James Ballengee

About James Ballengee

James H. Ballengee, 60, has served as Vivakor’s Chief Executive Officer and Chairman since October 2022, with 25+ years in midstream oil logistics (Taylor Logistics, Bridger Group/Bridger LLC) and an accounting degree from LSU–Shreveport . Under his tenure, Vivakor closed the Endeavor Entities acquisition (10/1/2024) and expanded crude logistics, contributing to quarterly revenues of $37.3M in Q1 2025 and $29.1M in Q2 2025 (see Performance table); EBITDA has remained pressured amid financing/dilution and restructuring actions * *. He is Vivakor’s principal shareholder (45.85% beneficial ownership as of 8/13/2025), aligning economics but concentrating control .

Past Roles

External Roles

Fixed Compensation

Notes: Ballengee’s employment agreement (10/28/2022) sets annual compensation at $1,000,000 in stock by 5‑day VWAP on agreement date and each anniversary; eligible for discretionary bonus; at‑will with 5 business days’ termination notice .

Performance Compensation

• No specific formulaic annual bonus metrics disclosed for CEO; eligible for discretionary performance bonus .
• Outstanding equity/vesting:
  • Unvested stock: 566,212 shares as of 12/31/2024 (market value $416,732 as of 4/7/2025) .
  • Owed shares for 10/28/2024–10/27/2025 under employment agreement: 688,891 shares, payable as 172,222 on three quarterly installments and 172,225 final installment (shares issued on 2/26/2025: 160,266 for services 10/28/2024–1/27/2025) .
• Options: None for CEO (no outstanding or unexercised options as of 12/31/2024) .

Governance on incentives:

• No external compensation consultant; committee reviews “similar public companies” to inform levels .
• Clawbacks: Not broadly disclosed for CEO awards; certain executive sign‑on grants (e.g., Knapp) include a conditional clawback aligned with 18‑month lockup .

Equity Ownership & Alignment

• Beneficial ownership (Record Date 8/13/2025): 22,928,393 common shares (45.85%) .
  • Includes: 17,311,420 (Jorgan) + 1,889,590 to be issued within 60 days for Series A dividends; 105,941 (JBAH) + 18,898 to be issued; 21,552 (Ballengee Holdings); 3,419,103 personal + 161,889 to be issued under employment agreement within 60 days .
• Options: None .
• Vested vs unvested: 566,212 unvested as of 12/31/2024 .
• Lockups/overhang:
  • Sellers (Jorgan/JBAH) agreed to 18‑month lock‑ups on Common Stock consideration and on any Common issued from Preferred conversions/dividends from the 10/1/2024 Endeavor transaction—reducing near‑term sell pressure through ~April 2026 .
  • Series A dividends paid in stock created recurring issuance (e.g., 1,764,964 shares on 5/20/2025; 1,384,311 to Jorgan; 13,983 to JBAH) .
  • Voluntary suspension of Series A dividends/distributions for entities controlled by Ballengee from 8/1/2025 to 1/1/2026, temporarily reducing issuance pressure .
• Hedging/pledging: No personal share pledging or hedging policies disclosed for executives in the cited documents; company pledged treasury/common and subsidiary equity as loan collateral in financing agreements (corporate, not personal) .

Employment Terms

• CEO Employment Agreement (10/28/2022): $1,000,000/year in stock by 5‑day VWAP; discretionary bonus eligibility; at‑will; 5‑day termination notice; right to nominate two board members (and a third upon “Note Payment Shares” issuance) .
• Severance/COC: No CEO severance multiple or single/double‑trigger CIC equity acceleration disclosed in the proxy; debt agreements define “Change of Control” events tied to Ballengee’s continued role/ownership as a lender covenant, not an executive parachute .
• Other executives for context: New CFO (Kimberly Hawley) has 1‑year pay lump‑sum severance if terminated without cause .

Board Governance

• Role and independence: Ballengee is CEO and Chairman; board reduced to four members by July 31, 2025 with three independent directors (Harris, Johnson, Thompson) under Nasdaq Rule 5605 .
• Committees (all‑independent):
  • Audit: Chair Michael Thompson; Thompson designated “audit committee financial expert” .
  • Compensation: Chair John Harris .
  • Nominating & Corporate Governance: Chair Albert Johnson .
• Attendance: Board held 8 meetings in 2024; all directors attended >75% of meetings .
• Dual‑role implications: CEO/Chairman plus majority ownership centralizes control. Independent committees and a majority‑independent board mitigate, but related‑party transactions with entities he controls increase conflict‑of‑interest risk requiring robust oversight .

Director Compensation (context)

• Ballengee receives no separate director fees .
• Independent directors received cash retainers (e.g., Harris and Johnson $60,000 each; Thompson $34,615) and equity in 2024 .

