues and royalties

5 unchanged sentences

Acquisition of fixed assets

Net cash provided by (used in) investing activities

Cash acquired on Merger

Net cash provided by investing activities

Cash flows from financing activities:

4 unchanged sentences

Advances from bank credit facility

Proceeds from (repayment of) promissory notes, related parties

Proceeds from promissory notes, related parties, net

Net cash provided by financing activities

8 unchanged sentences

Common stock to be issued related to prior conversions of Series C Preferred Stock

Debt discount on modification of debt for conversion feature

Issuance of common stock on conversion of debt

4 unchanged sentences

Condensed Consolidated Statements of Changes in Stockholders ’ Equity (Unaudited)

For the six months ended June 30, 2024

For the nine months ended September 30, 2024

Preferred Stock

2 unchanged sentences

Preferred Stock

Common Stock to be Issued

Other Comprehensive

7 unchanged sentences

Common shares to be issued on true-up of Series C preferred stock

Common shares issued for services

Foreign currency translation adjustment

( 26,105,011 )

$ ( 26,351,568 )

Balances at March 31, 2024

$ 142,784,797

$ ( 246,675 )

$ ( 166,455,904 )

Common shares issued on true-up of Series C preferred stock

Common shares to be issued on true-up of Series C preferred stock

( 21,907,663 )

( 3,505,226 )

$ ( 3,505,226 )

Common shares issued on conversion of Series H preferred stock

1 unchanged sentence

Common shares issued on conversion of accrued interest

Common shares issued for services

Foreign currency translation adjustment

5 unchanged sentences

$ ( 169,181,677 )

For the six months ended June 30, 2023

Common shares issued on true-up of Series C preferred stock

Common shares to be issued on true-up of Series C preferred stock

( 36,103,638 )

( 5,776,582 )

$ ( 5,776,582 )

Foreign currency translation adjustment

( 34,267,479 )

$ ( 34,771,681 )

Balances at September 30, 2024

$ 155,913,262

$ ( 293,472 )

$ ( 203,449,156 )

$ ( 31,662,829 )

For the nine months ended September 30, 2023

Preferred Stock

10 unchanged sentences

$ ( 122,187,673 )

Shares issued on conversion of debt

Shares issued on exercise of warrants

Foreign currency translation adjustment

1 unchanged sentence

$ ( 1,632,327 )

Balances at March 31, 2023

$ 127,757,269

$ ( 363,131 )

$ ( 123,739,772 )

Shares issued on conversion of debt

Shares issues on exercise of warrants

Foreign currency translation adjustment

$ ( 1,276,012 )

Balances at June 30, 2023

2 unchanged sentences

$ ( 124,731,438 )

Reverse merger adjustment

( 4,428,916 )

$ ( 4,396,034 )

Shares issued on conversion of debt

Shares issued on conversion of Series H preferred stock

Shares issued on conversion of Series C preferred stock

Shares issued on true-up of Series C preferred stock

Foreign currency translation adjustment

( 8,175,563 )

$ ( 7,877,344 )

Balances at September 30, 2023

$ 134,072,578

$ ( 304,182 )

$ ( 132,907,001 )

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

23 unchanged sentences

Accordingly, these consolidated financial statements reflect the financial position, operating results, and cash flow of Viking up to the date of the Merger, and the combined financial position, operating results and cash flow of Viking and Camber from August 1, 2023.

As a result, the comparative financial information for the six months ended June 30, 2023 is that of Viking.

Doris continues to serve as President and Chief Executive Officer of the combined company, and the combined company continues to have its headquarters in Houston, Texas.

63 unchanged sentences

The technology is intended to increase public safety and reduce the risk of causing an incendiary event, and to be an integral component within grid hardening and stability initiatives by electric utilities to improve the resiliency and reliability of existing infrastructure.

A summary of the applicable patents, pending patents and/or patent applications associated with the intellectual property owned by Viking Sentinel and/or Viking Protection as at the date hereof is as follows:

Application #

Application Filed

Notice of Allowance Received

Patent Issued

Electric Transmission Line Ground Fault Prevention Methods Using Dual, High Sensitivity Monitoring

Electric Transmission Line Ground Fault Prevention Systems Using Dual, High Sensitivity Monitoring

Electric Transmission Line Ground Fault Prevention systems using dual parameter monitoring with high sensitivity relay devices in parallel with low sensitivity relay devices

Electric Transmission Line Ground Fault Prevention Methods Using Multi-Parameter High Sensitivity Monitoring

End of Line Protection with Trip-Signal Engaging

End of Line Protection with Blocking

International Application No.

PCT/US2024/010627

Electric Transmission Line Ground Fault Prevention Methods Using Multi-Parameter High Sensitivity Monitoring

Oil and Gas Properties:

20 unchanged sentences

The refund, net of fees, is included in prepaids and other current assets at December 31, 2023 and was included in the determination of the gain on disposal.

