The Joint Corp. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Note 8 - Intangible Assets

Note 8 - Intangible Assets

3 Months Ended

Mar. 31, 2019

Notes to Financial Statements

Intangible Assets Disclosure [Text Block]

Note

Intangible Assets

February 4, 2019,

the Company entered into an agreement under which it repurchased the right to develop franchises in various counties in South Carolina and Georgia. The total consideration for the transaction was

$681,500.

The Company carried a deferred revenue balance associated with these transactions of

$44,334,

representing license fees collected upon the execution of the regional developer agreements. 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.

Intangible assets consist of the following:

	As of March 31, 2019
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Value
Amortized intangible assets:
Reacquired franchise rights	$	1,788,000	$	988,265	$	799,735
Customer relationships		777,000		722,997		54,003
Reacquired development rights		2,050,482		736,698		1,313,784
	$	4,615,482	$	2,447,960	$	2,167,522

	As of December 31, 2018
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Value
Amortized intangible assets:
Reacquired franchise rights	$	1,758,000	$	921,138	$	836,862
Customer relationships		745,000		717,498		27,502
Reacquired development rights		1,413,316		643,620		769,696
	$	3,916,316	$	2,282,256	$	1,634,060

Amortization expense was

$171,873

and

$123,064

for the

three

months ended

March 31, 2019

and

2018,

respectively.

Estimated amortization expense for

2019

and subsequent years is as follows:

2019 (remainder)	$	570,435
2020		741,202
2021		657,152
2022		186,520
2023		12,213
Thereafter		-
Total	$	2,167,522