Note 5. Acquisition of Simson-Maxwell

Effective August 6, 2021, Viking entered into a Share Purchase Agreement with Simmax Corp., (“Simmax”), Remora EQ LP, (“Remora”), and Simson-Maxwell Ltd., (“Simson-Maxwell”), pursuant to which Viking agreed to purchase 419 Class A Common Shares of Simson-Maxwell from Simmax and 555 Class A Common Shares of Simson-Maxwell from Remora for a total purchase price of CA$3,998,045 (approximately US$3,198,936) (the “Purchase Price”).

Simultaneously, effective August 6, 2021, Viking entered into a Subscription Agreement with Simson-Maxwell (the “Subscription Agreement”), pursuant to which Viking agreed to purchase from Simson-Maxwell 1,462 Class A Common Shares of Simson-Maxwell for a purchase price of CA$6,001,641.58 (approx. US$4,799,009. (the “Subscription Price”).

These acquisitions resulted in Viking owning a total of 2,436 Class A Common Shares of Simson-Maxwell, representing approximately 60.5% of the total issued and outstanding shares of Simson-Maxwell.

Also on August 6, 2021, Viking entered into a Unanimous Shareholders Agreement with Simmax, Remora and Simson-Maxwell regarding the ownership and governance of Simson-Maxwell, and pursuant to which Viking shall nominate two members of the Board of Directors of Simson-Maxwell, Simmax shall nominate one member of the Simson-Maxwell Board, Remora shall nominate one member of the Simson-Maxwell Board, and Viking, Remora and Simmax shall jointly nominate the fifth member of the Simson-Maxwell Board.

The August 6, 2021 amendment also contained certain provisions that required 2/3rds majority of the Board to vote for changes in the capital budget of the Company, capital expenditures in excess of $250k and other provisions generally considered to be participatory rights, which would preclude Viking from consolidating Simson-Maxwell.

On October 18, 2021, the Company amended the Unanimous Shareholders Agreement with Simmax, Remora and Simson-Maxwell to increase the number of board member to five with three board members nominated by Viking and to require two thirds approval of the board of directors only for matters affecting issuance of dilutive shares, dissolution of Simson-Maxwell and other matters that generally would protect non-controlling shareholders. The changes to the Unanimous Shareholders Agreement on October 18, 2021 rescinded the two thirds Board approval requirement for all matters except those that are protective in nature, at which point, Viking obtained control of Simson-Maxwell.

As a result, Simson-Maxwell is included in the accompanying consolidated financial statements under the equity method from August 6, 2021 to October 18, 2021 and is consolidated from the effective date (October 18, 2021) of the acquisition. The recorded cost of this acquisition was based upon the fair market value of the assets acquired based on an independent valuation.

The total value of the consideration given was determined as follows:

The fair values of assets acquired and liabilities assumed in connection with this acquisition are as follows:

During the three months ended September 30, 2022, the Company completed its evaluation of the fair value of the assets and liabilities acquired. Based upon this evaluation, the Company increased the value of fixed assets by $419,543, reduced goodwill from $252,290 to nil, and adjusted noncontrolling interest from $(4,914,274) to $(5,081,527).

Proforma financial data is not presented as it was impractical to do so as Simson-Maxwell did not have quarterly information prepared utilizing an acceptable basis of accounting.