As of June 30, 2024, the Company did not hold any interest in producing oil and gas properties.

As of September 30, 2024, the Company did not hold any interest in producing oil and gas properties.

Going Concern

The Company’s condensed consolidated financial statements included herein have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

The Company generated a net loss of $( 29,172,828 ) for the six months ended June 30, 2024, as compared to a net loss of $( 2,908,339 ) for the six months ended June 30, 2023.

The loss for the six months ended June 30, 2024, was comprised of, among other things, certain non-cash items, including:

(i) change in fair value of derivative liability of $ 21,242,198 ;

(ii) amortization of debt discount of $ 1,727,351 ;

(iii) loss on extinguishment of debt of $ 811,132 ;

(iv) loss on disposal of membership interests of $ 755,506 ;

and (v) depreciation, depletion and amortization of $ 411,129 .

As of June 30, 2024, the Company had a stockholders’ equity of $ 3,110,322 , long-term debt, net of current, of $ 38,863,179 and a working capital deficiency of $ 14,988,313 .

The largest components of current liabilities creating this working capital deficiency is accrued interest on notes payable to Discover Growth Fund, LLC (“Discover”) of $ 5,811,159 , drawings by Simson-Maxwell against its bank credit facility of $ 4,381,161 , and a derivative liability of $ 3,202,691 .

The Company generated a net loss of $( 63,944,509 ) for the nine months ended September 30, 2024, as compared to a net loss of $( 10,785,683 ) for the nine months ended September 30, 2023.

The loss for the nine months ended September 30, 2024, was comprised of, among other things, certain non-cash items, including:

(i) goodwill impairment of $ 34,860,411 ;

(ii) change in fair value of derivative liability of $ 18,573,289 ;

(iii) amortization of debt discount of $ 2,538,362 ;

(iv) loss on extinguishment of debt of $ 811,132 ;

(v) loss on disposal of membership interests of $ 755,506 ;

and (vi) depreciation, depletion and amortization of $ 596,427 .

As of September 30, 2024, the Company had a stockholders’ deficit of $( 31,662,829 ), long-term debt, net of current, of $ 39,673,475 and a working capital deficiency of $ 14,221,385 .

The largest components of current liabilities creating this working capital deficiency is accrued interest on notes payable to Discover Growth Fund, LLC (“Discover”) of $ 6,194,664 and drawings by Simson-Maxwell against its bank credit facility of $ 4,193,122 .

These conditions raise substantial doubt regarding the Company’s ability to continue as a going concern.

22 unchanged sentences

The Company will adopt ASU 2023-07 for the annual reporting period ending December 31, 2024 and for interim reporting periods thereafter.

In June 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2023-05, Business Combinations (ASC Topic 805):

Joint Venture Formations, which provides guidance on accounting for joint ventures established through new entities.

The update mandates the application of the acquisition method of accounting for such transactions, requiring parties to recognize and measure identifiable assets and liabilities based on fair values at the acquisition date and establishes a measurement period for adjustments.

The amendments in this Update are effective prospectively for all joint venture formations with a formation date on or after January 1, 2025.

ASU 2023-05 will be effective for non-public entities for annual periods beginning after December 15, 2025, with early adoption permitted.

The Company is currently evaluating the implications of this update on its accounting practices for joint ventures and expects it will enhance consistency and transparency in financial reporting, without a material impact on its financial position or results of operations.

a) Basis of Presentation

32 unchanged sentences

inputs to the valuation methodology are unobservable inputs to measure fair value of assets and liabilities for which there is little, if any market activity at the measurement date, using reasonable inputs and assumptions based upon the best information at the time, to the extent that inputs are available without undue cost and effort.

As of June 30, 2024, the significant inputs to the Company’s derivative liability relative to the Company’s Series C Redeemable Convertible Preferred Stock (the “Series C Preferred Stock”) were Level 3 inputs.

Assets and liabilities measured at fair value as of and for the six months ended June 30, 2024 are classified below based on the three fair value hierarchy described above:

As of September 30, 2024, the significant inputs to the Company’s derivative liability relative to the Company’s Series C Redeemable Convertible Preferred Stock (the “Series C Preferred Stock”) were Level 3 inputs.

Assets and liabilities measured at fair value as of and for the nine months ended September 30, 2024 are classified below based on the three fair value hierarchy described above:

Identical Assets

Significant Unobservable

Total Gains (Losses) (six months ended June 30, 2024)

Total Gains (Losses) (nine months ended September 30, 2024)

Financial liabilities:

9 unchanged sentences

In establishing the required allowance, if any, management considers significant factors such as historical losses, current receivables ageing, the debtors’ current ability to pay its obligation to the Company and existing industry and economic data.

