OfficeMax 2007 Annual Report Download - page 73
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2006
Gross Carrying Accumulated Net Carrying
Amount Amortization Amount
(thousands)
Trade names .......................... $173,150 $ — $ 173,150
Customer lists and relationships ............ 39,681 (17,678) 22,003
Noncompete agreements ................. 12,853 (8,213) 4,640
Exclusive distribution rights ................ 3,616 (2,105) 1,511
$229,300 $(27,996) $201,304
Intangible asset amortization expense totaled $7.0 million in 2007, $7.3 million in 2006 and
$6.8 million in 2005. The estimated amortization expense is $5.5 million, $2.2 million, $2.0 million,
$1.6 million, $1.6 million and $1.6 million in 2008, 2009, 2010, 2011, 2012 and 2013, respectively.
During the first quarter of both 2007 and 2006, the Company evaluated the remaining useful
lives of finite-lived purchased intangible assets to determine if any adjustments to the useful lives
were necessary. Based on this review, management determined that no adjustments to the useful
lives of finite-lived purchased intangible assets were necessary.
11. Timber Notes Receivable
In October 2004, OfficeMax sold its timberlands as part of the Sale. In exchange for the
timberlands, the Company received timber installment notes receivable in the amount of
$1,635 million, which were credit enhanced with guarantees. The guarantees were issued by highly-
rated financial institutions and were secured by the pledge of underlying collateral notes issued by
the credit enhancement banks. The timber installment notes receivable are 15-year non-amortizing.
There are two notes that total $817.5 million bearing interest at 4.982% and a third note in the
amount of $817.5 million bearing interest at 5.112%. Interest earned on all of the notes is received
semiannually. See the sub-caption ‘‘Timber Notes’’ in Note 12, Debt, for additional information
concerning a securitization transaction involving the timber installment notes receivable.
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