Craig A. Smith - Laserfiche WebLink

Home Browse Search

Craig A. Smith & Associate, Inc. and MPS31), LLC Notes to Financial Statements NOTE 4 — OTHER ASSETS Technology License Craig A. Smith & Associates, Inc. and MPS3D, LLC entered into a technology license agreement for the use of Witten Technologies proprietary 3D radar tomography. The technology is used to locate underground utilities to assist in engineering projects. As of December 31, 2015 and 2014 the Witten Technologies License is recorded as $60,000 with accumulated amortization of $60,000 for both years. In 2014, the Companies recorded $6,000 in amortization expense related to the technology license. The license automatically renews annually with no fee unless there is a material breach of the agreement. The Witten Technology Company went bankrupt in 2009 and the company's remaining assets were purchased by Underground Imaging Technologies, LLC, a subsidiary of the Caterpillar Corporation. Royalties due per an existing Software Licensing Agreement have been accrued in the amounts of $146,268 and $128,584 in the event that the holder of the license should request the royalties due per the agreement. The royalties are calculated at 10% of Gross Revenues from Radar Tomography for services sold under the Trademarks and 15% of Gross Revenues from the provision of previously -acquired data to subsequent customers of Licensee. Royalty expense for years ended December 31, 2015 and 2014 was $17,684 and $58,336, respectively. These royalties have not been requested for over 6 years. NOTE 5 — DEBT Note Payable — Bank The Companies entered into a $610,700 Promissory Note Payable ("Note") with JP Morgan Chase Bank in 2011. The note has a 60 month term which commenced March 2011 with monthly principal and interest payments of $11,905. Interest on the Note is calculated at 6.14% per annum based on a year of 360 days. The final payment is due April 2016. During the years ended December 31, 2015 and 2014 the Companies incurred $7,511 and $15,660 of interest expense respectively related to the Note. The balance on the note payable was $46,730 and $182,084 as of December 31, 2015 and 2014, respectively. In 2012 the Companies entered into a $64,000 Promissory Note Payable ("Note") with JP Morgan Chase Bank related to the purchase of a building. The Note has a 10 year term which commenced April 1, 2012 with monthly principal and interest payments of $435. Interest on the Note is calculated at 5.25% per annum based on a year of 360 days. The final payment is due March 1, 2022. During the years ended December 31, 2015 and 2014 the Companies incurred $3,104 and $3,295 of interest expense respectively related to the Note. The balance on the note payable was $56,405 and $58,639 as of December 31, 2015 and 2014, respectively. The Companies' assets are pledged as collateral related to the notes with JP Morgan Chase Bank. The following is a summary of principal maturities of the Notes Payable during the next five years and thereafter: Year ended December 31, 2016 $ 49,075 2017 2,478 2018 2,610 2019 2,749 2020 and thereafter 46,223 $ 103,135 -10-