UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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| Item 1.01. | Entry into a Material Definitive Agreement. |
Offering of the Notes
On August 26, 2020, Hyatt Hotels Corporation (the “Company”) issued and sold $750,000,000 of its Floating Rate Senior Notes due 2022 (the “Notes”) in a public offering (the “Offering”) pursuant to an effective Registration Statement on Form S-3 (No. 333-221740) (the “Registration Statement”). The Company received net proceeds from the Offering of approximately $746 million, after deducting underwriters’ discounts and estimated offering expenses payable by the Company. The Company intends to use the net proceeds from the Offering for general corporate purposes and to pay related fees and expenses.
Indenture
The Notes were issued pursuant to an indenture, dated August 14, 2009 (the “Original Indenture”), as supplemented by a second supplemental indenture, dated August 4, 2011 (the “Second Supplemental Indenture”), and a fourth supplemental indenture, dated May 10, 2013 (the “Fourth Supplemental Indenture” and, together with the Original Indenture and the Second Supplemental Indenture, the “Base Indenture”), between the Company and Wells Fargo Bank, National Association, as trustee (the “Trustee”), and a ninth supplemental indenture, dated September 1, 2020 (the “Ninth Supplemental Indenture” and, together with the Base Indenture, the “Indenture”), between the Company and the Trustee, specifying the terms of the Notes.
The Original Indenture was included as Exhibit 4.3 to the Company’s Registration Statement on Form S-1 (No. 333-161068), filed on September 9, 2009, and is incorporated herein by reference. The Second Supplemental Indenture was included as Exhibit 4.2 to the Company’s Registration Statement on Form S-3 (No. 333-176038), filed on August 4, 2011, and is incorporated herein by reference. The Fourth Supplemental Indenture was included as Exhibit 4.1 to the Company’s Current Report on Form 8-K (No. 001-34521), filed on May 10, 2013, and is incorporated herein by reference. The Ninth Supplemental Indenture and the forms of the Notes are attached as Exhibits 4.1 and 4.2 hereto, respectively, and are incorporated herein by reference. The Ninth Supplemental Indenture and the forms of the Notes are also filed with reference to, and are hereby incorporated by reference in, the Registration Statement.
Terms of the Notes
Interest and Maturity. The Notes will bear interest at a floating rate equal to three-month LIBOR plus 3.000% per annum, which will be payable quarterly in arrears on March 1, June 1, September 1 and December 1 of each year, beginning on December 1, 2020. The interest rate payable on the Notes will also be subject to adjustment based on certain rating events as set forth in the Indenture. The Notes will mature on September 1, 2022.
Redemption. The Notes will not be redeemable at the Company’s option before September 1, 2021. At any time on or after September 1, 2021, the Company may redeem some or all of the Notes at a price equal to 100% of the principal amount of the Notes redeemed plus accrued and unpaid interest, if any.
Change of Control. In the event of a Change of Control Triggering Event (as defined in the Indenture), the holders of the Notes may require the Company to purchase for cash all or a portion of the holders’ Notes at a purchase price equal to 101% of the principal amount of the Notes purchased plus accrued and unpaid interest, if any.
Covenants. The Indenture does not limit the ability of the Company or its subsidiaries to issue or incur other debt or issue preferred stock. Subject to certain important exceptions, the Indenture contains covenants that, among other things, limit the Company’s ability and the ability of certain of the Company’s subsidiaries to create liens on principal property, enter into sale and leaseback transactions with respect to principal property and enter into mergers or consolidations or transfer all or substantially all of the Company’s assets.
Ranking. The Notes rank equal in right of payment with all of the Company’s other existing and future unsecured unsubordinated indebtedness, senior in right of payment to all of the Company’s future subordinated indebtedness and effectively subordinated in right of payment to all of the Company’s existing and future secured obligations to the extent of the value of the assets securing such obligations. The Notes are not obligations of, nor are they guaranteed by, any of the Company’s subsidiaries. As a result, the Notes are structurally subordinated to all of the existing and future liabilities (including trade payables) of each of the Company’s subsidiaries.
The descriptions of the Indenture and the Notes herein are summaries and are qualified in their entirety by the terms of the Indenture and the Notes.
| Item 7.01. | Regulation FD Disclosure. |
On August 26, 2020, the Company issued a press release announcing that it had priced the Offering. A copy of the press release is furnished as Exhibit 99.1 hereto and is incorporated herein by reference.
The information in this Item 7.01 and Exhibit 99.1 hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section and shall not be deemed incorporated by reference in any filing made by the Company under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except as set forth by specific reference in such filing.
| Item 8.01. | Other Events. |
Underwriting Agreement
The Notes were sold pursuant to an Underwriting Agreement, dated August 26, 2020 (the “Underwriting Agreement”), between the Company and Deutsche Bank Securities Inc., as representative of the several underwriters named therein. The Underwriting Agreement sets forth the terms and conditions pursuant to which the Company agreed to sell the Notes to the underwriters and the underwriters agreed to purchase the Notes from the Company for resale to the public in the Offering.
The Underwriting Agreement is attached as Exhibit 1.1 hereto and is incorporated herein by reference. The Underwriting Agreement is also filed with reference to, and is hereby incorporated by reference in, the Registration Statement.
Legal Opinion Letter
In connection with the Offering, a legal opinion letter of Latham & Watkins LLP regarding the validity of the Notes is attached as Exhibit 5.1 hereto. The legal opinion letter is also filed with reference to, and is hereby incorporated by reference in, the Registration Statement.
| Item 9.01. | Financial Statements and Exhibits. |
(d) Exhibits.
| Exhibit No. |
Document Description | |
| 1.1 | Underwriting Agreement, dated August 26, 2020, between the Company and Deutsche Bank Securities Inc., as representative of the several underwriters named therein. | |
| 4.1 | Ninth Supplemental Indenture, dated September 1, 2020, between the Company and Wells Fargo, National Association, as trustee. | |
| 4.2 | Form of Floating Rate Senior Note due 2022 (included in Exhibit 4.1). | |
| 5.1 | Opinion of Latham & Watkins LLP, dated September 1, 2020. | |
| 23.1 | Consent of Latham & Watkins LLP (included in Exhibit 5.1). | |
| 99.1 | Press release of the Company, dated August 26, 2020. | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). | |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| Hyatt Hotels Corporation | ||||||
| Date: September 1, 2020 | By: | /s/ Joan Bottarini | ||||
| Joan Bottarini | ||||||
| Executive Vice President, Chief Financial Officer | ||||||