CJ 2017 Annual Report

the multiples could reduce the estimated fair value of any of the three reporting units below their respective carrying values. Earnings estimates were derived from unobservable inputs that require significant estimates, judgments and assumptions as described in the income approach. The estimated fair value determined under the income approach was consistent with the estimated fair value determined under the market approach. The concluded fair value for the Completion Services and Well Support Services reporting units consisted of a weighted average, with an 80.0% weight under the income approach and a 20.0% weight under the market approach. The concluded fair value for the Other Services reporting unit consisted of a weighted average with a 50.0% weight under the income approach and a 50.0% weight under the market approach. The results of the Step 1 impairment testing indicated potential impairment in the Well Support Services reporting unit. The goodwill associated with both the Completion Services and Other Services reporting units was completely impaired during the third quarter of 2015. As a way to validate the estimated reporting unit fair values, the total market capitalization of the Company was compared to the total estimated fair value of all reporting units, and an implied control premium was derived. Market data in support of the implied control premium was used in this reconciliation to corroborate the estimated reporting unit fair values. Step 2 of the goodwill impairment testing for the Well Support Services reporting units was performed during the first quarter of 2016, and the results concluded that there was no value remaining to be allocated to the goodwill associated with this reporting unit. As a result, the Company recognized impairment expense of $314.3 million during 2016. As of December 31, 2016, there was no goodwill remaining to be allocated across the Company's three reporting units. The changes in the carrying amount of goodwill for the years ended December 31, 2017 and 2016 are as follows (in thousands): Completion Services Well Support Services Total As of December 31, 2015 (Predecessor) $ — $ 307,677 $ 307,677 Measurement period adjustments 8 5,382 5,390 Impairment expense (8) (314,293) (314,301) Foreign currency translation and other adjustments — 1,234 1,234 As of December 31, 2016 (Predecessor) — — — O-Tex acquisition 147,515 — 147,515 As of December 31, 2017 (Successor) $ 147,515 $ — $ 147,515 Indefinite-Lived Intangible Assets As of December 31, 2016, the Company had approximately $6.0 million of intangible assets with indefinite useful lives, which were subject to annual impairment tests or more frequently if events or circumstances indicate the carrying amount may not be recoverable. The Company’s intangible assets associated with intellectual property, research and development (“IPR&D”) consist of technology that is still in the testing phase; however, given the continued market downturn management has made the decision to postpone these projects. Based on the Company's evaluation, it was determined that the IPR&D carry value of $6.0 million was impaired and written down to zero as of December 31, 2016. As of December 31, 2017, the Company has not acquired additional indefinite-lived intangible assets, and the IPR&D intangible assets remain at zero. Definite-Lived Intangible Assets The Company reviews definite-lived intangible assets, along with PP&E, for impairment when a triggering event indicates that the asset may have a net book value in excess of recoverable value. During 2016, management determined the sustained low commodity price levels coupled with the sustained decrease in the Company’s share price were deemed triggering events that provided indicators that its definite-lived intangible assets may be impaired. The Company performed a C&J ENERGY SERVICES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 96