The carrying value of assets held for disposal (which include stores, a minority interest investment in a non-core business and our idle processing facility in Wichita, Kansas) by reportable operating segment as of December 26, 1998 and December 27, 1997 were as follows:

We anticipate that all assets with the possible exception of the Wichita facility will be sold within the next twelve months.

The results of operations for stores held for disposal or disposed of in 1998 and 1997 were as follows:

We expect that the loss of restaurant margin from the disposal of these stores will be mitigated by the increased royalty fees for stores refranchised, lower general and administrative expenses and reduced interest costs primarily resulting from the reduction of debt by the after-tax cash proceeds from our refranchising activities. The margin reported above includes the benefit from the suspension of depreciation and amortization of approximately $37 million ($23 million in the U.S. and $14 million in International) and $17 million in the U.S. in 1998 and 1997, respectively, on assets held for disposal.

UNUSUAL CHARGES

Unusual charges in 1998 included: (1) an increase in the estimated costs of settlement of certain wage and hour litigation and associated defense and other costs incurred; (2) severance and other exit costs related to strategic decisions to streamline the infrastructure of our international businesses; (3) favorable adjustments to our 1997 fourth quarter charge related to anticipated actions that were not taken, primarily severance; (4) writedown to estimated fair market value less costs to sell of our minority interest in a privately held non-core business, previously carried at cost, now held for sale; and (5) reversals of certain valuation allowances and lease liabilities relating to better-than-expected proceeds from the sale of properties and settlement of lease liabilities associated with properties retained upon the sale of a Non-core Business.

Unusual charges in 1997 included: (1) $120 million ($125 million after-tax) of unusual asset impairment and severance charges included in our 1997 fourth quarter charge described above; (2) charges to further reduce the carrying amounts of the Non-core Businesses held for disposal to estimated market value, less costs to sell; and (3) charges relating to the estimated costs of settlement of certain wage and hour litigation and the associated defense and other costs incurred.

Unusual charges in 1996 resulted from our decision to dispose of our Non-core Businesses. The charge represented the reduction of the carrying amounts of the Non-core Businesses to estimated fair market value, less costs to sell. The estimated fair market value was initially determined by using estimated selling prices based upon the opinion of an investment banking firm retained to assist in the selling activity.

Our franchise and certain license arrangements for our traditional and non-traditional points of distribution, respectively, provide for initial fees. The agreements also require the franchisee or licensee to pay continuing fees based upon a percentage of sales. Initial franchise fees from refranchising activities arise from an initiative we adopted in late 1994 to reduce our percentage ownership of total system units by selling our stores to new and existing franchisees. We include initial franchise fees from refranchising activities as part of refranchising gains.

Initial fees in 1997 include $24 million of special KFC renewal fees.