5.Franchise Rights and Goodwill

Franchise rights and goodwill consisted of the following:

(in thousands)	October 2, 2016		January 3, 2016		September 27, 2015
Franchise rights	$	533,040	$	527,540	$	527,540
Goodwill		141,271		117,954		113,835
Total franchise rights and goodwill	$	674,311	$	645,494	$	641,375

A reconciliation of the activity for franchise rights and goodwill for the first three quarters of 2016 and the first three quarters of 2015 is as follows:

(in thousands)	Franchise rights		Goodwill			Total
Balance on December 28, 2014	$	520,672	$	106,220		$	626,892
YTD 2015 Expansion Territories		-		6,233			6,233
Asset Exchange Transaction		6,868		312			7,180
Measurement period adjustment		-		1,070			1,070
Balance on September 27, 2015	$	527,540	$	113,835		$	641,375

Balance on January 3, 2016	$	527,540	$	117,954		$	645,494
YTD 2016 Expansion Transactions		-		22,031			22,031
Asset Exchange Transaction		5,500		(682	)		4,818
Measurement period adjustment		-		1,968			1,968
Balance on October 2, 2016	$	533,040	$	141,271		$	674,311

The Company’s goodwill and franchise rights reside entirely within the Nonalcoholic Beverage segment. The Company performs its annual impairment test of franchise rights and goodwill as of the first day of the fourth quarter. During the first three quarters of 2016, the Company did not experience any triggering events or changes in circumstances indicating the carrying amounts of the Company’s franchise rights or goodwill exceeded fair values.

In the second quarter of 2016, the Company recorded $5.5 million in franchise rights for the Lexington Expansion Territory.