At June 30, 2024 and December 31, 2023, the Company has not recorded an allowance for credit losses related to oil and gas.

At September 30, 2024 and December 31, 2023, the Company has not recorded an allowance for credit losses related to oil and gas.

The Company extends credit to its power generation customers in the normal course of business.

3 unchanged sentences

On a periodic basis, the Company evaluates its accounts receivable and establishes an allowance for expected credit losses based upon management’s estimates that include a review of the history of past write-offs and collections and an analysis of current credit conditions.

At June 30, 2024 and December 31, 2023, the Company had a reserve for expected credit losses on power generation accounts receivable of $ 31,065 and $ 36,678 , respectively.

At September 30, 2024 and December 31, 2023, the Company had a reserve for expected credit losses on power generation accounts receivable of $ 31,444 and $ 36,678 , respectively.

The Company does not accrue interest on past due accounts receivable.

2 unchanged sentences

At the closing of each reporting period, the Company evaluates its inventory in order to adjust the inventory balance for obsolete and slow-moving items.

Inventory consisted of the following at June 30, 2024 and December 31, 2023:

Inventory consisted of the following at September 30, 2024 and December 31, 2023:

September 30,

Units and work in process

2 unchanged sentences

( 1,224,931 )

i) Oil and Gas Properties

The Company used the full cost method of accounting for its investment in oil and natural gas properties.

Under this method of accounting, all costs associated with acquisition, exploration and development of oil and gas reserves, including directly related overhead costs, are capitalized.

General and administrative costs related to production and general overhead are expensed as incurred.

All capitalized costs of oil and gas properties, including the estimated future costs to develop proved reserves, were amortized on the unit of production method using estimates of proved reserves.

Disposition of oil and gas properties were accounted for as a reduction of capitalized costs, with no gain or loss recognized unless such adjustment would significantly alter the relationship between capitalized costs and proved reserves of oil and gas, in which case the gain or loss is recognized in operations.

Unproved properties and major development projects were not amortized until proved reserves associated with the projects can be determined or until impairment occurs.

If the results of an assessment indicated that the properties are impaired, the amount of the impairment was included in loss from operations before income taxes.

j) Limitation on Capitalized Costs

Under the full-cost method of accounting, we were required, at the end of each reporting date, to perform a test to determine the limit on the book value of our oil and natural gas properties (the “Ceiling” test).

If the capitalized costs of our oil and natural gas properties, net of accumulated amortization and related deferred income taxes, exceed the Ceiling, this excess or impairment is charged to expense.

The expense may not be reversed in future periods, even though higher oil and natural gas prices may subsequently increase the Ceiling.

The Ceiling is defined as the sum of:

the present value, discounted at 10 percent, and assuming continuation of existing economic conditions, of 1) estimated future gross revenues from proved reserves, which is computed using oil and natural gas prices determined as the unweighted arithmetic average of the first-day-of-the-month price for each month within the 12-month hedging arrangements pursuant to SAB 103, less 2) estimated future expenditures (based on current costs) to be incurred in developing and producing the proved reserves, plus

the cost of properties not being amortized;

the lower of cost or estimated fair value of unproven properties included in the costs being amortized, net of

the related tax effects related to the difference between the book and tax basis of our oil and natural gas properties.

k) Oil and Gas Reserves

Reserve engineering is a subjective process that is dependent upon the quality of available data and the interpretation thereof, including evaluations and extrapolations of well flow rates and reservoir pressure.

Estimates by different engineers often vary, sometimes significantly.

In addition, physical factors such as the results of drilling, testing and production subsequent to the date of an estimate, as well as economic factors such as changes in product prices, may justify revision of such estimates.

Because proved reserves are required to be estimated using recent prices of the evaluation, estimated reserve quantities can be significantly impacted by changes in product prices.

l) Accounting for Leases

i) Accounting for Leases

The Company uses the right-of-use (“ROU”) model to account for leases where the Company is the lessee, which requires an entity to recognize a lease liability and ROU asset on the lease commencement date.

9 unchanged sentences

In addition, the Company elected not to recognize the right-of-use assets and liabilities for leases with lease terms of one year or less.

m) Business Combinations

j) Business Combinations

The Company allocates the fair value of purchase consideration to the tangible assets acquired, liabilities assumed, and intangible assets acquired based on their estimated fair values.

14 unchanged sentences

Impairment of goodwill is measured as the excess of the carrying amount of goodwill over the fair values of recognized and unrecognized assets and liabilities of the reporting unit.

o) Intangible Assets

Intangible assets include amounts related to the Company’s license agreement with ESG Clean Energy, LLC, and its investments in Viking Ozone, Viking Protection and Viking Sentinel.

l) Intangible Assets

Intangible assets include amounts related to the Company’s license agreement with ESG Clean Energy, LLC, and patents and intellectual property owned by Viking Ozone, Viking Protection and Viking Sentinel.

