Vivakor, Inc. 10-K

Item 5 - Market for Registrant ’ s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our Common Stock is listed on the Nasdaq Capital Market under the symbol “VIVK.” Holders As of April 15, 2026, there were 2,068,041 shares of Common Stock outstanding held by approximately 535 holders of record (not including an indeterminate number of beneficial holders of stock held in street name). Warrants There are warrants to purchase 400 shares of common stock issued and outstanding as of April 15, 2026. Preferred Stock . We are authorized to issue 15,000,000 shares of preferred stock, par value $0.001. We currently have one series of preferred stock designated, namely our Series A Preferred Stock. Our preferred stock is “blank check preferred” whereby our Board of Directors may create a series of preferred stock and set the rights and preferences of such preferred stock, without further shareholder approval. The availability or issuance of preferred shares in the future could delay, defer, discourage or prevent a change in control. We previously had five series of preferred stock designated entitled Series A Preferred Stock, Series B Preferred Stock, Series B-1 Preferred Stock, Series C Preferred Stock and Series C-1 Preferred Stock. On February 6, 2025 we filed a Certificate of Amendment to our Articles of Incorporation (deemed to be effective for accounting purposes as of October 1, 2024) which withdrew those prior series of preferred stock. Our current Series A Preferred Stock was created on February 14, 2025 and has 150,000 shares authorized with 107,789 shares of outstanding, which shares were deemed to be issued as of October 1, 2024 for accounting purposes. Our Series A Preferred Stock has a stated value of $1,000 per share, as an annual dividend rate equal to six percent (6%) of the stated value per share, with such dividends payable in shares of our common stock, has liquidation preference, has voting rights on an “as-converted” basis, and are only convertible into shares of common stock at the decision of the company, subject to certain ownership limitations. Dividends To 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. Our Series A Preferred Stock earns an annual dividend of 6% of the stated value of the stock, which dividend is paid in equal quarterly installments in shares of our common stock unless such issuance would cause the holder of the Series A Preferred Stock to exceed certain beneficial ownership limitations, and such a situation the dividend will accrue until such time as the shares are able to be issued. Securities Authorized for Issuance under Equity Compensation Plans On November 10, 2023, our 2023 Equity and Incentive Plan went effective. The plan was approved by our Board of Directors and by the holders of a majority of our common stock. The Plan’s number of authorized shares is 200,000. As of April 15, 2026, no options had been granted or exercised under the Plan. As of April 15, 2026, there were stock awards granted of 22,246 shares of common stock under the plan. As of April 15, 2026, the Plan had 22,246 vested shares and 22,246 non-vested shares underlying the stock awards. We have not issued any other type of equity awards under the Plan. 28 On February 14, 2022, our 2021 Equity and Incentive Plan went effective. The plan was approved by our Board of Directors. The Plan’s number of authorized shares is 10,000. As of April 15, 2026, there were stock options and awards granted to acquire 8,345 shares of common stock at a weighted exercise price of $394 per share under the plan. As of April 15, 2026, the Plan had 8,609 vested shares and no non-vested shares underlying the stock options. As of April 15, 2026, no options had been exercised under the Plan. We have not issued any other type of equity awards under the Plan. The stock options issued under the Plan are held by certain of our current and former executive officers. 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. 2025 On July 9, 2025, we entered into a Second Amendment to Loan Agreement and Registration Rights Agreement (the “Amendment”), and an Additional Junior Secured Convertible Note (the “Additional Note”, together with the Amendment, the “New Loan Documents”), under which we agreed to issue J.J. Astor & Co. (the “Lender”) the Note in the principal amount of $5,940,000. Under the New Loan Documents, we will receive net proceeds of $971,025.65, with the remainder of the principal amount going to (a) a $176,000 origination fee, (b) an aggregate of $3,232,974.35 (the “Holdback Amounts”) representing (i) a $891,000 holdback amount to be applied to pay the first six Weekly Installment Payments when due under the Additional Note (hereinafter defined), (ii) $1,395,540.35 to be applied to pay the seven past due Weekly Installment Payments under the Initial Note, plus accrued interest thereon, and (iii) $946,434 to secure and cover the payment of the next six Weekly Installment Payments due under the Initial Note, (c) $20,000 to pay Lender’s legal fees, and (d) and original issuance discount of $1,540,000. The Note is payable over forty equal weekly installments of $148,500, which may be paid in cash or, at the option of the Company once an appli registration statement is effective, in free trading shares of its common stock issued at a twenty percent (20%) discount to the lower of either the previous day’s closing price or the average of the four lowest volume-weighted average prices during the prior twenty (20) trading days. The Note does not bear interest unless in default and is subject to mandatory