May __, 1998
Philips International Realty Corp.
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
Reference is made to that certain Contribution and Exchange Agreement,
dated as of December 31, 1997, as amended (the "Contribution and Exchange
Agreement"), by and among Philips International Realty Corp. (the "REIT"),
Philips International Realty, L.P. (the "Operating Partnership" and, together
with the REIT, the "Company"), the Property Partnerships and certain other
parties named therein. Capitalized terms used but not defined herein shall have
the meanings assigned to them in the Contribution and Exchange Agreement.
In connection with the proposed public offering (the
"Offering") of the Common Stock of the Company contemplated by Registration
Statement No. 333-47975 on Form S-11 filed with the Securities and Exchange
Commission on March 13, 1998, as amended, the undersigned, as sponsors of the
Offering, hereby agree (for the benefit of the Company only) that the
representations and warranties of the Property Partnerships and the Partners
under Section 5 of the Contribution and Exchange Agreement, made as of August 8,
1997 and reaffirmed on December 31, 1997, will survive until the first
anniversary of the consummation of the Offering (notwithstanding anything to the
contrary contained in Section 5.4 of the Contribution and Exchange Agreement;
provided, however, that Section 5.4(b) thereunder shall not be affected by the
foregoing), and agree to jointly and severally indemnify and hold harmless the
Company from and against any losses, claims, damages, liabilities and expenses
incurred by the Company in connection with any breach of any representation or
warranty with respect to claims made on or before the first anniversary of the
consummation of the Offering.
Notwithstanding anything to the contrary contained in the Contribution
and Exchange Agreement or herein, the Company's sole recourse and remedy, in the
event of any breach of any representation or warranty by such Property
Partnerships or Partners, shall be limited to claims against those Units held by
the undersigned represented by certificate nos. 2 and 5 (622,643 and 601,778
Units, respectively; each as adjusted to reflect the 1.7051 to 1 split of the
Company's Common Stock), which shall bear a legend reflecting that the Units are
subject to such claims. The undersigned hereby agree that the Units represented
by the foregoing certificates shall not be
redeemed for Common Stock, or sold, transferred, encumbered or otherwise pledged
during the term of this Agreement, except to Affiliates (as defined in the
Amended and Restated Agreement of Limited Partnership of the Operating
Partnership) who expressly agree to take such Units subject to the Company's
rights hereunder.
Please confirm that the foregoing correctly sets forth our agreement by
signing below. This letter shall constitute a binding agreement as of December
31, 1997, and shall expire by its terms on the first anniversary of the
consummation of the Offering (except that all claims made hereunder on or before
such date shall survive the expiration of this agreement), but shall only be
effective upon the consummation of the Offering.
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Xxxxxx Xxxxxxxx
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Xxxxxx Xxxxxx
Agreed and Accepted:
Philips International Realty Corp.
By:
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Name: Xxxxx X. Xxxxx
Title: President
