Exhibit 10.34 Amendment to the Employee Benefits & Other Employment Matters Allocation Agreement WHEREAS, Sodexho Marriott Services, Inc. previously called Marriott International, Inc., a Delaware corporation ("Sodexho"), and Host Marriott Corporation...

 
                                                                   Exhibit 10.34


                                Amendment to the
                  Employee Benefits & Other Employment Matters
                              Allocation Agreement

                                        

          WHEREAS, Sodexho Marriott Services, Inc. previously called Marriott
International, Inc., a Delaware corporation ("Sodexho"), and Host Marriott
Corporation ("Host Marriott"), made and entered into an Employee Benefits &
Other Employment Matters Allocation Agreement (the "Allocation Agreement") as of
October 8, 1993;

          WHEREAS, the Allocation Agreement was amended as of March 27, 1998 (i)
to reflect the conversions and redenominations relating to the benefits and
awards covered by the Allocation Agreement which were necessary as a result of
certain transactions arising from the spin-off of Marriott International, Inc.,
previously called New Marriott MI, Inc., and Sodexho's acquisition of
International Catering Corporation and Sodexho Financiere du Canada, Inc., and
(ii) to add New Marriott MI, Inc. as a party to the Allocation Agreement; and

          WHEREAS, Section 5.12 of the Allocation Agreement provides that the
Allocation Agreement may be amended in writing executed by the parties; and

          WHEREAS, Host Marriott intends to enter into certain transactions
pursuant to a plan to reorganize its business operations so that it will qualify
as a real estate investment trust as of January 1, 1999 ("Host REIT
Conversion"); and

          WHEREAS, as part of the Host REIT Conversion, Host Marriott intends to
transfer the employment of certain Retained Employees to the various entities
that are or will be formed to complete the Host REIT Conversion and to transfer
substantially all its liabilities (other than liabilities relating to Crestline
Capital Corporation) to Host Marriott, L.P. ("HMLP");

          WHEREAS, pursuant to the Employee Benefits and other Employment
Matters Allocation Agreement to be entered into by and between Host Marriott,
HMLP and Crestline Capital Corporation ("New Host Agreement") (i) certain
persons who are Host Individuals (as such term is defined in the Allocation
Agreement, as amended) will become employees of Crestline Capital Corporation
("Crestline"); and (ii) certain persons who are Marriott International Employees
or Marriott Terminees (as such terms are defined in the Allocation Agreement, as
amended) and who hold awards under the Host Marriott Corporation 1997
Comprehensive Stock Incentive Plan denominated in shares of Host Marriott Common
Stock will receive Conversion Awards ("Host REIT Conversion Awards") denominated
in shares of Host REIT common stock, $.01 par value per share ("Host REIT
Stock").

 
          NOW, THEREFORE, BE IT

          RESOLVED, that the Allocation Agreement be, and it hereby is, amended
as follows, effective as of the Contribution Date:

          1.  Section 1.01 shall be amended by deleting the definitions of
Marriott International Employee of Host Individual in their entirety and
replacing them with the following:

          Marriott International Employee:  any individual who was an Employee
          --------------------------------                                    
of Marriott International (renamed Sodexho Marriott Services, Inc. after the New
Marriott Distribution Date) on the Distribution Date.

          Host Individual:  any individual who (i) is or was an employee of Host
          ----------------                                                      
Marriott Corporation or Host Marriott Services Corporation on or before the
Distribution Date, (ii) is or was an employee of Host Marriott Corporation or
its affiliates on or before the Contribution Date, or (iii) is a beneficiary of
any individual described in clause (i) or (ii).

          2.  Section 1.01 shall be amended by adding the following terms and
their definitions:

          Crestline:  Crestline Capital Corporation, a Maryland corporation.
          ----------                                                        

          Contribution Date: the Contribution Date, as defined in the New Host
          ------------------                                                  
Agreement.

          HMLP:  means Host Marriott, L.P., a Delaware limited partnership.
          -----                                                            

          Host Marriott:  Host Marriott Corporation, a Delaware corporation for
          --------------                                                       
the period before the Contribution Date and Host Marriott Corporation, a
Maryland corporation for the period beginning on or after the Contribution Date.

          HMLP:  Host Marriott, L.P., a Delaware limited partnership.
          -----                                                      

          Host REIT Conversion:  certain transactions entered into by Host
          ---------------------                                           
Marriott pursuant to a plan to reorganize its business operations so that it
will qualify as a real estate investment trust as of January 1, 1999.

          Host REIT Conversion Award:  an adjustment of an award of an option,
          ---------------------------                                         
restricted share or deferred stock under the Host REIT Stock Plan, in accordance
with Section 2.5 of the New Host Agreement.

                                       2

 
          Host REIT Conversion Entity:  the entities that will be formed prior
          ----------------------------                                        
to, substantially concurrent with or within a reasonable time after the
Contribution Date as part of the Host REIT Conversion.  A Host REIT Conversion
Entity shall include, but not be limited to, Crestline and HMLP.

          Host REIT Deferred Compensation Plan:  the Host Marriott Corporation
          -------------------------------------                               
Executive Deferred Compensation Plan, maintained by HMLP and renamed the Host
Marriott, L.P. Executive Deferred Compensation Plan following the Contribution
Date.

          Host REIT Stock:  Host Marriott Corporation common stock, $.01 par
          ----------------                                                  
value per share.

          Host REIT Stock Plan:  the HMC Comprehensive Stock Incentive Plan, as
          ---------------------                                                
defined in the New Host Agreement, as may be amended from time to time.

          New Host Agreement:  the Employee Benefits and Other Employment
          -------------------                                            
Matters Allocation Agreement to be entered into by and between Host Marriott
Corporation, Host Marriott, L.P., and Crestline Capital Corporation as part of
the Host REIT Conversion, as amended from time to time.

          3.  Section 2.03(b) shall be amended by adding a new paragraph to the
end to read as follows:

          Notwithstanding any other provision to the contrary, effective as of
          the Contribution Date, HMLP shall assume, in accordance with the New
          Host Agreement, responsibility for all liabilities and obligations of
          Host Marriott with respect to Host Individuals covered by the Host
          Marriott Corporation Executive Deferred Compensation Plan.

          4.  Section 2.03 shall be amended by adding the following new section
(d) to the end thereof:

          (d) Host REIT Conversion Terminations and Transfers.  Notwithstanding
              -----------------------------------------------                  
          any other provision to the contrary, a Host Individual shall not be
          considered to have a termination of employment or severance under the
          terms of any provision of the New Marriott Deferred Compensation Plan
          requiring continued employment if the employment of such Host
          Individual with Host Marriott or its subsidiaries is terminated as
          part of the Host REIT Conversion and immediately after the termination
          such individual is employed by a Host REIT Conversion Entity.  In
          addition, all earnings from and periods of service with a Host REIT
          Conversion Entity shall be considered in determining a Host
          Individual's benefits under the New Marriott Deferred Compensation
          Plan.

                                       3

 
          5.  Clause (i) of Section 2.05(c) shall be amended by adding the
following paragraph at the end thereof:

              Effective as of the Host REIT Conversion Date, each restricted
          share of Host Marriott Common Stock held by or on behalf of Marriott
          International Employees or Marriott Terminees and each restricted
          share of New Marriott Stock held by or on behalf of Host Individuals
          shall be subject to the terms of this Section 2.05(i), except that:
          (1) restricted shares of Host Marriott Common Stock held by or on
          behalf of Marriott International Employees or Marriott Terminees shall
          be adjusted to a Host REIT Conversion Award in accordance with the New
          Host Agreement, (2) release of restricted shares of New Marriott Stock
          held by a Host Individual who is employed by a Host REIT Conversion
          Entity shall be contingent upon a finding by the Compensation Policy
          Committee (or a delegate of such Committee) of such entity or its
          affiliate that of such individual has satisfied the conditions of such
          release, and (3) release of restrictions imposed on the Host REIT
          Conversion Awards granted pursuant to section (1) of this paragraph
          shall be contingent upon a finding by the Compensation Policy
          Committee (or a delegate of such Committee) of New Marriott that a
          grantee who is an employee of New Marriott has satisfied conditions
          for such release.