prepayment upon the receipt of proceeds from identified sales of equity interests in the Company and/or the receipt of certain extraordinary cash payments. In the event we default on the terms of the Initial Note or the Additional Note, the conversion price under the notes is a 50% discount to discount to the lower of either the previous day’s closing price or the average of the four lowest volume-weighted average prices during the prior twenty (20) trading days. The lender is secured by a junior lien in all assets of the Company, subject to exceptions for existing debt covenants of the Company. The Company reserved 75,000 shares of its common stock for issuance in connection with a conversion under the Additional Note and the Company agreed to issue the Lender 750 shares of its common stock as additional consideration for the loan (the “Commitment Shares”). We received the funds under the New Loan Documents on July 15, 2025. Beginning in September 2025 and continuing through November 18, 2025, the Lender delivered multiple conversion notices pursuant to the terms of the Initial Note. In aggregate, the Lender converted $4.05 million of outstanding principal into approximately 172,500 shares of the Company’s common stock at contractually discounted conversion prices. Each issuance was made without a Rule 144 restrictive legend based on legal opinions obtained by the Company and its transfer agent. On October 2, 2025, we issued the Lender the 1,250 shares due as Commitment Shares under the Initial Note. These shares were issued as restricted stock with a standard Rule 144 restrictive legend. Between June 6, 2025 and June 9, 2025, we issued convertible promissory notes (the “Notes”), to seven non-affiliated accredited investors (the “Holders”), in the aggregate principal amount of $5,117,647.06 in connection with a Securities Purchase Agreement entered into by and between the Company and the Holders (the “SPA”). Under the terms of the SPA and the Notes, we received $4,350,000 prior to deducting placement agent fees of $391,500, Holders attorney’s fees of $20,000 and escrow fees of $5,000. The Notes matures twelve months from the date of issuance, have a 15% original issuance discount, have a one-time ten percent (10%) interest charge applied at the issuance date, and is convertible at eighty percent (80%) of the lower of (a) the closing price of the Company’s common stock as traded on either the Nasdaq or the New York Stock Exchange or the NYSE Amex Exchange (as applicable) on the trading day immediately prior to the date a notice of conversion is submitted in writing to the Company under the Note (each a “Notice Date”), or (b) the average of the four lowest VWAPS over the twenty (20) trading days prior to the applicable Notice Date. In connection with the issuance of the Notes, we issued the Holders 3,263 shares of our common stock as additional incentive to enter into the SPA and the Notes. In the fourth quarter of 2025 through the first quarter of 2026, the Holders submitted numerous conversion notices converting $3,178,689.61 of the principal and interest due under the Notes into approximately 958,232 shares or our common stock. 29 On May 20, 2025, we issued an aggregate of 8,825 shares of our restricted common stock for three months of dividends to the holders of our Series A Preferred Stock. Of those shares, 6,922 were issued to Jorgan Development, LLC and 70 were issued to JBAH Holdings, LLC, both of which are controlled by James Ballengee, our Chief Executive Officer. Between May 14, 2025 and May 28, 2025, we issued convertible promissory notes (the “CT Notes”), to several accredited investors (the “CT Holders”), in the aggregate principal amount of $747,500 in connection with a Securities Purchase Agreement entered into by and between the Company and the Holders (the “CT SPA”). Under the terms of the CT SPA and the CT Notes, we received $650,000, the CT Notes mature twelve months from the date of issuance, have a 15% original issuance discount, have a one-time ten percent (10%) interest charge applied at the issuance date, and are convertible at eighty percent (80%) of the lower of (a) the closing price of the Company’s common stock as traded on either the Nasdaq or the New York Stock Exchange or the NYSE Amex Exchange (as applicable) on the trading day immediately prior to the date a notice of conversion is submitted in writing to the Company under the CT Notes (each a “Notice Date”), or (b) the average of the four lowest VWAPS over the twenty (20) trading days prior to the applicable Notice Date. In connection with the issuances of the CT Notes, we issued the Holders 438 shares of our common stock as additional incentive to enter into the SPA and the Notes. In the fourth quarter of 2025, the CT Holders converted $869,954.48 of principal and interest due under the CT Notes into approximately 71,146 shares of our common stock. On April 11, 2025, we issued Cedarview Capital Management LLC, and its assignees, 1,500 shares of our restricted common stock. The shares were issued pursuant to the terms of a Side Letter with an effective date of April 9, 2025, which modified and extended the repayment terms of the Secured Promissory Note dated October 31, 2024 held by Cedarview. On April 11, 2025, we issued 1,750 shares of our restricted common stock to Justin Ellis pursuant to a conversion notice we received from Mr. Ellis notifying us of his desire to convert $350,000 owed to him under that certain Convertible Promissory Note dated July 7, 2024. On April 11, 2025, we issued an aggregate of 6,493 shares of our restricted common stock for four months of dividends to the holders of our Series A Preferred Stock. Of those shares, 4,421 were issued to Jorgan Development, LLC and 45 were issued to JBAH Holdings, LLC, both of which are controlled by James Ballengee, our Chief Executive Officer. On April 11, 2025, we issued 107,789 shares of our Series A Preferred Stock to the sellers, or their assignees, in the Endeavor Entities transaction. These shares represented the preferred stock portion of the purchase price for the transaction, including any post-closing adjustments. Of these shares, 425 shares went to Jorgan Development, LLC and 5 shares went to JBAH Holdings, LLC, both of which are controlled by James Ballengee, our Chief Executive Officer. The Series A Preferred Stock has voting rights on an “as converted basis” and is only convertible by the Company. The shares do have a 6% annual dividend, based on the $1,000 stated per share value of the Series A Preferred Stock, payable in shares of our common stock. On February 26, 2025, we issued Tysadco Partners, LLC 698 restricted shares for payment of $180,000 in outstanding invoices. On February 26, 2025, we issued the Sellers in the acquisition of the Endeavor Entities transaction an additional 24,291 shares of our common stock and on April 11, 2025, 539 shares of our Series A Preferred Stock as part of the consideration, all of which were considered to have been issued as of December 31, 2024 for accounting purposes. On February 10, 2025, we entered into an Amendment No. 1 to our Employment Agreement with Mr. Les Patterson, our Vice President, Operations & Construction. Mr. Patterson’s Employment Agreement misstated Mr. Patterson’s annual equity compensation, which was agreed to be annual equity compensation equal to not less than One Hundred Thousand and No/100s U.S. Dollars ($100,000) to be paid in equal quarterly installments of Twenty Five Thousand and No/100s U.S. Dollars ($25,000) based on a valuation formula set forth in the Employment Agreement, but was mistakenly drafted as annual equity compensation equal to not less than Twenty Five Thousand and No/100s U.S. Dollars ($25,000) to be paid in equal quarterly installments based on a valuation formula set forth in the Employment Agreement. As a result of the Amendment No. 1 to the Employment Agreement we are obligated to issued Mr. Patterson 374 additional shares of our common stock, which is valued at $75,000 based on the valuation formula in Mr. Patterson’s Employment Agreement. On February 10, 2025, we entered into an Employment Agreement with Andre Johnson to be our Vice President, Human Resources As part of Mr. Johnson’s compensation we agreed to issue him 1,512 shares of our common stock as a signing bonus, as well as $75,000 worth of our common stock annually, paid in equal quarterly installments. Item 6 - [Reserved]. 30 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. Overview Vivakor, Inc. (“Vivakor” or the “Company”) is a socially responsible operator, acquirer and developer of technologies and assets in the oil and gas industry, as well as related environmental solutions. Beginning in the third quarter of 2025, the Company revised its segment structure to better reflect the way management evaluates operating performance and allocates resources. As a result, the Company now reports three operating and reportable segments, transportation and logistics, terminaling and storage services, and supply and trading, compared with two segments reported in prior periods. The change primarily reflects the growth and increased operational significance of our supply and trading activities and enhances transparency into our operating performance. These segments work together to support the reliable movement of crude oil from production areas to key market hubs across the Permian Basin, Eagle Ford Basin, and mid-continent regions. Our transportation and logistics services include the trucking and pipeline transportation of crude oil and related hydrocarbon products. Trucking operations are based in the DJ Basin, the STACK play in Central Oklahoma, and the Permian and Eagle Ford Basins in Texas, where our crude-oil trucking fleet transports volumes from production sites to our terminaling, storage, and blending facilities. We also operate the 45-mile Omega Gathering Pipeline in Blaine County, Oklahoma, which connects to the Plains STACK Pipeline and provides direct access to the Cushing, Oklahoma storage hub. These assets offer flexible and scalable crude-oil movement solutions that support our terminaling and supply activities across multiple producing regions. Our terminaling and storage segment includes crude oil facilities in Colorado City, Texas, and Delhi, Louisiana, strategically located hubs at major pipeline intersections that support the receipt, handling, blending, storage, and distribution of crude oil and petroleum products. These terminals play a critical role in our midstream network and support our supply and trading activities. Our supply and trading segment enhances our commercial reach by purchasing, aggregating, marketing and reselling crude oil, condensate, natural gas liquids and related hydrocarbon products. Operating as a core component of our integrated midstream platform, the segment connects production, transportation, terminaling, and end-market delivery. The Company is also investing in future growth through the development of Remediation Processing Centers (“RPCs”), with our first facility under construction at the San Jacinto River & Rail Park in Harris County, Texas. Once operational, the