CHOICE HOTELS INTERNATIONAL INC /DE

Previous wording

We are primarily a hotel franchisor operating in 49 states, the District of Columbia, and 51 countries and territories. As of March 31, 2026, we had 7,588 hotels with 658,348 rooms open and operating, and 830 hotels with 77,773 rooms under construction, awaiting conversion or approved for development, or committed to future franchise development on outstanding master development agreements (collectively, "pipeline") in our global system. Our brand names include Clarion®, Clarion Pointe™, Comfort Inn®, Comfort Suites®, Country Inn & Suites® by Radisson, Sleep Inn®, Quality®, Park Inn by Radisson®, Everhome Suites®, WoodSpring Suites®, MainStay Suites®, Suburban Studios™, Radisson Blu®, Park Plaza®, Cambria® Hotels, Ascend Collection®, Radisson RED®, Radisson Individuals®, Radisson®, Radisson Collection®, Radisson Inn & Suites SM, Econo Lodge®, and Rodeway Inn®.

Current wording

We are primarily a hotel franchisor operating in 49 states, the District of Columbia, and 49 countries and territories. As of June 30, 2026, we had 7,608 hotels with 661,089 rooms open and operating, and 841 hotels with 77,275 rooms under construction, awaiting conversion or approved for development, or committed to future franchise development on outstanding master development agreements (collectively, "pipeline") in our global system. Our brand names include Clarion®, Clarion Pointe®, Comfort®, Country Inn & Suites® by Radisson, Sleep Inn®, Quality®, Park Inn® by Radisson®, Everhome Suites®, WoodSpring Suites®, MainStay Suites®, Suburban Studios®, Radisson Blu®, Park Plaza®, Cambria® Hotels, Ascend Collection®, Radisson RED®, Radisson Individuals®, Radisson®, Radisson Collection®, Radisson Inn & Suites™, Econo Lodge®, and Rodeway Inn®.

Previous wording

The hotel franchising business represents the Company's primary operations. The Company's U.S. operations are conducted through direct franchising relationships, the ownership of 17 open and operating hotels, and the management of 13 hotels (inclusive of four owned hotels), while its international franchise operations are conducted through a combination of direct franchising and master franchising relationships. Master franchising relationships are governed by master franchising agreements which generally provide the master franchisee with the right to use our brands and sub-license the use of our brands in a specific geographic region, usually for a fee. As a result of our master franchise relationships and international market conditions, our revenues are primarily concentrated in the U.S. Therefore, our description of our business is primarily focused on the U.S. operations.

Current wording

The hotel franchising business represents the Company's primary operations. The Company's U.S. operations are conducted through direct franchising relationships, the ownership of 18 open and operating hotels, and the management of 13 hotels (inclusive of four owned hotels), while its international franchise operations are conducted through a combination of direct franchising and master franchising relationships. Master franchising relationships are governed by master franchising agreements which generally provide the master franchisee with the right to use our brands and sub-license the use of our brands in a specific geographic region, usually for a fee. As a result of our master franchise relationships and international market conditions, our revenues are primarily concentrated in the U.S. Therefore, our description of our business is primarily focused on the U.S. operations.

Previous wording

In addition to our hotel franchising business, we have also developed or acquired 17 open and operating hotels. We have strategically developed hotels to increase the presence of our newly introduced brands in the U.S., drive greater guest satisfaction and brand preference, and ultimately increase the number of franchise agreements awarded. When developing hotels, we seek key markets with strong growth potential that will deliver strong operating performance and improve the recognition of our brands. Our hotel development and ownership efforts currently focus on the Cambria Hotels and Everhome Suites brands. We believe our owned hotels provide us the opportunity to support and accelerate the growth of these brands. We do not anticipate owning hotels on a permanent basis and we expect to target dispositions to a franchisee encumbered with a long-term Choice franchise agreement in the future.

Current wording

In addition to our hotel franchising business, we have also developed or acquired 18 open and operating hotels. We have strategically developed hotels to increase the presence of our newly introduced brands in the U.S., drive greater guest satisfaction and brand preference, and ultimately increase the number of franchise agreements awarded. When developing hotels, we seek key markets with strong growth potential that will deliver strong operating performance and improve the recognition of our brands. Our hotel development and ownership efforts currently focus on the Cambria Hotels and Everhome Suites brands. We believe our owned hotels provide us the opportunity to support and accelerate the growth of these brands. We do not anticipate owning hotels on a permanent basis and we expect to target dispositions to a franchisee encumbered with a long-term Choice franchise agreement in the future.

Previous wording

Due to the seasonal nature of the Company’s hotel franchising and management business and the multi-year investments required to support the franchise operations, quarterly and/or annual surpluses or deficits may be generated. During the three months ended March 31, 2026 and 2025, reimbursable expenses from franchised and managed properties exceeded revenue for reimbursable costs from franchised and managed properties by $37.9 million and $20.4 million, respectively.

Current wording

Due to the seasonal nature of the Company’s hotel franchising and management business and the multi-year investments required to support the franchise operations, quarterly and/or annual surpluses or deficits may be generated. During the three months ended June 30, 2026 and 2025, reimbursable expenses from franchised and managed properties exceeded revenue for reimbursable costs from franchised and managed properties by $34.3 million and $9.0 million, respectively. During the six months ended June 30, 2026 and 2025, reimbursable expenses from franchised and managed properties exceeded revenue for reimbursable costs from franchised and managed properties by $72.2 million and $29.4 million, respectively.

Previous wording

Operating income decreased $19.9 million primarily due to a $17.5 million increase in the net reimbursable deficit from franchised and managed properties, a $3.8 million increase in selling, general and administrative expenses, and a $3.1 million increase in depreciation and amortization, all of which were partially offset by a $4.6 million increase in franchise and management fees.

Current wording

Operating income decreased $20.5 million primarily due to a $25.3 million increase in the net reimbursable deficit from franchised and managed properties, a $6.9 million increase in selling, general and administrative expenses, and a $3.4 million increase in depreciation and amortization, all of which were partially offset by a $10.5 million increase in franchise and management fees.

Previous wording

International royalty fees increased $5.2 million to $11.8 million for the three months ended March 31, 2026 from $6.6 million for the three months ended March 31, 2025. The increase in international royalty fees was primarily due to an increase in the international franchise system size by 152 hotels (from 1,248 hotels as of March 31, 2025 to 1,400 hotels as of March 31, 2026) and 18,481 rooms (from 141,986 rooms as of March 31, 2025 to 160,467 rooms as of March 31, 2026), an increase in royalty fees as a result of the acquisition of the remaining 50% equity interest in Choice Hotels Canada, and an increase in international RevPAR.

Current wording

International royalty fees increased $6.4 million to $14.2 million for the three months ended June 30, 2026 from $7.8 million for the three months ended June 30, 2025. The increase in international royalty fees was primarily due to an increase in the international franchise system size by 155 hotels (from 1,258 hotels as of June 30, 2025 to 1,413 hotels as of June 30, 2026) and 18,025 rooms (from 143,838 rooms as of June 30, 2025 to 161,863 rooms as of June 30, 2026), an increase in royalty fees as a result of the acquisition of the remaining 50% equity interest in Choice Hotels Canada, and an increase in international RevPAR.

Previous wording

Selling, general and administrative expenses increased $3.8 million primarily due to a $4.3 million increase in bad debt expense and a $1.1 million increase in expenses to operate Choice Hotels Canada during the three months ended March 31, 2026, all of which were partially offset by a $0.7 million decrease in costs related to the global ERP system implementation and decreases in other general costs to operate the franchising business.

Current wording

Selling, general and administrative expenses increased $6.9 million primarily due to a $4.5 million increase in the provision for credit losses in accounts receivable, a $1.7 million increase in non-recurring operational restructuring and executive severance expense, a $1.4 million increase in expenses to operate Choice Hotels Canada during the three months ended June 30, 2026, and increases in other general costs to operate the franchising business, all of which were partially offset by a $2.0 million decrease in operating guarantee payments for a portfolio of managed hotels which was acquired in connection with the Company's purchase of Radisson Hotels Americas, and a $1.0 million decrease in costs related to the global enterprise resource planning ("ERP") system implementation.

