UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-K

(Mark One)

þx ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

for the fiscal year ended December 31, ~~2011~~2012

¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

for the transition period from to

Commission File Numbers:

SunGard Capital Corp. 000-53653

SunGard Capital Corp. II 000-53654

SunGard Data Systems Inc. 001-12989

SunGard^® Capital Corp.

SunGard^® Capital Corp. II

SunGard^® Data Systems Inc.

(Exact name of registrant as specified in its charter)


Delaware		20-3059890
Delaware		20-3060101
Delaware		51-0267091
(State of incorporation)		(I.R.S. Employer Identification No.)

680 East Swedesford Road, Wayne, Pennsylvania 19087

(Address of principal executive offices, including zip code)

484-582-2000

(Telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

None

Securities registered pursuant to Section 12(g) of the Act:

Restricted Stock Units Granting Conditional Rights to Units Consisting of:

Class A Common Stock of SunGard Capital Corp., par value $0.001 per share,

Class L Common Stock of SunGard Capital Corp., par value $0.001 per share, and

Preferred Stock of SunGard Capital Corp. II, par value $0.001 per share

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

SunGard Capital Corp. Yes ¨ No þx SunGard Capital Corp. II Yes ¨ No þx SunGard Data Systems Inc. Yes ¨ No þx

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

SunGard Capital Corp. Yes ¨ No þx SunGard Capital Corp. II Yes ¨ No þx SunGard Data Systems Inc. Yes þx No ¨

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

SunGard Capital Corp. Yes þx No ¨ SunGard Capital Corp. II Yes þx No ¨ SunGard Data Systems Inc. Yes ¨ No þx

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

SunGard Capital Corp. Yes þx No ¨ SunGard Capital Corp. II Yes þx No ¨ SunGard Data Systems Inc. Yes þx No ¨

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference into Part III of this Form 10-K or any amendment to this Form 10-K.

SunGard Capital Corp. þ¨ SunGard Capital Corp. II þ¨ SunGard Data Systems Inc. þx

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

SunGard Capital Corp. Large ~~acceleratedfiler~~accelerated filer ¨. Acceleratedfiler ¨. Non-acceleratedfiler þx. Smaller reportingcompany ¨. SunGard Capital Corp.II Large ~~acceleratedfiler~~accelerated filer ¨. Acceleratedfiler ¨. Non-acceleratedfiler þx. Smaller reportingcompany ¨. SunGard Data Systems Inc. Large ~~acceleratedfiler~~accelerated filer ¨. Acceleratedfiler ¨. Non-acceleratedfiler þx. Smaller reportingcompany ¨.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

SunGard Capital Corp. Yes ¨ No þx SunGard Capital Corp. II Yes ¨ No þx SunGard Data Systems Inc. Yes ¨ No þx

The aggregate market value of the registrants’ voting stock held by nonaffiliates is zero. The registrants are privately held corporations.

The number of shares of the registrants’ common stock outstanding as of March 1, ~~2012~~2013:

SunGard Capital Corp.:		256,~~624~~474,~~031~~160 shares of Class A common stock and 28,~~513~~497,~~717~~129 shares of Class L common stock
SunGard Capital Corp. II:		100 shares of common stock
SunGard Data Systems Inc.:		100 shares of common stock

DOCUMENTS INCORPORATED BY REFERENCE

None.

Table of Contents

		Page
Forward-Looking Statements		1	2
	PART I
Item 1.	Business	1	2
	Who We Are
	Segment Overview		3
	Our Strengths
	Financial Systems		3
	Our Business Strategy
	Availability Services		5
	Business Segment Overview	2
	Other		6
	Financial Systems	2
	Acquisitions		6
	Availability Services	4
	Product Development		6
	Other	6
	Marketing		7
	Acquisitions	6
	Brand and Intellectual Property		7
	Product Development	7
	Competition		7
	Marketing	7
	Employees		8
	Brand and Intellectual Property	7
Item 1A.	Risk Factors		8
	Competition	8
Item 1B.	Unresolved Staff Comments		18
	Employees	8
Item 2.	Properties		18
Item 1A.	Risk Factors	9
Item 3.	Legal Proceedings		18
Item 1B.	Unresolved Staff Comments	20
Item 4.	Mine Safety Disclosures		18
Item 2.	Properties	20
	PART II
Item 3.	Legal Proceedings	20
Item 5.	Market for Registrants’ Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities		19
Item 4.	Mine Safety Disclosures	20
Item 6.	Selected Financial Data		19
	PART II
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		21
Item 5.	Market for Registrants’ Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	20
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk		47
Item 6.	Selected Financial Data	21
Item 8.	Financial Statements and Supplementary Data		49
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	23
Item 9.	Changes In and Disagreements With Accountants on Accounting and Financial Disclosure		110
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	54
Item 9A.	Controls and Procedures		110
Item 8.	Financial Statements and Supplementary Data	55
Item 9B.	Other Information		111
Item 9.	Changes In and Disagreements With Accountants on Accounting and Financial Disclosure	115
	PART III
Item 9A.	Controls and Procedures	115
Item 10.	Directors, Executive Officers and Corporate Governance		112
Item 9B.	Other Information	117
Item 11.	Executive Compensation		116
	PART III
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters		145
Item 10.	Directors, Executive Officers and Corporate Governance	118
Item 13.	Certain Relationships and Related Transactions, and Director Independence		149
Item 11.	Executive Compensation	122
Item 14.	Principal Accountant Fees and Services		151
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	153
	PART IV
Item 13.	Certain Relationships and Related Transactions, and Director Independence	159
Item 15. Exhibits and Financial Statement Schedules			152
Item 14.	Principal Accountant Fees and Services	160
Signatures			153
	PART IV
List of Exhibits			154
Item 15.	Exhibits and Financial Statement Schedules	162
Signatures		163
List of Exhibits		164

Explanatory Note

This Annual Report on Form 10-K (“Report”) is a combined report being filed separately by three registrants: SunGard Capital Corp. (“SCC”), SunGard Capital Corp. II (“SCCII”) and SunGard Data Systems Inc. (“SunGard”). SCC and SCCII are collectively referred to as the “Parent Companies.” Unless the context indicates otherwise, any reference in this ~~report~~Report to the “Company,” “we,” “us” and “our” refer to the Parent Companies together with their direct and indirect subsidiaries, including SunGard. Each registrant hereto is filing on its own behalf all of the information contained in this ~~annual~~Report ~~report~~ that relates to such registrant. Each registrant hereto is not filing any information that does not relate to such registrant, and therefore makes no representation as to any ~~such~~ such information.

Forward-Looking Statements

PART I

ITEM 1.

BUSINESS

We are one of the world’s leading software and technology services companies. We provide software and technology services to financial services, education and public sector organizations. We also provide disaster recovery services, managed services, information availability consulting services and business continuity management software. We serve approximately 25,000 customers in more than 70 countries. Our high quality software solutions, excellent customer support and specialized technology services result in strong customer retention rates across all of our business segments and create long-term customer relationships. We believe that we are one of the most efficient operators of mission-critical IT solutions as a result of the economies of scale we derive from serving multiple customers on shared processing platforms.

We operate our business in three segments: Financial Systems (“FS”), Availability Services (“AS”) and Other, which is comprised of K-12 Education (“K-12”) and Public Sector (“PS”). On January 19 and 20, 2012, the Company completed the sale of its Higher Education (“HE”) business, which is included in discontinued operations for purposes of this Report ~~on Form 10-K~~.

FS provides mission-critical software and technology services to virtually every type of financial services institution, including buy-side and sell-side institutions, third-party administrators, wealth managers, retail banks, insurance companies, corporate treasuries and energy trading firms. Our broad range of complementary software solutions and associated technology services help financial services institutions automate the business processes associated with trading, managing portfolios and accounting for investment assets.

1AS provides disaster recovery services, managed services, information availability consulting services and business continuity management software to more than 8,000 customers in North America and Europe. With five million square feet of data center and operations space, AS assists IT organizations across virtually all industry and government sectors to prepare for and recover from emergencies by helping them minimize their computer downtime and optimize their uptime. Through direct sales and channel partners, AS helps organizations ensure their people and customers have uninterrupted access to the information systems they need in order to do business.

AS provides disaster recovery services, managed services, information availability consulting services and business continuity management software to over 9,000 customers in North America and Europe. With five million square feet of data center and operations space, AS assists IT organizations across virtually all industry and government sectors to prepare for and recover from emergencies by helping them minimize their computer downtime and optimize their uptime. Through direct sales and channel partners, AS helps organizations ensure their people and customers have uninterrupted access to the information systems they need in order to do business.

Other (K-12 and PS) provides software and technology services designed to meet the specialized needs of local, state and federal governments, public safety and justice agencies, public and private schools, utilities, nonprofits and other public sector institutions.

With a large portfolio of proprietary products and services in each of our three business segments, we have a diversified and stable business. Our base of approximately 25,000 customers includes most of the world’s largest financial services firms, a variety of other financial services firms, corporate and government treasury departments, energy companies, school districts, local governments and nonprofit organizations. Our AS business serves customers across virtually all industries. Our revenue is highly diversified by customer and product. During each of the past three fiscal years, no single customer has accounted for more than 103% of total revenue. On average for the past three fiscal years, services revenue has been approximately 91% of total revenue. About 80% of services revenue is highly recurring as a result of multiyear contracts and is generated from (1) software-related services including software maintenance and support, processing and rentals and (2) recovery and managed services. The remaining services revenue includes (1) professional services, which are ~~recurring~~mainly ingenerated ~~nature~~from asimplementation aand ~~result~~consulting ofservices ~~long-term~~in ~~customer~~connection ~~relationships~~with the sale of our products and (2) broker/dealer fees, which are largely correlated with trading volumes.

We were acquired in August 2005 in a leveraged buy-out (“LBO”) by a consortium of private equity investment funds associated with Bain Capital Partners, The Blackstone Group, Goldman, Sachs & Co., Kohlberg Kravis Roberts & Co., Providence Equity Partners, Silver Lake and TPG. As a result of the LBO, we are highly leveraged and our equity is not publicly traded.

Our Sponsors continually evaluate various strategic alternatives with respect to the Company~~, including a potential spin-off of the AS business to our current equity holders~~. We expect that if we were to spin-off the AS business, AS would incur new debt and we would repay a portion of our existing indebtedness. Additionally, along with any spin-off of AS, we would receive cash proceeds from an issuance of equity of one of our Parent Companies. There can be no assurance that we will ultimately pursue any strategic alternatives with respect to any business segment, ~~including AS,~~ or ~~an equity issuance or~~, if we do, what the structure or timing for any such transaction would be.

To the extent required by ITEM 1 of Form 10-K, financial information regarding our ~~business~~ segments is included in Note 1213 toof ~~our~~the Notes to Consolidated Financial Statements.

~~Business~~ Segment Overview

Financial Systems

FS provides mission critical software and technology services to financial services institutions, corporate and government treasury departments and energy companies. Our solutions automate the many complex business processes associated primarily with trading, managing investment portfolios and accounting for investment assets, and also address the processing requirements of a broad range of users within the financial services sector. In addition, we provide technology services that focus on application implementation and integration of these solutions, custom software development and application management. Since our inception, we have consistently enhanced our solutions to add new features, process new types of financial instruments, meet new regulatory requirements, incorporate new technologies and meet evolving customer needs on a global basis.

users within the financial services sector. In addition, we provide technology services that focus on application implementation and integration of these solutions, custom software development and application management. Since our inception, we have consistently enhanced our solutions to add new features, process new types of financial instruments, meet new regulatory requirements, incorporate new technologies and meet evolving customer needs.

We deliver many of our solutions as an application-service provider, primarily from our data centers located in North America and Europe that customers access through the Internet or virtual private networks. We also deliver some of our solutions by licensing the software to customers for use on their own computers and premises.

Our FS business offers software and technology services to a broad range of users, including asset managers, chief financial officers, compliance officers, custodians, fund administrators, insurers and reinsurers, market makers, plan administrators, registered investment advisors, treasurers, traders and wealth managers. ~~At the beginning of 2012, we realigned our~~ FS ~~businesses to better serve the needs of our customers. To provide our solutions, FS~~ is grouped into ~~businesses~~complementary solutions that focus on the specific requirements of our customers, as follows:

Asset Management: We offer solutions that help institutional investors, hedge funds, private equity firms, fund administrators and securities transfer agents improve both ~~investment~~ investment decision-making and operational efficiency, while managing risk and increasing transparency. Our solutions support every stage of the investment process, from research and portfolio management, to valuation, risk management, compliance, investment accounting, transfer agency and client reporting.

Banking: We provide banks with an integrated solution suite for asset/liability management, budgeting and planning, regulatory compliance and profitability. Our solutions also manage all aspects of universal banking including back-office transaction processing, front-office multichannel delivery, card management and payments.

Capital Markets: Our capital markets solutions help banks, broker/dealers, futures commission merchants and other financial institutions to increase the efficiency, transparency and control of their trading operations across multiple platforms, asset classes and markets. Supporting the entire trade lifecycle from front-to-back, these solutions provide everything from connectivity, execution services and risk management to securities finance, collateral management and compliance. Additionally, these solutions help customers to create and manage consolidated views across all their positions and risk.

Corporate Liquidity & Energy: Our solutions for corporate liquidity help businesses facilitate connectivity between their buyers, suppliers, banks, data providers and other stakeholders to increase visibility of cash, improve communication and response time, reduce risk, and help drive maximum value from working capital. Our end-to-end collaborative financial management framework helps chief financial officers and treasurers bring together receivables, treasury and payments for a single view of cash and risk, and to optimize business processes for enhanced liquidity management. Our energy and commodities solutions help energy companies, corporate hedgers, hedge funds and financial services firms to compete efficiently in global energy and commodities markets by streamlining and integrating the trading, risk management and operations of physical commodities and their associated financial instruments.

Insurance: We provide solutions for the insurance industry in each of the following major business lines: life and health, annuities and pensions, property and casualty, reinsurance and

~~asset~~efficiency, ~~management.~~while ~~Our~~managing ~~software~~risk and ~~services~~increasing ~~support~~transparency. ~~functions~~Our ~~from~~solutions ~~the~~support ~~front-office~~every ~~through~~stage of the ~~back-office~~investment process, from ~~customer~~research ~~service, policy administration~~ and ~~actuarial~~portfolio ~~calculations~~management, to ~~financial~~valuation, risk management, ~~and~~compliance, investment accounting, transfer agency and client reporting.

~~Wealth Management~~Banking: We Our ~~provide~~banking ~~wealth~~solutions ~~management~~help ~~solutions~~retail, ~~that~~corporate ~~help~~and international private banks, ~~trust~~to ~~companies~~better manage their customers, ~~brokerage~~capital ~~firms~~and staff. We provide integrated solution suites for asset/liability management, ~~insurance~~budgeting ~~firms~~and planning, ~~benefit~~regulatory ~~administrators~~compliance and ~~independent~~profitability. ~~advisors~~We ~~acquire~~offer retail banks a range of solutions helping them address core banking, ~~service~~online and ~~grow~~mobile ~~their~~banking, ~~client~~as ~~relationships~~well as customer and card management requirements. We also provide front-to-back-office solutions for ~~client~~equipment ~~acquisition,~~finance ~~transaction~~organizations ~~management,~~and help ~~trust~~international ~~accounting~~private ~~and~~banks ~~recordkeeping~~with ~~that~~core ~~can~~banking, bechannel ~~deployed~~and asclient ~~stand-alone~~management, ~~products~~and various ASP services. Finally, orwe asprovide ~~part~~enterprise ofmatching anand ~~integrated~~reconciliation ~~wealth~~solutions ~~management~~to ~~platform~~financial institutions.

Brokerage: Our brokerage solutions provide trade execution and network solutions to financial institutions, corporations and municipalities in North America, Europe and other global markets. Our trade execution and network solutions help both buy- and sell-side firms improve execution quality, minimize information leakage, decrease overall execution costs and address today’s trade connectivity challenges.

Capital Markets: Our capital markets solutions help banks, broker/dealers, futures commission merchants and other financial institutions to increase the efficiency, transparency and control of their trading operations across multiple platforms, asset classes and markets. Supporting the entire trade lifecycle from front-to-back, these solutions provide everything from connectivity, execution services and risk management to securities finance, collateral management and compliance. Additionally, these solutions help customers to create and manage consolidated views across all their positions and risk.

Corporate Liquidity: Our solutions for corporate liquidity help businesses facilitate connectivity between their buyers, suppliers, banks, data providers and other stakeholders to increase visibility of cash, improve communication and response time, reduce risk, and help drive maximum value from working capital. Our end-to-end collaborative financial management framework helps chief financial officers and treasurers bring together receivables, treasury and payments for a single view of cash and risk, and to optimize business processes for enhanced liquidity management.

Energy. Our energy and commodities solutions help energy companies, corporate hedgers, hedge funds and financial services firms to compete efficiently in global energy and commodities markets by streamlining and integrating the trading, risk management and operations of physical commodities and their associated financial instruments.

Insurance: We provide solutions for the insurance industry in each of the following major business lines: life and health, annuities and pensions, property and casualty, reinsurance and asset management. Our software and services support functions from the front-office through the back-office, from customer service, policy administration and actuarial calculations to financial and investment accounting and reporting.

Wealth & Retirement Administration: We provide wealth management solutions that help banks, trust companies, brokerage firms, insurance firms, benefit administrators and independent advisors acquire, service and grow their client relationships. We provide solutions for client acquisition, transaction management, trust accounting and recordkeeping that can be deployed as stand-alone products, or as part of an integrated wealth management platform.

FS also has a global services organization that delivers business consulting, technology and managed and professional services for financial services institutions, energy companies and corporations. Leveraging our global delivery model, our consultants and developers worldwide help customers manage their complex data needs, optimize end-to-end business processes and assist with systems integration, while providing full application development, maintenance, testing and support services.

The FS segment is organized to align with customer-facing business areas. FS revenue by business area based on the 2011 organizational structure was as follows (in millions):

	2010		2011
Capital Markets	$	670	$	730
Global Trading		659		567
Asset Management		362		388
Wealth Management		389		367
Banking		203		229
Corporate Liquidity		175		190
Insurance		175		175
Other		174		189
Total Financial Systems	$	2,807	$	2,835

FS revenues by customer-facing business area based on the new 2012 alignment (in millions):

	2010		2011
Capital Markets	$	1,166	$	1,129
Asset Management		430		466
Wealth Management		374		357
Corporate Liquidity & Energy		257		264
Banking		231		252
Insurance		175		175
Other		174		192
Total Financial Systems	$	2,807	$	2,835

Availability Services

AS helps customers improve the resilience of their mission critical systems by designing, implementing and managing cost-effective solutions using people, processes and technology to address enterprise IT availability needs. As the pioneer of commercial disaster recovery in the 1970s, we believe our specialization in information availability solutions, together with our vast experience, technology expertise, resource management capabilities, vendor neutrality and diverse service

~~offerings,~~Availability ~~have~~Services uniquely positioned us to meet customers’ varied needs in an environment in which businesses are critically dependent on the availability of IT. Our comprehensive portfolio of services extends from always-ready standby services to high availability advanced recovery services and always-on production and managed services. This includes planning and provisioning of enterprise cloud computing and SaaS platforms. Additionally, we provide business continuity management software and consulting services to help customers design, implement and maintain plans to protect their central business systems. To serve our more than 9,000 customers, we have approximately 5,000,000 square feet of data center and operations space at over 80 facilities in ten countries. Since inception, we have helped customers recover from unplanned interruptions resulting from major disasters including the Gulf Coast hurricanes in 2008, widespread flooding in the UK in 2007, hurricane Katrina and Gulf Coast hurricanes in 2005, Florida hurricanes in 2004, the Northeast U.S. blackout in 2003, and the terrorist attacks of September 11, 2001.

WeAS ~~provide~~helps customers improve the ~~following~~resilience ~~four~~of ~~categories~~their mission critical systems by designing, implementing and managing cost-effective solutions using people, processes and technology to address enterprise IT availability needs. As the pioneer of commercial disaster recovery in the 1970s, we believe our specialization in information availability solutions, together with our vast experience, technology expertise, resource management capabilities, vendor neutrality and diverse service offerings, have uniquely positioned us to help meet customers’ varied needs in an environment in which businesses are critically dependent on the availability of IT. Our comprehensive portfolio of services: extends from always-ready standby services to high availability advanced recovery services, and always-on production and managed services,. ~~consulting~~This ~~services~~includes planning and provisioning of enterprise cloud computing and SaaS platforms. Additionally, we provide business continuity management software. ~~The~~and ~~combination~~consulting ofservices ~~all~~to ~~services~~help ~~provides~~customers design, implement and maintain plans to protect their central business systems. To serve our more than 8,000 customers, ~~with~~we ahave ~~complete~~approximately ~~set~~5,000,000 square feet of ITdata center and operations space at over 90 facilities in ten countries. Since inception, we have helped customers recover from unplanned interruptions resulting from major disasters including hurricane Sandy in 2012, the Gulf Coast hurricanes in 2008, widespread flooding in the UK in 2007, hurricane Katrina and ~~information~~Gulf ~~availability~~Coast ~~management~~hurricanes ~~solutions~~in 2005, Florida hurricanes in 2004, the Northeast U.S. blackout in 2003, and the terrorist attacks of September 11, 2001.

~~Although~~We ~~high~~provide ~~availability~~the ~~and~~following ~~recovery~~four ~~services~~categories ~~remain~~of ~~our~~services: ~~principal~~recovery ~~revenue generating~~ services, managed services, consulting services and business continuity management software. ~~increasingly~~The ~~account for~~combination aof ~~greater~~all ~~percentage~~ of ~~new~~these ~~sales. Because advanced recovery and managed~~ services ~~are~~provides ~~often~~our ~~unique to individual~~ customers ~~and~~with ~~utilize~~ a ~~greater~~complete ~~proportion~~set of ~~dedicated~~IT ~~(versus~~operations ~~shared)~~and ~~resources,~~information ~~they~~availability ~~typically~~management ~~require modestly more capital expenditures. Cloud~~ solutions~~, however, are changing industry economics to allow for lower-cost, partially dedicated solutions~~.

~~Recovery~~Although ~~Services: We~~high ~~help~~availability ~~customers maintain access to the information~~ and ~~computer~~recovery ~~systems~~services ~~needed~~remain toas ~~run their~~important ~~businesses~~revenue bygenerating ~~providing~~services, ~~cost-effective~~including ~~solutions~~our torecently ~~keep~~introduced managed ITrecovery ~~systems~~program ~~operational and secure in the event of an unplanned business disruption. These business disruptions can range from man-made events~~ (~~e.g.~~“MRP”), ~~power~~managed ~~outages~~services, ~~telecommunications disruptions~~consulting services and ~~acts~~business ofcontinuity ~~terrorism)~~management tosoftware ~~natural~~increasingly ~~disasters~~account ~~(e.g.,~~for ~~floods, hurricanes and earthquakes). We offer~~ a ~~complete~~greater ~~range~~percentage of ~~recovery~~new ~~services tailored to application uptime requirements~~sales. ~~These~~Because ~~requirements~~advanced ~~are~~recovery ~~typically based on the criticality of the supported business processes. Some of these solutions can be delivered using processors, servers, storage devices, networks~~ and ~~other~~managed ~~resources~~services ~~and infrastructure that~~ are ~~subscribed~~often unique to byindividual ~~multiple~~ customers. ~~Recovery services range from basic standby infrastructure recovery services, workforce continuity services,~~ and ~~mobile~~utilize ~~recovery options to advanced recovery or high availability solutions. Managed recovery services represents~~ a ~~growing~~greater ~~area,~~proportion ~~with industry regulations and the growing complexity~~ of ~~heterogeneous~~dedicated ~~environments~~ (~~i.e.,~~versus ~~cloud,~~shared) ~~virtual~~resources, ~~physical)~~they ~~fuelling~~typically ~~demand.~~require ~~Our~~modestly ~~managed~~more ~~recovery~~capital ~~program~~expenditures. ~~offering—in~~Cloud ~~which AS personnel lead planning~~solutions, ~~set-up~~however, ~~maintenance,~~are ~~testing~~changing ~~and~~industry ~~execution~~economics ofto aallow ~~recovery solution—addresses key customer needs. Demand has also increased~~ for ~~cloud~~lower-~~based~~cost, ~~recovery~~partially dedicated ~~services~~solutions.

~~Managed~~ Recovery Services: We ~~provide~~help ITcustomers ~~infrastructure~~maintain ~~and~~access ~~production~~to ~~services~~the ~~that~~information ~~customers~~and ~~use~~computer systems needed to run their businesses onby aproviding ~~day~~cost-effective solutions to~~-day~~ ~~basis~~keep IT systems operational and secure in the event of an unplanned business disruption. These ~~services~~business disruptions can range from coman-~~located~~made ITevents ~~infrastructure~~ (e.g., wepower ~~provide data center space~~outages, ~~power,~~telecommunications ~~cooling~~disruptions and ~~network~~acts ~~connectivity~~of terrorism) to ~~fully~~natural ~~managed~~disasters ~~infrastructure services~~ (e.g., wefloods, ~~fully~~hurricanes ~~manage~~and ~~the~~earthquakes). ~~daily~~We ~~operation~~offer a complete range of arecovery ~~customer’s~~services ITtailored ~~infrastructure)~~to application uptime requirements. ~~Managed~~These ~~services~~requirements ~~help~~are ~~customers~~typically ~~augment~~based on ~~their~~the ITcriticality of the supported business processes. Some of these solutions can be delivered using processors, servers, storage devices, networks and other resources and ~~skills~~infrastructure ~~without~~that are subscribed to by multiple customers. Recovery ~~having~~services range from basic standby infrastructure recovery services, workforce continuity services, and mobile recovery options to ~~hire~~advanced ~~full-time~~recovery ~~internal~~or IThigh ~~staff~~availability solutions. Managed recovery services represent a growing area, with industry regulations and ~~make~~the ~~capital~~growing ~~investments~~complexity of heterogeneous environments (i.e., cloud, virtual, physical) fueling demand. Our MRP offering—in ~~infrastructure~~which AS personnel lead planning, set-up, maintenance, testing and execution of a recovery solution—addresses key customer needs, including on their own premises. InOur ~~addition~~ability to ~~managed~~provide ~~hosting~~MRP ~~services~~on ~~for~~the ~~physical~~customers’ ~~infrastructures,~~premises ~~cloud~~provides ~~hosting~~value asto ~~well~~enterprises asthat ~~managed~~have ~~services~~made ~~solutions~~investments ~~spanning~~to execute their recovery requirements on-site. Demand has also increased for cloud-based recovery services.

Managed Services: We provide IT infrastructure and production services that customers use to run their businesses on a day-to-day basis. These services range from co-located IT infrastructure (e.g., we provide data center space, power, cooling and network connectivity) to fully managed infrastructure services (e.g., we fully manage the daily operation of a customer’s IT infrastructure). Managed services help customers augment their IT resources and skills without having to hire full-time internal IT staff and make capital investments in infrastructure. In addition to managed hosting services for physical infrastructures, cloud hosting as well as managed services solutions spanning mixed physical and virtual environments are becoming more commonplace. In 2010, we launched enterprise-grade cloud services and have augmented

~~mixed physical and virtual environments are becoming more commonplace. In 2010, we launched enterprise-grade cloud services and have augmented~~ these with high availability, multi-site solutions and private cloud options in 2011. Geographically, we deliver cloud services out of the U.S., Canada and Great Britain and a ~~lower~~self-~~cost~~service cloud option out of Ireland.

Consulting Services: We offer consulting services to help customers solve critical business availability and IT infrastructure problems. ASOur ~~realigned~~six ~~its~~primary ~~consulting organization~~practice inareas ~~2011~~are toinformation ~~follow~~lifecycle agovernance, ~~traditional~~data ~~partner-led~~protection, ~~practice~~cloud, ~~model~~business continuity management, disaster recovery cost optimization and data center outsourcing. Current capabilities include enterprise resiliency, technology architecture, ~~and~~ infrastructure operations and operational risk, taken to market through vertical practices focused in financial services, healthcare, manufacturing, energy and outsourcing. ~~Consulting services focused on addressing operational risk primarily for financial institutions were also launched in 2011.~~

Business Continuity Management Software: We provide customized software that facilitates business continuity, with automated business continuity management (BCM) systems and incident management modules for more than 1,~~600~~500 customers. There are strong growth prospects driven by customers’ lack of internal IT expertise, the required familiarity with the regulatory environment and the growing demand for centralization of BCM planning and governance.

Availability Services operates across the UK and in Europe, delivering a very similar set of services as in the Americas. With locations in the UK, Ireland, France, Sweden, Belgium and Luxembourg, we have considerable ability to support customers from the European Union ~~territories~~. In ~~Recently~~addition, ~~opened~~we ~~India~~have Indian operations ~~provides~~which provide workforce continuity services out of ~~two~~three locations.

Other

K-12 Education: We provide administrative information software solutions and related implementation and support services for K-12 school districts and private schools throughout the United States. Our software and technology services help school districts improve the efficiency of their operations and use Web-based technologies to serve their constituents. We offer a fully integrated suite of products for student information, learning management, special education, financial and human resource activities.

Public Sector: PS provides software and technology services designed to meet the specialized needs of local, state and federal governments, public safety and justice agencies, utilities and public sector institutions as well as nonprofits. More than ~~120~~115 million citizens in North America live in municipalities that rely on our products and services. Our public administration solutions support a range of specialized enterprise resource planning and administrative processes for functions such as accounting, human resources, payroll, utility billing, land management and managed IT services. Public safety and justice agencies use our solutions to manage emergency dispatch operations, citizen and incident records, mobile computing in the field, and the operation of courts and jails. Our e-Government solutions help local governments to use the Internet and wireless technologies to serve their constituents. In December 2010, we sold our Public Sector U.K. operation.

Acquisitions

To complement our organic growth, we have a highly disciplined program to identify, evaluate, execute and integrate acquisitions. Generally, we seek to acquire businesses that broaden our existing product lines and service offerings by adding complementary products and service offerings and by expanding our geographic reach. During 2012, we spent approximately $40 million in cash to acquire two businesses. The following table lists the businesses we acquired in 2012:


Acquired Company/Business	Date Acquired	Description
Syntesys	01/05/12	A European SWIFT service bureau and network of business and technical experts dedicated to serving the SWIFT community.
XcitekSolutionsPlus, LLC (“XSP”)	12/21/12	A leading provider of end-to-end, automated corporate actions solutions.

expanding our geographic reach. During 2011, we spent approximately $35 million in cash to acquire five businesses. The following table lists the businesses we acquired in 2011:

Acquired Company/Business	Date Acquired	Description
PredictiveMetrics, Inc.	01/31/11	A provider of predictive scoring and analytical services.
Valuelink Information Systems Limited	03/22/11	A provider of validated financial data solutions.
Stratix Technologies Inc.	03/31/11	A provider of IT consulting services to Canadian financial services companies.
Finace	8/31/11	A provider of securities lending and collateral management software.
Northern Arch	9/30/11	A global leasing and financing process management solution.

Product Development

We continually support, upgrade and enhance our systems and develop new products to meet the needs of our customers for operational efficiency and resilience and to leverage advances in technology.

Our expenditures for software development during the years ended December 31, 2010 and 2011, including amounts that were capitalized, totaled approximately $191 million and $212 million, respectively. In 2010 and 2011, software development expenses were 6% and 7%, respectively, of revenue from software and processing solutions. These amounts do not include routine software support costs, nor do they include costs incurred in performing certain customer-funded development projects in the ordinary course of business.

Our expenditures for software development during the years ended December 31, 2011 and 2012, including amounts that were capitalized, totaled approximately $190 million and $185 million, respectively. In 2011 and 2012, software development expenses were 4% and 4%, respectively, of revenue from software and processing solutions. These amounts do not include routine software support costs, nor do they include costs incurred in performing certain customer-funded development projects in the ordinary course of business.

Marketing

Most of our FS solutions are marketed throughout North America and Western Europe and many are marketed worldwide, including Asia Pacific, Central and Eastern Europe, the Middle East, Africa and Latin America. Our AS solutions are marketed primarily in North America and Europe. Our K-12 and PS solutions are marketed in North America. Our revenue from sales outside the United States during the years ended December 31, ~~2009~~2010, ~~2010~~2011 and ~~2011~~ 2012 totaled approximately $1.4547 billion, $1.5061 billion and $1.6754 billion, respectively.

Brand and Intellectual Property

We own registered marks for the SUNGARD name and own or have applied for trademark registrations for many of our services and software products.

To protect our proprietary services and software, we rely upon a combination of copyright, patent, trademark and trade secret law, confidentiality restrictions in contracts with employees, customers and others, software security measures, and registered copyrights and patents. We also have established policies requiring our personnel and representatives to maintain the confidentiality of our proprietary property. We have a ~~few registrations of our copyrights and a~~ number of patents and patent applications pending as well as a few registrations of our copyrights. We will continue to apply for software and business method patents on a case-by-case basis and will continue to monitor ongoing developments in the evolving software and business method patent field (see ITEM 1A—RISK FACTORS).

case-by-case basis and will continue to monitor ongoing developments in the evolving software and business method patent field (see ITEM 1A—RISK FACTORS).

Competition

Because most of our computer services and software solutions are specialized and technical in nature, most of the niche areas in which we compete have a relatively small number of significant competitors. Some of our existing competitors and some potential competitors have substantially greater financial, technological and marketing resources than we have.

Financial Systems. In our FS business, we compete with numerous other data processing and software vendors that may be broadly categorized into two groups. The first group is comprised of specialized financial systems companies that are much smaller than we are. The second group is comprised of large computer services companies whose principal businesses are not in the financial systems area, some of which are also active acquirors. We also face competition from the internal processing and IT departments of our customers and prospects. The key competitive factors in marketing financial systems are the accuracy and timeliness of processed information provided to customers, features and adaptability of the software, level and quality of customer support, degree of responsiveness, level of software development expertise, total cost of ownership and return on investment. We believe that we compete effectively with respect to each of these factors and that our leadership, reputation and experience in this business are important competitive advantages.

Availability Services. In our AS business, the greatest source of competition for recovery and advanced recovery services is in-house dedicated solutions that the enterprise develops and maintains internally instead of purchasing from a services provider. The declining cost of infrastructure has made these solutions more accessible, yet the growing complexity of IT environments driven by cloud and virtualization has increased the challenge of sustaining in-house business continuity programs. Historically, the single largest commercial competitor for recovery and advanced recovery services has been IBM Corporation, which, like us, currently ~~provides~~ the full continuum of information availability services. We also face moderate competition from specialized vendors, including hardware manufacturers, data-replication and virtualization software companies, outsourcers, managed hosting companies; IT services companies and telecommunications companies. Competition among managed services, including cloud and data center service providers, is fragmented across various competitor types, such as major telecommunication providers, IT outsourcers, niche cloud vendors, real estate investment trusts and regional colocation providers. We compete effectively with respect to the key competitive dimensions in the information availability industry, namely economies of scale, quality of infrastructure, scope and quality of services, including breadth of supported hardware platforms and network capacity, level and quality of customer support, level of technical expertise, vendor neutrality, and price. We are positioned with important competitive advantages including our experience, reliability and reputation as an innovator in information availability solutions, our proven track record, our financial stability and our ability to provide the entire portfolio of information availability services as a single vendor solution.

~~Employees~~7

As of December 31, 2011, we had approximately 17,500 employees in continuing operations. Our success depends partly on our continuing ability to retain and attract skilled technical, sales and management personnel. While skilled personnel are in high demand and competition exists for their talents, we have been able to retain and attract highly qualified personnel (see ITEM 1A—RISK FACTORS). We believe that our employee relations are excellent.

provides the full continuum of information availability services. We also face moderate competition from specialized vendors, including hardware manufacturers, data-replication and virtualization software companies, outsourcers, managed hosting companies; IT services companies and telecommunications companies. Competition among managed services, including cloud and data center service providers, is fragmented across various competitor types, such as major telecommunication providers, IT outsourcers, niche cloud vendors, real estate investment trusts and regional colocation providers. We compete effectively with respect to the key competitive dimensions in the information availability industry, namely economies of scale, quality of infrastructure, scope and quality of services, including breadth of supported hardware platforms and network capacity, level and quality of customer support, level of technical expertise, vendor neutrality, and price. We are positioned with important competitive advantages including our experience, reliability and reputation as an innovator in information availability solutions, our proven track record, our financial stability and our ability to provide the entire portfolio of information availability services as a single vendor solution.

Employees

As of December 31, 2012, we had approximately 17,000 employees. Our success depends partly on our continuing ability to retain and attract skilled technical, sales and management personnel. While skilled personnel are in high demand and competition exists for their talents, we have been able to retain and attract highly qualified personnel (see ITEM 1A—RISK FACTORS).

ITEM 1A.

RISK FACTORS

Certain of the matters we discuss in this Report ~~on Form 10-K~~ may constitute forward-looking statements. You can identify forward-looking statements because they contain words such as “believes,” “expects,” “may,” “will,” “should,” “seeks,” “approximately,” “intends,” “plans,” “estimates,” or “anticipates” or similar expressions which concern our strategy, plans or intentions. All statements we make relating to estimated and projected earnings, margins, costs, expenditures, cash flows, growth rates and financial results are forward-looking statements. In addition, we, through our senior management, from time to time make forward-looking public statements concerning our expected future operations and performance and other developments. All of these forward-looking statements are subject to risks and uncertainties that may change at any time, and, therefore, our actual results may differ materially from those we expected. We derive most of our forward-looking statements from our operating budgets and forecasts, which are based upon many detailed assumptions. While we believe that our assumptions are reasonable, we caution that it is very difficult to predict the impact of known factors, and, of course, it is impossible for us to anticipate all factors that could affect our actual results. Some of the factors that we believe could affect our results include:

• ~~general~~global economic and market conditions;

•

the condition of the financial services industry, including the effect of any further consolidation among financial services firms;

•

our high degree of debt-related leverage;

•

the effect of war, terrorism, natural disasters or other catastrophic events;

•

the effect of disruptions to our systems and infrastructure;

•

the timing and magnitude of software sales;

•

the timing and scope of technological advances;

•

customers taking their information availability solutions in-house;

•

the trend in information availability toward solutions utilizing more dedicated resources;

•

the market and credit risks associated with broker/dealer operations;

•

the ability to retain and attract customers and key personnel;

•

risks relating to the foreign countries where we transact business;

•

the integration and performance of acquired businesses;

•

the ability to obtain patent protection and avoid patent-related liabilities in the context of a rapidly developing legal framework for software and business-method patents;

•

a material weakness in our internal controls; and

• unanticipated changes in our income tax provision or the ~~adoption~~enactment of new tax legislation, issuance of regulations or relevant judicial decisions.

The factors described in this paragraph and other factors that may affect our business or future financial results, as and when applicable, are discussed in our filings with the United States Securities and Exchange Commission (“SEC”), including this Report ~~on Form 10-K~~. We assume no obligation to update any written or oral forward-looking statements made by us or on our behalf as a result of new information, future events or other factors.

Risks Related to Our Indebtedness

Our substantial leverage could adversely affect our ability to raise additional capital to fund our operations, limit our ability to react to changes in the economy or our industry, expose us to interest rate risk to the extent of our variable rate debt and prevent us from meeting our debt obligations.

As a result of being acquired on August 11, 2005 by a consortium of private equity investment funds, we are highly leveraged and our debt service requirements are significant.

Our high degree of debt-related leverage could have important consequences, including:

•

making it more difficult for us to make payments on our debt obligations;

•

increasing our vulnerability to general economic and industry conditions;

•

requiring a substantial portion of cash flow from operations to be dedicated to the payment of principal and interest on our indebtedness, therefore reducing our ability to use our cash flow to fund our operations, capital expenditures and future business opportunities;

•

exposing us to the risk of increased interest rates as certain of our borrowings, including borrowings under our senior secured credit facilities, are at variable rates of interest;

•

restricting us from making acquisitions or causing us to make non-strategic divestitures;

•

limiting our ability to obtain additional financing for working capital, capital expenditures, product development, debt service requirements, acquisitions and general corporate or other purposes; and

•

limiting our ability to adjust to changing market conditions and placing us at a competitive disadvantage compared to our competitors who are less highly leveraged.

We and our subsidiaries may be able to incur substantial additional indebtedness in the future, subject to the restrictions contained in our senior secured credit agreement and the indentures relating to our senior notes due ~~2015,~~ 2018 and 2020 and senior subordinated notes due ~~2015~~2019. If new indebtedness is added to our current debt levels, the related risks that we now face could intensify.

Our debt agreements contain restrictions that limit our flexibility in operating our business.

Our senior secured credit agreement and the indentures governing our senior notes due ~~2015,~~ 2018 and 2020 and senior subordinated notes due ~~2015~~2019 contain various covenants that limit our ability to engage in specified types of transactions. These covenants limit our ability to, among other things:

•

incur additional indebtedness or issue certain preferred shares;

•

pay dividends on, repurchase or make distributions in respect of our capital stock or make other restricted payments;

•

make certain investments;

•

sell certain assets;

•

create liens;

•

consolidate, merge, sell or otherwise dispose of all or substantially all of our assets; and

•

enter into certain transactions with our affiliates.

10In addition, under the senior secured credit agreement, under certain circumstances, we are required to satisfy and maintain specified financial ratios and other financial condition tests. Our ability to meet those financial ratios and tests can be affected by events beyond our control, and we may not be able to meet those ratios and tests. A breach of any of these covenants could result in a default under the senior secured credit agreement. Upon an event of default under the senior secured credit agreement, the lenders could elect to declare all amounts outstanding to be immediately due and payable and terminate all commitments to extend further credit.

~~Table~~If we were unable to repay those amounts, the lenders under the senior secured credit agreement could proceed against the collateral granted to them to secure that indebtedness. We have pledged a significant portion of ~~Contents~~our assets as collateral under the senior secured credit agreement and the senior secured notes due 2014, to the extent required by the indenture governing these notes. If the lenders under the senior secured credit agreement accelerate the repayment of borrowings, we may not have sufficient assets to repay the senior secured credit facilities and the senior notes, as well as our unsecured indebtedness.

In addition, under the senior secured credit agreement, we are required to satisfy and maintain specified financial ratios and other financial condition tests. Our ability to meet those financial ratios and tests can be affected by events beyond our control, and we may not be able to meet those ratios and tests. A breach of any of these covenants could result in a default under the senior secured credit agreement. Upon an event of default under the senior secured credit agreement, the lenders could elect to declare all amounts outstanding to be immediately due and payable and terminate all commitments to extend further credit.

If we were unable to repay those amounts, the lenders under the senior secured credit agreement could proceed against the collateral granted to them to secure that indebtedness. We have pledged a significant portion of our assets as collateral under the senior secured credit agreement and the senior notes due 2014, to the extent required by the indenture governing these notes. If the lenders under the senior secured credit agreement accelerate the repayment of borrowings, we may not have sufficient assets to repay the senior secured credit facilities and the senior notes, as well as our unsecured indebtedness.

Risks Related to Our Business

Our business depends largely on the economy and financial markets, and a slowdown or downturn in the economy or financial markets could adversely affect our business and results of operations.

When there is a slowdown or downturn in the economy, a drop in stock market levels or trading volumes, or an event that disrupts the financial markets, our business and financial results may suffer for a number of reasons. Customers may react to worsening conditions by reducing their capital expenditures in general or by specifically reducing their IT spending. In addition, customers may curtail or discontinue trading operations, delay or cancel IT projects, or seek to lower their costs by renegotiating vendor contracts. Also, customers with excess IT resources may choose to take their information availability solutions in-house rather than obtain those solutions from us. Moreover, competitors may respond to market conditions by lowering prices and attempting to lure away our customers to lower cost solutions. If any of these circumstances remain in effect for an extended period of time, there could be a material adverse effect on our financial results. Because our financial performance tends to lag behind fluctuations in the economy, our recovery from any particular downturn in the economy may not occur until after economic conditions have generally improved.

Our business depends to a significant degree on the financial services industry, and a weakening of, or further consolidation in, or new regulations affecting, the financial services industry could adversely affect our business and results of operations.

Because our customer base is concentrated in the financial services industry, our business is largely dependent on the health of that industry. When there is a general downturn in the financial services industry, or if our customers in that industry experience financial or business problems, including bankruptcies, our business and financial results may suffer. If financial services firms continue to consolidate, there could be a material adverse effect on our business and financial results. When a customer merges with a firm using its own solution or another vendor’s solution, it could decide to consolidate on a non-SunGard system, which could have an adverse effect on our financial results.

To10 the extent newly adopted regulations negatively impact the business, operations or financial condition of our customers, our business and financial results could be adversely affected. We could be required to invest a significant amount of time and resources to comply with additional regulations or

toadverse ~~modify~~effect ~~the~~on ~~manner in which we provide products and services to~~ our ~~customers;~~business and ~~such~~financial ~~regulations could limit how much we can charge for our services~~results. WeWhen ~~may~~a ~~not~~customer bemerges ~~able~~with toa ~~update~~firm ~~our existing~~using ~~products~~its ~~and~~own ~~services,~~solution or ~~develop~~another ~~new~~vendor’s ~~ones~~solution, atit ~~all~~could ordecide ~~in a timely manner,~~ to ~~satisfy~~consolidate ~~our~~on ~~customers’~~a ~~needs. Any of these events~~non-SunGard system, ifwhich ~~realized,~~ could have aan ~~material~~ adverse effect on our ~~business and~~ financial results.

To the extent newly adopted regulations negatively impact the business, operations or financial condition of our customers, our business and financial results could be adversely affected. We could be required to invest a significant amount of time and resources to comply with additional regulations or to modify the manner in which we provide products and services to our customers; and such regulations could limit how much we can charge for our services. We may not be able to update our existing products and services, or develop new ones at all or in a timely manner, to satisfy our customers’ needs. Any of these events, if realized, could have a material adverse effect on our business and financial results.

Catastrophic events may disrupt or otherwise adversely affect the markets in which we operate, our business and our profitability.

Our business may be adversely affected by a war, terrorist attack, natural disaster or other catastrophe. A catastrophic event could have a direct negative impact on us or an indirect impact on us by, for example, affecting our customers, the financial markets or the overall economy. The potential for a direct impact is due primarily to our significant investment in our infrastructure. Although we maintain redundant facilities and have contingency plans in place to protect against both man-made and natural threats, it is impossible to fully anticipate and protect against all potential catastrophes. Despite our preparations, a security breach, criminal act, military action, power or communication failure, flood, severe storm or the like could lead to service interruptions and data losses for customers, disruptions to our operations, or damage to our important facilities. The same disasters or circumstances that may lead to our customers requiring access to our availability services may negatively impact our own ability to provide such services. Our three largest availability services facilities are particularly important, and a major disruption at one or more of those facilities could disrupt or otherwise impair our ability to provide services to our availability services customers. If any of these events happen, we may be exposed to unexpected liability, our customers may leave, our reputation may be tarnished, and there could be a material adverse effect on our business and financial results.

Our application service provider systems may be subject to disruptions that could adversely affect our reputation and our business.

Our application service provider systems maintain and process confidential data on behalf of our customers, some of which is critical to their business operations. For example, our capital markets systems maintain account and trading information for our customers and their clients, and our wealth management and insurance systems maintain investor account information for retirement plans, insurance policies and mutual funds. There is no guarantee that the systems and procedures that we maintain to protect against unauthorized access to such information are adequate to protect against all security breaches. If our application service provider systems are disrupted or fail for any reason, or if our systems or facilities are infiltrated or damaged by unauthorized persons, our customers could experience data loss, financial loss, harm to reputation and significant business interruption. If that happens, we may be exposed to unexpected liability, our customers may leave, our reputation may be tarnished, and there could be a material adverse effect on our business and financial results.

Because the sales cycle for our software is typically lengthy and unpredictable, our results may fluctuate from period to period.

Our operating results may fluctuate from period to period and be difficult to predict in a particular period due to the timing and magnitude of software sales. We offer a number of our software solutions on a license basis, which means that the customer has the right to run the software on its own computers. The customer usually makes a significant up-front payment to license software, which we generally recognize as revenue when the license contract is signed and the software is delivered. The size of the up-front payment often depends on a number of factors that are different for each customer, such as the number of customer locations, users or

1211

~~such as the number of customer locations, users or~~ accounts. As a result, the sales cycle for a software license may be lengthy and take unexpected turns. Thus, it is difficult to predict when software sales will occur or how much revenue they will generate. Since there are few incremental costs associated with software sales, our operating results may fluctuate from quarter to quarter and year to year due to the timing and magnitude of software sales.

Rapid changes in technology and our customers’ businesses could adversely affect our business and financial results.

Our business may suffer if we do not successfully adapt our products and services to changes in technology and changes in our customers’ businesses. These changes can occur rapidly and at unpredictable intervals and we may not be able to respond adequately. If we do not successfully update and integrate our products and services to adapt to these changes, or if we do not successfully develop new products and services needed by our customers to keep pace with these changes, then our business and financial results may suffer. Our ability to keep up with technology and business changes is subject to a number of risks and we may find it difficult or costly to, among other things:

•

update our products and services and to develop new products fast enough to meet our customers’ needs;

•

make some features of our products and services work effectively and securely over the Internet;

•

integrate more of our FS solutions;

•

update our products and services to keep pace with business, regulatory and other developments in the financial services industry, where many of our customers operate; and

•

update our services to keep pace with advancements in hardware, software and telecommunications technology.

Some technological changes, such as advancements that have facilitated the ability of our AS customers to develop their own internal solutions, may render some of our products and services less valuable or eventually obsolete. In addition, because of ongoing, rapid technological changes, the useful lives of some technology assets have become shorter and customers are therefore replacing these assets more often. As a result, our customers are increasingly expressing a preference for contracts with shorter terms, which could make our revenue less predictable in the future.

Customers taking their information availability solutions in-house or leveraging inexpensive shared cloud-based solutions may create greater pressure on our organic revenue growth rate.

Our AS solutions allow customers to leverage our technology expertise and process-IP, resource management capabilities and substantial infrastructure investments. Technological advances in recent years have significantly reduced the cost and the complexity of developing in-house solutions. Some customers, especially among the very largest having significant IT resources, prefer to develop and maintain their own in-house availability solutions, which can result in a loss of revenue from those customers. If this trend continues or worsens, there will be continued pressure on our organic revenue growth rate. Also, cloud-based solutions are often perceived as inherently redundant and highly available. This is a misconception, as high availability is only provided when expressly engineered into a cloud environment. However, this belief along with the opportunity to leverage inexpensive cloud infrastructure for shared recovery options can, over time, become a more significant competitive threat especially in the area of availability solutions for less critical applications.

The trend toward information availability solutions utilizing more single customer dedicated resources likely will lower our overall operating margin rate over time.

In the information availability services industry, especially among our more sophisticated customers, there is preference for solutions that utilize some level of dedicated resources, such as blended advanced recovery services and managed services. The primary reason for this is that adding dedicated resources, although more costly, provides greater control, increases security, reduces data loss and facilitates quicker responses to business interruptions. Advanced recovery services often result in greater use of dedicated resources with a modest decrease in operating margin rate. Managed services require significant dedicated resources and, therefore, have an appropriately lower operating margin rate.

~~Our~~12 ~~brokerage operations are highly regulated and are riskier than our other businesses.~~

Organizations like the SEC, the Financial Services Authority and the Financial Industry Regulatory Authority can, among other things, fine, censure, issue cease-and-desist orders and suspend or expel a broker/dealer or any of its officers or employees for failures to comply with the many laws and regulations that govern brokerage activities. Such sanctions may arise out of currently-conducted activities or those conducted in prior periods. Our ability to comply with these laws and regulations is largely dependent on our establishment, maintenance and enforcement of an effective brokerage compliance program. Our failure to establish, maintain and enforce proper brokerage compliance procedures, even if unintentional, could subject us to significant losses, lead to disciplinary or other actions, and tarnish our reputation. Regulations affecting the brokerage industry may change, which could adversely affect our financial results.

We are exposed to certain risks relating to the execution and clearance services provided by our brokerage operations to customers and counterparties (including other broker/dealers), active traders, hedge funds, and other institutional and noninstitutional clients. These risks include, but are not limited to, customers failing to pay for securities commitments in the marketplace, trading errors, the inability or failure to settle trades, and trade execution or clearance systems failures. In our other businesses, we generally can disclaim liability for trading losses that may be caused by our software, but in our brokerage operations, we may not be able to limit our liability for trading losses even when we are not at fault. As a result we may suffer losses that are disproportionate to the relatively modest profit contributions of this business.

If we fail to comply with government regulations in connection with our business or providing technology services to certain financial institutions, our business and results of operations may be adversely affected.

Because we act as a third-party service provider to financial institutions and provide mission-critical applications for many financial institutions that are regulated by one or more member agencies of the Federal Financial Institutions Examination Council (“FFIEC”), we are subject to examination by the member agencies of the FFIEC. More specifically, we are a Multi-Regional Data Processing Servicer of the FFIEC because we provide mission critical applications for financial institutions from several data centers located in different geographic regions. As a result, the FFIEC conducts periodic reviews of certain of our operations in order to identify existing or potential risks associated with our operations that could adversely affect the financial institutions to whom we provide services, evaluate our risk management systems and controls, and determine our compliance with applicable laws that affect the services we provide to financial institutions. In addition to examining areas such as our management of technology, data integrity, information confidentiality and service availability, the

~~reviews~~services ~~also~~and ~~assess~~managed ~~our financial stability~~services. ~~Our~~The ~~incurrence~~primary ofreason ~~significant~~for ~~debt~~this inis ~~connection~~that ~~with~~adding ~~the~~dedicated ~~LBO~~resources, ~~increases~~although ~~the~~more ~~risk~~costly, ofprovides angreater ~~FFIEC~~control, ~~agency~~increases ~~review~~security, ~~determining~~reduces ~~that~~data ~~our~~loss ~~financial stability~~and ~~has~~facilitates ~~been~~quicker ~~weakened.~~responses Ato ~~sufficiently~~business ~~unfavorable~~interruptions. ~~review~~Advanced ~~from~~recovery ~~the~~services ~~FFIEC~~often ~~could~~ result in ~~our~~greater ~~financial~~use ~~institution~~of ~~customers~~dedicated ~~not~~resources ~~being~~with ~~allowed~~a tomodest ~~use~~decrease ~~our~~in ~~technology~~operating margin rate. Managed services, ~~which~~require ~~could~~significant ~~have~~dedicated aresources ~~material~~and, therefore, ~~adverse~~have ~~effect~~an onappropriately ~~our~~lower ~~business~~operating ~~and~~margin ~~financial condition~~rate.

Our securities brokerage operations are highly regulated and are riskier than our other businesses.

Domestic and foreign regulatory and self-regulatory organizations, such as the SEC, the Financial Industry Regulatory Authority, and the (U.K.) Financial Services Authority can, among other things, fine, censure, issue cease-and-desist orders against, and suspend or expel a broker-dealer or its officers or employees for failure to comply with the many laws and regulations that govern brokerage activities. Such sanctions may arise out of currently-conducted activities or those conducted in prior periods. Our ability to comply with these laws and regulations is largely dependent on our establishment, maintenance, and enforcement of an effective brokerage compliance program. Failure to establish, maintain, and enforce proper brokerage compliance procedures, even if unintentional, could subject us to significant losses, lead to disciplinary or other actions, and tarnish our reputation. Regulations affecting the brokerage industry may change, which could adversely affect our financial results.

We are exposed to certain risks relating to the execution services provided by our brokerage operations to our customers and counterparties, which include other broker-dealers, active traders, hedge funds, asset managers, and other institutional and non-institutional clients. These risks include, but are not limited to, customers or counterparties failing to pay for or deliver securities, trading errors, the inability or failure to settle trades, and trade execution system failures. In our other businesses, we generally can disclaim liability for trading losses that may be caused by our software, but in our brokerage operations, we may not be able to limit our liability for trading losses or failed trades even when we are not at fault. As a result, we may suffer losses that are disproportionately large compared to the relatively modest profit contributions of our brokerage operations.

If we fail to comply with any regulations applicable to our business, we may be exposed to unexpected liability and/or governmental proceedings, our customers may leave, our reputation may be tarnished, and there could be a material adverse effect on our business and financial results. In addition, the future enactment of more restrictive laws or rules on the federal or state level, or, with respect to our international operations, in foreign jurisdictions on the national, provincial, state or other level, could have an adverse impact on business and financial results.

If we are unable to retain or attract customers, our business and financial results will be adversely affected.

If we are unable to keep existing customers satisfied, sell additional products and services to existing customers or attract new customers, then our business and financial results may suffer. A variety of factors could affect our ability to successfully retain and attract customers, including the level of demand for our products and services, the level of customer spending for information technology, the level of competition from customers that develop their own solutions internally and from other vendors, the quality of our customer service, our ability to update our products and develop new products and services needed by customers, and our ability to integrate and manage acquired businesses. Further, the markets in which we operate are highly competitive and we may not be able to compete effectively. Our services revenue, which has been largely recurring in nature, comes from the sale of our products and services under fixed-term contracts. We do not have a unilateral right to extend these contracts when they expire. Revenue from our broker/dealer businesses is not subject to minimum or ongoing contractual commitments on the part of brokerage customers. If customers cancel or refuse to renew their contracts, or if customers reduce the usage levels or asset values under their contracts, there could be a material adverse effect on our business and financial results.

If we fail to retain key employees, our business may be harmed.

Our success depends on the skill, experience and dedication of our employees. If we are unable to retain and attract sufficiently experienced and capable personnel, especially in product development, sales and management, our business and financial results may suffer. For example, if we are unable to retain and attract a sufficient number of skilled technical personnel, our ability to develop high quality products and provide high quality customer service may be impaired. Experienced and capable personnel in the technology industry remain in high demand, and there is continual competition for their talents. When talented employees leave, we may have difficulty replacing them, and our business may suffer. There can be no assurance that we will be able to successfully retain and attract the personnel that we need.

We are subject to the risks of doing business internationally.

A portion of our revenue is generated outside the United States, primarily from customers located in Europe. Over the past few years we have expanded our operations in ~~India~~certain ~~and~~emerging ~~acquired~~markets ~~businesses~~ in Asia, ~~China~~Africa, ~~and~~Europe, ~~Singapore~~the inMiddle anEast ~~effort~~and toSouth ~~increase our presence throughout Asia Pacific~~America. Because we sell our services outside the United States, our business is subject to risks associated with doing business internationally. Accordingly, our business and financial results could be adversely affected due to a variety of factors, including:

internationally. Accordingly, our business and financial results could be adversely affected due to a variety of factors, including:

•

changes in a specific country’s or region’s political and cultural climate or economic condition;

•

unexpected or unfavorable changes in foreign laws and regulatory requirements;

•

difficulty of effective enforcement of contractual provisions in local jurisdictions;

•

inadequate intellectual property protection in foreign countries;

•

trade-protection measures, import or export licensing requirements such as Export Administration Regulations promulgated by the U.S. Department of Commerce and fines, penalties or suspension or revocation of export privileges;

• the effects of applicable ~~foreign tax law~~ and potentially adverse foreign tax law changes;

•

significant adverse changes in foreign currency exchange rates;

•

longer accounts receivable cycles;

•

managing a geographically dispersed workforce; and

•

difficulties associated with repatriating cash in a tax-efficient manner.

In14 foreign countries, particularly in those with developing economies, certain business practices may exist that are prohibited by laws and regulations applicable to us, such as the U.S. Foreign Corrupt Practices Act. Although our policies and procedures require compliance with these laws and are designed to facilitate compliance with these laws, our employees, contractors and agents may take actions in violation of applicable laws or our policies. Any such violation, even if prohibited by our policies, could have a material adverse effect on our business and reputation.

OurTable acquisition program is part of our strategy but, because of the uncertainties involved, this program may not be successful and we may not be able to successfully integrate and manage acquired businesses. Contents

~~Generally~~In foreign countries, weparticularly ~~seek~~in tothose ~~acquire~~with ~~businesses~~developing ~~that~~economies, ~~broaden~~certain ~~our~~business ~~existing~~practices ~~product~~may ~~lines~~exist ~~and~~that ~~service~~are ~~offerings~~prohibited by ~~adding~~laws ~~complementary products~~ and ~~service~~regulations ~~offerings~~applicable ~~and~~to byus, ~~expanding~~such ~~our~~as ~~geographic~~the ~~reach~~U.S. Foreign ~~There~~Corrupt ~~can~~Practices beAct ~~no assurance that our acquisition program will be successful or that we will be able to identify suitable acquisition candidates~~ and ~~successfully~~other ~~complete~~anti-corruption ~~acquisitions~~laws. InAlthough ~~addition,~~our wepolicies ~~may~~and ~~finance~~procedures ~~any~~require ~~future~~compliance ~~acquisition~~ with ~~debt,~~these ~~which~~laws ~~would increase our overall levels of indebtedness~~ and ~~related interest costs. If we~~ are designed ~~unable~~ to ~~successfully~~ ~~integrate~~facilitate ~~and~~compliance ~~manage~~with ~~acquired~~these ~~businesses~~laws, ~~then~~ our ~~business~~employees, contractors and ~~financial~~agents ~~results~~ may ~~suffer.~~take Itactions ~~is possible that the businesses we have acquired and businesses that we acquire~~ in ~~the~~violation ~~future~~of ~~may~~applicable ~~perform~~laws ~~worse than expected, be subject to an adverse litigation outcome~~ or ~~prove~~our topolicies. beAny ~~more~~such ~~difficult~~violation, toeven ~~integrate~~if ~~and~~prohibited ~~manage~~by ~~than~~our ~~expected. If that happens~~policies, ~~there~~could ~~may~~have be a material adverse effect on our business and ~~financial~~reputation. ~~results for a number of reasons, including:~~

Our acquisitions may not be successful and we may not be able to successfully integrate and manage acquired businesses.

Generally, we seek to acquire businesses that broaden our existing product lines and service offerings and expand our geographic reach. There can be no assurance that our acquisitions will be successful or that we will be able to identify suitable acquisition candidates and successfully complete acquisitions. In addition, we may finance any future acquisition with debt, which would increase our overall levels of indebtedness and related interest costs. If we are unable to successfully integrate and manage acquired businesses, then our business and financial results may suffer. It is possible that the businesses we have acquired and businesses that we acquire in the future may perform worse than expected, be subject to an adverse litigation outcome or prove to be more difficult to integrate and manage than expected. If that happens, there may be a material adverse effect on our business and financial results for a number of reasons, including:

•

we may have to devote unanticipated financial and management resources to acquired businesses;

•

we may not be able to realize expected operating efficiencies or product integration benefits from our acquisitions;

•

we may have to write off goodwill or other intangible assets; and

•

we may incur unforeseen obligations or liabilities (including assumed liabilities not fully indemnified by the seller) in connection with acquisitions.

We could lose revenue due to “fiscal funding” or “termination for convenience” clauses in certain customer contracts, especially in our K-12 and PS businesses.

Certain of our customer contracts, particularly those with governments and school districts, may be partly or completely terminated by the customer due to budget cuts or sometimes for any reason at all. These types of clauses are often called “fiscal funding” or “termination for convenience” clauses. If a customer exercises one of these clauses, the customer would be obligated to pay for the services we performed up to the date of exercise, but would not have to pay for any further services. In addition, governments and school districts may require contract terms that differ from our standard terms. While we have not been materially affected by exercises of these clauses or other unusual terms in the past, we may be in the future. If customers that collectively represent a substantial portion of our revenue were to invoke the fiscal funding or termination for convenience clauses of their contracts, our future business and results of operations could be adversely affected.

The private equity firms that acquired the Company (“Sponsors”) control us and may have conflicts of interest with us.

Investment funds associated with or designated by the Sponsors indirectly own, through their ownership in the Parent Companies, a substantial portion of our capital stock. As a result, the Sponsors have control over our decisions to enter into any corporate transaction regardless of whether noteholders believe that any such transaction is in their own best interests. For example, the Sponsors could cause us to make acquisitions or pay dividends that increase the amount of indebtedness that is secured or that is senior to our senior subordinated notes or to sell assets.

Additionally, the Sponsors are in the business of making investments in companies and may from time to time acquire and hold interests in businesses that compete directly or indirectly with us. One or more of the Sponsors may also pursue acquisition opportunities that may be complementary to our business and, as a result, those acquisition opportunities may not be available to us. So long as investment funds associated with or designated by the Sponsors continue to indirectly own a significant amount of the outstanding shares of our common stock, even if such amount is less than 50%, the Sponsors will continue to be able to strongly influence or effectively control our decisions.

Sponsors may also pursue acquisition opportunities that may be complementary to our business and, as a result, those acquisition opportunities may not be available to us. So long as investment funds associated with or designated by the Sponsors continue to indirectly own a significant amount of the outstanding shares of our common stock, even if such amount is less than 50%, the Sponsors will continue to be able to strongly influence or effectively control our decisions.

If we are unable to protect our proprietary technologies and defend infringement claims, we could lose one of our competitive advantages and our business could be adversely affected.

Our success depends in part on our ability to protect our proprietary products and services and to defend against infringement claims. If we are unable to do so, our business and financial results may suffer. To protect our proprietary technology, we rely upon a combination of copyright, patent, trademark and trade secret law, confidentiality restrictions in contracts with employees, customers and others, software security measures, and registered copyrights and patents. Despite our efforts to protect the proprietary technology, unauthorized persons may be able to copy, reverse engineer or otherwise use some of our technology. It also is possible that others will develop and market similar or better technology to compete with us. Furthermore, existing patent, copyright and trade secret laws may afford only limited protection, and the laws of certain countries do not protect proprietary technology as well as United States law. For these reasons, we may have difficulty protecting our proprietary technology against unauthorized copying or use. If any of these events happens, there could be a material adverse effect on the value of our proprietary technology and on our business and financial results. In addition, litigation may be necessary to protect our proprietary technology. This type of litigation is often costly and time-consuming, with no assurance of success.

We may be sued for violating the intellectual property rights of others.

The software industry is characterized by the existence of a large number of trade secrets, copyrights and the ~~rapid~~growing ~~issuance~~number of issued patents, as well as frequent litigation based on allegations of infringement or other violations of intellectual property rights. We may unknowingly violate the intellectual property rights of others. Some of our competitors or other third parties may have been more aggressive than us in applying for or obtaining patent ~~protection~~rights for innovative proprietary technologies both in the United States and internationally. In addition, we use a limited amount of open source software in our products and may use more open source software in the future. Because open source software is developed by numerous independent parties over whom we exercise no supervision or control, allegations of infringement for using open source software are possible. Although we monitor our use and our suppliers’ use of open source software to avoid subjecting our products to conditions we do not intend, the terms of many open source licenses have not been interpreted by United States or other courts, and there is a risk that these licenses could be construed in a manner that could impose unanticipated conditions or restrictions on our ability to commercialize our products.