Additionally, as part of the acquisition of Simson-Maxwell, Viking identified intangible assets consisting of Simson-Maxwell’s customer relationships and its brand.

5 unchanged sentences

If the carrying amount is not recoverable, an impairment loss is recorded for the excess of the carrying value of the asset over its fair value.

p) Income (Loss) per Share

m) Income (Loss) per Share

Basic and diluted income (loss) per share calculations are calculated on the basis of the weighted average number of shares of the Company’s common stock outstanding during the year.

3 unchanged sentences

Common stock equivalents are excluded from the calculation when a loss is incurred as their effect would be anti-dilutive.

For the six months ended June 30, 2024 and 2023, there were approximately 3,321,457 and 18,337,721 common stock equivalents, respectively, that were omitted from the calculation of diluted income per share as they were anti-dilutive.

q) Revenue Recognition

Oil and Gas Revenues

Sales of crude oil, natural gas, and natural gas liquids (“NGLs”) have been included in revenue when production is sold to a customer in fulfillment of performance obligations under the terms of agreed contracts.

Performance obligations primarily comprise delivery of oil, gas, or NGLs at a delivery point, as negotiated within each contract.

Each barrel of oil, million BTU (“MMBtu”) of natural gas, or other unit of measure is separately identifiable and represents a distinct performance obligation to which the transaction price is allocated.

Performance obligations are satisfied at a point in time once control of the product has been transferred to the customer.

The Company considers a variety of facts and circumstances in assessing the point of control transfer, including but not limited to:

whether the purchaser can direct the use of the hydrocarbons, the transfer of significant risks and rewards, the Company’s right to payment, and transfer of legal title.

In each case, the time between delivery and when payments are due is not significant.

For the nine months ended September 30, 2024 and 2023, there were approximately 2,669,508 and 15,092,983 common stock equivalents, respectively, that were omitted from the calculation of diluted income per share as they were anti-dilutive.

n) Revenue Recognition

Power Generation Revenues

29 unchanged sentences

Most service and repairs are completed within one or two days.

The following table disaggregates Simson-Maxwell’s revenue by source for the three and six months ended June 30, 2024 and 2023:

The following table disaggregates Simson-Maxwell’s revenue by source for the three and nine months ended September 30, 2024 and 2023:

Three months ended

Six months ended

Nine months ended

September 30,

Power generation units

1 unchanged sentence

Service and repairs

r) Income Taxes

Oil and Gas Revenues

Performance obligations primarily comprise delivery of oil, gas, or NGLs at a delivery point, as negotiated within each contract.

Performance obligations are satisfied at a point in time once control of the product has been transferred to the customer.

o) Income Taxes

The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements.

6 unchanged sentences

The valuation allowance is then adjusted accordingly.

s) Stock-Based Compensation

p) Stock-Based Compensation

The Company may issue stock options to employees and stock options or warrants to non-employees in non-capital raising transactions for services and for financing costs.

9 unchanged sentences

The dividend yield assumption is based on historical patterns and future expectations for the Company dividends.

t) Impairment of Long-lived Assets

q) Impairment of Long-lived Assets

The Company, at least annually, is required to review its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable through the estimated undiscounted cash flows expected to result from the use and eventual disposition of the assets.

5 unchanged sentences

The Company estimates fair value of the assets based on certain assumptions such as budgets, internal projections, and other available information as considered necessary.

u) Accounting for Asset Retirement Obligations

r) Accounting for Asset Retirement Obligations

Asset retirement obligations (“ARO”) primarily represent the estimated present value of the amount the Company will incur to plug, abandon and remediate oil and gas properties at the projected end of their productive lives, in accordance with applicable federal, state and local laws.

1 unchanged sentence

The retirement obligation is recorded as a liability at its estimated present value as of the obligation’s inception, with an offsetting increase to proved properties.

The following table describes the changes in the Company’s asset retirement obligations for the six months ended June 30, 2024 and 2023:

Six Months Ended

The following table describes the changes in the Company’s asset retirement obligations for the nine months ended September 30, 2024 and 2023:

Nine Months Ended

September 30,

Asset retirement obligation – beginning

ARO recovered on disposal of membership interests

ARO acquired on the Merger

Accretion expense

Asset retirement obligation – ending

v) Derivative Liabilities

s) Derivative Liabilities

Convertible Preferred Shares

29 unchanged sentences

Instruments with later inception dates for which no shares remain to be allocated are reclassified to asset or liability.

w) Undistributed Revenues and Royalties

t) Undistributed Revenues and Royalties

The Company records a liability for cash collected from oil and gas sales that have not been distributed.