Previous wording

Depreciation and amortization expense increased $3.1 million primarily due to a $2.0 million increase in amortization expense for intangible assets as a result of the acquisition of the remaining 50% equity interest in Choice Hotels Canada in July 2025 and a $1.0 million increase in depreciation expense related to the opening of four owned hotels during the third and fourth quarters of 2025.

Current wording

Depreciation and amortization expense increased $3.4 million primarily due to a $2.0 million increase in amortization expense for intangible assets as a result of the acquisition of the remaining 50% equity interest in Choice Hotels Canada in July 2025 and a $1.1 million increase in depreciation expense related to the opening of five owned hotels.

Previous wording

The Company’s effective income tax rates were 33.0% and 25.5% for the three months ended March 31, 2026 and 2025, respectively. The effective income tax rate for the three months ended March 31, 2026 was higher than the U.S. federal income tax rate of 21.0% primarily due to the impact of state income taxes and tax expense related to compensation. The effective income tax rate for the three months ended March 31, 2025 was higher than the U.S. federal income tax rate of 21.0% primarily due to the impact of state income taxes.

Current wording

The Company’s effective income tax rates were 25.1% and 24.7% for the three months ended June 30, 2026 and 2025, respectively. The effective income tax rate for the three months ended June 30, 2026 was higher than the U.S. federal income tax rate of 21.0% primarily due to the impact of state income taxes and tax expense related to compensation. The effective income tax rate for the three months ended June 30, 2025 was higher than the U.S. federal income tax rate of 21.0% primarily due to the impact of state income taxes.

Previous wording

For the three months ended March 31, 2026, the Company recognized income before income taxes of $30.3 million, which is a $29.5 million decrease from the same period in the prior year. The decrease in income before income taxes was primarily due to a $19.9 million decrease in operating income, a $6.2 million increase in equity in net loss of affiliates, and a $2.7 million increase in interest expense.

Current wording

For the six months ended June 30, 2026, the Company recognized income before income taxes of $116.2 million, which is a $52.2 million decrease from the same period in the prior year. The decrease in income before income taxes was primarily due to a $40.4 million decrease in operating income, a $7.3 million increase in equity in net loss of affiliates, and a $4.2 million increase in interest expense.

Previous wording

Franchise and management fees increased $4.6 million primarily due to a $5.2 million increase in international royalty fees and a $4.5 million increase in revenues generated from programs, platforms, and services associated with the Company's franchise operations, all of which were partially offset by a $4.0 million decrease in U.S. royalty fees and a $1.5 million decrease in initial franchise fees.

Current wording

Franchise and management fees increased $15.0 million primarily due to an $11.6 million increase in international royalty fees and a $7.3 million increase in revenues generated from programs, platforms, and services associated with the Company's franchise operations, all of which were partially offset by a $2.9 million decrease in initial franchise fees and a $2.7 million decrease in U.S. royalty fees.

Previous wording

U.S. royalty fees decreased $4.0 million to $90.6 million for the three months ended March 31, 2026 from $94.6 million for the three months ended March 31, 2025. The decrease in U.S. royalty fees was primarily due to a 2.3% decrease in U.S. system-wide RevPAR as a result of a 2.1% decrease in average daily rates and a 10 basis points decrease in occupancy during the current period, which was partially offset by a system-wide 11 basis points increase in the average royalty rate from 5.11% for the three months ended March 31, 2025 to 5.22% for the three months ended March 31, 2026. The U.S. system-wide RevPAR during the three months ended March 31, 2025 includes a hurricane-related impact of 410 basis points.

Current wording

U.S. royalty fees decreased $2.7 million to $213.1 million for the six months ended June 30, 2026 from $215.8 million for the six months ended June 30, 2025. The decrease in U.S. royalty fees was primarily due to a 0.2% decrease in U.S. system-wide RevPAR as a result of a 0.5% decrease in average daily rates and a 20 basis points increase in occupancy, and a 0.3% decrease in open and operating U.S. hotel rooms, all of which were partially offset by a system-wide 11 basis points increase in the average royalty rate from 5.11% for the six months ended June 30, 2025 to 5.22% for the six months ended June 30, 2026. The U.S. system-wide RevPAR during the six months ended June 30, 2025 includes a hurricane-related impact of 212 basis points.

Previous wording

Equity in net loss of affiliates increased $6.2 million primarily due to a $5.8 million decrease in the equity earnings from our unconsolidated affiliates and a $0.9 million decrease in the equity earnings as a result of acquiring the remaining 50% equity interest in Choice Hotels Canada in July 2025.

Current wording

Equity in net loss of affiliates increased $7.3 million primarily due to a $5.4 million net decrease in the equity earnings from our unconsolidated affiliates and a $1.8 million decrease in the equity earnings as a result of acquiring the remaining 50% equity interest in Choice Hotels Canada in July 2025.

Previous wording

Interest expense increased $2.7 million primarily due to increased borrowings. Refer to the discussion in the Liquidity and Capital Resources section in MD&A for more information.

Current wording

Interest expense increased $4.2 million primarily due to increased borrowings. Refer to the discussion in the Liquidity and Capital Resources section in MD&A for more information.

Previous wording

As of March 31, 2026, the Company's primary sources of liquidity consisted of $474.0 million in cash and cash equivalents and available borrowing capacity under the senior unsecured revolving credit facility. As of March 31, 2026, the Company was in compliance with all of its financial covenants under its credit agreements and the Company expects to remain in such compliance. The Company believes that its cash on hand, available borrowing capacity under the senior unsecured revolving credit facility, cash flows from operations, and access to additional capital in the debt markets will provide sufficient liquidity to meet the expected future operating, investing, and financing needs of the business.

Current wording

As of June 30, 2026, the Company's primary sources of liquidity consisted of $475.0 million in cash and cash equivalents and available borrowing capacity under the senior unsecured revolving credit facility. As of June 30, 2026, the Company was in compliance with all of its financial covenants under its credit agreements and the Company expects to remain in such compliance. The Company believes that its cash on hand, available borrowing capacity under the senior unsecured revolving credit facility, cash flows from operations, and access to additional capital in the debt markets will provide sufficient liquidity to meet the expected future operating, investing, and financing needs of the business.

Previous wording

Our board of directors authorized a program which permits us to offer investment and guaranty support to qualified franchisees, and to acquire or develop and then resell hotels to incentivize franchise development of our brands in strategic markets. We primarily engage in these investment and guaranty support activities to encourage acceleration of the growth of our Cambria Hotels and Everhome Suites brands. With respect to these activities, the Company had approximately $642.5 million of investments in the Cambria Hotels and Everhome Suites brands reflected in the consolidated balance sheet as of March 31, 2026. The Company is generally targeting to recycle these investments within a five year period, and expects our outstanding investments to not exceed $1.2 billion at any point in time based on the current board of directors' authorization. The deployment and annual pace of future investment and guaranty support activities will depend upon market and other conditions, including among others, our franchise sales results, the environment for new construction hotel development, and the hotel lending environment. The Company expects the Cambria Hotels and Everhome Suites brands development investments to continue to decline in future periods, as both brands approach scale milestones.

Current wording

Our board of directors authorized a program which permits us to offer investment and guaranty support to qualified franchisees, and to acquire or develop and then resell hotels to incentivize franchise development of our brands in strategic markets. We primarily engage in these investment and guaranty support activities to encourage acceleration of the growth of our Cambria Hotels and Everhome Suites brands. With respect to these activities, the Company had approximately $653.6 million of investments in the Cambria Hotels and Everhome Suites brands reflected in the consolidated balance sheet as of June 30, 2026. The Company is generally targeting to recycle these investments within a five year period, and expects our outstanding investments to not exceed $1.2 billion at any point in time based on the current board of directors' authorization. The deployment and annual pace of future investment and guaranty support activities will depend upon market and other conditions, including among others, our franchise sales results, the environment for new construction hotel development, and the hotel lending environment. The Company expects the Cambria Hotels and Everhome Suites brands development investments to continue to decline in future periods, as both brands approach scale milestones.

Previous wording

The Company has historically generated cash flows from operating activities that are in excess of the capital needed to invest in growth opportunities and to service debt obligations. As a result, the Company maintains a share repurchase program and typically pays a quarterly dividend. As of March 31, 2026, the Company had 2.3 million shares remaining under the current share repurchase authorization. The projected 2026 annual dividend rate is $1.15 per share or approximately $52.6 million in aggregate dividend payments. Future dividends are subject to declarations by our board of directors.

Current wording

The Company has historically generated cash flows from operating activities that are in excess of the capital needed to invest in growth opportunities and to service debt obligations. As a result, the Company maintains a share repurchase program and typically pays a quarterly dividend. As of June 30, 2026, the Company had 1.8 million shares remaining under the current share repurchase authorization. The projected 2026 annual dividend rate is $1.15 per share or approximately $52.3 million in aggregate dividend payments. Future dividends are subject to declarations by our board of directors.

Previous wording

During the three months ended March 31, 2026, the net cash used in operating activities was $23.2 million. During the three months ended March 31, 2025, the net cash provided by operating activities was $20.5 million. Our operating cash flows decreased $43.6 million primarily due to the timing of working capital items, an increase in the franchise agreement acquisition cost payments, and an increase in the net reimbursable deficit from franchised and managed properties, all of which were partially offset by a decrease in deferred income taxes.

Current wording

During the six months ended June 30, 2026 and 2025, the net cash provided by operating activities was $67.4 million and $116.1 million, respectively. Our operating cash flows decreased $48.7 million primarily due to an increase in franchise agreement acquisition cost payments and an increase in the net reimbursable deficit from franchised and managed properties, all of which were partially offset by a decrease in deferred income taxes and the timing of working capital items.

Previous wording

In conjunction with brand and development programs, we strategically make certain franchise agreement acquisition cost payments to franchisees as an incentive to enter into new franchise agreements or perform-designated improvements to properties under existing franchise agreements. If the franchisee remains in the franchise system in good standing over the term specified in the incentive agreement, then the Company forgives the incentive ratably. If the franchisee exits our franchise system or is not operating their franchise in accordance with our quality or credit standards and is terminated, then the franchisee must repay the unamortized franchise agreement acquisition cost payment plus interest to the Company. During the three months ended March 31, 2026 and 2025, the Company's net franchise agreement acquisition costs were $42.8 million and $26.3 million, respectively.

Current wording

In conjunction with brand and development programs, we strategically make certain franchise agreement acquisition cost payments to franchisees as an incentive to enter into new franchise agreements or perform-designated improvements to properties under existing franchise agreements. If the franchisee remains in the franchise system in good standing over the term specified in the incentive agreement, then the Company forgives the incentive ratably. If the franchisee exits our franchise system or is not operating their franchise in accordance with our quality or credit standards and is terminated, then the franchisee must repay the unamortized franchise agreement acquisition cost payment plus interest to the Company. During the six months ended June 30, 2026 and 2025, the Company's net franchise agreement acquisition costs were $72.2 million and $41.5 million, respectively.

Previous wording

The Company’s franchise agreements require the payment of marketing and reservation fees to be used by the Company for the expenses associated with providing franchise services such as national marketing, media advertising, and central reservation systems. Additionally, the Company's management agreements include cost reimbursements, primarily related to the payroll costs at the managed hotels where the Company is the employer. These activities are reflected in revenue for reimbursable costs from franchised and managed properties and reimbursable expenses from franchised and managed properties. During the three months ended March 31, 2026 and 2025, reimbursable expenses from franchised and managed properties exceeded revenue for reimbursable costs from franchised and managed properties by $37.9 million and $20.4 million, respectively.

Current wording

The Company’s franchise agreements require the payment of marketing and reservation fees to be used by the Company for the expenses associated with providing franchise services such as national marketing, media advertising, and central reservation systems. Additionally, the Company's management agreements include cost reimbursements, primarily related to the payroll costs at the managed hotels where the Company is the employer. These activities are reflected in revenue for reimbursable costs from franchised and managed properties and reimbursable expenses from franchised and managed properties. During the six months ended June 30, 2026 and 2025, reimbursable expenses from franchised and managed properties exceeded revenue for reimbursable costs from franchised and managed properties by $72.2 million and $29.4 million, respectively.

Previous wording

The net cash used in investing activities was $6.2 million and $53.0 million for the three months ended March 31, 2026 and 2025, respectively.

Current wording

The net cash used in investing activities was $34.0 million and $95.1 million for the six months ended June 30, 2026 and 2025, respectively.

Previous wording

During the three months ended March 31, 2026 and 2025, investments in owned hotel properties totaled $16.8 million and $35.5 million, respectively. These investments related to the ongoing hotel development efforts to support the continued growth of the Cambria Hotels and Everhome Suites brands. During the three months ended March 31, 2026 and 2025, investments in other property and equipment totaled $10.1 million and $10.5 million, respectively. These investments primarily related to leasehold improvements, office equipment, and capitalized software.

Current wording

During the six months ended June 30, 2026 and 2025, investments in owned hotel properties totaled $27.3 million and $65.7 million, respectively. These investments related to the ongoing hotel development efforts to support the continued growth of the Cambria Hotels and Everhome Suites brands. During the six months ended June 30, 2026 and 2025, investments in other property and equipment totaled $17.9 million and $18.3 million, respectively. These investments primarily related to leasehold improvements, office equipment, and capitalized software.

Previous wording

The Company has equity method investments in affiliates related to the Company's program to offer equity support to qualified franchisees to develop and operate Cambria Hotels and Everhome Suites branded-hotels in strategic markets. During the three months ended March 31, 2026 and 2025, the Company invested $3.9 million and $5.4 million, respectively, to support these efforts.

Current wording

The Company has equity method investments in affiliates related to the Company's program to offer equity support to qualified franchisees to develop and operate Cambria Hotels and Everhome Suites branded-hotels in strategic markets. During the six months ended June 30, 2026 and 2025, the Company invested $10.6 million and $9.4 million, respectively, to support these efforts.

Previous wording

The Company provides financing to franchisees for hotel development efforts and other purposes in the form of notes receivable loans. The loans bear interest and are expected to be repaid in accordance with the terms of the loan agreements. During the three months ended March 31, 2026, the Company issued $0.2 million in notes receivable loans and received $24.6 million in notes receivable loan repayments. During the three months ended March 31, 2025, the Company issued $2.0 million in notes receivable loans and received $1.5 million in notes receivable loan repayments.

Current wording

The Company provides financing to franchisees for hotel development efforts and other purposes in the form of notes receivable loans. The loans bear interest and are expected to be repaid in accordance with the terms of the loan agreements. During the six months ended June 30, 2026, the Company issued $1.9 million in notes receivable loans and received $24.6 million in notes receivable loan repayments. During the six months ended June 30, 2025, the Company issued $3.4 million in notes receivable loans and received $2.8 million in notes receivable loan repayments.

Previous wording

On June 28, 2024, the Company entered into a Second Amended and Restated Senior Unsecured Credit Agreement (the "Restated Credit Agreement"). The Restated Credit Agreement increased the commitments under the Revolver to $1 billion and extended the final maturity date of the Revolver to June 28, 2029, subject to optional one-year extensions that can be requested by the Company prior to each of the third, fourth, and fifth anniversaries of the closing date of the Restated Credit Agreement.

Current wording

On June 28, 2024, the Company entered into a Second Amended and Restated Senior Unsecured Credit Agreement (the "Restated Credit Agreement"). The Restated Credit Agreement increased the commitments under the Revolver to $1 billion and extended the maturity date of the Revolver to June 28, 2029, subject to optional one-year extensions that can be requested by the Company prior to each of the third, fourth, and fifth anniversaries of the closing date of the Restated Credit Agreement.

Previous wording

The Restated Credit Agreement includes customary events of default, the occurrence of which, following any applicable cure period, would permit the lenders to, among other things, declare the principal, accrued interest and other obligations of the Company under the Restated Credit Agreement to be immediately due and payable. As of March 31, 2026, the Company maintained a total leverage ratio of 3.04x, including outstanding debt of approximately $566.3 million on the senior unsecured revolving credit facility. The Company was in compliance with all financial covenants under the Restated Credit Agreement.

Current wording

The Restated Credit Agreement includes customary events of default, the occurrence of which, following any applicable cure period, would permit the lenders to, among other things, declare the principal, accrued interest and other obligations of the Company under the Restated Credit Agreement to be immediately due and payable. As of June 30, 2026, the Company maintained a total leverage ratio of 3.02x, including outstanding debt of approximately $564.8 million on the senior unsecured revolving credit facility. The Company was in compliance with all financial covenants under the Restated Credit Agreement.

Previous wording

During the three months ended March 31, 2026, the Company paid $13.1 million in cash dividends. Based on the current per share dividend amount and our outstanding share count, the aggregate annual cash dividends for the year ended December 31, 2026 is projected to be $1.15 per share or approximately $52.6 million in aggregate dividend payments.

Current wording

During the six months ended June 30, 2026, the Company paid $26.3 million in cash dividends. Based on the current per share dividend amount and our outstanding share count, the aggregate annual cash dividends for the year ended December 31, 2026 is projected to be $1.15 per share or approximately $52.3 million in aggregate dividend payments.

Previous wording

The Company has a share repurchase program. Treasury stock activity is recorded at cost in the consolidated balance sheets. During the three months ended March 31, 2026, the Company repurchased 0.5 million shares of its common stock under the share repurchase program at a total cost, including accrued excise tax, of $47.8 million. As of March 31, 2026, the Company had 2.3 million shares remaining under the current share repurchase authorization.

Current wording

The Company has a share repurchase program. Treasury stock activity is recorded at cost in the consolidated balance sheets. During the six months ended June 30, 2026, the Company repurchased 0.9 million shares of its common stock under the share repurchase program at a total cost, including accrued excise tax, of $98.2 million. As of June 30, 2026, the Company had 1.8 million shares remaining under the current share repurchase authorization.

Previous wording

During the three months ended March 31, 2026, the Company redeemed 0.1 million shares of common stock at a total cost of $14.3 million from employees to satisfy the option exercise price and the statutory minimum tax-withholding requirements related to the exercising of stock options and the vesting of PVRSUs and restricted stock grants. These redemptions were outside the share repurchase program. During the three months ended March 31, 2026, the Company received proceeds of $0.9 million from stock options exercised by employees.

Current wording

During the six months ended June 30, 2026, the Company redeemed 0.1 million shares of common stock at a total cost of $14.4 million from employees to satisfy the stock option exercise price and the statutory minimum tax-withholding requirements related to the exercising of stock options and the vesting of PVRSUs and restricted stock grants. These redemptions were outside the share repurchase program. During the six months ended June 30, 2026, the Company received proceeds of $2.3 million from stock options exercised by employees.

Previous wording

The preparation of our consolidated financial statements in accordance with accounting principles generally accepted in the United States of America requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the consolidated financial statements, the reported amounts of revenues and expenses during the reporting periods, and the related disclosures in the consolidated financial statements and the accompanying footnotes. We have discussed the estimates that we believe are critical because they involve a higher degree of judgment in their application and are based on information that is inherently uncertain in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025. During the three months ended March 31, 2026, there were no material changes to the critical accounting estimates that were previously disclosed.

Current wording

The preparation of our consolidated financial statements in accordance with accounting principles generally accepted in the United States of America requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the consolidated financial statements, the reported amounts of revenues and expenses during the reporting periods, and the related disclosures in the consolidated financial statements and the accompanying footnotes. We have discussed the estimates that we believe are critical because they involve a higher degree of judgment in their application and are based on information that is inherently uncertain in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025. During the six months ended June 30, 2026, there were no material changes to the critical accounting estimates that were previously disclosed.

Previous wording

Several factors could cause our actual results, performance or achievements to differ materially from those expressed in or contemplated by the forward-looking statements. Such risks include, but are not limited to, changes to general, U.S. and foreign economic conditions, including access to liquidity and capital; changes in consumer demand and confidence, including consumer discretionary spending and the demand for travel, transient and group business; the timing and amount of future dividends and share repurchases; future U.S. or global outbreaks of epidemics, pandemics or contagious diseases or fear of such outbreaks, and the related impact on the global hospitality industry, particularly but not exclusively the U.S. travel market; changes in law and regulation applicable to the travel, lodging or franchising industries, including with respect to the status of our relationship with employees of our franchisees; the potential impact of new laws and regulations generally, including, without limitation, those relating to taxes, wages, labor and immigration; foreign currency fluctuations; changes in global interest rates and rate differentials; variability and unpredictability in trade relations, sanctions, tariffs or other trade controls; the federal government funding lapse and related government shutdowns; impairments or declines in the value of our assets; our assumptions underlying our critical accounting estimates; operating risks common in the travel, lodging or franchising industries; changes to the desirability of our brands as viewed by hotel operators and customers; changes to the terms or termination of our contracts with franchisees and our relationships with our franchisees; our ability to keep pace with improvements in technology utilized for our marketing and reservation systems and other operating systems; our ability to grow our franchise system; exposure to risks related to our hotel development, financing, franchise agreement acquisition costs and ownership activities; exposures to risks associated with our investments in new businesses; fluctuations in the supply and demand for hotel rooms; our ability to realize anticipated benefits from acquired businesses; impairments or losses relating to acquired businesses; the level of acceptance of alternative growth strategies we may implement; the impact of inflation; cyber security and data breach risks; introduction and integration of artificial intelligence technologies; climate change; our sustainability strategy; ownership and financing activities; hotel closures or financial difficulties of our franchisees; operating risks associated with our international operations; political instability, conflicts and terrorism; labor shortages; the outcome of litigation; and our ability to effectively manage our indebtedness and secure our indebtedness. These and other risk factors are discussed in detail in Item 1A. Risk Factors of this Quarterly Report on Form 10-Q and of the Company's A…

Excerpt shortened here; the source contains the full paragraph.

Current wording

Several factors could cause our actual results, performance or achievements to differ materially from those expressed in or contemplated by the forward-looking statements. Such risks include, but are not limited to, changes to general, U.S. and foreign economic conditions, including access to liquidity and capital; changes in consumer demand and confidence, including consumer discretionary spending and the demand for travel, transient and group business; the timing and amount of future dividends and share repurchases; future U.S. or global outbreaks of epidemics, pandemics or contagious diseases or fear of such outbreaks, and the related impact on the global hospitality industry, particularly but not exclusively the U.S. travel market; changes in law and regulation applicable to the travel, lodging or franchising industries, including with respect to the status of our relationship with employees of our franchisees; the potential impact of changes in laws and regulations generally, or the interpretation thereof, including, without limitation, those relating to taxes, wages, labor and immigration; foreign currency fluctuations; changes in global interest rates and rate differentials; variability and unpredictability in trade relations, sanctions, tariffs or other trade controls; governmental action or inaction relating to the federal budget, including funding lapses and government shutdowns; impairments or declines in the value of our assets; our assumptions underlying our critical accounting estimates; operating risks common in the travel, lodging or franchising industries; changes to the desirability of our brands as viewed by hotel operators and customers; changes to the terms or termination of our contracts with franchisees and our relationships with our franchisees; our ability to keep pace with improvements in technology utilized for our marketing and reservation systems and other operating systems; our ability to grow our franchise system; exposure to risks related to our hotel development, financing, franchise agreement acquisition costs and ownership activities; exposures to risks associated with our investments in new businesses; fluctuations in the supply and demand for hotel rooms; our ability to realize anticipated benefits from acquired businesses; impairments or losses relating to acquired businesses; the level of acceptance of alternative growth strategies we may implement; the impact of inflation; information technology, cyber security and data breach risks; introduction and integration of artificial intelligence technologies; climate change; our sustainability strategy; ownership and financing activities; hotel closures or financial difficulties of our franchisees; operating risks associated with our international operations; political instability, geopolitical conflicts and terrorism; labor shortages; the outcome of litigation; and our ability to effectively manage our indebtedness and secure our indebtedness. These and other ris…

Excerpt shortened here; the source contains the full paragraph.