NOTE

INTANGIBLE ASSETS

Intangible assets consisted of the following as of:

	March 31,			June 30,
	2020			2019
Customer relationships	$	700,252		$	700,252
Brand name		1,142,122			1,142,122
Domain name		36,913			36,913
Recipes		1,221,601			1,221,601
Non-compete agreement		274,982			274,982
Internally developed software		217,990			-
Total		3,593,860			3,375,870
Less : accumulated amortization		(968,928	)		(716,147	)
Net intangibles	$	2,624,932		$	2,659,723

CUSTOMER RELATIONSHIPS

August 11, 2015,

the Company acquired Gourmet Foods. The fair value on the acquired customer relationships was estimated to be

$66,153

and is amortized over the remaining useful life of

years. On

June 2, 2016,

the Company acquired Brigadier Security Systems. The fair value on the acquired customer relationships was estimated to be

$434,099

and is amortized over the remaining useful life of

years. On

December 18, 2017

the Company’s wholly-owned subsidiary, Kahnalytics, Inc., acquired the assets of Original Sprout LLC. The fair value of the acquired customer relationships was determined to be

$200,000

and is amortized over the remaining useful life of

years.

	March 31,			June 30,
	2020			2019
Customer relationships	$	700,252			700,252
Less: accumulated amortization		(262,709	)		(203,492	)
Total customer relationships, net	$	437,543			496,760

BRAND NAME

August 11, 2015,

the Company acquired Gourmet Foods. The fair value on the acquired brand name was estimated to be

$61,429

and is amortized over the remaining useful life of

years. On

June 2, 2016,

the Company acquired Brigadier Security Systems. The fair value on the acquired brand name was estimated to be

$340,694

and is amortized over the remaining useful life of

years. On

December 18, 2017

the Company’s wholly-owned subsidiary, Kahnalytics, Inc., acquired the assets of Original Sprout LLC. The fair value of the acquired brand name was determined to be

$740,000

and is considered to have an indefinite life. Unlike the brand names Gourmet Foods and Brigadier Security Systems, Original Sprout is an actual product name and recognized associated brand that is identifiable to consumers of the product and is the basis of the value proposition. That brand name will forever be associated with the product offering unless and until such time in the future as the Company

may

elect to discontinue the use of the brand and move towards establishment of an alternative product offering. Therefore, the Company will test for impairment of the brand name "Original Sprout" at each reporting interval with

amortization recognized.

	March 31,			June 30,
	2020			2019
Brand name	$	1,142,122		$	1,142,122
Less: accumulated amortization		(159,381	)		(129,084	)
Total brand name, net	$	982,741		$	1,013,038

DOMAIN NAME

August 11, 2015,

the Company acquired Gourmet Foods, Ltd. The fair value on the acquired domain name was estimated to be

$21,601

and is amortized over the remaining useful life of

years. On

June 2, 2016,

the Company acquired Brigadier Security Systems. The fair value on the acquired domain name was estimated to be

$15,312

and is amortized over the remaining useful life of

years.

	March 31,			June 30,
	2020			2019
Domain name	$	36,913		$	36,913
Less: accumulated amortization		(31,903	)		(26,341	)
Total brand name, net	$	5,010		$	10,572

RECIPES AND FORMULAS

August 11, 2015,

the Company acquired Gourmet Foods. The fair value on the recipes was estimated to be

$21,601

and is amortized over the remaining useful life of

years. On

December 18, 2017

the Company’s wholly-owned subsidiary, Kahnalytics, Inc., acquired the assets of Original Sprout LLC. The fair value of the acquired recipes and formulas was determined to be

$1,200,000

and is amortized over the remaining useful life of

years.

	March 31,			June 30,
	2020			2019
Recipes and formulas	$	1,221,601		$	1,221,601
Less: accumulated amortization		(362,892	)		(246,622	)
Total recipes and formulas, net	$	858,709		$	974,979

NON-COMPETE AGREEMENT

June 2, 2016,

the Company acquired Brigadier Security Systems. The fair value on the acquired non-compete agreement was estimated to be

$84,982

and is amortized over the remaining useful life of

years. On

December 18, 2017

the Company’s wholly-owned subsidiary, Kahnalytics, Inc., acquired the assets of Original Sprout LLC. The fair value of the acquired non-compete agreement was determined to be

$190,000

and is amortized over the remaining useful life of

years.

	March 31,			June 30,
	2020			2019
Non-compete agreement	$	274,982		$	274,982
Less: accumulated amortization		(152,043	)		(110,608	)
Total non-compete agreement, net	$	122,939		$	164,374

INTERNALLY DEVELOPED SOFTWARE

During the current quarter ended

March 31, 2020,

Marygold began incurring expenses in connection with the internal development of software applications that are planned for eventual integration to its consumer Fintech offering. Certain of these expenses, totaling

$217,990

as of

March 31, 2020,

have been capitalized as intangible assets. Once development has been completed and the product is commercially viable, these capitalized costs will be amortized over their useful lives. As of

March 31, 2020,

amortization expense has been recorded for these intangible assets.

AMORTIZATION EXPENSE

The total amortization expense for intangible assets for the

three

and

nine

months ended

March 31, 2020

was

$83,974

and

$252,781,

respectively, as compared to

$82,728

and

$251,861

for the

three

and

nine

months ended

March 31, 2019,

respectively.

Estimated amortization expenses of intangible assets for the next

five

fiscal years, are as follows:

Years Ending June 30,	Expense
2020	$	83,647
2021		325,862
2022		306,809
2023		286,507
2024		268,809
Thereafter		1,353,298
Total	$	2,624,932