Exhibit 10.1


 


BUSINESS
MANAGEMENT AGREEMENT


 


THIS BUSINESS MANAGEMENT
AGREEMENT
(this “Agreement”) is entered into effective as of June 8, 2009, by
and between HRPT Properties Trust, a Maryland real estate investment trust (the
“Company”), and Reit Management &
Research LLC, a Delaware limited liability company (the “Manager”).


 


WHEREAS, the Company and the Manager are parties
to an Advisory Agreement, dated as of January 1, 1998, as amended (the “Advisory
Agreement”); and


 


WHEREAS, the Company and Manager wish to amend
and restate the Advisory Agreement as hereinafter provided;


 


NOW, THEREFORE, in consideration of the mutual
agreements herein set forth, the parties hereto agree as follows:


 


1.             Engagement. 
Subject to the terms and conditions hereinafter set forth, the Company
hereby continues to engage the Manager to provide the management and real
estate investment services contemplated by this Agreement with respect to the
Company’s business and real estate investments and the Manager hereby accepts
such continued engagement.


 


2.             General Duties of the
Manager.  The Manager shall use its reasonable best
efforts to present to the Company a continuing and suitable real estate
investment program consistent with the real estate investment policies and
objectives of the Company.  Subject to
the management, direction and supervision of the Company’s Board of Trustees
(the “Trustees”), the Manager shall:


 


(a)     provide research and economic and
statistical data in connection with the Company’s real estate investments and
recommend changes in the Company’s real estate investment policies when
appropriate;


 


(b)     (i) investigate and evaluate
investments in, or acquisitions or dispositions of, real estate and related
interests, and financing and refinancing opportunities, (ii) make
recommendations concerning specific investments to the Trustees, and (iii) evaluate
and negotiate contracts with respect to the foregoing, in each case, on behalf
of the Company and in the furtherance of the Company’s real estate financing
objectives;


 


(c)     investigate, evaluate and negotiate
the prosecution and negotiation of any claims of the Company in connection with
its real estate investments;


 

















 


(d)    administer bookkeeping and accounting
functions as are required for the management and operation of the Company,
contract for audits and prepare or cause to be prepared such reports and
filings as may be required by any governmental authority in connection with the
ordinary conduct of the Company’s business, and otherwise advise and assist the
Company with its compliance with applicable legal and regulatory requirements,
including without limitation, periodic reports, returns or statements required
under the Securities Exchange Act of 1934, as amended, the Internal Revenue
Code of 1986, as amended (said Code, as in effect from time to time, together
with any regulations and rulings thereunder, being hereinafter referred to as
the “Internal Revenue Code”), the
securities and tax statutes of any jurisdiction in which the Company is
obligated to file such reports, or the rules and regulations promulgated
under any of the foregoing;


 


(e)     advise and assist in the preparation
and filing of all offering documents (public and private), and all registration
statements, prospectuses or other documents filed with the Securities and
Exchange Commission (the “SEC”) or any state (it being understood that
the Company shall be responsible for the content of any and all of its offering
documents and SEC filings (including without limitation those filings referred
to in Section 2(d) hereof), and the Manager shall not
be held liable for any costs or liabilities arising out of any misstatements or
omissions in the Company’s offering documents or SEC filings, whether or not
material, and the Company shall promptly indemnify the Manager from such costs
and liabilities);


 


(f)      retain counsel, consultants and other
third party professionals on behalf of the Company;


 


(g)     provide internal audit services as
hereinafter provided;


 


(h)     advise and assist with the Company’s
risk management and oversight function;


 


(i)      to the extent not covered above,
advise and assist the Company in the review and negotiation of the Company’s
contracts and agreements, coordination and supervision of all third party legal
services and oversight of processing of claims by or against the Company;


 


(j)      advise and assist the Company with
respect to the Company’s public relations, preparation of marketing materials,
internet website and investor relations services;


 


(k)     provide office space, office
equipment and the use of accounting or computing equipment when required;


 


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(l)      advise and assist with respect to:
the design, operation and maintenance of network infrastructure, including
telephone and data transmission lines, voice mail, facsimile machines, cellular
phones, pager, etc.; and local area network and wide area network
communications support; and


 


(m)    provide personnel necessary for the
performance of the foregoing services.


 


In
performing its services under this Agreement, the Manager may utilize
facilities, personnel and support services of various of its affiliates.  The Manager shall be responsible for paying
such affiliates for their personnel and support services and facilities out of
its own funds unless otherwise approved by a majority vote of the Independent
Trustees (the “Independent Trustees”), as defined in the Company’s
Declaration of Trust and Bylaws, in each case, as in effect from time to time
(the “Declaration of Trust” and the “Bylaws”, respectively).  Notwithstanding the foregoing, fees, costs
and expenses of any third party which is not an affiliate of the Manager
retained as permitted hereunder are to be paid by the Company.  Without limiting the foregoing sentence, any
such fees, cost or expenses referred to in the immediately preceding sentence
which may be paid by the Manager shall be reimbursed to the Manager by the
Company promptly following submission to the Company of a statement of any such
fees, costs or expenses by the Manager.


 


Notwithstanding
anything herein, it is understood and agreed that the duties of, and services
to be provided by, the Manager pursuant to this Agreement shall not include any
investment management or related services with respect to any assets of the
Company as the Company may wish to allocate from time to time to investments in
“securities” (as defined in the Investment Advisers Act of 1940, as amended).


 


In
performing its services hereunder with respect to the Company, the Manager
shall adhere to, and shall require its officers and employees in the course of
providing such services to the Company to adhere to, the Company’s Code of
Business Conduct and Ethics, as in effect from time to time.  In addition, the Manager shall make available
to its officers and employees providing such services to the Company the
procedures for the receipt, retention and treatment of complaints regarding
accounting, internal accounting controls or auditing matters relating to the
Company and for the confidential, anonymous submission by such officers and
employees of concerns regarding questionable accounting or auditing matters
relating to the Company, as set forth in the Company’s Procedures for Handling
Concerns or Complaints about Accounting, Internal Accounting Controls or
Auditing Matters, as in effect from time to time.


 


3.             Bank Accounts. 
The Manager shall establish and maintain one or more bank accounts in
its own name or, at the direction of the Trustees, in the name of the Company,
and shall collect and deposit into such account or accounts and disburse
therefrom any monies on behalf of the Company, provided that no funds in
any such account shall be commingled with any funds of the Manager or any other
person or entity.  The Manager shall from
time to time, or 


 


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at any time requested by
the Trustees, render an appropriate accounting of such collections and payments
to the Trustees and to the auditors of the Company.


 


4.             Records. 
The Manager shall maintain appropriate books of account and records
relating to this Agreement, which books of account and records shall be
available for inspection by representatives of the Company upon reasonable
notice during ordinary business hours.


 


5.             Information Furnished to
Manager.  The Trustees shall at all times keep the
Manager fully informed with regard to the real estate investment policies of
the Company, the capitalization policy of the Company, and generally the
Trustees’ then-current intentions as to the future of the Company.  In particular, the Trustees shall notify the
Manager promptly of their intention to sell or otherwise dispose of any of the
Company’s real estate investments or to make any new real estate
investment.  The Company shall furnish
the Manager with such information with regard to its affairs as the Manager may
from time to time reasonably request. 
The Company shall retain legal counsel and accountants to provide such
legal and accounting advice and services as the Manager or the Trustees shall
deem necessary or appropriate to adequately perform the functions of the
Company, and shall have such legal or accounting opinions and advice as the
Manager shall reasonably request.


 


6.             REIT Qualification;
Compliance with Law and Organizational Documents. 
Anything else in this Agreement to the contrary notwithstanding, the
Manager shall refrain from any action (including, without limitation, the
furnishing or rendering of services to tenants of property or managing real
property) which, in its good faith judgment, or in the judgment of the Trustees
as transmitted to the Manager in writing, would (a) adversely affect the
qualification of the Company as a real estate investment trust as defined and
limited in the Internal Revenue Code or which would make the Company subject to
the Investment Company Act of 1940, as amended (the “1940 Act”), (b) violate
any law or rule, regulation or statement of policy of any governmental body or
agency having jurisdiction over the Company or over its securities, or (c) not
be permitted by the Declaration of Trust or Bylaws, except if such action shall
be approved by the Trustees, in which event the Manager shall promptly notify
the Trustees of the Manager’s judgment that such action would adversely affect
such qualification, make the Company subject to the 1940 Act or violate any
such law, rule, regulation or policy, or the Declaration of Trust or Bylaws and
shall refrain from taking such action pending further clarification or
instructions from the Trustees.  In
addition, the Manager shall take such affirmative steps which, in its judgment
made in good faith, or in the judgment of the Trustees as transmitted to the
Manager in writing, would prevent or cure any action described in (a), (b) or
(c) above.


 


7.             Self-Dealing. 
Neither the Manager nor any affiliate of the Manager shall sell any
property or assets to the Company or purchase any property or assets from the
Company, directly or indirectly, except as approved by a majority of the
Independent Trustees (or otherwise pursuant to the Declaration of Trust or
Bylaws).  In addition, except as
otherwise provided in Section 2, 10, 11 or 12
hereof, or except as approved by a majority of the Independent Trustees (or
otherwise pursuant to the Declaration of Trust or Bylaws), neither the Manager
nor any affiliate of the Manager shall receive any commission or other
remuneration, directly or 


 


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indirectly, in connection
with the activities of the Company or any joint venture or partnership in which
the Company is a party.  Except for
compensation received by the Manager pursuant to Section 10
hereof, all commissions or other remuneration proposed to be received by the
Manager or an affiliate of the Manager and not approved by the Independent
Trustees (or otherwise pursuant to the Declaration of Trust or Bylaws) under Section 2,
11 or 12 hereof or this Section 7 shall be
promptly reported to the Company for consideration by the Independent Trustees.


 


8.             No Partnership or Joint
Venture.  The Company and the Manager are not partners
or joint venturers with each other and neither the terms of this Agreement nor
the fact that the Company and the Manager have joint interests in any one or
more investments, ownership or other interests in any one or more entities or
may have common officers or employees or a tenancy relationship shall be
construed so as to make them such partners or joint venturers or impose any
liability as such on either of them.


 


9.             Fidelity Bond. 
The Manager shall not be required to obtain or maintain a fidelity bond
in connection with the performance of its services hereunder.


 


10.           Compensation.


 


(a)     The Manager shall be paid, for the
services rendered by it to the Company pursuant to this Agreement, an annual
management fee (the “Management Fee”).  The Management Fee for each full fiscal year
shall equal the sum of seven tenths of one percent (0.7%) of the Annual Average
Invested Capital (as defined below) up to $250,000,000, plus one half of one
percent (0.5%) of the Annual Average Invested Capital exceeding
$250,000,000.  The Management Fee shall
be prorated for any partial fiscal year of the Company during the term of this
Agreement.


 


(b)     In addition, the Manager shall be
paid an annual incentive fee (the “Incentive Fee”)
for each fiscal year of the Company, consisting of a number of shares of the
Company’s common shares of beneficial interest (“Common
Shares”) with an aggregate value (determined as provided below)
equal to fifteen percent (15%) of the product of (i) the weighted average
Common Shares of the Company outstanding on a fully diluted basis during such
fiscal year and (ii) the excess if any of FFO Per Share (as defined below)
for such fiscal year over the FFO Per Share for the preceding fiscal year.  In no event shall the aggregate value of the
Incentive Fee (as determined pursuant to the immediately preceding sentence)
payable in respect of any fiscal year exceed $.01 multiplied by the weighted
average number of Common Shares outstanding on a fully diluted basis during
such fiscal year.  (The Management Fee
and Incentive Fee are hereinafter collectively referred to as the “Fees”.)


 


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(c)     For purposes of this Agreement:  (i) “Annual Average Invested Capital”
of the Company shall mean the average of the aggregate historical cost of the
consolidated assets of the Company and its subsidiaries invested, directly or
indirectly, in equity interests in or loans secured by real estate and personal
property owned in connection with such real estate (including acquisition
related costs and costs which may be allocated to intangibles or are
unallocated), all before reserves for depreciation, amortization, impairment
charges or bad debts or other similar noncash reserves, computed by taking the
average of such values at the end of each month during such period, other than
any such interest of the Company or its subsidiaries as a result of its
ownership of the securities of the Company’s former subsidiary, Government
Properties Income Trust (“GOV”); and (ii) “FFO Per Share”
for any fiscal year shall mean (x) the Company’s consolidated net income,
computed in accordance with generally accepted accounting principles in the
United States, excluding gain or loss on sale of properties, acquisition costs
and extraordinary items, depreciation, amortization, impairment charges and
other non-cash items, including the Company’s pro rata share of the funds from
operations (determined in accordance with this clause) for such fiscal year of (A) any
unconsolidated subsidiary and (B) any entity for which the Company
accounts by the equity method of accounting but not including (C) any
income, loss or funds from operations attributable to (I) the Company’s or
its subsidiaries’ equity investment in GOV or (II) for the Company’s 2008
and 2009 fiscal years, the assets contributed to GOV or its subsidiaries by the
Company or its subsidiaries prior to completion of the initial public offering
of common shares of beneficial interest of GOV (the “GOV IPO”), with
such resulting net income amount reduced by, if applicable, the amount of any
preferred shares dividends declared or otherwise payable (without duplication)
during such fiscal year, determined for these purposes as of the date any such
preferred shares dividend amounts are accrued by the Company in accordance with
generally accepted accounting principles in the United States divided by (y) the
weighted average number of Common Shares outstanding on a fully diluted basis
during such fiscal year.  It is agreed
and understood that, for purposes of this agreement, GOV and its subsidiaries
shall not constitute a subsidiary of the Company or its subsidiaries.


