Exhibit 99.1
GUARANTY
GUARANTY made as of June 7,
2005, by each of ING Bank N.V. (“ Sponsor Principal
”), and Lehman Brothers Holdings Inc. (“ Lehman
Principal ”), in favor of Gables Residential Trust, a
Maryland real estate investment trust (the “ Company
”), and Gables Realty Limited Partnership, a Delaware limited
partnership (the “ Partnership ”). Each of
Sponsor Principal and Lehman Principal shall be referred to herein
individually as a “Guarantor,” and, together, as the
“Guarantors.”
For value received, and to induce
the Company and the Partnership to enter into the Merger Agreement,
dated as of June 7, 2005, together with any subsequent
amendment or amendments thereto (the “ Merger
Agreement ”), by and among the Company, the Partnership,
Bulldog Parent Limited Partnership, a Delaware limited partnership
(“ Parent ”), Bulldog Properties Trust, a
Maryland real estate investment trust (“ MergerCo
”), and Bulldog Properties, L.P., a Delaware limited
partnership (“ Merger Partnership ”, and
collectively with Parent and MergerCo, the “ Acquiror
”), each of the Guarantors, severally and not jointly, hereby
unconditionally guarantees the prompt and complete payment when due
of the payment obligations and the timely performance when required
of all other obligations of Acquiror (if any), or any of its
successors or assigns, that arise under the Merger Agreement to the
Company and the Partnership or either of them (collectively, the
“ Obligations ”), as follows: (i) with
respect to Sponsor Principal, 50% of any of the Obligations (the
“ Sponsor Pro Rata Share ”) in an amount, in the
aggregate, not to exceed $400,000,000 (the “ Sponsor
Principal Cap ”); and (ii) with respect to Lehman
Principal, 50% of any of the Obligations (the “ Lehman Pro
Rata Share ”) in an amount, in the aggregate, not to
exceed $400,000,000 (the “ Lehman Principal Cap
” and, together with the Sponsor Principal Cap, the “
Principal Caps ”). In the event that Sponsor
Principal elects by written notice delivered to Lehman Principal,
the Company and the Partnership to assume the obligations of Lehman
Principal hereunder by increasing the Sponsor Pro Rata Share to
100% and the Sponsor Principal Cap to $800,000,000, the Lehman Pro
Rata Share and the Lehman Principal Cap shall each be reduced to
zero and Lehman Principal shall be released from all obligations
hereunder. In the event that Lehman Principal elects by
written notice delivered to Sponsor Principal, the Company, and the
Partnership to assume the obligations of Sponsor Principal
hereunder by increasing the Lehman Pro Rata Share to 100% and the
Lehman Principal Cap to $800,000,000, the Sponsor Pro Rata Share
and the Sponsor Principal Cap shall each be reduced to zero and the
Sponsor Principal shall be released from all obligations
hereunder. Only the party that first gives a notice of
election shall be entitled to assume the Obligations
hereunder.
This Guaranty is an absolute,
unconditional and continuing guarantee of the full and punctual
payment and performance of the Obligations, with respect to the
Sponsor Principal, to the extent of the Sponsor Pro Rata Share and
up to the Sponsor Principal Cap, and with respect to the Lehman
Principal, to the extent of the Lehman Pro Rata Share and up to the
Lehman Principal Cap, and not of their collectibility only, and is
in no way conditioned upon any requirement that the Company or the
Partnership first attempt to collect the Obligations from Acquiror
or resort to any security or other means of collecting
payment. Should Acquiror default in the payment or
performance of the Obligations, the Guarantors’ respective
several obligations hereunder, with respect to the Sponsor
Principal, to the extent of the Sponsor Pro Rata Share and up to
the Sponsor Principal Cap, and with respect to the Lehman
Principal, to the extent of the