RPC is expected to process oilfield solid wastes into economically valuable byproducts such as condensate, propane, and butane and will include an adjacent truck wash facility. The remediation segment will be reported separately and incorporated into operations upon commencement of commercial activity. Overall, our business strategy is centered on building an integrated midstream and environmental services platform that supports operational efficiency, enhances market access for customers, and positions the Company for long-term growth. On October 1, 2024, we acquired Endeavor Crude, LLC, a Texas limited liability company, Equipment Transport, LLC, a Pennsylvania limited liability company, Meridian Equipment Leasing, LLC, a Texas limited liability company, and Silver Fuels Processing, LLC, a Texas limited liability company (collectively with their subsidiaries, the “Endeavor Entities”), making those entities wholly-owned subsidiaries, which gave us operations in several different areas of the midstream oil and gas industry. Our management and Board of Directors is currently reviewing all aspects of the Endeavor Entities’ assets and operations, including the synergies they have with our pre-acquisition operations and the debt related to certain of those assets and operations. In the event our management and Board of Directors determines some of those assets or operations do not fit organizationally with our other assets and operations then we may seek strategic alternatives with those certain assets and/or operations. 31 On July 30, 2025, we sold all of the issued and outstanding limited liability company membership interests in Meridian Equipment Leasing, LLC, a Texas limited liability company, and Equipment Transport, LLC, a Pennsylvania limited liability company (the “Water Trucking Sale”), pursuant to that certain Membership Interest Purchase Agreement of even date therewith by and between Vivakor Transportation, LLC, as Seller, and Jorgan Development, LLC, as Buyer (the “Water Trucking Sale Agreement”), in exchange for $11,058,235 USD paid in 11,058 shares of Series A Convertible Preferred Stock of Vivakor, Inc., which shares will no longer be considered outstanding or be entitled to the relevant annual dividend. The Buyer of such entities is controlled by James Ballengee, our Chairman, President, and Chief Executive Officer. The sale was subject to a one-time post-closing purchase price adjustment based on the sold subsidiaries’ financial results as reflected on Vivakor’s Form 10-Q Quarterly Report for the period ended June 30, 2025, however, no adjustment was required, and the consideration remained unchanged. Prior to consummating the Water Trucking Sale, we transferred certain assets and liabilities between companies and certain affiliates (namely James Ballengee and entities he controls) to comply with pre-existing debt covenants, facilitate crude oil trucking operations, and minimize potential operational disruption to our crude oil-focused businesses. In connection with the Water Trucking Sale, and among other agreements as further set forth in the Water Trucking Sale Agreement, (i) affiliates of Vivakor, and the Ballengee Family Office Affiliates, amended and restated that certain Transition Services Agreement dated October 1, 2024, to account for new and additional services to be provided by various parties thereto, (ii) the parties amended and restated that certain Secured Promissory Note dated August 15, 2022, by and between Vivakor, as Borrower, and Jorgan Development, LLC, as Lender, reducing the payments to Lender thereunder from ninety-nine percent (99%) of Monthly Free Cash Flow, as defined therein, to fifty percent (50%) of Monthly Free Cash Flow, and (iii) Mr. Ballengee and certain Ballengee Family Office Affiliates voluntarily suspended the right to receive dividends and distributions upon Series A Convertible Preferred Stock of Vivakor, Inc. held by them for the period from August 1, 2025 to January 1, 2026. Our website is www.vivakor.com . Reclassifications Certain reclassifications may have been made to prior years’ amounts to conform to the 2024 presentation. Change in Segment Reporting Beginning in the third quarter of 2025, the Company revised its segment reporting structure to better reflect how the chief operating decision maker evaluates performance and allocates resources across the business. Historically, the Company reported two operating segments: crude oil transportation and terminaling and storage services. In August 2024, the Company launched supply and trading activities, and during the third quarter of 2025, management determined that these activities had expanded sufficiently in scope and scale to meet the criteria for a reportable operating segment under ASC 280. As a result, the Company now reports three operating segments: transportation and logistics, terminaling and storage services, and supply and trading. Revenue generated from supply and trading was previously reported within terminaling and storage services in 2025 and as product revenue in 2024. Concurrent with this change, the Company no longer reports “Corporate and Other” as a separate category, as these activities do not represent an operating segment and are not separately reviewed by the chief operating decision maker. Corporate-level expenses, including executive and shared services personnel costs, stock-based compensation, professional fees, and other overhead costs, are now allocated to operating segments or reflected in consolidated results, as appropriate. The Company’s chief operating decision maker uses segment gross profit as the primary measure of performance for evaluating operating results and making decisions regarding the allocation of capital and resources. Accordingly, segment results are presented through gross profit, and segment-level operating income or loss is no longer presented. This change aligns external reporting with the manner in which management currently views and manages the business. All segment information presented reflects the updated structure. Prior-period segment information has been recast, where applicable, to conform to the current presentation. The change in reportable segments did not impact the Company’s consolidated financial statements for prior periods other than reclassifications to conform prior period segment information to the current presentation. 