INTANGIBLE ASSETS

6 Months Ended

Jun. 30, 2014

NOTE 8: INTANGIBLE ASSETS

As of June 30, 2014, patents, technology and other intangibles with contractual terms were generally amortized over their estimated useful lives of five or ten years. When certain events or changes in operating conditions occur, an impairment assessment is performed and lives of intangible assets with determinable lives may be adjusted.

Prior to any impairment adjustment, intangible assets consisted of the following:

	June 30,			December 31,
	2014			2013

Patents	$	3,601,555		$	3,563,343
Software Development Costs	382,500			—
Licensing	675,000			—
Accumulated Amortization	(760,025		)	(489,398		)
Intangible Assets, Net	$	3,898,530		$	3,073,945

Software development costs and licensing intangible assets both have an estimated useful life of 3 years. Software development costs are incurred during the building of the Company’s Internet platform. Licensing costs are those costs incurred to use processes and technologies not developed by the Company. Both software development and licensing costs are subject to annual impairment testing. During the six months ended June 30, 2014, $382,500 and $38,211 was capitalized as software development cost and patent costs. During the six months ended June 30, 2014, a total of $675,000 of licenses were purchased by exchanging the Company’s own licenses and were accounted for as a non-cash transaction in accordance with ASC 985-845. See Note 1 for more details.

Amortization expense totaled $271,126 and $177,727 for the six months ended June 30, 2014 and 2013, respectively.