Exhibit 10.2


 


MASTER MANAGEMENT AGREEMENT


 


THIS MASTER MANAGEMENT AGREEMENT (this “Agreement”) is made and
entered into as of January 6, 2006, by and among Reit Management &
Research LLC, a Delaware limited liability company (“Managing Agent”),
and Hospitality Properties Trust, a Maryland real estate investment trust, on
behalf of itself and those of its subsidiaries as may from time to time own
properties subject to this Agreement (collectively, “Owners”).


 


W  I  T  N  E  S  S  E  T  H :


 


WHEREAS, Owners are the owners of various office and other
non-hotel properties (collectively, the “Managed Premises”); and


 


WHEREAS, Owners desire to retain Managing Agent, and Managing
Agent is willing to serve, as managing agent with respect to the Managed
Premises, all upon the terms and subject to the conditions hereinafter set
forth;


 


NOW, THEREFORE, in consideration of the premises and the agreements
herein contained, Owners and Managing Agent hereby agree as follows:


 


1.                                       Engagement. 
Subject to the terms and conditions hereinafter set forth, Owners hereby
employ Managing Agent with respect to the Managed Premises.  Managing Agent hereby accepts such employment
as managing agent and agrees to devote such time, attention and effort as may
be appropriate to operate and manage the Managed Premises in a diligent,
orderly and efficient manner.  Managing
Agent may, with Owners’ consent, subcontract out some or all of its obligations
hereunder to third party managers; provided, however, that, in
any such event, Managing Agent shall be and remain primarily liable to Owners
for performance hereunder.


 


Notwithstanding anything to the contrary set forth in
this Agreement, the services to be provided by Manager hereunder shall exclude
all services (including, without limitation, any garage management or cafeteria
management services) whose performance by an advisor to any Owner could give
rise to an Owner’s receipt of “impermissible tenant service income” as defined
in §856(d)(7) of the Internal Revenue Code (as amended or superseded
hereafter) or could in any other way jeopardize an


 





















 


Owner’s federal or state
tax classification as a real estate investment trust.  Manager shall not perform any such service
and if, in any event, Manager shall inadvertently perform any such service, no
compensation therefor shall be paid or payable hereunder.


 


2.                                       General Parameters. 
Any or all services may be performed or goods purchased by Managing
Agent under arrangements jointly with or for other properties owned or managed
by Managing Agent and the costs shall be reasonably apportioned.  Managing Agent may employ personnel who are
assigned to work exclusively at the Managed Premises or partly at the Managed
Premises and other buildings owned and/or managed by Managing Agent.  Wages, benefits and other related costs of
centralized accounting personnel and employees employed by Managing Agent and
assigned to work exclusively or partly at the Managed Premises shall be fairly
apportioned and reimbursed, pro rata, by Owners in addition to the Fee and
Construction Supervision Fee (as defined in Section 5).


 


3.                                       Duties. 
Without limitation, Managing Agent agrees to perform the following
specific duties:


 


(a)  To seek tenants for the
Managed Premises in accordance with the rental schedule established by the
applicable Owner and to negotiate leases including renewals thereof and to
lease in the applicable Owner’s name space on a lease form approved by such
Owner, only to tenants, at rentals, and for periods of occupancy all as are
approved in each case by the applicable Owner. 
To employ appropriate means in order that the availability of rental
space is made known to potential tenants; provided, however, that
such means shall not include the employment of brokers unless otherwise agreed
by the applicable Owner.  The legal
expenses of negotiating such leases and leasing such space shall be approved
and paid by the applicable Owner.


 


(b)  To collect all rents
and other income from the Managed Premises and to give receipts therefor, both
on behalf of Owners, and deposit such funds in such banks and such accounts as
are named, from time to time, by Owners, in agency accounts for and under the
name of Owners.  Managing Agent shall be
empowered to sign disbursement checks on these accounts.


 


(c)  To make contracts for
and to supervise any repairs and/or alterations to the Managed Premises,


 


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including
tenant improvements and decoration of rental space, as may be approved by the
applicable Owner.


 


(d)  For Owners’ account and
at its expense, to hire, supervise and discharge employees as required for the
efficient operation and maintenance of the Managed Premises.


 


(e)  To obtain, at Owners’
expense, appropriate insurance for the Managed Premises protecting Owners and
Managing Agent while acting on behalf of Owners against all normally insurable
risks relating to the Managed Premises and complying with the requirements of
Owners’ mortgagee, if any, and, upon approval thereof, to cause the same to be
provided and maintained by all tenants with respect to the Managed Premises to
the extent required by the terms of such tenants’ leases.


 


(f)  To promptly notify the
applicable Owner and its insurance carriers, as required by the applicable
policies, of any casualty or injury to person or property at the Managed
Premises, and complete customary reports in connection therewith.


 


(g)  To procure seasonably
all supplies and other materials necessary for the proper operation of the
Managed Premises, at Owners’ expense.


 


(h)  To pay promptly from
rental receipts, other income derived from the Managed Premises, or other
monies made available by Owners for such purpose, all costs incurred in the
operation of the Managed Premises which are expenses of Owners hereunder,
including wages or other payments for services rendered, invoices for supplies
or other items furnished in relation to the Managed Premises, and pay over
forthwith the balance of such rental receipts, income and monies to Owners or
as Owners shall from time to time direct. 
(In the event that the sum of the expenses to operate and the
compensation due the Managing Agent exceed gross receipts in any month and no
excess funds from prior months are available for payment of such excess, Owners
shall pay promptly the amount of the deficiency thereof to Managing Agent upon
receipt of statements therefor.)


 


(i)  To advise Owners
promptly of any material developments in the operation of the Managed Premises
that might affect the profitable operation of the Managed Premises.


 


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(j)  To establish, in Owners’ name and with Owners’
approval, reasonable rules and regulations for tenants of the Managed
Premises.


 


(k)  At the direction of the applicable Owner and
with counsel selected by such Owner, to institute or defend, as the case may
be, any and all legal actions or proceedings (in the name of such Owner if
necessary) relating to operation of the Managed Premises.


 


(l)  To maintain the books and records of Owners
reflecting the management and operation of the Managed Premises, making
available for reasonable inspection and examination by Owners or its
representatives, all books, records and other financial data relating to the
Managed Premises.


 


(m)  To prepare and deliver seasonably to tenants
of the Managed Premises such statements of expenses or other information as
shall be required on the landlord’s part to be delivered to such tenants for
computation of rent, additional rent, or any other reason.


 


(n)  To aid, assist and cooperate with Owners in
matters relating to taxes and assessments and insurance loss adjustments,
notify the Owners of any tax increase or special assessments relating to the
Managed Premises and, with Owners’ approval, to enter into contracts for tax
abatements services.


 


(o)  To provide such emergency services as may be
required for the efficient management and operation of the Managed Premises on
a 24-hour basis.


 


(p)  To enter into contracts for utilities
(including, without limitation, water, fuel, electricity and telephone) and for
building services (including, without limitation, cleaning of windows, common
areas and tenant space, ash, rubbish and garbage hauling, snow plowing,
landscaping, carpet cleaning and vermin extermination), and for other services
as are appropriate to first class office space.


 


(q)  To seek the lowest competitive price
commensurate with desired quality for all items purchased or services
contracted by it under this Agreement.


 


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(r)  To take such action generally consistent with
the provisions of this Agreement, as Owners might with respect to the Managed
Premises if personally present.


 


4.                                       Authority. 
Owners give to Managing Agent the authority and powers to perform the
foregoing duties on behalf of Owners subject, however, to Owners’ approval as
specified.  Owners further authorize
Managing Agent to incur such reasonable expenses, specifically contemplated in Section 2,
on behalf of Owners as are necessary in the performance of those duties.


 


5.                                       Special Authority of Agent. 
In addition to, and not in limitation of, the duties and authority of
Managing Agent contained herein, Managing Agent shall perform the following
duties, but only with Owners’ prior approval in each case:


 


(a)  Terminate tenancies and
sign and serve in the name of Owners such notices therefor as may be required
for the proper management of the Managed Premises.


 


(b)  With counsel selected
by Owners, and at Owners’ expense, institute and prosecute actions to evict
tenants and recover possession of rental space, and recover rents and other
sums due; and when expedient, settle, compromise and release such actions or
suits or reinstate such tenancies.


 


6.                                       Compensation.


 


(a)  In consideration of the
services to be rendered by the Managing Agent hereunder, Owners agree to pay
and the Managing Agent agrees to accept as its sole compensation (i) a
management fee (the “Fee”) equal to three percent (3%) of the gross
collected rents actually received by Owners from the Managed Premises, such gross
rents to include all fixed rents, percentage rents, additional rents, operating
expense and tax escalations, and any other charges paid to Owners in connection
with occupancy of the Managed Premises, but excluding any amounts collected
from tenants to reimburse Owners for the cost of capital improvements or for
expenses incurred in curing any tenant default or in enforcing any remedy
against any tenant; and (ii) a construction supervision fee (the “Construction
Fee”) in connection with all interior and exterior construction renovation
or repair activities at the Managed Premises, including, without limitation,
all tenant and capital improvements in, on or about the Managed Premises,
undertaken during the term of this Agreement,


 


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other
than ordinary maintenance and repair, equal to five percent (5%) of the cost of
such construction which shall include the costs of all related professional
services and the cost of general conditions.


 


(b)  The Fee shall be due
and payable monthly, in arrears based on a reasonable annual estimate or budget
with an annual reconciliation within thirty (30) days after the end of each
calendar year.  The Construction Fee
shall be due and payable periodically, as agreed by Managing Agent and Owners,
based on actual costs incurred to date.


 


(c)  Notwithstanding
anything herein to the contrary, Owners shall reimburse Managing Agent for
reasonable travel expenses incurred when traveling to and from the Managed
Premises while performing its duties in accordance with this Agreement; provided,
however, that, reasonable travel expenses shall not include expenses
incurred for travel to and from the Managed Premises by personnel assigned to
work exclusively at the Premises.


 


(d)  Managing Agent shall
also receive the amount of any lump sum reimbursables paid by tenants of the
Managed Premises to the extent amounts paid exceed costs incurred by Owners for
work performed with respect thereto.


 


(e)  Managing Agent shall be
entitled to no other additional compensation, whether in the form of
commission, bonus or the like for its services under this Agreement.  Except as otherwise specifically provided
herein with respect to payment by Owners of legal fees, accounting fees,
salaries, wages, fees and charges of parties hired by the Managing Agent on
behalf of Owners to perform operating and maintenance functions in the Managed
Premises, and the like, if Managing Agent hires third parties to perform
services required to be performed hereunder by Managing Agent without
additional charge to Owners, Managing Agent shall (except to the extent the
same are reasonably attributable to an emergency at the Managed Premises) be
responsible for the charges of such third parties.  Managing Agent shall not, however, hire any
third party without Owners’ prior written consent, which consent shall not be
unreasonably withheld.


 


7.                                       Contracts. 
Managing Agent shall not, without the prior consent of Owners, enter
into any contracts on behalf of Owners which extend beyond the then current
term of this Agreement.


 


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8.                                       Term of Agreement. 
The term of this Agreement shall begin on the date hereof and, unless
sooner terminated as herein provided, shall end on that date which is thirty
(30) days following written notice of termination given by either Owners or
Managing Agent to the other.  This
Agreement may be terminated with respect to less than all of the properties
comprising the Managed Premises.


 


9.                                       Termination or Expiration. 
Upon termination or expiration of this Agreement with respect to any of
the Managed Premises for any reason whatsoever, Managing Agent shall promptly
turn over to Owners all books, papers, funds, records, keys and other items
relating to the management and operation of such Managed Premises, including,
without limitation, all leases in the possession of the Managing Agent and
shall render to Owners a final accounting with respect thereto through the date
of termination.


 


10.                                 Assignment
of Rights and Obligations.


 


(a)  Without Owners’ prior
written consent, Managing Agent shall not sell, transfer, assign or otherwise
dispose of or mortgage, hypothecate or otherwise encumber or permit or suffer
any encumbrance of all or any part of its rights and obligations hereunder, and
any transfer, encumbrance or other disposition of an interest herein made or
attempted in violation of this paragraph shall be void and ineffective, and
shall not be binding upon Owners.


 


(b)  Owners, without
Managing Agent’s consent, may assign its rights and obligations hereunder to
any mortgagee with respect to, or successor Owners of, the Managed Premises,
but not otherwise.


 


(c)  Consistent with the
foregoing paragraphs (a) and (b), the terms “Owners” and “Managing Agent”
as used in this Agreement shall mean the original parties hereto and their
respective mortgagees, successors, assigns, heirs and legal representatives.


 


11.                                 Fidelity Bond. 
Owners, at Owners’ expense, may require that employees of Managing Agent
who handle or are responsible for Owners’ money to be bonded by a fidelity bond
in an amount sufficient in Owners’ determination to cover any loss which may
occur in the management and operation of the Managed Premises or that Managing
Agent obtain a fiduciary policy of insurance.


 


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12.                                 Indemnification
and Insurance.


 


(a)  Owners agree to defend,
indemnify and hold harmless Managing Agent from and against all costs, claims,
expenses and liabilities (including reasonable attorneys’ fees) arising out of
Managing Agent’s performance of its duties in accordance with this Agreement
including, without limitation, injury or damage to persons or property
occurring in, on or about the Managed Premises and violations or alleged
violations of any law, ordinance, regulation or order of any governmental
authority regarding the Managed Premises except any injury, damage or violation
resulting from Managing Agent’s default hereunder, or from Managing Agent’s
fraud, gross negligence or willful misconduct in the performance of its duties
hereunder.


 


(b)  Owners agree that
required insurance shall include, at Owners’ expense, public liability and
workmen’s compensation insurance upon the following terms and conditions:


 


(i)  policies shall be so
written as to protect the Managing Agent in the manner and to the same extent
as Owners.


 


(ii)  Workmen’s compensation
policies shall be written to comply with applicable legal requirements.


 


(iii)  The public liability
insurance shall be written in limits of not less than One Million Dollars
($1,000,000) per occurrence for bodily injury and Five Hundred Thousand Dollars
($500,000) per occurrence for property damage.


 


(iv)  Such public liability
insurance shall include the standard extensions of liability coverage as may be
mutually agreed upon from time to time, and shall name both parties and their
respective employees as additional insureds.


 


13.                                 Notices. 
Whenever notice is to be sent pursuant to this Agreement to either party
to this Agreement, it is expressly understood that same shall be sent postage
prepaid, certified mail, return receipt requested to either party at 400 Centre
Street, Newton, Massachusetts 02458, or to any such address that either party
may hereinafter designate.


 


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14.                                 Limitation
of Liability.


 


(a)  Neither Owners nor Managing Agent shall be
personally liable hereunder, all such liability being limited in the case of
Owners to the interest of Owners in the Managed Premises and in the case of
Managing Agent, to its interest hereunder.


 


(b)  The Declarations of Trust establishing some
Owners, a copy of which, together with all amendments thereto (the “Declarations”),
is duly filed with the Department of Assessments and Taxation of the State of
Maryland, provides that the names of such Owners refers to the trustees under
such Declarations collectively as trustees, but not individually or personally,
and that no trustee, officer, shareholder, employee or agent of such Owners
shall be held to any personal liability, jointly or severally, for any
obligation of, or claim against, such Owners. 
All persons dealing with such Owners, in any way, shall look only to the
respective assets of such Owners for the payment of any sum or the performance
of any obligation of such Owners.  In any
event, all liability of such Owners hereunder is limited to the interest of
such Owners in the Managed Premises and, in the case of Managing Agent, to its
interest hereunder.


 


(c)  It is the intention of the parties hereto
that each Owner be liable hereunder only with respect to the Managed Premises
owned by such Owner and that each Owner be solely responsible for liabilities
incurred with respect only to its properties and receive all income therefrom.


 


15.                                 Modification of Agreement. 
This Agreement may not be modified, altered or amended in manner except
by an amendment in writing, duly executed by the parties hereto.


 


16.                                 Independent Contractor. 
This Agreement is not one of general agency by Managing Agent for
Owners, but one with Managing Agent engaged as an independent contractor.  Nothing in this Agreement is intended to
create a joint venture, partnership, tenancy-in-common or other similar
relationship between Owners and Managing Agent for any purposes whatsoever.


 


17.                                 Law Governing. 
This Agreement shall be governed by and in accordance with the laws of
The Commonwealth of Massachusetts.


 


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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as a
sealed instrument as of the date above first written.


 


	
   

  	
  REIT
  MANAGEMENT & RESEARCH LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John C.
  Popeo

  	
   

  
	
   

  	
   

  	
  Its (Vice)
  President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HOSPITALITY
  PROPERTIES TRUST, on its 

  own behalf and on behalf of its 

  subsidiaries:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John G. Murray

  	
   

  
	
   

  	
   

  	
  Its President

  
						



 


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