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WYNDHAM WORLDWIDE CORP
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<div>
<div>
<table style="font-family: Arial,Helvetica; background: none transparent scroll repeat 0% 0%; color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%">
<tr valign="top"><td><b><font style="font-family: 'Times New Roman',Times;" class="_mt">11. Commitments and Contingencies</font></b> </td>
<td> </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The Company is involved in claims, legal proceedings and governmental inquiries related to the Company's business. </div>
<div style="margin-top: 12pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> Wyndham Worldwide Litigation</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The Company is involved in claims and legal actions arising in the ordinary course of its business including but not limited to: for its lodging business—breach of contract, fraud and bad faith claims between franchisors and franchisees in connection with franchise agreements and with owners in connection with management contracts, consumer protection and privacy claims, fraud and other statutory claims and negligence claims asserted in connection with alleged acts or occurrences at franchised or managed properties; for its vacation exchange and rentals business—breach of contract claims by both affiliates and members in connection with their respective agreements, bad faith, consumer protection, fraud and other statutory claims asserted by members and negligence claims by guests for alleged injuries sustained at resorts; for its vacation ownership business—breach of contract, bad faith, conflict of interest, fraud, consumer protection claims and other statutory claims by property owners' associations, owners and prospective owners in connection with the sale or use of VOIs, land or the management of vacation ownership resorts, construction defect claims relating to vacation ownership units or resorts and negligence claims by guests for alleged injuries sustained at vacation ownership units or resorts; and for each of its businesses, bankruptcy proceedings involving efforts to collect receivables from a debtor in bankruptcy, employment matters involving claims of discrimination, harassment and wage and hour claims, claims of infringement upon third parties' intellectual property rights, tax claims and environmental claims. </div></div>
<div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The Company believes that it has adequately accrued for such matters with reserves of $38 million as of June 30, 2010. Such amount is exclusive of matters relating to the Separation. For matters not requiring accrual, the Company believes that such matters will not have a material adverse effect on its results of operations, financial position or cash flows based on information currently available. However, litigation is inherently unpredictable and, although the Company believes that its accruals are adequate <font style="white-space: nowrap;" class="_mt">and/or</font> that it has valid defenses in these matters, unfavorable resolutions could occur. As such, an adverse outcome from such unresolved proceedings for which claims are awarded in excess of the amounts accrued, if any, could be material to the Company with respect to earnings or cash flows in any given reporting period. However, the Company does not believe that the impact of such unresolved litigation should result in a material liability to the Company in relation to its consolidated financial position or liquidity. </div>
<div style="margin-top: 12pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> Cendant Litigation</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">Under the Separation Agreement, the Company agreed to be responsible for 37.5% of certain of Cendant's contingent and other corporate liabilities and associated costs, including certain contingent litigation. Since the Company's separation from its former Parent ("Separation"), Cendant settled the majority of the lawsuits pending on the date of the Separation. See also Note 16—Separation Adjustments and Transactions with Former Parent and Subsidiaries regarding contingent litigation liabilities resulting from the Separation. </div>
<div style="margin-top: 12pt; font-size: 1pt;"> </div></div> </div>
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<table style="font-family: Arial,Helvetica; background: none transparent scroll repeat 0% 0%; color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%">
<tr valign="top"><td><b><font style="font-family: 'Times New Roman',Times;" class="_mt">12. Accumulated Other Comprehensive Income</font></b></td>
<td> </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The components of accumulated other comprehensive income as of June 30, 2010 are as follows: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 9pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="41%"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="11%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="1%"> </td>
<td width="1%" align="right"> </td>
<td width="11%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="11%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="1%"> </td>
<td width="1%" align="right"> </td>
<td width="11%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Unrealized<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Minimum<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Accumulated<br /></b></td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Currency<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Gains/(Losses)<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Pension<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Other<br /></b></td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Translation<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>on Cash Flow<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Liability<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Comprehensive<br /></b></td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Adjustments</b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Hedges, Net</b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Adjustment</b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Income</b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 9pt;">Balance, January 1, 2010, net of tax benefit of $32 </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">166 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">(27 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">(1 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">138 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 9pt;">Current period change </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(42 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">9 </td>
<td valign="bottom" nowrap="nowrap" align="left"><sup style="font-size: 85%; vertical-align: top;">(*)</sup> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(33 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 9pt;">Balance, June 30, 2010, net of tax benefit of $58 </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">124 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">(18 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">(1 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">105 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> <font style="white-space: nowrap; color: rgb(0,0,0); font-size: 1pt; word-spacing: 42pt;" class="_mt"><u>­ ­</u></font> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(*)</sup> </td>
<td align="left">Primarily represents the reclassification of an after-tax unrealized loss associated with the termination of an interest rate swap agreement in connection with the early extinguishment of the term loan facility (See Note 7—Long-Term Debt and Borrowing Arrangements). </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The components of accumulated other comprehensive income as of June 30, 2009 are as follows: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 9pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="41%"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="11%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="11%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="11%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="1%"> </td>
<td width="1%" align="right"> </td>
<td width="11%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 9pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Unrealized<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Minimum<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Accumulated<br /></b></td>
<td> </td></tr>
<tr style="font-size: 9pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Currency<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Gains/(Losses)<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Pension<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Other<br /></b></td>
<td> </td></tr>
<tr style="font-size: 9pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Translation<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>on Cash Flow<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Liability<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Comprehensive<br /></b></td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 9pt;" class="_mt">Adjustments</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 9pt;" class="_mt">Hedges, Net</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 9pt;" class="_mt">Adjustment</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 9pt;" class="_mt">Income</font></b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 9pt;">Balance, January 1, 2009, net of tax benefit of $72 </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">141 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">(45 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">2 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">98 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 9pt;">Current period change </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">29 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">13 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">42 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 9pt;">Balance, June 30, 2009, net of tax benefit of $32 </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">170 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">(32 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">2 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">140 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">Currency translation adjustments exclude income taxes related to investments in foreign subsidiaries where the Company intends to reinvest the undistributed earnings indefinitely in those foreign operations. </div> </div>
1583000000
769000000
1547000000
791000000
175000000
29000000
<div>
<div>
<table style="font-family: Arial,Helvetica; background: none transparent scroll repeat 0% 0%; color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%">
<tr valign="top"><td><b><font style="font-family: 'Times New Roman',Times;" class="_mt">7. Long-Term Debt and Borrowing Arrangements</font></b></td>
<td> </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The Company's indebtedness consisted of: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="70%"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>June 30,<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>December 31,<br /></b></td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">2010</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">2009</font></b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;"><i>Securitized vacation ownership debt:</i> <sup style="font-size: 85%; vertical-align: top;">(a)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Term notes </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,255 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,112 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Bank conduit facility <sup style="font-size: 85%; vertical-align: top;">(b)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">291 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">395 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Total securitized vacation ownership debt </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1,546 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1,507 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Less: Current portion of securitized vacation ownership debt </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">248 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">209 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Long-term securitized vacation ownership debt </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,298 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,298 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;"><i>Long-term debt:</i> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">6.00% senior unsecured notes (due December 2016) <sup style="font-size: 85%; vertical-align: top;">(c)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">798 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">797 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Term loan <sup style="font-size: 85%; vertical-align: top;">(d)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">300 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Revolving credit facility (due October 2013) <sup style="font-size: 85%; vertical-align: top;">(e)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">9.875% senior unsecured notes (due May 2014) <sup style="font-size: 85%; vertical-align: top;">(f)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">239 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">238 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">3.50% convertible notes (due May 2012) <sup style="font-size: 85%; vertical-align: top;">(g)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">362 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">367 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">7.375% senior unsecured notes (due March 2020) <sup style="font-size: 85%; vertical-align: top;">(h)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">247 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Vacation ownership bank borrowings <sup style="font-size: 85%; vertical-align: top;">(i)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">153 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Vacation rentals capital leases<sup style="font-size: 85%; vertical-align: top;">(j)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">110 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">133 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Other </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">36 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">27 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Total long-term debt </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1,792 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">2,015 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Less: Current portion of long-term debt </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">29 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">175 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Long-term debt </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,763 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,840 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> <font style="white-space: nowrap; color: rgb(0,0,0); font-size: 1pt; word-spacing: 42pt;" class="_mt"><u>­ ­</u></font> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(a)</sup> </td>
<td align="left">Represents debt that is securitized through bankruptcy remote special purpose entities ("SPEs"), the creditors of which have no recourse to the Company for principal and interest. </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(b)</sup> </td>
<td align="left">Represents a <font style="white-space: nowrap;" class="_mt">364-day,</font> $600 million, non-recourse vacation ownership bank conduit facility, with a term through October 2010 whose capacity is subject to the Company's ability to provide additional assets to collateralize the facility. As of June 30, 2010, the total available capacity of the facility was $309 million. </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(c)</sup> </td>
<td align="left">The balance as of June 30, 2010 represents $800 million aggregate principal less $2 million of unamortized discount. </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(d)</sup> </td>
<td align="left">The term loan facility was fully repaid during March 2010. </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(e)</sup> </td>
<td align="left">The revolving credit facility has a total capacity of $950 million, which includes availability for letters of credit. As of June 30, 2010, the Company had $31 million of letters of credit outstanding and, as such, the total available capacity of the revolving credit facility was $919 million. </td></tr></table>
<div style="margin-top: 3pt; font-size: 1pt;"> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(f)</sup> </td>
<td align="left">Represents senior unsecured notes issued by the Company during May 2009. The balance as of June 30, 2010 represents $250 million aggregate principal less $11 million of unamortized discount. </td></tr></table>
<div style="margin-top: 3pt; font-size: 1pt;"> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(g)</sup> </td>
<td align="left">Represents convertible notes issued by the Company during May 2009, which includes debt principal, less unamortized discount, and a liability related to a bifurcated conversion feature. The following table details the components of the convertible notes: </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="71%"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="11%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>June 30,<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>2010</b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>December 31, 2009</b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -8pt; margin-left: 8pt;">Debt principal </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">230 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">230 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -8pt; margin-left: 8pt;">Unamortized discount </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(31 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(39 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -8pt; margin-left: 8pt;">Debt less discount </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">199 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">191 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -8pt; margin-left: 8pt;">Fair value of bifurcated conversion feature <sup style="font-size: 85%; vertical-align: top;">(*)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">163 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">176 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -8pt; margin-left: 8pt;">Convertible notes </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">362 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">367 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 2%; font-size: 10pt; margin-right: 0%;" align="left"> <font style="white-space: nowrap; color: rgb(0,0,0); font-size: 1pt; word-spacing: 42pt;" class="_mt"><u>­ ­</u></font> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="7%"> </td>
<td width="3%"> </td>
<td width="90%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(*)</sup> </td>
<td align="left">The Company also has an asset with a fair value equal to the bifurcated conversion feature, which represents cash-settled call options that the Company purchased concurrent with the issuance of the convertible notes ("Bifurcated Conversion Feature"). </td></tr></table>
<div style="margin-top: 3pt; font-size: 1pt;"> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(h)</sup> </td>
<td align="left">Represents senior unsecured notes issued by the Company during February 2010. The balance at June 30, 2010 represents $250 million aggregate principal less $3 million of unamortized discount. </td></tr></table>
<div style="margin-top: 3pt; font-size: 1pt;"> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(i)</sup> </td>
<td align="left">Represents a <font style="white-space: nowrap;" class="_mt">364-day,</font> AUD 213 million, secured, revolving foreign credit facility, which was paid down and terminated during March 2010. </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(j)</sup> </td>
<td align="left">Represents capital lease obligations with corresponding assets classified within property and equipment on the Company's Consolidated Balance Sheets. </td></tr></table>
<div style="margin-top: 12pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> 2010 Debt Issuances</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left"><i>7.375% Senior Unsecured Notes.</i> On February 25, 2010, the Company issued senior unsecured notes, with face value of $250 million and bearing interest at a rate of 7.375%, for net proceeds of $247 million. Interest began accruing on February 25, 2010 and is payable semi-annually in arrears on March 1 and September 1 of each year, commencing on September 1, 2010. The notes will mature on March 1, 2020 and are redeemable at the Company's option at any time, in whole or in part, at the stated redemption prices plus accrued interest through the redemption date. These notes rank equally in right of payment with all of the Company's other senior unsecured indebtedness. </div></div>
<div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left"><i>Sierra Timeshare <font style="white-space: nowrap;" class="_mt">2010-1</font> Receivables Funding, LLC.</i> On March 12, 2010, the Company closed a series of term notes payable, Sierra Timeshare <font style="white-space: nowrap;" class="_mt">2010-1</font> Receivables Funding LLC, in the initial principal amount of $300 million. These borrowings bear interest at a coupon rate of 4.48% and are secured by vacation ownership contract receivables. As of June 30, 2010, the Company had $254 million of outstanding borrowings under these term notes. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left"><i>Revolving Credit Facility.</i> On March 29, 2010, the Company replaced its five-year $900 million revolving credit facility with a $950 million revolving credit facility that expires on October 1, 2013. This facility is subject to a fee of 50 basis points based on total capacity and bears interest at LIBOR plus 250 basis points. The interest rate of this facility is dependent on the Company's credit ratings. As of June 30, 2010, the Company had no outstanding borrowings and $31 million of outstanding letters of credit and, as such, the total available remaining capacity was $919 million. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left"><i>Premium Yield Facility <font style="white-space: nowrap;" class="_mt">2010-A</font> LLC.</i> On June 14, 2010, the Company closed a securitization facility, Premium Yield Facility <font style="white-space: nowrap;" class="_mt">2010-A</font> LLC, in the initial principal amount of $185 million. These borrowings bear interest at a coupon rate of 6.08% and are secured by vacation ownership contract receivables. As of June 30, 2010, the Company had $185 million of outstanding borrowings under this facility. </div>
<div style="margin-top: 12pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> 3.50% Convertible Notes</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">During May 2009, the Company issued convertible notes ("Convertible Notes") with face value of $230 million and bearing interest at a rate of 3.50%. Concurrent with such issuance, the Company purchased cash-settled call options ("Call Options") and entered into warrant transactions ("Warrants"). The agreements for such transactions contain anti-dilution provisions that require certain adjustments to be made as a result of all quarterly cash dividend increases above $0.04 per share that occur prior to the maturity date of the Convertible Notes, Call Options and Warrants. During March 2010, the Company increased its quarterly dividend from $0.04 per share to $0.12 per share. As a result of the dividend increase and required adjustments, as of June 30, 2010, the Convertible Notes have a conversion reference rate of 79.0908 shares of common stock per $1,000 principal amount (equivalent to a conversion price of approximately $12.64 per share of the Company's common stock), the conversion price of the Call Options is $12.64 and the exercise price of the Warrants is $20.02. </div>
<div style="margin-top: 12pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> Early Extinguishment of Debt</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">In connection with the early extinguishment of the term loan facility, the Company effectively terminated a related interest rate swap agreement, which resulted in the reclassification of a $14 million unrealized loss from accumulated other comprehensive income to interest expense during the first quarter of 2010 on the Company's Consolidated Statement of Income. The Company incurred an additional $2 million of costs during the first quarter of 2010 in connection with the early extinguishment of its term loan and revolving foreign credit facilities, which is also included within interest expense on the Company's Consolidated Statement of Income. The Company's revolving foreign credit facility was paid down with a portion of the proceeds from the 7.375% senior unsecured notes. The remaining proceeds were used, in addition to borrowings under the Company's revolving credit facility, to pay down the Company's term loan facility. </div>
<div style="margin-top: 12pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> Covenants</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The revolving credit facility is subject to covenants including the maintenance of specific financial ratios. The financial ratio covenants consist of a minimum consolidated interest coverage ratio of at least 3.0 to 1.0 as of the measurement date and a maximum consolidated leverage ratio not to exceed 3.75 to 1.0 on the measurement date. The consolidated interest coverage ratio is calculated by dividing Consolidated EBITDA (as defined in the credit agreement) by Consolidated Interest Expense (as defined in the credit agreement), both as measured on a trailing 12 month basis preceding the measurement date. As of June 30, 2010, the Company's consolidated interest coverage ratio was 6.9 times. Consolidated Interest Expense excludes, among other things, interest expense on any Securitization Indebtedness (as defined in the credit agreement). The consolidated leverage ratio is calculated by dividing Consolidated Total Indebtedness (as defined in the credit agreement and which excludes, among other things, Securitization Indebtedness) as of the measurement date by Consolidated EBITDA as measured on a trailing 12 month basis preceding the measurement date. As of June 30, 2010, the Company's consolidated leverage ratio was 1.8 times. Covenants in this credit facility also include limitations on indebtedness of material subsidiaries; liens; mergers, consolidations, liquidations and dissolutions; sale of all or substantially all assets; and sale and leaseback transactions. Events of default in this credit facility include failure to pay interest, principal and fees when due; breach of a covenant or warranty; acceleration of or failure to pay other debt in excess of $50 million (excluding Securitization Indebtedness); insolvency matters; and a change of control. </div></div>
<div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The 6.00% senior unsecured notes, 9.875% senior unsecured notes and 7.375% senior unsecured notes contain various covenants including limitations on liens, limitations on potential sale and leaseback transactions and change of control restrictions. In addition, there are limitations on mergers, consolidations and potential sale of all or substantially all of the Company's assets. Events of default in the notes include failure to pay interest and principal when due, breach of a covenant or warranty, acceleration of other debt in excess of $50 million and insolvency matters. The Convertible Notes do not contain affirmative or negative covenants; however, the limitations on mergers, consolidations and potential sale of all or substantially all of the Company's assets and the events of default for the Company's senior unsecured notes are applicable to such notes. Holders of the Convertible Notes have the right to require the Company to repurchase the Convertible Notes at 100% of principal plus accrued and unpaid interest in the event of a fundamental change, defined to include, among other things, a change of control, certain recapitalizations and if the Company's common stock is no longer listed on a national securities exchange. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">As of June 30, 2010, the Company was in compliance with all of the covenants described above. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">Each of the Company's non-recourse, securitized term notes and the bank conduit facility contain various triggers relating to the performance of the applicable loan pools. For example, if the vacation ownership contract receivables pool that collateralizes one of the Company's securitization notes fails to perform within the parameters established by the contractual triggers (such as higher default or delinquency rates), there are provisions pursuant to which the cash flows for that pool will be maintained in the securitization as extra collateral for the note holders or applied to accelerate the repayment of outstanding principal to the noteholders. As of June 30, 2010, all of the Company's securitized loan pools were in compliance with applicable contractual triggers. </div>
<div style="margin-top: 12pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> Maturities and Capacity</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The Company's outstanding debt as of June 30, 2010 matures as follows: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="56%"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Securitized<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Vacation<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Ownership<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">Debt</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">Other</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">Total</font></b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Within 1 year </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">248 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">29 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">277 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Between 1 and 2 years </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">385 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">372 </td>
<td valign="bottom" nowrap="nowrap" align="left"><sup style="font-size: 85%; vertical-align: top;">(*)</sup> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">757 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Between 2 and 3 years </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">192 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">25 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">217 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Between 3 and 4 years </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">188 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">249 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">437 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Between 4 and 5 years </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">164 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">10 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">174 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Thereafter </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">369 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1,107 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1,476 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,546 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,792 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">3,338 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> <font style="white-space: nowrap; color: rgb(0,0,0); font-size: 1pt; word-spacing: 42pt;" class="_mt"><u>­ ­</u></font> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(*)</sup> </td>
<td align="left">Includes a liability of $163 million related to the Bifurcated Conversion Feature associated with the Company's Convertible Notes. </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">As debt maturities of the securitized vacation ownership debt are based on the contractual payment terms of the underlying vacation ownership contract receivables, actual maturities may differ as a result of prepayments by the vacation ownership contract receivable obligors. <br /></div></div>
<p> </p>
<div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"> </div>
<div style="margin-top: 0pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">As of June 30, 2010, available capacity under the Company's borrowing arrangements was as follows: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="61%"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="9%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="9%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="9%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Total<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Outstanding<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Available<br /></b></td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">Capacity</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">Borrowings</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">Capacity</font></b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;"><i>Securitized vacation ownership debt:</i> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Term notes </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,255 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,255 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Bank conduit facility <sup style="font-size: 85%; vertical-align: top;">(a)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">600 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">291 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">309 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Total securitized vacation ownership debt <sup style="font-size: 85%; vertical-align: top;">(b)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,855 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,546 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">309 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;"><i>Long-term debt:</i> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">6.00% senior unsecured notes (due December 2016) </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">798 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">798 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Revolving credit facility (due October 2013) <sup style="font-size: 85%; vertical-align: top;">(c)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">950 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">950 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">9.875% senior unsecured notes (due May 2014) </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">239 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">239 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">3.50% convertible notes (due May 2012) </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">362 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">362 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">7.375% senior unsecured notes (due March 2020) </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">247 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">247 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Vacation rentals capital leases </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">110 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">110 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Other </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">51 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">36 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">15 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Total long-term debt </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">2,757 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,792 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">965 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Less: Issuance of letters of credit <sup style="font-size: 85%; vertical-align: top;">(c)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">31 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">934 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> <font style="white-space: nowrap; color: rgb(0,0,0); font-size: 1pt; word-spacing: 42pt;" class="_mt"><u>­ ­</u></font> </div><font style="font-size: 8pt;" class="_mt"> </font><font style="font-size: 8pt;" class="_mt"> </font>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(a)</sup> </td>
<td align="left">The capacity of this facility is subject to the Company's ability to provide additional assets to collateralize additional securitized borrowings. </td></tr>
<tr style="line-height: 6pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(b)</sup> </td>
<td align="left">These outstanding borrowings are collateralized by $2,862 million of underlying gross vacation ownership contract receivables and related assets. </td></tr>
<tr style="line-height: 6pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(c)</sup> </td>
<td align="left">The capacity under the Company's revolving credit facility includes availability for letters of credit. As of June 30, 2010, the available capacity of $950 million was reduced by $31 million for the issuance of letters of credit. </td></tr></table>
<div style="margin-top: 12pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> Vacation Ownership Contract Receivables and Securitizations</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The Company pools qualifying vacation ownership contract receivables and sells them to bankruptcy-remote entities. Vacation ownership contract receivables qualify for securitization based primarily on the credit strength of the VOI purchaser to whom financing has been extended. Vacation ownership contract receivables are securitized through bankruptcy-remote SPEs that are consolidated within the Company's Consolidated Financial Statements. As a result, the Company does not recognize gains or losses resulting from these securitizations at the time of sale to the SPEs. Income is recognized when earned over the contractual life of the vacation ownership contract receivables. The Company services the securitized vacation ownership contract receivables pursuant to servicing agreements negotiated on an arms-length basis based on market conditions. The activities of these SPEs are limited to (i) purchasing vacation ownership contract receivables from the Company's vacation ownership subsidiaries; (ii) issuing debt securities <font style="white-space: nowrap;" class="_mt">and/or</font> borrowing under a conduit facility to fund such purchases; and (iii) entering into derivatives to hedge interest rate exposure. The assets of these bankruptcy-remote SPEs are not available to pay the Company's general obligations. Additionally, the creditors of these SPEs have no recourse to the Company for principal and interest. </div></div>
<p> </p>
<div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"> </div>
<div style="margin-top: 0pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The assets and liabilities of these vacation ownership SPEs are as follows: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="70%"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>June 30,<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>December 31,<br /></b></td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">2010</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">2009</font></b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Securitized contract receivables, gross <sup style="font-size: 85%; vertical-align: top;">(a)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">2,684 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">2,591 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Securitized restricted cash <sup style="font-size: 85%; vertical-align: top;">(b)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">153 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">133 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Interest receivables on securitized contract receivables <sup style="font-size: 85%; vertical-align: top;">(c)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">21 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">20 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Other assets <sup style="font-size: 85%; vertical-align: top;">(d)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">4 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">11 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Total SPE assets <sup style="font-size: 85%; vertical-align: top;">(e)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">2,862 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">2,755 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr style="line-height: 9pt;" valign="bottom"><td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Securitized term notes <sup style="font-size: 85%; vertical-align: top;">(f)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1,255 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1,112 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Securitized conduit facilities <sup style="font-size: 85%; vertical-align: top;">(f)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">291 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">395 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Other liabilities <sup style="font-size: 85%; vertical-align: top;">(g)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">26 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">26 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Total SPE liabilities </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1,572 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1,533 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr style="line-height: 9pt;" valign="bottom"><td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">SPE assets in excess of SPE liabilities </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,290 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,222 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;"> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> <font style="white-space: nowrap; color: rgb(0,0,0); font-size: 1pt; word-spacing: 42pt;" class="_mt"><u>­ ­</u></font> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(a)</sup> </td>
<td align="left">Included in current ($259 million and $244 million as of June 30, 2010 and December 31, 2009, respectively) and non-current ($2,425 million and $2,347 million as of June 30, 2010 and December 31, 2009, respectively) vacation ownership contract receivables on the Company's Consolidated Balance Sheets. </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(b)</sup> </td>
<td align="left">Included in other current assets ($91 million and $69 million as of June 30, 2010 and December 31, 2009, respectively) and other non-current assets ($62 million and $64 million as of June 30, 2010 and December 31, 2009, respectively) on the Company's Consolidated Balance Sheets. </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(c)</sup> </td>
<td align="left">Included in trade receivables, net on the Company's Consolidated Balance Sheets. </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(d)</sup> </td>
<td align="left">Primarily includes interest rate derivative contracts and related assets; included in other non-current assets on the Company's Consolidated Balance Sheets. </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(e)</sup> </td>
<td align="left">Excludes deferred financing costs of $18 million and $20 million as of June 30, 2010 and December 31, 2009, respectively, related to securitized debt. </td></tr></table>
<div style="margin-top: 3pt; font-size: 1pt;"> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(f)</sup> </td>
<td align="left">Included in current ($248 million and $209 million as of June 30, 2010 and December 31, 2009, respectively) and long-term ($1,298 million as of both June 30, 2010 and December 31, 2009) securitized vacation ownership debt on the Company's Consolidated Balance Sheets. </td></tr></table>
<div style="margin-top: 3pt; font-size: 1pt;"> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(g)</sup> </td>
<td align="left">Primarily includes interest rate derivative contracts and accrued interest on securitized debt; included in accrued expenses and other current liabilities ($4 million as of both June 30, 2010 and December 31, 2009) and other non-current liabilities ($22 million and $23 million as of June 30, 2010 and December 31, 2009, respectively) on the Company's Consolidated Balance Sheets. </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">In addition, the Company has vacation ownership contract receivables that have not been securitized through bankruptcy-remote SPEs. Such gross receivables were $659 million and $860 million as of June 30, 2010 and December 31, 2009, respectively. A summary of such receivables and total vacation ownership SPE assets in excess of SPE liabilities and net of the allowance for loan losses, is as follows: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="70%"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>June 30,<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>December 31,<br /></b></td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">2010</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">2009</font></b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">SPE assets in excess of SPE liabilities </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,290 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,222 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Non-securitized contract receivables </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">659 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">598 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Secured contract receivables <sup style="font-size: 85%; vertical-align: top;">(*)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">262 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Allowance for loan losses </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(358 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(370 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Total, net </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,591 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,712 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> <font style="white-space: nowrap; color: rgb(0,0,0); font-size: 1pt; word-spacing: 42pt;" class="_mt"><u>­ ­</u></font> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(*)</sup> </td>
<td align="left">As of December 31, 2009, such receivables collateralized the Company's secured, revolving foreign credit facility, which was paid down and terminated during March 2010. </td></tr></table>
<div style="margin-top: 12pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> Interest Expense</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">Interest expense incurred in connection with the Company's non-securitized debt was $37 million and $72 million during the three and six months ended June 30, 2010, respectively, and $28 million and $50 million during the three and six months ended June 30, 2009, respectively. Additionally, in connection with the early extinguishment of the term loan facility, the Company effectively terminated a related interest rate swap agreement, which resulted in the reclassification of a $14 million unrealized loss from accumulated other comprehensive income to interest expense during the six months ended June 30, 2010. The Company also recorded an additional $2 million of costs during the first quarter of 2010 in connection with the early extinguishment of its term loan and revolving foreign credit facilities, which was also included within interest expense during the six months ended June 30, 2010. Cash paid related to such interest expense was $60 million and $44 million during the six months ended June 30, 2010 and 2009, respectively. </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left"> </div></div>
<div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">Interest expense is partially offset on the Consolidated Statements of Income by capitalized interest of $1 million and $2 million during the three and six months ended June 30, 2010, respectively, and $2 million and $5 million during the three and six months ended June 30, 2009, respectively. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">Cash paid related to consumer financing interest expense was $33 million and $55 million during the six months ended June 30, 2010 and 2009, respectively. </div></div> </div>
51000000
41000000
417000000
422000000
267000000
241000000
189000000
156000000
1137000000
1127000000
88000000
45000000
85000000
42000000
<div>
<div>
<table style="font-family: Arial,Helvetica; background: none transparent scroll repeat 0% 0%; color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%">
<tr valign="top"><td><b><font style="font-family: 'Times New Roman',Times;" class="_mt">9.</font></b></td>
<td><b><font style="font-family: 'Times New Roman',Times;" class="_mt">Derivative Instruments and Hedging Activities</font></b> </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> Foreign Currency Risk</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The Company uses freestanding foreign currency forward contracts and foreign currency forward contracts designated as cash flow hedges to manage its exposure to changes in foreign currency exchange rates associated with its foreign currency denominated receivables, forecasted earnings of foreign subsidiaries and forecasted foreign currency denominated vendor payments. The Company primarily hedges its foreign currency exposure to the British pound and Euro. The impact of the cash flow hedges did not have a material impact on the Company's results of operations, financial position and cash flows during the three months ended June 30, 2010. The fluctuations in the value of the freestanding forward contracts do, however, largely offset the impact of changes in the value of the underlying risk that they are intended to hedge. The impact of the freestanding forward contracts was a gain of $5 million and a loss of $3 million, which were included in operating expense on the Company's Consolidated Statements of Income during the three and six months ended June 30, 2010, respectively. The impact of the freestanding forward contracts was a gain of $12 million and $10 million, which were included in operating expense on the Company's Consolidated Statements of Income during three and six months ended June 30, 2009. The impact of the freestanding forward contracts was not material to the Company's financial position or cash flows during the three and six months ended June 30, 2010 and 2009. The pre-tax amount of gains or losses reclassified from other comprehensive income to earnings resulting from ineffectiveness or from excluding a component of the forward contracts' gain or loss from the effectiveness calculation for cash flow hedges during the three and six months ended June 30, 2010 and 2009 was not material. The amount of gains or losses the Company expects to reclassify from other comprehensive income to earnings over the next 12 months is not material. </div></div>
<div>
<div style="margin-top: 12pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> Interest Rate Risk</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">A portion of the debt used to finance the Company's operations is also exposed to interest rate fluctuations. The Company uses various hedging strategies and derivative financial instruments to create a desired mix of fixed and floating rate assets and liabilities. Derivative instruments currently used in these hedging strategies include swaps and interest rate caps. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The derivatives used to manage the risk associated with the Company's floating rate debt include freestanding derivatives and derivatives designated as cash flow hedges. In connection with its qualifying cash flow hedges, the Company recorded a net pre-tax gain of $3 million and $2 million during the three and six months ended June 30, 2010, respectively, and a net pre-tax gain of $14 million and $20 million during the three and six months ended June 30, 2009, respectively, to other comprehensive income. The pre-tax amount of gains or losses reclassified from other comprehensive income to consumer financing interest or interest expense resulting from ineffectiveness or from excluding a component of the derivatives' gain or loss from the effectiveness calculation for cash flow hedges was insignificant during the three and six months ended June 30, 2010 and 2009. In connection with the early extinguishment of the term loan facility (See Note 7—Long-Term Debt and Borrowing Arrangements), the Company effectively terminated the interest rate swap agreement, which resulted in the reclassification of a $14 million unrealized loss from accumulated other comprehensive income to interest expense on the Company's Consolidated Statement of Income during the six months ended June 30, 2010. The amount of losses that the Company expects to reclassify from other comprehensive income to earnings during the next 12 months is not material. The impact of the freestanding derivatives was a gain of $4 million and $7 million (of which $1 million and $4 million were included in consumer financing interest expense and $3 million and $3 million were included in interest expense) on the Company's Consolidated Statements of Income during the three and six months ended June 30, 2010, respectively, and a gain of $1 million and $3 million included in consumer financing interest expense on the Company's Consolidated Statements of Income during the three and six months ended June 30, 2009, respectively. The freestanding derivatives had an immaterial impact on the Company's financial position and cash flows during the three and six months ended June 30, 2010 and 2009. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The following table summarizes information regarding the Company's derivative instruments as of June 30, 2010: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 9pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="35%"> </td>
<td width="1%"> </td>
<td width="18%"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="5%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="2%"> </td>
<td width="26%"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="5%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="4" align="center"><b>Assets</b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="4" align="center"><b>Liabilities</b> </td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" nowrap="nowrap" align="center"><b>Balance Sheet Location</b> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Fair Value</b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" nowrap="nowrap" align="center"><b>Balance Sheet Location</b> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Fair Value</b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 9pt;"><b>Derivatives designated as hedging instruments</b> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 27pt;">Interest rate contracts </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" align="left">Other non-current liabilities </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">22 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 9pt;"><b>Derivatives not designated as hedging instruments</b> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 27pt;">Interest rate contracts </div></td>
<td> </td>
<td valign="bottom" align="left">Other non-current assets </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">6 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" align="left">Other non-current liabilities </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">15 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 27pt;">Foreign exchange contracts </div></td>
<td> </td>
<td valign="bottom" align="left">Other current assets </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">14 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" align="left">Accrued exp. & other current liabs. </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">10 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 27pt;">Convertible Notes related<br />Call Options <sup style="font-size: 85%; vertical-align: top;">(*)</sup> </div></td>
<td> </td>
<td valign="bottom" align="left">Other non-current assets </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">163 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 27pt;">Bifurcated Conversion Feature <sup style="font-size: 85%; vertical-align: top;">(*)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">Long-term debt </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">163 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 9pt;"><b>Total derivatives not designated as hedging instruments</b> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">183 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">188 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> <font style="white-space: nowrap; color: rgb(0,0,0); font-size: 1pt; word-spacing: 42pt;" class="_mt"><u>­ ­</u></font> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(*)</sup> </td>
<td align="left">See Note 7—Long-Term Debt and Borrowing Arrangements for further detail. </td></tr></table>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"> </div></div>
<div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The following table summarizes information regarding the Company's derivative instruments as of December 31, 2009: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 9pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="35%"> </td>
<td width="1%"> </td>
<td width="18%"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="5%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="2%"> </td>
<td width="26%"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="5%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="4" align="center"><b>Assets</b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="4" align="center"><b>Liabilities</b> </td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" nowrap="nowrap" align="center"><b>Balance Sheet Location</b> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Fair Value</b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" nowrap="nowrap" align="center"><b>Balance Sheet Location</b> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Fair Value</b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 9pt;"><b>Derivatives designated as hedging instruments</b> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 27pt;">Interest rate contracts </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" align="left">Other non-current liabilities </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">39 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 9pt;"><b>Derivatives not designated as hedging instruments</b> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 27pt;">Interest rate contracts </div></td>
<td> </td>
<td valign="bottom" align="left">Other non-current assets </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">5 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" align="left">Other non-current liabilities </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">6 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 27pt;">Foreign exchange contracts </div></td>
<td> </td>
<td valign="bottom" align="left">Other current assets </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">3 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" align="left">Accrued exp. & other current liabs. </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">2 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 27pt;">Convertible Notes related<br />Call Options <sup style="font-size: 85%; vertical-align: top;">(*)</sup> </div></td>
<td> </td>
<td valign="bottom" align="left">Other non-current assets </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">176 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 27pt;">Bifurcated Conversion Feature <sup style="font-size: 85%; vertical-align: top;">(*)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">Long-term debt </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">176 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 9pt;"><b>Total derivatives not designated as hedging instruments</b> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">184 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">184 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> <font style="white-space: nowrap; color: rgb(0,0,0); font-size: 1pt; word-spacing: 42pt;" class="_mt"><u>­ ­</u></font> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(*)</sup> </td>
<td align="left">See Note 7—Long-Term Debt and Borrowing Arrangements for further detail. </td></tr></table>
<div style="margin-top: 12pt; font-size: 1pt;"> </div></div> </div>
<div>
<div>
<table style="font-family: Arial,Helvetica; background: none transparent scroll repeat 0% 0%; color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%">
<tr valign="top"><td><b><font style="font-family: 'Times New Roman',Times;" class="_mt">13. Stock-Based Compensation</font></b> </td>
<td> </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The Company has a stock-based compensation plan available to grant non-qualified stock options, incentive stock options, SSARs, restricted stock, RSUs and other stock or cash-based awards to key employees, non-employee directors, advisors and consultants. Under the Wyndham Worldwide Corporation 2006 Equity and Incentive Plan, which was amended and restated as a result of shareholders' approval at the May 12, 2009 annual meeting of shareholders, a maximum of 36.7 million shares of common stock may be awarded. As of June 30, 2010, 14.6 million shares remained available. </div></div>
<p> </p>
<div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"> </div>
<div style="margin-top: 0pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> Incentive Equity Awards Granted by the Company</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The activity related to incentive equity awards granted by the Company for the six months ended June 30, 2010 consisted of the following: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 5%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="95%">
<tr style="font-size: 1pt;" valign="bottom"><td width="37%"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="11%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="11%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="11%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="11%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="6" align="center"><b>RSUs</b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="6" align="center"><b>SSARs</b> </td>
<td> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Weighted<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Weighted<br /></b></td>
<td> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Number<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Average<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Number<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Average<br /></b></td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">of RSUs</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">Grant Price</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">of SSARs</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">Exercise Price</font></b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Balance as of January 1, 2010 </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">8.3 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">9.60 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">2.1 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">21.70 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Granted </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1.9 </td>
<td valign="bottom" nowrap="nowrap" align="left"><sup style="font-size: 85%; vertical-align: top;">(b)</sup> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">22.85 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">0.2 </td>
<td valign="bottom" nowrap="nowrap" align="left"><sup style="font-size: 85%; vertical-align: top;">(b)</sup> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">22.84 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Vested/exercised </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(2.8 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">11.63 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Canceled </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(0.3 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">11.04 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Balance as of June 30, 2010<sup style="font-size: 85%; vertical-align: top;"> (a)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">7.1 </td>
<td valign="bottom" nowrap="nowrap" align="left"><sup style="font-size: 85%; vertical-align: top;">(c)</sup> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">12.21 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">2.3 </td>
<td valign="bottom" nowrap="nowrap" align="left"><sup style="font-size: 85%; vertical-align: top;">(d)</sup> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">21.77 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> <font style="white-space: nowrap; color: rgb(0,0,0); font-size: 1pt; word-spacing: 42pt;" class="_mt"><u>­ ­</u></font> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(a)</sup> </td>
<td align="left">Aggregate unrecognized compensation expense related to SSARs and RSUs was $81 million as of June 30, 2010 which is expected to be recognized over a weighted average period of 2.7 years. </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(b)</sup> </td>
<td align="left">Primarily represents awards granted by the Company on February 24, 2010. </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(c)</sup> </td>
<td align="left">Approximately 6.7 million RSUs outstanding as of June 30, 2010 are expected to vest over time. </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(d)</sup> </td>
<td align="left">Approximately 1.3 million of the 2.3 million SSARs are exercisable as of June 30, 2010. The Company assumes that all unvested SSARs are expected to vest over time. SSARs outstanding as of June 30, 2010 had an intrinsic value of $10 million and have a weighted average remaining contractual life of 3.9 years. </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">On February 24, 2010, the Company approved grants of incentive equity awards totaling $43 million to key employees and senior officers of Wyndham in the form of RSUs and SSARs. These awards will vest ratably over a period of four years. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The fair value of SSARs granted by the Company on February 24, 2010 was estimated on the date of grant using the Black-Scholes option-pricing model with the relevant weighted average assumptions outlined in the table below. Expected volatility is based on both historical and implied volatilities of (i) the Company's stock and (ii) the stock of comparable companies over the estimated expected life of the SSARs. The expected life represents the period of time the SSARs are expected to be outstanding and is based on the "simplified method," as defined in Staff Accounting Bulletin 110. The risk free interest rate is based on yields on U.S. Treasury strips with a maturity similar to the estimated expected life of the SSARs. The projected dividend yield was based on the Company's anticipated annual dividend divided by the twelve-month target price of the Company's stock on the date of the grant. </div>
<div style="margin-top: 12pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="83%"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="13%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>SSARs Issued on<br /></b></td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">February 24, 2010</font></b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Grant date fair value </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">8.66 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Grant date strike price </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">22.84 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Expected volatility </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">53.0% </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Expected life </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">4.25 yrs. </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Risk free interest rate </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">2.07% </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Projected dividend yield </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">2.10% </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="margin-top: 12pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> Stock-Based Compensation Expense</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The Company recorded stock-based compensation expense of $10 million and $20 million during the three and six months ended June 30, 2010, respectively, and $11 million and $18 million during the three and six months ended June 30, 2009, respectively, related to the incentive equity awards granted by the Company. The Company recognized $4 million and $8 million of a net tax benefit during the three and six months ended June 30, 2010, respectively, for stock-based compensation arrangements on the Consolidated Statements of Income. The Company recognized less than $1 million of a net tax detriment and $3 million of a net tax benefit during the three and six months ended June 30, 2009, respectively, for stock-based compensation arrangements on the Consolidated Statements of Income. During the six months ended June 30, 2010, the Company increased its pool of excess tax benefits available to absorb tax deficiencies ("APIC Pool") by $10 million due to the vesting of RSUs and exercise of stock options. During March 2009, the Company utilized its APIC Pool related to the vesting of RSUs, which reduced the balance to $0. During May 2009, the Company recorded a $4 million charge to its provision for income taxes related to additional vesting of RSUs. As of December 31, 2009, the Company's APIC Pool balance was $0. </div></div>
<p> </p>
<div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"> </div>
<div style="margin-top: 0pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> Incentive Equity Awards</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">Prior to August 1, 2006, all employee stock awards (stock options and RSUs) were granted by Cendant. At the time of Separation, a portion of Cendant's outstanding equity awards were converted into equity awards of the Company at a ratio of one share of the Company's common stock for every five shares of Cendant's common stock. As a result, the Company issued approximately 2 million RSUs and approximately 24 million stock options upon completion of the conversion of existing Cendant equity awards into Wyndham equity awards. As of June 30, 2010, there were 4.3 million converted stock options and no converted RSUs outstanding. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">As of June 30, 2010, the 4.3 million converted stock options outstanding had a weighted average exercise price of $31.13 a weighted average remaining contractual life of 1.2 years and all 4.3 million options were exercisable. There were 1.5 million outstanding <font style="white-space: nowrap;" class="_mt">"in-the-money"</font> stock options, which had an aggregate intrinsic value of $500,000. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The Company withheld $22 million of taxes for the net share settlement of incentive equity awards during the six months ended June 30, 2010. Such amount is included in other, net within financing activities on the Consolidated Statement of Cash Flows. </div></div> </div>
-15000000
-15000000
-45000000
-45000000
245000000
246000000
63000000
62000000
0.65
0.4
0.81
0.53
0.64
0.39
0.78
0.51
<div>
<div>
<table style="font-family: Arial,Helvetica; background: none transparent scroll repeat 0% 0%; color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%">
<tr valign="top"><td><b><font style="font-family: 'Times New Roman',Times;" class="_mt">2. Earnings Per Share</font></b> </td>
<td> </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The computation of basic and diluted earnings per share ("EPS") is based on the Company's net income available to common stockholders divided by the basic weighted average number of common shares and diluted weighted average number of common shares, respectively. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The following table sets forth the computation of basic and diluted EPS (in millions, except per share data): </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="52%"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="8%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="8%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="8%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="8%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="6" nowrap="nowrap" align="center"><b>Three Months Ended<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="6" nowrap="nowrap" align="center"><b>Six Months Ended<br /></b></td>
<td> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="6" nowrap="nowrap" align="center"><b>June 30,</b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="6" nowrap="nowrap" align="center"><b>June 30,</b> </td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">2010</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">2009</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">2010</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">2009</font></b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Net income </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">95 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">71 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">145 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">116 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Basic weighted average shares outstanding </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">180 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">179 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">180 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">178 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Stock options and restricted stock units ("RSU") </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">4 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">3 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">3 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">2 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Warrants <sup style="font-size: 85%; vertical-align: top;">(*)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">3 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">3 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Diluted weighted average shares outstanding </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">187 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">182 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">186 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">180 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;"><i>Earnings per share:</i> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Basic </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">0.53 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">0.40 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">0.81 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">0.65 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Diluted </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">0.51 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">0.39 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">0.78 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">0.64 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> <font style="white-space: nowrap; color: rgb(0,0,0); font-size: 1pt; word-spacing: 42pt;" class="_mt"><u>­ ­</u></font> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(*)</sup> </td>
<td align="left">Represents the dilutive effect of warrants to purchase shares of the Company's common stock related to the May 2009 issuance of the Company's convertible notes (see Note 7—Long-Term Debt and Borrowing Arrangements). </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The computations of diluted EPS for both the three and six months ended June 30, 2010 do not include approximately 4 million stock options and stock-settled stock appreciation rights ("SSARs") as the effect of their inclusion would have been anti-dilutive to EPS. The computations of diluted EPS for both the three and six months ended June 30, 2009 do not include warrants to purchase approximately 18 million shares of the Company's common stock related to the May 2009 issuance of the Company's Convertible Notes (see Note 7—Long-Term Debt and Borrowing Arrangements) and approximately 10 million stock options and SSARs as the effect of their inclusion would have been anti-dilutive to EPS. </div>
<div style="margin-top: 12pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> Dividend Payments</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">During each of the quarterly periods ended March 31 and June 30, 2010, the Company paid cash dividends of $0.12 per share ($44 million in the aggregate). During each of the quarterly periods ended March 31 and June 30, 2009, the Company paid cash dividends of $0.04 per share ($15 million in the aggregate). </div></div>
<p> </p>
<div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"> </div>
<div style="margin-top: 0pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> Stock Repurchase Program</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">On August 20, 2007, the Company's Board of Directors authorized a stock repurchase program that enables it to purchase up to $200 million of its common stock. Under such program, the Company repurchased 2,155,783 shares at an average price of $26.89 for a cost of $58 million and repurchase capacity increased $13 million from proceeds received from stock option exercises as of December 31, 2009. During the six months ended June 30, 2010, the Company repurchased 2,912,093 shares at an average price of $24.29 for a cost of $71 million and repurchase capacity increased $16 million from proceeds received from stock option exercises. As of June 30, 2010, the Company had $100 million remaining availability in its program. </div></div> </div>
11000000
-7000000
0
13000000
0
13000000
797000000
397000000
833000000
409000000
<div>
<div>
<table style="font-family: Arial,Helvetica; background: none transparent scroll repeat 0% 0%; color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%">
<tr valign="top"><td><b><font style="font-family: 'Times New Roman',Times;" class="_mt">8. Fair Value</font></b> </td>
<td> </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The guidance for fair value measurements requires disclosures about the Company's assets and liabilities that are measured at fair value. The following table presents information about the Company's financial assets and liabilities that are measured at fair value on a recurring basis as of June 30, 2010, and indicates the fair value hierarchy of the valuation techniques utilized by the Company to determine such fair values. Financial assets and liabilities carried at fair value are classified and disclosed in one of the following three categories: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">Level 1: Quoted prices for identical instruments in active markets. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">Level 2: Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value driver is observable. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">Level 3: Unobservable inputs used when little or no market data is available. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement falls has been determined based on the lowest level input (closest to Level 3) that is significant to the fair value measurement. The Company's assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="53%"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="11%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="11%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="11%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="6" nowrap="nowrap" align="center"><b>Fair Value Measure on a<br /></b></td>
<td> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="6" nowrap="nowrap" align="center"><b>Recurring Basis</b> </td>
<td> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Significant<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Significant<br /></b></td>
<td> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>As of<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Other<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Unobservable<br /></b></td>
<td> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>June 30,<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Observable<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Inputs<br /></b></td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">2010</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">Inputs (Level 2)</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">(Level 3)</font></b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Assets: </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Derivatives <sup style="font-size: 85%; vertical-align: top;">(a)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Convertible Notes related Call Options </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">163 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">163 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Interest rate contracts </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">6 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">6 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Foreign exchange contracts </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">14 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">14 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Securities <font style="white-space: nowrap;" class="_mt">available-for-sale</font> <sup style="font-size: 85%; vertical-align: top;">(b)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">5 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">5 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Total assets </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">188 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">20 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">168 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Liabilities: </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Derivatives <sup style="font-size: 85%; vertical-align: top;">(c)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Bifurcated Conversion Feature </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">163 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">163 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Interest rate contracts </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">37 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">37 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Foreign exchange contracts </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">10 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">10 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Total liabilities </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">210 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">47 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">163 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> <font style="white-space: nowrap; color: rgb(0,0,0); font-size: 1pt; word-spacing: 42pt;" class="_mt"><u>­ ­</u></font> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(a)</sup> </td>
<td align="left">Included in other current assets and other non-current assets on the Company's Consolidated Balance Sheet. </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(b)</sup> </td>
<td align="left">Included in other non-current assets on the Company's Consolidated Balance Sheet. </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(c)</sup> </td>
<td align="left">Included in long-term debt, accrued expenses and other current liabilities and other non-current liabilities on the Company's Consolidated Balance Sheet. </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The Company's derivative instruments primarily consist of the Call Options and Bifurcated Conversion Feature related to the Convertible Notes, pay-fixed/receive-variable interest rate swaps, interest rate caps, foreign exchange forward contracts and foreign exchange average rate forward contracts (see Note 9—Derivative Instruments and Hedging Activities for more detail). For assets and liabilities that are measured using quoted prices in active markets, the fair value is the published market price per unit multiplied by the number of units held without consideration of transaction costs. Assets and liabilities that are measured using other significant observable inputs are valued by reference to similar assets and liabilities. For these items, a significant portion of fair value is derived by reference to quoted prices of similar assets and liabilities in active markets. For assets and liabilities that are measured using significant unobservable inputs, fair value is derived using a fair value model, such as a discounted cash flow model. </div></div>
<div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The following table presents additional information about financial assets which are measured at fair value on a recurring basis for which the Company has utilized Level 3 inputs to determine fair value as of June 30, 2010: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="53%"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="11%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="11%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="11%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="10" nowrap="nowrap" align="center"><b>Fair Value Measurements Using<br /></b></td>
<td> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="10" nowrap="nowrap" align="center"><b>Significant Unobservable Inputs (Level 3)</b> </td>
<td> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Derivative<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Liability-<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Derivative<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Bifurcated<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Securities<br /></b></td>
<td> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Asset-Call<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Conversion<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Available-For-<br /></b></td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">Options</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">Feature</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">Sale</font></b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Balance as of January 1, 2010 </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">176 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">(176 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">5 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Change in fair value </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(13 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">13 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Balance as of June 30, 2010 </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">163 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">(163 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">5 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The fair value of financial instruments is generally determined by reference to market values resulting from trading on a national securities exchange or in an <font style="white-space: nowrap;" class="_mt">over-the-counter</font> market. In cases where quoted market prices are not available, fair value is based on estimates using present value or other valuation techniques, as appropriate. The carrying amounts of cash and cash equivalents, restricted cash, trade receivables, accounts payable and accrued expenses and other current liabilities approximate fair value due to the short-term maturities of these assets and liabilities. The carrying amounts and estimated fair values of all other financial instruments are as follows: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="45%"> </td>
<td width="2%"> </td>
<td width="5%" align="right"> </td>
<td width="1%" align="right"> </td>
<td width="5%" align="left"> </td>
<td width="3%"> </td>
<td width="5%" align="right"> </td>
<td width="1%" align="right"> </td>
<td width="5%" align="left"> </td>
<td width="3%"> </td>
<td width="5%" align="right"> </td>
<td width="1%" align="right"> </td>
<td width="5%" align="left"> </td>
<td width="3%"> </td>
<td width="5%" align="right"> </td>
<td width="1%" align="right"> </td>
<td width="5%" align="left"> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="7" align="center"><b>June 30, 2010</b> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="7" align="center"><b>December 31, 2009</b> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="3" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="3" nowrap="nowrap" align="center"><b>Estimated<br /></b></td>
<td> </td>
<td valign="bottom" colspan="3" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="3" nowrap="nowrap" align="center"><b>Estimated<br /></b></td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="3" nowrap="nowrap" align="center"><b>Carrying<br /></b></td>
<td> </td>
<td valign="bottom" colspan="3" nowrap="nowrap" align="center"><b>Fair<br /></b></td>
<td> </td>
<td valign="bottom" colspan="3" nowrap="nowrap" align="center"><b>Carrying<br /></b></td>
<td> </td>
<td valign="bottom" colspan="3" nowrap="nowrap" align="center"><b>Fair<br /></b></td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="3" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">Amount</font></b> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="3" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">Value</font></b> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="3" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">Amount</font></b> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="3" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">Value</font></b> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;"><b>Assets</b> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Vacation ownership contract receivables, net </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">2,985 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">2,794 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">3,081 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">2,809 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;"><b>Debt</b> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Total debt <sup style="font-size: 85%; vertical-align: top;">(a)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">3,338 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">3,340 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">3,522 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">3,405 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;"><b>Derivatives</b> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Foreign exchange contracts <sup style="font-size: 85%; vertical-align: top;">(b)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 30pt;">Assets </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">14 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">14 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">3 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">3 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 30pt;">Liabilities </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(10 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(10 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(2 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(2 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Interest rate contracts <sup style="font-size: 85%; vertical-align: top;">(c)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 30pt;">Assets </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">6 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">6 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">5 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">5 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 30pt;">Liabilities </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(37 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(37 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(45 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(45 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Convertible Notes related Call Options </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 30pt;">Assets </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">163 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">163 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">176 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="right">176 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> <font style="white-space: nowrap; color: rgb(0,0,0); font-size: 1pt; word-spacing: 42pt;" class="_mt"><u>­ ­</u></font> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(a)</sup> </td>
<td align="left">As of June 30, 2010 and December 31, 2009, includes $163 million and $176 million, respectively, related to the Bifurcated Conversion Feature liability. </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(b)</sup> </td>
<td align="left">Instruments are in net gain positions as of June 30, 2010 and December 31, 2009. </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(c)</sup> </td>
<td align="left">Instruments are in net loss positions as of June 30, 2010 and December 31, 2009. </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The weighted average interest rate on outstanding vacation ownership contract receivables was 13.0% as of both June 30, 2010 and December 31, 2009. The estimated fair value of the vacation ownership contract receivables as of June 30, 2010 and December 31, 2009 was approximately 94% and 91%, respectively, of the carrying value. The primary reason for the fair value being lower than the carrying value related to the volatile credit markets in 2010 and 2009. Although the outstanding vacation ownership contract receivables had weighted average interest 13.0% as of both June 30, 2010 and December 31, 2009 the estimated market rate of return for a portfolio of contract receivables of similar characteristics in market conditions as of both June 30, 2010 and December 31, 2009 was 14%. </div></div> </div>
217000000
109000000
211000000
106000000
216000000
117000000
211000000
120000000
258000000
122000000
293000000
146000000
1386000000
1392000000
200000000
127000000
223000000
141000000
<div>
<table style="font-family: Arial,Helvetica; background: none transparent scroll repeat 0% 0%; color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%">
<tr valign="top"><td><b><font style="font-family: 'Times New Roman',Times;" class="_mt">10. Income Taxes</font></b></td>
<td> </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The Company or one of its subsidiaries files income tax returns in the U.S. federal jurisdiction and various states and foreign jurisdictions. With few exceptions, the Company is no longer subject to U.S. federal, state and local, or <font style="white-space: nowrap;" class="_mt">non-U.S. income</font> tax examinations by tax authorities for years before 2003. During the first quarter of 2007, the Internal Revenue Service ("IRS") opened an examination for Cendant Corporation's ("Cendant" or "former Parent") taxable years 2003 through 2006 during which the Company was included in Cendant's tax returns. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">As of June 30, 2010, the Company's accrual for outstanding Cendant contingent tax liabilities was $274 million, of which $185 million (net of state, foreign and other deferred tax adjustments) was related to the IRS examination. On July 15, 2010, the Company reached an agreement, along with Cendant, with the IRS that resolves and pays its outstanding Cendant contingent tax liabilities relating to the examination of the federal income tax returns for Cendant's taxable years 2003 through 2006. See Note 17—Subsequent Events for more detailed information. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The Company's effective tax rate declined from 44% during the second quarter of 2009 to 33% during the second quarter of 2010 primarily due to the absence of a write-off of deferred tax assets associated with stock based compensation, as well as a benefit derived from the current utilization of cumulative foreign tax credits, which the Company was able to realize based on certain changes in its tax profile. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The Company made cash income tax payments, net of refunds, of $44 million and $29 million during the six months ended June 30, 2010 and 2009, respectively. Such payments exclude income tax related payments made to former Parent. </div> </div>
84000000
56000000
78000000
46000000
-4000000
78000000
91000000
63000000
-51000000
-86000000
-126000000
-5000000
-25000000
23000000
-5000000
-2000000
21000000
17000000
15000000
-9000000
0
-13000000
-4000000
5000000
660000000
699000000
<div>
<div>
<table style="font-family: Arial,Helvetica; background: none transparent scroll repeat 0% 0%; color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%">
<tr valign="top"><td><b><font style="font-family: 'Times New Roman',Times;" class="_mt">4. Intangible Assets </font></b> </td>
<td> </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">Intangible assets consisted of: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 9pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="34%"> </td>
<td width="1%"> </td>
<td width="1%" align="right"> </td>
<td width="8%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="1%"> </td>
<td width="1%" align="right"> </td>
<td width="8%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="1%"> </td>
<td width="1%" align="right"> </td>
<td width="8%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="1%"> </td>
<td width="1%" align="right"> </td>
<td width="8%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="1%"> </td>
<td width="1%" align="right"> </td>
<td width="8%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="1%"> </td>
<td width="1%" align="right"> </td>
<td width="8%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="10" align="center"><b>As of June 30, 2010</b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="10" align="center"><b>As of December 31, 2009</b> </td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Gross<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Net<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Gross<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Net<br /></b></td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Carrying<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Accumulated<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Carrying<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Carrying<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Accumulated<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Carrying<br /></b></td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Amount</b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Amortization</b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Amount</b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Amount</b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Amortization</b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Amount</b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 9pt;"><i>Unamortized Intangible Assets:</i> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 19pt;">Goodwill </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,392 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,386 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 19pt;">Trademarks </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">699 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">660 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -9pt; margin-left: 9pt;"><i>Amortized Intangible Assets:</i> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 19pt;">Franchise agreements </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">637 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">308 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">329 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">630 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">298 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">332 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 19pt;">Other </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">115 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">34 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">81 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">94 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">35 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">59 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">752 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">342 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">410 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">724 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">333 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">391 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr></table></div></div>
<p> </p>
<div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"> </div>
<div style="margin-top: 0pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The changes in the carrying amount of goodwill are as follows: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="42%"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="1%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 9pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Balance at<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Goodwill<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Balance at<br /></b></td>
<td> </td></tr>
<tr style="font-size: 9pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>January 1,<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Acquired<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Foreign<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>June 30,<br /></b></td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 9pt;" class="_mt">2010</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 9pt;" class="_mt">During 2010</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 9pt;" class="_mt">Exchange</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 9pt;" class="_mt">2010</font></b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Lodging </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">297 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">9 </td>
<td valign="bottom" nowrap="nowrap" align="left"><sup style="font-size: 85%; vertical-align: top;">(a)</sup> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">306 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Vacation Exchange and Rentals </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1,089 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">38 </td>
<td valign="bottom" nowrap="nowrap" align="left"><sup style="font-size: 85%; vertical-align: top;">(b)</sup> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(41 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1,086 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Total Company </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,386 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">47 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">(41 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,392 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> <font style="white-space: nowrap; color: rgb(0,0,0); font-size: 1pt; word-spacing: 42pt;" class="_mt"><u>­ ­</u></font> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(a)</sup> </td>
<td align="left">Relates to the acquisition of Tryp (see Note 3—Acquisitions). </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(b)</sup> </td>
<td align="left">Relates to the acquisition of Hoseasons (see Note 3—Acquisitions). </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">Amortization expense relating to amortizable intangible assets was as follows: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="42%"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="1%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 9pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="6" nowrap="nowrap" align="center"><b>Three Months Ended<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="6" nowrap="nowrap" align="center"><b>Six Months Ended<br /></b></td>
<td> </td></tr>
<tr style="font-size: 9pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="6" nowrap="nowrap" align="center"><b>June 30,</b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="6" nowrap="nowrap" align="center"><b>June 30,</b> </td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 9pt;" class="_mt">2010</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 9pt;" class="_mt">2009</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 9pt;" class="_mt">2010</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 9pt;" class="_mt">2009</font></b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Franchise agreements </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">5 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">5 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">10 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">10 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Other </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">2 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">2 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">4 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">4 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Total <sup style="font-size: 85%; vertical-align: top;">(*)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">7 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">7 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">14 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">14 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> <font style="white-space: nowrap; color: rgb(0,0,0); font-size: 1pt; word-spacing: 42pt;" class="_mt"><u>­ ­</u></font> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(*)</sup> </td>
<td align="left">Included as a component of depreciation and amortization on the Company's Consolidated Statements of Income. </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">Based on the Company's amortizable intangible assets as of June 30, 2010, the Company expects related amortization expense as follows: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="86%"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="9%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">Amount</font></b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Remainder of 2010 </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">13 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">2011 </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">27 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">2012 </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">26 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">2013 </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">25 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">2014 </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">24 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">2015 </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">24 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr></table></div></div> </div>
45000000
26000000
86000000
36000000
<div>
<div>
<table style="font-family: Arial,Helvetica; background: none transparent scroll repeat 0% 0%; color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%">
<tr valign="top"><td><b><font style="font-family: 'Times New Roman',Times;" class="_mt">6. Inventory</font></b></td>
<td> </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">Inventory consisted of: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="70%"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>June 30,<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>December 31,<br /></b></td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">2010</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">2009</font></b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Land held for VOI development </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">119 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">119 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">VOI construction in process </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">330 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">352 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Completed inventory and vacation credits </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">820 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">836 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Total inventory </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1,269 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1,307 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Less: Current portion </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">343 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">354 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Non-current inventory </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">926 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">953 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">Inventory that the Company expects to sell within the next twelve months is classified as current on the Company's Consolidated Balance Sheets. </div></div> </div>
354000000
343000000
953000000
926000000
4000000
2000000
2000000
2000000
6664000000
6509000000
9352000000
9219000000
1885000000
1852000000
<div>
<div>
<p style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><font style="font-family: 'Times New Roman',Times;" class="_mt">5. Vacation Ownership Contract Receivables</font></b> </p>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The Company generates vacation ownership contract receivables by extending financing to the purchasers of VOIs. Current and long-term vacation ownership contract receivables, net consisted of: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="70%"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>June 30,<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>December 31,<br /></b></td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">2010</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">2009</font></b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;"><i>Current vacation ownership contract receivables:</i> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Securitized </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">259 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">244 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Non-securitized </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">63 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">52 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Secured <sup style="font-size: 85%; vertical-align: top;">(*)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">28 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">322 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">324 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Less: Allowance for loan losses </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(35 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(35 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Current vacation ownership contract receivables, net </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">287 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">289 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;"><i>Long-term vacation ownership contract receivables:</i> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Securitized </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">2,425 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">2,347 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Non-securitized </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">596 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">546 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Secured <sup style="font-size: 85%; vertical-align: top;">(*)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">234 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">3,021 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">3,127 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Less: Allowance for loan losses </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(323 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(335 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="top" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Long-term vacation ownership contract receivables, net </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">2,698 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">2,792 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> <font style="white-space: nowrap; color: rgb(0,0,0); font-size: 1pt; word-spacing: 42pt;" class="_mt"><u>­ ­</u></font> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(*)</sup> </td>
<td align="left">As of December 31, 2009, such receivables collateralized the Company's <font style="white-space: nowrap;" class="_mt">364-day,</font> AUD 213 million, secured, revolving foreign credit facility, which was paid down and terminated during March 2010 (See Note 7—Long-Term Debt and Borrowing Arrangements). </td></tr></table></div>
<div> </div>
<div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">During the three and six months ended June 30, 2010, the Company's securitized vacation ownership contract receivables generated interest income of $81 million and $161 million, respectively. During the three and six months ended June 30, 2009, such amounts were $81 million and $163 million, respectively. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">Principal payments that are contractually due on the Company's vacation ownership contract receivables during the next twelve months are classified as current on the Company's Consolidated Balance Sheets. During the six months ended June 30, 2010 and 2009, the Company originated vacation ownership contract receivables of $474 million and $443 million, respectively, and received principal collections of $388 million and $392 million, respectively. The weighted average interest rate on outstanding vacation ownership contract receivables was 13.0% at both June 30, 2010 and December 31, 2009. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The activity in the allowance for loan losses on vacation ownership contract receivables was as follows: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="85%"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">Amount</font></b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Allowance for loan losses as of January 1, 2010 </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">(370 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Provision for loan losses </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(174 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Contract receivables written-off </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">186 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Allowance for loan losses as of June 30, 2010 </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">(358 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">In accordance with the guidance for accounting for real estate timesharing transactions, the Company recorded the provision for loan losses of $87 million and $174 million as a reduction of net revenues during the three and six months ended June 30, 2010, respectively, and $122 million and $229 million during the three and six months ended June 30, 2009, respectively. </div></div> </div>
275000000
137000000
261000000
138000000
-356000000
-283000000
-76000000
-183000000
459000000
557000000
116000000
116000000
71000000
145000000
145000000
95000000
759000000
391000000
769000000
387000000
238000000
151000000
302000000
172000000
<div>
<div>
<table style="font-family: Arial,Helvetica; background: none transparent scroll repeat 0% 0%; color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%">
<tr valign="top"><td><b><font style="font-family: 'Times New Roman',Times;" class="_mt">1. </font></b> </td>
<td>
<p align="left"><b><font style="font-family: 'Times New Roman',Times;" class="_mt">Basis of Presentation</font></b> </p></td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">Wyndham Worldwide Corporation is a global provider of hospitality products and services. The accompanying Consolidated Financial Statements include the accounts and transactions of Wyndham, as well as the entities in which Wyndham directly or indirectly has a controlling financial interest. The accompanying Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America. All intercompany balances and transactions have been eliminated in the Consolidated Financial Statements. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">In presenting the Consolidated Financial Statements, management makes estimates and assumptions that affect the amounts reported and related disclosures. Estimates, by their nature, are based on judgment and available information. Accordingly, actual results could differ from those estimates. In management's opinion, the Consolidated Financial Statements contain all normal recurring adjustments necessary for a fair presentation of interim results reported. The results of operations reported for interim periods are not necessarily indicative of the results of operations for the entire year or any subsequent interim period. These financial statements should be read in conjunction with the Company's 2009 Consolidated Financial Statements included in its Annual Report filed on <font style="white-space: nowrap;" class="_mt">Form 10-K</font> with the Securities and Exchange Commission ("SEC") on February 19, 2010. </div>
<div style="margin-top: 12pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> Business Description</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The Company operates in the following business segments: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="7%"> </td>
<td width="3%"> </td>
<td width="90%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" valign="top"><td> </td>
<td><font class="_mt">·</font> </td>
<td align="left"><b>Lodging</b>—franchises hotels in the upscale, midscale, economy and extended stay segments of the lodging industry and provides hotel management services for full-service hotels globally. </td></tr>
<tr style="line-height: 6pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" valign="top"><td> </td>
<td><font class="_mt">·</font> </td>
<td align="left"><b>Vacation Exchange and Rentals</b>—provides vacation exchange products and services to owners of intervals of vacation ownership interests ("VOIs") and markets vacation rental properties primarily on behalf of independent owners. </td></tr>
<tr style="line-height: 6pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" valign="top"><td> </td>
<td><font class="_mt">·</font> </td>
<td align="left"><b>Vacation Ownership</b>—develops, markets and sells VOIs to individual consumers, provides consumer financing in connection with the sale of VOIs and provides property management services at resorts. </td></tr></table>
<div style="margin-top: 12pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> Significant Accounting Policies</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left"><i>Intangible Assets.</i> The Company annually (during the fourth quarter of each year subsequent to completing its annual forecasting process), or more frequently if circumstances prescribed by the guidance for goodwill and other intangible assets are present, reviews its goodwill and other indefinite-lived intangible assets recorded in connection with business combinations for impairment. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left"><i>Allowance for Loan Losses.</i> In the Company's Vacation Ownership segment, the Company provides for estimated vacation ownership contract receivable defaults at the time of VOI sales by recording a provision for loan losses as a reduction of VOI sales on the Consolidated Statements of Income. The Company assesses the adequacy of the allowance for loan losses based on the historical performance of similar vacation ownership contract receivables using a technique referred to as static pool analysis, which tracks defaults for each year's sales over the entire life of those contract receivables. The Company considers current defaults, past due aging, historical write-offs of contracts, consumer credit scores (FICO scores) in the assessment of borrower's credit strength and expected loan performance. The Company also considers whether the historical economic conditions are comparable to current economic conditions. If current conditions differ from the conditions in effect when the historical experience was generated, the Company adjusts the allowance for loan losses to reflect the expected effects of the current environment on the collectability of its vacation ownership contract receivables. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left"><i>Restricted Cash.</i> The largest portion of the Company's restricted cash relates to securitizations. The remaining portion is comprised of cash held in escrow related to the Company's vacation ownership business and cash held in all other escrow accounts. Restricted cash related to securitization was $153 million and $133 million as of June 30, 2010 and December 31, 2009, respectively, of which $91 million and $69 million were recorded within other current assets as of June 30, 2010 and December 31, 2009, respectively, and $62 million and $64 million were recorded within other non-current assets as of June 30, 2010 and December 31, 2009, respectively, on the Consolidated Balance Sheets. Restricted cash related to escrow deposits was $26 million and $19 million as of June 30, 2010 and December 31, 2009, respectively, which were recorded within other current assets as of June 30, 2010 and December 31, 2009, respectively, on the Consolidated Balance Sheets. </div></div>
<div>
<div style="margin-top: 12pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> Recently Issued Accounting Pronouncements</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left"><i>Transfers and Servicing.</i> In June 2009, the Financial Accounting Standards Board ("FASB") issued guidance on transfers and servicing of financial assets. The guidance eliminates the concept of a Qualifying Special-Purpose Entity, changes the requirements for derecognizing financial assets and requires additional disclosures in order to enhance information reported to users of financial statements by providing greater transparency about transfers of financial assets, including securitization transactions, and an entity's continuing involvement in and exposure to the risks related to transferred financial assets. The guidance is effective for interim or annual reporting periods beginning after November 15, 2009. The Company adopted the guidance on January 1, 2010, as required. See Note 7—Long-Term Debt and Borrowing Arrangements for additional disclosure required by such guidance. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left"><i>Consolidation.</i> In June 2009, the FASB issued guidance that modifies how a company determines when an entity that is insufficiently capitalized or is not controlled through voting (or similar rights) should be consolidated. The guidance clarifies that the determination of whether a company is required to consolidate an entity is based on, among other things, an entity's purpose and design and a company's ability to direct the activities of the entity that most significantly impact the entity's economic performance. The guidance requires an ongoing reassessment of whether a company is the primary beneficiary of a variable interest entity, additional disclosures about a company's involvement in variable interest entities and any significant changes in risk exposure due to that involvement. The guidance is effective for interim or annual reporting periods beginning after November 15, 2009. The Company adopted the guidance on January 1, 2010, as required. See Note 7—Long-Term Debt and Borrowing Arrangements for additional disclosure required by such guidance. </div></div> </div>
