Intangible Assets

6 Months Ended

Jun. 28, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Amortized intangible assets consisted of the following (in thousands):


	Gross Carrying Value		Accumulated Amortization		Net Carrying Value
Distribution networks	$	38,060	$	38,060	$	—
Completed technologies	21,917		11,035		10,882
Customer relationships	10,578		6,795		3,783
In-process technologies	2,300		—		2,300
Non-compete agreements	710		409		301
Trademarks	110		39		71
Balance as of June 28, 2020	$	73,675	$	56,338	$	17,337

	Gross Carrying Value		Accumulated Amortization		Net Carrying Value
Distribution networks	$	38,060	$	38,060	$	—
Completed technologies	31,987		9,160		22,827
Customer relationships	14,407		6,402		8,005
In-process technologies	8,200		—		8,200
Non-compete agreements	710		350		360
Trademarks	110		12		98
Balance as of December 31, 2019	$	93,474	$	53,984	$	39,490

The significant decline in business levels resulting from the COVID-19 pandemic triggered a review of long-lived assets, including intangible assets, for potential impairment during the three-month period ended June 28, 2020. For finite-lived intangible assets that are subject to amortization, the Company follows a two-step process for impairment testing. In step one, known as the recoverability test, the carrying value of the asset is compared to the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. If the sum of the undiscounted future cash flows is less than the carrying value, the asset is not recoverable and step two is performed. In step two, the impairment charge is measured as the amount by which the carrying value of the asset exceeds its fair value. For indefinite-lived intangible assets that are not subject to amortization, the fair value of the asset is measured and an impairment charge is recorded as the amount by which the carrying value of the asset exceeds its fair value.

Based upon this assessment, management concluded that certain of the Company's finite-lived intangible assets failed the recoverability test, and recorded impairment charges for these assets equal to the amount by which their carrying value exceeded their fair value. The Company also measured the fair value and recorded an impairment charge for its indefinite-lived intangible asset related to in-process technologies. The fair values were established, with the assistance of an outside valuation advisor, using the income approach based upon a discounted cash flow model that estimated future revenue streams and expenses attributable to those revenue streams provided by management.

This review resulted in intangible asset impairment charges totaling $19,571,000 for the three-month period ended June 28, 2020, primarily related to lower projected cash flows from the technologies and customer relationships acquired from Sualab Co. Ltd. ("Sualab") as a result of the deteriorating global economic conditions from the COVID-19 pandemic. Completed technologies, in-process technologies, and customer relationships acquired from Sualab were impaired in the amounts of $10,070,000, $5,900,000, and $3,382,000, respectively. In addition, customer relationships acquired from EnShape GmbH that had a gross carrying value of $447,000 and accumulated amortization of $228,000 on the measurement date were reduced to zero, resulting in an impairment charge of $219,000.

As of June 28, 2020, estimated future amortization expense related to intangible assets was as follows (in thousands):


Year Ended December 31,	Amount
Remainder of fiscal 2020	$	1,686
2021	3,272
2022	2,902
2023	2,211
2024	1,697
2025	1,374
Thereafter	1,895
	$	15,037

In-process technology is an indefinite-lived intangible asset until the technology is finalized, at which point it is amortized over its estimated useful life.