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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of earliest event reported): December 18, 1998
MARRIOTT HOTEL PROPERTIES LIMITED PARTNERSHIP
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(Exact name of registrant as specified in its charter)
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Delaware 0-14381 52-1436985
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(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification Number)
10400 Fernwood Road, Bethesda, Maryland 20817-1109
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(Address of Principal Executive Offices) (Zip Code)
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The Registrant's telephone number, including area code: (301) 380-2070
Exhibit Index is on page 4.
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INFORMATION TO BE INCLUDED IN THE REPORT
ITEM 5: OTHER EVENTS
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On December 18, 1998, Host Marriott Corporation ("Host Marriott")
announced the declaration of a special dividend payable in either cash or common
stock of Host Marriott, at the election of each Host Marriott stockholder, a
dividend of shares of Crestline Capital Corporation, a subsidiary of Host
Marriott, and the receipt of the necessary partnership approvals to acquire
eight public limited hotel partnerships (which own 24 full-service Marriott
hotels), including Marriott Hotel Properties Limited Partnership. Host Marriott
stockholders of record at 5:00 p.m. (EST) on December 28, 1998 will be entitled
to receive the special dividend and the Crestline Capital Corporation shares to
be distributed. The press release announcing these events, which is incorporated
herein by reference, is attached hereto as Exhibit 99.1.
ITEM 7: FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
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(A) Financial statements of business acquired.
Not applicable.
(B) Pro forma financial information.
Not applicable.
(C) EXHIBITS
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Exhibit No. Description
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99.1 Press Release, dated December 18, 1998, relating to the
declaration by the Board of Directors of Host Marriott
of a special cash or stock election dividend and a
dividend of shares of Crestline Capital Corporation to
Host Marriott stockholders of record at 5:00 p.m. (EST)
on December 28, 1998 and the receipt of necessary
partnership approvals to acquire eight public limited
partnerships.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
MARRIOTT HOTEL PROPERTIES LIMITED PARTNERSHIP
Date: December 22, 1998 By: HOTEL PROPERTIES MANAGEMENT, INC.,
GENERAL PARTNER
By: /s/ Earla L. Stowe
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Name: Earla L. Stowe
Title: Vice President and
Chief Accounting Officer
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EXHIBIT INDEX
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EXHIBIT NUMBER EXHIBIT DESCRIPTION Page No.
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99.1 Press Release, dated December 18, 1998, relating to the 5
declaration by the Board of Directors of Host Marriott of a
special cash or stock election dividend and a dividend of
shares of Crestline Capital Corporation to Host Marriott
stockholders of record at 5:00 p.m. (EST) on December 28,
1998 and the receipt of necessary partnership approvals to
acquire eight public limited partnerships.
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EXHIBIT 99.1
Host Marriott NEWS RELEASE
Corporation 10400 Fernwood Road
Bethesda, MD 20817
Contact: Geof Wendt
Host Marriott Corporation
(301) 380-5694
HOST MARRIOTT CORPORATION ANNOUNCES SPECIAL CASH OR STOCK ELECTION DIVIDEND,
SPINOFF OF CRESTLINE CAPITAL CORPORATION AND PARTNERSHIP APPROVAL TO ACQUIRE
EIGHT PUBLIC LIMITED HOTEL PARTNERSHIPS (24 FULL-SERVICE MARRIOTT HOTELS)
BETHESDA, MD, December 18, 1998 - Host Marriott Corporation (NYSE:HMT) announced
today that, in connection with its previously announced plan to convert into a
real estate investment trust (REIT), its Board of Directors has declared a
special dividend payable in either cash or common stock of Host Marriott, at the
election of each Host Marriott stockholder, and a dividend of shares of common
stock of Crestline Capital Corporation, a Maryland corporation and subsidiary of
Host Marriott (Crestline). Both of these dividends are taxable to Host Marriott
stockholders. As announced earlier this week at a special meeting of
stockholders held on December 15, 1998, the stockholders of Host Marriott
overwhelmingly approved a Merger Agreement, pursuant to which, among other
things, Host Marriott would reincorporate in Maryland through a merger into its
wholly owned subsidiary, HMC Merger Corporation (Host REIT), as part of the REIT
conversion.
The special cash or stock election dividend and the spin-off of
Crestline are being made because, in order to qualify as a REIT for federal
income tax purposes, Host Marriott is required to distribute to its stockholders
all accumulated "earnings and profits," as determined for tax purposes, of Host
Marriott prior to the end of the first taxable year for which the REIT election
is effective. Both of these dividends count toward this requirement. Host
Marriott also is required as a REIT to lease its hotels to a third party lessee
which will be Crestline.
The special election dividend will entitle each Host Marriott
stockholder of record at 5:00 p.m. (EST) on December 28, 1998, to elect to
receive either $1.00 in cash or .087 of a share of common stock of Host Marriott
(which implies a value of $11.50 per share) for each outstanding share of Host
Marriott common stock owned by such stockholder on the record date. Election
forms are expected to be mailed on or about December 31, 1998 to the Host
Marriott stockholders of record entitled to the special election dividend. The
cash or stock election, which is irrevocable, must be exercised prior to
5:00 p.m. (EST) on January 22,
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1999. Any stockholder who fails to make a timely election will receive common
stock of Host Marriott. The cash or stock elected in the special election
dividend will be paid on or about January 27, 1999, with cash being paid in lieu
of fractional shares. Assuming the expected merger of Host Marriott into Host
REIT is completed, stockholders of Host Marriott who elect to receive stock in
the special election dividend will receive common stock of Host REIT. Any
stockholder whose ownership of Host REIT common stock would exceed the ownership
limit in Host REIT's charter as a result of electing to receive stock will be
entitled to receive only cash in the special election dividend.
The Board of Directors also approved the spin-off of Crestline by
declaring a dividend to Host Marriott stockholders of record at 5:00 p.m. (EST)
on December 28, 1998 of one share of common stock of Crestline for each
10 shares of common stock of Host Marriott owned by such stockholder on the
record date. Cash will be paid in lieu of fractional shares. The distribution
date is 9:00 a.m. (EST) on December 29, 1998, with the mailing of Crestline
stock certificates and checks for cash in lieu of fractional shares to Host
Marriott stockholders of record to commence on that date. Crestline currently
will be engaged in three business lines: leasing and subleasing full-service and
limited-service hotels from Host REIT and others; asset management of hotels and
senior living assets; and ownership of one of the premier portfolios of senior
living assets in the country. Crestline will be the largest and best
capitalized independent hotel leasing company. Crestline's common stock has
been approved for listing on the New York Stock Exchange under the symbol "CLJ."
Based on the number of currently outstanding shares of Host Marriott
common stock, approximately 20.6 million shares of Crestline common stock will
be distributed to Host Marriott stockholders of record, representing
approximately 93.6% of the shares of Crestline common stock to be outstanding
following the distribution. The remaining approximately 1.4 million shares of
Crestline common stock are expected to be transferred by Host REIT's operating
partnership in connection with its expected acquisition of 12 luxury full-
service hotel properties and other assets from The Blackstone Group and its
affiliates. In the unanticipated event the Blackstone acquisition is not
completed, then the shares of Crestline common stock distributed to Host
Marriott stockholders of record would represent 100% of the outstanding
Crestline common stock.
Host Marriott also announced today that is has received the necessary
partner approvals to acquire eight public limited partnership that own 24 full-
service Marriott hotels as part of the REIT conversion. These partnerships are
Atlanta Marriott Marquis II Limited Partnership (owner of the Atlanta Marriott
Marquis Hotel), Desert Springs Marriott Limited Partnership (owner of Marriott's
Desert Springs Resort and Spa), Hanover Marriott Limited Partnership (owner of
the Hanover Marriott Hotel), Marriott Diversified American Hotels, L.P. (owner
of the Dayton Marriott Hotel, Fairview Park Marriott Hotel, Fullerton Marriott
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Hotel, Livonia Marriott Hotel, Marriott Hotel at Research Triangle Park and
Southfield Marriott Hotel), Marriott Hotel Properties Limited Partnership (owner
of Marriott's Orlando World Center and Marriott's Harbor Beach Resort), Marriott
Hotel Properties II Limited Partnership (owner of the Marriott Rivercenter
Hotel, New Orleans Marriott Hotel, San Ramon Marriott Hotel and a controlling
interest in the Santa Clara Marriott Hotel), Mutual Benefit Chicago Marriott
Suite Hotel Partners, L.P. (owner of the Marriott Suites O'Hare) and Potomac
Hotel Limited Partnership (owner of the Albuquerque Marriott Hotel, Greensboro -
High Point Marriott Hotel, Houston Marriott Medical Center Hotel, Marriott
Mountain Shadows Resort, Miami Biscayne Bay Hotel, Raleigh Marriott Hotel,
Seattle Sea-Tac Airport, Marriott Hotel and Tampa Westshore Marriott Hotel).
Terence C. Golden, president and chief executive officer of Host
Marriott, stated, "We believe that the REIT structure will be very beneficial to
our company and our stockholders and are looking forward to its completion as
soon as possible. I am very pleased with our extraordinary efforts in making
substantial progress toward completing the REIT conversion by year-end. Our
goal is to have the company positioned to elect REIT status effective January 1,
1999. We currently expect to consummate the merger of Host Marriott into Host
REIT on December 29, 1998, and to close the Blackstone acquisition, the public
partnership rollups and other hotel property acquisitions on December 30, 1998.
While we still have a number of conditions to satisfy, we are diligently working
towards completion of these transactions by year-end."
Host Marriott Corporation is a lodging real estate company, which owns
104 upscale, and luxury full-service hotel properties primarily operated under
Marriott and Ritz-Carlton brand names. Additionally, the Company through
Crestline owns 31 senior living communities, all of which are operated by
Marriott International. The Company also currently serves as general partner
and holds minority interests in various unconsolidated partnerships which own
240 lodging properties, 20 of which are full-service hotels.
For further information on Host Marriott Corporation, please visit our
Website at http:\\www.hostmarriott.com.
Certain matters discussed in this press release include forward-
looking statements within the meaning of the Private Litigation Reform Act of
1995. All forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual transactions,
results, performance or achievements to be materially different from any future
transactions, results, performance or achievements expressed or implied by such
forward-looking statements. Certain of the transactions described herein are
subject to certain consents of shareholders, lenders, debt holders and partners
of Host Marriott and its affiliates and of other third parties and various other
conditions and contingencies, and future results, performance and achievements
will be affected by
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general economic, business and financing conditions, competition and
governmental actions. The cautionary statements set forth in reports filed under
the Securities Exchange Act of 1934 contain important factors with respect to
such forward-looking statements including: (i) national and local economic and
business conditions that will, among other things, affect demand for hotels and
other properties, the level of rates and occupancy that can be achieved by such
properties and the availability and terms of financing; (ii) the ability to
maintain the properties in a first-class manner (including meeting capital
expenditure requirements); (iii) the ability to compete effectively in areas
such as access, location, quality of accommodations and room rate structures;
(iv) the ability to acquire or develop additional properties and risk that
potential acquisitions or developments may not perform in accordance with
expectations; (v) the ability to obtain required consents of shareholders,
lenders, debtholders, partners and ground lessors in connection with the
Company's proposed conversion to a real estate investment trust (REIT) and to
consummate all of the transactions constituting the REIT conversion (including
the Blackstone acquisition); (vi) changes in travel patterns, taxes and
government regulations; (vii) governmental approvals, actions and initiatives;
(viii) the effects of tax legislative action; (ix) the effect on the Company of
the Year 2000 issues; and (x) the timing of the Company's election to be taxed
as a REIT and the ability to satisfy complex rules in order to qualify for
taxation as a REIT for federal income tax purposes and to operate effectively
within the limitations imposed by these rules. Although the Company believes the
expectations reflected in such forward-looking statements are based upon
reasonable assumptions, it can give no assurance that its expectations will be
attained or that any deviations will not be material. The Company undertakes no
obligation to publicly release the result of any revisions to these forward-
looking statements that may be made to reflect any future events or
circumstances.
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