What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2022-02-23 compared with 2021-02-24 · 275 added, 504 removed, 213 unchanged (79% of the section changed)

Company Overview

On January 5, 2021, Wyndham Destinations, Inc.

acquired the Travel + Leisure brand from Meredith Corporation (“Meredith”) and subsequently changed its name to Travel + Leisure Co.

on February 17, 2021.

Travel + Leisure Co.

is the world’s leading membership and leisure travel company.

We provide vacation experiences and travel inspiration to millions of owners and members every year through our products and services.

We have two financial reporting segments:

Vacation Ownership, which includes the world’s largest vacation ownership business with 247 vacation club resort locations across the globe;

and Travel and Membership, the world’s foremost membership travel business which includes the largest vacation exchange company, industry-leading travel technology, and subscription travel brands.

At Travel + Leisure Co., our global team of associates brings hospitality to millions, turning vacation inspiration into exceptional travel experiences.

We put the world on vacation.

COVID-19 Pandemic

The results of operations for 2020 include impacts related to the novel coronavirus global pandemic (“COVID-19”), which have been significantly negative for the travel industry, our company, our customers, and our employees.

In response to COVID-19, our Vacation Ownership segment temporarily closed its resorts in mid-March 2020 across the globe and suspended its sales and marketing operations.

In our Travel and Membership segment, affiliate resort closures and regional travel restrictions contributed to decreased bookings and increased cancellations.

As a result, we significantly reduced our workforce and furloughed thousands of associates.

As of December 31, 2020, we have reopened 81% of our resorts (92% as of the date of this filing) and reopened 86% of our sales offices (92% as of the date of this filing).

Throughout 2020, many of our associates returned to work as locations reopened;

however, we exited the year with approximately 5,300 associates either laid off or furloughed.

Our reopening plans were negatively impacted in the fourth quarter of 2020 by government shutdowns in California and Hawaii.

We estimate that the remaining suspended operations will resume in early 2021.

During the year we have taken significant actions to maximize cash flow.

In the first half of the year, we took actions that would have reduced our annualized 2020 operating cost base by approximately $225 million with $60 million of permanent general and administrative cost reductions.

Savings related primarily to the impact of staff reductions/furloughs, travel and expense, and a reduction in third party vendor/consulting spend.

Since this time 51% of our furloughed employees have returned to work.

We reviewed inventory and capital expenditure requirements and reduced both by a combined $133 million for the 2020 fiscal year.

Share repurchase activity has also been suspended since March 2020.

As a precautionary measure to enhance liquidity, we drew down our $1.0 billion revolving credit facility at the end of the first quarter, and subsequently issued $650 million senior secured notes, with a portion of these proceeds used to pay down borrowings under our revolving credit facility.

We also amended our revolving credit facility and term loan B, which provides flexibility during the relief period spanning from July 15, 2020 through April 1, 2022.

See Note 16— Debt to the Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K for additional details.

Given these major events, our revenues were negatively impacted and we incurred $385 million of charges related to COVID-19 during 2020, which are discussed in further detail in Note 26— COVID-19 Related Items to the Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K.

Continuing Operations

We have three branded business lines, Wyndham Destinations, Panorama, and Travel + Leisure Group.

These business lines operate independently and each umbrella business line includes multiple brands.

Wyndham Destinations is included in the Vacation Ownership (formerly Wyndham Vacation Clubs) reporting segment;

Panorama and Travel + Leisure Group are included in the Travel and Membership (formerly Vacation Exchange or Panorama) reporting segment.

• Vacation Ownership (comprised of Wyndham Destinations) , is the world’s largest timeshare ownership business with 247 resorts and 867,000 owners.

We develop, market, and sell vacation ownership interests (“VOIs”) to individual consumers, provide consumer financing in connection with the sale of VOIs, and provide property management services at resorts.

• Travel and Membership (comprised of Panorama and Travel + Leisure Group) , operates a variety of travel businesses, including three vacation exchange brands, a home exchange network, travel technology platforms, travel memberships, and direct-to-consumer rentals.

Our RCI vacation exchange business is the world’s largest and has 3.7 million members and relationships with 4,200 vacation ownership resorts located in approximately 110 countries and territories.

These businesses are primarily Fee-for-Service, selling third-party inventory that provides stable revenue streams and produces strong cash flow.

Our business segments generate a diversified revenue stream and significant cash flow.

Prior to the impacts of COVID-19, we generated 46% of our revenues from the sale of VOIs, and 40% of our revenues from our Fee-for-Service businesses.

This split was 23% and 53% in 2020 as a result of COVID-19.

We derive our fee revenues principally from (i) providing property management services to vacation ownership resorts, (ii) providing vacation exchange services, and (iii) providing services under our Fee-for-Service model in our timeshare business.

Our businesses have both domestic and international operations.

During 2020, we derived 88% of our revenues in the U.S.

and 12% internationally.

For further details on our segment revenues, profits, assets and geographical operations, see Note 24— Segment Information to the Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K.

Business Strategy

Our Travel + Leisure strategic pillars serve to clarify our top priorities in order to enhance shareholder value and return capital to our shareholders through dividends and share repurchases.

The four strategic pillars of 1.

Customer Obsession, 2.

Best-in-Class Sales & Marketing, 3.

Leading Brands & Product Innovation, and 4.

Operating Excellence, affirm our mindset that customers must dominate our focus, while also reflecting our relentless drive for superior sales and marketing, exceptional brands and products, as well as our commitment to operate all areas of the business with excellence.

Our execution of this strategy is firmly anchored by our culture - the foundation comprised of the shared values, competencies, and spirit of our global team.

Aligned with our mission to put the world on vacation, our values are the HEART of Travel + Leisure:

Hospitality, Engagement, Accountability, Respect, and Teamwork.

We recognize and appreciate our ability to positively impact the lives of our customers, associates, and the communities in which we operate.

Travel + Leisure thrives upon the commitment of our 15,500 associates, and we foster a culture that unlocks our full potential for success as a company, and as individual and team contributors.

Customer Obsession

Far beyond a hospitality initiative, Customer Obsession is our global credo that the Travel + Leisure team puts affiliates, owners, members, and guests first in all areas of our business.

Three straightforward guidelines support this focus and underscore our commitment to excellence in customer service:

• Make It Easy – we eliminate pain points across the customer lifecycle.

Aligned with our goal to put our owners, members, and guests on vacation, we are enhancing technology to make it easier to search and book reservations.

The alignment of our team, systems, and operations enables us to deliver better customer experiences.

• Know Our Customers – we use rich customer data to customize engagement.

Our investment in integrated Customer Relationship Management (“CRM”) throughout the customer lifecycle enables us to understand customer preferences, personalize engagement, and optimize sales, marketing, service and vacation experiences.

• Customer, Customer, Customer – we consider the customer experience in every decision.

We rely upon customer metrics from Net Promoter Score and Owner Engagement data across the business, and leverage surveys and customer feedback to remain responsive and relevant.

Best-in-Class Sales & Marketing

We focus on fueling the continued growth of Travel + Leisure.

We will remain globally relevant to travelers by staying committed to innovation and continuing to build and strengthen relationships with our customers.

Four core elements define our goals and align with our pledge to treat all customers with respect and integrity:

• Blue Thread – we drive revenue through our connection to Wyndham Hotels & Resorts, Inc.

(“Wyndham Hotels”) and Wyndham Rewards loyalty program customers.

The demographics of this significant consumer group are strongly aligned to our owner demographics, enabling us to grow call transfer, cross sell, and onsite marketing to fill our sales pipeline and deliver new vacation experiences to Wyndham loyalists.

• Digital & Customer Relationship Marketing – we bring timeshare to the next generation.

We will optimize technology to be relevant and compelling to meet our customers’ expectations, driving retention through Search Engine Marketing and social channels.

• Partnership Pipeline – we leverage the expertise of strategic partners to accelerate our growth and deliver enhanced benefits to our owners and members.

We will strengthen and extend existing relationships, while developing new partners to reach untapped segments.

• Sales Experience – we invest in the fundamentals as we re-imagine sales centers and processes with the customer experience in mind.

These bold transformations modernize and revitalize the customer experience and drive engagement through a single view of the customer.

Leading Brands & Product Innovation

We create a simple yet powerful narrative of who we are and what we sell supported by the launch of Travel + Leisure, and the ongoing rebranding of Wyndham Destinations’ brands including Club Wyndham and WorldMark by Wyndham, and the refreshed branding of RCI, 7Across, and Love Home Swap.

Three core elements define this strategy:

• Brand Transformation – we strive to create brand fanatics through strong positioning and differentiation.

With a clear value proposition for each of our brands, we remain relevant, and grow affinity and awareness among our diverse

owners, members, and prospects.

• Network Expansion – we grow our portfolio of resorts and brands, to meet the needs of our customers.

We prioritize geographies that will create new leads around the world, and add depth in existing markets.

• Product Innovation – we are investing in brands and technology that will help us launch new products and services which target different demographics from our traditional timeshare demographic.

We are launching products and services which appeal to younger demographics seeking increased flexibility with their travel options.

Examples include, shorter-term products as well as travel clubs.

• Panorama Growth – we leverage our strengths to expand the business into the broader travel market aligned with our strategy to become a leading travel membership provider.

We are enhancing the membership experience, and developing new offerings with wide appeal to broaden our demographic reach and grow market share.

Operating Excellence

Operating Excellence is the business engine that enables our delivery of great vacations and optimal performance through aligned operations.

Two core elements drive this strategy:

• Resort Operating Excellence – we deliver great vacation experiences to our owners, members, and guests.

The strategic deployment of capital and reserves to maintain top quality resorts, combined with our optimal use of inventory, drives this cycle of excellence.

• Prioritization – we operate with discipline as an integrated company.

Our alignment around prioritized work and our management of general, administrative, and overhead expenses relative to revenue growth fuels efficiency and effectiveness.

In summary, we believe that the successful execution of our business strategy will allow us to increase cash flows and profitability, creating more value for our shareholders.

is the world’s leading membership and leisure travel company, with nearly 20 travel brands across our resort, travel club, and lifestyle portfolio.

We provide vacation experiences and travel inspiration to millions of owners, members, and subscribers through our products and services.

Travel + Leisure Co.

has the following business lines:

• Wyndham Destinations , the world’s largest vacation ownership company with more than 245 vacation club resort locations across the globe operating under the following brands:

Club Wyndham, WorldMark by Wyndham, Shell Vacations Club, Margaritaville Vacation Club by Wyndham, and Presidential Reserve by Wyndham.

• Panorama , the world’s foremost membership travel business that includes the largest vacation exchange company, RCI, and Panorama Travel Solutions, which operates business-to-business (“B2B”) travel membership programs.

The following brands operate under the Panorama business line:

RCI, Panorama Travel Solutions, Alliance Reservations Network (“ARN”), 7Across, The Registry Collection, and Love Home Swap.

• Travel + Leisure Group , which offers travel services featuring top travel content and expertise, including Travel + Leisure Club, Travel + Leisure GO, and Extra Holidays.

History and Development

Our corporate history can be traced back to the formation of Hospitality Franchise Systems (“HFS”) in 1990.

HFS initially began as a hotel franchisor that later expanded to include the addition of the vacation exchange business.

In December 1997, HFS merged with CUC International, Inc.

2 unchanged sentences

On August 1, 2006, we commenced “regular way” trading on the New York Stock Exchange (“NYSE”) under the symbol WYN.

On May 31, 2018 (the “Distribution Date”), we established Wyndham Destinations, Inc.

and completed the spin-off of our hotel business into a separate publicly traded company, Wyndham Hotels.

This transaction was effected through a pro rata distribution of the new hotel entity’s stock to shareholders at the time of Wyndham Worldwide (the “Distribution”).

In connection with the Spin-off, we entered into certain agreements with Wyndham Hotels to implement the legal and structural separation, govern the relationship between our company and Wyndham Hotels up to and after the completion of the separation, and allocate various assets, liabilities and obligations, including, among other things, employee benefits, intellectual property, and tax-related assets and liabilities between us and Wyndham Hotels.

The two public companies have entered into long-term exclusive license agreements to retain their affiliations with one of the industry’s top-rated loyalty programs, Wyndham Rewards, as well as to continue to collaborate on inventory-sharing and customer cross-selling initiatives.

RCI, our vacation exchange business, was established in 1974.

Our vacation ownership brands began operations in 1978 with Shell Vacations Club, followed by Wyndham Vacation Resorts (formerly known as Fairfield Resorts) in 1978, and WorldMark by Wyndham (formerly known as Trendwest Resorts) in 1989.