The amounts are distributed in accordance with the working interests of the respective owners.

x) Subsequent events

The Company has evaluated all subsequent events from June 30, 2024 through the date of filing of this report (see Note 16).

u) Subsequent events

The Company has evaluated all subsequent events from September 30, 2024 through the date of filing of this report (see Note 16).

Merger of Camber Energy, Inc.

23 unchanged sentences

Total Net Assets Acquired and Liabilities Assumed

The Company performs quarterly qualitative assessments of possible indicators of goodwill impairment;

no indicators were identified during the first two quarters of 2024.

However, during the three months ended September 30, 2024, the market price of the Company’s common stock declined significantly and its common stock was delisted from a national stock exchange.

The Company concluded that these factors were an indicator of goodwill impairment and therefore performed a quantitative assessment of the goodwill arising from the Merger.

The assessment used a combination of market prices and discounted cash flows to determine the fair value of the Company.

Based upon this assessment, the Company recorded a goodwill impairment charge of $34,860,411, representing an impairment of the entire goodwill balance, in the accompanying condensed consolidated statement of operations for the three months ended September 30, 2024.

Oil and Gas Properties

The following table summarizes the Company’s oil and gas activities by classification and geographical cost center for the six months ended June 30, 2024:

The following table summarizes the Company’s oil and gas activities by classification and geographical cost center for the nine months ended September 30, 2024:

September 30,

Proved developed producing oil and gas properties

United States cost center

$ ( 1,127,950 )

Accumulated depreciation, depletion and amortization

Proved developed producing oil and gas properties, net

$ ( 1,083,576 )

Undeveloped and non-producing oil and gas properties

3 unchanged sentences

Total Oil and Gas Properties, Net

During the six months ended June 30, 2024, the Company disposed of its working interests in its producing oil and gas properties (see Note 2).

$ ( 1,083,576 )

During the nine months ended September 30, 2024, the Company disposed of its working interests in its producing oil and gas properties (see Note 2).

Intangible Assets

13 unchanged sentences

If the continuing royalty percentage is adjusted jointly by the parties downward from the maximum of 15 %, then the minimum continuing royalty payments for any given year from the Trigger Date shall also be adjusted downward proportionally.

The Company recognized amortization expense of $ 153,924 for the six months ended June 30, 2024.

The Company recognized amortization expense of $ 231,732 for the nine months ended September 30, 2024.

The estimated future amortization expense for each of the next five years is $ 304,465 per year.

The ESG intangible asset consisted of the following at June 30, 2024 and December 31, 2023:

The ESG intangible asset consisted of the following at September 30, 2024 and December 31, 2023:

September 30,

ESG Clean Energy License

2 unchanged sentences

The Company allocated a portion of the purchase price of Simson-Maxwell to Customer Relationships with a fair value of $ 1,677,453 and an estimated useful life of 10 years, and the Simson-Maxwell Brand with a fair value of $ 2,230,673 and an indefinite useful life.

The Company recognized amortization expense for the Customer Relationship intangible of $ 83,643 for the six months ended June 30, 2024.

The Company recognized amortization expense for the Customer Relationship intangible of $ 125,924 for the nine months ended September 30, 2024.

The estimated future amortization expense for each of the next five years is $ 167,745 per year.

The Company periodically reviews the fair value of the Customer Relationships and Brand to determine if an impairment charge should be recognized.

The Company did not record any impairment for the six-month period ended June 30, 2024.

For the year ended December 31, 2023, the Company recorded an impairment charge of $ 311,837 related to the Simmax Brand and $ 357,873 related to Customer Relationships, driven by lower actual and forecast revenue growth as compared to the date of acquisition.

The Other intangibles – Simson-Maxwell consisted of the following at June 30, 2024 and December 31, 2023:

The Company did not record any impairment for the nine-month period ended September 30, 2024.

For the year ended December 31, 2023, the Company recorded an impairment charge of $ 311,837 related to the Simson-Maxwell Brand and $ 357,873 related to Customer Relationships, driven by lower actual and forecast revenue growth as compared to the date of acquisition.

The Other intangibles – Simson-Maxwell consisted of the following at September 30, 2024 and December 31, 2023:

September 30,

Simson-Maxwell Brand

19 unchanged sentences

Purchase Price Allocation:

Intangible asset - IP

Intangible asset – Patents and Intellectual Property

Non-controlling interest

12 unchanged sentences

Purchase Price Allocation:

Intangible asset - IP

Intangible asset – Patents and Intellectual Property

Non-controlling interest

28 unchanged sentences

Purchase Price Allocation:

Intangible asset - IP

Intangible asset – Patents and Intellectual Property

Non-controlling interest

8 unchanged sentences

The Company has determined that it is the primary beneficiary of three VIEs, Viking Ozone, Viking Sentinel and Viking Protection, and consolidates the financial results of these entities, as follows:

Intangible asset - IP

Intangible asset - Patents and Intellectual Property

Non-controlling interest

6 unchanged sentences

The Company’s CEO and Director, James Doris, renders professional services to the Company through AGD Advisory Group, Inc., an affiliate of Mr.