32 Results of Consolidated Operations Revenue For the years ended December 31, 2025 and 2024, revenues were $104,418,809 and $89,811,240, respectively, representing an increase of $14,607,569, or 16%. The increase in revenue was primarily attributable to a full year of operations from the transportation and logistics segment following the acquisition of the Endeavor Entities on October 1, 2024, as well as the expansion of supply and trading activities during 2025. Cost of Revenue For the years ended December 31, 2025 and 2024, cost of revenues was $66,672,658 and $79,592,036, respectively, representing a decrease of $11,717,963, or 15%. Cost of revenues consists primarily of costs associated with the purchase and sale of crude oil and natural gas liquids, as well as operating costs related to transportation and logistics and terminaling activities. The decrease in cost of revenues was primarily driven by changes in revenue mix, including increased contributions from higher-margin transportation and logistics operations and reduced relative activity in lower-margin terminaling and related-party transactions compared to the prior year. Gross Profit and Gross Margin For the years ended December 31, 2025 and 2024, gross profit was $37,746,151 and $10,219,204, respectively, representing an increase of $26,325,532, or 258%. The increase in gross profit was primarily driven by higher revenues and a significant improvement in gross margin within the transportation and logistics segment, which generated substantially higher margins following the acquisition of the Endeavor Entities. Gross margin improved as a result of a shift in business mix toward higher-margin transportation and logistics activities and improved utilization of the Company’s assets. While the supply and trading segment contributed significantly to total revenues during 2025, it generated minimal gross profit due to the nature of those activities, which are characterized by high volumes and low margins. Gross margin may continue to be affected by a variety of factors, including commodity prices, product mix, volumes handled across the Company’s assets, and the Company’s ability to effectively manage operating costs and expand higher-margin service offerings. Operating Expenses Our operating expenses consist primarily of sales and marketing, general and administrative expenses, impairment expense, and amortization and depreciation expense. For the years ended December 31, 2025 and 2024, total operating expenses were $101,574,078 and $32,214,497, respectively, representing an increase of $69,359,581, or 215%. The increase was primarily driven by a $40,569,772 impairment charge recorded during 2025, as well as the inclusion of a full year of operating expenses from the Endeavor Entities, which were acquired on October 1, 2024. The Company also reduced goodwill in connection with the divestiture of certain business units during the year. General and administrative expenses increased to $43,014,172 for the year ended December 31, 2025 from $12,206,031 for the year ended December 31, 2024, primarily due to the inclusion of a full year of costs associated with the Endeavor Entities, as well as increased professional fees and other public company costs. Amortization and depreciation expense increased to $17,981,914 from $11,360,425, primarily reflecting additional assets placed into service following the acquisition. 33 Loss from Operations For the years ended December 31, 2025 and 2024, loss from operations was $63,827,927 and $21,995,293, respectively, representing an increase of $41,832,634, or 190%. The increase in operating loss was primarily driven by a $40,569,772 goodwill impairment charge recorded during 2025. Excluding the impact of the impairment charge, operating results reflect increased activity from a full year of operations following the acquisition of the Endeavor Entities on October 1, 2024, including higher revenues and gross profit, partially offset by increased general and administrative expenses associated with the expanded scale of the Company’s operations. Interest Expense and Loss on Conversion of Debt For the years ended December 31, 2025 and 2024, we realized interest expense of $26,668,529 and $4,695,234, which represents an increase of $20,304,237, or 432.44%. The increase was primarily driven by refinancing and forbearance arrangements entered into during the period, which resulted in the recognition of unamortized original issue discount and deferred financing cost write-offs, along with default-related fees. Interest expense also increased due to finance lease and debt obligations assumed in the acquisition of the Endeavor Entities on October 1, 2024, as well as the effects of the Maxus Capital Group forbearance agreement. In addition to