If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D,
and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. ☐
The information required on the remainder of this cover page
shall not be deemed to be filed for the purpose of section 18 of the Securities Exchange Act of 1934 (
Act
) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other
provisions of the Act (however, see the Notes).
SCHEDULE 13D
CUSIP No. 700517105
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1.
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Names of
reporting persons
HNA Group Co., Ltd.
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2.
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Check the appropriate box if a member
of a group (see instructions)
(a) ☒ (b) ☐
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3.
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SEC use only
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4.
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Source of funds (see instructions)
N/A
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5.
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Check if disclosure of legal
proceedings is required pursuant to Items 2(d) or 2(e) ☐
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6.
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Citizenship or place of
organization
Peoples Republic of China
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Number of
shares
beneficially
owned by
each
reporting
person
with
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7.
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Sole voting power
0
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8.
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Shared voting power
53,651,453
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9.
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Sole dispositive power
0
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10.
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Shared dispositive power
53,651,453
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11.
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Aggregate amount beneficially owned by each reporting person
53,651,453
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12.
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Check if the aggregate amount in Row
(11) excludes certain shares (see instructions) ☐
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13.
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Percent of class represented by amount
in Row (11)
25.0%
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14.
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Type of reporting person (see
instructions)
CO
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SCHEDULE 13D
CUSIP No. 700517105
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1.
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Names of
reporting persons
HNA Tourism Group Co., Ltd.
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2.
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Check the appropriate box if a member
of a group (see instructions)
(a) ☒ (b) ☐
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3.
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SEC use only
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4.
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Source of funds (see instructions)
WC, AF
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5.
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Check if disclosure of legal
proceedings is required pursuant to Items 2(d) or 2(e) ☐
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6.
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Citizenship or place of
organization
Peoples Republic of China
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Number of
shares
beneficially
owned by
each
reporting
person
with
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7.
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Sole voting power
0
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8.
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Shared voting power
53,651,453
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9.
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Sole dispositive power
0
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10.
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Shared dispositive power
53,651,453
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11.
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Aggregate amount beneficially owned by each reporting person
53,651,453
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12.
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Check if the aggregate amount in Row
(11) excludes certain shares (see instructions) ☐
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13.
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Percent of class represented by amount
in Row (11)
25.0%
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14.
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Type of reporting person (see
instructions)
CO
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SCHEDULE 13D
CUSIP No. 700517105
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1.
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Names of
reporting persons
HNA Tourism (HK) Group Co., Ltd.
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2.
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Check the appropriate box if a member
of a group (see instructions)
(a) ☒ (b) ☐
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3.
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SEC use only
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4.
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Source of funds (see instructions)
N/A
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5.
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Check if disclosure of legal
proceedings is required pursuant to Items 2(d) or 2(e) ☐
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6.
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Citizenship or place of
organization
Hong Kong Special Administrative Region
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Number of
shares
beneficially
owned by
each
reporting
person
with
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7.
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Sole voting power
0
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8.
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Shared voting power
53,651,453
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9.
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Sole dispositive power
0
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10.
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Shared dispositive power
53,651,453
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11.
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Aggregate amount beneficially owned by each reporting person
53,651,453
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12.
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Check if the aggregate amount in Row
(11) excludes certain shares (see instructions) ☐
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13.
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Percent of class represented by amount
in Row (11)
25.0%
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14.
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Type of reporting person (see
instructions)
CO
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SCHEDULE 13D
CUSIP No. 700517105
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1.
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Names of
reporting persons
HNA HLT Holdco III Limited
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2.
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Check the appropriate box if a member
of a group (see instructions)
(a) ☒ (b) ☐
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3.
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SEC use only
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4.
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Source of funds (see instructions)
N/A
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5.
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Check if disclosure of legal
proceedings is required pursuant to Items 2(d) or 2(e) ☐
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6.
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Citizenship or place of
organization
Hong Kong Special Administrative Region
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Number of
shares
beneficially
owned by
each
reporting
person
with
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7.
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Sole voting power
0
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8.
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Shared voting power
53,651,453
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9.
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Sole dispositive power
0
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10.
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Shared dispositive power
53,651,453
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11.
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Aggregate amount beneficially owned by each reporting person
53,651,453
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12.
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Check if the aggregate amount in Row
(11) excludes certain shares (see instructions) ☐
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13.
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Percent of class represented by amount
in Row (11)
25.0%
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14.
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Type of reporting person (see
instructions)
CO
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SCHEDULE 13D
CUSIP No. 700517105
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1.
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Names of
reporting persons
HNA HLT Holdco II LLC
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2.
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Check the appropriate box if a member
of a group (see instructions)
(a) ☒ (b) ☐
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3.
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SEC use only
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4.
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Source of funds (see instructions)
N/A
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5.
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Check if disclosure of legal
proceedings is required pursuant to Items 2(d) or 2(e) ☐
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6.
