Quarterly report pursuant to Section 13 or 15(d)

Intangible Assets and Liabilities Other Than Goodwill

Intangible Assets and Liabilities Other Than Goodwill

3 Months Ended

Mar. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets and Liabilities Other Than Goodwill

As of March 31, 2023 and December 31, 2022 we had the following amounts related to intangible assets and liabilities other than goodwill:


	March 31, 2023						December 31, 2022
Intangible assets	Cost		Accumulated Amortization		Total		Cost		Accumulated Amortization		Total
Product certifications	$	777,465	$	(597,499)	$	179,966	$	777,465	$	(584,863)	$	192,602
Patents	888,910		(427,515)		461,395		888,910		(405,140)		483,770
Developed technology	240,000		(160,000)		80,000		240,000		(156,000)		84,000
Trademarks	26,896		—		26,896		26,896		—		26,896
In Process R&D	263,936		(75,410)		188,526		263,936		(65,984)		197,952
Favorable contract asset	384,465		(373,363)		11,102		384,465		(372,091)		12,374

	$	2,581,672	$	(1,633,787)	$	947,885	$	2,581,672	$	(1,584,078)	$	997,594

Intangible liability
Unfavorable contract liability	$	2,618,168	$	(1,859,232)	$	758,936	$	2,618,168	$	(1,797,951)	$	820,217

The aggregate amortization expense related to intangible assets and liabilities exclusive of contract related intangibles for the three months ended March 31, 2023 and 2022 was $49,361 and $50,795. The net credit to cost of sales related to the amortization of the contract related intangible asset and liability for the three months ended March 31, 2023 and 2022 was $60,933 and $70,526, respectively

Favorable/Unfavorable Contract Assets and Liabilities

The favorable contract asset and unfavorable contract liability in the foregoing table represent the estimated fair value of American DG Energy's customer contracts (both positive for favorable contracts and negative for unfavorable contracts) which were acquired by us in May 2017.

Amortization of intangibles including contract related amounts is calculated using the straight-line method over the remaining useful life or contract term. Aggregate future amortization over the next five years and thereafter as of March 31, 2023 is estimated to be as follows:


	Non-contract Related Intangibles		Contract Related Intangibles		Total
Year 1	$	198,951	$	(223,230)	$	(24,279)
Year 2	181,065		(146,940)		34,125
Year 3	177,295		(97,376)		79,919
Year 4	172,495		(62,692)		109,803
Year 5	136,158		(55,026)		81,132
Thereafter	55,025		(173,672)		(118,647)
Total	$	920,989	(758,936)		$	162,053