INTANGIBLE ASSETS

9 Months Ended

Sep. 24, 2022

INTANGIBLE ASSETS

INTANGIBLE ASSETS

NOTE 14 – INTANGIBLE ASSETS

                The Company has recognized a $2.9 million intangible asset for the license acquired.

Supplemental balance sheet information related to intangible assets is as follows (dollars in thousands):

	September 24, 2022			December 25, 2021
Licenses	$	2,875		$	—
Accumulated amortization		(201	)		—
Intangible assets, net of accumulated depreciation	$	2,674		$	—

                The components of amortization expense were as follows (in thousands):

		Three Months Ended				Nine Months Ended
	Financial Statement Classification	September 24, 2022		September 25, 2021		September 24, 2022		September 25, 2021
License:
Amortization expense	Operating costs		132		—		201		—
Total intangible asset amortization expense			132		—		201		—

                The weighted-average amortization period remaining is 4.92 years.

                The future scheduled amortization of our intangible asset is as follows (in thousands):

	Intangible Asset Amortization
2022 (remaining months)	$	136
2023		543
2024		543
2025		543
2026		543
2027		366
	$	2,674

We may pay contingent consideration over the next five years based on the achievement of certain revenue benchmarks. The purchase price includes the original estimated fair value of the contingent consideration recorded at the present value of approximately $1.4 million. The estimated fair value of the contingent consideration was determined using a probability-weighted discounted cash flow model. We determined the fair value of the contingent consideration obligations by calculating the probability-weighted contingent consideration payments based on our assessment of the likelihood that the benchmarks will be achieved. The probability-weighted contingent consideration payments were then discounted using a discount rate based on the risk free rate of return (10 year treasury rate) plus a risk premium using the probability-weighted cash flows. The fair value measurement is a Level 3 measurement. The fair value of the contingent consideration is reviewed quarterly.

The following tables summarize the Company's assets and liabilities that are measured at fair value on a recurring basis (in thousands):

	Fair Value Measurement at September 24, 2022
	Level 1		Level 2		Level 3
Liabilities
Contingent consideration		—		—		1,380

The following table provides a roll-forward of the fair value of the contingent consideration categorized as Level 3 for the periods ending September 24, 2022 and December 25, 2021 (in thousands):

	Nine Months Ended September 24, 2022		Year Ended December 25, 2021
Opening balance	$	—	$	—
Contingent consideration in connection with acquisition		1,380		—
Ending balance	$	1,380	$	—