Research and Development Our principal research and development (R&D) activities during 2019, 2018 and 2017 focused on the expansion and integration of new products and releases, while expanding the product footprint of our software solution suites in Supply Chain, Inventory Optimization and Omnichannel including cloud-based solutions, point-of-sale and tablet retailing. For 2019, 2018 and 2017, we did not capitalize any R&D costs because the costs incurred following the attainment of technological feasibility for the related software product through the date of general release were insignificant. Our principal research and development (R&D) activities during 2019, 2018 and 2017 focused on the expansion and integration of new products and releases, while expanding the product footprint of our software solution suites in Supply Chain, Inventory Optimization and Omnichannel including cloud-based solutions, point-of-sale and tablet retailing. For 2019, 2018 and 2017, we did not capitalize any R&D costs because the costs incurred following the attainment of technological feasibility for the related software product through the date of general release were insignificant. Our principal research and development (R&D) activities during 2019, 2018 and 2017 focused on the expansion and integration of new products and releases, while expanding the product footprint of our software solution suites in Supply Chain, Inventory Optimization and Omnichannel including cloud-based solutions, point-of-sale and tablet retailing. For 2019, 2018 and 2017, we did not capitalize any R&D costs because the costs incurred following the attainment of technological feasibility for the related software product through the date of general release were insignificant.
Our principal research and development (R&D) activities during 2019, 2018 and 2017 focused on the expansion and integration of new products and releases, while expanding the product footprint of our software solution suites in Supply Chain, Inventory Optimization and Omnichannel including cloud-based solutions, point-of-sale and tablet retailing.
For 2019, 2018 and 2017, we did not capitalize any R&D costs because the costs incurred following the attainment of technological
feasibility for the related software product through the date of general release were insignificant.
Year 2019 compared with year 2018 R&D expenses primarily consist of salaries and other personnel-related costs for personnel involved in our research and development activities. Research and development expenses in 2019 increased by $15.7 million, or 22%, compared to 2018. This increase is primarily due to a $10.6 million increase in compensation and other personnel-related expenses, $3.0 million increase in performance-based compensation expense, and $1.7 million increase in computer infrastructure costs, resulting from increased headcount to support R&D activities.
Year 2018 compared with year 2017
Research and development expenses in 2018 increased by $14.2 million compared to 2017. The increase is primarily attributable to
an $8.9 million increase in compensation and other personnel-related expenses, resulting from increased headcount to support R&D
activities, a $4.0 million increase in performance-based compensation and a $0.7 million increase in computer infrastructure costs.
Sales and Marketing Year 2019 compared with year 2018 Sales and marketing expenses include salaries, commissions, travel and other personnel-related costs and the costs of our marketing and alliance programs and related activities. Sales and marketing expenses increased by $5.6 million, or 11%, in 2019 compared to 2018, primarily due to a $4.9 million increase in performance-based compensation expense and a $2.5 million increase in compensation and other personnel-related expenses, offset by a $1.9 million decrease in marketing related expenses. Year 2019 compared with year 2018 Sales and marketing expenses include salaries, commissions, travel and other personnel-related costs and the costs of our marketing and alliance programs and related activities. Sales and marketing expenses increased by $5.6 million, or 11%, in 2019 compared to 2018, primarily due to a $4.9 million increase in performance-based compensation expense and a $2.5 million increase in compensation and other personnel-related expenses, offset by a $1.9 million decrease in marketing related expenses.
Year 2018 compared with year 2017 Sales and marketing expenses increased $3.8 million in 2018 compared to 2017, due primarily to an increase of $2.9 million in marketing and campaign programs, a $1.1 million increase in performance-based compensation and a $0.7 million increase in compensation and other personnel-related expenses, partially offset by a $2.0 million decrease in commissions expense as we must defer a portion of our sales commission expense and amortize it over time as the corresponding services are transferred to the customer under ASC 606. Sales and marketing expenses increased $3.8 million in 2018 compared to 2017, due primarily to an increase of $2.9 million in marketing and campaign programs, a $1.1 million increase in performance-based compensation and a $0.7 million increase in compensation and other personnel-related expenses, partially offset by a $2.0 million decrease in commissions expense as we must defer a portion of our sales commission expense and amortize it over time as the corresponding services are transferred to the customer under ASC 606. Sales and marketing expenses increased $3.8 million in 2018 compared to 2017, due primarily to an increase of $2.9 million in marketing and campaign programs, a $1.1 million increase in performance-based compensation and a $0.7 million increase in compensation and other personnel-related expenses, partially offset by a $2.0 million decrease in commissions expense as we must defer a portion of our sales commission expense and amortize it over time as the corresponding services are transferred to the customer under ASC 606.
Sales and marketing expenses increased $3.8 million in 2018 compared to 2017, due primarily to an increase of $2.9 million in marketing and campaign programs, a $1.1 million increase in performance-based compensation and a $0.7 million increase in compensation and other personnel-related expenses, partially offset by a $2.0 million decrease in commissions expense as we must defer a portion of our sales commission expense and amortize it over time as the corresponding services are transferred to the customer under ASC 606.
General and Administrative Year 2019 compared with year 2018 General and administrative expenses consist primarily of salaries and other personnel-related costs of executive, financial, human resources, information technology, and administrative personnel, as well as facilities, legal, insurance, accounting, and other
Year 2019 compared with year 2018
General and administrative expenses consist primarily of salaries and other personnel-related costs of executive, financial, human resources, information technology, and administrative personnel, as well as facilities, legal, insurance, accounting, and other administrative expenses. General and administrative expenses increased $12.0 million, or 23%, in 2019 primarily attributable to a $8.9
million increase in compensation and other personnel-related expenses resulting from increased headcount, a $1.9 million increase in performance-based compensation expense, and a $1.1 million increase in computer infrastructure costs.
Year 2018 compared with year 2017 General and administrative expenses increased $6.6 million in 2018 due primarily to a $3.6 million increase in compensation and other personnel-related expenses and a $2.4 million increase in performance-based compensation.
Depreciation and Amortization Depreciation and amortization of intangibles and software expense amounted to $8.0 million, $8.6 million, and $9.1 million in 2019, 2018 and 2017, respectively. Amortization of intangibles was immaterial in 2019, 2018 and 2017. We have recorded goodwill and other acquisition-related intangible assets as part of the purchase accounting associated with various acquisitions.
Depreciation and amortization of intangibles and software expense amounted to $8.0 million, $8.6 million, and $9.1 million in 2019, 2018 and 2017, respectively. Amortization of intangibles was immaterial in 2019, 2018 and 2017. We have recorded goodwill and other acquisition-related intangible assets as part of the purchase accounting associated with various acquisitions.
Restructuring Charge In May 2017, we eliminated about 100 positions due primarily to U.S. retail sector headwinds, aligning services capacity with demand. We recorded a restructuring charge of approximately $2.9 million pretax ($1.8 million after-tax or $0.03 per fully diluted share). The charge primarily consisted of employee severance, employee transition costs and outplacement services. The charge is classified in “Restructuring charge” in our Consolidated Statements of Income.
In May 2017, we eliminated about 100 positions due primarily to U.S. retail sector headwinds, aligning services capacity with demand. We recorded a restructuring charge of approximately $2.9 million pretax ($1.8 million after-tax or $0.03 per fully diluted share). The charge primarily consisted of employee severance, employee transition costs and outplacement services. The charge is classified in “Restructuring charge” in our Consolidated Statements of Income.
Operating Income
Operating income in 2019 decreased $18.0 million to $115.9 million, compared to $133.9 million for 2018. Operating margins
were 18.8% for 2019 versus 23.9% for 2018. Operating income and margin decreased primarily due to our commitment to
strategically invest in a business transition to a cloud first company focused on delivering long-term sustainable growth and earnings
leverage. As a result, we are investing significantly in R&D to deliver new innovation, cloud operations headcount, infrastructure and
technology to support our ability to scale our cloud business to achieve our growth objectives. In addition, our innovation releases have fueled strong demand for our global consulting services and we are actively hiring to fulfill customer demand, which pressures operating income and margins until new resources ramp to full utilization. Finally, our performance-based compensation expense has increased over the prior year based on strong execution against target objectives. In 2019, operating income in the Americas segment decreased by $18.9 million and remained relatively flat in the EMEA and APAC segments.
Operating income in 2018 decreased $51.7 million to $133.9 million, compared to $185.6 million for 2017. Operating margins were 23.9% for 2018 versus 31.2% for 2017. Operating income and margin decreased primarily as a result of our investment in cloud transition combined with lower license revenue. The operating income decrease in the Americas, EMEA and APAC segments was
$39.1 million, $9.4 million and $3.2 million, respectively.

Year Ended December 31,       |           |           |           |                    |
----------------------------- | --------- | --------- | --------- | ------------------ | -----
                              |           |           |           | % Change vs. Prior |
Year                          | 2019      | 2018      | 2017      | 2019               | 2018
(in thousands)                |           |           |           |                    |
Research and development      | $ 87,608  | $ 71,896  | $ 57,704  | 22%                | 25%
Sales and marketing           | 56,860    | 51,262    | 47,482    | 11%                | 8%
General and administrative    | 64,603    | 52,618    | 46,054    | 23%                | 14%
Depreciation and amortization | 7,987     | 8,613     | 9,060     | -7%                | -5%
Restructuring charge          | -         | -         | 2,921     | NA                 | -100%
Operating expenses            | $ 217,058 | $ 184,389 | $ 163,221 | 18%                | 13%

Research Development principal activities 2019 2018 2017 focused expansion new products product footprint Supply Chain Inventory Optimization Omnichannel cloud-based point-of-sale tablet retailing. 2019 2018 2017 capitalize R&D costs costs technological feasibility insignificant. 2019 2018 2017 expansion new products product footprint Chain Omnichannel cloud-based point-of-sale tablet retailing. 2019, 2018 2017 capitalize R&D costs costs technological feasibility release insignificant. 2019 2018 2017 expansion new products product footprint Supply Chain Inventory Optimization Omnichannel cloud-based solutions point-of-sale tablet retailing. 2019 2017 capitalize R&D costs costs technological feasibility insignificant.
 2019 2018 2017 focused expansion integration new products product footprint Supply Chain Inventory Optimization Omnichannel cloud-based solutions point-of-sale tablet retailing.
 2019, 2018 2017 capitalize R&D costs costs technological
 feasibility release insignificant.
2019 2018 R&D expenses salaries personnel costs. increased $15. 7 million 22% 2018. due $10. 6 million compensation $3. million performance-based compensation $1. 7 million computer infrastructure costs increased headcount.
 2018
 expenses increased $14. 2 million 2017.
 $8. 9 million increase compensation expenses increased headcount
 $4. million performance-based compensation $0. 7 million computer infrastructure costs.
 Sales Marketing 2019 salaries commissions travel personnel marketing alliance programs. increased $5. 6 million 11% due $4. 9 million performance-based compensation $2. 5 million increase compensation expenses $1. 9 million marketing. salaries travel alliance programs. increased $5. 6 million 11% due $4. 9 million performance-based compensation $2. 5 million compensation $1. 9 million decrease marketing expenses.
 increased $3. 8 million due increase $2. 9 million marketing campaign programs $1. 1 million performance-based compensation.million increase compensation personnel expenses offset $2. million decrease commissions expense services ASC 606. Sales marketing expenses increased $3. 8 million 2018 2017 $2. 9 million marketing campaign programs $1. 1 million performance-based compensation $0. 7 million personnel expenses offset $2. million decrease commissions expense services ASC. Sales marketing expenses increased $3. 8 million 2018 2017 $2. 9 million marketing campaign $1. 1 million performance-based compensation $0. 7 million compensation personnel expenses offset $2. million decrease commissions expense.
 Sales marketing expenses increased $3. 8 million 2018 $2. 9 million marketing campaign $1. 1 million performance-based compensation $0. 7 million personnel expenses offset $2. million decrease commissions expense ASC 606.
 General Administrative Year 2019 2018 salaries personnel-related costs executive financial human resources information technology administrative personnel facilities legal insurance accounting
administrative expenses salaries costs executive financial resources technology facilities legal insurance accounting. increased $12. 0 million 23% 2019 $8. 9
 million compensation headcount $1. 9 million performance-based compensation $1. 1 million computer infrastructure costs.
 increased $6. 6 million $3. 6 million compensation $2. 4 million performance-based compensation.
 Depreciation Amortization $8. million $8. 6 million $9. 1 million 2019 2018 2017. immaterial.
 $8. million $8. 6 million $9. 1 million 2019 2017. Amortization immaterial 2017.
 Restructuring Charge 2017 eliminated 100 positions due. retail sector headwinds aligning capacity demand. restructuring charge $2. 9 million pretax ($1. 8 million after-tax $0. share. employee severance transition costs outplacement services. “Restructuring Consolidated Statements Income.
 May 2017 eliminated 100 positions due.sector aligning services capacity demand. recorded restructuring charge $2. 9 million pretax ($1. 8 million after-tax $0. 03 per diluted share. employee severance transition costs outplacement services. Consolidated Statements Income.
 2019 decreased $18. 0 million $115. 9 million $133. 9 million 2018. margins
 18. 8% 23. 2018.
 transition cloud growth
. investing R&D innovation cloud operations infrastructure
 technology. innovation releases demand consulting services hiring income margins. performance-based compensation expense increased. Americas decreased $18. 9 million flat EMEA APAC.
 2018 decreased $51. 7 million $133. 9 million $185. 6 million 2017. margins 23. 2018 31. 2% 2017. investment cloud transition lower license revenue. decrease Americas EMEA APAC segments
 $39. 1 million $9. 4 million $3. 2 million.
 Ended December
.

 Research development 87,608 71,896 57,704 22%
 Sales marketing 56,860 51,262 47,482
 General administrative 64,603 52,618 46,054 23%
 Depreciation amortization 7,987 8,613,060 -7%
 Restructuring charge 2,921
 Operating expenses $ 217,058 184,389 163,221


Product Warranties
The following table summarizes accrued warranty activities for fiscal 2019, 2018 and 2017:
In some cases, we may offer customers the option to purchase extended warranties to ensure protection beyond the standard warranty period. In those circumstances, the warranty is considered a distinct service and we account for the extended warranty as a performance obligation and allocate a portion of the transaction price to that performance obligation. More frequently, customers do not purchase a warranty separately. In those situations, we account for the warranty as an assurance-type warranty, which provides customers with assurance that the product complies with agreed-upon specifications, and this does not represent a separate performance obligation. Such warranties are recorded separately as liabilities and presented within ‘‘accrued liabilities’’ and ‘‘other long-term liabilities’’ on our consolidated balance sheets (see Note 5. Balance Sheet Components).

                                                 |                   | Fiscal Year Ended |
------------------------------------------------ | ----------------- | ----------------- | -----------------
(In thousands)                                   | December 29, 2019 | December 30, 2018 | December 31, 2017
Balance at the beginning of the period           | $172,266          | $181,303          | $161,209
Accruals for warranties issued during the period | 27,717            | 31,628            | 29,689
Settlements and adjustments during the period    | (61,538)          | (40,665)          | (9,595)
Balance at the end of the period                 | $138,445          | $172,266          | $181,303

Product Warranties
 table summarizes accrued warranty activities 2019 2018 2017:
 extended warranties beyond warranty period. distinct service performance obligation transaction price. warranty separately. assurance-type warranty specifications separate performance obligation. warranties recorded liabilities long-term consolidated balance sheets Note 5. Balance Sheet Components.
 Fiscal Year Ended
 December 29, 2019 30, 2018 December 31, 2017
 Balance $172,266 $181,303 $161,209
 Accruals warranties 27,717 31,628 29,689
 Settlements adjustments (61,538) (40,665) (9,595)
 Balance end $138,445 $172,266 $181,303


PREPAYMENTS, DEPOSITS AND OTHER ASSETS
Note: (a) As at 31 December 2019, the balances of loans to investees and investees’ shareholders are mainly repayable within a period of one to five years (included in non-current assets), or within one year (included in current assets), and are interest-bearing at rates of not higher than 12.0% per annum (31 December 2018: not higher than 12.0% per annum).
(b) Running royalty fees for online games comprised prepaid royalty fees, unamortised running royalty fees and deferred Online Service Fees.
As at 31 December 2019, the carrying amounts of deposits and other assets (excludes prepayments and refundable value-added tax) approximated their fair values. Deposits and other assets were neither past due nor impaired.

                                                          | As at 31 December |
--------------------------------------------------------- | ----------------- | -----------
                                                          | 2019              | 2018
                                                          | RMB’Million       | RMB’Million
Included in non-current assets:                           |                   |
Prepayments for media contents                            | 15,731            | 13,652
Loans to investees and investees’ shareholders (Note (a)) | 937               | 3,864
Prepayments for capital investments in investees          | 587               | 619
Running royalty fees for online games (Note (b))          | 564               | 99
Others                                                    | 5,623             | 3,297
                                                          | 23,442            | 21,531
Included in current assets:                               |                   |
Running royalty fees for online games (Note (b))          | 10,888            | 5,230
Prepayments and prepaid expenses                          | 8,353             | 7,532
Interest receivables                                      | 2,774             | 1,697
Lease deposits and other deposits                         | 1,107             | 693
Dividend and other investment-related receivables         | 1,034             | 338
Refundable value-added tax                                | 629               | 915
Loans to investees and investees’ shareholders (Note (a)) | 447               | 225
Others                                                    | 2,608             | 1,863
                                                          | 27,840            | 18,493
                                                          | 51,282            | 40,024

PREPAYMENTS DEPOSITS ASSETS
 31 December 2019 balances loans investees shareholders repayable one to five years year interest-bearing not 12. 0% per annum.
 royalty fees online games prepaid unamortised deferred Fees.
 amounts deposits assets prepayments refundable value-added tax approximated fair values. past due impaired.
 non-current assets
 Prepayments media contents 15,731 13,652
 Loans investees 937 3
 Prepayments capital investments 587
 Running royalty fees
 23,442 21,531
 current assets
 Running royalty fees online games 10,888 5,230
 Prepayments prepaid expenses 8,353 7,532
 Interest receivables 2,774
 Lease deposits
 Dividend investment-related receivables 1,034
 Refundable value-added tax 629
investees 447 225
 2,608 1,863
 27,840 18,493
 51,282


Equity Incentive Plan
On May 17, 2019, the Company’s stockholders approved the 2019 Omnibus Equity Incentive Plan (the “2019 Plan”). Concurrently, the 2011 Omnibus Equity Incentive Plan (the “2011 Plan”) was terminated and any shares remaining available for new grants under the 2011 Plan share reserve were extinguished. The purpose of the 2019 Plan is to promote the interests of the Company and its stockholders by (i) attracting and retaining key officers, employees and directors of, and consultants to, the Company and its Subsidiaries and Affiliates; (ii) motivating such individuals by means of performance-related incentives to achieve long-range performance goals; (iii) enabling such individuals to participate in the long-term growth and financial success of the Company; (iv) encouraging ownership of stock in the Company by such individuals; and (v) linking their compensation to the long-term interests of the Company and its stockholders.
The 2019 Plan is administered by the Compensation and Human Capital Committee (the “Committee”) of the Board of Directors and allows for the issuance of stock options, stock appreciation rights (“SARs”), RSAs, restricted share units, performance awards, or other stock-based awards. Stock option exercise prices are fixed by the Committee but shall not be less than the fair market value of a common share on the date of the grant of the option, except in the case of substitute awards. Similarly, the grant price of an SAR may not be less than the fair market value of a common share on the date of the grant. The Committee will determine the expiration date of each stock option and SAR, but in no case shall the stock option or SAR be exercisable after the expiration of 10 years from the date of the grant. The 2019 Plan provides for 2,600,000 shares available for grant. As of December 27, 2019, there were 2,222,088 shares available for grant.
Stock compensation expense was $4,399, $4,094 and $3,018 for the fiscal years ended December 27, 2019, December 28, 2018 and December 29, 2017, respectively. The related tax benefit for stock-based compensation was $883, $864 and $1,283 for the fiscal years ended December 27, 2019, December 28, 2018 and December 29, 2017, respectively.
The following table reflects the activity of RSAs during the fiscal years ended December 27, 2019 and December 28, 2018:
The fair value of RSAs vested during the fiscal years ended December 27, 2019, December 28, 2018 and December 29, 2017, was $3,742, $2,936 and $1,703, respectively.
These awards are a mix of time-, market- and performance-based grants awarded to key employees and non-employee directors which vest over a range of periods of up to five-years. The market- and performance-based RSAs cliff vest, if at all, after the conclusion of a three-year performance period and vesting is subject to the award recipient’s continued service to the Company as of the vesting date. The number of performance-based RSAs that ultimately vest is based on the Company’s attainment of certain profitability and return on invested capital targets.
During fiscal 2019, the Company awarded market-based RSAs that vest based on the Company’s attainment of an average closing trade price of the Company’s common stock of $39.86 per share, based on an average of 20 consecutive trading days. The grant date fair value of these market-based performance awards was determined using a Monte Carlo simulation in order to simulate a range of possible future stock prices. Key assumptions used included a risk-free interest rate of 2.2% and expected volatility of 44.6%.

                               | Shares    | Weighted Average Grant Date Fair Value
------------------------------ | --------- | --------------------------------------
Unvested at December 29, 2017  | 329,761   | $16.69
Granted                        | 311,957   | 23.62
Vested                         | (113,482) | 17.60
Forfeited                      | (1,506)   | 17.13
Unvested at December 28, 2018  | 526,730   | $20.60
Granted                        | 384,531   | 34.44
Vested                         | (115,459) | 21.32
Forfeited                      | (55,193)  | 20.46
Unvested at December 27, 2019  | 740,609   | $27.68

Equity Incentive Plan
 May 17, 2019 stockholders approved 2019 Omnibus Equity Incentive Plan. 2011 Omnibus Equity Incentive Plan terminated shares grants extinguished. 2019 Plan interests Company stockholders attracting retaining officers employees directors consultants motivating performance incentives growth financial success encouraging ownership stock linking compensation interests.
 2019 Plan administered Compensation Human Capital Committee Board allows issuance stock options stock appreciation rights restricted share units performance awards stock-based awards. Stock option prices fixed not less fair market value. grant price SAR less fair market. expiration date stock option SAR exercisable after 10 years. 2019 Plan provides 2,600,000 shares grant. December 27, 2019 2,222,088 shares available grant.
 Stock compensation expense $4,399 $4,094 $3,018 fiscal years December 27, 2019 28, 2018 29, 2017.tax benefit stock-based compensation $883 $864 $1,283 fiscal years 2019 2018 2017.
 table reflects activity RSAs
 fair value RSAs vested $3,742 $2,936 $1,703.
 awards time market performance-based grants employees directors vest five-years. market performance vest after three-year performance period service. performance-based RSAs profitability return invested capital targets.
 2019 awarded market-based average closing trade price common stock $39. 86 per share 20 consecutive trading days. grant fair value determined Monte Carlo simulation future stock prices. assumptions risk-free interest rate 2. 2% expected volatility 44. 6%.
 Average Grant Date
 Unvested December 29, 2017 329,761 $16. 69
 Granted 311,957. 62
 Vested. 60
.
 Unvested December 28, 2018 526,730 $20. 60
 Granted. 44
 Vested,459.
Forfeited,193).
 December 27, 2019,609.


Information About Our Executive Officers and Directors
Our executive officers are appointed by, and serve at the discretion of, our Board of Directors. There are no family relationships among our directors and officers.
The following table sets forth certain information concerning our current executive officers and directors as of March 13, 2020:
Brian C. Faith joined QuickLogic in June 1996. Mr. Faith has served as our President and Chief Executive Officer since June 2016 after having served as Vice President of Worldwide Marketing and Vice President of Worldwide Sales & Marketing between 2008 and 2016. Mr. Faith during the last 21 years has held a variety of managerial and executive leadership positions in engineering, product line management, marketing and sales. Mr. Faith has also served as the board member of the Global Semiconductor Alliance (GSA), the Chairman of the Marketing Committee for the CE-ATA Organization. He holds a B.S. degree in Computer Engineering from Santa Clara University and was an Adjunct Lecturer at Santa Clara University for Programmable Logic courses.
Suping (Sue) Cheung (Ph.D.) joined QuickLogic in May 2007. Dr. Cheung has served as our Chief Financial Officer, Vice President of Finance, Chief Accounting Officer, and Principal Accounting Officer since May 2015, Corporate Controller from 2007 to 2018. Prior to joining QuickLogic, Dr. Cheung was a Senior Manager of SEC Reporting, Technical Accounting and International Consolidation at Dell SonicWALL from 2006 to 2007 and was the Senior Accounting Manager at VeriFone System, Inc. from 2005 to 2006. Prior to 2005, Dr. Cheung held various senior accounting and financial management roles in both publicly traded and privately held companies. Dr. Cheung began her career with PricewaterhouseCoopers (PWC) where she served as an auditor and as a tax consultant. Dr. Cheung holds a Ph.D. in Business Administration and a Masters in Accounting from the Florida International University in Miami. She is a Certified Public Accountant.
Rajiv Jain joined QuickLogic in August 1992. Mr. Jain has served as our Vice President of Worldwide Operations since April 2014. Prior to this role, Mr. Jain served as QuickLogic’s Senior Director of Operations and Development Engineering from 2011 to 2014, Senior Director of System Solutions and Process Technology from 2009 to 2011, Director of Process Technology from 1997 to 2009, and Senior Process Technologist from 1992 to 1997. Prior to joining QuickLogic, Mr. Jain was a Senior Yield Engineer at National Semiconductor from 1991 to 1992, where he focused on BiCMOS product yield improvements, and at Monolithic Memories from 1985 to 1988, where he focused on BiPolar product yield and engineering wafer sort improvements. Mr. Jain holds a Master’s degree in Chemical Engineering from the University of California, Berkeley and a B.S. degree in Chemical Engineering from the University of Illinois, Champaign/Urbana.
Timothy Saxe (Ph.D.) joined QuickLogic in May 2001. Dr. Saxe has served as our Senior Vice President of Engineering and Chief Technology Officer since August 2016 and Senior Vice President and Chief Technology Officer since November 2008. Previously, Dr. Saxe has held a variety of executive leadership positions in QuickLogic including Vice President of Engineering and Vice President of Software Engineering. Dr. Saxe was Vice President of FLASH Engineering at Actel Corporation, a semiconductor manufacturing company, from November 2000 to February 2001. Dr. Saxe joined GateField Corporation, a design verification tools and services company formerly known as Zycad, in June 1983 and was a founder of their semiconductor manufacturing division in 1993. Dr. Saxe became GateField’s Chief Executive Officer in February 1999 and served in that capacity until Actel Corporation acquired GateField in November 2000. Dr. Saxe holds a B.S.E.E. degree from North Carolina State University, and an M.S.E.E. degree and a Ph.D. in Electrical Engineering from Stanford University.
Information regarding the backgrounds of our directors is set forth under the caption “Proposal One, Election of Directors” in our Proxy Statement, which information is incorporated herein by reference.

Name                  | Age | Position
--------------------- | --- | ---------------------------------------------------------------
Brian C. Faith        | 45  | President and Chief Executive Officer; Director
Suping (Sue) Cheung   | 56  | Chief Financial Officer and Vice President, Finance
Rajiv Jain            | 59  | Vice President, Worldwide Operations
Timothy Saxe          | 64  | Senior Vice President Engineering and Chief Technology  Officer
Michael R. Farese     | 73  | Chairman of the Board
Andrew J. Pease       | 69  | Director
Arturo Krueger        | 80  | Director
Daniel A. Rabinovitsj | 55  | Director
Christine Russell     | 69  | Director
Gary H. Tauss         | 65  | Director

Executive Officers
 Board Directors. no family relationships.
 March 13, 2020
 Brian. Faith joined QuickLogic June 1996. President Chief Executive Officer since June 2016 Vice President Marketing Sales 2008 2016. engineering product management marketing sales. board member Global Semiconductor Alliance Chairman Marketing Committee CE-ATA. B. S. Computer Engineering Santa Clara University Adjunct Lecturer Clara Programmable Logic.
 Cheung. joined QuickLogic May 2007. Chief Financial Officer Vice President Finance Chief Accounting Officer Principal Accounting Officer Corporate Controller 2007 2018. Senior Manager Dell SonicWALL Senior Accounting Manager VeriFone System. 2005 2006. senior accounting financial management roles publicly privately companies. PricewaterhouseCoopers auditor tax consultant. Ph. D. Business Administration Masters Accounting Florida International University. Certified Public Accountant.
 Rajiv Jain joined QuickLogic August 1992. Vice President Worldwide Operations since April 2014.Jain Senior Director Operations Development 2011 2014, System Solutions Process Technology 2009 2011, Process Technology 1997 2009, Senior Process Technologist 1992 1997. Senior Yield Engineer National Semiconductor 1991 1992 BiCMOS yield Monolithic Memories 1985 1988 BiPolar yield wafer. Master’s Chemical Engineering University California Berkeley B. S. Chemical Engineering University Illinois Champaign/Urbana.
 Timothy Saxe. joined QuickLogic May 2001. Senior Vice President Engineering Chief Technology Officer August 2016 President November 2008. Software Engineering Vice President FLASH Engineering Actel Corporation semiconductor November 2000 February 2001. GateField Corporation June 1983 founder semiconductor manufacturing division 1993. Chief Executive Officer February 1999 acquired November 2000. B. S. E. E North Carolina State University M. Ph. D. Electrical Engineering Stanford University.
 One Election Proxy Statement.
 Brian. President Chief Executive Officer
Cheung Chief Financial Officer Vice President
 Rajiv Jain Vice President Operations
 Timothy Saxe Senior Vice President Technology
. Farese Chairman
 Andrew. Pease
 Arturo Krueger
.
 Russell
 Gary. Tauss


3. Property, Plant and Equipment
Assets held under capital leases and included in property, plant and equipment as of September 28, 2019 and September 29, 2018 consisted of the following (in thousands):
Amortization of assets held under capital leases totaled $3.8 million, $3.4 million and $3.0 million for fiscal 2019, 2018 and 2017, respectively. Capital lease additions totaled $6.7 million, $11.8 million, and $20.5 million for fiscal 2019, 2018 and 2017, respectively.
As of September 28, 2019, September 29, 2018 and September 30, 2017, accounts payable included approximately $10.0 million, $11.2 million and $10.8 million, respectively, related to the purchase of property, plant and equipment, which have been treated as non-cash transactions for purposes of the Consolidated Statements of Cash Flows.

                                                                     | 2019    | 2018
-------------------------------------------------------------------- | ------- | -------
Buildings and improvements                                           | $23,717 | $23,717
Machinery and equipment                                              | 12,293  | 10,995
Capital assets in progress                                           | 11,831  | 7,747
Total property, plant and equipment held under capital leases, gross | 47,841  | 42,459
Less: accumulated amortization                                       | (8,762) | (6,123)
Total property, plant and equipment held under capital leases, net   | 39,079  | 36,336

. Property Plant Equipment
 capital leases September 28, 2019 29, 2018
 Amortization $3. 8 million $3. 4 million $3. 0 million. additions $6. 7 million $11. 8 million $20. 5 million.
 September 28, accounts payable $10. 0 million $11. 2 million $10. 8 million property plant equipment non-cash transactions Consolidated Statements Cash Flows.
 Buildings improvements $23,717
 Machinery equipment 12,293
 Capital assets 11,831 7,747
 47,841 42,459
 accumulated amortization (8,762)
 39,079 36,336


Cash Flows
The following table sets forth summary cash flow data for the periods indicated (in thousands).
Cash Flow from Operating Activities
Net cash flows provided by operating activities for the year ended December 31, 2019, were $137.6 million as compared to $183.9 million during the same period in 2018. Net cash provided by operating activities primarily consists of net income adjusted to add back depreciation, amortization, and stock-based compensation. Cash flows provided by operating activities were $46.3 million lower for the year ended December 31, 2019, compared to the same period in 2018, due to the timing of working capital. Our current policy is to use our operating cash flow primarily for funding capital expenditures, lease payments, stock repurchases, and acquisitions.
Cash Flow from Investing Activities
During the year ended December 31, 2019, we paid $753.9 million, net of $0.1 million in cash acquired, to acquire Speedpay. We also used cash of $18.5 million to invest in a payment technology and services company in India and $7.0 million to acquire the technology assets of RevChip, LLC and TranSend Integrated Technologies Inc. In addition, we used cash of $48.0 million to purchase software, property and equipment, as compared to $43.9 million during the same period in 2018.
Cash Flow from Financing Activities
Net cash flows provided by financing activities for the year ended December 31, 2019, were $667.2 million, as compared to net cash flows used by financing activities of $57.7 million during the same period in 2018. During 2019, we received proceeds of $500.0 million from our Delayed Draw Term Loan and $280.0 million from our Revolving Credit Facility to fund our purchase of Speedpay and stock repurchases, and we repaid $28.9 million on the Initial Term Loan and $41.0 million on the Revolving Credit Facility. In addition, we received proceeds of $16.6 million from the exercise of stock options and the issuance of common stock under our 2017 Employee Stock Purchase Plan, as amended, and used $4.0 million for the repurchase of stock-based compensation awards for tax withholdings. During 2019, we also used $35.6 million to repurchase common stock. During 2018, we received proceeds of $400.0 million from the issuance of the 2026 Notes. We used $300.0 million of the proceeds to redeem, in full, our outstanding 6.375% Senior Notes due 2020 and repaid $109.3 million on the Initial Term Loan. In addition, during 2018, we received proceeds of $22.8 million from the exercise of stock options and the issuance of common stock under our 2017 Employee Stock Purchase Plan, as amended, and used $2.6 million for the repurchase of restricted share awards ("RSAs") for tax withholdings. During 2018, we also used $54.5 million to repurchase common stock.

                                | Years Ended December 31, |
------------------------------- | ------------------------ | --------
                                | 2019                     | 2018
Net cash provided by (used in): |                          |
Operating activities            | $137,649                 | $183,932
Investing activities            | -830,481                 | -45,360
Financing activities            | 667,223                  | -57,704

Cash
 table cash flow data.
 Cash Flow Operating Activities
 2019 $137. 6 million $183. 9 million 2018. income depreciation amortization stock-based compensation. $46. 3 million lower due timing working capital. cash flow capital expenditures lease payments stock repurchases.
 Flow Investing Activities
 paid $753. 9 million $0. 1 million Speedpay. used $18. 5 million payment technology $7. million RevChip TranSend Integrated Technologies. $48. 0 million software property equipment $43. 9 million 2018.
 Financing Activities
 $667. 2 million $57. 7 million 2018. received proceeds $500. 0 million Delayed Draw Term Loan $280. million Revolving Credit Facility Speedpay stock repurchases repaid $28. 9 million Initial Term Loan $41. million Revolving Credit Facility. received proceeds $16. 6 million stock options common stock 2017 Employee Stock Purchase Plan used $4.repurchase stock compensation tax withholdings. $35. 6 million common stock. 2018 $400. million 2026 Notes. $300. million. 375% Senior Notes 2020 repaid $109. 3 million Initial Term Loan. $22. 8 million stock options common stock 2017 Employee Stock Purchase Plan $2. 6 million repurchase restricted share awards tax withholdings. $54. 5 million common stock.
 December
 cash
 Operating $137,649 $183,932
 Investing -830,481
 Financing,223


A non-employee director who is initially appointed after any annual meeting of stockholders will receive a restricted stock unit award or option grant on the date of his or her initial appointment to the Board of Directors equal to the pro-rated amount of the annual grant
Annual option grants and restricted stock unit awards (or any pro-rated grants for directors initially appointed between annual meetings) vest on the earlier to occur of the first anniversary of the date of grant or the next annual meeting of stockholders. No portion of an option automatically granted to a director is exercisable after the tenth anniversary after the date of option grant. Additionally, an option automatically granted to a director may be exercisable after the termination of the director’s services as described in the option agreement, generally ending three months after such termination.
The following table shows compensation information for our non-employee directors for fiscal year 2019.
2019 Director Compensation Table
(1) The amounts reflected in this column represent the aggregate grant date fair value for stock awards granted to our non-employee directors in 2019, measured in accordance with ASC 718, excluding the effect of estimated forfeitures, and do not reflect whether the recipient has actually realized a financial benefit from these awards. For the methodology of how the aggregate grant date fair value amount is calculated, please see Note 13 of the Notes to Consolidated Financial Statements included in this Form 10-K. The aggregate number of shares subject to unvested restricted stock unit awards outstanding for each non-employee director at December 31, 2019 was: Mr. Hill: 5,889; Ms. Antonellis: 5,889; Mr. Habiger: 5,889; Ms. Molina: 5,889; Mr. Riedel: 5,889 and Mr. Seams: 5,889. None of the non-employee directors held any stock options as of December 31, 2019.

Name                 | Fees Earned or Paid in Cash ($) | Stock Awards ($) | Option Awards ($) | Total($)
-------------------- | ------------------------------- | ---------------- | ----------------- | --------
Richard S. Hill      | $106,000                        | $149,987         | —                 | $255,987
Darcy Antonellis     | $55,333                         | $149,987         | —                 | $205,320
David C. Habiger     | $70,000                         | $149,987         | —                 | $219,987
V. Sue Molina        | $81,000                         | $149,987         | —                 | $230,987
George A. Riedel     | $68,333                         | $149,987         | —                 | $218,320
Christopher A. Seams | $82,000                         | $149,987         | —                 | $231,987

non-employee director appointed after annual meeting restricted stock unit award or option grant initial appointment equal-rated annual grant
 option grants awards vest first anniversary grant or next annual meeting. No option granted exercisable after tenth anniversary. option granted exercisable after termination services ending three months after termination.
 table shows compensation for non-employee directors fiscal year 2019.
 amounts represent grant date fair value stock awards ASC 718 excluding estimated forfeitures reflect financial benefit. see Note 13 Notes Consolidated Financial Statements Form 10-K. aggregate shares subject to unvested restricted stock unit awards for each non-employee director at December 31, 2019. Hill. Antonellis. Habiger. Molina. Riedel. Seams. None directors held stock options as of December 31, 2019.
 Name Fees Stock Awards Option Awards Total$
 Richard S.Hill $106,000 $149,987
 Antonellis $55,333 $205,320
. Habiger $70,000 $219
. Molina $81,000 $230
. Riedel $68,333 $218
. Seams $82,000 $231


Net Pension Expense
Net pension expense, as we define it below, includes the net periodic benefit costs related to both our pension and other postretirement plans. The net periodic benefit costs are determined annually based on beginning of year balances and are recorded ratably throughout the fiscal year, unless a significant re-measurement event occurs. The following is a summary of the net periodic benefit costs for the years ended June 30, 2019, 2018 and 2017:
In September 2016, we announced changes to retirement plans we offer to certain employees. Benefits accrued to eligible participants of our largest qualified defined benefit pension plan and certain non-qualified pension plans were frozen effective December 31, 2016. Approximately 1,900 affected employees were transitioned to the Company’s 401(k) plan that has been in effect for eligible employees since 2012, when the pension plan was closed to new entrants. We recognized the plan freeze during fiscal year 2017 as a curtailment, since it eliminated the accrual for a significant number of participants for all of their future services. We also made a voluntary pension contribution of $100.0 million to the affected plan in October 2016.
The service cost component of net pension expense represents the estimated cost of future pension liabilities earned associated with active employees. The pension earnings, interest and deferrals (“pension EID”) is comprised of the expected return on plan assets, interest costs on the projected benefit obligations of the plans and amortization of actuarial gains and losses and prior service costs.

                           |       | Years Ended June 30, |
-------------------------- | ----- | -------------------- | -----
($ in millions)            | 2019  | 2018                 | 2017
Pension plans              | $9.8  | $11.3                | $45.8
Other postretirement plans | 1.8   | 2.9                  | 2.6
Net periodic benefit costs | $11.6 | $14.2                | $48.4

Net Pension Expense
 includes benefit costs pension postretirement plans. determined annually recorded. summary costs years ended June 30 2019 2018
 September 2016, changes retirement plans. Benefits pension frozen December 31, 2016. 1,900 employees transitioned to 401(k) plan since 2012,. plan freeze 2017 curtailment eliminated accrual future services. voluntary pension contribution $100. 0 million plan October 2016.
 service cost estimated cost future pension liabilities. pension earnings interest deferrals expected return on plan assets interest costs projected benefit obligations amortization actuarial gains losses prior service costs.
 Years Ended June 30
 millions 2019 2018 2017
 Pension plans $9. $11. $45.
 Other postretirement plans.
 Net periodic benefit costs $11. 6 $14. $48.


Liquidity
The following table presents selected financial information on liquidity (in thousands):
(1) We define working capital as current assets less current liabilities. Fiscal year 2019 includes the impact of recognizing operating lease right-of-use assets and liabilities as a result of our adoption of Accounting Standards Codification Topic 842, “Leases,” as of December 29, 2018.
We believe our existing balances of cash and cash equivalents, working capital and the availability under our asset-based loan facility, are sufficient to satisfy our working capital needs, capital expenditures, debt service and other liquidity requirements associated with our current operations over the next 12 months.
Our capital expenditures, excluding cash paid for acquisitions, were approximately $16.1 million for fiscal 2019. We believe our capital expenditures, excluding cash paid for acquisitions, for fiscal 2020 will be approximately $38.0 million to $42.0 million. The increase in projected capital expenditures in fiscal 2020 as compared to fiscal 2019 is the result of planned expansions of several of our distribution facilities. Our planned capital projects will provide both new and expanded facilities and improvements to our technology that we believe will produce increased efficiency and the capacity to continue to support the growth of our customer base.

                                                        |                    | Fiscal Year Ended  |
------------------------------------------------------- | ------------------ | ------------------ | -----------------
                                                        | December 27, 2019  | December 28, 2018  | December 29, 2017
Cash and cash equivalents                               | $140,233           | $42,410            | $41,504
Working capital,(1) excluding cash and cash equivalents | $162,772           | $160,783           | $147,063
Availability under asset-based loan facility            | $133,359           | $90,015            | $64,805

Liquidity
 table information liquidity
 working capital assets less liabilities. Fiscal 2019 recognizing lease right-use assets liabilities Accounting Standards Codification Topic 842 29,.
 balances cash working capital-based loan capital needs expenditures debt service liquidity requirements next 12 months.
 capital expenditures $16. 1 million 2019. 2020 $38. 0 million to $42. 0 million. increase expenditures expansions distribution facilities. capital projects new facilities improvements efficiency growth customer base.
 Fiscal Year
 December 27, 2019 28, 2018 29, 2017
 Cash equivalents $140,233 $42,410 $41,504
 Working capital $162,772 $160,783 $147,063
 Availability asset-based loan facility $133,359 $90,015 $64,805


Operating lease commitments
The Group has entered into commercial leases on certain properties, network infrastructure, motor vehicles and items of equipment. The leases have various terms, escalation clauses, purchase options and renewal rights, none of which are individually significant to the Group
Future minimum lease payments under non-cancellable operating leases comprise:
The total of future minimum sublease payments expected to be received under non-cancellable subleases is €1,027 million (2018: €859 million).

                                                  | 2019   | 2018
------------------------------------------------- | ------ | -----
                                                  | €m     | €m
Within one year                                   | 2,834  | 2,686
In more than one year but less than two years     | 1,654  | 1,633
In more than two years but less than three years  | 1,227  | 1,155
In more than three years but less than four years | 950    | 903
In more than four years but less than five years  | 739    | 717
In more than five years                           | 3,412  | 2,600
                                                  | 10,816 | 9,694

lease commitments
 Group commercial leases properties infrastructure vehicles equipment. leases terms escalation clauses purchase options renewal rights significant
 Future lease payments non-cancellable
 total future sublease payments €1,027 million (2018 €859 million.
 2019
 one year 2,834 2,686
 two years 1,654 1,633
 three 1,227 1,155
 four years 950 903
 five years 739 717
 five years 2,600
 10,816 9,694


The following unaudited pro forma financial information is presented as if the acquisitions had taken place at the beginning of the periods presented and should not be taken as representative of the Company’s future consolidated results of operations. The following unaudited pro forma information includes adjustments for the amortization expense related to the identified intangible assets.
The following table summarizes the Company’s unaudited pro forma financial information is presented as if the acquisitions occurred on October 1, 2017 (amounts shown in thousands):
For the year ended September 30, 2018, revenue of $9.1 million and a net loss of $5.3 million related to the A2iA and ICAR businesses since the respective acquisition dates are included in the Company's consolidated statements of operations.

                            | For the years ended September 30, |
--------------------------- | --------------------------------- | ---------
                            | 2019                              | 2018
Pro forma revenue           | $86,206                           | $78,130
Pro forma net income (loss) | $889                              | $(12,268)

unaudited financial information acquisitions not future results. includes adjustments amortization expense intangible assets.
 table summarizes information acquisitions October 1, 2017
 year ended September 30, 2018 revenue $9. 1 million net loss $5. 3 million A2iA ICAR businesses consolidated statements operations.
 years ended September 30
 2019 2018
 revenue $86,206 $78,130
 net income (loss) $889 $(12,268)


4. PROPERTY AND EQUIPMENT, NET:
Property and equipment at September 2019 and September 2018 consisted of the following:

                                                | 2019         | 2018
----------------------------------------------- | ------------ | ------------
Land                                            | $773,068     | $773,068
Buildings and improvements                      | 12,574,893   | 12,206,908
Warehouse equipment                             | 15,011,605   | 13,424,236
Furniture, fixtures and leasehold improvements  | 13,155,606   | 12,018,984
Vehicles                                        | 3,687,901    | 3,229,551
Construction in progress                        | 617,881      | 743,278
                                                | 45,820,954   | 42,396,025
Less accumulated depreciation and amortization: | (28,165,539) | (26,627,541)
Owned property and equipment                    | $ 17,655,415 | $ 15,768,484

. PROPERTY
 Land $773,068
 Buildings 12,574,893 12,206,908
 15,011,605 13,424,236
 Furniture 13,155,606 12,018,984
 Vehicles 3,687,901 3,229,551
 Construction
 45,820,954 42,396,025
 depreciation amortization (28,165,539 (26,627,541)
 17,655,415 15,768,484


(d) Product Warranties
The following table summarizes the activity related to the product warranty liability (in millions):
We accrue for warranty costs as part of our cost of sales based on associated material product costs, labor costs for technical support staff, and associated overhead. Our products are generally covered by a warranty for periods ranging from 90 days to five years, and for some products we provide a limited lifetime warranty.

                                        | July 27, 2019 | July 28, 2018 | July 29, 2017
--------------------------------------- | ------------- | ------------- | -------------
Balance at beginning of fiscal year     | $359          | $407          | $414
Provisions for warranties issued        | 600           | 582           | 691
Adjustments for pre-existing warranties | (12)          | (38)          | (21)
Settlements                             | (603)         | (592)         | (677)
Acquisitions and divestitures           | (2)           | —             | —
Balance at end of fiscal year           | $342          | $359          | $407

Product Warranties
 table warranty liability
 accrue warranty costs. products 90 days to five years limited lifetime warranty.
 July 2019 28, 2018 29, 2017
 Balance fiscal year $359 $407 $414
 Provisions warranties 600 582 691
 Adjustments pre-existing warranties (12)
 Settlements (603) (592) (677)
 Acquisitions divestitures
 Balance end fiscal year $342 $359 $407


The following table provides reconciliation from U.S. GAAP Operating income to non-GAAP Adjusted operating income (amounts in thousands):
(1) Fiscal years ending March 31, 2018 and 2017 adjusted due to the adoption of ASC 606.
(2) $0.9 million in costs incurred during fiscal year 2018 related to the relocation of the Company's tantalum powder facility equipment from Carson City, Nevada to its existing Matamoros, Mexico plant were reclassified from “Plant start-up costs” to “Restructuring charges” during fiscal year 2019.

