4. Additional Balance Sheet Information

The composition of accounts and notes receivable is as follows:

	May 28, 2015		May 29, 2014
	(in thousands)
Trade receivables, net of allowances of $245 and $1,423, respectively	$	6,363	$	5,023
Other receivables		9,976		4,449
	$	16,339	$	9,472

The composition of property and equipment, which is stated at cost, is as follows:

	May 28, 2015		May 29, 2014
	(in thousands)
Land and improvements	$	98,980	$	97,611
Buildings and improvements		633,946		613,873
Leasehold improvements		78,624		62,379
Furniture, fixtures and equipment		279,383		270,993
Construction in progress		8,392		5,843
		1,099,325		1,050,699
Less accumulated depreciation and amortization		419,208		399,119
	$	680,117	$	651,580

The composition of other assets is as follows:

	May 28, 2015		May 29, 2014
	(in thousands)
Favorable lease right	$	10,014	$	10,348
Split dollar life insurance policies		13,584		12,944
Other assets		10,391		11,503
	$	33,989	$	34,795

The accompanying May 29, 2014 balance sheet has been revised to include the condominium units in property and equipment. The condominium units were previously recorded as other assets.

The Company’s $13,353,000 favorable lease right is being amortized over the expected term of the underlying lease of 40 years and is expected to result in amortization of $334,000 in each of the five succeeding fiscal years. Accumulated amortization of the favorable lease right was $3,339,000 and $3,005,000 as of May 28, 2015 and May 29, 2014, respectively.

Capital Lease Obligation - During fiscal 2012, the Company entered into a master licensing agreement with CDF2 Holdings, LLC, a subsidiary of Cinedigm Digital Cinema Corp. (CDF2), whereby CDF2 purchased on the Company’s behalf, and then deployed and licensed back to the Company, digital cinema projection systems (the “systems”) for use by the Company in its theatres. As of May 28, 2015, 642 of the Company’s screens were utilizing the systems under a 10-year master licensing agreement with CDF2. Included in furniture, fixtures and equipment is $45,510,000 related to the digital systems as of May 28, 2015 and May 29, 2014, which is being amortized over the remaining estimated useful life of the assets. Accumulated amortization of the digital systems was $18,435,000 and $12,259,000 as of May 28, 2015 and May 29, 2014, respectively.

Under the terms of the master licensing agreement, the Company made an initial one-time payment to CDF2. The Company expects that the balance of CDF2’s costs to deploy the systems will be covered primarily through the payment of virtual print fees (VPF’s) from film distributors to CDF2 each time a digital movie is booked on one of the systems deployed on a Company screen. The Company agreed to make an average number of bookings of eligible digital movies on each screen on which a licensed system has been deployed to provide for a minimum level of VPF’s paid by distributors (standard booking commitment) to CDF2. To the extent the VPF’s paid by distributors are less than the standard booking commitment, the Company must make a shortfall payment to CDF2. Based upon the Company’s historical booking patterns, the Company does not expect to make any shortfall payments during the life of the agreement. Accounting Standards Codification No. 840, Leases, requires that the Company consider the entire amount of the standard booking commitment minimum lease payments for purposes of determining the capital lease obligation. The maximum amount per year that the Company could be required to pay is approximately $6,163,000 until the obligation is fully satisfied.

The Company’s capital lease obligation is being reduced as VPF’s are paid by the film distributors to CDF2. The Company has recorded the reduction of the obligation associated with the payment of VPF’s as a reduction of the interest related to the obligation and the amortization incurred related to the systems, as the payments represent a specific reimbursement of the cost of the systems by the studios. Based on the Company's expected minimum number of eligible movies to be booked, the Company expects the obligation to be reduced by at least $5,053,000 within the next 12 months. This reduction will be recognized as an offset to amortization and is expected to offset the majority of the amortization of the systems.