As noted above under Company Overview, on January 5, 2021, we acquired the Travel + Leisure brand and all related assets from Meredith.

The aggregate purchase price was $100 million, comprised of $35 million in cash paid at closing, with trailing payments through June 2024.

The acquisition included Travel + Leisure’s travel clubs and their nearly 60,000 members.

On May 31, 2018, we established Wyndham Destinations, Inc.

and completed the spin-off of our hotel business (“Spin-off”) into a separate publicly traded company, Wyndham Hotels & Resorts, Inc.

(“Wyndham Hotels”).

This transaction was effected through a pro rata distribution of the new hotel entity’s stock to shareholders of Wyndham Worldwide (the “Distribution”).

In connection with the Spin-off, we entered into certain agreements with Wyndham Hotels.

See “ Key Agreements Related to the Spin-Off ” for more information.

The two public companies have also entered into long-term exclusive license agreements to retain their affiliations with one of the industry’s top-rated loyalty programs, Wyndham Rewards, as well as to continue to collaborate on inventory-sharing and customer cross-selling initiatives.

On January 5, 2021, we acquired the Travel + Leisure brand and all related assets from Meredith Corporation (“Meredith”).

The acquisition created a strategic alliance between Travel + Leisure Co.

and Meredith, with Meredith continuing to operate and monetize Travel + Leisure’s multi-platform media assets across multiple channels under a 30-year royalty-free, renewable licensing relationship.

We also agreed to a five-year marketing commitment across Meredith’s portfolio of brands.

and Meredith, with Meredith continuing to operate and monetize Travel + Leisure branded multi-platform media assets across multiple channels under a 30-year royalty-free, renewable licensing relationship.

In connection with this acquisition, on February 17, 2021, Wyndham Destinations, Inc.

was renamed Travel + Leisure Co.

and will continue to trade on the NYSE under the new ticker symbol TNL.

Our portfolio of well-known hospitality brands was assembled over the past 31 years.

The following is a timeline of some of our acquisitions:

Year Acquisition

1996 Resort Condominiums International (RCI)

2001 Wyndham Vacation Resorts

2002 WorldMark by Wyndham

2012 Shell Vacations Club

2017 Love Home Swap

7Across, formerly DAE Global Pty Ltd

2019 Alliance Reservations Network

2021 Travel + Leisure

and continues to trade on the NYSE under the new ticker symbol TNL.

See Note 5— Acquisitions to the Consolidated Financial Statements for more information.

Business Strategy

We are primarily focused on leisure travel and our mission is to “Put the World on Vacation.” Travel + Leisure Co.

has been a leader in the travel membership business for over 50 years.

Our strategy is to accelerate growth of our global businesses by broadening the strength of our cornerstone timeshare and exchange businesses and creating depth of leisure travel products and services through our business extensions, Panorama Travel Solutions and the Travel + Leisure Group.

BUSINESS DESCRIPTIONS

The following is a description of our two reporting segments, Vacation Ownership and Travel and Membership, and the industries in which they compete.

We report results of operations for our three umbrella business lines in the following financial reporting segments, which are described in more detail below:

• Vacation Ownership, comprised of Wyndham Destinations.

• Travel and Membership , comprised of Panorama and the Travel + Leisure Group.

Our business segments generate diversified revenue streams and significant cash flow.

Prior to COVID-19, we generated 46% of our revenues from the sale of vacation ownership interests, and 40% of our revenues from our Fee-for-Service businesses.

This split was 23% and 53% in 2020 as a result of COVID-19, partially recovering to 38% and 48% in 2021.

Our businesses have both domestic and international operations.

During 2021, we derived 88% of our revenues in the United States (“U.S.”) and 12% internationally.

For further details on our segment revenues, profits, assets and geographical operations, see Note 24— Segment Information to the Consolidated Financial Statements.

VACATION OWNERSHIP

The vacation ownership industry, also referred to as the timeshare industry, enables consumers to share ownership of a fully-furnished vacation accommodation.

Typically, the consumer purchases either a title to a fraction of a unit or a right to use a property for a specific period of time.

This is referred to as a vacation ownership interest.

VOIs are generally sold through weekly interval or points-based systems.

Under a weekly interval system, owners can use a specific unit at a specific resort often during a specific week of the year.

Under a points-based system, owners often have advance reservation rights for a particular destination, but are free to redeem their points for various unit types and/or locations.

The vacation ownership industry, also referred to as the timeshare industry, enables consumers to share ownership of fully-furnished vacation accommodations.

Typically, the consumer purchases either a title to a fraction of a unit through a points-based system or a right to use a property for a specific period of time through a weekly interval system.

This is referred to as a vacation ownership interest (“VOI”).

Under a points-based system, owners often have advance reservation rights for a particular destination, and are free to redeem their points for various unit types and/or locations.

In addition, points-owners can vary the length and frequency of product utilization.

Once point values are established for particular units, they generally cannot be changed.

For many purchasers, vacation ownership is an attractive alternative to traditional lodging accommodations at hotels.

In addition to avoiding variability in room rates, timeshare owners also enjoy accommodations that are, on average, more than twice the size and typically have more features than traditional hotel rooms, such as kitchens, separate living areas, and in-unit laundry.

According to a 2021 report issued by the American Resort Development Association, domestic vacation ownership sales were $4.9 billion during 2020.

The pandemic impacted key industry performance measures in 2020 and industry sales decreased for

the first time in more than a decade.

In 2019, domestic vacation ownership interest sales were $10.5 billion and in 2018, industry sales were $10.2 billion.

Typically, developers sell VOIs for a fixed purchase price that is paid in full at closing or financed through developer-offered financing options.

5 unchanged sentences

This fee typically covers expenses such as housekeeping, landscaping, taxes, insurance, resort labor, a management fee payable to the management company, and an assessment to fund a reserve account used to renovate, refurbish and replace furnishings, appliances, common areas and other assets, such as structural elements and equipment, as needed over time.

Owners typically reserve their usage of vacation accommodations in advance through a reservation system.

These reservation systems are often provided by the management company or an affiliated entity.

Market awareness and acceptance of vacation ownership products has grown with the entrance into the market of well-known lodging and entertainment brands such as Wyndham, Marriott, Hilton, and Disney.

Additionally, the industry’s growth can also be attributed to stronger consumer protection laws and the evolution from primarily weekly intervals systems to points-based systems.

According to the American Resort Development Association (“ARDA”), a trade association representing the vacation ownership and resort development industries, industry-wide sales were divided 80.9% for points-based systems and 19.1% for weekly intervals in 2019.

Based on published industry data, the primary reasons owners have expressed for buying and continuing to own their timeshare are as follows:

Based on published industry data, owners express the following primary reasons for buying and continuing to own their timeshare:

• saving money on future vacation costs;

• location of resorts;

• overall flexibility by allowing them the ability to use different locations, unit types, and times of year;

• overall flexibility to use different locations, unit types, and times of year;

• certainty of vacations;

• certainty of quality accommodations.

According to a 2020 report issued by ARDA, domestic vacation ownership sales were $10.5 billion in 2019, compared to $10.2 billion in 2018.

Demographic factors explain, in part, the continued appeal of vacation ownership.

A 2018 study of recent U.S.

vacation ownership purchasers indicated that the average timeshare owner is 44 years old and has an average annual household income of $86,000.

More than half of the respondents indicated they plan to buy or upgrade a timeshare over the next two years.

This, along with other industry data, suggests that the typical purchaser in the U.S.

has disposable income and is interested in purchasing vacation products.

The data also suggests that millennials’ perception of the industry and primary reasons for buying their timeshare is similar to the overall population of owners;

however, they seek even more flexibility in using and accessing the product.

Most owners can exchange their timeshare unit through exchange companies and through the applicable vacation ownership company’s internal network of properties.

Vacation Ownership Overview

Our Vacation Ownership reporting segment is comprised of our Wyndham Destinations branded business line, which is the world’s largest vacation ownership business.

Our Vacation Ownership reportable segment is comprised of our Wyndham Destinations branded business line, which is the world’s largest vacation ownership business.

We develop and acquire vacation ownership resorts, market and sell VOIs, provide consumer financing for the majority of the sales, and provide property management services to property owners’ associations.

As of December 31, 2020, we had 247 vacation ownership resorts in the U.S., Canada, Mexico, Caribbean, and Asia Pacific that represent over 26,000 individual vacation ownership units and 867,000 owners of VOIs.

Our brands primarily operate points-based vacation ownership systems through which VOIs can be redeemed for vacations that provide owners with flexibility as to resort location, length of stay, number of stays, unit type, and time of year.

As of December 31, 2021, we had more than 245 vacation ownership resorts in the U.S., Canada, Mexico, Caribbean, and Asia Pacific that represent over 26,000 individual vacation ownership units and 833,000 owners of VOIs.

Our programs allow us to market and sell our vacation ownership products in variable quantities and to offer existing owners “upgrade” sales to supplement their existing VOIs.

Although we offer separate brands, we have integrated substantially all of the business functions, including consumer finance, information technology, staff functions, product development, and marketing activities.

Our goal is to strengthen our leadership position in the vacation ownership industry and generate consistent and long-term value for our shareholders.

To achieve this goal, we intend to pursue the following strategies:

Optimize the revenue potential of our existing owner base as well as enhance our upgrade pipeline through the addition of new owners.

We have strong embedded revenue potential through our existing owner base:

owners upgrade as vacation needs evolve.

We earn interest revenue on our portfolio as well as club and resort management fees.

We also seek to enhance our future upgrade pipeline through sales to new owners.

On average, new owners double their initial VOI purchase within six years, resulting in predictable, high-margin future revenue streams.

Maximize our relationship with Wyndham Hotels.

We have a long-term, exclusive license agreement and marketing arrangements with Wyndham Hotels, the world’s largest hotel franchiser with approximately 9,000 affiliated hotels located in approximately 95 countries.

The Wyndham loyalty program, Wyndham Rewards, has over 92 million enrolled members, many of whom fit our target new-customer demographic, providing us with a substantial customer sourcing opportunity to drive future VOI sales.

We plan to increase this sales channel with initiatives such as enhanced call transfers, online marketing, in-hotel marketing, and online rentals of vacation ownership resorts.

Volume per guest on affinity marketing tours is higher than other tours, helping to increase margins on new owner sales.

Add leisure or hospitality brands to our existing portfolio.

The addition of brands will help us expand in existing markets or extend into new markets.

New brands will also help with lead generation for new owner tours.

Maintain a capital-efficient inventory sourcing strategy to produce attractive returns and cash flow .

We have a diverse inventory sourcing model, including self-developed inventory, Just-in-Time inventory, Fee-for-Service inventory, consumer

loan defaults, and inventory reclaimed from owners’ associations or owners that allow us to generate VOI sales.

Our capital-efficient inventory sourcing strategy has significantly increased return on invested capital since 2010.

Revenues and Operating Statistics

1 unchanged sentence

Performance in our vacation ownership business is measured by the following key operating statistics:

• Gross vacation ownership interest sales or VOIs - Sales of VOIs including Fee-for-Service sales, before the effect of loan loss provisions.

• Gross vacation ownership interest sales — Sales of VOIs including Fee-for-Service sales, before the effect of loan loss provisions.

• Tours — Number of tours taken by guests in our efforts to sell VOIs.

• Volume per guest (“VPG”) — Gross VOI sales (excluding tele-sales upgrades, which are non-tour upgrade sales) divided by the number of tours.

We have excluded non-tour upgrade sales in the calculation of VPG because non-tour upgrade sales are generated by a different marketing channel.

Vacation Ownership Brands

We operate under the following brands under Wyndham Destinations:

Club Wyndham .

As one of Wyndham Destinations’ flagship vacation ownership brands, Club Wyndham gives travelers the chance to live their bucket list and seek new adventures along the way.

Spacious suites feature fully equipped kitchens, separate living and dining areas, separate bedrooms, and on-site recreation facilities.

Club Wyndham lets travelers experience the best of what the world has to offer, with 150 resorts in top destinations across North America, Asia Pacific, and the Caribbean.

WorldMark by Wyndham .

WorldMark promises families more time to be together and more time for new traditions and new discoveries at a resort that feels like home.

WorldMark suites provide all the amenities families need - including

fully equipped kitchens, separate living and dining areas, separate bedrooms, and a washer/dryer.

WorldMark by Wyndham offers a flexible vacation portfolio, with nearly 100 resorts in a variety of destinations across the U.S., Canada, and Mexico.

Shell Vacations Club .

