XML 24 R12.htm IDEA: XBRL DOCUMENT

Note 6 - Business Acquisitions

3 Months Ended

Mar. 31, 2023

Notes to Financial Statements

Mergers, Acquisitions and Dispositions Disclosures [Text Block]

NOTE 6. BUSINESS ACQUISITIONS

2023 Acquisitions

We did not complete any acquisitions during the first quarter of 2023.

2022 Acquisitions

During the year ended December 31, 2022, we completed the acquisition of a broadband service provider and its related assets as well as an outdoor advertising business and its related assets. These acquisitions were accounted for as business combinations under the provisions of ASC 805. A summary of the acquisitions is provided below.

InfoWest & Go Fiber

On April 1, 2022, FIF St George, LLC, our wholly-owned subsidiary, acquired substantially all of the business assets of InfoWest, Inc. (“InfoWest”) and Go Fiber LLC (“Go Fiber”), who are fiber and fixed wireless internet service providers located in St. George, Utah. The InfoWest and Go Fiber businesses together provide high-speed internet services to over 20,000 customers throughout Southern and Central Utah, Northern Arizona and Moapa Valley, Nevada.

Under the terms of the Agreement, FIF St George, LLC assumed only certain liabilities of InfoWest and Go Fiber. The total purchase price of $48,573,149 was paid 80% in cash, and the remaining 20% of the purchase price was paid by issuing to InfoWest and Go Fiber 20% of the outstanding equity of FIF St George, LLC. A portion of the cash purchase price is held in escrow to provide a source of indemnification for any breaches of the representations and warranties, covenants and other obligations of InfoWest and Go Fiber under the Agreement. At any time, InfoWest and Go Fiber have the option, but not the obligation, to sell FIF St George, LLC its entire ownership interest in FIF St George, LLC. FIF St George, LLC would be obligated to purchase the units and pay for the purchase over a three-year period if InfoWest and Go Fiber elect to exercise this option. Subject to the occurrence of certain future events, FIF St George, LLC has the option, but not the obligation, to purchase InfoWest and Go Fiber’s ownership interest in FIF St George, LLC, with payment due in full upon exercise of the option. The purchase price for the units under either of these put/call options is based upon a multiple of earnings before interest, taxes, depreciation, amortization, and certain other expenses. The 20% interest owned by InfoWest and Go Fiber is included within "Redeemable Noncontrolling interest" in our consolidated Balance Sheets.

The following is a summary of the allocation of the purchase price, which includes the final fair value allocation of the assets acquired and liabilities assumed:

		*InfoWest & Go Fiber*
Assets Acquired
Property, plant and equipment		$	5,983,410
Trade names and trademarks			7,300,000
Customer relationships			16,900,000
Goodwill			18,071,004
Right of use assets			3,155,434
Other			358,614

Total Assets Acquired			51,768,462

Liabilities Assumed
Lease liabilities			3,149,194
Other			46,119

Total Liabilities Assumed			3,195,313

Total		$	48,573,149

The intangible assets include customer relationships and trade names and trademarks which have useful lives of ten years and twenty years, respectively.

Elevation

On November 21, 2022, our subsidiary, LMO, purchased the outdoor advertising assets of Elevation Outdoor Advertising, which we refer to as “Elevation,” based in Knoxville, TN for a purchase price of $14,239,257. Elevation was founded in 2002 and operates over 265 billboard faces, including 8 digital displays, in Knoxville and East Tennessee. Due to the timing of the transaction, the initial accounting for the business combination is incomplete. We are still in the process of obtaining and assessing documentation of the contracts for customer relationships and detailed reports for structures and permits. The provisional purchase price allocation is based on internal information derived from our previous acquisitions in the Midwestern United States.

		Elevation
Assets Acquired
Property, plant and equipment		$	3,717,734
Customer relationships			2,484,000
Goodwill			8,017,554
Right of use assets			2,098,194
Other			310,794

Total Assets Acquired			16,628,276

Liabilities Assumed
Accounts payable and other			290,825
Lease liabilities			2,098,194

Total Liabilities Assumed			2,389,019

Total		$	14,239,257

The intangible assets include customer relationships and permits which have useful lives of fifteen and ten years, respectively.

Pro Forma Information

The following is the unaudited pro forma information assuming all business acquisitions occurred on January 1, 2022. For all of the business acquisitions depreciation and amortization have been included in the calculation of the pro forma information provided below, based upon the actual acquisition costs. Depreciation is computed on the straight-line method over the estimated remaining economic lives of the assets, ranging from two years to fifteen years. Amortization is computed on the straight-line method over the estimated useful lives of the assets ranging from two to fifty years.

For the Three Months Ended

March 31,

2023

2022

Revenue
$ 22,815,785 $ 21,045,883

Net (Loss) Income Attributable to Common Stockholders
$ (3,321,154 ) $ 17,483,060

Basic Net (Loss) Income per Share
$ (0.11 ) $ 0.59

Diluted Net (Loss) Income per Share
$ (0.11 ) $ 0.59

Basic Weighted Average Class A and Class B Common Shares Outstanding
30,524,067 29,698,361

Diluted Weighted Average Class A and Class B Common Shares Outstanding
30,587,745 29,765,082

The information included in the pro forma amounts is derived from historical information obtained from the sellers of the businesses.