Annual report pursuant to Section 13 and 15(d)

Intangible Assets

v3.20.1
Intangible Assets
12 Months Ended
Dec. 31, 2019
Goodwill and Intangible Assets Disclosure [Abstract]  
Intangible Assets INTANGIBLE ASSETS
The following table details amounts related to our intangible assets:
 
 
 
December 31, 2019
 
December 31, 2018
 
Estimated Useful Life
 
Gross Carrying Amount
 
Accumulated Amortization
 
Gross Carrying Amount
 
Accumulated Amortization
Long-lived intangible assets
 
 
 
 
 
 
 
 
Contractual arrangements
5 years
 
$
36.4

 
$
17.3

 
$
36.4

 
$
10.7

Intellectual property
2-15 years
 
5.3

 
1.7

 
5.0

 
1.3

Subtotal
 
 
41.7

 
$
19.0

 
41.4

 
$
12.0

Indefinite-lived intangible assets
 
 
 
 
 
 
 
 
Trademarks and brand names
Indefinite
 
2.7

 
 
 
2.6

 
 
Total
 
 
$
44.4

 
 
 
$
44.0

 
 

 
 
Year Ended December 31,
 
 
2019
 
2018
 
2017
Amortization expense
 
$
7.0

 
$
7.2

 
$
4.2



During the second quarter of 2017, we acquired vinyl composition tile ("VCT") assets for $36.1 million, consisting of equipment and trademarks of Mannington Mills, Inc. ("Mannington Mills") under an agreement that included non-compete provisions. We allocated $33.6 million of the purchase price to intangible assets and the remainder to inventories and equipment. The assigned intangible asset classes were contractual arrangements, $33.3 million, with an estimated useful life of five years, and intellectual property, $0.3 million, with an estimated useful life of two years.

In addition, Mannington Mills was eligible for contingent consideration of up to $9.0 million based on sales of our VCT flooring products for the twelve month periods ending June 30, 2019 and June 30, 2020 (“measurement periods”) compared to a base period of combined AFI and Mannington Mills sales for the 12 month period ended June 30, 2017. The contingent consideration was tiered for each of the separate twelve month measurement periods ranging from consideration of zero to a maximum of $4.5 million in each measurement period. No contingent consideration was due for the twelve month period ending June 30, 2019. No contingent liability has been recognized for the twelve month period ending June 30, 2020 as we concluded that such liability is not probable. Any contingent liability recognized will be recorded as an adjustment to the value of the acquired assets.

 
2020
 
2021
 
2022
 
2023
2024
Expected annual amortization expense
$
7.0

 
$
7.0

 
$
3.7

 
$
0.4

$
0.4