NOTE 6 – INTANGIBLE ASSETS

The Company’s intangible assets consist of patents and patents pending acquired from third parties, and are recorded at cost. The Company amortizes the costs of its intangible assets over their estimated useful lives unless such lives of approximately 11 years. Patents pending are not amortized until the patents are issued. Amortizable intangible assets are tested for impairment based on undiscounted cash flows and, if impaired, written down to fair value based on either discounted cash flows or appraised values. Intangible assets with indefinite lives are tested for impairment, at least annually, and written down to fair value as required.

As of December 31, 2016 and 2015, the Company’s intangible assets, net of accumulated amortization consisted of the following:

Patents and/or software licenses, net	2016			2015
Cost	$	697,955		$	697,955
Amortization		(388,594	)		(341,081	)
Net intangible assets	$	309,361		$	356,874

	2016			2015
Beginning balance for total intangible assets	$	356,874		$	419,387
Impairment loss		—			(15,000	)
Amortization		(47,513	)		(47,513	)
Intangible assets	$	309,361		$	356,874

The Surface Modification Technologies assets include a patent, a patent pending, trade secret technology, instructions, manuals and materials on certain manufacturing processes and know-how. The MRP assets include trade secret technology, instructions, manuals and applicable materials on certain manufacturing processes. For the year ended December 31, 2015, the Company recognized $15,000 in impairment expense related to the MRP assets as the Company is no longer pursing this line of business. For the years ended December 31, 2016 and 2015, the Company recorded amortization expense of $47,513 and $47,513, respectively. See Notes 1 and 9.

Future amortization for the next five years for the Company’s intangible assets consist of the following:

Year	Anticipated Amortization
2017		47,513
2018		47,513
2019		47,513
2020		47,513
2021		47,513
Thereafter		71,796
Total anticipated amortization of intangible assets	$	309,361