higher interest expense, we recognized a loss on conversion of debt of $17,403,367. The loss resulted from (i) the conversion of approximately $8.1 million of outstanding convertible debt into common stock at contractually discounted conversion prices significantly below market value, creating a non-cash charge for the excess fair value of shares issued, and (ii) the recognition of an estimated derivative liability associated with the remaining convertible notes due to the lender’s ability to convert the debt at discounted default-based conversion prices. This derivative liability is reflected within Other Liabilities on the condensed consolidated balance sheet and totaled $9,062,320 as of December 31, 2025. Unrealized Loss on Marketable Securities For the years ended December 31, 2025 and 2024, we reported an unrealized loss of $413,188 and an unrealized gain of $165,275 on marketable securities, which represents a decrease in the unrealized gain of $578,463, or 350.00%. Our marketable securities were 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 gain as noted above. Provision for Income Tax The Company recorded an income tax provision of $117,004 and $126,869 for the years ended December 31, 2025 and 2024, respectively. The Company’s effective tax rate for 2025 and 2024 was -0.10% and -0.11%, which was the result of the (provision) or benefit of book income/losses offset by an additional valuation allowance on the net operating losses. Noncontrolling Interest Noncontrolling interests represent the portion of certain consolidated subsidiaries that are owned by third parties. The decrease in noncontrolling interest was due primarily related to the noncontrolling interest’s allocation of the impairment expenses noted above. Segment Operating Results for the Years Ended December 31, 2025 and 2024 Operating Results of our Terminaling and Storage Segment : 2025 2024 Change ($) Change (%) Revenues $ 3,389,461 $ 39,829,406 $ (36,439,945 ) (91.49 )% Revenues - related party 8,330,299 31,199,089 (22,868,790 ) (73.30 )% Total revenues 11,719,760 71,028,495 (59,308,735 ) (83.50 )% Cost of revenues 4,162,336 65,788,017 (61,625,681 ) (93.67 )% Gross profit $ 7,557,424 $ 5,240,478 $ 2,316,946 44.21 % The terminaling and storage services segment consists of crude oil terminal facilities located in Colorado City, Texas and Delhi, Louisiana. 34 Revenue The Terminaling and Storage segment generated total revenues of $11.7 million for the year ended December 31, 2025, compared to $71.0 million for the year ended December 31, 2024, representing a decrease of $59.3 million, or 83%. The decrease in revenue was primarily attributable to the divestiture of Meridian Equipment Leasing and Equipment Transport in July 2025, which significantly reduced related-party volumes and throughput activity compared to the prior year. In addition, the decline in related-party revenues reflects a change in classification of certain activities to the transportation and logistics segment, as well as a reduction in related party crude sales. Cost of Revenue Cost of revenues was $4.2 million for the year ended December 31, 2025, compared to $65.8 million for the year ended December 31, 2024, representing a decrease of $61.6 million, or 94%. The decrease in cost of revenues was primarily driven by the reduction in volumes associated with the divested entities and a decline in lower-margin related-party activity. Gross profit increased to $7.6 million for the year ended December 31, 2025 from $5.2 million for the year ended December 31, 2024, representing an increase of $2.3 million, or 44%. The increase in gross profit, despite lower revenues, reflects a shift in revenue mix toward higher-margin terminaling activities and reduced exposure to lower-margin throughput and related-party transactions. Operating Results of our Transportation Logistics Segment : 2025 2024 Change ($) Change (%) Revenues $ 23,218,485 $ 18,782,745 $ 4,435,740 23.62 % Revenues - related party 11,895,108 - 11,895,108 100.00 % Total revenues 35,113,592 18,782,745 16,330,847 86.95 % Cost of revenues 6,171,668 13,804,019 (7,632,351 ) (51.29 )% Gross profit $ 28,941,924 $ 4,978,726 $ 23,963,198 481.31 % This segment was acquired as part of the Company’s acquisition of the Endeavor Entities on October 1, 2024 and includes crude oil gathering and transportation assets, including pipeline and trucking operations in the Permian and Anadarko Basins. Revenue The Transportation and Logistics segment generated total revenues of $35.1 million for the year ended December 31, 2025, compared to $18.8 million for the year ended December 31, 2024, representing an increase of $4.4 million, or 23.62%. The increase in revenue was primarily attributable to a full year of operations in 2025, compared to a partial period following the acquisition in October 2024, as well as continued activity across the Company’s transportation network. In addition, the increase reflects a realignment of certain related-party revenues that were previously reported within the terminaling and storage segment and are now included in the transportation and logistics segment, consistent with the Company’s revised segment reporting structure. 35 Cost of Revenue Cost of revenues was $6.1 million for the year ended December 31, 2025, resulting in gross profit of $28.9 million, compared to gross profit of $5.0 million for the year ended December 31, 2024. The increase in gross profit was driven by higher revenues and strong margins associated with the transportation and logistics operations. The segment continues to benefit from a favorable cost structure, including relatively fixed operating costs and high utilization of trucking and pipeline assets, which contributes to strong gross margins. Revenue and gross profit reflect continued trucking and pipeline transportation activity across the Permian, Eagle Ford, DJ Basin, and STACK play following the integration of the Endeavor operations. Operating Results of our Supply and Trading Segment : 2025 2024 Change ($) Change (%) Revenues $ 57,585,457 $ - $ 57,585,457 100.00 % Revenues - related party - - - 0.00 % Total revenues 57,585,457 - 57,585,457 100.00 % Cost of revenues 57,540,070 - 57,540,070 100.00 % Gross profit $ 45,388 $ - $ (45,388 ) 100.00 % The supply and trading segment purchases, markets, and resells crude oil, condensate, and related hydrocarbon products. Revenue The Supply and Trading segment generated revenues of $57.6 million for the year ended December 31, 2025. This segment had no comparable revenue in the prior year, as these activities were not reported as a separate operating segment prior to 2025. Certain supply and trading activities were previously included within terminaling and storage services in 2025 and reported as product revenue in 2024. Cost of Revenues Cost of revenues was $57.5 million for the year ended December 31, 2025, resulting in gross profit of $45,388. The segment operates on high-volume, low-margin transactions, and as a result, generated minimal gross profit relative to total revenues. Profitability within this segment is influenced by crude oil pricing, blend economics, sourcing costs, and market demand for specific crude qualities. While this segment contributes significantly to total revenues, it is not expected to be a primary driver of gross profit compared to the Company’s transportation and logistics operations. Cash Flows The following table sets forth the primary sources and uses of cash and cash equivalents for the years ended December 31, 2025 and 2024 as presented below: December 31, 2025 2024 Net cash provided by (used) in operating activities $ (15,780,294 ) $ 1,810,827 Net cash provided by (used) in investing activities 1,671,926 302,188 Net cash provided by financing activities 12,527,272 819,670 36 Liquidity and Capital Resources We have historically incurred net losses and negative cash flows from operations. As of December 31, 2025 and 2024, we had an accumulated deficit of approximately $204.0 million and $89.0 million, respectively. We also had working capital deficits of approximately $53.2 million and $101.5 million as of December 31, 2025 and 2024, respectively. As of December 31, 2025, we had cash and cash equivalents of $2.1 million, of which $1.8 million was restricted cash. As of December 31, 2024, we had cash and cash equivalents of $3.7 million, including $3.0 million of restricted cash. To date, we have financed our operations primarily through debt financings and private equity offerings. Our common stock is listed on the Nasdaq Capital Market under the symbol “VIVK.” Cash Flows from Operating Activities Net cash used in operating activities was $15.8 million for the year ended December 31, 2025, compared to net cash provided by operating activities of $1.8 million for the year ended December 31, 2024. Cash used in operating activities during 2025 was primarily driven by our net loss of $110.1 million, partially offset by non-cash items, including $18.0 million of depreciation and amortization, $40.6 million of impairment charges, $17.4 million of non-cash interest expense, and $3.4 million of stock-based compensation and stock issued for services. Additionally, we recorded a $17.4 million loss on conversion of debt. Changes in working capital also contributed to cash usage, including a $22.8 million increase in accounts receivable and a $13.4 million decrease in accounts payable and accrued expenses. These uses of cash were partially offset by modest favorable changes in other operating assets and liabilities. For the year ended December 31, 2024, operating cash flows benefited from lower net losses of $26.4 million and similar non-cash adjustments, including $11.4 million of depreciation and amortization, $8.6 million of impairment charges, $4.8 million of non-cash interest expense, and $2.6 million of stock-based compensation. Working capital changes in 2024 included a $5.1 million increase in accounts receivable and a $7.5 million decrease in accounts payable and accrued expenses. Non-cash investing and financing activities, including stock-based compensation and equity issued for services, reduced the need for cash outflows in both periods. Cash Flows from Investing Activities Net cash provided by investing activities was $1.7 million for the year ended December 31, 2025, compared to $0.3 million for the year ended December 31, 2024. Investing activities in 2025 were primarily driven by $2.4 million in proceeds from the sale of property and equipment, partially offset by $0.7 million of cash returned in connection with the divestiture of Meridian Equipment Leasing and Equipment Transport and $25,515 in purchases of equipment. For the year ended December 31, 2024, investing activities included $4.8 million of cash used for the acquisition of assets in connection with the Endeavor Entities transaction, as well as $4.5 million in capital expenditures related to the buildout of RPCs, wash plant, and pipeline facilities. Overall, investing activity in both periods reflects our continued focus on infrastructure development and strategic portfolio optimization through acquisitions and divestitures. 