Document:

EXHIBIT 4.1

                          SUPPLEMENTAL INDENTURE NO. 11

                                 by and between

                              HRPT PROPERTIES TRUST

                                       and

                       STATE STREET BANK AND TRUST COMPANY

                             as of December 6, 2002

             SUPPLEMENTAL TO THE INDENTURE DATED AS OF JULY 9, 1997

                      ------------------------------------

                              HRPT PROPERTIES TRUST

                              6 1/2% Notes due 2013

<PAGE>
         This SUPPLEMENTAL INDENTURE NO. 11 (this "Supplemental Indenture") made
and  entered  into as of December  6, 2002  between  HRPT  PROPERTIES  TRUST,  a
Maryland real estate investment trust (the "Company"), and STATE STREET BANK AND
TRUST COMPANY, a Massachusetts trust company, as Trustee (the "Trustee"),

                                WITNESSETH THAT:

         WHEREAS,  the Company and the Trustee have  executed  and  delivered an
Indenture, dated as of July 9, 1997 (the "Indenture"), relating to the Company's
issuance, from time to time, of various series of debt securities; and

         WHEREAS,  the Company has determined to issue debt securities  known as
its 6 1/2% Notes due 2013; 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 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.

         "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
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of the Company and its Subsidiaries, (ii) provision for taxes of the Company and
its  Subsidiaries  based on income,  (iii)  amortization  of debt  discount  and
deferred financing costs, (iv) provisions for gains and losses on properties and
property,  depreciation and  amortization,  (v) the effect of any noncash charge
resulting from a change in accounting  principles in  determining  Earnings from
Operations for such period and (vi) amortization of deferred charges.

         "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).

         "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 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.

                                      -2-
<PAGE>

         "Make-Whole  Amount" means, in connection with any optional  redemption
or accelerated  payment of any notes prior to July 15, 2012, 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 July  15,  2012,
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 July 15,
2012,  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
July  15,  2012,  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 6 1/2% Notes due 2013,  issued under this
Supplemental  Indenture and the Indenture,  as amended or supplemented from time
to time.

         "Reinvestment  Rate"  means a rate per annum  equal to the sum of 0.50%
(fifty  one-hundredths of one percent) plus the yield on treasury  securities at
constant  maturity under the 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 July 15, 2012), 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

                                      -3-
<PAGE>
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.

                                   ARTICLE 2

                               TERMS OF THE NOTES

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

         (a) Title;  Aggregate  Principal Amount; Form of Notes. The Notes shall
be Registered Securities under the Indenture and shall be known as the Company's
"6 1/2% Notes due 2013."  The Notes  will be limited to an  aggregate  principal
amount of  $200,000,000,  subject  to the right of the  Company  to reopen  such
series for  issuances  of  additional  securities  of such  series and except as
provided  in  this  Section  and in  Section  306 of the  Indenture.  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.

         The Notes will be issued in the form of one or more  registered  global
securities  without coupons  ("Global Notes") that will be deposited with, or on
behalf of, The Depository Trust Company  ("DTC"),  and registered in the name of
DTC's nominee,  Cede & Co. Except under the  circumstance  described  below, the
Notes will not be issuable in definitive form.  Unless and until it is exchanged
in whole or in part for the individual notes represented  thereby, a Global Note
may not be  transferred  except  as a whole by DTC to a  nominee  of DTC or by a
nominee of DTC to DTC or another  nominee of DTC or by DTC or any nominee of DTC
to a successor depositary or any nominee of such successor.

         So long as DTC or its nominee is the registered owner of a Global Note,
DTC or such nominee,  as the case may be, will be  considered  the sole owner or
holder of the Notes  represented by such Global Note for all purposes under this
Supplemental Indenture. Except as described below, owners of beneficial interest
in Notes  evidenced  by a Global  Note will not be  entitled  to

                                      -4-
<PAGE>

have any of the individual  Notes  represented by such Global Note registered in
their names, will not receive or be entitled to receive physical delivery of any
such Notes in definitive  form and will not be considered  the owners or holders
thereof under the Indenture or this Supplemental Indenture.

