What changed in this filing

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Item 9A. Controls and Procedures

2025-03-03 compared with 2024-02-29 · 87 added, 54 removed, 248 unchanged (36% of the section changed)

1 unchanged sentence

Evaluation of Disclosure Controls and Procedures

Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) or our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) will prevent all errors and all fraud.

Our management, including our Chief Executive Officer and Acting Chief Financial Officer, does not expect that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) or our internal controls over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) will prevent all errors and all fraud.

A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met.

6 unchanged sentences

Also, projections of any evaluation of effectiveness of controls and procedures to future periods are subject to the risk that the controls and procedures may become inadequate because of changes in conditions, or that the degree of compliance with the controls and procedures may have deteriorated.

In accordance with Rule 13a-15(b) of the Exchange Act, as of the end of the period covered by this annual report, an evaluation was carried out under the supervision and with the participation of our management, including our Chief Executive Officer and Acting Chief Financial Officer, of the effectiveness of our disclosure controls and procedures.

Based on that evaluation, our Chief Executive Officer and Acting Chief Financial Officer concluded that our disclosure controls and procedures, as of the end of the period covered by this annual report, were effective to provide reasonable assurance that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms and is accumulated and communicated to our management, including the Chief Executive Officer and Acting Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Remediation of Previously Reported Material Weakness

As previously reported in our Annual Report on Form 10-K for the year ended December 31, 2022, we had identified a material weakness in internal control over financial reporting related Dakota Holdings, Inc.

(the “Diamond”), which we acquired in August 2021.

Specifically, we had concluded that Diamond 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.

While this material weakness did not result in any material misstatements to our financial statements for the year ended December 31, 2022, any restatements of prior period financial statements or any changes in or to previously released financial results required, since there was a reasonable possibility that it could have resulted in a material misstatement in our annual or interim consolidated financial statements that would not be detected, we determined that it constituted a material weakness.

Our management, under the oversight of the Audit Committee, fully remediated these deficiencies by enhancing and revising the design of existing financial reporting and information technology controls and procedures related to Diamond, as well as adding additional controls and processes.

As part of our remediation plan, we tested the applicable controls for a sufficient period of time and through such testing, our management has concluded that these controls were operating effectively as of December 31, 2023.

Additional Material Weakness

As of the end of the period covered by this Annual Report on Form 10-K, an evaluation was carried out under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures.

Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective as of December 31, 2023 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.

We previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 29, 2024, a material weakness in our internal controls over financial reporting for the year ended December 31, 2023, related to 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.

There were no identified material misstatements to our current year financial statements, no restatements of prior period financial statements and no changes in previously released financial results required as a result of these control deficiencies.

In addition, notwithstanding the identified material weakness, management, including our Chief Executive Officer and Chief Financial Officer, believes the consolidated financial statements included in this Annual Report on Form 10-K fairly represent in all material respects our financial condition, results of operations and cash flows at and for the periods presented in accordance with U.S.

Generally Accepted Accounting Principles.

Remediation Efforts to Address the Additional Material Weakness

Our management has commenced enhancing, and will continue to enhance, the user access control deficiencies.

This includes a comprehensive review of user access and levels across all software platforms, updating software as appropriate, updating and confirming appropriate user access levels, enhancing and revising the design of existing information technology controls and procedures, and adding additional controls and processes, as necessary.

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.

Throughout the year ended December 31, 2024, our management executed upon its previously disclosed remediation plan, which included:

(i) a comprehensive review of user access and levels across all software platforms, (ii) updating software as appropriate, (iii) updating and confirming appropriate user access levels, (iv) enhancing and revising the design of existing information technology controls and procedures, and (v) adding additional controls and processes as necessary to support internal controls over financial reporting.

Our management completed testing of the implemented controls during the quarter ended December 31, 2024, and found them to be operating effectively.

As a result, management has concluded that the material weakness in internal control over financial reporting has been remediated as of December 31, 2024.

Management’s Report on Internal Control Over Financial Reporting

1 unchanged sentence

Management's report on internal control over financial reporting is incorporated in this Item 9A by reference.

During the first quarter of 2024, we completed the Bluegreen Acquisition, which was accounted for as a business combination.

In accordance with the SEC’s published guidance, because we acquired these operations during the year, we excluded these operations from our efforts to comply with Section 404 with respect to 2024.

The acquired operations of Bluegreen Vacations Holding Corporation constituted approximately 26.0% of total assets as of December 31, 2024 and 19.8% and 15.4% of revenues and income before income taxes, respectively, for the year then ended.