Related‑Party Transactions (governance red flags)

• Acquisition and later asset divestiture to CEO‑controlled entity:
  • 10/1/2024: Vivakor acquired Endeavor Entities from sellers beneficially owned by Ballengee; consideration included 6,700,000 Common and 107,789 Series A Preferred shares (dividend 6% payable in stock; company can force conversion at $1.00/common) with 18‑month lockup .
  • 7/30/2025: Sold Meridian Equipment Leasing, LLC and Equipment Transport, LLC to Jorgan Development (controlled by Ballengee) for $11,058,235 in Series A Preferred; dividend/distribution rights on Series A held by Ballengee affiliates suspended 8/1/2025–1/1/2026 .
• Take‑or‑pay and supply agreements with Ballengee‑controlled entities:
  • White Claw Colorado City (WCCC) storage: $150,000/month minimum through 12/31/2031; ~$1.8M storage revenue in 2024 and 2023 .
  • Silver Fuels Delhi (SFD) crude supply/profit‑share with White Claw Crude: minimum 1,000 bpd with $5/bbl margin floor and 10% profit‑share on excess through 12/31/2031; 2024 crude purchases from WC Crude $41.78M; NGL sales $10.79M .
• Insider lending:
  • Promissory notes to Ballengee Holdings ($500,000 at 10% interest; convertible with floor $1.00; 7/5/2024; maturity extended to 9/30/2025) .
  • Working‑capital promissory note up to $1.5M (initially to Ballengee, novated to Ballengee Holdings) .
• Maxus Capital forbearance: Payment schedule requiring both Vivakor Obligors and “Ballengee Obligors” (related parties) to make multi‑million payments and fees; includes $250,000 cash and $250,000 in restricted common as forbearance fee .

Performance & Track Record (operational/financial context)

Values with an asterisk were retrieved from S&P Global.

Risk Indicators & Red Flags

• Dilution/convertibles: J.J. Astor conversions in Nov 2025 (3.87M shares issued at discounted conversion per note terms); notes permit conversion at 80% of lower price or deeper (50%) on default; company reserved 15,000,000 shares for potential conversion under Additional Note . Additional 2025 convertible notes (~$5.8M principal) also priced at 80% of reference, with 753,750 “incentive” shares issued .
• Listing risk: Nasdaq minimum bid deficiency; reverse split authorization (1:5 to 1:25) sought to maintain listing .
• Governance/related parties: Multiple material transactions with CEO‑controlled entities; board seeks shareholder ratification of July 2025 sale to Jorgan .
• Executive turnover/litigation: CFO resignation (7/19/2025) ; subsequent settlement of CFO wage dispute for $2,000,000 with scheduled payments and stipulated judgment protections – –; General Counsel resignation with severance/top‑up share arrangement –.

Compensation Structure Analysis (alignment and pressure points)

• Heavy equity‑in‑lieu‑cash pay: CEO salary paid fully in common shares by a fixed VWAP formula—aligns with stock price, but mechanically increases share issuance regardless of performance; 1.94M+ shares issued or scheduled for 2024 compensation and early 2025 installments .
• Lack of disclosed performance metrics/targets for CEO: No explicit revenue/EBITDA/TSR hurdles; reliance on discretion raises pay‑for‑performance risk .
• Equity overhang and issuance cadence: Series A dividend in stock (6% on $1,000 stated value per share) creates ongoing share issuance; e.g., 1.30M shares for four months’ dividends (Apr 2025 8‑K) and 1.76M for three months (May 2025) with large allocations to Ballengee‑controlled entities . Voluntary dividend suspension (Aug–Dec 2025) modestly eased pressure .
• No disclosed CEO severance/COC multipliers: Reduces parachute risk; however, debt covenants effectively tie financing to Ballengee remaining CEO/maintaining ownership—creating key‑man and financing risk .

Board Governance (Director Service and Committee Roles)

• Service history on this board: Director and CEO since 2022; nominated independent directors Harris and Johnson pursuant to his employment agreement rights .
• Committee roles: Not a committee member; all key committees comprised solely of independent directors; chairs as noted above .
• Independence status: Not independent (executive); board majority independent .

Employment Terms (Severance & Change‑of‑Control Economics)

• CEO: At‑will; no severance multiple disclosed; discretionary bonus; director‑nomination rights . No explicit single/double‑trigger acceleration disclosed for CEO .
• COC in financing: “Change of Control” definitions in lender agreements treat Ballengee’s role/ownership as pivotal and default‑sensitive .

Say‑on‑Pay & Shareholder Feedback

• Say‑on‑pay advisory vote placed on 2025 proxy (results not included in the proxy itself) .

Investment Implications

• Alignment vs control: Very large insider ownership and salary paid in shares strongly align economics but drive ongoing issuance and concentrate control. Independent committees exist, but substantial related‑party dealings (storage/supply contracts; asset sale to Jorgan) mean investors should demand rigorous conflict management and transparent pricing oversight – .
• Dilution overhang: Series A dividend in stock, convertibles with steep discounts, and stock‑settled liabilities (including prior notes and CFO/GC arrangements) create persistent supply; reverse‑split authorization signals listing risk mitigation rather than fundamental fix – –.
• Execution risk: Revenue scaled with Endeavor integration (Q1/Q2 2025), but EBITDA and net losses remain negative, while cash from operations turned deeply negative in Q2 2025, raising funding and leverage risks amid covenant burdens and dilution * * *.
• Retention/Key‑man: Debt covenants relying on Ballengee as CEO imply key‑man dependence; absence of a disclosed CEO severance/CIC plan cuts parachute risk but could complicate succession planning .

All citations:

Values with an asterisk were retrieved from S&P Global.