 


Unless
the Company and the Manager otherwise agree, the Management Fee shall be
computed and payable monthly by the Company on a year to date basis, with
adjustments to account for previous payments, within thirty (30) days following
the end of each fiscal month, and the Incentive Fee shall be computed and
payable within thirty (30) days following the public availability of the
Company’s annual audited financial statements for each fiscal year.  Such computations of the Management Fee shall
be based upon the Company’s monthly or quarterly financial statements, as the
case may be, and such computations of the Incentive Fee shall be based upon the
Company’s annual audited financial statements, and all such computations shall
be in reasonable detail.  A copy of such
computations shall promptly be delivered to the Manager accompanied by payment
of the Fees shown thereon to be due and payable.


 


The
payment of the aggregate annual Fees payable for any fiscal year shall be
subject to adjustment as of the end of each fiscal year. On or before the 30th
day after public availability of the Company’s annual audited financial statements
for each fiscal year, the Company shall 


 


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deliver to the Manager an officer’s certificate (a “Certificate”) reasonably acceptable to the
Manager and certified by an authorized officer of the Company setting forth (i) the
Annual Average Invested Capital and FFO Per Share for the Company’s fiscal year
ended upon the immediately preceding December 31, and (ii) the
Company’s computation of the Fees payable for said fiscal year.


 


If the
aggregate annual Fees payable for said fiscal year as shown in such Certificate
exceed the aggregate amounts previously paid with respect thereto by the
Company, the Company shall include its check for such deficit and deliver the
same to the Manager with such Certificate.


 


If the
aggregate annual Fees payable for said fiscal year as shown in such Certificate
are less than the aggregate amounts previously paid with respect thereto by the
Company, the Company shall specify in such Certificate whether the Manager
should (i) remit to the Company its check in an amount equal to such
difference or (ii) grant the Company a credit against the Fees next coming
due in the amount of such difference until such amount has been fully paid or
otherwise discharged.


 


Payment
of the Incentive Fee shall be made by issuance of Common Shares under the
Company’s 2003 Incentive Share Award Plan, as the same may be amended from time
to time.  The number of shares to be
issued in payment of the Incentive Fee shall be the whole number of shares
(disregarding any fraction) equal to the value of the Incentive Fee, as
provided above, divided by the average closing price of the Company’s Common
Shares on the New York Stock Exchange (or such other stock exchange upon which
the Common Shares are principally listed for trading) during the month of December in
the year for which the computation is made.


 


11.           Internal Audit Services.   
The Manager shall provide to the Company an internal audit function
meeting applicable requirements of the New York Stock Exchange and the
Securities and Exchange Commission and otherwise in scope approved by the
Company’s Audit Committee.  In addition
to the Fees, the Company agrees to reimburse the Manager, within 30 days of the
receipt of the invoice therefor, the Company’s pro rata share (as reasonably
agreed to by the Independent Trustees from time to time) of the following:


 


(a)     employment expenses of the Manager’s
internal audit manager and other employees of the Manager actively engaged in
providing internal audit services, including but not limited to salary, wages,
payroll taxes and the cost of employee benefit plans; and


 


(b)     the reasonable travel and other
out-of-pocket expenses of the Manager relating to the activities of the Manager’s
internal audit manager and other of the Manager’s employees actively engaged in
providing internal audit services and the 


 


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reasonable third party expenses which
the Manager incurs in connection with its provision of internal audit services.


 


12.           Additional Services.  
If, and to the extent that, the Company shall request the Manager to
render services on behalf of the Company other than those required to be
rendered by the Manager in accordance with the terms of this Agreement, such
additional services shall be compensated separately on terms to be agreed upon
between the Manager and the Company from time to time.