The SEC’s published

guidance specifies that the period in which management may omit an assessment of an acquired business’s internal control over financial reporting from its assessment of the Company’s internal control may not extend beyond one year from the date of acquisition.

Changes in Internal Control Over Financial Reporting

Other than with respect to the remediation efforts described above related to Diamond, there were no changes in our internal control over financial reporting during the fourth quarter of 2023 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Other than changes made to integrate the Bluegreen acquisition into our controls over financial reporting, there were no other changes in our internal controls over financial reporting during the fourth quarter of 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Other Information

46 unchanged sentences

4.5 Form of 4.875% Note due 2031 (included in Exhibit 4.4).

4.6 I nde n ture, dated as of January 17, 2024, among Hilton Grand Vacations Borrower LLC, Hilton Grand Vacations Borrower Inc., Hilton Grand Vacations Inc., Hilton Grand Vacations Parent LLC, the Subsidiary Guarantors a party thereto and Wilmington Trust, National Association, as Trustee and Notes Collateral Agent.

(incorporated b y reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K (File No.

001-37794) filed on January 17, 2024).

4.7 Form of 6.625% Note due 2032 (included in Exhibit 4.6).

10.1 Tax Matters Agreement by and among Hilton Worldwide Holdings Inc., Park Hotels & Resorts Inc., Hilton Grand Vacations Inc.

12 unchanged sentences

001-37794) filed on November 7, 2023)

T hird Amendment t o Amended and Restated License Agreement, dated as of January 16, 2024, by and be tween Hilton Worldwide Holdings Inc., and Hilton Grand Vacations Inc.

(incorporated by reference to Exhibit 10.2 to the Registrant's Current Report on Form 8-K (File No.

001-37794) filed on January 17, 2024).

Second Amended and Restated License Agreement, dated as of November 6, 2024, by and between Hilton Worldwide Holdings Inc.

and Hilton Grand Vacations Inc.

(incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K (File No.

001-37794) filed on November 8, 2024).

Amended and Restated Receivables Loan Agreement, dated as of May 3, 2022, among Hilton Grand Vacations Trust I LLC, as borrower, Wells Fargo Bank, National Association, as paying agent and securities intermediary, the persons from time to time party thereto as conduit lenders, the financial institutions from time to time party thereto as committed lenders, the financial institutions from time to time party thereto as managing agents, and Bank of America, N.A., as administrative agent and structuring agent (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (File No.

001-37794 ) filed on May 4, 2022).

First Amendment to Amended and Restated Receivables Loan Agreement, effective as of August 8, 2023, by and among Hilton Grand Vacations Trust I LLC as Borrower, the financial institutions signatory thereto as Managing Agents, the financial institutions signatory thereto as Conduit Lenders, the financial institutions signatory thereto as Committed Lenders, Bank of America, N.A.

as Administrative Agent and Structuring Agent, and Computershare Trust Company N.A.

as Securities Intermediary, Paying Agent, Backup Servicer and Custodian (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly on Form 10-Q (File No.

First Amendment to Amended and Restated Receivables Loan Agreement, effective as of August 8, 2023, by and among Hilton Grand Vacations Trust I LLC , as b orrower, the financial institutions signatory thereto as m anaging a gents, the financial institutions signatory thereto as c onduit l enders, the financial institutions signatory thereto as c ommitted l enders, Bank of America, N.A.

as a dministrative a gent and s tructuring a gent, and Computershare Trust Company N.A.

as s ecurities i ntermediary, p aying a gent, b ackup s ervicer and c ustodian (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly on Form 10-Q (File No.

001-37794) filed on November 6, 2023).

O mnibus Amendment No.

2 to Amended and Restated Receivables Loan Agreement, effective as of March 22, 2024, by and among Hilton Grand Vacations Trust I LLC, as borrower, the financial institutions signatory thereto as managing agents, the financial institutions si gnatory thereto as conduit lenders, the financial institutions signatory thereto as committed lenders, Bank of America, N.A., as administrative agent, and Computershare Trust Company N.A., as securities intermediary and paying agent (incorporated by reference to Exhibit 10.3 to the Registrant's Quarterly Report on Form 10-Q (File No.

001-37794) filed on May 9, 2024).

O mnibus Amendment No.

3 to the Amended and Restated Receivables Loan Agreement, effective as of November 15, 2024, by and among Hilton Grand Vacations Trust I LLC, as borrower, the finan cial institutions signatory thereto as managing agents, the financial institutions signatory thereto as conduit lenders, the financial institutions signatory thereto as committed lenders, Bank of America, N.A., as administrative agent, and Computershare Trust Company N.A., as securities intermediary and paying agent (incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K (File No.

