Note 19.

Planned Spin-off

On February 10, 2015, we announced plans to spin-off our vacation ownership business to stockholders as a separate publicly traded company, Vistana Signature Experiences, Inc. The transaction, which is expected to be tax-free to stockholders, will be effected through a pro rata distribution of the new entity’s stock to existing Starwood stockholders. We expect to enter into a new long-term license agreement with the new entity for current and future vacation ownership properties to retain affiliation with our globally-renowned Westin and Sheraton brands. In addition to the existing 23 vacation ownership resorts, we expect to transfer to the new entity five owned properties in Hawaii, Colorado, and Mexico for future vacation ownership development. We have disclosed additional details of the transaction in the Form 10 registration statement filed with the Securities and Exchange Commission in the second quarter of 2015. The Form 10 will include details about the new entity’s pro forma balance sheet and pro forma income statement. During the three and six months ended June 30, 2015, we recorded approximately $10 million and $16 million of costs, respectively, primarily associated with professional fees for the planned spin-off. The transaction is subject to the receipt of normal and customary regulatory approvals, the execution of inter-company agreements, arrangement of adequate financing facilities, the effectiveness of the registration statement, final approval by Starwood’s Board of Directors, and other customary conditions. The spin-off transaction will not require a stockholder vote. The spin-off is expected to be completed in the fourth quarter of 2015, but there can be no assurance regarding the ultimate timing of the spin-off or that the spin-off will ultimately occur.