What changed in this filing

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Item 1A. Risk Factors

2024-02-29 compared with 2023-03-01 · 244 added, 163 removed, 650 unchanged (39% of the section changed)

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• Risks inherent to the timeshare and hospitality industry, including reliance on tourism and travel, and competition within the industry;

• The COVID-19 pandemic, other epidemics or pandemics, and related events, including the various measures implemented or adopted to respond to the pandemic;

• Material harm to our business if we breach our license agreement with Hilton or the agreement is terminated;

• Our ability to use the Hilton brands and trademarks and rebrand the acquired Diamond business and properties;

• Pandemics, epidemics and related events, including the various measures implemented or adopted to respond to such events;

• Material harm to our business if we breach our license agreement with Hilton and Hilton exercises any of its remedies thereunder, which may include the loss of certain rights (such as exclusivity in the timeshare business) that we have or the termination of the license agreement;

• Our ability to use the Hilton brands and trademarks and rebrand the acquired Diamond and Bluegreen business and properties, and any potential consequences under the license agreement if we fail to do so;

• The quality and reputation of the Hilton brands and affiliation with the Hilton Honors loyalty program;

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Share repurchases could also increase the volatility of the price of our common stock and diminish our cash reserves;

• The actions of activist stockholders;

• Our ability to integrate the Diamond business successfully or realize the anticipated cost savings, synergies and growth in operating results;

• Our ability to effectively manage our expanded operations resulting from the Diamond Acquisition, including the trust system associated with the Diamond business.

• Our ability to integrate the Diamond and the Bluegreen businesses successfully or realize the anticipated cost savings, synergies and growth in operating results with each such acquisition, as well as integrate strategic partnerships assumed in the Bluegreen Acquisition;

• Our ability to effectively manage our expanded operations resulting from both the Diamond Acquisition and the Bluegreen Acquisition, including the respective trust systems associated with such businesses.

The foregoing is only a summary of our risks.

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If we cannot compete successfully in these areas or if our marketing and sales efforts are not successful and we are unable to convert customers to a sufficient number of sales, this could negatively affect our operating profits and margins and our ability to recover the expense of our marketing programs and grow our business, diminish our market share and reduce our earnings.

The COVID-19 pandemic and related events have had, and may from time to time continue to have, a material adverse effect on our business, financial condition and results of operations.

The COVID-19 pandemic and the various measures taken or implemented by governments and other authorities in the United States and around the world, businesses, organizations and individuals had, and may from time to time continue to have, an adverse impact on domestic and international travel, consumer demand for travel, commercial activities across the travel, lodging and hospitality industries, businesses generally, and consequently, on our business and operations.

These measures, as well as a drop in demand for travel and leisure activities, adversely impacted our business.

In response to the pandemic, we implemented a variety of measures that are or were required, or we believe are advisable, for our business with the goal of keeping our customers, owners, team members, and the communities we serve as safe as reasonably feasible from the COVID-19 virus.

The conditions caused by the pandemic continue to be unpredictable, including as a result of new variants and governmental responses or restrictions and changes in behavior as a result.

We will continue to monitor and respond to any restrictions or recommendations of national and local governments and public health agencies related to the COVID-19 pandemic, and could be subject to similar restrictions or impacts resulting from epidemics or global pandemics in the future.

Any pandemic, epidemic and related events may have a material adverse effect on our business, financial condition and results of operations.

During the COVID-19 pandemic, governments and other authorities in the United States and around the world took and implemented unprecedented measures, and businesses, organizations and individuals, including HGV, implemented a variety of measures in response that were required or were believed to be advisable, including, without limitation, temporarily closing businesses.

The pandemic, as well as such measures, had a significant adverse impact on domestic and international travel, consumer demand for travel, commercial activities across the travel, lodging and hospitality industries, businesses generally, and consequently, on our business and operations.

Any future variant of COVID-19 and/or new pandemic or epidemic that leads to similar measures, restrictions or responses could again materially and adversely impact our business, financial condition and operating results.

Risks Related to the Operation of Our Business

We do not own the Hilton brands and our business will be materially harmed if we breach our license agreement with Hilton or it is terminated.

Following the spin-off of HGV from Hilton in January 2017, Hilton retained ownership of the Hilton-branded trademarks, tradenames and certain related intellectual property used in the operation of our business.

Following the spin-off, Hilton retained ownership of the Hilton-branded trademarks, tradenames and certain related intellectual property used in the operation of our business.

We entered into a license agreement with Hilton granting us the right to use the Hilton-branded trademarks, trade names and related intellectual property in our business for the term of the agreement.

The license agreement was amended and restated in connection with the Diamond Acquisition to facilitate our integration of the Diamond business and create a license fee structure related to the integration.

The license agreement was amended and restated in connection with the Diamond Acquisition and the Bluegreen Acquisition to facilitate our integration of the Diamond and Bluegreen businesses and create a license fee structure related to the integrations.

If we breach our obligations under the license agreement, Hilton may be entitled to terminate the license agreement or terminate our rights to use the Hilton brands and other Hilton intellectual property at properties that do not meet applicable standards and policies, or to exercise other remedies.

Pursuant to the license agreement, Hilton would be the sole owner of certain licensed marks related to any new brands associated with the Diamond portfolio that are developed by us.

Pursuant to the license agreement, Hilton would be the sole owner of certain licensed marks related to any new brands associated with the Diamond portfolio that we developed or may develop.

If the license agreement is terminated, we could lose the right to use one or more of such new brands.

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For example, if we are not able to rely on the strength of the Hilton brands to attract prospective members and guests in the marketplace, our revenue and profits would decline, and our marketing and sales expenses would increase.

If we are not able to use Hilton’s marketing databases and corporate-level advertising channels to reach potential members and guests, including Hilton’s internet address as a channel through which to market available inventory, our member growth would be adversely affected and our revenue would materially decline, and it is unlikely that we would be able to replace the revenue associated with those channels.

adversely affected and our revenue would materially decline, and it is unlikely that we would be able to replace the revenue associated with those channels.

Even if the license agreement remains in effect, the termination or restriction of our rights to use any branded trademarks, trade names and related intellectual property licensed to us by Hilton at properties that fail to meet applicable standards and policies, or any deterioration of quality or reputation of the Hilton brands (even deterioration not leading to termination of our rights under the license agreement or not caused by us), could also harm our reputation and impair our ability to market and sell our products, which could materially harm our business.

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Finally, the license agreement imposes a number of restrictions or prohibitions on our business and operations, and our ability to engage in a number of transactions, including, without limitations, acquiring or being acquired by another entity, and engaging in any lodging business or otherwise competing with Hilton, in each case without Hilton’s consent.

Any noncompliance with any of these provision may result in the termination of the license agreement, either automatically or at Hilton’s election.

Any noncompliance with any of these provisions may result in the termination of the license agreement, either automatically or at Hilton’s election.

In addition, while we are permitted under the license agreement to engage in certain other businesses, including owning and operating vacation ownership business and properties that are not Hilton-branded, in such instances, we are not permitted to use any of the rights and assets provided by Hilton under the license agreement in connection with such business and operation.

In fact, we are required to comply with various requirements to operate such business and properties as “separate operation.” However, if any such non-Hilton branded vacation ownership properties and related units exceed certain thresholds, we may lose certain rights to use the Hilton trademark, including our “Hilton Grand Vacations” corporate name.

In addition, any non-compliance with the separation operations provision may give rise to Hilton’s ability to terminate the license agreement.

In fact, we are required to comply with various requirements to operate such business and properties as separate operations.

However, if any such non-Hilton branded vacation ownership properties and related units and revenues exceed certain thresholds, we may lose certain rights, including the right related to our use of Hilton-branded trademarks, including our “Hilton Grand Vacations” corporate name.

In addition, any non-compliance with the separate operations provision may give rise to Hilton’s ability to terminate the license agreement.

Any of the foregoing and other factors that lead to Hilton’s termination of the license agreement will have a material and irreparable adverse impact on our business.

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Hilton may reject a proposed project in certain circumstances.

Any requirements to obtain Hilton’s consent to our expansion plans, including the ongoing conversion of the acquired Diamond resorts to Hilton branded properties, or the need to identify and secure alternative expansion opportunities because Hilton does not allow us to use its trademarks with proposed new projects, may delay implementation of our expansion plans, cause us to incur additional expense or reduce the financial viability of our projects.

Any requirements to obtain Hilton’s consent to our expansion plans, including the ongoing rebranding of the acquired Diamond resorts and planned rebranding of the acquired Bluegreen resorts to Hilton branded properties, or the need to identify and secure alternative expansion opportunities because Hilton does not allow us to use its trademarks with proposed new projects, may delay implementation of our expansion plans, cause us to incur additional expense or reduce the financial viability of our projects.

Further, if Hilton does not permit us to use its trademarks in connection with our expansion plans, our ability to expand our Hilton-branded timeshare business would cease and our ability to remain competitive may be materially adversely affected.

See “Our ability to integrate the acquired Diamond business could be harmed if Hilton does not consent to the use of their trademarks in connection with the conversion of Diamond resorts” and “Item 1.

See “Risks Related to the Integration of Diamond—Our ability to integrate the acquired Diamond business could be harmed if Hilton does not consent to the use of its trademarks in connection with the rebranding of Diamond resorts ,” “Risks Related to the Integration of Bluegreen—Our ability to integrate the acquired Bluegreen business could be harmed if Hilton does not consent to the use of its trademarks in connection with the rebranding of Bluegreen resorts” and “Item 1.

Business—Key Agreements with Hilton Worldwide Holdings.

Our business depends on the quality and reputation of the Hilton brands and affiliation with the Hilton Honors loyalty program.

Currently, our Legacy HGV products and services are offered under the Hilton brand names and affiliated with the Hilton Honors loyalty program, and we intend to continue to develop and offer products and services under the Hilton brands and affiliated with the Hilton Honors loyalty program in the future, including the products acquired in the Diamond Acquisition.

In addition, the license agreement contains significant prohibitions on our ability to own or operate properties that are not Hilton brand names.

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Any failure by Hilton to protect the trademarks, trade names and intellectual property that we license from it could reduce the value of the Hilton brands and also harm our business.

brands or program deteriorate or materially change in an adverse manner, or the reputation of these brands or program declines, our market share, reputation, business, financial condition or results of operations could be materially adversely affected.

If these brands or program deteriorate or materially change in an adverse manner, or the reputation of these brands or program declines, our market share, reputation, business, financial condition or results of operations could be materially adversely affected.

We rely on several critical marketing programs and activities to generate tour flow and contract sales and increase our revenues.

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We have co-invested with third parties and we may in the future co-invest with other third parties through partnerships, joint ventures or other entities, acquiring non-controlling interests in, or sharing responsibility for managing the affairs, of a timeshare property, partnership, joint venture or other entity.

These include our Elara joint venture with

Blackstone and the Bluegreen-Bass Pro joint venture that we assumed as part of the Bluegreen Acquisition.

Consequently, with respect to any such third-party arrangements, we would not be in a position to exercise sole decision-making authority regarding the property, partnership, joint venture or other entity, and may, under certain circumstances, be exposed to risks not present if a third party were not involved, including the possibility that partners or co-venturers might become bankrupt or fail to fund their share of required capital contribution.

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In addition, partners or co-venturers may have economic or other business interests or goals that are inconsistent with our business interests or goals and may be in a position to take action or withhold consent contrary to our policies or objectives.

In some instances,

partners or co-venturers may have competing interests in our markets that could create conflict of interest issues.

In some instances, partners or co-venturers may have competing interests in our markets that could create conflict of interest issues.

Disputes between us and partners or co-venturers may result in litigation or arbitration that would increase our expenses and prevent our officers from focusing their time and effort on our business.

Consequently, actions by or disputes with partners or co-venturers might result in subjecting assets owned by the partnership or joint venture, and to the extent of any guarantee our assets, to additional risk.

Consequently, actions by or disputes with partners or co-

venturers might result in subjecting assets owned by the partnership or joint venture, and to the extent of any guarantee our assets, to additional risk.

In addition, we may, in certain circumstances, be liable for the actions of our third-party partners or co-venturers.

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Our license agreement or other agreements with Hilton may require us to incur unexpected costs required to cause our properties to comply with applicable standards and policies.

In recent years, our financial results have been positively impacted by a lower interest rate environment.

Our financial results have been positively impacted by a lower interest rate environment.

However, when interest rates increase the cost of acquiring, developing, expanding or renovating real property increases, and real property values may decrease as the number of potential buyers decrease.

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These economic developments include regional economic downturns, significant increases in the number of our competitors’ products in these markets, and potentially higher labor, real estate, tax or other costs in the geographic markets in which we are concentrated.

In addition, the properties we manage are subject to the effects of adverse acts of natural or man-made

disasters, including earthquakes, windstorms, tornadoes, hurricanes, typhoons, tsunamis, volcanic eruptions, floods, drought, fires, oil spills and nuclear incidents.

Extreme weather events and adverse weather conditions, including hurricanes, flooding and forest fires, that impact the areas in which our properties are concentrated may increase in frequency and severity as a result of climate change.

In addition, our properties are subject to the effects of adverse acts of natural or man-made disasters, including earthquakes, windstorms, tornadoes, hurricanes, typhoons, tsunamis, volcanic eruptions, floods, drought, climate changes, fires, oil spills and nuclear incidents.

Extreme weather events and adverse weather conditions, including hurricanes, flooding and forest fires, that impact the areas in which our properties are concentrated may increase in

frequency and severity as a result of climate change.

Depending on the severity of these disasters, the damage could require closure of all or substantially all of these properties in one or more markets for a period of time while the necessary repairs and renovations, as applicable, are undertaken.

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Our current operations and future expansion outside of the United States make us susceptible to the risks of doing business internationally, which could lower our revenues, increase our costs, reduce our profits or disrupt our business.

We currently have timeshare properties located in the United States, Europe, Mexico, the Caribbean, Canada and Japan.

We currently have timeshare properties located in the United States, Europe, Mexico, the Caribbean, Canada and Asia.

We also market our products and services in the Asia Pacific region, primarily in Japan and South Korea.

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• exposure to litigation in foreign jurisdictions, including the expense and time necessary to litigate and the potential of adverse outcomes;

• consequences of the United Kingdom’s exit from the European Union, including new or different regulations;

• uncertainties as to local laws regarding, and enforcement of, contract and intellectual property rights;

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Over time, consumers may develop loyalties to these third-party reservation systems rather than to our booking channels.

Although we expect to

derive most of our business from traditional channels and our websites (and those of Hilton), our business and profitability could be adversely affected if customer loyalties change significantly, diverting bookings away from our distribution channels.

Although we expect to derive most of our business from traditional channels and our websites (and those of Hilton), our business and profitability could be adversely affected if customer loyalties change significantly, diverting bookings away from our distribution channels.

Changes to estimates or projections used to assess the fair value of our assets, or operating results that are lower than our current estimates at certain locations, may cause us to incur impairment losses that could adversely affect our results of operations.

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Further, we could remain obligated under guarantees or other financial obligations related to the property despite the loss of product inventory, and our members could be required to contribute toward deductibles to help cover losses.

We have identified a material weakness in our internal control over financial reporting related to Diamond.

We have identified a material weakness in our internal control over financial reporting.

If we are unable to remediate this material weakness, experience additional material weaknesses, or otherwise fail to maintain an effective system of internal control over financial reporting, we may not be able to accurately or timely report our financial results, in which case our business may be harmed, our stock price could be adversely affected, and we may otherwise experience other adverse consequences.

As a public company, we are required by Section 404 of the Sarbanes-Oxley Act to evaluate the effectiveness of our internal control over financial reporting.

We must also include a report issued by our independent registered public accounting firm based on their audit of our internal control over financial reporting.

As discussed in Part II, Item 9A of this Annual Report on Form 10-K, in connection with our year-end assessment of internal control over financial reporting, our management determined that, as of December 31, 2022, we did not maintain effective internal control over financial reporting due to a material weakness in internal control over financial reporting related to Diamond, which we acquired on August 2, 2021.

Specifically, our management concluded that Diamond, which was privately owned prior to our acquisition and, accordingly, not a reporting company under the Exchange Act, did not adequately identify, design and implement the process-level controls for its significant processes that are necessary for compliance with the requirements for reporting companies pursuant to the Exchange Act, and Diamond did not have appropriate information technology controls for its information technology systems or such controls did not operate for a sufficient period of time prior to the assessment date.

We are taking, and will continue to take, steps to enhance the risk assessment process and design and implementation of internal controls over financial reporting with respect to Diamond, including incorporating additional

controls and processes, and enhancing and revising the design of our existing financial reporting and information technology controls and procedures.

However, the material weakness will not be considered remediated until the applicable controls operate for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively.

As previously disclosed, in connection with our year-end assessment of internal control over financial reporting, our management determined that, as of December 31, 2022, we had not maintained effective internal control over financial reporting due to a material weakness in internal control over financial reporting related to Diamond, which we acquired in August 2021.

A material weakness is a deficiency, or a combination of deficiencies, in our internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis.

While such material weakness has been fully remediated, as discussed in Part II, Item 9A of this Annual Report on Form 10-K, in connection with our 2023 year-end assessment of internal control over financial reporting, our management determined that, as of December 31, 2023, we did not maintain effective internal control over financial reporting due to a material weakness in internal control over financial reporting arising out of ineffectively designed general information technology controls over user access for an IT application used to initiate revenue and inventory transactions.

As a result, process-level automated controls and manual controls that are dependent on the completeness and accuracy of information derived from the affected IT application were also ineffective.

We have commenced taking, and will continue to take, steps to enhance the risk assessment process and design and implementation of internal controls over financial reporting with respect to the user access matter, including enhancing and revising the design of our existing financial reporting and information technology controls and procedures, and incorporating additional controls and processes.

However, the material weakness will not be considered remediated until the applicable controls operate for a sufficient period of time and management has concluded, through testing, that these

controls are operating effectively.

There can be no assurances that such remediation steps will be complete in our anticipated timeframe or if they will successfully remediate the material weakness identified on a timely basis.

As a result, we may not be successful in making the improvements necessary to remediate such material weakness, be able to do so in a timely manner, or be able to identify and remediate additional control deficiencies, including material weaknesses, in the future.

Furthermore, information technology and other controls and procedures can be extensive and numerous, and there can be no assurance that our management may not uncover other deficiencies in the future that could lead to additional material weaknesses.

Any one or more of these outcomes could cause us to fail to meet our financial reporting obligations or result in material misstatements in our financial statements, which could adversely affect our business generally and lead to other adverse consequences, including, without limitation, the loss of investor confidence in us, reduction of our stock price, and exposure to litigation or government investigations and/or sanctions.

In addition, remediation plans can be costly and divert critical attention of our internal personnel and resources, which could increase our general and administrative expenses and decrease our net operating results.

Our business could be adversely impacted if we have deficiencies in our disclosure controls and procedures, including as a result of the material weakness identified by management.

The design and effectiveness of our disclosure controls and procedures are closely tied to and interdependent with our internal control over financial reporting.

Our disclosure controls and procedures, as may be updated to include additional controls and processes, and enhanced to revise the design of existing financial reporting and information technology controls and procedures as previously discussed, are designed to ensure that information we are required to disclose in the reports that we file or submit under the Exchange Act and applicable rules and regulations is recorded, processed, summarized and reported within the time periods specified in such rules and forms, and that such required information is accumulated and communicated to our management in a timely manner.

Our disclosure controls and procedures, as may be updated to include additional enhancements to the design of existing financial reporting and information technology controls and procedures, as well as adding additional controls and processes, as previously discussed, are designed to ensure that information we are required to disclose in the reports that we file or submit under the Exchange Act and applicable rules and regulations is recorded, processed, summarized and reported within the time periods specified in such rules and forms, and that such required information is accumulated and communicated to our management in a timely manner.

Nonetheless, our disclosure controls and procedures may not prevent all omissions, errors, or misstatements due to a number of factors, including, without limitation, resource constraints, benefits of the controls and procedures relative to their costs, human error and judgment, or intentional circumvention by individual acts, any of which may cause omissions, errors, or misstatements.

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Any future deterioration in the financial markets could preclude, limit, delay or increase the cost to us of future securitizations.

Instability in the financial markets could also affect the timing and volume of any securitizations we undertake, as well as the financial terms of such securitizations.

Any indebtedness we incur, including

indebtedness under these facilities, may adversely affect our ability to obtain any additional financing necessary to develop or acquire additional VOI inventory, to make other investments in our business, or to repurchase VOIs on the secondary market.

Instability in the financial markets could also affect the timing and volume of any

securitizations we undertake, as well as the financial terms of such securitizations.

Any indebtedness we incur, including indebtedness under these facilities, may adversely affect our ability to obtain any additional financing necessary to develop or acquire additional VOI inventory, to make other investments in our business, or to repurchase VOIs on the secondary market.

Furthermore, volatility in the financial markets, due to tightening of underwriting standards by lenders and credit rating agencies, among other things, could result in less availability of credit and increased costs for what is available.

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Any increases in the level of participation by timeshare owners in response to such overtures and/or delinquencies or defaults with respect to the timeshare loans owed by such owners may disrupt our business and affect cash flow from collections on the timeshare loans.

In addition, exit companies may target HGV owners to a greater extent than they already do in light of the Diamond Acquisition.

In addition, exit companies may target HGV’s owners (including Bluegreen’s and Diamond’s owners) to a greater extent than they already do in light of the larger, combined company following the Diamond Acquisition and Bluegreen Acquisition.

Disagreements with VOI owners, HOAs and other third parties may result in litigation and/or loss of management contracts.

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In addition, we may be required to devote significant resources to social media management programs, which could result in increased costs to us.

Our increasing reliance on information technology and other systems subjects us to risks associated with cyber-security.

Our increasing reliance on information technology and other systems subjects us to risks associated with cybersecurity.

Cyber-attacks or our failure to maintain the security and integrity of company, employee, associate, customer or third-party data could have a disruptive effect on our business and adversely affect our reputation and financial performance.

We rely heavily on computer, internet-based and mobile information and communications systems operated by us or our service providers to collect, process, transmit and retain large volumes of customer data, including credit card numbers and other personally identifiable information, reservation information and mailing lists, as well as personally identifiable information of our employees.

There has been an increase in the number and sophistication of criminal cyber-security attacks against companies where customer and other sensitive information has been compromised.

There has been an increase in the number and sophistication of criminal cybersecurity attacks against companies where customer and other sensitive information has been compromised.

Our information systems and records, including those we maintain with our service providers, have been, and likely will continue to be, subject to such cyber-attacks, which include efforts to hack or breach security measures in order to obtain or misuse information, phishing attempts, viruses or other malicious codes, “ransomware” or other malware.

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Any security incident, whether actual or perceived, could harm our reputation, erode customer confidence in the effectiveness of our data security measures, negatively impact our ability to attract or retain customers, or subject us to third-party lawsuits, regulatory fines or other action or liability, which could materially and adversely affect our business and operating results.

Further, the SEC has recently enacted rules requiring public companies to disclose material cybersecurity incidents that they experience on a Current Report on Form 8-K within four business days of determining that a material cybersecurity incident has occurred and to disclose on an annual basis material information regarding their cybersecurity risk management, strategy and governance.

These new reporting requirements were effective for us as of December 18, 2023.

If we fail to comply with these new requirements we could incur regulatory fines in addition to other adverse consequences to our reputation, business, financial condition and results of operations.

Our business could be subject to stricter obligations and, greater fines and private causes of action under the enactment of data privacy laws, including but not limited to, the European Union General Data Protection Regulation and the California Consumer Privacy Act.

Our systems and the systems operated by our service providers may be unable to satisfy changing regulatory requirements and customer and employee expectations and/or may require significant additional investments or time to do so.

The steps we take to deter and mitigate risks related to cyber-security may not provide the intended level of protection.

The steps we take to deter and mitigate risks related to cybersecurity may not provide the intended level of protection.

In particular, it may be difficult to anticipate or immediately detect such incidents and the damage caused thereby.

We may be required to expend significant additional resources in the future to modify and enhance our protective measures.

Although we carry cyber/privacy liability insurance that is designed to protect us against certain losses related to cyber-security risks, such insurance coverage may be insufficient to cover all losses or all types of claims that may arise in connection with cyber-attacks, security breaches, and other related breaches.

In addition, the third party service providers on which we rely face cyber-security risks, some of which may be different than the risks we face, and we do not directly control any of such service providers’ information security operations, including the efforts that they may take to mitigate risks or the level of cyber/privacy liability insurance that they may carry.

Although we carry cyber/privacy liability insurance that is designed to protect us against certain losses related to

cybersecurity risks, such insurance coverage may be insufficient to cover all losses or all types of claims that may arise in connection with cyber-attacks, security breaches, and other related breaches.

In addition, the third party service providers and partners on which we rely (including those that may be in possession of our sensitive information) face cybersecurity risks, some of which may be different than the risks we face, and we do not directly control any of such service providers’ information security operations, including the efforts that they may take to mitigate risks or the level of cyber/privacy liability insurance that they may carry.

See Part I, Item 1C.

“Cybersecurity.”

Risks Related to Legal and Regulatory Requirements

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Our properties also are subject to various federal, state and local regulatory requirements, such as state and local fire and life safety requirements.

Furthermore, various laws govern our resort management activities, including laws and regulations regarding community association management, public lodging, food and beverage services, liquor licensing, labor, employment, health care, health and safety, accessibility, discrimination, immigration, gaming and the environment (including climate change).

