EXHIBIT 14
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April 13, 1999
Reference is hereby made to (i) that certain Agreement of Limited
Partnership of Berkshire Realty Holdings, L.P. dated as of the date hereof
(as it may be amended, modified or supplemented from time to time, the
"Partnership Agreement") and (ii) that certain commitment letter dated as of
the date hereof (the "Bridge Loan Commitment Letter") issued by Whitehall
Street Real Estate Limited Partnership XI and Blackstone Real Estate
Acquisitions III L.L.C. All capitalized terms used herein and not otherwise
defined herein shall have the meanings ascribed to such terms in the
Partnership Agreement.
Each General Partner hereby acknowledges and agrees that any
election or decision to be made by the Partnership with respect to the Bridge
Loan Commitment Letter, including, without limitation, the election by the
Partnership to borrow the Bridge Loan thereunder, shall require the approval
of both the Blackstone GP and WHGP, each of which approvals may be withheld
in their sole discretion. BGP and Berkshire acknowledge that in the event
the Blackstone GP and WHGP elect not to authorize a borrowing under the
Bridge Loan Commitment Letter, the Partnership may be unable to satisfy its
obligations under the Merger Agreements and as a result, the Cash Collateral
(as defined in the Merger Agreement)(or its substitute) may be forfeited
thereunder. Failure of the Blackstone GP or WHGP to approve the
Partnership's borrowing of the Bridge Loan, whether or not such failure leads
to a loss of the Cash Collateral or other assets of the Partnership, shall
not (i) constitute a default by such Partner under the Partnership Agreement,
including under Section 12.21 of the Partnership Agreement, (ii) otherwise
constitute a breach of any obligations, express or implied, at law or in
equity, which otherwise may be owed by the Blackstone GP or WHGP to the
Partnership or (iii) excuse Berkshire or BGP from any of its obligations
under Section 12.21 of the Partnership Agreement.
The Partners acknowledge that, on the date hereof, the Partnership
will deliver a letter of credit issued by The Chase Manhattan Bank ("Chase")
in the amount of $29,500,000 (the "LC") to American Stock Transfer Trust
Company, as escrowee, pursuant to the terms of the Merger Agreement. In
connection with the issuance of the LC, each of the Investor Group Partners
have entered into reimbursement obligations with Chase with respect to the LC
as follows: (i) the members of the Blackstone Group have jointly agreed to
reimburse Chase for up to 40% of amounts due with respect to the LC; (ii) the
members of the Whitehall Group have jointly agreed to reimburse Chase for up
to 40% of amounts due with respect to the LC; and (iii) the members of the
Berkshire Group have jointly agreed to reimburse Chase for up to 20% of
amounts due with respect to the LC. The foregoing obligations of the members
of the Blackstone Group shall be several from the foregoing obligations of
the members of the Whitehall Group and the Berkshire Group; the foregoing
obligations of the members of the Whitehall Group shall be several from the
foregoing obligations of the members of the Blackstone Group and the
Berkshire Group; and the foregoing obligations of the members of the
Berkshire Group shall be several from the foregoing obligations of the
members of the Whitehall Group and the Blackstone Group. The Partners
further acknowledge and agree that for the purposes of Section 12.21 of the
Partnership Agreement, the amount any Partner shall be responsible for in
connection with its reimbursement obligations with respect to the LC shall be
deemed to be such Partner's Capital Contributions made to the Partnership
which will be reimbursed by a defaulting Partner in accordance with the
provisions of Section 12.21.
The Partners acknowledge and agree that as promptly as practicable
after the full execution and delivery of the BRI Merger Agreement and BRI OP
Merger Agreement (and in any event within seven (7) days after the date
hereof), the General Partners shall cause the Partnership to purchase an
interest rate hedge agreement having the following characteristics (such
agreement, the "Hedge"): (i) the Hedge will be a European style put option
with a strike rate equal to 50 basis points (0.50%) above the yield on the
five year U.S. Treasury security on the date of purchase; (ii) the expiration
date of the Hedge will be August 4, 1999 (or as soon thereafter as is
available); and (iii) the notional amount of the Hedge will be approximately
$593,000,000. Any two General Partners shall have the authority to execute
on behalf of the Partnership any and all documentation required to implement
the Hedge and all of the Partners agree to take any steps reasonably required
to implement the Hedge. Each of the Investor Group Partners shall fund its
pro rata share of the cost of the Hedge, based on its Partnership Percentage
Interest.
By its execution below, each of The Berkshire Companies Limited
Partnership and Xxxxxxx Xxxxx, jointly and severally, hereby guarantees to
the Partnership and the Partners the full payment and performance of all of
the obligations of BGP and Berkshire under Section 12.21 of the Agreement.
By its execution below, Blackstone Real Estate Acquisitions III
L.L.C. hereby guarantees to the Partnership and the Partners the full payment
and performance of all of the obligations of the Blackstone GP and the
Blackstone LP under Section 12.21 of the Agreement.
By its execution below, Whitehall Street Real Estate Limited
Partnership XI hereby guarantees to the Partnership and the Partners the full
payment and performance of all of the obligations of WHGP, Whitehall,
XxxxxXxxxxx, XxxxxxXxxxxx and StoneCorp under Section 12.21 of the Agreement.
The Partnership Agreement, as modified hereby, is and remains in
full force and effect and is hereby ratified and confirmed.
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The terms of this letter shall be binding upon, and inure to the
benefit of, each of the parties hereto and their respective successors and
assigns.
This letter shall be governed by and construed in accordance with
the laws of the State of Delaware.
IN WITNESS WHEREOF, the parties hereto have executed this letter as
of the date written above.
GENERAL PARTNERS:
WXI/BRH GEN-PAR LLC
By: /s/ XXXXXX XXXXXXX
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Name: Xxxxxx Xxxxxxx
Title: Vice President
BRE/BERKSHIRE GP L.L.C.
By: /s/ XXXXXXX X. XXXXXXX
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Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
APTCO GEN-PAR, L.L.C.
By: /s/ XXXXXXX XXXX
---------------------------
Name: Xxxxxxx Xxxxx
Title:
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LIMITED PARTNERS:
WHITEHALL STREET REAL ESTATE LIMITED PARTNERSHIP XI
By: WH Advisors, L.L.C. XI, its general partner
By: /s/ XXXXXX XXXXXXX
------------------------
Name: Xxxxxx Xxxxxxx
Title: Vice President
STONE STREET REAL ESTATE FUND 1998 L.P.
By: Stone Street Advantage Realty Corp., its
general partner
By: /s/ XXXX XXXX
------------------------
Name: Xxxx Xxxx
Title: Vice President
BRIDGE STREET REAL ESTATE FUND 1998 L.P.
By: Stone Street Advantage Realty Corp., its
general partner
By: /s/ XXXX XXXX
---------------------------
Name: Xxxx Xxxx
Title: Vice President
STONE STREET WXI/BRH CORP.
By: /s/ XXXX XXXX
--------------------------------
Name: Xxxx Xxxx
Title: Vice President
BRE/BERKSHIRE LP L.L.C.
By: /s/ XXXXXXX X. XXXXXXX
--------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
APTCO HOLDINGS, L.L.C.
By: /s/ XXXXXXX XXXXX
-----------------------------
Name: Xxxxxxx Xxxxx
Title: Authorized signatory
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GUARANTORS:
THE BERKSHIRE COMPANIES LIMITED PARTNERSHIP
By: /s/ XXXXXXX XXXXX
-------------------------
Name: Xxxxxxx Xxxxx
Title: Authorized Signatory
/s/ XXXXXXX XXXXX
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XXXXXXX XXXXX
BLACKSTONE REAL ESTATE ACQUISITIONS III L.L.C.
By: /s/ XXXXXXX X. XXXXXXX
---------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
WHITEHALL STREET REAL ESTATE LIMITED PARTNERSHIP XI
By: WH Advisors, L.L.C. XI, its general partner
By: /s/ XXXXXX XXXXXXX
---------------------------
Name: Xxxxxx Xxxxxxx
Title: Vice President
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