Quarterly report pursuant to Section 13 or 15(d)

GOODWILL AND INTANGIBLE ASSETS, NET

GOODWILL AND INTANGIBLE ASSETS, NET

6 Months Ended

Jun. 30, 2015

GOODWILL AND INTANGIBLE ASSETS, NET [Abstract]

GOODWILL AND INTANGIBLE ASSETS, NET

6. GOODWILL AND INTANGIBLE ASSETS, NET

Goodwill and intangible assets were recorded in relation to the acquisition of TC on October 1, 2014.

Goodwill

The balance of Goodwill was $21.8 million at June 30, 2015, and December 31, 2014. We believe due to the recent nature of the Acquisition, no goodwill impairment existed at June 30, 2015.

Intangible Assets

The following tables summarize the gross carrying amounts and accumulated amortization of intangible assets by major class (in thousands):

	June 30, 2015
Intangible assets subject to amortization (Definite-lived)	Gross		Accumulated Amortization			Net
Customer relationships	$	16,852	$	(842	)	$	16,010
Non-compete agreements		94		(14	)		80
Licenses and permits		1,471		(97	)		1,374
Developed technology		6,131		(460	)		5,671
		24,548		(1,413	)		23,135
Intangible assets not subject to amortization (Indefinite-lived)
Trade name		2,158		-			2,158
Total	$	26,706	$	(1,413	)	$	25,293

	December 31, 2014
Intangible assets subject to amortization (Definite-lived)	Gross		Accumulated Amortization			Net
Customer relationships	$	16,852	$	(281	)	$	16,571
Non-compete agreements		94		(5	)		89
Licenses and permits		1,471		(32	)		1,439
Developed technology		6,131		(153	)		5,978
		24,548		(471	)		24,077
Intangible assets not subject to amortization (Indefinite-lived)
Trade name		2,158		-			2,158
Total	$	26,706	$	(471	)	$	26,235

Amortization expense for intangible assets included in cost of sales for the three months was approximately $471,000 and $942,000 for the six months ended June 30, 2015. There was no amortization expense in the first half of 2014 for these assets.

Based on identified intangible assets that are subject to amortization as of June 30, 2015, we expect future amortization expenses for each period to be as follows (in thousands):

	Remainder of 2015		2016		2017		2018		2019
Customer relationships	$	562	$	1,123	$	1,123	$	1,123	$	1,123
Non-compete agreements		9		19		19		19		14
Licenses and permits		65		123		106		106		106
Developed technology		306		613		613		613		613
Total future amortization expense	$	942	$	1,878	$	1,861		1,861	$	1,856

- 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.

+ References + Details