         If DTC is at any time  unwilling,  unable or  ineligible to continue as
depositary and a successor  depositary is not appointed by the Company within 90
days, the Company will issue individual Notes in exchange for the Global Note or
Global Notes  representing such Notes. In addition,  the Company may at any time
and in its sole  discretion,  subject  to certain  limitations  set forth in the
Indenture,  determine not to have any of such Notes  represented  by one or more
Global Notes and, in such event, will issue individual Notes in exchange for the
Global Note or Global Notes  representing the Notes.  Individual Notes so issued
will be issued in denominations of $1,000 and integral multiples thereof.

         (b) Interest and Interest  Rate. The Notes will bear interest at a rate
of 6 1/2% per annum, from December 6, 2002 (or, in the case of Notes issued upon
the reopening of this series of Notes,  from the date  designated by the Company
in connection with such reopening) or from the  immediately  preceding  Interest
Payment  Date to which  interest  has been paid or duly  provided  for,  payable
semiannually  on each January 15 and July 15,  commencing July 15, 2003 (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 (whether or not a Business Day) next preceding such
Interest Payment Date (each, a "Regular Record Date").

         (c) Principal Repayment;  Currency. The stated maturity of the Notes is
January 15, 2013,  provided,  however,  the Notes may be earlier redeemed at the
option of the Company as provided in paragraph (d) 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,  located
initially at Two Avenue de Lafayette,  Boston, Massachusetts 02111, 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.

         (d)  Redemption at the Option of the Company;  Acceleration.  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. If the notes are redeemed on or
after July 15,  2012,  the  redemption  price will not  include  the  Make-Whole
Amount. Upon the acceleration of the Notes in accordance with Section 502 of the
Indenture,  if such  acceleration  occurs prior to July 15, 2012,  the principal
amount of the Notes, plus accrued and unpaid interest thereon and the Make-Whole
Amount shall become due and payable immediately.

         (e) 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 Two

                                      -5-
<PAGE>

Avenue de  Lafayette,
Boston,  Massachusetts 02111,  Attention:  Corporate Trust Department,  Re: HRPT
Properties  Trust 6 1/2% Notes due 2013;  or as to either  party,  at such other
address as shall be  designated  by such party in a written  notice to the other
party.

         (f) Global  Note  Legend.  Each  Global  Note shall bear the  following
legend on the face thereof:

         UNLESS THIS CERTIFICATE 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 CERTIFICATE 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.

         (g)  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 3

                              ADDITIONAL COVENANTS

         Section 3.1 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 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

                                      -6-
<PAGE>
         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   limitations   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.

         (b)  Maintenance  of Total  Unencumbered  Assets.  The  Company and its
Subsidiaries  will maintain at all times Total  Unencumbered  Assets of not less
than 200% of the aggregate outstanding principal amount of the Unsecured Debt of
the Company and its Subsidiaries on a consolidated basis.

                                      -7-
<PAGE>

                                   ARTICLE 4

                          ADDITIONAL EVENTS OF DEFAULT

         Section 4.1 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  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 interest,  plus, if
such acceleration occurs prior to July 15, 2012, the Make-Whole Amount.

                                   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.

                                   ARTICLE 6

                                  MISCELLANEOUS

         Section 6.1 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 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.

                                      -8-
<PAGE>

         Section  6.3  This  Supplemental  Indenture  shall be  governed  by and
construed in accordance with the laws of The Commonwealth of Massachusetts.

         Section  6.4 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.

                  [Remainder of page intentionally left blank.]

                                      -9-
<PAGE>

         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.

                                     HRPT PROPERTIES TRUST

                                     By:___________________________
                                        Name:
                                        Title:

                                     STATE STREET BANK AND TRUST COMPANY,
                                     as Trustee

                                     By:___________________________
                                        Name:
                                        Title:

                                      -10-
<PAGE>
                                                                       EXHIBIT A

                                  FORM OF NOTE

                                 [Face of Note]

                              6 1/2% Note due 2013

No. ______                                                         $200,000,000

                              HRPT PROPERTIES TRUST

promises to pay to CEDE & CO. or registered assigns, the principal sum of TWO
HUNDRED MILLION DOLLARS ($200,000,000) on January 15, 2013, 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 January 15 and July 15,  commencing July
         15, 2003.

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

CUSIP No.: 4026W AN1

                                              HRPT PROPERTIES TRUST

                                              By:____________________________
                                                  Name:
                                                  Title:

Attest:____________________________
[SEAL]

                          CERTIFICATE OF AUTHENTICATION

Dated: December 6, 2002

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

                                     STATE STREET BANK AND TRUST COMPANY,
                                     as Trustee

                                     By:_______________________________
                                          Authorized Officer

<PAGE>
             [THE FOLLOWING CONSTITUTES THE REVERSE OF THE SECURITY]

                              HRPT PROPERTIES TRUST

                              6 1/2% Note due 2013

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

         1. Interest.  HRPT 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  6  1/2%.  The  Company  will  pay  interest
semi-annually in arrears on each January 15 and July 15,  commencing on July 15,
2003,  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 has been paid or, if no interest has been paid, from December 6, 2002.

         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 July 9,  1997,  and a  Supplemental  Indenture  No. 11  thereto,  dated as of
December 6, 2002  (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.  The Notes are  subject to all such terms,
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 unsecured
general  obligations  of  the  Company  limited  to  $200,000,000  in  aggregate
principal amount, except as otherwise provided in the Indenture.

         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,  plus accrued and unpaid interest
to but excluding the applicable  Redemption Date and (ii) the Make-Whole Amount,
if any. If the Notes are  redeemed  on or after July 15,  2012,  the  redemption
price will not include the Make-Whole Amount.

                                      A-2
<PAGE>

         As used herein the term  "Make-Whole  Amount" means, in connection with
any optional  redemption or  accelerated  payment of any notes prior to July 15,
2012, 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 July 15,  2012,  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 July 15, 2012, 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 July 15, 2012, 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% (fifty  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 July 15,  2012),  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 Supplemental 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.

         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

                                      A-3
<PAGE>

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 AMENDED AND  RESTATED  DECLARATION  OF
TRUST OF THE  COMPANY,  DATED JULY 1, 1994, A COPY OF WHICH,  TOGETHER  WITH ALL
AMENDMENTS  THERETO  (THE  "DECLARATION"),  IS DULY  FILED IN THE  OFFICE OF THE
DEPARTMENT OF ASSESSMENTS  AND TAXATION OF THE STATE OF MARYLAND,  PROVIDES THAT
THE NAME "HRPT  PROPERTIES  TRUST" REFERS TO THE TRUSTEES UNDER THE  DECLARATION
COLLECTIVELY  AS  TRUSTEES,  BUT NOT

                                      A-4
<PAGE>

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. Request may be made to:

         HRPT Properties Trust
         400 Centre Street
         Newton, MA 02458
         Telecopier No.:  (617) 332-2261
         Attention: President

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

                                      A-5
<PAGE>

                                 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:  _______________

                                     Your Signature: __________________________
                                     [Sign exactly as your name appears on the
                                     face of this Note]

Signature Guarantee:

_______________________________________
[The signature must be guaranteed by
an officer of a participant in a recognized
signature guarantee program. Notarized
or witnessed signatures are not acceptable.]

                                      A-6<PAGE>

                                                                    Exhibit 10.1

                               ADVISORY AGREEMENT

                                     BETWEEN

                          APPLE HOSPITALITY FIVE, INC.

                                       AND

                      APPLE HOSPITALITY FIVE ADVISORS, INC.

         THIS ADVISORY AGREEMENT, dated as of December __, 2002, is between
APPLE HOSPITALITY FIVE, INC., a Virginia corporation (the "Company"), and APPLE
HOSPITALITY FIVE ADVISORS, INC., a Virginia corporation (the "Advisor").

                                    RECITALS

         A.  The purpose of the Company is to invest primarily in upper-end,
extended-stay hotel properties in selected metropolitan areas of the United
States and, to a lesser extent, in certain other permitted investments described
in the Prospectus (as hereinafter defined). The Company intends to qualify as a
real estate investment trust pursuant to Sections 856 through 860 of the
Internal Revenue Code of 1986, as amended.

         B.  The Company desires to engage the Advisor to provide information,
advice, assistance and facilities to the Company and to have the Advisor
undertake the duties and responsibilities hereinafter set forth, all subject to
the supervision of the Company's Board of Directors, on the terms and conditions
set forth herein. In consideration therefor, the Company desires to pay the
Advisor certain fees as herein set forth.

         NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements contained herein, the parties agree as follows:

<PAGE>

     1.   Definitions. For purposes of this Agreement, the following terms shall
have the meanings set forth below.

          (a) "Affiliate" means (i) any Person directly or indirectly
     controlling, controlled by or under common control with another Person,
     (ii) any Person owning or controlling 10% or more of the outstanding voting
     securities or beneficial interests of such other Person, (iii) any officer,
     director, trustee or general partner of such Person and (iv) if such other
     Person is an officer, director, trustee or partner of another entity, then
     the entity for which that Person acts in any such capacity. "Affiliated"
     means being an Affiliate of a specified Person.

          (b) "Articles of Incorporation" means the Company's Articles of
     Incorporation filed with the Virginia State Corporation Commission,
     including all amendments, restatements or modifications thereof.

          (c) "Asset Management Fee" means the fee payable to the Advisor for
     its services hereunder. Such fee will be paid pursuant and subject to
     Section 11 of this Agreement.

          (d) "Average Invested Assets" for any period means the average of the
     aggregate book value of the assets of the Company invested, directly or
     indirectly, in equity interests in and loans secured by real estate, before
     reserves for depreciation or bad debts or other similar non-cash reserves,
     computed by taking the average of such values at the end of each month
     during such period.

          (e) "Board of Directors" means the Company's Board of Directors as of
     any particular time.

          (f) "Bylaws" means the Company's Bylaws, including all amendments,
     restatements or modifications thereof.

          (g) "Calendar Year" means the year ended December 31st and any portion
     thereof treated by the Internal Revenue Service as a reporting period for
     the Company.

          (h) "Code" means the Internal Revenue Code of 1986, as amended from
     time to time, including successor statutes thereto.

          (i) "Company Net Income" for any period means the total revenues of
     the Company for such period, less expenses applicable to such period other
     than additions to reserves for depreciation or bad debts or other similar
     non-cash reserves. "Company Net Income," for purposes of calculating
     Operating Expenses in Section 15 of this Agreement, does not include the
     gain from the sale of the Company's assets.

          (j) "Directors" means, as of any particular time, the directors of the
     Company holding office at such time.

                                       2

<PAGE>

          (k) "Independent Director" means a Director of the Company who is not
     Affiliated, directly or indirectly, with the Advisor, whether by ownership
     of, ownership interest in, employment by, any material business or
     professional relationship with, or serving as an officer or director of,
     the Advisor, or an Affiliated business entity of the Advisor (other than as
     an Independent Director of up to three other real estate investment trusts
     advised by the Advisor or an Affiliate of the Advisor). An Independent
     Director may perform no other services for the Company, except as a
     Director. Notwithstanding anything to the contrary herein, any member of a
     law firm whose only material business or professional relationship with the
     Company, the Advisor and their Affiliates is as legal counsel to any of
     such entities shall constitute an Independent Director (unless such person
     serves as a director for more than three real estate investment trusts
     organized by the Advisor and its Affiliates). An "indirect" affiliation
     shall be deemed to refer to circumstances in which a member of the
     "immediate family" of a Director is Affiliated with the Advisor, and a
     person's "immediate family" shall mean such person's spouse, parents,
     children, siblings, mother and father-in-law, sons and daughters-in-law and
     brothers and sisters-in-law.