With a 40-year tradition of hospitality and service, Shell Vacations Club members have access to vacation ownership resorts and properties in the heart of culturally rich metropolitan areas, serene mountain communities, and relaxed coastal resort cities.

Shell Vacations Club’s 25 condo-style resorts are located throughout the U.S.

western seaboard, Canada, and Mexico.

Margaritaville Vacation Club by Wyndham .

Inspired by the laid-back, adventurous lifestyle of Jimmy Buffett and the escapism of Margaritaville ® .

Margaritaville Vacation Club delivers a tropical experience through accommodations with a nautical feel, including fully equipped kitchens with a bar area complete with a Frozen Concoction Maker ® and relaxing outdoor seating areas.

Margaritaville Vacation Club properties include St.

Virgin Islands;

Rio Mar, Puerto Rico;

and Nashville, Tennessee.

Presidential Reserve by Wyndham .

Travelers seeking an enhanced vacation experience distinguished by luxurious suites, upgraded amenities, priority access, and other special benefits will enjoy the first-class experiences provided by Presidential Reserve by Wyndham.

Our multi-brand strategy allows us to deliver a broad range of vacation ownership products, locations, and price points to a wide spectrum of travelers.

Likewise, it also allows us to pursue development opportunities in a wide range of destinations, including international and urban markets.

Having a diverse brand portfolio means we can select the most appropriate brand and development partners to expand our footprint.

We have used this advantage to build the largest global footprint in the timeshare industry, with resorts across North America, Asia, the South Pacific, and Caribbean.

Domestic International

Resorts Units Resorts Units Total Resorts Total Units

Club Wyndham 101 13,935 49 1,887 150 15,822

WorldMark by Wyndham 87 7,075 10 575 97 7,650

Presidential Reserve by Wyndham 18 393 — — 18 393

Shell Vacations Club 22 1,934 3 292 25 2,226

Margaritaville Vacation Club 3 213 — — 3 213

Total (including dual-branded resorts) 231 23,550 62 2,754 293 26,304

Dual-branded resorts (46)

Total resorts 247

We have excluded non-tour upgrade sales in the calculation of VPG because they are generated by a different marketing channel.

Sales and Marketing

2 unchanged sentences

We operate a tele-sales program designed to market upgrade sales to existing owners of our products.

Sales of VOIs relating to upgrades represented 73% and 63% of our net VOI sales during 2020 and 2019.

We use a variety of marketing programs to attract prospective owners, including sponsored contests that offer vacation packages or gifts, targeted mailings, outbound and inbound telemarketing efforts, and in association with Wyndham Hotels brands, other co-branded marketing programs and events.

We also partner with Wyndham Hotels by utilizing the Wyndham Rewards loyalty program to offer Wyndham Rewards points as an incentive to prospective VOI purchasers, and by providing additional redemption options to Wyndham Rewards members.

We co-sponsor sweepstakes, giveaways and promotional programs with professional teams at major sporting events, and with other third parties at high-traffic consumer events.

Where permissible under state law, we offer cash awards or other incentives to existing owners for referrals of new owners.

New owner acquisition is an important strategy for us as this will continue to maintain our pool of “lifetime” buyers of vacation ownership and thus enable us to solicit upgrade sales in the future.

We added 12,000 and 36,000 new owners during 2020 and 2019.

New owner acquisition in 2020 was negatively impacted by COVID-19 related closures of our resorts and sales centers.

In total VOI upgrade sales represented 72% and 73% of our net VOI sales in 2021 and 2020.

Our marketing and sales activities are often facilitated through marketing alliances with other travel, hospitality, entertainment, gaming, and retail companies that provide access to such companies’ customers through a variety of co-branded marketing offers.

1 unchanged sentence

Our marketing agents, who often operate on the premises of the hospitality, entertainment, gaming, and retail companies with which we have alliances, solicit tourists with offers relating to entertainment activities and other incentives in exchange for the tourists visiting the local resorts and attending sales presentations.

We offer a variety of entry-level programs and products as part of our sales strategy.

For example, we have a program that allows prospective owners a one-time allotment of points or credits with no further obligations, which we refer to as our sampler program, and a biennial product that provides for vacations every other year.

As part of our sales strategies, we rely on our points/credits-based programs, which provide prospective owners with the flexibility to buy relatively small packages of points or credits which can then be upgraded at a later date.

To facilitate upgrade sales among existing owners, we market opportunities for owners to purchase additional points or credits through periodic marketing campaigns and promotions while those owners vacation at our properties.

Purchaser Financing

Consumer Financing

We offer financing to purchasers of VOIs which attracts additional customers and generates substantial incremental revenues and profits.

1 unchanged sentence

Wyndham Consumer Finance performs loan financing, servicing, and related administrative functions.

We typically perform a credit investigation or other inquiry into every purchaser’s credit history before offering to finance a portion of the purchase price of the VOI.

We typically perform a credit investigation or other inquiry into a purchaser’s credit history before offering to finance a portion of the purchase price of the VOI.

The interest rate offered to participating purchasers is determined by an automated underwriting process based upon the purchaser’s credit score and the amount of the down payment.

We use a consumer credit score, Fair Isaac Corporation (“FICO”), which is a branded version of a consumer credit score widely used within the U.S.

by the largest banks and lending institutions.

FICO scores range from 300 to 850 and are calculated based on information obtained from one or more of the three major U.S.

credit reporting agencies that compile and report on a consumer’s credit history.

For purchasers with large loan balances, we maintain higher credit standards for new loan originations.

Our weighted average FICO score on new originations was 736 and 735 for 2021 and 2020.

During 2020, we generated $481 million of new receivables on $920 million of gross vacation ownership sales, net of Fee-for-Service sales, resulting in 52.3% of our vacation ownership sales being financed.

During 2021, we generated $780 million of receivables on $1.31 billion of gross VOI sales, net of Fee-for-Service sales, resulting in 60% of our VOI sales being financed.

This level of financing is prior to the receipt of addenda cash.

Addenda cash represents the cash received for full payment of a loan within 15 to 60 days of origination.

After the application of addenda cash, we financed 50.9% of vacation ownership sales during 2020.

We generally require a minimum down payment of 10% of the purchase price on all sales of VOIs and offer consumer financing for the remaining balance for up to 10 years.

While the minimum down payment is generally 10%, our average down payment on financed sales of VOIs was 25% and 24% for 2020 and 2019.

After the application of addenda cash, we financed 53% of VOI sales during 2021.

We generally require a minimum down payment of 10% of the purchase price on all VOI sales and offer consumer financing for the remaining balance for up to 10 years.

While the minimum down payment is generally 10%, our average down payment on financed VOI sales was 24% and 25% for 2021 and 2020.

These loans are structured with equal monthly installments that fully amortize the principal by the final due date.

Similar to many other companies that provide consumer financing, we have historically securitized a majority of the receivables originated in connection with the sales of VOIs.

Similar to many other companies that provide consumer financing, we have historically securitized a majority of the receivables originated in connection with the sale of VOIs.

We initially place the financed contracts into a revolving warehouse securitization facility, generally within 30 to 90 days after origination.

Many of the receivables are subsequently transferred from the warehouse securitization facility and placed into term securitization facilities.

Our consumer financing subsidiary is responsible for the maintenance of contract receivables files as well as all customer service, billing, and collection activities related to the domestic loans we extend.

Many of the receivables are subsequently transferred from the warehouse securitization facility into term securitization facilities.

Our consumer financing subsidiary is responsible for the maintenance of contract receivables files as well as all customer service, billing, and collection activities related to our domestic loans.

We assess the performance of our loan portfolio by monitoring numerous metrics including collection rates, defaults by state of residency, and bankruptcies.

4 unchanged sentences

The terms of the property management agreements are generally between three to five years;

however, the vast majority of the agreements provide a

mechanism for automatic renewal upon expiration of the terms.

however, the vast majority of the agreements provide a mechanism for automatic renewal upon expiration of the terms.

In connection with these property management services, we receive fees which are generally based upon total costs to operate such resorts.

1 unchanged sentence

As the owner of unsold VOIs, we pay maintenance fees in accordance with the legal requirements of the jurisdictions in which the resorts are located.

In addition, at certain newly-developed resorts, we sometimes enter into subsidy agreements with the property owners’ associations to cover costs that otherwise would be covered by annual maintenance fees payable with respect to VOIs that have not yet been sold.

Inventory Sourcing

We sell inventory sourced primarily through five channels:

• self-developed inventory;

• Just-in-Time inventory;

• Fee-for-Service;

• consumer loan defaults;

• inventory reclaimed from owners’ associations or owners.

Self-developed inventory.

Under the traditional timeshare industry development model, we develop inventory specifically for our timeshare sales.

The process often begins with the purchase of land which we then develop.

Depending on the size and complexity of the project, this process can take up to several years, but usually takes less.

Just-in-Time inventory .

Our Just-in-Time inventory acquisition model enables us to acquire and own completed units close to the timing of their sale or to acquire completed inventory from a third-party partner based upon a predetermined purchase schedule.

This model significantly reduces the period between the deployment of capital to acquire inventory and the subsequent return on investment which occurs at the time of its sale to a timeshare purchaser.

Fee-for-Service.

In 2010, we introduced the first of our Fee-for-Service models.

This timeshare sourcing model was designed to capitalize upon the large quantities of newly developed, nearly completed, or recently finished condominium or hotel inventory in the real estate market without assuming the risk that accompanies property acquisition or new construction.

This business model offers turn-key solutions for developers or banks in possession of newly developed inventory, which we sell for a fee through our extensive sales and marketing channels.

Fee-for-Service enables us to expand our resort portfolio with little or no capital deployment, while providing additional channels for new owner acquisition and growth for our Fee-for-Service property management business.

Consumer loan defaults.

As discussed in the “Purchaser Financing” section, we offer financing to purchasers of VOIs.

In the event of a default, we are able to recover the inventory and resell it at full current value.

We are responsible for the payment of maintenance fees to the property owners’ associations until the product is sold.

As of December 31, 2020, Inventory on the Consolidated Balance Sheets included estimated inventory recoveries on loan defaults of $246 million.

Inventory reclaimed from owners’ associations or owners.

We have entered into agreements with a majority of the property associations representing our developments where we may acquire properties related to owners who have defaulted on their maintenance fees, provided there is no outstanding debt on such properties.

In addition, we frequently work with owners to acquire their properties, provided they have no outstanding debt on such properties, prior to those owners defaulting on their maintenance fees.

This provides the owner with a graceful exit from a property that is no longer utilized due to lifestyle changes.

Our goal is to strengthen our leadership position in the vacation ownership industry and generate consistent and long-term value for our shareholders.

To achieve this goal, we intend to pursue the following strategies:

Use our diverse brands to enter new and underpenetrated geographies and broaden our demographic reach .

Our unique mix of brands coupled with our large, global footprint provides us with a strategic advantage when adding new inventory in target markets.

We expect to use this advantage to grow our customer base by expanding our product offerings in existing markets and entering new, underpenetrated markets.

In our existing markets, we intend to grow our product offerings by adding new brands, either within an existing resort or at a new development.

By having multiple brands within a single location, we are able to offer different products at different price points, thereby increasing our addressable market.

For example, in Las Vegas, our second and third brands represent over 51%

of our sales.

In Nashville, our ability to offer a lifestyle brand, Margaritaville Vacation Club by Wyndham, resulted in our selection as a partner in a new hotel development in the popular “SoBro” district.

The breadth of our offerings also allows us to enter new markets with the appropriate brand and product mix.

For example, in one of our newest timeshare markets, Austin, we offer two products, one targeted to new owners and the other targeted to existing owners, which allows us to appeal to a broader audience of customers.

Additionally, we use our brand portfolio, combined with our strong sales and marketing platform, to penetrate non-traditional but attractive timeshare markets such as the Wisconsin Dells, where we are the only major hospitality brand.

Increase new owner sales to drive long-term growth .

As part of our strategy, we seek to increase the percentage of our VOI sales from new owners, which will enable us to drive long-term revenue and earnings growth.

On average, new owners double their initial VOI purchase within six years, resulting in predictable, high-margin future revenue streams.

We plan to leverage our industry-leading sales and marketing platform to attract new owners by expanding our call transfer capabilities, leveraging our relationship with Wyndham Hotels, enhancing our marketing alliances, growing our Community Marketing Presence (“CMP”), and adding resorts in new markets.

Maximize our relationship with Wyndham Hotels .

