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INTANGIBLE ASSETS | 12 Months Ended
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Dec. 31, 2024
Goodwill and Intangible Assets Disclosure [Abstract] |
INTANGIBLE ASSETS |
5. INTANGIBLE ASSETS
Intangible assets are recorded at cost less accumulated amortization and impairment losses, if any. Intangible assets acquired in a business combination are measured at fair value as of the acquisition date. Amortization of definite life intangible assets is provided on a straight-line basis over their estimated useful lives. The estimated useful lives, residual values, and amortization methods for intangible assets are reviewed by the Company at each year end, and any changes in estimates are accounted for prospectively. As of December 31, 2024 and December 31, 2023, intangible assets consisted of the following:
|  | Licenses |  | Tradenames |  | Technology |  | Total
Cost |  |  |  |  |  |  |  |
Balance as of January 1, 2024 |  | $ | 1,269,326 |  |  | $ | 54,166 |  |  | $ | 6,431 |  |  | $ | 1,329,923 |
Additions from business combination |  | 29,900 |  |  | — |  |  | — |  |  | 29,900 |
Adjustments to purchase price allocation |  | 3,100 |  |  | — |  |  | — |  |  | 3,100 |
Impairment |  | (379,968) |  |  | (9,058) |  |  | (885) |  |  | (389,911) |
Balance as of December 31, 2024 |  | $ | 922,358 |  |  | $ | 45,108 |  |  | $ | 5,546 |  |  | $ | 973,012 |
Accumulated Amortization |  |  |  |  |  |  |  |
Balance as of January 1, 2024 |  | 225,751 |  |  | 15,001 |  |  | 3,025 |  |  | 243,777 |
Amortization |  | 79,107 |  |  | 5,194 |  |  | 1,006 |  |  | 85,307 |
Impairment |  | (86,280) |  |  | (3,337) |  |  | (460) |  |  | (90,077) |
Balance as of December 31, 2024 |  | $ | 218,578 |  |  | $ | 16,858 |  |  | $ | 3,571 |  |  | $ | 239,007 |
Net Book Value |  |  |  |  |  |  |  |
Balance as of January 1, 2024 |  | 1,043,575 |  |  | 39,165 |  |  | 3,406 |  |  | 1,086,146 |
Balance as of December 31, 2024 |  | $ | 703,780 |  |  | $ | 28,250 |  |  | $ | 1,975 |  |  | $ | 734,005 |
|  | Licenses |  | Tradenames |  | Technology |  | Total
Cost |  |  |  |  |  |  |  |
Balance as of January 1, 2023 |  | $ | 1,274,981 |  |  | $ | 54,166 |  |  | $ | 6,431 |  |  | $ | 1,335,578 |
Impairment |  | (7,605) |  |  | — |  |  | — |  |  | (7,605) |
Other Additions(1) |  | 1,950 |  |  | — |  |  | — |  |  | 1,950 |
Balance as of December 31, 2023 |  | $ | 1,269,326 |  |  | $ | 54,166 |  |  | $ | 6,431 |  |  | $ | 1,329,923 |
Accumulated Amortization |  |  |  |  |  |  |  |
Balance as of January 1, 2023 |  | 143,246 |  |  | 9,579 |  |  | 1,987 |  |  | 154,812 |
Amortization |  | 84,997 |  |  | 5,422 |  |  | 1,038 |  |  | 91,457 |
Impairment |  | $ | (2,492) |  |  | $ | — |  |  | $ | — |  |  | $ | (2,492) |
Balance as of December 31, 2023 |  | $ | 225,751 |  |  | $ | 15,001 |  |  | $ | 3,025 |  |  | $ | 243,777 |
Net Book Value |  |  |  |  |  |  |  |
Balance as of January 1, 2023 |  | 1,131,735 |  |  | 44,587 |  |  | 4,444 |  |  | 1,180,766 |
Balance as of December 31, 2023 |  | $ | 1,043,575 |  |  | $ | 39,165 |  |  | $ | 3,406 |  |  | $ | 1,086,146 |
(1) The Company obtained a license following regulatory approval where payment consideration occurred in prior periods.
5. INTANGIBLE ASSETS (Continued)
The Company recorded amortization expense for the years ended December 31, 2024, 2023 and 2022 of $85,307, $91,457, and $97,344, respectively. Amortization periods of assets with finite lives are based on management’s estimates at the date of acquisition. On an annual basis, the Company reviews the estimated useful lives, residual values and amortization methods used for each identifiable intangible asset acquired. During the 2024 annual review, management determined that (i) certain Pennsylvania retail licenses were impaired (ii) Arizona cultivation (wholesale) and Maryland retail tradenames were impaired and (iii) Arizona cultivation (wholesale) technology was impaired. The Company recorded intangible asset impairment charges of $293,688 related to the Pennsylvania retail licenses, $5,687 related to the Arizona cultivation (wholesale) tradenames, $34 related to the Maryland retail tradenames and $425 related to the Arizona cultivation (wholesale) technology, on the remaining net book value during the year ended December 31, 2024. During the 2023 and 2022 annual reviews, management determined that the Massachusetts cultivation (wholesale) license was impaired and determined that the Arizona cultivation (wholesale) license was impaired, with respect to such years. The Company recorded intangible asset impairment charges of $5,113 and $116,151 on the remaining net book value during the years ended December 31, 2023 and December 31, 2022, respectively. The following table outlines the estimated annual amortization expense related to intangible assets as of December 31, 2024:
Year Ending December 31: |  | Estimated Amortization
2025 |  | $ | 66,979 |
2026 |  | 66,332 |
2027 |  | 66,273 |
2028 |  | 66,259 |
2029 |  | 66,257 |
Thereafter |  | 401,905 |
Total |  | $ | 734,005 |

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