NOTE

- GOODWILL AND OTHER INTANGIBLE ASSETS

The carrying values of goodwill and other intangible assets with indefinite lives are reviewed at least annually for possible impairment. The Company

may

first

assess qualitative factors in order to determine if goodwill and indefinite-lived intangible assets are impaired. If through the qualitative assessment it is determined that it is more likely than

not

that goodwill and indefinite-lived assets are

not

impaired,

further testing is required. If it is determined more likely than

not

that goodwill and indefinite-lived assets are impaired, or if the Company elects

not

first

assess qualitative factors, the Company’s impairment testing continues with the estimation of the fair value of the reporting unit using a combination of a market approach and an income (discounted cash flow) approach, at the reporting unit level. The estimation of the fair value of reporting unit requires significant management judgment with respect to revenue and expense growth rates, changes in working capital and the selection and use of an appropriate discount rate. The estimates of the fair value of reporting units are based on the best information available as of the date of the assessment. The fair value measurements of the reporting units are based on significant inputs

not

observable in the market and thus represent Level

measurements as defined by ASC

820

“Fair Value Measurements.” The use of different assumptions would increase or decrease estimated discounted future operating cash flows and could increase or decrease an impairment charge. Company management uses its judgment in assessing whether assets

may

have become impaired between annual impairment tests. Indicators such as adverse business conditions, economic factors and technological change or competitive activities

may

signal that an asset has become impaired.

The Company identified its reporting units in conjunction with its annual goodwill impairment testing. The Company has a total of

two

reporting units that contain goodwill. There is

one

reporting unit within the Lighting Segment and

one

reporting unit within the Graphics Segment. The Company relies upon a number of factors, judgments and estimates when conducting its impairment testing including, but

not

limited to, the Company’s stock price, operating results, forecasts, anticipated future cash flows and marketplace data. There are inherent uncertainties related to these factors and judgments in applying them to the analysis of goodwill impairment.

As of

March 1, 2020,

the Company performed its annual goodwill impairment test on the

two

reporting units that contain goodwill. The preliminary goodwill impairment test of the reporting unit in the Lighting Segment passed with a business enterprise value of

$31.6

million or

33%

above the carrying value of this reporting unit including goodwill. The preliminary goodwill impairment test of the reporting unit with goodwill in the Graphics Segment passed with an estimated business enterprise value of

$4.7

million or

619%

above the carrying value of the reporting unit including goodwill. The definitive impairment test is expected to be completed in the

fourth

quarter of fiscal

2020.

It is anticipated that the results of the test will

not

change when the test is complete.

A significant decline in the Company’s stock price during

March 2020

related to the COVID-

pandemic led management to conclude that a triggering event occurred. As a result, an interim goodwill impairment test subsequent to the

March 1

testing date was required for both reporting units as of

March 31, 2020

The result of the impairment test on both reporting units indicated that goodwill was

not

impaired

The following table presents information about the Company's goodwill on the dates or for the periods indicated:

Goodwill
(In thousands)	Lighting			Graphics
	Segment			Segment			Total
Balance as of June 30, 2019
Goodwill	$	94,564		$	28,690		$	123,254
Accumulated impairment losses		(85,356	)		(27,525	)		(112,881	)
Goodwill, net as of June 30, 2019	$	9,208		$	1,165		$	10,373

Balance as of March 31, 2020
Goodwill	$	94,564		$	28,690		$	123,254
Accumulated impairment losses		(85,356	)		(27,525	)		(112,881	)
Goodwill, net as of March 31, 2020	$	9,208		$	1,165		$	10,373

The Company performed its annual review of indefinite-lived intangible assets as of

March 1, 2020

and determined there was

impairment. The preliminary indefinite-lived intangible impairment test passed with a fair market value of

$16.8

million or

392%

above its carrying value. The definitive indefinite-lived impairment test is expected to be completed in the

fourth

quarter of fiscal

2020.

It is anticipated that the results of the test will

not

change when the test is complete.

The following table presents the gross carrying amount and accumulated amortization by each major asset class:

Other Intangible Assets	March 31, 2020
(In thousands)	Gross
	Carrying		Accumulated		Net
	Amount		Amortization		Amount
Amortized Intangible Assets
Customer relationships	$	35,563	$	13,614	$	21,949
Patents		338		270		68
LED technology firmware, software		16,066		12,731		3,335
Trade name		2,658		801		1,857
Total Amortized Intangible Assets		54,625		27,416		27,209

Indefinite-lived Intangible Assets
Trademarks and trade names		3,422		-		3,422
Total indefinite-lived Intangible Assets		3,422		-		3,422

Total Other Intangible Assets	$	58,047	$	27,416	$	30,631

Other Intangible Assets	June 30, 2019
(In thousands)	Gross
	Carrying		Accumulated		Net
	Amount		Amortization		Amount
Amortized Intangible Assets
Customer relationships	$	35,563	$	12,070	$	23,493
Patents		338		247		91
LED technology firmware, software		16,066		12,364		3,702
Trade name		2,658		719		1,939
Total Amortized Intangible Assets		54,625		25,400		29,225

Indefinite-lived Intangible Assets
Trademarks and trade names		3,422		-		3,422
Total indefinite-lived Intangible Assets		3,422		-		3,422

Total Other Intangible Assets	$	58,047	$	25,400	$	32,647

	Three Months Ended				Nine Months Ended
	March 31				March 31
(In thousands)	2020		2019		2020		2019

Amortization Expense of Other Intangible Assets	$	670	$	691	$	2,016	$	2,071

The Company expects to record annual amortization expense as follows:

(In thousands)

2020	$	2,687
2021	$	2,682
2022	$	2,459
2023	$	2,412
2024	$	2,412
After 2024	$	16,573