in 2012 , as a result of our fgi , we sold 36 restaurant operations to franchisees . as of december 26 , 2012 , we have sold 380 company restaurants since our fgi program began in early 2007. while we now consider the fgi program to be complete , we may , from time to time , continue to sell restaurants to franchisees where geographically and economically beneficial to the company . additionally , we have negotiated development agreements for 257 new domestic restaurants , 133 of which have opened . the majority of the remaining restaurants in the development agreement pipeline are expected to open over the next five years . while the majority of the restaurants to be opened under these agreements are on schedule , from time to time some of our franchisees ' ability to grow and meet their development commitments is hampered by the economy and the difficult lending environment . as a result of the development efforts described above , over the past five years we have transitioned from a restaurant portfolio mix of 66 % franchised and 34 % company-operated to a restaurant portfolio mix of 90 % franchised and 10 % company-operated at december 26 , 2012. now that we have achieved our mix target , we expect that our percentage of company-operated restaurants will gradually decrease , as the majority of our future unit growth will be through franchised restaurants . specifically , our focus on fgi has impacted our financial performance as follows : company restaurant sales have decreased from $ 423.9 million in 2010 to $ 353.7 million in 2012 , primarily as a result of the sale of restaurants to franchisees . the decline in company restaurant revenues is partially offset by increased royalty income derived from the growth in the franchise restaurant base resulting from both traditional development and the conversion of restaurants . as a result , royalty income , which is included as a component of franchise and license revenue , has increased from $ 73.0 million in 2010 to $ 83.8 million in 2012. the resulting net reduction in total revenue related to our fgi is generally recovered by the benefits of a lower cost structure related to franchise and license revenues , a decrease in depreciation and amortization due to the sale of restaurant related assets to franchisees ( from $ 29.6 million in 2010 to $ 22.3 million in 2012 ) and a reduction in interest expense resulting from the use of proceeds to reduce debt ( from $ 25.8 million in 2010 to $ 13.4 million in 2012 ) . see also `` debt and refinancing and reductions `` below . initial franchise fees , included as a component of franchise and license revenue , are generally recognized in the period in which a restaurant is sold to a franchisee or when a new unit is opened . these initial fees are completely dependent on the number of restaurants sold to or opened by franchisees during a particular period and , as a result , can cause fluctuations in our total franchise and license revenue from year to year . occupancy revenues , also included as a component of franchise and license revenue , result from leasing or subleasing restaurants to franchisees . as a result of our fgi , occupancy revenues have increased from $ 44.8 million in 2010 to $ 47.8 million in 2012. additionally , when restaurants are sold and leased or subleased to franchisees , the occupancy costs related to these restaurants moves from costs of company restaurant sales to costs of franchise and license revenue to match the related occupancy revenue . as subleases with franchisees end over time , franchise occupancy revenue and costs could decrease if franchisees enter into direct leases with landlords . gains on sales of assets are primarily dependent on the number of restaurants sold to franchisees during a particular period , and as a result , can cause fluctuations in net income from year to year . with the completion of our fgi , gains on sales of assets are expected to decrease . 19 debt refinancing and reductions interest expense has a significant impact on our net income as a result of our indebtedness . however , over the past several years , we have continued to reduce interest expense through a series of debt refinancings and repayments using the proceeds generated from our fgi transactions , sales of real estate and cash flow from operations . these repayments resulted in an overall debt reduction of approximately $ 15 million during 2010 , $ 42 million in 2011 and $ 28 million in 2012. during the second quarter of 2012 , we refinanced our credit facility ( the `` new credit facility `` ) principally to take advantage of lower interest rates available in the senior secured debt market . borrowings for the new term loan bear a tiered interest rate based on the company 's consolidated leverage ratio and was initially set at libor plus 300 basis points . the new credit facility does not contain an interest rate floor for either the term loan or the revolver . it includes an accordion feature that would allow us to increase the size of the facility to $ 300 million . a commitment fee of 50 basis points is paid on the unused portion of the revolving credit facility . in accordance with the debt covenants , the reduction in term loan debt resulted in a decrease in the interest rate and the commitment fee . the interest rate is currently set at libor plus 275 basis points and the commitment fee was reduced to 37.5 basis points . story_separator_special_tag on an ongoing basis , we evaluate our estimates , including those related to self-insurance liabilities , impairment of long-lived assets , restructuring and exit costs , income taxes and share-based compensation . we base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances , the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources . actual results may differ from these estimates under different assumptions or conditions ; however , we believe that our estimates , including those for the above-described items , are reasonable . we believe the following critical accounting policies affect our more significant judgments and estimates used in the preparation of our consolidated financial statements : self-insurance liabilities . we record liabilities for insurance claims during periods in which we have been insured under large deductible programs or have been self-insured for our medical and dental claims and workers ' compensation , general/product and automobile insurance liabilities . maximum self-insured retention , including defense costs per occurrence , ranges from $ 0.5 million to $ 1.0 million per individual claim for workers ' compensation and for general/product and automobile liability . the liabilities for prior and current estimated incurred losses are discounted to their present value based on expected loss payment patterns determined by independent actuaries using our actual historical payments . these estimates include assumptions regarding claims frequency and severity as well as changes in our business environment , medical costs and the regulatory environment that could impact our overall self-insurance costs . total discounted workers ' compensation and general liability insurance liabilities at december 26 , 2012 and december 28 , 2011 were $ 23.2 million reflecting a 1.0 % discount rate and $ 24.6 million reflecting a 1.5 % discount rate , respectively . the related undiscounted amounts at such dates were $ 23.8 million and $ 25.6 million , respectively . impairment of long-lived assets . we evaluate our long-lived assets for impairment at the restaurant level on a quarterly basis , when assets are identified as held for sale or whenever changes or events indicate that the carrying value may not be recoverable . we assess impairment of restaurant-level assets based on the operating cash flows of the restaurant , expected proceeds from the sale of assets and our plans for restaurant closings . generally , all restaurants with negative cash flows from operations for the most recent twelve months at each quarter end are included in our assessment . in performing our assessment , we make assumptions regarding estimated future cash flows , including estimated proceeds from similar asset sales , and other factors to determine both the recoverability and the estimated fair value of the respective assets . if the long-lived assets of a restaurant are not recoverable based upon estimated future , undiscounted cash flows , we write the assets down to their fair value . if these estimates or their related assumptions change in the future , we may be required to record additional impairment charges . during 2012 , 2011 and 2010 , we recorded impairment charges of $ 3.7 million , $ 4.1 million , and $ 0.4 million , respectively , for underperforming restaurants , including restaurants closed and company restaurants classified as held for sale . these charges are included as a component of operating ( gains ) , losses and other charges , net in our consolidated statements of income . at december 26 , 2012 , we had a total of two restaurants with an aggregate net book value of approximately $ 0.3 million , after taking into consideration impairment charges recorded , which had negative cash flows from operations for the most recent twelve months . restructuring and exit costs . as a result of changes in our organizational structure and in our portfolio of restaurants , we have recorded charges for restructuring and exit costs . these costs consist primarily of the costs of future obligations related to closed restaurants and severance and other restructuring charges for terminated employees . these costs are included as a component of operating ( gains ) , losses and other charges , net in our consolidated statements of income . 32 discounted liabilities for future lease costs and the fair value of related subleases of closed restaurants are recorded when the restaurants are closed . all other costs related to closed restaurants are expensed as incurred . in assessing the discounted liabilities for future costs of obligations related to closed restaurants , we make assumptions regarding amounts of future subleases . if these assumptions or their related estimates change in the future , we may be required to record additional exit costs or reduce exit costs previously recorded . exit costs recorded for each of the periods presented include the effect of such changes in estimates . the most significant estimate included in our accrued exit costs liabilities relates to the timing and amount of estimated subleases . at december 26 , 2012 , our total discounted liability for closed restaurants was approximately $ 4.1 million , net of $ 1.8 million related to existing sublease agreements and $ 3.3 million related to properties for which we expect to enter into sublease agreements in the future . if any of the estimates noted above or their related assumptions change in the future , we may be required to record additional exit costs or reduce exit costs previously recorded . income taxes . we record valuation allowances against our deferred tax assets , when necessary . realization of deferred tax assets is dependent on future taxable earnings and is therefore uncertain . we assess the likelihood that our deferred tax assets in each of the jurisdictions in which we operate will be recovered from future taxable income . deferred tax assets do not include future tax benefits

liquidity and capital resources summary of cash flows our primary sources of liquidity and capital resources are cash generated from operations , borrowings under our credit facility ( as described below ) and , in recent years , cash proceeds from the sale of restaurant operations to franchisees and sales of surplus properties , to the extent allowed by our credit facility . principal uses of cash are operating expenses , capital expenditures , debt repayments and , recently , the repurchase of shares of our common stock . the following table presents a summary of our sources and uses of cash and cash equivalents for the periods indicated : replace_table_token_25_th 29 we believe that our estimated cash flows from operations for 2012 , combined with our capacity for additional borrowings under our credit facility , will enable us to meet our anticipated cash requirements and fund capital expenditures over the next twelve months . net cash flows used in investing activities were $ 3.5 million for the year ended december 26 , 2012 . these cash flows include $ 15.6 million in proceeds from asset sales and collections of notes receivable of $ 2.0 million , partially offset by capital expenditures of $ 14.2 million , acquisition of a restaurant unit of $ 1.4 million and issuances of notes receivable of $ 5.4 million . the notes receivable primarily consist of notes from franchisees related to the system-wide roll-out of new coffee equipment . of these notes receivable , approximately $ 4.1 million are due within the next 12 months . our principal capital requirements have been largely associated with the following : replace_table_token_26_th the decrease in new construction is primarily the result of the conversion of restaurants at pilot flying j travel centers during the prior year . capital expenditures for fiscal 2013 are expected to be approximately $ 17-19 million , including approximately 20-25 remodels at company restaurants .


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```liquidity and capital resources summary of cash flows our primary sources of liquidity and capital resources are cash generated from operations , borrowings under our credit facility ( as described below ) and , in recent years , cash proceeds from the sale of restaurant operations to franchisees and sales of surplus properties , to the extent allowed by our credit facility . principal uses of cash are operating expenses , capital expenditures , debt repayments and , recently , the repurchase of shares of our common stock . the following table presents a summary of our sources and uses of cash and cash equivalents for the periods indicated : replace_table_token_25_th 29 we believe that our estimated cash flows from operations for 2012 , combined with our capacity for additional borrowings under our credit facility , will enable us to meet our anticipated cash requirements and fund capital expenditures over the next twelve months . net cash flows used in investing activities were $ 3.5 million for the year ended december 26 , 2012 . these cash flows include $ 15.6 million in proceeds from asset sales and collections of notes receivable of $ 2.0 million , partially offset by capital expenditures of $ 14.2 million , acquisition of a restaurant unit of $ 1.4 million and issuances of notes receivable of $ 5.4 million . the notes receivable primarily consist of notes from franchisees related to the system-wide roll-out of new coffee equipment . of these notes receivable , approximately $ 4.1 million are due within the next 12 months . our principal capital requirements have been largely associated with the following : replace_table_token_26_th the decrease in new construction is primarily the result of the conversion of restaurants at pilot flying j travel centers during the prior year . capital expenditures for fiscal 2013 are expected to be approximately $ 17-19 million , including approximately 20-25 remodels at company restaurants .
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 Suspicious Activity Report : in 2012 , as a result of our fgi , we sold 36 restaurant operations to franchisees . as of december 26 , 2012 , we have sold 380 company restaurants since our fgi program began in early 2007. while we now consider the fgi program to be complete , we may , from time to time , continue to sell restaurants to franchisees where geographically and economically beneficial to the company . additionally , we have negotiated development agreements for 257 new domestic restaurants , 133 of which have opened . the majority of the remaining restaurants in the development agreement pipeline are expected to open over the next five years . while the majority of the restaurants to be opened under these agreements are on schedule , from time to time some of our franchisees ' ability to grow and meet their development commitments is hampered by the economy and the difficult lending environment . as a result of the development efforts described above , over the past five years we have transitioned from a restaurant portfolio mix of 66 % franchised and 34 % company-operated to a restaurant portfolio mix of 90 % franchised and 10 % company-operated at december 26 , 2012. now that we have achieved our mix target , we expect that our percentage of company-operated restaurants will gradually decrease , as the majority of our future unit growth will be through franchised restaurants . specifically , our focus on fgi has impacted our financial performance as follows : company restaurant sales have decreased from $ 423.9 million in 2010 to $ 353.7 million in 2012 , primarily as a result of the sale of restaurants to franchisees . the decline in company restaurant revenues is partially offset by increased royalty income derived from the growth in the franchise restaurant base resulting from both traditional development and the conversion of restaurants . as a result , royalty income , which is included as a component of franchise and license revenue , has increased from $ 73.0 million in 2010 to $ 83.8 million in 2012. the resulting net reduction in total revenue related to our fgi is generally recovered by the benefits of a lower cost structure related to franchise and license revenues , a decrease in depreciation and amortization due to the sale of restaurant related assets to franchisees ( from $ 29.6 million in 2010 to $ 22.3 million in 2012 ) and a reduction in interest expense resulting from the use of proceeds to reduce debt ( from $ 25.8 million in 2010 to $ 13.4 million in 2012 ) . see also `` debt and refinancing and reductions `` below . initial franchise fees , included as a component of franchise and license revenue , are generally recognized in the period in which a restaurant is sold to a franchisee or when a new unit is opened . these initial fees are completely dependent on the number of restaurants sold to or opened by franchisees during a particular period and , as a result , can cause fluctuations in our total franchise and license revenue from year to year . occupancy revenues , also included as a component of franchise and license revenue , result from leasing or subleasing restaurants to franchisees . as a result of our fgi , occupancy revenues have increased from $ 44.8 million in 2010 to $ 47.8 million in 2012. additionally , when restaurants are sold and leased or subleased to franchisees , the occupancy costs related to these restaurants moves from costs of company restaurant sales to costs of franchise and license revenue to match the related occupancy revenue . as subleases with franchisees end over time , franchise occupancy revenue and costs could decrease if franchisees enter into direct leases with landlords . gains on sales of assets are primarily dependent on the number of restaurants sold to franchisees during a particular period , and as a result , can cause fluctuations in net income from year to year . with the completion of our fgi , gains on sales of assets are expected to decrease . 19 debt refinancing and reductions interest expense has a significant impact on our net income as a result of our indebtedness . however , over the past several years , we have continued to reduce interest expense through a series of debt refinancings and repayments using the proceeds generated from our fgi transactions , sales of real estate and cash flow from operations . these repayments resulted in an overall debt reduction of approximately $ 15 million during 2010 , $ 42 million in 2011 and $ 28 million in 2012. during the second quarter of 2012 , we refinanced our credit facility ( the `` new credit facility `` ) principally to take advantage of lower interest rates available in the senior secured debt market . borrowings for the new term loan bear a tiered interest rate based on the company 's consolidated leverage ratio and was initially set at libor plus 300 basis points . the new credit facility does not contain an interest rate floor for either the term loan or the revolver . it includes an accordion feature that would allow us to increase the size of the facility to $ 300 million . a commitment fee of 50 basis points is paid on the unused portion of the revolving credit facility . in accordance with the debt covenants , the reduction in term loan debt resulted in a decrease in the interest rate and the commitment fee . the interest rate is currently set at libor plus 275 basis points and the commitment fee was reduced to 37.5 basis points . story_separator_special_tag on an ongoing basis , we evaluate our estimates , including those related to self-insurance liabilities , impairment of long-lived assets , restructuring and exit costs , income taxes and share-based compensation . we