As a result of all of these factors, there can be no assurance that in the future third parties will not assert infringement claims against us and preclude us from using a technology in our products or require us to enter into royalty and licensing arrangements on terms that are not favorable to us, or force us to engage in costly infringement litigation, which could result in us paying monetary damages or being forced to redesign our products to avoid infringement. Additionally, our licenses and service agreements with our customers generally provide that we will defend and indemnify them for claims against them relating to our alleged infringement of the intellectual property rights of third parties with respect to our products or services. We might have to defend or indemnify our customers to the extent they are subject to these types of claims. Any of these claims may be difficult and costly to defend and may lead to unfavorable judgments or settlements, which could have a material adverse effect on our reputation, business and financial results. For these reasons, we may find it difficult or costly to add or retain important features in our products and services.

At present, we are vigorously defending a number of patent infringement cases. While we do not believe we have a potential liability for damages or royalties from any known current legal proceedings or claims related to the infringement of patent or other intellectual property rights that would individually or in the aggregate materially adversely affect our financial condition and operating results, the results of such legal proceedings cannot be predicted with certainty. Should we fail to prevail in any of the matters related to infringement of patent or other intellectual property rights of others or should several of these matters be resolved against us in the same reporting period, it could have a material adverse effect on our business and financial results.

the infringement of patent or other intellectual property rights that would individually or in the aggregate materially adversely affect our financial condition and operating results, the results of such legal proceedings cannot be predicted with certainty. Should we fail to prevail in any of the matters related to infringement of patent or other intellectual property rights of others or should several of these matters be resolved against us in the same reporting period, it could have a material adverse effect on our business and financial results.

Defects, design errors or security flaws in our products could harm our reputation and expose us to potential liability.

Most of our products are very complex software systems that are regularly updated. No matter how careful the design and development, complex software often contains errors and defects when first introduced and when major new updates or enhancements are released. If errors or defects are discovered in our current or future products, we may not be able to correct them in a timely manner, if at all. In our development of updates and enhancements to our products, we may make a major design error that makes the product operate incorrectly or less efficiently.

In addition, certain of our products include security features that are intended to protect the privacy and integrity of customer data. Despite these security features, our products and systems, and our customers’ systems may be vulnerable to break-ins and similar problems caused by third parties, such as hackers bypassing firewalls and misappropriating confidential information. Such break-ins or other disruptions could jeopardize the security of information stored in and transmitted through our computer systems and those of our customers, subject us to liability and tarnish our reputation. We may need to expend significant capital resources in order to eliminate or work around errors, defects, design errors or security problems. Any one of these problems in our products may result in the loss of or a delay in market acceptance of our products, the diversion of development resources, a lower rate of license renewals or upgrades and damage to our reputation, and in turn may increase service and warranty costs.

We have concluded that our internal control over financial reporting was not effective as of December 31, 2011 as a result of our identification of a material weakness related to accounting for deferred income taxes. A material weakness in our internal controls could have a material adverse affect on us.

Effective internal controls are necessary for us to provide reasonable assurance with respect to our financial reports and to effectively prevent fraud. If we cannot provide reasonable assurance with respect to our financial reports and effectively prevent fraud, our reputation and operating results could be harmed. Internal control over financial reporting may not prevent or detect misstatements because of its inherent limitations, including the possibility of human error, the circumvention or overriding of controls, or fraud. Further, the complexities of our quarter- and year-end closing processes increase the risk that a weakness in internal ~~controls~~control over financial reporting may go undetected. Therefore, even effective internal controls can provide only reasonable assurance with respect to the preparation and fair presentation of financial statements. In addition, projections of any evaluation of effectiveness of internal control over financial reporting to future periods are subject to the risk that the control may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

InA ~~connection~~material ~~with~~weakness in our ~~assessment of~~ internal control over financial reporting ~~under~~could ~~Section 404 of the Sarbanes-Oxley Act of 2002~~adversely asimpact ofour ~~December 31,~~ability ~~2011, we identified a material weakness related~~ to ~~our~~provide ~~accounting~~timely ~~for~~and ~~deferred~~accurate ~~income~~financial ~~taxes~~information. ~~For~~If awe ~~discussion~~are ofunable ~~our~~to ~~internal~~report ~~control over~~ financial ~~reporting~~information timely and aaccurately ~~description~~or ofto ~~the~~maintain ~~identified~~effective ~~material~~disclosure ~~weakness,~~controls ~~see “Management’s~~and ~~Report~~procedures, onwe ~~Internal~~could ~~Control~~be ~~Over~~subject ~~Financial~~to, ~~Reporting”~~among ~~included~~other ~~in Item 9A of this Report. A material weakness is a deficiency~~things, regulatory or ~~combination~~enforcement ofactions ~~deficiencies,~~by inthe ~~internal control over financial reporting~~SEC, ~~such~~any ~~that there~~one ~~is a reasonable possibility that a material misstatement~~ of ~~the~~which ~~Company’s~~could ~~annual~~adversely oraffect ~~interim~~our ~~financial~~business ~~statements will not be prevented or detected on a timely basis~~prospects.

AIn ~~material~~connection with ~~weakness~~our inassessment ~~our~~of internal control over financial reporting ~~could~~under ~~adversely~~Section 404 ~~impact~~of ~~our~~the ~~ability~~Sarbanes-Oxley toAct ~~provide~~of ~~timely~~2002 ~~and~~as ~~accurate financial~~of ~~information.~~December 31, We2011, ~~plan~~we toidentified ~~implement~~ a ~~number~~material ofweakness ~~remediation~~related ~~steps~~ to ~~address~~our ~~the~~accounting ~~material~~for deferred income taxes. A material weakness asis ~~described~~a indeficiency, ~~Item~~or 9Acombination of ~~this~~deficiencies, ~~Report.~~in Ifinternal wecontrol ~~are~~over ~~unsuccessful~~financial inreporting, ~~implementing~~such orthat ~~following~~there ~~our~~is ~~remediation~~a ~~plan,~~reasonable wepossibility ~~may~~that ~~not~~a bematerial ~~able~~misstatement toof ~~timely or~~the ~~accurately~~Company’s ~~report~~annual ~~our~~or interim financial ~~condition,~~statements ~~results~~will ofnot ~~operations~~be prevented or ~~cash~~detected ~~flows~~on ora ~~maintain~~timely ~~effective~~basis. ~~disclosure~~To ~~controls~~remediate ~~and~~the ~~procedures.~~material Ifweakness, we ~~are~~developed ~~unable~~and toimplemented ~~report~~a ~~financial~~remediation ~~information~~plan. ~~timely~~As ~~and~~a ~~accurately~~result orof tothe ~~maintain~~remedial ~~effective~~actions ~~disclosure controls and procedures~~completed, weas ~~could~~described bein ~~subject~~Item 9A ~~to,~~of ~~among~~this ~~other things~~Report, ~~regulatory~~we orhave ~~enforcement~~concluded ~~actions~~that bywe have remediated the ~~SEC,~~material ~~any~~weakness ~~one~~in ofaccounting ~~which~~for ~~could~~deferred ~~adversely~~income ~~affect~~taxes ~~our~~as ~~business~~of ~~prospects~~December 31, 2012.

1917

Unanticipated changes in our income tax provision or the ~~adoption~~enactment of new tax legislation, issuance of regulations or relevant judicial decisions could affect our profitability or cash flow.

We are subject to income taxes in the United States and many foreign jurisdictions. Significant judgment is required in determining our worldwide provision for income taxes. We regularly are under ~~audit~~examination by tax authorities. Although we believe our income tax provision is reasonable, the final determination of our tax liability could be materially different from our historical income tax provisions, which could have a material effect on our financial position, results of operations or cash flows. In addition, tax-law amendments in the U.S. and other jurisdictions could significantly impact how U.S. multinational corporations are taxed. Although we cannot predict whether or in what form such legislation will pass, if enacted it could have a material adverse effect on our business and financial results.

ITEM 1B.

UNRESOLVED STAFF COMMENTS

None.

ITEM 2.

PROPERTIES

We lease space, primarily for availability services facilities, data centers, sales offices, customer support offices and administrative offices, in many locations worldwide. We also own some of our computer and office facilities. Our principal facilities include our leased Availability Services facilities in Philadelphia, Pennsylvania (~~629~~592,~~800~~000 square feet), Carlstadt, New Jersey (661,000 square feet), and Hounslow, England (195,000 square feet) and include our financial systems application service provider centers in Voorhees, New Jersey; ~~Birmingham, Alabama;~~ Burlington, Massachusetts; Hopkins, Minnesota; Salem, New Hampshire; Ridgefield, New Jersey; and Wayne, Pennsylvania. We believe that our leased and owned facilities are adequate for our present operations.

ITEM 3.

LEGAL PROCEEDINGS

We are presently a party to certain lawsuits arising in the ordinary course of our business. We believe that none of our current legal proceedings will be material to our business, financial condition or results of operations. Information with respect to this item may be found in Note 15 of the Notes to Consolidated Financial Statements in this Report, which information is incorporated into this Item 3 by reference.

ITEM 4.

MINE SAFETY DISCLOSURES

Not applicable.

PART II

ITEM 5.

MARKET FOR REGISTRANTS’ COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Our outstanding common stock is privately held, and there is no established public trading market for our common stock. As of March 1, ~~2012~~2013, there were 376 holders of record of each of Class A common stock and Class L common stock of SCC, and there was one holder of record of common stock of SunGard.

See ITEM 7-LIQUIDITY AND CAPITAL RESOURCES—COVENANT COMPLIANCE for a description of restrictions on our ability to pay dividends.

20ITEM 6. SELECTED FINANCIAL DATA

Item 6. SELECTED FINANCIAL DATA

SunGard Capital Corp.

(in millions)	2007			2008			2009			2010			2011
	2008			2009			2010			2011			2012
	(in millions)
Income Statement Data (1)
Revenue	$	4,~~154~~795		$	4,~~861~~752		$	4,~~806~~437		$	4,~~490~~440		$	4,~~499~~263
Operating income (loss)		~~522~~537			~~534~~(684	)		~~(686~~204	)		~~205~~337			~~333~~74
Net loss from continuing operations		(121	)		(146	)		(1,184	)		(414	)		(75	)
Loss from continuing operations		(142	)		(1,181	)		(414	)		(71	)		(397	)
Net income (loss) from discontinued operations		61			(96	)		67			(156	)		(76	)
Income (loss) from discontinued operations		(100	)		64			(156	)		(80	)		331
Net loss		(60242	)		(~~242~~1,117	)		(~~1,117~~570	)		(~~570~~151	)		(~~151~~66	)
Cash Flow Data
Cash flow from operations	$	689		$	384		$	640		$	721		$	678
Cash flow from continuing operations		N/A	(2)		N/A	(2)	$	601		$	606		$	645
Cash flow from discontinued operations		N/A	(2)		N/A	(2)		120			72			(401	)
Cash flow from operations	$	384		$	640		$	721		$	678		$	244
Balance Sheet Data
Total assets	$	1415,~~842~~778		$	1513,~~778~~980		$	1312,~~980~~968		$	12,~~968~~550		$	1210,~~550~~018
Total short-term and long-term debt		78,~~485~~875			8,~~875~~315			8,~~315~~055			87,~~055~~829			76,~~829~~662
Equity		32,~~384~~869			21,~~869~~914			1,~~914~~452			1,~~452~~375			~~1,375~~614

SunGard Capital Corp. II

(in millions)	2007			2008			2009			2010			2011
	2008			2009			2010			2011			2012
	(in millions)
Income Statement Data (1)
Revenue	$	4,~~154~~795		$	4,~~861~~752		$	4,~~806~~437		$	4,~~490~~440		$	4,~~499~~263
Operating income (loss)		~~523~~537			~~534~~(684	)		~~(686~~204	)		~~205~~337			~~333~~74
Net loss from continuing operations		(121	)		(146	)		(1,185	)		(414	)		(75	)
Loss from continuing operations		(142	)		(1,182	)		(414	)		(69	)		(397	)
Net income (loss) from discontinued operations		61			(96	)		67			(156	)		(76	)
Income (loss) from discontinued operations		(100	)		64			(156	)		(80	)		331
Net loss		(60242	)		(~~242~~1,118	)		(~~1,118~~570	)		(~~570~~149	)		(~~151~~66	)
Cash Flow Data
Cash flow from operations	$	701		$	385		$	640		$	721		$	678
Cash flow from continuing operations		N/A	(2)		N/A	(2)	$	601		$	606		$	645
Cash flow from discontinued operations		N/A	(2)		N/A	(2)		120			72			(401	)
Cash flow from operations	$	385		$	640		$	721		$	678		$	244
Balance Sheet Data
Total assets	$	1415,~~840~~778		$	1513,~~778~~980		$	1312,~~980~~968		$	12,~~968~~550		$	1210,~~550~~018
Total short-term and long-term debt		78,~~485~~875			8,~~875~~315			8,~~315~~055			87,~~055~~829			76,~~829~~662
Stockholders’ equity		3,~~505~~011			32,~~011~~026			21,~~026~~567			1,~~567~~433			~~1,433~~688

SunGard Data Systems Inc.

(in millions)	2007			2008			2009			2010			2011
	2008			2009			2010			2011			2012
	(in millions)
Income Statement Data (1)
Revenue	$	4,~~154~~795		$	4,~~861~~752		$	4,~~806~~437		$	4,~~490~~440		$	4,~~499~~263
Operating income (loss)		~~523~~537			~~534~~(684	)		~~(686~~204	)		~~205~~337			~~333~~74
Net loss from continuing operations		(121	)		(146	)		(1,185	)		(414	)		(73	)
Loss from continuing operations		(142	)		(1,182	)		(414	)		(69	)		(397	)
Net income (loss) from discontinued operations		61			(96	)		67			(156	)		(76	)
Income (loss) from discontinued operations		(100	)		64			(156	)		(80	)		331
Net loss		(60242	)		(~~242~~1,118	)		(~~1,118~~570	)		(~~570~~149	)		(~~149~~66	)
Cash Flow Data
Cash flow from operations	$	701		$	385		$	639		$	721		$	678
Cash flow from continuing operations		N/A	(2)		N/A	(2)	$	601		$	606		$	645
Cash flow from discontinued operations		N/A	(2)		N/A	(2)		120			72			(401	)
Cash flow from operations	$	385		$	639		$	721		$	678		$	244
Balance Sheet Data
Total assets	$	1415,~~840~~778		$	1513,~~778~~980		$	1312,~~980~~968		$	12,~~968~~550		$	1210,~~550~~018
Total short-term and long-term debt		78,~~485~~875			8,~~875~~315			8,~~315~~055			87,~~055~~829			76,~~829~~662
Stockholder’s equity		3,~~556~~063			32,~~063~~067			21,~~067~~607			1,~~607~~461			~~1,461~~716

21(1) Included in the 2008 loss from continuing operations are intangible asset write-offs of $67 million and foreign currency losses and unused alternative financing commitment fees associated with the acquisition of GL TRADE S.A. of $17 million. Included in the 2008 income from discontinued operations is a goodwill impairment charge of $128 million.

Included in the 2009 loss from continuing operations is a goodwill impairment charge of $1.13 billion and intangible asset write-offs of $35 million.

Included in the 2010 loss from continuing operations is a goodwill impairment charge of $205 million and a loss on the extinguishment of debt of $58 million, including tender and call premiums of $39 million, associated with the early retirement of $1.6 billion senior notes due 2013 and euro denominated term loans. Included in the 2010 loss from discontinued operations is a goodwill impairment charge of $123 million and a loss on disposal of discontinued operations of $94 million.

Included in the 2011 loss from continuing operations are goodwill impairment charges of $48 million related to prior-year periods which have been corrected in 2011 and an income tax benefit of $48 million reflecting amortization of the deferred tax liability which benefit would have been reflected in prior years in the statement of comprehensive income. Included in the 2011 income (loss) from discontinued operations is $135 million of deferred tax expense related to the book-over-tax basis difference of a Higher Education (“HE”) subsidiary that is classified as held for sale at December 31, 2011 and a goodwill impairment charge of $3 million.

Included in the 2012 loss from continuing operations is a goodwill impairment charge of $385 million and a loss on extinguishment of debt of $82 million, including tender and call premiums of $48 million, due primarily to the early extinguishments of the senior notes due 2015 and the senior subordinated notes due 2015, and the partial repayment of term loans in January and December 2012. Included in the 2012 income from discontinued operations are gains on the sale of discontinued operations of $571 million.

See Notes 1, 2, 5 and 6 of Notes to Consolidated Financial Statements.

(2)	The split of cash flow from continuing operations and cash flow from discontinued operations is not available for 2008 and 2009 due to the sales of HE in 2011 and SunGard Global Services France in 2012.

(1) Included in 2007 loss from continuing operations is $28 million of expense associated with the early retirement of $400 million of senior floating rate notes due 2013, of which $19 million represented the retirement premium paid to noteholders.

Included in 2008 loss from continuing operations are intangible asset write-offs of $67 million and foreign currency losses and unused alternative financing commitment fees associated with the acquisition of GL TRADE S.A. of $17 million. Included in 2008 income from discontinued operations is a goodwill impairment charge of $128 million.

Included in 2009 loss from continuing operations is a goodwill impairment charge of $1.13 billion and intangible asset write-offs of $35 million.

Included in 2010 loss from continuing operations are goodwill impairment charges of $205 million and $58 million of expense, including tender and call premiums of $39 million, associated with the early retirement of $1.6 billion senior notes due 2013 and euro denominated term loans. Included in 2010 loss from discontinued operations are goodwill impairment charges of $123 million and a loss on disposal of discontinued operations of $94 million.

Included in 2011 loss from continuing operations are goodwill impairment charges of $48 million that are related to prior year periods but have been corrected in 2011 and an income tax benefit of $48 million reflecting the amortization of the deferred tax liability which benefit would have been reflected in the statement of comprehensive income had the 2009 adjustment not been made. Included in 2011 income (loss) from discontinued operations is $135 million of deferred tax expense related to the book-over-tax basis difference of a HE subsidiary that is classified as held for sale at December 31, 2011 and a goodwill impairment charge of $3 million.

See Notes 1, 2 and 6 of Notes to Consolidated Financial Statements.

Item 7.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Overview

We operate our business in three segments: Financial Systems (“FS”), Availability Services (“AS”) and Other, which is comprised of K-12 Education ~~(“K-12”)~~ and Public Sector (“PS”). Our FS segment primarily serves financial services companies, corporate and government treasury departments and energy companies. Our AS segment serves IT-dependent companies across virtually all industries. Our Other segment, which is approximately 5% of our total revenue, primarily serves state and local governments, ~~nonprofit~~not-for-profit organizations and K-12 school districts and private schools throughout the U.S.

SunGard Data Systems Inc. (“SunGard”) was acquired on August 11, 2005 in a leveraged buy-out by a consortium of private equity investment funds associated with Bain Capital Partners, The Blackstone Group, Goldman Sachs & Co., Kohlberg Kravis Roberts & Co., Providence Equity Partners, Silver Lake and TPG (the “LBO”).

SunGard is a wholly owned subsidiary of SunGard Holdco LLC, which is wholly owned by SunGard Holding Corp., which is wholly owned by SunGard Capital Corp. II (“SCCII”), which is a subsidiary of SunGard Capital Corp (“SCC”). SCCII and SCC are collectively referred to as the “Parent Companies.” All four of these companies were formed for the purpose of facilitating the LBO and are collectively referred to as the “Holding Companies.” The use of “we”, “our”, “us” and similar terms is meant to refer to each of SCC, SCCII and SunGard.

AS provides disaster recovery services, managed IT services, information availability consulting services and business continuity management software to ~~over~~more 9than 8,000 customers in North America and Europe. With approximately five million square feet of data center and operations space, AS assists IT organizations across virtually all industry and government sectors to prepare for and recover from emergencies by helping them minimize their computer downtime and optimize their uptime. Through direct sales and channel partners, AS helps organizations ~~ensure their people and customers~~ have uninterrupted access to the information systems ~~they~~so ~~need~~that inthey can ~~order~~continue to dotransact business.

Our Other segment provides software and technology services designed to meet the specialized needs of local, state and federal governments, public safety and justice agencies, public and private schools, utilities, nonprofits, and other public sector institutions.

23In 2012, the difficult economy resulted in cautious customer buying patterns, particularly in the established markets. In FS, this has resulted in fewer new license sales, which in turn drove lower professional services revenue. Offsetting this, processing revenues were fairly stable and license renewals were strong. In addition, in certain product lines, particularly within the emerging markets, we have consistently acquired new customers

~~SunGard’s results of operations typically trail current economic activity, largely due~~ towhich ~~the~~in ~~multi-year~~turn ~~contracts~~resulted ~~that~~in ~~generate~~additional ~~the~~professional ~~majority~~services ~~of our~~ revenue. WeIn ~~participate in the financial services and public sector industries and~~AS, in our ~~availability~~managed ~~services~~recovery ~~business~~program, ~~across~~managed aservice ~~broad cross-section of the economy. Each of these sectors~~offerings, ~~to varying degrees, has experienced some disruption. The results in 2010~~ and ~~2011~~cloud ~~reflect~~solutions ~~the~~helped ~~impact~~to ofoffset ~~these~~a ~~challenging~~contraction ~~economic conditions. In response, we are focused on right-sizing our expense base~~ in ~~line with expected revenue~~ ~~opportunities~~traditional ~~but~~recovery ~~have~~services ~~continued to invest in capital spending, product development and to opportunistically acquire technology through acquisitions~~revenue.

~~The~~In ~~following~~this ~~discussion reflects the results of operations and financial condition of SCC~~environment, ~~which~~we are ~~materially~~managing ~~the~~carefully ~~same~~to asprotect ~~the~~our ~~results~~profit ~~of operations~~ and ~~financial~~improve ~~condition~~our profit ~~of SCCII and SunGard~~margins. ~~Therefore,~~ ~~the~~We ~~discussions~~are ~~provided~~specifically ~~are~~taking ~~applicable~~steps to ~~each~~exit oflower ~~SCC,~~margin ~~SCCII~~or ~~and~~slower ~~SunGard~~growing ~~unless~~business ~~otherwise noted~~lines. ~~Also,~~We ~~the~~are ~~following~~thoughtfully ~~discussion~~managing ~~includes~~spending ~~historical~~ and ~~certain~~shifting ~~forward-looking~~our ~~information~~investments ~~that~~into ~~should~~faster begrowing ~~read~~products ~~together with the accompanying Consolidated Financial Statements~~ and ~~related~~regions. ~~footnotes~~This ~~and~~has ~~the~~resulted ~~discussion~~in ~~above~~improved ofcash flow, ~~certain~~reduced ~~risks~~debt and ~~uncertainties~~greater ~~(see~~value ~~ITEM 1A—RISK FACTORS) that could cause future operating results~~ to ~~differ~~our ~~materially from historical results or the expected results indicated by forward-looking statements~~shareholders.

Use of Estimates and Critical Accounting Policies

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires us to make many estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses. Those estimates and judgments are based on historical experience, future expectations and other factors and assumptions we believe to be reasonable under the circumstances. We review our estimates and judgments on an ongoing basis and revise them when necessary. Actual results may differ from the original or revised estimates. A summary of our significant accounting policies is contained in Note 1 of Notes to Consolidated Financial Statements. A description of the most critical policies and those areas where estimates have a relatively greater effect in the financial statements follows. Management ~~Our management~~ has discussed the critical accounting policies described below with our audit committee.

Intangible Assets and Purchase Accounting

Purchase accounting requires that all assets and liabilities be recorded at fair value on the acquisition date, including identifiable intangible assets separate from goodwill. Identifiable intangible assets include customer base (which includes customer contracts and relationships), software and trade name. Goodwill represents the excess of cost over the fair value of net assets acquired.

The estimated fair values and useful lives of identifiable intangible assets are based on on many factors, including estimates and assumptions of future operating performance and cash flows of the acquired business, the nature of the business acquired, the specific characteristics of the identified intangible assets, and our historical experience and that of the acquired business. The estimates and assumptions used to determine the fair values and useful lives of identified intangible assets could change due to numerous factors, including product demand, market conditions, technological developments, economic conditions and competition. In connection with our determination of fair values ~~for the LBO and for other significant acquisitions~~, we may engage independent appraisal firms to assist us with the valuation of intangible (and certain tangible) assets acquired and certain assumed obligations.

24We periodically review carrying values and useful lives of long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. Factors that could indicate an impairment include significant underperformance of the asset as compared to historical or projected future operating results, or significant negative industry or economic trends. When we determine that the carrying value of an asset may not be recoverable, the related estimated future undiscounted cash flows expected to result from the use and eventual disposition of the asset are compared to the carrying value of the asset. If the sum of the estimated future undiscounted cash flows is less than the carrying amount, we record an impairment charge based on the difference between the carrying value of the asset and its fair value, which we estimate based on discounted expected future cash flows. In determining whether an asset is impaired, we make assumptions regarding recoverability of costs, estimated future cash flows from the asset, intended use of the asset and other relevant factors. If these estimates or their related assumptions change, we may be required to record non-cash impairment charges for these assets.

GAAP requires the Company to perform a goodwill impairment test annually and test more frequently when negative conditions or a triggering event arise. In September 2011, the Financial Accounting Standards Board

~~We periodically review carrying values and useful lives of long-lived assets for impairment~~ ~~whenever~~(“FASB”) ~~events~~issued oramended ~~changes~~guidance ~~in circumstances indicate~~ that ~~the~~simplified ~~carrying~~how ~~value~~entities oftest ~~the~~goodwill ~~asset~~for ~~may not be recoverable~~impairment. ~~Factors~~After ~~that could indicate~~ an ~~impairment~~assessment ~~include significant underperformance~~ of ~~the~~certain ~~asset~~qualitative ~~as compared to historical or projected future operating results~~factors, orif ~~significant~~it ~~negative~~is ~~industry~~determined orto ~~economic trends. When we determine that the carrying value of an asset may not~~ be ~~recoverable,~~more ~~the related estimated future undiscounted cash flows expected to result from the use and~~likely ~~eventual~~than ~~disposition~~not ofthat the ~~asset~~fair ~~are compared to the carrying~~ value of ~~the~~a ~~asset.~~reporting Ifunit ~~the sum of the estimated future undiscounted cash flows~~ is less than ~~the~~its carrying amount, weentities ~~record~~must anperform ~~impairment charge based on~~ the ~~difference~~quantitative ~~between~~analysis ~~the carrying value~~ of the ~~asset~~goodwill ~~and~~impairment ~~its~~test. ~~fair value~~Otherwise, ~~which~~the wequantitative ~~estimate~~test(s) ~~based~~become ~~on discounted expected future cash flows~~optional. InAs ~~determining~~allowed ~~whether~~under anthe ~~asset is impaired~~amended guidance, wethe ~~make~~Company ~~assumptions~~chose ~~regarding~~not ~~recoverability~~to ofassess ~~costs, estimated future cash flows from~~ the ~~asset,~~qualitative ~~intended~~factors ~~use~~ of ~~the~~its ~~asset~~reporting units and, ~~other relevant factors. If these estimates or their related assumptions change~~instead, weperformed ~~may~~the bequantitative ~~required to record impairment charges for these assets~~test.

We ~~are required to perform a goodwill impairment test, a two-step test, annually and more frequently when negative conditions or a triggering event arise. We~~ complete our annual goodwill impairment test as of July 1 for each of our 1311 reporting units. In step one, ~~the~~we ~~estimated fair value of each reporting unit is compared to its carrying value. We~~ estimate the fair values of each reporting unit by a combination of (i) estimation of the discounted cash flows of each of the reporting units based on projected earnings in the future (the income approach) and (ii) a comparative analysis of revenue and EBITDA multiples of public companies in similar markets (the market approach). We then compare the estimated fair value to the carrying value. If there is a deficiency (the estimated fair value of a reporting unit is less than the carrying value), a step -two test is required. In step two, the amount of any goodwill impairment is measured by comparing the implied fair value of the reporting unit’s goodwill to the carrying value of goodwill, with any resulting impairment reflected in operations. The implied fair value is determined in the same manner as the amount of goodwill recognized in a business combination.

InEstimating ~~September~~the ~~2011~~fair value of a reporting unit requires various assumptions including projections of future cash flows, ~~the~~perpetual ~~FASB~~growth ~~issued~~rates ~~amended~~and ~~guidance~~discount rates that ~~will simplify~~reflect ~~how~~the ~~entities~~risks ~~test~~associated ~~goodwill~~with ~~for~~achieving ~~impairment~~those cash flows. ~~After~~The assumptions about future cash flows and growth rates are based on management’s assessment of ~~certain~~a ~~qualitative~~number of factors, ifincluding itthe isreporting ~~determined~~unit’s torecent beperformance, ~~more~~performance ~~likely~~of ~~than~~the ~~not~~market that the ~~fair~~reporting ~~value~~unit ofserves, aas ~~reporting~~well ~~unit~~as isindustry ~~less~~and ~~than~~general ~~its~~economic ~~carrying~~data ~~amount,~~from ~~entities~~third ~~must~~party ~~perform~~sources. ~~the~~Discount ~~quantitative~~rate ~~analysis~~assumptions are based on an assessment of the ~~goodwill~~risk ~~impairment~~inherent ~~test~~in those future cash flows. ~~Otherwise,~~Changes to the ~~quantitative~~underlying ~~test(s)~~businesses ~~become~~could ~~optional.~~affect ~~The~~the ~~guidance~~future iscash ~~effective~~flows, ~~January~~which in turn could affect the fair value of the reporting unit. For the July 1, 2012 ~~with~~impairment ~~early~~test, ~~adoption~~the ~~permitted.~~discount ~~The~~rates ~~Company~~used ~~will~~were ~~adopt~~between ~~this~~10% ~~guidance~~and ~~for~~12% ~~our~~and ~~2012~~the ~~goodwill impairment~~perpetual ~~test~~growth rates used were between 3% and 4%.

~~Estimating~~Based on the ~~fair~~results ~~value~~ of athe ~~reporting~~step-one ~~unit requires various assumptions including projections of future cash flows~~tests, ~~perpetual~~we ~~growth~~determined ~~rates and discount rates~~ that ~~reflect~~ the ~~risks~~carrying ~~associated~~value ~~with~~of ~~achieving~~our ~~those~~Availability ~~cash~~Services ~~flows.~~North ~~The~~America ~~assumptions~~(“AS ~~about~~NA”) ~~future~~reporting ~~cash~~unit ~~flows~~was ~~and~~in ~~growth~~excess ~~rates are based on management’s assessment~~ of aits ~~number~~respective offair ~~factors~~value ~~including~~and ~~the~~a ~~reporting~~step-two ~~unit’s~~test ~~recent~~was ~~performance~~required. ~~against~~The ~~budget,~~primary ~~performance~~driver infor the ~~market~~decline ~~that~~in the ~~reporting~~fair ~~unit~~value ~~serves, as well as industry and general economic data from third party sources. Discount rate assumptions are based on an assessment~~ of the ~~risk~~AS ~~inherent~~NA inreporting ~~those~~unit ~~future~~compared ~~cash flows. Changes~~ to the ~~underlying~~prior ~~businesses~~year ~~could~~is ~~affect~~ the ~~future~~decline ~~cash flows, which~~ in ~~turn~~the ~~could~~cash ~~affect~~flow ~~the~~projections ~~fair~~for ~~value~~AS ofNA ~~the~~when ~~reporting~~compared ~~unit.~~to ~~For~~those ~~our~~used ~~most~~in ~~recent~~the ~~annual~~2011 goodwill impairment test as ~~of July 1,~~a ~~2011,~~result ~~the~~of ~~discount~~a ~~rates~~decline ~~used~~in ~~were between 10% and 12% and perpetual growth rates used were between 3% or 4%, based on~~ the ~~specific~~overall ~~characteristics~~outlook of ~~the~~this reporting unit. ~~Based~~We oncontinue ~~the~~to ~~results~~expect ofto grow the ~~step~~AS ~~one~~NA ~~tests,~~business ~~the~~over ~~Company determined that~~ the ~~fair~~long-term, ~~values~~albeit ofat ~~each of its reporting units exceeded carrying value and~~ a ~~step~~slower ~~two~~rate ~~test~~than ~~was~~previously ~~not required for any of the 13 reporting units~~planned.

25Prior to completing the step-two test, we first evaluated certain long-lived assets, primarily the software, customer base and property and equipment, for impairment. In performing the impairment tests for long-lived assets, we estimated the undiscounted cash flows for the asset groups over the remaining useful lives of the reporting unit’s primary asset and compared that to the carrying value of the asset groups. There was no impairment of the long-lived assets.

In completing the step-two test to determine the implied fair value of goodwill and therefore the amount of impairment, we first determined the fair value of the tangible and intangible assets and liabilities. Based on the testing performed, we determined that the carrying value of goodwill exceeded its implied fair value and recorded a non-cash goodwill impairment charge of $385 million.

The Company has one other reporting unit, whose goodwill balance was $299 million as of December 31, 2012, where the excess of the estimated fair value over the carrying value of the reporting unit was less than 15% of the carrying value. A one hundred basis point decrease in the perpetual growth rate or a one hundred basis point increase in the discount rate would not cause this reporting unit to fail step one and require a step-two analysis. However, if this unit fails to achieve expected performance levels in the near term or experiences a downturn in the business below current expectations, goodwill could be impaired.

The Company’s ~~has~~remaining ~~three~~ reporting units, whose goodwill balances in ~~the~~ aggregate total $13.2 7 billion asat of December 31, ~~2011~~2012, where the excess of the estimated fair value over carrying value of the reporting unit was less than 15% of the carrying value as of the July 1, 2011 impairment test. A one percentage point decrease in the perpetual growth rate or a one percentage point increase in the discount rate would cause each of these reporting units to fail the step one test and require a step two analysis, and some or all of this goodwill could be impaired. Furthermore, if any of these units fail to achieve expected performance levels in the next twelve months or experience a downturn in the business below current expectations, goodwill could be impaired. The Company’s remaining 10 reporting units each had estimated fair values which exceeded of the carrying value of the reporting unit by at least 2015% as of the July 1, ~~2011~~2012 impairment test. Two of the Company’s 13 reporting units, whose combined goodwill balance was $929 million and was included in assets held for sale as of December 31, 2011, were sold in connection with the HE sale in January 2012.

In 2009, we recorded an adjustment to the state income tax rate used to calculate the deferred income tax liabilities associated with the intangible assets at the LBO date which resulted in reductions to our deferred tax liability and goodwill balances of approximately $114 million. During 2011, we determined that the 2009 adjustment was incorrect and ~~have~~ reversed it, thereby increasing the December 31, 2011 deferred tax liability and goodwill balances each by approximately $100 million for continuing operations and $14 million for assets (liabilities) ~~held~~related ~~for~~to ~~sale~~discontinued operations. ~~During~~As ~~2011, as~~ a result of this correction, we recorded a non-cash goodwill impairment charge of $48 million, of which $36 million related to the impairment charge in 2009 and $12 million related to the impairment charge in 2010, and recorded a $3non-cash ~~million~~ goodwill impairment charge of $3 million in discontinued operations that related to the 2010 impairment charge. In addition, we recorded an income tax benefit of $48 million, of which $35 million related to prior periods, reflecting the amortization of the deferred income tax liability which ~~benefit~~ would have been reflected in the statement of comprehensive income had the 2009 adjustment not been made. Had we recorded the goodwill impairment charges in the correct periods, the impairment charge for 2009 would have been $1.162 billion, and the impairment charge in 2010 would have been $217 million. We ~~have~~ assessed the impact of correcting these errors in ~~the~~2011 ~~current period~~ and do not believe that these amounts are material to any prior period financial statements, nor is the correction of these errors material to the 2011 financial statements. As a result, we have not restated any prior period amounts.

Based on the results of ~~the~~our ~~step one test for the~~ July 1, ~~annual~~2010 ~~impairment~~step-one ~~test for 2010~~tests, we determined that the carrying values of our combined PS and K-12 Education reporting ~~unit~~units, our Public Sector United Kingdom (“PS UK”) reporting unit, which has since been sold and is included in discontinued operations, and our Higher Education Managed Services (“HE MS”) reporting unit, which, ~~along with the remainder of HE,~~ was sold in January 2012 and is included in discontinued operations, were in excess of their respective fair values and a step -two test was required for each of these reporting units. The primary driver for the decline in the fair value of the reporting units compared to the prior year is the reduction in the perpetual growth rate assumption used for each of these three reporting units, stemming from the ~~recent~~ disruption in the global financial markets, particularly the markets which these three reporting units serve. Furthermore, there was a decline in the cash flow projections for the PS and K-12 Education, and PS UK reporting units, compared to those used in the 2009 goodwill impairment test, as a result of decline in the overall outlook for these two reporting units. Additionally, the discount rate assumption used for the PS UK reporting unit was higher than the discount rate used in the 2009 impairment test.

A one percentage point increase in the perpetual growth rate or a one percentage point decrease in the discount rate would have resulted in our HE MS reporting unit having a fair value in excess of carrying value and a step -two test would not have been required.

26Prior to completing the step-two tests, we first evaluated the long-lived assets, primarily the software, customer base and property and equipment, for impairment. In performing the impairment tests for long-lived assets, we estimated the undiscounted cash flows for the asset groups over the remaining useful lives of the reporting unit’s primary asset and compared that to the carrying value of the asset groups. There was no impairment of the long-lived assets.

In completing the step-two tests to determine the implied fair value of goodwill and therefore the amount of impairment, we first determined the fair value of the tangible and intangible assets and liabilities. Based on the testing performed, we determined that the carrying value of goodwill exceeded its implied fair value for each of the three reporting units and recorded a non-cash goodwill impairment charge of $328 million, of which $205 million is presented in continuing operations and $123 million in discontinued operations.

Prior to completing the step two tests, we first evaluated the long-lived assets, primarily the software, customer base and property and equipment, for impairment. In performing the impairment tests for long-lived assets, we estimated the undiscounted cash flows for the asset groups over the remaining useful lives of the reporting unit’s primary asset and compared that to the carrying value of the asset groups. There was no impairment of the long-lived assets.

In completing the step two tests to determine the implied fair value of goodwill and therefore the amount of impairment, we first determined the fair value of the tangible and intangible assets and liabilities. Based on the testing performed, we determined that the carrying value of goodwill exceeded its implied fair value for each of the three reporting units and recorded a goodwill impairment charge of $328 million, of which $205 million is presented in continuing operations and $123 million in discontinued operations.

During 2009, based on an evaluation of year-end results and a reduction in the revenue growth outlook for the AS business, we concluded that AS had experienced a triggering event in its North American reporting unit (“AS NA”), one of two reporting units identified in the July 1, 2009 annual impairment test where the excess of the estimated fair value over the carrying value was less than 10%. As a result, we determined that the carrying value of AS NA was in excess of its fair value. In completing the step two test, we determined that the carrying value of AS NA’s goodwill exceeded its implied fair value by $1.126 billion and recorded a goodwill impairment charge for this amount.

Revenue Recognition

In the fourth quarter of 2010 we adopted, retrospective to the beginning of the year, the provisions of Accounting Standards Update No. 2009-13, Revenue Recognition—Multiple—Deliverable Revenue Arrangements (“ASU 2009-13”) and Accounting Standards Update 2009-14, Software—Certain Revenue Arrangements that Include Software Elements (“ASU 2009-14”). ASU 2009-13 amended existing accounting guidance for revenue recognition for multiple-element arrangements by establishing a selling price hierarchy that allows for the best estimated selling price (“BESP”) to determine the allocation of arrangement consideration to a deliverable in a multiple element arrangement where neither vendor specific objective evidence (“VSOE”) nor third-party evidence (“TPE”) is available for that deliverable. ASU 2009-14 modifies the scope of existing software guidance to exclude tangible products containing software components and non-software components that function together to deliver the product’s essential functionality. In addition, ASU 2009-14 provides guidance on how a vendor should allocate arrangement consideration to non-software and software deliverables in an arrangement where the vendor sells tangible products containing software components that are essential in delivering the tangible product’s functionality.

The following criteria must be met in determining whether revenue may be recorded: persuasive evidence of a contract exists; services have been provided; the price is fixed or determinable; and collection is reasonably assured.

We generate revenue from the following sources: (1) services revenue, which includes revenue from processing services, software maintenance and support, software rentals, recovery and managed services, professional services and broker/dealer fees; and (2) software license fees, which result from contracts that permit the customer to use a SunGard product at the customer’s site.

~~Services~~The ~~revenue~~following iscriteria ~~recorded~~must asbe ~~the~~met ~~services~~in ~~are~~determining ~~provided~~whether ~~based~~revenue onmay ~~the~~be ~~fair~~recorded: ~~value~~persuasive evidence of ~~each~~a ~~element.~~contract ~~Most AS~~exists; services have ~~revenue~~been ~~consists~~provided; ~~of fixed monthly fees based upon~~ the ~~specific~~price ~~computer~~is ~~configuration~~fixed or ~~business~~determinable; ~~process~~and ~~for~~collection ~~which the service~~ is ~~being~~reasonably ~~provided~~assured. ~~When recovering from an~~

27Services revenue is recorded as the services are provided based on the fair value of each element. Most AS services revenue consists of fixed monthly fees based upon the specific computer configuration or business process for which the service is being provided. When recovering from an interruption, customers generally are contractually obligated to pay additional fees, which typically cover the incremental costs of supporting customers during recoveries. FS services revenue includes monthly fees, which may include a fixed minimum fee and/or variable fees based on a measure of volume or activity, such as the number of accounts, trades or transactions, users or the number of hours of service.

interruption, customers generally are contractually obligated to pay additional fees, which typically cover the incremental costs of supporting customers during recoveries. FS services revenue includes monthly fees, which may include a fixed minimum fee and/or variable fees based on a measure of volume or activity, such as the number of accounts, trades or transactions, users or the number of hours of service.

For fixed-fee professional services contracts, services revenue is recorded based upon proportional performance, measured by the actual number of hours incurred divided by the total estimated number of hours for the project. Changes in the estimated costs or hours to complete the contract and losses, if any, are reflected in the period during which the change or loss becomes known.

License fees result from contracts that permit the customer to use a SunGard software product at the customer’s site. Generally, these contracts are multiple-element arrangements since they usually ~~provide~~include ~~for~~ professional services and ongoing software maintenance. In these instances, license fees are recognized upon the signing of the contract and delivery of the software if the license fee is fixed or determinable, collection is probable, and there is sufficient vendor specific evidence of the fair value of each undelivered element. When there are significant program modifications or customization, installation, systems integration or related services, the professional services and license revenue are combined and recorded based upon proportional performance, measured in the manner described above. Revenue is recorded when billed ~~when~~if customer payments are extended beyond normal billing terms, or at acceptance when there is significant acceptance, technology or service risk. Revenue also is recorded over the longest service period in those instances where the software is bundled together with post-delivery services and there is not sufficient evidence of the fair value of each undelivered service element.

With respect to software related multiple-element arrangements, sufficient evidence of fair value is defined as vendor specific objective evidence (“VSOE”). If there is no VSOE of the fair value of the delivered element (which is usually the software) but there is VSOE of the fair value of each of the undelivered elements (which are usually maintenance and professional services), then the residual method is used to determine the revenue for the delivered element. The revenue for each of the undelivered elements is set at the fair value of those elements using VSOE of the price paid when each of the undelivered elements is sold separately. The revenue remaining after allocation to the undelivered elements (i.e., the residual) is allocated to the delivered element.

VSOE supporting the fair value of maintenance is based on the optional renewal rates for each product and is typically 18% to 20% of the software license fee per year. VSOE supporting the fair value of professional services is based on the standard daily rates charged when those services are sold separately.

In some software related multiple-element arrangements, the maintenance or services rates are discounted. In these cases, a portion of the software license fee is deferred and recognized as the maintenance or services are performed based on VSOE of the services.

~~From~~25 time to time we enter into arrangements with customers who purchase non-software related services from us at the same time, or within close proximity, of purchasing software (non-software multiple-element arrangements). Each element within a non-software multiple-element arrangement is accounted for as a separate unit of accounting provided the following criteria are met: the delivered services have value to the customer on a standalone basis; and, for an arrangement that includes a general right of return relative to the delivered services, delivery or performance of the undelivered service is considered probable and is substantially controlled by us. Where the criteria for a separate

From time to time we enter into arrangements with customers who purchase non-software related services from us at the same time, or within close proximity, of purchasing software (non-software multiple-element arrangements). Each element within a non-software multiple-element arrangement is accounted for as a separate unit of accounting provided the following criteria are met: the delivered services have value to the customer on a standalone basis; and, for an arrangement that includes a general right of return relative to the delivered services, delivery or performance of the undelivered service is considered probable and is substantially controlled by us. Where the criteria for a separate unit of accounting are not met, the deliverable is combined with the undelivered element(s) and treated as a single unit of accounting for the purposes of allocation of the arrangement consideration and revenue recognition.

For our non-software multiple-element arrangements, we allocate revenue to each element based on a selling price hierarchy at the arrangement inception. ~~During~~The 2009 the fair value of each undelivered element was determined using VSOE, and the residual method was used to assign a fair value to the delivered element if its VSOE was not available. Under the new rules for 2010 and 2011 described above, the selling price for each element is based upon the following selling price hierarchy: VSOE, then third-party evidence (“TPE”), then best estimated selling price (“BESP”). The total arrangement consideration is allocated to each separate unit of accounting for each of the non-software deliverables using the relative selling prices of each unit based on this hierarchy. We limit the amount of revenue recognized for delivered elements to an amount that is not contingent upon future delivery of additional products or services or meeting of any specified performance conditions. ~~Since under the new hierarchy a fair value for each element will be determinable, the residual method is no longer used.~~

To determine the selling price in non-software multiple-element arrangements, we establish VSOE of the selling price using the price charged for a deliverable when sold separately. Where VSOE does not exist, TPE is established by evaluating similar competitor products or services in standalone arrangements with similarly situated customers. If we are unable to determine the selling price because VSOE or TPE doesn’t exist, we determine BESP for the purposes of allocating the arrangement by considering pricing practices, margin, competition, and geographies in which we offer our products and services.

Unbilled receivables are created when services are performed or software is delivered and revenue is recognized in advance of billings. Deferred revenue is created when billing occurs in advance of performing services or when all revenue recognition criteria have not been met.

We believe that our revenue recognition practices comply with the complex and evolving rules governing revenue recognition. Future interpretations of existing accounting standards, new standards or changes in our business practices could result in changes in our revenue recognition accounting policies that could have a material effect on our consolidated financial results.

Accounting for Income Taxes

WeIncome ~~recognize~~taxes ~~deferred~~are ~~income~~accounted ~~tax~~for ~~assets~~under ~~and liabilities based upon~~ the ~~expected~~asset ~~future~~and ~~tax~~liability ~~consequences of events that have been recognized in our financial statements or tax returns~~method. Deferred income tax assets and liabilities are calculated based on the difference between the financial ~~and~~ ~~tax~~statement ~~bases~~carrying amounts of existing assets and liabilities and their respective tax bases using the ~~currently~~ enacted income tax rates expected to be in effect during the years in which the temporary differences are expected to reverse. Valuation allowances are recorded to reduce deferred tax assets when it is more likely than not that a tax benefit will not be realized. ~~Deferred tax assets for which no valuation allowance is recorded may not be realized upon changes in facts and circumstances.~~ Tax benefits related to uncertain tax positions taken or expected to be taken on a tax return are recorded only when such benefits ~~meet~~are a more likely than not threshold. Otherwise, these tax benefits are recorded when a tax position has been effectively settled, which means that the appropriate taxing authority has completed their examination even though the statute of ~~limitations~~being ~~remains open, or the statute of limitation expires~~sustained. Considerable judgment is required in assessing and estimating these amounts and differences between the actual outcome of these future tax consequences and our estimates could have a material effect on our consolidated financial results.

Accounting for Stock-Based Compensation

Stock-based compensation cost is measured at the grant date based on the fair value of the award and is recognized as expense over the appropriate service period. Fair value for stock options is computed using the Black-Scholes pricing model. Determining the fair value of stock-based awards requires considerable judgment, including estimating the expected term of stock options, expected volatility of our stock price, and the number of awards expected to be forfeited. In addition, for stock-based awards where vesting is dependent upon achieving certain operating performance goals, we estimate the likelihood of achieving the performance goals. Differences between actual results and these estimates could have a material effect on our consolidated financial results. A deferred income tax asset is recorded over the vesting period as stock compensation expense is recognized. Our ability to use the deferred tax asset is ultimately based on the actual value of the stock option upon exercise or restricted stock unit upon distribution. If the actual value is lower than the fair value determined on the date of grant, then there could be an income tax expense for the portion of the deferred tax asset that cannot be used, which could have a material effect on our consolidated financial results.

awards expected to be forfeited. Since the Company is not publicly traded, the Company utilizes equity valuations based on (a) stock market valuations of public companies in comparable businesses, (b) recent transactions involving comparable companies and (c) any other factors deemed relevant (see Note 7). In addition, for stock-based awards where vesting is dependent upon achieving certain operating performance goals, we estimate the likelihood of achieving the performance goals. Differences between actual results and these estimates could have a material effect on our consolidated financial results. A deferred income tax asset is recorded over the vesting period as stock compensation expense is recognized. Our ability to recognize a benefit for this deferred tax asset will be ultimately determined based on the actual value of the stock option upon exercise or restricted stock unit upon distribution. If the actual value is lower than the fair value determined on the date of grant, then there could be income tax expense for the portion of the deferred tax asset that cannot be realized, which could have a material effect on our consolidated financial results.

Results of Operations

We evaluate our performance ofusing ~~our~~both ~~segments~~GAAP ~~based~~and ~~on operating~~non-GAAP ~~results~~measures. ~~before~~Our ~~interest,~~primary ~~income~~non-GAAP ~~taxes,~~measure ~~goodwill~~is ~~impairment~~Internal ~~charges~~Adjusted EBITDA, ~~amortization~~whose ofcorresponding ~~acquisition-related~~GAAP ~~intangible~~measure ~~assets,~~is ~~stock~~income ~~compensation~~from ~~and~~continuing ~~certain~~operations ~~other~~before income ~~costs~~taxes (see Note 1213 of Notes to Consolidated Financial Statements). ~~During~~Internal ~~2010, we~~Adjusted ~~sold~~EBITDA ~~our PS UK operation which~~ is ~~presented~~defined as ~~discontinued~~operating ~~operations.~~income Inexcluding ~~January~~the ~~2012,~~following weitems: ~~sold our Higher Education business which is also presented as discontinued operations.~~

~~Except~~• asdepreciation otherwise noted, all explanations below refer to changes in results excluding the impacts from changes in currency translation, which we refer to as constant currency, a non-GAAP measure. We believe presenting our results on a constant currency basis is meaningful for assessing how our underlying businesses have performed due to the fact that we have international operations that are material to our overall operations. As a result, total revenues and ~~expenses are affected by changes in the U.S. Dollar against international currencies. To present this information~~amortization, current period results for entities reporting in currencies other than U.S. Dollars are converted to U.S. Dollars at the average exchange rate used in the prior year period rather than the actual exchange rates in effect during the current year period. In each of the tables below, we present the percent change based on actual, unrounded results in reported currency and in constant currency. Also, percentages may not add due to rounding.

30• amortization of acquisition-related intangible assets,

•

goodwill impairment,

•

severance and facility closure charges,

•

stock compensation,

•

management fees, and

•

certain other costs.

We believe Internal Adjusted EBITDA is an effective tool to measure our operating performance since it excludes non-cash items and certain variable charges. We use Internal Adjusted EBITDA extensively to measure both SunGard and its reporting segments within the Company and also to our board of directors.

While Internal Adjusted EBITDA is useful for analysis purposes, it should not be considered as an alternative to our reported GAAP results. Also, Internal Adjusted EBITDA may not be comparable to similarly titled measures used by other companies. Internal Adjusted EBITDA is similar, but not identical, to adjusted EBITDA as defined in the Credit Agreement (as defined below) for purposes of our debt covenants.

During 2010, we sold our PS UK operation which is presented as discontinued operations. In January 2012, we sold our Higher Education business which is also presented as discontinued operations.

Except as otherwise noted, all explanations below exclude the impacts from changes in currency translation, which we refer to as constant currency, a non-GAAP measure. We believe presenting our results on a constant currency basis is meaningful for assessing how our underlying businesses have performed due to the fact that we have international operations that are material to our overall operations. As a result, total revenues and expenses are affected by changes in the U.S. Dollar against international currencies. To present this constant currency information, current period results for entities reporting in currencies other than U.S. Dollars are converted to U.S. Dollars at the average exchange rate used in the prior year period rather than the actual exchange rates in effect during the current year period. In each of the tables below, we present the percent change based on actual, unrounded results in reported currency and in constant currency. Also, percentages may not add due to rounding.

~~Year~~The ~~Ended~~following ~~December 31~~discussion reflects the results of operations and financial condition of SCC, which ~~2011~~are ~~Compared~~materially the same as the results of operations and financial condition of SCCII and SunGard. Therefore, the discussions provided are applicable to ~~Year~~each ~~Ended~~of ~~December 31~~SCC, ~~2010~~SCCII and SunGard unless otherwise noted. Also, the following discussion includes historical and certain forward-looking information that should be read together with the accompanying Consolidated Financial Statements and related footnotes and the discussion above of certain risks and uncertainties (see ITEM 1A—RISK FACTORS) that could cause future operating results to differ materially from historical results or the expected results indicated by forward looking statements.

~~The~~Year ~~following~~Ended ~~table sets forth~~December 31, ~~for~~2012 ~~the~~Compared ~~periods indicated, certain amounts included in our Consolidated Statements of Operations and the relative percentage that those amounts represent~~ to ~~consolidated~~Year ~~revenue~~Ended ~~(unless~~December 31, ~~otherwise~~2011 ~~indicated).~~

																Constant Currency
	Year EndedDecember 31,2010						Year EndedDecember 31,2011						PercentIncrease(Decrease)2011 vs. 2010			Year EndedDecember 31,2011						PercentIncrease(Decrease)2011 vs. 2010
(in millions)				percent ofrevenue						percent ofrevenue									percent ofrevenue
Revenue
Financial systems (FS)	$	2,807			63	%	$	2,835			63	%		1	%	$	2,775			63	%		(1	)%
Availability services (AS)		1,469			33	%		1,461			32	%		(1	)%		1,441			33	%		(2	)%
Other (1)		214			5	%		203			5	%		(5	)%		203			5	%		(5	)%
	$	4,490			100	%	$	4,499			100	%		—	%	$	4,419			100	%		(2	)%
Costs and Expenses
Cost of sales and direct operating	$	1,937			43	%	$	1,891			42	%		(2	)%	$	1,855			42	%		(4	)%
Sales, marketing and administration		1,042			23	%		1,095			24	%		5	%		1,071			24	%		3	%
Product development and maintenance		372			8	%		422			9	%		14	%		408			9	%		10	%
Depreciation and amortization		278			6	%		272			6	%		(2	)%		268			6	%		(4	)%
Amortization of acquisition- related intangible assets		451			10	%		438			10	%		(3	)%		435			10	%		(3	)%
Goodwill impairment		205			5	%		48			1	%		(77	)%		48			1	%		(77	)%
	$	4,285			95	%	$	4,166			93	%		(3	)%	$	4,085			92	%		(5	)%
Operating Income
Financial systems (2)	$	622			22	%	$	600			21	%		(4	)%	$	603			22	%		(3	)%
Availability services (2)		326			22	%		321			22	%		(2	)%		316			22	%		(3	)%
Other (1)(2)		57			27	%		57			28	%		(2	)%		57			28	%		(2	)%
Corporate administration		(71	)		(2	)%		(96	)		(2	)%		(34	)%		(96	)		(2	)%		(34	)%
Amortization of acquisition- related intangible assets		(451	)		(10	)%		(438	)		(10	)%		3	%		(435	)		(10	)%		3	%
Goodwill impairment		(205	)		(5	)%		(48	)		(1	)%		77	%		(48	)		(1	)%		77	%
Stock Compensation expense		(29	)		(1	)%		(33	)		(1	)%		(12	)%		(33	)		(1	)%		(12	)%
Other costs (3)		(44	)		(1	)%		(30	)		(1	)%		32	%		(30	)		(1	)%		32	%
	$	205			5	%	$	333			7	%		62	%	$	334			8	%		62	%

(1) Other includes our PS and K-12 businesses. The K-12 business had been included in our Higher Education segment prior to our agreement in the third quarter of 2011 to sell our Higher Education business excluding K-12 (“HE”). As a result of that agreement, HE is now included in discontinued operations.

(2) Percent of revenue is calculated as a percent of revenue from FS, AS and Other, respectively.

(3) Other costs include management fees paid to the Sponsors, purchase accounting adjustments and certain other costs, partially offset in each year by capitalized software development costs.

The following table sets forth, for the periods indicated, certain supplemental revenue data and the relative percentage that those amounts represent to total revenue.

														Constant Currency
	Year EndedDecember 31,2010					Year EndedDecember 31,2011					PercentIncrease(Decrease)2011 vs. 2010			Year EndedDecember 31,2011					PercentIncrease(Decrease)2011 vs. 2010
	Year EndedDecember 31,2011					Year EndedDecember 31,2012					PercentIncrease(Decrease)2012 vs. 2011			Year EndedDecember 31,2012					PercentIncrease(Decrease)2012 vs. 2011
(in millions)			percentofrevenue					percentofrevenue								percentofrevenue
Financial Systems
Financial Systems (FS)
Services	$	2,~~448~~445		55	%	$	2,~~503~~370		56	%		2(3	)%	$	2,~~453~~403		56	%		—(2	)%
License and resale fees		~~257~~259		6	%		~~259~~244		6	%		1(6	)%		~~250~~251		6	%		(3	)%
Total products and services		2,~~705~~704		6061	%		2,~~762~~614		61	%		2(3	)%		2,~~703~~654		6162	%		—(2	)%
Reimbursed expenses		~~102~~72		2	%		7340		21	%		(2945	)%		7240		21	%		(2944	)%
	$	2,807		63	%	$	2,835		63	%		1	%	$	2,775		63	%		(1	)%
Total	$	2,776		63	%	$	2,654		62	%		(4	)%	$	2,694		62	%		(3	)%
Availability Services
Availability Services (AS)
Services	$	1,~~452~~438		32	%	$	1,~~438~~383		32	%		(14	)%	$	1,~~419~~394		32	%		(23	)%
License and resale fees		32		—	%		3		—	%		1(15	)%		3		—	%		—(14	)%
Total products and services		1,~~455~~440		32	%		1,~~441~~386		32	%		(14	)%		1,~~422~~397		32	%		(23	)%
Reimbursed expenses		1420		—	%		2019		—	%		40(3	)%		1920		—	%		35—	%
	$	1,469		33	%	$	1,461		32	%		(1	)%	$	1,441		33	%		(2	)%
Total	$	1,460		33	%	$	1,405		33	%		(4	)%	$	1,417		33	%		(3	)%
Other
Other (1)
Services	$	~~175~~173		4	%	$	173		4	%		(1—	)%	$	173		4	%		(1—	)%
License and resale fees		3528		1	%		2728		1	%		~~(21~~2	)%		2728		1	%		~~(21~~2	)%
Total products and services		~~210~~201		5	%		~~200~~201		45	%		(5—	)%		~~200~~201		5	%		(5—	)%
Reimbursed expenses		43		—	%		3		—	%		(1712	)%		3		—	%		(1712	)%
	$	214		5	%	$	203		5	%		(5	)%	$	203		5	%		(5	)%
Total	$	204		5	%	$	204		5	%		—	%	$	204		5	%		—	%
Total Revenue
Services	$	4,~~075~~056		91	%	$	43,~~114~~926		9192	%		1(3	)%	$	43,~~045~~970		92	%		(12	)%
License and resale fees		~~295~~289		7	%		~~289~~275		6	%		(25	)%		~~280~~282		67	%		(53	)%
Total products and services		4,~~370~~345		9798	%		4,~~403~~201		9899	%		1(3	)%		4,~~325~~252		9899	%		(12	)%
Reimbursed expenses		~~120~~95		32	%		9662		21	%		(2035	)%		9463		21	%		(2134	)%
	$	4,490		100	%	$	4,499		100	%		—	%	$	4,419		100	%		(2	)%
Total	$	4,440		100	%	$	4,263		100	%		(4	)%	$	4,315		100	%		(3	)%

32(1) Other includes our PS and K-12 Education businesses.

~~Results~~Revenue: ~~of operations, excluding broker/dealer business~~

WeTotal ~~assess~~SunGard ~~our~~reported ~~performance~~revenue ~~both~~decreased ~~with~~$177 ~~and~~million, ~~without~~or ~~one~~4%, ofin ~~our~~2012 ~~global~~compared ~~trading~~to ~~businesses,~~2011. On a ~~broker/dealer~~constant ~~with~~currency anbasis, ~~inherently~~revenue ~~lower~~decreased ~~margin~~$125 ~~than our other FS businesses~~million, ~~whose~~or ~~performance~~3%. isApproximately a$56 ~~function~~million of ~~market~~the ~~volatility~~$125 ~~and~~million decrease, ~~customer~~or ~~mix (the “Broker/Dealer”)~~1.3 Bypoints ~~excluding~~of the ~~Broker/Dealer’s~~three ~~results,~~percentage wepoints ~~are~~of ~~able~~decrease, towas ~~perform~~due ~~additional~~to ~~analysis~~a ofdecrease ~~our~~in ~~business~~revenue ~~which~~as we ~~believe~~ isintentionally ~~important~~exited incertain ~~understanding~~lower ~~the~~margin ~~results~~services ofin ~~both~~our ~~the Broker~~broker/~~Dealer~~dealer ~~and~~business (the ~~other FS businesses. We use the information excluding the~~ “Broker/Dealer”). ~~for~~These arevenues ~~variety~~were generally of“pass ~~purposes~~through” ~~and~~fees weto ~~regularly~~stock ~~communicate~~exchanges, ~~our~~as ~~results~~mentioned ~~excluding this business to our board of directors~~below.

~~The~~Our ~~following~~revenue is ahighly ~~reconciliation~~diversified by customer and product. During each of the past three fiscal years, no single customer has accounted for more than 3% of total revenue. ~~excluding~~On average for the ~~Broker/Dealer~~past three fiscal years, services revenue has been approximately 91% of total revenue. About 80% of services revenue is highly recurring as a result of multi-year contracts and ~~operating~~is ~~income~~generated ~~(loss)~~from software-related services including software maintenance and support, processing and rentals; and recovery and managed services. The remaining services ~~excluding~~revenue includes professional services, which are mainly generated from implementation and consulting services in connection with the ~~Broker~~sale of our products; and broker/~~Dealer~~dealer fees, which are ~~each~~largely ~~non-GAAP~~correlated ~~measures,~~with totrading ~~the~~volumes. ~~corresponding~~On ~~reported~~a ~~GAAP~~constant currency ~~measures~~basis, ~~that~~services werevenue ~~believe~~decreased to be$3.97 ~~most~~billion ~~directly~~from ~~comparable~~$4.06 ~~While~~billion, ~~these~~representing ~~adjusted~~approximately ~~results~~92% ~~are~~of ~~useful~~total ~~for~~revenue ~~analysis~~in ~~purposes~~2012, ~~they~~an ~~should~~increase ~~not~~of be1% ~~considered~~from 2011. The revenue decrease of $86 million was mainly due to a $54 million decrease in AS asrecovery services, a $53 million decrease in FS and AS professional services revenue, an ~~alternative~~$8 tomillion ~~our~~decrease ~~reported~~in ~~GAAP~~FS ~~results~~software rental revenue and a $7 million decrease in broker/dealer fee revenue of which the Broker/Dealer’s portion resulted in a decrease of $23 million, partially offset by a $16 million increase in AS managed services revenue, a $13 million increase from FS acquisitions and a $9 million increase in FS processing revenue.

	Year Ended December 31,
	2010			2011			% change			Constant Currency
										2011			% change
Revenue
Total	$	4,490		$	4,499			—	%	$	4,419			(2	)%
Less Broker/Dealer business		184			79						79
Total excluding Broker/Dealer business	$	4,306		$	4,420			3	%	$	4,340			1	%
Financial Systems	$	2,807		$	2,835			1	%	$	2,775			(1	)%
Less Broker/Dealer business		184			79						79
Financial Systems excluding Broker/Dealer business	$	2,623		$	2,756			5	%	$	2,696			3	%
Operating Income (loss)
Total	$	205		$	333			62	%	$	334			62	%
Less Broker/Dealer business		(33	)(1)		(10	)(1)					(10	)(1)
Total excluding Broker/Dealer business	$	238		$	343			44	%	$	344			44	%
Operating margin		6	%		8	%					8	%
Financial Systems	$	622		$	600			(4	)%	$	603			(3	)%
Less Broker/Dealer business		(21	)(1)		(6	) (1)					(6	)		(1	)
Financial Systems excluding Broker/Dealer business	$	643		$	606			(6	)%	$	609			(5	)%
Operating margin		25	%		22	%					23	%

Professional services revenue was $598 million and $648 million in 2012 and 2011, respectively, and are discussed in more detail below. Revenue from total broker/dealer fees was $157 million and $164 million in 2012 and 2011, respectively.

~~(1)~~Reported ~~The~~revenue ~~operating~~from license ~~income~~and ~~(loss)~~resale ~~related~~fees toincludes ~~the~~software ~~Broker/Dealer~~license ~~excluded~~revenue ~~from~~of ~~Total~~$241 million and FS$252 ~~differ~~million, ~~because~~respectively. weOn ~~evaluate~~a ~~performance~~constant ofcurrency ~~our~~basis, ~~segments~~software ~~based~~license onrevenue ~~operating~~decreased ~~results~~$4 ~~before~~million, ~~goodwill~~or ~~impairment~~2%. ~~charges,~~Reimbursed ~~amortization~~expense ofrevenue ~~acquisition-related~~decreased ~~intangible~~$32 ~~assets,~~million ~~stock~~due ~~compensation~~to ~~and~~the decline ~~certain~~in ~~other~~revenue ~~costs~~in the Broker/Dealer.

33Financial Systems segment:

FS reported revenue was $2.65 billion in 2012 compared to $2.78 billion in 2011, a decrease of 4%. On a constant currency basis, revenue decreased $82 million, or 3%. Two percentage points of the decrease, or $56 million, was related to lower revenue from the Broker/Dealer discussed above. Professional services revenue decreased $47 million, or 8%, due primarily to successful completion of projects during 2011 and relatively lower demand in 2012 driven by fewer new license sales, and was offset in part by a $5 million increase from acquisitions. Software rental revenue decreased $8 million, or 2%, due primarily to attrition. Broker/dealer fee revenue (excluding the Broker/Dealer) increased $16 million, or 12%, due primarily to increased trading activity during 2012. Processing revenue increased $9 million, or 1%, due mainly to the impact of new business signed in 2011, higher volumes and rate increases in 2012 and $5 million due to acquisitions. Reported revenue from software license revenue was $229 million, a decrease of $11 million from 2011. On a constant currency basis, software license revenue decreased $4 million, or 2%.

Availability Services segment:

AS reported revenue decreased $55 million, or 4%, in 2012 from the prior year. On a constant currency basis, revenue decreased 3%. In North America, which accounts for over 75% of our AS business, revenue decreased 4% where decreases of $54 million in recovery services (“RS”) and $6 million in professional services revenue exceeded growth of $16 million in managed services (“MS”) revenue. Revenue in Europe, primarily from our U.K. operations, was unchanged, where an increase in MS revenue was offset by a decrease in RS revenue.

Our RS revenue has been declining due to customers’ shifting from traditional backup and recovery solutions to either in-house solutions or disk-, cloud-based or managed recovery solutions. Separately, in MS, demand has been increasing for outsourced management of IT operations and applications. We expect these trends to continue in the future.

Other segment:

Reported revenue and constant currency revenue were unchanged at $204 million in 2012. Professional services revenue decreased $2 million and processing revenue increased $2 million. Revenue from license and resale fees included software license revenue of $10 million in 2012, a $1 million increase from the prior year.

The following table sets forth, for the periods indicated, certain amounts included in our Consolidated Statements of Comprehensive Income and the relative percentage that those amounts represent to consolidated revenue (unless otherwise indicated).


																Constant Currency
	Year Ended December 31,						Year Ended December 31,						Percent Increase (Decrease)			Year Ended December 31,						Percent Increase (Decrease)
	2011						2012						2012 vs. 2011			2012						2012 vs. 2011
				percent of revenue						percent of revenue									percent of revenue
(in millions)
Revenue
Financial Systems	$	2,776			63	%	$	2,654			62	%		(4	)%	$	2,694			62	%		(3	)%
Availability Services		1,460			33	%		1,405			33	%		(4	)%		1,417			33	%		(3	)%
Other		204			5	%		204			5	%		—	%		204			5	%		—	%

Total Revenue	$	4,440			100	%	$	4,263			100	%		(4	)%	$	4,315			100	%		(3	)%

Costs and Expenses
Cost of sales and direct operating (excluding depreciation)	$	1,848			42	%	$	1,740			41	%		(6	)%	$	1,759			41	%		(5	)%
Sales, marketing and administration		1,108			25	%		1,039			24	%		(6	)%		1,055			24	%		(5	)%
Product development and maintenance		393			9	%		353			8	%		(10	)%		367			8	%		(7	)%
Depreciation and amortization		271			6	%		287			7	%		6	%		290			7	%		7	%
Amortization of acquisition— related intangible assets		435			10	%		385			9	%		(11	)%		387			9	%		(11	)%
Goodwill impairment		48			1	%		385			9	%		702	%		385			9	%		702	%

Total Costs and Expenses	$	4,103			92	%	$	4,189			98	%		2	%	$	4,243			98	%		3	%

Internal Adjusted EBITDA
Financial Systems⁽¹⁾	$	720			25.9	%	$	738			27.8	%		2	%	$	738			27.4	%		2	%
Availability Services⁽¹⁾		508			34.8	%		480			34.2	%		(6	)%		484			34.2	%		(5	)%
Other⁽¹⁾		63			31.2	%		66			32.5	%		5	%		66			32.5	%		5	%
Corporate		(70	)		(1.6	)%		(44	)		(1.0	)%		38	%		(44	)		(1.0	)%		37	%

Total Internal Adjusted EBITDA		1,221			27.5	%		1,240			29.1	%		2	%		1,244			28.8	%		2	%
Reconciliation of Internal Adjusted EBITDA to Operating Income
Depreciation and amortization		(271	)		(6.1	)%		(287	)		(6.7	)%		(6	)%		(290	)		(6.7	)%		(7	)%
Amortization of acquisition— related intangible assets		(435	)		(9.8	)%		(385	)		(9.0	)%		11	%		(387	)		(9.0	)%		11	%
Goodwill impairment		(48	)		(1.1	)%		(385	)		(9.0	)%		(702	)%		(385	)		(8.9	)%		(702	)%
Severance and facility closure costs		(65	)		(1.5	)%		(50	)		(1.2	)%		23	%		(51	)		(1.2	)%		22	%
Stock compensation expense		(33	)		(0.7	)%		(38	)		(0.9	)%		(15	)%		(38	)		(0.9	)%		(15	)%
Management fees		(12	)		(0.3	)%		(14	)		(0.3	)%		(15	)%		(14	)		(0.3	)%		(15	)%
Other costs ⁽²⁾		(20	)		(0.4	)%		(7	)		(0.2	)%		60	%		(7	)		(0.2	)%		60	%

Total Operating Income	$	337			7.6	%	$	74			1.7	%		(78	)%	$	72			1.7	%		(79	)%

(1)	Percent of revenue is calculated as a percent of revenue from FS, AS and Other, respectively.

(2)	Other costs include expenses related to strategic initiatives, currency transaction losses, costs to shut down certain services in our Broker/Dealer business (defined above) and certain other costs.

Operating Income:

Our total reported operating margin was 1.7% in ~~2011~~2012 compared to ~~5% in 2010~~7. ~~Excluding the impact of the Broker/Dealer and on a constant currency basis, total operating margin was 8% and~~ 6% in 2011 ~~and 2010, respectively~~. ~~Included~~The inmost ~~2011~~significant ~~and~~factor ~~2010~~impacting ~~were~~the ~~restructuring charges of $77 million and $40 million, respectively, primarily related to severance actions of $66 million and $29 million, respectively~~5.9 ~~Also~~margin ~~included~~point decrease inis the ~~2011 and 2010 restructuring costs were~~ $4385 million ~~and~~goodwill $9impairment ~~million,~~charge ~~respectively,~~related ~~of costs~~ to ~~shutdown~~AS ~~the~~NA ~~Broker/Dealer~~in ~~professional trading business~~2012, ~~and~~whereas ~~$4 million of lease exit costs in~~ 2011. ~~The~~included ~~increase in the operating margin is primarily due to~~ a ~~$205 million~~ goodwill impairment ~~charge~~of ~~in 2010, partially offset by a~~ $48 million. ~~goodwill~~The ~~impairment~~net ~~charge~~impact ~~and~~of anthese ~~$86~~charges ~~million~~was ~~increase~~a in7.8 margin ~~employment-related~~point ~~expenses~~decrease in ~~2011~~2012. The ~~higher~~more ~~employment~~significant ~~expenses~~factors impacting ~~included~~ the ~~severance~~remaining ~~charges noted above~~1. We9 ~~are~~margin ~~continuing~~point toimprovement ~~identify~~are ~~and~~the ~~evaluate~~following: ~~additional cost savings and productivity improvements. Any further actions taken could result in additional charges that may have a material impact to our results of operations in future periods.~~

~~Financial~~• ~~Systems:~~1.1 margin point increase, or $47 million, from the decrease in amortization of acquisition-related intangible assets;

~~The~~• ~~FS operating margin was 22% in each of 2011 and 2010~~0.6 ~~Excluding the impact of the Broker/Dealer and on a constant currency basis, the FS operating~~ margin ~~was~~point ~~23% and 25% in 2011 and 2010, respectively. This decrease in the margin percentage is due to the~~ increase infrom ~~expense exceeding~~ the ~~revenue~~improvement ~~increase of $73 million. The expense increase is due mainly to a $69 million increase~~ in employment-related costs resulting from business expansion, merit increases and increased software development and maintenance expenses, and includes a $27 million increase in severance charges. Also impacting the ~~period~~FS ~~was~~internal aadjusted $7EBITDA ~~million decrease in license fees and $3 million of lease exit costs, partially offset by a $6 million decrease in consultant expense and a $5 million decrease in facilities expenses.~~ margin;

~~The~~• ~~most important~~0.6 ~~factors~~margin ~~affecting~~point increase, or $26 million, from the FSdecrease ~~operating~~in ~~margin~~corporate ~~are:~~expenses resulting from decreases of $20 million of employment-related expenses (excluding severance) and $7 million of advertising expenses;

•

0.3 margin point increase, or $14 million, from lower severance and corporate executive transition costs of $22 million offset in part by an $8 million increase in expenses to exit facilities; and

•

0.3 margin point increase, or $12 million, from the decrease in expenses related to strategic initiatives, currency transaction losses and costs incurred in 2011 due to the exit from the Broker/Dealer;

partially offset by

•

0.4 margin point decrease, or $18 million, from the increase in depreciation and amortization primarily resulting from a shift in AS investments to shorter-lived assets over the last two years while capital expenditures in total have declined; and

•

0.4 margin point decrease from the decrease in the AS internal adjusted EBITDA margin, which excludes the impact of severance.

Excluding the severance charges discussed above, FS improved its total operating margin by 0.6 points due mainly to expense management primarily from reduced external services fees and consulting expenses. Also excluding the severance charges, degradation of total margin by AS of 0.4 points was due primarily to the decrease in recovery services and professional services revenue, partially offset by an increase in revenue from managed services and the decrease in equipment expense.

Across the company, we have several programs designed to continually identify cost savings and productivity improvements. These programs serve to both improve our profitability and help fund our investments. The interplay of savings and investments may result in higher or lower costs in any given quarter. Moreover, short term charges required to secure our long term savings may impact our results in any particular quarter.

Segment Internal Adjusted EBITDA:

Financial Systems segment:

The most important factors affecting the FS Internal Adjusted EBITDA margin are:

•

the level of customer IT spending and its impact on the overall demand for professional services and software license sales,

•

the rate and value of contract renewals, new contract signings and contract terminations,

•

the overall condition of the financial services industry and the effect of any further consolidation among financial services firms,

•

the level of trading volumes, and

•

the operating margins of recently acquired businesses, which tend to be lower at the outset and improve over a number of years.

~~Availability~~More ~~Services:~~specifically, the FS Internal Adjusted EBITDA margin was 27.4% and 25.9% in 2012 and 2011, respectively. The more significant factors impacting the 1.5 margin point improvement are the 0.5 margin point increase, or $14 million, from the decrease in external services fees; the 0.4 margin point increase, or $12 million, from the decrease in consultant expense; the 0.3 margin point increase, or $9 million, from the increase in costs capitalized as software assets; the 0.3 margin point increase, or $8 million, from the decrease in facilities costs (excluding lease exit costs); and the 0.2 margin point increase, or $5 million, from the decrease in communications costs; partially offset by the 0.6 margin point decrease from increases in incentive compensation and employment-related taxes and benefits; and the 0.2 margin point decrease from acquired businesses.

~~The~~Availability ASServices operating margin was 22% in each of 2011 and 2010, respectively. On a constant currency basis, we maintained the operating margin in 2011 on $28 million of lower revenue mainly due to cost containment. The operating margin was impacted by the followingsegment:

~~North~~The ~~America~~most important factors affecting the AS Internal Adjusted EBITDA margin are:

• decreases of $22 million in equipment expense, $6 million of employment-related expense, and $5 million of depreciation and amortization on a $59 million decrease in revenue in our higher-margin recovery services business (“RS”);

• a revenue increase of $27 million and an $8 million decrease in depreciation and amortization, partially offset by a $15 million increase employment-related expenses, including a $3 million increase in severance, a $6 million increase in facilities expenses and a $2 million increase in equipment expenses in our lower-margin managed services business (“MS”); and

• a $7 million increase in segment administration employment-related expense primarily related to developing new products and a $6 million increase in segment advertising costs.

Europe:

• a $9 million increase in revenue and a $2 million decrease in equipment expense, partially offset by a $4 million increase in facilities and a $2 million increase in employment-related expenses.

The most important factors affecting the AS operating margin are:

•

the rate and value of contract renewals, new contract signings and contract terminations,

•

the timing and magnitude of equipment and facilities expenditures,

• the level and success of new product ~~development~~offerings, and

•

the trend toward availability solutions utilizing more dedicated resources.

~~Other:~~More specifically, the AS Internal Adjusted EBITDA margin was 34.2% and 34.8% in 2012 and 2011, respectively, a decrease of 0.6 margin points. In North America, RS, which typically uses shared resources, decreased the overall AS margin by 1.7 margin points in 2012 due primarily to a $54 million decrease in higher-margin recovery services revenue, partially offset by a $20 million decrease in equipment expense. Professional services decreased the overall AS margin by 0.3 margin points in 2012 due primarily to a $1 million increase in employment-related expenses on $6 million of lower revenue. Also in North America, decreases in advertising expenses of $4 million, external services fees of $3 million and employment-related expenses of $3 million helped the margin in 2012 by 0.7 margin points. MS helped the margin in 2012 by 0.6 margin points due primarily to a $16 million increase in typically lower margin managed services revenue, which uses dedicated resources, partially offset by a $4 million increase in employment-related expenses. The overall AS margin was helped by Europe in 2012 by 0.4 margin points due primarily to a $5 million decrease in employment-related expenses.

~~The operating margin for~~ Other ~~was~~segment: ~~28% and 27% for 2011 and 2010, respectively. The operating margin increased due primarily to the decrease in employment-related expense being proportionately more than the decrease in revenue.~~

The most important factors affecting the ~~operating~~ margin of our Other segment are:

•

the rate and value of contract renewals, new contract signings and contract terminations,

•

the level of government and school district funding, and

•

the level of customer IT spending and its impact on the overall demand for professional services and software license sales.

~~Revenue:~~The Internal Adjusted EBITDA margin was 32.5% and 31.2% for 2012 and 2011, respectively. The margin increased 1.3 margin points due primarily to a $2 million increase in costs capitalized as software assets.

Total reported revenue was $4.50 billion in 2011 compared to $4.49 billion in 2010. On a constant currency basis, revenue decreased 2% as reported and increased 1% excluding the Broker/Dealer.

Our revenue is highly diversified by customer and product. During each of the past three fiscal years, no single customer has accounted for more than 10% of total revenue. On average for the past three fiscal years, services revenue has been approximately 91% of total revenue. About 80% of services revenue is highly recurring as a result of multi-year contracts and is generated from (1) software-related services including software maintenance and support, processing and rentals; and (2) recovery and managed services. The remaining services revenue includes (1) professional services, which are recurring in nature as a result of long-term customer relationships; and (2) broker/dealer fees, which are largely correlated with trading volumes. On a constant currency basis, services revenue decreased to $4.05 billion from $4.08 billion, representing approximately 92% of total revenue in 2011 compared to 91% in 2010. The revenue decrease was mainly due to a $77 million decrease in broker/dealer fees by the Broker/Dealer and a $62 million decrease in RS, partially offset by increases of $42 million from FS acquisitions, $38 million in FS processing revenue and $27 million in MS.

Professional services revenue was $689 million and $681 million in 2011 and 2010, respectively. The change was due to FS acquisitions and an increase in FS, partially offset by decreases in AS and Other. Revenue from total broker/dealer fees was $164 million and $217 million in 2011 and 2010, respectively.

Revenue from license and resale fees was $280 million and $295 million for 2011 and 2010, respectively, and includes software license revenue of $243 million and $255 million, respectively.

Financial Systems:

FS reported revenue was $2.84 billion in 2011 compared to $2.81 billion in 2010, an increase of 1%. On a constant currency basis and excluding the Broker/Dealer, revenue increased 3%. Processing revenue increased $38 million, or 5%, due mainly to increases in transaction volumes and additional hosted services and increased $8 million from acquired businesses. Professional services revenue increased $13 million from acquired businesses and increased $6 million, or 1%, due primarily to implementation, consulting and project work associated with new and expanded customer relationships sold in the past twelve months. Software rental revenue decreased $6 million, or 2%, due primarily to customer attrition. Reported revenue from license and resale fees included software license revenue of $240 million, an increase of $3 million compared to 2010. On a constant currency basis, software license revenue decreased $7 million, or 3%.

Availability Services:

AS reported revenue decreased $8 million, or 1%, in 2011 from the prior year. On a constant currency basis, revenue decreased 2%. In North America, which accounts for over 75% of our AS business, revenue decreased 4% with decreases of $62 million in RS and $8 million in professional services revenue exceeding a $27 million increase in MS revenue. Revenue in Europe, primarily from our U.K. operations, increased $9 million, or 3%, where an increase in managed services revenue was partially offset by a decrease in recovery services revenue, and included a $1.5 million increase from a business acquired in 2010.

Most of our RS revenue which is derived from tape-based solutions, has been declining due primarily to attrition to other service providers and customer internal solutions, and demand for recovery services has been shifting from tape-based solutions to disk- and cloud-based advanced recovery solutions. Separately, in MS, demand has been increasing for outsourced management of IT operations and applications. We expect these trends to continue in the future.

Other:

Reported revenue and constant currency revenue from Other both decreased $11 million, or 5%, from the prior year. Professional services revenue decreased $4 million. Revenue from license and resale fees included software license revenue of $9 million in 2011, a $6 million decrease from the prior year.

Costs and Expenses:

Total costs ~~decreased~~increased to 9298% of revenue in ~~2011~~2012 from 95 92% of ~~revenue~~2011 ~~in 2010~~revenue. Excluding the goodwill impairment charges of $48385 million and $~~205~~48 million in ~~2011~~2012 and ~~2010~~2011, respectively, ~~and the Broker/Dealer’s~~ total costs ~~of $89 million in 2011 and $217 million in 2010, total costs~~ as a percentage of total revenue ~~(also~~were ~~excluding the Broker/Dealer) was 91~~89% in ~~2011~~2012 compared to 9091% in ~~2010~~2011, and ~~increased~~decreased $86198 million.

3632

Cost of sales and direct operating expenses (excluding depreciation) as a percentage of total revenue were 4241% in ~~2011~~ 2012 and 4342% in ~~2010. Excluding the Broker/Dealer’s expenses of $79 million in~~ 2011, ~~and $189 million in 2010~~respectively, ~~cost of sales~~ and ~~direct~~decreased ~~operating expenses as a percentage of total revenue (also excluding the Broker/Dealer) were unchanged at 41%, and increased~~ $2888 million. ~~Impacting~~Of the ~~period were a~~ $2388 million ~~increase from acquired businesses~~decrease, a $1745 million ~~increase~~is indue FSto ~~employment-related expenses, including~~ a $4decrease ~~million increase~~ in ~~severance,~~reimbursed ~~and~~expenses arelating ~~$10~~to ~~million~~the ~~increase~~exit infrom AScertain ~~facilities costs,~~services ~~mainly utilities, expansions~~ of ~~certain~~our ~~facilities~~Broker/Dealer ~~that~~business ~~occurred~~as discussed inabove, ~~the second half of 2010~~ and a ~~new facility added during the second quarter of 2010. These expense increases were partially offset by a~~ $2123 million decrease in AS equipment ~~expense,~~ ~~primarily~~costs ~~resulting~~associated ~~from~~with ~~renegotiation~~increased of self-maintenance ~~contracts~~, ~~and~~favorable aprice $4negotiations ~~million~~and ~~decrease~~improved innetwork AScost ~~employment-related~~projects; ~~expenses,~~partially ~~which~~offset ~~includes~~by aan $68 million ~~decrease~~increase infrom ~~severance.~~FS acquisitions.

~~Excluding the Broker/Dealer expenses~~Sales, ~~sales,~~ marketing and administration expenses as a percentage of total revenue ~~(also excluding the Broker/Dealer)~~ were 24% inand ~~each~~25% ofin ~~2011~~2012 and ~~2010~~2011, respectively, and ~~increased~~decreased $4453 million. ~~Increases~~Decreases in sales, marketing and administration expenses were primarily due to adecreases of $3534 million ~~increase~~of incorporate ~~severance~~employment-related ~~and~~expenses mainly as a result of executive transition costs, anincurred ~~$11 million increase~~in ~~resulting~~the ~~from~~second ~~acquired~~quarter ~~businesses~~of 2011 and aother $6severance ~~million~~actions ~~increase~~taken in AS2011 ~~advertising~~and ~~expenses.~~early ~~These~~2012; ~~increases~~$20 ~~were~~million ~~partially~~of ~~offset~~external byservices ~~decreases~~fees; ofand ~~a combined~~ $715 million of FSadvertising expense and ASrelated ~~facilities~~ costs ~~and~~mainly ~~the~~resulting from cost savings initiatives; partially offset by a $5 million ~~decrease~~increase in ~~Broker/Dealer~~stock ~~shutdown costs~~compensation. ~~noted~~Despite ~~above~~these reductions, we continue to make targeted sales investments to improve our growth potential as part of our global strategy.

Because AS product development and maintenance costs are insignificant, it is more meaningful to measure product development and maintenance expenses as a percentage of revenue excluding AS. Product development and maintenance expense was 1412% and 1213% of revenue excluding AS in 2012 and 2011, respectively, and ~~increased~~decreased $3627 million. The ~~increase~~decrease in expense is primarily related to to a $429 million increase in FS ~~employment-related~~costs ~~expenses~~capitalized toas ~~maintain our existing~~ software ~~products~~assets and ~~enhance~~a ~~functionality~~$5 ofmillion ~~our~~decrease ~~software~~in ~~products~~consulting toexpenses. ~~attract~~The ~~and~~software ~~retain~~capitalization ~~customers.~~costs ~~Included~~reflect inspecific ~~the~~investments ~~$42~~that ~~million~~we ~~increase~~are inmaking ~~employment-related expenses~~to isimprove athe $4functionality ~~million~~of ~~increase~~our software in response ~~severance~~to customer needs.

Depreciation and amortization was 7% and 6% of total revenue in ~~each~~2012 ofand 2011, respectively, and ~~2010~~increased $19 million due mainly to a shift in AS investments to shorter-lived assets over the last two years despite a decline in total capital expenditures. Amortization of acquisition-related intangible assets was 9% and 10% of total revenue in 2012 and 2011, ~~but~~and decreased $1048 million. The decrease is due primarily to ~~certain~~the AS$47 million ~~leased~~impact ~~facility~~of ~~improvements~~software ~~becoming~~assets that were fully ~~depreciated~~amortized ~~during~~in ~~2010~~2011 and $7 million of impairment charges in 2011, partially offset by the impact of acquired businesses. During 2011, we recorded impairment charges of our customer base and software assets of $3 million and $4 million, respectively. These impairments are the result of reduced cash flow projections related to the software and customer base assets that were impaired.

~~Excluding~~We ~~the~~recorded ~~Broker/Dealer, amortization of acquisition~~non-~~related~~cash ~~intangible~~goodwill assets was 10% of total revenue (also excluding the Broker/Dealer) in each of 2011 and 2010, but decreased $14 million due primarily to the impact of software that was fully amortized in 2010, partially offset by the impact of acquired businesses. During 2011, we recorded impairment charges of ~~our customer base and software assets of~~ $3385 million and $448 million~~, respectively.~~ ~~During~~in ~~2010,~~2012 ~~we recorded impairment charges of our customer base~~ and ~~software assets of $1 million and $2 million~~2011, respectively. These impairments are described in the ~~result~~Use of ~~reduced~~Estimates ~~cash flow projections related to the software~~ and ~~customer base~~Critical ~~assets~~Accounting ~~that~~Policies ~~were~~section ~~impaired~~above.

WeInterest ~~recorded~~expense ~~goodwill~~was ~~impairment charges of~~ $48428 million and $~~205~~524 million in ~~2011~~2012 and ~~2010~~2011, respectively. ~~These~~The ~~impairments~~decrease ~~are~~in ~~described~~interest expense was due primarily to the repayment in January 2012 of $1.22 billion of our outstanding term loans as a result of the ~~Use~~sale of ~~Estimates~~HE, the early extinguishment in April 2012 of the 2015 Notes (as defined below) and ~~Critical~~interest ~~Accounting~~rate ~~Policies~~decreases ~~section~~resulting ~~above~~from the expiration of interest rate swaps in each of February 2011 and 2012.

~~Interest~~The ~~expense~~loss on extinguishment of debt was $~~524~~82 million and $~~638~~3 million in 2012 ~~2011~~ and ~~2010~~2011, respectively. The ~~decrease~~increase ~~in interest expense~~ was due primarily to ~~interest~~ ~~rate decreases mainly due to~~ the ~~expiration~~early ofextinguishments ~~certain~~ of ~~our~~the ~~interest~~senior ~~rate~~notes ~~swaps~~due 2015 and the ~~refinancing of the~~ senior subordinated notes due ~~2013~~2015, asand ~~well~~the aspartial ~~decreased~~repayment of term ~~loan~~loans ~~borrowings~~in ~~resulting~~January ~~from~~and ~~prepayments that occurred in~~ December ~~2010~~2012.

37The effective income tax rates for 2012 and 2011 were a tax benefit of 9% and 62%, respectively. The Company’s effective tax rate fluctuates from period to period due to changes in the mix of income or losses in jurisdictions with a wide range of tax rates, permanent differences between U.S. GAAP and local tax laws, and certain one-time items including tax rate changes, benefit of foreign taxes, net of a U.S. foreign tax credit, and adjustments related to the repatriation of unremitted earnings of foreign subsidiaries. The effective tax rates for 2012 and 2011 were also impacted by the goodwill impairment charges, which are largely nondeductible.

~~The~~Income (loss) onfrom ~~extinguishment~~discontinued operations, net of ~~debt~~tax, was $331 million in ~~2010~~2012 ~~was~~and ~~due~~$(80) million toin ~~the~~2011. ~~early~~During ~~extinguishments~~2012, we recorded a combined gain on the sales of ~~our~~businesses of $1571 million.~~6 billion~~ During 2011, we recorded $135 million of ~~senior~~deferred ~~notes~~income ~~due~~tax inexpense ~~2013~~related ~~and~~to ~~our~~the ~~euro~~book-~~denominated~~over-tax ~~term~~basis ~~loans.~~difference ~~The~~in ~~loss~~a ~~included~~subsidiary ~~$39~~of ~~million~~our HE business. See Note 2 of ~~tender~~Notes ~~and~~to ~~call~~Consolidated ~~premiums~~Financial Statements for further discussion.

~~Other~~Income ~~income~~(loss) attributable to the non-controlling interest represents accreted dividends on SCCII’s cumulative preferred stock. The amount of accreted dividends was $7251 million ~~in 2010,~~ and ~~included~~ $4225 million in ~~foreign~~2012 ~~currency~~and ~~transaction~~2011, ~~gains~~respectively. ~~related~~The toincrease ~~our~~is ~~euro-denominated~~due ~~term~~to ~~loans~~compounding.

WeYear ~~believe~~Ended ~~that our overall effective income tax rate should typically be between 38% and 40%. However~~December 31, ~~the effective income tax rates for~~ 2011 ~~and~~Compared ~~2010 were a tax benefit of 62% and 14%, respectively, due~~ to ~~certain~~Year ~~unusual~~Ended ~~items. The rate in 2011 includes the impact of tax rate changes~~December 31, including amortization of the deferred income tax liability which benefit would have been reflected in the statement of comprehensive income had a 2009 adjustment not been made (see intangible assets and purchase accounting discussion above), the benefits of foreign taxes, net of U.S. foreign tax credit, and a deferred income tax adjustment associated with the future repatriation of unremitted earnings of certain non-U.S. subsidiaries, partially offset by the nondeductible goodwill impairment charge. The reported benefit in 2010 includes nondeductible goodwill impairment charges and a $45 million charge for recording deferred income taxes on unremitted earnings of certain non-U.S. subsidiaries which are no longer considered to be permanently reinvested, partially offset by a $13 million benefit due primarily to the impact of state tax rate changes on deferred tax assets and liabilities.

Loss from discontinued operations, net of tax, was $76 million in 2011 and $156 million in 2010. During 2011, discontinued operations includes our HE business, which was sold in January 2012, and in which we recorded $135 million of deferred income tax expense related to the book-over-tax basis difference in a subsidiary of this business. During 2010, discontinued operations includes our HE business and our PS UK business which was sold in 2010. The results of our PS UK operation included an impairment charge, net of tax, of $91 million and a loss on disposal of approximately $94 million which included the write-off of the currency translation adjustment (CTA) which is included as a separate component of equity. Also in 2010, we recorded a goodwill impairment charge of $32 million related to HE MS.

Accreted dividends on SCCII’s cumulative preferred stock were $225 million and $191 million in 2011 and 2010, respectively. The increase in dividends is due to compounding. No dividends have been declared by SCCII.

Year Ended December 31, 2010 Compared to Year Ended December 31, 2009

The following table sets forth, for the periods indicated, certain amounts included in our Consolidated Statements of Operations and the relative percentage that those amounts represent to consolidated revenue (unless otherwise indicated).

																Constant Currency
	Year EndedDecember 31,2009						Year EndedDecember 31,2010						PercentIncrease(Decrease)			Year EndedDecember 31,2010						PercentIncrease(Decrease)
													2010 vs. 2009									2010 vs. 2009
(in millions)				percent ofrevenue						percent ofrevenue									percent ofrevenue
Revenue
Financial systems (FS)	$	3,068			64	%	$	2,807			63	%		(9	)%	$	2,821			63	%		(8	)%
Availability services (AS)		1,517			32	%		1,469			33	%		(3	)%		1,469			33	%		(3	)%
Other (1)		221			5	%		214			5	%		(3	)%		214			5	%		(3	)%
	$	4,806			100	%	$	4,490			100	%		(7	)%	$	4,504			100	%		(6	)%
Costs and Expenses
Cost of sales and direct operating	$	2,249			47	%	$	1,937			43	%		(14	)%	$	1,938			43	%		(14	)%
Sales, marketing and administration		992			21	%		1,042			23	%		5	%		1,043			23	%		5	%
Product development and maintenance		354			7	%		372			8	%		5	%		379			8	%		7	%
Depreciation and amortization		275			6	%		278			6	%		1	%		278			6	%		1	%
Amortization of acquisition- related intangible assets		496			10	%		451			10	%		(9	)%		450			10	%		(9	)%
Goodwill impairment		1,126			23	%		205			5	%		(82	)%		205			5	%		(82	)%
	$	5,492			114	%	$	4,285			95	%		(22	)%	$	4,293			95	%		(22	)%
Operating Income
Financial systems (2)	$	618			20	%	$	622			22	%		1	%	$	628			22	%		2	%
Availability services (2)		380			25	%		326			22	%		(14	)%		325			22	%		(15	)%
Other (1)(2)		60			27	%		57			27	%		(3	)%		57			27	%		(3	)%
Corporate administration		(57	)		(1	)%		(71	)		(2	)%		(24	)%		(71	)		(2	)%		(24	)%
Amortization of acquisition- related intangible assets		(496	)		(10	)%		(451	)		(10	)%		9	%		(450	)		(10	)%		9	%
Goodwill impairment		(1,126	)		(23	)%		(205	)		(5	)%		82	%		(205	)		(5	)%		82	%
Stock compensation expense		(31	)		(1	)%		(29	)		(1	)%		6	%		(29	)		(1	)%		6	%
Other costs (3)		(34	)		(1	)%		(44	)		(1	)%		(30	)%		(44	)		(1	)%		(30	)%
	$	(686	)		(14	)%	$	205			5	%		130	%	$	211			5	%		131	%

(1) Other includes our PS and K-12 businesses. The K-12 business had been included in our Higher Education segment prior to our agreement in the third quarter of 2011 to sell HE. As a result of that agreement, HE is now included in discontinued operations.

(2) Percent of revenue is calculated as a percent of revenue from FS, AS and Other, respectively.

(3) Other costs include management fees paid to the Sponsors, purchase accounting adjustments and certain other costs, partially offset in each year by capitalized software development costs.

The following table sets forth, for the periods indicated, certain supplemental revenue data and the relative percentage that those amounts represent to total revenue.

	Year EndedDecember 31,2009					Year EndedDecember 31,2010					PercentIncrease(Decrease)2010 vs. 2009			Constant Currency
														Constant Currency
														Three Months EndedDecember 31,2010					PercentIncrease(Decrease) 2010 vs. 2009
	Year EndedDecember 31,2010					Year EndedDecember 31,2011					PercentIncrease(Decrease)2011 vs. 2010			Year EndedDecember 31,2011					PercentIncrease(Decrease)2011 vs. 2010
(in millions)			percentofrevenue					percentofrevenue								percentofrevenue
Financial Systems
Financial Systems (FS)
Services	$	2,~~737~~396		5754	%	$	2,~~448~~445		55	%		~~(11~~2	)%	$	2,~~458~~398		55	%		~~(10~~—	)%
License and resale fees		~~196~~257		46	%		~~257~~259		6	%		311	%		~~261~~250		6	%		33(3	)%
Total products and services		2,~~933~~653		6160	%		2,~~705~~704		6061	%		(82	)%		2,~~719~~648		6061	%		(7—	)%
Reimbursed expenses		~~135~~101		32	%		~~102~~72		2	%		(2529	)%		~~102~~72		2	%		(2529	)%
	$	3,068		64	%	$	2,807		63	%		(9	)%	$	2,821		63	%		(8	)%
Total	$	2,754		62	%	$	2,776		63	%		1	%	$	2,720		62	%		(1	)%
Availability Services
Availability Services (AS)
Services	$	1,~~496~~452		3133	%	$	1,~~452~~438		32	%		(31	)%	$	1,~~452~~419		3233	%		(32	)%
License and resale fees		43		—	%		3		—	%		~~(35~~1	)%		3		—	%		~~(35~~—	)%
Total products and services		1,~~500~~455		3133	%		1,~~455~~441		32	%		(31	)%		1,~~455~~422		3233	%		(32	)%
Reimbursed expenses		1714		—	%		1420		—	%		~~(13~~40	)%		1419		—	%		~~(11~~35	)%
	$	1,517		32	%	$	1,469		33	%		(3	)%	$	1,469		33	%		(3	)%
Total	$	1,469		33	%	$	1,461		33	%		(1	)%	$	1,441		33	%		(2	)%
Other
Other (1)
Services	$	~~172~~175		4	%	$	~~175~~173		4	%		2(1	)%	$	~~175~~173		4	%		2(1	)%
License and resale fees		4535		1	%		3527		1	%		(2321	)%		3527		1	%		(2321	)%
Total products and services		~~217~~210		5	%		~~210~~200		5	%		(35	)%		~~210~~200		5	%		(35	)%
Reimbursed expenses		4		—	%		43		—	%		(417	)%		43		—	%		(417	)%
	$	221		5	%	$	214		5	%		(3	)%	$	214		5	%		(3	)%
Total	$	214		5	%	$	203		5	%		(5	)%	$	203		5	%		(5	)%
Total Revenue
Services	$	4,~~405~~023		9291	%	$	4,~~075~~056		91	%		(71	)%	$	43,~~085~~990		91	%		(71	)%
License and resale fees		~~245~~295		57	%		~~295~~289		7	%		20(2	)%		~~299~~280		76	%		21(5	)%
Total products and services		4,~~650~~318		97	%		4,~~370~~345		9798	%		(61	)%		4,~~384~~270		9798	%		(61	)%
Reimbursed expenses		~~156~~119		3	%		~~120~~95		32	%		(2320	)%		~~120~~94		32	%		(2321	)%
	$	4,806		100	%	$	4,490		100	%		(7	)%	$	4,504		100	%		(6	)%
Total	$	4,437		100	%	$	4,440		100	%		—	%	$	4,364		100	%		(2	)%

40(1) Other includes our PS and K-12 businesses.

Results of operations, excluding broker/dealer business

The following is a reconciliation of revenue excluding the Broker/Dealer and operating income (loss) excluding the Broker/Dealer, which are each non-GAAP measures, to the corresponding reported GAAP measures that we believe to be most directly comparable. While these adjusted results are useful for analysis purposes, they should not be considered as an alternative to our reported GAAP results.

	Year Ended December 31,
										Constant Currency
	2009			2010			% change			2010			% change
Revenue
Total	$	4,806		$	4,490			(7	)%	$	4,504			(6	)%
Less Broker/Dealer business		587			184						184
Total excluding Broker/Dealer business	$	4,219		$	4,306			2	%	$	4,320			2	%
Financial Systems	$	3,068		$	2,807			(9	)%	$	2,821			(8	)%
Less Broker/Dealer business		587			184						184
Financial Systems excluding Broker/Dealer business	$	2,481		$	2,623			6	%	$	2,637			6	%
Operating Income (loss)
Total	$	(686	)	$	205			130	%	$	211			131	%
Less Broker/Dealer business		31	(1)		(33	)(1)					(33	)(1)
Total excluding Broker/Dealer business	$	(717	)	$	238			133	%	$	244			134	%
Operating margin		(17	) %		6	%					6	%
Financial Systems	$	618		$	622			1	%	$	628			2	%
Less Broker/Dealer business		34	(1)		(21	)(1)					(21	)(1)
Financial Systems excluding Broker/Dealer business	$	584		$	643			10	%	$	649			11	%
Operating margin		24	%		25	%					25	%

(1) The operating income (loss) related to the Broker/Dealer excluded from Total and FS differ because we evaluate performance of our segments based on operating results before goodwill impairment charges, amortization of acquisition-related intangible assets, stock compensation and certain other costs.

Operating Income:

Our total operating margin increased to 5% in 2010 from (14)% in 2009 due to $205 million of goodwill impairment charges in 2010 and $1.13 billion of goodwill impairment charges in 2009. In addition, the operating margin was also impacted by a $58 million increase in license fees, the impact from the Broker/Dealer and the decline in AS margin performance.

Financial Systems:

The FS operating margin increased to 22% in 2010 from 20% in 2009. The operating margin improvement is mainly due to a $67 million increase in software license fees, including the recognition of $32 million of license fee backlog that existed at December 31, 2009. Margin improvement from the reduced contribution from the Broker/Dealer and reduced facilities expense was mostly offset by increased employment-related and other operating expenses. The impact of the decrease in the Broker/Dealer’s revenue and operating income on FS operating margin is an increase in 2010 of one margin point.

Availability Services:

The AS operating margin was 22% in 2010 compared to 25% in 2009. The lower margin was driven by the lower mix of revenue from higher margin RS, which typically use shared resources, and an absolute decline in RS margin due mainly to the lower revenue on a relatively stable fixed cost base and costs related to eliminating redundant network capacity resulting from the redesign and re-architecture of our data communications network. RS cost savings initiatives also produced expense savings in 2010 including lower facilities and employment-related costs. In addition, AS operating margin was impacted by an increase in revenue from lower margin MS, which use dedicated resources, and an absolute decline in MS margin due mainly to higher facilities costs, primarily utility costs related to cooling due to warmer summer temperatures and the addition of a new facility, increased employment-related and temporary staffing costs due to an increased focus on service delivery, and increased costs associated with the redesign and re-architecture of our data communications network and natural demand resulting from revenue growth. Also impacting the change in the margin was a decrease in other administrative expenses in North America, including reduced bad debt expense resulting from improved collections and lower professional services expenses, and the decrease in the margin in our European business mostly due to an increase in employment-related costs and depreciation and amortization, partially offset by reduced bad debt expense.

Other:

The operating margin from Other was 27% in each of 2010 and 2009. Although revenue decreased $7 million, we maintained the operating margin primarily by decreasing employment-related expense.

Revenue:

Total SunGard reported revenue was $4.4944 billion in ~~2010~~2011, ~~compared~~an toincrease of $~~4.81~~3 ~~billion~~million infrom ~~2009, a decrease of 7%~~2010. On a constant currency basis, revenue decreased 6%$73 ~~primarily~~million, ~~due~~or to2%. aApproximately ~~decline~~$104 inmillion ~~the Broker/Dealer’s revenue~~ of ~~$403~~the $73 million decrease, ~~comprised~~or of2.4 ~~$367~~points ~~million~~ of ~~broker/dealer~~the ~~fees~~two ~~and~~percentage ~~$36~~points ~~million~~ of ~~reimbursed expenses~~decrease, ~~partially~~was ~~offset~~due byto a ~~$58~~decrease ~~million increase~~ in ~~software license~~revenue ~~fees.~~from ~~Excluding~~ the Broker/Dealer~~, revenue increased 2%~~.

42On a constant currency basis, services revenue decreased to $3.99 billion from $4.02 billion, representing approximately 91% of total revenue in both 2011 and 2010. The revenue decrease was mainly due to a $77 million decrease in broker/dealer fees by the Broker/Dealer and a $59 million decrease in RS, partially offset by increases of $41 million from FS acquisitions, $38 million in FS processing revenue and $27 million in MS.

Professional services revenue was $634 million and $629 million in 2011 and 2010, respectively. The change was due to an increase in FS, partially offset by decreases in AS and Other. Revenue from total broker/dealer fees was $164 million and $217 million in 2011 and 2010, respectively.

Reported revenue from license and resale fees included software license revenue of $252 million and $255 million, respectively. On a constant currency basis, software license revenue decreased $13 million, or 5%. Reimbursed expense revenue decreased $25 million due to the decline in revenue in the Broker/Dealer.

Financial Systems segment:

FS reported revenue was $2.78 billion in 2011 compared to $2.75 billion in 2010, an increase of 1%. On a constant currency basis, revenue decreased $34 million, or 1%. Year over year, revenue was impacted by four percentage points, or $104 million, from lower Broker/Dealer revenue as discussed above. Processing revenue increased $38 million, or 5%, due mainly to increases in transaction volumes and additional hosted services and an increase of $8 million from acquired businesses. Professional services revenue increased $13 million from acquired businesses and increased $4 million, or 1%, due primarily to implementation, consulting and project work associated with new and expanded customer relationships sold in the past twelve months. Software rental revenue decreased $6 million, or 2%, due primarily to customer attrition. Reported revenue from license and resale fees included software license revenue of $240 million, an increase of $3 million compared to 2010. On a constant currency basis, software license revenue decreased $7 million, or 3%.

Availability Services segment:

AS reported revenue decreased $8 million, or 1%, in 2011 from the prior year. On a constant currency basis, revenue decreased 2%. In North America, which accounts for over 75% of our AS business, revenue decreased 4% with decreases of $59 million in RS and $9 million in professional services revenue exceeding a $27 million increase in MS revenue. Revenue in Europe, primarily from our U.K. operations, increased $9 million, or 3%, where an increase in managed services revenue was partially offset by a decrease in recovery services revenue, and included a $1.5 million increase from a business acquired in 2010.

Other segment:

Reported revenue and constant currency revenue from our Other segment both decreased $11 million, or 5%, in 2011 from 2010. Professional services revenue decreased $4 million. Revenue from license and resale fees included software license revenue of $9 million in 2011, a $6 million decrease from the prior year.

~~Services~~The ~~reported~~following ~~revenue~~table ~~decreased~~sets toforth, ~~$4.09~~for ~~billion~~the ~~from~~periods ~~$4.41 billion~~indicated, ~~representing approximately~~certain ~~91%~~amounts ofincluded ~~total revenue~~ in ~~2010~~our Consolidated ~~compared~~Statements toof ~~92%~~Comprehensive inIncome ~~2009.~~and ~~The~~the ~~revenue~~relative ~~decrease~~percentage ~~was~~that ~~mainly~~those ~~due~~amounts represent to ~~the~~consolidated ~~$367~~revenue ~~million~~(unless ~~decrease~~otherwise ~~in broker/dealer fees noted above~~indicated).

Professional services reported revenue was $681 million and $644 million in 2010 and 2009, respectively. On a constant currency basis, professional services revenue increased $42 million. The change was due to an increase of $56 million in FS, partially offset by a $14 million decrease in AS. Revenue from total broker/dealer fees was $217 million and $570 million in 2010 and 2009, respectively.


																Constant Currency
	Year Ended December 31,						Year Ended December 31,						Percent Increase (Decrease)			Year Ended December 31,						Percent Increase (Decrease)
	2010						2011						2011 vs. 2010			2011						2011 vs. 2010
				percent of revenue						percent of revenue									percent of revenue
(in millions)
Revenue
Financial Systems	$	2,754			62	%	$	2,776			63	%		1	%	$	2,720			62	%		(1	)%
Availability Services		1,469			33	%		1,461			33	%		(1	)%		1,441			33	%		(2	)%
Other		214			5	%		203			5	%		(5	)%		203			5	%		(5	)%

Total Revenue	$	4,437			100	%	$	4,440			100	%		—	%	$	4,364			100	%		(2	)%

Costs and Expenses
Cost of sales and direct operating (excluding depreciation)	$	1,895			43	%	$	1,848			42	%		(2	)%	$	1,815			42	%		(4	)%
Sales, marketing and administration		1,057			24	%		1,108			25	%		5	%		1,085			25	%		3	%
Product development and maintenance		350			8	%		393			9	%		12	%		379			9	%		8	%
Depreciation and amortization		278			6	%		271			6	%		(2	)%		267			6	%		(4	)%
Amortization of acquisition— related intangible assets		448			10	%		435			10	%		(3	)%		432			10	%		(4	)%
Goodwill impairment		205			5	%		48			1	%		(77	)%		48			1	%		(77	)%

Total Costs and Expenses	$	4,233			95	%	$	4,103			92	%		(3	)%	$	4,026			92	%		(5	)%

Internal Adjusted EBITDA
Financial Systems⁽¹⁾	$	708			25.7	%	$	720			25.9	%		2	%	$	721			26.5	%		2	%
Availability Services⁽¹⁾		527			35.9	%		508			34.8	%		(3	)%		501			34.8	%		(5	)%
Other⁽¹⁾		69			32.4	%		63			31.2	%		(8	)%		63			31.2	%		(8	)%
Corporate		(64	)		(1.4	)%		(70	)		(1.6	)%		(11	)%		(70	)		(1.6	)%		(11	)%

Total Internal Adjusted EBITDA		1,240			28.0	%		1,221			27.5	%		(2	)%		1,215			27.9	%		(2	)%
Reconciliation of Internal Adjusted EBITDA to Operating Income
Depreciation and amortization		(278	)		(6.3	)%		(271	)		(6	)%		(2	)%		(267	)		(6	)%		(4	)%
Amortization of acquisition— related intangible assets		(448	)		(10.1	)%		(435	)		(9.8	)%		3	%		(432	)		(9.9	)%		4	%
Goodwill impairment		(205	)		(4.6	)%		(48	)		(1.1	)%		77	%		(48	)		(1.1	)%		77	%
Severance and facility closure costs		(30	)		(0.7	)%		(65	)		(1.5	)%		(122	)%		(65	)		(1.5	)%		(122	)%
Stock compensation expense		(29	)		(0.7	)%		(33	)		(0.7	)%		(12	)%		(33	)		(0.8	)%		(12	)%
Management fees		(16	)		(0.4	)%		(12	)		(0.3	)%		25	%		(12	)		(0.3	)%		25	%
Other costs ⁽²⁾		(30	)		(0.7	)%		(20	)		(0.4	)%		34	%		(20	)		(0.5	)%		34	%

Total Operating Income	$	204			4.6	%	$	337			7.6	%		65	%	$	338			7.7	%		65	%

~~Reported~~(1) ~~revenue~~Percent ~~from~~of ~~license~~revenue ~~and~~is ~~resale~~calculated ~~fees~~as ~~was~~a ~~$295~~percent ~~million~~of ~~and~~revenue ~~$245~~from ~~million for 2010 and 2009~~FS, ~~respectively,~~AS and ~~includes software license revenue of $255 million and $201 million~~Other, respectively. ~~On a constant currency basis, software license revenue increased $58 million, or 29%.~~

~~SunGard ended 2009 with a software license backlog of $35 million in FS, which consisted of signed contracts for licensed software that~~ (i2) at ~~our~~Other ~~election,~~costs ~~was~~include ~~not~~expenses ~~shipped~~related to ~~the~~strategic ~~customer until 2010~~initiatives, ~~(ii) we~~currency ~~voluntarily~~transaction ~~extended~~losses, ~~payment~~costs ~~terms~~to orshut ~~(iii) included~~down ~~products~~certain or services ~~not~~of ~~yet deliverable and from which~~ the ~~license~~Broker/Dealer ~~element~~business ~~cannot~~(defined beabove) ~~separated.~~and Ofcertain ~~this~~other ~~backlog, $32 million was recognized in 2010~~costs.

~~Financial~~36 ~~Systems:~~

FS reported revenue was $2.81 billion in 2010 compared to $3.07 billion in 2009, a decrease of 9%. On a constant currency basis, revenue decreased by 8% in 2010. Excluding the Broker/Dealer business, revenue increased 6%. The 6% increase is primarily driven by increases in software license, professional services and processing revenue. Professional services revenue increased $56 million, or 10%, due to a general increase in demand from existing clients as well as new projects. Processing revenue increased $23 million, or 3%, mainly driven by increases in transaction volumes and additional hosted services. Reported revenue from license and resale fees included software license revenue of $237 million, an increase of $63 million compared to 2009, reflecting the recognition in 2010 of $32 million that was in backlog at December 31, 2009 and improved economic conditions in 2010. On a constant currency basis, software license revenue increased $67 million, or 39%.

Availability Services:

AS revenue was $1.47 billion in 2010 compared to $1.52 billion in 2009, a 3% decrease. In North America, which accounts for approximately 80% of our AS business, revenue decreased 4.5% where decreases in RS and professional services revenue exceeded growth in MS revenue. Revenue in Europe, primarily from our U.K. operations, increased 1.5%, where increases in managed services revenue were partially offset by decreases in recovery services revenue, and increased $4 million from the impact of an acquisition.

Other:

Revenue from Other was $214 million in 2010 compared to $221 million in 2009. The $7 million, or 3%, decrease was due primarily to an $8 million decrease in software license fees. Revenue from license and resale fees included software license fees of $15 million and $23 million in 2010 and 2009, respectively.

Operating Income:

Our total reported operating margin was 7.7% in 2011 compared to 4.6% in 2010. The most significant factor impacting the 3.1 margin point increase is the $205 million non-cash goodwill impairment charge related to our PS and K-12 businesses, which are included in Other, in 2010, whereas 2011 included a non-cash goodwill impairment of $48 million. The net impact of these charges was a 3.5 margin point increase in 2011. The more significant factors impacting the remaining 0.4 margin point decrease are the following:

•

0.8 margin point decrease, or $36 million, from the increase in restructuring costs including increases in severance and corporate executive transition of $33 million and a $3 million increase in expenses to exit facilities;

•

0.5 margin point decrease from the decrease in the AS margin, which excludes the impact of severance;

•

0.3 margin point decrease, or $13 million, from the decrease in software license fee revenue; and

•

0.2 margin point decrease, or $7 million, from the increase in corporate costs;

partially offset by

•

0.5 margin point increase from the lower activity level of the Broker/Dealer;

•

0.4 margin point increase, or $16 million, from the decrease in amortization of acquisition-related intangible assets;

•

0.2 margin point increase, or $11 million, from the decrease in depreciation and amortization due primarily to certain AS leased facility improvements becoming fully depreciated; and

•

0.2 margin point increase, or $10 million, from the decrease in expenses related to strategic initiatives, currency transaction losses and costs incurred by the Broker/Dealer to shutdown its professional trading business in 2011.

Segment Internal Adjusted EBITDA:

Financial Systems segment:

The FS Internal Adjusted EBITDA margin was 26.5% and 25.7% in 2011 and 2010, respectively. The more significant factors impacting the 0.8 margin point improvement are the 1.6 margin point improvement from the decreased activity level of the Broker/Dealer; the 0.5 margin point improvement, or $12 million, from the decrease in consultant expense; and the 0.1 margin point improvement, or $2 million, from the decrease in facilities costs (excluding lease exit costs). These increases in the operating margin were partially offset by the 1.2 margin point improvement, or $33 million, from the increase in employment-related costs (excluding severance) resulting from business expansion, merit increases and increased software development and maintenance expenses, the 0.5 margin point improvement from acquired businesses and the 0.2 margin point improvement, or $7 million, from the decrease in license fees.

Availability Services segment:

The AS Internal Adjusted EBITDA margin was 34.8% and 35.9% in 2011 and 2010, respectively, a decrease of 1.1 margin points. The overall AS margin was decreased by 0.8 margin points from increased expenses in North America in 2011 resulting from increased employment-related expenses of $9 million (excluding severance) primarily related to developing new products, and segment advertising costs of $6 million. Professional services had a 0.3 margin point decrease on the overall AS margin in 2011 due primarily to a $2 million decrease in employment-related expenses on $8 million of lower revenue. RS had a 0.3 margin point decrease on the overall AS margin in 2011 due primarily to a $59 million decrease in higher margin recovery services revenue, partially offset by a $22 million decrease in equipment expense. Software had a 0.5 margin point impact on the overall AS margin in 2011 due primarily to reduced employment-related expenses of $7 million. MS helped the overall AS margin in 2011 by 0.1 margin points due primarily to a $27 million increase in revenue, partially offset by an $11 million increase in employment-related expenses and a $6 million increase in

facilities costs. Europe helped the overall AS margin in 2011 by 0.1 margin points due primarily to a $9 million increase in revenue and a $2 million decrease in equipment expense, partially offset by a $4 million increase in facilities and a $2 million increase in employment-related expenses (excluding severance).

Other segment:

The Internal Adjusted EBITDA margin from our Other segment was 31.2% and 32.4% for 2011 and 2010, respectively. The more significant factors impacting the 1.2 margin point decrease are the 1.3 margin point impact, or $3 million, from the decrease in costs capitalized as software assets.

Costs and Expenses:

Total costs decreased to 9592% of revenue in ~~2010~~2011 from ~~114~~95% of ~~2009~~2010 revenue. Excluding the goodwill impairment charges of $~~205~~48 million ~~in 2010~~ and ~~$1.13 billion in 2009 and the Broker/Dealer’s total~~ ~~costs of~~ $~~217~~205 million in ~~2010~~2011 and ~~$556~~2010, ~~million in 2009~~respectively, total costs as a percentage of total revenue ~~(also~~were ~~excluding~~91% ~~the~~of ~~Broker/Dealer)~~revenue ~~was~~in ~~unchanged~~each atof ~~90%~~2011 and ~~increased~~2010, and decreased $5949 million.

Cost of sales and direct operating expenses (excluding depreciation) as a percentage of total revenue ~~was~~were 4342% in ~~2010~~2011 and 4743% in ~~2009~~2010, ~~largely~~and decreased $80 million. Impacting the ~~result~~comparison of ~~the~~2011 compared ~~lower~~to ~~volumes~~2010 ofis ~~the~~a ~~Broker/Dealer.~~$110 ~~Excluding~~million decrease in costs of the Broker/Dealer’s ~~expenses~~which ofincludes a $~~189~~95 million decrease in ~~2010~~reimbursed ~~and~~expenses; a $~~534~~21 million decrease in ~~2009~~AS equipment expense, ~~cost~~primarily resulting from renegotiation of ~~sales~~maintenance contracts, and ~~direct~~a $4 million ~~operating~~decrease in AS employment-related expenses, aswhich includes a ~~percentage~~$6 ofmillion ~~total~~decrease ~~revenue~~in ~~(also~~severance. ~~excluding~~These ~~the~~expense ~~Broker/Dealer)~~decreases ~~was~~were ~~40% in~~partially ~~2010~~offset ~~compared~~by toan ~~41%~~increase in ~~2009~~FS employment-related expenses, ~~and~~including ~~increased~~a $35 3 million. ~~Also~~increase ~~impacting~~in severance; ~~the~~a ~~period were increases of~~ $1123 million inincrease ~~employee-related~~from ~~expenses~~acquired ofbusinesses; ~~Other,~~and a $1110 million ofincrease in AS ~~data~~facilities ~~communications network~~ costs, ~~associated~~mainly ~~with~~utilities, ~~the~~expansions ~~redesign and re-architecture~~ of ~~our~~certain ~~data~~facilities ~~communications~~that ~~network~~occurred ~~and~~in ~~$10~~the ~~million~~second half of AS2010 ~~facilities,~~and ~~partially offset by~~ a ~~decrease~~new offacility ~~$12~~added ~~million~~during inthe FSsecond quarter ~~employment-related~~of ~~expense~~2010.

Sales, marketing and administration expenses as a percentage of total revenue ~~was~~were 2325% and 2124% in ~~2010~~2011 and ~~2009~~ 2010, respectively~~. Excluding the Broker/Dealer’s expenses of $22 million in 2010 and $13 million in 2009~~, ~~sales, marketing~~ and ~~administration~~increased ~~expenses as a percentage of total revenue (also excluding the Broker/Dealer) was 24% and 23% in 2010 and 2009, respectively. The resulting~~ $4028 million. ~~increase~~Increases in sales, marketing and administration expenses ~~was~~were ~~due~~ primarily due to aincreases of $3118 million ~~increase~~of incorporate FS employment-related ~~expense~~expenses ~~resulting~~mainly ~~from~~as ~~increased~~a ~~employment~~result toof ~~support~~executive ~~both~~transition ~~growth~~costs incurred in the ~~business~~second ~~and~~quarter ~~international~~of ~~expansion,~~2011 ~~principally in Asia~~ and ~~Brazil,~~other asseverance ~~well~~actions ~~as annual~~taken ~~increases~~in ~~following~~2011; ~~cost~~an ~~restraint~~$11 inmillion ~~2009~~increase ~~due~~resulting tofrom ~~economic~~acquired ~~conditions~~businesses; and ~~includes~~ a $76 million increase in ~~severance.~~AS ~~Also impacting the change were increases of $8 million of~~ advertising ~~and trade show~~ expenses,. $8These ~~million~~increases ofwere ~~currency transaction losses and $5 million of professional services expense,~~ partially offset by decreases of a combined $137 million of FS ~~facilities~~and ~~expense,~~AS ~~resulting from~~ facilities ~~consolidation~~costs ~~in 2009,~~ and the $95 million ofdecrease ~~bad~~in ~~debt~~Broker/Dealer ~~expense~~shut-down incosts ~~AS,~~noted above.

Because AS ~~software~~product development and maintenance costs are insignificant, it is more meaningful to measure product development and maintenance ~~expense~~expenses as a percentage of revenue ~~from~~excluding ~~software and processing solutions~~AS. InProduct ~~2010~~development and ~~2009,~~maintenance ~~software~~expense ~~development~~was ~~expenses were 12~~13% and 1112%, ~~respectively,~~ of revenue excluding AS, anrespectively, ~~increase~~and ofincreased $2428 million. The increase is primarily related to aan ~~$16 million~~ increase in FS employment-related expenses to maintain and enhance our existing software products ~~and~~in response to ~~enhance~~customer ~~functionality~~needs. ofIncluded ~~our~~in ~~software~~the ~~products~~increase toin ~~attract~~employment-related ~~and~~expenses ~~retain~~is ~~customers~~a $4 million increase in severance.

~~Amortization~~Depreciation ofand ~~acquisition-related~~amortization ~~intangible assets~~ was 106% of total revenue in each of ~~2010~~2011 and ~~2009. During 2009~~2010, webut ~~shortened~~decreased ~~the remaining useful lives of certain intangible assets and also recorded impairment charges of our customer base and software assets of~~ $1811 million ~~and~~due ~~$17~~primarily ~~million, respectively. These impairments are the result of reduced cash flow projections related~~ to ~~the~~certain ~~software~~AS leased ~~and~~facility ~~customer~~improvements ~~base~~becoming ~~assets~~fully ~~that~~depreciated ~~were~~during ~~impaired~~2010.

WeAmortization ~~recorded~~of ~~goodwill~~acquisition-related intangible assets was 10% of total revenue in each of 2011 and 2010, but decreased $16 million due primarily to the impact of software that was fully amortized in 2010, partially offset by the impact of acquired businesses. During 2011, we recorded impairment charges of our customer base and software assets of $~~205~~3 million inand ~~Other~~$4 inmillion, respectively. During 2010, we recorded impairment charges of our customer base and software assets of $1~~.13~~ ~~billion~~million inand AS$2 inmillion, ~~2009~~respectively. These impairments are ~~described in~~ the ~~Use~~result of reduced ~~Estimates~~cash flow projections related to the software and ~~Critical~~customer ~~Accounting~~base ~~Policies~~assets ~~section~~that ~~above~~were impaired.

~~Interest~~We ~~expense~~recorded ~~was~~goodwill impairment charges of $~~638~~48 million ~~in 2010~~and ~~compared to~~ $~~637~~205 million in ~~2009.~~2011 ~~Interest~~and ~~expense in~~ 2010, ~~compared~~respectively. toThese ~~2009~~impairments ~~was~~are ~~impacted~~described byin the ~~following:~~Use ~~(a) lower~~of ~~average~~Estimates ~~borrowings~~and ~~under~~Critical ~~our~~Accounting ~~term~~Policies ~~loans~~section atabove. ~~a slightly higher interest rate, (b) higher average debt outstanding resulting from the timing of~~

4438

~~our~~Interest ~~borrowings~~expense ~~and~~was ~~delayed~~$524 ~~repayment~~million ~~due~~and to$638 ~~calling~~million ~~bonds~~in ~~that~~2011 ~~were~~and ~~not~~2010, ~~tendered~~respectively. ~~related~~The decrease toin ~~the~~interest ~~refinance~~expense ofwas ~~our~~due ~~$1.6~~primarily ~~billion~~to ofinterest ~~senior~~rate ~~notes~~decreases mainly due ~~2013~~to atthe aexpiration ~~lower~~of certain of our interest rate, ~~(c) higher average~~swaps ~~borrowings~~and onthe ~~our~~refinancing ~~accounts~~of ~~receivable~~the ~~facility~~senior atnotes adue ~~lower~~2013, ~~interest~~as ~~rate~~well ~~and~~as ~~(d) lower~~decreased ~~average~~term loan borrowings ~~under~~resulting ~~our~~from prepayments ~~revolving~~that ~~credit~~occurred ~~facility~~in December 2010.

The loss on extinguishment of debt in 2010 was due to the early extinguishments of our $1.6 billion of senior notes due in 2013 and our euro-denominated term loans. The loss included $39 million of tender and call premiums.

Other income was $7 million in 2010, ~~compared~~and toincluded $154 million in ~~2009. The decrease is due primarily to a $9 million decrease in~~ foreign currency transaction gains related to our euro-denominated term loans.

The effective income tax rates for ~~each~~2011 ofand 2010 ~~and 2009~~ were a tax benefit of 1462% and 914%, respectively, ~~reflecting~~due ~~nondeductible~~to ~~goodwill~~certain ~~impairment~~unusual ~~charges~~items. The rate in ~~both~~2011 ~~years~~includes the impact of tax rate changes, the benefits of foreign taxes, net of U.S. foreign tax credit, and an adjustment associated with the future repatriation of unremitted earnings of certain non-U.S. subsidiaries, partially offset by the nondeductible goodwill impairment charge. The reported benefit in 2010 ~~also~~ includes nondeductible goodwill impairment charges and a $45 million charge for recording deferred income taxes on unremitted earnings of certain non-U.S. subsidiaries which were ~~are~~ no longer considered to be permanently reinvested, partially offset by a $13 million benefit due primarily to the impact of state tax rate changes on deferred tax assets and liabilities. The reported benefit from income taxes in 2009 also includes a $12 million favorable adjustment primarily related to utilization in our 2008 U.S. federal income tax return of foreign tax credit carryforwards that were not expected to be utilized at the time of the 2008 tax provision.

Loss from discontinued operations, net of tax, was $80 million in 2011 and $156 million in 2010 ~~compared~~. toDuring ~~income~~2011, ~~from~~ discontinued operations, included ~~net~~our ofEuropean ~~tax~~consulting business which was sold in 2012 and our HE business, ofwhich ~~$67~~was ~~million~~sold in ~~2009~~January 2012. ~~Discontinued~~During 2010, discontinued operations includes our European consulting business, our HE business and our PS UK ~~businesses~~business inwhich ~~both~~was sold ~~years.~~in ~~During~~ 2010,. weThe ~~sold~~results of our PS UK operation ~~which~~ included an impairment charge, net of tax, of $91 million and a loss on disposal of approximately $94 million which included the write-off of the currency translation adjustment (CTA) which is included as a separate component of equity. Also in 2010, we recorded a goodwill impairment charge of $32 million related to HE MS. See Note 1 of Notes to Consolidated Financial Statements for further discussion.

Accreted dividends on SCCII’s cumulative preferred stock were $~~191~~225 million and $~~180~~191 million in ~~2010~~2011 and ~~2009~~2010, respectively. The increase in dividends is due to compounding. No dividends have been declared by SCCII through December 31, 2011.

Liquidity and Capital Resources:

At December 31, ~~2011~~2012, ~~cash~~our ~~and~~liquidity ~~cash~~was ~~equivalents~~$1.40 inbillion, ~~continuing~~comprised ~~operations~~of ~~were~~cash and cash equivalents of $~~868~~546 million, ana ~~increase~~decrease of $97327 million from December 31, ~~2010~~2011, ~~while~~and ~~availability~~capacity under our revolving credit facility ~~was~~of $~~858~~857 million. Approximately $~~249~~248 million of cash and cash equivalents at December 31, ~~2011~~2012 was held by our wholly owned non-USU.S. subsidiaries. While available to fund operations and strategic investment opportunities abroad, most of these funds cannot be repatriated for use in the United States without incurring additional tax costs and, in ~~some~~a few cases, are in countries with currency restrictions. Our re-evaluation during the fourth quarter of 2012 of amounts permanently reinvested has no impact on these additional tax costs or our ability to repatriate these funds. Also, approximately $7072 million of cash and cash equivalents at December 31, ~~2011~~ 2012 relates to our broker/dealer operations ~~which~~and is not readily available for general corporate use ~~without adversely affecting the operation of the broker/dealer businesses~~.

Cash flow from continuing operations was $~~602~~645 million in ~~2011~~2012 compared to cash flow from continuing operations of $~~603~~606 million in ~~2010~~2011. ~~Savings~~ ofImproving cash ~~payments~~flow offrom ~~interest,~~continuing ~~principally~~operations was the following:

45• $51 million of lower interest payments in 2012;

•

a $42 million increase in cash earned from operations, defined as operating income adjusted for certain noncash expenses and the cash portion of other income (expense); and

~~resulting~~• ~~from~~$25 ~~the~~million ~~expiration~~more ~~of interest rate swaps and interest rate reductions from refinancing the senior notes due 2013, was mostly offset by lower operating earnings before interest and taxes and less~~ cash provided by working capital. ~~Cash~~due ~~flow~~primarily ~~from continuing operations was $603 million in 2010 compared~~ to ~~cash~~a ~~flow~~one-time ~~from~~benefit ~~continuing operations of $550 million~~ in ~~2009.~~2012 ~~The increase in cash flow~~ from ~~continuing~~exiting ~~operations~~certain islower ~~due primarily~~margin toservices ~~the termination in December 2008~~ of ~~our~~the ~~off-balance sheet accounts receivable securitization program~~Broker/Dealer, ~~which~~partially ~~reduced~~offset ~~2009~~by ~~operating~~timing ~~cash flow, and $94 million less~~ of ~~income~~payment ~~tax payments, net~~ of ~~refunds,~~accounts inpayable ~~2010,~~and ~~partially~~recognizing ~~offset by the reduction~~ in ~~operating~~2012 ~~income~~a ~~after~~portion ~~adjusting~~of ~~for~~our ~~the~~deferred ~~noncash~~revenue ~~goodwill impairments~~ in ~~2010~~excess ~~and~~of ~~2009.~~new sales;

~~Net~~partially ~~cash~~offset ~~used~~ by ~~continuing~~ operations in investing activities was $315 million in 2011 and $376 million in 2010. During 2011, we spent $35 million for five acquisitions, whereas we spent $82 million for four acquisitions during 2010. Capital expenditures for continuing operations were $276 million in 2011 and $298 million in 2010. In 2009, net cash used by continuing operations in investing activities was $323 million, primarily related to $13 million spent on three acquisitions and $315 million of capital expenditures.

In• ~~2011, net cash used~~ by ~~continuing~~a ~~operations in financing activities was~~ $~~253~~79 million, ~~which included~~increase ~~$239~~in ~~million~~income oftax ~~debt~~ payments~~. In 2010~~, net ~~cash used by continuing operations in financing activities was $344 million, which included the repurchase and optional redemption~~ of our senior notes due 2013 along with the associated premiums and $265 million of term loan prepayments, and the issuance of $900 million of senior notes due 2018 and $700 million of senior notes due 2020 (net of associated fees)refunds. We also increased our borrowings under our accounts receivable securitization program by $63 million in 2010. In 2009, net cash used by continuing operations in financing activities was $627 million, primarily related to repayment at maturity of the $250 million senior secured notes and repayment of $500 million of borrowings under our revolving credit facility, partially offset by cash received from the new receivables facility (net of associated fees).

46Cash flow from continuing operations in 2011 was $606 million compared to $601 million in 2010. Lower interest payments of $143 million in 2011, principally resulting from the expiration of interest rate swaps and interest rate reductions from refinancing the senior notes due 2013, was mostly offset by lower operating earnings before interest and taxes and less cash provided by working capital.

Net cash used by continuing operations in investing activities was $297 million in 2012 and $315 million in 2011. During 2012, we spent $40 million for two acquisitions, as compared to $35 million for five acquisitions during 2011. Capital expenditures for continuing operations were $260 million in 2012 and $276 million in 2011. Net cash used by continuing operations in investing activities was $376 million in 2010. During 2010, we spent $82 million for four acquisitions and $298 million for capital expenditures.

In 2012, net cash used by continuing operations in financing activities was $2.04 billion, which included the following:

•

repayment of $1.22 billion of term loans resulting from the sale of HE;

•

$1.02 billion to repurchase and optionally redeem $1 billion of senior subordinated notes due 2015;

•

a $724 million preferred stock dividend;

•

$527 million to redeem the 10.625% senior notes due 2015; and

•

$217 million of optional prepayments of term loans;

partially offset by

•

the issuance of $1 billion of senior subordinated notes due 2019; and

•

a $720 million term loan to fund the dividend.

In 2011, net cash used by continuing operations in financing activities was $253 million, which included $239 million of debt payments. In 2010, net cash used by continuing operations in financing activities was $344 million, which included the repurchase and optional redemption of our senior notes due 2013 along with the associated premiums and $265 million of term loan prepayments, and the issuance of $900 million of senior notes due 2018 and $700 million of senior notes due 2020 (net of associated fees). We also increased our borrowings under our accounts receivable securitization program by $63 million in 2010.

As a result of the LBO (August 11, 2005), we are highly leveraged. See Note 5 of Notes to Consolidated Financial Statements which contains a full description of our debt. Total debt outstanding as of December 31, ~~2011~~2012 was $76.8366 billion, which consists of the following (in millions):

	December 31,2011
	December 31,2012
Senior Secured Credit Facilities:
Secured revolving credit facility	$	—
Secured revolving credit facility due November 29, 2016	$	—
Tranche A, effective interest rate of 3.33%		1,386
Tranche A due February 28, 2014, effective interest rate of 1.96%		207
Tranche B, effective interest rate of 4.32%		2,407
Tranche B due February 28, 2016, effective interest rate of 4.35%		1,719
Incremental term loan at 3.78%		479
Tranche C due February 28, 2017, effective interest rate of 4.17%		908
Total Senior Secured Credit Facilities		4,272
Tranche D due January 31, 2020, effective interest rate of 4.50%		720
Senior Notes due 2014 at 4.875%, net of discount of $8		242
Total Senior Secured Credit Facilities		3,554
Senior Notes due 2015 at 10.625%, net of discount of $3		497
Senior Secured Notes due 2014 at 4.875%, net of discount of $4		246
Senior Notes due 2018 at 7.375%		900
Senior Notes due 2020 at 7.625%		700
Senior Subordinated Notes due 2015 at 10.25%		1,000
Senior Subordinated Notes due 2019 at 6.625%		1,000
Secured accounts receivable facility at 3.79%		200
Secured accounts receivable facility, at 3.71%		250
Other, primarily acquisition purchase price and capital lease obligations		18
Other, primarily foreign bank debt, acquisition purchase price and capital lease obligations		12
Total debt		76,~~829~~662
Short-term borrowings and current portion of long-term debt		(1063	)
Long-term debt	$	76,~~819~~599

Senior Secured Credit Facilities

AsWe ofhave December 31, 2011, our senior secured credit facilities (“Credit Agreement”) consist of (1) $1.39 billion of U.S. dollar-denominated tranche A term loans maturing on February 28, 2014, (2) $2.41 billion of U.S. dollar-denominated tranche B term loans maturing on February 28, 2016, (3) $479 million of U.S. dollar-denominated incremental term loans maturing on February 28, 2014, and (4) an $880 million revolving credit facility ~~that expires on May 11~~, ~~2013.~~of Atwhich ~~December 31, 2011, we have~~ $~~858~~857 million ofwas ~~borrowing capacity~~ available tofor usborrowing ~~on the revolving credit facility~~ after giving effect to $2223 million in of outstanding letters of credit as of December 31, 2012.

As more fully discussed in Note 2 of Notes to ~~Consolidated~~ Consolidated Financial Statements, in January 2012, we completed the sale of HE. The “net cash proceeds,” ~~as defined in the Credit Agreement,~~ from the HE sale ~~were~~of $1.22 billion, ~~which~~were we applied on a pro-rata basis to ~~the~~repay ~~repayment~~a portion of ~~a portion~~our term loans, including $396 million of ~~outstanding~~tranche ~~indebtedness~~A, as$689 ~~follows~~million ~~(in~~of tranche ~~millions):~~B and $137 million of incremental term loans.

	December 31, 2011		Less: Repayment onJanuary 20, 2012			RemainingBalance
Senior Secured Credit Facilities:
Secured revolving credit facility	$	—	$	—		$	—
Tranche A		1,386		(396	)		990
Tranche B		2,407		(689	)		1,718
Incremental term loan		479		(137	)		342
Total Senior Secured Credit Facilities	$	4,272	$	(1,222	)	$	3,050

On March 2, 2012, we amended the Amended and Restated Credit Agreement dated as of August 11, 2005, as amended and restated from time to time (“Credit Agreement”) to, among other things, extend the maturity date of $908 million in aggregate principal amount of tranche A and incremental term loans from February 28, 2014 to February 28, 2017 (“tranche C”), extend the maturity of our $880 million revolving credit facility commitments from May 11, 2013 to November 29, 2016, and amend certain covenants and other provisions in order to, among other things, permit the potential spin-off of the Availability Services business. The revolving credit facility commitments and tranche C each have springing maturities which are described in the Credit Agreement filed with SunGard’s Form 8-K dated March 7, 2012.

47On December 17, 2012, we amended our Credit Agreement to, among other things, allow for the issuance of a $720 million term loan (“tranche D”), permit incremental credit extensions under the restated credit agreement

in an amount up to $750 million; and modify certain covenants and other provisions in order to, among other

~~During~~ things, ~~the~~permit ~~third~~additional ~~and~~restricted ~~fourth~~payments ~~quarters~~to ofbe ~~2011,~~made wewith ~~repaid~~the innet ~~full~~proceeds ~~our~~of the tranche AD term loan and ~~tranche~~available ~~B pound~~cash ~~sterling-denominated~~in ~~term~~an ~~loans~~aggregate ~~totaling~~amount ~~£78~~not to exceed $750 million. Tranche D has certain springing maturities which are described in the Credit Agreement filed with SunGard’s Form 8-K dated December 20, 2012.

On ~~March~~December 231, 2012, we ~~amended~~voluntarily ~~the~~prepaid ~~Credit Agreement to, among other things, extend the maturity date of approximately~~ $~~908~~ 48 million of the tranche A ~~and incremental~~ term ~~loans~~loan ~~from~~and ~~February~~the ~~28,~~entire ~~2014~~outstanding toincremental ~~February 28,~~term ~~2017,~~loan ~~extend~~balance ~~the maturity~~ of ~~our~~ $~~880~~169 million ~~revolving credit facility from May 11, 2013 to November 29, 2016, and amend certain covenants and other provisions in order to, among other things, permit the potential spin-off of AS~~.

On ~~November 10~~March 8, ~~2011~~2013, weSunGard amended ~~the~~and restated its Credit Agreement to, ~~modify~~among other things, (i) issue an additional term loan of $2,200 million (“tranche E”) maturing on March 8, 2020, the ~~definition~~proceeds of ~~consolidated~~which ~~EBITDA~~were used to ~~allow~~(a) ~~for~~repay in full the ~~inclusion~~$1,719 million tranche B term loan and (b) repay $481 million of ~~EBITDA~~the ~~generated~~tranche byC ~~discontinued~~term ~~operations~~loan; ~~until~~(ii) ~~such~~replace ~~operations~~the $880 million of ~~are~~revolving ~~actually~~commitments ~~sold~~with ~~for~~$850 ~~purposes~~million of ~~calculating~~new ~~compliance~~revolving ~~with~~commitments, which will mature on March 8, 2018; and (iii) modify certain covenants and other provisions in order to, among other things (x) modify (and in the case of the term loan facility, remove) the financial maintenance covenants included therein and (y) permit the Company to direct the net cash proceeds of permitted dispositions otherwise requiring a prepayment of term loans to the prepayment of specific tranches of term loans at the Company’s sole discretion. The interest rate on tranche E is LIBOR plus 3% with a 1% LIBOR floor, which at March 8, 2013 was 4.00%. SunGard is required to repay installments in quarterly principal amounts of 0.25% of its funded tranche E principal amount through the maturity date, at which time the remaining aggregate principal balance is due. Tranche E and the new revolving credit commitments are subject to certain springing maturities which are described in the Credit Agreement.

OnSenior ~~March 11,~~and ~~2011,~~Senior weSubordinated ~~amended the~~Notes Credit Agreement to, among other things, obtain new revolving credit commitments of $300 million that increased the Company’s aggregate revolving credit commitments by $50 million to approximately $880 million.

On ~~January~~November 3116, ~~2011~~2010, we ~~amended~~issued ~~the~~$900 ~~Credit~~million ~~Agreement~~aggregate ~~to,~~principal ~~among~~amount ~~other~~of ~~things,~~7.375% ~~(a) eliminate~~senior ~~the~~notes ~~LIBOR~~due 2018 and ~~Base~~$700 ~~Rate~~million ~~floors~~aggregate ~~and (b) reduce~~principal ~~the~~amount ~~Eurocurrency~~of ~~interest~~7.625% ~~rate~~senior ~~spread~~notes todue 32020.~~50%~~ ~~from~~The ~~3.75%~~net ~~and~~proceeds, together ~~the~~with ~~base~~other ~~rate~~cash, ~~spread~~were used to 2retire the former $1.~~50%~~6 ~~from~~billion 29.75125% ~~with~~senior nonotes ~~impact~~that onwould ~~maturity~~have been due 2013.

~~Senior~~On April 2, ~~Notes~~2012, we redeemed for $527 million plus accrued and unpaid interest to the redemption date, all of our outstanding $500 million 10.625% senior notes due 2015 under the Indenture dated as of September 29, 2008.

On November 1, ~~2010~~2012, we issued $~~900~~1 ~~million~~billion aggregate principal amount of 76.~~375~~625% senior subordinated notes due ~~November~~2019 ~~2018~~(“senior subordinated notes due 2019”) and used a portion of the net proceeds from this offering to repurchase approximately $~~700~~490 million of 7our $1 billion 10.~~625~~25% senior subordinated notes due ~~November~~2015 ~~2020~~(“existing senior subordinated notes”). ~~The~~On December 3, ~~proceeds~~2012, ~~together~~we ~~with~~redeemed ~~other~~the ~~cash,~~remaining ~~were~~existing ~~used~~senior tosubordinated ~~retire~~notes. ~~the~~We ~~former~~paid a $~~1.6~~21 ~~billion~~million ~~9.125%~~premium ~~senior~~to ~~notes~~extinguish ~~that~~the ~~would~~existing ~~have~~senior ~~been~~subordinated ~~due 2013~~notes.

OnThe ~~February 21,~~senior ~~2012,~~subordinated wenotes ~~announced that we will redeem all of our outstanding 10.625% Senior Notes~~ due ~~2015~~2019 ~~under~~contain ~~the~~registration ~~Indenture dated~~rights asby ofwhich ~~September 29,~~we ~~2008~~have ~~(as~~agreed ~~amended~~to oruse ~~supplemented~~our ~~from~~reasonable ~~time~~best efforts to ~~time,~~register ~~the~~with ~~“2015 Indenture”) among SunGard,~~ the ~~guarantors~~U.S. ~~named~~Securities & ~~therein,~~Exchange ~~and~~Commission ~~The~~notes having ~~Bank~~substantially ofidentical ~~New~~terms. ~~York~~We ~~Mellon,~~will asuse ~~trustee.~~our Wereasonable ~~expect~~best efforts to ~~redeem~~cause the ~~2015~~exchange ~~senior~~offer ~~notes~~to ~~on April 2,~~be ~~2012~~completed ator, aif ~~redemption~~required, ~~price equal~~ to ~~105.313%~~have ofone ~~the~~or ~~aggregate~~more ~~principal~~shelf ~~amount~~registration ~~plus~~statements ~~accrued~~declared ~~and~~effective ~~unpaid~~within ~~interest~~360 todays after the ~~redemption~~issue date, ~~pursuant~~of the tosenior ~~Section 3.07(d)~~subordinated ofnotes ~~the~~due ~~2015 Indenture~~2019.

If we fail to satisfy this obligation (a “registration default”), the annual interest rate on the senior subordinated notes due 2019 will increase by an additional 0.25% for each subsequent 90-day period during which the registration default continues, up to a maximum additional interest rate of 1.00% per year. The applicable interest rate will revert to the original level upon the earlier of curing the registration default or November 1, 2014.

Secured Accounts Receivable Facility

In March 2009, ~~SunGard~~we entered into a syndicated three-year secured accounts receivable facility. The facility limit was $317 million, which consisted of a term loan commitment of $181 million and a ~~revolving~~ ~~commitment of $136 million. Advances may be borrowed and repaid under the~~ revolving commitment with no impact on the facility limit. The term loan commitment may be repaid at any time at SunGard’s option, but will result in a permanent reduction in the facility limit. On September 30, 2010, SunGard entered into an Amended and Restated Credit and Security Agreement related to its receivables facility. Among other things, the amendment (a) increased the borrowing capacity under the facility from $317 million to $350 million, (b) increased the term loan component to $200 million from $181 million, (c) extended the maturity date to September 30, 2014, (d) removed the 3% LIBOR floor and set the interest rate to one-month LIBOR plus 3.5%, which at December 31, 2011 was 3.79%, and (e) amended certain terms.

4842

In of ~~connection~~$136 ~~with~~million. ~~the~~Advances ~~sale~~may ofbe ~~our~~borrowed HEand ~~business,~~repaid under the ~~participating~~revolving HEcommitment ~~subsidiaries~~with ~~were removed~~no ~~from~~impact on the ~~receivables~~ facility, ~~effective~~limit. asThe ofterm ~~October~~loan 3commitment may be repaid at any time at our option, ~~2011.~~but will Asresult in a ~~result,~~permanent reduction in the ~~combined~~facility ~~total~~limit. ~~amount~~On ~~available~~September 30, ~~for~~2010, ~~borrowing~~we ~~under~~entered ~~the~~into an Amended and Restated Credit and Security Agreement related to our receivables facility. ~~was~~Among ~~reduced~~other things, the amendment (a) increased the borrowing capacity under the facility from $317 million to $350 million, (b) increased the term loan component from $181 million to $~~290~~200 million, (c) extended the maturity date to September 30, 2014, (d) removed the 3% LIBOR floor and set the interest rate to one-month LIBOR plus 3.5%, which at December 31, 2012 was 3.71%, and (e) amended certain terms.

AtIn ~~December 31,~~connection ~~2011,~~with ~~$200~~the ~~million~~sale ~~was~~of ~~drawn~~our ~~against~~HE business, the ~~term~~participating ~~loan~~HE ~~commitment~~subsidiaries ~~and~~were ~~none~~removed ~~was~~from ~~drawn~~the ~~against~~receivables ~~the~~facility, ~~revolving~~effective ~~commitment. At~~as ~~December~~of October 313, 2011. As a result, we permanently reduced the maximum revolving commitment amount to $~~572~~90 million offor ~~accounts~~a ~~receivables~~combined ~~secured~~total ~~the~~amount ~~borrowings~~available ~~under~~for ~~the~~borrowing ~~receivables~~of ~~facility~~$290 million.

~~SunGard~~On December 19, is2012, ~~subject~~we toentered into a ~~fee~~Second onAmended ~~the~~and ~~unused~~Restated ~~portion~~Credit ofand ~~0.75% per~~Security ~~annum.~~Agreement ~~The~~to, ~~receivables~~among ~~facility~~other ~~contains~~things, ~~certain~~extend ~~covenants~~the ~~and~~maturity wedate ~~are required~~ to ~~satisfy~~December 19, 2017 and ~~maintain~~reduce ~~specified~~the ~~facility~~aggregate ~~performance~~commitments ~~ratios,~~from ~~financial~~$290 ~~ratios~~million ~~and~~to ~~other~~$275 ~~financial condition tests~~million.

At December 31, 2012, $200 million was drawn against the term loan commitment and $50 million was drawn against the revolving commitment, which was repaid on January 2, 2013. At December 31, 2012, $519 million of accounts receivable secured the borrowings under the receivables facility.

The receivables facility includes a fee on the unused portion of 0.75% per annum and contains certain covenants. We are required to satisfy and maintain specified facility performance ratios, financial ratios and other financial condition tests.

Interest Rate Swaps

We use interest rate swap agreements to manage the amount of our floating rate debt in order to reduce our exposure to variable rate interest payments associated with the senior secured credit facilities. We pay a stream of fixed interest payments for the term of the swap, and in turn, receive variable interest payments based on one-month LIBOR or three-month LIBOR (0.~~295~~21% and 0.~~581~~31%, respectively, at December 31, ~~2011~~2012). The net receipt or payment from the interest rate swap agreements is included in interest expense. A summary of our interest rate swaps at December 31, ~~2011~~2012 follows (in millions):

Inception	Maturity		NotionalAmount(in millions)		Interest ratepaid			Interestratereceived(LIBOR)
January / February 2009		February 2012	$	1,200		1.78	%		1-Month
February 2010		May 2013	$	500		1.99	%		3-Month
February 2010		May 2013		500		1.99	%		3-Month
August-September 2012		February 2017		400		0.69	%		1-Month
Total/Weighted average interest rate			$	~~1,700~~900		1.8441	%

Contractual Obligations

At December 31, ~~2011~~2012, our contractual obligations follow (in millions):

	Total		~~2012~~2013		~~2013 -~~ 2014		2015 ~~- 2016~~		~~2017and After~~2016—2017		Thereafter
Short-term and long-term debt (1)	$	76,~~829~~662	$	1063	$	~~2,365~~461	$	~~3,853~~8	$	12,~~601~~844	$	3,286
Interest payments (2)		21,~~147~~987		~~462~~357		~~847~~346		~~492~~338		~~346~~519		427
Operating leases		~~1,140~~994		~~194~~178		~~315~~163		~~238~~132		~~393~~211		310
Purchase obligations (3)		~~252~~223		~~150~~141		9350		527		45		—
	$	119,~~368~~866	$	~~816~~739	$	31,~~620~~020	$	~~4,588~~505	$	23,~~344~~579	$	4,023

~~Taking~~43 into effect the sale of HE, the January 2012 prepayment of $1.222 billion of term loans, the March 2012 extension of the maturity date of $908 million of term loans to 2017, and the April 2012 early redemption of our 10.625% Senior Notes, our contractual obligations are as follows (in millions):

	Total		2012			2013		2014		2015 - 2016		2017and After
Short-term and long-term debt (5)	$	6,637	$	537	(4)	$	7	$	865	$	2,719	$	2,509
Interest payments (6)		2,013		412			374		352		520		355
Operating leases		1,125		190			165		145		234		391
Purchase obligations (3)		231		138			62		27		4		—
	$	10,005	$	1,277		$	608	$	1,392	$	3,476	$	3,252

(1)	The senior notes due 2014 are recorded at $246 million as of December 31, 2012, reflecting the remaining unamortized discount. The $4 million discount at December 31, 2012 will be amortized and included in interest expense over the remaining periods to maturity.

(12) ~~The~~Interest ~~senior~~payments ~~notes~~consist ~~due~~of ~~2014~~interest on both fixed-rate and variable-rate debt. Variable-rate debt consists primarily of the ~~senior~~tranche ~~notes~~A ~~due~~secured ~~2015~~term ~~are~~loan ~~recorded~~facility ($207 million at 1.96%), the tranche B term loan facility ($~~242~~1.22 ~~million~~billion ~~and~~at 3.84%), the tranche C term loan facility ($~~497~~508 million, ~~respectively~~at 3.96%), asthe oftranche ~~December~~D ~~31,~~term ~~2011~~loan facility ($720 million at 4.50%), ~~reflecting~~and the ~~remaining~~secured ~~unamortized~~accounts ~~discount.~~receivable ~~The~~facility ($11250 million ~~discount~~ at ~~December 31~~3.71%), ~~2011~~each ~~will~~as beof ~~amortized~~December ~~and~~31, ~~included~~2012. inSee ~~interest~~Note ~~expense~~5 ~~over~~of ~~the~~Notes ~~remaining~~to ~~periods~~Consolidated toFinancial ~~maturity~~Statements.

(2) Interest payments consist of interest on both fixed-rate and variable-rate debt. Variable-rate debt consists primarily of the tranche A secured term loan facility ($1.39 billion at 3.33%), the tranche B term loan facility ($2.41 billion at 4.32%), the incremental term loan ($479 million at 3.78%) and the secured accounts receivable facility ($200 million at 3.79%), each as of December 31, 2011. See Note 5 of Notes to Consolidated Financial Statements.

(3)	Purchase obligations include our estimate of the minimum outstanding obligations under noncancelable commitments to purchase goods or services.

~~(4)~~On ~~Includes $500 million of senior notes recorded at~~ a $3pro ~~million~~forma ~~discount~~basis ~~and~~as aof ~~call~~December ~~premium~~31, of2012, ~~$27~~taking ~~million.~~into ~~The~~account $3the ~~million~~March ~~discount~~8, ~~will~~2013 beCredit ~~expensed~~Agreement ~~through~~amendment, our ~~the~~contractual ~~date~~obligations ofare ~~redemption~~as offollows ~~the~~(in ~~notes.~~millions):

(5) The senior notes due 2014 are recorded at $242 million as of December 31, 2011, reflecting the remaining unamortized discount. The $8 million discount at December 31, 2011 will be amortized and included in interest expense over the remaining periods to maturity.


	Total		2013		2014		2015		2016-2017		Thereafter
Short-term and long-term debt ⁽¹⁾	$	6,662	$	80	$	483	$	30	$	688	$	5,381
Interest payments ⁽²⁾		2,320		356		347		339		660		618
Operating leases		994		178		163		132		211		310
Purchase obligations ⁽³⁾		223		141		50		27		5		—

	$	10,199	$	755	$	1,043	$	528	$	1,564	$	6,309

~~(6)~~At ~~Interest~~December 31, ~~payments~~2012, ~~consist~~contingent ofpurchase ~~interest~~price onobligations ~~both~~that ~~fixed-rate~~depend ~~and~~upon ~~variable-rate~~the ~~debt.~~operating performance ~~Variable-rate debt consists primarily~~ of ~~the~~certain ~~tranche~~acquired Abusinesses ~~secured~~were ~~term loan facility (~~$~~254~~6 million ~~at 3.33%)~~, ~~the~~of ~~tranche~~which ~~B term loan facility (~~$~~1.72~~3 ~~billion~~million atis ~~4.32%),~~included ~~the~~in ~~new~~other ~~tranche C~~ long-term ~~loan facility ($908 million at 4~~debt.~~05%),~~ ~~the~~We ~~incremental~~also ~~term~~have ~~loan~~outstanding ~~($170~~letters ~~million~~of atcredit ~~3.78%)~~ and ~~the~~bid ~~secured~~bonds ~~accounts~~that ~~receivable~~total ~~facility~~approximately ($~~200~~36 million ~~at 3~~.~~79%),~~ ~~each as of December 31, 2011. See Note 5 of Notes to Consolidated Financial Statements.~~

~~At December 31,~~We ~~2011,~~expect ~~contingent~~our ~~purchase~~cash ~~price~~on ~~obligations~~hand, ~~that~~cash ~~depend~~flows ~~upon~~from ~~the~~operations, ~~operating~~availability ~~performance~~under ofour ~~certain~~revolving ~~acquired~~credit ~~businesses~~facility ~~were~~and $7our ~~million,~~accounts ofreceivable facility ~~which~~to $4provide ~~million~~sufficient isliquidity ~~included~~to infund ~~other~~our ~~accrued~~current ~~expenses.~~obligations, Weprojected ~~also~~working ~~have~~capital ~~outstanding~~requirements ~~letters~~and ~~of credit~~capital ~~and~~spending ~~bid~~for ~~bonds~~a period that ~~total~~includes ~~approximately~~at ~~$37~~least ~~million~~the next 12 months.

We expect our cash on hand, cash flows from operations and availability under our revolving credit facility and our accounts receivable facility to provide sufficient liquidity to fund our current obligations, projected working capital requirements and capital spending for a period that includes at least the next 12 months.

Depending on market conditions, SunGard, its Sponsors and their affiliates may from time to time repurchase debt securities issued by SunGard, in privately negotiated or open market transactions, by tender offer or otherwise.

Covenant Compliance

Our senior secured credit ~~agreement~~facilities and the indentures governing our senior notes due ~~2015,~~ 2018 and 2020 and our senior subordinated notes due ~~2015~~2019 contain various covenants that limit our ability to engage in specified types of transactions. These covenants limit our ability to, among other things:

•

incur additional indebtedness or issue certain preferred shares,

•

pay dividends on, repurchase or make distributions in respect of our capital stock or make other restricted payments,

•

make certain investments,

•

sell certain assets,

•

create liens,

•

consolidate, merge, sell or otherwise dispose of all or substantially all of our assets, and

•

enter into certain transactions with our affiliates.

In addition, pursuant to the Principal Investor Agreement by and among our Holding Companies and the Sponsors, we are required to obtain approval from certain Sponsors prior to the declaration or payment of any dividend by us or any of our subsidiaries (other than dividends payable to us or any of our wholly owned subsidiaries).

Under the senior secured credit agreement, we are required to satisfy and maintain specified financial ratios and other financial condition tests. As of December 31, ~~2011~~2012, we are in compliance with all financial and nonfinancial covenants. While we believe that we will remain in compliance, our continued ability to meet those financial ratios and tests can be affected by events beyond our control, and there is no assurance that we will continue to meet those ratios and tests.

Adjusted earnings before interest, taxes, depreciation and amortization (“EBITDA”) is a non-GAAP measure used to determine our compliance with certain covenants contained in the indentures governing the senior notes due ~~2015,~~ 2018 and 2020 and senior ~~subordinated~~ subordinated notes due ~~2015~~2019 and in our senior secured credit agreement. Adjusted EBITDA is defined as EBITDA further adjusted to exclude unusual items and other adjustments permitted in calculating covenant compliance under the indentures and our senior secured credit agreement. We believe that including supplementary information concerning Adjusted EBITDA is appropriate to provide additional information to investors to demonstrate compliance with our financing covenants.

~~The~~A breach of covenants in our senior secured credit agreement that are tied to ratios based on Adjusted EBITDA could result in a default and the lenders could elect to declare all amounts borrowed due and payable. Any such acceleration would also result in a default under our indentures. Additionally, under our debt agreements, our ability to engage in activities such as incurring additional indebtedness, making investments and paying dividends is also tied to ratios based on Adjusted EBITDA.

Adjusted EBITDA does not represent net income (loss) or cash flow from operations as those terms are defined by GAAP and does not necessarily indicate whether cash flows will be sufficient to fund cash needs. While Adjusted EBITDA and similar measures are frequently used as measures of operations and the ability to meet debt service requirements, these terms are not necessarily comparable to other similarly titled captions of other companies due to the potential inconsistencies in the method of calculation. Adjusted EBITDA does not reflect the impact of earnings or charges resulting from matters that we may consider not to be indicative of our ongoing operations. In particular, the definition of Adjusted EBITDA in the indentures allows us to add back certain noncash, extraordinary or unusual charges that are deducted in calculating net income (loss). However, these are expenses that may recur, vary greatly and are difficult to predict. Further, our debt instruments require that Adjusted EBITDA be calculated for the most recent four fiscal quarters. As a result, the measure can be disproportionately affected by a particularly strong or weak quarter. Further, it may not be comparable to the measure for any subsequent four-quarter period or any complete fiscal year. Adjusted EBITDA is similar, but not identical, to Internal Adjusted EBITDA used to measure our performance (see Note 13 of Notes to Consolidated Financial Statements).

5145

~~the~~The ~~method~~following ofis ~~calculation.~~a ~~Adjusted~~reconciliation ~~EBITDA~~for ~~does~~SunGard ~~not reflect the impact~~ of ~~earnings~~income or(loss) ~~charges resulting~~ from ~~matters~~continuing ~~that~~operations, which weis ~~may~~a ~~consider~~GAAP ~~not~~measure ~~to be indicative~~ of our ~~ongoing~~operating ~~operations. In particular~~results, ~~the~~to ~~definition of~~ Adjusted EBITDA inas ~~the~~defined ~~indentures allows us to add back certain noncash, extraordinary or unusual charges that are deducted~~ in ~~calculating~~our ~~net~~debt ~~income~~agreements (~~loss~~in millions). ~~However,~~The ~~these~~terms ~~are~~and ~~expenses~~related ~~that~~calculations ~~may recur, vary greatly and~~ are ~~difficult~~defined toin ~~predict. Further, our debt instruments require that Adjusted EBITDA be calculated for~~ the ~~most~~credit ~~recent four fiscal quarters~~agreement. As a result, the measure can be disproportionately affected by a particularly strong or weak quarter. Further, it may not be comparable to the measure for any subsequent four-quarter period or any complete fiscal year.

The following is a reconciliation for SunGard of income (loss) from continuing operations, which is a GAAP measure of our operating results, to Adjusted EBITDA as defined in our debt agreements (in millions). The terms and related calculations are defined in the indentures.


	2010			2011			2012
Income (loss) from continuing operations	$	(414	)	$	(69	)	$	(397	)
Interest expense, net		636			521			427
Taxes		(69	)		(118	)		(38	)
Depreciation and amortization		726			706			672

EBITDA		879			1,040			664
Goodwill impairment charge		205			48			385
Purchase accounting adjustments (a)		13			11			9
Non-cash charges (b)		36			34			39
Restructuring and other (c)		55			94			63
Acquired EBITDA, net of disposed EBITDA (d)		9			1			3
Pro forma expense savings related to acquisitions (e)		2			—			—
Loss on extinguishment of debt (f)		58			3			82

Adjusted EBITDA—senior secured credit facilities, senior notes due 2018 and 2020 and senior subordinated notes due 2019	$	1,257		$	1,231		$	1,245

	2009			2010			2011
Loss from continuing operations	$	(1,185	)	$	(414	)	$	(73	)
Interest expense, net		630			636			521
Income tax benefit		(116	)		(68	)		(118	)
Depreciation and amortization		771			729			710
EBITDA		100			883			1,040
Goodwill impairment charges		1,126			205			48
Purchase accounting adjustments (a)		17			13			11
Non-cash charges (b)		33			36			34
Restructuring and other charges (c)		37			56			99
Acquired EBITDA, net of disposed EBITDA (d)		4			7			—
Pro forma expense savings related to acquisitions (e)		4			2			—
Loss on extinguishment of debt (f)		—			58			3
Adjusted EBITDA from continuing operations		1,321			1,260			1,235
Adjusted EBITDA from Operations Held for Sale		163			147			138
Adjusted EBITDA—senior secured credit facilities, senior notes due 2015, 2018 and 2020 and senior subordinated notes due 2015	$	1,484		$	1,407		$	1,373

(a)	Purchase accounting adjustments include the adjustment of deferred revenue and lease reserves to fair value at the dates of the LBO and subsequent acquisitions made by SunGard and certain acquisition-related compensation expense.

(b)	Non-cash charges include stock-based compensation (see Note 9 of Notes to Consolidated Financial Statements) and loss on the sale of assets.

(c)

Restructuring and other charges include severance and related payroll taxes, reserves to consolidate certain facilities, strategic initiative expenses, certain other expenses associated with acquisitions made by the Company, gains or losses related to fluctuation of foreign currency exchange rates impacting the foreign-denominated debt, management fees paid to the Sponsors, and franchise and similar taxes reported in operating expenses, partially offset by certain charges relating to the receivables facility.

