Annual report pursuant to Section 13 and 15(d)

Other Expenses and Charges

v3.22.4
Other Expenses and Charges
 12 Months Ended
Dec. 31, 2022
Discontinued Operations and Disposal Groups [Abstract]  
Other Expenses and Charges
18. OTHER EXPENSES AND CHARGES
Gain on Asset Sale, Net
In March 2022, the Company completed the sale of its Wyndham Grand Bonnet Creek Resort for gross proceeds of $121 million ($118 million, net of transaction costs) and recognized a $35 million gain, net of transaction costs, for the year ended December 31, 2022 which was attributable to the Company’s hotel management business and was reported within gain on asset sale, net on the Consolidated Statement of Income/(Loss). Additionally, the Company entered into a 20 year franchise agreement with the buyer.
In May 2022, the Company completed the sale of its Wyndham Grand Rio Mar Resort for gross proceeds of $62 million ($61 million, net of transaction costs). There was no gain or loss on the sale as the proceeds approximated adjusted net book value. Additionally, the Company entered into a 20 year franchise agreement with the buyer.
Separation-Related
The Company incurred separation-related costs associated with its spin-off from former Parent of $1 million, $3 million and $2 million during 2022, 2021 and 2020, respectively. During 2022 and 2021 these costs primarily consisted of legal and tax-related costs. During 2020 these costs primarily consisted of severance and other employee-related costs.
Impairments, Net
During the fourth quarter of 2021, the Company’s Board approved a plan to sell its two owned hotels. As a result of the Board approval, the Company evaluated the recoverability of its owned hotels long-lived assets and in the fourth quarter of 2021, the Company recorded a $6 million impairment charge which was reported within impairments, net on the Consolidated Statement of Income/(Loss). For more information, see Note 7 - Assets and Liabilities Held for Sale.
As a result of COVID-19 and the significant negative impact it has had on travel demand during 2020, the Company reviewed its intangible assets for potential impairment and determined that the carrying value of certain intangible assets were in excess of their fair values. Accordingly, the Company recorded impairment charges of $205 million, in 2020, primarily related to certain trademarks and goodwill associated with its owned hotel reporting unit. See Note 9 - Intangible Assets for more information. Additionally, in 2020, the Company incurred a $4 million non-cash impairment charge for the write-off of a receivable as a result of the Company’s notice of termination of an unprofitable management agreement. In 2020, the Company also received $3 million of cash related to a previously impaired asset. These charges were all reported within impairments, net on the Consolidated Statement of Income/(Loss).
Restructuring
The Company incurred $34 million of charges during 2020, related to four restructuring initiatives implemented in response to COVID-19. Such plans resulted in a reduction of 846 employees during 2020. In addition, during 2019, the Company had implemented restructuring initiatives, primarily focused on enhancing its organizational efficiency and rationalizing its operations, as discussed below.
Restructuring charges by segment for the year ended December 31, 2020 were as follows:
Year Ended December 31, 2020
Hotel Franchising $ 15 
Hotel Management 3 
Corporate and Other 16 
Total $ 34 
Below is the activity for the year ended December 31, 2021 relating to all four of the Company’s restructuring plans implemented in 2020:
2021 Activity
Liability as of December 31, 2020 Cash Payments Liability as of December 31, 2021
Personnel-related $ 7  $ (7) $ — 
Facility-related 3  (3) — 
Total accrued restructuring $ 10  $ (10) $ — 
The following table presents activity for the year ended December 31, 2020 relating to restructuring activities by plan:
2020 Activity
Liability as of December 31, 2019 Costs Recognized Cash Payments
Other (a)
Liability as of December 31, 2020
2019 Plan
Personnel-related $ 8  $ —  $ (7) $ (1) $ — 
2020 Plans
Personnel-related —  28  (20) (1) 7 
Facility-related —  5  (2) —  3 
Other —  1  (1) —  — 
Total 2020 Plans —  34  (23) (1) 10 
Total accrued restructuring $ 8  $ 34  $ (30) $ (2) $ 10 
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(a)Represents non-cash payments in Company stock.
Transaction-Related, Net
The Company incurred $12 million of transaction-related expenses during the year ended December 31, 2020, which were primarily related to integration activities for the acquisition of La Quinta.