AgEagle Aerial Systems Inc. Goodwill & Intangibles Disclosure
Note 6 – Intangibles, Net
As of December 31, 2021, intangible assets, net, other than goodwill, consist of following:
| Name | Estimated Life (Years) | Balance as of January 1, 2021 | Additions | Accumulated Amortization | Impairment | Balance as of December 31, 2021 | ||||||||||||||||||
| Intellectual property/technology | 5 | $ | 231,146 | $ | 5,671,026 | $ | (474,878 | ) | $ | $ | 5,427,294 | |||||||||||||
| Customer base | 5 | 38,400 | 4,411,499 | (402,580 | ) | 4,047,319 | ||||||||||||||||||
| Tradenames and trademarks | 5 | 31,040 | 2,082,338 | (128,142 | ) | 1,985,236 | ||||||||||||||||||
| Non-compete agreement | 4 | 67,042 | 901,198 | (136,739 | ) | 831,501 | ||||||||||||||||||
| Platform development costs | 3 | 72,899 | 1,097,808 | (174,827 | ) | 995,880 | ||||||||||||||||||
| Internal use software | 3 | 278,264 | 278,264 | |||||||||||||||||||||
| Total | $ | 440,527 | $ | 14,442,133 | $ | (1,317,166 | ) | $ | $ | 13,565,494 | ||||||||||||||
As of December 31, 2020, intangible assets, net other than goodwill, consist of the following:
| Name | Estimated Life (Years) | Balance as of January 1, 2020 | Additions | Accumulated Amortization | Impairment | Balance as of December 31, 2020 | ||||||||||||||||||
| Intellectual property/technology | 5 | $ | 317,826 | $ | $ | (86,680 | ) | $ | $ | 231,146 | ||||||||||||||
| Customer base | 5 | 52,800 | (14,400 | ) | 38,400 | |||||||||||||||||||
| Tradenames and trademarks | 5 | 42,680 | (11,640 | ) | 31,040 | |||||||||||||||||||
| Non-compete agreement | 4 | 107,267 | (40,225 | ) | 67,042 | |||||||||||||||||||
| Platform development costs | 3 | 72,899 | 72,899 | |||||||||||||||||||||
| Total | $ | 520,573 | $ | 72,899 | $ | (152,945 | ) | $ | $ | 440,527 | ||||||||||||||
The weighted average remaining amortization period in years is 5.6 years. Amortization expense for the years ended December 31, 2021 and 2020 was $1,317,166 and $152,945, respectively.
For the following fiscal years ending, the future amortization expense is as follows:
| December 31, | ||||||||||||||||||||||||||||
| 2022 | 2023 | 2024 | 2025 | 2026 | Thereafter | Total | ||||||||||||||||||||||
| Intellectual property/ technology | $ | 890,955 | $ | 867,559 | $ | 809,773 | $ | 809,773 | $ | 809,773 | $ | 1,239,462 | $ | 5,427,294 | ||||||||||||||
| Customer base | 1,149,406 | 1,148,134 | 891,150 | 141,145 | 141,145 | 576,340 | 4,047,319 | |||||||||||||||||||||
| Tradenames and trademarks | 218,243 | 215,856 | 208,096 | 208,096 | 208,096 | 926,848 | 1,985,236 | |||||||||||||||||||||
| Non-compete agreement | 474,237 | 357,264 | 831,501 | |||||||||||||||||||||||||
| Platform development costs | 390,235 | 390,235 | 215,408 | 995,880 | ||||||||||||||||||||||||
| Internal use software | 69,566 | 92,755 | 92,755 | 23,189 | 278,264 | |||||||||||||||||||||||
| Total | $ | 3,192,642 | $ | 3,071,803 | $ | 2,217,182 | $ | 1,182,203 | $ | 1,159,014 | $ | 2,742,650 | $ | 13,565,494 | ||||||||||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2021 | Apr 12, 2022 | Showing above |
| 2020 | Mar 31, 2021 | |
| 2019 | Apr 13, 2020 | |
| 2018 | Mar 28, 2019 | |
About Goodwill & Intangibles Disclosures
Goodwill and intangible asset disclosures reveal the premium paid in acquisitions and how management assesses whether that premium retains its value. Since goodwill is no longer amortized under US GAAP, the annual impairment test is the only mechanism that adjusts carrying values downward — making the assumptions behind that test critically important for investors.
Key signals: a history of goodwill impairments suggests management consistently overpays for acquisitions. Watch the gap between reporting unit fair value and carrying amount — when fair value exceeds carrying amount by less than 10-20%, a small decline in business performance could trigger a write-down. For finite-lived intangibles, examine useful life assumptions across customer relationships, technology, and trade names; aggressive estimates inflate near-term earnings. Compare total intangibles-to-total-assets ratios against peers to assess acquisition dependency. Rising goodwill as a percentage of equity can signal balance sheet fragility.