Property and Equipment:



	Successor			Predecessor
	December 28, 2014			December 29, 2013
	(in thousands)
Land	$	50,135		$	43,423
Buildings	50,132			110,817
Leasehold improvements	397,338			624,353
Game and ride equipment	168,709			284,454
Furniture, fixtures and other equipment	108,510			230,986
Property leased under capital leases	16,183			28,228
	791,007			1,322,261
Less accumulated depreciation and amortization	(114,396		)	(641,559		)
Net property and equipment in service	676,611			680,702
Construction in progress	5,361			10,752
Property and equipment, net	$	681,972		$	691,454

Property leased under capital leases consists of buildings for our stores. Accumulated amortization related to these assets was $1.0 million and $10.4 million as of December 28, 2014 and December 29, 2013, respectively. Amortization of assets under capital leases is included in “Depreciation and amortization” in our Consolidated Statements of Earnings.

Total depreciation and amortization expense was $118.6 million, $9.9 million, $79.0 million, and $79.5 million for the 317 day period ended December 28, 2014, the 47 day period ended February 14, 2014, Fiscal 2013 and Fiscal 2012, respectively, of which, $2.7 million, $0.2 million, $0.8 million and $0.7 million, respectively, was included in “General and administrative expenses” in our Consolidated Statements of Earnings. Total depreciation and amortization expense for the 317 day period ended includes approximately $1.0 million related to the amortization of franchise agreements (see Note 7. “Goodwill and Intangible Assets, Net”).

Asset Impairments

In the 317 day period ended December 28, 2014, we recognized asset impairment charges of $0.4 million relating to four stores. There were no impairment charges recognized in the 47 day period ended February 14, 2014. In 2013, we recognized asset impairment charges of $3.1 million primarily relating to seven stores, three of which were previously impaired. In 2012, we recognized asset impairment charges of $6.8 million relating to 18 stores, seven of which were previously impaired. Of the stores impaired in 2014, 2013 and 2012, we continue to operate all but four. These impairment charges were the result of a decline in the stores’ financial performance, primarily due to various economic factors in the markets in which the stores are located. As of December 28, 2014 and December 29, 2013, respectively, the aggregate carrying value of the property and equipment at impaired stores, after the impairment charges, was $0.1 million for stores impaired in 2014 and $2.7 million for stores impaired in 2013.

Asset impairments represent adjustments we recognize to write down the carrying amount of the property and equipment at our stores to their estimated fair value, as the store’s operations are not expected to generate sufficient projected future cash flows to recover the current net book value of its long-lived assets. We estimate the fair value of a store’s long-lived assets (property and equipment) by discounting the expected future cash flows of the store using a weighted average cost of capital commensurate with the risk. Accordingly, the fair value measurement of the stores for which we recognized an impairment charge is classified within Level 3 of the fair value hierarchy. The following estimates and assumptions used in the discounted cash flow analysis impact the fair value of a store’s long-lived assets:


•	Discount rate based on our weighted average cost of capital and the risk-free rate of return;


•	Sales growth rates and cash flow margins;


•	Strategic plans, including projected capital spending and intent to exercise lease renewal options for the store;


•	Salvage values; and


•	Other risks and qualitative factors specific to the asset or market conditions in which the asset is located at the time the assessment was made.

During 2014, the average discount rate, average sales growth rate and average cash flow margin rate used were 8%, 0% and 0%, respectively. During 2013, the average discount rate, average sales growth rate and average cash flow margin used for impaired stores were 8%, 0% and 11%, respectively. We believe our assumptions in calculating the fair value of our long-lived assets are similar to those used by other marketplace participants. If actual results are not consistent with our estimates and assumptions, we may be exposed to additional impairment charges, which could be material to our Consolidated Statements of Earnings.