Goodwill and Other Intangible Assets

Goodwill and other intangible assets included in the Consolidated Balance Sheets consisted of the following (in thousands):



	December 29, 2018		December 30, 2017
Goodwill	$	270,788	$	279,505
Definite-lived intangible assets	163,714		182,186
Indefinite-lived intangible assets	28,788		29,201
Total goodwill and other intangible assets	$	463,290	$	490,892

Goodwill

The changes in the carrying amount of goodwill, by reporting segment, are as follows (in thousands):



	Office Furniture			Hearth Products			Total
Balance as of December 31, 2016
Goodwill	$	137,889		$	183,199		$	321,088
Accumulated impairment losses	(30,246		)	(143		)	(30,389		)
Net goodwill balance as of December 31, 2016	107,643			183,056			290,699

Impairment losses	(4,838		)	—			(4,838		)
Foreign currency translation adjustment	(44		)	—			(44		)
Impairment loss due to closure of an office furniture brand	(6,312		)	—			(6,312		)

Balance as of December 30, 2017
Goodwill	128,657			183,199			311,856
Accumulated impairment losses	(32,208		)	(143		)	(32,351		)
Net goodwill balance as of December 30, 2017	96,449			183,056			279,505

Goodwill acquired during the year	—			3,463			3,463
Impairment losses	(12,168		)	—			(12,168		)
Foreign currency translation adjustment	(12		)	—			(12		)

Balance as of December 29, 2018
Goodwill	128,645			186,662			315,307
Accumulated impairment losses	(44,376		)	(143		)	(44,519		)
Net goodwill balance as of December 29, 2018	$	84,269		$	186,519		$	270,788

The increases in goodwill relate to completed acquisitions. See "Note 5. Acquisitions and Divestitures" in the Notes to Consolidated Financial Statements for further information. The decreases in goodwill in the office furniture segment were due to impairment charges, which are described below.

Definite-lived intangible assets

The table below summarizes amortizable definite-lived intangible assets, which are reflected in "Goodwill and Other Intangible Assets" in the Corporation’s Consolidated Balance Sheets (in thousands):



	December 29, 2018						December 30, 2017
	Gross		Accumulated Amortization		Net		Gross		Accumulated Amortization		Net
Patents	$	40	$	34	$	6	$	40	$	26	$	14
Software	170,274		49,561		120,713		167,105		34,792		132,313
Trademarks and trade names	7,564		2,721		4,843		7,564		2,061		5,503
Customer lists and other	103,840		65,688		38,152		106,090		61,734		44,356
Net definite-lived intangible assets	$	281,718	$	118,004	$	163,714	$	280,799	$	98,613	$	182,186

Amortization expense is reflected in "Selling and administrative expenses" in the Consolidated Statements of Comprehensive Income and was as follows (in thousands):



	2018		2017		2016
Capitalized software	$	17,109	$	9,389	$	4,722
Other definite-lived intangibles	$	6,615	$	6,989	$	7,055

The occurrence of events such as acquisitions, dispositions, or impairments may impact future amortization expense. Based on the current amount of intangible assets subject to amortization, the estimated amortization expense for each of the following five fiscal years is as follows (in millions):



	2019		2020		2021		2022		2023
Amortization expense	$	23.8	$	22.9	$	21.6	$	19.2	$	16.9

Indefinite-lived intangible assets

The Corporation also owns certain intangible assets, which are deemed to have indefinite useful lives because they are expected to generate cash flows indefinitely. These indefinite-lived intangible assets are reflected in "Goodwill and Other Intangible Assets" in the Consolidated Balance Sheets (in thousands):



	December 29, 2018		December 30, 2017
Trademarks and trade names	$	28,788	$	29,201

As a result of the required annual impairment assessment performed in the fourth quarter of 2018, the Corporation did not record any impairment charges related to indefinite-lived intangible assets.

Sale and License of an Intangible Asset

In the third quarter of 2017, the Corporation recorded a $6.0 million nonrecurring gain from the sale and license of an intangible asset, which had a zero carrying value. This nonrecurring gain is reflected in "(Gain) loss on sale, disposal, and license of assets" in the Consolidated Statements of Comprehensive Income.

Impairment Analysis

As a result of the required annual impairment assessment performed in the fourth quarter of 2018, the Corporation determined the fair value of a reporting unit within the office furniture segment was below its carrying value. This reporting unit had triggering events in both the second and third quarters of 2018 due to lower projected operating results, and was tested with interim quantitative impairment tests that resulted in no impairment either time. In the fourth quarter of 2018, a further decline in the estimated fair value of this reporting unit was primarily driven by reduced long-term margin expectations and resulted in an impairment. The projections used in the impairment model reflected management's assumptions regarding revenue growth rates, economic and market trends, cost structure, investments required for product enhancements, and other expectations about the anticipated short-term and long-term operating results of the reporting unit. The Corporation assumed a discount rate of 14 percent, near term growth rates ranging from 1 percent to 6 percent, and a terminal growth rate of 3 percent. Based on the quantitative analysis, the Corporation recorded a $12.2 million goodwill impairment charge in 2018, which is reflected in "Goodwill and Other Intangible Assets" in the Corporation's Consolidated Balance Sheets. There was $7.5 million net goodwill remaining in the reporting unit as of December 29, 2018. Holding other assumptions constant, a 100 basis point increase in the discount rate would result in a $2.3 million decrease in the estimated fair value of the reporting unit. Holding other assumptions constant, a 50 basis point decrease in the long-term growth rate would result in a $0.5 million decrease in the estimated fair value of the reporting unit.

Prior to the goodwill impairment assessment, the Corporation completed a qualitative review of long-lived assets for all asset groups to determine if events or changes in circumstances indicated that the carrying amount of each asset group may not be recoverable (if a "triggering event" existed). Based on this review, the Corporation tested the recoverability of the long-lived assets, other than goodwill and indefinite-lived intangible assets, in a certain asset groups where a triggering events existed, and found no impairments. Trigger events were noted in these certain asset groups in the second and third quarters of 2018 and no impairments were found.

Based on the results of the annual impairment test, the Corporation concluded that no other goodwill impairment existed apart from the impairment charges discussed above. For all other reporting units included in the annual quantitative impairment test, the estimated fair value is significantly in excess of the carrying value.