Park Hotels & Resorts amended and restated its existing $901 million revolving credit facility to increase total capacity to $950 million, extend the maturity from December 2023 to December 2026, and release all collateral securing the credit facility (and its senior notes) consisting of pledges of equity interests in Park-affiliated entities owning certain unencumbered assets.
In addition, the credit facility includes one or more extension options of up to one additional year in the aggregate, subject to customary extension conditions, and provides for borrowings to accrue interest at an adjusted SOFR rate plus a margin ranging from 1.45% to 2.75% (vs. previous range of 1.50% to 3.00%) depending on a ratio of Park’s adjusted total indebtedness to consolidated EBITDA. The credit facility also adjusts certain financial covenants to revised levels through the end of the first quarter of 2024 and allows for Park to conduct share repurchases, subject to compliance with the financial covenants. In connection with the closing of the credit facility, Park drew down $50 million which was used, together with cash on hand, to fully repay the remaining $78 million balance on its term loan facility which was set to mature in August 2024.
“We are extremely pleased with our bank group’s on-going support of Park, with oversubscribed commitments allowing us to upsize the credit facility,” Thomas J. Baltimore, Jr., chairman and CEO, said. “With the extension of our credit facility and the full repayment of our term loan, Park has maintained its $1.9 billion of liquidity and remains very well positioned, despite current market uncertainty, to pivot between offense and defense and execute on our long-term strategic goals.”
The company’s credit facility was jointly arranged by Wells Fargo Securities, BofA Securities, JPMorgan Chase Bank, PNC Capital Markets and Truist Securities, with Wells Fargo Bank acting as administrative agent, Wells Fargo Securities, BofA Securities and JPMorgan Chase Bank acting as joint bookrunners and Bank of America and JPMorgan Chase Bank acting as co-syndication agents. PNC Bank, Truist Bank, Morgan Stanley Senior Funding and Goldman Sachs Bank served as co-documentation agents. PJT Partners acted as the company’s financial advisor for the credit facility.