                                                            |          | Fiscal Years Ended March 31, |
----------------------------------------------------------- | -------- | ---------------------------- | -------
                                                            | 2019     | 2018                         | 2017
Operating income (GAAP) (1)                                 | $200,849 | $112,852                     | $34,968
Non-GAAP adjustments:                                       |          |                              |
(Gain) loss on write down and disposal of long-lived assets | 1,660    | (992)                        | 10,671
ERP integration costs/IT transition costs                   | 8,813    | 80                           | 7,045
Stock-based compensation                                    | 12,866   | 7,657                        | 4,720
Restructuring charges (2)                                   | 8,779    | 14,843                       | 5,404
Legal expenses related to antitrust class actions           | 5,195    | 6,736                        | 2,640
TOKIN investment-related expenses                           | —        | —                            | 1,101
Plant start-up costs (2)                                    | (927)    | 929                          | 427
Adjusted operating income (non-GAAP) (1)                    | $237,235 | $142,105                     | $66,976

table. GAAP non-GAAP
 Fiscal years 2018 2017 adjusted ASC 606.
. 9 million costs relocation tantalum powder equipment Carson City Nevada Matamoros Mexico reclassified start-up 2019.
 Fiscal Years Ended March
 2017
 Operating income (GAAP) $200,849 $112,852 $34,968
 Non-GAAP adjustments
 loss write down disposal long-lived assets 1,660 10
 ERP transition costs 8
 Stock-based compensation 12,866
 Restructuring charges 8,779
 Legal expenses antitrust class actions
 investment-related expenses
 Plant start-up costs
 Adjusted operating income-GAAP $237,235 $142,105 $66,976


Refranchisings and franchisee development — The following table summarizes the number of restaurants sold to franchisees, the number of restaurants developed by franchisees, and gains recognized in each fiscal year (dollars in thousands):
(1) Amounts in 2019, 2018, and 2017 include additional proceeds of $1.3 million, $1.4 million, and $0.2 million related to the extension of the underlying franchise and lease agreements from the sale of restaurants in prior years.
(2)  Charges are for operating restaurant leases with lease commitments in excess of our sublease rental income.
(3) Amounts in 2018 primarily represent $9.2 million of costs related to franchise remodel incentives, $8.7 million reduction of gains related to the modification of certain 2017 refranchising transactions, $2.3 million of maintenance and repair expenses and $3.7 million of other miscellaneous non-capital charges. Amounts in 2017 represent impairment of $4.6 million and equipment write-offs of $1.4 million related to restaurants closed in connection with the sale of the related markets, maintenance and repair charges, and other miscellaneous non-capital charges.
Franchise acquisitions — In 2019 and 2018 we did not acquire any franchise restaurants. In 2017 we acquired 50 franchise restaurants. Of the 50 restaurants acquired, we took over 31 restaurants as a result of an agreement with an underperforming franchisee who was in violation of franchise and lease agreements with the Company. Under this agreement, the franchisee voluntarily agreed to turn over the restaurants. The acquisition of the additional 19 restaurants in 2017 was the result of a legal action filed in September 2013 against a franchisee, from which legal action we obtained a judgment in January 2017 granting us possession of the restaurants. Of the 50 restaurants acquired in 2017, we closed eight and sold 42 to franchisees.

                                                             | 2019   | 2018      | 2017
------------------------------------------------------------ | ------ | --------- | ---------
Restaurants sold to franchisees                              | —      | 135       | 178
New restaurants opened by franchisees                        | 19     | 11        | 18
Proceeds from the sale of company-operated restaurants:      |        |           |
Cash (1)                                                     | $1,280 | $26,486   | $99,591
Notes receivable                                             | —      | 70,461    | —
                                                             | $1,280 | $96,947   | $99,591
                                                             |        |           |
Net assets sold (primarily property and equipment)           | $—     | $(21,329) | $(30,597)
Lease commitment charges (2)                                 | —      | —         | (11,737)
Goodwill related to the sale of company-operated restaurants | (2)    | (4,663)   | (10,062)
Other (3)                                                    | 88     | (24,791)  | (9,161)
Gains on the sale of company-operated restaurants            | $1,366 | $46,164   | $38,034

Refranchisings franchisee development table summarizes restaurants sold developed gains each fiscal year
 2019 2018 2017 include proceeds $1. 3 million $1. 4 million $0. 2 million extension franchise lease agreements sale.
 Charges for operating restaurant leases sublease rental income.
 2018 represent $9. 2 million costs franchise remodel incentives $8. 7 million reduction gains 2017 $2. 3 million maintenance repair expenses $3. 7 million miscellaneous non-capital charges. 2017 impairment $4. 6 million equipment write-offs $1. 4 million restaurants closed maintenance repair charges-capital charges.
 Franchise acquisitions 2019 2018. 2017 acquired 50 restaurants. took 31 agreement underperforming franchisee. acquisition additional 19 restaurants 2017 legal action 2013 judgment 2017 possession. closed eight sold 42 franchisees.
 Restaurants sold
 New restaurants opened franchisees
 Proceeds from sale company-operated restaurants
Cash $1,280 $26,486 $99,591
 Notes receivable
 $96,947
 assets property equipment(21,329) $(30,597)
 Lease charges (11,737
 Goodwill restaurants (4,663) (10,062)
 (24,791) (9,161
 Gains $1,366 $46,164 $38,034


15. Trade and other payables
Trade and other payables mainly consist of amounts owed to suppliers that have been invoiced or are accrued and contract liabilities relating to consideration received from customers in advance. They also include taxes and social security amounts due in relation to the Group’s role as an employer. Derivative financial instruments with a negative market value are reported within this note.
Accounting policies
Trade payables are not interest-bearing and are stated at their nominal value.
Notes: 1 Previously described as deferred income in the year ended 31 March 2018
2 Items are measured at fair value and the valuation basis is level 2 classification, which comprises items where fair value is determined from inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly
3 Includes €823 million (2018: €nil) payable in relation to the irrevocable and non-discretionary share buyback programme announced in January 2019.
The carrying amounts of trade and other payables approximate their fair value.
Materially all of the €1,716 million recorded as current contract liabilities at 1 April 2018 was recognised as revenue during the year.
Other payables included within non-current liabilities include €288 million (2018: €271 million) in respect of the re-insurance of a third party annuity policy related to the Vodafone and CWW Sections of the Vodafone UK Group Pension Scheme.
The fair values of the derivative financial instruments are calculated by discounting the future cash flows to net present values using appropriate market interest rates and foreign currency rates prevailing at 31 March.

                                              | 2019   | 2018
--------------------------------------------- | ------ | ------
                                              | €m     | €m
Included within non-current liabilities:      |        |
Other payables                                | 327    | 314
Accruals                                      | 113    | 159
Contract liabilities1                         | 574    | 237
Derivative financial instruments2             | 1,924  | 2,133
                                              | 2,938  | 2,843
Included within current liabilities:          |        |
Trade payables                                | 6,541  | 6,185
Amounts owed to associates and joint ventures | 26     | 27
Other taxes and social security payable       | 1,218  | 1,177
Other payables3                               | 1,410  | 1,346
Accruals                                      | 6,120  | 5,579
Contract liabilities1                         | 1,818  | 1,678
Derivative financial instruments2             | 520    | 250
                                              | 17,653 | 16,242

. Trade payables
 owed suppliers invoiced contract liabilities. taxes social security employer. Derivative financial instruments negative market value reported.
 payables not interest-bearing stated nominal value.
 deferred income 31 March 2018
 Items measured fair value level 2 classification
 Includes €823 million (2018 €nil) irrevocable non share buyback programme January 2019.
 carrying amounts approximate fair value.
 €1,716 million current contract liabilities 1 April 2018 recognised revenue.
 non €288 million (2018 €271 million re-insurance third party annuity policy Vodafone UK Group Pension Scheme.
 fair values derivative financial instruments calculated future cash flows present values market interest rates foreign currency rates 31 March.
 non-current liabilities
 Other payables 327
 Accruals
 Contract liabilities1
 Derivative financial 1,924
 current liabilities
6,541,185
 associates
 taxes security 1,218 1,177
 1,410 1,346
 Accruals 6,120 5,579
 Contract 1,818 1,678
 520
 17,653


5. Creditors
Accounting policies
Capital market and bank borrowings
Interest-bearing loans and overdrafts are initially measured at fair value (which is equal to cost at inception) and are subsequently measured at amortised cost using the effective interest rate method, except where they are identified as a hedged item in a designated hedge relationship. Any difference between the proceeds net of transaction costs and the amount due on settlement or redemption of borrowings is recognised over the term of the borrowing
Notes: 1 Amounts owed to subsidiaries are unsecured, have no fixed date of repayment and are repayable on demand.
Included in amounts falling due after more than one year are other loans of €31,157 million which are due in more than five years from 1 April 2019 and are payable otherwise than by instalments. Interest payable on these loans ranges from 0.375% to 7.875%.
Details of bond and other debt issuances are set out in note 20 “Borrowing and capital resources” in the consolidated financial statements

                                              | 2019    | 2018
--------------------------------------------- | ------- | -------
                                              | €m      | €m
Amounts falling due within one year:          |         |
Bank loans and other loans                    | 4,835   | 8,367
Amounts owed to subsidiaries1                 | 232,896 | 220,625
Derivative financial instruments              | 463     | 229
Taxation payable                              | –       | 9
Other creditors                               | 945     | 120
Accruals and deferred income                  | 66      | 46
                                              | 239,205 | 229,396
Amounts falling due after more than one year: |         |
Deferred tax                                  | 17      | –
Other loans                                   | 46,208  | 32,199
Derivative financial instruments              | 1,924   | 2,133
                                              | 48,149  | 34,332

. Creditors
 Accounting policies
 Capital market bank borrowings
 Interest-bearing loans overdrafts measured fair value amortised cost interest rate hedged item. difference transaction costs due settlement redemption recognised term borrowing
 Amounts owed subsidiaries unsecured no fixed date repayable demand.
 year loans €31,157 million due five years 1 April 2019 payable. Interest 0. 375% to 7. 875%.
 bond debt issuances note 20 capital consolidated financial statements
 Amounts due one year
 Bank loans loans 4,835 8,367
 owed 232,896 220,625
 financial instruments
 Taxation
 creditors
 Accruals deferred income
,205
 Amounts after one year
 Deferred tax
 Other loans 46,208 32,199
 financial instruments


3. VOYAGE REVENUES
Our voyage revenues consist of time charter revenues and spot charter revenues with the following split:
*Spot charter revenues for 2019 and 2018 are presented in accordance we ASC 606 Revenue from Contracts with Customers. The comparative information for 2017 has not been restated.

All amounts in USD ‘000  | 2019    | 2018    | 2017
------------------------ | ------- | ------- | -------
Spot charter revenues*   | 283,007 | 259,978 | 257,495
Time charter revenues    | 34,213  | 29,038  | 39,646
Total Voyage Revenues    | 317,220 | 289,016 | 297,141

. VOYAGE REVENUES
 time spot
 charter 2019 2018 ASC 606. comparative information 2017.
 amounts USD 2019 2018
 Spot charter 283,007 259,978 257,495
 Time charter 34,213 29,038 39,646
 Total Voyage 317,220,016,141


Hardware Business
Our hardware business’ revenues are generated from the sales of our Oracle Engineered Systems, server, storage, and industry-specific hardware products. Each hardware product and its related software, such as an operating system or firmware, are highly interdependent and interrelated and are accounted for as a combined performance obligation. The revenues for this combined performance obligation are generally recognized at the point in time that the hardware product and its related software are delivered to the customer and ownership is transferred to the customer. Our hardware business also earns revenues from the sale of hardware support contracts purchased and renewed by our customers at their option and are generally recognized as revenues ratably as the hardware support services are delivered over the contractual term, which is generally one year. The majority of our hardware products are sold through indirect channels such as independent distributors and value-added resellers, and we also market and sell our hardware products through our direct sales force. Operating expenses associated with our hardware business include the cost of hardware products, which consists of expenses for materials and labor used to produce these products by our internal manufacturing operations or by third-party manufacturers, warranty expenses and the impact of periodic changes in inventory valuation, including the impact of inventory determined to be excess and obsolete; the cost of materials used to repair customer products; the cost of labor and infrastructure to provide support services; and sales and marketing expenses, which are largely personnel related and include variable compensation earned by our sales force for the sales of our hardware offerings.
1 ) Excludes stock-based compensation and certain expense allocations. Also excludes amortization of intangible assets and certain other GAAP-based expenses, which were not allocated to our operating segment results for purposes of reporting to and review by our CODMs, as further described under “Presentation of Operating Segments and Other Financial Information” above.
Excluding the effects of currency rate fluctuations, total hardware revenues decreased in fiscal 2019 relative to fiscal 2018 due to lower hardware products revenues and, to a lesser extent, lower hardware support revenues. The decrease in hardware products revenues in fiscal 2019 relative to fiscal 2018 was primarily attributable to our continued emphasis on the marketing and sale of our cloud-based infrastructure technologies, which resulted in reduced sales volumes of certain of our hardware product lines and also impacted the volume of hardware support contracts sold in recent periods. This constant currency hardware revenue decrease was partially offset by certain hardware revenue increases related to our Oracle Engineered Systems offerings, primarily Oracle Exadata.
Excluding the effects of currency rate fluctuations, total hardware expenses decreased in fiscal 2019 compared to fiscal 2018 primarily due to lower hardware products and support costs and lower sales and marketing employee related expenses, all of which aligned to lower hardware revenues.
In constant currency, total margin and total margin as a percentage of revenues for our hardware segment increased in fiscal 2019 due to lower expenses.

                                  |        |        | Year Ended May 31, |
--------------------------------- | ------ | ------ | ------------------ | ------
                                  |        |        | Percent Change     |
(Dollars in millions)             | 2019   | Actual | Constant           | 2018
Hardware Revenues:                |        |        |                    |
Americas                          | $1,889 | -6%    | -4%                | $2,003
EMEA                              | 1,082  | -10%   | -5%                | 1,201
Asia Pacific                      | 733    | -7%    | -4%                | 790
Total revenues                    | 3,704  | -7%    | -5%                | 3,994
Expenses:                         |        |        |                    |
Hardware products and support (1) | 1,327  | -14%   | -11%               | 1,547
Sales and marketing (1)           | 520    | -19%   | -16%               | 643
Total expenses (1)                | 1,847  | -16%   | -13%               | 2,190
Total Margin                      | $1,857 | 3%     | 6%                 | $1,804
Total Margin %                    | 50%    |        |                    | 45%
% Revenues by Geography:          |        |        |                    |
Americas                          | 51%    |        |                    | 50%
EMEA                              | 29%    |        |                    | 30%
Asia Pacific                      | 20%    |        |                    | 20%

Hardware Business
 revenues from sales Oracle Engineered Systems server storage industry-specific hardware products. Each product related software interdependent accounted for as combined performance obligation. revenues recognized at hardware product software delivered to customer ownership transferred. earns revenues from hardware support contracts recognized as revenues delivered over contractual term one year. majority hardware products sold through indirect independent distributors value-added resellers through direct sales force. Operating expenses include cost of hardware products for materials labor warranty expenses changes inventory valuation materials products labor infrastructure support services sales marketing expenses personnel related variable compensation sales force for.
 Excludes stock-based compensation expense allocations. excludes amortization of intangible assets other GAAP-based expenses not allocated to results.
 Excluding fluctuations total hardware revenues decreased in fiscal 2019 2018 due to lower hardware products revenues hardware support revenues.decrease hardware revenues 2019 attributable cloud-based infrastructure technologies reduced sales volumes support contracts. decrease offset by increases Oracle Engineered Systems offerings Exadata.
 hardware expenses decreased 2019 due lower hardware products support costs sales marketing expenses revenues.
 total margin hardware increased 2019 lower expenses.
 Ended May 31,
 Percent Change
 2019
 Hardware Revenues
 Americas $1,889 -6% -4% $2,003
 EMEA 1,082 -10% -5% 1,201
 Asia Pacific 733 -7% -4%
 Total revenues 3,704 -7% -5% 3,994
 Expenses
 Hardware products support 1,327 -14% -11% 1,547
 Sales marketing 520 -19% -16%
 Total expenses 1,847 -16% 2,190
 Total Margin $1,857 3% $1,804
 Margin %
 Revenues Geography
 Americas 51%
29% 30%
 Asia Pacific 20%


Liquidity
Cash and Liquidity. As of December 31, 2019, our principal sources of liquidity included cash, cash equivalents, and short-term investments of $182.7 million, compared to $162.9 million as of December 31, 2018. We generally invest our excess cash balances in low-risk, short-term investments to limit our exposure to market and credit risks.
During the first quarter of 2018, we refinanced our 2015 Credit Agreement which extended the term of the loan to March 2023 as well as obtained a reduction in the interest rate and other fees. The 2018 Credit Agreement increased our liquidity and capital resources position by approximately $30 million.
As part of our 2018 Credit Agreement, we have a $200 million senior secured revolving loan facility with a syndicate of financial institutions that expires in March 2023. As of December 31, 2019, there were no borrowings outstanding on the 2018 Revolver. The 2018 Credit Agreement contains customary affirmative covenants and financial covenants. As of December 31, 2019, and the date of this filing, we believe that we are in compliance with the provisions of the 2018 Credit Agreement.
Our cash, cash equivalents, and short-term investment balances as of the end of the indicated periods were located in the following geographical regions (in thousands):
We generally have ready access to substantially all of our cash, cash equivalents, and short-term investment balances, but may face limitations on moving cash out of certain foreign jurisdictions due to currency controls and potential negative economic consequences. As of December 31, 2019, we had $2.7 million of cash restricted as to use to collateralize outstanding letters of credit.
Cash Flows From Operating Activities. We calculate our cash flows from operating activities beginning with net income, adding back the impact of non-cash items or nonoperating activity (e.g., depreciation, amortization, amortization of OID, impairments, gain/loss from debt extinguishments, deferred income taxes, stock-based compensation, etc.), and then factoring in the impact of changes in operating assets and liabilities.
Our primary source of cash is from our operating activities. Our current business model consists of a significant amount of recurring revenue sources related to our long-term cloud-based and managed services arrangements (mostly billed monthly), payment process transaction services (mostly billed monthly), and software maintenance agreements (billed monthly, quarterly, or annually). This recurring revenue base provides us with a reliable and predictable source of cash. In addition, software license fees and professional services revenues are sources of cash, but the payment streams for these items are less predictable.
The primary use of our cash is to fund our operating activities. Over half of our total operating costs relate to labor costs (both employees and contracted labor) for the following: (i) compensation; (ii) related fringe benefits; and (iii) reimbursements for travel and entertainment expenses. The other primary cash requirements for our operating expenses consist of: (i) computing capacity and related services and communication lines for our outsourced cloud-based business; (ii) paper, envelopes, and related supplies for our statement processing solutions; (iii) transaction fees paid in conjunction with the delivery of services under our payment services contracts; (iv) hardware and software; and (v) rent and related facility costs. These items are purchased under a variety of both short-term and long-term contractual commitments. A summary of our material contractual obligations is provided below.

                                                        | December 31, | December 31,
------------------------------------------------------- | ------------ | ------------
                                                        | 2019         | 2018
Americas (principally the U.S.)                         | $125,309     | $110,385
Europe, Middle East and Africa                          | 50,477       | 45,884
Asia Pacific                                            | 6,871        | 6,611
Total cash, cash equivalents and short-term investments | $182,657     | $162,880

. December 31, 2019 principal sources cash equivalents short-term investments $182. 7 million compared $162. 9 million 2018. excess cash in low-risk short-term investments limit market credit risks.
 refinanced 2015 Credit Agreement extended loan to March 2023 obtained reduction interest rate fees. 2018 Credit Agreement increased liquidity capital resources $30 million.
 $200 million senior secured revolving loan expires March 2023. December 31, 2019 no borrowings outstanding. Agreement affirmative covenants financial covenants. compliance provisions Credit Agreement.
 cash equivalents short-term investment balances regions
 ready access cash balances limitations cash foreign jurisdictions currency controls negative economic consequences. December 31, 2019 $2. 7 million cash restricted collateralize letters credit.
 Cash Flows Operating Activities. calculate cash flows net income impact non-cash items. operating assets liabilities.
 primary source cash from operating activities.business model recurring revenue cloud managed services payment process transaction services software maintenance. recurring revenue reliable predictable source cash. software license fees professional services revenues cash payment less predictable.
 primary cash operating activities. half operating costs labor costs compensation fringe benefits travel entertainment expenses. cash requirements computing capacity communication lines cloud paper envelopes supplies statement processing transaction fees hardware software rent facility costs. purchased under short-term long-term contractual commitments. summary contractual obligations below.
 2019 2018
 Americas. $125,309  $110,385
 Europe Middle East Africa 50,477 45,884
 Asia Pacific 6,871 6,611
 Total cash equivalents short-term investments $182,657  $162,880


