Park Hotels & Resorts Inc. (NASDAQ:PK) Files An 8-K Entry into a Material Definitive Agreement

Item1.01

Agreements with Hilton and HGV Related to the
Spin-Off

On January2, 2017, Park Hotels Resorts Inc. (the Company or Park)
entered into several agreements with Hilton Worldwide Holdings
Inc. (Hilton) and Hilton Grand Vacations Inc. (HGV) in connection
with the previously announced spin-off (the spin-off) of the
Company and HGV from Hilton, including the following:

Distribution Agreement. The Company entered into a
Distribution Agreement with Hilton and HGV regarding the
principal actions taken or to be taken in connection with the
spin-off. The Distribution Agreement provides for certain
transfers of assets and assumptions of liabilities by each of
Hilton, Park and HGV and the settlement or extinguishment of
certain liabilities and other obligations among Hilton, Park and
HGV. In particular, the Distribution Agreement provides that,
subject to the terms and conditions contained in the Distribution
Agreement:

In addition, notwithstanding the allocation described above, the
Company, HGV and Hilton have agreed that losses related to
certain contingent liabilities (and related costs and expenses)
that generally are not specifically attributable to any of the
separated real estate business, the timeshare business or the
retained business of Hilton (Shared Contingent Liabilities) will
be apportioned among the parties according to fixed percentages
of 65%, 26% and 9% for Hilton, Park and HGV, respectively.
Examples of Shared Contingent Liabilities may include uninsured
losses arising from actions (including derivative actions)
against current or former directors or officers of Hilton or its
subsidiaries in respect of acts or omissions occurring prior to
the completion of the spin-off, or against current or former
directors or officers of any of Hilton, Park or HGV, or any of
their respective subsidiaries, arising out of, in connection
with, or otherwise relating to, the spin-off, subject to certain
exceptions described in the Distribution Agreement. In addition,
costs and expenses of, and indemnification obligations to, third
party professional advisors arising out of the foregoing actions
also may be subject to these provisions. Subject to certain
limitations and exceptions, Hilton will generally be vested with
the exclusive management and control of all matters pertaining to
any such Shared Contingent Liabilities, including the prosecution
of any claim and the conduct of any defense. The Distribution
Agreement also provides for cross-indemnities that, except as
otherwise provided in the Distribution Agreement, are principally
designed to place financial responsibility for the obligations
and liabilities of each business with the appropriate company.

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Employee Matters Agreement. The Company entered into an
Employee Matters Agreement with Hilton and HGV that governs the
respective rights, responsibilities and obligations of Hilton,
Park and HGV after the spin-off with respect to transferred
employees, defined benefit pension plans, defined contribution
plans, non-qualified retirement plans, employee health and
welfare benefit plans, incentive plans, equity-based awards,
collective bargaining agreements and other employment,
compensation and benefits-related matters. The Employee Matters
Agreement provides for, among other things, the allocation and
treatment of assets and liabilities arising out of incentive
plans, retirement plans and employee health and welfare benefit
plans in which Park and HGV employees participated prior to the
spin-off, and continued participation by HGV and Park employees
in certain of Hiltons compensation and benefit plans for a
specified period of time following the spin-off. Generally, other
than with respect to certain specified compensation and benefit
plans and liabilities, each of Park and HGV will assume or retain
sponsorship of, and the liabilities relating to, compensation and
benefit plans and employee-related liabilities relating to its
current and former employees. The Employee Matters Agreement also
provides that outstanding Hilton equity-based awards will be
equitably adjusted or converted into Park or HGV awards, as
applicable, in connection with the spin-off. After the spin-off,
Park and HGV employees will no longer actively participate in
Hiltons benefit plans or programs (other than specified
compensation and benefit plans), and each of Park and HGV has
established or will establish plans or programs for its employees
as described in the Employee Matters Agreement. Park and HGV also
have established or will establish or maintain plans and programs
outside of the United States as may be required under applicable
law or to the Employee Matters Agreement.

