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Item 5. Market for Registrant’s Common Equity

2022-04-15 compared with 2010-03-30 · 317 added, 60 removed, 1 unchanged (100% of the section changed)

Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Item 5 - Market for Registrant ’ s

Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Market Information

Through September 2, 2009, our common shares were not listed on any exchange and there was no established public trading market for our common stock.

On September 3, 2009, our stock began trading on the OTC Electronic Bulletin Board under the symbol “VIVK”.

The following table sets forth the bid prices quoted for our common stock during each quarter since our stock began trading, as reported by the OTC Bulletin Board.

The following quotations reflect inter-dealer prices, without retail mark-up, markdown or commission and may not necessarily represent actual transactions.

Fiscal Year ended December 31, 2009

Fourth Quarter

Third Quarter

Second Quarter

First Quarter

Holders of Common Stock

Our stockholder list contains the names of 79 registered stockholders of record of the Company’s Common Stock on March 26, 2010.

This number does not include beneficial owners of our common stock whose shares are held in the names of various dealers, clearing agencies, banks, brokers and other fiduciaries.

Dividends and Stock Repurchases

We have never paid cash dividends on our common stock and do not anticipate paying such dividends in the foreseeable future.

The payment of dividends, if any, will be determined by the Board of Directors in light of conditions then existing, including our financial condition and requirements, future prospects, restrictions in financing agreements, business conditions and other factors deemed relevant by the Board of Directors.

Purchases of Equity Securities

During the fiscal year ended December 31, 2009, we did not repurchase any of our securities.

Securities Authorized for Issuance Under Equity Compensation Plans

The information set forth in the table below regarding equity compensation plans (which include individual compensation arrangements) was determined as of December 31, 2009.

Plan Category

Number of securities to be issued upon exercise of outstanding options, warrants and rights

Weighted-average exercise price of outstanding options, warrants and rights

Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))

Equity compensation plans approved by security holders

Equity compensation plans not approved by security holders

In addition to the above, the Company has agreements with two consultants under which a portion of the consultants’ services are to be paid in shares of common stock.

One of the consultants earns 50,000 common shares per month over a period of six months for an aggregate of 300,000 shares.

At December 31, 2009, 50,000 shares had been earned but not issued yet and the remaining 250,000 shares are to be earned through May, 2010.

The fair market value of the earned and unissued shares is accrued in accounts payable in the accompanying consolidated balance sheet at December 31, 2009.

The other consultant is earning 5,000 common shares per month on a month-to-month basis.

Sales of Unregistered Securities

In connection with the Company’s conversion from a limited liability company to a corporation on April 30, 2008, the Company issued 44,862,500 unregistered shares of common stock to the founding member and the founding member forgave the $18,500 liability it was owed at December 31, 2007.

The Company also issued 291,000 shares to certain employees, based on their respective percentage interests held prior to conversion.

These shares were issued without registration under the Securities Act in reliance upon the exemption set forth in Section 4(2) of the Securities Act.

Between April 2008 and October 2008, we issued 133,000 shares of common stock to five accredited investors for an aggregate gross purchase price of $66,500.

Each investor executed a subscription agreement attesting that such investors qualified as an "accredited investor" within the meaning of Rule 501(a) of Regulation D under the Securities Act, and had such knowledge and experience in financial and business matters that they were capable of evaluating the merits and risks of the investment.

The securities, which were taken for investment purposes and were subject to appropriate transfer restrictions and restrictive legend, were issued without registration under the Securities Act in reliance upon the exemption set forth in Section 4(2) of the Securities Act or Regulation D.

These shares were subsequently registered in a registration statement that we filed on November 25, 2008.

On October 20, 2008, we issued 5,000,000 unregistered shares of our common stock under the Securities Act in reliance upon the exemption set forth in Section 4(2)of the Securities Act or Regulation D, along with a promissory note in the principal amount of $1,500,000 to stockholders of HealthAmerica, Inc., a Nevada corporation (HealthAmerica), in exchange for 25,000,000 shares of HealthAmerica common stock, representing approximately 84% of the outstanding shares of capital stock of HealthAmerica.

These shares were subsequently registered in a registration statement that we filed on November 25, 2008.

During 2009, we issued an aggregate of 70,000 unregistered shares for services.

The securities, which were taken for investment purposes and were subject to appropriate transfer restrictions and restrictive legend, were issued to accredited investors without registration under the Securities Act in reliance upon the exemption set forth in Section 4(2) of the Securities Act Regulation D or Rule 701.

The value of these services totaled $16,100.

Subsequent to the end of the fiscal year ended December 31, 2009, on February 4, 2010, the company sold a $50,000 convertible promissory note.

The note bears interest at 8% per annum, matures on November 4, 2010 and, at the holder’s option, may be converted into shares of common stock.

The conversion price is generally equal to 58% of the average of the lowest three closing bid price on the OTC Bulletin Board in the ten day trading period prior to the date of the notice of conversion.

This note also has anti-dilution provisions such that the conversion price may be reduced in the event the company issues or sells shares at a price below the conversion price.

The note may not be prepaid without the holder’s consent and is subject to a prepayment penalty.

The company has reserved 2,105,265 shares of common stock to provide for the issuance of shares upon the full conversion of this note.

The Note was sold to one accredited investor in a transaction exempt from registration under the Securities Act of 1933 (the “Securities Act”) pursuant to Section 4(2) and Regulation D.

On March 29, 2010, the Company sold a $60,000 convertible promissory note.

The note bears interest at 8% per annum, matures on December 26, 2010 and, at the holder’s option, may be converted into shares of common stock.

The conversion price is generally equal to 58% of the average of the lowest three closing bid price on the Over-the-Counter Bulletin Board in the ten day trading period prior to the date of the notice of conversion.

This note also has anti-dilution provisions such that the conversion price may be reduced in the event the Company issues or sells shares at a price below the conversion price.

The note may not be prepaid without the holder’s consent and is subject to a prepayment penalty.

The Company has reserved 3,154,980 shares of common stock to provide for the issuance of shares upon the full conversion of this note.

The Note was sold to one accredited investor in a transaction exempt from registration under the Securities Act of 1933 (the “Securities Act”) pursuant to Section 4(2) and Regulation D.

Selected Financial Data

Omitted pursuant to Item 301(c) of Regulation S-K.

Our Common Stock is listed on the Nasdaq Capital

Market under the symbol “VIVK.”

As of April 5, 2022, there were

15,038,619 shares of Common Stock outstanding held by approximately 570 holders of record (not including an indeterminate number of

beneficial holders of stock held in street name).

There were no warrants issued nor outstanding

as of April 5, 2022.

date, we have not paid any dividends on our common stock and do not anticipate paying any dividends in the foreseeable future.

The declaration

and payment of dividends on the common stock is at the discretion of our Board of Directors and will depend on, among other things, our

operating results, financial condition, capital requirements, contractual restrictions or such other factors as our Board of Directors

may deem relevant.

Securities Authorized for Issuance under Equity

Compensation Plans

As of December 31, 2021 the Company did not have

an equity compensation plan.

Recent Issuance of Unregistered Securities

The following sets forth information

regarding all unregistered securities sold by us in transactions that were exempt from the requirements of the Securities Act in the

last fiscal year.

Except where noted, all of the securities discussed in this Item 5 were all issued in reliance on the exemption

under Section 4(a)(2) of the Securities Act.

On January 13, 2021, the Company issued 33,667

shares of common stock at approximately $13.05 per share for $438,004 in services.

On January 28, 2021, the Company issued 3,333 shares of common stock

for a $36,000 reduction of liabilities pursuant to conversion of a promissory note at approximately $10.80 per share.

On April 16, 2021, the Company issued 24,850 shares

of common stock for a $217,800 reduction of liabilities pursuant to conversion of a promissory note at approximately $8.76 per share.

On April 22, 2021, the Company issued 16,667 shares

of common stock for a $225,000 payment to purchase a license at approximately $13.50 per share.

On May 24, 2021, the Company issued 986 shares

of common stock for a $11,000 reduction of liabilities pursuant to conversion of a promissory note at approximately $11,16 per share.

On August 5, 2021, the Company issued 19,841 shares

of common stock for an approximate $110,002 reduction of liabilities pursuant to conversion of a promissory note at approximately $5.55

On December 6, 2021, the Company issued 10,784

shares of common stock for an approximate $82,500 reduction of liabilities pursuant to conversion of a promissory note at approximately

$7.65 per share.

On December 15, 2021, the Company issued 8,818

shares of common stock for a $55,000 reduction of liabilities pursuant to conversion of a promissory note at approximately $6.24 per share.

From January 1, 2021 through December 31, 2021,

the Company issued 218,333 shares of common stock for $1,301,500 for the conversion of 216,916 shares of Series B Preferred Stock, at

an average price of approximately $6.00 per share.

From January 1, 2021 through December 31, 2021

the Company issued 473,578 shares of common stock for $3,550,176 for the conversion of 467,278 shares of Series B-1 Preferred Stock, at

$7.50 per share.

From January 1, 2021 through December 31, 2021

the Company issued 260,703 shares of common stock for $4,615,927 for the conversion of 266,328 shares of Series C-1 Preferred Stock, at

$17.70 per share.

Item 7 - Management ’ s Discussion and Analysis

of Financial Condition and Results of Operations

RESULTS OF OPERATIONS

The following discussion and analysis of our financial

condition and results of operations should be read in conjunction with our financial statements and related notes included elsewhere in

this Annual Report on 10-K.

Vivakor, Inc.

is a socially responsible operator,

acquirer and developer of clean energy technologies and environmental solutions, primarily focused on soil remediation.

We specialize

in the remediation of soil and the extraction of hydrocarbons, such as oil, from properties contaminated by or laden with heavy crude

oil and other hydrocarbon-based substances.

We are focused on the remediation of contaminated

soil and water resulting from either man-made spills or naturally occurring deposits of oil.

Our primary focus has been the remediation

of oil spills resulting from the Iraqi invasion of Kuwait and naturally occurring oil sands deposits in the Uinta basin located in Eastern

We plan to expand into other markets, both in Utah and globally, where we believe our technology and services will provide a distinct

competitive advantage over our competition.

Reclassifications

Certain reclassifications were made to prior years'

amounts to conform to the 2021 presentation.

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.

states and many countries have issued policies intended to stop or slow the further spread of the disease.

Our Kuwait operations were suspended to comply

with the social distancing measures implemented in Kuwait.

Our Utah operations were temporarily suspended from March through May 2020,

but have since resumed in full.

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.

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 in the long-term, 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.

For the years ended December 31, 2021 and

2020 we realized revenues of $1,088,428 and $1,457,781, respectively, representing a decrease of $369,353 or 25.34%.

The decrease in

revenue is primarily attributed to reopening of our Vernal site for quality control operations for the latter course of 2020 and

2021, thereby the Company diverted its resources to its primary business of manufacturing an operating RPCs for remediation and

preparing our Vernal site for production.

99% of our revenues were realized from precious metal sales from our business plan of

buying and selling precious metal commodities on the open market during the COVID-19 pandemic while our remediation operations were

shut down or delayed.

These precious metals having been acquired for immediate resale, with the Company acting as intermediary and

never keeping an inventory of precious metals.

We also realized revenues of $54,250 for the sale to a related party of our precious

metal concentrate produced from our own precious metal extraction operations.

We also received a payment of $6,000 pursuant to our

Kuwait contract for remediation services as described above, and we sold $7,735 of extracted test material from our RPCII located in

Cost of Revenue

Our cost of revenues consisted primarily of costs

associated with selling our precious metals on the open market and precious metal commodity broker fees.

For the years ended December 31, 2021 and 2020

costs of revenue were $1,050,676 and $1,356,378, respectively, representing a decrease of $305,702 or 22.54%.

The decrease in the cost

of revenue directly relates to costs associated with selling our precious metals on the open market and precious metal commodity broker

In 2021, the Company diverted its resources to its primary business of manufacturing an operating RPCs for remediation and preparing

our Vernal site for production.

The Company realized costs of revenue from precious metal sales from our business plan of buying and selling

precious metal commodities on the open market while our remediation operations were shut down or delayed during the COVID-19 pandemic.

Gross Profit and Gross Margin

For the years ended December 31, 2021 and 2020

we realized gross profit of $37,752 and $101,403, respectively, representing a decrease of $63,651 or 62.77%.

The gross profit decreased

in proportion to the revenue and costs of revenue related to the purchase and sale of precious metals as described above.

