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GOODWILL AND OTHER INTANGIBLE ASSETS
 9 Months Ended
Mar. 28, 2020
Goodwill and Intangible Assets Disclosure [Abstract]  
GOODWILL AND OTHER INTANGIBLE ASSETS
Goodwill and Other Intangible Assets
The Company recorded goodwill and intangible assets in connection with the Ayrshire and Sabre acquisitions resulting primarily in synergies that resulted from the Company's acquisitions and the assembled workforce and favorable lease agreements; respectively.
In accordance with accounting guidance on goodwill and other intangible assets, the Company evaluates goodwill for impairment at the reporting unit level annually, and whenever circumstances occur indicating that goodwill might be impaired. Upon adoption of ASU 2017-04, the Company now recognizes an impairment charge (not to exceed the total amount of goodwill allocated to the reporting unit) for the amount by which the carrying amount of a reporting unit exceeds the reporting unit’s fair value. During the third quarter of fiscal year 2019, a goodwill impairment of $10.0 million and other intangible assets impairment of $2.5 million was recognized.
In accordance with accounting guidance on goodwill and other intangible assets, the Company evaluates intangible assets for impairment at the reporting unit level annually, and whenever circumstances occur indicating that intangibles might be impaired.
During the third quarter for fiscal year 2019, the Company assessed other finite-lived intangible assets including the Company’s customer relationships and favorable lease agreements due to an indicator of possible impairment being present. As a result of the analysis performed, the Company determined that the carrying value of the customer relationships intangible asset was not recoverable and recorded an impairment for the entire carrying amount during the third quarter of fiscal year 2019. This resulted in an impairment charge related to other intangible assets of $2.5 million recognized in the third quarter of fiscal year 2019. The Company’s analysis did not indicate that any of its other long-lived assets were impaired.
During the first quarter of fiscal year 2020, the Company adopted the Accounting Standards Update 2016-02, Leases which supersedes ASC 840 Leases and creates a new topic, ASC 842 Leases. Under ASC 842, any assets or liabilities recognized in accordance with ASC 805 that are related to favorable or unfavorable terms of an operating lease for which an entity is a lessee, the entity should derecognize the asset or liability and commensurately adjust the ROU asset.
As such, the Company derecognized the intangible asset and added the offsetting amount to the ROU asset. Resulting in a reduction of favorable lease agreement intangible of $0.7 million, and no adjustment to retained earnings or future P&L impact.
The components of acquired intangible assets are as follows (in thousands):
 
March 28, 2020
 
Amortization Period
in Years
 
Gross Carrying
Amount
 
Accumulated
Amortization
 
Impairment
Recognized
 
Derecognition Favorable Lease per ASC 842
 
Net Carrying
Amount
Intangible assets:
 
 
 
 
 
 
 
 
 
 
 
Favorable Lease Agreements
4 - 7
 
2,941

 
(2,284
)
 
—

 
(657
)
 
—

Total
 
 
$
2,941

 
$
(2,284
)
 
$
—

 
$
(657
)
 
$
—

 
June 29, 2019
 
Amortization Period
in Years
 
Gross Carrying
Amount
 
Accumulated
Amortization
 
Impairment
Recognized
 
Net Carrying
Amount
Intangible assets:
 
 
 
 
 
 
 
 
 
Non-Compete Agreements
3 - 5
 
$
568

 
$
(568
)
 
$
—

 
$
—

Customer Relationships
10
 
4,803

 
(2,311
)
 
(2,492
)
 
—

Favorable Lease Agreements
4 - 7
 
2,941

 
(2,284
)
 
—

 
657

Total
 
 
$
8,312

 
$
(5,163
)
 
$
(2,492
)
 
$
657


Amortization expense was approximately $0 and $76,000 for the three months ended March 28, 2020 and March 30, 2019, respectively. Amortization expense was approximately $0 and $502,000 for the nine months ended March 28, 2020 and March 30, 2019, respectively.