          6.  Clause (ii) of Section 2.05(c) shall be amended by adding the
following paragraph at the end thereof:

              Effective as of the Contribution Date, an award of deferred shares
          of Host Marriott Common Stock held by or on behalf of New Marriott
          Employees or on behalf of Host Individuals shall be subject to the
          terms of this Section 2.05(ii), except that: (1) an award of deferred
          shares of Host Marriott Common Stock held by or on behalf of Marriott
          International Employees or Marriott Terminees shall be adjusted to a
          Host REIT Conversion Award in accordance with the New Host Agreement,
          (2) vesting in or distribution of such shares held by a Host
          Individual who is employed by a Host REIT Conversion Entity shall be
          contingent upon a finding by the Compensation Policy Committee (or a
          delegate of such Committee) of such entity that such individual has
          satisfied the conditions of such release, and (3) release of
          restrictions imposed on the Host REIT Conversion Awards granted
          pursuant to subparagraph (1) of this paragraph shall be contingent
          upon a finding by the Compensation Policy Committee (or a delegate of
          such Committee) of New Marriott that a grantee who is an employee of
          New Marriott has satisfied the conditions for such release.

                                       4

 
          7.  Clause (iii) of Section 2.05(c) shall be amended by adding the
following paragraph at the end thereof:

              Effective as of the Contribution Date, with respect to options to
          acquire stock subject to Conversion Awards or Host REIT Conversion
          Awards service with Host Marriott or a Host REIT Conversion Entity
          shall be recognized for purposes of the terms and conditions of such
          options regarding continuing employment, termination from employment,
          approved retirement status or expiration following termination of
          employment or a leave of absence for a period of greater than 12
          months (other than a leave of absence approved by the board of
          directors (or its compensation committee) of the employer of the
          holder of the options).

          8.  Section 2.05 shall be amended by adding the following new sections
(e) and (f) to the end thereof:

              (e) Effect of Host REIT Conversion Terminations and Transfers.
                  ---------------------------------------------------------  
          Notwithstanding any other provision of this Agreement to the contrary,
          a Host Individual shall not be considered to have a termination of
          employment if such individual leaves the employ of Host Marriott or
          its affiliates to begin employment with a Host REIT Conversion Entity
          during the transition period and any service with a Host REIT
          Conversion Entity shall be considered for purposes of determining such
          individual's vesting or Service Credit.  The transition period, for
          purposes of the preceding sentence, shall mean the period beginning
          one day prior to the Contribution Date and ending 7 business days
          following the Contribution Date.  Any termination or transfer of
          employment relating to a Host Individual that is not part of or in
          relation to the Host REIT Conversion shall be treated as a termination
          of employment of such individual.

              (f) Effective as of the Contribution Date, Host Marriott shall
          take all action necessary or appropriate in accordance with the Host
          REIT Stock Plan and the New Host Agreement to provide each Marriott
          International Employee or Marriott Terminee who held an award of
          option, restricted stock or deferred stock under the Host REIT Stock
          Plan immediately before the Contribution Date with a Host REIT
          Conversion Award.