(d)	Acquired EBITDA net of disposed EBITDA reflects the EBITDA impact of businesses that were acquired or disposed of during the period as if the acquisition or disposition occurred at the beginning of the period.

(e)	Pro forma adjustments represent the full-year impact of savings resulting from post-acquisition integration activities.

(f) Loss on extinguishment of debt includes in 2010 the loss on extinguishment of $1.6 billion of senior notes due in 2013 and the write-off of deferred financing fees related to the refinancing of a portion of our U.S. Dollar-denominated term loans and retirement of $100 million of pound Sterling-denominated term loans. Loss on extinguishment of debt includes in 2012 the write-off of deferred financing fees associated with the January 2012 repayment of $1.22 billion of our US$-denominated term loans, the April 2012 retirement of $500 million, 10.625% senior notes due 2015, the December 2012 retirement of $1 billion, 10.25% senior subordinated notes due 2015 and the December 2012 repayment of $217 million of US$-denominated term loans.

~~Our~~46 ~~covenant requirements and actual ratios for the year ended December 31, 2011 are as follows:~~

	CovenantRequirements		Actual Ratios
Senior secured credit facilities (1)
Minimum Adjusted EBITDA to consolidated interest expense ratio		1.95x		2.93x
Maximum total debt to Adjusted EBITDA		5.75x		4.96x
Senior notes due 2015, 2018 and 2020 and senior subordinated notes due 2015 (2)
Minimum Adjusted EBITDA to fixed charges ratio required to incur additional debt pursuant to ratio provisions		2.00x		2.91x

(1) Our senior secured credit facilities require us to maintain an Adjusted EBITDA to consolidated interest expense ratio starting at a minimum of 1.95x for the four-quarter period ended December 31, 2011 and increasing over time to 2.10x by the end of 2012 and 2.20x by the end of 2013. Consolidated interest expense is defined in the senior secured credit facilities as consolidated cash interest expense less cash interest income further adjusted for certain non-cash or non-recurring interest expense and the elimination of interest expense and fees associated with SunGard’s accounts receivable facility. Beginning with the four-quarter period ending December 31, 2011, we are required to maintain a consolidated total debt to Adjusted EBITDA ratio of 5.75x and decreasing over time to 5.25x by the end of 2012 and to 4.75x by the end of 2013. Consolidated total debt is defined in the senior secured credit facilities as total debt less certain indebtedness and further adjusted for cash and cash equivalents on our balance sheet in excess of $50 million. Failure to satisfy these ratio requirements would constitute a default under the senior secured credit facilities. If our lenders failed to waive any such default, our repayment obligations under the senior secured credit facilities could be accelerated, which would also constitute a default under our indentures.

(2) Our ability to incur additional debt and make certain restricted payments under our indentures, subject to specified exceptions, is tied to an Adjusted EBITDA to fixed charges ratio of at least 2.0x, except that we may incur certain debt and make certain restricted payments and certain permitted investments without regard to the ratio, such as our ability to incur up to an aggregate principal amount of $5.75 billion under credit facilities (inclusive of amounts outstanding under our senior credit facilities from time to time; as of December 31, 2011, we had $4.27 billion outstanding under our term loan facilities and available commitments of $858 million under our revolving credit facility), to acquire persons engaged in a similar business that become restricted subsidiaries and to make other investments equal to 6% of our consolidated assets. Fixed charges is defined in the indentures governing the Senior Notes due 2015, 2018 and 2020 and the Senior Subordinated Notes due 2015 as consolidated interest expense less interest income, adjusted for acquisitions, and further adjusted for non-cash interest and the elimination of interest expense and fees associated with the accounts receivable facility.

~~Item~~Our ~~7A.~~covenant ~~QUANTITATIVE~~requirements ~~AND~~and ~~QUALITATIVE~~actual ~~DISCLOSURES~~ratios ~~ABOUT~~for ~~MARKET~~the ~~RISK~~year ended December 31, 2012 are as follows:


	Covenant Requirements		Actual Ratios
Senior secured credit facilities ⁽¹⁾
Minimum Adjusted EBITDA to consolidated interest expense ratio		2.10x		3.53x
Maximum total debt to Adjusted EBITDA		5.75x		4.75x
Senior notes due 2018 and 2020 and senior subordinated notes due 2019 ⁽²⁾
Minimum Adjusted EBITDA to fixed charges ratio required to incur additional debt pursuant to ratio provisions		2.00x		3.51x

(1)

Our senior secured credit facility requires us to maintain an Adjusted EBITDA to consolidated interest expense ratio starting at a minimum of 2.10x for the four-quarter period ended December 31, 2012 and increasing to 2.20x at the end of 2013. Consolidated interest expense is defined in the senior secured credit facilities as consolidated cash interest expense less cash interest income further adjusted for certain non-cash or non-recurring interest expense and the elimination of interest expense and fees associated with SunGard’s accounts receivable facility. Beginning with the four-quarter period ending December 31, 2011, we are required to maintain a consolidated total debt to Adjusted EBITDA ratio of 5.75x and decreasing over time to 5.50x by June 30, 2015, 5.25x by June 30, 2016 and to 4.75x by March 31, 2017. Consolidated total debt is defined in the senior secured credit facilities as total debt less certain indebtedness and further adjusted for cash and cash equivalents on our balance sheet in excess of $50 million. Failure to satisfy these ratio requirements would constitute a default under the senior secured credit facilities. If our lenders failed to waive any such default, our repayment obligations under the senior secured credit facilities could be accelerated, which would also constitute a default under our indentures.

(2)

Our ability to incur additional debt and make certain restricted payments under our indentures, subject to specified exceptions, is tied to an Adjusted EBITDA to fixed charges ratio of at least 2.0x, except that we may incur certain debt and make certain restricted payments and certain permitted investments without regard to the ratio. This exception includes our ability to incur up to an aggregate principal amount of $5.75 billion under credit facilities (inclusive of amounts outstanding under our senior credit facilities from time to time. As of December 31, 2012, we had $3.55 billion outstanding under our term loan facilities and available commitments of $857 million under our revolving credit facility), to acquire persons engaged in a similar business that become restricted subsidiaries and to make other investments equal to 6% of our consolidated assets. Fixed charges is defined in the indentures governing the Senior Notes due 2018 and 2020 and the Senior Subordinated Notes due 2019 as consolidated interest expense less interest income, adjusted for acquisitions, and further adjusted for non-cash interest and the elimination of interest expense and fees associated with the accounts receivable facility.

ITEM 7A.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK:

We do not use derivative financial instruments for trading or speculative purposes. We have invested our available cash in short-term, highly liquid financial instruments, substantially all having initial maturities of three months or less. When necessary, we have borrowed to fund acquisitions.

At December 31, ~~2011~~2012, we had total debt of $76.8366 billion, including $43.4780 billion of variable rate debt. We entered into interest rate swap agreements which fixed the interest rates for $~~1.7~~900 ~~billion~~million of our variable rate debt. Swap agreements expiring in ~~February~~May ~~2012~~2013 have a notional value of $~~1.2~~500 ~~billion~~million and effectively fix the variable portion of our interest rates at 1.7899%. ~~Swap~~ Swap agreements expiring in ~~May~~February ~~2013~~2017 ~~have~~with a notional value of $~~500~~400 million ~~and~~ effectively fix ~~the variable portion of~~ our interest rates at 10.9969%. Our remaining variable rate debt of $2.7790 billion is subject to changes in underlying interest rates, and, accordingly, our interest payments will fluctuate. During the period when all of our interest rate swap agreements are effective, a 1% change in interest rates would result in a change in interest of approximately $28 million per year. Upon the expiration of each interest rate swap agreement in February 2012 and May 2013, a 1% change in interest rates would result in a change in interest of approximately $40 million and $45 million per year, respectively. See Note 5 of Notes to Consolidated Financial Statements.

~~During~~subject ~~2011,~~to ~~approximately~~changes ~~37% of our revenue was from customers outside the United States with approximately 78% of this revenue coming from customers located~~ in ~~the~~underlying ~~United~~interest ~~Kingdom~~rates, ~~Continental Europe~~ and, ~~Canada.~~accordingly, ~~Only~~our ainterest ~~portion~~payments ofwill ~~the~~fluctuate. ~~revenue~~During ~~from customers outside~~ the ~~United~~period ~~States~~when isall ~~denominated in other currencies, the majority being pounds sterling and euros. Revenue and expenses~~ of our ~~foreign~~interest ~~operations~~rate ~~are~~swap ~~generally~~agreements ~~denominated~~are ineffective, ~~their~~a ~~respective~~1% ~~local~~change ~~currencies.~~in interest ~~We continue to monitor our exposure to currency exchange~~ rates ~~and~~would weresult ~~enter~~in ~~into~~a ~~currency hedging transactions from time to time to mitigate certain currency exposures.~~

5447

change in interest of approximately $29 million per year. Upon the expiration of the $500 million interest rate swap agreement in May 2013, a 1% change in interest rates would result in an incremental change in interest of approximately $5 million per year, or a total of $34 million. Upon the expiration of the $400 million interest rate swap agreement in February 2017, a 1% change in interest rates would result in an incremental change in interest of approximately $4 million, or a total of $38 million. See Note 5 of Notes to Consolidated Financial Statements.

During 2012, approximately 36% of our revenue was from customers outside the United States with approximately 76% of this revenue coming from customers located in the United Kingdom, Continental Europe and Canada. Only a portion of the revenue from customers outside the United States is denominated in other currencies, the majority being pound Sterling and Euros. Revenue and expenses of our foreign operations are generally denominated in their respective local currencies. We continue to monitor our exposure to currency exchange rates and we enter into currency hedging transactions from time to time to mitigate certain currency exposures.

ITEM 8.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

SunGard Capital Corp.

SunGard Capital Corp. II

SunGard Data Systems Inc.

Index to Consolidated Financial Statements

Reports of Independent Registered Public Accounting Firm			5650
SunGard Capital Corp.
Consolidated Balance Sheets			5953
Consolidated Statements of Comprehensive Income			6054
Consolidated Statements of Cash Flows			6155
Consolidated Statement of Changes in Equity			6256
SunGard Capital Corp. II
Consolidated Balance Sheets			6458
Consolidated Statements of Comprehensive Income			6559
Consolidated Statements of Cash Flows			6660
Consolidated Statement of Changes in Stockholders’ Equity			6761
SunGard Data Systems Inc.
Consolidated Balance Sheets			6963
Consolidated Statements of Comprehensive Income			7064
Consolidated Statements of Cash Flows			7165
Consolidated Statement of Changes in Stockholder’s Equity			7266
Notes to Consolidated Financial Statements			7367

~~Reports~~Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of SunGard Capital Corp.:

In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of comprehensive income, of changes in equity and of cash flows present fairly, in all material respects, the financial position of SunGard Capital Corp. and its subsidiaries ~~(“the Company”)~~ at December 31, ~~2011~~2012 and ~~2010~~2011, and the results of their operations and their cash flows for each of the three years in the period ended December 31, ~~2011~~2012 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company ~~did not maintain~~maintained, in all material respects, effective internal control over financial reporting as of December 31, ~~2011~~2012, based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) ~~because a material weakness in internal control over financial reporting related to deferred income tax accounting existed as of that date~~. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis. The material weakness referred to above is described in Management’s Report on Internal Control Over Financial Reporting appearing under Item 9A. We considered this material weakness in determining the nature, timing, and extent of audit tests applied in our audit of the 2011 consolidated financial statements and our opinion regarding the effectiveness of the Company’s ~~internal control over financial reporting does not affect our opinion on those consolidated financial statements. The Company’s~~ management is responsible for these financial statements, for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in ~~management~~Management’s Report ~~report~~on ~~referred~~Internal toControl ~~above~~Over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on these financial statements and on the Company’s internal control over financial reporting based on our integrated audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ PricewaterhouseCoopers LLP

Philadelphia, Pennsylvania

March 1620, ~~2012~~ 2013

5650

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of SunGard Capital Corp. II:

In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of comprehensive income, of changes in stockholders’ equity and of cash flows present fairly, in all material respects, the financial position of SunGard Capital Corp. II and its subsidiaries ~~(“the Company”)~~ at December 31, ~~2011~~2012 and ~~2010~~2011, and the results of their operations and their cash flows for each of the three years in the period ended December 31, ~~2011~~2012 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company ~~did not maintain~~maintained, in all material respects, effective internal control over financial reporting as of of December 31, ~~2011~~2012, based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) ~~because a material weakness in internal control over financial reporting related to deferred income tax accounting existed as of that date~~. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis. The material weakness referred to above is described in Management’s Report on Internal Control Over Financial Reporting appearing under Item 9A. We considered this material weakness in determining the nature, timing, and extent of audit tests applied in our audit of the 2011 consolidated financial statements and our opinion regarding the effectiveness of the Company’s ~~internal control over financial reporting does not affect our opinion on those consolidated financial statements. The Company’s~~ management is responsible for these financial statements, for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in ~~management~~Management’s ~~report~~Report ~~referred~~on toInternal ~~above~~Control Over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on these financial statements and on the Company’s internal control over financial reporting based on our integrated audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

/s/ PricewaterhouseCoopers LLP

Philadelphia, Pennsylvania

March 1620, ~~2012~~2013

5751

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholder of SunGard Data Systems Inc.:

In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of comprehensive income, of changes in stockholder’s equity and of cash flows present fairly, in all material respects, the financial position of SunGard Data Systems Inc. and its subsidiaries ~~(“the Company”)~~ at December 31, ~~2011~~2012 and ~~2010~~2011, and the results of their operations and their cash flows for each of the three years in the period ended December 31, ~~2011~~2012 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company ~~did not maintain~~maintained, in all material respects, effective internal control over financial reporting as of December 31, ~~2011~~2012, based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) ~~because a material weakness in internal control over financial reporting related to deferred income tax accounting existed as of that date~~. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis. The material weakness referred to above is described in Management’s Report on Internal Control Over Financial Reporting appearing under Item 9A. We considered this material weakness in determining the nature, timing, and extent of audit tests applied in our audit of the 2011 consolidated financial statements and our opinion regarding the effectiveness of the Company’s ~~internal control over financial reporting does not affect our opinion on those consolidated financial statements. The Company’s~~ management is responsible for these financial statements, for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in ~~management~~Management’s ~~report~~Report ~~referred~~on toInternal ~~above~~Control Over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on these financial statements and on the Company’s internal control over financial reporting based on our integrated audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

/s/ PricewaterhouseCoopers LLP

Philadelphia, Pennsylvania

March 1620, ~~2012~~ 2013

5852

SunGard Capital Corp.

Consolidated Balance Sheets

(In millions except share and per-share amounts)	December 31,2010			December 31,2011
Assets
Current:
Cash and cash equivalents	$	771		$	868
Trade receivables, net of allowance for doubtful accounts of $37 and $38		833			802
Earned but unbilled receivables		135			149
Prepaid expenses and other current assets		166			117
Clearing broker assets		230			213
Deferred income taxes		7			—
Assets held for sale		1,339			1,326
Total current assets		3,481			3,475
Property and equipment, less accumulated depreciation of $1,109 and $1,296		892			893
Software products, less accumulated amortization of $1,203 and $1,431		723			554
Customer base, less accumulated amortization of $1,049 and $1,269		1,806			1,580
Other intangible assets, less accumulated amortization of $23 and $22		187			144
Trade name, less accumulated amortization of $7 and $10		1,023			1,019
Goodwill		4,856			4,885
Total Assets	$	12,968		$	12,550
Liabilities and Equity
Current:
Short-term and current portion of long-term debt	$	9		$	10
Accounts payable		63			60
Accrued compensation and benefits		284			300
Accrued interest expense		103			92
Other accrued expenses		406			341
Clearing broker liabilities		210			179
Deferred revenue		887			862
Deferred income taxes		—			76
Liabilities related to assets held for sale		246			230
Total current liabilities		2,208			2,150
Long-term debt		8,046			7,819
Deferred income taxes		1,110			1,125
Total liabilities		11,364			11,094
Commitments and contingencies
Noncontrolling interest in preferred stock of SCCII subject to a put option		54			28
Class L common stock subject to a put option		87			47
Class A common stock subject to a put option		11			6
Stockholders’ equity:
Class L common stock, convertible, par value $.001 per share; cumulative 13.5% per annum, compounded quarterly; aggregate liquidation preference of $4,699 million and $5,383 million; 50,000,000 shares authorized, 28,670,331 and 28,842,773 shares issued		—			—
Class A common stock, par value $.001 per share; 550,000,000 shares authorized, 258,037,523 and 259,589,718 shares issued		—			—
Capital in excess of par value		2,703			2,768
Treasury stock, 326,329 and 387,638 shares of Class L common stock; and 2,940,981 and 3,492,925 shares of Class A common stock		(34	)		(39	)
Accumulated deficit		(2,970	)		(3,346	)
Accumulated other comprehensive income (loss)		(29	)		(46	)
Total SunGard Capital Corp. stockholders’ equity (deficit)		(330	)		(663	)
Noncontrolling interest in preferred stock of SCCII		1,782			2,038
Total equity		1,452			1,375
Total Liabilities and Equity	$	12,968		$	12,550

(In millions except share and per-share amounts)


	December 31, 2011			December 31, 2012
*Assets*
Current:
Cash and cash equivalents	$	867		$	546
Trade receivables, less allowance for doubtful accounts of $38 and $30		794			781
Earned but unbilled receivables		140			119
Prepaid expenses and other current assets		117			224
Clearing broker assets		213			6
Assets related to discontinued operations		1,350			—

Total current assets		3,481			1,676
Property and equipment, less accumulated depreciation of $1,296 and $1,509		893			874
Software products, less accumulated amortization of $1,431 and $1,649		554			411
Customer base, less accumulated amortization of $1,254 and $1,481		1,574			1,367
Other assets, less accumulated amortization of $22 and $27		144			132
Trade name		1,019			1,019
Goodwill		4,885			4,539

Total Assets	$	12,550		$	10,018

*Liabilities and Equity*
Current:
Short-term and current portion of long-term debt	$	10		$	63
Accounts payable		59			32
Accrued compensation and benefits		291			297
Accrued interest expense		92			41
Other accrued expenses		261			234
Clearing broker liabilities		179			4
Deferred revenue		862			836
Deferred income taxes		76			—
Liabilities related to discontinued operations		246			—

Total current liabilities		2,076			1,507
Long-term debt		7,819			6,599
Deferred and other income taxes		1,123			1,127
Other long-term liabilities		76			95

Total liabilities		11,094			9,328

Commitments and contingencies
Noncontrolling interest in preferred stock of SCCII subject to a put option		28			26
Class L common stock subject to a put option		47			45
Class A common stock subject to a put option		6			5
Stockholders’ equity:
Class L common stock, convertible, par value $.001 per share; cumulative 13.5% per annum, compounded quarterly; aggregate liquidation preference of $5,383 million and $6,154 million; 50,000,000 shares authorized, 28,842,773 and 29,027,610 shares issued		—			—
Class A common stock, par value $.001 per share; 550,000,000 shares authorized, 259,589,718 and 261,251,822 shares issued		—			—
Capital in excess of par value		2,768			2,483
Treasury stock, 387,638 and 541,886 shares of Class L common stock; and 3,492,925 and 4,880,305 shares of Class A common stock		(39	)		(50	)
Accumulated deficit		(3,346	)		(3,391	)
Accumulated other comprehensive income (loss)		(46	)		(3	)

Total SunGard Capital Corp. stockholders’ equity (deficit)		(663	)		(961	)
Noncontrolling interest in preferred stock of SCCII		2,038			1,575

Total equity		1,375			614

Total Liabilities and Equity	$	12,550		$	10,018

The accompanying notes are an integral part of these consolidated financial statements.

5953

SunGard Capital Corp.

Consolidated Statements of Comprehensive Income

	Year ended December 31,
(In millions)	2009			2010			2011
Revenue:
Services	$	4,405		$	4,075		$	4,114
License and resale fees		245			295			289
Total products and services		4,650			4,370			4,403
Reimbursed expenses		156			120			96
		4,806			4,490			4,499
Costs and expenses:
Cost of sales and direct operating		2,249			1,937			1,891
Sales, marketing and administration		992			1,042			1,095
Product development and maintenance		354			372			422
Depreciation and amortization		275			278			272
Amortization of acquisition-related intangible assets		496			451			438
Goodwill impairment charges		1,126			205			48
		5,492			4,285			4,166
Operating income (loss)		(686	)		205			333
Interest income		7			2			3
Interest expense and amortization of deferred financing fees		(637	)		(638	)		(524	)
Loss on extinguishment of debt		—			(58	)		(3	)
Other income (expense)		15			7			—
Income (loss) from continuing operations before income taxes		(1,301	)		(482	)		(191	)
Benefit from (provision for) income taxes		117			68			116
Income (loss) from continuing operations		(1,184	)		(414	)		(75	)
Income (loss) from discontinued operations, net of tax		67			(156	)		(76	)
Net income (loss)		(1,117	)		(570	)		(151	)
Income attributable to the noncontrolling interest (including $5 million, $3 million and $– million in temporary equity)		(180	)		(191	)		(225	)
Net income (loss) attributable to SunGard Capital Corp.		(1,297	)		(761	)		(376	)
Other Comprehensive income (loss):
Foreign currency translation		80			(41	)		(26	)
Less: foreign currency translation reclassified into income		—			109			—
Foreign currency translation, net		80			68			(26	)
Unrealized gain (loss) on derivative instruments		(51	)		(49	)		(16	)
Less: gain (loss) on derivatives reclassified into income		80			85			34
Less: income tax benefit (expense)		(11	)		(12	)		(9	)
Net unrealized gain (loss) on derivative instruments, net of tax		18			24			9
Comprehensive income (loss) attributable to SunGard Capital Corp.	$	(1,199	)	$	(669	)	$	(393	)

(In millions)


	Year ended December 31,
	2010			2011			2012
Revenue:
Services	$	4,024		$	4,056		$	3,926
License and resale fees		294			289			275

Total products and services		4,318			4,345			4,201
Reimbursed expenses		119			95			62

Total revenue		4,437			4,440			4,263

Costs and expenses:
Cost of sales and direct operating (excluding depreciation)		1,895			1,848			1,740
Sales, marketing and administration		1,057			1,108			1,039
Product development and maintenance		350			393			353
Depreciation and amortization		278			271			287
Amortization of acquisition-related intangible assets		448			435			385
Goodwill impairment charges		205			48			385

Total costs and expenses		4,233			4,103			4,189

Operating income (loss)		204			337			74
Interest income		2			3			1
Interest expense and amortization of deferred financing fees		(638	)		(524	)		(428	)
Loss on extinguishment of debt		(58	)		(3	)		(82	)
Other income (expense)		7			—			—

Income (loss) from continuing operations before income taxes		(483	)		(187	)		(435	)
Benefit from (provision for) income taxes		69			116			38

Income (loss) from continuing operations		(414	)		(71	)		(397	)
Income (loss) from discontinued operations, net of tax		(156	)		(80	)		331

Net income (loss)		(570	)		(151	)		(66	)
Income attributable to the noncontrolling interest (including $3 million, $- million and $1 million in temporary equity)		(191	)		(225	)		(251	)

Net income (loss) attributable to SunGard Capital Corp.		(761	)		(376	)		(317	)


Other comprehensive income (loss):
Foreign currency translation		(41	)		(26	)		33
Less: foreign currency translation reclassified into income		109			—			—

Foreign currency translation, net		68			(26	)		33

Unrealized gain (loss) on derivative instruments		(49	)		(16	)		(1	)
Less: gain (loss) on derivatives reclassified into income		85			34			14
Less: income tax benefit (expense)		(12	)		(9	)		(3	)

Net unrealized gain (loss) on derivative instruments, net of tax		24			9			10

Other comprehensive income (loss), net of tax		92			(17	)		43


Comprehensive income (loss)		(478	)		(168	)		(23	)
Comprehensive income (loss) attributable to the non controlling interest		(191	)		(225	)		(251	)

Comprehensive income (loss) attributable to SunGard Capital Corp.	$	(669	)	$	(393	)	$	(274	)

The accompanying notes are an integral part of these consolidated financial statements.

6054

SunGard Capital Corp.

Consolidated Statements of Cash Flows

	Year ended December 31,
(In millions)	2009			2010			2011
Cash flow from operations:
Net income (loss)	$	(1,117	)	$	(570	)	$	(151	)
Income (loss) from discontinued operations		67			(156	)		(76	)
Income (loss) from continuing operations		(1,184	)		(414	)		(75	)
Reconciliation of income (loss) from continuing operations to cash flow from (used in) operations:
Depreciation and amortization		771			729			710
Goodwill impairment charge		1,126			205			48
Deferred income tax provision (benefit)		(157	)		(83	)		(157	)
Stock compensation expense		31			29			33
Amortization of deferred financing costs and debt discount		42			43			40
Loss on extinguishment of debt		—			58			3
Other non-cash items		(14	)		3			2
Accounts receivable and other current assets		(15	)		22			73
Accounts payable and accrued expenses		(73	)		29			(35	)
Clearing broker assets and liabilities, net		(39	)		18			(14	)
Deferred revenue		62			(36	)		(26	)
Cash flow from (used in) continuing operations		550			603			602
Cash flow from (used in) discontinued operations		90			118			76
Cash flow from (used in) operations		640			721			678
Investment activities:
Cash paid for acquired businesses, net of cash acquired		(13	)		(82	)		(35	)
Cash paid for property and equipment and software		(315	)		(298	)		(276	)
Other investing activities		5			4			(4	)
Cash provided by (used in) continuing operations		(323	)		(376	)		(315	)
Cash provided by (used in) discontinued operations		(10	)		116			(11	)
Cash provided by (used in) investment activities		(333	)		(260	)		(326	)
Financing activities:
Cash received from issuance of common stock		4			1			3
Cash received from issuance of preferred stock		1			—			3
Cash received from borrowings, net of fees		202			1,633			1
Cash used to repay debt		(825	)		(1,924	)		(239	)
Premium paid to retire debt		—			(41	)		—
Cash used to purchase treasury stock		(6	)		(12	)		(9	)
Other financing activities		(3	)		(1	)		(12	)
Cash provided by (used in) continuing operations		(627	)		(344	)		(253	)
Cash provided by (used in) discontinued operations		(2	)		—			—
Cash provided by (used in) financing activities		(629	)		(344	)		(253	)
Effect of exchange rate changes on cash		11			(3	)		(4	)
Increase (decrease) in cash and cash equivalents		(311	)		114			95
Beginning cash and cash equivalents includes cash of discontinued operations:2009, $12; 2010, $27; 2011, $7		975			664			778
Ending cash and cash equivalents includes cash of discontinued operations:2009, $27; 2010, $7; 2011, $5	$	664		$	778		$	873

(In millions)


	Year ended December 31,
	2010			2011			2012
*Cash flow from operations:*
Net income (loss)	$	(570	)	$	(151	)	$	(66	)
Income (loss) from discontinued operations		(156	)		(80	)		331

Income (loss) from continuing operations		(414	)		(71	)		(397	)
Reconciliation of income (loss) from continuing operations to cash flow from (used in) operations:
Depreciation and amortization		726			706			672
Goodwill impairment charge		205			48			385
Deferred income tax provision (benefit)		(83	)		(155	)		(79	)
Stock compensation expense		29			33			38
Amortization of deferred financing costs and debt discount		43			40			36
Loss on extinguishment of debt		58			3			82
Other noncash items		3			2			(1	)
Accounts receivable and other current assets		25			75			51
Accounts payable and accrued expenses		27			(35	)		(129	)
Clearing broker assets and liabilities, net		18			(14	)		33
Deferred revenue		(36	)		(26	)		(46	)

Cash flow from (used in) continuing operations		601			606			645
Cash flow from (used in) discontinued operations		120			72			(401	)

Cash flow from (used in) operations		721			678			244

*Investment activities:*
Cash paid for acquired businesses, net of cash acquired		(82	)		(35	)		(40	)
Cash paid for property and equipment and software		(298	)		(276	)		(260	)
Other investing activities		4			(4	)		3

Cash provided by (used in) continuing operations		(376	)		(315	)		(297	)
Cash provided by (used in) discontinued operations		116			(11	)		1,758

Cash provided by (used in) investment activities		(260	)		(326	)		1,461

*Financing activities:*
Cash received from issuance of common stock		1			3			—
Cash received from issuance of preferred stock		—			3			—
Cash received from borrowings, net of fees		1,633			1			1,715
Cash used to repay debt		(1,924	)		(239	)		(2,946	)
Premium paid to retire debt		(41	)		—			(48	)
Dividends paid		—			—			(724	)
Cash used to purchase treasury stock		(12	)		(9	)		(22	)
Other financing activities		(1	)		(12	)		(14	)

Cash provided by (used in) continuing operations		(344	)		(253	)		(2,039	)
Cash provided by (used in) discontinued operations		—			—			—

Cash provided by (used in) financing activities		(344	)		(253	)		(2,039	)

Effect of exchange rate changes on cash		(3	)		(4	)		7

Increase (decrease) in cash and cash equivalents		114			95			(327	)
Beginning cash and cash equivalents includes cash of discontinued operations: 2010,
$33; 2011, $23; 2012, $6		664			778			873

Ending cash and cash equivalents includes cash of discontinued operations: 2010,
$23; 2011, $6; 2012, $-	$	778		$	873		$	546

The accompanying notes are an integral part of these consolidated financial statements.

6155

SunGard Capital Corp.

Consolidated Statement of Changes in Equity

	Common Stock									Treasury Stock
							Capital inExcess of ParValue			Common Stock
	Number ofShares issued				ParValue					Shares				ParValue
(In millions)	Class L		Class A							Class L		Class A				Amount
Balances at December 31, 2008		29		256	$	—	$	2,613			—		2	$	—	$	(24	)
Net income (loss)		—		—		—		—			—		—		—		—
Foreign currency translation		—		—		—		—			—		—		—		—
Net unrealized gain on derivative instruments (net of tax provision of $11)		—		—		—		—			—		—		—		—
Stock compensation expense		—		—		—		33			—		—		—		—
Issuance of common and preferred stock		—		2		—		(1	)		—		—		—		—
Purchase of treasury stock		—		—		—		—			—		—		—		(3	)
Expiration of put option		—		—		—		44			—		—		—		—
Transfer intrinsic value of vested restricted stock units to temporary equity		—		—		—		(9	)		—		—		—		—
Other		—		—		—		(2	)		—		—		—		—
Balances at December 31, 2009		29		258		—		2,678			—		2		—		(27	)
Net income (loss)		—		—		—		—			—		—		—		—
Foreign currency translation including the impact of the sale of a business of $109		—		—		—		—			—		—		—		—
Net unrealized gain on derivative instruments (net of tax provision of $12)		—		—		—		—			—		—		—		—
Stock compensation expense		—		—		—		31			—		—		—		—
Issuance of common and preferred stock		—		—		—		1			—		—		—		—
Purchase of treasury stock		—		—		—		(1	)		—		1		—		(7	)
Expiration of put option		—		—		—		10			—		—		—		—
Transfer intrinsic value of vested restricted stock units to temporary equity		—		—		—		(13	)		—		—		—		—
Other		—		—		—		(3	)		—		—		—		—
Balances at December 31, 2010		29		258		—		2,703			—		3		—		(34	)
Net income (loss)		—		—		—		—			—		—		—		—
Foreign currency translation		—		—		—		—			—		—		—		—
Net unrealized gain on derivative instruments (net of tax provision of $9)		—		—		—		—			—		—		—		—
Stock compensation expense		—		—		—		35			—		—		—		—
Issuance of common and preferred stock		—		2		—		6			—		—		—		—
Purchase of treasury stock		—		—		—		(1	)		—		—		—		(5	)
Expiration of put option		—		—		—		58			—		—		—		—
Transfer intrinsic value of vested restricted stock units to temporary equity		—		—		—		(21	)		—		—		—		—
Other		—		—		—		(12	)		—		—		—		—
Balances at December 31, 2011		29		260	$	—	$	2,768			—		3	$	—	$	(39	)

(In millions)


										Permanent Equity
	Temporary Equity																		Treasury Stock
	Subject to a put option									Common Stock									Common Stock
							Noncontrolling Interest			Number of Shares issued				Par Value		Capital in Excess of Par Value			Shares				Par Value
	Class L			Class A			Noncontrolling Interest			Class L		Class A		Par Value		Capital in Excess of Par Value			Class L		Class A		Par Value		Amount
Balances at December 31, 2009	$	88		$	11		$	51			29		258	$	—	$	2,678			—		2	$	—	$	(27	)
Net income (loss)		—			—			3			—		—		—		—			—		—		—		—
Foreign currency translation including the impact of the sale of a business of $109		—			—			—			—		—		—		—			—		—		—		—
Net unrealized gain on derivative instruments (net of tax expense of $12)		—			—			—			—		—		—		—			—		—		—		—
Stock compensation expense		—			—			—			—		—		—		31			—		—		—		—
Issuance of common and preferred stock		(1	)		—			—			—		—		—		1			—		—		—		—
Purchase of treasury stock		—			—			—			—		—		—		(1	)		—		1		—		(7	)
Expiration of put option		(8	)		(1	)		(4	)		—		—		—		10			—		—		—		—
Transfer intrinsic value of vested restricted stock units to temporary equity		8			1			4			—		—		—		(13	)		—		—		—		—
Other		—			—			—			—		—		—		(3	)		—		—		—		—

Balances at December 31, 2010		87			11			54			29		258		—		2,703			—		3		—		(34	)
Net income (loss)		—			—			—			—		—		—		—

Filing Compare · SUNGARD DATA SYSTEMS INC