Goodwill and Other Intangible Assets

9 Months Ended

Sep. 30, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

5.	Goodwill and Other Intangible Assets:

Goodwill represents the excess purchase cost over the fair value of net assets of companies acquired in business combinations. Goodwill is an indefinite lived asset and is assessed for impairment at least annually or more frequently if a triggering event occurs. If the carrying amount of a reporting unit is greater than the fair value, impairment may be present. ASC 350 permits an entity to assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount before applying the two-step goodwill impairment model. If it is determined through the qualitative assessment that a reporting unit’s fair value is more likely than not greater than its carrying value, the remaining impairment steps would be unnecessary. The qualitative assessment is optional, allowing companies to go directly to the quantitative assessment. No impairment charges were recorded by the Company in 2014 or 2013.

Goodwill amounts by reporting unit are summarized as follows:


	Goodwill at December 31, 2013		Acquisitions (1)		Dispositions		Other (2)			Goodwill at September 30, 2014
United States, excluding All Points	$	446,382	$	325,141	$	—	$	—		$	771,523
All Points		58		—		—		—			58
Canada		12,785		514		—		(619	)		12,680
Mexico		7,002		—		—		(170	)		6,832
Australia		—		—		—		—			—

Total	$	466,227	$	325,655	$	—	$	(789	)	$	791,093

(1)	Changes in values primarily related to the Merger Transaction.

(2)	These amounts relate to adjustments resulting from fluctuations in foreign currency exchange rates.

The Company also evaluates indefinite-lived intangible assets (primarily trademarks and trade names) for impairment annually or more frequently if events and circumstances indicate that it is more likely than not that the fair value of an indefinite-lived intangible asset is below its carrying amount. ASC 350 permits an entity to assess qualitative factors to determine whether it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying amount before applying the two-step impairment model. In connection with the evaluation of indefinite-lived intangible assets, an independent appraiser assessed the value of the Company’s intangible assets based on a relief from royalties, excess earnings, and lost profits discounted cash flow model. An impairment charge is recorded if the carrying amount of an indefinite-lived intangible asset exceeds the estimated fair value on the measurement date. No impairment charges were recorded by the Company in 2014 or 2013.

Definite-lived intangible assets are amortized over their useful lives and are subject to impairment testing. The values assigned to intangible assets were determined by a preliminary appraisal. The intangible asset values may be adjusted by management for changes determined upon completion of work on the independent appraisal. Other intangibles, net, as of September 30, 2014 and December 31, 2013 consist of the following:


	Estimated Useful Life (Years)	September 30, 2014		Estimated Useful Life (Years)	December 31, 2013
Customer relationships	20	$	449,219	20	$	341,500
Trademarks - All Others	Indefinite		79,727	Indefinite		54,082
Trademarks - TagWorks	5		—	5		240
Patents	5-20		25,000	5-20		20,250
Quick Tag license	2		7,000	6		11,500
Laser Key license	1.5		1,500	5		1,250
KeyWorks license	6.5		4,000	10		4,100
Non-compete agreements	6.5		5,000	5-10		4,450

Intangible assets, gross			571,446			437,372
Less: Accumulated amortization			7,860			75,007

Other intangibles, net		$	563,586		$	362,365

The Successor’s amortization expense, excluding the adjustments resulting from fluctuations in foreign currency exchange rates, for amortizable assets was $7,860 for the three months ended September 30, 2014. The Predecessor’s amortization expense for amortizable assets was $5,554 for the three months ended September 30, 2013. The Successor’s amortization expense for amortizable assets was $7,866, including the adjustments resulting from fluctuations in foreign currency exchange rates, for the three months ended September 30, 2014 and the Predecessor’s expense was $11,093 for the six months ended June 29, 2014. The Predecessor’s amortization expense for amortizable assets was $16,559 for the nine months ended September 30, 2013. The combination of the amortization expense for amortizable assets of the Successor and Predecessor for the year ended December 31, 2014 is estimated to be $26,556. For the years ended December 31, 2015, 2016, 2017, 2018, and 2019, the Successor’s amortization expense for amortizable assets is estimated to be $30,927, $28,174, $26,424, $26,424, and $25,804, respectively.

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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