Annual report pursuant to Section 13 and 15(d)

INTANGIBLE ASSETS, NET, AND GOODWILL

v3.20.1
INTANGIBLE ASSETS, NET, AND GOODWILL
12 Months Ended
Dec. 31, 2019
Goodwill and Intangible Assets Disclosure [Abstract]  
INTANGIBLE ASSETS, NET, AND GOODWILL
INTANGIBLE ASSETS, NET, AND GOODWILL
Intangible assets include patents, domain name and other intangibles purchased from GVR, including customer relationships, technology and a trademark. Certain patents were acquired from STI as a result of an asset contribution and were recorded at their carryover basis. The fair value of the patents remained substantially the same as their carrying value at the exchange date. In addition, we acquired other patents and the domain name www.resonant.com through the normal course of business. Intangibles acquired as part of the purchase of GVR were initially recorded at their fair value. Issued patents are amortized over their approximate useful life of 17 years, or 20 years in the case of new patents, once they are approved by their respective regulatory agency. For the patents acquired from STI, we are amortizing them over the remaining useful life of 1 to 11 years as of December 31, 2019. The domain name is amortized over the approximate useful life of 10 years. The other intangibles acquired from GVR are amortized over their useful life of three to five years.
Intangible assets, net, consists of the following as of December 31, 2019 and 2018:
 
2019
 
2018
Cost:
 
 
 
Patents
$
1,801,000

 
$
1,507,000

Domain name
22,000

 
22,000

Client Base (1)
144,000

 
142,000

Trademark (1)
18,000

 
17,000

Backlog (1)
13,000

 
13,000

Technology
77,000

 
77,000

 
2,075,000

 
1,778,000

Less: Accumulated amortization
(499,000
)
 
(404,000
)
Intangible assets, net
$
1,576,000

 
$
1,374,000

(1)
Includes the impact of foreign currency translation. The total impact at December 31, 2018 was $1,000 and there was no impact at December 31, 2019.    
During the year ended December 31, 2019 and 2018, we wrote-off $145,000 and $96,000, respectively, of patents we are no longer pursuing. The write-offs are included in research and development expense. There were no impairments to any other intangibles.
Amortization of intangible assets was $115,000 and $136,000 for the years ended December 31, 2019 and 2018, respectively. The following table summarizes the estimated amortization expense relating to the intangible assets as of December 31, 2019:
Years ending December 31,
 
2020
$
94,000

2021
85,000

2022
75,000

2023
72,000

2024
71,000

2025 and thereafter
554,000

Total amortization expense
$
951,000

Goodwill represents the excess of the purchase price over the fair value of the net assets acquired from GVR Trade. Goodwill is not amortized, but is subject to impairment tests on at least an annual basis and whenever circumstances suggest that goodwill may be impaired.

The following table summarizes goodwill arising from the acquisition of GVR Trade:
 
Goodwill
Balance at January 1, 2018
$
824,000

Effect of currency translation
(7,000
)
Balance at December 31, 2018
$
817,000

Effect of currency translation
14,000

Balance at December 31, 2019
$
831,000