Our gross margin will continue to be affected

by a variety of factors that include the market prices of precious metals, the volume hydrocarbons produced by our RPC units, the number

of RPC units placed into production, and our ability to raise capital to continue to fund our operations and RPC unit manufacturing.

Operating Expenses

Our operating expenses consist primarily of marketing,

general and administrative expenses, bad debt expense, and amortization and depreciation expense.

Marketing expenses include marketing

fees of company representatives for marketing the business and is products and services as well as investor customer service.

and administrative expenses include professional services and legal fees associated with the costs for services in finance, accounting,

administrative activities and the formation and compliance of a public company.

Bad debt expense includes the expense associated with

assets that management analyses and estimates may be uncollectible.

Amortization and depreciation expense uses the useful life of the

asset to calculate the amortization or depreciation expense in accordance with accounting principles generally accepted in the United

States of America ("GAAP") and management’s judgment.

For the years ended December 31, 2021 and 2020,

we realized operating expenses of $6,963,668 and $4,949,795, which represents an increase of $2,013,873, or 40.69%.

Our operating expenses

increased due to increased professional service expenses in regards to audit, tax, and legal expense in relation to our registration statement,

its amendments, and in preparing for an underwritten public offering of our common stock, including our preparations for an uplist of

our common stock to a senior stock exchange.

We also organized and commenced operations of VWFI in the fourth quarter of 2020, which contributed

to the approximately $1.4 million in professional service expense, and operations, for startup and management of that entity in 2021.

Loss from Operations

For the years ended December 31, 2021 and 2020,

we realized a loss from operations of $6,925,916 and $4,848,392, which represents an increase of $2,077,524, or 42.85%.

The increase in

loss is attributed to the increase in operating expenses discussed above.

Interest income and expense

For the years ended December 31, 2021 and 2020,

we realized interest income of $3,312 and $35,344, which represents a decrease of $32,032, or 90.63%.

The decrease in interest income

is mainly attributed to the conversion of the Odyssey note receivable in September 2020, when we converted $809,578 of our note receivable

with Odyssey into 809,578 shares of Odyssey common stock pursuant to the terms of the note.

In August 2021, we also converted $81,768

of our note receivable with Scepter into 26,376,882 shares of Scepter common stock pursuant to the terms of the note.

For the years ended December 31, 2021 and 2020,

we realized interest expense of $501,598 and $86,162, which represents an increase of $415,436, or 482.16%.

The increase in interest expense

is mainly attributable to the Company entering into loans and notes payable to cover operating expenses during the COVID-19 pandemic throughout

2020 and 2021, and our commencement our VWFI $25,000,000 private placement offering to sell convertible promissory notes, which accrue

interest at 12% per annum, and convert to VWFI LLC units after six months.

The proceeds of the VWFI offering are used to manufacture RPCs.

VWFI has reached $6,250,000 in funding and has released the funding for construction of RPC Series A, and commenced fundraising for RPC

Approximately $487,000 in interest has accrued, which is made up of approximately $398,000 capitalized for the construction

RPCs, and $89,000 of interest expense, all of which is related to the VWFI offering for the year ended December 31, 2021.

Throughout 2020,

the Company entered into loans and notes payable to cover operating expenses during the COVID-19 pandemic, which temporarily suspended

our operations in Utah and continues to suspend our operations in Kuwait.

Interest of approximately $179,000 and amortized loan discounts

of approximately of $194,000 are attributed to these loans for the year ended December 31, 2021.

Unrealized gain (loss) on marketable securities

For the years ended December 31, 2021 and 2020,

the company reported an unrealized loss of $1,094,054, and an unrealized gain $2,614,338 on marketable securities, which represents a

decrease of $3,708,392, or 141.85%.

Our marketable securities in Odyssey Group International, Inc.

ODYY, OTC Markets) and Scepter

Holdings, Inc.

BRZL, OTC Markets) were considered to be traded on an active market and were accounted for at a fair value based

on the quoted prices in the active markets resulting in aggregate unrealized gains as noted above.

The increase is also attributed to

the fact that our marketable securities holdings in Scepter Holdings, Inc.

were accounted for under the equity method of accounting until

the fourth quarter of 2020 when the Company was diluted to an approximate 19% holding of Scepter on a diluted basis, and thereby these

securities were accounted for at a fair value based on the quoted prices in the active markets, which resulted in the Company recording

an unrealized loss on marketable securities of $1,297,594 and an unrealized gain of $2,670,536 for the years ended December 31, 2021

In January 2020, the Odyssey securities were considered to be traded on an active market and were accounted for at a fair value

based on the quoted prices in the active markets.

