INTANGIBLE ASSETS - SOFTWARE, LICENSES, TRADEMARKS, DEVELOPED TECHNOLOGY, CUSTOMER RELATIONSHIPS, AND NON-COMPETE AGREEMENTS

9 Months Ended

Sep. 30, 2025

INTANGIBLE ASSETS - SOFTWARE, LICENSES, TRADEMARKS, DEVELOPED TECHNOLOGY, CUSTOMER RELATIONSHIPS, AND NON-COMPETE AGREEMENTS

INTANGIBLE ASSETS - SOFTWARE, LICENSES, TRADEMARKS, DEVELOPED TECHNOLOGY, CUSTOMER RELATIONSHIPS, AND NON-COMPETE AGREEMENTS

NOTE 8 – INTANGIBLE ASSETS – SOFTWARE, LICENSES, TRADEMARKS, DEVELOPED TECHNOLOGY, CUSTOMER RELATIONSHIPS, AND NON-COMPETE AGREEMENTS

Software represents software licenses as well as the costs of internally developed gaming software (e.g., a new sports betting platform which is classified as intangible construction in process). Capitalized software costs are amortized based on the straight-line method over the remaining estimated economic life of the product.

During the nine months ended September 30, 2025, and 2024, respectively, software development costs of $6,454,037 and $6,303,398, were incurred and capitalized.

Intangible construction in process mainly represents the development of new software in Montenegro and Malta for a sports betting platform. During the nine months ended September 30, 2025, and 2024, respectively, costs of $7,447,361 and $6,158,259 were incurred and capitalized, while a total of $5,450,251 was placed in service in 2025.

We anticipated that the majority of intangible construction in progress will be placed in service in stages beginning during the end of 2025 and continuing in 2026, depending on the progress of the software development.

Licenses relate to operational gaming licenses issued in Bosnia, Cyprus and Brazil. During the nine months ended September 30, 2025, and 2024, respectively, costs of $915,994 and $145,139, were incurred and capitalized. The licenses are amortized over the life of the licenses.

Other intangible assets relate to retail agent partner relationships and online customer relationships identified during the acquisition of Bit Tech Tanzania in the amount of $1,593,898, as well as the purchase of the domain magicbet777.com by Meridianbet Brazil LTDA in the amount of $2,371,823. Other intangible assets are amortized over 5 years.

Intangible assets related to software and website are amortized on a straight-line basis over their expected useful lives, estimated to be 5 years.

Amortization expenses related to intangible assets were $2,575,834 and $1,962,157 for the three months ended September 30, 2025, and 2024, respectively and $7,193,854 and $4,317,523 for the nine months ended September 30, 2025, and 2024, respectively.

The following table details the carrying values of the Company’s intangible assets:

Definite-lived intangible assets		As of September 30, 2025				As of December 31, 2024
Intangible construction in process		$	12,585,832			$	11,354,044
Licenses			6,605,987				5,689,993
Software			20,500,889				14,780,382
Trademarks and tradenames			12,207,826				12,183,561
Developed technology			3,100,000				3,100,000
Customer relationships			17,955,724				17,950,000
Non-compete agreement			292,914				290,000
Other intangible assets			3,965,721				3,451,010
Gross intangible assets			77,214,893				68,798,990
Less: accumulated impairment and amortization
Licenses amortization			(1,526,805	)			(519,702	)
Software amortization			(8,022,813	)			(6,718,227	)
Trademarks and tradenames amortization			(1,766,789	)			(838,532	)
Developed technology			(930,006	)			(465,003	)
Customer relationships			(5,349,645	)			(2,656,083	)
Non-compete agreement			(170,104	)			(61,186	)
Other intangible assets amortization			(1,895,274	)			(1,146,800	)
Total accumulated impairment and amortization			(19,661,436	)			(12,405,533	)
Net definite-lived intangible assets		$	57,553,457			$	56,393,457

The table below shows expected amortization expenses for the next five years of intangible assets recorded as of September 30, 2025:

Year Ending December 31,		Estimated Amortization
2025		$	3,796,535
2026			13,486,162
2027			11,811,810
2028			11,291,102
2029			7,619,916
Thereafter			9,547,932
Total future amortization		$	57,553,457

The following table identifies the intangible assets resulting from the Meridian Purchase, as described in greater detail in “Note 22 – MeridianBet Group Purchase Agreement”:

Description		Useful life		Amount
Trade names and trademarks		10 Years		$	9,700,000
Developed technology		5 Years			3,100,000
Customer relationships		5 Years			17,400,000
Non-compete agreement		3 Years			10,000
Total				$	30,210,000

The fair value estimate for all identifiable intangible assets is based on assumptions that market participants would use in pricing an asset, based on the most advantageous market for the asset (i.e., its highest and best use).