Quarterly report pursuant to Section 13 or 15(d)

Intangible Assets

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Intangible Assets
6 Months Ended
Jun. 30, 2021
Goodwill and Intangible Assets Disclosure [Abstract]  
Intangible Assets Intangible Assets
On January 1, 2021, the Company entered into an agreement under which the Company repurchased the right to develop franchises in various counties in Georgia. The total consideration for the transaction was $1,388,700. The Company carried a deferred revenue balance associated with this transaction of $35,679, representing the unrecognized fee collected upon the execution of the regional developer agreement. The Company accounted for the termination of development rights associated with unsold or undeveloped franchises as a cancellation, and the associated deferred revenue was netted against the aggregate purchase price. The Company recognized the net amount of $1,353,021 as reacquired development rights in January 2021, which is amortized over the remaining original contract period of approximately 13 months.
On April 1, 2021, the Company recognized $2,532,727 and $1,191,145 of reacquired franchise rights and customer relationships, respectively, from the acquisitions (reference Note 3).
Intangible assets consist of the following:
As of June 30, 2021
Gross Carrying
Amount
Accumulated
Amortization
Net Carrying
Value
Intangible assets subject to amortization:
Reacquired franchise rights
$ 5,779,621  $ (2,556,203) $ 3,223,418 
Customer relationships
2,543,120  (1,364,266) 1,178,854 
Reacquired development rights
4,406,221  (2,632,064) 1,774,157 
$ 12,728,962  $ (6,552,533) $ 6,176,429 
As of December 31, 2020
Gross Carrying
Amount
Accumulated
Amortization
Net Carrying
Value
Intangible assets subject to amortization:
Reacquired franchise rights $ 3,246,894  $ (2,107,730) $ 1,139,164 
Customer relationships 1,351,975  (1,130,800) 221,175 
Reacquired development rights 3,053,201  (1,548,534) 1,504,667 
$ 7,652,070  $ (4,787,064) $ 2,865,006 
Amortization expense related to the Company’s intangible assets was $991,981 and $351,114 for the three months ended June 30, 2021 and 2020, respectively. Amortization expense was $1,765,469 and $707,734 for the six months ended June 30, 2021 and 2020, respectively.
Estimated amortization expense for 2021 and subsequent years is as follows:
Amount
2021 (remainder) $ 1,866,159 
2022 2,036,549 
2023 982,337 
2024 463,547 
2025 199,118 
Thereafter 628,719 
Total expected amortization expense $ 6,176,429