Our lending and related activities are also subject to a number of laws and regulations, including laws and regulations related to consumer loans, retail installment contracts, mortgage lending, fair debt collection and credit reporting practices, consumer collection practices, contacting debtors by telephone, mortgage disclosure, lender licenses and money laundering.

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If this occurs, we may not be able to develop adequate alternative marketing strategies, which could affect the amount and timing of our VOI sales.

We also obtain access to

potential members and guests from travel service providers or other companies, including Hilton;

We also obtain access to potential members and guests from travel service providers or other companies, including Hilton;

and we market to some individuals on these lists directly or through other companies’ marketing materials.

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If we fail to comply with the requirements of the GDPR, we could face significant administrative and monetary sanctions, which could materially adversely impact our results of operations and financial condition.

Changes to accounting rules or regulations may adversely affect our reported financial condition and results of operations.

New accounting rules or regulations and varying interpretations of existing accounting rules or regulations have occurred and may occur in the future.

A change in accounting rules or regulations may require retrospective application and affect our reporting of transactions completed before the change is effective, and future changes to accounting rules or regulations may adversely affect our reported financial condition and results of operations.

Organization and Basis of Presentation and 2:

Summary of Significant Accounting Policies in our consolidated financial statements included in Item 8 of this Annual Report on Form 10-K for a summary of accounting standards issued but not yet adopted.

Risks Related to Our Indebtedness

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As of December 31, 2023, our total indebtedness was approximately $4.5 billion, of which approximately $1.5 billion was non-recourse debt.

We significantly increased our level of indebtedness in connection with financing the Diamond Acquisition.

We closed an unregistered offering of $850 million in aggregate principal amount of 5.000% senior notes due 2029 and an unregistered offering of $500 million in aggregate principal amount of 4.875% senior notes due 2031.

In addition, we borrowed term loans in an initial aggregate principal amount of $1.3 billion under a new senior secured term loan credit facility to repay certain indebtedness of HGV and Diamond in connection with the closing of the Diamond Acquisition.

Finally, we assumed several of Diamond’s revolving facilities that are secured by timeshare loan receivables.

We significantly increased our level of indebtedness in connection with financing the Diamond Acquisition and the Bluegreen Acquisition.

We issued $850 million in aggregate principal amount of 5.000% senior notes due 2029 and $500 million in aggregate principal amount of 4.875% senior notes due 2031, and we borrowed term loans in an initial aggregate principal amount of $1.3 billion under a new senior secured term loan credit facility due

to repay certain indebtedness of HGV and Diamond, as part of the Diamond Acquisition.

Similarly, in connection with the Bluegreen Acquisition, we issued $900 million in aggregate principal amount of 6.625% senior notes due 2032 and borrowed term loans in an initial aggregate principal amount of $900 million due 2031.

The new term loans are subject to an interest rate of SOFR plus 2.75%.

Finally, we assumed several of Diamond’s and Bluegreen’s revolving facilities that are secured by timeshare loan receivables.

Our substantial debt and other contractual obligations could have important consequences, including:

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In addition, our credit ratings will impact the cost and availability of future borrowings and, accordingly, our cost of capital.

Our ratings will reflect each rating organization’s opinion of our financial strength, operating performance and ability to meet our debt obligations on a combined basis with Diamond.

Our ratings will reflect each rating organization’s opinion of our financial strength, operating performance and ability to meet our debt obligations on a combined basis with Diamond and Bluegreen.

Downgrades in our ratings could adversely affect our businesses, cash flows, financial condition, operating results and share and debt prices, as well as our obligations with respect to our capital-efficient inventory acquisitions.

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As a result, interest rates on our revolving credit facility or other variable rate debt offerings could be higher than current levels.

As of December 31, 2022, we had approximately $1,428 million of notional variable rate debt, representing 37% of our total indebtedness.

As of December 31, 2023, we had approximately $2.2 billion of notional variable rate debt, representing 49% of our total indebtedness.

If interest rates increase, our debt service obligations on the variable rate indebtedness would increase, even though the amount borrowed remained the same, and our net income and cash flows, including cash available for servicing our indebtedness, would correspondingly decrease.

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Debt & Non-recourse Debt of the financial statements.

Financial Conduct Authority intends to stop persuading or compelling banks to submit London Interbank Offering Rate (“LIBOR”) rates after 2022.

The administrator of LIBOR ceased the publication of all non-U.S.

dollar LIBOR and the one-week and two-month U.S.

dollar LIBOR settings immediately following the LIBOR publication on December 31, 2022, with the publication of the remaining U.S.

dollar LIBOR settings being discontinued on June 30, 2023.

It is expected that a transition away from the widespread use of LIBOR to alternative rates will occur over the course of the next several years.

We may need to amend our revolving credit facility, which utilizes LIBOR as a factor in determining the interest rate, to replace LIBOR with the new standard that is established.

There is currently no definitive information regarding the future utilization of LIBOR or of any particular replacement rate.

As such, the potential effect of any such event on our cost of capital and net investment income cannot yet be determined.

The Company has incorporated LIBOR fallback language in its credit documents in anticipation of LIBORs cessation and does not expect any material disruption of funding on its existing facilities.

Servicing our indebtedness requires a significant amount of cash.

4 unchanged sentences

If we are unable to generate and access sufficient cash flow to service our debt and meet our other commitments, we may need to restructure or refinance all or a portion of our debt, sell material assets or operations or raise additional debt or equity capital.

We may not be able to effect any of these actions on a timely basis, on commercially reasonable terms or at all, and these actions may not be sufficient to meet our capital requirements.

We may not be able to affect any of these actions on a timely basis, on commercially reasonable terms or at all, and these actions may not be sufficient to meet our capital requirements.

In addition, the terms of our existing or future debt arrangements may restrict us from effecting any of these alternatives.

11 unchanged sentences

Each subsidiary is a distinct legal entity, and, under certain circumstances, legal and contractual restrictions may limit our ability to obtain cash from our subsidiaries.

While limitations on our subsidiaries restrict their ability to pay dividends or make other intercompany payments to us, these limitations are subject to certain qualifications and exceptions.

While limitations on our subsidiaries restrict their ability to pay dividends or make other intercompany payments to us, these

limitations are subject to certain qualifications and exceptions.

In addition, certain of our subsidiaries are party to debt agreements that contain restrictions on their ability to pay dividends or make other intercompany payments to us and may in the future enter into agreements that include additional contractual restrictions on their ability to make any such payments to us.

6 unchanged sentences

To the extent new debt is added to our current debt levels, the substantial leverage risks described in the preceding six risk factors would increase.

Risks Related to the 2017 Spin-Off From Hilton

Risks Related to the Integration of Diamond

We may not be able to integrate the acquired Diamond business successfully.

We continue to integrate the Diamond business from the August 2021 closing of the Diamond Acquisition.

Despite our efforts, it is possible that the integration process could take longer than anticipated and/or could be more difficult than anticipated due to a number of reasons, including the lack of complementary products and resort offerings, delays or other challenges in converting the Diamond resorts into resorts that are suitable for HGV as part of our overall strategy and our rebranding plan, loss of valuable employees, disruption of each company’s ongoing businesses, processes and systems, inconsistencies in standards, controls, procedures, practices, policies and compensation arrangements between the two businesses, and differences in corporate cultures and philosophies, and other challenges that are inherent in such a complex integration of businesses.

There also may be issues attributable to Diamond’s operations that were inherent to the business or are based on events or actions that occurred prior to the closing of the Diamond Acquisition that may make the integration even more challenging.

In addition, uncertainty about the effect of the Diamond Acquisition on relationships with our suppliers, vendors, existing owners, and potential owners may hinder the integration.

Although we are taking steps designed to reduce or mitigate any adverse effects, these uncertainties may cause suppliers, vendors, existing and potential owners, and others that deal with us to seek to change, not renew or discontinue existing business relationships with us.

Integrating the Diamond business and properties into our operations may place a significant burden on management and internal resources and divert management’s attention away from day-to-day business concerns.

Further, our ability to attract, retain and motivate key personnel and employees may be impacted if employees or prospective employees have uncertainty about their future roles with us during the integration of the Diamond Acquisition and beyond.

Despite our retention and recruiting efforts, key employees may be unwilling to continue their employment with us, and we may be unable to timely find suitable replacements.

Ultimately, the integration process is subject to a number of uncertainties, and no assurance can be given that our integration efforts will be successful.

Any one or more of the foregoing factors may adversely affect or hinder any successful integration of the Diamond acquisition and may materially adversely impact the execution of our strategy post-acquisition, business, operations, and, ultimately, our results of operations.

Our ability to successfully integrate the Diamond business depends on our compliance with the license agreement and ability to meet certain targets under the rebrand plan.

We and Hilton have agreed to a plan to rebrand the majority of the Diamond properties, rooms and sales facilities into HGV-branded properties, rooms and sales facilities over a five-year period that includes annual and cumulative target room conversions.

The License Agreement Amendment provides for the offer and sale by HGV of its “HGV Max” branded

product that provides access across legacy HGV and both converted and unconverted Diamond properties, subject to certain conditions.

If we do not achieve the applicable annual rebranding target milestones, we will be subject to an escalated royalty fee, and if we fail to achieve cumulative targets by September 2031, Hilton may prohibit our future offering and sales of HGV Max.

In addition, the license agreement requires Hilton’s approval in connection with our anticipated rebranding of the Diamond properties into our branded HGV Max properties and/or another new brand of properties.

Hilton also has the right to review our sales, reservation and marketing activities related to HGV Max and review and approve our rebranded sales centers.

We have agreed with Hilton to operate the Diamond properties and business as a separate operation, pending the rebranding and rebranding plan, after which we expect to continue to operate certain Diamond properties that are not rebranded as a separate operation.

If we fail to comply with the separate operation requirements in connection with such part of our business, we may be subject to potential violation of the license agreement.

In addition, if we cannot come to an agreement with Hilton on how to brand and operate Diamond properties that are not approved for rebranding by Hilton, our

ability to successfully integrate Diamond may be materially adversely affected.

We may conclude that it is necessary to enter into future amendments and/or modifications to the license agreement that may be necessary in connection with the integration and rebranding plans.

If we and Hilton are unable to reach agreements on any such amendments and/or modifications, our integration and rebranding plans may be delayed and/or may not comport to the current terms and conditions of the license agreement, which will adversely affect our business and operations.

For additional information see “Item 1.

Business—Key Agreements with Hilton Worldwide Holdings.

Anticipated cost savings, synergies, growth in operating results and related benefits of the Diamond Acquisition may not be realized.

In addition, we may incur substantial costs and expenses related to the Diamond Acquisition and the integration beyond what we have anticipated, which may include unknown liabilities at the time of the closing.

Any of these factors could have a material adverse effect on our business, financial condition and results of operations.

We completed the Diamond Acquisition with the expectation that it will result in various benefits and synergies, including, among other things, operating efficiencies, and opportunities to potentially increase our revenue, sales, EBITDA, owners, and cost savings.

Achieving such anticipated benefits and synergies of the Diamond Acquisition within the expected timeframe, or at all, is subject to a number of uncertainties, including whether the businesses of HGV and Diamond can be integrated in an efficient and effective manner.

It is possible that any one or more of such benefits and synergies may not be realized, thereby significantly reducing the anticipated benefits associated with the Diamond Acquisition, and may result in higher than anticipated costs, and lower than anticipated revenue, and/or decreases in the amount of expected net income, all of which would adversely affect our future business, financial condition, and operating results.

Further, we incurred a number of fees, costs and expenses prior to completing the Diamond Acquisition and expect to continue to incur additional fees, costs and expenses associated with combining and integrating the operations of the two companies and achieving the desired benefits.

These fees, costs and expenses, which are both recurring and non-recurring, have been, and will continue to be, substantial.

Although we believe that achieving cost synergies, benefits, and other efficiencies of the Diamond Acquisition should offset such costs, fees and expenses over time, such net benefit may not be achieved in the near term, or at all.

Moreover, there may be significant potential liabilities associated with the Legacy-Diamond business that may have been unknown to us at or prior to the closing of the Diamond Acquisition, we may uncover after the closing during the integration period, or may be more significant than we believed at such time.

For example, an appeal for judgment was rendered in favor of the plaintiffs in November 2023 (with the California Supreme Court rejecting further appeals in February 2024) related to a personal injury lawsuit, O’Malley et al.

Diamond Resorts Management, Inc.

, filed against Diamond in 2015 for which we have accrued liabilities of approximately $102 million as of December 31, 2023.

While we believe existing insurance policies will cover a significant, if not substantially all, of any such liability, and we accrued liabilities related to this lawsuit (together with related insurance coverage), our insurance policies may still not cover a significant portion of the total amount.

In addition, there is no assurance that our insurance policies will, in fact, cover most of this liability or that we won’t be exposed to similar or other liabilities from the Legacy-Diamond business prior to our acquisition.

Any similarly significant but individually immaterial liabilities in the aggregate, and/or any material liability that was unknown or not estimable by us at the time of the acquisition, may have a material adverse effect on our financial condition and operating results.

See Part II — Item 8.

Financial Statements and Supplementary Data — Note 23:

Commitments and Contingencies to our consolidated financial statements included in this Annual Report on Form 10-K.

Our results will suffer if we do not effectively manage our expanded operations resulting from the Diamond Acquisition.

The size of our business increased significantly as a result of the Diamond Acquisition.

Our future success depends, in part, upon our ability to manage this expanded business, including in non-US jurisdictions where we did not have operations prior to the Diamond Acquisition, including challenges related to the management and monitoring of expanded operations and associated increased costs and complexity.

We may also need to obtain approvals of developers or HOAs in various instances to include additional resorts in the multi-resort trusts marketed, sold and managed by the acquired Diamond business (the “Diamond Collections”) or increase maintenance fees or impose additional requirements in order to meet our brand and operating standards.

There can be no assurances that we will be successful or that we will realize the expected operating efficiencies, cost savings and other benefits currently anticipated from the transaction.

In addition, there will be increased compliance and regulatory risk as a result of the expanded size of our business.

We may be subject to complaints, litigation or reputational harm due to dissatisfaction with, or concerns related to, the Diamond Acquisition from our and former Diamond owners.

Our and former Diamond VOI owners prior to the completion of the Diamond Acquisition may be concerned about the actual or perceived impact of the Diamond Acquisition and the integration on their VOIs, including the potential reduction in quality of resorts and product offerings due to the increased size of the business and addition of new owners, the potential adverse effect on the availability of access to these resorts and other disruptions during the integration period, or the potential increase or change in HOA or other fees.

The VOI owners of the acquired Diamond business may have similar concerns related to a decline in the quality of product offerings or increase in fees as a result of the Diamond Acquisition and increase in size of the business.

Complaints or litigation brought by existing owners following the completion of the Diamond Acquisition could harm our reputation, discourage potential new owners and adversely impact our results of operations.

Interests in the acquired Diamond resorts are offered through a trust system, which is subject to a number of regulatory and other requirements.

The Diamond Collections located in the United States are alternatives to traditional deeded timeshare ownership, as they create a network of available resort accommodations at multiple locations.

For those US-based Diamond Collections, title to the units available through the Diamond Collections is held in a trust or similar arrangement that is administered by an independent trustee (the “Collection Trustee”).

A purchaser of a timeshare interest in a Collection does not receive a deeded interest in any specific resort or resort accommodation but acquires a membership in the timeshare plan which is denominated by an annual or biennial allotment of points.

Owners of Diamond’s timeshare interests are allowed to use their allocated points to reserve accommodations at the various component site(s)/participating resort(s) within the Diamond Collections, thereby giving the members greater flexibility to plan their vacations.

Owners may also elect to reserve accommodations at resorts that are not part of their Collection through Diamond’s exchange programs.

The Diamond Collections are registered pursuant to, exempted from, or otherwise in compliance with, the applicable statutory requirements for the sale of timeshare plans in a growing number of jurisdictions.

Such registrations and formal exemption determinations for the Diamond Collections confirm the substantial compliance with the filing and disclosure requirements of the respective timeshare statutes by the developer of the applicable Diamond Collection.

It does not constitute the endorsement of the creation, sale, promotion or operation of the Diamond Collections by any regulatory body nor relieve the developer of a Diamond Collection or any affiliates of such developer of any duty or responsibility under other statutes or any other applicable laws.

Registration under a respective timeshare act (or other applicable law) is not a guarantee or assurance of compliance with applicable law nor an assurance or guarantee of how any judicial body may interpret the Diamond Collections’ compliance therewith.

A determination that specific provisions or operations of the Collections do not comply with relevant timeshare acts or applicable law may have a material adverse effect on the developer, the Collection Trustee and the related non-profit members association for each of the Diamond Collections.

If we are unable to successfully integrate and manage the trust system our results of operations or reputation may suffer.

Risks Related to the Integration of Bluegreen

We may be unable to realize anticipated cost savings, and we expect to incur substantial expenses related to the Bluegreen Acquisition, which could have a material adverse effect on our business, financial condition and results of operations.

While we anticipate certain cost savings from the consummation of the Bluegreen Acquisition, our ability to achieve such estimated cost savings in the timeframe described, or at all, is subject to various assumptions by our management, which may or may not be realized, as well as the incurrence of other costs in our operations that offset all or a portion of such cost savings.

As a consequence, we may not be able to realize cost savings within the timeframe expected or at all.

In addition, we may incur additional and/or unexpected costs in order to realize these cost savings.

These may include increased licensing fees, as we convert the existing Bluegreen properties and sales centers to branded properties and sales centers using the Hilton marks.

Failure to achieve the expected cost savings could significantly reduce the expected benefits associated with the Bluegreen Acquisition and adversely affect us.

In addition, we have incurred, and will continue to incur, substantial expenses in connection with the Bluegreen Acquisition.

We expect to continue to incur non-recurring costs associated with combining the operations of the two companies and achieving the desired cost savings.

These fees and costs have been, and will continue to be, substantial.

The substantial majority of non-recurring expenses have consisted of transaction costs related to the Bluegreen Acquisition and include, among others, fees paid to financial, legal and accounting advisors, employee benefit costs and filing fees.

These costs described above, as well as other unanticipated costs and expenses, could have a material adverse effect on our financial condition and operating results following the consummation of the Bluegreen Acquisition.

We may not be able to integrate successfully and many of the anticipated benefits of combining us and Bluegreen may not be realized.

We completed the Bluegreen Acquisition with the expectation that it will result in various benefits, including, among other things, operating efficiencies, potential revenue synergies, cost savings, and certain key strategic and marketing partnerships and alliances.

We may not realize the anticipated benefits on a timely basis, or at all.

Achieving the anticipated benefits of the Bluegreen Acquisition is subject to a number of risks and uncertainties, including whether our and Bluegreen’s businesses can be integrated in an efficient and effective manner, and whether such integration and achievement of cost savings could come at the expense of other aspects of our operations, including degradation of products and services.

Similarly, increased license fees and related costs associated with the integration of the two brands and any necessary modifications to the license agreement may result in increased costs and could hinder such integration.

It is possible that the integration process could take longer than anticipated and could result in the loss of valuable employees, the disruption of our ongoing business, processes and systems or inconsistencies in standards, controls, procedures, practices, policies and compensation arrangements, any of which could adversely affect our ability to achieve the anticipated benefits of the Bluegreen Acquisition.

We also may not successfully fully realize the expected benefits related to various key strategic and marketing partnerships and alliances of Bluegreen or may otherwise be constrained by existing strategic and marketing partnerships.

In particular, Bluegreen historically generated a significant portion of its new sales prospects and leads through marketing arrangements with various third parties, including Bass Pro Shops and Choice.

We have inherited and extended the exclusive marketing agreement with Bass Pro for a period of ten years to provide us with the right to market and sell vacation packages at kiosks in each of Bass Pro’s retail locations and through other means.

VOI sales to prospects and leads generated by Bluegreen marketing arrangement with Bass Pro accounted for approximately 16%, 17% and 19% of Bluegreen’s VOI sales volume during the years ended December 31, 2023, 2022 and 2021, respectively.

Bluegreen also had an exclusive strategic relationship with Choice, which we assumed, that involves several areas of its business, including a sales and marketing alliance that enabled Bluegreen to leverage Choice’ brands, customer relationships and marketing channels to sell vacation packages.

We anticipate continuing Bluegreen’s strategic relationship with Choice;

however, we have also agreed with Hilton that we would obtain certain amendments to the current agreements with Choice as part of our integration plan.

If we are not able to satisfy the license agreement requirement to rebrand the Bluegreen properties and its sales centers, it may materially affect our integration plans and Hilton may exercise certain rights that could be detrimental to us and our business.

See “We do not own the Hilton brands and our business will be materially harmed if we breach our license agreement with Hilton or it is terminated” and “Our ability to integrate the Bluegreen business depends on our ability to obtain certain concessions from a third party to allow us to rebrand the Bluegreen properties and sales centers.”

If we are unable to realize the benefits from Bluegreen’s marketing arrangements, including because Bluegreen’s significant marketing arrangements do not generate a sufficient number of prospects and leads, are terminated or not renewed, or are limited or changed in a manner adversely affecting our combined operations, we may not be able to market and sell our products and services to new owners at anticipated sales levels or at levels required in order to offset the costs associated with such marketing efforts.

Our results of operations could also be adversely affected by any issues attributable to Bluegreen’s operations that arise or are based on events or actions that occurred before the closing of the Bluegreen Acquisition.

We may have difficulty addressing possible differences in corporate cultures and management philosophies.

The integration process is subject to a number of uncertainties, and no assurance can be given that the anticipated benefits will be realized or, if realized, the timing of their realization.

Failure to achieve these and other anticipated benefits (including operating efficiencies) could result in increased costs or decreases in the amount of expected net income and could adversely affect our future business, financial condition, operating results and prospects.

Our ability to integrate the Bluegreen business depends on our ability to obtain certain concessions from a third party to allow us to rebrand the Bluegreen properties and sales centers.

In connection with the closing of the Bluegreen Acquisition, we agreed with Hilton that we would obtain certain amendments to the Choice agreements by December 31, 2024 to allow us to rebrand most of the Bluegreen properties and all of its sales centers in accordance with a rebranding schedule that we have agreed to with Hilton, and we agreed to pay Hilton certain minimum license fees related to the Bluegreen properties and sales of VOIs for years 2024 and 2025.

After 2025, assuming we have obtained the amendments referenced above, the license fees related to the Bluegreen properties and sales would revert back to a gradual ramp up that we had agreed to with Hilton.

“ Business—Key Agreements with Hilton Worldwide Holdings—Amended and Restated License Agreement.

” If we are not able to obtain such amendments within the specified timeframe, we would be obligated to pay certain minimum license fees for years 2026 to 2029.

In addition, Hilton could exercise certain rights under the license agreement that are detrimental to us,

including, without limitation, revoking our exclusive rights to use the licensed marks and to engage in vacation ownership under any Hilton marks.

Any of these consequences and/or other consequences related to the Hilton license agreement described below under “ Our ability to integrate the Bluegreen business depends on our compliance with the Hilton license agreement, including the separate operations provisions and certain prohibitions on doing business with competitors ” could adversely affect our operating results and our business generally.

Our ability to integrate the Bluegreen business depends on our compliance with the Hilton license agreement, including the separate operations provisions and certain prohibitions on doing business with competitors.

We license substantially all of the trademarks, brand names and intellectual property used in our business from Hilton under the Hilton license agreement.

We intend to offer vacation ownership products consisting of rebranded Bluegreen properties under our existing or new HGV brand.

Under the terms of the Hilton license agreement, we must obtain Hilton’s approval to use the Hilton brand names and trademarks in connection with the rebranding of the Bluegreen properties to branded properties using the Hilton marks, as well as for the branding of timeshare properties that we acquire or develop in the future.

We have agreed with Hilton to operate the Bluegreen business as a separate operation, subject to a rebranding schedule that we have agreed to with Hilton, which schedule may be modified from time to time.

In addition, we have agreed with Hilton that we would obtain certain amendment to the Choice agreements to allow us to implement the rebranding plan.

In addition, we may require additional amendments to the license agreement with Hilton to further modify various provisions of the Hilton license agreement to provide for any related approvals or relief from certain restrictions in connection with the integration of Bluegreen so as to allow us to achieve greater operating efficiency and synergy than currently provided for, and any failure to do so could adversely impact such operating efficiency and synergy.

In addition, any failure to obtain Hilton’s approval with respect to the rebranding of the Bluegreen properties and its sales centers will significantly harm our ability to integrate the Bluegreen business and its properties.

If we cannot come to an agreement with Hilton on how to brand and operate Bluegreen properties that do not currently or will not in the future meet the Hilton brand standards, then we will be required to continue to operate them as separate operations.

The Hilton license agreement provides for the automatic termination of our rights to certain Hilton brand names and trademarks should the aggregate number of units of accommodation in “Licensed Vacation Ownership Business” fall below two-thirds of the total number of units of accommodation in our entire “Vacation Ownership Business” at any time after the two-year period from the date of the closing of the Bluegreen Acquisition.

If, within this time period, we cannot successfully integrate Bluegreen into our business and obtain Hilton’s approval to use the Hilton brand names and trademarks for a sufficient number of Bluegreen accommodations, our license to use such Hilton brand names and trademarks may be automatically terminated, which could materially adversely impact our business.

In addition, our revenues from Hilton branded business must equal or exceed 67% of our total revenues;

otherwise, Hilton can terminate the noncompetition term contained in the license agreement.

Further, the Second Amendment to the Hilton license agreement established a minimum percentage of our total revenue in any calendar year that is required to be derived from the Hilton licensed business to maintain our continued exclusivity under the Hilton license agreement.

If we fail to meet such minimum percentage of revenue requirement, then Hilton would have the option to terminate our exclusivity under the Hilton license agreement, which would permit Hilton to license to other parties the trademarks, other intellectual property and certain other rights that are currently exclusively licensed to us under the Hilton license agreement.

In addition, the Hilton license agreement contains a number of prohibitions on us entering into certain agreements and arrangements, including certain enterprise-wide marketing arrangements and/or arrangements with competitors of Hilton.

If we assume or enter into such agreements or arrangements without the approval of Hilton, we may breach the Hilton license agreement.

The Hilton license agreement is critical to our business and the modification or amendment the Hilton license agreement or any exercise by Hilton of its termination or other rights under the Hilton license agreement, including the loss of exclusivity under the Hilton license agreement, could materially adversely impact our business.

We incurred substantial transaction costs in connection with the Bluegreen Acquisition.

We incurred, and expect that we will continue to incur, a number of significant, non-recurring expenses in connection with the Bluegreen Acquisition and the integration, including, without limitation, fees for third party legal, investment banking, consulting and advisory services, notes offering costs and expenses, amounts related to the repayment, termination, amendment and/or extension of Bluegreen’s indebtedness at the time of the closing, and obtaining necessary consents and approvals and combining the operations of the two companies.

These fees and costs have been, and will continue to be for some time, substantial.

Additional unanticipated costs may be incurred in our integration of Bluegreen.

Although it is expected that the elimination of certain duplicative costs, as well as the realization of other efficiencies related to the integration of the two businesses, will offset the incremental transaction related costs over time, this net benefit may not be achieved in the near term, may be delayed, or not achieved at all for a number of reasons.

We and Bluegreen may be subject to complaints, litigation or reputational harm due to dissatisfaction with, or concerns related to, the acquisition from our current owners.

Our current owners may be concerned about the actual or perceived impact of the merger on their VOIs, including related to a reduced quality of resorts and product offerings due to the increased size of the business and addition of new owners, or increase or change in homeowners' association or other fees.

Bluegreen’s legacy owners may have similar concerns related to a decline in the quality of product offerings or increase in fees as a result of the merger and increase in size of the business.

Complaints or litigation brought by existing owners could harm our reputation, discourage potential new owners and adversely impact our results of operations.

Our future results will suffer if we do not effectively manage our expanded operations and integrate Bluegreen.

Following the completion of the Bluegreen Acquisition, the size of our business has increased significantly beyond the size of either our or Bluegreen’s operations prior to the acquisition.

Our future success depends, in part, upon our ability to manage this expanded business, which will pose significant challenges for management, including challenges related to the managing and monitoring of new operations, increased costs and complexity, and increased compliance and regulatory requirements.

We may also need to obtain approvals of developers or HOAs in various instances to include additional resorts in the multi-resort trust marketed, sold and managed by Bluegreen or increase maintenance fees or impose additional requirements in order to meet our brand and operating standards.

There can be no assurances that we will be successful in implementing and/or managing any of these or other steps.

We may not be able to retain our and/or Bluegreen personnel successfully.

The success of the Bluegreen Acquisition and related integration will depend in part on our ability to retain the talents and dedication of key employees currently employed by us (including those employees whom we retained from the Diamond acquisition) and Bluegreen.

It is possible that these employees may decide not to remain with us or Bluegreen, as applicable.

If key employees terminate their employment, if an insufficient number of employees are retained, or if key employees’ performance standards materially decrease, our business may be adversely affected and management’s attention may be diverted from successfully integrating Bluegreen to hiring suitable replacements, all of which may cause our business to suffer.

In addition, we may not be able to locate suitable replacements for any key employees who leave, or offer employment to potential replacements on reasonable terms.

Bluegreen may have liabilities that exceed our estimates, and any such liabilities could adversely affect our financial results and condition.

Upon consummation of the Bluegreen Acquisition, we assumed all of Bluegreen’s liabilities, whether known or not.

Bluegreen may have various potential liabilities relating to the conduct of its business prior to the Bluegreen Acquisition, including, but not limited to, existing and potential legal claims pertaining to various areas of the Bluegreen business, tax audits, regulatory violations (including environmental violations and claims), and other liabilities that are greater than we had anticipated, were not known to us, and/or were not disclosed to us.

It is possible that these liabilities, whether currently known or unknown to us, may result in substantial losses, thereby adversely affecting our operating results and financial condition.

Interests in Bluegreen’s resorts are offered through a trust system, which is subject to a number of regulatory and other requirements.

Bluegreen’s resorts are alternatives to traditional deeded timeshare ownership, inasmuch as they create a network of available resort accommodations at multiple locations (“the Bluegreen Club”).

Title to the units available through the Bluegreen Club is held in a trust or similar arrangement that is administered by an independent trustee (the “Independent Trustee”).

A purchaser of a timeshare interest in the Bluegreen Club generally does not receive a deeded interest in any specific resort or resort accommodation, but acquires a membership in the timeshare plan which is denominated by an annual or biennial allotment of points.

Owners of Bluegreen’s timeshare interests are allowed to use their allocated points to reserve accommodations at the various component site(s)/participating resort(s) within the Bluegreen Club, thereby giving the members greater flexibility to plan their vacations.

Administering such trust structure can be complicated and requires compliance with various timeshare laws (including those laws applicable to component sites).

For example, the Bluegreen Club is required to be registered pursuant to, exempted from, or otherwise in compliance with, the applicable statutory requirements for the sale of timeshare plans in a growing number of jurisdictions.

While such registrations and formal or informal exemption determinations for the Bluegreen Club may confirm the substantial compliance with the filing and disclosure requirements of the respective timeshare statutes, it does not constitute the endorsement of the creation, sale, promotion or operation of the Bluegreen Club by any regulatory body nor relieve Bluegreen (or any developer) of any duty or responsibility under other statutes or any other applicable laws.

addition, various disclosures are required in connection with marketing and sale of timeshare interests or plans, which are required to be continually updated and current.

A determination that specific provisions or operations of the Bluegreen Club do not comply with relevant timeshare acts or applicable law may have a material adverse effect on the developer, the Independent Trustee and the related non-profit members association for each of the Bluegreen component sites or resorts.

Furthermore, any material omissions, inaccuracies or misstatements in disclosure documents may result in adverse consequences, including fines, penalties, rescission or similar rights for the purchasers, or other liabilities.

Risks Related to the Spin-Off

We may be responsible for U.S.

11 unchanged sentences

federal income tax liability.

of Hilton’s current and accumulated earnings and profits, would have a tax-free basis recovery up to the amount of their tax basis in their shares, and would have taxable gain from the sale or exchange of the shares to the extent of any excess.

Additionally, if the distribution of our common stock and/or the distribution of Park common stock do not qualify as tax-free under Section 355 of the Code, Hilton stockholders will be treated as having received a taxable dividend to the extent of Hilton’s current and accumulated earnings and profits, would have a tax-free basis recovery up to the amount of their tax basis in their shares, and would have taxable gain from the sale or exchange of the shares to the extent of any excess.

The spin-off and related transactions may expose us to potential liabilities arising out of state and federal fraudulent conveyance laws and legal distribution requirements.

21 unchanged sentences

Pursuant to the Distribution Agreement and certain other agreements, including the Tax Matters Agreement, entered into in connection with the spin-offs among Hilton and Park and us, we agreed to indemnify each of Hilton and Park from certain liabilities (including tax liabilities).

In addition to the Shared Contingent Liabilities pursuant to the Distribution Agreement, the Tax Matters Agreement governs the respective obligations of Hilton, Park and us after the

spin-off with respect to tax liabilities and benefits, tax attributes, tax contests, liability resulting from tax audits and other tax sharing regarding U.S.

In addition to the Shared Contingent Liabilities pursuant to the Distribution Agreement, the Tax Matters Agreement governs the respective obligations of Hilton, Park and us after the spin-off with respect to tax liabilities and benefits, tax attributes, tax contests, liability resulting from tax audits and other tax sharing regarding U.S.

federal, state, local and foreign income taxes, other tax matters and related tax returns.

13 unchanged sentences

The interests of certain of our stockholders may conflict with ours or yours in the future .

We have entered into a stockholders agreement with Apollo that, among other things, provides Apollo the right, under certain circumstances, to designate a certain number of directors to our board of directors.

