Starwood 2015 Annual Report Download - page 9

Table of Contents
Executive Summary
Executive Officer Transitions
On February 13, 2015, Mr. van Paasschen resigned as our President and Chief Executive Officer and as a member of our Board. One day later, on February 14,
2015, Mr. Aron was appointed as our Chief Executive Officer on an interim basis, and he served in this position until his resignation became effective
December 30, 2015. Effective December 31, 2015, Mr. Mangas, who served as our Chief Financial Officer until December 30, 2015, was appointed as our new
Chief Executive Officer. Mr. Schnaid was appointed to succeed Mr. Mangas as our Chief Financial Officer effective December 31, 2015. As a result of these
transitions, our CD&A and the related compensation tables and narratives cover seven named executive officers for 2015 and analyze a variety of compensation
decisions and actions, some of which were made specifically as a result of these transition events.
Not all of our named executive officers participated in, or received, all of the compensation elements described in this CD&A. For example, Mr. van Paasschen did
not participate in many of our standard compensation programs due to his departure relatively early in 2015, and Mr. Aron did not participate in all of the same
programs in which most of our other named executive officers participated in 2015 due to his interim status during his employment with us. When discussing each
compensation element in this CD&A, we will explain the degree to which each named executive officer participated in, or was eligible for, each standard or non-
standard executive compensation program in effect during 2015.
Our Business
Starwood is one of the largest hotel and leisure companies in the world. We are a fully integrated owner, operator and franchisor of hotels, resorts and residences
under the renowned brands: St. Regis ® , The Luxury Collection ® , W ® , Westin ® , Le Méridien ® , Sheraton ® , Tribute Portfolio™, Four Points ® by Sheraton,
Aloft ® , and Element ® , as well as through a partnership with Design Hotels™. Our revenue and earnings are derived primarily from hotel operations, which
include management and other fees earned from hotels we manage pursuant to management contracts, the receipt of franchise and other fees and the operation of
our owned hotels. Our hotel business is well represented in most major markets around the world, and it emphasizes the global operation of hotels and resorts
primarily in the luxury and upper upscale segment of the lodging industry. At December 31, 2015, our hotel portfolio included 1,297 properties providing
approximately 370,000 rooms in approximately 100 countries and 188,000 employees under our management at our owned and managed properties, vacation
ownership resorts and corporate offices.
We conduct our hotel and leisure business both directly and through our subsidiaries. As of December 31, 2015, we also owned and operated a vacation ownership
business, primarily conducted through Starwood Vacation Ownership, Inc., a premier provider of world-class vacation experiences through villa-style resorts and
privileged access to Starwood brands (which we refer to as SVO). However, on October 28, 2015, we announced our entry into definitive agreements with Interval
Leisure Group, Inc., a Delaware corporation (which we refer to as ILG), Iris Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of ILG (which
we refer to as Merger Sub), and Vistana Signature Experiences, Inc., a Delaware corporation and our wholly-owned subsidiary (which we refer to as Vistana),
pursuant to which, among other things, (1) we and certain of our subsidiaries will engage in a series of transactions in which certain assets and liabilities
constituting the vacation ownership business (including SVO and five hotels to be converted to timeshare properties) not currently owned by Vistana will be
(a) sold directly to one or more subsidiaries of ILG or (b) otherwise conveyed pursuant to an internal restructuring to Vistana and entities that will become Vistana
subsidiaries, in order to separate our vacation ownership business from our other businesses, (2) immediately after such separation, we will distribute to our
stockholders on a pro rata basis all of the issued and outstanding shares of common stock, par value $0.01 per share, of Vistana held by us (which distribution we
refer to as the Spin-Off), and (3) immediately after the Spin-Off, Vistana will merge with Merger Sub, with Vistana continuing as the surviving company and as a
wholly-owned subsidiary of ILG. As a result of the foregoing transactions, our stockholders will own approximately 55% of the outstanding shares of ILG on a
fully-diluted basis (with the existing stockholders of ILG owning approximately 45% of ILG on a fully-diluted basis).
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