During the six months ended June 30, 2024 and 2023, the Company paid or accrued $ 300,000 and $ 180,000 , respectively, in fees to AGD Advisory Group, Inc.

As of June 30, 2024 and December 31, 2023, the total amount due to AGD Advisory Group, Inc.

During the nine months ended September 30, 2024 and 2023, the Company paid or accrued $ 450,000 and $ 310,000 respectively, in fees to AGD Advisory Group, Inc.

As of September 30, 2024 and December 31, 2023, the total amount due to AGD Advisory Group, Inc.

was $ 810,000 and $ 630,000 , respectively, and is included in accounts payable.

During the six months ended June 30, 2024, the Company’s CEO and Director, James Doris, advanced $ 190,830 to Viking Ozone Technology, LLC related to the manufacture of a medical waste unit.

During the nine months ended September 30, 2024, the Company’s CEO and Director, James Doris, advanced $ 190,830 to Viking Ozone Technology, LLC related to the manufacture of a medical waste unit.

This advance is non-interest bearing with no fixed repayment terms and is included in “Due to related parties”.

The Company’s CFO, John McVicar, renders professional services to the Company through 1508586 Alberta Ltd., an affiliate of Mr.

During the six months ended June 30, 2024 and 2023, the Company paid or accrued $ 180,000 and $ 120,000 , respectively, in fees to 1508586 Alberta Ltd.

During the nine months ended September 30, 2024 and 2023, the Company paid or accrued $ 270,000 and $ 190,000 , respectively, in fees to 1508586 Alberta Ltd.

Simson-Maxwell

1 unchanged sentence

Viking assumed these balances and loan agreements in connection with the acquisition.

The balance of amounts due to and due from related parties as of June 30, 2024 and December 31, 2023 are as follows:

The balance of amounts due to and due from related parties as of September 30, 2024 and December 31, 2023 are as follows:

related party

1 unchanged sentence

Net due (to) from

June 30, 2024

September 30, 2024

& majority owner

13 unchanged sentences

Adco Power Ltd., an industrial, electrical and mechanical construction company, is a wholly owned subsidiary of Simmax Corp., and conducts business with Simson-Maxwell.

The notes payable to related parties as of June 30, 2024 and December 31, 2023 are as follows:

The notes payable to related parties as of September 30, 2024 and December 31, 2023 are as follows:

September 30,

Total notes payable to related parties

2 unchanged sentences

Noncontrolling Interests

The following discloses the effects of changes in the Company’s ownership interest in Simson-Maxwell, and on the Company’s equity for six months ended June 30, 2024:

The following discloses the effects of changes in the Company’s ownership interest in Simson-Maxwell, and on the Company’s equity for nine months ended September 30, 2024:

Noncontrolling interest - January 1, 2024

Net gain (loss) attributable to noncontrolling interest

Noncontrolling interest – June 30, 2024

The following discloses the effects of the Company’s ownership interest in Viking Ozone, Viking Sentinel and Viking Protection in the aggregate, and on the Company’s equity for six months ended June 30, 2024:

Net loss attributable to noncontrolling interest

Noncontrolling interest – September 30, 2024

Noncontrolling interest - January 1, 2024

Net gain (loss) attributable to noncontrolling interest

Noncontrolling interest – June 30, 2024

Net loss attributable to noncontrolling interest

Noncontrolling interest – September 30, 2024

Long-Term Debt and Other Short-Term Borrowings

Long term debt and other short-term borrowings consisted of the following at June 30, 2024 and December 31, 2023:

Long term debt and other short-term borrowings consisted of the following at September 30, 2024 and December 31, 2023:

September 30,

Long-term debt:

1 unchanged sentence

The note bears interest at a rate equal to the Wall Street Journal Prime Rate (3.25%) as of the effective date and is secured by lien on substantially all of the Company’s assets.

The balance shown is net of unamortized debt discount of $8,110,475 and $9,714,868 at June 30, 2024 and December 31, 2023, respectively.

The balance shown is net of unamortized debt discount of $7,299,464 and $9,714,868 at September 30, 2024 and December 31, 2023, respectively.

Note payable to Discover pursuant to a 10.0% Secured Promissory Note dated April 23, 2021 in the original amount of $2,500,000 with interest and principal due at maturity on January 1, 2027.

