Item 1.01 Entry Into a Material Definitive Agreement





Agreement and Plan of Merger

On May 6, 2022, Watermark Lodging Trust, Inc., a Maryland corporation ("WLT" or the "Company"), CWI 2 OP, LP, a Delaware limited partnership and the operating partnership of the Company (the "Partnership"), the named "Parent Entities," each a Delaware limited liability company, Ruby Merger Sub I LLC, a Maryland limited liability company ("Merger Sub I"), and Ruby Merger Sub II LP, a Delaware limited partnership ("Merger Sub II"), entered into an Agreement and Plan of Merger (the "Merger Agreement"). The Parent Entities, Merger Sub I and Merger Sub II are affiliates of private real estate funds managed by Brookfield (the "Guarantors"). Pursuant to the terms and subject to the conditions set forth in the Merger Agreement, at the closing of the Mergers (the "Closing"), Merger Sub II will merge with and into the Partnership (the "Partnership Merger"), and, immediately following the Partnership Merger, Merger Sub I will merge with and into the Company (the "Company Merger" and, together with the Partnership Merger, the "Mergers"). Upon completion of the Partnership Merger, the Partnership will survive and the separate existence of Merger Sub II will cease (the "Surviving Partnership"). Upon completion of the Company Merger, the Company will survive and the separate existence of Merger Sub I will cease (the "Surviving Company"). The Mergers and the other transactions contemplated by the Merger Agreement were unanimously approved by the Company's Board of Directors (the "Company Board").

Merger Consideration. Pursuant to the terms and conditions of the Merger Agreement, at the effective time of the Company Merger (the "Company Merger Effective Time"), among other things:





  · Company Shares: each share of Class A Common Stock of the Company, par value
    $0.001 per share (each, a "Company Class A Share"), that is issued and
    outstanding immediately prior to the Company Merger Effective Time will
    automatically be converted into the right to receive an amount in cash equal
    to $6.768, without interest.  Each share of Class T Common Stock of the
    Company, par value $0.001 per share (each, a "Company Class T Share," and
    together with the Company Class A Shares, the "Company Shares"), that is
    issued and outstanding immediately prior to the Company Merger Effective Time
    will automatically be converted into the right to receive an amount in cash
    equal to $6.699, without interest;

  · Series B Preferred Stock: each share of Series B Cumulative Redeemable
    Preferred Stock of the Company, par value $0.001 per share (each, a "Company
    Series B Preferred Share"), issued and outstanding immediately prior to the
    Company Merger Effective Time shall be automatically converted into the right
    to receive the optional redemption price per share determined in accordance
    with the Series B Articles Supplementary (as defined in the Merger Agreement);
    and prior to Closing, the Company will provide a notice of optional redemption
    and fundamental change to the holders of record of Company Series B Preferred
    Shares in accordance with the Series B Articles Supplementary and the Merger
    Agreement; and

  · Warrants: the outstanding warrants to purchase Class A Partnership Units (and
    any other Callable Securities (as defined in the Merger Agreement)) will be
    redeemed immediately prior to the Company Merger Effective Time at the call
    price specified in the warrant agreement governing the warrants, in accordance
    with the Merger Agreement.

Class A Partnership Units. Pursuant to the terms and conditions of the Merger Agreement, at the effective time of the Partnership Merger (the "Partnership Merger Effective Time"), each outstanding Class A Unit of the Partnership (a "Class A Partnership Unit"), other than Class A Partnership Units held by the Company, that is issued and outstanding immediately prior to the Partnership Merger Effective Time will automatically be converted into, and will be cancelled in exchange for, the right to receive $6.768 in cash, without interest (the "Per Partnership Unit Merger Consideration").

Company Restricted Stock Units. Pursuant to the terms and conditions of the Merger Agreement, immediately prior to the Company Merger Effective Time, each award of restricted stock units (each, a "Company RSU Award") that is outstanding immediately prior to the Company Merger Effective Time shall be cancelled in exchange for a payment in an amount in cash equal to (i) the number of Company Shares subject to the Company RSU Award immediately prior to the Company Merger Effective Time multiplied by (ii) $6.768 (less any applicable income and employment withholding taxes).

Closing, Closing Conditions. The consummation of the Mergers is subject to certain customary closing conditions, including, among others, (i) approval of the Company Merger by the affirmative vote of a majority of all of the votes entitled to be cast on the matter (the "Company Requisite Vote"), (ii) the absence of injunctions, orders or legal restraints that are then in effect and that have the effect of restricting, preventing or prohibiting consummation of the Mergers, (iii) as a condition to the Parent Entities', Merger Sub I's and Merger Sub II's obligations to close, the receipt by the Parent Entities of the opinion of tax counsel to the Company with respect to certain tax matters, and (iv) as a condition to the Parent Entities', Merger Sub I's and Merger Sub II's obligations to close, the absence of a Company Material Adverse Effect (as defined in the Merger Agreement) after the date of the Merger Agreement. The obligations of the parties to consummate the Mergers are not subject to any financing condition or the receipt of any financing by the Parent Entities, Merger Sub I or Merger Sub II.