001-37794) filed on November 18, 2024).

10.4(a)† Hilton Grand Vacations Inc.

4 unchanged sentences

001-37794) filed on March 24, 2017).

H ilton Grand Vacations Inc.

2023 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.4 to the Registrant's Quarterly Report on Form 10-Q (file No.

001-37794) filed on May 9, 2024).

10.5† Hilton Grand Vacations Inc.

37 unchanged sentences

001-37794) filed on March 15, 2017).

10.10(b)† Form of Nonqualified Stock Option Agreement (Converted Award – 2014 Grant) under Hilton Grand Vacations Inc.

2017 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.14(b) to the Registrant’s Quarterly Report on Form 10-Q (File No.

001-37794) filed on May 4, 2017).

10.10(c)† Form of Nonqualified Stock Option Agreement (Converted Award – 2015 Grant) under Hilton Grand Vacations Inc.

2017 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.14(c) to the Registrant’s Quarterly Report on Form 10-Q (File No.

001-37794) filed on May 4, 2017).

10.10(d)† Form of Nonqualified Stock Option Agreement (Converted Award – 2016 Grant) under Hilton Grand Vacations Inc.

2017 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.14(d) to the Registrant’s Quarterly Report on Form 10-Q (File No.

001-37794) filed on May 4, 2017).

10.10(e)† Form of Nonqualified Stock Option Agreement for Mr.

Form of Nonqualified Stock Option Agreement for Mr.

Mark Wang under Hilton Grand Vacations Inc.

46 unchanged sentences

001-37794) filed on May 4, 2017).

F orm of Special Transaction Incentive Performance Cash Award Agreement under the Hilton Grand Vacations Inc.

2023 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.5 to the Registrant's Quarterly Report on Form 10-Q (File No.

001-37794) filed on May 9, 2024).

F orm of Special Transaction Incentive Performance Cash Award Agreem ent (for the CEO) under the Hilton Grand Vacations Inc.

2023 Om nibus Incentive Plan (incorporated by reference to Exhibit 10.6 to the Registrant's Quarterly Report on Form 10-Q (File No.

001-37794) filed on May 9, 2024).

F orm of Special Transaction Incentive Performance and Service-Based Restricted Stock Unit Agreement under the Hilton Grand Vacations Inc.

2023 Omnibus Incentive Plan (inc orporated by reference to Exhibit 10.7 to the Registrant's Quarterly Report on Form 10-Q (File No.

001-37794) filed on May 9, 2024).

F orm of Special Transaction In centive Performance and Service-Based Restricted Stock Unit Agreem ent (for the CEO) under the Hilton Grand Vacations Inc.

2023 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.8 to the Registrant's Quarterly Report on Form 10-Q (File No.

001-37794) filed on May 9, 2024).

10.14 Purchase Agreement, dated May 20, 2021, by and among Hilton Grand Vacations Borrower Escrow, LLC, Hilton Grand Vacations Borrower Escrow, Inc., and Hilton Grand Vacations Borrower LLC, in its capacity as guarantor of the HGV Escrow Guarantee and Deutsche Bank Securities Inc., on its own behalf and as representative of the Initial Purchasers (incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q (File No.

8 unchanged sentences

0001-37794) filed on August 3, 2021).

10.17(a) Credit Agreement, dated as of August 2, 2021, by and among Hilton Grand Vacations Parent LLC, as parent, Hilton Grand Vacations Borrower LLC, as the borrower, the guarantors from time to time party thereto and Bank of America, N.A., as administrative agent and collateral agent (incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K (File No.

Credit Agreement, dated as of August 2, 2021, by and among Hilton Grand Vacations Parent LLC, as parent, Hilton Grand Vacations Borrower LLC, as the borrower, the guarantors from time to time party thereto and Bank of America, N.A., as administrative agent and collateral agent (incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K (File No.

0001-37794) filed on August 3, 2021).

10.17(b) Amendment No.

Amendment No.

1 to the Credit Agreement, dated as of December 16, 2021, by and among Hilton Grand Vacations Parent LLC, as parent, Hilton Grand Vacations Borrower LLC, as the borrower, the guarantors from time to time party thereto and Bank of America, N.A., as administrative agent and collateral agent (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (File No.

5 unchanged sentences

Amendment No.

3 to the Credit Agreement, dated as of October 6, 2023 by and among Hilton Grand Vacations Bo r rower LLC, Hilton Grand Vacations Parent LLC, the guarantors party thereto, Bank of America N.A, as administrative agent and the Term Lenders party thereto.

