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Note 9 - Intangible Assets
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Jun. 30, 2013
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| Intangible Assets Disclosure [Text Block] |
NOTE
9 – INTANGIBLE ASSETS
Intangible
assets consisted of the following:
Product
licenses include internally-developed original license
issues, renewals, enhancements, copyrights, trademarks, and
trade names. Product licenses include unamortized software
development and enhancement costs of $22,088,020. Product
licenses are being amortized on a straight-line basis over
their respective lives, which is currently a weighted
average of approximately 8 years. Amortization expense for
the years ended June 30, 2013 and 2012 was $1,905,008 and
$1,536,819, respectively.
On
October 31, 2008, the Company entered into an agreement to
purchase the rights to the customer list of Ciena
Solutions, LLC, a California limited liability company
(“Ciena”). Under the terms of the agreement,
the total consideration for these rights included an
initial payment of $350,000 (plus interest of $2,963), and
deferred consideration to be paid in cash and the
Company’s common stock based on the operational
results of Ciena, and certain other factors, over a
four-year fiscal period. Each fiscal period is measured
from July 1 to June 30 with fiscal period one being the
period from July 1, 2008 to June 30, 2009. No other assets
or liabilities were acquired by the Company as a result of
this transaction.
As
a result of operational losses of Ciena in the first three
fiscal periods, 2009, 2010 and 2011, respectively, the
first three annual deferred consideration installment
payments were determined to be zero.
On
October 4, 2011, the Company entered into an agreement to
acquire a UK based company “Virtual Leasing Services
Limited” through one of its subsidiaries. As a result
of this acquisition, the Company recorded $248,320 of an
existing customer list.
Customer
lists are being amortized based on a straight-line basis,
which approximates the anticipated rate of attrition, which
is currently a weighted average of approximately 5 years.
Amortization expense for the years ended June 30, 2013 and
2012 was $120,804 and $145,808, respectively.
On
October 4, 2011, the Company entered into an agreement to
acquire a UK based company, Virtual Leasing Services
Limited, through one of its subsidiaries. As a result of
this acquisition, the Company recorded $242,702 of existing
technology. Technology assets are being amortized on a
straight-line basis over their respective lives, which is
currently a weighted average of approximately 5 years.
Amortization expense for the years ended June 30, 2013 and
2012 was $49,075 and $36,405, respectively.
Estimated
amortization expense of intangible assets over the next
five years is as follows:
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