14 unchanged sentences

The Company recorded a loss on early extinguishment of $35,402 related to these conversions.

During the six-month period ended June 30, 2024, the Company adjusted the conversion price of three of the remaining notes to $0.16 and the fourth to $0.163.

During the nine-month period ended September 30, 2024, the Company adjusted the conversion price of three of the remaining notes to $0.16 and the fourth to $0.163.

The Buyer then converted the four remaining notes in exchange for 19,907,976 shares of the Company’s common stock.

11 unchanged sentences

Principal maturities of long-term debt for the next five years and thereafter are as follows:

Twelve-month period ended June 30,

Twelve-month period ended September 30,

Unamortized Discount

2 unchanged sentences

Advance from FK Venture LLC

During the six-month period ended June 30, 2024, FK Venture LLC advanced $ 1,200,000 to the Company’s wholly owned subsidiary, Viking.

During the nine-month period ended September 30, 2024, FK Venture LLC advanced $ 1,200,000 to the Company’s wholly owned subsidiary, Viking.

The terms of this advance have not been finalized.

The amount has been included in Accrued Expenses and Other Current Liabilities at June 30, 2024.

The amount has been included in Accrued Expenses and Other Current Liabilities at September 30, 2024.

Bank Credit Facility

2 unchanged sentences

The Company is required to make monthly principal payments in the amount of CAD $55,555 on the fixed loan portion commencing on October 31, 2024.

The balance outstanding under this credit facility is CAD $5,993,718 ($ 4,381,161 ) and CAD $4,457,947 ($ 3,365,995 ) as of June 30, 2024 and December 31, 2023, respectively.

The balance outstanding under this credit facility is CAD $5,667,386 ($ 4,193,122 ) and CAD $4,457,947 ($ 3,365,995 ) as of September 30, 2024 and December 31, 2023, respectively.

Derivative Liability

25 unchanged sentences

This reduced the value of derivative liability associated with True-Up shares to zero, and the fair value of the True-Up share obligation at March 25, 2024 was reclassified to Stockholders’ Equity as common shares to be issued.

Activities for Series C Preferred Stock derivative liability during the six months ended June 30, 2024 was as follows:

Activities for Series C Preferred Stock derivative liability during the nine months ended September 30, 2024 was as follows:

September 30, 2024

Carrying amount at beginning of year

27 unchanged sentences

The Company is authorized to issue 500,000,000 shares of Common Stock, par value $ 0.001 per share.

During the six months ended June 30, 2024, the Company issued a total of 80,731,299 shares of common stock, as follows:

During the nine months ended September 30, 2024, the Company issued a total of 116,834,937 shares of common stock, as follows:

A total of 89,149,679 True-Up shares related to prior conversions of Series C Preferred Stock as a result of the continuation of the Measurement Period (as defined in the Series C COD with respect to such Series C Preferred Stock) associated with such conversions and a decline in the price of the Company’s shares of common stock within the Measurement Period.

47 unchanged sentences

In addition, pursuant to the Agreement, (i) beginning on February 15, 2024 and thereafter, the Company agreed to pay at least fifty percent of the net proceeds received by the Company in connection with any registered or unregistered offering of equity or debt securities of the Company toward repayment of any outstanding Notes, and (ii) Antilles rescinded its prior notice to increase the beneficial ownership limitation to 9.99 %, such that the limitation is restored to 4.99 % effective five Business Days from the date of the Agreement.

As of June 30, 2024, Antilles held 30 shares of Series C Preferred Stock.

As of September 30, 2024, Antilles held 30 shares of Series C Preferred Stock.

The Series C Preferred Stock is convertible into a substantial number of the Company’s shares of common stock which could result in significant dilution of the Company’s existing shareholders.

If the outstanding Series C Preferred Stock were converted as of June 30, 2024, the Company estimates that the following shares of common stock would be required to be issued to satisfy the conversion of shares of the Series C Preferred Stock:

Estimated number of shares issuable for conversion at $ 162.50 per share at June 30, 2024

If the outstanding Series C Preferred Stock were converted as of September 30, 2024, the Company estimates that the following shares of common stock would be required to be issued to satisfy the conversion of shares of the Series C Preferred Stock:

September 30, 2024*

Estimated number of shares issuable for conversion at $ 162.50 per share at September 30, 2024

Estimated number of shares of common stock required to satisfy Conversion Premium using VWAP at period end

3 unchanged sentences

The fair value of these shares on March 25, 2024 was determined to be $ 16,253,757 and was included in Stockholders’ Equity as common stock to be issued at March 31, 2024.

At June 30, 2024, the number of remaining True-Up shares due from prior conversions was 79,678,317 .

At September 30, 2024, the number of remaining True-Up shares due from prior conversions was 43,574,679 .

(iii) Series G Redeemable Convertible Preferred Stock

25 unchanged sentences

The Investor may not convert any of the remaining shares of Series G Preferred Stock associated with any remaining Note into shares of common stock or sell any of the underlying shares of common stock unless that Note is paid in full by the Investor, and the Company may redeem the shares of Series G Preferred Stock associated with each Note by paying the Investor $ 1,375,000 as full consideration for such redemption.

As of June 30, 2024, none of the outstanding Notes had been paid in full and thus the underlying shares were not convertible.

As of September 30, 2024, none of the outstanding Notes had been paid in full and thus the underlying shares were not convertible.

(iv) Series H Convertible Preferred Stock

2 unchanged sentences

During the year ended December 31, 2023, Jedda Holdings converted 200 of the 475 shares of Series H Preferred Stock into 3,333,333 shares of Common Stock.

During the six months ended June 30, 2024, Jedda Holdings converted the remaining 275 shares of Series H Preferred Stock into 4,583,333 shares of Common Stock.

The following table represents stock warrant activity as of and for the six months ended June 30, 2024:

During the nine months ended September 30, 2024, Jedda Holdings converted the remaining 275 shares of Series H Preferred Stock into 4,583,333 shares of Common Stock.

The following table represents stock warrant activity as of and for the nine months ended September 30, 2024:

Contractual Life

1 unchanged sentence

Forfeited/expired/cancelled

Warrants Outstanding – June 30, 2024

Outstanding Exercisable – June 30, 2024

( 1,049,727 )

Warrants Outstanding – September 30, 2024

Outstanding Exercisable – September 30, 2024

Commitments and Contingencies

4 unchanged sentences

Operating lease expense is recognized on a straight-line base over each of the lease terms.

Payments due in each of the next five years and thereafter at June 30, 2024 under these leases are as follows:

Payments due in each of the next five years and thereafter at September 30, 2024 under these leases are as follows:

Vehicle and Equipment

2 unchanged sentences

Present value of remaining lease payments

Operating lease expense for these leases was $ 914,051 and $ 670,311 for the six months ended June 30, 2024 and 2023, respectively.

Operating lease expense for these leases was $ 1,187,035 and $ 918,655 for the nine months ended September 30, 2024 and 2023, respectively.

Legal matters

6 unchanged sentences

The complaint alleges breaches of fiduciary duty in connection with the merger between Viking and the Company and seeks to recover damages for the alleged breaches.

The defendants deny the allegations and filed a motion to dismiss the case on April 26, 2024, which remains pending.

The defendants deny the allegations and filed a motion to dismiss (“MTD”) the case on April 26, 2024.

The MTD hearing was held on August 30, 2024 and the Court’s decision with respect to such hearing remains pending.

Shareholder-Related Litigation

18 unchanged sentences

On July 2, 2024, the Court issued an order providing for preliminary approval of the Stipulation and Settlement and set a final approval hearing for September 12, 2024.

At June 30, 2024, the Company recorded an accrued liability in respect of the proposed settlement and a receivable related to the insurance proceeds in the amount of $ 700,000 , the minimum amount specified in the Stipulation and Settlement.

On or about September 17, 2024, the Court issued a final order and judgement approving the Stipulation and Settlement and awarded fees payable to the Plaintiff’s legal counsel in the amount of $ 1,200,000 , which will be paid by the Company’s insurer.

Payment of the settlement amount remains outstanding at September 30, 2024, and the Company has therefore recorded an accrued liability in respect of the settlement and a receivable related to the insurance proceeds.

Maranatha Oil Matter

32 unchanged sentences

We evaluate segment performance based on revenue and operating income (loss).

Information related to our reportable segments and our consolidated results for the six months ended June 30, 2024 is presented below.

Six Months Ended June 30, 2024

Information related to our reportable segments and our consolidated results for the nine months ended September 30, 2024 is presented below.

Nine Months Ended September 30, 2024

Power Generation

15 unchanged sentences

Total Consolidated Assets

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

Power Generation

11 unchanged sentences

$ ( 3,213,593 )

$ ( 2,670,209 )

Segment assets

2 unchanged sentences

Subsequent Events

On or about October 23, 2024, the Company and James Doris entered into a Second Amendment to Common Stock Warrant Agreement pursuant to which the exercise price of Mr.

Doris’ outstanding warrants (i.e.

right to purchase 1,666,667 shares of common stock of the Company) was increased from $ 0.009 per share to $ 1.00 per share.

Series C Preferred Stock

Between July 1 and August 23, 2024, the Company issued 29,103,638 True-Up Shares to Antilles in connection with Delivery Notices submitted by Antilles.

Between October 1 and November 11, 2024, the Company issued 7,500,000 True-Up Shares to Antilles in connection with Delivery Notices submitted by Antilles.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements