Document:

Exhibit 10.25

 

AMENDED AND RESTATED

SHAREHOLDERS AGREEMENT

by and among

AFFILIATES INSURANCE COMPANY,

FIVE STAR QUALITY CARE, INC.,

HOSPITALITY PROPERTIES TRUST,

HRPT PROPERTIES TRUST,

SENIOR HOUSING PROPERTIES TRUST,

TRAVELCENTERS OF AMERICA LLC

REIT MANAGEMENT & RESEARCH LLC

and

GOVERNMENT PROPERTIES INCOME TRUST

December 16, 2009

 

 

TABLE
OF CONTENTS

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  ARTICLE I

  	
   

  
	
   

  	
   

  
	
  INVESTMENT IN THE COMPANY; FORMATION AND LICENSING
  EXPENSES

  	
   

  
	
   

  	
   

  	
   

  
	
  1.1

  	
  Share Issuances to Original Shareholders

  	
  2

  
	
  1.2

  	
  Future Share Issuances

  	
  2

  
	
  1.3

  	
  Formation and Licensing Expenses

  	
  2

  
	
  1.4

  	
  Share Issuance to GOV

  	
  2

  
	
   

  	
   

  	
   

  
	
  ARTICLE II

  	
   

  
	
   

  	
   

  
	
  BOARD COMPOSITION

  	
   

  
	
   

  	
   

  	
   

  
	
  2.1

  	
  Board Composition

  	
  3

  
	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
   

  
	
   

  	
   

  
	
  TRANSFER OF SHARES;

  	
   

  
	
  PREEMPTIVE RIGHTS; CALL RIGHTS

  	
   

  
	
   

  	
   

  	
   

  
	
  3.1

  	
  Transfer of Shares; No Pledging of Shares

  	
  4

  
	
  3.2

  	
  Preemptive Rights

  	
  4

  
	
  3.3

  	
  Change of Control Call Option

  	
  7

  
	
  3.4

  	
  Permitted New Issuance of Shares

  	
  10

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV

  	
   

  
	
   

  	
   

  
	
  SPECIAL SHAREHOLDER APPROVAL REQUIREMENTS.

  	
   

  
	
   

  	
   

  	
   

  
	
  4.1

  	
  Special Shareholder Approval Requirements

  	
  10

  
	
   

  	
   

  	
   

  
	
  ARTICLE V

  	
   

  
	
   

  	
   

  
	
  OTHER COVENANTS AND AGREEMENTS

  	
   

  
	
   

  	
   

  	
   

  
	
  5.1

  	
  Organizational Documents

  	
  11

  
	
  5.2

  	
  Reports and Information Access

  	
  11

  
	
  5.3

  	
  Compliance with Laws

  	
  11

  
	
  5.4

  	
  Cooperation; Further Assurances

  	
  11

  
	
  5.5

  	
  Confidentiality

  	
  12

  
	
  5.6

  	
  Required Regulatory Approvals

  	
  12

  
	
  5.7

  	
  REIT Matters

  	
  13

  

 

 

	
  ARTICLE VI

  	
   

  
	
   

  	
   

  
	
  REPRESENTATIONS AND WARRANTIES

  	
   

  
	
   

  	
   

  	
   

  
	
  6.1

  	
  The Company

  	
  13

  
	
  6.2

  	
  The Shareholders

  	
  14

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII

  	
   

  
	
   

  	
   

  
	
  TERMINATION

  	
   

  
	
   

  	
   

  	
   

  
	
  7.1

  	
  Termination

  	
  16

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  	
   

  
	
   

  	
   

  
	
  MISCELLANEOUS

  	
   

  
	
   

  	
   

  	
   

  
	
  8.1

  	
  Notices

  	
  16

  
	
  8.2

  	
  Successors and Assigns; Third Party Beneficiaries

  	
  18

  
	
  8.3

  	
  Amendment and Waiver

  	
  18

  
	
  8.4

  	
  Counterparts

  	
  18

  
	
  8.5

  	
  Headings

  	
  19

  
	
  8.6

  	
  Governing Law

  	
  19

  
	
  8.7

  	
  Dispute Resolution

  	
  19

  
	
  8.8

  	
  Interpretation and Construction

  	
  21

  
	
  8.9

  	
  Severability

  	
  21

  
	
  8.10

  	
  Entire Agreement

  	
  21

  
	
  8.11

  	
  Non-liability
  of Trustees and Directors

  	
  22

  

 

 

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.

 

2

 

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 

 

3

 

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 

 

4

 

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 

 

5

 

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 

 

6

 

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 

 

7

 

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

 

8

 

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 OfficerExhibit 4.14

 

 

SUPPLEMENTAL INDENTURE NO. 13

 

by and between

 

HOSPITALITY PROPERTIES TRUST

 

and

 

U.S. BANK NATIONAL ASSOCIATION,

as Trustee

 

as of August 12, 2009

 

SUPPLEMENTAL TO THE INDENTURE DATED AS OF FEBRUARY 25, 1998

 

 

HOSPITALITY PROPERTIES TRUST

 

7.875% Senior Notes due 2014

 

 

 

 

This SUPPLEMENTAL INDENTURE
NO. 13 (this “Supplemental Indenture”)
made and entered into as of August 12, 2009 between HOSPITALITY PROPERTIES
TRUST, a Maryland real estate investment trust (the “Company”), and U.S. BANK NATIONAL ASSOCIATION, a national
banking association, as Trustee (the “Trustee”).

