Exhibit
10.21


 


AMENDED AND RESTATED


SHAREHOLDERS AGREEMENT


 


AFFILIATES INSURANCE COMPANY


 


This
Amended and Restated Shareholders Agreement (this “Agreement”), dated December 16,
2009, by and among Affiliates Insurance Company, an Indiana insurance company (the
“Company”), Five Star Quality Care, Inc., a Maryland corporation (“FVE”),
Hospitality Properties Trust, a Maryland real estate investment trust (“HPT”),
HRPT Properties Trust, a Maryland real estate investment trust (“HRP”),
Senior Housing Properties Trust, a Maryland real estate investment trust (“SNH”),
TravelCenters of America LLC, a Delaware limited liability company (“TA”),
Reit Management & Research LLC, a Delaware limited liability company (“RMR”,
and together with FVE, HPT, HRP, SNH and TA, the “Original Shareholders”),
and Government Properties Income Trust, a Maryland real estate investment trust
(“GOV”, and together with the Original Shareholders, the “Shareholders”),
amends and restates the Shareholders Agreement (the “Original Shareholders Agreement”),
dated February 27, 2009 (the “Original Date”), by and among the
Company and the Original Shareholders, effective as of the date first set forth
above.


 


RECITALS


 


WHEREAS,
the Company has been formed and licensed as an insurance company domiciled in
the State of Indiana;


 


WHEREAS,
the Original Shareholders previously made the capital contributions to the
Company contemplated by Section 1.1 of this Agreement;


 


WHEREAS,
in connection with the purchase by GOV from the Company of 20,000 shares of common
stock, par value of $10.00 per share, of the Company (the “Shares”)
pursuant to a Subscription Agreement (the “GOV Subscription Agreement”)
to be entered into by the Company and GOV, concurrently with the execution and
delivery of this Agreement, the Company, the Original Shareholders and GOV
desire to enter into this Agreement to, among other things, add GOV as a
Shareholder hereunder; and


 


WHEREAS,
the Shareholders and the Company desire to enter into this Agreement in order
to set forth certain agreements and understandings relating to the business and
governance of the Company, the Shares held by the Shareholders and certain
other matters.


 

















 


NOW,
THEREFORE, in consideration of the representations, warranties, covenants and
agreements contained in this Agreement and of other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto, intending to be legally bound, hereby agree as follows:


 


ARTICLE
I


 


INVESTMENT
IN THE COMPANY; FORMATION AND LICENSING EXPENSES


 


1.1                                 Share Issuances to Original Shareholders.


 


(a)                                  On or about the Original Date, the
Company issued and sold to each Original Shareholder, and each Original
Shareholder purchased from the Company, 100 Shares at a purchase price of
$250.00 per Share.


 


(b)                                 Within five business days after the
Company notified the Original Shareholders that the Department of Insurance of
the State of Indiana had notified the Company that it intended to commence its
financial review of the Company, the Company issued and sold to each Original
Shareholder, and each Original Shareholder purchased from the Company, an
additional 19,900 Shares at a purchase price of $250.00 per Share.


 


1.2                                 Future Share Issuances.  No Shareholder shall be obligated
to purchase additional Shares or any other securities of the Company and any
future proposed issuance and sale of Shares or any other securities of the
Company shall be subject to Section 3.2, except to the extent otherwise
provided under this Agreement; provided, however, that the parties hereto
acknowledge that the Company may need to seek additional capital in the future
and that it is the intention of the Shareholders that they each may, but shall
not be obligated to, contribute to the Company up to an additional $5 million
of capital during the period between the second and fifth anniversaries of the
Original Date.


 


1.3                                 Formation and Licensing Expenses.  The Company shall pay for all
costs, fees and expenses in connection with the formation and licensing of the
Company as an Indiana insurance company.  The Original Shareholders shall
reimburse the Company for such amounts paid by the Company prior to the date
hereof in equal proportion.  The Shareholders shall reimburse the Company
for such amounts paid by the Company on or after the date hereof in equal
proportion.


 


1.4                                 Share Issuance to GOV.  As described in the recitals,
concurrently with the execution and delivery of this Agreement, GOV is
purchasing 20,000 Shares from the Company pursuant to the GOV Subscription
Agreement and, upon such purchase, GOV shall then become a Shareholder
effective as of such purchase.


 


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ARTICLE
II


 


BOARD
COMPOSITION


 


2.1                                 Board Composition.


 


(a)                                  For as long as the Shareholders
collectively own a majority of the issued and outstanding Shares, the board of
directors of the Company (the “Board”) shall consist of not less than
five nor more than fifteen members, with the actual number determined in
accordance with the Bylaws of the Company, as in effect from time to time, and
subject in all instances to this Section 2.1.  As of the date of this
Agreement, the Board shall initially consist of thirteen members.  For so
long as required by applicable Indiana law, at least one member of the Board
shall be an Indiana resident.  Except as otherwise provided in Section 2.1(c),
no Shareholder having a right to designate any director pursuant to this Article II
shall be required to designate an Indiana resident as a director pursuant to
such right; provided, however, that this sentence shall in no way limit the
application of the immediately preceding sentence.


 


(b)                                 For so long as a Shareholder (other than
RMR) owns not less than 10%  of the  issued and outstanding Shares, such
Shareholder shall have the right to designate two directors for election to the
Board.


 


(c)                                  For so long as RMR owns not less than 10%  of the  issued
and outstanding Shares, RMR shall have the right to designate three directors
for election to the Board.  For so long as RMR has the right to designate
directors pursuant to the immediately preceding sentence, Indiana law requires
the Board to include an Indiana resident as a director of the Company and no
other Shareholder designates an Indiana resident as a director of the Company,
RMR shall designate at least one Indiana resident to be a director.


 


(d)                                 Each Shareholder will vote, execute and
deliver written consents and take all other necessary action (including, if
necessary, causing the Company to call a special meeting of shareholders of the
Company) in favor of the election of each director designated by a Shareholder
in accordance with this Article II and otherwise to ensure that the
composition of the Board is at all times as set forth in this Article II. 
Each Shareholder agrees that it will not vote any of its Shares in favor of
removal of any director designated by another Shareholder unless such other
Shareholder shall have consented to such removal in writing.  Each
Shareholder agrees to cause to be called, if necessary, a special meeting of
shareholders of the Company and to vote all the Shares owned by such
Shareholder for, or to take all actions in lieu of any such meeting necessary
to cause, the removal of any director designated by such Shareholder if the
Shareholder entitled to designate such director requests in writing, signed by
such Shareholder, such director’s removal for any reason or no reason.


 


(e)                                  If, as a result of death, disability,
retirement, resignation, removal or otherwise, there shall exist or occur any
vacancy with respect to any director previously designated by a Shareholder in
accordance with such Shareholder’s right under this Article II to so
designate such director, such Shareholder shall have the right to designate a
replacement director.  Upon such designation, the Shareholders shall
promptly take all action necessary to ensure the election of such replacement
director to fill the unexpired term of the director whom


 


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such new director is
replacing, including, if necessary, calling a special meeting of shareholders
of the Company and voting their Shares, or executing any written consent in
lieu thereof, in favor of the election of such director.


 


ARTICLE
III


 


TRANSFER
OF SHARES; 

PREEMPTIVE RIGHTS; CALL RIGHTS


 


3.1                                 Transfer of Shares; No Pledging of Shares.


 


(a)                                  The Shareholders may not, directly or
indirectly, transfer any Shares, except that a Shareholder may transfer Shares
owned by it to a wholly owned subsidiary of such Shareholder, to another
Shareholder or to a wholly owned subsidiary of another Shareholder.  Any
purported transfer of Shares in contravention of this Section 3.1 shall be
null and void and of no force or effect.


