DermaWand Purchase Agreement	6 Months Ended
Jun. 30, 2018
Dermawand Purchase Agreement
DermaWand Purchase Agreement	Note 6 – DermaWand® Purchase Agreement On January 22, 2016, we entered into a Purchase Agreement with Omega 5 Technologies, Inc. to acquire the worldwide ownership of the DermaWand® patent and all related trademarks and intellectual property for the sum of $1,200,000 to be paid out as follows: $300,000 per year for calendar years 2016 through 2019, payable in uniform quarterly installments on or before the last day of each calendar quarter. As a result, effective January 1, 2016, we are no longer obligated to make royalty payments on sales of DermaWand®. There shall be no interest charged, and we may, in our sole discretion, at any time without permission or penalty pre-pay some or all of the purchase price. Under our old licensing agreement, we had been assigned the patents, related trademarks, and exclusive commercial rights to DermaWand® based upon a $2.50 per unit fee and maintaining annual minimum royalty requirements. As a result of the agreement, we recorded an offsetting asset and liability at January 1, 2016 in the amount of $1,200,000 for the asset from the intellectual property acquired and a corresponding liability per the payment schedule. As there is no interest charged with the purchase agreement we recorded a discount for imputed interest of approximately $37,000, calculated based on the applicable federal rates at January 22, 2016 of 1.45%, which will be amortized over the term of the agreement using the effective interest method. The intangible asset balance for the patent and trademark will be amortized using the straight-line method over the four period of the agreement, which at this time is management’s best estimate of the remaining useful life. As of June 30, 2018, the other liability balance was approximately $595,000 net of the discount for imputed interest of approximately $5,000. For the three and six months ended June 30, 2018 and 2017, we amortized approximately $2,000 and $4,000 and $3,000 and $6,000, respectively, of interest expense related to the discount for imputed interest. Management evaluates the intangible asset for impairment when there is triggering event and concluded there was no such event at June 30, 2018.

DermaWand Purchase Agreement

6 Months Ended

Jun. 30, 2018

Note 6 – DermaWand® Purchase Agreement

On January 22, 2016, we entered into a Purchase Agreement with Omega 5 Technologies, Inc. to acquire the worldwide ownership of the DermaWand® patent and all related trademarks and intellectual property for the sum of $1,200,000 to be paid out as follows: $300,000 per year for calendar years 2016 through 2019, payable in uniform quarterly installments on or before the last day of each calendar quarter. As a result, effective January 1, 2016, we are no longer obligated to make royalty payments on sales of DermaWand®. There shall be no interest charged, and we may, in our sole discretion, at any time without permission or penalty pre-pay some or all of the purchase price. Under our old licensing agreement, we had been assigned the patents, related trademarks, and exclusive commercial rights to DermaWand® based upon a $2.50 per unit fee and maintaining annual minimum royalty requirements.

As a result of the agreement, we recorded an offsetting asset and liability at January 1, 2016 in the amount of $1,200,000 for the asset from the intellectual property acquired and a corresponding liability per the payment schedule. As there is no interest charged with the purchase agreement we recorded a discount for imputed interest of approximately $37,000, calculated based on the applicable federal rates at January 22, 2016 of 1.45%, which will be amortized over the term of the agreement using the effective interest method. The intangible asset balance for the patent and trademark will be amortized using the straight-line method over the four period of the agreement, which at this time is management’s best estimate of the remaining useful life.

As of June 30, 2018, the other liability balance was approximately $595,000 net of the discount for imputed interest of approximately $5,000. For the three and six months ended June 30, 2018 and 2017, we amortized approximately $2,000 and $4,000 and $3,000 and $6,000, respectively, of interest expense related to the discount for imputed interest.

Management evaluates the intangible asset for impairment when there is triggering event and concluded there was no such event at June 30, 2018.