Tax Matters Agreement. The Company entered into a Tax
Matters Agreement with Hilton and HGV that governs the respective
rights, responsibilities and obligations of Hilton, Park and HGV
after the spin-off with respect to tax liabilities and benefits,
tax attributes, tax contests and other tax sharing regarding U.S.
federal, state, local and foreign income taxes, other tax matters
and related tax returns. Although binding between the parties,
the Tax Matters Agreement is not binding on the IRS. Each of Park
and HGV will continue to have several liability with Hilton to
the IRS for the consolidated U.S. federal income taxes of the
Hilton consolidated group relating to the taxable periods in
which Park and HGV were part of that group. The Tax Matters
Agreement specifies the portion, if any, of this tax liability
for which Park and HGV will bear responsibility, and each party
has agreed to indemnify the other two against any amounts for
which they are not responsible. The Tax Matters Agreement also
provides special rules for allocating tax liabilities in the
event that the spin-off is not tax-free. In general, under the
Tax Matters Agreement, each party is expected to be responsible
for any taxes imposed on Hilton that arise from the failure of
the spin-off and certain related transactions to qualify as a
tax-free transaction for U.S. federal income tax purposes under
Sections 355 and 368(a)(1)(D) of the Internal Revenue Code of
1986, as amended (the Code), as applicable, and certain other
relevant provisions of the Code, to the extent that the failure
to qualify is attributable to actions taken by such party (or
with respect to such partys stock). The parties will share
responsibility in accordance with sharing percentages of 65% for
Hilton, 26% for Park, and 9% for HGV for any such taxes imposed
on Hilton that are not attributable to actions taken by a
particular party.

The Tax Matters Agreement also provides for certain covenants
that may restrict the Companys ability to pursue strategic or
other transactions that otherwise could maximize the value of its
business, including, for two years after the spin-off:

These restrictions are generally inapplicable in the event that
the IRS has granted a favorable ruling to Hilton, Park or HGV or
in the event that Hilton, Park or HGV has received an opinion
from a tax advisor, in either case to the effect that it can take
such actions without adversely affecting the tax-free status of
the spin-off and related transactions.

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Transition Services Agreement. The Company entered into
a Transition Services Agreement with Hilton and HGV under which
Hilton or one of its affiliates will provide Park and HGV with
certain services for a limited time to help ensure an orderly
transition following the spin-off. The services that Hilton
agreed to provide under the Transition Services Agreement may
include certain finance, information technology, human resources
and compensation, facilities, legal and compliance and other
services. Park and HGV will pay Hilton for any such services at
agreed amounts as set forth in the Transition Services Agreement.
In addition, for a specified term, Park or HGV and Hilton may
mutually agree on additional services that were provided by
Hilton prior to the completion of the spin-off at pricing based
on market rates reasonably agreed to by the parties.

The foregoing summaries do not purport to be complete and are
qualified in their entirety by reference to the full text of the
Distribution Agreement, Employee Matters Agreement, Tax Matters
Agreement and Transition Services Agreement, which are filed
herewith as Exhibits 2.1, 10.1, 10.2 and 10.3, respectively, to
this Current Report on Form 8-K and are incorporated by reference
into this Item1.01.

Blackstone Stockholders Agreement

In addition, in connection with the spin-off, on January2, 2017,
the Company entered into a Stockholders Agreement with certain
stockholders, including certain affiliates of The Blackstone
Group L.P. (collectively, Blackstone).

Under the Stockholders Agreement, Blackstone may designate a
number of directors equal to: (i)if Blackstone and the other
owners of Hilton prior to its December 2013 initial public
offering (collectively, pre-IPO owners) beneficially own at least
50% of Parks outstanding common stock, 50% of the total number of
directors comprising the board of directors, rounded down to the
nearest whole number; (ii)if the pre-IPO owners beneficially own
at least 40% (but less than 50%) of Parks outstanding common
stock, 40% of the total number of directors comprising the board
of directors, rounded down to the nearest whole number; (iii)if
the pre-IPO owners beneficially own at least 30% (but less than
40%) of Parks outstanding common stock, 30% of the total number
of directors comprising the board of directors, rounded down to
the nearest whole number; (iv)if the pre-IPO owners beneficially
own at least 20% (but less than 30%) of Parks outstanding common
stock, either (x)20% of the total number of directors comprising
the board of directors, rounded down to the nearest whole number,
if the total number of directors is 10 or more or (y)the lowest
whole number that is greater than 20% of the total number of
directors comprising the board of directors if the total number
of directors is less than 10; and (v)if the pre-IPO owners
beneficially own at least 5% (but less than 20%) of Parks
outstanding common stock, the lowest whole number that is greater
than 10% of the total number of directors comprising the board of
directors. The above-described provisions of the Stockholders
Agreement will remain in effect until Blackstone is no longer
entitled to nominate a director to the Stockholders Agreement,
unless Blackstone requests that they terminate at an earlier
date.

The foregoing summary does not purport to be complete and is
qualified in its entirety by reference to the full text of the
Stockholders Agreement, which is filed herewith as Exhibit 10.4
to this Current Report on Form 8-K and is incorporated by
reference into this Item1.01.

The information set forth under Item5.03 below is incorporated by
reference into this Item3.03.

The spin-off described in the Information Statement was
consummated on January3, 2017.

Certain Benefit Plans

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On January3, 2017, the Park Hotels Resorts Inc. 2017 Omnibus
Incentive Plan (the Omnibus Incentive Plan) and the Park Hotels
Resorts Inc. 2017 Stock Plan for Non-Employee Directors (the
Stock Plan for Non-Employee Directors) became effective following
their approval and adoption by the Companys board of directors
and sole stockholder, and the Park Hotels Resorts Inc. 2017
Executive Deferred Compensation Plan (the Executive Deferred
Compensation Plan) became effective following its approval and
adoption by the Companys board of directors. The material terms
of the Omnibus Incentive Plan, the Stock Plan for Non-Employee
Directors and the Executive Deferred Compensation Plan are
described in the Information Statement under the section entitled
Executive and Director CompensationPark Parent 2017 Omnibus
Incentive Plan, Executive and Director CompensationPark Hotels
Resorts Inc. 2017 Stock Plan for Non-Employee Directors and
Executive and Director CompensationNon-Qualified Deferred
Compensation, respectively, which sections the Company is filing
as Exhibit 99.1 to this Current Report on Form 8-K and which are
incorporated by reference into this Item5.02. The foregoing
summaries and incorporated descriptions of the Omnibus Incentive
Plan, the Stock Plan for Non-Employee Directors and the Executive
Deferred Compensation Plan are qualified in their entirety by
reference to the full text of the Omnibus Incentive Plan, the
Stock Plan for Non-Employee Directors and the Executive Deferred
Compensation Plan, which are filed herewith as Exhibits 10.5,
10.6 and 10.7, respectively, and are incorporated by reference
into this Item5.02.

On January3, 2017, the Companys Amended and Restated Certificate
of Incorporation (the Amended and Restated Certificate of
Incorporation), in substantially the same form previously filed
as Exhibit 3.1 to the Registration Statement, became effective
following its approval and adoption by the Companys board of
directors and sole stockholder, and the Companys Amended and
Restated By-laws (the Amended and Restated By-laws), in
substantially the same form previously filed as Exhibit3.2 to the
Registration Statement, became effective following its approval
and adoption by the Companys board of directors. Upon
effectiveness of the Amended and Restated Certificate of
Incorporation, the Companys issued and outstanding shares of
common stock were reclassified into an aggregate of 197,605,195
shares, all of which were distributed by Hilton to its
stockholders in the spin-off. A description of the material terms
of each of the Amended and Restated Certificate of Incorporation
and Amended and Restated By-laws is included in the Information
Statement under the section entitled Description of Capital Stock
which section the Company is filing as Exhibit 99.1 to this
Current Report on Form 8-K and which is incorporated by reference
into this Item5.03.

The Companys corporate governance includes the following notable
features:

The foregoing summaries and incorporated descriptions do not
purport to be complete and are qualified in their entirety by
reference to the full text of each of the Amended and Restated
Certificate of Incorporation and the Amended and Restated
By-laws, which are filed herewith as Exhibit 3.1 and Exhibit 3.2,
respectively, and are incorporated by reference into this
Item5.03.

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On January4, 2017, Hilton, Park and HGV issued a joint press
release announcing the consummation of the spin-off. The press
release is attached hereto as Exhibit 99.2.

Safe Harbor Statement

This report contains forward-looking statements intended to
qualify for the safe harbor from liability established by the
Private Securities Litigation Reform Act of 1995. Forward-looking
statements include the information concerning the Companys
possible or assumed future results of operations, business
strategies, financing plans, competitive position, potential
growth opportunities, potential operating performance
improvements, benefits resulting from its separation from Hilton,
the effects of competition and the effects of future legislation
or regulations. Forward-looking statements include all statements
that are not historical facts and can be identified by the use of
forward-looking terminology such as the words believe, expect,
plan, intend, anticipate, estimate, predict, potential, continue,
may, might, should, could or the negative of these terms or
similar expressions.

Forward-looking statements involve risks, uncertainties and
assumptions. Actual results may differ materially from those
expressed in such forward-looking statements. You should not put
undue reliance on any forward-looking statements contained
herein. The Company does not have any intention or obligation to
update forward-looking statements.

The risk factors discussed under the section entitled Risk
Factors in the Information Statement, as well as the Companys
other filings with the Securities and Exchange Commission, could
cause the Companys results to differ materially from those
expressed in forward-looking statements. There may be other risks
and uncertainties that the Company is unable to predict at this
time or that it currently does not expect to have a material
adverse effect on its business. Any such risks could cause the
Companys results to differ materially from those expressed in
forward-looking statements.

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(d)Exhibits.

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