 


(b)                                 The Shareholders may not pledge their
Shares (other than pledges arising from the operation of law and not as a
result of the Shareholder’s express granting of a pledge); provided, however,
that any pledge or other lien, charge or encumbrance which may arise by
application of the terms of any agreement, contract, license, permit or
instrument existing, for any of the Original Shareholders, on the Original
Date, and for GOV, on the date hereof (an “Existing Pledge”), on a
Shareholder’s Shares shall not be a violation of this Section 3.1(b); and
provided further, however, any transfer which results from exercise of rights
under a permitted lien, charge or encumbrance shall be subject to the call
rights of the Company and the other Shareholders set forth in Section 3.3
to the fullest extent permitted by applicable law and existing contracts as if
such a transfer constitutes a “Change of Control”.  Any Shareholder whose
Shares would be subject to an Existing Pledge shall use best efforts to cause
the pledgee under an Existing Pledge, prior to any exercise by the pledgee of
its rights on the Shareholder’s Shares, to take all actions under applicable
law which are required to be taken prior to any such exercise, including
obtaining any necessary approvals from the Indiana Department of Insurance and
Indiana Insurance Commissioner.


 


3.2                                 Preemptive Rights.


 


(a)                                  If, at any time after the date hereof,
the Company wishes to issue any capital stock of the Company or any other
securities convertible into or exchangeable or exercisable for capital stock of
the Company (collectively, “New Securities”) to any person or entity
(the “Subject Purchaser”), then the Company shall first offer the
Appropriate Percentage (as defined herein) of the New Securities (the “Allocated
Shares”) to each Shareholder (each, a “Preemptive Rightholder” and
collectively, the “Preemptive Rightholders”) by sending written notice
(the “New Issuance Notice”) to each of the Preemptive Rightholders,
which New Issuance Notice shall state the terms of such proposed issuance,
including the number of New Securities proposed to be issued and the proposed
purchase price per security of the New Securities (the “Proposed Price”). 
Upon delivery of the New Issuance Notice, such offer shall be irrevocable
unless and until the Company shall have terminated the contemplated issuance of
New Securities


 


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in its entirety at which
time the rights set forth herein shall be applicable to any proposed issuance
subsequent to any such termination.  For purposes of this Section 3.2,
“Appropriate Percentage” shall mean that percentage of the New
Securities determined by dividing (i) the total number of Shares then
owned by a Preemptive Rightholder by (ii) the total number of Shares owned
by all the Preemptive Rightholders.


 


(b)                                 For a period of 20 days after the giving
of the New Issuance Notice pursuant to Section 3.2(a) (the “Initial
Preemptive Subscription Period”), each of the Preemptive Rightholders shall
have the right to purchase, in whole or in part, the Allocated Shares offered
to such Preemptive Rightholder as determined pursuant to Section 3.2(a) at
a purchase price equal to the Proposed Price and upon the terms and conditions
set forth in the New Issuance Notice.


 


(c)                                  The right of each Preemptive Rightholder
to purchase the New Securities so offered under Section 3.2(b) shall
be exercisable by delivering written notice of the exercise thereof, prior to
the expiration of the Initial Preemptive Subscription Period, to the Company,
which notice shall state the amount of New Securities that such Preemptive
Rightholder elects to purchase pursuant to Section 3.2(a).  The
failure of a Preemptive Rightholder to respond prior to the expiration of the
Initial Preemptive Subscription Period shall be deemed to be a waiver of such
Preemptive Rightholder’s rights under this Agreement solely with respect to its
right to purchase the New Securities referenced in the New Issuance Notice;
provided that each Preemptive Rightholder may waive its rights under Section 3.2(b) prior
to the expiration of Initial Preemptive Subscription Period by giving written
notice of such waiver to the Company.


 


(d)                                 If as of the expiration of the Initial
Preemptive Subscription Period, some but not all of the Preemptive Rightholders
have exercised their right to purchase the full amount of New Securities to
which they are entitled to purchase pursuant to Sections 3.2(b) and (c) (any
such Preemptive Rightholder which has exercised in full its rights to purchase
such New Securities, a “Fully Exercising Preemptive Rightholder”), the
Fully Exercising Preemptive Rightholders shall have the right to purchase, in
whole or in part, their Oversubscription Appropriate Percentage (as defined
herein) of the New Securities which the Preemptive Rightholders did not
exercise their right to purchase pursuant to Sections 3.2(b) and (c) (the
“Undersubscribed Shares”) at a purchase price equal to the Proposed
Price and upon the terms and conditions set forth in the New Issuance
Notice.  The right of the Fully Exercising Preemptive Rightholders to
purchase the Undersubscribed Shares may be exercised for a period of ten days
following the earlier of the expiration of the Initial Preemptive Subscription
Period or the date on which notice is given by the Company to such Fully
Exercising Preemptive Rightholders that all the Preemptive Rightholders have
either exercised their right to purchase the New Securities pursuant to
Sections 3.2(b) and (c) or waived their rights to purchase any of
such New Securities pursuant to Section 3.2(c) (the “Oversubscription
Period”).  For purposes of this Section 3.2, “Oversubscription
Appropriate Percentage” shall mean that percentage of the Undersubscribed
Shares determined by dividing (i) the total number of Shares then owned by
a Fully Exercising Preemptive Rightholder by (ii) the total number of
Shares owned by all the Fully Exercising Preemptive Rightholders.


 


(e)                                  The right of each Fully Exercising
Preemptive Rightholder to purchase Undersubscribed Shares pursuant to Section 3.2(d) shall
be exercisable by delivering


 


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written notice of the
exercise thereof, prior to the expiration of the Oversubscription Period, to
the Company, which notice shall state the amount of Undersubscribed Shares that
such Fully Exercising Preemptive Rightholder elects to purchase pursuant to Section 3.2(d). 
The failure of a Fully Exercising Preemptive Rightholder to respond prior to
the expiration of the Oversubscription Period shall be deemed to be a waiver of
such Fully Exercising Preemptive Rightholder’s rights under this Agreement
solely with respect to its right to purchase the Undersubscribed Shares
included in the New Securities referenced in the New Issuance Notice; provided
that each Fully Exercising Preemptive Rightholder may waive its rights under Section 3.2(d) prior
to the expiration of Oversubscription Period by giving written notice of such
waiver to the Company.


 


(f)                                    The closing of the purchase of New
Securities subscribed for by the Preemptive Rightholders, including the Fully
Exercising Preemptive Rightholders, pursuant to this Section 3.2 shall be
held at such time and place as the parties to the transaction may reasonably
agree.  At such closing, the New Securities subscribed for shall be issued
by the Company free and clear of all liens, charges or encumbrances (other than
those arising hereunder and those attributable to actions by the purchasers
thereof).  Each Preemptive Rightholder, including each Fully Exercising
Preemptive Rightholder, purchasing the New Securities shall deliver at the
closing payment in full in immediately available funds for the New Securities
purchased by it.  At such closing, all of the parties to the transaction
shall execute such additional documents as are otherwise necessary, appropriate
or customary for similar financing transactions.  If any Preemptive
Rightholder, including any Fully Exercising Preemptive Rightholder, fails to
purchase any New Securities for which it exercised its right to purchase
pursuant to Sections 3.2(b) and (c) or 3.2(d) and (e), such New
Securities may be purchased by the Fully Exercising Preemptive Rightholders
which did purchase all the New Securities for which they exercised their rights
to purchase pursuant to Sections 3.2(b), (c), (d) and (e) in the same
manner provided in this Section 3.2 with respect to Undersubscribed Shares
and the resulting Oversubscription Period with respect to such right to
purchase shall be an “Oversubscription Period” for all instances such term is
used in this Section 3.2.  Notwithstanding the preceding sentence,
the obligations and liability of any Preemptive Rightholder, including any
Fully Exercising Preemptive Rightholder, which fails to purchase any New
Securities for which it exercised its right to purchase pursuant to Sections
3.2(b) and (c) or 3.2(d) and (e) shall not be relieved as a
result of any Fully Exercising Preemptive Rightholder’s right to purchase, or
any actual purchase by any Fully Exercising Preemptive Rightholder of, any such
New Securities.


 


(g)                                 Following the expiration of the later of
the Initial Preemptive Subscription Period and, if applicable, the
Oversubscription Period, if the Preemptive Rightholders, including any Fully
Exercising Preemptive Rightholders, did not exercise their right to purchase
any of the New Securities, including the Undersubscribed Shares, which were
originally the subject of the New Issuance Notice, then the Company may sell
the remaining New Securities to the Subject Purchaser on terms and conditions
that are no more favorable to the Subject Purchaser than those set forth in the
New Issuance Notice; provided, however, that such sale is bona fide and made
pursuant to a contract entered into between the Company and the Subject
Purchaser and that such sale is consummated by not later than 90 days following
the earlier to occur of (i) receipt by the Company of written waivers
pursuant to Section 3.2(c) from all the Preemptive Rightholders of
their rights to purchase the Appropriate Percentage of New


 


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Securities and, if
applicable, written waivers pursuant to Section 3.2(e) from all the
Fully Exercising Preemptive Rightholders of their rights to purchase the
Oversubscription Appropriate Percentage of New Securities, and (ii) the
expiration of the Oversubscription Period, if applicable, and if not
applicable, the expiration of the Initial Preemptive Subscription Period. 
If the sale of any of the New Securities is not consummated by the expiration
of such 90 day period, then the preemptive rights afforded to the Shareholders
under this Section 3.2 shall again become effective, and no issuance and
sale of New Securities may be made thereafter by the Company without again
offering the same in accordance with this Section 3.2.


 


3.3                                 Change of Control Call Option.


 


(a)                                  By not later than five days following a
Change of Control (as defined herein or in Section 3.1(b)) of any
Shareholder, such Shareholder shall give the Company and each other Shareholder
notice of such Change of Control and shall disclose the number of Shares and
any other securities of the Company which were owned by the Shareholder as of
immediately prior to such Change of Control of such Shareholder (the “Change
of Control Securities”).  If the Shareholder fails to give the notice
required by the preceding sentence by the time required thereby, and another
Shareholder or the Company is or becomes aware that such Shareholder underwent
a Change of Control, then (i) if it is a Shareholder that is or becomes
aware of such Change of Control, that Shareholder shall reasonably promptly
inform the Company of such Change of Control and upon the Company being of the
reasonable belief that such a Change of Control has occurred, the Company shall
reasonably promptly provide the notice to the Shareholders that such Shareholder
which underwent the Change of Control failed to provide, or (ii) if it is
the Company that is or becomes aware of such Change of Control, the Company
shall reasonably promptly provide the notice that such Shareholder which
underwent the Change of Control failed to provide.  Any liability of a
Shareholder which undergoes a Change of Control for failure to give the notice
required by the first sentence of this Section 3.3(a) shall not be
relieved as a result of the Company or any other Shareholder being obligated to
give, or giving, the notice required by the second sentence of this Section 3.3(a).


 


(b)                                 For a period of 20 days following the
receipt of a notice given pursuant to Section 3.3(a), the Company shall
have the right to purchase from such Shareholder (or its successor, as
applicable), in whole or in part, the Change of Control Securities.  The
purchase price for the Change of Control Securities shall be the book value, as
determined in accordance with the statutory accounting principles applicable to
the Company, of the Change of Control Securities as of the time such
Shareholder underwent the Change of Control (the “Call Option Purchase Price”). 
To exercise its right to purchase the Change of Control Securities, the Company
shall deliver written notice of such exercise to the Shareholder which
underwent the Change of Control and the other Shareholders prior to the
expiration of such 20 day call exercise period.  The closing for any such
exercised call option shall occur on the fifth business day (or such longer
period as may be required by applicable law or in order to obtain applicable
regulatory approval) following receipt of the Company’s notice of exercise of
its call option by the Shareholder which underwent the Change of Control, or on
such other date as may be agreed by the Company and such Shareholder.  At
its option, the Company may pay in cash the entire amount of the Call Option
Purchase Price at such closing or it may elect to defer any amount of the Call
Option Purchase Price.  Any amounts so deferred shall bear interest at the
Deferred


 


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Interest Rate (as defined
herein).  The Company may pay any such deferred amounts and accrued
interest thereon at any time and from time to time; provided, however, that all
such deferred amounts and accrued but unpaid interest, shall be due and payable
on the fifth anniversary of the closing of the applicable call option exercise.


 


(c)           Shareholders other than the
Shareholder which underwent the Change of Control shall have the right to
purchase, in whole or in part, any Change of Control Securities not elected to
be purchased by the Company pursuant to Section 3.3(b) at a price
equal to the Call Option Purchase Price.  To exercise its right to
purchase the Change of Control Securities, the applicable Shareholder shall
deliver written notice of such exercise to the Shareholder which underwent the
Change of Control, the Company and the other Shareholders by not later than the
20 days following the earlier of (i) the expiration of the 20 day period
during which the Company has the right to exercise its call option for the
Change of Control Securities pursuant to Section 3.3(b) and (ii) the
date the Company waives its right to purchase such Change of Control Securities
and has given notice of the same to all the Shareholders (such deadline for
exercising a right to purchase Change of Control Securities referred to as the “Call
Option Exercise Deadline”).  The notice of exercise shall indicate the
number of Change of Control Securities that the Shareholder seeks to
purchase.  If the aggregate number of Change of Control Securities sought
to be purchased by the exercising Shareholders (determined by adding all the
eligible securities each Shareholder states it seeks to purchase in its notice
of exercise) exceeds the actual number of Change of Control Securities eligible
for purchase, the number of Change of Control Securities which may be purchased
by a particular applicable Shareholder shall be reduced by an amount equal to
the product of the aggregate number of such excess Change of Control Securities
sought to be purchased by all the exercising Shareholders multiplied by
the quotient of (x) the number of Shares owned by all eligible
Shareholders which are exercising their call option rights minus the
number of Shares owned by the particular applicable exercising Shareholder divided
by (y) the number of Shares owned by all eligible Shareholders which
are exercising their call option rights, with any such result rounded up or
down to the nearest whole share as reasonably determined by the Company. 
The closing of any such exercised call option shall occur on the fifth business
day (or such longer period as may be required by applicable law or in order to
obtain applicable regulatory approval) following the Call Option Exercise
Deadline, or on such other date as may be agreed by the exercising Shareholder,
the Company and the Shareholder which underwent the Change of Control.  At
its option, the exercising Shareholder may pay in cash the entire amount of the
Call Option Purchase Price at such closing or it may elect to defer any amount
of the Call Option Purchase Price.  Any amounts so deferred shall bear
interest at the Deferred Interest Rate.  The exercising Shareholder may
pay any such deferred amounts and accrued interest thereon at any time and from
time to time; provided, however, that all such deferred amounts and accrued but
unpaid interest, shall be due and payable on the fifth anniversary of the
closing of the applicable call option exercise.


 


(d)           Definitions.  For
purposes of this Section 3.3, the following terms have the meanings set
forth below:


 


(i)    “Change of Control” means (A) the
acquisition by any person or entity, or two or more persons or entities acting
in concert, of beneficial ownership (such term, for purposes of this Section 3.3(d)(i),
having the meaning provided


 


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such term in Rule 13d-3
under the Securities Exchange Act of 1934, as amended) of 9.8% or more, or
rights, options or warrants to acquire 9.8% or more, or any combination
thereof, of the outstanding shares of voting stock or other voting interests of
the Shareholder, including voting proxies for such shares, or the power to
direct the management and policies of the Shareholder, directly or indirectly,
excluding with respect to RMR, any person or entity, or two or more persons or
entities acting in concert, beneficially owning 9.8% or more of RMR’s
outstanding voting interests as of the date of this Agreement, and excluding
with respect to FVE, persons or entities that have rights to acquire 9.8% or
more of FVE’s shares of common stock by virtue of their holding convertible
notes of FVE outstanding as of the date of this Agreement, (B) the merger
or consolidation of the Shareholder with or into any other person or entity
(other than the merger or consolidation of any person or entity into the
Shareholder that does not result in a Change in Control of the Shareholder
under clauses (A), (C), (D) or (E) of this definition), (C) any
one or more sales or conveyances to any person or entity of all or any material
portion of the assets (including capital stock or other equity interests) or
business of the Shareholder, (D) the cessation, for any reason, of the
individuals who at the beginning of any 38 consecutive month period constituted
the board of directors (or analogous governing body) of the Shareholder
(together with any new directors (or analogous position) whose election by such
board or whose nomination for election by the shareholders of the Shareholder
was approved by a vote of a majority of the directors (or analogous position)
then still in office who were either directors (or analogous position) at the
beginning of any such period or whose election or nomination for election was
previously so approved) to constitute a majority of the board of directors (or
analogous governing body) of the Shareholder then in office or (E) in
respect of a Shareholder other than RMR, the termination (including by means of
nonrenewal) of the Shareholder’s management agreement with RMR by such
Shareholder or, in response to a breach of such agreement by such Shareholder,
by RMR; provided, however, a Change of Control shall not include:  (1) the
acquisition by any person or entity, or two or more persons or entities acting
in concert, of beneficial ownership of 9.8% or more of the outstanding shares
of voting stock or other voting interests of a Shareholder if such acquisition
is approved by the governing board of such Shareholder in accordance with the
organizational documents of such Shareholder and if such acquisition is
otherwise in compliance with applicable law; (2) the merger or
consolidation of a Shareholder with one or more other Shareholders or wholly
owned subsidiaries of any such Shareholders; or (3) a Change of Control
which is approved by Shareholders owning 75% of the Shares owned by all
Shareholders.


 


(ii)   “Deferred Interest Rate” means the
London Interbank Offered Rate (rounded upward, if necessary, to the nearest
1/100th of 1%)
appearing on Reuters Screen LIBO Page (or any successor page) as the London
interbank offered rate for three month deposits in U.S. dollars at
approximately 11:00 a.m. (London time) two days prior to applicable
closing date (provided that if more than one rate is specified on Reuters
Screen LIBO Page, the applicable rate shall be the arithmetic mean of all such
rates), plus 100 basis points, and this rate shall be adjusted in three
month intervals thereafter, in accordance with the foregoing, with such
adjustment date being treated as an “applicable closing date” for purposes of
determining the adjusted rate in accordance


 


9

















 


with the foregoing, for
so long as any deferred amount pursuant to Sections 3.2(b) or 3.2(c) may
be unpaid.


 


3.4          Permitted New Issuance of Shares.  The prohibition on transfer of
Shares, the preemptive rights and the change of control call options created by
Sections 3.1, 3.2 and 3.3 of this Article III shall not apply to any sale
of Shares by the Company, or by any Shareholder or Shareholders, if the Shares are
sold to an entity which is managed by RMR that purchases insurance from the
Company, provided that any such sale does not reduce the ownership of any
Shareholder to less than ten percent (10%) of the Company’s outstanding voting
Shares.  The prohibition on the preemptive rights and the change of
control call options created by Sections 3.2 and 3.3, respectively, of this Article III
shall not apply to the 20,000 Shares to be issued and sold by the Company to
GOV pursuant to the GOV Subscription Agreement and HRP’s spin off of GOV
pursuant to the initial public offering of GOV shares, which occurred during
2009 and prior to the date of this Agreement, respectively, and the Original
Shareholders waive any rights they may have or have had under Sections 3.2 and
3.3 of this Article III with respect to such transactions.


 


ARTICLE
IV



SPECIAL SHAREHOLDER APPROVAL REQUIREMENTS.


 


4.1          Special Shareholder Approval Requirements.  For so long as the Shareholders
beneficially own a majority of the Company’s issued and outstanding Shares, no
action by the Company shall be taken with respect to any of the following
matters without the prior affirmative approval of Shareholders owning 75% of
the Shares owned by all the Shareholders:


 


(a)       any
amendment to the articles of incorporation or bylaws of the Company;


 


(b)       any
merger of the Company;


 


(c)       the
sale of all or substantially all of the Company’s assets;


 


(d)       any
reorganization or recapitalization of the Company; or


 


(e)       any
liquidation or dissolution of the Company.


 


If applicable
law permits any of the foregoing actions to be taken by the Company without a
shareholders vote, the vote of all directors of the Company designated by a
Shareholder shall be considered the vote of the Shareholder for purposes of any
such action.


 


10

















 


ARTICLE
V



OTHER COVENANTS AND AGREEMENTS


 


5.1          Organizational Documents.  Subject to applicable law, each
Shareholder shall vote its Shares or execute any consents necessary, and each
Shareholder and the Company shall take all other actions necessary, to ensure
that the Company’s organizational documents facilitate, and do not at any time
conflict with any provision of, this Agreement or any applicable law, and to
ensure that the provisions hereof are implemented notwithstanding any
inconsistent provision in the Company’s organizational documents.  The
parties hereto agree to amend, if necessary, the Company’s organizational
documents to conform to the provisions set forth in this Agreement, to the
extent permitted by applicable law.  In the event of any actual or
apparent inconsistency between this Agreement and the organizational documents,
then, as among the Shareholders, to the extent permitted by applicable law,
this Agreement shall control.


 


5.2          Reports and Information Access.  For so long as a Shareholder owns
not less than 10% of all the issued and outstanding Shares, the Company shall
provide periodically, through the director(s) designated by such
Shareholder under Section 2.1, to the Shareholder financial information
regarding the Company and its operations and the Company shall permit the
Shareholder and its representatives reasonable access to the financial reports
and records of the Company so that the Shareholder may comply with its financial
reporting and tax reporting obligations and procedures, and disclosure
obligations under the federal securities laws and other applicable laws.


 


5.3          Compliance with Laws.  The Company shall comply in all
material respects with all applicable laws governing its business and
operations.  Except as provided in Section 5.7, if a Shareholder, by
virtue of such Shareholder’s ownership interest in the Company or actions taken
by the Shareholder affecting the Company, triggers the application of any
requirement or regulation of any federal, state, municipal or other
governmental or regulatory body on the Company or any subsidiary of the Company
or any of their respective businesses, assets or operations, including any
obligations to make any filing with or otherwise notifying or obtaining the
consent, approval or other action of any federal, state, municipal or other
governmental or regulatory body, such Shareholder shall promptly take all
actions necessary and fully cooperate with the Company to ensure that such requirements
or regulations are satisfied without restricting, imposing additional
obligations on or in any way limiting the business, assets, operations or
prospects of the Company or any subsidiary of the Company.  Each
Shareholder shall use best efforts to cause its shareholders, directors (or
analogous position), nominees for director (or analogous position), officers,
employees and agents to comply with any applicable laws impacting the Company
or any of its subsidiaries or their respective businesses, assets or
operations.


 


5.4          Cooperation; Further Assurances.


 


(a)        The
Shareholders shall cooperate with each other and the Company in furtherance of
the Company’s underwriting of insurance policies and coverage with respect to
the Shareholders and their respective businesses, assets and properties as well
as in furtherance of the development and execution of the Company’s business as
an insurer.  The Shareholders


 


11

















 


intend to transition (but
shall not be obligated to do so) their applicable insurance policies and
coverage to the Company so that the Company or its third party agents or
contracting parties shall become the underwriters of such current and future
policies and coverage.


 


(b)        Each
of the parties shall execute such documents and perform such further acts
(including obtaining any consents, exemptions, authorizations or other actions
by, or giving any notices to, or making any filings with, any governmental
authority) as may be reasonably required or desirable to carry out or to
perform the provisions of this Agreement or the transactions contemplated
hereby, including in connection with any subsequent exercise by a party of a
right afforded hereunder to such party.


 


5.5          Confidentiality.  Except as may be required by
applicable law or the rules of any national securities exchange upon which
a party’s shares are listed for trading, none of the parties hereto shall make
any disclosure concerning this Agreement, the transactions contemplated hereby
or the business, operations and financial affairs of the Company without prior
approval by the other parties hereto; provided, however, that nothing in this
Agreement shall restrict any of the parties from disclosing information (a) that
is already publicly available, (b) that was known to such party on a
non-confidential basis prior to any relevant disclosure, (c) that may be
required or appropriate in response to any summons or subpoena or in connection
with any litigation, provided that such party will use reasonable efforts to
notify the other party in advance of such disclosure so as to permit the other
party to seek a protective order or otherwise contest such disclosure, and such
party will use reasonable efforts to cooperate, at the expense of the other party,
with the other party in pursuing any such protective order, (d) to the
extent that such party reasonably believes it appropriate in order to protect
its investment in its Shares in order to comply with any applicable law, (e) to
such party’s officers, directors, trustees, advisors, employees, auditors or
counsel or (f) as warranted pursuant to the parties’ disclosure
obligations under federal securities laws.


 


5.6          Required Regulatory Approvals.  Certain transactions required,
permitted or otherwise contemplated by this Agreement may under certain
circumstances require prior filings with and approvals, or non-disapprovals,
from the Indiana Department of Insurance or the Indiana Insurance
Commissioner.  Such transactions include: (a) issuance or purchase of
any additional capital stock of the Company or other securities convertible
into or exchangeable or exercisable for capital stock of the Company pursuant
to Sections 1.2 or 3.4; (b) transfer of Shares to a wholly owned
subsidiary of a Shareholder, to another Shareholder or to a wholly owned
subsidiary of another Shareholder pursuant to Sections 3.1(a) or 3.4; (c) exercise
of preemptive rights by a Shareholder pursuant to Section 3.2; and (d) exercise
of call rights by the Company or a Shareholder pursuant to Section 3.3
(including pursuant to the two provisos in Section 3.1(b)). 
Notwithstanding anything to the contrary contained in this Agreement, any such
transactions requiring filings with and approvals, or non-disapprovals, from
the Indiana Department of Insurance or the Indiana Insurance Commissioner shall
not, to the extent within the control of a party hereto, be entered into or
consummated unless and until the required filings have been made and the
required approvals (or non-disapprovals) have been obtained, and to the extent
not within the control of an applicable party hereto, such party shall use best
efforts to cause such transactions not to be entered into or consummated unless
and until the required filings have been made and the required approvals (or
non-disapprovals) have been obtained.


 


12

















 


5.7          REIT Matters.  At the request of any Shareholder
that intends (for itself or for any of its affiliates) to qualify and be taxed
as a real estate investment trust under the Internal Revenue Code of 1986, as
amended (the “Code”), the Company shall (a) join with such
Shareholder (or, as applicable, such Shareholder’s affiliate) in making a “taxable
REIT subsidiary” election under Section 856(l) of the Code and (b) otherwise
reasonably cooperate with any request of such Shareholder (or its affiliate)
pertaining to such real estate investment trust status or taxation under the
Code.


 


ARTICLE
VI



REPRESENTATIONS AND WARRANTIES


 


6.1          The Company.  The Company represents and
warrants to each Shareholder, as of the date of this Agreement (unless any such
representation or warranty speaks as of another date, in which case, as of such
date), as follows:


 


(a)        Organization,
Existence, Good Standing and Power.  The Company is an Indiana
insurance company duly organized, validly existing and in good standing under
the laws of the State of Indiana and has the power and authority to execute,
deliver and perform its obligations under this Agreement.


 


(b)        Capitalization;
Subsidiaries.


 


(i)    As of immediately prior to the execution
and delivery of this Agreement, there are no securities of the Company issued
and outstanding, except for the Shares previously issued pursuant to Section 1.1. 
Except as provided and contemplated by this Agreement, as of the date of this
Agreement, the Company has no commitment or arrangement to issue securities of
the Company to any person or entity.


 


(ii)   As of the date of this Agreement, the
Company has no subsidiaries.


 


(c)        Valid
Issuance of Shares.  The Shares being purchased by the Shareholders
hereunder, when issued, sold and delivered in accordance with the terms of this
Agreement for the consideration expressed herein, will be duly and validly
issued, fully paid and nonassessable, and will be free of restrictions on
transfer other than restrictions on transfer under this Agreement and under
applicable law.


 


(d)        Binding
Effect.  This Agreement has been duly executed and delivered by the
Company and constitutes the legal, valid and binding obligations of the
Company, enforceable against it in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, fraudulent conveyance or transfer, moratorium or similar laws
affecting the enforcement of creditors’ rights generally or by equitable
principles relating to enforceability (regardless of whether considered in a
proceeding at law or in equity).


 


13

















 


(e)        No
Contravention.  The execution and delivery of this Agreement by the
Company and the performance of its obligations hereunder and the consummation
by the Company of the transactions contemplated by this Agreement and
compliance by the Company with the provisions of this Agreement (i) have
been duly authorized by all necessary company action, (ii) do not
contravene the terms of the Company’s organizational documents, (iii) do
not materially violate, conflict with or result in any breach or contravention
of, or the creation of any material lien, charge or encumbrance under, any
material agreement, contract, license, permit or instrument to which the
Company is a party or by which the Company or any of its assets or properties
are bound and (iv) do not materially violate any law, statute, regulation,
order or decree applicable to, or binding upon, the Company or any of its
assets or properties.


 


(f)         Consents. 
No approval, consent, compliance, exemption, authorization or other action by,
or notice to, or filing with, any local, state or federal governmental
authority or any other person or entity (individually and collectively, a “Consent”),
not already obtained or made, and no lapse of a waiting period under any
applicable law, statute, regulation, order or decree, is necessary or required
in connection with the execution, delivery or performance by the Company of
this Agreement or the transactions contemplated hereby; provided, however, that
the foregoing representation and warranty shall not apply to any Consent which
may be required in the future as a result of the application of the rights and
obligations provided for hereunder or the conducting of the Company’s business.


 


(g)        Compliance
with Laws.  The Company is in compliance in all material respects with
all applicable laws, statutes, regulations, orders or decrees applicable to, or
binding upon, the Company or any of its assets or properties.


 


(h)        Offering. 
Subject to the accuracy of the Shareholder’s representations and warranties set
forth in Sections 6.2(f) through 6.2(i), the offer, sale and issuance of
the Shares to be issued in conformity with the terms of this Agreement
constitute transactions which are exempt from the registration requirements of
the Securities Act of 1933, as amended (the “Securities Act”), and from
all applicable state registration or qualification requirements.  Neither
the Company nor any person or entity acting on its behalf will take any action
that would cause the loss of such exemption.


 


(i)         No
Integration.  The Company has not, directly or through any agent, sold,
offered for sale, solicited offers to buy or otherwise negotiated in respect
of, any security (as defined in the Securities Act) which is or will be
integrated with the Shares sold pursuant to this Agreement in a manner that
would require the registration of the Shares under the Securities Act.


 


6.2          The Shareholders.  Each Shareholder represents and
warrants to the Company and the other Shareholders, as of the date of this
Agreement, as follows:


 


(a)        Organization,
Existence, Good Standing and Power.  The Shareholder (i) is an
entity duly organized, validly existing and in good standing under the laws of
the jurisdiction of its formation; (ii) has all requisite power and
authority to conduct the business in which it is currently engaged; and (iii) has
the power and authority to execute, deliver and perform its obligations under
this Agreement.


 


14

















 


(b)        Binding
Effect.  This Agreement has been duly executed and delivered by the
Shareholder and constitutes the legal, valid and binding obligations of the
Shareholder, enforceable against it in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, fraudulent conveyance or transfer, moratorium or similar laws
affecting the enforcement of creditors’ rights generally or by equitable
principles relating to enforceability (regardless of whether considered in a
proceeding at law or in equity).


 


(c)        No
Contravention.  The execution and delivery of this Agreement by the
Shareholder and the performance of its obligations hereunder and the
consummation by the Shareholder of the transactions contemplated by this
Agreement and compliance by the Shareholder with the provisions of this
Agreement (i) have been duly authorized by all necessary company action, (ii) do
not contravene the terms of the Shareholder’s organizational documents, (iii) do
not materially violate, conflict with or result in any breach or contravention
of, or, except with respect to any Existing Pledge which the Shareholder or any
of its assets or properties may be subject, the creation of any material lien,
charge or encumbrance under, any material agreement, contract, license, permit
or instrument to which the Shareholder is a party or by which the Shareholder
or any of its assets or properties are bound and (iv) do not materially
violate any law, statute, regulation, order or decree applicable to, or binding
upon, the Shareholder or any of its assets or properties.


 


(d)        Consents. 
No Consent, not already obtained or made, and no lapse of a waiting period
under any applicable law, statute, regulation, order or decree, is necessary or
required in connection with the execution, delivery or performance by the
Shareholder of this Agreement or the transactions contemplated hereby;
provided, however, that the foregoing representation and warranty shall not
apply to any Consent which may be required in the future as a result of the
application of the rights and obligations provided for hereunder or the conducting
of the Company’s business.


 


(e)        Compliance
with Laws.  The Shareholder is in compliance in all material respects
with all applicable laws, statutes, regulations, orders or decrees applicable
to, or binding upon, the Shareholder or any of its assets or properties.


 


(f)         Purchase
Entirely for Own Account.  The Shares are being acquired for
investment for the Shareholder’s own account, not as a nominee or agent, and
not with a view to the resale or distribution of any part thereof, and the
Shareholder has no present intention of selling, granting any participation
with respect to or otherwise distributing the Shares.  Except as provided
by this Agreement, the Shareholder does not have any contract, undertaking,
agreement or arrangement with any person or entity to sell or transfer to any
person or entity, or grant participation rights to any person or entity with
respect to, any of the Shares.


 


(g)        Disclosure
of Information.  The Shareholder has received all the information from
the Company and its management that the Shareholder considers necessary or
appropriate for deciding whether to purchase the Shares hereunder.  The
Shareholder further represents that it has had an opportunity to ask questions
and receive answers from the Company regarding the Company, its financial
condition, results of operations and prospects and the terms and conditions of
the offering of the Shares sufficient to enable it to evaluate its investment.


 


15














 


(h)        Investment
Experience and Accredited Investor Status.  The Shareholder is an “accredited
investor” (as defined in Regulation D under the Securities Act).  The
Shareholder has such knowledge and experience in financial or business matters
that it is capable of evaluating the merits and risks of the investment in the
Shares to be purchased hereunder.


 


(i)         Restricted
Securities.    The Shareholder understands that the Shares,
when issued, shall be “restricted securities” under the federal securities laws
inasmuch as they are being acquired from the Company in a transaction not
involving a public offering and that under such laws the Shares may be resold
without registration under the Securities Act only in certain limited
circumstances.


 


ARTICLE
VII



TERMINATION


 


7.1          Termination.  This Agreement shall remain in
full force and effect until the sooner of:  (a) its termination
pursuant to the next succeeding sentence of this Section 7.1 or (b) the
dissolution of the Company; provided, however, that the dissolution of the
Company, the merger of the Company with, or the transfer of all or
substantially all the assets of the Company to, another entity which continues
substantially all of the Company’s business shall not of itself terminate this
Agreement.  This Agreement may be terminated at any time by the
Shareholders owning at least 75% of the issued and outstanding Shares owned by
all Shareholders.  Section 5.5 and Article VIII shall survive
any termination or expiration of this Agreement.


 


ARTICLE
VIII



MISCELLANEOUS


 


8.1          Notices.  Any notices or other communications required
or permitted under, or otherwise in connection with, this Agreement shall be in
writing and shall be deemed to have been duly given when delivered in person,
upon confirmation of receipt when transmitted by facsimile transmission, on the
next business day if transmitted by a nationally recognized overnight courier
or on the third business day following mailing by first class mail, postage
prepaid, in each case as follows (or at such other United States address or
facsimile number for a party as shall be specified by like notice):


 


Notices to the Company:


 


Affiliates Insurance Company

101 West Washington Street, Suite 1100

Indianapolis, Indiana 46204

Attention:  President/Vice President

Facsimile No.:   (317) 632-2883


 


16

















 


with a copy to:


 


Affiliates Insurance
Company

400 Centre Street

Newton, Massachusetts 02458

Attention:  President/Vice President

Facsimile No.:  (617) 928-1305


 


Notices to FVE:


 


Five Star Quality Care, Inc.

400 Centre Street

Newton, Massachusetts 02458

Attention:  President

Facsimile No.:  (617) 796-8385


 


Notices to HPT:


 


Hospitality Properties Trust

400 Centre Street

Newton, Massachusetts 02458

Attention:  President

Facsimile No.:  (617) 969-5730


 


Notices to HRP:


 


HRPT Properties Trust

400 Centre Street

Newton, Massachusetts 02458

Attention:  President

Facsimile No.:  (617) 332-2261


 


Notices to SNH:


 


Senior Housing Properties Trust

400 Centre Street

Newton, Massachusetts 02458

Attention:  President

Facsimile No.:  (617) 796-8349


 


Notices to TA:


 


TravelCenters of America LLC

24601 Center Ridge Road, Suite 200

Westlake, Ohio 44145

Attention:  President

Facsimile No.:  (440) 808-3301


 


17

















 


Notices to RMR:


 


Reit Management & Research LLC

400 Centre Street

Newton, Massachusetts 02458

Attention:  President

Facsimile No.:  (617) 928-1305


 


and


 


Notices to GOV:


 


Government Properties Income Trust

400 Centre Street

Newton, Massachusetts 02458

Attention:  President

Facsimile No.:  (617) 219-1441


 


8.2          Successors and Assigns; Third Party
Beneficiaries. 
This Agreement shall inure to the benefit of and be binding upon the successors
and permitted assigns of the parties hereto.  Except as permitted by Section 3.1
and Section 3.4, no party may assign this Agreement or its rights
hereunder or delegate its duties hereunder without the written consent of the
other parties.  Except as otherwise provided in Section 8.7, no
person or entity other than the parties hereto and their successors and
permitted assigns is intended to be a beneficiary of this Agreement.


 


8.3          Amendment and Waiver.


 


(a)        No
failure or delay on the part of any party in exercising any right, power or
remedy hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right, power or remedy preclude any other or
further exercise thereof or the exercise of any other right, power or
remedy.  The remedies provided for herein are cumulative and are not exclusive
of any remedies that may be available to each party at law, in equity or
otherwise.  Any party hereto may waive in whole or in part any right
afforded to such party hereunder.


 


(b)        Any
amendment, supplement or modification of or to any provision of this Agreement,
shall be effective upon the written agreement of the Company and the
Shareholders owning not less than 75% of all Shares owned by the Shareholders;
provided, however, that any amendment, supplement or modification of Article I
or Article II shall require the approval of any Shareholder which may be
adversely affected by any such amendment, supplement or modification.


 


8.4          Counterparts.  This Agreement may be executed in
any number of counterparts and by the parties hereto in separate counterparts,
each of which when so executed


 


18

















 


shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement.


 


8.5          Headings.  The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.


 


8.6          Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Indiana without regard to
the conflicts of laws rules thereof, which would require the application
of the laws of another jurisdiction.


 


8.7          Dispute Resolution


 


(a)        Any
disputes, claims or controversies between the parties (i) arising out of
or relating to this Agreement, the Company, its business, assets or operations
or any insurance policies or coverage underwritten by the Company or any of its
third party agents in furtherance of the Company’s insurance business or (ii) brought
by or on behalf of any shareholder of the Company (which, for purposes of this Section 8.7,
shall mean any shareholder of record or any beneficial owner of shares of the
Company, or any former shareholder of record or beneficial owner of shares of
the Company), either on his, her or its own behalf, on behalf of the Company or
on behalf of any series or class of shares of the Company or shareholders of
the Company against the Company or any director, officer, manager (including
RMR or its successor), agent or employee of the Company, including disputes,
claims or controversies relating to the meaning, interpretation, effect,
validity, performance or enforcement of this Agreement or the articles of
incorporation or bylaws of the Company (all of which are referred to as “Disputes”),
or relating in any way to such a Dispute or Disputes shall, on the demand of
any party to such Dispute, be resolved through binding and final arbitration in
accordance with the Commercial Arbitration Rules (the “Rules”) of
the American Arbitration Association (“AAA”) then in effect, except as
those Rules may be modified in this Section 8.7.  For the
avoidance of doubt, and not as a limitation, Disputes are intended to include
derivative actions against directors, officers or managers of the Company and
class actions by a shareholder against those individuals or entities and the
Company.  For the avoidance of doubt, a Dispute shall include a Dispute
made derivatively on behalf of one party against another party.


 


(b)        There
shall be three arbitrators.  If there are only two parties to the Dispute,
each party shall select one arbitrator within 15 days after receipt by
respondent of a copy of the demand for arbitration.  Such arbitrators may
be affiliated or interested persons of such parties.  If either party
fails to timely select an arbitrator, the other party to the Dispute shall
select the second arbitrator who shall be neutral and impartial and shall not
be affiliated with or an interested person of either party.  If there are
more than two parties to the Dispute, all claimants, on the one hand, and all
respondents, on the other hand, shall each select, by the vote of a majority of
the claimants or the respondents, as the case may be, one arbitrator. Such
arbitrators may be affiliated or interested persons of the claimants or the
respondents, as the case may be.  If either all claimants or all
respondents fail to timely select an arbitrator then such arbitrator (who shall
be neutral, impartial and unaffiliated with any party) shall be appointed by
the AAA.  The two arbitrators so appointed shall jointly appoint the third
and presiding arbitrator (who shall be neutral, impartial and unaffiliated with
any party) within 15 days of the appointment of the second arbitrator.  If
the third arbitrator has not been appointed within the


 


19

















 


time limit specified
herein, then the AAA shall provide a list of proposed arbitrators in accordance
with the Rules, and the arbitrator shall be appointed by the AAA in accordance
with a listing, striking and ranking procedure, with each party having a
limited number of strikes, excluding strikes for cause.


 


(c)        The
place of arbitration shall be Indianapolis, Indiana unless otherwise agreed by
the parties.


 


(d)        There
shall be only limited documentary discovery of documents directly related to
the issues in dispute, as may be ordered by the arbitrators.


 


(e)        In
rendering an award or decision (the “Award”), the arbitrators shall be
required to follow the laws of the State of Indiana.  Any arbitration
proceedings or Award rendered hereunder and the validity, effect and
interpretation of this arbitration agreement shall be governed by the Federal
Arbitration Act, 9 U.S.C. §1 et seq.  The Award shall be in writing and
may, but shall not be required to, briefly state the findings of fact and conclusions
of law on which it is based.


 


(f)         Except
to the extent otherwise agreed by the parties, each party involved in a Dispute
shall bear its own costs and expenses (including attorneys’ fees), and the
arbitrators shall not render an award that would include shifting of any such
costs or expenses (including attorneys’ fees) or, in a derivative case or class
action, award any portion of the Company’s award to the claimant or the
claimant’s attorneys.  Each party (or, if there are more than two parties
to the Dispute, all claimants, on the one hand, and all respondents, on the
other hand, respectively) shall bear the costs and expenses of its (or their)
selected arbitrator and the parties (or, if there are more than two parties to
the Dispute, all claimants, on the one hand, and all respondents, on the other
hand) shall equally bear the costs and expenses of the third appointed
arbitrator.


 


(g)        An
Award shall be final and binding upon the parties thereto and shall be the sole
and exclusive remedy between such parties relating to the Dispute, including
any claims, counterclaims, issues or accounting presented to the
arbitrators.  Judgment upon the Award may be entered in any court having
jurisdiction.  To the fullest extent permitted by law, no application or appeal
to any court of competent jurisdiction may be made in connection with any
question of law arising in the course of arbitration or with respect to any
award made except for actions relating to enforcement of this agreement to
arbitrate or any arbitral award issued hereunder and except for actions seeking
interim or other provisional relief in aid of arbitration proceedings in any
court of competent jurisdiction.


 


(h)        Any
monetary award shall be made and payable in U.S. dollars free of any tax,
deduction or offset.  Each party against which the Award assesses a
monetary obligation shall pay that obligation on or before the 30th day following the date of the Award
or such other date as the Award may provide.


 


(i)         This Section 8.7
is intended to benefit and be enforceable by the shareholders, directors,
officers, managers (including RMR or its successor), agents or employees of the
Company and the Company and shall be binding on the shareholders of the


 


20

















 


Company and the Company,
as applicable, and shall be in addition to, and not in substitution for, any
other rights to indemnification or contribution that such individuals or
entities may have by contract or otherwise.


 


8.8          Interpretation and Construction.


 


(a)        The
words “hereof”, “herein”, “hereby” and “hereunder” and words of similar import,
when used in this Agreement, shall refer to this Agreement as a whole and not
to any particular provision of this Agreement.


 


(b)        Unless
the context otherwise requires, references to sections, subsections or Articles
refer to sections, subsections or Articles of this Agreement.


 


(c)        Terms
defined in the singular shall have a comparable meaning when used in the
plural, and vice versa.


 


(d)        The
words “include” and “including” and words of similar import shall be deemed to
be followed by the words “without limitation”.


 


(e)        Words
importing gender include both genders.


 


(f)         Any
agreement, instrument or statute defined or referred to herein or in any
agreement or instrument that is referred to herein means such agreement,
instrument or statute as from time to time amended, modified or supplemented,
including (in the case of agreements or instruments) by waiver or consent and
(in the case of statutes) by succession of comparable successor statutes and
references to all attachments thereto and instruments incorporated
therein.  In addition, references to any statute are to that statute and
to the rules and regulations promulgated thereunder.


 


(g)        The
parties hereto have participated jointly in the negotiation and drafting of
this Agreement and, in the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as jointly drafted by
the parties hereto and no presumption or burden of proof shall arise favoring
or disfavoring any party by virtue of the authorship of any provision of this
Agreement.


 


8.9          Severability.  If any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable in any respect for any reason, the
validity, legality and enforceability of any such provision in every other
respect and of the remaining provisions hereof shall not be in any way
impaired, unless the provisions held invalid, illegal or unenforceable shall
substantially impair the benefits of the remaining provisions hereof.


 


8.10        Entire Agreement.  This Agreement and the GOV
Subscription Agreement constitute the entire agreement, and supersede all prior
agreements and understandings, both written and oral, among the parties with
respect to the subject matter of this Agreement.


 


21

















 


8.11        Non-liability of Trustees and Directors.


 


(a)        COPIES
OF THE DECLARATIONS OF TRUST OF HPT, HRP, SNH AND GOV, AS IN EFFECT ON THE DATE
HEREOF, TOGETHER WITH ALL AMENDMENTS AND SUPPLEMENTS THERETO, IF ANY, ARE DULY
FILED IN THE OFFICE OF THE STATE DEPARTMENT OF ASSESSMENTS AND TAXATION OF
MARYLAND.  THE DECLARATIONS OF TRUST, AS AMENDED AND SUPPLEMENTED, OF HPT,
HRP, SNH AND GOV, PROVIDE THAT NO TRUSTEE, OFFICER, SHAREHOLDER, EMPLOYEE OR
AGENT OF HPT, HRP, SNH OR GOV, AS APPLICABLE, SHALL BE HELD TO ANY PERSONAL
LIABILITY, JOINTLY OR SEVERALLY, FOR ANY OBLIGATION OF, OR CLAIM AGAINST, HPT,
HRP, SNH OR GOV.  ALL PERSONS DEALING WITH HPT, HRP, SNH OR GOV IN ANY
WAY, SHALL LOOK ONLY TO THE ASSETS OF HPT, HRP, SNH OR GOV, AS APPLICABLE, FOR
THE PAYMENT OF ANY SUM OR THE PERFORMANCE OF ANY OBLIGATION.


 


(b)        A COPY
OF THE ARTICLES OF INCORPORATION, AS IN EFFECT ON THE DATE HEREOF, OF FVE,
TOGETHER WITH ALL AMENDMENTS AND SUPPLEMENTS THERETO, IS DULY FILED IN THE
OFFICE OF THE STATE DEPARTMENT OF ASSESSMENTS AND TAXATION OF MARYLAND. 
NO DIRECTOR, OFFICER, SHAREHOLDER, EMPLOYEE OR AGENT OF FVE SHALL BE HELD TO
ANY PERSONAL LIABILITY, JOINTLY OR SEVERALLY, FOR ANY OBLIGATION OF, OR CLAIM
AGAINST, FVE.  ALL PERSONS DEALING WITH FVE, IN ANY WAY, SHALL LOOK ONLY
TO THE ASSETS OF FVE FOR THE PAYMENT OF ANY SUM OR THE PERFORMANCE OF ANY
OBLIGATION.


 


(c)        A COPY
OF THE LIMITED LIABILITY COMPANY AGREEMENT, AS IN EFFECT ON THE DATE HEREOF, OF
TA, TOGETHER WITH ALL AMENDMENTS THERETO, IS AVAILABLE TO A SHAREHOLDER PARTY
HERETO UPON WRITTEN REQUEST MADE TO TA.  NO DIRECTOR, OFFICER,
SHAREHOLDER, EMPLOYEE OR AGENT OF TA SHALL BE HELD TO ANY PERSONAL LIABILITY,
JOINTLY OR SEVERALLY, FOR ANY OBLIGATION OF, OR CLAIM AGAINST, TA.  ALL
PERSONS DEALING WITH TA, IN ANY WAY, SHALL LOOK ONLY TO THE ASSETS OF TA FOR
THE PAYMENT OF ANY SUM OR THE PERFORMANCE OF ANY OBLIGATION.


 


[The Remainder of This Page Intentionally
Left Blank]


 


22

















 


IN
WITNESS WHEREOF, the undersigned have executed, or have caused to be executed,
this Amended and Restated Shareholders Agreement on the date first written
above.


 


	
  AFFILIATES
  INSURANCE COMPANY

  	
   

  	
  SENIOR
  HOUSING PROPERTIES TRUST

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Jennifer B. Clark

  	
   

  	
  By:

  	
  /s/ David J. Hegarty

  
	
   

  	
  Name: Jennifer B. Clark

  	
   

  	
   

  	
  Name: David J. Hegarty

  
	
   

  	
  Title:
    President

  	
   

  	
   

  	
  Title:   President

  
	
   

  	
   

  	
   

  
	
  FIVE
  STAR QUALITY CARE, INC.

  	
   

  	
  TRAVELCENTERS
  OF AMERICA LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Bruce J. Mackey

  	
   

  	
  By:

  	
  /s/ Mark R. Young

  
	
   

  	
  Name: Bruce J. Mackey

  	
   

  	
   

  	
  Name: Mark R. Young

  
	
   

  	
  Title:   President

  	
   

  	
   

  	
  Title:   Executive
  Vice President and General Counsel

  
	
   

  	
   

  	
   

  
	
  HOSPITALITY
  PROPERTIES TRUST

  	
   

  	
  REIT
  MANAGEMENT & RESEARCH LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Mark L. Kleifges

  	
   

  	
  By:

  	
  /s/ Richard A.
  Doyle, Jr.

  
	
   

  	
  Name: Mark L. Kleifges

  	
   

  	
   

  	
  Name: Richard A.
  Doyle, Jr.

  
	
   

  	
  Title:
    Chief Financial Officer

  	
   

  	
   

  	
  Title:
    Senior Vice President

  
	
   

  	
   

  	
   

  
	
  HRPT
  PROPERTIES TRUST

  	
   

  	
  GOVERNMENT
  PROPERTIES INCOME TRUST

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ John A. Mannix

  	
   

  	
  By:

  	
  /s/ David M. Blackman

  
	
   

  	
  Name: John A. Mannix

  	
   

  	
   

  	
  Name: David M. Blackman

  
	
   

  	
  Title:   President

  	
   

  	
   

  	
  Title: 
   Chief Financial Officer