          (l) "Modified Net Income" means net income (computed in accordance
     with generally accepted accounting principles) excluding gains (or losses)
     from debt restructuring and sales of property, plus depreciation of real
     property, and after adjustments for significant non-recurring items and
     unconsolidated partnerships and joint ventures. Adjustments for
     unconsolidated partnerships and joint ventures will be calculated to
     reflect modified net income on the same basis.

          (m) "Offering" means the public offering of the Company's Common
     Shares.

          (n) "Operating Expenses" means all operating, general and
     administrative expenses of the Company as determined under generally
     accepted accounting principles (including regular compensation payable to
     the Advisor), excluding, however, the following:

              (i)    expenses of raising capital;

              (ii)   interest payments;

              (iii)  taxes;

              (iv)   non-cash expenditures, such as depreciation, amortization
          and bad debt;

              (v)    reserves;

              (vi)   incentive fees paid to the Advisor, if any; and

              (vii)  costs related directly to asset acquisition, operation a
          disposition.

                                       3

<PAGE>

          (o) "Organizational and Offering Expenses" means all expenses incurred
     in connection with the formation and registration of the Company and in
     qualifying and marketing the Shares under applicable federal and state law,
     and any other expenses actually incurred and directly related to the
     qualification, registration, offer and sale of the Shares, including such
     expenses as (i) all marketing expenses and payments made to broker-dealers
     as compensation or reimbursement for all costs of reviewing the Offering,
     including due diligence investigations and fees and expenses of their
     attorneys, accountants and other experts; (ii) registration fees, filing
     fees and taxes; (iii) the costs of printing, amending, supplementing and
     distributing the registration statement and Prospectus; (iv) the costs of
     obtaining regulatory clearances of, and printing and distributing, sales
     materials used in connection with the offer and sale of the Shares; (v) the
     costs related to investor and broker-dealer sales meetings concerning the
     Offering; and (vi) accounting and legal fees incurred in connection with
     any of the foregoing.

          (p) "Person" includes an individual, corporation, partnership, joint
     venture, association, company, trust, bank or other entity, or government
     and any agency and political subdivision of a government.

          (q) "Property" or "Properties" means partial or entire equity
     interests, including equity participation interests such as general
     partnership interests and joint venture interests, owned by the Company in
     real property as described in the Prospectus.

          (r) "Prospectus" has the meaning given to that term by Section 2(10)
     of the Securities Act of 1933, as amended, and as used herein, the term
     means the Prospectus of the Company pursuant to which the Shares are
     offered to the public.

          (s) "Return Ratio" means, for any period, the ratio of Modified Net
     Income to Total Contributions.

          (t) "Shares" or "Common Shares" means the Common Shares of the
     Company, no par value, and the Series A Preferred Shares of the Company,
     which are collectively being offered as "Units" pursuant to the Company's
     Prospectus.

          (u) "Shareholders" means the holders of record of the Company's Common
     Shares.

          (v) "Total Contributions" means the gross offering proceeds which have
     been received by the Company from time to time from the sale or sales of
     the Shares. Total Contributions shall be calculated to reflect the average
     of the daily amounts during the period in question of the gross offering
     proceeds which have been received by the Company from time to time from the
     sales of Shares, to extent such Shares are issued and such sales have
     actually been closed.

     2.   Duties of the Advisor. Subject to the terms of the Articles of
Incorporation, the Bylaws, and the supervision of the Board of Directors, the
Advisor, at its own cost and expense, unless otherwise set forth herein, on
behalf of the Company, shall:

                                       4

<PAGE>

          (a) serve as the Company's investment advisor and consultant in
     connection with policy and investment decisions to be made by the Board of
     Directors, furnish reports to the Board of Directors, and provide research,
     economic and statistical data in connection with the acquisition,
     financing, refinancing, holding, leasing and disposition of Properties and
     other investments of the Company;

          (b) administer the day-to-day operations of the Company and perform or
     supervise the various administrative functions reasonably necessary for the
     management of the Company;