We have a long-term, exclusive license agreement and marketing arrangements with Wyndham Hotels, the world’s largest hotel franchiser, based on number of properties, with 20 iconic brands and more than 8,900 affiliated hotels located in nearly 95 countries.

The Wyndham loyalty program, Wyndham Rewards, has earned accolades as the world’s most generous loyalty program, spanning more than 30,000 hotels, vacation club resorts, and vacation rentals globally.

For the third consecutive year, in 2020, Wyndham Rewards was recognized as the best hotel loyalty program in the USA Today 10Best Readers’ Choice Awards.

We plan to significantly increase this sales channel with initiatives such as enhanced call transfers, online marketing, in-hotel marketing, and online rentals of vacation ownership resorts.

In addition, Wyndham Rewards redemption options into our resorts provide enhanced tour flow opportunities.

Cross-marketing to existing guests of Wyndham Hotels and members of Wyndham Rewards has proven to be more efficient than traditional marketing efforts.

VPG on affinity marketing tours is higher than other tours, helping to increase margins on new owner sales.

We believe further developing this affinity relationship, which currently represents only a small portion of VOI sales, offers a significant new owner growth opportunity that is more profitable than other new owner marketing channels.

Wyndham Rewards, with over 86 million enrolled members, many of whom fit our target new customer demographic, provides us with a substantial customer sourcing opportunity to drive future VOI sales.

Maintain a capital-efficient inventory sourcing strategy to produce attractive returns and cash flow .

Vacation Ownership pioneered capital-efficient inventory sourcing in 2010.

We have a diverse inventory sourcing model, including self-developed inventory, Just-in-Time inventory, Fee-for-Service inventory, and buyback programs that allow us to generate VOI sales.

Our capital-efficient inventory sourcing strategy has significantly increased return on invested capital since 2010.

The scale and breadth of our brand and product offerings give us unparalleled access to inventory sources, including innovative capital-efficient opportunities, which gives us the ability to select the most attractive development options.

In addition, at certain newly-developed resorts, we may enter into subsidy agreements with the property owners’ associations to cover costs that otherwise would be covered by annual maintenance fees payable with respect to VOIs that have not yet been sold.

We rely, in part, upon tour flow to generate sales of VOIs;

consequently, sales volume tends to increase in the spring and summer months as a result of greater tour flow from spring and summer travelers.

Therefore, revenue from sales of VOIs are generally higher in the third quarter than in other quarters.

Our vacation ownership business competes with other timeshare developers for sales of VOIs based principally on location, quality of accommodations, price, service levels and amenities, financing terms, quality of service, terms of property use, reservation systems, flexibility for members to exchange into time at other timeshare properties or other travel rewards, including access to hotel loyalty programs, as well as brand name recognition and reputation.

We also compete for property acquisitions and partnerships with entities that have similar investment objectives as we do.

consequently, sales volume tends to increase in the spring and summer months as a result of greater tour flow from travelers, generally resulting in higher revenue from sales of VOIs in the third quarter than in other quarters.

Our seasonality has been and could continue to be impacted by COVID-19.

Our vacation ownership business principally competes with short-term vacation options such as lodging, cruise and home and apartment sharing services, as well as other timeshare developers.

The leisure travel industry is large and highly competitive.

We compete based on lifetime value, location, convenience, quality of accommodations, service levels, amenities, and flexibility.

In order to compete, we incent potential new owners and existing owners to tour with us in order to better understand our products and services.

The vacation ownership industry has consolidated over the last 15 years leaving multiple well-capitalized, branded companies including:

Marriott Vacations Worldwide, Hilton Grand Vacations, Disney Vacation Club, Holiday Inn Club Vacations, and Bluegreen Vacations.

As an industry, we largely source potential new owner tours from different marketing channels, but there is overlap when consumers are members of more than one loyalty program and/or travel to more than one resort within a market.

We compete for property acquisitions and partnerships with entities that have similar investment objectives.

There is also significant competition for talent at all levels within the industry, in particular for sales and management.

Competitors range from small, independent vacation ownership companies, to large branded hospitality companies, all operating vacation ownership businesses involved in the development, finance, and operation of timeshare properties.

Our primary competitors in the

timeshare space include Marriott Vacations Worldwide, Hilton Grand Vacations, Disney Vacation Club, Holiday Inn Club Vacations, Bluegreen Vacations, and Diamond Resorts International.

In addition, our timeshare business competes with other entities engaged in the leisure and vacation industry, including resorts, hotels, cruises and other accommodation alternatives, such as condominium and single-family home rentals.

We also compete with home and apartment sharing services (such as Airbnb and VRBO) that operate websites that market privately owned residential properties that can be rented on a nightly, weekly or monthly basis.

In certain markets, we compete with established independent timeshare operators, and it is possible that other potential competitors may develop properties near our current resort locations.

In addition, we face competition from other timeshare management companies in the management of resorts on behalf of owners on the basis of quality, cost, types of services offered and relationship.

The timeshare industry has experienced significant consolidation over the last fifteen years, which may increase competition.

Additionally, competition in the vacation ownership industry may increase as private competitors become publicly traded companies or existing publicly traded competitors spin-off their vacation ownership operations, increasing the number of competitors in a highly fragmented industry.

For example, in September 2018, Marriott Vacations Worldwide acquired Interval Leisure Group, Inc., which operates the Interval International exchange program.

Prior to that acquisition, Interval Leisure Group, Inc.

had acquired Hyatt Residence Club in October 2014 and the timeshare operations of Starwood Hotels & Resorts Worldwide, Inc.

in May 2016 (which includes the use of Westin and Sheraton brands for timeshare purposes), known as Vistana Signature Experiences, Inc.

Diamond Resorts International, Inc.

completed the acquisition of the timeshare business of Gold Key Resorts in October 2015 and the timeshare business of Intrawest Resort Club Group in January 2016.

Most recently, in January 2021, Marriott Vacations Worldwide announced an agreement to acquire Welk Resorts.

In January 2017, Hilton Worldwide Holdings Inc.

completed the spin-off of its vacation ownership operations and Hilton Grand Vacations Inc.

is now a separate publicly traded company.

In November 2017, Bluegreen Vacations Corporation completed an initial public offering that resulted in approximately 10% of its stock being held by the public.

Competitors that are publicly traded companies may benefit from a lower cost of, and greater access to, capital, as well as more focused management attention.

Consolidation may create competitors that enjoy significant advantages resulting from, among other things, a lower cost of, and greater access to, capital and enhanced operating efficiencies.

We generally do not face competition in our consumer financing business to finance sales of our VOIs.

We generally do not face competition in our consumer financing business to finance our VOI sales.

We do face competition from financial institutions providing other forms of consumer credit, which may lead to full or partial prepayment of our timeshare financing receivables.

TRAVEL AND MEMBERSHIP

A large segment of worldwide leisure travel is delivered through non-traditional channels that provide broader options and flexibility, including vacation exchange and travel memberships.

These non-traditional accommodations provide leisure travelers with flexibility and access to a wide variety of accommodation options that include membership platforms, such as timeshare exchange, closed user group, and home exchange.

Travel and membership is a Fee-for-Service industry that offers services and products through several business to business (“B2B”) and business to consumer (“B2C”) channels, including timeshare developers and owners, white-labeled third party travel clubs and also directly to travel club members.

Vacation Exchange.

To participate in a vacation exchange, generally a timeshare owner deposits their interval from a resort, or points from their club or resort, into a vacation exchange company’s network thereby receiving the opportunity to use another owner’s interval at a different destination.

The vacation exchange company assigns a value to the owner’s deposit based upon a number of factors, including supply and demand for the destination, size of the timeshare unit, dates of the interval, and the amenities at the resort.

Vacation exchange companies generally derive revenues by charging fees for facilitating vacation exchanges and through annual membership dues.

Vacation ownership clubs, such as Club Wyndham, WorldMark by Wyndham, Hilton Grand Vacations, and Disney Vacation Club, give members the option to exchange both internally within their collection of resorts, or externally through vacation

exchange networks such as RCI.

Memberships in such clubs have been the largest driver of vacation ownership industry growth over the past several years.

This long-term trend has a positive impact on the average number of exchange members, but negatively impacts the number of vacation exchange transactions per member and revenue per member for vacation exchange companies as members exchange more often within their respective clubs.

Travel and Membership Overview

Our Travel and Membership segment is comprised of our branded business lines, Panorama and Travel + Leisure Group, which operates a variety of travel businesses, including three vacation exchange brands, a home exchange network, travel technology platforms, travel memberships and direct-to-consumer rentals.

Our Travel and Membership segment is comprised of our branded business lines, Panorama and the Travel + Leisure Group, which operate a variety of travel businesses, including three vacation ownership exchange brands, travel clubs, direct-to-consumer rentals, and a home exchange network.

These businesses are primarily Fee-for-Service, selling third-party inventory that provides stable revenue streams and produces strong cash flow.

We are an internationally recognized leader in travel, and operate the world’s largest vacation exchange network based on the number of members and affiliated resorts.

We operate RCI, the world’s largest vacation exchange network based on the number of members and affiliated resorts.

Through our collection of vacation exchange brands, we have 3.7 million paid member families.

Each year, we retain more than 86% of the exchange memberships through our RCI, 7Across, and Love Home Swap networks.

Annual member retention is high and over the last three years we have retained on average 84% of the exchange memberships through our RCI, 7Across, and Love Home Swap networks.

In the vast majority of cases, we acquire new members when an affiliated timeshare developer pays for the initial term of a membership on behalf of a timeshare owner as part of the vacation ownership purchase process.

Generally, this initial membership is for either a one or two year term, after which these new members may choose to renew directly with us.

Generally, this initial membership is for either a one or two year term, after which these new members may choose to

renew directly with us.

We also acquire a small percentage of new members directly from online channels or direct consumer outreach.

1 unchanged sentence

Our vacation exchange business has relationships with 4,200 affiliated vacation ownership resorts in approximately 110 countries and territories located in North America, Latin America, the Caribbean, Europe, the Middle East, Africa, and Asia Pacific.

We tailor our strategies and operating plans for each region where we have, or seek to develop, a substantial member base.

Travel and Membership offers travel membership solutions on a B2B and B2C basis.

These travel clubs provide benefits to members including among others, discounted travel options.

Whether on a B2B basis, through Panorama Travel Solutions, or B2C through Travel + Leisure Group, our members are generally charged a membership fee and then pay an additional fee based on transactions.

Panorama Travel Solutions offers global discount travel membership clubs and custom travel technology solutions to business-to-business affinity partners including large employers, banks and retailers, trade associations and others via their operations in the U.S., Mexico, Asia, and Europe.

Our travel technology platforms are powered by Alliance Reservations Network, a Panorama company, which has been operating travel booking technology since 1995.

Members are acquired through affinity partnerships where the affinity partner would offer a travel club membership to affiliated groups, usually its customers, members and/or employees.

Following our acquisition of the Travel + Leisure brand, we established the Travel + Leisure Group to offer travelers a suite of products and services that bring the brand to life, including Travel + Leisure Club, a subscription travel club where members can dream, plan, book and go – all in one place.

Subscribers have access to preferred pricing on featured itineraries inspired by editorial coverage, personalized concierge service, extra savings on more than a million travel options, and exclusive experiences, along with a complimentary subscription to Travel + Leisure magazine.

Our goal is to grow our cornerstone vacation exchange business, optimize cash flow, and broaden our reach into the leisure travel markets to accelerate overall growth for the segment through our business extensions, Panorama Travel Solutions and the Travel + Leisure Group.

To achieve this goal, we intend to pursue the following strategies:

Expand and enhance our products and services to increase wallet share, propensity, and retention within our member base.

Through the addition of more inventory options for exchange and more travel products and services, Panorama seeks to enhance its core exchange business lines’ growth through greater share of consumers’ travel spend, increased member engagement, and reduced churn.

Offer B2B travel club solutions.

We seek to grow our membership beyond the timeshare industry, expanding B2B partnerships across multiple sectors driving incremental transaction revenue and subscriptions.

We offer white-label solutions to associations, organizations, and other closed-user groups in order for these groups to offer travel benefits to their communities which increases engagement and loyalty.

Grow our Direct-to-Consumer (“D2C”) travel club leveraging the Travel + Leisure brand and content.

We plan to leverage Travel + Leisure, one of the world’s most influential travel brands, to expand our total addressable market and grow our subscription travel club by marketing to Travel + Leisure magazine subscribers and leisure travelers in general.

Revenues and Operating Statistics

Travel and Membership derives the majority of its revenues from annual membership dues and fees for facilitating vacation exchanges and other travel accommodations and services.

