Goodwill and Intangible Assets

9 Months Ended

Sep. 30, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

Note 6. Goodwill and Intangible Assets

Goodwill and intangible assets, consisting of trade names, trademarks, trade dress, patents and other intangible assets, were acquired in connection with the acquisitions of Odyssey Sports, Inc. in 1997, FrogTrader, Inc. in 2004 (which represents the Company's pre-owned business), OGIO in January 2017, TravisMathew in August 2017 (see Note 2) and certain foreign distributors. Internally developed intangible assets are expensed as incurred.

The Company’s goodwill and acquired intangible assets with indefinite lives are not amortized, but are subject to an annual impairment test. The Company performs an impairment analysis on its goodwill and intangible assets at least annually and whenever events or changes in circumstances indicate that the carrying value of such assets may not be fully recoverable. Acquired intangible assets with definite lives are amortized over their estimated useful lives and are tested for impairment only when impairment indicators are present.

Goodwill at September 30, 2017 and December 31, 2016 was $56,091,000 and $25,593,000, respectively. During the nine months ended September 30, 2017, the Company recorded additions to goodwill of $5,885,000 and $23,436,000 as a result of the acquisitions of OGIO completed in January 2017 and TravisMathew completed in August 2017, respectively. Goodwill also increased $1,178,000 during the nine months ended September 30, 2017, due to foreign currency fluctuations combined with measurement adjustments identified subsequent to the acquisition date.

The following sets forth the intangible assets by major asset class (dollars in thousands):



	Useful Life (Years)	September 30, 2017							December 31, 2016
	Useful Life (Years)	Gross		Accumulated Amortization			Net Book Value		Gross		Accumulated Amortization			Net Book Value
Non-Amortizing:
Trade name, trademark and trade dress and other	NA	$	216,690		$	—	$	216,690	$	88,590		$	—	$	88,590
Amortizing:
Patents	2-16	31,581			31,478		103		31,581			31,440		141
Other	1-10	15,780			8,222		7,558		7,981			7,981		—
Total intangible assets		$	264,051		$	39,700	$	224,351	$	128,152		$	39,421	$	88,731

The increase in intangible assets is related to the acquisition of non-amortizing trademarks, trade names and goodwill in addition to amortizing intangibles in connection with the OGIO and TravisMathew acquisitions. Aggregate amortization expense related to intangible assets was approximately $280,000 and $59,000 for the nine months ended September 30, 2017 and 2016, respectively.

Amortization expense related to intangible assets at September 30, 2017 in each of the next five fiscal years and beyond is expected to be incurred as follows (in thousands):



Remainder of 2017	$	267
2018	1,066
2019	1,053
2020	966
2021	910
2022	734
Thereafter	2,665
	$	7,661

- 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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