Quarterly report pursuant to Section 13 or 15(d)

Patent Application Costs

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Patent Application Costs
9 Months Ended
Sep. 30, 2018
Goodwill and Intangible Assets Disclosure [Abstract]  
Patent Application Costs

8. Patent Application Costs

 

The operating agreement which governs the terms of Spirulinex, includes among other things, the requirement that: the Company contribute to Spirulinex an aggregate of 200,000 restricted shares of common stock valued at $4.75 per share, par value $0.001 per share; the Company contribute to Spirulinex a total of $350,000 to fund the business operations of Spirulinex; and Solunas Aqua Corp. enter into an IP assignment agreement and IP purchase agreement with Spirulinex for all intellectual property and provisional patents relating to the business.

 

The Company has applied for patents which it believes are a new, original and ornamental design for Oral Consumable Flakes. The patents use the methods of preparing solulizable, encapsulated plant-based compositions.

 

During the nine months ended September 30, 2018, the Company has paid $632,368 in legal and associated costs for the multiple patent applications.

 

As the patents have not been issued as of September 30, 2018, no amortization has been applied against the patent costs. If the patents are approved, the Company will amortize the patent application costs over their useful lives. If the patents are not approved, the patent application costs will be expensed and charged against income.