233000000
233000000
477000000
479000000
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29000000
-42000000
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32000000
8000000
6000000
579000000
575000000
174000000
166000000
1840000000
1763000000
3000000
0
5000000
3000000
109000000
55000000
106000000
57000000
18000000
39000000
42000000
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-1000000
-2000000
0
69000000
11000000
24000000
15000000
44000000
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105000000
4000000
8000000
87000000
63000000
0.01
0.01
6000000
6000000
0
0
0
0
0
0
116000000
117000000
628000000
749000000
668000000
621000000
11000000
0
460000000
247000000
2000000
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3000000
16000000
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16000000
953000000
887000000
229000000
174000000
289000000
287000000
<div>
<div>
<table style="font-family: Arial,Helvetica; background: none transparent scroll repeat 0% 0%; color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%">
<tr valign="top"><td><b><font style="font-family: 'Times New Roman',Times;" class="_mt">16.</font></b></td>
<td><b><font style="font-family: 'Times New Roman',Times;" class="_mt">Separation Adjustments and Transactions with Former Parent and Subsidiaries</font></b> </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> Transfer of Cendant Corporate Liabilities and Issuance of Guarantees to Cendant and Affiliates</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">Pursuant to the Separation and Distribution Agreement, upon the distribution of the Company's common stock to Cendant shareholders, the Company entered into certain guarantee commitments with Cendant (pursuant to the assumption of certain liabilities and the obligation to indemnify Cendant and Cendant's former real estate services ("Realogy") and travel distribution services ("Travelport") for such liabilities) and guarantee commitments related to deferred compensation arrangements with each of Cendant and Realogy. These guarantee arrangements primarily relate to certain contingent litigation liabilities, contingent tax liabilities, and Cendant contingent and other corporate liabilities, of which the Company assumed and is responsible for 37.5% while Realogy is responsible for the remaining 62.5%. The amount of liabilities which were assumed by the Company in connection with the Separation was $310 million as of both June 30, 2010 and December 31, 2009. These amounts were comprised of certain Cendant corporate liabilities which were recorded on the books of Cendant as well as additional liabilities which were established for guarantees issued at the date of Separation, July 31, 2006 ("Separation Date"), related to certain unresolved contingent matters and certain others that could arise during the guarantee period. Regarding the guarantees, if any of the companies responsible for all or a portion of such liabilities were to default in its payment of costs or expenses related to any such liability, the Company would be responsible for a portion of the defaulting party or parties' obligation. The Company also provided a default guarantee related to certain deferred compensation arrangements related to certain current and former senior officers and directors of Cendant, Realogy and Travelport. These arrangements, which are discussed in more detail below, have been valued upon the Separation in accordance with the guidance for guarantees and recorded as liabilities on the Consolidated Balance Sheets. To the extent such recorded liabilities are not adequate to cover the ultimate payment amounts, such excess will be reflected as an expense to the results of operations in future periods. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">As a result of the sale of Realogy on April 10, 2007, Realogy's senior debt credit rating was downgraded to below investment grade. Under the Separation Agreement, if Realogy experienced such a change of control and suffered such a ratings downgrade, it was required to post a letter of credit in an amount acceptable to the Company and Avis Budget Group to satisfy the fair value of Realogy's indemnification obligations for the Cendant legacy contingent liabilities in the event Realogy does not otherwise satisfy such obligations to the extent they become due. On April 26, 2007, Realogy posted a $500 million irrevocable standby letter of credit from a major commercial bank in favor of Avis Budget Group and upon which demand may be made if Realogy does not otherwise satisfy its obligations for its share of the Cendant legacy contingent liabilities. The letter of credit can be adjusted from time to time based upon the outstanding contingent liabilities and has an expiration date of September 2013, subject to renewal and certain provisions. As such, on August 11, 2009, the letter of credit was reduced to $446 million. The issuance of this letter of credit does not relieve or limit Realogy's obligations for these liabilities. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">As of June 30, 2010, the $310 million of Separation related liabilities is comprised of $5 million for litigation matters, $274 million for tax liabilities, $21 million for liabilities of previously sold businesses of Cendant, $8 million for other contingent and corporate liabilities and $2 million of liabilities where the calculated guarantee amount exceeded the contingent liability assumed at the Separation Date. In connection with these liabilities, $246 million is recorded in current due to former Parent and subsidiaries and $62 million is recorded in long-term due to former Parent and subsidiaries as of June 30, 2010 on the Consolidated Balance Sheet. The Company is indemnifying Cendant for these contingent liabilities and therefore any payments made to the third party would be through the former Parent. The $2 million relating to guarantees is recorded in other current liabilities as of June 30, 2010 on the Consolidated Balance Sheet. The actual timing of payments relating to these liabilities is dependent on a variety of factors beyond the Company's control. See Management's Discussion and Analysis — Contractual Obligations for the estimated timing of such payments. In addition, as of June 30, 2010, the Company had $5 million of receivables due from former Parent and subsidiaries primarily relating to income taxes, which is recorded in other current assets on the Consolidated Balance Sheet. Such receivables totaled $5 million as of December 31, 2009. </div></div>
<div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">Following is a discussion of the liabilities on which the Company issued guarantees. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="7%"> </td>
<td width="3%"> </td>
<td width="90%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" valign="top"><td> </td>
<td><font class="_mt">·</font> </td>
<td align="left"><b>Contingent litigation liabilities </b>The Company assumed 37.5% of liabilities for certain litigation relating to, arising out of or resulting from certain lawsuits in which Cendant is named as the defendant. The indemnification obligation will continue until the underlying lawsuits are resolved. The Company will indemnify Cendant to the extent that Cendant is required to make payments related to any of the underlying lawsuits. As the indemnification obligation relates to matters in various stages of litigation, the maximum exposure cannot be quantified. Due to the inherently uncertain nature of the litigation process, the timing of payments related to these liabilities cannot reasonably be predicted, but is expected to occur over several years. Since the Separation, Cendant settled a majority of these lawsuits and the Company assumed a portion of the related indemnification obligations. For each settlement, the Company paid 37.5% of the aggregate settlement amount to Cendant. The Company's payment obligations under the settlements were greater or less than the Company's accruals, depending on the matter. On September 7, 2007, Cendant received an adverse ruling in a litigation matter for which the Company retained a 37.5% indemnification obligation. The judgment on the adverse ruling was entered on May 16, 2008. On May 23, 2008, Cendant filed an appeal of the judgment and, on July 1, 2009, an order was entered denying the appeal. As a result of the denial of the appeal, Realogy and the Company determined to pay the judgment. On July 23, 2009, the Company paid its portion of the aforementioned judgment ($37 million). Although the judgment for the underlying liability for this matter has been paid, the phase of the litigation involving the determination of fees owed the plaintiffs' attorneys remains pending. Similar to the contingent liability, the Company is responsible for 37.5% of any attorneys' fees payable. As a result of settlements and payments to Cendant, as well as other reductions and accruals for developments in active litigation matters, the Company's aggregate accrual for outstanding Cendant contingent litigation liabilities was $5 million as of June 30, 2010. </td></tr>
<tr style="line-height: 6pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" valign="top"><td> </td>
<td><font class="_mt">·</font> </td>
<td align="left"><b>Contingent tax liabilities </b>Prior to the Separation, the Company was included in the consolidated federal and state income tax returns of Cendant through the Separation date for the 2006 period then ended. The Company is generally liable for 37.5% of certain contingent tax liabilities. In addition, each of the Company, Cendant and Realogy may be responsible for 100% of certain of Cendant's tax liabilities that will provide the responsible party with a future, offsetting tax benefit. </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 10%; font-size: 10pt; margin-right: 0%;" align="left">During the first quarter of 2007, the IRS opened an examination for Cendant's taxable years 2003 through 2006 during which the Company was included in Cendant's tax returns. As of June 30, 2010, the Company's accrual for outstanding Cendant contingent tax liabilities was $274 million. On July 15, 2010, Cendant and the IRS agreed to settle the IRS examination of Cendant's taxable years 2003 through 2006. The agreements with the IRS close the IRS examination for tax periods prior to the Separation Date. See Note 17 — Subsequent Events for more detailed information. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="7%"> </td>
<td width="3%"> </td>
<td width="90%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" valign="top"><td> </td>
<td><font class="_mt">·</font> </td>
<td align="left"><b>Cendant contingent and other corporate liabilities </b>The Company has assumed 37.5% of corporate liabilities of Cendant including liabilities relating to (i) Cendant's terminated or divested businesses; (ii) liabilities relating to the Travelport sale, if any; and (iii) generally any actions with respect to the Separation plan or the distributions brought by any third party. The Company's maximum exposure to loss cannot be quantified as this guarantee relates primarily to future claims that may be made against Cendant. The Company assessed the probability and amount of potential liability related to this guarantee based on the extent and nature of historical experience. </td></tr>
<tr style="line-height: 6pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" valign="top"><td> </td>
<td><font class="_mt">·</font> </td>
<td align="left"><b>Guarantee related to deferred compensation arrangements </b>In the event that Cendant, Realogy <font style="white-space: nowrap;" class="_mt">and/or</font> Travelport are not able to meet certain deferred compensation obligations under specified plans for certain current and former officers and directors because of bankruptcy or insolvency, the Company has guaranteed such obligations (to the extent relating to amounts deferred in respect of 2005 and earlier). This guarantee will remain outstanding until such deferred compensation balances are distributed to the respective officers and directors. The maximum exposure cannot be quantified as the guarantee, in part, is related to the value of deferred investments as of the date of the requested distribution. </td></tr></table></div> </div>
809000000
710000000
1248000000
1059000000
<div>
<div>
<table style="font-family: Arial,Helvetica; background: none transparent scroll repeat 0% 0%; color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%">
<tr valign="top"><td><b><font style="font-family: 'Times New Roman',Times;" class="_mt">15. Restructuring</font></b> </td>
<td> </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">During 2008, the Company committed to various strategic realignment initiatives targeted principally at reducing costs, enhancing organizational efficiency and consolidating and rationalizing existing processes and facilities. During the three and six months ended June 30, 2009, the Company recorded $3 million and $46 million, respectively, of incremental restructuring costs. During the six months ended June 30, 2010, the Company reduced its liability with $7 million of cash payments. The remaining liability of $15 million is expected to be paid in cash; $14 million of facility-related by September 2017 and $1 million of personnel-related by December 2010. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">Total restructuring costs by segment for the six months ended June 30, 2009 are as follows: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="32%"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="1%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="1%"> </td>
<td width="1%" align="right"> </td>
<td width="12%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="1%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="1%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 9pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Personnel<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Facility<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Asset Write-off's/<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Contract<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 9pt;" class="_mt">Related <sup style="font-size: 85%; vertical-align: top;">(a)</sup></font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 9pt;" class="_mt">Related <sup style="font-size: 85%; vertical-align: top;">(b)</sup></font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 9pt;" class="_mt">Impairments <sup style="font-size: 85%; vertical-align: top;">(c)</sup></font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 9pt;" class="_mt">Termination <sup style="font-size: 85%; vertical-align: top;">(d)</sup></font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 9pt;" class="_mt">Total</font></b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Lodging </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">3 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">3 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Vacation Exchange and Rentals </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">5 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">6 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Vacation Ownership </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">20 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">14 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">36 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Corporate </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Total </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">10 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">21 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">14 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">46 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> <font style="white-space: nowrap; color: rgb(0,0,0); font-size: 1pt; word-spacing: 42pt;" class="_mt"><u>­ ­</u></font> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(a)</sup> </td>
<td align="left">Represents severance benefits resulting from reductions of approximately 390 in staff. The Company formally communicated the termination of employment to substantially all 390 employees, representing a wide range of employee groups. As of June 30, 2009, the Company had terminated approximately 250 of these employees. </td></tr>
<tr style="line-height: 6pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(b)</sup> </td>
<td align="left">Primarily related to the termination of leases of certain sales offices. </td></tr>
<tr style="line-height: 6pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(c)</sup> </td>
<td align="left">Primarily related to the write-off of assets from sales office closures and cancelled development projects. </td></tr>
<tr style="line-height: 6pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(d)</sup> </td>
<td align="left">Primarily represents costs incurred in connection with the termination of a property development contract. </td></tr></table>
<p style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" align="center"> </p></div>
<div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The activity related to the restructuring costs is summarized by category as follows: </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="58%"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="1%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="1%"> </td>
<td width="1%" align="right"> </td>
<td width="12%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 9pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Liability as of<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Liability as of<br /></b></td>
<td> </td></tr>
<tr style="font-size: 9pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>January 1,<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Cash<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>June 30,<br /></b></td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 9pt;" class="_mt">2010</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 9pt;" class="_mt">Payments</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 9pt;" class="_mt">2010</font></b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Personnel-Related <sup style="font-size: 85%; vertical-align: top;">(*)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">3 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">2 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Facility-Related </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">18 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">4 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">14 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Contract Terminations </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">— </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">22 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">7 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">15 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> <font style="white-space: nowrap; color: rgb(0,0,0); font-size: 1pt; word-spacing: 42pt;" class="_mt"><u>­ ­</u></font> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(*)</sup> </td>
<td align="left">As of June 30, 2010, the Company had terminated all of the employees related to such costs. </td></tr></table>
<div style="margin-top: 12pt; font-size: 1pt;"> </div></div> </div>
46000000
3000000
0
0
15000000
0
-315000000
-215000000
1821000000
920000000
1849000000
963000000
<div>
<table style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="96%"> </td></tr>
<tr valign="top"><td><b><font style="font-family: 'Times New Roman', Times;" class="_mt"> 3. </font></b> </td>
