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8-K - 8-K - ILG, LLCa15-22623_18k.htm
EX-99.1 - EX-99.1 - ILG, LLCa15-22623_1ex99d1.htm

Exhibit 99.2

ILG’s Proposed Acquisition of Starwood’s Vacation Ownership Business November 9, 2015 Creating a Leading, Integrated Shared Ownership Company SUPPLEMENTAL MATERIALS

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2 Cautionary Language Concerning Forward-Looking Statements Information set forth in this communication, including financial estimates and statements as to the expected timing, completion and effects of the proposed merger between a wholly-owned subsidiary of Interval Leisure Group, Inc. (“ILG”) and Vistana Signature Experiences, Inc. (“Vistana”), which will immediately follow the proposed spin-off of Vistana from Starwood Hotels & Resorts Worldwide, Inc. (“Starwood”), constitute forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These estimates and statements are subject to risks and uncertainties, and actual results might differ materially. Such estimates and statements include, but are not limited to, statements about the benefits of the proposed merger, including future financial and operating results, the combined company’s plans, objectives, expectations and intentions, and other statements that are not historical facts. Such statements are based upon the current beliefs and expectations of the management of ILG and are subject to significant risks and uncertainties outside of ILG’s control. Among the risks and uncertainties that could cause actual results to differ from those described in the forward-looking statements are the following: (1) the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement, (2) the risk that ILG stockholders may not approve the issuance of ILG common stock in connection with the proposed merger, (3) the risk that the necessary regulatory approvals may not be obtained or may be obtained subject to conditions that are not anticipated, (4) risks that any of the closing conditions to the proposed merger, including Starwood’s spin-off of Vistana, may not be satisfied in a timely manner, (5) risks related to disruption of management time from ongoing business operations due to the proposed merger, (6) failure to realize the benefits expected from the proposed merger, (7) the effect of the announcement of the proposed merger on the ability of ILG to retain and hire key personnel and maintain relationships with its key business partners, and on its operating results and businesses generally, (8) adverse trends in economic conditions generally or in the vacation ownership, vacation rental and travel industries, or adverse events or trends in key vacation destinations, (9) adverse changes to, or interruptions in, relationships with third parties unrelated to the announcement, (10) lack of available financing for, or insolvency or consolidation of developers, (11) decreased demand from prospective purchasers of vacation interests, (12) travel related health concerns, (13) ILG’s ability to compete effectively and successfully and to add new products and services, (14) ILG’s ability to successfully manage and integrate acquisitions, (15) the occurrence of a termination event under the master license agreement with Hyatt, (16) ILG’s ability to market vacation ownership interests successfully and efficiently, (17) impairment of ILG’s assets, (18) the restrictive covenants in ILG’s revolving credit facility and indenture; (19) business interruptions in connection with ILG’s technology systems, (20) the ability of managed homeowners associations to collect sufficient maintenance fees, (21) third parties not repaying advances or extensions of credit, (22) fluctuations in currency exchange rates and (23) ILG’s ability to expand successfully in international markets and manage risks specific to international operations. Discussions of additional risks and uncertainties are contained in ILG’s filings with the U.S. Securities and Exchange Commission. ILG is not under any obligation, and each expressly disclaim any obligation, to update, alter, or otherwise revise any forward-looking statements, whether written or oral, that may be made from time to time, whether as a result of new information, future events, or otherwise. Persons reading this announcement are cautioned not to place undue reliance on these forward-looking statements which speak only as of the date hereof. Safe Harbor

