INTANGIBLE ASSETS - SOFTWARE PLATFORM, WEBSITE DEVELOPMENT COSTS, TRADEMARKS AND NON-COMPETE AGREEMENTS

3 Months Ended

Jan. 31, 2023

INTANGIBLE ASSETS - SOFTWARE PLATFORM, WEBSITE DEVELOPMENT COSTS, TRADEMARKS AND NON-COMPETE AGREEMENTS

INTANGIBLE ASSETS

NOTE 7 – INTANGIBLE ASSETS – SOFTWARE PLATFORM, WEBSITE DEVELOPMENT COSTS, TRADEMARKS AND NON-COMPETE AGREEMENTS

The website development costs to upgrade and enhance the functionality of Golden Matrix MX’s website branded as Mexplay (https://www.mexplay.mx) were capitalized which amount to $52,788 for the three months ended January 31, 2023. There were no capitalized costs incurred to upgrade RKings’ website for the three months ended January 31, 2023.

Intangible assets related to software and website are amortized on a straight-line basis over their expected useful lives, estimated to be 3 years.

In connection with the 80% acquisition of RKings, the Company recognized the definite-lived intangible assets consisting of $2,000,000 of trademarks and $600,000 of non-compete agreements. The trademark for RKings is amortized over 10 years and the non-compete agreement is amortized over 5 years.

In connection with operating an online casino in Mexico, the Company applied for a gaming permit in Mexico through its subsidiary Golden Matrix MX in the amount of $223,725, which was approved on July 13, 2022. The gaming permit is recognized as an intangible asset and is amortized over 6 years.

Amortization expenses related to intangible assets were $106,666 and $94,169 for the three months ended January 31, 2023 and 2022, respectively. Accumulated amortization was $531,541 and $442,479 as of January 31, 2023 and October 31, 2022, respectively.

The following table details the carrying values of the Company’s intangible assets excluding goodwill:

	As of
	January 31,			October 31,
	2023			2022
Definite-lived intangible assets
Aggregation Platform	$	116,000		$	116,000
Gaming permit in Mexico		235,256			223,725
Website Development Cost		148,804			89,829
Trademarks		2,000,000			2,000,000
Non-compete Agreements		600,000			600,000
Gross definite-lived intangible assets		3,100,060			3,029,554
Less: accumulated amortization
Aggregation Platform		(81,161	)		(73,047	)
Gaming permit in Mexico		(13,094	)		(3,062	)
Website Development Cost		(37,286	)		(26,370	)
Trademarks		(250,000	)		(200,000	)
Non-compete Agreements		(150,000	)		(120,000	)
Total accumulated amortization		(531,541	)		(422,479	)
Net definite-lived intangible assets	$	2,568,519		$	2,607,075