 

WITNESSETH THAT:

 

WHEREAS, the Company and the
Trustee are parties to an Indenture, dated as of February 25, 1998 (the “Indenture”), relating to the Company’s
issuance, from time to time, of various series of debt securities;

 

WHEREAS, the Company has
determined to issue debt securities known as its 7.875% Senior Notes due 2014;
and

 

WHEREAS, the Indenture provides
that certain terms and conditions for each series of debt securities issued by
the Company thereunder may be set forth in an indenture supplemental to the
Indenture;

 

NOW, THEREFORE, THIS
SUPPLEMENTAL INDENTURE WITNESSETH:

 

ARTICLE 1

 

DEFINED TERMS

 

Section 1.1                                      Terms Defined in
Indenture.  Capitalized
terms used herein and not defined herein have the meanings ascribed to such
terms in the Indenture.

 

Section 1.2                                      Supplemental
Definitions.  The following
definitions supplement, and, to the extent inconsistent with, replace the
definitions in Section 101 of the Indenture:

 

“Acquired Debt” means Debt of a Person (i) existing at
the time such Person becomes a Subsidiary or (ii) assumed in connection
with the acquisition of assets from such Person, in each case, other than Debt
incurred in connection with, or in contemplation of, such Person becoming a
Subsidiary or such acquisition.  Acquired
Debt shall be deemed to be incurred on the date of the related acquisition of
assets from any Person or the date the acquired Person becomes a Subsidiary.

 

“Additional Notes” has the meaning provided in Section 2.1(b) hereof.

 

“Adjusted Total Assets” has the meaning provided in
clause (i) of Section 3.1(a) hereof.

 

“Annual Debt Service” as of any date means the maximum amount
which is expensed in any 12-month period for interest on Debt of the Company
and its Subsidiaries.

 

“Business Day” means any day other than a Saturday or Sunday
or a day on which banking institutions in The City of New York or in the city
in which the Corporate Trust Office of the Trustee is located are required or
authorized to close.

 

 

“Capital Stock” means, with respect to any Person, any
capital stock (including preferred stock), shares, interests, participation or
other ownership interests (however designated) of such Person and any rights
(other than debt securities convertible into or exchangeable for capital
stock), warrants or options to purchase any thereof.

 

“Consolidated Income Available for Debt Service” for any
period means Earnings from Operations of the Company and its Subsidiaries plus
amounts which have been deducted, and minus amounts which have been added, for
the following (without duplication): (i) interest on Debt of the Company
and its Subsidiaries, (ii) cash reserves made by lessees as required by
the Company’s leases for periodic replacement and refurbishment of the Company’s
assets, (iii) provision for taxes of the Company and its Subsidiaries
based on income, (iv) amortization of debt discount and deferred financing
costs, (v) provisions for gains and losses on properties and property depreciation
and amortization, (vi) the effect of any noncash charge resulting from a
change in accounting principles in determining Earnings from Operations for
such period and (vii) amortization of deferred charges.

 

“Corporate Trust Office” means One Federal Street, 3rd Floor,
Boston, Massachusetts 02110, or such other address as may be designated from
time to time by the Trustee by providing written notice to the Company.

 

“Debt” of the Company or any Subsidiary means, without
duplication, any indebtedness of the Company or any Subsidiary, whether or not
contingent, in respect of (i) borrowed money or evidenced by bonds, notes,
debentures or similar instruments, (ii) indebtedness for borrowed money
secured by any Encumbrance existing on property owned by the Company or any
Subsidiary, to the extent of the lesser of (x) the amount of indebtedness
so secured and (y) the fair market value of the property subject to such
Encumbrance, (iii) the reimbursement obligations, contingent or otherwise,
in connection with any letters of credit actually issued (other than letters of
credit issued to provide credit enhancement or support with respect to other
indebtedness of the Company or any Subsidiary otherwise reflected as Debt
hereunder) or amounts representing the balance deferred and unpaid of the
purchase price of any property or services, except any such balance that
constitutes an accrued expense or trade payable, or all conditional sale
obligations or obligations under any title retention agreement, (iv) the
principal amount of all obligations of the Company or any Subsidiary with
respect to redemption, repayment or other repurchase of any Disqualified Stock,
or (v) any lease of property by the Company or any Subsidiary as lessee
which is reflected on the Company’s consolidated balance sheet as a capitalized
lease in accordance with GAAP, to the extent, in the case of items of
indebtedness under (i) through (iii) above, that any such items
(other than letters of credit) would appear as a liability on the Company’s consolidated
balance sheet in accordance with GAAP, and also includes, to the extent not
otherwise included, any obligation by the Company or any Subsidiary to be
liable for, or to pay, as obligor, guarantor or otherwise (other than for
purposes of collection in the ordinary course of business), Debt of another
Person (other than the Company or any Subsidiary) (it being understood that
Debt shall be deemed to be incurred by the Company or any Subsidiary whenever
the Company or such Subsidiary shall create, assume, guarantee or otherwise
become liable in respect thereof).

 

“Depositary” has the meaning provided in Section 2.1(d) hereof.

 

2

 

“Disqualified Stock” means, with respect to any Person, any
Capital Stock of such Person which by the terms of such Capital Stock (or by
the terms of any security into which it is convertible or for which it is
exchangeable or exercisable), upon the happening of any event or otherwise (i) matures
or is mandatorily redeemable, pursuant to a sinking fund obligation or
otherwise (other than Capital Stock which is redeemable solely in exchange for
common stock or shares), (ii) is convertible into or exchangeable or
exercisable for Debt or Disqualified Stock, or (iii) is redeemable at the
option of the Holder thereof, in whole or in part (other than Capital Stock
which is redeemable solely in exchange for common stock or shares), in each
case on or prior to the stated maturity of the Notes.

