Intangible and Other Assets

12 Months Ended

Dec. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

6. INTANGIBLE AND OTHER ASSETS

Intangible Assets

The Company has intangible assets not subject to amortization, which include certain costs to obtain or defend regulatory authorizations. These costs primarily include efforts related to the enhancement of the Company's licensed MSS spectrum to provide terrestrial wireless services as well as costs with international regulatory agencies to obtain similar terrestrial authorizations outside of the United States. The Company also has intangible assets subject to amortization, which primarily include developed technology and definite lived MSS licenses.

The gross carrying amount and accumulated amortization of the Company's intangible assets consist of the following (in thousands):


	December 31, 2023						December 31, 2022
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Intangible Assets Not Subject to Amortization	$	16,929	$	—	$	16,929	$	16,803	$	—	$	16,803

Intangible Assets Subject to Amortization:
Developed technology	$	12,170	$	(8,235)	$	3,935	$	9,113	$	(7,292)	$	1,821
Regulatory authorizations	5,370		(1,850)		3,520		3,722		(1,316)		2,406
Intellectual property assets in progress	25,980		—		25,980		—		—		—
Other intangible assets in progress	10,289		—		10,289		9,377		—		9,377
	$	53,809	$	(10,085)	$	43,724	$	22,212	$	(8,608)	$	13,604

Total	$	70,738	$	(10,085)	$	60,653	$	39,015	$	(8,608)	$	30,407

During 2023, intellectual property assets in progress were assumed in the License Agreement (discussed further in Note 2: License Agreement). As of December 31, 2023, these assets were still in the development phase and will be amortized over their useful lives once placed into service.

For the year ended December 31, 2023, the Company recorded amortization expense on these intangible assets of $1.4 million. Amortization expense is recorded in operating expenses in the Company’s consolidated statements of operations.

Excluding the effects of any acquisitions, dispositions or write-downs subsequent to December 31, 2023, total estimated annual amortization of intangible assets is as follows (in thousands):


2024	$	1,575
2025	1,254
2026	1,225
2027	1,161
2028	646
Thereafter	1,594
Total	$	7,455

Goodwill

As of December 31, 2023, the carrying amount of goodwill was $30.6 million and is associated with the Company's only operating segment, its MSS business. Goodwill is deductible for tax purposes. This goodwill was recorded during 2023 in connection with the License Agreement (refer to Note 2: License Agreement for further discussion) and represented the excess of the purchase price of the net identifiable assets acquired. At the transaction date, the goodwill was attributable to the workforce of the acquired entity and significant synergies. There were no material changes to the value of goodwill between the initial purchase date, August 29, 2023, and December 31, 2023. The Company's annual goodwill impairment test was completed on November 30, 2023 and the qualitative assessment indicated that it was more likely-than-not that the estimated fair value of the reporting unit exceeded the carrying value of goodwill.

Other Assets

Other assets consist of the following (in thousands):


	December 31,
	2023		2022
Costs to obtain and fulfill a contract (Note 1)	$	6,886	$	1,770
Long-term accounts receivable	5,094		—
International tax receivables (Note 13)	2,791		3,552
Embedded derivative assets within the 2023 Funding Agreement (Note 8)	1,295		—
Other long-term assets	3,703		2,696
Total other assets	$	19,769	$	8,018

Long-term accounts receivable represents an unconditional right to consideration for equipment delivered to one customer that will be billed over the next five years; the long-term portion represents the amount that will be billed beyond the next twelve months. Other long-term assets include primarily ERP implementation costs, recoverable tariffs and other long-term deposits.