Travel and Membership derives the majority of its revenues from annual membership dues and fees for facilitating exchange and non-exchange transactions and other travel accommodations and services.

We also generate revenue from programs with affiliated resorts, club servicing, and loyalty programs, as well as additional products that provide exchange members with the ability to protect trading power or points, extend the life of deposits, and combine two or more deposits for the opportunity to exchange into intervals with higher trading power.

No single customer, developer, or group accounts for more than 10% of our revenues.

Performance in our Travel and Membership business has been measured by the following key operating statistics through 2020:

• Average number of members - Represents paid members in our vacation exchange programs who are current on their annual membership dues.

• Exchange revenue per member - Represents total revenues generated from fees associated with memberships, exchange transactions, and other servicing for the period divided by the average number of vacation exchange members during the period.

Given recent acquisitions, we will be reporting the following key operating metric for our Travel and Membership segment in 2021:

• Transactions – Represents the number of vacation transactions booked during the period, net of cancellations.

We operate under the following brands within Panorama:

Founded in 1974, RCI operates the world’s largest vacation ownership weeks-based vacation exchange network, RCI Weeks, and provides members with the ability to exchange week-long intervals in units at their home resort for intervals at comparable resorts.

RCI also operates the world’s largest vacation ownership points-based vacation exchange network, RCI

This program allocates points to use rights that members cede to the vacation exchange program.

Members may redeem their points for the use of vacation properties for the duration they choose in our vacation exchange program or for discounts on other services and products which may change from time to time, such as airfare, car rentals, cruises, hotels, and other accommodations.

RCI also offers enhanced membership tiers (Gold and Platinum), which provide additional benefits to members.

Panorama Travel Solutions.

Panorama Travel Solutions offers global discount travel membership clubs and custom travel technology solutions to B2B affinity partners including large employers, banks and retailers, trade associations and others via their operations in the U.S., Mexico, Asia, and Europe.

From off-the-shelf house brands to bespoke travel clubs, Panorama Travel Solutions delivers the perfect solution for its partners based on their unique needs.

Driven by Panorama’s vision to widen the scope of business, Panorama Travel Solutions is dedicated to growing its position within group tourism by offering new platforms and expanded products to its affinity partners.

Alliance Reservations Network.

Founded in 1995, ARN is a travel technology provider that offers private-label travel booking technology solutions to affiliates and group travel planners.

These travel booking solutions are highly configurable and offer unique benefits to our partners.

ARN’s relationships with major global travel suppliers offer substantial discounts on travel and accommodations as a benefit to closed user groups such as employee benefit programs, professional associations, and other paid membership groups.

Additionally, ARN’s group travel planning solution helps to automate the process of contracting, booking, and managing the entire lodging process for group events.

7Across, formerly DAE.

Founded in 1997, 7Across is a leading direct-to-consumer model of vacation exchange with global operations.

This member-direct vacation exchange program is open to all timeshare owners, regardless of the resort where they own.

7Across offers weeks, points, and club owners a simple exchange system with modest support services, enabling them to enjoy resort style accommodations around the world.

The Registry Collection.

Established in 2002, The Registry Collection vacation exchange program is the industry’s largest and first global vacation exchange network of luxury vacation accommodations.

The luxury vacation accommodations in The Registry Collection network include fractional ownership resorts, higher-end vacation ownership resorts, condo-hotels, and yachts.

The Registry Collection program allows members to exchange their intervals for the use of other luxury vacation properties within the network for a fee and also offers access to other services and products at member preferred rates, such as cruises, yachts, adventure travel, hotels, and other accommodations.

Love Home Swap.

Founded in 2011, Love Home Swap provides homeowners two ways to turn their home into vacation opportunities.

Members have the option to:

(i) swap time at their home directly with another member for time at their property, or (ii) swap time at their home for points, which can be used at a later date to secure a stay at another member’s home.

Love Home Swap has developed a sizeable footprint in the United Kingdom and Europe, as well as presence in the U.S.

and Australia.

We will operate the following brands under our new Travel + Leisure Group in 2021:

BookTandL.com.

This brand’s website serves as both a research and transaction platform, providing consumers a single destination for every aspect of their vacation planning and booking journey.

Travel + Leisure Travel Clubs.

This will include the two Travel + Leisure travel clubs acquired in January 2021 as well as a new subscription travel club to be launched in 2021.

Travel + Leisure Group will be launching and cultivating a number of brands and websites over the next twelve months and beyond in order to leverage the Travel + Leisure brand.

The properties our business makes available to travelers include vacation ownership and fractional resorts, homes, private residence clubs, and traditional hotel rooms.

Only in rare cases do we acquire and take title of inventory, as our network supply is owned and provided by third-party affiliates and suppliers.

We offer travelers flexibility to select preferred travel dates in a variety of lodging options.

We leverage inventory comprised of VOIs and independently owned properties across our network of brands to maximize value for affiliates and members.

Customer Development

Performance in our Travel and Membership business has been measured by the following key operating statistics:

• Average number of exchange members — Represents paid members in our vacation exchange programs who are considered to be in good standing.

• Transactions — Represents the number of vacation bookings recognized as revenue during the period, net of cancellations.

• Revenue per transaction — Represents transactional revenue divided by transactions.

Sales and Marketing, Distribution and Customer Development

In the exchange business, we affiliate with vacation ownership developers directly through our in-house sales teams.

Affiliated vacation ownership developers sign agreements that have an average duration of five years.

Affiliated vacation ownership developers sign agreements that have an average duration of three years.

Our vacation exchange members are acquired primarily through our affiliated developers as part of the vacation ownership purchase process.

We acquire a small percentage of our members directly from online channels.

We also affiliate with affinity groups outside of the vacation ownership industry, primarily through our ARN business.

These affiliates include employee benefit plans, professional associations, and other paid membership groups.

These affiliates bring end user customers to our solutions via private label booking websites, which ultimately drives revenue-generating transactions for us.

Panorama Travel Solutions seeks to develop relationships with organizations, companies, or groups that are interested in providing travel benefits to their members to enhance customer loyalty, and in many cases, generate incremental fee streams.

Panorama Travel Solutions will provide white-label services to its customers and will revenue-share or perform services for a fee, with its customers.

Travel + Leisure Group will develop relationships directly with consumers through quality content and by marketing to Travel + Leisure magazine subscribers and followers.

Loyalty Program

RCI’s loyalty program, RCI Elite Rewards, offers a co-branded credit card to members.

The card allows members to earn reward points that can be redeemed for items related to our RCI vacation exchange programs, including annual membership dues, exchange fees for transactions, and other services and products offered by RCI or certain third parties, including airlines and retailers.

Panorama collaborates with affinity groups outside of the vacation ownership industry through our Panorama Travel Solutions business, which includes ARN.

These affinity groups include employee benefit plans, professional associations, and other paid membership groups that are interested in providing travel benefits to their members to enhance customer loyalty, and in many cases, generate incremental fee streams.

The Travel + Leisure Group develops relationships directly with consumers through quality travel content and by marketing to both Travel + Leisure magazine subscribers and leisure travelers in general.

We distribute our products and services through proprietary websites and call centers around the world.

We invest in new technologies and online capabilities to ensure that our customers have the best experience and access to consistent information and services across digital and call center channels.

We continue to enhance our digital channels, mobile capabilities, and e-commerce platforms across our network.

Part of our strategy has been to enhance and expand our online distribution channels, including global partnerships with several industry-leading online travel and distribution partners in order to streamline inventory connectivity and guest experience.

This will continue to enhance our value proposition with members and accelerate revenue growth, while also allowing for more transactional business online to reduce reliance on call center support, thereby generating cost savings.

The requests we receive at our global call centers are handled by our vacation guides, who are trained to fulfill requests for vacation exchange.

Call centers remain an important vacation exchange distribution channel for us and therefore we continue to invest resources to ensure that members and rental customers receive a high level of personalized customer service.

Through our call centers, we also provide private-labeled reservation booking, customer care, and other services for our RCI affiliates.

We market our services and products to our customers using our brands in 24 offices worldwide through several marketing channels including direct mail, email, social media, telemarketing, online distribution channels, brochures, and magazines.

Our core marketing strategy is to personalize and customize our marketing to best match customer preferences.

We also have a comprehensive strategy for communicating to customers using a variety of digital and social channels such as Facebook, Google, Instagram, Twitter, Pinterest, and YouTube.

We use our resort directories and periodicals related to the vacation industry for marketing as well as for member retention and loyalty.

Our strategy is to expand beyond our core vacation exchange model into the broader leisure travel market to become a leading travel membership provider.

Our Panorama growth plan leverages our legacy of innovation, technology, and analytics expertise as well as our membership capabilities to fuel our growth and achieve our goals.

We intend to pursue the following key strategic initiatives:

Broaden our business beyond core exchange

We will continue to selectively pursue business opportunities to offer services to travelers both within and outside of our traditional member base in order to leverage our existing brands and scale, as well as enhance and grow the recently acquired ARN business.

Our goal will be to serve as a true end-to-end travel provider, illustrating our expertise across the full spectrum of travel, vacation, and holidays.

Identify new capital efficient sources of supply

We have identified consumer demand for destinations where we have limited supply.

We plan to leverage our scale, technology platforms, and robust industry relationships to secure new sources of supply with favorable pricing to enhance our inventory profile and satisfy our customer demand.

Offer new and innovative products to re-ignite our brands and further enhance the membership experience

We plan to continue our focus on Customer Obsession by offering more ways for customers to use their membership for global travel and vacations.

Our goal is to simplify the exchange process and provide a more expansive offering of quality destination options and travel products.

Develop new solutions in partnership with our club affiliates to increase overall engagement with the club member population

While club owners have been the largest growing segment of our member base, club revenue per member is lower than our overall average due to a wide array of vacation options within the clubs, causing a reduced propensity for club owners to transact with our networks.

We see opportunity to improve club engagement by working more closely with our club affiliate partners to drive additional value proposition in their owner base.

We can achieve this by enhancing our technology platforms, providing innovative new product offerings, and enabling time flexibility to help owners avoid expiration of their club currency by depositing into our exchange programs.

Customers are acquired through direct channels, partnerships with affinity groups, and third party acquisition sources.

The properties our business makes available to travelers include vacation ownership and fractional resorts, homes, private residence clubs, and traditional hotel rooms.

Only in rare cases do we acquire and take title of inventory, as our network supply is predominantly owned and provided by third-party affiliates and suppliers.

We offer travelers flexibility to select preferred travel dates in a variety of lodging options.

We leverage inventory comprised of VOIs and independently owned properties across our network of brands to maximize value for affiliates and members.

Our revenues from vacation exchange fees have traditionally been higher in the first quarter, which is generally when our vacation exchange members plan and book their vacations for the year.

Our global exchange business competes with other worldwide vacation exchange companies, most notably Interval International, certain timeshare developers and clubs that offer vacation exchange through their own internal networks of properties.

Our seasonality has been and could continue to be impacted by COVID-19.

Our global exchange business competes with other vacation exchange companies, most notably Interval International, certain timeshare developers and clubs that offer vacation exchange through their own internal networks of properties.

This business also competes with third-party internet travel intermediaries and peer-to-peer online networks that are used by consumers to search for and book their resort and other travel accommodations.

Our non-exchange Travel and Membership businesses compete more broadly with the larger universe of leisure travel options including traditional travel agents, online travel agents, and travel clubs.

Our non-exchange Travel and Membership businesses compete more broadly with the larger sector of leisure travel options including traditional travel agents, online travel agents, and travel clubs.

INTELLECTUAL PROPERTY

1 unchanged sentence

The foregoing segment descriptions specify the brands that are used by each of our segments.

Our subsidiaries actively use or license for use all significant marks and domain names, and we own or have exclusive licenses to use these marks and domain names.

In connection with the Spin-off, we entered into a license, development and noncompetition agreement with Wyndham Hotels, which, among other things, granted to Travel + Leisure the right to use the “Wyndham” trademark, “The Registry Collection” trademark, and certain other trademarks and intellectual property in our business.

Travel + Leisure Co.

and its subsidiaries actively use or license for use all significant marks and domain names, and we own or have exclusive licenses to use these marks and domain names.

In connection with the Spin-off, we entered into a license, development and noncompetition agreement with Wyndham Hotels, which, among other things, granted to Travel + Leisure Co.

the right to use the “Wyndham” trademark, “The Registry Collection” trademark, and certain other trademarks and intellectual property in our business.

See “ Key Agreements Related to the Spin-Off—License, Development and Noncompetition Agreement ” for more information.