For the years ended December 31, 2021 and 2020

we recorded an unrealized gain of $203,540 and an unrealized loss of $56,198 on these marketable securities for the years ended

December 31, 2020.

In December 2021 we sold such shares of Odyssey in a private transaction for a purchase price of $860,491, reflecting

the market price at that time.

Gain (loss) on conversion of note receivable

For the years ended December 31, 2021 and 2020,

we recorded a gain of $87,044 and a loss of $121,428 on the conversion of notes receivable, which represents an increase of $208,472,

In August 2021 we converted $81,768 of our note receivable with Scepter into 26,376,882 shares of Scepter common stock pursuant

to the terms of the note at $0.0031 per share.

On the date of the conversion, the Scepter price per share on OTC Markets was $0.0062 per

share, which resulted in a $87,044 gain on the disposition of the note receivable.

In June 2020 we converted $809,578 of our note receivable

with Odyssey into 809,578 shares of Odyssey common stock pursuant to the terms of the note at $1.00 per share.

On the date of the conversion,

the Odyssey price per share on OTC Markets was $0.85 per share, which resulted in a $121,428 loss on the disposition of the note receivable.

Provision for income tax

The Company recorded

an income tax benefit of $1,050,207 and a tax provision of $466,964 for the years ended December 31, 2021 and 2020, respectively.

Company’s effective tax rate for 2021 and 2020 was 16.48% and -21.96%, which was the result of the benefit of book losses offset

by an additional valuation allowance on the net operating losses.

The following table sets forth the primary sources

and uses of cash and cash equivalents for the years ended December 31, 2021 and 2020 as presented below:

Net cash used in operating activities

$ (2,901,696 )

$ (1,753,655 )

Net cash used in investing activities

Net cash provided by financing activities

Liquidity and Capital Resources

We have historically suffered net losses and cumulative

negative cash flows from operations and, as of December 31, 2021 and 2020, we had an accumulated deficit of approximately $36 million

and $30.2 million.

As of December 31, 2021 and 2020, we had cash

and cash equivalents of $1,493,719 and $398,904, with $199,952 and $89,500 attributed to variable interest entities, respectively.

To date we have financed our operations primarily

through debt financing, private equity offerings and our working interest agreements, although on February 14, 2022, the Company closed

an underwritten public offering of 1,600,000 shares of common stock, at a public offering price of $5.00 per share, for aggregate

gross proceeds of $8.0 million, prior to deducting underwriting discounts, commissions, and other offering expenses.

The Company's

Common Stock began trading on the Nasdaq Capital Market under the symbol “VIVK”.

For the years ended December 31, 2021 and

2020, our net cash used in operating activities was mainly comprised of net effect of the consolidated net loss of $7,654,660 and

$2,871,369, we recognized a $1,051,006 (decrease) $466,164 (increase) related to our provision for income taxes as described above,

our depreciation and amortization of $1,462,492 and $1,562,662, and an increase in accounts payable of $38,127 and $517,931 related to the building of our second RPCs.

For the years ended December 31, 2021 and 2020, we were also able to issue

stock for services of $438,004 and $281,231, common stock options issued for services in relation to a consultant and the Board of

Director of $1,585,000 and $555,000, and stock-based compensation employees of $446,112 and $146,114 in lieu of using cash.

realized interest expense on loans and notes payable of $501,598 and $71,361 related to the Company entering into loans and notes

payable to cover operating expenses during the COVID-19 pandemic, and our commencement our VWFI $25,000,000 private placement

offering to sell convertible promissory notes, which accrue interest at 12% per annum, and convert to VWFI LLC units after six

For the years ended December 31, 2021 and 2020 we also realized a $87,044 gain and $121,428 loss on conversions of notes

receivable, and an unrealized loss of $1,094,054 and an unrealized gain of $2,614,338 on marketable securities as described

For the years ended December 31, 2021 and 2020,

our net cash used in investing activities was mainly attributed to our purchase of equipment of $4,236,276 and $1,197,922 related to the

manufacturing of our RPCs.

