Discontinued Operations

12 Months Ended

Dec. 31, 2019

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

Note 4. Discontinued Operations

In November 2018, the management of the Company's then 51% controlled subsidiary, Banana Whale, entered into discussions whereby the Company would sell its shares of BWS to a third party. Under the agreement, which had an effective date of January 1, 2019, the Company received cash of $1,500,000 and a promissory note of $500,000 and the return of the 295,320 Company shares issued on acquisition.

The Company realized a gain of $553,000 on the sale of its 51% interest in BWS during the year ended December 31, 2019.

In December 2019, an agreement regarding the remaining amount due on the Promissory note of $500,000 was reached whereby the Company received $250,000 in December 2019 and the balance payable over the 2 years ending December 2021 whereby the Company will receive an amount equal to 25% of reported EBITDA each quarter up to a maximum amount of $250,000 in aggregate.

During the year ended December 31, 2019, the Company decided to sell its interests in its subsidiaries, Love Media House and Browning . In connection with this determination, the Company concluded the intangible assets related to these subsidiaries were impaired. Accordingly, the Company recorded an impairment charge of $2,440,000 which is included in the loss from discontinued operations.

On February 24, 2020, the Company completed the sale of its interest in Browning to William J. Browning, the holder of the remaining Browning shares. Under the agreement, Browning and Mr. Browning agreed to repay advances totaling $210,000 made to Browning by the Company over a 24-month period ending January 31, 2022 with an early repayment discount given during the six months ending August 31, 2020. Mr. Browning also agreed to return to the Company shares given to Mr. Browning under the original acquisition for cancellation by the Company.

The Company has accounted for the operations of BWS, Love Media House and Browning as discontinued operations. The Statements of Operations for year ended December 31, 2019 and 2018 for discontinued operations is as follows: (in thousands)

	Years Ended December 31,
	2019			2018
Revenue	$	467		$	637
Cost of revenue
Hardware		193			596
Amortization		150			166
		343			762
Gross Profit/(deficit)		124			(125	)
Expenses
General and administrative		987			1,054
Depreciation		8			10
Other expenses		19			(23	)
Impairment		2,440			-
		3,454			1,041
Loss from Discontinued Operations	$	(3,330	)	$	(1,166	)

The balance sheet of discontinued operations as of December 31, 2019 and 2018 is as follows: (in thousands)

	December 31,
	2019		2018
Current Assets
Cash	$	2	$	58
Accounts Receivable		-		436
Other current assets		27		92
		29		586
Property and equipment		34		39
Intangible assets		-		830
Goodwill		-		1,659
	$	63	$	3,114
Current Liabilities
Accounts payable and accrued expenses	$	36	$	59
Deferred revenue		15		177
Loans payable		115		401
Finance contracts, due within one year		51		-
Notes payable – related parties		211		205
	$	428	$	842