Goodwill and Other Intangible Assets

9 Months Ended

Sep. 30, 2013

Goodwill And Intangible Assets Disclosure [Abstract]

3. GOODWILL AND OTHER INTANGIBLE ASSETS

The Company’s intangible assets not subject to amortization consisted of the following (in thousands):


	September 30, 2013 (1)		December 31, 2012 (2)
Goodwill	$	—	$	60,744
Trade names	$	—	$	27,000

(1)

The table above does not reflect the portion of goodwill of $7.1 million, as such non-amortizable intangible asset has been included in long-lived assets within assets held for sale as of September 30, 2013. This amount is attributable to the remaining portion of North America Telecom, PTI, ($3.7 million) and ICS ($3.4 million).

(2)	The table above does not reflect the portion of goodwill of $3.4 million, as such non-amortizable intangible asset has been included in long-lived assets within assets held for sale as of December 31, 2012. This amount is attributable to ICS.

Goodwill

The sale of BLACKIRON Data and the announcement of the sale of North America Telecom during the second quarter of 2013 were considered triggering events under ASC 350 and the Company tested the goodwill of the Canada and US reporting units for impairment. The proceeds from each of the transactions were used as a measurement of fair value. Based on the carrying values of the Canada and US reporting units, the Company determined that goodwill was not impaired as of June 30, 2013.

The changes in the carrying amount of goodwill by reporting unit for the nine months ended September 30, 2013 are as follows (in thousands):


	United States			Canada			Total
Balance as of December 31, 2012	$	26,582		$	34,162		$	60,744
Effect of change in foreign currency exchange rates		—			(776	)		(776	)
Disposition of business		(22,568	)		(33,386	)		(55,954	)
Allocation to disposal group		(4,014	)		—			(4,014	)

Balance as of September 30, 2013	$	—		$	—		$	—

As discussed in Note 10—“Discontinued Operations,” the Company sold its BLACKIRON Data segment during the second quarter of 2013. BLACKIRON Data was part of the Canada reporting unit, and therefore an allocation of the goodwill of the Canada reporting unit was made to the disposed entity. Prior to its disposal, the Company allocated, based on relative fair value to the Canada reporting unit in total, $20.2 million of goodwill to BLACKIRON Data.

On July 31, 2013, the Company completed the initial closing of the sale of the North America Telecom segment. A portion of North America Telecom included in the initial closing represented the remaining portion of goodwill, or $13.2 million, of the Canada reporting unit. In addition, regarding the US reporting unit, prior to its disposal, the Company allocated, based on relative fair value to the US reporting unit in total, $22.6 million of goodwill to the disposed entities of North America Telecom. The remaining goodwill of the US reporting unit of $4.0 million is applicable to PTI.

Trade Names

In conjunction with the initial closing of the sale of the North America Telecom segment, the Company also assigned the trademarks used by the North America Telecom segment to affiliates of York Capital Management. The value of the assigned trademarks was $27.0 million, less a deferred tax liability of $10.5 million.

Amortizable Intangible Assets

Intangible assets subject to amortization consisted of the following (in thousands):


	September 30, 2013 (1)						December 31, 2012
	Gross Carrying Amount		Accumulated Amortization		Net Book Value		Gross Carrying Amount		Accumulated Amortization			Net Book Value
Trade names	$	—	$	—	$	—	$	3,500	$	(1,140	)	$	2,360
Customer relationships		—		—		—		94,142		(60,478	)		33,664

Total	$	—	$	—	$	—	$	97,642	$	(61,618	)	$	36,024

(1)

The table above does not reflect the portion of the net book value of PTI customer relationships of $0.4 million, as such amortizable intangible asset has been included in long-lived assets within assets held for sale as of September 30, 2013. The net book value of the amortizable intangible assets attributable to BLACKIRON Data and the entities that were a part of the initial closing of the sale of North America Telecom were purchased by the buyers.

- 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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