NOTE 6 – INTANGIBLE ASSETS

The components of intangible assets, all of which are finite lived, were as follows:

Amortization expenses for the three months ended June 30, 2022 and 2021 were $966,918 and $6,867, respectively. Amortization expenses for the six months ended June 30, 2022 and 2021 were $1,822,244 and $19,617, respectively. 

We recognized losses on intellectual property amounting to $11,095 and $70,895 for the six months ended June 30, 2022 and 2021, respectively.

On March 20, 2022, the Company entered into a Purchase Agreement to acquire the assets of Ardenna, Inc., a leading provider of image processing and machine learning software solutions for rail infrastructure monitoring and inspections. The consideration for the acquisition is $900,000 in cash and 780,000 shares of the Company’s common stock (the “Ardenna Consideration Shares”). In connection with the acquisition, the parties have entered into a Registration Rights and Lock-Up Agreement, which requires the Company to file a resale registration statement covering the resale of the Ardenna Consideration Shares no later than ninety (90) days after the closing date and restricts the holder from transferring the Ardenna Consideration Shares for 180 days from the closing date, subject to certain exceptions. On April 5, 2022, the Company completed the acquisition. As a result of this transaction, the Company recognized developed technology in the amount of $6,843,600.

Estimated amortization expense for the next five years for the intangible assets currently being amortized is as follows: