Item 1.01. Entry into a Material Definitive Agreement.
Indenture and Notes
On
The Issuer intends to use the net proceeds from the Notes, together with cash on
hand, to (i) redeem
On
The Notes will bear interest at a rate of 4.500% per year, payable in cash
semi-annually in arrears on
The Notes will initially be guaranteed on a senior unsecured basis by MVW and
each of MVW's subsidiaries that guarantees the Corporate Credit Facility (as
defined below), and, in the future, by each of MVW's subsidiaries (other than
receivables subsidiaries or foreign subsidiaries) that becomes a borrower or a
guarantor under a credit facility or other capital markets debt securities of
the Issuer or any guarantor of the Notes. "Corporate Credit Facility" means
MVW's corporate credit facility consisting of a
The Notes are senior unsecured obligations of the Issuer and the guarantors thereof, rank pari passu in right of payment with all of the Issuer's and the guarantors' existing and future senior indebtedness (including borrowings under the Corporate Credit Facility, the Issuer's Existing Notes (as defined in the Indenture) and MVW's outstanding 0.000% Convertible Senior Notes due 2026 and 1.500% Convertible Senior Notes due 2022 (with respect to MVW only)), will be senior in right of payment to any future subordinated indebtedness of the Issuer and the guarantors, are effectively junior to all of the Issuer's and the guarantors' existing and future secured indebtedness (including under the Corporate Credit Facility and the Issuer's 6.125% Senior Secured Notes due 2025) to the extent of the value of the collateral securing such indebtedness and are structurally subordinated to any existing and future obligations of any of MVW's subsidiaries that do not guarantee the Notes.
Prior to
Year Price 2024 102.250 % 2025 101.125 % 2026 and thereafter 100.000 % 1
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If MVW experiences a "Change of Control" (as defined in the Indenture) or sells certain of its assets, MVW will be required to repurchase the Notes at the prices set forth in the Indenture, subject to certain conditions.
The Indenture contains certain covenants, which among other things, limit the ability of MVW and its restricted subsidiaries to (i) incur additional indebtedness; (ii) pay dividends or make other restricted payments; (iii) make loans and investments; (iv) incur liens; (v) sell assets; (vi) enter into affiliate transactions; (vii) enter into certain sale and leaseback transactions; (viii) enter into agreements restricting MVW's subsidiaries' ability to pay dividends; and (ix) merge, consolidate or amalgamate or sell all or substantially all of its property. These covenants are subject to a number of important exceptions and qualifications. The Indenture provides for customary events of default which include (subject in certain cases to customary grace and cure periods), among others, nonpayment of principal or interest, failure to comply with other covenants or agreements in the Notes or the Indenture, failure to pay certain other indebtedness, failure to pay certain final judgments, failure of certain guarantees to be enforceable and certain events of bankruptcy or insolvency. These events of default are subject to a number of important qualifications, limitations and exceptions that are described in the Indenture.
The offer and sale of the Notes and the related guarantees were made in
The foregoing description of the Indenture and the Notes does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Indenture and the form of Note, copies of which are filed as Exhibits 4.1 and 4.2 hereto, respectively, and are incorporated herein by reference.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The information included in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 2.03.
No Offer or Solicitation
This communication is for informational purposes only and is not intended to and does not constitute an offer to buy, nor a solicitation of an offer to sell, subscribe for or buy any securities or the solicitation of any vote or approval in any jurisdiction pursuant to or in connection with the proposed transactions or otherwise, nor shall there be any sale, issuance or transfer of securities in any jurisdiction in contravention of applicable law. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act and otherwise in accordance with applicable law.
Cautionary Statement Regarding Forward-Looking Statements
Certain statements included in this Current Report on Form 8-K and information incorporated by reference herein constitute "forward-looking statements" within the meaning of federal securities laws. These forward-looking statements are based on current expectations and assumptions that involve risks and uncertainties and on information available to MVW as of the date hereof. MVW cautions you that these statements are not guarantees of future performance and are subject to numerous and evolving risks and uncertainties that we may not be able to predict or assess, such as: the effects of the COVID-19 pandemic, including reduced demand for vacation ownership and exchange products and services, volatility in the international and national economy and credit markets, worker absenteeism, quarantines or other government-imposed travel or health-related restrictions; the length and severity of the COVID-19 pandemic, including its short and longer-term impact on the demand for travel and on consumer confidence; the impact of the availability and distribution of effective vaccines on the demand for travel and consumer confidence; the pace of recovery following the COVID-19 pandemic or as effective treatments or vaccines become widely available; competitive conditions; the availability of capital to finance growth; the effects of steps we have
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taken and may continue to take to reduce operating costs and/or enhance health
and cleanliness protocol at our resorts due to the COVID-19 pandemic; political
or social strife, and other matters referred to under the heading "Risk Factors"
contained in our most recent Annual Report on Form 10-K, and which may be
discussed in our periodic filings with the
Item 9.01. Financial Statements and Exhibits
(d) The following exhibits are filed with this Current Report on Form 8-K:
Exhibit No. Description 4.1 Indenture, dated as ofJune 21, 2021 , by and amongMarriott Ownership Resorts, Inc. ,Marriott Vacations Worldwide Corporation , as guarantor, the other guarantors party thereto andThe Bank of New York Mellon Trust Company, N.A. , as trustee. 4.2 Form of 4.500% Senior Notes due 2029 (included as Exhibit A to Exhibit 4.1). 104 Cover Page Interactive Data File (embedded within the Inline XBRL document). 3
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