Pursuant to the stockholders agreement, two members of our board of directors are Apollo designees, and for so long as Apollo and its affiliates continue to own specified percentages of our common stock, Apollo will be able to maintain representation on our board of directors.

Accordingly, during that period of time, Apollo may have influence with respect to our management, business plans and policies, including the appointment and removal of our officers.

We have entered into a stockholder's agreement with Apollo that, among other things, provides Apollo the right, under certain circumstances, to designate a certain number of directors to our board of directors.

Pursuant to the stockholder's agreement, two members of our board of directors are Apollo designees, and for so long as Apollo and its affiliates continue to own specified percentages of our common stock, Apollo will be able to maintain representation on our board of directors.

Accordingly, during that period of time, Apollo may have influence with respect to our management,

business plans and policies, including the appointment and removal of our officers.

For example, for so long as Apollo continues to own a significant percentage of our stock, Apollo may be able to influence whether or not a change of control of our company or a change in the composition of our board of directors occurs.

9 unchanged sentences

Among other things:

be issued without stockholder approval, and which may include super voting, special approval, dividend, or other rights or preferences superior to the rights of the holders of common stock;

• these provisions allow us to authorize the issuance of undesignated preferred stock in connection with a stockholder rights plan or otherwise, the terms of which may be established and the shares of which may be issued without stockholder approval, and which may include super voting, special approval, dividend, or other rights or preferences superior to the rights of the holders of common stock;

• these provisions prohibit stockholder action by written consent unless such action is recommended by all directors then in office;

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Share repurchases could also increase the volatility of the price of our common stock and diminish our cash reserves.

On May 4, 2022, our Board of Directors authorized a share repurchase program (the “Repurchase Program”), pursuant to which we may repurchase up to $500 million of our common stock over a two-year period through any combination of open market repurchases, accelerated share repurchases or privately negotiated transactions .

Our Board of Directors has authorized a share repurchase program (the “Repurchase Program”) pursuant to which we may repurchase our common stock through any combination of open market repurchases, accelerated share repurchases or privately negotiated transactions .

The timing and amount of repurchases of shares of our common stock, if any, will depend upon several factors, such as the market price of our common stock, general market and economic conditions, our working capital requirements and corporate strategy, the terms of our financing arrangements and applicable legal requirements.

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The existence of the Repurchase Program could cause our stock price to be higher than it would be in the absence of such a program.

Additionally, the Repurchase Program could diminish our cash reserves, which may impact our ability to finance future growth and to pursue possible future strategic opportunities.

Additionally, the Repurchase Program could diminish our cash reserves, which may impact our

ability to finance future growth and to pursue possible future strategic opportunities.

There can be no assurance that any share repurchases will enhance long-term stockholder value, and the market price of our common stock may decline below the levels at which we repurchased shares of stock.

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Our ability to pay dividends may also be limited by covenants of other indebtedness that we or our subsidiaries incur in the future.

Our business could be negatively impacted as a result of actions by activist stockholders or others.

Stockholder activism has been increasing in publicly traded companies in recent years and we are subject to the risks associated with such activism, particularly due to the recent decline in our stock price.

Our business could be negatively affected as a result of stockholder activism, which could cause us to incur significant legal fees and other costs, hinder execution of our business strategy and impact the trading value of our securities.

Additionally, stockholder activism could give rise to perceived uncertainties as to our future direction, adversely affect our relationships with key executives and business partners and make it more difficult to attract and retain qualified employees.

Any of these impacts could materially and adversely affect our business and operating results.

Risks Related to the Integration of Diamond

We may not be able to integrate the acquired Diamond business successfully.

On August 2, 2021, we completed the Diamond Acquisition.

In addition, uncertainty about the effect of the Diamond Acquisition on relationships with our suppliers, vendors, existing owners, and potential owners may hinder the integration.

Despite our retention and recruiting efforts, key employees may be unwilling to continue their employment with us and we may be unable to timely find suitable replacements.

As previously described, in April 2022, we entered into an amendment to the license agreement with Hilton to provide for a plan to rebrand the majority of the Diamond properties, rooms and sales facilities into HGV-branded properties, rooms and sales facilities over a five-year period.

If we do not achieve the applicable annual rebranding target milestones, we will be subject to an escalated royalty fee, and if we fail to achieve a cumulative target by September 2031, Hilton may prohibit our future offering and sales of HGV Max.

Ultimately, the integration process is subject to a number of uncertainties, and no assurance can be given that our integration efforts will be successful.

Our ability to successfully integrate the Diamond business depends on our compliance with the license agreement and ability to meet certain targets under the rebrand plan.

We and Hilton have agreed to a plan to rebrand the majority of the Diamond properties, rooms and sales facilities into HGV-branded properties, rooms and sales facilities over a five-year period.

The License Agreement Amendment sets forth certain annual and cumulative target room conversions.

The License Agreement Amendment provides for the offer and sale by HGV of its “HGV Max” branded product that provides access across legacy HGV and both converted and unconverted Diamond properties, subject to certain conditions.

In addition, the license agreement requires Hilton’s approval in connection with our anticipated conversion of the Diamond properties into our branded HGV Max properties and/or another new brand of properties.

Hilton also has the right to review our sales, reservation and marketing activities related to HGV Max and review and approve our rebranded sales centers.

We have agreed with Hilton to operate the Diamond properties and business as a separate operation, pending the rebranding and conversion plan, after which we expect to continue to operate certain Diamond properties that are not rebranded as a separate operation.

If we fail to comply with the separate operation requirements in connection with such part of our business, we may be subject to potential violation of the license agreement.

In addition, if we cannot come to an agreement with Hilton on how to brand and operate Diamond properties that are not approved for rebranding by Hilton, our ability to successfully integrate Diamond may be materially adversely affected.

We may conclude that it is necessary to enter into future amendments and/or modifications to the license agreement that may be necessary in connection with the integration and conversion plans.

If we and Hilton are unable to reach agreements on any such amendments and/or modifications, our integration and conversion plans may be delayed and/or may not comport to the current terms and conditions of the license agreement, which will adversely affect our business and operations.

For additional information see “Item 1.

Business—Key Agreements with Hilton Worldwide Holdings.

The license agreement contains a number of prohibitions on us entering into certain agreements and arrangements with competitors of Hilton.

As a result of the Diamond Acquisition, we assumed Diamond’s contracts with third parties, a number of which are with competitors of Hilton, which may only be utilized with respect to the non-branded portion of the business.

The license agreement provides for a cure period for agreements or arrangements related to the Diamond business that would result in a violation or breach of provisions in the license agreement.

However, to the extent we are not able to terminate such agreements within the cure period or we are unable to obtain a waiver from Hilton, we may be in default of the license agreement.

Anticipated cost savings, synergies, growth in operating results and related benefits of the Diamond Acquisition may not be realized.

Any of these factors could have a material adverse effect on our business, financial condition and results of operations.

These fees, costs and expenses, which are both recurring and non-recurring, have been, and will continue to be, substantial.

Moreover, there may be significant potential liabilities associated with the Legacy-Diamond business that we may uncover after the closing during the integration period, which may result in us incurring significant costs and expenses in the future.

Actions taken by employees associated with the Legacy-Diamond business could intentionally or unintentionally violate or fail to comply with laws and regulations that we are subject to, and such non-compliance may be attributable to us.

Such potential liabilities may have been unknown to us at prior to the closing of the Diamond Acquisition and/or more significant than we believed at such time.

Any such material unexpected costs and expenses may have a material adverse effect on our financial condition and operating results.

Our results will suffer if we do not effectively manage our expanded operations resulting from the Diamond Acquisition.

The size of our business increased significantly as a result of the Diamond Acquisition.

There can be no assurances that we will be successful or that we will realize the expected operating efficiencies, cost savings and other benefits currently anticipated from the transaction.

In addition, there will be increased compliance and regulatory risk as a result of the expanded size of our business.

We may be subject to complaints, litigation or reputational harm due to dissatisfaction with, or concerns related to, the Diamond Acquisition from our and former Diamond owners.

Interests in the acquired Diamond resorts are offered through a trust system, which is subject to a number of regulatory and other requirements.

The Diamond Collections located in the United States are alternatives to traditional deeded timeshare ownership, as they create a network of available resort accommodations at multiple locations.

A purchaser of a timeshare interest in a Collection does not receive a deeded interest in any specific resort or resort accommodation, but acquires a membership in the timeshare plan which is denominated by an annual or biennial allotment of points.

Owners may also elect to reserve accommodations at resorts that are not part of their Collection through Diamond’s exchange programs.

If we are unable to successfully integrate and manage the trust system our results of operations or reputation may suffer.

Unresolved Staff Comments

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors