GOODWILL AND INTANGIBLE ASSETS

12 Months Ended

Dec. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND INTANGIBLE ASSETSGoodwill

In connection with the Merger Transactions with Cibus Global, the Company recognized goodwill totaling $585.3 million. The company had no goodwill prior to the Merger Transactions. Goodwill represents future economic benefits arising from acquiring Cibus Global, primarily due to its strong market position and its assembled workforce that are not individually identified and separately recognized as intangible assets. None of the goodwill recognized is expected to be deductible for income tax purposes.

The following table presents the changes in goodwill during the year ended December 31, 2023.


In Thousands	Goodwill
Balance as of December 31, 2022	$	—
Acquired from merger with Cibus Global, LLC	585,266
Impairment	(150,368)
Balance as of December 31, 2023	$	434,898

Intangible Assets

Intangible assets as of December 31, 2023, were as follows:


In Thousands	Gross Carrying Amount		Accumulated Amortization		Intangible Assets, Net
Developed technology	$	14,148	$	413	$	13,735
Trade name	22,230		648		21,582
Other	150		56		94
Total	$	36,528	$	1,117	$	35,411

During the year ended December 31, 2023, the Company impaired all of the in-process R&D indefinite-lived intangible assets acquired in connection with the Merger Transactions with Cibus Global by $99.0 million. As such, there is no longer a carrying value for the Company's in-process R&D indefinite-lived intangible assets as of December 31, 2023.

Intangible assets as of December 31, 2022, were immaterial.

Total amortization expense is as follows:


	Year Ended December 31,
In Thousands		2023		2022
Amortization expense		$	1,125	$	21

As of December 31, 2023, amortization expense for each of the next five years is estimated as follows:


In Thousands	Amortization Expense

2024	$	1,833
2025	$	1,833
2026	$	1,833
2027	$	1,833
2028	$	1,833

Goodwill and indefinite-lived intangible assets impairment

The Company began its annual impairment test by performing the step zero qualitative assessment. Based on its assessment of qualitative factors, including a decline in the Company's stock price and its strategic realignment announced in the fourth quarter of 2023, the Company concluded it was more likely than not that the carrying values of its reporting unit and in-process R&D indefinite-lived intangible assets exceeded their fair values. The Company performed a quantitative analysis and concluded that the carrying values of its in-process R&D indefinite-lived intangible assets and its reporting unit both exceeded their fair values. Management makes critical assumptions and estimates in completing impairment assessments of goodwill and indefinite-lived intangible assets. The Company utilized the discounted cash flow method to calculate the fair value for its goodwill and the multi-period excess earnings method to calculate the fair value of its indefinite-lived intangible assets. The Company's cash flow projections look several years into the future and include assumptions on variables such as future royalties and operating margins, economic conditions, probability of success, market competition, inflation, and discount rates. The Company determined its goodwill and in-process R&D indefinite-lived intangible assets were impaired by $150.4 million and $99.0 million, respectively, for the year ended December 31, 2023, which was recorded in the accompanying consolidated statements of operations.