Document:

Exhibit 10.4

 

PROPERTY MANAGEMENT AGREEMENT

 

THIS
PROPERTY MANAGEMENT AGREEMENT (this “Agreement”) is made and entered into as of
[     ·     ] [·], 2009, by and among Reit Management &
Research LLC, a Delaware limited liability company (“Managing
Agent”), and Government Properties Income Trust, a Maryland real
estate investment trust (the “Company”), on behalf of itself and those
of its subsidiaries as may from time to time own properties subject to this
Agreement (each, an “Owner” and, “collectively,
“Owners”).

 

W I T N E S S E T H :

 

WHEREAS, Owners are
the owners of various properties that are currently majority leased to
government tenants and may, in the future, acquire additional properties which,
unless otherwise expressly agreed, shall automatically become subject to this
Agreement without amendment hereof, unless otherwise agreed by the Company and
Managing Agent (collectively, the “Managed Premises”);

 

WHEREAS, Managing Agent is a company that provides property
management and administrative services;

 

WHEREAS, Owners wishes to engage Managing Agent to provide
certain property management and administrative services as hereinafter
provided;

 

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

 

1.             Engagement.  Subject to the terms and conditions
hereinafter set forth, Owners hereby engage Managing Agent to provide the
property management and administrative services with respect to the Managed
Premises contemplated by this Agreement. 
Managing Agent hereby accepts such engagement as managing agent and
agrees to devote such time, attention and effort as may be appropriate to
operate and manage the Managed Premises in a diligent, orderly and efficient
manner.  Managing Agent may, with Owners’
consent, subcontract out some or all of its obligations hereunder to third
party managers.

 

Notwithstanding anything to the contrary set forth in this Agreement,
the services to be provided by Managing Agent hereunder shall exclude all services
(including, without limitation, 

 

 

any garage management or cafeteria management
services) whose performance by a manager to any Owner could give rise to an
Owner’s receipt of “impermissible tenant service income” as defined in §856(d)(7) of
the Internal Revenue Code of 1986 (as amended or superseded hereafter) or could
in any other way jeopardize an Owner’s federal or state tax qualification as a
real estate investment trust.  Managing
Agent shall not perform any such service and if, in the event Managing Agent
shall inadvertently perform any such service, no compensation therefor shall be
paid or payable hereunder.

 

2.             General Parameters.  Any or all services may be performed or goods
purchased by Managing Agent under arrangements jointly with or for other
properties owned or managed by Managing Agent and the costs shall be reasonably
and fairly apportioned.  Managing Agent
may employ personnel who are assigned to work exclusively at the Managed
Premises or partly at the Managed Premises and other buildings owned and/or
managed by Managing Agent.  Wages,
benefits and other related costs of centralized accounting personnel and
employees employed by Managing Agent and assigned to work exclusively or partly
at the Managed Premises shall be reasonably and fairly apportioned and
reimbursed, pro rata, by Owners in addition to the Fee and Construction
Supervision Fee (each as defined in Section 6).

 

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

 

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

 

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

 

(c)     To monitor the Managed Premises as would be done by a prudent
owner, including by making contracts for and supervising any repairs and/or
alterations to the Managed Premises, including tenant improvements and
decoration of rental space, as may be approved by the applicable Owner.

 

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(d)     For Owners’ account and at its expense, to hire, supervise
and discharge employees or third party contractors, hired with Owners’ consent,
as required to maintain in good order and repair the Managed Premises and their
operating systems.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

(p)     To enter into contracts for utilities (including, without
limitation, water, fuel, electricity, heating, air conditioning, lighting and
telephone) and for building services (including, without limitation, cleaning
of windows, common areas and tenant space, ash, rubbish and garbage hauling,
snow plowing, landscaping, carpet cleaning and vermin extermination), and for
other services as are appropriate to first class office space or such other
types of properties as may be included in the Managed Premises.

 

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

 

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

 

(s)     To take such action with respect to the Managed Premises,
generally consistent with the provisions of this Agreement, as would be done by
a prudent owner.

 

(t)      To, from time to time, or at any time requested by the Board
of Trustees of the Company (the “Trustees”), make reports of its performance
of the foregoing services to the Company.

 

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

 

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contemplated in Section 2,
on behalf of Owners as are necessary in the performance of those duties.

 

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

 

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

 

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

 

6.             Compensation.

 

(a)     In consideration of the services to be rendered by Managing
Agent hereunder, Owners agree to pay and Managing Agent agrees to accept as its
sole compensation (i) a management fee (the “Fee”)
equal to three percent (3%) of the gross collected rents actually received by
Owners from the Managed Premises, such gross rents to include all fixed rents,
percentage rents, additional rents, operating expense and tax escalations, and
any other charges paid to Owners in connection with occupancy of the Managed
Premises, but excluding any amounts collected from tenants to reimburse Owners
for the cost of capital improvements or for expenses incurred in curing any
tenant default or in enforcing any remedy against any tenant; and (ii) a
construction supervision fee (the “Construction
Supervision Fee”) in connection with all interior and exterior
construction renovation or repair activities at the Managed Premises,
including, without limitation, all tenant and capital improvements in, on or
about the Managed Premises, undertaken during the term of this Agreement, other
than ordinary maintenance and repair performed by maintenance staff, equal to
five percent (5%) of the cost of such construction which shall include the
costs of all related professional services and the cost of general conditions.

 

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

 

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

 

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

 

(e)     Except as set forth in Section 2 of this
Agreement, Managing Agent shall be entitled to no other additional compensation
or reimbursement, whether in the form of commission, bonus or the like for its
services under this Agreement.  Except as
otherwise specifically provided herein with respect to payment by Owners of
legal fees, accounting fees, salaries, wages, fees and charges of parties hired
by Managing Agent on behalf of Owners to perform operating and maintenance
functions in the Managed Premises, and the like, if Managing Agent hires third
parties to perform services required to be performed hereunder by Managing
Agent without additional charge to Owners, Managing Agent shall (except to the
extent the same are reasonably attributable to an emergency at the Managed
Premises) be responsible for the charges of such third parties.  Managing Agent shall not, however, hire any
third party without Owners’ prior written consent.

 

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

 

8.             Term of Agreement.  This Agreement shall continue in force and
effect until December 31, 2010, and is renewable annually thereafter by
the Company, on behalf of itself and the Owners, upon such terms and conditions
as may be approved by a majority of the Independent Trustees as defined in the
Company’s Bylaws, as amended as of the date hereof  (the “Independent Trustees”) serving
on the Compensation Committee of the Trustees.

 

Notwithstanding any other
provision of this Agreement to the contrary, this Agreement, or any extension
thereof, may be terminated (a) by either the Company, on behalf of itself
and the Owners, or Managing Agent  upon
sixty (60) days’ written notice to the other party, which termination, if by
the Company, must be approved by a majority vote of the Independent Trustees
serving on the Compensation Committee of the Trustees, or if by Managing Agent,
must be approved by a majority vote of the directors of Managing Agent; and (b) by
Managing Agent upon five (5) business days written notice to the Company
if there is a Change of Control.

 

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For
purposes of this Agreement, a “Change of Control” shall mean (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 8,
having the meaning provided 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 Company’s
outstanding common shares of beneficial interest or other voting interests of
the Company, including voting proxies for such shares, or the power to direct
the management and policies of the Company, directly or indirectly (excluding,
with respect to the Company, Managing Agent and its affiliates) and persons or
entities that beneficially own 9.8% or more of the Company’s outstanding common
shares of beneficial interest as of immediately prior to the execution and
delivery of this Agreement by the parties hereto; (b) the merger or
consolidation of the Company with or into any other entity (other than the
merger or consolidation of any entity into the Company that does not result in
a Change in Control of the Company under clauses (a), (c), or (d) 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 Company and its subsidiaries taken
as a whole; provided  however, that, with respect to the Company,
the acquisition of Transferred Assets as defined in the Business. Management
Agreement (defined in Section 26 hereof) by the Company or any of its
subsidiaries shall not constitute a Change of Control pursuant to this
clause(c); or (d) the cessation, for any reason, of the individuals who at
the beginning of any 36 consecutive month period constituted the Trustees
(together with any new trustees whose election by the Trustees or whose
nomination for election by the shareholders of the Company was approved by a
vote of a majority of the trustees then still in office who were either
trustees at the beginning of any such period or whose election or nomination
for election was previously so approved) to constitute a majority of the
Trustees then in office.

 

Section 9 hereof shall
govern the rights, liabilities and obligations of the parties upon termination
of this Agreement; and, except as provided in Section 9, such
termination shall be without further liability of either party to the other,
other than for breach or violation of this Agreement prior to termination..

 

9.             Termination or Expiration.  Upon termination or expiration of this
Agreement with respect to any of the Managed Premises for any reason
whatsoever, Managing Agent shall as soon as practicable turn over to Owners all
books, papers, funds, records, keys and other items relating to the management
and operation of such Managed Premises, including, without limitation, all
leases in the possession of Managing Agent and shall render to Owners a final
accounting with respect thereto through the date of termination.  Owners shall be obligated to pay all
compensation for services rendered by Managing Agent hereunder prior and up to
the effective time of such termination, including, without limitation, any Fees
and Construction Supervision Fees, and shall pay and reimburse to Managing
Agent all expenses and costs incurred by Managing Agent prior and up to the
effective time of such termination which are otherwise payable or reimbursable
to Managing Agent pursuant to the terms of this Agreement.  The amount of such fees paid as compensation
pursuant to the foregoing sentence shall be subject to adjustment in accordance
with the annual reconciliation contemplated by Section 6(b) and
consistent with past practices in performing such reconciliation.

 

10.           Fidelity Bond.  Owners, at Owners’ expense, may require that
employees of Managing Agent who handle or are responsible for Owners’ money to
be bonded by a fidelity bond in an amount sufficient in Owners’ determination
to cover any loss which may occur in the 

 

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management and operation of
the Managed Premises or that Managing Agent obtain a fiduciary policy of
insurance.

 

11.           Limit on Responsibility;
Indemnification and Insurance.

 

(a)     Managing Agent assumes no responsibility other than to render
the services described herein in good faith and shall not be responsible for
any action of the Trustees in following or declining to follow any advice or
recommendation of Managing Agent.

 

(b)     Owners agree to defend, indemnify and hold harmless Managing
Agent from and against all costs, claims, expenses and liabilities (including
reasonable attorneys’ fees) arising out of Managing Agent’s performance of its
duties in accordance with this Agreement including, without limitation, injury
or damage to persons or property occurring in, on or about the Managed Premises
and violations or alleged violations of any law, ordinance, regulation or order
of any governmental authority regarding the Managed Premises except any injury,
damage or violation resulting from Managing Agent’s default hereunder, or from
Managing Agent’s willful bad faith or gross negligence in the performance of
its duties hereunder.  Without limiting
the foregoing, the Owners shall promptly advance expenses incurred by the
indemnitees referred to in this section for matters referred to in this
section, upon request for such advancement.

 

(c)     Owners agree that required insurance shall include, at Owners’
expense, public liability and workmen’s compensation insurance as required by
law and as mutually agreed by Owners and Managing Agent.

 

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

 

If
to the Company or the Owners:

 

Government
Properties Income Trust

400 Centre Street

Newton, Massachusetts 02458

Attention:  President 

Facsimile No.:  (617) 219-1441

 

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If
to Managing Agent:

 

Reit
Management & Research LLC

400 Centre Street

Newton, Massachusetts 02458

Attention:  President 

Facsimile No.:  (617) 928-1305

 

13.           Limitation of Liability.

 

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

 

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

 

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

 

14.           Other Activities of Managing
Agent.  Nothing
herein shall prevent Managing Agent from engaging in other activities or
businesses or from acting as Managing Agent to any other person or entity (including
other real estate investment trusts) even though such person or entity has businesses
similar to those of the Company or the Owners. 
The Company and the Owners acknowledge that Managing Agent manages and
provides property management services to real estate investment trusts and
other persons or entities (including, as of the date of this Agreement, HRPT
Properties Trust, Hospitality Properties Trust, Senior Housing Properties
Trust, Five Star Quality Care, Inc. and TravelCenters of America LLC) and,
except as otherwise expressly agreed in writing, waives any conflict arising
therefrom.  In addition, nothing herein
shall prevent any shareholder or affiliate of Managing Agent from engaging in
any other business or from rendering services of any kind to any other person or
entity (including competitive business activities).  The Company and the Owners acknowledge and
agree that Managing Agent has certain interests that may be divergent from
those of the Company and the Owners.  The
parties agree that these relationships and interests shall not affect the party’s
rights and 

 

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obligations under this
Agreement; provided, however, the Company and the Owners further
acknowledge and agree that whenever any conflicts of interest arise resulting
from the relationships and interests described or referred to in this section
or any such relationship or interest as may arise or be present in the future
by and between the Company or the Owners and Managing Agent or their respective
affiliates or any entity with whom Managing Agent has a relationship or
contract, Managing Agent will act on its own behalf and/or on behalf of any
such entity and not on the Company’s or the Owners’ behalf, and the Company and
the Owners shall make their own decisions and require and obtain the advice and
assistance of independent third parties at their own cost, as they may deem
necessary.

 

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

 

16.           Independent Contractor.  This Agreement is not one of general agency
by Managing Agent for Owners, but one with Managing Agent engaged as an
independent contractor.  Nothing in this
Agreement is intended to create a joint venture, partnership, tenancy-in-common
or other similar relationship between Owners and Managing Agent for any
purposes whatsoever, and, without limiting the generality of the foregoing,
neither the terms of this Agreement nor the fact that Owners and Managing Agent
have joint interests in any one or more investments, ownership or other
interests in any one or more entities or may have common officers or employees
or a tenancy relationship shall be construed so as to make them such partners
or joint venturers or impose any liability as such on either of them.

 

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

 

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

 

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

 

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

 

21.           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.

 

22.           Survival.  The provisions of Sections 8 (limited
to the last paragraph of such Section), 9, 11, 12, 13, 17, 20, 22, 23 and 24 of
this Agreement shall survive the termination hereof.

 

23.           Arbitration.

 

(a)     Any disputes, claims or controversies between the parties (i)
arising out of or relating to this Agreement or the provision of services by the
Managing Agent pursuant to this Agreement, or (ii) brought by or on behalf of
any shareholder of the Owners (which, for purposes of this Section 23, shall
mean any shareholder of record or any beneficial owner of shares of the Owners,
or any former shareholder of record or beneficial owner of shares of the
Owners), either on its own behalf, on behalf of the Owners or on behalf of any
series or class of shares of the Owners or shareholders of the Owners against
the Owners or any trustee, officer, manager (including Reit Management &
Research LLC or its successor), agent or employee of the Owners, including
disputes, claims or controversies relating to the meaning, interpretation,
effect, validity, performance or enforcement of this Agreement the Declarations
or the Bylaws of the Owners (all of which are referred to as “Disputes”)
or relating in any way to such a Dispute or Disputes, shall on the demand of
any party to such Dispute be resolved through binding and final arbitration in
accordance with the Commercial Arbitration Rules (the “Rules”) of
the American Arbitration Association (“AAA”) then in effect, except as modified
herein.  For avoidance of doubt, and not
as a limitation, Disputes are intended to include derivative actions against
trustees, officers or managers of the Owners and class actions by a shareholder
against those individuals or entities and the Owners.

 

(b)     There shall be three arbitrators.  If there are (i) only two parties to the
Dispute (with, for purposes of this Section 23, any and all
Owners involved in the Dispute treated as one party) each party shall select
one arbitrator within 15 days after receipt by respondent of a copy of the
demand for arbitration and (ii) more than two parties to the Dispute, all
claimants, on the one hand, and all respondents, on the other hand, shall each
select, by the vote of a majority of the claimants or the respondents, as the
case may be, one arbitrator.  The two
party-nominated arbitrators shall jointly nominate the third and presiding
arbitrator within 15 days of the nomination of the second arbitrator.  If any arbitrator has not been nominated
within the time limit specified herein, then the AAA shall provide a list of
proposed arbitrators in accordance with the Rules and the arbitrator shall
be appointed by the AAA in accordance with a listing, striking and ranking
procedure, with each party having a limited number of strikes, excluding
strikes for cause.    For the avoidance
of doubt, the arbitrators appointed by the parties to such Dispute may be
affiliates or interested persons of such parties but the third arbitrator elected
by the party arbitrators or by the AAA shall be unaffiliated with either party.

 

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

 

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

 

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

 

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

 

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

 

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

 

24.           Consent to Jurisdiction and Forum.  This Section 24 is subject
to, and shall not in any way limit the application of, Section 23;
in case of any conflict between this Section 24 and Section 23,
Section 23 shall govern. 
The exclusive jurisdiction and venue in any action brought by any party
hereto pursuant to this Agreement shall lie in any federal or state court
located in Boston, Massachusetts.  By
execution and delivery of this Agreement, each party hereto irrevocably submits
to the jurisdiction of such courts for itself and in respect of its property
with respect to such action. The parties irrevocably agree that venue would be
proper in such court, and hereby waive any objection that such court is an
improper or inconvenient forum for the resolution of such action.  The parties further agree and consent to the
service of any 

 

12

 

process required by any such
court by delivery of a copy thereof in accordance with Section 12
and that any such delivery shall constitute valid and lawful service of process
against it, without necessity for service by any other means provided by
statute or rule of court.

 

25.           Entire
Agreement.  This
Agreement constitutes the entire agreement of the parties hereto with respect
to the subject matter hereof and supersedes and cancels any pre-existing
agreements with respect to such subject matter.

 

26.          Other Agreements.  The parties hereto are also parties to a
Business Management Agreement, dated as of the date hereof, as in effect from
time to time (the "Business Management Agreement").  The parties agree that this Agreement does
not include or otherwise address the rights and obligations of the parties
under the Business Management Agreement and that the Business Management
Agreement provides for its own separate rights and obligations of the parties
thereto, including without limitation separate compensation payable by the
Company to Managing Agent thereunder for services to be provided by the
Managing Agent pursuant to the Business Management Agreement.

 

[Signature Page To
Follow]

 

13

 

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

 

 

	
   

  	
  MANAGING AGENT:

  
	
   

  	
   

  
	
   

  	
  REIT MANAGEMENT &
  RESEARCH LLC

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
  OWNERS:

  
	
   

  	
   

  	
   

  
	
   

  	
  GOVERNMENT PROPERTIES INCOME
  TRUST, on its own behalf and on behalf of its subsidiaries

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name: David M. Blackman

  
	
   

  	
   

  	
  Title: Treasurer and Chief
  Financial Officer

  

 

 

[Signature Page to Property Management Agreement]

 

14Exhibit 10.6

 

INDEMNIFICATION AGREEMENT

 

THIS INDEMNIFICATION AGREEMENT (this “Agreement”)
is made and entered into as of
[                ]
(the “Effective Date”), by and between Government Properties Income Trust, a
Maryland real estate investment trust (the “Company”), and
[                ]
(“Indemnitee”).

 

WHEREAS, Indemnitee currently serves as a
[                ]
of the Company and may, in connection therewith, be subjected to claims, suits
or proceedings arising from such service; and

 

WHEREAS, as an inducement to Indemnitee to
continue to serve as such
[                ],
the Company has agreed to indemnify and to advance expenses and costs incurred
by Indemnitee in connection with any such claims, suits or proceedings, to the
maximum extent permitted by law as hereinafter provided; and

 

WHEREAS, the parties by this Agreement desire
to set forth their agreement regarding indemnification and advance of expenses;

 

NOW, THEREFORE, in consideration of the
premises and the covenants contained herein, the Company and Indemnitee do
hereby covenant and agree as follows:

 

Section 1.           Definitions.  For purposes of this Agreement:

 

(a)       “Change
in Control” means a change in control of the Company occurring after the
Effective Date of a nature that would be required to be reported in response to
Item 6(e) of Schedule 14A of Regulation 14A (or in response to any similar
item on any similar schedule or form) promulgated under the Securities Exchange
Act of 1934, as amended (the “Act”), whether or not the Company is then subject
to such reporting requirement; provided, however, that, without
limitation, such a Change in Control shall be deemed to have occurred if after
the Effective Date (i) any “person” (as such term is used in Sections 13(d) and
14(d) of the Act) is or becomes the “beneficial owner” (as defined in Rule 13d-3
under the Act), directly or indirectly, of securities of the Company
representing 10% or more of the combined voting power of all the Company’s
then-outstanding securities entitled to vote generally in the election of
trustees without the prior approval of at least two-thirds of the members of
the Board of Trustees of the Company (the “Board of Trustees”) in office
immediately prior to such person attaining such percentage interest; (ii) there
occurs a proxy contest, or the Company is a party to a merger, consolidation,
sale of assets, plan of liquidation or other reorganization not approved by at
least two-thirds of the members of the Board of Trustees then in office, as a
consequence of which 

 

 

 

members
of the Board of Trustees in office immediately prior to such transaction or
event constitute less than a majority of the Board of Trustees thereafter; or (iii) during
any period of two consecutive years, other than as a result of an event described
in clause (a)(ii) of this Section 1, individuals who at the
beginning of such period constituted the Board of Trustees (including for this
purpose any new trustee whose election or nomination for election by the
Company’s shareholders was approved by a vote of at least two-thirds of the
trustees then still in office who were trustees at the beginning of such
period) cease for any reason to constitute at least a majority of the Board of
Trustees.

 

(b)       “Corporate
Status” means the status of a person who is or was a director, trustee, officer
or agent of the Company and the status of a person who, while a director,
trustee, officer or agent of the Company, is or was serving at the request of
the Company as a director, trustee, officer or agent of another foreign or
domestic real estate investment trust, corporation, partnership, limited
liability company, joint venture, trust, other enterprise or employee benefit
plan.

 

(c)       “Disinterested
Trustee” means a trustee of the Company who is not and was not a party to the
Proceeding in respect of which indemnification and/or advance of Expenses is
sought by Indemnitee.

 

(d)       “Expenses”
means all expenses, including, but not limited to, all reasonable attorneys’
fees and costs, retainers, court costs, transcript costs, fees of experts,
witness fees, travel expenses, duplicating costs, printing and binding costs,
telephone charges, postage, delivery service fees, and all other disbursements
or expenses of the types customarily incurred in connection with prosecuting, defending,
preparing to prosecute or defend, investigating, or being or preparing to be a
witness in a Proceeding.

 

(e)       “Independent
Counsel” means a law firm, or a member of a law firm, selected by the
Indemnitee and reasonably acceptable to the Company, that is experienced in
matters of business law and that neither is, nor in the past two years has
been, retained to represent (i) the Company or Indemnitee in any matter
material to either such party (other than with respect to matters concerning
Indemnitee under this Agreement or of other indemnities of the Company under
similar indemnification agreements), or (ii) any other party to or
participant or witness in the Proceeding giving rise to a claim for
indemnification or advance of Expenses hereunder.

 

(f)        “Proceeding”
means any threatened, pending or completed action, suit, arbitration, alternate
dispute resolution mechanism, investigation, administrative hearing or any
other proceeding, whether civil, criminal, administrative or investigative
(including on appeal), except one initiated by an Indemnitee pursuant to Section 9.

 

Section 2.           Indemnification
- General.  The Company shall
indemnify, and advance Expenses to, Indemnitee (a) as provided in this
Agreement and (b) otherwise to the maximum 

 

2

 

extent
permitted by Maryland law in effect on the Effective Date and as amended from
time to time; provided, however, that no change in Maryland law
shall have the effect of reducing the benefits available to Indemnitee
hereunder based on Maryland law as in effect on the Effective Date.  The rights of Indemnitee provided in this Section 2
shall include, without limitation, the rights set forth in the other sections
of this Agreement, including any additional indemnification permitted by Section 2-418(g) of
the Maryland General Corporation Law (“MGCL”), as applicable to a Maryland real
estate investment trust by virtue of Section 8-301(15) of the Maryland
REIT Law.

 

Section 3.           Proceedings
Other Than Derivative Proceedings by or in the Right of the Company.  Indemnitee shall be entitled to the rights of
indemnification provided in this Section 3 if, by reason of his
Corporate Status, he is, or is threatened to be, made a party to any
threatened, pending, or completed Proceeding, other than a derivative
Proceeding by or in the right of the Company (or, if applicable, such other
enterprise at which Indemnitee is or was serving at the request of the
Company).  Pursuant to this Section 3,
Indemnitee shall be indemnified against all judgments, penalties, fines and
amounts paid in settlement and all Expenses incurred by him or on his behalf in
connection with a Proceeding by reason of Indemnitee’s Corporate Status unless
it is established that (i) the act or omission of Indemnitee was material
to the matter giving rise to the Proceeding and (a) was committed in bad
faith or (b) was the result of active and deliberate dishonesty, (ii) Indemnitee
actually received an improper personal benefit in money, property or services,
or (iii) in the case of any criminal Proceeding, Indemnitee had reasonable
cause to believe that his conduct was unlawful.

 

Section 4.           Derivative
Proceedings by or in the Right of the Company.  Indemnitee shall be entitled to the rights of
indemnification provided in this Section 4 if, by reason of his
Corporate Status, he is, or is threatened to be, made a party to any
threatened, pending or completed derivative Proceeding brought by or in the
right of the Company (or, if applicable, such other enterprise at which
Indemnitee is or was serving at the request of the Company) to procure a
judgment in its favor.  Pursuant to this Section 4,
Indemnitee shall be indemnified against all amounts paid in settlement and all
Expenses incurred by him or on his behalf in connection with such Proceeding
unless it is established that (i) the act or omission of Indemnitee was
material to the matter giving rise to such a Proceeding and (a) was
committed in bad faith or (b) was the result of active and deliberate
dishonesty or (ii) Indemnitee actually received an improper personal
benefit in money, property or services.

 

Section 5.           Indemnification
for Expenses of a Party Who is Partly Successful.  Without limitation on Section 3
and Section 4, if Indemnitee is not wholly successful in any
Proceeding covered by this Agreement, but is successful, on the merits or
otherwise, as to one or more but less than all claims, issues or matters in
such Proceeding, the Company shall indemnify Indemnitee under this Section 5
for all Expenses incurred by him or on his behalf in connection with each
successfully resolved claim, issue or matter, allocated on a reasonable and
proportionate basis.  For purposes of
this Section and without limitation, the termination of any claim, issue
or matter in such a Proceeding by dismissal, with or without prejudice, shall
be deemed to be a successful result as to such claim, issue or matter.

 

Section 6.           Advance
of Expenses.  The Company shall
advance all Expenses incurred by or on behalf of Indemnitee in connection with
any Proceeding to which Indemnitee is, or is 

 

3

 

threatened to
be, made a party or a witness, within ten days after the receipt by the Company
of a statement or statements from Indemnitee requesting such advance or
advances from time to time, whether prior to or after final disposition of such
Proceeding.  Such statement or statements
shall reasonably evidence the Expenses incurred by Indemnitee and shall include
or be preceded or accompanied by a written affirmation by Indemnitee of
Indemnitee’s good faith belief that the standard of conduct necessary for
indemnification by the Company as authorized by law and by this Agreement has
been met and a written undertaking by or on behalf of Indemnitee, in substantially
the form attached hereto as Exhibit A or in such form as may be
required under applicable law as in effect at the time of the execution
thereof, to reimburse the portion of any Expenses advanced to Indemnitee
relating to claims, issues or matters in the Proceeding as to which it shall
ultimately be established that the standard of conduct has not been met and
which have not been successfully resolved as described in Section 5.  To the extent that Expenses advanced to
Indemnitee do not relate to a specific claim, issue or matter in the
Proceeding, such Expenses shall be allocated on a reasonable and proportionate
basis.  The undertaking required by this Section 6
shall be an unlimited general obligation by or on behalf of Indemnitee and
shall be accepted without reference to Indemnitee’s financial ability to repay
such advanced Expenses and without any requirement to post security therefor.

 

Section 7.           Procedure
for Determination of Entitlement to Indemnification.

 

(a)      To
obtain indemnification under this Agreement, Indemnitee shall submit to the
Company a written request, including such documentation and information as is
reasonably available to Indemnitee and is reasonably necessary to determine
whether and to what extent Indemnitee is entitled to indemnification.  The Secretary of the Company shall, promptly
upon receipt of such a request for indemnification, advise the Board of
Trustees in writing that Indemnitee has requested indemnification.

 

(b)       Upon
written request by Indemnitee for indemnification pursuant to the first
sentence of Section 7(a) hereof, a determination, if required
by applicable law, with respect to Indemnitee’s entitlement thereto shall
promptly be made in the specific case: (i) if a Change in Control shall
have occurred, by Independent Counsel in a written opinion to the Board of
Trustees, a copy of which shall be delivered to Indemnitee; or (ii) if a
Change of Control shall not have occurred or if after a Change of Control
Indemnitee shall so request, (A) by the Board of Trustees (or a duly
authorized committee thereof) by a majority vote of a quorum consisting of
Disinterested Trustees (as herein defined), or (B) if a quorum of the
Board of Trustees consisting of Disinterested Trustees is not obtainable or,
even if obtainable, such quorum of Disinterested Trustees so directs, by
Independent Counsel in a written opinion to the Board of Trustees, a copy of
which shall be delivered to Indemnitee, or (C) if so directed by a
majority of the members of the Board of Trustees, by the shareholders of the
Company; and, if it is so determined that Indemnitee is entitled to
indemnification, payment to Indemnitee shall be made within ten days after such
determination.  Indemnitee shall
cooperate with the person, persons or entity making such determination with
respect to Indemnitee’s entitlement to indemnification, including providing to
such person, persons or entity upon reasonable advance request any
documentation or information which is not privileged or otherwise protected
from disclosure and which is reasonably available to Indemnitee and reasonably
necessary to such determination.  

 

4

 

Any
Expenses incurred by Indemnitee in so cooperating with the person, persons or
entity making such determination shall be borne by the Company (irrespective of
the determination as to Indemnitee’s entitlement to indemnification) and the
Company shall indemnify and hold Indemnitee harmless therefrom.

 

(c)       The
Company shall pay the fees and expenses of Independent Counsel, if one is
appointed pursuant to this Section 7.

 

Section 8.           Presumptions
and Effect of Certain Proceedings.

 

(a)       In
making a determination with respect to entitlement to indemnification
hereunder, the person or persons or entity making such determination shall
presume that Indemnitee is entitled to indemnification under this Agreement if
Indemnitee has submitted a request for indemnification in accordance with Section 7(a) of
this Agreement, and the Company shall have the burden of proof to overcome that
presumption in connection with the making of any determination contrary to that
presumption.

 

(b)       The
termination of any Proceeding by judgment, order, settlement, conviction, a
plea of nolo contendere or its equivalent, or an entry of an order of
probation prior to judgment, does not create a presumption that Indemnitee did
not meet the requisite standard of conduct described herein for
indemnification.

 

Section 9.           Remedies
of Indemnitee.

 

(a)       If
(i) a determination is made pursuant to Section 7 that
Indemnitee is not entitled to indemnification under this Agreement, (ii) advance
of Expenses is not timely made pursuant to Section 6, (iii) no
determination of entitlement to indemnification shall have been made pursuant
to Section 7(b) within 30 days after receipt by the Company of
the request for indemnification, (iv) payment of indemnification is not
made pursuant to Section 5 within ten days after receipt by the
Company of a written request therefor, or (v) payment of indemnification
is not made within ten days after a determination has been made that Indemnitee
is entitled to indemnification, Indemnitee shall (A) unless the Company
demands arbitration as provided by Section 16, be entitled to an
adjudication in an appropriate court of the State of Maryland or in any other
court of competent jurisdiction or (B) be entitled to seek an award in
arbitration as provided by Section 16, in each case of his
entitlement to such indemnification or advance of Expenses.

 

(b)       In
any judicial proceeding or arbitration commenced pursuant to this Section 9,
the Company shall have the burden of proving that Indemnitee is not entitled to
indemnification or advance of Expenses, as the case may be.

 

5

 

(c)       If
a determination shall have been made pursuant to Section 7(b) that
Indemnitee is entitled to indemnification, the Company shall be bound by such
determination in any judicial proceeding or arbitration commenced pursuant to
this Section 9, absent a misstatement by Indemnitee of a material
fact, or an omission of a material fact necessary to make Indemnitee’s
statement not materially misleading, in connection with the request for
indemnification.

 

(d)       In
the event that Indemnitee, pursuant to this Section 9, seeks a
judicial adjudication of or an award in arbitration as provided by Section 16
to enforce his rights under, or to recover damages for breach of, this
Agreement by the Company, Indemnitee shall be entitled to recover in full from
the Company, and shall be indemnified in full by the Company for, any and all
Expenses incurred by him in such judicial adjudication or arbitration if it is
determined that the Indemnitee is entitled to enforce any of his rights under,
or to recover any damages for breach of, this Agreement by the Company.

 

Section 10.         Defense
of the Underlying Proceeding.

 

(a)       Indemnitee
shall notify the Company promptly upon being served with or receiving any
summons, citation, subpoena, complaint, indictment, information, notice,
request or other document relating to any Proceeding which may result in the
right to indemnification or the advance of Expenses hereunder; provided,
however, that the failure to give any such notice shall not disqualify
Indemnitee from the right, or otherwise affect in any manner any right of
Indemnitee, to indemnification or the advance of Expenses under this Agreement
unless the Company’s ability to defend in such Proceeding or to obtain proceeds
under any insurance policy is materially and adversely prejudiced thereby, and
then only to the extent the Company is thereby actually so prejudiced.

 

(b)       Subject
to the provisions of the last sentence of this Section 10(b) and
of Section 10(c) below, the Company shall have the right to
defend Indemnitee in any Proceeding which may give rise to indemnification
hereunder; provided, however, that the Company shall notify
Indemnitee of any such decision to defend within 15 calendar days following
receipt of notice of any such Proceeding under Section 10(a) above,
and the counsel selected by the Company shall be reasonably satisfactory to
Indemnitee.  The Company shall not,
without the prior written consent of Indemnitee, consent to the entry of any
judgment against Indemnitee or enter into any settlement or compromise which (i) includes
an admission of fault of Indemnitee or (ii) does not include, as an
unconditional term thereof, the full release of Indemnitee from all liability
in respect of such Proceeding, which release shall be in form and substance
reasonably satisfactory to Indemnitee. 
This Section 10(b) shall not apply to a Proceeding
brought by Indemnitee under Section 9 above or Section 15.

 

(c)       Notwithstanding
the provisions of Section 10(b), if in a Proceeding to which
Indemnitee is a party by reason of Indemnitee’s Corporate Status, (i) Indemnitee
reasonably concludes, based upon an opinion of counsel approved by the Company,
which approval shall not be unreasonably withheld, that he may have separate
defenses or 

 

6

 

counterclaims
to assert with respect to any issue which may not be consistent with other
defendants in such Proceeding, (ii) Indemnitee reasonably concludes, based
upon an opinion of counsel approved by the Company, which approval shall not be
unreasonably withheld, that an actual or apparent conflict of interest or
potential conflict of interest exists between Indemnitee and the Company, or (iii) the
Company fails to assume the defense of such Proceeding in a timely manner,
Indemnitee shall be entitled to be represented by separate legal counsel of
Indemnitee’s choice, subject to the prior approval of the Company, which shall
not be unreasonably withheld, at the expense of the Company.  In addition, if the Company fails to comply
with any of its obligations under this Agreement or in the event that the
Company or any other person takes any action to declare this Agreement void or
unenforceable, or institutes any Proceeding to deny or to recover from
Indemnitee the benefits intended to be provided to Indemnitee hereunder,
Indemnitee shall have the right to retain counsel of Indemnitee’s choice,
subject to the prior approval of the Company, which shall not be unreasonably
withheld, at the expense of the Company (subject to Section 9(d)),
to represent Indemnitee in connection with any such matter.

 

Section 11.         Liability
Insurance.  To the extent the Company
maintains an insurance policy or policies providing liability insurance for any
of its directors, trustees or officers, Indemnitee shall be covered by such
policy or policies, in accordance with its or their terms, to the maximum
extent of the coverage available for any Company director, trustee or officer
during the Indemnitee’s tenure as a director, trustee or officer and, following
a termination of Indemnitee’s service in connection with a Change in Control,
for a period of six years thereafter.

 

Section 12.         Non-Exclusivity; Survival of Rights; Subrogation.

 

(a)       The
rights of indemnification and advance of Expenses as provided by this Agreement
shall not be deemed exclusive of any other rights to which Indemnitee may at
any time be entitled under applicable law, the Amended and Restated Declaration
of Trust (as the same may be amended from time to time, the “Declaration of
Trust”) or Bylaws of the Company (as the same may be amended from time to time,
the “Bylaws”), any agreement or a resolution of the shareholders entitled to
vote generally in the election of trustees or of the Board of Trustees, or
otherwise.  No amendment, alteration or
repeal of this Agreement or of any provision hereof shall limit or restrict any
right of Indemnitee under this Agreement in respect of any action taken or
omitted by such Indemnitee in his Corporate Status prior to such amendment,
alteration or repeal.

 

(b)       In
the event of any payment under this Agreement, the Company shall be subrogated
to the extent of such payment to all of the rights of recovery of Indemnitee,
who shall execute all papers required and take all action necessary to secure
such rights, including execution of such documents as are necessary to enable
the Company to bring suit to enforce such rights.

 

(c)       The
Company shall not be liable under this Agreement to make any payment of amounts
otherwise indemnifiable or payable or reimbursable as Expenses hereunder if and
to the extent that Indemnitee has otherwise actually received such payment
under any insurance policy, contract, agreement or otherwise.

 

7

 

Section 13.         Binding
Effect.

 

(a)       The
indemnification and advance of Expenses provided by, or granted pursuant to,
this Agreement shall be binding upon and be enforceable by the parties hereto
and their respective successors and assigns (including any direct or indirect
successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business or assets of the Company), shall continue as
to an Indemnitee who has ceased to be a director, trustee, officer, employee or
agent of the Company or of any other real estate investment trust, corporation,
partnership, limited liability company, joint venture, trust, employee benefit
plan or other enterprise which such person is or was serving at the written
request of the Company, and shall inure to the benefit of Indemnitee and his or
her spouse, assigns, heirs, devisees, executors and administrators and other
legal representatives.

 

(b)      Any
successor of the Company (whether direct or indirect by purchase, merger,
consolidation or otherwise) to all, substantially all or a substantial part, of
the business and/or assets of the Company shall be automatically deemed to have
assumed and agreed to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform if no such succession had
taken place, provided that no such assumption shall relieve the Company of its
obligations hereunder.  To the extent
required by applicable law to give effect to the foregoing sentence and to the
extent requested by Indemnitee, the Company shall require and cause any such
successor to expressly assume and agree to perform this Agreement by written
agreement in form and substance satisfactory to Indemnitee.

 

Section 14.         Severability.  If any provision or provisions of this Agreement
shall be held to be invalid, illegal or unenforceable for any reason
whatsoever: (a) the validity, legality and enforceability of the remaining
provisions of this Agreement (including, without limitation, each portion of
any section of this Agreement containing any such provision held to be invalid,
illegal or unenforceable that is not itself invalid, illegal or unenforceable)
shall not in any way be affected or impaired thereby; and (b) to the
fullest extent possible, the provisions of this Agreement (including, without
limitation, each portion of any section of this Agreement containing any such
provision held to be invalid, illegal or unenforceable, that is not itself
invalid, illegal or unenforceable) shall be construed so as to give effect to the
intent manifested thereby.

 

Section 15.         Limitation
and Exception to Right of Indemnification or Advance of Expenses.  Notwithstanding any other provision of this
Agreement, (a) any indemnification or advance of Expenses to which
Indemnitee is otherwise entitled under the terms of this Agreement shall be
made only to the extent such indemnification or advance of Expenses does not
conflict with applicable Maryland law and (b) Indemnitee shall not be
entitled to indemnification or advance of Expenses under this Agreement with
respect to any Proceeding brought by Indemnitee, unless (i) the Proceeding
is brought to enforce indemnification under this Agreement, the Declaration of
Trust, the Bylaws, liability insurance policy or policies, if any, or otherwise
or (ii) the Declaration of Trust, the Bylaws, a resolution of the
shareholders entitled to vote generally in the election of trustees or of the
Board of Trustees or an agreement approved by the Board of Trustees to which
the Company is a party expressly provides otherwise.

 

8

 

Section 16.         Arbitration.

 

(a)       Any
disputes, claims or controversies between the parties (i) regarding the
Indemnitee’s entitlement to indemnification or advance of Expenses hereunder or
otherwise arising out of or relating to this Agreement, or (ii) brought by
or on behalf of any shareholder of the Company (which, for purposes of this Section 16,
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 own behalf, on behalf of the Company or on behalf
of any series or class of shares of the Company or shareholders of the Company
against the Company or any trustee, officer, manager (including Reit Management &
Research LLC or its successor), agent or employee of the Company, including
disputes, claims or controversies relating to the meaning, interpretation,
effect, validity, performance or enforcement of this Agreement, the Declaration
of Trust or the Bylaws (all of which are referred to as “Disputes”) or relating
in any way to such a Dispute or Disputes, shall on the demand of any party to
such Dispute be resolved through binding and final arbitration in accordance
with the Commercial Arbitration Rules (the “Rules”) of the American
Arbitration Association (“AAA”) then in effect, except as modified herein.  For the avoidance of doubt, and not as a
limitation, Disputes are intended to include derivative actions against
trustees, officers or managers of the Company and class actions by a
shareholder against those individuals or entities and the Company.

 

(b)       There
shall be three arbitrators.  If there are
(i) only two parties to the Dispute, each party shall select one
arbitrator within 15 days after receipt by respondent of a copy of the demand
for arbitration and (ii) more than two parties to the Dispute, all
claimants, on the one hand, and all respondents, on the other hand, shall each
select, by the vote of a majority of the claimants or the respondents, as the
case may be, one arbitrator.  The two
party-nominated arbitrators shall jointly nominate the third and presiding
arbitrator within 15 days of the nomination of the second arbitrator.  If any arbitrator has not been nominated
within the time limit specified herein, then the AAA shall provide a list of
proposed arbitrators in accordance with the Rules and the arbitrator shall
be appointed by the AAA in accordance with a listing, striking and ranking
procedure, with each party having a limited number of strikes, excluding
strikes for cause.  For the avoidance of
doubt, the arbitrators appointed by the parties to such Dispute may be
affiliates or interested persons of such parties but the third arbitrator
elected by the party arbitrators or by the AAA shall be unaffiliated with
either party.

 

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

 

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

 

(e)       In
rendering an award or decision (the “Award”), the arbitrators shall be required
to follow the laws of the State of Maryland. 
Any arbitration proceedings or Award 

 

9

 

rendered
hereunder and the validity, effect and interpretation of this arbitration
agreement shall be governed by the Federal Arbitration Act, 9 U.S.C. §1 et
seq.  The Award shall be in writing and may,
but shall not be required to, briefly state the findings of fact and
conclusions of law on which it is based.

 

(f)            Except to the extent expressly
provided by this Agreement (including Section 5 and Section 9(d))
or as otherwise agreed between the parties, each party involved in a Dispute
shall bear its own costs and expenses (including attorneys’ fees), and the
arbitrators shall not render an award that would include shifting of any such
costs or expenses (including attorneys’ fees) or, in a derivative case or class
action by a shareholder of the Company, award any portion of the Company’s
award to the claimant or the claimant’s attorneys.  Each party (or, if there are more than two
parties to the Dispute, all claimants, on the one hand, and all respondents, on
the other hand, respectively) shall bear the costs and expenses of its (or
their) selected arbitrator and the parties (or, if there are more than two
parties to the Dispute, all claimants, on the one hand, and all respondents, on
the other hand) shall equally bear the costs and expenses of the third
appointed arbitrator.

 

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

 

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

 

Section 17.         Period of
Limitations.  To the fullest extent
permitted by law, no legal action shall be brought, and no cause of action
shall be asserted, by or on behalf of the Company or any controlled affiliate
of the Company against Indemnitee, Indemnitee’s spouse, heirs, executors or
personal or legal representatives after the expiration of two years from the
date of accrual of such cause of action, and any claim or cause of action of
the Company or its controlled affiliate shall be extinguished and deemed
released unless asserted by the timely filing of a legal action within such
two-year period; provided, however, if any shorter period of
limitations is otherwise applicable to any such cause of action, such shorter
period shall govern.

 

10

 

Section 18.         Reports to
Shareholders.  To the extent required
by the MGCL, the Company shall report in writing to its shareholders the
payment of any amounts for indemnification of, or advance of Expenses to,
Indemnitee under this Agreement arising out of a derivative Proceeding by or in
the right of the Company with the notice of the meeting of shareholders of the
Company next following the date of the payment of any such indemnification or
advance of Expenses or prior to such meeting.

 

Section 19.         Counterparts.  This Agreement may be executed in one or more
counterparts, each of which shall for all purposes be deemed to be an original
but all of which together shall constitute one and the same Agreement.  One such counterpart signed by the party
against whom enforceability is sought shall be sufficient to evidence the
existence of this Agreement.

 

Section 20.         Headings.  The headings of the paragraphs of this
Agreement are inserted for convenience only and shall not be deemed to
constitute part of this Agreement or to affect the construction thereof.

 

Section 21.         Modification
and Waiver.  No supplement,
modification or amendment of this Agreement shall be binding unless executed in
writing by both of the parties hereto. 
No waiver of any of the provisions of this Agreement shall be deemed or
shall constitute a waiver of any other provisions hereof (whether or not
similar) nor shall such waiver constitute a continuing waiver.

 

Section 22.         Notices.  Any notice, report or other communication
required or permitted to be given hereunder shall be in writing unless some
other method of giving such notice, report or other communication is accepted
by the party to whom it is given, and shall be given by being delivered at the
following addresses to the parties hereto:

 

(a)       If
to Indemnitee, to:  The address set forth
on the signature page hereto.

 

(b)       If
to the Company to:

 

Government Properties Income Trust

400 Centre Street

Newton, Massachusetts 02458

Attn:  Secretary

 

or to such other address as may have been
furnished to Indemnitee by the Company or to the Company by Indemnitee, as the
case may be.

 

Section 23.         Governing
Law.  The parties agree that this
Agreement shall be governed by, and construed and enforced in accordance with,
the laws of the State of Maryland, without regard to its conflicts of laws
rules.

 

11

 

Section 24.         Miscellaneous.  Use of the masculine pronoun in this
Agreement shall be deemed to include usage of the feminine pronoun where
appropriate.

 

[SIGNATURE PAGE FOLLOWS]

 

12

 

IN WITNESS WHEREOF, the parties hereto have
executed this Agreement as of the day and year first above written.

 

 

	
   

  	
   

  	
  GOVERNMENT PROPERTIES INCOME TRUST

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  INDEMNITEE

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Address:

  

 

 

EXHIBIT A

 

FORM OF UNDERTAKING TO REPAY EXPENSES
ADVANCED

 

The Board of Trustees of Government
Properties Income Trust

 

Re: 
Undertaking to Repay Expenses Advanced

 

Ladies and Gentlemen:

 

This undertaking is being provided pursuant
to that certain Indemnification Agreement dated
                            ,
20    , by and between Government Properties Income Trust
(the “Company”) and the undersigned Indemnitee (the “Indemnification Agreement”),
pursuant to which I am entitled to advance of expenses in connection with [Description of Proceeding] (the “Proceeding”).

 

Terms used herein and not otherwise defined
shall have the meanings specified in the Indemnification Agreement.

 

I am subject to the Proceeding by reason of
my Corporate Status or by reason of alleged actions or omissions by me in such
capacity.  I hereby affirm that at all
times, insofar as I was involved as [a trustee] [an officer]
of the Company, in any of the facts or events giving rise to the Proceeding, I (1) did
not act with bad faith or active or deliberate dishonesty, (2) did not
receive any improper personal benefit in money, property or services and (3) in
the case of any criminal proceeding, had no reasonable cause to believe that
any act or omission by me was unlawful.

 

In consideration of the advance of Expenses
by the Company for reasonable attorneys’ fees and related expenses incurred by
me in connection with the Proceeding (the “Advanced Expenses”), I hereby agree
that if, in connection with the Proceeding, it is established that (1) an
act or omission by me was material to the matter giving rise to the Proceeding
and (a) was committed in bad faith or (b) was the result of active
and deliberate dishonesty or (2) I actually received an improper personal
benefit in money, property or services or (3) in the case of any criminal
proceeding, I had reasonable cause to believe that the act or omission was
unlawful, then I shall promptly reimburse the portion of the Advanced Expenses
relating to the claims, issues or matters in the Proceeding as to which the
foregoing findings have been established and which have not been successfully
resolved as described in Section 5 of the Indemnification Agreement.  To the extent that Advanced Expenses do not
relate to a specific claim, issue or matter in the Proceeding, I agree that
such Expenses shall be allocated on a reasonable and proportionate basis.

 

 

IN WITNESS WHEREOF, I have executed this
Affirmation and Undertaking on this             
day of                               ,
20    .

 

 

	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  

 

 

Schedule to Exhibit 10.6

 

The following individuals are parties to
Indemnification Agreements with the Company which are substantially identical
in all material respects to the representative Indemnification Agreement filed
herewith and are dated as of the respective dates listed below.  The other Indemnification Agreements are
omitted pursuant to Instruction 2 to Item 601 of Regulation S-K.

 

	
  Name of Signatory

  	
   

  	
  Date

  
	
  David M. Blackman

  	
   

  	
  [                  ],
  2009

  
	
  Jennifer B. Clark

  	
   

  	
  [                  ],
  2009

  
	
  Barbara D. Gilmore

  	
   

  	
  [                  ],
  2009

  
	
  John L. Harrington

  	
   

  	
  [                  ],
  2009

  
	
  Adam D. Portnoy

  	
   

  	
  [                  ],
  2009

  
	
  Barry M. Portnoy

  	
   

  	
  [                  ],
  2009

  
	
  William J. Sheehan

  	
   

  	
  [                  ],
  2009

  
	
  Jeffrey P. Somers

  	
   

  	
  [                  ],
  2009

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