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3 Additional Information and Where to Find It This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval. This communication may be deemed to be solicitation material in respect of the proposed merger between a wholly-owned subsidiary of ILG and Vistana. In connection with the proposed merger, ILG intends to file a registration statement on Form S-4, containing a proxy statement/prospectus with the Securities and Exchange Commission (“SEC”). STOCKHOLDERS OF ILG AND STARWOOD ARE URGED TO READ ALL RELEVANT DOCUMENTS FILED WITH THE SEC, INCLUDING THE PROXY STATEMENT/PROSPECTUS, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED MERGER. Investors and security holders will be able to obtain copies of the proxy statement/prospectus as well as other filings containing information about ILG, Starwood and Vistana, without charge, at the SEC’s website, http://www.sec.gov. Copies of documents filed with the SEC by ILG will be made available free of charge on ILG’s investor relations website. Copies of documents filed with the SEC by Starwood will be made available free of charge on Starwood’s investor relations website. Participants in Solicitation ILG and its directors and executive officers, and Starwood and its directors and executive officers may be deemed to be participants in the solicitation of proxies from the holders of ILG common stock in respect of ILG’s stock issuance in connection with the proposed merger. Information about the directors and executive officers of ILG is set forth in the proxy statement for ILG’s 2015 Annual Meeting of Stockholders, which was filed with the SEC on April 6, 2015. Information about the directors and executive officers of Starwood is set forth in the proxy statement for Starwood’s 2015 Annual Meeting of Stockholders, which was filed with the SEC on April 17, 2015. Investors may obtain additional information regarding the interest of such participants by reading the proxy statement/prospectus regarding the proposed merger when it becomes available. Safe Harbor

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Stronger financial profile to drive growth Leading diversified vacation ownership company with complementary product offerings Improved financial strength and flexibility Embedded growth opportunities with over $5 billion of future inventory yield Significant cost savings and revenue synergies Enhanced membership and exchange growth opportunities ILG & Vistana: A Powerful Combination 1 Derived from ILG SEC filings 2 Derived from the pro forma data in Vistana’s Form 10 filed September 22, 2015; excludes the revenues related to the residential segment. 3 Equivalent to ILG’s pass-through revenue 4 Sales of vacation ownership products Resort operations and ancillary services Cost reimbursements3 Consumer financing Resort and vacation network management Exchange & Rental Vacation Ownership ILG / $672 million1 LTM Revenues June 30, 2015 Vistana / $923 million2 Diversified & Complementary Businesses Pass-through revenue Industry-Leading Brands

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Vistana: Attractive Collection of Assets Includes: Notes: All amounts as of 9/30/15, in accordance with the basis of presentation used in Vistana’s Form 10 filed September 22, 2015. Net of allowances as of 9/30/2015 Estimated Fair Value Excludes land to be retained by Starwood $415M Unsecuritized vacation ownership notes1 Securitizations of existing and future receivables to fund future developments Recent branded securitizations have achieved >90% advance rates with interest rates of ~ 2.5% $240M Balance sheet value of inventory In villa- style resorts with high levels of owner/guest satisfaction ~$200M2 5 transferred world-class resorts Centered on proven vacation ownership markets Future development with capital-efficient inventory management with phased construction and pre-construction financing Provides new distribution points to support revenue growth ~$30M Additional land held for development3 Hawaii, Florida, Colorado, South Carolina, California, Mexico and St. John, USVI 14 Active sales centers Generated $739M of originated sales in peak sales year (2006) Strategic marketing channels deliver predictable flow of qualified guests Focus on resort guests with high propensity to tour and purchase vacation ownership products Six new distribution points expected to be added through 2018 5

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Vistana: Attractive and Growing Resort Portfolio $1.2B Completed Inventory1 $3.1B In Development & Future Phases2 $1.3B Transferred Properties2 $5.5B Future Inventory Yield Opportunity 6 Completed Inventory yield based on pricing as of year-end 2014 and includes inventory on hand, projected returns due to mortgage receivable defaults in the future as well as projected purchases through 2018 from existing third party agreements and other third party sources. Projections for “In Development and Future Phases” and “Transferred Properties” are based on inventory from build out of current active development projects and future conversion of transferred properties. Projected yield for these categories include 2% annual price growth and excludes future returns pursuant to GAAP accounting methodology. Yield projections are subject to change due to market dynamics, ongoing review of development, and operational performance within mortgage portfolio, sales and marketing and resort business lines

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Business has delivered strong performance YTD 2015 Modified Adjusted EBITDA1 for 2015 expected to be approximately $140M -$145M based on 8%-10% originated sales2 growth and ADR/occupancy growth in management and resort operations 2018 Modified Adjusted EBITDA includes $21 million in targeted synergies Vistana Signature Experiences Growth Potential Notes: All financial information (other than targeted synergies) on this slide prepared by Vistana. Financial information presented excludes any impact related to the acquisition method of accounting. Please see appendix for non-GAAP financial measures reconciliation for Modified Adjusted EBITDA. Modified Adjusted EBITDA equals Pro forma Adjusted EBITDA excluding non-cash compensation ($4M for all scenarios) and including targeted synergies in 2018. Pro forma Adjusted EBITDA is in accordance with the basis of presentation used in the Vistana Form 10 filed with September 22, 2015 and excludes the impact of the deferral adjustment associated with percentage of completion accounting guidelines reflecting its net impact on Vistana’s GAAP revenues and expenses and the operations of Starwood’s residential business, and includes the impact of pro forma adjustments related to royalty fees, management fees and credit facility fees. Originated sales represent the total amount of vacation ownership products under purchase agreements signed during the period where a down payment of at least ten percent of the contract price has been received, reduced by actual rescissions and cancellations as well as adjustments for incentives and other administrative fee revenues during the period. 7 2014 Originated Sales $323M Modified Adjusted EBITDA $116M 2015 Originated Sales $350M - $355M Modified Adjusted EBITDA $140M - $145M 2018 Originated Sales $440M - $550M Modified Adjusted EBITDA $185M - $220M

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Vistana Signature Experiences – 2018 Potential Growth Scenarios Notes: All financial information (other than targeted synergies) on this slide provided by Vistana and excludes any impact related to the acquisition method of accounting. 1 Originated sales represent the total amount of vacation ownership products under purchase agreements signed during the period where a down payment of at least ten percent of the contract price has been received, reduced by actual rescissions and cancellations as well as adjustments for incentives and other administrative fee revenues during the period. 2 Pro forma Adjusted EBITDA is in accordance with the basis of presentation used in the Vistana Form 10 filed September 22, 2015 and excludes the impact of the deferral adjustment associated with percentage of completion accounting guidelines reflecting its net impact on Vistana’s GAAP revenues and expenses, the operations of Starwood’s residential business and includes the impact of the pro-forma adjustments related to royalty fees, management fees and credit facility fees. Financial information presented excludes any impact related to the acquisition method of accounting as ILG is considered the accounting acquirer of VSE. 3 Modified Adjusted EBITDA equals Pro forma Adjusted EBITDA excluding non-cash compensation and including targeted synergies. Annualized originated sales growth scenarios 2015 Estimated Growth Case Based on the estimated growth rate between 2014 and 2015 Higher Growth Case Based on embedded inventory and expected additional distribution points Existing distribution capacity and infrastructure supports sales growth targets Historical peak sales reached $739M in 2006 Complementary growth in other segments based on historical performance Resort and Vacation Network Management increasing with growth in owner base, new development and inflation; Revenue stream is contract based, predictable and recurring Resort Operations and Ancillary Services increasing with unit growth, investment in transferred properties and inflation Sales Growth Scenarios: Year ended 2018E (in millions) 2015 Estimated growth case Higher growth case 2018 Originated Sales1 $440 $550 Pro Forma Adjusted EBITDA2 $160 $195 Non-cash compensation 4 4 Targeted Synergies 21 21 Modified Adjusted EBITDA Including Synergies3 $185 $220 8

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Appendix 9

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Vistana Signature Experiences – Non-GAAP to GAAP Reconciliations (in millions) Year Ended 2015E Year Ended 2018E Year Ended 2014 Low High 2015 Estimated growth case Higher growth case Income before income taxes $127 $133 $138 $154 $191 Depreciation and amortization 38 39 39 48 48 Percentage of completion deferral 1 8 8 3 3 Residential (12) Adjusted EBITDA1 154 180 185 205 242 Royalty Fees (36) (37) (37) (38) (40) Management Fees (2) (3) (3) (3) (3) Expenses for Credit Facilities (4) (4) (4) (4) (4) Pro-Forma Adjusted EBITDA2 112 136 141 160 195 Non-cash compensation 4 4 4 4 4 Targeted synergies 21 21 Modified Adjusted EBITDA3 $116 $140 $145 $185 $220 Note: Financial information (other than targeted synergies) on this slide prepared by Vistana. Financial information presented excludes any impact related to the acquisition method of accounting. Adjusted EBITDA is in accordance with the basis of presentation used in the Vistana Form 10 filed September 22, 2015 and excludes the impact of deferral adjustment associated with percentage of completion accounting guidelines reflecting its net impact on Vistana’s GAAP revenues and expenses and the operations of Starwood’s residential business. Pro forma Adjusted EBITDA includes the impact of the pro forma adjustments related to royalty fees, management fees and credit facility fees. Modified Adjusted EBITDA equals Pro forma Adjusted EBITDA excluding non-cash compensation expense and includes targeted synergies in 2018. 10

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Resort Name Location Experience Completed Units Planned Units Total Units Sheraton Vistana Resort Orlando, FL Theme park 1,566 — 1,566 Sheraton Vistana Villages Orlando, FL Theme park 892 734 1,626 Vistana’s BeachClub Jensen Beach, FL Beach 76 — 76 Sheraton PGA Vacation Resort Port St. Lucie, FL Golf 30 — 30 The Westin Nanea Ocean Villas Maui, HI Beach — 390 390 The Westin Ka’anapali Ocean Resort Villas Maui, HI Beach 280 — 280 The Westin Ka’anapali Ocean Resort Villas North Maui, HI Beach 258 — 258 The Westin Princeville Ocean Resort Villas Kauai, HI Beach 173 — 173 The Westin Lagunamar Ocean Resort Villas & Spa Cancun, MX Beach 290 — 290 The Westin St. John Resort & Villas St. John, USVI Beach 164 88 252 Harborside Resort at Atlantis Nassau, Bahamas Beach/Casino 198 — 198 Sheraton Broadway Plantation Myrtle Beach, SC Golf/Beach 342 160 502 The Westin Mission Hills Resort Villas Rancho Mirago, CA Golf/Desert 158 — 158 The Westin Desert Willow Villas, Palm Desert Palm Desert, CA Golf/Desert 134 166 300 The Westin Kierland Villas Scottsdale, AZ Golf/Desert 149 — 149 Sheraton Desert Oasis Villas Scottsdale, AZ Golf/Desert 150 — 150 Sheraton Mountain Vista Vail Calley, CO Ski/Mountain 78 — 78 The Westin Riverfront Mountain Villas Vail Calley, CO Ski/Mountain 34 — 34 Lakeside Terrace Villas Vail Calley, CO Ski/Mountain 23 — 23 Sheraton Steamboat Resort Steamboat Springs, CO Ski/Mountain 21 — 21 Total 5,016 1,538 6,554 Bolstering ILG’s Vacation Ownership Portfolio Vistana’s Vacation Ownership Resorts 11

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Resort Name Location Experience Completed Units Planned Units Total Units The Phoenician Residences, The Luxury Collection Residence Club Scottsdale, AZ Golf/Desert 6 — 6 The St. Regis Residence Club, Aspen Aspen, CO Ski/Mountain 25 — 25 The St. Regis Residence Club, New York New York, NY City/Cultural 31 — 31 Total 62 — 62 Bolstering ILG’s Vacation Ownership Portfolio Vistana’s Fractional Residence Properties Resort Name Location Experience Hotel Rooms The Westin Resort & Spa, Cancun Cancun, MX Beach 379 The Westin Resort & Spa, Puerto Vallarta Puerto Vallarta, MX Beach 280 The Westin Resort & Spa, Los Cabos Los Cabos, MX Beach 243 Sheraton Kauai Resort Kauai, HI Beach 394 Sheraton Steamboat Resort Steamboat Springs, CO Ski/Mountain 264 Total 1,560 Vistana’s Transferred Properties 12

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