Under the Merger Agreement, the Closing shall not be required to occur prior to the earlier of (i) a date specified by the Parent Entities, Merger Sub I and Merger Sub II on no less than three business days' notice; and (ii) October 21, 2022.

Representations, Warranties and Covenants. The Merger Agreement contains customary representations, warranties and covenants, including, among others, covenants requiring the Company and its subsidiaries to use commercially reasonable efforts to, in all material respects, carry on their respective businesses in the ordinary course of business and, subject to certain exceptions, restricting the Company from engaging in certain financing, acquisition and other operating activities without the Parent Entities' prior written consent (not to be unreasonably withheld, delayed or conditioned) during the period between the date of the Merger Agreement and the Partnership Merger Effective Time. The Merger Agreement requires the Company to convene a stockholders' meeting for purposes of obtaining the Company Requisite Vote, except if the Company Board effects an Adverse Recommendation Change (as defined in the Merger Agreement).

Certain Employment Matters. The Merger Agreement permits the Company to implement retention and severance arrangements with employees, including: (i) a retention plan under which up to an aggregate of $4,000,000 of retention awards will be made to employees in consideration of their agreement to stay at the Company through a post-Closing services period; (ii) a severance plan that will provide employees who do not otherwise have existing severance arrangements with severance of four months of base salary and a prorated target annual bonus if the individual's employment is terminated under certain circumstances during the 12 months after the Closing; and (iii) the acceleration of 2022 cash bonus payments to a date prior to the Closing.

Non-solicitation. Under the Merger Agreement, the Company has agreed to cease any solicitations, discussions, negotiations or communications with any person with respect to any alternative acquisition proposal; not to solicit, initiate, knowingly encourage or knowingly facilitate any inquiry, discussion, offer, request or proposal that constitutes, or could reasonably be expected to lead to, an alternative acquisition proposal; and, subject to certain exceptions, not to engage in discussions or negotiations concerning, or provide non-public information to a third party in connection with, any alternative acquisition proposal. However, the Company may, prior to obtaining the Company Requisite Vote, engage in discussions or negotiations with, and provide non-public information to, a third party which has made an unsolicited written bona fide alternative acquisition proposal, if the Company Board determines in good faith, after consultation with outside legal counsel and financial advisors, that such alternative acquisition proposal constitutes, or would reasonably be expected to lead to, a Superior Proposal (as defined in the Merger Agreement).

Prior to obtaining the Company Requisite Vote, the Company Board may, in certain circumstances, effect an Adverse Recommendation Change (as defined in the Merger Agreement), subject to complying with specified notice requirements to the Parent Entities and other conditions set forth in the Merger Agreement.

Termination of the Merger Agreement. The Merger Agreement may be terminated:

· by either party if (i) a governmental authority issues a final and

non-appealable ruling or takes other action to permanently prohibit

consummation of the Mergers, or (ii) the Mergers are not consummated on or

before November 7, 2022 (the "Outside Date"), or (iii) the Company Requisite

Vote is not obtained at the stockholders' meeting or any adjournment or . . .




Item 8.01 Other Events



Press Release

On May 6, 2022, WLT issued a press release announcing, among other things, WLT's entry into the Merger Agreement. A copy of that press release is furnished as Exhibit 99.1 hereto and is incorporated herein by reference.

The press release shall not be deemed "filed" for any purpose, including for the purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that Section. The information in this Item 8.01, including Exhibit 99.1, shall not be deemed incorporated by reference into any filing under the Securities Act or the Exchange Act regardless of any general incorporation language in the filing.

Item 9.01 Financial Statements and Exhibits





(d)  Exhibits



Exhibit No.            Description of Exhibit
  2.1                    Agreement and Plan of Merger, dated as of May 6, 2022,
                       by and among Watermark Lodging Trust, Inc., the Parent
                       Entities named therein, Ruby Merger Sub I LLC, Ruby Merger
                       Sub II LP, and CWI 2 OP, LP.*
  99.1                   Press release issued on May 6, 2022.
  99.2                   Letter from Watermark Lodging Trust, Inc. to
                       stockholders.
  99.3                   Frequently asked questions and responses by Watermark
                       Lodging Trust, Inc. for investors and financial
                       advisors.
104                    Cover Page Interactive Data File (embedded within the
                       Inline XBRL document).

* Pursuant to Item 601(a)(5) of Regulation S-K, certain schedules and exhibits

have been omitted. The registrant hereby agrees to furnish a copy of any

omitted schedule or exhibit to the SEC upon request by the SEC.

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