base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances , the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources . actual results may differ from these estimates under different assumptions or conditions ; however , we believe that our estimates , including those for the above-described items , are reasonable . we believe the following critical accounting policies affect our more significant judgments and estimates used in the preparation of our consolidated financial statements : self-insurance liabilities . we record liabilities for insurance claims during periods in which we have been insured under large deductible programs or have been self-insured for our medical and dental claims and workers ' compensation , general/product and automobile insurance liabilities . maximum self-insured retention , including defense costs per occurrence , ranges from $ 0.5 million to $ 1.0 million per individual claim for workers ' compensation and for general/product and automobile liability . the liabilities for prior and current estimated incurred losses are discounted to their present value based on expected loss payment patterns determined by independent actuaries using our actual historical payments . these estimates include assumptions regarding claims frequency and severity as well as changes in our business environment , medical costs and the regulatory environment that could impact our overall self-insurance costs . total discounted workers ' compensation and general liability insurance liabilities at december 26 , 2012 and december 28 , 2011 were $ 23.2 million reflecting a 1.0 % discount rate and $ 24.6 million reflecting a 1.5 % discount rate , respectively . the related undiscounted amounts at such dates were $ 23.8 million and $ 25.6 million , respectively . impairment of long-lived assets . we evaluate our long-lived assets for impairment at the restaurant level on a quarterly basis , when assets are identified as held for sale or whenever changes or events indicate that the carrying value may not be recoverable . we assess impairment of restaurant-level assets based on the operating cash flows of the restaurant , expected proceeds from the sale of assets and our plans for restaurant closings . generally , all restaurants with negative cash flows from operations for the most recent twelve months at each quarter end are included in our assessment . in performing our assessment , we make assumptions regarding estimated future cash flows , including estimated proceeds from similar asset sales , and other factors to determine both the recoverability and the estimated fair value of the respective assets . if the long-lived assets of a restaurant are not recoverable based upon estimated future , undiscounted cash flows , we write the assets down to their fair value . if these estimates or their related assumptions change in the future , we may be required to record additional impairment charges . during 2012 , 2011 and 2010 , we recorded impairment charges of $ 3.7 million , $ 4.1 million , and $ 0.4 million , respectively , for underperforming restaurants , including restaurants closed and company restaurants classified as held for sale . these charges are included as a component of operating ( gains ) , losses and other charges , net in our consolidated statements of income . at december 26 , 2012 , we had a total of two restaurants with an aggregate net book value of approximately $ 0.3 million , after taking into consideration impairment charges recorded , which had negative cash flows from operations for the most recent twelve months . restructuring and exit costs . as a result of changes in our organizational structure and in our portfolio of restaurants , we have recorded charges for restructuring and exit costs . these costs consist primarily of the costs of future obligations related to closed restaurants and severance and other restructuring charges for terminated employees . these costs are included as a component of operating ( gains ) , losses and other charges , net in our consolidated statements of income . 32 discounted liabilities for future lease costs and the fair value of related subleases of closed restaurants are recorded when the restaurants are closed . all other costs related to closed restaurants are expensed as incurred . in assessing the discounted liabilities for future costs of obligations related to closed restaurants , we make assumptions regarding amounts of future subleases . if these assumptions or their related estimates change in the future , we may be required to record additional exit costs or reduce exit costs previously recorded . exit costs recorded for each of the periods presented include the effect of such changes in estimates . the most significant estimate included in our accrued exit costs liabilities relates to the timing and amount of estimated subleases . at december 26 , 2012 , our total discounted liability for closed restaurants was approximately $ 4.1 million , net of $ 1.8 million related to existing sublease agreements and $ 3.3 million related to properties for which we expect to enter into sublease agreements in the future . if any of the estimates noted above or their related assumptions change in the future , we may be required to record additional exit costs or reduce exit costs previously recorded . income taxes . we record valuation allowances against our deferred tax assets , when necessary . realization of deferred tax assets is dependent on future taxable earnings and is therefore uncertain . we assess the likelihood that our deferred tax assets in each of the jurisdictions in which we operate will be recovered from future taxable income . deferred tax assets do not include future tax benefits

