Quarterly report pursuant to Section 13 or 15(d)

Intangible Assets

v3.23.3
Intangible Assets
9 Months Ended
Sep. 30, 2023
Intangible Assets  
Intangible Assets

Note 4 — Intangible Assets

Effective September 30, 2020, the Company acquired 100% of the equity interests of Orange142 for a purchase price of $26,207,981. The acquisition of Orange142 was recorded by allocating the total purchase consideration to the fair value of the net tangible assets acquired, including goodwill and intangible assets, in accordance with ASC 805. The purchase consideration exceeded the fair value of the net assets, resulting in goodwill of $4,095,700 and intangible assets of $18,033,850. The Company records amortization expense on a straight-line basis over the life of the identifiable intangible assets. For the three months ended September 30, 2023 and 2022, amortization expense of $488,455 and $488,455, respectively, and for the nine months ended September 30, 2023 and 2022, amortization expense of $1,465,363 and $1,465,364, respectively, was recognized. As of September 30, 2023 and December 31, 2022, intangible assets net of accumulated amortization was $12,172,396 and $13,637,759, respectively.

As of September 30, 2023, intangible assets and the related accumulated amortization, weighted-average remaining life and future amortization expense are as follows:

    

Trademarks and

Non-compete

    

Customer lists

    

tradenames

    

agreements

    

Total

Fair value at acquisition date

$

13,028,320

$

3,501,200

$

1,504,330

$

18,033,850

Accumulated amortization

 

(3,908,496)

 

(1,050,360)

 

(902,598)

 

(5,861,454)

Intangible assets, net

$

9,119,824

$

2,450,840

$

601,732

$

12,172,396

Estimated life (years)

 

10.0

 

10.0

 

5.0

 

  

Weighted-average remaining life (years)

 

7.0

7.0

 

2.0

 

  

    

Total

2023

    

$

488,456

2024

 

1,953,818

2025

 

1,878,602

2026

 

1,652,952

2027

 

1,652,952

Thereafter

 

4,545,616

Total future amortization expense

$

12,172,396

The Company expects to deduct goodwill for tax purposes in future years. The factors that make up goodwill include entry into new markets not previously accessible and generation of future growth opportunities.