Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

In connection with the previously announced acquisition of Watermark Lodging Trust, Inc. (the "Company") by private real estate funds managed by affiliates of Brookfield Asset Management Inc. (the "Mergers"), the Company has implemented certain employment arrangements that are described in the definitive proxy statement with respect to the Mergers filed by the Company with the Securities and Exchange Commission on June 15, 2022.

The Company has adopted an amended and restated retention and severance plan, effective June 17, 2022 (the "Amended Plan"), for certain employees other than the Company's chief executive officer. The Amended Plan supersedes in its entirety the Company's prior employee retention and severance plan, which became effective on November 10, 2021 (the "Prior Plan").

Under the retention portion of the Amended Plan, senior management will be entitled to (i) cash awards payable on the earlier of (x) the 18-month anniversary of the commencement of the Prior Plan and (y) the three-month anniversary of a change in control transaction involving the Company, including the Mergers, and (ii) cash awards payable within 90-180 days of either (x) the closing of the Mergers and (y) the termination of the Agreement and Plan of Merger, dated as of May 6, 2022, relating to the Mergers. Retention awards payable to the Company's named executed officers under the Amended Plan are $1,450,000 for Mr. Brendan Medzigian and $1,300,000 for Mr. Samuel Zinsmaster. These amounts include $550,000 and $400,000 that were originally awarded to Messrs. Medzigian and Zinsmaster, respectively, under the Prior Plan.

Under the severance portion of the Amended Plan, senior management will be entitled to a cash payment equal to one times their annual base salary and target annual bonus if (x) they are terminated without cause, (y) they resign voluntarily with good reason or (z) they resign voluntarily for any reason within 30 days following the 90th- or 180th-day anniversary of the closing of the Mergers. Severance awards payable to the Company's named executive officers are $866,667 for Mr. Brendan Medzigian and $800,000 for Mr. Zinsmaster (unchanged from the Prior Plan) and $900,000 that will be awarded to each of Messrs. Medzigian and Zinsmaster under the Amended Plan.

Certain employees who are not members of senior management will also participate in the Amended Plan and will be eligible to receive (i) a cash retention award payable on the earlier of (x) the 18-month anniversary of the commencement of the Amended Plan and (y) the three-month anniversary of a change in control transaction involving the Company, excluding the Mergers, and (ii) a cash payment equal to (x) 4 months of their annual base salary plus a prorated target annual bonus and (y) 4 months of continued participation in the Company's health plan, if they are terminated under specified circumstances within 12 months after a change in control transaction involving the Company, including the Mergers.

The Company entered into an amendment to the employment agreement of Mr. Michael Medzigian, dated June 21, 2022, which provides that if (i) the Mergers are completed and (ii) Mr. Medzigian is (x) terminated without cause, (y) resigns for good reason or (z) resigns following the 3-month period after the closing of the Mergers, Mr. Medzigian will receive (a) the maximum severance amount of $7,531,875 and (b) medical and dental insurance benefits for 18 months at the same cost as other employees of the Company.

If the Mergers are consummated, the Company will provide a tax gross-up payment to each of Messrs. Michael Medzigian, Brendan Medzigian and Zinsmaster if any of them receives, or will receive, transaction-based payments that trigger excise taxes in connection with the consummation of the Mergers under Section 4999 of the Internal Revenue Code of 1986, as amended, the amount of which will be sufficient to put each such individual in the net after-tax position that he would have been in had such excise taxes not become due and payable; provided that the maximum gross-up payment for Mr. Michael Medzigian will be $3 million.

The foregoing description of the Amended Plan and the amended employment agreement set forth under this Item 5.02 is not complete and is subject to, and qualified in its entirety by reference to, the full text of the documents, which are attached hereto as Exhibits 10.1 and 10.2 and incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.





(d)  Exhibits



Exhibit No.         Description of Exhibit
  10.1                Watermark Lodging Trust, Inc. Amended and Restated Employee
                    Retention and Severance Plan.*
  10.2                Amended and Restated Employment Agreement, dated June 21,
                    2022, between Watermark Lodging Trust, Inc. and Michael G.
                    Medzigian.*
104                 Cover Page Interactive Data File (embedded within the Inline
                    XBRL document).

* Certain confidential information contained in this document, marked by [***], has been omitted pursuant to Item 601(b)(10)(iv) of Regulation S-K because it is both (i) not material and (ii) is the type that the registrant customarily and actually treats as private or confidential.

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