ACQUISTION OF YOU EVERYWHERE NOW, LLC

3 Months Ended

Jun. 30, 2017

Notes to Financial Statements

Note 4. ACQUISTION OF YOU EVERYWHERE NOW, LLC

On October 3, 2014, the Company’s wholly-owned subsidiary, The Pulse Network, Inc., a Massachusetts corporation (Pulse Massachusetts) acquired a 100% membership interest in You Everywhere Now, LLC, a California limited liability company (“You Everywhere Now”) from MikeKoenigs.com Inc. (seller). You Everywhere Now, in turn, holds 100% of the membership interests of VoiceFollowUp, LLC, a California limited liability company, and Traffic Geyser, LLC, a California limited liability company. Closing of the transaction under the Securities Purchase Agreement was conditioned upon closing and funding under the senior secured revolving credit facility agreement with TCA Global Credit Master Fund, LP as described in note 9.

The Company paid consideration to the seller comprised of a promissory note payable to the seller in the amount of $1,170,000 and cash of $1,047,560 financed through debt proceeds. The Company assumed liabilities of the seller totaling $244,450. The Company allocated the purchase price to intangible assets with a fair value of $1,738,750 and accounts receivable of $29,127. The excess of the consideration paid over the fair value of the assets acquires totaling $694,133 was recorded as goodwill on the Company’s balance sheet at December 31, 2014. The Company estimated the useful lives of the various identifiable intangible assets acquired to be between two and fifteen years.

During the quarter ended December 31, 2015 the Company determined that circumstances indicated that the fair value of goodwill and intangible assets acquired in the You Everywhere Now acquisition was impaired. The Company determined based on its analysis of fair value of these assets at December 31, 2015 that goodwill should be written off in its entirety and the customer lists should be written down to their estimated fair value of $762,467 and amortized over their estimated remaining useful life of two years. The total amount of the impairment loss recognized of $1,231,396 consists of goodwill in the amount of $694,133, and intangible assets in the amount of $537,26.

During the quarter end June 30, 2016, the Company wrote off the remaining balance of intangible assets due to the continuous decline in sales related to the assets acquired in the You Everywhere Now acquisition.

Intangible assets at June 30, 2017 and March 31, 2017 consist of the following:

	June 30, 2017		March 31, 2017
Total customer list-active & non-active	$	-	$	762,467
Non-compete agreement		-		191,900
Trademarks		-		185,340
Software/database		-		61,779
		-		1,201,486
Accumulated amortization		-		(1,201,486	)
Intangible assets, net	$	-	$	-

The Company incurred direct cost related to the acquisition of You Everywhere Now totaling $212,967 which is reported in the Company’s statement of operations for the year ended ended March 31, 2015 as acquisition related expenses.