| Item 1.01 | Entry into a Material Definitive Agreement. |
Credit Agreement Amendment
On November 8, 2023, Hilton Domestic Operating Company Inc. (the “Borrower”), an indirect subsidiary of Hilton Worldwide Holdings Inc. (the “Company”), entered into Amendment No. 10 (the “Amendment”) to the Credit Agreement dated as of October 25, 2013 (as amended, the “Credit Agreement”).
After giving effect to the Amendment, (i) the aggregate principal amount of term B-3 loans outstanding under the Credit Agreement will equal approximately $1,000.00 million (the “Term B-3 Loans”) and (ii) the aggregate principal amount of term B-4 loans outstanding under the Credit Agreement will equal approximately $2,119.00 million (the “Term B-4 Loans”). The Term B-3 Loans will (i) mature on June 21, 2028, (ii) bear interest, at the Borrower’s option, at a per annum rate equal to a margin over either (a) a base rate determined by reference to the highest of (1) the administrative agent’s prime lending rate, (2) the federal funds effective rate plus 1/2 of 1% and (3) the SOFR rate for a one-month tenor plus 1.00% (the “Base Rate”) or (b) a Term SOFR rate determined by reference to the SOFR rate published by CME Group Benchmark Administration Limited for the interest period relevant to such borrowing (the “Term SOFR Rate”), subject to a margin for the Term B-3 Loans of 0.75% per annum, in the case of loans bearing interest at the Base Rate and 1.75% per annum, in the case of loans bearing interest at Term SOFR, a credit spread adjustment of 10 basis points and (iii) provide for a premium of 1.00% of the aggregate principal amount of any Term B-3 Loans prepaid as a result of certain repricing transactions occurring within six months of the effective date of the Amendment. The Term B-4 Loans will (i) refinance a corresponding amount of term B-2 loans and will be increased by $500.0 million of incremental term loans, (ii) mature on November 8, 2030, (iii) bear interest, at the Borrower’s option, at a per annum rate equal to a margin over either (a) the Base Rate or (b) Term SOFR, subject to a margin for the Term B-4 Loans of 1.00% per annum, in the case of loans bearing interest at the Base Rate and 2.00% per annum, in the case of loans bearing interest at Term SOFR, a credit spread adjustment of 10 basis points and (iv) provide for a premium of 1.00% of the aggregate principal amount of any Term B-4 Loans prepaid as a result of certain repricing transactions occurring within six months of the effective date of the Amendment. As a result of the refinancing of the term B-2 loans outstanding immediately prior to the Amendment, there is no longer a springing maturity with respect to the revolving facility and the maturity of the revolving facility is January 5, 2028.
All other terms of the Term B-3 Loans, Term B-4 Loans and the Credit Agreement will remain substantially the same except as otherwise amended by the Amendment.
Certain of the participants in the Credit Agreement and their respective affiliates have engaged in, and may in the future engage in, investment banking, advisory roles and other commercial dealings in the ordinary course of business with the Company and/or its affiliates. They have received, or may in the future receive, customary fees and commissions for these transactions.
The foregoing description of the Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of such document, which is filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference.
