Annual report pursuant to Section 13 and 15(d)

Intangible Assets, Net

v3.20.1
Intangible Assets, Net
 12 Months Ended
Dec. 31, 2019
Goodwill and Intangible Assets Disclosure [Abstract]  
Intangible Assets, Net

8. INTANGIBLE ASSETS, NET

 

GOODWILL

 

Goodwill consist of the following at December 31, 2019 and 2018:

 

    December 31, 2019     December 31, 2018  
Beginning Balance   $ 10,564,353     $ 12,647,806  
Impairment     (2,025,720 )     (1,191,111 )
Reclassification to discontinued operations     -       (716,112 )
Foreign currency translation gain (loss)     29,255       (176,230 )
Ending Balance   $ 8,567,888     $ 10,564,353  

 

OTHER INTANGIBLE ASSETS

 

Franchise and trademark/tradename intangible assets consist of the following at December 31, 2019 and December 31, 2018:

 

        December 31, 2019     December 31, 2018  
Trademark, Tradenames:                    
American Roadside Burger   10 years   $ 1,786,930     $ 1,786,930  
BGR: The Burger Joint   Indefinite     985,996       1,430,000  
Little Big Burger   Indefinite     1,550,000       1,550,000  
          4,322,926       4,766,930  
Acquired Franchise Rights                    
BGR: The Burger Joint   7 years     827,757       827,757  
                     
Franchise License Fees:                    
Hooters Pacific NW   20 years     74,507       89,507  
Hooters UK   5 years     12,917       12,422  
          87,424       101,929  
Total Intangibles at cost         5,238,107       5,696,616  
Accumulated amortization         (1,581,112 )     (1,226,801 )
Intangible assets, net       $ 3,656,995     $ 4,469,815  

 

    Twelve Months Ended  
    December 31, 2019     December 31, 2018  
Amortization expense   $ 373,776     $ 419,642  

 

Management tested its long-lived assets for impairment as of December 31, 2019 comparing each brand’s fair value to its carrying value. That assessment included the assumption that management would continue to hold and generate cash flows over a period of years. Those cash flows were discounted using the income approach and compared to the carrying value of the tradename. Based on the royalty-relief method, management determined there was a tradename/trademark impairment of BGR: The Burger Joint of approximately $440,000.