6. Goodwill and Intangible Assets

Goodwill represents the excess of the purchase price over the fair value of net assets of acquired businesses and is not amortized. Goodwill and other intangible assets are tested for impairment at a reporting unit level. The annual impairment test of goodwill and intangible assets is performed as of November 30 of each fiscal year.

The Company uses qualitative factors to determine whether it is more likely than not (likelihood of more than 50%) that the fair value of a reporting unit exceeds its carrying amount, including goodwill. Some of the qualitative factors considered in applying this test include consideration of macroeconomic conditions, industry and market conditions, cost factors affecting the business, overall financial performance of the business, and performance of the share price of the Company.

If qualitative factors are not deemed sufficient to conclude that the fair value of the reporting unit more likely than not exceeds its carrying value, then a one-step approach is applied in making an evaluation. The evaluation utilizes multiple valuation methodologies, including a market approach (market price multiples of comparable companies) and an income approach (discounted cash flow analysis). The computations require management to make significant estimates and assumptions, including, among other things, selection of comparable publicly traded companies, the discount rate applied to future earnings reflecting a weighted average cost of capital, and earnings growth assumptions. A discounted cash flow analysis requires management to make various assumptions about future sales, operating margins, capital expenditures, working capital, and growth rates. If the evaluation results in the fair value of the goodwill for the reporting unit being lower than the carrying value, an impairment charge is recorded.

Beginning March 1, 2017, given the general declining trend line of print sales, and its expected continuance into the foreseeable future, the Company elected to treat the recorded value of trademarks/trade names as no longer being an indefinite-lived asset. As such, as of March 1, 2017, the Company began amortizing the carrying value of these assets over their estimated remaining useful life, approximately 17 - 19 years.

The carrying amount and accumulated amortization of the Company’s intangible assets at each balance sheet date are as follows (in thousands):

	Weighted
	Average
	Remaining		Gross
	Life		Carrying		Accumulated
As of May 31, 2018	(in years)		Amount		Amortization		Net
Amortized intangible assets
Trademarks and trade names		15.5	$	20,558	$	2,715	$	17,843
Customer lists		7.9		58,973		27,136		31,837
Noncompete		4.1		275		151		124
Patent		0.2		783		782		1
Total		10.6	$	80,589	$	30,784	$	49,805

As of February 28, 2018
Amortized intangible assets
Trademarks and trade names		16.0	$	19,625	$	2,408	$	17,217
Customer lists		8.1		58,040		26,039		32,001
Noncompete		1.1		175		140		35
Patent		0.4		783		782		1
Total		10.8	$	78,623	$	29,369	$	49,254

Aggregate amortization expense for the three months ended May 31, 2018 and May 31, 2017 was $1.4 million and $1.5 million, respectively.

The Company’s estimated amortization expense for the current and next four fiscal years ending in February of the stated fiscal year is as follows (in thousands):

2019	$	5,730
2020		5,682
2021		5,612
2022		5,569
2023		4,781

Changes in the net carrying amount of goodwill as of the dates indicated are as follows (in thousands):

Balance as of March 1, 2017	$	70,603
Goodwill acquired		—
Goodwill impairment		—
Balance as of February 28, 2018		70,603
Goodwill acquired		—
Goodwill impairment		—
Balance as of May 31, 2018	$	70,603