Quarterly report pursuant to Section 13 or 15(d)

Intangible Assets and Goodwill

v3.22.2
Intangible Assets and Goodwill
6 Months Ended
Jun. 30, 2022
Goodwill and Intangible Assets Disclosure [Abstract]  
Intangible Assets and Goodwill

Note 6. Intangible Assets and Goodwill

Intangible Assets

Our recognized intangible assets consist of patents and the unpatented technological know-how of Danimer Catalytic Technologies. Our legacy patents were initially recorded at cost. The values of Danimer Catalytic Technologies' patents and unpatented know-how are inseparable and represent their acquisition-date fair value, less subsequent amortization.

We capitalize the costs of patent acquisition as well as the costs of the defense of patents when we believe a successful defense of that patent is probable and that a successful defense increases the value of the patent. Patent costs are amortized on a straight-line basis over their estimated useful lives, which range from 13 to 20 years. Our intangible portfolio has an estimated weighted average useful life of 19 years.

Intangible assets, net, consisted of the following:

 

 

June 30,

 

 

December 31,

 

(in thousands)

 

2022

 

 

2021

 

Intangible assets, gross

 

$

93,447

 

 

$

93,244

 

Capitalized patent costs not yet subject to amortization

 

 

1,003

 

 

 

869

 

Intangible assets subject to amortization, gross

 

 

92,444

 

 

 

92,375

 

Accumulated amortization, beginning balance

 

 

(8,585

)

 

 

(6,496

)

Amortization in the quarter ended:

 

 

 

 

 

 

March 31

 

 

(1,181

)

 

 

(124

)

June 30

 

 

(1,186

)

 

 

(125

)

September 30

 

 

-

 

 

 

(657

)

December 31

 

 

-

 

 

 

(1,183

)

Accumulated amortization, ending balance

 

 

(10,952

)

 

 

(8,585

)

Intangible assets subject to amortization, net

 

 

81,492

 

 

 

83,790

 

Total intangible assets, net

 

$

82,495

 

 

$

84,659

 

We report amortization expense primarily in research and development expense.

Goodwill

Goodwill is tested for impairment at the reporting unit level (operating segment or one level below an operating segment) on an annual basis each November 1st and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. As a result of the continuation of our sustained market capitalization level below our book equity value, we noted that there were indicators that an impairment loss may have occurred. We performed an interim qualitative impairment assessment related to the triggering event noted above, and determined that it was more likely than not that our goodwill and long-lived assets were not impaired.

Changes in the carrying amount of goodwill were as follows:

 

 

June 30,

 

(in thousands)

 

2022

 

Balance at beginning of period

 

$

62,649

 

Adjustment of estimate of fair value of liabilities assumed related to Danimer Catalytic Technologies acquisition

 

 

14

 

Balance at end of period

 

$

62,663