13 unchanged sentences

and property management activities.

Inventory Sourcing Regulation

Timeshare Inventory Purchasing and Development

Our inventory sourcing activities are regulated under a number of different timeshare, condominium, and land sales disclosure statutes in many jurisdictions.

We are generally subject to laws and regulations typically applicable to real estate development, subdivision, and construction activities, such as laws relating to zoning, land use restrictions, environmental regulation, accessibility, title transfers, title insurance, and taxation.

We are generally subject to laws and regulations applicable to real estate development, subdivision, and construction activities, such as laws relating to zoning, land use restrictions, environmental regulation, accessibility, title transfers, title insurance, and taxation.

In the U.S., these include the Fair Housing Act and the Americans with Disabilities Act of 1990 and the Accessibility Guidelines promulgated thereunder.

3 unchanged sentences

In addition to regulations implementing laws enacted specifically for the timeshare industry, a wide variety of laws and regulations govern our sales and marketing activities, including regulations implementing the USA PATRIOT Act, Foreign Investment In Real Property Tax Act, the Federal Interstate Land Sales Full Disclosure Act and fair housing statutes, U.S.

Federal Trade Commission (“FTC”) and states’ “Little FTC Acts” and other regulations governing unfair, deceptive or abusive acts or practices including unfair or deceptive trade practices and unfair competition, state attorney general regulations, anti-fraud laws, prize, gift and sweepstakes laws, real estate, title agency or insurance and other licensing or registration laws and regulations, anti-money laundering, consumer information privacy and security, breach notification, information sharing and telemarketing laws, home solicitation sales laws, tour operator laws, lodging certificate and seller of travel laws, securities laws, and other consumer protection laws.

Federal Trade Commission and states’ “Little FTC Acts” and other regulations governing unfair, deceptive or abusive acts or practices including unfair or deceptive trade practices and unfair competition, state attorney general regulations, anti-fraud laws, prize, gift and sweepstakes laws, laws governing discount sales and buying clubs, real estate, title agency or insurance and other licensing or registration laws and regulations, anti-money laundering, consumer information privacy and security, breach notification, information sharing, telemarketing and email marketing laws, home solicitation sales laws, tour operator laws, lodging certificate and seller of travel laws, securities laws, subscription laws, and other consumer protection laws.

We must obtain the approval of numerous governmental authorities for our sales and marketing activities.

Changes in circumstances or applicable law may necessitate the application for or modification of existing approvals.

In addition, many jurisdictions, including many jurisdictions in the U.S., require that we file detailed registration or offering statements with regulatory authorities disclosing information regarding our VOIs, such as information concerning the intervals being offered, the project, resort or program to which the intervals relate, applicable timeshare plans, evidence of title, details regarding our business, the purchaser’s rights and obligations with respect to such intervals, and a description of the manner in which we intend to offer and advertise such intervals.

Our telemarketing activities are subject to regulation and enforcement activities including the federal Telephone Consumer Protection Act and “do not call” legislation, which may increase the cost of telemarketing activities and expose us to enforcement actions if we do not comply.

We mitigate this risk by using permission-based marketing in some instances and have implemented procedures to comply with federal and state “do not call” regulations, including subscription to federal and certain state “do not call” registries and maintenance of an internal “do not call” list.

Similarly, state and federal regulations may place limitations on our ability to engage our consumers in electronic mail marketing campaigns, including requirements applicable to the transmission of email messages with the primary purpose of advertising or promoting a commercial product or service.

We have adopted email messaging practices responsive to the requirements of such regulations.

In addition, many jurisdictions, including many in the U.S., require that we file detailed registration or offering statements with regulatory authorities disclosing information regarding our VOIs, such as information concerning the intervals being offered, the project, resort or program to which the intervals relate, applicable timeshare plans, evidence of title, details regarding our business, the purchaser’s rights and obligations with respect to such intervals, and a description of the manner in which we intend to offer and advertise such intervals.

When we sell VOIs, local law grants the purchaser of a VOI the right to cancel a purchase contract during a specified rescission period following the later of the date the contract was signed or the date the purchaser received the last of the documents required to be provided by us.

In recent years, regulators in many jurisdictions have increased regulations and enforcement actions related to telemarketing operations, including requiring adherence to the federal Telephone Consumer Protection Act and “do not call” legislation.

These measures have significantly increased the costs associated with telemarketing, in particular with respect to telemarketing to mobile numbers.

While we continue to be subject to telemarketing risks and potential liability, we believe that our exposure to adverse effects from telemarketing legislation and enforcement is mitigated in some instances by the use of permission-based marketing in which we obtain permission to contact prospective purchasers in the future.

We have also implemented procedures to comply with federal and state “do not call” regulations including subscribing to the federal do not call registry and certain state “do not call” registries as well as maintaining an internal “do not call” list.

Purchaser Financing Regulation

Our purchaser financing activities are subject to a number of laws and regulations including those of applicable supervisory agencies such as, in the U.S., the Consumer Financial Protection Bureau, the FTC, and the Financial Crimes Enforcement Network.

These laws and regulations, some of which contain exceptions applicable to the timeshare industry, may include, among others, the Real Estate Settlement Procedures Act and Regulation X, the Truth In Lending Act and Regulation Z, the Federal Trade Commission Act, the Equal Credit Opportunity Act and Regulation B, the Fair Credit Reporting Act, the Fair Housing Act and implementing regulations, the Fair Debt Collection Practices Act, the Electronic Funds Transfer Act and Regulation E, unfair, deceptive or abusive acts or practices regulations and the Credit Practices rules, the USA PATRIOT Act, the Right to Financial Privacy Act, the Gramm-Leach-Bliley Act, the Servicemembers Civil Relief Act, and the Bank Secrecy Act.

Our purchaser financing activities are also subject to the laws and regulations of other jurisdictions, including, among others, laws and regulations related to consumer loans, retail installment contracts, mortgage lending, fair debt collection and

credit reporting practices, consumer debt collection practices, mortgage disclosure, lender or mortgage loan originator licensing and registration and anti-money laundering.

debt collection and credit reporting practices, consumer debt collection practices, mortgage disclosure, lender or mortgage loan originator licensing and registration and anti-money laundering.

Property Management Regulation

3 unchanged sentences

Employee Profile

Aligned with our mission to put the world on vacation, we are committed to responsible tourism and the best interests of people and places around the world.

We recognize our employees as associates who bring our mission to life through their service to the world’s leading membership and leisure travel company.

We recognize our employees as associates who bring our mission to put the world on vacation to life through their service to the world’s leading membership and leisure travel company.

Oversight and Management

Our Human Resources organization is tasked with managing employment-related matters, including recruiting and hiring, onboarding, compensation planning, performance management, and professional development.

Our human resources organization manages employment-related matters, including recruiting and hiring, onboarding, compensation planning, performance management, and professional development.

Our Board of Directors (“Board”) and its committees also provide oversight on certain human capital matters, including diversity and inclusion initiatives.

Our Corporate Governance Committee periodically reviews matters of corporate social responsibility and sustainability performance, including potential long and short term trends and impacts of environmental, social, and governance issues that touch on human capital matters.

Our Compensation Committee is responsible for periodically reviewing our human capital programs, policies and procedures (except to the extent within the purview of the Corporate Governance Committee), including management succession planning, and development.

The Compensation Committee is also responsible for periodically reviewing incentives and risks relating to our compensation programs and arrangements.

Our Corporate Governance Committee periodically reviews matters of corporate social responsibility and sustainability performance, including potential trends and impacts of environmental, social, and governance issues that affect human capital matters.

Our Compensation Committee is responsible for periodically reviewing certain of our human capital programs, policies and procedures, including management succession planning and development.

The Compensation Committee is also responsible for periodically reviewing incentives and risks related to our compensation programs.

Furthermore, our Audit Committee discusses compliance risks related to human capital matters and periodically reviews and updates our Code of Business Conduct and Ethics to promote ethical behavior by all of our associates.

As the unprecedented events of 2020 suspended global travel, we recalibrated operations and drove agile, sustained connectivity to our worldwide team of associates.

As the unprecedented events of 2020 suspended global travel, we recalibrated operations and drove agile, sustained connectivity to our worldwide team of associates, many of whom began to work remotely.

We executed a workforce transformation aligned with the closure and reduction of operations around the world.

Efficiencies in staffing were achieved through the layoff or furlough of 9,000 associates in March 2020.

Benefits were provided to associates for the duration of their furlough.

As of December 31, 2020, 4,800 of our furloughed associates have returned to work and we have rehired 300 associates who were previously laid-off.

Staffing related cost savings were achieved through a significant reduction in our workforce and the furlough of thousands of associates during 2020.

Benefits were provided to associates for the duration of their furlough and severance was provided to associates that were separated from Travel + Leisure Co.

As of December 31, 2021, we have reopened all of the resorts and sales offices in North America that we expect to reopen.

The remaining closed resorts and sales offices that we intend to reopen are located in the South Pacific and are expected to reopen in 2022, contingent upon the lifting of government imposed travel restrictions.

As a result of these reopenings the vast majority of our furloughed employees have returned to work.

As of December 31, 2021, our global team was comprised of more than 16,800 associates, more than 3,500 of whom work outside the U.S.;

14,100 associates support Vacation Ownership, 2,600 associates support Travel and Membership, and 100 associates comprise our corporate group.

Nearly one percent of our associates are subject to collective bargaining agreements governing their employment with our company.

Less than 1% of our associates are subject to collective bargaining agreements governing their employment with our company.

Employee Development

9 unchanged sentences

• Programs focused on career progression include:

formal talent reviews, succession planning, high-potential associate development programs, executive coaching, leader onboarding plans, new leader orientation, new leader transition training, and tuition and certification reimbursement.

formal talent reviews, succession planning, high-potential associate development programs, executive coaching, leader onboarding plans, new leader orientation and transition training, and tuition and certification reimbursement.

Inclusion and Diversity

2 unchanged sentences

• Our inclusive talent acquisition strategy focuses on developing a diverse pipeline of candidates that includes applicants from a variety of backgrounds, cultures, and experiences.

This includes women, diverse ethnicities, veterans, LGBTQ+, those with disabilities, generational diversity, and more.

This includes women, diverse ethnicities, veterans, LGBTQIA+, those with disabilities, generational diversity, and more.

• Our Global Inclusion and Diversity Council (“GIDC”) is comprised of an associate-led global team of diverse senior and executive leaders.

The mission of the GIDC is to foster, cultivate, and design actions to strengthen our culture and global communities, through inclusion, equitable opportunities, and social justice.

• We host voluntary, associate-led Diversity Resource Groups for our Black/African American, Hispanic/LatinX, LGBTQ+, Veteran, and Women associates.

• We host voluntary, associate-led diversity resource groups for our Asian/Pacific Islander, Black/African American, Hispanic/Latinx, LGBTQIA+, Veteran, and Women associates.

Diversity resource groups foster affiliation with colleagues across the business, and are designed to enable the personal growth, professional development, and retention of diverse talent.

1 unchanged sentence

Our partnerships with inclusion and diversity organizations at national and regional levels provide a platform for our associates to develop leadership skills and gain inclusion and diversity education, while executives are given the opportunity to showcase thought leadership at sponsored programs and events.

• Our roadmap to drive progress in Inclusion and Diversity is guided by our goals of continuing to enhance a diverse talent pipeline to increase women and diverse representation at the Director and above level, continued focus on diverse hires at all levels, and maintaining and growing our business relationships with companies that have diverse ownership.

• Our roadmap to drive progress in inclusion and diversity is guided by our goals of continuing to enhance a diverse talent pipeline to increase diverse representation at the director and above level, continued focus on diverse hires at all levels, and maintaining and growing our business relationships with companies that have diverse ownership.

We remain committed to “Listen, Learn, and Act” to sustain engagement and responsiveness.

Travel + Leisure Co.

President and CEO Michael Brown signed the CEO Diversity Action Pledge in partnership with the CEO Action for Diversity & Inclusion, joining more than 1,600 global organizations who have pledged to act on supporting a more inclusive workplace for employees, communities, and society at large.

Also in 2020, Brown was among 75 Central Florida leaders to sign the first-ever Orlando Economic Partnership Regional Corporate Pledge, committing to act for racial diversity, equity, and inclusion.

President and CEO Michael Brown signed the CEO Diversity Action Pledge in partnership with CEO Action for Diversity & Inclusion, joining more than 2,000 global organizations who have pledged to act on supporting a more inclusive workplace for employees, communities, and society at large.