37 Cash Flows from Financing Activities Net cash provided by financing activities was $12.5 million for the year ended December 31, 2025, compared to $0.8 million for the year ended December 31, 2024. Financing activities during 2025 were primarily driven by $21.1 million in proceeds from loans and notes payable, including $3.1 million from related parties, as well as $9.7 million in proceeds from the issuance of common stock. These inflows were partially offset by $15.6 million in repayments of notes payable and related party debt and $2.6 million in payments on finance lease liabilities. For the year ended December 31, 2024, financing activities included $7.5 million in proceeds from loans and notes payable, including $1.7 million from related parties, and $1.4 million in proceeds from the issuance of common stock. These inflows were offset by $6.1 million in repayments of notes payable and related party debt and $2.0 million in payments on finance lease liabilities. Overall, financing activities in both periods reflect our reliance on a combination of debt financing, including related party support, and equity issuances to fund operations, capital expenditures, and strategic transactions. Liquidity Outlook and Going Concern Based on our current cash position, projected operating cash flows, and existing obligations, we will require additional capital to fund operations and meet our debt obligations over the next twelve months. As of December 31, 2025, we had approximately $2.1 million in cash and cash equivalents, of which $1.8 million was restricted, and approximately $11 million of debt maturing within one year. These factors, together with our history of operating losses and negative cash flows, continue to place significant pressure on our liquidity. Management is actively pursuing multiple initiatives to enhance liquidity, including raising capital through equity and debt financings, executing a structured financing arrangement, and advancing the potential sale of certain midstream and transportation assets. In addition, we are focused on improving operating cash flows through the execution of our business plan, including strategic acquisitions, asset monetization, and cost management initiatives. While we believe these actions, if successfully executed, will improve our liquidity position, there can be no assurance as to the timing or availability of such financing or the completion of planned transactions. As a result, we may be required to delay, scale back, or eliminate certain operations or pursue additional strategic alternatives. Contractual Obligations Regarding the Company’s finance lease liabilities during 2025, the Company entered into a forbearance agreement with Maxus Capital Group, LLC related to certain lease obligations, which provided for revised payment terms. The Company did not comply with certain terms of the agreement and is currently working with the lender to address the outstanding obligations. As a result, the related finance lease liabilities have been classified as current as of December 31, 2025. Description Amount Principal portion of finance lease obligations $ 8,711,784 Accrued interest $ 390,068 Total finance lease liabilities (current) $ 9,101,852 38 Our contractual obligations as of December 31, 2025 for operating lease liabilities are for office warehouse space, land, and truck yards, which leases end in 2026 through 2027. Operating lease obligations as of December 31, 2025 are as follows: 2025 85,080.00 2026 305,817.12 2027 150,478.56 2028 - 2029 - Thereafter $ - Total Remaining $ 541,375.68 Interest Rate and Market Risk Interest Rate Risk Interest rate risk is the potential for reduced net interest income and other rate-sensitive income resulting from adverse changes in the level of interest rates. We do not have variable interest rate-sensitive income agreements. We do have financing arrangement, in which notes have variable interest rates based on the prime rate, which exposes us to further interest expense if the prime rate increases. Market Risk — Equity Investments Market risk is the potential for loss arising from adverse changes in the fair value of fixed-income securities, equity securities, other earning assets, and derivative financial instruments as a result of changes in interest rates or other factors. We own equity securities that are publicly traded. Because the fair value of these securities may fall below the cost at which we acquired them, we are exposed to the possibility of loss. Equity investments are approved, monitored, and evaluated by members of management. Inflation Prolonged periods of slow growth, significant inflationary pressures, volatility and disruption in financial markets, could lead to increased costs of doing business. Inflation generally will cause suppliers to increase their rates, and inflation may also increase employee salaries and benefits. 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 None. 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. Estimates by 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 conditions. We believe our critical accounting estimates relate to the following: Recoverability of current and noncurrent assets, stock-based compensation, income taxes, effective interest rates related to long-term debt, marketable securities, lease assets and liabilities, valuation of stock used to acquire assets, and derivatives. 39 Item 7A - Quantitative and Qualitative Disclosures About Market Risk Not applicable. Item 8 - Financial Statements and Supplementary Data 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 None.