The following table reconciles our historical consolidated EBITDA and Adjusted EBITDA to net (loss) income.
(a) Foreign currency exchange loss (gain) includes the unrealized loss of $13.2 million in 2019 (2018 – gain of $21.2 million, 2017 – gain of $82.7 million, 2016 – gain of $75.0 million, and 2015 – loss of $89.2 million) on cross currency swaps.
(b) In June 2016, as part of its financing initiatives, Altera canceled the construction contracts for its two UMS newbuildings. As a result, Altera accrued for potential damages resulting from the cancellations and reversed contingent liabilities previously recorded that were relating to the delivery of the UMS newbuildings.
This net loss provision of $23.4 million for the year ended December 31, 2016 was reported in other loss in our consolidated statement of income. The newbuilding contracts were held in Altera's separate subsidiaries and obligations of these subsidiaries were non-recourse to Altera.
(c) During the year ended December 31, 2016, the Company recorded a write-down of a cost-accounted investment of $19.0 million. This investment was subsequently sold in 2017, resulting in a gain on sale of $1.3 million. During 2017, the Company recognized an additional tax indemnification guarantee liability of $50 million related to the Teekay Nakilat finance leases. For additional information, please read "Item 18 – Financial Statements: Note 15 – Other loss".
(d) Adjustments related to equity (loss) income is a non-GAAP financial measure and should not be considered as an alternative to equity income or any other measure of financial performance or liquidity presented in accordance with GAAP. Adjustments related to equity (loss) income exclude some, but not all, items that affect equity (loss) income, and these measures may vary among other companies. Therefore, adjustments related to equity (loss) income as presented in this Annual Report may not be comparable to similarly titled measures of other companies.
Adjustments related to equity (loss) income includes depreciation and amortization, net interest expense, income tax expense (recovery), amortization of in-process revenue contracts, direct finance and salestype lease payments received in excess of revenue recognized, write-down and loss (gain) on sales of vessels, realized and unrealized loss (gain) on derivative instruments and other items, realized loss (gain) on foreign currency forward contracts,
and write-down and gain on sale of equity-accounted investments, in each case related to our equity-accounted entities, on the basis of our ownership percentages of such entities.

                                                                                |            |           | Year Ended December 31,        |           |
------------------------------------------------------------------------------------ | ---------- | --------- | ------------------------------ | --------- | ---------
                                                                                | 2019       | 2018      | 2017                           | 2016      | 2015
Income Statement Data:                                                               |            |           | (in thousands of U.S. Dollars) |           |
Reconciliation of EBITDA and Adjusted EBITDA to Net (loss) income                    |            |           |                                |           |
Net (loss) income                                                                    | $(148,986) | $(57,747) | $(529,072)                     | $86,664   | $405,460
Income tax expense (recovery)                                                        | 25,482     | 19,724    | 12,232                         | 24,468    | (16,767)
Depreciation and amortization                                                        | 290,672    | 276,307   | 485,829                        | 571,825   | 509,500
Interest expense, net of interest income                                             | 271,255    | 245,601   | 262,110                        | 278,145   | 236,481
EBITDA                                                                               | 438,423    | 483,885   | 231,099                        | 961,102   | 1,134,674
Foreign exchange loss (gain) (a)                                                     | 13,574     | (6,140)   | 26,463                         | 6,548     | 2,195
Other loss (income) (b) (c)                                                          | 14,475     | 2,013     | 53,981                         | 39,013    | (1,566)
Write-down and loss on sale of vessels                                               | 170,310    | 53,693    | 270,743                        | 112,246   | 70,175
Direct finance lease payments received in excess of revenue recognized               | 21,636     | 11,082    | 18,737                         | 28,348    | 24,429
Amortization of in-process revenue contracts and other                               | (4,131)    | (10,217)  | (13,460)                       | (24,195)  | (33,226)
Realized and unrealized losses on non-designated derivative instruments              | 13,719     | 14,852    | 38,854                         | 35,091    | 102,200
Realized gains (losses) from the settlements of nondesignated derivative instruments | 1,532      | —         | 2,047                          | (8,646)   | (20,008)
Loss on deconsolidation of Altera                                                    | —          | 7,070     | 104,788                        | —         | —
Adjustments related to equity (loss) income (d)                                      | 282,375    | 219,395   | 217,866                        | 137,496   | 136,921
Adjusted EBITDA                                                                      | 951,913    | 775,633   | 951,118                        | 1,287,003 | 1,415,794

table reconciles consolidated EBITDA Adjusted EBITDA to net (loss income.
 Foreign currency exchange loss includes unrealized loss $13. 2 million 2019 (2018 gain $21. million 2017 $82. million 2016 $75. million 2015 loss $89. million currency swaps.
 June 2016, Altera canceled construction contracts UMS newbuildings. accrued damages liabilities.
 net loss $23. 4 million December 2016 reported loss consolidated statement income. newbuilding contracts Altera subsidiaries obligations non-recourse.
 December 2016, Company recorded write-down cost-accounted investment $19. million. sold 2017 gain on sale $1. 3 million. recognized additional tax indemnification guarantee liability $50 million Teekay Nakilat finance leases. "Item 18 Financial Statements Note 15 Other loss.
 Adjustments equity (loss income non-GAAP alternative. vary. comparable to other.
Adjustments equity income depreciation amortization interest expense income tax amortization contracts finance lease payments sales vessels derivative instruments foreign currency contracts
 equity-accounted investments.
 Ended December 31,
 2018 2017 2016 2015
 Income Statement Data. Dollars
 Reconciliation EBITDA Adjusted EBITDA Net income
 income $(148,986 $(57,747),072) $86,664 $405,460
 Income tax expense 25,482 19,724,232
 Depreciation amortization 290,672 276,307 485,829 571,825
 Interest expense 271,255 245,601 262,110 278,145 236,481
 EBITDA 438,423 483,885 231,099 961,102
 Foreign exchange loss 13,574 (6,140 26,463 6,548 2,195
14,475 53,981 39,013
 sale vessels 170,310 53,693 270,743 112,246 70,175
 lease 21,636 11,082 18,737 24,429
 (4,131 (10,217),460 (24,226)
 losses instruments 13,719 14,852 38,854 35,091 102,200
 1,532 2,047 (8,646 (20,008
 Loss deconsolidation 7,070 104,788
 equity 282,375 219,395 217,866 137,496 136,921
 EBITDA 951,913,633 951,118 1,287,003 1,415,794


The following table provides the weighted average actuarial assumptions used to determine net periodic benefit costfor years ended:
For domestic plans, the discount rate was determined by comparison against the FTSE pension liability index for AA rated corporate instruments. The Company monitors other indices to assure that the pension obligations are fairly reported on a consistent basis. The international discount rates were determined by comparison against country specific AA corporate indices, adjusted for duration of the obligation.
The periodic benefit cost and the actuarial present value of projected benefit obligations are based on actuarial assumptions that are reviewed on an annual basis. The Company revises these assumptions based on an annual evaluation of longterm trends, as well as market conditions that may have an impact on the cost of providing retirement benefits.

                               | Domestic      |       | International |
------------------------------ | ------------- | ----- | ------------- | -----
                               | September 30, |       | September 30, |
                               | 2019          | 2018  | 2019          | 2018
Discount rate                  | 4.00%         | 3.75% | 1.90%         | 2.80%
Expected return on plan assets |               |       | 3.40%         | 3.70%
Rate of compensation increase  |               |       | - - %         | - - %

table provides assumptions periodic benefit years
 domestic plans discount rate FTSE pension liability index AA rated corporate instruments. Company monitors indices. international discount rates determined country AA corporate indices adjusted duration obligation.
 periodic benefit cost actuarial present value obligations based assumptions reviewed. Company revises assumptions longterm trends market conditions retirement.
 International
 September 30
 Discount rate 4.% 3. 75%. 90%. 80%
 Expected return on plan assets 3. 40%. 70%
 Rate compensation increase


Non-Recurring Fair Value
Certain assets, under certain conditions, are measured at fair value on a nonrecurring basis utilizing Level 3 inputs, as described in Note 1, Overview and Summary of Significant Accounting Policies, like those associated with acquired businesses, including goodwill, other intangible assets, other long-lived assets and equity method investments. For these assets, measurement at fair value in periods subsequent to their initial recognition would be applicable if these assets were determined to be impaired.
The adjusted carrying values for assets measured at fair value on a nonrecurring basis (no liabilities) subject to the requirements of ASC 820 were not material at December 31, 2019 and 2018. The following table summarizes the total impairment losses in the accompanying Consolidated Statements of Operations related to nonrecurring fair value measurements of certain assets (no liabilities):
In connection with the closure of certain under-utilized customer engagement centers and the consolidation of leased space in the U.S. and Canada, the Company recorded impairment charges of $1.7 million, $9.4 million and $5.2 million during the years ended December 2019, 2018 and 2017, respectively, related to the exit of leased facilities as well as leasehold improvements, equipment, furniture and fixtures which were not recoverable. See Note 5, Costs Associated with Exit or Disposal Activities, for further information.
Also, the Company recorded an impairment charge of $0.2 million related to the write-down of a vacant and unused parcel of land in the U.S. to its estimated fair value during the year ended December 31, 2017.

                                    |          | Years Ended December31, |
----------------------------------- | -------- | ----------------------- | --------
                                    | 2019     | 2018                    | 2017
Americas:                           |          |                         |
Property and equipment, net         | $(343)   | $(9,401)                | $(5,410)
Operating lease right-of-use assets | (1,368)  | —                       | —
                                    | $(1,711) | $(9,401)                | $(5,410)

Non-Recurring Fair Value
 assets measured fair value Level 3 inputs Note 1 Accounting Policies acquired businesses goodwill intangible assets long-lived assets equity investments. measurement fair value impaired.
 adjusted carrying values assets ASC 820 not material December 31, 2019 2018. table summarizes impairment losses Consolidated Statements Operations nonrecurring fair value measurements
 closure under-utilized centers consolidation leased space. Canada recorded impairment charges $1. 7 million $9. 4 million $5. 2 million December 2019 2018 2017 exit leased facilities leasehold improvements equipment furniture fixtures not recoverable. Note 5 Costs Associated Exit Disposal Activities.
 recorded impairment charge $0. 2 million write-down vacant unused parcel land U. fair value December 31, 2017.
 Property equipment(9,401)
 Operating lease right-of-use assets