Also Michael Brown was among 75 Central Florida leaders to sign the first-ever Orlando Economic Partnership Regional Corporate Pledge in 2020, committing to improve regional diversity, equity, and inclusion outcomes.

In an effort to improve employee diversity at the director-and-above level, we have implemented an approach where at least 50% of the candidate slate for any open employee position will be gender and/or ethnically diverse to the greatest extent practicable.

During 2021, we improved diversity at the director-and-above level by 8%.

During 2021, we had 6,102 active hires and our turnover rate was 62%, which is below the annual average for the industry for the proceeding five-year period per the U.S.

Bureau of Labor Statistics.

As of December 31, 2021, 53% of our global associates were women, 44% were men, and 3% were not declared.

Also at December 31, 2021, 53% of our global leaders with direct reports were men and 47% were women.

The following table provides the global gender distribution by level:

Gender Below Director Director and above (a)

Female 54% 39%

Undeclared 3% —%

(a) Includes our executive officers which are 78% male and 22% female.

Our ethnic representation in the U.S as of December 31, 2021 was:

• 23% Hispanic/Latinx

• 13% Black/African American

• 3% Two or more races

• 2% Native Hawaiian/Other Pacific Islander

• 1% Native American/American Indian

• 1% Undeclared

The following table provides the U.S.

ethnic diversity distribution by level:

Below Director Director and above (a)

White 47% 77%

Diverse 51% 22%

Undeclared 2% 1%

(a) Includes our executive officers which are 89% white and 11% diverse.

In addition to employee diversity, we have diverse representation on our Board, with four of our nine board members being gender and/or ethnically diverse.

Competitive Pay/Benefits

We offer a comprehensive total rewards program designed to attract and retain top talent to fuel our business success and to reward performance.

We offer a comprehensive total rewards program designed to attract and retain top talent, fuel our business objectives, and reward performance.

Our total rewards package reflects our commitment to our associates and includes competitive pay, healthcare benefits, retirement savings plans, paid time off including parental leave, and other mental health and well-being support.

Approximately 98% of our associates are eligible to participate in a retirement plan sponsored by the Company or a mandatory pension plan in their country of residence, subject to plan terms.

Approximately 97% of our associates are eligible to participate in a company sponsored retirement plan or a mandatory pension plan in their country of residence, subject to plan terms.

We also have an Employee Stock Purchase Plan with a 10 % discount from the fair market value at the grant date available to approximately 89% of our associates.

1 unchanged sentence

We believe in performance-based variable compensation programs that support a high performance environment.

Below officer level all of our managers participate in an annual incentive plan that most closely aligns with their role.

All of our managers participate in an annual incentive plan that most closely aligns with their role.

Our sales and marketing associates at all levels across our business lines participate in variable compensation plans aligned to their role.

Over 50% of all our global associates participate in a variable pay incentive pay program.

Approximately 50% of our associates participate in a variable pay incentive pay program.

Health & Safety

1 unchanged sentence

In response to the global pandemic, we created a COVID-19-specific plan for the safety and well-being of our associates, guests, and customers.

This plan mirrored the direction from the Center for Disease Control and Prevention guidelines for the United States and other equivalent government agencies in the regions where we operate globally.

Our response to the COVID-19 pandemic outlined our commitment to the health and safety of our associates.

Our global strategy is aligned by our We’ll Be Ready return to work plan, a comprehensive resource outlining the protocols and actions we take to protect our associates including:

• Transitioning associates to work from home, wherever possible

• Mandatory onsite temperature checks and health screening

• Requiring the use of masks onsite

This plan mirrored the direction from the Center for Disease Control (“CDC”) and Prevention guidelines for the U.S.

and other equivalent government agencies in the regions where we operate globally.

As part of our response, many of our employees worked remotely.

In response to many of our employees beginning to return to the office, we have adopted a global “We’ll Be Ready” return to work plan.

This plan is a comprehensive and evolving resource outlining the protocols and actions we have taken to protect our associates including:

• Transitioning associates to work from home, or work a hybrid work schedule, wherever possible.

• Mandatory onsite temperature checks and health screenings at select locations.

• Requiring the use of masks onsite for unvaccinated associates and as required by local ordinance.

• Promotion of onsite social distancing.

1 unchanged sentence

• Immediate contact tracing response.

• Enhanced onsite cleaning protocols in alignment with CDC, WHO, and OSHA protocols

• Enhanced onsite cleaning protocols in alignment with CDC, World Health Organization (“WHO”), and Occupational Safety and Health Administration (“OSHA”) protocols.

• Enhanced safety and health training specific to COVID-19.

• Vaccine education and incentive initiatives.

• Time off for associates who choose to be vaccinated.

• Required COVID-19 symptom awareness attestation.

• Certified “We’ll Be Ready” health and safety champions at all resorts and sale sites.

SOCIAL RESPONSIBILITY

We are committed to delivering shareholder and stakeholder value through our Social Responsibility program Full Circle, which remains an integral part of our company culture and global business operations.

We are committed to delivering stakeholder value through our Social Responsibility program, Full Circle, which remains an integral part of our company culture and global business operations.

We strive to cultivate an inclusive environment, in which our associates, customers, suppliers, and communities feel appreciated, respected, and valued.

In 2020, we continued to strengthen our impact across four core pillars of Social Responsibility:

Environmental Sustainability, Inclusion & Diversity, Philanthropy, and Ethics & Human Rights.

We are committed to sustainable business practices with a focus on social responsibility.

Our 2025 environmental goals are to reduce carbon emissions by 40% and water consumption by 25% at our owned, managed, and leased assets (based on square foot intensity) compared to our 2010 baseline.

As of December 31, 2020, we had reduced carbon emissions intensity by 29% and already reduced our water usage intensity by greater than 25% as compared to our 2010 baseline, while increasing our overall portfolio square footage by 16%.

Progress towards our goals is measured through our environmental management system, the WYND Green Toolbox.

Our goals will be achieved through innovative programs and the implementation of efficiency projects aimed at responsible tourism.

Our 2025 environmental goals are to reduce carbon emissions 40% and water consumption 35% at our owned, managed, and leased assets (based on square foot intensity) compared to our 2010 baseline.

We have also joined the U.S.

Department of Energy’s Better Buildings Challenge with a goal to reduce energy usage intensity 20% within U.S.

operations by 2024.

Compared to our 2010 baseline, we have reduced carbon emissions intensity 29% and exceeded our original water withdrawal goal of 25%, while increasing our overall portfolio square footage by 16%, which includes our managed resorts, corporate offices, and leased locations, including our sales and administrative offices and data centers.

During 2021, we set a new goal to reduce our water withdrawal 35% by 2025.

We have also set a goal to plant two million trees by 2025.

As of December 31, 2021, we have planted more than 1.7 million trees.

Part of our innovative approach to carbon sequestration measures is addressed through annual reforestation projects, protection of existing forests, and the sourcing of carbon neutral coffee.

Our ongoing commitment to optimize solar resources includes the implementation of 17 onsite solar projects to-date.

Our ongoing commitment to reduce carbon emissions includes the implementation of an offsite solar project and 17 onsite solar projects to-date.

With a focus on improving the lives of children and families through vacations, we support charitable organizations with a similar focus and mission.

2 unchanged sentences

Additionally, through contributions to Step Up for Students, we support providing low-income families in Florida the opportunity to choose the best education for their children.

Most recently, we established the Travel + Leisure Charitable Foundation.

This foundation will embrace a diverse and inclusive community through a variety of programs, including leadership training, mentoring opportunities, and educational support.

Since its formation, the Travel + Leisure Charitable Foundation has partnered with the School Board of Orange County, Florida, to create the Travel + Leisure Eatonville scholarship program, which strives to promote educational excellence within the Eatonville community, the oldest African-American-incorporated municipality in the U.S., by providing scholarships to eligible students.

We are committed to being an employer and neighbor of choice in the communities where we have a presence.

Our commitment is recognized through prestigious honors including Newsweek’s list of America’s Most Responsible Companies, the National LGBT Chamber of Commerce’s Best-of-the-Best, the National Veteran-Owned Business Association’s Top 2021 Best Corporations for Veteran’s Business Enterprises, Forbes’ America’s Best Large Employers, and the Human Rights Campaign Corporate Equality Index, among others.

We remain committed to the highest standards of ethics, integrity, and responsible business practices across our global operations.

1 unchanged sentence

health and safety;

conflicts of interest;

avoiding and reporting conflicts of interest;

protecting our information;

1 unchanged sentence

and financial and reporting integrity.

We encourage the reporting of any concerns without fear of retaliation through channels including our 24-hour Wyntegrity internal reporting hotline.

Aligned with our stand against human trafficking, and in partnership with ECPAT International, we are the first vacation ownership company to sign the Tourism Child Protection Code of Conduct, and to enforce required training and education for associates globally in order to protect children from exploitation.

For additional information on our social responsibility activities and initiative visit our website at investor.travelandleisureco.com/governance/Social-Responsibility.

We encourage the reporting of any concerns without fear of retaliation through channels including our 24-hour integrity internal reporting hotline.

Aligned with our stand against human trafficking, and in partnership with ECPAT International, we were the first vacation ownership company to sign the Tourism Child Protection Code of Conduct and to enforce required training and education for associates globally in order to protect children from exploitation.

Visit our website at investor.travelandleisureco.com/esg for additional information on our social responsibility activities and initiatives.

ENVIRONMENTAL COMPLIANCE

Our compliance with federal, state and local laws and regulations relating to environmental protection and discharge of hazardous materials has not had a material impact on our capital expenditures, earnings or competitive position, and we do not anticipate any material impact from such compliance in the future.

CLIMATE CHANGE

There has been public discussion that climate change is associated with extreme weather conditions and other natural disasters, such as increased frequency and severity of storms and floods, coastal erosion and flooding due to higher sea levels, increased

temperatures, and increased forest fires.

We manage properties exposed to areas which are susceptible to adverse effects resulting from these conditions and disasters.

Based upon insurable property values as of December 31, 2021, approximately 35% of our managed properties are located in Tier I windstorm exposure areas, approximately 20% are located in areas with a high level of flood risk;

and approximately 20% are located in high-risk wildfire-prone states.

It is possible that the weather conditions and other natural disasters associated with climate change could increase in frequency and/or severity in the future which could have a material adverse effect on our managed property portfolio, operating costs, and demand for our products and/or services.

KEY AGREEMENTS RELATED TO THE SPIN-OFF

This section summarizes the material agreements between Travel + Leisure and Wyndham Hotels that govern the ongoing relationships between the two companies after the Spin-off.

This section summarizes the material agreements between Travel + Leisure Co.

and Wyndham Hotels that govern the ongoing relationships between the two companies after the Spin-off.

Additional or modified agreements, arrangements, and transactions, which would be negotiated at arm’s length, may be entered into in the future.

These summaries are qualified in their entirety by reference to the full text of the applicable agreements, which are incorporated by reference herein.

As of May 31, 2018, when the Spin-off was completed, Travel + Leisure and Wyndham Hotels operate independently, and neither company has any ownership interest in the other.

As of May 31, 2018, when the Spin-off was completed, Travel + Leisure Co.

and Wyndham Hotels operated independently, and neither company has any ownership interest in the other.

Before the Spin-off, we entered into a Separation and Distribution Agreement and several other agreements with Wyndham Hotels related to the Spin-off.

1 unchanged sentence

The following is a summary of the terms of the material agreements we entered into with Wyndham Hotels.

The following summaries do not purport to be complete and are qualified in their entirety by reference to the full text of each

agreement, which is incorporated by reference into this Annual Report on Form 10-K included in Part IV, Item 15 as Exhibits 2.5, 10.53, 10.54, 10.55, and 10.56.

The following summaries do not purport to be complete and are qualified in their entirety by reference to the full text of each agreement, which is incorporated by reference into this Annual Report on Form 10-K included in Part IV, Item 15 as Exhibits 2.5, 10.57, 10.58, 10.59, and 10.60.

Separation and Distribution Agreement

We entered into a Separation and Distribution Agreement with Wyndham Hotels regarding the principal actions taken or to be taken in connection with the Spin-off.

The Separation and Distribution Agreement provides for the allocation of assets and liabilities between Travel + Leisure and Wyndham Hotels and establishes certain rights and obligations between the parties following the Distribution.

The Separation and Distribution Agreement provided for the allocation of assets and liabilities between Travel + Leisure Co.

and Wyndham Hotels and established certain rights and obligations between the parties following the Distribution.

Transfer of Assets and Assumption of Liabilities.