The Company also paid $265,000 for an additional license technology for piezo electric and energy harvesting

technologies for creating self-powered sensors for making smart roadways.

Our net cash provided by our financing activities

was mainly attributed to the net effect of the following events:

For the year ended December 31, 2021 and 2020,

we issued none and $624,907 noncontrolling units of RDM, and we also received proceeds of $8,033,407 and $944,673 related to the issuance

of convertible bridge notes and other loans.

For the nine months ended September 30, 2021, as included in the proceeds above, we obtained

Paycheck Protection Program loans for $295,745 that may be forgiven under the CARES Act, if we can

demonstrate that the proceeds from the loan were used for eligible expenses .

For the years ended December 31, 2021 and 2020,

we issued none and $624,907 noncontrolling units of RDM, and we received proceeds of $9,135,984 and $2,231,796 related to the issuance

of convertible bridge notes and other loans, including $8,825,000 in 2021 (of which $5,560,000 of

this debt has converted to VWFI LLC units) of convertible notes issued in relation to our VWFI $25,000,000 private placement offering

to sell convertible promissory notes, which accrue interest at 12% per annum, and convert to VWFI LLC units after six months.

year ended December 31, 2021 and 2020, as included in the proceeds above, we obtained Paycheck Protection Program loans for $295,745 and

$295,745 that may be forgiven under the CARES Act, if we can demonstrate that the proceeds from

the loan were used for eligible expenses .

We also obtained a loan from the Small Business Administration in the amount of $299,900

in May 2020, as included in the proceeds above.

Capitalized interest on construction in process

was $1,614,697 and $1,025,852 for the year ended December 31, 2021 and 2020.

There are no further existing firm obligations;

we anticipate further construction costs of approximately $1.6 million in connection with our construction in process of our RPC Series

A & B expansions;

and construction for each Nanosponge costs approximately $200,000, and we intend to manufacture for and add a Nanosponge

to our current and future RPCs.

Our ability to continue to access capital could

be affected adversely by various factors, including general market and other economic conditions, interest rates, the perception of our

potential future earnings and cash distributions, any unwillingness on the part of lenders to make loans to us and any deterioration in

the financial position of lenders that might make them unable to meet their obligations to us.

If we cannot raise capital through public

or private debt financings, equity offerings, or other means, our ability to grow our business may be negatively affected.

In such case,

we may need to suspend machine construction or further acquisitions until market conditions improve.

Contractual Obligations

Our contractual obligations as of December 31,

2021 are for operating lease liabilities for office and warehouse space, which leases end in 2024.

Operating lease obligations as of December

31, 2021 are as follows:

Interest Rate and Market Risk

Our financing arrangements are not subject to

variable interest rates of the prime rate or LIBOR.

Inflation generally will cause suppliers to increase

In connection with such rate increases, we may or may not be able to increase our pricing to consumers.

Inflation could cause

both our investment and cost of revenue to increase, thereby lowering our return on investment and depressing our gross margins.

Off Balance Sheet Arrangements

Critical Accounting Policies & Use of Estimates

Management’s Discussion and Analysis of

Financial Condition and Results of Operations is based upon our consolidated financial statements included in this report, which have

been prepared in accordance with GAAP.

For further information on the critical accounting policies see Note 3 of the Notes to the Consolidated

Financial Statements.

The preparation of these financial statements requires management to make estimates and judgments that affect the

reported amounts of assets, liabilities, sales and expenses, and related disclosure of contingent assets and liabilities.

their nature are based on judgments and available information.

Our estimates are made based upon historical factors, current circumstances

and the experience and judgment of management.

Assumptions and estimates are evaluated on an ongoing basis, and we may employ outside

experts to assist in evaluations.

Therefore, actual results could materially differ from those estimates under different assumptions and

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, lease

assets and liabilities, equity method investments, valuation of stock used to acquire assets, and derivatives.

Item 7A - Quantitative and Qualitative

Disclosures About Market Risk

Not applicable.

Item 8 - Financial Statements and Supplementary

The consolidated financial statements required

by this item begin on page F-1 of this Annual Report on Form 10-K and are incorporated herein by reference.

Item 9 - Changes in and Disagreements

with Accountants on Accounting and Financial Disclosures

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-K

Item 5. Market for Registrant’s Common Equity