OfficeMax 2015 Annual Report Download - page 82
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Table of Contents
decreased by $16 million and tax account adjustments were $1 million. Goodwill of $24 million was allocated to the Grupo OfficeMax business and was
removed following the August 2014 sale of that business.
Definite-lived intangible assets are reviewed periodically to determine whether events and circumstances indicate the carrying amount may not be
recoverable or the remaining period of amortization should be revised. In connection with implementing the Real Estate Strategy in 2015 and 2014, the
Company recognized impairment charges associated with favorable leases related to identified closing locations totaling $1 million and $5 million,
respectively. These impairment charges are presented in Asset impairments in the Consolidated Statements of Operations. Refer to Note 15 for additional
information on fair value measurement and Real Estate Strategy.
During 2014, the Company reassessed its use of a $6 million private brand trade name used internationally that previously had been assigned an indefinite
life. The expected change in profile and life of this brand, along with assigning an estimated life of three years, resulted in an impairment charge of $5 million
which is reported in Asset impairments in the Consolidated Statement of Operations.
Definite-lived intangible assets, which are included in Other intangible assets, net in the Consolidated Balance Sheets, are as follows:
(In millions)
Customer relationships
Favorable leases
Trade names
Total
December 27, 2014
(In millions)
Gross
Carrying Value
Accumulated
Amortization
Net
Carrying Value
Customer relationships $ 77 $ (37) $ 40
Favorable leases 36 (8) 28
Trade names 9 (5) 4
Total $ 122 $ (50) $ 72
Definite-lived intangible assets generally are amortized using the straight-line method. The pattern of benefit associated with one customer relationship asset
recognized as part of the Merger warranted a three-year accelerated declining balance method. Favorable leases are amortized using the straight-line method
over the lives of the individual leases, including option renewals anticipated in the original valuation. The remaining weighted average amortization periods
for customer relationships and favorable leases are 5 years, and 16 years, respectively.
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