Goodwill and Intangible Assets

12 Months Ended

May 31, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND INTANGIBLE ASSETS

GOODWILL AND INTANGIBLE ASSETS

Goodwill

Goodwill is not amortized, but rather, is tested for impairment annually or more frequently if impairment indicators arise. Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in each business combination.

The Company's annual testing for impairment of goodwill was completed as of December 31, 2020. The Company operates as a single operating segment with one reporting unit and consequently evaluates goodwill for impairment based on an evaluation of the fair value of the Company as a whole. The Company determines the fair value of the reporting unit based on the market valuation approach and concluded that it was not more-likely-than-not that the fair value of the Company's reporting unit was less than its carrying value.

Even though the Company determined that there was no goodwill impairment as of December 31, 2020, the future occurrence of a potential indicator of impairment, such as a significant adverse change in legal, regulatory, business or economic conditions or a more-likely-than-not expectation that the reporting unit or a significant portion of the reporting unit will be sold or disposed of, would require an interim assessment for the reporting unit prior to the next required annual assessment as of December 31, 2021.

There were no adjustments to goodwill for the year ended May 31, 2021 other than foreign currency translation adjustments. For the year ended May 31, 2020 the Company recorded a goodwill impairment charge of $158.6 million to write down the carrying value of the reporting unit to fair value.

Definite Lived Intangible Assets

Definite lived intangible assets consist primarily of product technologies and customer relationships and are amortized over their estimated useful lives, which range between two to eighteen years, on either a straight-line basis over the expected period of benefit or as revenues are earned from the sales of the related product. Amortization expense was $18.1 million, $18.1 million and $17.1 million for fiscal years 2021, 2020 and 2019, respectively. During the fourth quarter of fiscal year 2021, the Company made the decision to abandon the OARtrac product technology and trademark. This resulted in an impairment charge of $14.0 million. The impairment charge is recorded in "Acquisition, restructuring and other items, net", on the Consolidated Statement of Operations (see Note 19). There were no impairment charges on definite lived intangible assets for the years ended May 31, 2020 and 2019.

Intangible assets consisted of the following:

	May 31, 2021
(in thousands)	Gross carrying value		Accumulated amortization		Net carrying value
Product technologies	$	236,907	$	(97,343)	$	139,564
Customer relationships	60,291		(34,164)		26,127
Trademarks	9,950		(6,905)		3,045
Licenses	6,087		(5,846)		241
	$	313,235	$	(144,258)	$	168,977

	May 31, 2020
(in thousands)	Gross carrying value		Accumulated amortization		Net carrying value
Product technologies	$	251,569	$	(88,547)	$	163,022
Customer relationships	60,160		(30,018)		30,142
Trademarks	10,150		(6,691)		3,459
Licenses	6,087		(5,574)		513
	$	327,966	$	(130,830)	$	197,136

Expected future amortization expense related to the intangible assets for each of the following fiscal years is as follows:

(in thousands)
2022	$	15,156
2023	15,595
2024	14,111
2025	15,131
2024	16,138
2025 and thereafter	92,846
	$	168,977