The Separation and Distribution Agreement provides for those transfers of assets and assumptions of liabilities that are necessary in connection with the Spin-off so that Travel + Leisure and Wyndham Hotels allocated the assets necessary to operate its respective business, and retains or assumes the liabilities allocated to it in accordance with the separation plan.

The Separation and Distribution Agreement also provides for the settlement or extinguishment of certain liabilities and other obligations among Travel + Leisure and Wyndham Hotels.

In particular, the Separation and Distribution Agreement provides that, subject to certain terms and conditions:

The Separation and Distribution Agreement provided for those transfers of assets and assumptions of liabilities that were necessary in connection with the Spin-off so that Travel + Leisure Co.

and Wyndham Hotels allocated the assets necessary to operate their respective businesses, and retain or assume the liabilities allocated to them in accordance with the separation plan.

The Separation and Distribution Agreement also provided for the settlement or extinguishment of certain liabilities and other obligations among Travel + Leisure Co.

and Wyndham Hotels.

In particular, the Separation and Distribution Agreement provided that, subject to certain terms and conditions:

• The assets that have been retained by or transferred to Wyndham Hotels (“SpinCo assets”) include, but are not limited to:

8 unchanged sentences

• any and all liabilities (whether accrued, contingent or otherwise) reflected on the audited combined balance sheet of the Wyndham Hotels businesses.

• Wyndham Hotels assumes one-third and Travel + Leisure assumes two-thirds of certain contingent and other corporate liabilities of Travel + Leisure and Wyndham Hotels (“shared contingent liabilities”) in each case incurred prior to the Distribution, including our liabilities related to, arising out of or resulting from (i) certain terminated or divested businesses, (ii) certain general corporate matters of Travel + Leisure, and (iii) any actions with respect to the separation plan or the Distribution made or brought by any third party;

• Wyndham Hotels is entitled to receive one-third and Travel + Leisure is entitled to receive two-thirds of the proceeds (or, in certain cases, a portion thereof) from certain contingent and other corporate assets of Travel + Leisure and Wyndham Hotels (“shared contingent assets”) arising or accrued prior to the Distribution, including our assets related to, arising from or involving (i) certain terminated or divested businesses, and (ii) certain general corporate matters of Travel + Leisure;

• In connection with the sale of our European vacation rentals business, Wyndham Hotels assumed one-third and Travel + Leisure assumed two-thirds of certain shared contingent liabilities and certain shared contingent assets.

Such shared contingent assets and shared contingent liabilities include:

(i) any amounts paid or received by Travel + Leisure in respect of any indemnification claims made in connection with such sale, (ii) any losses actually incurred by Travel + Leisure or Wyndham Hotels in connection with its provision of post-closing credit support to the European vacation rentals business, in the form of an unsecured guarantee, letter of credit or otherwise, in a fixed amount to be

determined, to ensure that the European vacation rentals business meets the requirements of certain service providers and regulatory authorities, and (iii) any tax assets or liabilities related to such sale;

• Except as otherwise provided in the Separation and Distribution Agreement or any ancillary agreement, the corporate costs and expenses relating to the Spin-off will be paid by the party with whom such costs were incurred, from a separate account maintained by each of Wyndham Hotels and Travel + Leisure and established prior to completion of the Spin-off on terms agreed upon by Wyndham Hotels and Travel + Leisure and, to the extent the funds in such separate account are not sufficient to satisfy such costs and expenses, be treated as shared contingent liabilities (as described above);

• All of our assets and liabilities (whether accrued, contingent or otherwise) other than the SpinCo assets and SpinCo liabilities, subject to certain exceptions (including the shared contingent assets and shared contingent liabilities), have been retained by or transferred to Travel + Leisure, except as set forth in the Separation and Distribution Agreement or one of the other agreements described below.

• Wyndham Hotels assumed one-third and Travel + Leisure Co.

assumed two-thirds of certain contingent and other corporate liabilities of Travel + Leisure Co.

and Wyndham Hotels (“shared contingent liabilities”) in each case incurred prior to the Distribution, including our liabilities related to, arising out of or resulting from (i) certain terminated or divested businesses, (ii) certain general corporate matters of Travel + Leisure Co., and (iii) any actions with respect to the separation plan or the Distribution made or brought by any third party.

• Wyndham Hotels is entitled to receive one-third and Travel + Leisure Co.

is entitled to receive two-thirds of the proceeds (or, in certain cases, a portion thereof) from certain contingent and other corporate assets of Travel + Leisure Co.

and Wyndham Hotels (“shared contingent assets”) arising or accrued prior to the Distribution, including our assets related to, arising from or involving (i) certain terminated or divested businesses, and (ii) certain general corporate matters of Travel + Leisure Co.

• In connection with the sale of our European vacation rentals business, Wyndham Hotels assumed one-third and Travel + Leisure Co.

assumed two-thirds of certain shared contingent liabilities and certain shared contingent assets.

and established prior to completion of the Spin-off on terms agreed upon by Wyndham Hotels and Travel + Leisure Co.

and, to the extent the funds in such separate account are not sufficient to satisfy such costs and expenses, be treated as shared contingent liabilities (as described above).

• All of our assets and liabilities (whether accrued, contingent or otherwise) other than the SpinCo assets and SpinCo liabilities, subject to certain exceptions (including the shared contingent assets and shared contingent liabilities), have been retained by or transferred to Travel + Leisure Co., except as set forth in the Separation and Distribution Agreement or one of the other agreements described below.

Release of Claims and Indemnification .

Travel + Leisure and Wyndham Hotels have agreed to broad releases pursuant to which each releases the other and certain related persons specified in the Separation and Distribution Agreement from any claims against any of them that arise out of or relate to events, circumstances or actions occurring or failing to occur or alleged to occur or to have failed to occur or any conditions existing or alleged to exist at or prior to the time of the Distribution.

Travel + Leisure Co.

and Wyndham Hotels have agreed to broad releases pursuant to which each releases the other and certain related persons specified in the Separation and Distribution Agreement from any claims against any of them that arise out of or relate to events, circumstances or actions occurring or failing to occur or alleged to occur or to have failed to occur or any conditions existing or alleged to exist at or prior to the time of the Distribution.

These releases are subject to certain exceptions set forth in the Separation and Distribution Agreement and the ancillary agreements.

The Separation and Distribution Agreement provides for cross-indemnities that, except as otherwise provided in the Separation and Distribution Agreement, are principally designed to place financial responsibility for the obligations and liabilities of Wyndham Hotels’ business with Wyndham Hotels, and financial responsibility for the obligations and liabilities of Travel + Leisure’s business with Travel + Leisure.

Specifically, each party will, and will cause its subsidiaries to, indemnify, defend and hold harmless the other party, its affiliates and subsidiaries and each of its and their respective officers, directors, employees and agents for any losses arising out of, by reason of or otherwise in connection with:

5 unchanged sentences

Employee Matters Agreement

We are party to an Employee Matters Agreement with Wyndham Hotels that governs the respective rights, responsibilities and obligations of Wyndham Hotels and Travel + Leisure following the Spin-off.

The Employee Matters Agreement addresses the allocation of employees between Wyndham Hotels and us, defined benefit pension plans, qualified defined contribution plans, non-qualified deferred compensation plans, employee health and welfare benefit plans, incentive plans, equity-based awards, collective bargaining agreements and other employment, compensation and benefits-related matters.

Following the Spin-off, Wyndham Hotels employees no longer participate in Travel + Leisure’s plans or programs (provided that they did continue to participate in employee health and welfare benefit plans for a limited period of time following the Spin-off in conjunction with the Transition Services Agreement described below, which continued participation ended December 31, 2020), and Wyndham Hotels has established plans or programs for their employees as described in the Employee Matters Agreement.

We are party to an Employee Matters Agreement with Wyndham Hotels that governs the respective rights, responsibilities and obligations of Wyndham Hotels and Travel + Leisure Co.

following the Spin-off.

The Employee Matters Agreement addresses the allocation of employees between Wyndham Hotels and Travel + Leisure Co.

as well as other employment, compensation

and benefits-related matters.

As of January 1, 2021, Wyndham Hotels’ employees no longer participate in Travel + Leisure Co.’s plans or programs, and Wyndham Hotels has established plans or programs for their employees as described in the Employee Matters Agreement.

Tax Matters Agreement

We have a Tax Matters Agreement with Wyndham Hotels that governs the respective rights, responsibilities and obligations of Wyndham Hotels and us following the Spin-off with respect to tax liabilities and benefits, tax attributes, tax contests and other tax sharing regarding U.S.

We have a Tax Matters Agreement with Wyndham Hotels that governs the respective rights, responsibilities and obligations of Wyndham Hotels and Travel + Leisure Co.

following the Spin-off with respect to tax liabilities and benefits, tax attributes, tax contests and other tax sharing regarding U.S.

federal, state, local and foreign income taxes, other tax matters and related tax returns.

As a former subsidiary of Travel + Leisure, Wyndham Hotels has joint and several liability with us to the U.S.

As a former subsidiary of Travel + Leisure Co., Wyndham Hotels has joint and several liability with us to the U.S.

Internal Revenue Service (“IRS”) for the combined U.S.

federal income taxes of the Travel + Leisure consolidated group relating to the taxable periods in which Wyndham Hotels was part of that group.

In general, the Tax Matters Agreement specifies that Wyndham Hotels will

bear one-third, and Travel + Leisure two-thirds, of this tax liability, and Wyndham Hotels has agreed to indemnify us against any amounts for which we are not responsible including subject to the next sentence.

federal income taxes of the Travel + Leisure Co.

consolidated group relating to the taxable periods in which Wyndham Hotels was part of that group.

In general, the Tax Matters Agreement specifies that Wyndham Hotels will bear one-third, and Travel + Leisure Co.

two-thirds, of this tax liability, and Wyndham Hotels has agreed to indemnify us against any amounts for which we are not responsible including subject to the next sentence.

The Tax Matters Agreement also provides special rules for allocating tax liabilities in the event that the Spin-off is not tax-free.

2 unchanged sentences

Although valid as between the parties, the Tax Matters Agreement will not be binding on the IRS.

Transition Services Agreement

We entered into a Transition Services Agreement with Wyndham Hotels under which Wyndham Hotels provided us with certain services, and we provided Wyndham Hotels with certain services, for a limited time to help ensure an orderly transition following the distribution.

These services included certain finance, information technology, human resources, payroll, tax, and other services.

The transition services have ended as of December 31, 2020.

License, Development and Noncompetition Agreement

In connection with the Spin-off, we entered into a license, development and noncompetition agreement with Wyndham Hotels, which, among other things, granted to Travel + Leisure the right to use the “Wyndham” trademark, “The Registry Collection” trademark and certain other trademarks and intellectual property in our business.

In connection with the Spin-off, we entered into a license, development and noncompetition agreement with Wyndham Hotels, which, among other things, granted to Travel + Leisure Co.

the right to use the “Wyndham” trademark, “The Registry Collection” trademark and certain other trademarks and intellectual property in our business.

This right is generally limited to use in connection with our vacation ownership and vacation exchange businesses, with certain limited exceptions.

3 unchanged sentences

These non-compete obligations restrict us and Wyndham Hotels from competing with the other party’s business (subject to customary carve-outs) for the first 25 years of the term of the License, Development and Noncompetition Agreement, and we may extend the term of these non-compete obligations for an additional five year term if we achieve a certain sales target in the last full calendar year of the initial 25-year term.

If either party acquires a business that competes with the other party’s businesses, Wyndham Hotels or us, must offer the other party the right to acquire such competing business upon and subject to the terms and conditions set forth in the license, development and noncompetition agreement.

Additionally, if either party engages in a project that has a component that competes with the other party’s businesses, Wyndham Hotels or us, must use commercially reasonable efforts to include the other party in such project, subject to the terms and conditions set forth in the license, development and noncompetition agreement.

If either party acquires a business that competes with the other party’s businesses, Wyndham Hotels or Travel + Leisure Co., must offer the other party the right to acquire such competing business upon and subject to the terms and conditions set forth in the License, Development and Noncompetition Agreement.

Additionally, if either party engages in a project that has a component that competes with the other party’s businesses, Wyndham Hotels or Travel + Leisure Co., must use commercially reasonable efforts to include the other party in such project, subject to the terms and conditions set forth in the License, Development and Noncompetition Agreement.

In January 2021, Travel + Leisure Co.

and Wyndham Hotels entered into a letter agreement pursuant to which, among other things, Wyndham Hotels waived its right to enforce certain noncompetition covenants in the License, Development and Noncompetition Agreement.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business