INTANGIBLE ASSETS AND GOODWILL

12 Months Ended

Dec. 31, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

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 12 years as of December 31, 2017. 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 consisted of the following at December 31, 2016 and 2017:



	2016			2017
Patents	$	1,132,000		$	1,349,000
Domain Name	22,000			22,000
Client Base (1)	137,000			143,000
Trademark (1)	17,000			17,000
Backlog (1)	12,000			13,000
Technology	84,000			77,000
	1,404,000			1,621,000
Less: accumulated amortization	(151,000		)	(268,000		)
Net intangible assets	$	1,253,000		$	1,353,000

(1) Includes the impact of foreign currency translation. The total impact at December 31, 2016 was $5,000 and the total impact at December 31, 2017 was $2,000.

During the year ended December 31, 2016 and 2017, we wrote-off $19,000 and $8,000, respectively, of patents we are no longer pursuing. The write-offs are included in research and development expense.

Amortization of intangible assets was $89,000 and $126,000 for the years ended December 31, 2016 and 2017, respectively. The following table summarizes the estimated amortization expense relating to the intangible assets as of December 31, 2017:



Years ending December 31,
2018	$	130,000
2019	103,000
2020	76,000
2021	66,000
2022	56,000
2023 and thereafter	418,000
Total amortization expense	$	849,000

Goodwill represents the excess of the purchase price over the fair value of the net assets acquired from GVR Trade (see Note 5). 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.



	Goodwill
Balance at January 1, 2016	$	—
Acquisition of GVR	824,000
Effect of currency translation	(35,000		)
Balance at December 31, 2016	$	789,000
Effect of currency translation	$	35,000
Balance at December 31, 2017	$	824,000

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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