Annual report pursuant to Section 13 and 15(d)

CUSTOMER CONTRACTS AND OTHER INTANGIBLE ASSETS

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CUSTOMER CONTRACTS AND OTHER INTANGIBLE ASSETS
12 Months Ended
Dec. 31, 2016
Current Income Tax Benefit Due to Release of Valuation Allowance  
CUSTOMER CONTRACTS AND OTHER INTANGIBLE ASSETS
9. CUSTOMER CONTRACTS AND OTHER INTANGIBLE ASSETS

 

Customer contracts are amortized on a straight-line basis over the period of the agreements, as straight-line best approximates the ratio that current revenues bear to the total of current and anticipated revenues, based on the estimated lives of the assets. In accordance with the FASB ASC Topic 350 “Intangibles - Goodwill and other”, the expected lives of customer contracts were reviewed, and it was determined that customer contracts should be amortized over a life of 7 to 20 years dependent upon customer type. The carrying amount and accumulated amortization for customer contracts were as follows:

 

December 31,   2016     2015  
(in thousands)            
Customer contracts   $ 251,194     $ 214,201  
Less:  Accumulated amortization     (133,728 )     (121,386 )
Customer contracts, net   $ 117,466     $ 92,815  

 

The carrying amount of customer contracts in foreign countries was $29.7 million as of December 31, 2016 and $14.9 million as of December 31, 2015.

 

Other intangible assets include non-compete agreements, patents and finite lived and indefinite lived trade names. Non-compete agreements are amortized on a straight-line basis over periods ranging from 3 to 20 years and patents are amortized on a straight-line basis over 15 years. The carrying amount and accumulated amortization for other intangible assets were as follows:

 

At December 31,   2016     2015  
(in thousands)            
Other intangible assets   $ 56,937     $ 56,491  
Less:  Accumulated amortization     (12,627 )     (10,375 )
Other intangible assets, net   $ 44,310     $ 46,116  

 

The carrying amount of other intangible assets in foreign countries was $3.8 million as of December 31, 2016 and $4.2 million as of December 31, 2015.

 

Included in the table above are trademarks and trade names of $32.7 million and $32.8 million at December 31, 2016 and 2015, respectively. Also included in the table above are non-amortizable, indefinite lived intangible assets of $29.7 million at December 31, 2016 and 2015, respectively.

 

The carrying amount of customer contracts and other intangible assets, net were as follows:

 

December 31,   2016     2015  
(in thousands)            
Customer contracts, net   $ 117,466     $ 92,815  
Other intangible assets, net     44,310       46,116  
Customer contracts and other intangible assets, net   $ 161,776     $ 138,931  

 

Total amortization expense was approximately $26.2 million in 2016, $25.2 million in 2015 and $26.9 million in 2014.

 

Estimated amortization expense for the existing carrying amount of customer contracts and other intangible assets for each of the five succeeding fiscal years are as follows:

 

(in thousands)    
2017     $ 26,630  
2018       23,219  
2019       20,339  
2020       15,937  
2021     $ 13,774