                                       5

 
          9.  Section 5.07 shall be amended by adding the following new Sections
(d) and (e) to the end thereof:

          (d) if to Crestline


              CRESTLINE CAPITAL CORPORATION
              00000 Xxxxxxxx Xxxx
              Xxxxxxxx, Xxxxxxxx  00000
              Attention:  Xxxxx Xxxxxx


          (e) if to HMLP

              HOST MARRIOTT, L.P.
              00000 Xxxxxxxx Xxxx
              Xxxxxxxx, Xxxxxxxx  00000
              Attention:  Xxxxxxxxxxx Xxxxxxxx

          10. Section 5 shall be amended by adding new Sections 5.14 and 5.15
to read as follows:

              Section 5.14 Limit on Payment. This Section 5.14 shall be
                           ----------------
          effective as of the Contribution Date. Notwithstanding any other
          provision of this Agreement to the contrary, the payments otherwise to
          be made by Marriott International or New Marriott to Host Marriott
          under this Agreement, if any, (the "Required Payments"), shall not
          exceed (i) the sum of (A) the maximum amount that can be paid to Host
          Marriott in any taxable year without causing Host Marriott to fail to
          meet the requirements of Code Sections 856(c)(2) and (3), determined
          as if the payment of such amount did not constitute income described
          in Code Sections 856(c)(2)(A)-(H) and 856(c)(3)(A)-(I) ("Qualifying
          Income") , as determined by independent accountants to Host Marriott,
          and (B) in the event Host Marriott receives a letter from outside
          counsel (the "Indemnification Payment Tax Opinion") indicating that
          Host Marriott has received a ruling from the IRS holding that Host
          Marriott's receipt of the Required Payments otherwise to be paid under
          this Agreement would either constitute Qualifying Income or would be
          excluded from gross income of Host Marriott within the meaning of Code
          Sections 856(c)(2) and (3) (the "REIT Requirements") or that the
          receipt by Host Marriott of the remaining balance of the Required
          Payments to be made under this Agreement following the receipt of and
          pursuant to such ruling would not be deemed constructively received
          prior thereto, the Required Payments less the amount otherwise paid or
          payable under clause (A) above. The obligation to pay any unpaid
          portion of any Required 

                                       6

 
          Payment shall terminate three years from the date such payment
          otherwise would have been made but for this Section 5.14. In the event
          that Host Marriott is not able to receive the full Required Payment
          that otherwise would be due under this Agreement as and when such
          payments otherwise would be required to be made, Marriott
          International or New Marriott, shall place the unpaid amount in escrow
          and shall not release any portion thereof to Host Marriott unless and
          until Marriott International or New Marriott, receive(s) either one of
          the following: (i) a letter from Host Marriott's independent
          accountants indicating the maximum amount that can be paid at that
          time to Host Marriott without causing Host Marriott to fail to meet
          the REIT Requirements or (ii) an Indemnification Payment Tax Opinion,
          in either of which events Marriott International or New Marriott shall
          pay to Host Marriott the lesser of the unpaid Required Payments or the
          maximum amount stated in the letter referred to in (i) above.

              Section 5.15  Addition of HMLP and Crestline.  Effective as of the
                            ------------------------------                      
          Contribution Date, HMLP and Crestline shall be added as parties to
          this Agreement and shall be considered as such for purposes of this
          Agreement, including but not limited for purposes of references to
          "parties".

                                       7

 
          IN WITNESS WHEREOF, the parties have executed this Amendment to the
Allocation Agreement as of December 28, 1998.


                                HOST MARRIOTT CORPORATION
                         
                         
                         
                                By:________________________________
                                Name:  Xxxxxxxxxxx X. Xxxxxxxx
                                Title:  Vice President
                         
                         
                                SODEXHO MARRIOTT SERVICES, INC.
                         
                         
                         
                                By:___________________________________
                                Name:  Xxxxxx X. Xxxxx
                                Title:  Senior Vice President and General
                                        Counsel
                         
                         
                                MARRIOTT INTERNATIONAL, INC.
                         
                         
                         
                                By:_____________________________________
                                Name:  Xxxxx X. Xxxxxx
                                Title:  Vice President
                         
                         
                                CRESTLINE CAPITAL CORPORATION
                         
                         
                         
                                By:_____________________________________
                                Name:  Xxxxx Xxxxxxxxx
                                Title:  President and Chief Executive Officer

                                       8

 
                                HOST MARRIOTT, L.P.



                                By:_____________________________________
                                Name:  Xxxxxxxxxxx X. Xxxxxxxx
                                Title:  Vice President

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