IRON MOUNTAIN INCORPORATED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) DECEMBER 31, 2002 (In thousands, except share and per share data) 6.
Selected Consolidated Financial Statements of Parent, Guarantors and Non-Guarantors (Continued)
## Table 0 ##
7.
Acquisitions On February 1, 2000, we completed the acquisition of Pierce Leahy in a stock-for-stock merger valued at $1,035,747.
The total consideration for this transaction was comprised of: (i) 18,784 shares of our common stock with a fair value of $421,220; (ii) 1,645 options to acquire our common stock with a
IRON MOUNTAIN INCORPORATED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) DECEMBER 31, 2018 (In thousands, except share and per share data) 2.
Summary of Significant Accounting Policies (Continued) Property, plant and equipment (including capital leases in the respective category), at cost, consist of the following:
## Table 1 ##
Minor maintenance costs are expensed as incurred.
Major improvements which extend the life, increase the capacity or improve the safety or the efficiency of property owned are capitalized.
Major improvements to leased buildings are capitalized as leasehold improvements and depreciated.
We capitalize interest expense during the active construction period of major capital projects.
Capitalized interest is added to the cost of the underlying assets and is amortized over the useful lives of the assets.
During the year ended December 31, 2018, we capitalized interest of $3,732.
The amount of capitalized interest during the years ended December 31, 2016 and 2017 was insignificant.
We develop various software applications for internal use.
Computer software costs associated with internal use software are expensed as incurred until certain capitalization criteria are met.
Payroll and related costs for employees directly associated with, and devoting time to, the development of internal use computer software projects (to the extent time is spent directly on the project) are capitalized.
During the years ended December 31, 2016, 2017 and 2018, we capitalized $16,438, $25,166 and $29,407 of costs, respectively, associated with the development of internal use computer software projects.
Capitalization begins when the design stage of the application has been completed and it is probable that the project will be completed and used to perform the function intended.
Capitalization ends when the asset is ready for its intended use.
Depreciation begins when the software is placed in service.
Computer software costs that are capitalized are periodically evaluated for impairment.
We did not record any material write-offs of deferred software costs during the years ended December 31, 2016, 2017 and 2018.
Entities are required to record the fair value of a liability for an asset retirement obligation in the period in which it is incurred.
Asset retirement obligations represent the costs to replace or remove tangible long-lived assets required by law, regulatory rule or contractual agreement.
When the liability is initially recorded, the entity capitalizes the cost by increasing the carrying amount of the related long-lived asset, which is then depreciated over the useful life of the related asset.
The liability is increased over time through accretion expense (included in depreciation expense) such that the liability will equate to the future cost to retire the long-lived asset at the expected retirement date.
Upon settlement of the liability, an entity either settles the obligation for its recorded amount or realizes a gain or loss upon settlement.
Our asset retirement obligations are primarily the result of requirements under our facility lease agreements which generally have "return to original condition" clauses which would require us to remove or restore items such as shred pits, vaults, demising walls and office build-outs, among others.
The significant assumptions used in estimating our aggregate asset retirement obligation are the timing of removals, the probability of a requirement to perform, estimated cost and associated expected inflation rates that are consistent with historical rates and credit-adjusted risk-free rates that approximate our incremental borrowing rate.
Our asset retirement obligations at December 31, 2017 and 2018 were $27,757 and $28,256, respectively.
Global Brand Concepts American Living American Living is the first brand developed under the new Global Brand Concepts group.
American Living is a full lifestyle brand, featuring menswear, womenswear, childrenswear, accessories and home furnishings with a focus on timeless, authentic American classics for every day.
American Living is available exclusively at JCPenney in the U. S.  and online at JCP.
com.
Our Wholesale Segment Our Wholesale segment sells our products to leading upscale and certain mid-tier department stores, specialty stores and golf and pro shops, both domestically and internationally.
We have focused on elevating our brand and improving productivity by reducing the number of unproductive doors within department stores in which our products are sold, improving in-store product assortment and presentation, and improving full-price sell-throughs to consumers.
As of March 29, 2008, the end of Fiscal 2008, our products were sold through 10,806 doors worldwide, and during Fiscal 2008, we invested approximately $49 million in shop-within-shops dedicated to our products primarily in domestic and international department stores.
We have also effected selective price increases on basic products and introduced new fashion offerings at higher price points.
Department stores are our major wholesale customers in North America.
In Europe, our wholesale sales are a varying mix of sales to both department stores and specialty shops, depending on the country.
Our collection brands — Women’s Ralph Lauren Collection and Black Label and Men’s Purple Label Collection and Black Label — are distributed through a limited number of premier fashion retailers.
In addition, we sell excess and outof-season products through secondary distribution channels, including our retail factory stores.
In Japan, our products are distributed primarily through shop-within-shops at premiere department stores.
The mix of business is weighted to Polo Ralph Lauren in Men’s and Women’s Blue Label.
The distribution of Men’s and Women’s Black Label is also expanding through shop-within-shop presentations in top tier department stores across Japan.
Worldwide Distribution Channels The following table presents the approximate number of doors by geographic location, in which products distributed by our Wholesale segment were sold to consumers as of March 29, 2008:
## Table 2 ##
(a) In Asia/Pacific (excluding Japan), our products are distributed by our licensing partners.
The following department store chains were wholesale customers whose purchases represented more than 10% of our worldwide wholesale net sales for the year ended March 29, 2008: ?
Macy’s, Inc.  (formerly known as Federated Department Stores, Inc. ), which represented approximately 24%; and ?
Dillard Department Stores, Inc. , which represented approximately 12%.
Our product brands are sold primarily through their own sales forces.
Our Wholesale segment maintains their primary showrooms in New York City.
In addition, we maintain regional showrooms in Atlanta, Chicago, Dallas, Los Angeles, Milan, Paris, London, Munich, Madrid and Stockholm.
Other Revenue Other revenue decreased $6.0 million for the year ended 2016 to $13.5 million from $19.5 million in the same period in the prior year.
The decrease in other revenue was primarily due to lower revenue from fines assessed for rule violations and, in 2015, the recognition of revenue to adjust for incorrect coding of transactions by an exchange participant related to prior periods.
Concentration of Revenue All contracts traded on our exchanges must be cleared through clearing members of OCC.
At December 31, 2016, there were one hundred one Trading Permit Holders that are clearing members of OCC.
Two clearing members accounted for 42% of transaction and other fees collected through OCC in 2016.
The next largest clearing member accounted for approximately 14% of transaction and other fees collected through OCC.
No one Trading Permit Holder using the clearing services of the top two clearing member firms represented more than 21% of transaction and other fees collected through OCC, for the respective clearing member, in 2016.
Should a clearing member withdraw from CBOE, we believe the Trading Permit Holder portion of that clearing member’s trading activity would likely transfer to another clearing member.
The two largest clearing members mentioned above clear the majority of the market-maker sides of transactions at CBOE, C2 and at all of the U. S.  options exchanges.
If either of these clearing members were to withdraw from the business of market-maker clearing and market-makers were unable to transfer to another clearing member, this could create significant disruption to the U. S.  options markets, including ours.
Operating Expenses Total operating expenses increased $44.1 million, or 14.0%, to $358.7 million for the year ended 2016 from $314.6 million in the year ago period, resulting from higher compensation and benefits, professional fees and outside services, travel and promotional expense and royalty fees.
Expenses increased to 54.7% of total operating revenues in the year ended 2016 compared with 49.6% in the same period in 2015.
The following summarizes changes in operating expenses for the year ended December 31, 2016 compared to 2015.
## Table 3 ##
Compensation and Benefits For the year ended December 31, 2016, compensation and benefits were $113.2 million, or 17.2% of total operating revenues, compared with $105.9 million, or 16.7% of total operating revenues, in the same period in 2015.
This represented an increase of $7.3 million, or 6.8%, which primarily resulted from increased staffing levels, higher stock-based compensation, including accelerated stock-based compensation expense, and annual incentive compensation, which is aligned with our financial performance relative to our targets.
The year ended December 31, 2016 included $0.9 million of accelerated stock-based compensation expense, respectively, for certain officers and employees as a result of attaining certain age and service based requirements in our long-term incentive plan and award agreements.
Stock-based compensation expense, included in compensation and benefits expense, is expected to be approximately $27.5 million for 2017.
This includes $13.0 million in accelerated stock-based compensation, approximately $12.0 million of which is expected to be recognized in the first quarter of 2017.
The increase in accelerated stock-based compensation versus 2016, reflects a planned change in the retirement vesting schedule for equity award grants.
Depreciation and Amortization Depreciation and amortization decreased by $1.9 million to $44.4 million for the year ended December 31, 2016 compared with $46.3 million for the same period in 2015.
The decrease was primarily due to the the acceleration of depreciation for certain assets that have a shorter than expected useful life through June 30, 2016, partially offset by the amortization of intangible assets related to the acquisitions of Livevol and Vest.
Professional Fees and Outside Services Expenses related to professional fees and outside services increased to $78.5 million for the year ended December 31, 2016 from $50.1 million in the prior-year period, an increase of $28.4 million, which primarily resulted from higher legal and professional fees, primarily Bats acquisition-related costs totaling $13.7 million, and higher contract services related to certain regulatory services provided by FINRA and other self-regulatory organization commitments for CBOE and C2.
In connection with the anticipated merger with Bats and the planned migration to the Bats trading platform and the suspension of CBOE Vector, our investment of $15.0 million related to the development of Vector, in 2017, could become obsolete or result in a shorter than expected useful life.
Royalty Fees Royalty fees for the year ended December 31, 2016 were $77.9 million compared with $70.6 million for the prior year period, an increase of $7.3 million, which primarily resulted from higher trading volume in licensed products.
Travel and promotional expenses Travel and promotional expenses for the year ended December 31, 2016 were $11.0 million compared with $8.9 million for the prior year period.
The increase is primarily due to higher advertising expenses.
Operating Income As a result of the items above, operating income in 2016 was $298.2 million compared to $319.9 million in 2015, a decrease of $21.7 million.
Other Income Other income totaled $8.4 million for the year ended December 31, 2016 compared with $4.1 million for the same period in the prior year.
The increase in other income in 2016 primarily

<table><tr><td></td><td colspan="6">Year Ended December 31, 2001</td></tr><tr><td></td><td>Parent</td><td>Guarantors</td><td>Canada Company</td><td>Non- Guarantors</td><td>Eliminations</td><td>Consolidated</td></tr><tr><td>Cash Flows from Operating Activities:</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Cash Flows (Used in) Provided by Operating Activities</td><td>$-92,031</td><td>$235,765</td><td>$8,867</td><td>$8,308</td><td>$—</td><td>$160,909</td></tr><tr><td>Cash Flows from Investing Activities:</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Capital expenditures</td><td>—</td><td>-164,335</td><td>-10,330</td><td>-22,374</td><td>—</td><td>-197,039</td></tr><tr><td>Cash paid for acquisitions, net of cash acquired</td><td>—</td><td>-50,467</td><td>-177</td><td>-20,753</td><td>—</td><td>-71,397</td></tr><tr><td>Investment in convertible preferred stock</td><td>—</td><td>-2,000</td><td>—</td><td>—</td><td>—</td><td>-2,000</td></tr><tr><td>Intercompany loans to subsidiaries</td><td>-20,204</td><td>-15,836</td><td>—</td><td>—</td><td>36,040</td><td>—</td></tr><tr><td>Investment in subsidiaries</td><td>-6,866</td><td>-6,866</td><td>—</td><td>—</td><td>13,732</td><td>—</td></tr><tr><td>Additions to customer relationship and acquisition costs</td><td>—</td><td>-7,292</td><td>-319</td><td>-809</td><td>—</td><td>-8,420</td></tr><tr><td>Proceeds from sales of property and equipment</td><td>—</td><td>87</td><td>21</td><td>612</td><td>—</td><td>720</td></tr><tr><td>Cash Flows Used in Investing Activities</td><td>-27,070</td><td>-246,709</td><td>-10,805</td><td>-43,324</td><td>49,772</td><td>-278,136</td></tr><tr><td>Cash Flows from Financing Activities:</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Net repayment of term loans</td><td>-1,000</td><td>—</td><td>—</td><td>—</td><td>—</td><td>-1,000</td></tr><tr><td>Repayment of debt</td><td>-109,869</td><td>-1,066</td><td>-2,590</td><td>-3,753</td><td>—</td><td>-117,278</td></tr><tr><td>Proceeds from borrowings</td><td>103,411</td><td>73</td><td>—</td><td>2,111</td><td>—</td><td>105,595</td></tr><tr><td>Early retirement of senior subordinated notes</td><td>-312,701</td><td>—</td><td>—</td><td>—</td><td>—</td><td>-312,701</td></tr><tr><td>Net Proceeds from sale of senior subordinated notes</td><td>427,924</td><td>—</td><td>—</td><td>—</td><td>—</td><td>427,924</td></tr><tr><td>Debt financing and equity contribution from minority shareholders</td><td>—</td><td>—</td><td>—</td><td>21,216</td><td>—</td><td>21,216</td></tr><tr><td>Intercompany loans from parent</td><td>—</td><td>13,130</td><td>7,016</td><td>15,894</td><td>-36,040</td><td>—</td></tr><tr><td>Equity contribution from parent</td><td>—</td><td>6,866</td><td>—</td><td>6,866</td><td>-13,732</td><td>—</td></tr><tr><td>Proceeds from exercise of stock options and employee stock purchase plan</td><td>12,079</td><td>—</td><td>—</td><td>—</td><td>—</td><td>12,079</td></tr><tr><td>Financing and stock issuance costs</td><td>-934</td><td>—</td><td>—</td><td>—</td><td>—</td><td>-934</td></tr><tr><td>Cash Flows Provided by Financing Activities</td><td>118,910</td><td>19,003</td><td>4,426</td><td>42,334</td><td>-49,772</td><td>134,901</td></tr><tr><td>Effect of exchange rates on cash and cash equivalents</td><td>—</td><td>—</td><td>-1,094</td><td>-1,421</td><td>—</td><td>-2,515</td></tr><tr><td>(Decrease) Increase in cash and cash equivalents</td><td>-191</td><td>8,059</td><td>1,394</td><td>5,897</td><td>—</td><td>15,159</td></tr><tr><td>Cash and cash equivalents, beginning of year</td><td>191</td><td>3,336</td><td>302</td><td>2,371</td><td>—</td><td>6,200</td></tr><tr><td>Cash and cash equivalents, end of year</td><td>$—</td><td>$11,395</td><td>$1,696</td><td>$8,268</td><td>$—</td><td>$21,359</td></tr></table>
<table><tr><td></td><td colspan="2">December 31,</td></tr><tr><td></td><td>2017</td><td>2018</td></tr><tr><td>Land</td><td>$314,897</td><td>$400,980</td></tr><tr><td>Buildings and building improvements</td><td>2,039,902</td><td>2,991,307</td></tr><tr><td>Leasehold improvements</td><td>592,700</td><td>770,666</td></tr><tr><td>Racking</td><td>1,996,594</td><td>2,001,831</td></tr><tr><td>Warehouse equipment/vehicles</td><td>467,345</td><td>481,515</td></tr><tr><td>Furniture and fixtures</td><td>55,245</td><td>56,207</td></tr><tr><td>Computer hardware and software</td><td>627,571</td><td>680,283</td></tr><tr><td>Construction in progress</td><td>156,846</td><td>218,160</td></tr><tr><td></td><td>$6,251,100</td><td>$7,600,949</td></tr></table>
<table><tr><td>Location</td><td>Number of   Doors<sup>(a)</sup></td></tr><tr><td>United States and Canada</td><td>8,611</td></tr><tr><td>Europe</td><td>2,075</td></tr><tr><td>Japan</td><td>120</td></tr><tr><td>Total</td><td>10,806</td></tr></table>
<table><tr><td></td><td>2016</td><td>2015</td><td>Inc./(Dec.)</td><td>PercentChange</td></tr><tr><td></td><td colspan="3">(in millions)</td><td></td></tr><tr><td>Compensation and benefits</td><td>$113.2</td><td>$105.9</td><td>$7.3</td><td>6.8%</td></tr><tr><td>Depreciation and amortization</td><td>44.4</td><td>46.3</td><td>-1.9</td><td>-4.1%</td></tr><tr><td>Technology support services</td><td>22.4</td><td>20.7</td><td>1.7</td><td>8.7%</td></tr><tr><td>Professional fees and outside services</td><td>78.5</td><td>50.1</td><td>28.4</td><td>56.9%</td></tr><tr><td>Royalty fees</td><td>77.9</td><td>70.6</td><td>7.3</td><td>10.5%</td></tr><tr><td>Order routing</td><td>0.9</td><td>2.3</td><td>-1.4</td><td>-60.8%</td></tr><tr><td>Travel and promotional expenses</td><td>11.0</td><td>8.9</td><td>2.1</td><td>22.1%</td></tr><tr><td>Facilities costs</td><td>5.7</td><td>5.0</td><td>0.7</td><td>13.9%</td></tr><tr><td>Other expenses</td><td>4.7</td><td>4.8</td><td>-0.1</td><td>-3.2%</td></tr><tr><td>Total operating expenses</td><td>$358.7</td><td>$314.6</td><td>$44.1</td><td>14.0%</td></tr></table>

Question: In which section the sum of Cash Flows (Used in) Provided by Operating Activities has the highest value?
Answer: Guarantors