GOODWILL AND INTANGIBLE ASSETS

9 Months Ended

Sep. 30, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

Detail and activity of goodwill by segment is presented below (in thousands):



	MMS			ATA			Total
Balance at December 31, 2013
Goodwill⁽¹⁾	$	32,434		$	5,154		$	37,588
Accumulated impairment losses	(27,586		)	—			(27,586		)
	4,848			5,154			10,002
Acquisition of Forkardt India	—			1,626			1,626
Impairment loss	(4,848		)	—			(4,848		)
Currency translation adjustments	—			(53		)	(53		)
	(4,848		)	1,573			(3,275		)
Balance at September 30, 2014
Goodwill	32,434			6,727			39,161
Accumulated impairment losses	(32,434		)	—			(32,434		)
	$	—		$	6,727		$	6,727

____________________

⁽¹⁾

In accordance with business combination guidance, changes to the purchase price allocation are adjusted retrospectively to the consolidated financial results. The values above include measurement period adjustments recorded in the nine months ended September 30, 2014 to primarily revise the fair value of other current assets, accrued expenses and AOCI. The December 31, 2013 balances included in the consolidated balance sheets have been revised to include the effect of the measurement period adjustments.

Goodwill is reviewed for possible impairment at least annually or more frequently upon the occurrence of an event or when circumstances indicate that a reporting unit's carrying amount is greater than its fair value. Based on lower than expected performance in the Usach reporting unit during the current year, combined with a downward revision in the anticipated future results, the Company determined that there were indicators of an impairment of that reporting unit. Accordingly, an initial calculation of the fair value was performed, which resulted in the carrying amount of the Usach reporting unit exceeding its fair value, which was estimated based on the present value of expected future cash inflows and market data. Accordingly, a goodwill impairment charge of $4.8 million was recognized in that reporting unit during the third quarter of the current year. This amount is an estimate based on preliminary data, and will be finalized in the fourth quarter in connection with the formal annual impairment test.

The major components of intangible assets other than goodwill are as follows (in thousands):



	September 30, 2014			December 31, 2013
Gross amortizable intangible assets:
Land rights	$	2,827		$	2,865
Patents	3,065			3,030
Technical know-how, customer lists, and other	22,729			21,375
Total gross amortizable intangible assets	28,621			27,270

Accumulated amortization:
Land rights	(217		)	(177		)
Patents	(2,936		)	(2,884		)
Technical know-how, customer lists, and other	(6,463		)	(5,220		)
Total accumulated amortization	(9,616		)	(8,281		)
Amortizable intangible assets, net	19,005			18,989

Indefinite lived intangible assets:
Assets associated with Bridgeport acquisition⁽¹⁾	7,225			7,354
Usach trade name⁽²⁾	630			1,550
Forkardt trade name⁽³⁾	4,170			4,170
	12,025			13,074
Intangible assets other than goodwill, net	$	31,030		$	32,063

____________________


⁽¹⁾	Represents the aggregate value of the trade name, trademarks and copyrights associated with the former worldwide operations of Bridgeport. The Bridgeport brand name is used on all of the machining center lines. After consideration of legal, regulatory, contractual, competitive, economic and other factors, the asset has been determined to have an indefinite useful life.

⁽²⁾

Represents the value of the trade name associated with Usach, which the Company acquired in 2012. The Usach trade name is used on all of the grinding machines and grinding systems manufactured by Usach. After consideration of legal, regulatory, contractual, competitive, economic and other factors, the asset has been determined to have an indefinite useful life. Based on impairment indicators present in the third quarter of the current year as discussed above, the Company performed a review of the valuation of the Usach intangible assets, resulting in an impairment charge to the Usach trade name of $0.9 million. This amount is an estimate based on preliminary data, and will be finalized in the fourth quarter in connection with the formal annual impairment test.


⁽³⁾	Represents the value of the trade name associated with Forkardt, which the Company acquired in 2013. The Forkardt trade name is used on all of the products manufactured by Forkardt. After consideration of legal, regulatory, contractual, competitive, economic and other factors, the asset has been determined to have an indefinite useful life.

Amortization expense related to the definite-lived intangible assets are as follows (in thousands):



	Three Months Ended September 30,				Nine Months Ended September 30,
	2014		2013		2014		2013
Amortization expense	$	448	$	440	$	1,339	$	1,125

- 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.

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