10.18† Hilton Grand Vacations Inc.

Executive Deferred Compensation Plan.(incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (File No.

3 to the Credit Agreement, dated as of October 6, 2023 by and among Hilton Grand Vacations Borrower LLC, Hilton Grand Vacations Parent LLC, the guarantors party thereto, Bank of America N.A, as administrative agent and the Term Lenders party thereto (incorporated by reference to Exhibit 10.17(d) to the Registrant's Annual Report on Form 10-K (File No.

001-37794) filed on February 29, 2024).

Amendment No.

4 to the Credit Agreement, dated as of January 17, 2024, by and among Hilton Grand Vacations Parent LLC, Hilton Grand Vacations Borrower LLC, the guarantors party thereto, the lenders party thereto and Bank of America, N.A., as the administrative agent (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (File No.

001-37794) filed on January 17, 2024).

Amendment No.

5 to the Credit Agreement, dated as of April 8, 2024, by and among Hilton Grand Vacations Parent LLC, Hilton Grand Vacations Borrower LLC, the guarantors party thereto, Bank of America, N.A., as the administrative agent and the Term Lenders party thereto (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q (File No.

001-37794) filed on August 8, 2024).

Amendment No.

6 to the Credit Agreement, dated as of July 18, 2024, by and among Hilton Grand Vacations Parent LLC, Hilton Grand Vacations Borrower LLC, the guarantors party thereto, Bank of America, N.A., as the administrative agent and the Term Lenders party thereto (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q (File No.

001-37794) filed on November 7, 2024).

Hilton Grand Vacations Inc.

Incentive Program (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (File No.

Amendment No.

7 to the Credit Agreement, dated as of October 8, 2024, by and among Hilton Grand Vacations Borrower LLC, Hilton Grand Vacations Parent LLC, the guarantors party thereto and Bank of America, N.A., as the administrative agent (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (File No.

001-37794) filed on October 9, 2024).

H ilton Grand Vacations Inc.

Execu tive Deferred Compensation Plan.

(incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K (File No.

001-37794) filed on November 8, 2021).

H ilton Grand Vacations Inc.

Incentive Program (incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on F orm 8-K (File No.

001-37794) filed on March 10, 2023).

Hilton Grand Vacations Inc.

2023 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K (File No.

H ilton Grand Vacations Inc.

2023 Omnibus Incentive P lan (incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K (File No.

001-37794) filed on May 3, 2023).

Form of Restricted Stock Unit Agreement Under Hilton Grand Vacations Inc.

F orm of R estricted Stock Unit Agreement Under Hilton Grand Vacations Inc.

2023 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.2 to the Registrant's Quarterly Report on Form 10-Q (File No.

18 unchanged sentences

001-37794) filed on August 3, 2023).

21.1* Subsidiaries of the Registrant.

22 List of Issuer Subsidiaries of Guaranteed Securities and Guarantor Subsidiaries (incorporated by reference to Exhibit 22 to the Registrant’s Quarterly Report on Form 10-Q (File No.

001-37794) filed on November 6, 2023).

I nsider Trading Policy

S ubsidiaries of the Registrant.

23.1* Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm.

5 unchanged sentences

Section 1350, adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Incentive Compensation Clawback Policy.

97 Incentive Compensation Clawback Policy (incorporated by reference to Exhibit 97 to the Registrant's Annual Report on Form 10-K (File No.

001-37794) filed on February 29, 2024).

101.NS*** Inline XBRL Instance Document

9 unchanged sentences

† Denotes management contract or compensatory plan or arrangement.

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on this 29 th day of February 2024.

HILTON GRAND VACATIONS INC.

President and Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities indicated on this 29 th day of February 2024.

Chief Executive Officer

Signature Title

Wang President and Chief Executive Officer

Wang Chief Executive Officer

Wang (principal executive officer)

/s/ Daniel J.

Mathewes Senior Executive Vice President and Chief Financial Officer

Mathewes (principal financial officer)

Executive Vice President, Finance & Acting Chief Financial Officer

(principal financial officer)

/s/ Carlos Hernandez Senior Vice President and Chief Accounting Officer

4 unchanged sentences

Bacon Director

/s/ Christine Cahill Director

Christine Cahill

Johnson Director

Lazarus Director

/s/ Gail Mandel Director

/s/ Pamela H.

1 unchanged sentence

/s/ David Sambur Director

/s/ Alex van Hoek Director

Alex van Hoek

Whetsell Director

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 9A. Controls and Procedures