Note 7 - Long-Lived Assets

3 Months Ended

Mar. 31, 2012

7. Long-Lived Assets

The Company regularly performs reviews of its long-lived assets to determine if facts or circumstances are present, either internal or external, which would indicate that the carrying values of its long-lived assets may not be recoverable. For more details, refer to the Summary of Significant Accounting Policies in Note 1 to the Consolidated Financial Statements in the Annual Report on Form 10-K for the fiscal year ended December 31, 2011.

Property and Equipment, Net

The components of property and equipment, net, as of March 31, 2012 and December 31, 2011 were as follows:

	March 31, 2012			December 31, 2011
	(in thousands)

Rigs and workover equipment	$	27,415		$	11,750
Other equipment		11,971			3,205
Leasehold improvements		6,075			5,677
Vehicles		1,018			648
Furniture and fixtures		8			100
Assets in progress		225			-
		46,712			21,380
Accumulated depreciation		(1,338	)		(320	)
Property and equipment, net	$	45,374		$	21,060

Depreciation expense for the three-month period ended March 31, 2012 aggregated $1.0 million, with $0.9 million in “Cost of revenues” and $0.1 million in “Selling, general and administrative” expenses in the Condensed Statement of Operations. There was no depreciation expense in the three-month period ended April 1, 2011.

During the three-month period ended March 31, 2012, the Company wrote down $0.1 million of property and equipment from The Show to zero-value, as The Show is not meeting forecasted projections, with no expectation to perform as represented when acquired. This write-down is included in “Selling, general and administrative” expenses in the Condensed Statement of Operations.

Intangible Assets, Net

The components of intangible assets, net, as of March 31, 2012 were as follows:

			Accumulated					Amortization	Estimated
	Cost		Amortization			Net		Method	Useful Life
	(in thousands)
Sports-Related:
Customer relationships	$	235	$	(31	)		204	Straight-line	5 years

Oilfield Servicing:
Customer relationships		19,000		(711	)		18,289	Accelerated	10 years
Trade names		900		(120	)		780	Accelerated	5 years
		19,900		(831	)		19,069
Intangible assets, net	$	20,135	$	(862	)	$	19,273

The components of intangible assets, net, as of December 31, 2011 were as follows:

			Accumulated					Amortization	Estimated
	Cost		Amortization			Net		Method	Useful Life
	(in thousands)
Sports-Related:
Customer relationships	$	235	$	(20	)		215	Straight-line	5 years

Oilfield Servicing:
Customer relationships		4,700		(29	)		4,671	Accelerated	10 years
Trade names		900		-			900	Accelerated	5 years
		5,600		(29	)		5,571
Intangible assets, net	$	5,835	$	(49	)	$	5,786

Amortization expense for the three-month periods ended March 31, 2012 and April 1, 2011 was $0.8 million and $0, respectively, and is included in “Selling, general and administrative” expenses in the Condensed Statements of Operations.

Estimated aggregate future amortization expenses for the next five years for the intangible assets by reporting segment are as follows:

			Oilfield
	Sports-Related		Servicing
	(in thousands)
For the year ended December 31:
2012 (remaining nine months)	$	35	$	3,183
2013		47		3,295
2014		47		2,585
2015		47		2,126
2016		27		1,669
	$	203	$	12,858

Goodwill

During the three-month period ended March 31, 2012, the Company wrote off goodwill from The Show of $1.7 million, as The Show is not meeting forecasted projections, with no expectation to perform as represented when acquired. This is included in “Selling, general and administrative” expenses in the Condensed Statement of Operations.

Goodwill by reporting segment as of March 31, 2012 was as follows:

	Sports-Related			Oilfield Services		Total
	(in thousands)

Balance, December 31, 2011	$	1,989		$	6,255	$	8,244
Acquired goodwill		-			10,126		10,126
Impairment loss		(1,796	)		-		(1,796	)
Balance, March 31, 2012	$	193		$	16,381	$	16,574