ACQUISITION OF COLLINS BUILDING & CONTRACTING

9 Months Ended

Sep. 30, 2024

Collins Building & Contracting [Member]

Business Acquisition [Line Items]

ACQUISITION OF COLLINS BUILDING & CONTRACTING

3. ACQUISITION OF COLLINS BUILDING & CONTRACTING

On August 31, 2023, the Company entered into a stock purchase agreement with the owner of Collins Building & Contracting, Inc. (“Collins Building”) pursuant to which the owner agreed to sell all of the outstanding common stock of Collins Building to the Company in exchange for (a) cash consideration of $1,000,000, (b) a five-year secured promissory note in the principal amount of $2,000,000, bearing interest at 7.0% per annum (the “First Promissory Note”), and (c) a two-year secured promissory note in the principal amount of $2,035,250, bearing interest at 8.25% per annum (the “Second Promissory Note”). The First Promissory Note is secured by the acquired real property and quarry infrastructure, and the Second Promissory Note is secured by the acquired equipment.

The Company accounted for the transaction as a business combination in accordance ASC 805 “Business Combinations”. The Company has performed an allocation of the purchase price paid for the assets acquired and the liabilities assumed. The fair values of the assets acquired are set forth below. Because the fair values exceeded the purchase price, a gain on the purchase of $1,875,150 was recognized. The allocation of the purchase price is based on management’s estimates and a third-party assessment of the fair value of the equipment purchased.

Fair value of assets acquired:
Equipment	$	6,156,000
Land		554,900
Buildings		199,500
Total assets acquired		6,910,400
Less: Gain on bargain purchase price		(1,875,150	)
Purchase price	$	5,035,250
Cash consideration		1,000,000
Long-term notes issued to the seller		4,035,250
Total purchase price	$	5,035,250
Acquisition transaction costs incurred	$	167,212

As discussed in Note 2, on August 22, 2024, almost all of the equipment, as well as the land and buildings acquired on August 31, 2023, were sold to the previous owner of Collins Building in consideration of the full and complete cancellation of the First Promissory Note and the Second Promissory Note.

Collins Building’s operations contributed revenues of $0 and net loss of $8,136 to the Company’s consolidated revenues and net operating loss for the three months ended September 30, 2024. For the nine months ended September 30, 2024, Collins Building’s operations contributed no revenue and a net operating loss of $552,972. The losses stem primarily from depreciation of equipment and buildings purchased as part of the Collins Building acquisition. Collins Building contributed no revenue to the Company’s consolidated revenues for the three months and nine months ended September 30, 2023. The Company recorded the revenue generated from reclamation services on abandoned mine land, which was historically the core business of Collins Building, as revenue of Range Environmental. A gain on bargain purchase of $1,875,150 offset by $88,271 of depreciation expense was recorded for Collins Building for the three and nine months ended September 30, 2023.