This base of improvement was entirely driven by occupancy which went from being flat to up 1 point in December, to up over 6 points in January. Most of the occupancy increase was driven by week day room nights which grew 6% to 7% in December and January.

Leisure transient room nights remained consistently positive offsetting group declines. Rate continues to lag but periods of compression in December and January allowed us to improve rate realization from negative 12% in October to negative 9% in January. Year-over-year comparisons are also helped as we they lap the sharpest declines from prior year.

Last year at this time our group business was heading downhill fast but now we are seeing a few positive trends. In Q4, lead volume was up 15%, the first increase since the financial crisis broke. Cancellations in Q4 were down 50%. Although December group production was still well below last year, bookings into 2010 were up over 50% and bookings in the first half of 2010 were up over 100%.

So our booking window has shortened dramatically. In addition, businesses have started to confirm meetings that had been put on hold. Corporate renegotiations are ending better than we might have expected a few months ago. We are hearing from our corporate customers that cuts in travel are behind them companies want to get their people back on the road drumming up business and motivating their teams.

Internationally we are seeing similar trends with the sharpest base of recovery in Asia. Local currency RevPar at Company operated hotels in Asia went from negative 10% and 6% in October and November to positive 7% and 12% in December and January.

A 20 point swing over the past four months, as occupancy jumped from up 3-points to being up 9-points, while the rate decline in local currency moderated from minus 14% in October to minus 7% in January. The recovery was broad based across Asia led by China.

The only market that lags is Japan. Barring the recovery was in the quarter for the quarter business, up 20% in transient and up over 60% in group over the last year. Europe, Africa and the Middle East RevPar were down 2% in December, January after being down 12% in October, November.

Once again, occupancy turned positive and rate declines moderated. The trend in Europe tracks the U.S. In Africa and the Middle East, the UAE where we have a sizeable business was hurt by the debt crisis in Dubai. While Latin America is also recovering, it was our weakest region. South America is coming back strongly as H1N1 effects fade but Mexico which is tied closely to the U.S. remains weak.

In summary, across the world, there are clear signs of recovery, followed by late breaking transient, in particular, corporate business. That said, it is important to point out that we are digging out of a deep hole. While RevPar in Q4 exceeded expectations it was still down 10% in constant dollar worldwide. In our vacation ownership business, the trend toward stabilization continued.

Tours and close rates are holding up and pricing is under some pressure. By limiting capital allocated to this business, cutting costs and with two securitizations completed last year, SVO generated over $300 million in cash flow, contributing meaningfully to debt reduction that we achieved.

During the fourth quarter, we made a series of decisions in line with our future strategy for this business. We have decided not to develop some sites where we own the and had been investing to obtain permits and start construction. These projects have been written down to our best estimate of the fair value of the land.

At some of the projects where we have been completing current phases, we decided not to develop future phases. This requires us to write down the value of land as well as some infrastructure that would have benefited future phases. These decisions resulted in the write down of $255 million of SVO inventory and fixed assets.

Also, we are reducing prices at some projects to step up the pace of sales, requiring an adjustment of $17 million in cost of sales. This $17 million is recorded in the vacation ownership expenses line on the P&L. so this piece of the write-off is not recorded in the restructuring line but in the vacation ownership expenses line.

Finally, based on these decisions and as well as our future expectations for the business, we wrote off $90 million out of the $240 million in goodwill we had on the books for SVO from its acquisition in 1999. We are pleased with the cash the business generated last year and remain focused on running this business for cash in the foreseeable future.

What does all this tell us about 2010? As you can see, what could make or break 2010 is the strength of late breaking, in particular corporate transient business and our ability to improve rate realization as the quality of business improves. Group always lags and group based, while recovering from some sharp declines, would not point to a robust year. By definition late breaking business is hard to forecast.

As such, it is very difficult to look four quarters out with any reliability. In the final analysis, the pace of recovery in 2010 will depend on the long standing and still evident correlation between RevPar growth and GDP/corporate profit growth by region and country.

While it is tempting to extrapolate the most recent trend all the way through 2010, we think it would not be prudent to do so this early in the year for several reasons. Firstly, we lapped the steepest declines in the first two quarters, comparisons get somewhat tougher in the second half.

Second, GDP growth rate right now is about trend with inventory replenishment, fiscal and monetary stimulus. Will this be sustained as we enter the back half? Countries like China, India, Australia and Brazil are all taking steps to prevent their economies from overheating.

Could things cool down a bit in some of our fastest growing markets? Finally, we have taken a massive hit on rates. What will be the pace of rate improvement? It is too early to tell. The world remains an uncertain place with many unknowns.

That said, given expectations for a global recovery in GDP, corporate profits and our recent trends, we have substantially upgraded our RevPar outlook for 2010 from flat to down 5% to flat to up to 5% in constant dollars at Company operated hotels worldwide.