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Note 6 - Goodwill and Intangible Assets | 6 Months Ended
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Jun. 30, 2020
Notes to Financial Statements |
Goodwill and Intangible Assets Disclosure [Text Block] |
6. | Goodwill and Intangible Assets
Goodwill Goodwill represents the difference between the purchase price and the estimated fair value of identifiable assets acquired and liabilities assumed. Goodwill acquired in a business combination and determined to have an indefinite useful life is not amortized, but instead is tested for impairment at least annually in accordance with ASC 350. The following table represents the change in the carrying value of goodwill for the three months ended June 30, 2020:
(In thousands) |  |  |  |
Balance as of December 31, 2019 |  | $ | 33,637 |
Correction of an error related to CBS goodwill |  |  | (131 | )
Balance as of June 30, 2020 |  | $ | 33,506 |
We adjusted goodwill from the CBS Acquisition related to an immaterial error of $131,000 in payables that were paid during closing and incorrectly recorded as liabilities in our purchase price accounting as of December 31, 2019. We reduced our goodwill and accounts payable by $131,000. Intangible Assets Intangible assets, net consisted of the following at June 30, 2020:
(In thousands, except weighted average useful life) |  | June 30, 2020 |  |  |  |  |
Finite-lived intangible assets: |  | Gross Carrying Value |  |  | Accumulated Amortization |  |  | Net Carrying Value |  |  | Weighted Average Useful Life (in years) |
Customer Relationships |  | $ | 800 |  |  | $ | (124 | ) |  | $ | 676 |  |  |  | 4.8 |
Tradenames |  |  | 2,590 |  |  |  | (289 | ) |  |  | 2,301 |  |  |  | 7.2 |
Technology – acquired (1) |  |  | 19,670 |  |  |  | (2,059 | ) |  |  | 17,611 |  |  |  | 7.6 |
Total intangible assets |  | $ | 23,060 |  |  | $ | (2,472 | ) |  | $ | 20,588 |  |  |  | 7.4 |
(1) We transferred $650,000 out of “in-process R&D” into “Technology – acquired” on April 1, 2020, which was the date on which the product line became technologically feasible. Intangible assets, net consisted of the following at December 31, 2019:
(In thousands, except weighted average useful life) |  | December 31, 2019 |  |  |  |  |
Finite-lived intangible assets: |  | Gross Carrying Value |  |  | Accumulated Amortization |  |  | Net Carrying Value |  |  | Weighted Average Useful Life (in years) |
Customer Relationships |  | $ | 800 |  |  | $ | (51 | ) |  | $ | 749 |  |  |  | 5.6 |
Tradenames |  |  | 2,590 |  |  |  | (123 | ) |  |  | 2,467 |  |  |  | 8.1 |
Technology – acquired |  |  | 19,020 |  |  |  | (904 | ) |  |  | 18,116 |  |  |  | 8.4 |
In-process R&D (2) |  |  | 650 |  |  |  | — |  |  |  | 650 |  |  |  | 9.0 |
Total intangible assets |  | $ | 23,060 |  |  | $ | (1,078 | ) |  | $ | 21,982 |  |  |  | 8.3 |
(2) In-process R&D represents the fair value of incomplete research and development that has not yet reached technological feasibility. On April 1, 2020, we began amortizing the asset since it reached technological feasibility (see footnote 1 above). Amortization expense for finite-lived intangible assets was $706,000 and $1.4 million for the three and six months ended June 30, 2020, respectively and $104,000 for the three and six months ended June 30, 2019. In-process research and development was put into service in the second quarter of 2020, as such we have included the amortization in the schedule below based on an estimated life of 9 years. As of June 30, 2020, the Company expects to record the following amortization expense:
(In thousands) For the Years Ended December 31, |  | Estimated Amortization Expense |
2020 (6 months remaining) |  | $ | 1,412 |
2021 |  |  | 2,825 |
2022 |  |  | 2,825 |
2023 |  |  | 2,795 |
2024 |  |  | 2,770 |
Thereafter |  |  | 7,961 |
Total |  | $ | 20,588 |

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- Definition The entire disclosure for goodwill and intangible assets. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 350 -URI http://asc.fasb.org/topic&trid=2144416 + Details
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