|9 Months Ended|
Sep. 30, 2021
|Subsequent Events [Abstract]|
|Subsequent Events||Subsequent Events
Revolving Credit Facility Renewal
On October 22, 2021, the Company renewed the credit agreement governing its $1.0 billion revolving credit facility and term loan B, extending the end of the commitment period of the revolving credit facility from May 2023 to October 2026. This renewal terminated the Relief Period established by the July 15, 2020 Credit Agreement Amendment. The renewal stipulates a first lien leverage ratio financial covenant not to exceed 4.75 to 1.0 commencing with the December 31, 2021 period through June 30, 2022, after which time it will return to 4.25 to 1.0, the level in existence prior to the effective date of the Credit Agreement Amendment. The renewal also increased the interest coverage ratio (as defined in the Credit Agreement) to 2.5 to 1.0, the level existing prior to the effective date of the Credit Agreement Amendment, and eliminated restrictions regarding share repurchases, dividends, acquisitions, and the Relief Period minimum liquidity covenant.
The renewal reestablishes the annual interest rate in existence prior to the Credit Agreement Amendment which is equal to, at the Company’s option, either a base rate plus a margin ranging from 0.75% to 1.25% or LIBOR plus a margin ranging from 1.75% to 2.25%, in either case based upon the Company’s first lien leverage ratio.
Sierra Timeshare 2021-2 Receivables Funding LLC
On October 26, 2021, the Company closed on a placement of a series of term notes payable, issued by Sierra Timeshare 2021-2 Receivables Fundings LLC, with an initial principal amount of $350 million, secured by vacation ownership contract receivables and bearing interest at a weighted average coupon rate of 1.82%. The advance rate for this transaction was 98%.
Post-Closing Adjustments for the Sale of the European Vacation Rentals BusinessDuring 2019, Awaze proposed certain post-closing adjustments of $44 million related to the sale of the European vacation rentals business. On October 22, 2021, the Company entered into a letter of intent to settle these post-closing adjustment claims for an immaterial amount, one-third of which is the responsibility of Wyndham Hotels.
The entire disclosure for significant events or transactions that occurred after the balance sheet date through the date the financial statements were issued or the date the financial statements were available to be issued. Examples include: the sale of a capital stock issue, purchase of a business, settlement of litigation, catastrophic loss, significant foreign exchange rate changes, loans to insiders or affiliates, and transactions not in the ordinary course of business.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef