Quarterly report pursuant to Section 13 or 15(d)

Goodwill and Intangible Assets

v3.22.1
Goodwill and Intangible Assets
3 Months Ended
Mar. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Intangible Assets

Note 7 – Goodwill and Intangible Assets

Goodwill represents the excess of cost over the fair value of identifiable net assets acquired related to the original purchase of the various franchise businesses and acquisition of company-owned transition studios. Goodwill is not amortized but is tested annually for impairment or more frequently if indicators of potential impairment exist. The Company has not identified any events or circumstances at March 31, 2022 that would require an interim goodwill impairment test. The carrying value of goodwill at March 31, 2022 and December 31, 2021 totaled $169,073.

Intangible assets consisted of the following:

 

 

 

 

 

March 31, 2022

 

 

December 31, 2021

 

 

 

Amortization
period
(years)

 

Gross
amount

 

 

Accumulated
amortization

 

 

Net
amount

 

 

Gross
amount

 

 

Accumulated
amortization

 

 

Net
amount

 

Trademarks

 

10

 

$

10,920

 

 

$

(1,067

)

 

$

9,853

 

 

$

10,920

 

 

$

(794

)

 

$

10,126

 

Franchise agreements

 

7.5 – 10

 

 

69,500

 

 

 

(19,208

)

 

 

50,292

 

 

 

69,500

 

 

 

(17,166

)

 

 

52,334

 

Non-compete agreement

 

5

 

 

1,400

 

 

 

(1,352

)

 

 

48

 

 

 

1,400

 

 

 

(1,282

)

 

 

118

 

Web design and domain

 

3 – 10

 

 

430

 

 

 

(113

)

 

 

317

 

 

 

430

 

 

 

(86

)

 

 

344

 

Deferred video production costs

 

3

 

 

2,686

 

 

 

(1,271

)

 

 

1,415

 

 

 

2,370

 

 

 

(1,036

)

 

 

1,334

 

Total definite-lived intangible assets

 

 

 

 

84,936

 

 

 

(23,011

)

 

 

61,925

 

 

 

84,620

 

 

 

(20,364

)

 

 

64,256

 

Indefinite-lived intangible assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Trademarks

 

N/A

 

 

72,607

 

 

 

 

 

 

72,607

 

 

 

72,607

 

 

 

 

 

 

72,607

 

Total intangible assets

 

 

 

$

157,543

 

 

$

(23,011

)

 

$

134,532

 

 

$

157,227

 

 

$

(20,364

)

 

$

136,863

 

 

Amortization expense was $2,648 and $1,339, for the three months ended March 31, 2022 and 2021, respectively.

The anticipated future amortization expense of intangible assets is as follows:

 

Remainder of 2022

 

$

7,705

 

2023

 

 

9,900

 

2024

 

 

9,589

 

2025

 

 

9,200

 

2026

 

 

6,502

 

Thereafter

 

 

19,029

 

Total

 

$

61,925