TILT Holdings Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Intangible Assets

Intangible Assets

6 Months Ended

Jun. 30, 2024

Intangible Assets

Intangible Assets

7. Intangible Assets

Intangible asset balances consisted of the following:


Intangible assets	June 30, 2024		December 31, 2023
Customer relationships	$	85,300	$	85,300
Trademarks		29,000		29,000
License rights⁽¹⁾		2,361		2,361
Patents & technologies		32,900		32,900
Backlog and non-competition agreements		10,406		10,406
Total intangible assets, at cost		159,967		159,967
Less: Accumulated amortization		(81,642)		(75,166)
Total intangible assets, net	$	78,325	$	84,801

(1)License rights primarily consists of indefinite-lived intangible assets, which pertain to licenses for cultivation and processing.

Amortization expense for the three months ended June 30, 2024 and 2023 was $3,238 and $3,255, respectively. Amortization expense for the six months ended June 30, 2024 and 2023 was $6,476 and $6,519, respectively. This amortization expense is included in depreciation and amortization in the condensed consolidated statements of operations and comprehensive loss.

During the three months ended June 30, 2023, the Company determined that its management agreement with CGSF Group, LLC (“CGSF”) was impaired. As a result, the Company recognized an impairment loss of $737 to bring the carrying value of the management agreement intangible asset to zero. This loss is included in impairment loss and loss on disposal of assets in the condensed consolidated statements of operations and comprehensive loss.

The following table outlines the estimated future annual amortization expense for intangible assets as of June 30, 2024:


	Estimated
Years ended December 31,	amortization
Remainder of 2024	$	6,477
2025		12,953
2026		12,796
2027		12,796
2028		12,778
Thereafter		18,325
	$	76,125