<td><b><font style="font-family: 'Times New Roman', Times;" class="_mt">Acquisitions</font></b> </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman', Times; background: #ffffff; color: #000000; margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">Assets acquired and liabilities assumed in business combinations were recorded on the Consolidated Balance Sheets as of the respective acquisition dates based upon their estimated fair values at such dates. The results of operations of businesses acquired by the Company have been included in the Consolidated Statement of Income since their respective dates of acquisition. The excess of the purchase price over the estimated fair values of the underlying assets acquired and liabilities assumed was allocated to goodwill. In certain circumstances, the allocations of the excess purchase price are based upon preliminary estimates and assumptions. Accordingly, the allocations may be subject to revision when the Company receives final information, including appraisals and other analyses. Any revisions to the fair values during the allocation period will be recorded by the Company as further adjustments to the purchase price allocations. Although, in certain circumstances, the Company has substantially integrated the operations of its acquired businesses, additional future costs relating to such integration may occur. These costs may result from integrating operating systems, relocating employees, closing facilities, reducing duplicative efforts and exiting and consolidating other activities. These costs will be recorded on the Consolidated Statement of Income as expenses. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman', Times; background: #ffffff; color: #000000; margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left"><i>Hoseasons.</i> On March 1, 2010, the Company completed the acquisition of Hoseasons Holdings Ltd. ("Hoseasons"), a European vacation rentals business, for $59 million in cash, net of cash acquired. The purchase price allocation resulted in the recognition of $38 million of goodwill, $30 million of definite-lived intangible assets with a weighted average life of 18 years and $16 million of trademarks, all of which were assigned to the Company's Vacation Exchange and Rentals segment. None of the acquired goodwill is expected to be deductible for tax purposes. Management believes that this acquisition offers a strategic fit within the Company's European rentals business and an opportunity to continue to grow the Company's <font style="white-space: nowrap;" class="_mt">fee-for-service</font> businesses. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman', Times; background: #ffffff; color: #000000; margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left"><i>Tryp.</i> On June 30, 2010, the Company completed the acquisition of the Tryp hotel brand ("Tryp") for $43 million in cash. The preliminary purchase price allocation resulted in the recognition of $9 million of goodwill, $7 million of franchise agreements with a weighted average life of 20 years and $27 million of trademarks, all of which were assigned to the Company's Lodging segment. Management believes that this acquisition increases the Company's footprint in Europe and Latin America and presents enhanced growth opportunities for its lodging business in North America. </div>
<div style="margin-top: 12pt; font-size: 1pt;"> </div> </div>
<div>
<table style="font-family: Arial,Helvetica; background: none transparent scroll repeat 0% 0%; color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%">
<tr valign="top"><td><b><font style="font-family: 'Times New Roman',Times;" class="_mt">17. Subsequent Events</font></b> </td>
<td> </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> IRS Settlement</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">On July 15, 2010, Cendant and the IRS agreed to settle the IRS examination of Cendant's taxable years 2003 through 2006. During such period, the Company and Realogy were included in Cendant's tax returns. The agreements with the IRS close the IRS examination for tax periods prior to the Separation Date. The agreements with the IRS also include a resolution with respect to the tax treatment of Wyndham timeshare receivables, which resulted in the acceleration of unrecognized Wyndham deferred tax liabilities as of the Separation Date. In connection with reaching agreement with the IRS to resolve the contingent federal tax liabilities at issue, the Company entered into an agreement with Realogy to clarify each party's obligations under the tax sharing agreement. Under the agreement with Realogy, among other things, the parties specified that the Company has sole responsibility for taxes and interest associated with the acceleration of timeshare receivables income previously deferred for tax purposes, while Realogy will not seek any reimbursement for the loss of a step up in basis of certain assets. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">During the third quarter 2010, the Company expects to make payment for all such tax liabilities, including the final interest payable, to Cendant who is the taxpayer and receive payments from Realogy. The Company expects its aggregate net payments to approximate $145 million. As of June 30, 2010, the Company's accrual for outstanding Cendant contingent tax liabilities was $274 million, of which $185 million was in respect of items resolved in the agreement with the IRS and the remaining $89 million relates to state and foreign tax legacy issues, which are expected to be resolved in the next few years. Therefore, the Company expects to recognize income during the third quarter of 2010 of approximately $40 million for the residual accrual that will no longer be required for such items. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The agreement with the IRS and the net payment of $145 million referenced above will also result in the reversal of approximately $190 million in net deferred tax liabilities allocated from Cendant on the Separation Date with a corresponding increase to stockholders' equity during the third quarter of 2010. </div>
<div style="margin-top: 12pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> Dividend Declaration</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">On July 22, 2010, the Company's Board of Directors declared a dividend of $0.12 per share payable September 10, 2010 to shareholders of record as of August 26, 2010. </div>
<div style="margin-top: 12pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> Increased Stock Repurchase Program</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">On July 22, 2010, the Company's Board of Directors increased the authorization for the Company's stock repurchase program by $300 million. </div>
<div style="margin-top: 12pt; font-size: 1pt;"> </div>
<div style="font-family: Arial,Helvetica; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><i><font style="font-family: 'Times New Roman',Times;" class="_mt"> Securitization Term Transaction</font></i></b> </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">On July 23, 2010, the Company closed a series of term notes payable, Sierra Timeshare <font style="white-space: nowrap;" class="_mt">2010-2</font> Receivables Funding LLC, in the initial principal amount of $350 million. These borrowings bear interest at a weighted average coupon rate of 4.11% and are secured by vacation ownership contract receivables. </div> </div>
209000000
248000000
1298000000
1298000000
<div>
<div>
<table style="font-family: Arial,Helvetica; background: none transparent scroll repeat 0% 0%; color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%">
<tr valign="top"><td><b><font style="font-family: 'Times New Roman',Times;" class="_mt">14. Segment Information</font></b> </td>
<td> </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 4%; font-size: 10pt; margin-right: 0%;" align="left">The reportable segments presented below represent the Company's operating segments for which separate financial information is available and which is utilized on a regular basis by its chief operating decision maker to assess performance and to allocate resources. In identifying its reportable segments, the Company also considers the nature of services provided by its operating segments. Management evaluates the operating results of each of its reportable segments based upon net revenues and "EBITDA," which is defined as net income before depreciation and amortization, interest expense (excluding consumer financing interest), interest income (excluding consumer financing interest) and income taxes, each of which is presented on the Company's Consolidated Statements of Income. The Company's presentation of EBITDA may not be comparable to similarly-titled measures used by other companies. </div>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="41%"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="14" align="center"><b>Three Months Ended June 30,</b> </td>
<td> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="6" align="center"><b>2010</b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="6" align="center"><b>2009</b> </td>
<td> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Net<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Net<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">Revenues</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">EBITDA</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">Revenues</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">EBITDA <sup style="font-size: 85%; vertical-align: top;">(d)</sup></font></b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Lodging </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">178 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">49 </td>
<td valign="bottom" nowrap="nowrap" align="left"><sup style="font-size: 85%; vertical-align: top;">(c)</sup> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">174 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">50 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Vacation Exchange and Rentals </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">281 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">78 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">280 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">56 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Vacation Ownership </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">505 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">104 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">467 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">107 </td>
<td valign="bottom" nowrap="nowrap" align="left"><sup style="font-size: 85%; vertical-align: top;">(e)</sup> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Total Reportable Segments </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">964 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">231 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">921 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">213 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Corporate and Other <sup style="font-size: 85%; vertical-align: top;">(a)(b)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(1 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(14 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(1 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(17 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Total Company </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">963 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">217 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">920 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">196 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Depreciation and amortization </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">42 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">45 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Interest expense </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">36 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">26 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Interest income </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(2 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(2 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Income before income taxes </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">141 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">127 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> <font style="white-space: nowrap; color: rgb(0,0,0); font-size: 1pt; word-spacing: 42pt;" class="_mt"><u>­ ­</u></font> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(a)</sup> </td>
<td align="left">Includes the elimination of transactions between segments. </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(b)</sup> </td>
<td align="left">Includes $14 million and $19 million of corporate costs during the three months ended June 30, 2010 and 2009, respectively. </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(c)</sup> </td>
<td align="left">Includes $1 million related to costs incurred in connection with the Company's acquisition of Tryp during June 2010. </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(d)</sup> </td>
<td align="left">Includes restructuring costs of $2 million and $1 million for Vacation Exchange and Rentals and Vacation Ownership, respectively, during the three months ended June 30, 2009. </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(e)</sup> </td>
<td align="left">Includes a non-cash impairment charge of $3 million to reduce the value of certain vacation ownership properties and related assets held for sale that are no longer consistent with the Company's development plans. </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div></div>
<p> </p>
<div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"> </div>
<div style="margin-top: 0pt; font-size: 1pt;"> </div>
<div style="margin-left: 4%; margin-right: 0%;">
<table style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="96%">
<tr style="font-size: 1pt;" valign="bottom"><td width="41%"> </td>
<td width="2%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td>
<td width="3%"> </td>
<td width="1%" align="right"> </td>
<td width="10%" align="right"> </td>
<td width="1%" align="left"> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="14" align="center"><b>Six Months Ended June 30,</b> </td>
<td> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="6" align="center"><b>2010</b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="6" align="center"><b>2009</b> </td>
<td> </td></tr>
<tr style="font-size: 10pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Net<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Net<br /></b></td>
<td> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center"> </td>
<td> </td></tr>
<tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center"> </td>
<td> </td>
<td valign="bottom" colspan="2" nowrap="nowrap" align="center">
<div style="border-bottom: rgb(0,0,0) 1px solid; padding-bottom: 1px; width: 1%;"><b><font style="font-size: 10pt;" class="_mt">Revenues</font></b> </div></td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">EBITDA</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">Revenues</font></b> </td>
<td> </td>
<td> </td>
<td style="border-bottom: rgb(0,0,0) 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b><font style="font-size: 10pt;" class="_mt">EBITDA <sup style="font-size: 85%; vertical-align: top;">(f)</sup></font></b> </td>
<td> </td></tr>
<tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Lodging </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">322 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">82 </td>
<td valign="bottom" nowrap="nowrap" align="left"><sup style="font-size: 85%; vertical-align: top;">(c)</sup> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">328 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">85 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Vacation Exchange and Rentals </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">582 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">158 </td>
<td valign="bottom" nowrap="nowrap" align="left"><sup style="font-size: 85%; vertical-align: top;">(d)</sup> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">566 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">132 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Vacation Ownership </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">950 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">186 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">929 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">151 </td>
<td valign="bottom" nowrap="nowrap" align="left"><sup style="font-size: 85%; vertical-align: top;">(g)</sup> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Total Reportable Segments </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1,854 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">426 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">1,823 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">368 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Corporate and Other <sup style="font-size: 85%; vertical-align: top;">(a)(b)</sup> </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(5 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(34 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(2 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(39 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 20pt;">Total Company </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,849 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">392 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">1,821 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">329 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Depreciation and amortization </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">85 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">88 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Interest expense </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">86 </td>
<td valign="bottom" nowrap="nowrap" align="left"><sup style="font-size: 85%; vertical-align: top;">(e)</sup> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">45 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Interest income </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(2 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right">(4 </td>
<td valign="bottom" nowrap="nowrap" align="left">) </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td style="border-top: rgb(0,0,0) 1px solid;"> </td>
<td> </td></tr>
<tr valign="bottom"><td valign="bottom" align="left">
<div style="text-indent: -10pt; margin-left: 10pt;">Income before income taxes </div></td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">223 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td valign="bottom" nowrap="nowrap" align="right"> </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td>
<td> </td>
<td valign="bottom" nowrap="nowrap" align="left">$ </td>
<td valign="bottom" nowrap="nowrap" align="right">200 </td>
<td valign="bottom" nowrap="nowrap" align="left"> </td></tr>
<tr style="font-size: 1pt;" valign="bottom"><td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td style="border-top: rgb(0,0,0) 3px double;"> </td>
<td> </td></tr></table></div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div>
<div style="text-indent: 0%; font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> <font style="white-space: nowrap; color: rgb(0,0,0); font-size: 1pt; word-spacing: 42pt;" class="_mt"><u>­ ­</u></font> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(a)</sup> </td>
<td align="left">Includes the elimination of transactions between segments. </td></tr>
<tr style="line-height: 6pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(b)</sup> </td>
<td align="left">Includes $1 million and $3 million of a net expense related to the resolution of and adjustment to certain contingent liabilities and assets during the six months ended June 30, 2010 and 2009, respectively, and $32 million and $36 million of corporate costs during the six months ended June 30, 2010 and 2009, respectively. </td></tr>
<tr style="line-height: 6pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(c)</sup> </td>
<td align="left">Includes $1 million related to costs incurred in connection with the Company's acquisition of Tryp during June 2010. </td></tr>
<tr style="line-height: 6pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(d)</sup> </td>
<td align="left">Includes $4 million related to costs incurred in connection with the Company's acquisition of Hoseasons during March 2010. </td></tr>
<tr style="line-height: 6pt; font-size: 1pt;"><td> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(e)</sup> </td>
<td align="left">Includes $1 million and $15 million for Vacation Ownership and Corporate and Other, respectively, of costs incurred for the early extinguishment of the Company's revolving foreign credit facility and term loan facility during March 2010. </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(f)</sup> </td>
<td align="left">Includes restructuring costs of $3 million, $6 million, $36 million and $1 million for Lodging, Vacation Exchange and Rentals, Vacation Ownership and Corporate and Other, respectively, during the six months ended June 30, 2009. </td></tr></table>
<div style="margin-top: 6pt; font-size: 1pt;"> </div>
<table border="0" cellspacing="0" cellpadding="0" width="100%">
<tr><td width="4%"> </td>
<td width="3%"> </td>
<td width="93%"> </td></tr>
<tr style="font-family: 'Times New Roman',Times; background: rgb(255,255,255); color: rgb(0,0,0); font-size: 8pt;" valign="top"><td> </td>
<td><sup style="font-size: 85%; vertical-align: top;">(g)</sup> </td>
<td align="left">Includes a non-cash impairment charge of $8 million to reduce the value of certain vacation ownership properties and related assets held for sale that are no longer consistent with the Company's development plans. </td></tr></table>
<div style="margin-top: 12pt; font-size: 1pt;"> </div></div> </div>
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20000000
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3715000000
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2688000000
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