EXHIBIT 10.57



 Exhibit 10.57 
 Execution Copy 
 LETTER AGREEMENT 
 Date: November 2, 2007 
 Beneficiary: Prime Cash Reserves Portfolio, a series of Master Portfolio Trust 
 Letter of
Credit No. 61670750 
 We refer to (i) Letter of Credit no. 61670750 issued by Citibank, N.A. (“Issuer”) in favor
of you dated as of November 2, 2007 (the “Letter of Credit”) for the account of The Baltimore Company, a Maryland corporation and Legg Mason, Inc., a Maryland corporation (collectively, “we” or the
“Applicants”) and related to the Securities (as defined below) and (ii) the related Agreement for Standby Letters of Credit dated as of the date hereof among us and Issuer (the “Reimbursement Agreement”). Terms
defined in the Letter of Credit and not otherwise defined herein are used herein as therein defined. 
 In consideration of the issuance of
the Letter of Credit and our obligations in respect thereof under the Reimbursement Agreement and the other Loan Documents (as defined in the Reimbursement Agreement), you hereby covenant and agree as follows: 
  

	 	(1)	You shall immediately terminate the Letter of Credit in accordance with the terms thereof upon the occurrence of any of the following events prior to October 31, 2008:


  

	 	(a)	You have sold or otherwise disposed of all commercial paper and other securities issued by Cheyne Funding LLC in which you have invested (the “Securities”) and
either have not realized any loss therefrom or have made draws under the Letter of Credit as a result of such sale or disposition in an aggregate amount equal to all such losses; 

  

	 	(b)	All Securities have been restructured, modified, refinanced, exchanged into or replaced by new debt rated at least “P-1” (or the then equivalent grade) by Moody’s (as
defined below) or “A-1” (or the then equivalent grade) by S&P (as defined below) that is eligible to be held by a money market fund under Rule 2a-7 of the Investment Company Act of 1940 (each such transaction, a
“Transaction”), of which the aggregate principal amount, plus the amount of any cash consideration received by you in respect thereof and any amounts drawn under the Letter of Credit as a result of such transaction, is no less than
the amortized cost of the Securities that were so restructured, modified, refinanced, exchanged or replaced on the date used in such Transaction to determine the amount of securities to be received in such Transaction; 

  

	 	(c)	You have been repaid in full in respect of all Securities; 








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	 	(d)	Upon our request if (i) we have obtained guarantees, insurance, contractual rights or any other supporting obligations relating to the Securities to replace the Letter of
Credit, which replacement would not cause a downgrade of your ratings or you to be placed on credit watch (a “Ratings Event”) by Moody’s Investors Service Inc. (“Moody’s”) or Standard &
Poor’s, a division of The McGraw-Hill Companies, Inc. (“S&P”) or (ii) we have received written confirmation from Moody’s and S&P that a termination of the Letter of Credit would not result in a Ratings Event;
or 

  

	 	(e)	The Securities are rated “P-1” (or the then equivalent grade) or higher by Moody’s or “A-1” (or the then equivalent grade) or higher by S&P.


  

	 	(2)	If at any time a portion of the Securities is repaid in cash in accordance with the maturity of the Security or a scheduled payment of principal thereunder, you agree that the
maximum aggregate amount that may be drawn under the Letter of Credit from that time until the Termination Date will not exceed the Percentage at such time of the Maximum Amount. “Percentage” at any time means the percentage
obtained by dividing (x) the amount of the Securities held by you on the date of issuance of the Letter of Credit less the amount of Securities that have been repaid in cash as described above through such time by (y) the amount of the
Securities held by you on the date of the issuance of the Letter of Credit. 

  

	 	(3)	On or after the Termination Date, in the event that all of the Securities shall have been (a) sold or otherwise disposed of for cash, and/or shall have been repaid with or
otherwise converted into cash or (b) restructured, modified, refinanced, exchanged into or replaced by new debt, and the sum of (i) the aggregate amount of all such cash proceeds and (ii) the aggregate principal amount of such new
debt shall exceed the difference between (X) the amortized cost of the Securities so sold, disposed of, repaid, converted, restructured, modified, refinanced, exchanged or replaced less (Y) all amounts drawn under the Letter of Credit,
thereupon you shall pay to us cash in the amount of such excess (i.e., the sum of clauses (i) and (ii) over the difference in clauses (X) and (Y) above); provided that such payment shall not exceed the aggregate amount drawn on
the Letter of Credit. Notwithstanding the foregoing, in the event that the amount drawn on the Letter of Credit pursuant to Section 2(c) of Exhibit A thereto equals or exceeds the amortized cost of all Securities then outstanding and held by
you, then the previous sentence of this Section 3 shall not apply and, on the date of such drawing on the Letter of Credit, you agree to transfer to us all such Securities in consideration of such drawing under the Letter of Credit in
accordance with Rule 17a-9 under the Investment Company Act of 1940 (i.e., you must receive, including amounts drawn under the Letter of Credit, the greater of the amortized cost or the fair market value of such Securities).


  

	 	(4)	 You agree that you will not make any drawing under the Letter of Credit unless before and after giving effect to such drawing, all the representations and
warranties contained in Exhibit A to the Letter of Credit are true and correct. You further agree that, prior to your taking any action that would result in the occurrence and continuance of any of the events described in clause 2(a) or (b) of
Exhibit A to the Letter of Credit, you will provide us no less than 1 business day’s notice of your intention to take such action and will sell to us, if we elect to 










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	 	purchase, all Securities that are the subject of the intended action at a price equal to the greater of (i) the amortized cost of such Securities and (ii) the market value
of such Securities. You will also sell to us at any time within the 5 business days before October 31, 2008, if we elect to purchase, all Securities that are outstanding and held by you at a price equal to the greater of (i) the amortized
cost of such Securities and (ii) the market value of such Securities. 

  

	 	(5)	Subject to the satisfaction of the conditions to drawing in the Letter of Credit and subject to the terms of this Letter Agreement, it is understood and agreed that you will
exercise your rights under the Letter of Credit when you are entitled to do so. 

 This letter may not be amended or any
provision hereof waived or modified except by an instrument in writing signed by each of the parties hereto. THIS LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. This letter may be executed in any
number of counterparts, each of which shall be an original and all of which, when taken together, shall constitute one agreement. Delivery of an executed counterpart of a signature page of this letter by facsimile transmission shall be effective as
delivery of a manually executed counterpart of this letter. Section headings used herein are for convenience of reference only, are not part of this letter and are not to affect the construction of, or to be taken into consideration in interpreting,
this letter. 
  

			
	Very truly yours,
	
	 THE BALTIMORE COMPANY

		
	By	 	 /s/ Charles J. Daley, Jr.

		 	 Name: Charles J. Daley, Jr.
 Title: President



  
  

			
	 LEGG MASON, INC.

		
	By	 	 /s/ Raymond A. Mason

		 	 Name: Raymond A. Mason
 Title: Chief Executive Officer



 ACKNOWLEDGED AND AGREED 
  

			
	 PRIME CASH RESERVES PORTFOLIO,
 a series of MASTER PORTFOLIO TRUST

		
	By	 	 /s/ R. Jay Gerken

		 	 Name: R. Jay Gerken
 Title: Chairman, President and
     Chief Executive Officer