Note 3. Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2015

3. Goodwill and Intangible Assets

The carrying amount of goodwill was $5,703,000 and $0 at December 31, 2015 and December 31, 2014, respectively.

In connection with the acquisition of a controlling interest in GAF discussed in Note 2, the Company recorded $5,703,000 of goodwill and $5,500,000 of intangible assets at December 31, 2015. None of the goodwill is deductible for income tax purposes.

Of the intangible assets of $5,500,000 recorded, $1,000,000 represents the fair value of trademarks, which is being amortized over a period of 8 years, and $4,500,000 represents the fair value of customer relationships being amortized over a period of 9 years.

Intangible assets at December 31, 2015 and 2014 consist of the following (in thousands):

	December 31, 2015						December 31, 2014
	Definitive		Indefinite				Definitive		Indefinite
	Lives (a)		Lives		Total		Lives		Lives		Total
Gross Carrying Value
Balance beginning of period	$	7,442	$	7,500	$	14,942	$	7,442	$	7,500	$	14,942
Additions		5,500		-		5,500		-		-		-
Balance end of period		12,942		7,500		20,442		7,442		7,500		14,942

Accumulated Amortization
Balance beginning of period		(5,027)		-		(5,027)		(3,534)		-		(3,534)
Amortization expense		(1,302)		-		(1,302)		(1,493)		-		(1,493)
Balance end of period		(6,329)		-		(6,329)		(5,027)		-		(5,027)

Net intangible assets	$	6,613	$	7,500	$	14,113	$	2,415	$	7,500	$	9,915

Weighted average remaining life in years					4.49						2.76

Expected amortization expense for the next five years is as follows (in thousands):

		Year Ending
		December 31,
2016	$	1,421
2017		1,236
2018		1,005
2019		848
2020		624
2021 and thereafter		1,479

- 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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