JOURNY.tv Asset Acquisition |
12 Months Ended |
|---|---|
Feb. 28, 2026 | |
| JOURNY.tv Acquisition [Member] | |
| Business Combination [Line Items] | |
| JOURNY.tv Asset Acquisition | NOTE 5 – JOURNY.tv Asset Acquisition
On April 1, 2025, the Company entered into an asset purchase agreement (the “JOURNY.tv Purchase Agreement”) with Ovation LLC (“Ovation”), pursuant to which the Company purchased assets, including without limitation trademarks, domains, apps and certain agreements, and assumed certain liabilities related to Ovation’s JOURNY.tv business (the “JOURNY.tv Acquisition”). The JOURNY.tv Acquisition closed on April 1, 2025.
Pursuant to the JOURNY.tv Purchase Agreement, as consideration for the JOURNY.tv Acquisition, the Company paid Ovation $300,000 in cash at closing and issued Ovation restricted shares of Company common stock at $ per share, valued at $115,200. In addition, the Purchase Agreement requires the Company to make license fee payments to Ovation totaling $336,801 over the period from April 2025 through October 2027, which were recorded at their present value of $299,800, discounted using the Company’s estimated cost of debt of 12.03%. Total purchase consideration was $715,000. The difference between the undiscounted payments and their present value will be recognized as interest expense using the effective interest method over the term of the license.
In connection with the JOURNY.tv Acquisition, on April 1, 2025, the Company and Ovation also entered into a License Agreement (the “License Agreement”), pursuant to which Ovation granted the Company the non-exclusive right, throughout the territories and for the term set forth therein, to exhibit, promote, market, advertise, publicize and/or otherwise exploit the programs listed in the License Agreement in the media of (i) FAST via the JOURNY.tv Channel and (ii) Video On Demand via the JOURNY.tv Channel. Pursuant to the License Agreement, Ovation shall not license any unaffiliated third party the right to exhibit certain of the programs subject to the License Agreement and shall not use certain of the programs subject to the License Agreement on its owned or operating streaming platforms (subject to certain exceptions). As consideration for the rights granted under the License Agreement, the Company agreed to pay Ovation an aggregate non-refundable license fee of $336,801. Either party may terminate the License Agreement in the event of a material default by the other party that is not cured within fifteen days after the defaulting party receives notice of such default.
The transaction was accounted for as an asset acquisition because while inputs were acquired (in the form of trademarks, distribution agreements, content licenses, and service agreements), there is not a continuation of revenues before and after the transaction. That is, due to the significant rebranding and redevelopment of the inputs acquired, the JOURNY.tv assets are not producing revenue post-closing of the transaction. Additionally, an organized workforce with the necessary skills and experience to create outputs was not included in the transaction. As such, the transaction does not meet the definition of a business and is considered an asset acquisition.
On the acquisition date, the fair value of the intangible assets acquired was $715,000, excluding $6,700 of acquisition-related direct costs which were expensed as incurred. The intangible assets have a weighted average estimated useful life of 16.7 years.
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