| Goodwill and Intangible Assets, Net |
Note 7: Goodwill and Intangible Assets, Net
Goodwill
In 2013, the Company recognized $10,365,806 in
Goodwill, representing the excess of the fair value of the consideration for the Merger over net identifiable assets acquired. Pursuant
to FASB ASC 350-20, Goodwill is not subject to amortization but is subject to annual review to determine if certain events warrant impairment
to the Goodwill asset.
As a result of the ChizComm acquisition, the consideration
exceeded the fair value of the assets acquired by $9,607,027. Accordingly, this amount was recorded as Goodwill at the time of the acquisition.
Through March 31, 2021, the Company has not recognized any impairment to Goodwill.
The following table represents details of our
goodwill balance:
| |
|
Total |
|
| Goodwill as of December 31, 2020 |
|
$ |
10,365,806 |
|
| Acquisition of ChizComm Entities |
|
|
9,607,027 |
|
| Goodwill as of March 31, 2021 |
|
$ |
19,972,833 |
|
Intangible Assets, Net
The Company had the following intangible assets
as of March 31, 2021, and December 31, 2020:
| |
|
March 31, 2021 |
|
|
December 31, 2020 |
|
| Trademarks (a) |
|
$ |
129,831 |
|
|
$ |
129,831 |
|
| Trade Name (b) |
|
|
3,430,000 |
|
|
|
– |
|
| Customer Relations (c) |
|
|
6,140,000 |
|
|
|
– |
|
| Non-Compete (d) |
|
|
60,000 |
|
|
|
– |
|
| Other Intangible Assets (a) |
|
|
299,028 |
|
|
|
299,028 |
|
| Intangible Assets, Gross |
|
|
10,058,859 |
|
|
|
428,859 |
|
| Less Accumulated Amortization (e) |
|
|
(491,687 |
) |
|
|
(400,165 |
) |
| |
|
|
|
|
|
|
|
|
| Intangible Assets, Net |
|
$ |
9,567,172 |
|
|
$ |
28,694 |
|
|
(a) |
Pursuant to FASB ASC 350-30-35, the Company reviews these intangible assets periodically to determine
if the value should be retired or impaired due to recent events. |
|
(b) |
Amount represents fair value of the ChizComm and ChizComm Beacon Media trade names which have determined
to have an indefinite useful life. |
|
(c) |
Amount represents fair value of the ChizComm and ChizComm Beacon Media customer relationships with a useful
life of 12 years. Amortization expense for the three months ended March 31, 2021 was $85,333. |
|
(d) |
Amount represents fair value of the Non-compete agreements as part of the ChizComm acquisition. The non-compete
agreements have a useful life of 3 years. Amortization expense for the three months ended March 31, 2021 was $3,333. |
|
(e) |
During the three months ended March 31, 2021 and March 31, 2020, the Company recognized, $2,855 and $10,791,
respectively, in amortization expense related to the Trademarks, Product Masters, and Other Intangible Assets. |
Expected future intangible asset amortization as of March 31, 2021
is as follows:
| Fiscal Year: |
|
|
|
| 2021 |
|
$ |
407,391 |
|
| 2022 |
|
|
542,528 |
|
| 2023 |
|
|
538,187 |
|
| 2024 |
|
|
514,400 |
|
| Thereafter |
|
|
4,134,666 |
|
| Total |
|
$ |
6,137,172 |
|
|