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February 11, 2016 2:38 PM ET

Hotels, Restaurants and Leisure

Company Overview of Diamond Resorts Corporation

Company Overview

Diamond Resorts Corporation, doing business as Diamond Resorts International, owns and manages a network of resorts in the Caribbean, Europe, and North America. The company was formerly known as Sunterra Corporation and changed its name to Diamond Resorts Corporation in October 2007. The company was founded in 1996 and is based in Las Vegas, Nevada. As of April 25, 2007, Diamond Resorts Corporation operates as a subsidiary of Diamond Resorts Holdings, LLC.

10600 West Charleston Boulevard

Las Vegas, NV 89135

United States

Founded in 1996

Phone:

702-684-8000

Fax:

702-684-8705

Key Executives for Diamond Resorts Corporation

Chief Executive Officer, President, and Manager
Age: 53
Founder and Chairman
Age: 53
Co-Founder of Sunterra Europe
Age: 51
Chief Financial Officer and Executive Vice President
Age: 55
Interim Chief Operating Officer
Compensation as of Fiscal Year 2015.

Diamond Resorts Corporation Key Developments

Diamond Resorts International, Inc. and Diamond Resorts Corporation Enter Second Amendment and First Incremental Assumption Agreement

On December 3, 2015, Diamond Resorts International, Inc. and Diamond Resorts Corporation entered into a Second Amendment and First Incremental Assumption Agreement to the Company's existing Credit Agreement, dated as of May 9, 2014 and previously amended as of December 22, 2014, with Credit Suisse AG, Cayman Islands Branch, as administrative agent and collateral agent, and lenders comprising at least 50% of the sum of all loans outstanding and unused commitments under the Credit Agreement. As contemplated by the Credit Agreement, the Second Amendment provides for an aggregate $150 million incremental term loan (in addition to the existing approximately $425 million in term loans outstanding under the Credit Agreement (collectively, the Existing Term Loan")). The Company received approximately $144 million in proceeds upon the closing of the incremental term loan, which was issued with 2.0% original issue discount and has the same interest rate and maturity date (May 9, 2021) as the Existing Term Loan. The term loans under the Credit Agreement have an interest rate, at the Company's option, of LIBOR plus 450 basis points, with a 1% floor, or an alternative base rate plus 350 basis points. For additional information regarding the Credit Agreement and its terms, see the Company's periodic reports filed with the Securities and Exchange Commission. In addition, the Second Amendment amended the Credit Agreement to, among other things, provide that the 50% sweep of Excess Cash Flow (as defined in the Credit Agreement) will step down to a 25% sweep of Excess Cash Flow when the Secured Leverage Ratio (as defined in the Credit Agreement) is greater than 1.5:1 (rather than 1:1 as originally set forth in the Credit Agreement), but equal to or less than 2:1 (rather than 1.5:1 as originally set forth in the Credit Agreement), and there will be no sweep of Excess Cash Flow when the Secured Leverage Ratio is equal to or less than 1.5:1 (rather than 1:1 as originally set forth in the Credit Agreement), and (2) include a soft call at 1.01 for a period of six months following the effective date of the Second Amendment. The proceeds of the incremental term loan, which replace a substantial portion of the approximately $167.5 million in cash paid by the Company in its previously disclosed acquisition of the vacation ownership business of Gold Key Resorts, will be used for general corporate purposes and to pay costs related to the closing of the transactions contemplated by the Second Amendment. Credit Suisse Securities (USA) LLC is acting as a lender with respect to the incremental term loan and served as the sole arranger in connection with the arrangement of the incremental term loan and the amendments to the Credit Agreement. Credit Suisse Securities (USA) LLC and certain of its affiliates are performing, have from time to time performed, and may in the future perform, various financial advisory, commercial banking and investment banking services for the Company and its affiliates in the ordinary course of business, including with respect to the Company's securitization, conduit and other financing transactions. In addition, affiliates of Guggenheim Partners, LLC (Guggenheim"), on behalf of certain investment advisory clients, purchased an approximate aggregate principal amount of $26.5 million of the $150 million in incremental term loans. Affiliates of Guggenheim that were existing lenders under the Credit Agreement received standard fees of approximately $154,000 for consenting to the Second Amendment. Mr. Zachary D. Warren is a principal of Guggenheim and, pursuant to the terms of a Director Designation Agreement, was nominated to, and serves on, the Company's board of directors.

Diamond Resorts International, Inc. and Diamond Resorts Corporation Enters into First Amendment to the Credit Agreement with Credit Suisse AG

On December 22, 2014, Diamond Resorts International, Inc. and Diamond Resorts Corporation has entered into a first amendment to the credit agreement with Credit Suisse AG, as administrative agent and collateral agent, and lenders comprising at least 50% of the sum of all loans outstanding and unused credit commitments under the credit agreement, dated as of May 9, 2014. The first amendment allows the company to make restricted payments of at least $75,000,000 (including purchases under the company’s previously announced stock repurchase program) by increasing the company’s restricted payments allowance by $50,000,000 from and after December 22, 2014, through the earlier of the day that is 100 days after December 31, 2014 and the date as of which the company’s portion of excess cash flow that could be utilized for restricted payments by the company would be finally determined by the company’s audited financial statements for the year ending December 31, 2014 in accordance with the credit agreement.

Diamond Resorts Corporation Announces Completion of Redemption of 12.00% Senior Secured Notes Due 2018

Diamond Resorts International Inc. and its indirect wholly-owned subsidiary, Diamond Resorts Corporation announced the completion of the previously announced redemption of DRC's 12.00% Senior Secured Notes due 2018. Pursuant to a previously issued redemption notice, on June 9, 2014, DRC redeemed the entire $374,440,000 outstanding principal amount of the Senior Secured Notes at a redemption price equal to approximately 108.077% of the principal amount of the Senior Secured Notes being redeemed (or $1,080.77 per $1,000 in principal amount of the Senior Secured Notes), or approximately $419 million in total, including approximately $14 million of accrued and unpaid interest up to but excluding the Redemption Date. As previously announced, the Company and DRC entered into a $470 million senior secured credit facility with Credit Suisse AG, as administrative agent and collateral agent. The Company funded the approximately $419 million redemption amount for the Senior Secured Notes with the proceeds of the term loan portion of the New Credit Facility. The Senior Secured Notes will no longer be outstanding after the Redemption Date, and other than the rights of noteholders to receive payment of the redemption amount of the Senior Secured Notes, all rights with respect to the Senior Secured Notes will cease to accrue on the Redemption Date.

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Recent Private Companies Transactions

Type
Date
Target
Merger/Acquisition
November 25, 2015
Intrawest Resort Club Group
Merger/Acquisition
August 17, 2015
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