 

“Earnings from Operations” for any period means net earnings
excluding gains and losses on sales of investments, extraordinary items, gains
and losses from early extinguishment of debt and property valuation losses, as
reflected in the financial statements of the Company and its Subsidiaries for
such period, determined on a consolidated basis in accordance with GAAP.

 

“Encumbrance” means any mortgage, lien, charge, pledge or
security interest of any kind.

 

“Interest Payment Date” has the meaning provided in Section 2.1(e) hereof.

 

“Make-Whole Amount”
means, in connection with any optional
redemption or accelerated payment of any Notes prior to February 15, 2014,
the excess, if any, of (i) the aggregate present value as of the date of
such redemption or accelerated payment of each dollar of principal being
redeemed or paid and the amount of interest (exclusive of interest accrued to
the date of redemption or accelerated payment) that would have been payable in
respect of such dollar if such redemption or accelerated payment had been made
on February 15, 2014, determined by discounting, on a semiannual basis,
such principal and interest at the Reinvestment Rate (determined on the third
Business Day preceding the date such notice of redemption is given or
declaration of acceleration is made) from the respective dates on which such
principal and interest would have been payable if such redemption or
accelerated payment had been made on February 15, 2014, over (ii) the
aggregate principal amount of the Notes being redeemed or paid.  In the case of any redemption or accelerated
payment of notes on or after February 15, 2014, the Make-Whole Amount
means zero.  For purposes of this
Supplemental Indenture and the Notes, references in the Indenture to the
payment of the principal (and premium, if any) and interest on the Notes shall
be deemed to include the payment of the Make-Whole Amount, if any, due upon
redemption with respect to the Notes. 
The Make-Whole Amount shall be calculated by the Company and set forth
in an Officer’s Certificate delivered to the Trustee, and the Trustee shall be
entitled to rely on said Officer’s Certificate.

 

“Notes” means the Company’s 7.875% Senior Notes due 2014,
issued under this Supplemental Indenture and the Indenture, as amended or
supplemented from time to time.  (For the
avoidance of doubt, the term “Notes” shall include any Additional Notes so
issued.)

 

“Regular Record Date” has the meaning provided in Section 2.1(e) hereof.

 

“Reinvestment Rate” means a rate per annum equal to the sum
of 0.50% (50 one hundredths of one percent) plus the yield on treasury
securities at constant maturity under the 

 

3

 

heading
“Week Ending” published in the Statistical Release under the caption “Treasury
Constant Maturities” for the maturity (rounded to the nearest month)
corresponding to the remaining life to maturity (which, in the case of
maturities corresponding to the principal and interest due on the notes at
their maturity, shall be deemed to be February 15, 2014), as of the
payment date of the principal being redeemed or paid.  If no maturity exactly corresponds to such
maturity, yields for the two published maturities most closely corresponding to
such maturity shall be calculated pursuant to the immediately preceding
sentence and the Reinvestment Rate shall be interpolated or extrapolated from
such yields on a straight-line basis, rounding in each of such relevant periods
to the nearest month.  For purposes of
calculating the Reinvestment Rate, the most recent Statistical Release published
prior to the date of determination of the Make-Whole Amount shall be used.

 

“Secured Debt” means Debt secured by any mortgage, lien,
charge, pledge or security interest of any kind.

 

“Statistical Release” means the statistical release
designated “H.15(519)” or any successor publication which is published weekly
by the Federal Reserve System and which establishes yields on actively traded
United States government securities adjusted to constant maturities or, if such
statistical release is not published at the time of any determination under
this Supplemental Indenture, then any publicly available source of similar
market data which shall be designated by the Company.

 

“Subsidiary” means any corporation or other entity of which a
majority of (i) the voting power of the voting equity securities or (ii) the
outstanding equity interests of which are owned, directly or indirectly, by the
Company or one or more other Subsidiaries of the Company.  For the purposes of this definition, “voting
equity securities” means equity securities having voting power for the election
of directors, whether at all times or only so long as no senior class of
security has such voting power by reason of any contingency.

 

“Total Assets” as of any date means the sum of (i) the
Undepreciated Real Estate Assets and (ii) all other assets of the Company
and its Subsidiaries determined in accordance with GAAP (but excluding accounts
receivable and intangibles).

 

“Total Unencumbered Assets” means the sum of (i) those
Undepreciated Real Estate Assets not subject to an Encumbrance for borrowed
money and (ii) all other assets of the Company and its Subsidiaries not
subject to an Encumbrance for borrowed money determined in accordance with GAAP
(but excluding accounts receivable and intangibles).

 

“Undepreciated Real Estate Assets” as of any date means the
cost (original cost plus capital improvements) of, real estate assets of the
Company and its Subsidiaries on such date, before depreciation and amortization
determined on a consolidated basis in accordance with GAAP.

 

“Unsecured Debt” means Debt which is not secured by any of
the properties of the Company or any Subsidiary.

 

4

 

ARTICLE 2

 

TERMS OF THE NOTES

 

Section 2.1                                      Terms of the Notes.  Pursuant to Section 301 of the
Indenture, the Notes shall have the following terms and conditions:

 

(a)                                  Title.  The Notes shall be Registered Securities
under the Indenture and shall be known as the Company’s “7.875% Senior Notes
due 2014.”

 

(b)                                 Aggregate Principal
Amount.  The aggregate principal amount
of Notes to be authenticated and delivered under this Supplemental Indenture
shall initially be limited to $300,000,000, except as otherwise permitted by
the provisions of the Indenture; provided that the Company may from time to time,
without the consent of the Holders of the Notes, increase the principal amount
of the Notes by issuing additional Securities in the future (the “Additional Notes”)
having the same terms and ranking equally and ratably with the Notes in all
respects and with the same CUSIP number as the Notes, except for the difference
in the issue price and interest accrued prior to the issue date of such
Additional Notes, provided that such Additional Notes constitute part of the
same issue as the Notes for U.S. federal income tax purposes.  Any Additional Notes will be treated as a
single series with the Notes under the Indenture and shall have the same terms
as to status, redemption and otherwise as the Notes, and references herein to
the Notes shall include any Additional Notes.

 

(c)                                  Form of Notes.  The Notes (together with the Trustee’s
certificate of authentication) shall be substantially in the form of Exhibit A
hereto, which is hereby incorporated in and made a part of this Supplemental
Indenture.  Any of the Notes may have such letters, numbers or
other marks of identification and such notations, legends, endorsements or
changes as the officers executing the same may approve (execution  thereof to be conclusive evidence of such
approval) and as are not inconsistent with the provisions of the Indenture, or
as may be required by the Depositary or as may be required to comply with any
applicable law or with any rule or regulation made pursuant thereto or
with any rule or regulation of any securities exchange or automated
quotation system on which the Notes may be listed, or to conform to usage, or
to indicate any special limitations or restrictions to which any particular
Notes are subject.

 

(d)                                 Registered
Securities in Book Entry Form.   The Notes shall be issuable in the form of
one or more global Securities registered in the name of The Depository Trust
Company’s nominee, and shall be deposited with, or on behalf of, The Depository
Trust Company, New York, New York (including any successor depositary appointed
hereunder, the “Depositary”).  The Notes may be surrendered for registration
of transfer at the office or agency of the Company (including the Corporate
Trust Office of the Trustee) maintained for such purpose, or at any other
office or agency maintained by the Company for such purpose.

 

So
long as the Depositary or its nominee is the registered owner of a Global Note,
the Depositary or its nominee, as the case may be, will be considered the sole
Holder of the Notes represented by such Global Note for all purposes under the
Indenture and this Supplemental Indenture, and the beneficial owners of the
Notes will be entitled only to those 

 

5

 

rights
and benefits afforded to them in accordance with the Depositary’s regular
operating procedures.  Except as provided
below, owners of beneficial interests in a Global Note will not be entitled to
have Notes registered in their names, will not receive or be entitled to
receive physical delivery of Notes in certificated form and will not be
considered the registered owners or Holders thereof under the Indenture or this
Supplemental Indenture.

 

If (i) the
Depositary is at any time unwilling or unable to continue as depository or if
at any time the Depositary ceases to be a clearing agency registered under the
Exchange Act and a successor depository is not appointed by the Company within
90 days, (ii) an Event of Default relating to the Notes has occurred and
is continuing and the beneficial owners representing a majority in principal
amount of the Notes advise the Depository to cease acting as depository for the
Notes, or (iii) the Company, in its sole discretion, determines at any
time that the Notes shall no longer be represented by a Global Note, the
Company will in accordance with the Indenture issue individual Notes in
certificated form of the same series and like tenor and in the applicable
principal amount in exchange for the Notes represented by the Global Note.  In any such instance, an owner of a
beneficial interest in a Global Note will be entitled to physical delivery of
individual Notes in certificated form of the same series and like tenor, equal
in principal amount to such beneficial interest and to have the Notes in
certificated form registered in its name. 
Notes so issued in certificated form will be issued in denominations of
$1,000 or any integral multiple thereof and will be issued in registered form
only, without coupons.

 

(e)                                  Interest and
Interest Rate.  The Notes will
bear interest at a rate of 7.875% per annum, from August 12, 2009 (or, in
the case of Additional Notes, as provided in Section 2.1(b) above),
or from the immediately preceding Interest Payment Date to which interest has
been paid or duly provided for, payable semi-annually in arrears on February 15
and August 15 of each year, commencing February 15, 2010, or if such
day is not a Business Day, on the next succeeding Business Day (each of which
shall be an “Interest Payment Date”),
to the Persons in whose names the Notes are registered in the Security Register
at the close of business on the day falling 14 calendar days immediately
preceding the applicable Interest Payment Date (whether or not a Business Day),
as the case may be (each, a “Regular Record
Date”).

 

(f)                                    Principal
Repayment; Currency.  The stated
maturity of the Notes is August 15, 2014; provided, however, the Notes may
be earlier redeemed at the option of the Company as provided in paragraph (g) below.  The principal of each Note payable on its
maturity date shall be paid against presentation and surrender thereof at the
Corporate Trust Office of the Trustee, in such coin or currency of the United
States of America as at the time of payment is legal tender for the payment of
public or private debts.  The Company
will not pay Additional Amounts (as defined in the Indenture) on the Notes.

 

(g)                                 Redemption at the
Option of the Company. The Notes will be subject to redemption at any time at
the option of the Company, in whole or in part, upon not less than 30 nor more
than 60 days’ notice to each Holder of Notes to be redeemed at its address
appearing in the Security Register, at a price equal to the sum of (i) the
principal amount of the Notes being redeemed, plus accrued and unpaid interest
to but excluding the applicable Redemption Date, plus (ii) the Make-Whole
Amount, if any (it being understood that if the notes are redeemed on or after February 15, 2014, the Make-Whole Amount equals
zero).

 

6

 

(h)                                 Notices.  All notices and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
mailed or transmitted by any standard form of telecommunication. Notices to the
Company shall be directed to it at 400 Centre Street, Newton, Massachusetts
02458, Attention:  President; notices to
the Trustee shall be directed to it at One Federal Street, 3rd Floor, Boston,
Massachusetts 02110, Attention: Corporate Trust Department, Re: Hospitality
Properties Trust 7.875% Senior Notes due 2014, or as to either party, at such
other address as shall be designated by such party in a written notice to the
other party.

 

(i)                                     Global Note Legend.  Each Global Note shall bear the following
legend on the face thereto and any other appropriate legends specified in an
Officers’ Certificate:

 

UNLESS
THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION (“DTC”),
TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

UNLESS AND UNTIL THIS
NOTE IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN CERTIFICATED FORM, THIS
NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY DTC TO A NOMINEE THEREOF
OR BY A NOMINEE THEREOF TO DTC OR ANOTHER NOMINEE OF DTC OR BY DTC OR ANY SUCH
NOMINEE TO A SUCCESSOR OF DTC OR A NOMINEE OF SUCH SUCCESSOR.

 

ARTICLE 3

 

ADDITIONAL COVENANTS

 

Section 3.1                                      Additional Covenants of the
Company.  In addition to the covenants of
the Company set forth in Article Ten of the Indenture, for the benefit of
the Holders of the Notes:

 

(a)                                  Limitations on
Incurrence of Debt.

 

(i)                                     The Company will
not, and will not permit any Subsidiary to, incur any Debt if, immediately
after giving effect to the incurrence of such additional Debt and the
application of the proceeds thereof, the aggregate principal amount of all
outstanding Debt of the Company and its Subsidiaries on a consolidated basis determined
in accordance with GAAP is greater than 60% of the sum (“Adjusted Total Assets”) of (without
duplication) (A) the Total Assets of the Company and its Subsidiaries as
of the 

 

7

 

end of the calendar quarter covered in the Company’s Annual Report on Form 10-K,
or the Quarterly Report on Form 10-Q, as the case may be, most recently
filed with the Securities and Exchange Commission (or, if such filing is not
permitted under the Securities Exchange Act of 1934, as amended, with the
Trustee) prior to the incurrence of such additional Debt and (B) the
purchase price of any real estate assets or mortgages receivable acquired, and
the amount of any securities offering proceeds received (to the extent that such
proceeds were not used to acquire real estate assets or mortgages receivable or
used to reduce Debt), by the Company or any Subsidiary since the end of such
calendar quarter, including those proceeds obtained in connection with the
incurrence of such additional Debt.

 

(ii)                                  In addition to the
foregoing limitation on the incurrence of Debt, the Company will not, and will
not permit any Subsidiary to, incur any Secured Debt if, immediately after
giving effect to the incurrence of such additional Secured Debt and the
application of the proceeds thereof, the aggregate principal amount of all
outstanding Secured Debt of the Company and its Subsidiaries on a consolidated
basis is greater than 40% of Adjusted Total Assets.

 

(iii)                               In addition to the
foregoing limitations on the incurrence of Debt, the Company will not, and will
not permit any Subsidiary to, incur any Debt if the ratio of Consolidated
Income Available for Debt Service to the Annual Debt Service for the four
consecutive fiscal quarters most recently ended prior to the date on which such
additional Debt is to be incurred shall have been less than 1.5 to 1.0, on a
pro forma basis after giving effect thereto and to the application of the
proceeds therefrom, and calculated on the assumption that (A) such Debt
and any other Debt incurred by the Company and its Subsidiaries since the first
day of such four-quarter period and the application of the proceeds therefrom,
including to refinance other Debt, had occurred at the beginning of such
period; (B) the repayment or retirement of any other Debt by the Company
and its Subsidiaries since the first date of such four-quarter period had been
repaid or retired at the beginning of such period (except that, in making such
computation, the amount of Debt under any revolving credit facility shall be
computed based upon the average daily balance of such Debt during such period);
(C) in the case of Acquired Debt or Debt incurred in connection with any
acquisition since the first day of such four-quarter period, the related
acquisition had occurred as of the first day of such period with appropriate
adjustments with respect to such acquisition being included in such pro forma
calculation; and (D) in the case of any acquisition or disposition by the
Company or its Subsidiaries of any asset or group of assets since the first day
of such four-quarter period, whether by merger, stock purchase or sale, or
asset purchase or sale, such acquisition or disposition or any related
repayment of Debt had occurred as of the first day of such period with the
appropriate adjustments with respect to such acquisition or disposition being
included in such pro forma calculation. If the Debt giving rise to the need to
make the foregoing calculation or any other Debt incurred after the first day of
the relevant four-quarter period bears interest at a floating rate then, for
purposes of calculating the Annual Debt Service, the interest rate on such Debt
shall be computed on a pro forma basis as if the average interest rate which
would have been in effect during the entire such four-quarter period had been
the applicable rate for the entire such period.

 

8

 

(b)                                 Maintenance of
Total Unencumbered Assets.  The
Company and its Subsidiaries will maintain at all times Total Unencumbered
Assets of not less than 150% of the aggregate outstanding principal amount of
the Unsecured Debt of the Company and its Subsidiaries on a consolidated basis.

 

ARTICLE 4

 

OTHER PROVISIONS

 

Section 4.1                                      Additional Event of
Default.  For purposes of this
Supplemental Indenture and the Notes, in addition to the Events of Default set
forth in Section 501 of the Indenture, it shall also constitute an “Event
of Default” if a default under any bond, debenture, note or other evidence of
indebtedness of the Company (including a default with respect to any other
series of securities), or under any mortgage, indenture or other instrument of
the Company under which there may be issued or by which there may be secured or
evidenced any indebtedness for money borrowed by the Company (or by any
Subsidiary, the repayment of which the Company has guaranteed or for which the
Company is directly responsible or liable as obligor or guarantor) having an
aggregate principal amount outstanding of at least $20,000,000, whether such
indebtedness now exists or shall hereafter be incurred or created, which
default shall have resulted in such indebtedness becoming or being declared due
and payable prior to the date on which it would otherwise have become due and payable,
without such indebtedness having been discharged or such acceleration having
been rescinded or annulled within a period of ten days after there shall have
been given, by registered or certified mail, to the Company by the Trustee or
to the Company and the Trustee by the Holders of at least 25% in principal
amount of the outstanding Notes, a written notice specifying such default and
requiring the Company to cause such indebtedness to be discharged or cause such
acceleration to be rescinded or annulled and stating that such notice is a “Notice
of Default” hereunder.

 

Section 4.2                                      Make-Whole Amount
Upon Acceleration.  Notwithstanding
any provisions to the contrary in the Indenture, upon any acceleration of the
Notes under Section 502 of the Indenture, the amount immediately due and
payable in respect of the Notes shall equal the Outstanding principal amount
thereof, plus accrued and unpaid interest thereon, plus, if such acceleration
occurs prior to February 15, 2014, the Make-Whole Amount.

 

Section 4.3                                      Applicability of
Discharge, Defeasance and Covenant Defeasance Provisions.  The Discharge, Defeasance and Covenant
Defeasance provisions in Article Fourteen of the Indenture will apply to
the Notes.

 

ARTICLE 5

 

EFFECTIVENESS

 

This Supplemental Indenture shall
be effective for all purposes as of the date and time this Supplemental
Indenture has been executed and delivered by the Company and the Trustee in
accordance with Article Nine of the Indenture.  As supplemented hereby, the Indenture is
hereby confirmed as being in full force and effect.

 

9

 

ARTICLE 6

 

MISCELLANEOUS

 

Section 6.1                                      Separability.  In the event any provision of this
Supplemental Indenture shall be held invalid or unenforceable by any court of
competent jurisdiction, such holding shall not invalidate or render
unenforceable any other provision hereof or any provision of the Indenture.

 

Section 6.2                                      Construction of
Terms.  To the extent that any terms of
this Supplemental Indenture or the Notes are inconsistent with the terms of the
Indenture, the terms of this Supplemental Indenture or the Notes shall govern
and supersede such inconsistent terms.

 

Section 6.3                                      Effect of Headings. The Section headings herein are
for convenience only and shall not affect the construction hereof.

 

Section 6.4                                      Governing Law.  This Supplemental Indenture shall be governed
by and construed in accordance with the laws of The Commonwealth of
Massachusetts.

 

Section 6.5                                      Counterparts.  This Supplemental Indenture may be executed
in several counterparts, each of which shall be an original and all of which
shall constitute but one and the same instrument.

 

[Signature Page Follows]

 

10

 

IN WITNESS WHEREOF, the Company
and the Trustee have caused this Supplemental Indenture to be executed as an
instrument under seal in their respective corporate names as of the date first
above written.

 

	
   

  	
  HOSPITALITY
  PROPERTIES TRUST

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  John G. Murray 

  
	
   

  	
          Name:
  John G. Murray

  
	
   

  	
          Title: President
  and Chief Operating Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  U.S.
  BANK NATIONAL ASSOCIATION, as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Sam Soltani 

  
	
   

  	
          Name:
  Sam Soltani 

  
	
   

  	
          Title:
   Officer

  

 

[Signature Page to Supplemental Indenture No. 13]

 

 

EXHIBIT A

 

[Face of Note]

 

[Include only for Global Notes]

 

[UNLESS
THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION (“DTC”),
TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

UNLESS AND UNTIL THIS
NOTE IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN CERTIFICATED FORM, THIS
NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY DTC TO A NOMINEE THEREOF OR
BY A NOMINEE THEREOF TO DTC OR ANOTHER NOMINEE OF DTC OR BY DTC OR ANY SUCH
NOMINEE TO A SUCCESSOR OF DTC OR A NOMINEE OF SUCH SUCCESSOR.]

 

7.875% Senior Note due 2014

 

No.                                                                                                                                                                              $

 

HOSPITALITY PROPERTIES TRUST

 

promises
to pay to
                                                                              
or registered assigns, the
principal sum of
                                            
($              )
on August 15, 2014, subject to
the terms set forth on the reverse of this Note and the terms of the Indenture
referred to therein.

 

Interest
Payment Dates:  Each February 15 and
August 15 (or if such day is not a Business Day, the next succeeding
Business Day), commencing February 15, 2010.

 

A-1

 

Record Dates:  The day falling 14
calendar days prior to any Interest Payment Date.

 

CUSIP No:  44106M AP7

ISIN No: US44106MAP77

 

	
   

  	
  HOSPITALITY PROPERTIES TRUST

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
         Name:  

  
	
   

  	
         Title:

  

 

CERTIFICATE
OF AUTHENTICATION

 

Dated:

 

This
is one of the Notes referred to in the within-mentioned Indenture:

 

U.S.
BANK NATIONAL ASSOCIATION, as Trustee

 

 

	
  By:

  	
   

  	
   

  
	
         Authorized
  Officer

  

 

A-2

 

[THE FOLLOWING CONSTITUTES THE REVERSE OF THE SECURITY]

 

HOSPITALITY PROPERTIES TRUST

 

7.875% Senior Note due 2014

 

Capitalized terms used herein have
the meanings assigned to them in the Indenture (as defined below) unless
otherwise indicated.

 

1.                                       Interest.  Hospitality Properties Trust, a Maryland real
estate investment trust (the “Company”),
promises to pay interest on the principal amount of this Note at the rate and
in the manner specified below.

 

The Company shall pay in cash
interest on the principal amount of this Note at the rate per annum of
7.875%.  The Company will pay interest
semi-annually in arrears on February 15 and August 15 of each year,
beginning on February 15, 2010, or if any such day is not a Business Day
(as defined in the Indenture), on the next succeeding Business Day (each an “Interest Payment Date”), to Holders of
record on the day falling 14 calendar days immediately preceding such Interest
Payment Date (whether or not a Business Day).

 

Interest will be computed on the
basis of a 360-day year consisting of twelve 30-day months.  Interest shall accrue from the most recent
date to which interest on the Notes has been paid or, if no interest has been
paid, from August 12, 2009.

 

2.                                       Method of Payment.  The Company will pay interest on the Notes
(except defaulted interest) to the Persons who are registered Holders of Notes
at the close of business on the record date next preceding the Interest Payment
Date, even if such Notes are canceled after such record date and on or before
such Interest Payment Date.  The Company
will pay principal and interest in money of the United States that at the time
of payment is legal tender for payment of public and private debts.  The Company, however, may pay principal,
premium, if any, and interest by check payable in such money.  It may mail an interest check to a Holder’s
registered address.

 

3.                                       Indenture.  The Company issued the Notes under an Indenture
dated as of February 25, 1998 and Supplemental Indenture No. 13 dated
as of August 12, 2009 (collectively, the “Indenture”), between the Company
and the Trustee.  The terms of the Notes
include those stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939, as in effect on the date of the
Indenture and Holders of the Notes are referred to the Indenture and such Act
for a statement of such terms.  The terms
of the Indenture shall govern any inconsistencies between the Indenture and the
Notes.  The Notes are senior unsecured
general obligations of the Company initially issued in an aggregate principal
amount of $300,000,000.

 

4.                                       Optional Redemption.  The Notes will be subject to redemption at
any time at the option of the Company, in whole or in part, upon not less than
30 nor more than 60 days’ notice, at a redemption price equal to the sum of (i) the
principal amount of the Notes being redeemed, 

 

A-3

 

plus accrued and unpaid interest to but excluding
the applicable Redemption Date and (ii) the Make-Whole Amount, if any.

 

As used herein the term “Make-Whole Amount” means, in
connection with any optional redemption or accelerated payment of any Notes prior
to February 15 , 2014, the
excess, if any, of (i) the aggregate
present value as of the date of such redemption or accelerated payment of each
dollar of principal being redeemed or paid and the amount of interest
(exclusive of interest accrued to the date of redemption or accelerated
payment) that would have been payable in respect of such dollar if such
redemption or accelerated payment had been made on February 15, 2014,
determined by discounting, on a semiannual basis, such principal and interest
at the Reinvestment Rate (determined on the third Business Day preceding the
date such notice of redemption is given or declaration of acceleration is made)
from the respective dates on which such principal and interest would have been
payable if such redemption or accelerated payment had been made on February 15, 2014, over (ii) the aggregate principal
amount of the Notes being redeemed or paid. 
In the case of any redemption or accelerated payment of notes on or
after February 15, 2014, the Make-Whole Amount means zero.  For purposes of the Indenture and the Notes,
references in the Indenture to the payment of the principal (and premium, if
any) and interest on the Notes shall be deemed to include the payment of the
Make-Whole Amount, if any, due upon redemption with respect to the Notes.  The Make-Whole Amount shall be calculated by
the Company and set forth in an Officer’s Certificate delivered to the Trustee,
and the Trustee shall be entitled to rely on said Officer’s Certificate.

 

As used herein the term “Reinvestment
Rate” means a rate per annum equal to the sum of 0.50% (50 one hundredths of
one percent) plus the yield on treasury securities at constant maturity under
the heading “Week Ending” published in the Statistical Release (as defined
herein) under the caption “Treasury Constant Maturities” for the maturity
(rounded to the nearest month) corresponding to the remaining life to maturity
(which, in the case of maturities corresponding to the principal and interest
due on the Notes at their maturity, shall be deemed to be February 15, 2014), as of the payment date of the principal being redeemed or
paid.  If no maturity exactly corresponds
to such maturity, yields for the two published maturities most closely
corresponding to such maturity shall be calculated pursuant to the immediately
preceding sentence and the Reinvestment Rate shall be interpolated or
extrapolated from such yields on a straight-line basis, rounding in each of
such relevant periods to the nearest month. 
For purposes of calculating the Reinvestment Rate, the most recent
Statistical Release published prior to the date of determination of the
Make-Whole Amount shall be used.

 

As used herein the term “Statistical
Release” means the statistical release designated “H.15(519)” or any successor
publication which is published weekly by the Federal Reserve System and which
establishes yields on actively traded United States government securities
adjusted to constant maturities or, if such statistical release is not
published at the time of any determination under the Indenture, then any
publicly available source of similar market data which shall be designated by
the Company.

 

5.                                       Mandatory
Redemption.  The Company
shall not be required to make sinking fund or redemption payments with respect
to the Notes.

 

A-4

 

6.                                       Notice of
Redemption.  Notice of
redemption shall be mailed at least 30 days but not more than 60 days before
the Redemption Date to each Holder of Notes to be redeemed at its registered
address.  Notes may be redeemed in part
but only in whole multiples of $1,000, unless all of the Notes held by a Holder
are to be redeemed.  On and after the
Redemption Date, interest ceases to accrue on Notes or portions of them called
for redemption.

 

7.                                       Denominations,
Transfer, Exchange.  The Notes are
in registered form without coupons in denominations of $1,000 and integral
multiples of $1,000 in excess thereof. 
The transfer of Notes may be registered and Notes may be exchanged as
provided in the Indenture.  The Security
Registrar and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay any taxes and fees
required by law or permitted by the Indenture. 
The Security Registrar need not exchange or register the transfer of any
Note or portion of a Note selected for redemption.  Also, it need not exchange or register the
transfer of any Notes for a period of 15 days before the mailing of a notice of
redemption of Notes, or during the period between a record date and the
corresponding Interest Payment Date.

 

8.                                       Defaults and
Remedies.  In case an
Event of Default (as defined in the Indenture) with respect to the Notes shall
have occurred and be continuing, the principal hereof may be declared, and upon
such declaration shall become, due and payable, in the manner, with the effect
and subject to the provisions provided in the Indenture.

 

9.                                       Actions of Holders.  The Indenture contains provisions permitting
the Holders of not less than a majority of the aggregate principal amount of
the outstanding Notes, subject to certain exceptions as provided in the
Indenture, on behalf of the Holders of all such Notes at a meeting duly called
and held as provided in the Indenture, to make, give or take any request,
demand, authorization, direction, notice, consent, waiver or other action
provided in the Indenture to be made, given or taken by the Holders of the
Notes, including without limitation, waiving (a) compliance by the Company
with certain provisions of the Indenture, and (b) certain past defaults
under the Indenture and their consequences. 
Any resolution passed or decision taken at any meeting of the Holders of
the Notes in accordance with the provisions of the Indenture shall be conclusive
and binding upon such Holders and upon all future Holders of this Note and
other Notes issued upon the registration of transfer hereof or in exchange
heretofore or in lieu hereof.

 

10.                                 Persons Deemed
Owners.  The Company, the Trustee, and
any agent of the Company or the Trustee may deem and treat the Person in whose
name this Note is registered on the Security Register as its absolute owner for
all purposes.

 

11.                                 Authentication.  This Note shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating
agent.

 

12.                                 Governing Law.  THE INTERNAL LAW OF THE COMMONWEALTH OF
MASSACHUSETTS SHALL GOVERN AND BE USED TO CONSTRUE THE INDENTURE AND THE NOTES.

 

13.                                 No Personal
Liability.  THE DECLARATION
OF TRUST OF THE COMPANY, AMENDED AND RESTATED ON AUGUST 21, 1995, A COPY OF
WHICH, TOGETHER 

 

A-5

 

WITH ALL AMENDMENTS AND SUPPLEMENTS THERETO (THE “DECLARATION”),
IS DULY FILED IN THE OFFICE OF THE STATE DEPARTMENT OF ASSESSMENTS AND TAXATION
OF MARYLAND, PROVIDES THAT THE NAME “HOSPITALITY PROPERTIES TRUST” REFERS TO
THE TRUSTEES UNDER THE DECLARATION OF TRUST, AS SO AMENDED AND SUPPLEMENTED,
COLLECTIVELY AS TRUSTEES, BUT NOT INDIVIDUALLY OR PERSONALLY, AND THAT NO
TRUSTEE, OFFICER, 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.

 

The Company will furnish to any
Holder upon written request and without charge a copy of the Indenture.  Requests may be made to:

 

Hospitality
Properties Trust

400
Centre Street

Newton,
MA 02458

Telecopier
No.:  (617) 964-8389

Attention:
President

 

or such other address as
the Company may specify pursuant to the Indenture.

 

A-6

 

ASSIGNMENT FORM

 

To assign this Note, fill in the form below:

 

[I] [We] assign
and transfer this Note to
                                                                                    
                                                                    
[Print or type assignee’s name, address and zip code]
                                                                    
[Insert assignee’s soc. sec. or tax I.D. no.]
and irrevocably appoint                                                                                                                  
to transfer this Note on the books of the Company.  The agent may substitute another to act for
him.

 

	
  Date:

  	
   

  	
   

  	
   

  

 

Signature Guaranteed

 

	
   

  	
   

  	
   

  
	
  NOTICE:
  Signature must be guaranteed by an eligible Guarantor Institution (banks,
  stockbrokers, savings and loan associations and credit unions) with
  membership in an approved signature guarantee medallion program pursuant to
  Securities and Exchange Commission Rule 17Ad-15.

  	
   

  	
  NOTICE: The
  signature to this Assignment must correspond with the name as written upon
  the face of the within Note in every particular, without alteration or
  enlargement or any change whatever.

  

 

A-7

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