 


13.           Expenses of the Manager. 
Without regard to and without limiting the compensation received by the
Manager from the Company pursuant to this Agreement and except to the extent
provided by Sections  2, 11 or 12, the Manager shall
bear the following expenses incurred in connection with the performance of its
duties under this Agreement:


 


(a)     employment expenses of the personnel
employed by the Manager, including but not limited to, salaries, wages, payroll
taxes and the cost of employee benefit plans;


 


(b)     fees and travel and
other expenses paid to directors, officers and employees
of the Manager, except fees and travel and other expenses of such persons who
are Trustees or officers of the Company incurred in their capacities as
Trustees or officers of the Company;


 


(c)     rent,
telephone, utilities, office furniture, equipment and machinery (including
computers, to the extent utilized) and other office expenses of the Manager,
except to the extent such expenses relate solely to an office maintained by the
Company separate from the office of the Manager; and


 


(d)     miscellaneous administrative expenses
relating to performance by the Manager of its obligations hereunder.


 


14.           Expenses of the Company. 
Except as expressly otherwise provided in this Agreement, the Company
shall pay all its expenses not payable by the Manager, and, without limiting
the generality of the foregoing, it is specifically agreed that the following
expenses of the Company shall be paid by the Company and shall not be paid by
the Manager:


 


(a)     the cost of borrowed money;


 


(b)     taxes on income and taxes and
assessments on real and personal property, if any, and all other taxes
applicable to the Company;


 


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(c)     legal, auditing, accounting,
underwriting, brokerage, listing, reporting, registration and other fees, and
printing, engraving and other expenses and taxes incurred in connection with
the issuance, distribution, transfer, trading, registration and stock exchange
listing of the Company’s securities, including transfer agent’s, registrar’s
and indenture trustee’s fees and charges;


 


(d)     expenses of organizing, restructuring,
reorganizing or terminating the Company, or of revising, amending, converting
or modifying the Company’s organizational documents;


 


(e)     fees and travel and other expenses
paid to Trustees and officers of the Company in their capacities as such (but
not in their capacities as officers or employees of the Manager) and fees and
travel and other expenses paid to advisors, contractors, mortgage servicers,
consultants, and other agents and independent contractors employed by or on
behalf of the Company;


 


(f)      expenses directly connected with the
investigation, acquisition, disposition or ownership of real estate interests
or other property (including third party property diligence costs, appraisal
reporting, the costs of foreclosure, insurance premiums, legal services,
brokerage and sales commissions, maintenance, repair, improvement and local
management of property), other than expenses with respect thereto of employees
of the Manager, to the extent that such expenses are to be borne by the Manager
pursuant to Section 13 above;


 


(g)     all insurance costs incurred in
connection with the Company (including officer and trustee liability insurance)
or in connection with any officer and trustee indemnity agreement to which the
Company is a party;


 


(h)     expenses connected with payments of
dividends or interest or contributions in cash or any other form made or caused
to be made by the Trustees to holders of securities of the Company;


 


(i)      all expenses connected with
communications to holders of securities of the Company and other bookkeeping
and clerical work necessary to maintaining relations with holders of
securities, including the cost of preparing, printing, posting, distributing
and mailing certificates for securities and proxy solicitation materials and
reports to holders of the Company’s securities;


 


(j)      legal, accounting and auditing fees
and expenses, other than those described in subsection (c) above;


 


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(k)     filing and recording fees for
regulatory or governmental filings, approvals and notices to the extent not
otherwise covered by any of the foregoing items of this Section 14;


 


(l)     expenses relating to any office or
office facilities maintained by the Company separate from the office of the
Manager; and


 


(m)    the costs and expenses of all equity
award or compensation plans or arrangements established by the Company,
including the value of awards made by the Company to the Manager or its
employees, if any.


 


15.           Limits of Manager
Responsibility; Indemnification; Company Remedies. 
The Manager assumes no responsibility other than to render the services
described herein in good faith and shall not be responsible for any action of
the Trustees in following or declining to follow any advice or recommendation
of the Manager.  The Manager, its
shareholders, directors, officers, employees and affiliates will not be liable
to the Company, its shareholders, or others, except by reason of acts
constituting bad faith, willful or wanton misconduct or gross negligence in the
performance of its obligations hereunder. 
The Company shall reimburse, indemnify and hold harmless the Manager,
its shareholders, directors, officers and employees and its affiliates for and
from any and all expenses, losses, damages, liabilities, demands, charges and
claims of any nature whatsoever (including without limitation all reasonable
attorneys’, accountants’ and experts’ fees and expenses) in respect of or
arising from any acts or omissions of the Manager with respect to the provision
of services by it or performance of its obligations in connection with this
Agreement or performance of other matters pursuant to specific instruction by
the Trustees, except to the extent such provision or performance was in willful
bad faith or grossly negligent.  Without
limiting the foregoing, the Company shall promptly advance expenses incurred by
the indemnitees referred to in this section for matters referred to in this
section, upon request for such advancement.


 


16.           Other Activities of
Manager.  Nothing herein shall prevent the Manager from
engaging in other activities or businesses or from acting as the Manager to any
other person or entity (including other real estate investment trusts) even
though such person or entity has investment policies and objectives similar to
those of the Company.  The Manager shall
notify the Company in writing in the event that it does so act as a manager to
another business.  The Company
acknowledges that the Manager manages real estate investment trusts and other
entities (including, as of the date of this Agreement, Hospitality Properties
Trust, GOV, Senior Housing Properties Trust, Five Star Quality Care, Inc.
and TravelCenters of America LLC) and that the Manager shall be free from any
obligation to present to the Company any particular investment opportunity
which comes to the Manager and the Manager is not required to present the
Company with opportunities to invest in properties that are primarily of a type
that are the investment focus of another person or entity now or in the future
managed by the Manager.  In addition,
nothing herein shall prevent any shareholder or affiliate of the Manager from
engaging in any other business or from rendering services of any kind to any
other person or entity (including competitive business activities).  The Company acknowledges and agrees that the 


 


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Manager has certain
interests that may be divergent from those of the Company.  The parties agree that these relationships
and interests shall not affect either party’s rights and obligations under this
Agreement.  Without limiting the
foregoing provisions, the Manager agrees, upon the request of any Trustee, to
disclose certain real estate investment information concerning the Manager or
certain of its affiliates; provided, however, that such
disclosure shall be required only if it does not constitute a breach of any
fiduciary duty or obligation of the Manager and the Company shall be required
to keep such information confidential.


 


Directors,
officers, employees and agents of the Manager or of its affiliates may serve as
Trustees, officers, employees, agents, nominees or signatories of the
Company.  When executing documents or
otherwise acting in such capacities for the Company, such persons shall use
their respective titles in the Company. 
Such persons shall receive no compensation from the Company for their
services to the Company in any such capacities, except that the Company may make
awards to the employees of the Manager and others under the Company’s 2003
Incentive Share Award Plan or any equity plan adopted by the Company from time
to time.


 


17.           Term, Termination. 
This Agreement shall continue in force and effect until December 31,
2009, and is renewable annually thereafter by the Company, upon such terms and
conditions as may be approved by a majority of the Independent Trustees serving
on the Compensation Committee of the Trustees.


 


Notwithstanding any other provision of this Agreement
to the contrary, this Agreement, or any extension thereof, may be terminated by
either party thereto upon sixty (60) days’ written notice to the other party,
which termination, if by the Company, must be approved by a majority vote of
the Independent Trustees serving on the Compensation Committee of the Trustees,
or if by the Manager, must be approved by a majority vote of the directors of
the Manager.


 


Section 18
hereof shall govern the rights, liabilities and obligations of the parties upon
termination of this Agreement; and, except as provided in Section 18,
such termination shall be without further liability of either party to the
other, other than for breach or violation of this Agreement prior to
termination.


 


18.           Action Upon Termination. 
From and after the effective date of any termination of this Agreement
pursuant to Section 17 hereof, the Manager shall be entitled
to no compensation for services rendered hereunder for the pro-rata remainder
of the then-current term of this Agreement, but shall be paid, on a pro rata
basis as set forth in this Section 18, all compensation due
for services performed prior to the effective date of such termination,
including without limitation, a pro-rata portion of the current year’s
Incentive Fee. Upon such termination, the Manager shall as promptly as
practicable:


 


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(a)     pay over to the Company all monies
collected and held for the account of the Company by it pursuant to this
Agreement, after deducting therefrom any accrued Fees  and reimbursements for its expenses to which
it is then entitled;


 


(b)     deliver to the Trustees a full and
complete accounting, including a statement showing all sums collected by it and
a statement of all sums held by it for the period commencing with the date
following the date of its last accounting to the Trustees; and


 


(c)     deliver to the Trustees all property
and documents of the Company then in its custody or possession.


 


The
amount of Fees paid to the Manager upon termination shall be subject to
adjustment pursuant to the following mechanism. 
On or before the 30th day after public availability of the Company’s
annual audited financial statements for the fiscal year in which termination
occurs, the Company shall deliver to the Manager a Certificate reasonably
acceptable to the Manager and certified by an authorized officer of the Company
setting forth (i) the Annual Average Invested Capital and FFO Per Share
for the Company’s fiscal year ended upon the immediately preceding December 31,
and (ii) the Company’s computation of the Fees payable upon the date of
termination.


 


If the
annual Fees owed upon termination as shown in such Certificate exceed the Fees
paid by the Company upon termination, the Company shall include its check for
such deficit and deliver the same to the Manager with such Certificate.  If the annual Fees owed upon termination as
shown in such Certificate are less than the Fees paid by the Company upon
termination, the Manager shall remit to the Company its check in an amount
equal to such difference.


 


The
Incentive Fee for any partial fiscal year will be determined by multiplying the
Incentive Fee for such year (assuming this Agreement were in effect for the
entire year) by a fraction, the numerator of which is the number of days in the
portion of such year during which this Agreement was in effect, and the
denominator of which shall be 365.


 


19.           Trustee Action. 
Wherever action on the part of the Trustees is contemplated by this
Agreement, action by a majority of the Trustees, including a majority of the
Independent Trustees, shall constitute the action provided for herein.


 


20.           TRUSTEES AND SHAREHOLDERS
NOT LIABLE.  THE DECLARATION OF TRUST OF THE COMPANY, A
COPY OF WHICH, TOGETHER WITH ALL AMENDMENTS, IS DULY FILED IN THE OFFICE OF THE
DEPARTMENT OF ASSESSMENTS AND TAXATION OF THE STATE OF MARYLAND PROVIDES THAT
THE NAME HRPT PROPERTIES TRUST REFERS TO THE TRUSTEES COLLECTIVELY AS TRUSTEES,
BUT NOT INDIVIDUALLY OR PERSONALLY.  NO
TRUSTEE, OFFICER, 


 


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SHAREHOLDER, EMPLOYEE OR
AGENT OF THE COMPANY SHALL BE HELD TO ANY PERSONAL LIABILITY, JOINTLY OR
SEVERALLY, FOR ANY OBLIGATION OF, OR CLAIM AGAINST, THE COMPANY.  ALL PERSONS DEALING WITH THE COMPANY, IN ANY
WAY, SHALL LOOK ONLY TO THE ASSETS OF THE COMPANY FOR THE PAYMENT OF ANY SUM OR
THE PERFORMANCE OF ANY OBLIGATION.


 


21.           Notices. 
Any notice, report or other communication required or permitted to be
given hereunder 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):


 


If to
the Company:


 


HRPT Properties Trust

400 Centre Street

Newton, Massachusetts 02458

Attention:  Chief Financial Officer

Facsimile No.:  (617) 332-2261


 


If to
the Manager:


 


Reit Management &
Research LLC

400 Centre Street

Newton, Massachusetts 02458

Attention:  President 

Facsimile No.:  (617) 928-1305


 


22.           Amendments. 
This Agreement shall not be amended, changed, modified, terminated, or
discharged in whole or in part except by an instrument in writing signed by
each of the parties hereto, or by their respective successors or assigns, or
otherwise as provided herein.


 


23.           Assignment.  Neither party
may assign this Agreement or its rights hereunder or delegate its duties
hereunder without the written consent of the other party, except in the case of
an assignment by the Manager to a corporation, partnership, limited liability
company, association, trust, or other successor entity which may take over the
property and carry on the affairs of the Manager and which remains under the
control of the same persons who control the Manager.


 


24.           Successors and Assigns. 
This Agreement shall be binding upon any successors or permitted assigns
of the parties hereto as provided herein.


 


13

















 


25.           No Third Party Beneficiary.  No person or
entity other than the parties hereto and their successors and permitted assigns
is intended to be a beneficiary of this Agreement.


 


26.           Governing Law. 
The provisions of this Agreement shall be governed by and construed in
accordance with the laws of The Commonwealth of Massachusetts.


 


27.           Arbitration.


 


(a)     Any disputes, claims or controversies
between the parties (i) arising out of or relating to this Agreement or
the provision of services by the Manager pursuant to this Agreement, or (ii) brought
by or on behalf of any shareholder of the Company (which, for purposes of this Section 27,
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 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 trustee, officer, manager (including Reit Management &
Research LLC 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, the Declaration
of Trust or the Bylaws (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
modified herein.  For the avoidance of
doubt, and not as a limitation, Disputes are intended to include derivative
actions against trustees, officers or managers of the Company and class actions
by a shareholder against those individuals or entities and the Company.


 


(b)     There shall be three
arbitrators.  If there are (i) 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 and (ii) 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.  The two party-nominated arbitrators shall jointly
nominate the third and presiding arbitrator within 15 days of the nomination of
the second arbitrator.  If any arbitrator
has not been nominated within the 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. 
For the avoidance of doubt, the arbitrators appointed by the parties to
such Dispute may be affiliates or interested persons of such parties but the
third arbitrator elected by the party arbitrators or by the AAA shall be
unaffiliated with either party.


 


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(c)     The place of arbitration shall be
Boston, Massachusetts 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 Commonwealth of Massachusetts.  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 expressly
provided by this Agreement or as otherwise agreed between 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 by a shareholder of the Company, 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)     The 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.  The 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.


 


15

















 


28.           Consent to Jurisdiction
and Forum.  This Section 28 is subject
to, and shall not in any way limit the application of, Section 27;
in case of any conflict between this Section 28 and Section 27,
Section 27 shall govern. 
The exclusive jurisdiction and venue in any action brought by any party
hereto pursuant to this Agreement shall lie in any federal or state court
located in Boston, Massachusetts.  By
execution and delivery of this Agreement, each party hereto irrevocably submits
to the jurisdiction of such courts for itself and in respect of its property
with respect to such action. The parties irrevocably agree that venue would be
proper in such court, and hereby waive any objection that such court is an
improper or inconvenient forum for the resolution of such action.  The parties further agree and consent to the
service of any process required by any such court by delivery of a copy thereof
in accordance with Section 21 and that any such delivery
shall constitute valid and lawful service of process against it, without
necessity for service by any other means provided by statute or rule of
court.


 


29.           Captions. 
The captions included herein have been inserted for ease of reference
only and shall not be construed to affect the meaning, construction or effect
of this Agreement.


 


30.           Entire Agreement.  This Agreement
and the Advisory Agreement constitute the entire agreement of the parties
hereto with respect to the subject matter hereof and supersede and cancel any
pre-existing agreements with respect to such subject matter.


 


31.           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.


 


32.           Survival.  The provisions
of Sections  2 (limited to the obligation of the Company to
indemnify the Manager for matters provided thereunder), 15, 16
(limited to the obligations of the Company to keep information provided to the
Company by the Manager confidential as provided in the last proviso in such
Section), 17 (limited to the last paragraph of such Section), 18,
20, 21, 25, 26, 27, 28 and 32
of this Agreement shall survive the termination hereof.


 


33.           Advisory Agreement.  This Agreement
amends and restates the Advisory Agreement in its entirety, effective as of the
date hereof.


 


34.           Other Agreements.             The
parties hereto are also parties to an Amended and Restated Master Management
Agreement, dated as of January 1, 2006, as in effect from time to time (the
“Property Management Agreement”). 
The parties agree that this Agreement does not include or otherwise
address the rights and obligations of the parties under the Property Management
Agreement and that the Property Management Agreement provides for its own
separate rights and obligations of the parties thereto, including without
limitation separate 


 


16

















 


compensation payable by
the Company and the other Owners (as defined in the Property Management
Agreement) to the Manager thereunder for services to be provided by the Manager
pursuant to the Property Management Agreement.


 


[Signature
Page To Follow]


 


17

















 


IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be executed by their duly
authorized officers, under seal, as of the day and year first above written.


 


 


	
   

  	
  HRPT PROPERTIES TRUST

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John C. Popeo 

  
	
   

  	
   

  	
  Name: John C. Popeo 

  
	
   

  	
   

  	
  Title: Treasurer and
  Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  REIT MANAGEMENT &
  RESEARCH LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David J. Hegarty 

  
	
   

  	
   

  	
  Name: David J. Hegarty 

  
	
   

  	
   

  	
  Title: Executive Vice
  President

  



 


 


[Signature Page to
Business Management Agreement]