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Citizenship or place of
organization
Delaware
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Number of
shares
beneficially
owned by
each
reporting
person
with
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7.
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Sole voting power
0
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8.
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Shared voting power
53,651,453
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9.
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Sole dispositive power
0
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10.
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Shared dispositive power
53,651,453
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11.
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Aggregate amount beneficially owned by each reporting person
53,651,453
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12.
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Check if the aggregate amount in Row
(11) excludes certain shares (see instructions) ☐
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13.
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Percent of class represented by amount
in Row (11)
25.0%
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14.
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Type of reporting person (see
instructions)
OO
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SCHEDULE 13D
CUSIP No. 700517105
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1.
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Names of
reporting persons
HNA HLT Holdco I LLC
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2.
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Check the appropriate box if a member
of a group (see instructions)
(a) ☒ (b) ☐
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3.
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SEC use only
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4.
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Source of funds (see instructions)
BK, AF
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5.
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Check if disclosure of legal
proceedings is required pursuant to Items 2(d) or 2(e) ☐
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6.
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Citizenship or place of
organization
Delaware
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Number of
shares
beneficially
owned by
each
reporting
person
with
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7.
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Sole voting power
0
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8.
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Shared voting power
53,651,453
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9.
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Sole dispositive power
0
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10.
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Shared dispositive power
53,651,453
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11.
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Aggregate amount beneficially owned by each reporting person
53,651,453
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12.
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Check if the aggregate amount in Row
(11) excludes certain shares (see instructions) ☐
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13.
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Percent of class represented by amount
in Row (11)
25.0%
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14.
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Type of reporting person (see
instructions)
OO
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ITEM 1.
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SECURITY AND ISSUER.
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This Statement on Schedule 13D (this
Statement
)
relates to shares of common stock, par value $0.01 per share (
Common Stock
), of Park Hotels & Resorts Inc., a Delaware corporation (the
Issuer
). The principal executive offices of the Issuer are located
at 1600 Tysons Boulevard, Suite 1000, McLean, Virginia 22102.
ITEM 2.
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IDENTITY AND BACKGROUND.
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(a) - (c) and (f) This Statement is filed by (i) HNA
Group Co., Ltd. (
HNA Group
), (ii) HNA Tourism Group Co., Ltd. (
HNA Tourism
), (iii) HNA Tourism (HK) Group Co., Ltd. (
HNA Tourism HK
), (iv) HNA HLT Holdco III Limited (
SPV
III
), (v) HNA HLT Holdco II LLC (
SPV II
), and (vi) HNA HLT Holdco I LLC (
SPV I
, and together with SPV III and SPV II, the
SPVs
) (each, a
Reporting Person
and
collectively, the
Reporting Persons
).
HNA Group is a Peoples Republic of China (
PRC
) company.
HNA Group is a conglomerate holding investments in airlines, hotels, shipping, logistics, banking and leasing companies. HNA Group is majority-owned by Hainan Traffic Administration Holding Co., Ltd., a PRC company (
Hainan
Traffic
). Hainan Traffic is 50% owned by Sheng Tang Development (Yangpu) Co., Ltd., a PRC company (
Sheng Tang
). Sheng Tang is majority-owned by Hainan Province Cihang Foundation, a PRC
non-profit
organization (
Cihang
). None of Hainan Traffic, Sheng Tang or Cihang exercises control over HNA Group or has any voting or dispositive power with respect to any shares of Common
Stock.
HNA Tourism is a PRC company and a wholly-owned subsidiary of HNA Group. HNA Tourism is principally involved in the business of
providing consumers with integrated services in transportation, hospitality, travel, catering, shopping and entertainment.
HNA Tourism HK
is a Hong Kong company and wholly-owned subsidiary of HNA Tourism. HNA Tourism HK is principally involved in the business of making investments in the tourism industry.
SPV III is a Hong Kong company and a wholly-owned subsidiary of HNA Tourism HK. SPV II is a Delaware limited liability company and 100% of its
voting interests are controlled by SPV III. SPV I is a Delaware limited liability company and a wholly-owned subsidiary of SPV II. The SPVs were formed in connection with the Transaction (as defined below) and have not conducted any unrelated
activities since their formation.
The principal business address of each Reporting Person is HNA Building, No. 7 Guoxing Road,
Haikou, 570203, Peoples Republic of China.
The name, business address, present principal occupation or employment and citizenship
of each director and executive officer of each Reporting Person are set forth on Schedule A attached hereto, and Schedule A is incorporated herein by reference.
(d) During the last five years, none of the Reporting Persons nor, to their knowledge, any of their directors or executive officers, has been
convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).
(e) During the last five years, none of the
Reporting Persons nor, to their knowledge, any of their directors or executive officers, has been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a
judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, U.S. federal or state securities laws or finding any violations with respect to such laws.
ITEM 3.
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SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
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The aggregate amount of funds used
by SPV I to purchase the 53,651,453 shares of Common Stock (including 4,151,453 shares of Common Stock distributed to the Blackstone Entities (as defined below) in the Purging Distribution (as defined below)) reported herein was $1,364,982,351.45.
The source of funds used in connection with the purchase of these shares of Common Stock was funds of HNA Tourism and its affiliates available for investment and, as more fully described in Item 6 below, proceeds from a margin loan facility pursuant
to the Margin Loan Documentation (as defined below).
The information set forth in Item 6 of this Statement is incorporated herein by
reference.
ITEM 4.
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PURPOSE OF TRANSACTION.
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The purpose of the transactions described in this Statement is
for the Reporting Persons to acquire a strategic minority interest in the Issuer. The Reporting Persons intend to routinely review their investment in the Issuer. The Reporting Persons may communicate with the board of directors of the Issuer (the
Board
), members of management and/or other stockholders from time to time with respect to operational, strategic, financial or governance matters or otherwise work with management and the Board with a view to maximizing
stockholder value. Subject to the Stockholders Agreement (as defined below), the Reporting Persons may seek to sell or otherwise dispose of some or all of the Issuers securities from time to time and/or may seek to acquire additional
securities of the Issuer (which may include rights or securities exercisable or convertible into securities of the Issuer) from time to time, in each case, in open market or private transactions, block trades or otherwise. Subject to the
Stockholders Agreement, any transaction that any of the Reporting Persons may pursue may be made at any time and from time to time without prior notice and will depend on a variety of factors, including, without limitation, the price and
availability of the Issuers securities, subsequent developments affecting the Issuer, the Issuers business and the Issuers prospects, other investment and business opportunities available to such Reporting Persons, general industry
and economic conditions, the securities markets in general, tax considerations and other factors deemed relevant by such Reporting Persons.
As more fully described in Item 6 below, HNA Tourism has the right (but not the obligation) to designate two directors of the Issuer pursuant
to the Stockholders Agreement, only one of which may be affiliated with HNA Tourism (but not its hospitality business) and the other of which must meet the independence standards of the New York Stock Exchange with respect to the Issuer and not have
been, for two years, an employee, director or officer of, or consultant to, HNA Tourism or any of its affiliate. HNA Tourism intends to exercise this right and designate two directors to the Board. Following such designation, HNA Tourisms
designees to the Board, may, in such capacity, have influence over corporate activities of the Issuer, including activities which may relate to items described in subparagraphs (a) through (j) of Item 4 of Schedule 13D.
Except as described in this Statement, the Reporting Persons do not have any present plans or proposals that relate to or would result in any
of the actions described in subparagraphs (a) through (j) of Item 4 of Schedule 13D, although, subject to the Stockholders Agreement, the Reporting Persons, at any time and from time to time, may review, reconsider and change their position
and/or change their purpose and/or develop such plans and may seek to influence the Board or management of the Issuer with respect to the business and affairs of the Issuer and may from time to time consider pursuing or proposing such matters with
advisors, the Issuer or other persons.
The information set forth in Item 6 of this Statement is incorporated herein by reference.
ITEM 5.
|
INTEREST IN SECURITIES OF THE ISSUER.
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(a) and (b) The responses of the Reporting
Persons to Rows 7 through 13 of the cover pages of this Statement are incorporated herein by reference. As of the date hereof, SPV I was the direct owner of and may be deemed to have shared voting and dispositive power with respect to, and each
other Reporting Person may be deemed to beneficially own and have shared voting and dispositive power with respect to, 53,651,453 shares of Common Stock, representing approximately 25.0% of the outstanding shares of Common Stock (such percentage
being based on 214,238,197 shares of Common Stock outstanding as of March 21, 2017).
(c) As more fully described in Item 6 below, on
March 15, 2017, SPV I purchased an aggregate of 53,651,453 shares of Common Stock from the Blackstone Entities (as defined below) (including 4,151,453 shares of Common Stock distributed to the Blackstone Entities in the Purging Distribution (as
defined below)) for an aggregate price of $1,364,982,351.45 (approximately $25.45 per share), pursuant to the terms of the Stock Purchase Agreement (as defined below).
(d) Not applicable.
(e) Not
applicable.
ITEM 6.
|
CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER.
|
The Transaction
On
October 24, 2016, HNA Tourism and certain entities affiliated with The Blackstone Group L.P. (the
Blackstone Entities
) entered into a stock purchase agreement (the
Stock Purchase Agreement
), pursuant to
which HNA Tourism agreed to acquire 247,500,000 shares of the common stock of Hilton Worldwide Holdings Inc. (
Hilton
), representing approximately 25% of the shares of Hilton common stock then outstanding (the
Transaction
). Under the terms of the Stock Purchase Agreement, HNA Tourism agreed to pay $26.25 per share of Hilton common stock or an aggregate amount in cash of $6,496,875,000. The Stock Purchase Agreement provided that the
Transaction would include shares of Common Stock and shares of the common stock of Hilton Grand Vacations Inc. (
HGV
) if Hilton made a pro rata distribution of Common Stock and HGV common stock to Hiltons stockholders (the
Spin-offs
) prior to the closing of the Transaction (the
Closing
). The Stock Purchase Agreement further provided that if the Transaction closed on or after the record date of a dividend distribution effected by
the Issuer to its stockholders for the purposes of distributing the Issuers accumulated earnings and profits attributable to its taxable years prior to becoming a real estate investment trust for U.S. federal income tax purposes (the
Purging Distribution
), then (i) the Transaction would include additional shares of Common Stock paid by the Issuer to its stockholders in the Purging Distribution with a value equal to 80% of the value of the Purging
Distribution in respect of the Common Stock included in the Transaction as a result of the Spin-offs and (ii) the cash consideration paid by HNA Tourism in the Transaction would be reduced by 20% of the value of the Purging Distribution in
respect of the Common Stock included in the Transaction (the
Purged Cash
).
On January 3, 2017, Hilton consummated the Spin-offs, pursuant to which each of
Hiltons stockholders received (i) one share of HGV common stock for every ten shares of Hilton common stock it held and (ii) one share of Common Stock for every five shares of Hilton common stock it held. On January 4, 2017, the
Issuer announced that the record date for the Purging Distribution would be January 19, 2017.
On March 7, 2017, HNA Tourism
assigned its rights under the Stock Purchase Agreement to purchase shares of Hilton common stock, HGV common stock and Common Stock to SPV I.
The Transaction closed on March 15, 2017. The aggregate purchase price of $6,496,875,000 under the Stock Purchase Agreement was reduced
by $27,621,000 in Purged Cash and, after giving effect to the Spin-offs,
the 1-for-3 reverse
stock split of the Hilton common stock that was effective on
January 3, 2017 and the Purging Distribution, the aggregate consideration paid to the Blackstone Entities by SPV I at the Closing was $6,469,254,000, consisting of (i) $4,502,285,082.75 for 82,500,000 shares of Hilton common stock, (ii)
$601,986,565.80 for 24,750,000 shares of HGV common stock, and (iii) $1,364,982,351.45 for 53,651,453 shares of Common Stock (including 4,151,453 shares of Common Stock distributed to the Blackstone Entities in the Purging Distribution). The
aggregate consideration paid to the Blackstone Entities included $500 million of cash which had been deposited by HNA Tourism into an escrow account concurrently with the signing of the Stock Purchase Agreement and was released to the
Blackstone Entities at the Closing.
Stockholders Agreement
In connection with the Transaction, HNA Tourism (and HNA Group for purposes of the standstill provision only) entered into a stockholders
agreement with the Issuer (the
Stockholders Agreement
) that became effective upon the Closing on March 15, 2017. In connection with the Closing, SPV I executed a joinder on March 15, 2017 and became a party to the
Stockholders Agreement. The Stockholders Agreement will terminate when HNA Tourism and/or its affiliates that own Common Stock (collectively, the
HNA Parties
), in the aggregate, hold less than 5% of the Common Stock.
Directors
. Pursuant to the Stockholders Agreement, for so long as the HNA Parties hold at least 15% of the Common Stock, HNA Tourism
will have the right (but not the obligation) to designate two directors of the Issuer, only one of which may be affiliated with HNA Tourism (but not its hospitality business) and the other of which must meet the independence standards of the New
York Stock Exchange with respect to the Issuer and not have been, for two years, an employee, director or officer of, or consultant to, HNA Group, HNA Tourism or any of their controlled affiliates. Each of HNA Tourisms director designees must
be reasonably satisfactory to the Issuers Nominating and Corporate Governance Committee. In addition, so long as the HNA Parties own at least 20% of the Common Stock, HNA Tourism will have the right (but not the obligation) to designate an
additional independent director to fill each third additional director seat above 11 directors of the Issuer; for example, if the Issuer were to increase the size of the Board in the future from 11 to 14, the HNA Parties would have the right to
designate an independent director as the 14th member of the Board. HNA Tourisms right to designate directors declines to one director when the HNA Parties ownership falls below 15% of the Common Stock and such right terminates when the
HNA Parties ownership falls below 5% of the Common Stock, subject to certain exceptions. Each of HNA Tourisms independent designee will be entitled to serve on at least one standing committee of the Board, as determined by the
Boards Nominating and Corporate Governance Committee.
Voting Requirements
. The Stockholders Agreement generally requires the
HNA Parties to vote all of their shares in excess of 15% of the total outstanding Common Stock in the same proportion as the shares of Common Stock owned by other stockholders are voted on all matters, except as follows: (i) in uncontested
elections of directors, the HNA Parties are required to vote all of their shares either in favor of the Boards nominees or all of their shares in the same proportion as the shares owned by other stockholders are voted; (ii) in contested
elections of directors, the HNA Parties are required to vote all of their shares in the same proportion as the shares owned by other stockholders are voted; (iii) for two years after the Closing, in third party acquisitions of Issuer where both
(A) Common Stock is exchanged for or converted into the right to receive solely cash or a mixture of cash and stock of a person other than an affiliate of HNA Tourism, of which the value of the cash portion of the aggregate consideration is
sixty percent (60%) or more of the aggregate consideration and (B) the consideration is less than or equal to the per share price paid by HNA Tourism and/or its affiliates as consideration for the Common Stock pursuant to the terms of the
Transaction, the HNA Parties may vote all of their shares as they choose; (iv) for any acquisition of the Issuer other than an acquisition described in (iii) above or an acquisition by HNA Tourism or one of its affiliates, the HNA Parties
will vote all of their shares in excess of 15% of the total outstanding Common Stock in proportion to the manner in which other stockholders vote their shares; and (v) in the case of any amendment of the Issuers certificate of
incorporation or bylaws which adversely affects the HNA Parties disproportionally as compared to other stockholders, an issuance of shares representing more than 20% of the Common Stock (other than for an acquisition) at a below-market price, or an
acquisition of the Issuer by HNA Group, HNA Tourism or their controlled affiliates, the HNA Parties may vote all of their shares as they choose. In a third party tender offer, the HNA Parties will be required to tender their shares in excess of 15%
of the total outstanding Common Stock in the same proportion as shares held by other stockholders are tendered.
Transfer Restrictions
. The Stockholders Agreement does not generally restrict transfers of
shares of Common Stock by the HNA Parties, except that if any HNA Party transfers any of its shares to an affiliate of HNA Tourism, such affiliate must agree to be bound by the terms of the Stockholders Agreement.
Right of First Refusal
. If the Issuer proposes to issue new equity securities in an offering that is not an underwritten public
offering or an offering pursuant to Rule 144A under the Securities Act of 1933, as amended (the
Securities Act
), HNA Tourism will have a right of first refusal to purchase a
pro-rata
portion
of such issuance, based on the HNA Parties ownership percentage of the outstanding Common Stock (but not more than 25% of such issuance), at the same price and on the same terms and conditions as such issuance.
Standstill
. The Stockholders Agreement requires that HNA Group, the HNA Parties and their affiliates not: (i) acquire, offer or
agree to acquire, any beneficial interest in the Issuer; (ii) make any public announcement or public offer with respect to any merger, business combination or other similar transaction involving the Issuer (except when the Board recommends or
approves such transaction); (iii) make or in any way participate in any solicitation of proxies to vote or seek to influence voting of securities of the Issuer in a manner inconsistent with the Boards recommendation;
(iv) seek election to the Board other than the HNA Parties designees or removal of any member of the Board or otherwise act, alone or in concert with others, to control or influence the Issuer; (v) call a meeting of the stockholders
of the Issuer; (vi) participate in a group regarding equity securities of the Issuer (other than a group consisting solely of HNA Parties); (vii) act, alone or in concert with others, to seek to control or influence the
management or policies of the Issuer; (viii) knowingly assist or encourage, or enter into any discussions or agreements with any third party, in connection with any of the foregoing activities; (ix) publicly disclose any intention, plan or
arrangement inconsistent with any of the foregoing activities; (x) provide any financing for a purchase of equity securities or assets of the Issuer, subject to certain exceptions; (xi) take any actions that the HNA Parties know or would
reasonably be expected to know would require the Issuer to make a public announcement regarding the possibility of an acquisition; or (xii) contest the validity of the foregoing standstill restrictions or participate in a judicial proceeding
seeking to amend or terminate the foregoing standstill restrictions. The HNA Parties are not prohibited from: (i) transferring Common Stock to controlled affiliate of HNA Group or HNA Tourism; (ii) purchasing Common Stock pursuant to the
right of first refusal over their
pro-rata
portion of newly issued equity securities of the Issuer described above; (iii) engaging in private discussions with or submitting to the Board a
non-public,
confidential acquisition proposal; or (iv) after a public announcement of a definitive agreement for the acquisition of the Issuer by a third party, making a publicly announced alternative
acquisition proposal for all of the outstanding shares of the Issuer, which, if a tender or exchange offer, must be on the same terms for all such shares and include a non-waivable condition that a majority of the shares held by the other
stockholders are tendered into such offer, or taking any other action in connection with evaluating, making or effecting an alternative acquisition proposal. To the extent the HNA Parties ownership percentage falls below 25% of the total
outstanding Common Stock (or a lower percentage that results from sales of shares by the HNA Parties) as a result of issuances by the Issuer, the HNA Parties may purchase Common Stock in the open market so as to maintain their ownership percentage
at 25% (or such lower percentage that results from sales of shares by the HNA Parties).
Registration Rights Agreement
In connection with the Transaction, HNA Tourism entered into a registration rights agreement with the Issuer (the
Registration Rights
Agreement
) that became effective upon the Closing on March 15, 2017. The Registration Rights Agreement provides that, beginning two years after the closing of the Transaction (or earlier if the Issuer waives the standstill under the
Stockholders Agreement), the HNA Parties will have customary (i) demand registration rights and (ii) piggyback registration rights (other than in the case of an underwritten secondary offering initiated by a Blackstone
Entity). The Registration Rights Agreement requires the Issuer to pay certain expenses relating to such registrations and indemnify the registration rights holder against certain liabilities under the Securities Act.
Waiver Letter Agreement
HNA Tourism has entered into an agreement with the Issuer and Hilton, pursuant to which the Issuer granted HNA Tourism and its affiliates
(each, an
HNA Exempted Holder
and collectively, the
HNA Exempted Holders
) a limited exemption from the common stock ownership limit permitting the HNA Exempted Holders to own 25.006% of the outstanding Common
Stock, subject to adjustment as a result of the Purging Distribution to the extent that there is a resulting percentage increase in the number of shares of Common Stock owned as a result thereof. In addition, the Issuer agreed to grant a limited
exemption from the common stock ownership limit to the Lenders (as defined below) under the Margin Loan Facility (as defined below), at the time the Lenders foreclose on any of their collateral that will permit such Lenders to own Common Stock that
was foreclosed upon, provided that such Lender provide to the Issuer, at the time of such foreclosure, such representations, warranties and covenants to ensure that the limited
exemption provided to such Lenders satisfies the requirements of the Issuers amended and restated certificate of incorporation, including the requirement
that the exemption not result in the Issuer failing to qualify as a real estate investment trust, as determined by the Board in its good faith discretion.
Margin Loan Facility
HNA HLT Holdco IV LLC, a Delaware limited liability company and an affiliate of HNA Tourism (the
Borrower
), SPV I (the
Pledgor
) and SPV II have entered into a Margin Loan Agreement dated as of March 7, 2017 (as amended from time to time, the
Loan Agreement
) with the lenders party thereto (each, a
Lender
and collectively, the
Lenders
) and JPMorgan Chase Bank, N.A., London Branch, as administrative agent and calculation agent (the
Administrative Agent
). In connection with the Loan Agreement, (i) the
Borrower and the Pledgor have entered into a Pledge and Security Agreement dated as of March 7, 2017, with the Administrative Agent and the Lenders party thereto (the
Pledge and Security Agreements
); (ii) the Borrower has
entered into a Funding Account Pledge and Security Agreement (the
Funding Account Pledge and Security Agreement
) dated as of March 7, 2017, with JPMorgan Chase Bank, N.A., London Branch, as collateral agent (the
Collateral Agent); (iii) the Pledgor has entered into an agreement in respect of the collateral assignment of certain rights under the Stock Purchase Agreement dated as of March 13, 2017, with the Administrative Agent (the
Collateral Assignment Agreement
); (iv) the Borrower and the Pledgor have entered into Account Control Agreements dated as of March 7, 2017 with Deutsche Bank Trust Company Americas, as intermediary (the
Intermediary
), and each Lender, respectively (together, the
Control Agreements
); (v) the Borrower has entered into a Funding Account Control Agreement dated as of March 7, 2017 with the Intermediary and the
Collateral Agent (the
Funding Account Control Agreement
); (vi) the Pledgor has entered into a guarantee dated as of March 7, 2017, with the Administrative Agent and the Lenders (the
Pledgor Guarantee
);
(vii) the Issuer has entered into issuer agreements dated as of March 15, 2017, with each Lender, respectively, and the Administrative Agent (together, the
Issuer Agreements
); and (viii) HNA Tourism has entered into a
parent agreement dated as of March 7, 2017, with the Administrative Agent (the
Parent Agreement
, and together with the Loan Agreement, the Pledge and Security Agreements, the Funding Account Pledge and Security Agreement, the
Collateral Assignment Agreement, the Control Agreements, the Funding Account Control Agreement, the Pledgor Guarantee, the Issuer Agreements, and any borrowing notice and each agreement or instrument delivered pursuant to the foregoing or pursuant
to the security interests and collateral granted in accordance with the foregoing, the
Margin Loan Documentation
).
As
of March 15, 2017, the Borrower has borrowed an aggregate of $3,000,000,000 (not including any interest paid in kind) under the Loan Agreement. Pursuant to the Pledge and Security Agreements, the Borrowers obligations under the Loan
Agreement are secured by a pledge of a basket of shares owned by the Borrower, initially consisting of Hilton common stock, HGV common stock and Common Stock. As of March 15, 2017, the Borrower has collectively pledged approximately (i)
82,500,000 shares of Hilton common stock, (ii) 24,750,000 shares of HGV common stock, and (iii) 53,651,453 shares of Common Stock (collectively, the
Pledged Shares
).
The loans under the Loan Agreement mature on or about March 15, 2020, subject to any mutually agreed extension. Upon the occurrence of
certain events that are customary for these type of loans, the Lenders may exercise their rights to require the Borrower to
pre-pay
the loan proceeds or post additional collateral, and the Lenders may exercise
their rights to foreclose on, and dispose of, the Pledged Shares and other collateral, in each case, in accordance with the Margin Loan Documentation.
The descriptions of the Stock Purchase Agreement, Stockholders Agreement, Registration Rights Agreement and Loan Agreement contained in this
Item 6 are not intended to be complete and are qualified in their entirety by reference to such agreements, each of which is attached hereto as an exhibit and incorporated herein by reference.
Pursuant to Rule
13d-1(k)
promulgated under the Securities Exchange Act of 1934, as amended, the
Reporting Persons have entered into an agreement with respect to the joint filing of this Statement and any amendment or amendments thereto, a copy of which is attached hereto as an exhibit and incorporated herein by reference.
The information set forth in Item 4 of this Statement is incorporated herein by reference.
ITEM 7.
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MATERIAL TO BE FILED AS EXHIBITS.
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Exhibit
A
|
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Joint Filing Agreement, dated as of March 24, 2017, by and among the Reporting Persons (filed herewith)
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Exhibit B
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Stock Purchase Agreement (incorporated by reference to Exhibit 99.1 to Hiltons Current Report on
Form 8-K filed
on October 24, 2016)
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Exhibit C
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Stockholders Agreement (incorporated by reference to Exhibit 10.13 to the Issuers Registration Statement on Form 10 (File
No. 001-37795),
filed on November 14, 2016)
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Exhibit D
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Registration Rights Agreement (incorporated by reference to Exhibit 10.12 to the Issuers Registration Statement on Form 10 (File
No. 001-37795),
filed on November 14,
2016)
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Exhibit E
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Loan Agreement (filed herewith)
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SIGNATURES
After reasonable inquiry and to the best of its knowledge and belief, each of the undersigned certifies that the information set forth in this
Statement is true, complete and correct.
Dated: March 24, 2017
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HNA Group Co., Ltd.
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|
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By:
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/s/ TAN Xiangdong
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Name: TAN Xiangdong
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Title: Chief Executive Officer
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HNA Tourism Group Co., Ltd.
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By:
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/s/ ZHANG Ling
|
Name: ZHANG Ling
Title: Chairman of the Board of Directors
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HNA Tourism (HK) Group Co., Ltd.
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By:
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/s/ GUO Yajun
|
Name: GUO Yajun
Title: Director
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HNA HLT Holdco III Limited
|
|
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By:
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/s/ WANG Xun
|
Name: WANG Xun
Title: Director
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HNA HLT Holdco II LLC
|
|
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By:
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/s/ WANG Xun
|
Name: WANG Xun
Title: Manager
|
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HNA HLT Holdco I LLC
|
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By:
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/s/ WANG Xun
|
Name: WANG Xun
Title: Manager
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Schedule A
The name, country of citizenship and current principal occupation of each director
and executive officer of HNA Group Co., Ltd.
(
HNA Group
), are set forth below. Unless otherwise indicated, each occupation set forth opposite an individuals name refers to HNA Group. The business address of each
director and executive officer is HNA Building, No. 7, Guoxing Road, Haikou, Hainan Province, the Peoples Republic of China. Unless otherwise indicated below, all of the persons listed below are citizens of the Peoples Republic of
China. Directors are identified by an asterisk.
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|
|
|
|
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Name
|
|
Current Principal Occupation of Employment
|
|
|
Wang Jian*
|
|
Chairman of the Board of Directors
|
|
|
Chen Feng*
|
|
Co-Chairman
of the Board of Directors
|
|
|
Tan Xiangdong*
|
|
Vice Chairman of the Board of Directors and Chief Executive Officer; Chairman of the Board of Directors of HNA Innovation Finance Group Co., Ltd. (United States citizen)
|
|
|
Li Xianhua*
|
|
Vice Chairman of the Board of Directors
|
|
|
Chen Wenli*
|
|
Vice Chairman of the Board of Directors; Chairman of the Board of Directors of HNA Aviation Group Co., Ltd.
|
|
|
Zhang Ling*
|
|
Chairman of the Board of Directors of HNA Tourism Group Co., Ltd.
|
|
|
Lu Ying*
|
|
Vice Chairman of the Board of Directors
|
|
|
Huang Qijun*
|
|
Chairman of the Board of Directors of HNA Holding Group Co., Ltd.
|
|
|
Xin Di*
|
|
Chief Executive Officer of HNA Aviation Group Co, Ltd.
|
|
|
Tang Liang*
|
|
Chairman of the Board of Directors of HNA Capital Group Co., Ltd.
|
|
|
Tong Fu*
|
|
Chairman of the Board of Directors of HNA Technology Logistics Group Co, Ltd.
|
|
|
Xu Zhoujin
|
|
Chief Financial Officer
|
2.
|
HNA Tourism Group Co., Ltd.
|
The name, country of citizenship and current principal occupation of each
director and executive officer of HNA Tourism Group Co, Ltd. (
HNA Tourism
), are set forth below. Each occupation set forth opposite an individuals name refers to HNA Tourism. The business address of each director and
executive officer is HNA Building, No. 7, Guoxing Road, Haikou, Hainan Province, the Peoples Republic of China. All of the persons listed below are citizens of the Peoples Republic of China. Directors are identified by an asterisk.
|
|
|
|
|
|
|
Name
|
|
Current Principal Occupation of Employment
|
|
|
Zhang Ling*
|
|
Chairman of the Board of Directors
|
|
|
Tian Lixiong*
|
|
Vice Chairman of the Board of Directors
|
|
|
Hu Mingbo*
|
|
Vice Chairman of the Board of Directors
|
|
|
Ying Xueli*
|
|
Vice Chairman of the Board of Directors
|
|
|
Bai Haibo*
|
|
CEO of HNA Hospitality Group Co., Ltd.
|
|
|
Liu Jiangtao*
|
|
Vice Chairman of the Board of Directors
|
|
|
Li Tie*
|
|
Chief Executive Officer
|
|
|
Wang Chenghua
|
|
Chief Financial Officer
|
3.
|
HNA Tourism (HK) Group Co., Ltd.
|
The name, country of citizenship and current principal occupation of
the sole director of HNA Tourism (HK) Group Co, Ltd. (
HNA Tourism HK
), are set forth below. HNA Tourism HK does not have any executive officers. The business address of the director is HNA Building, No. 7, Guoxing Road,
Haikou, Hainan Province, the Peoples Republic of China. The director is a citizen of the Peoples Republic of China.
|
|
|
|
|
|
|
Name
|
|
Current Principal Occupation of Employment
|
|
|
Guo Yajun
|
|
Chairman of the Board of Directors of HNA Innovation, Inc.
|
4.
|
HNA HLT Holdco III Limited
|
The name, country of citizenship and current principal occupation of the
sole director of HNA HLT Holdco III Limited (
SPV III
) are set forth below. SPV III does not have any executive officers. The business address of the director is HNA Building, No. 7, Guoxing Road, Haikou, Hainan Province, the
Peoples Republic of China. The director is a citizen of the Peoples Republic of China.
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|
|
|
|
|
|
Name
|
|
Current Principal Occupation of Employment
|
|
|
Wang Xun
|
|
Deputy General Manager of the Department of Finance of HNA Tourism Group Co., Ltd.
|
The name, country of citizenship and current principal occupation of each manager
of HNA HLT Holdco II LLC (
SPV II
), are set forth below. SPV II does not have directors or other executive officers. If no business address is given, the managers business address is HNA Building, No. 7, Guoxing Road,
Haikou, Hainan Province, the Peoples Republic of China. Unless otherwise indicated below, all of the persons listed below are citizens of the Peoples Republic of China.
|
|
|
|
|
|
|
Name
|
|
Current Principal Occupation of Employment (address of any corporation or other organization other than SPV 2 or its
affiliates)
|
|
|
Wang Xun
|
|
Deputy General Manager of the Department of Finance of HNA Tourism Group Co., Ltd.
|
|
|
Wang Chenghua
|
|
Chief Financial Officer of HNA Tourism Group Co., Ltd.
|
|
|
Victor A. Duva
|
|
President and Independent Director of CT Corporation Staffing, Inc., 1209, Orange Street, Wilmington, DE (United States citizen)
|
The name, country of citizenship and current principal occupation of each manager
of HNA HLT Holdco I LLC (
SPV I
), are set forth below. SPV I does not have directors or other executive officers. If no business address is given, the managers business address is HNA Building, No. 7, Guoxing Road,
Haikou, Hainan Province, the Peoples Republic of China. Unless otherwise indicated below, all of the persons listed below are citizens of the Peoples Republic of China.
|
|
|
|
|
|
|
Name
|
|
Current Principal Occupation of Employment (address of any corporation or other organization other than SPV 1 or its
affiliates)
|
|
|
Wang Xun
|
|
Deputy General Manager of the Department of Finance of HNA Tourism Group Co., Ltd.
|
|
|
Wang Chenghua
|
|
Chief Financial Officer of HNA Tourism Group Co., Ltd.
|
|
|
Victor A. Duva
|
|
President and Independent Director of CT Corporation Staffing, Inc., 1209, Orange Street, Wilmington, DE (United States citizen)
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