6. Leases

Leasing Arrangements as a Lessor

The Company’s leasing activities consist principally of leasing certain land and buildings as well as subleasing certain buildings to franchise operators. The land and building portions of all leases are classified as operating leases with lease terms expiring through August 2031. These leases include provisions for contingent rentals that may be received on the basis of a percentage of sales in excess of stipulated amounts. Income is not recognized on contingent rentals until sales exceed the stipulated amounts. Some leases contain escalation clauses over the lives of the leases. For property owned by third parties, the lease term runs concurrently with the term of the third-party lease arrangement. Most of the leases contain renewal options at the end of the initial term for periods of five years.

Future minimum rental payments receivable as of August 31, 2016, are as follows:



	Operating
Years ended August 31:
2017	$	7,738
2018		8,339
2019		8,890
2020		9,382
2021		8,990
Thereafter		50,709
	$	94,048

Leasing Arrangements as a Lessee

Certain Company Drive-Ins lease land and buildings from third parties. These leases, with lease terms expiring through August 2031, include provisions for contingent rents that may be paid on the basis of a percentage of sales in excess of stipulated amounts. For the majority of leases, the land portions are classified as operating leases, and the building portions are classified as capital leases.

Future minimum rental payments required under operating leases and maturities under capital leases that have initial or remaining noncancellable lease terms in excess of one year as of August 31, 2016, are as follows:



	Operating		Capital
Years ended August 31:
2017	$	10,914	$	5,051
2018		10,864		4,448
2019		10,840		3,596
2020		10,754		3,256
2021		10,030		3,134
Thereafter		63,733		7,018
Total minimum lease payments(1)	$	117,135		26,503
Less amount representing interest averaging 6.2%				(5,439)
Present value of net minimum lease payments				21,064
Less amount due within one year				(3,673)
Amount due after one year			$	17,391
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(1) Minimum payments have not been reduced by future minimum rentals receivable under noncancellable operating and capital subleases of $16.8 million and $0.6 million, respectively. They also do not include contingent rentals which may be due under certain leases. Contingent rentals for capital leases amounted to $0.9 million, $1.0 million and $0.8 million in fiscal years 2016, 2015 and 2014, respectively.

Total rent expense for all operating leases consists of the following for the years ended August 31:



	2016		2015		2014
Minimum rentals	$	12,441	$	12,659	$	12,449
Contingent rentals		284		174		161
Total rent expense		12,725		12,833		12,610
Less sublease rentals		(2,372)		(2,235)		(1,905)
Net rent expense	$	10,353	$	10,598	$	10,705