          (c) investigate, select and, on behalf of the Company, engage and
     conduct business with (including, but not limited to, entering into
     contracts in the name of the Advisor or the Company) consultants,
     accountants, correspondents, lenders, servicers, technical advisors,
     attorneys, brokers, underwriters, corporate fiduciaries, escrow agents,
     depositaries, custodians, agents for collection, insurers, insurance
     agents, banks, builders, developers, property owners, mortgagors, and other
     mortgage and investment participants, any and all agents for any of the
     foregoing, including Affiliates of the Advisor, and Persons acting in any
     other capacity deemed by the Board of Directors necessary or desirable for
     the performance of any of the foregoing services;

          (d) act as attorney-in-fact or agent in acquiring, financing,
     refinancing, leasing and disposing of Properties and other investments, in
     disbursing and collecting funds of the Company, in paying the debts and
     fulfilling the obligations of the Company and in handling, prosecuting and
     settling any claims of the Company, including the foreclosure or other
     enforcement of any mortgage or other lien securing Properties or other
     investments, and exercise its own discretion in doing so; provided that any
     fees and costs payable to independent Persons incurred by the Advisor in
     connection with the foregoing shall be the responsibility of the Company;

          (e) negotiate on behalf of the Company with banks or other lenders for
     loans to be made to the Company, and negotiate on behalf of the Company
     with investment banking firms and broker-dealers or negotiate private sales
     of the securities of the Company or obtain loans for the Company, but in no
     event in such a way so that the Advisor shall be acting as broker-dealer or
     underwriter; and provided, further, that any fees and costs payable to
     third parties incurred by the Advisor in connection with the foregoing
     shall be the responsibility of the Company;

          (f) invest or reinvest any money of the Company, as directed by the
     Board of Directors or subject to such discretionary powers as the Board of
     Directors may from time to time delegate;

          (g) if requested by the Company, provide appraisal reports on any real
     property that is, or is proposed to be, acquired by the Company for
     investment;

          (h) at any time reasonably requested by the Board of Directors (but
     not more than monthly) make reports of its performance of services to the
     Company;

                                        5

<PAGE>

          (i) communicate on behalf of the Company with the Shareholders of the
     Company as required to satisfy the continuous reporting and other
     requirements of any governmental bodies or agencies to the Shareholders and
     third parties and to maintain effective relations with the Shareholders;

          (j) counsel the Company in connection with policy decisions to be made
     by the Board of Directors;

          (k) provide the executive and administrative personnel, office space
     and services required in rendering the foregoing services to the Company;
     and

          (l) perform such other services as may be required from time to time
     for management and other activities relating to the assets of the Company
     as the Advisor shall deem appropriate under the particular circumstances.

     3.   Commitments. In order to meet the investment requirements of the
Company, but only as determined by the Board of Directors, or any authorized
committee thereof, from time to time, the Advisor agrees at the direction of the
Board of Directors or any such committee to issue on behalf of the Company
commitments on such terms as are established by the Board of Directors or any
such committee, for the acquiring of Properties or other assets.

     4.   Duties of the Board of Directors. In order for the Advisor to fulfill
its duties, the Board of Directors shall, to the extent it deems proper, provide
the Advisor with full information concerning the Company, its capitalization and
investment policies and the intentions of the Board of Directors with respect to
future investments. The Company shall furnish the Advisor with a copy of all
audited financial statements, a signed copy of each report prepared by
independent accountants, and such other information with regard to its affairs
as the Advisor may from time to time reasonably request.

     5.   Advice. In addition to the services described in Section 2 above, the
Advisor shall consult with the Board of Directors and the officers of the
Company and shall furnish them with advice and recommendations with respect to
the acquiring of Properties or commitments therefor, or other investments of, or
investments considered by, the Company, and shall furnish advice and
recommendations with respect to other aspects of the business and affairs of the
Company. In order to facilitate the investment of the funds of the Company and
enable it to avail itself of investment opportunities as they arise, the Advisor
may from time to time be granted, but is not hereby granted, the power and
authority to make and dispose of investments and to make and terminate
commitments for investments, on behalf of and in the name of the Company,
without further or express authority from the Board of Directors; provided,
however that the Board of Directors shall have the power to revoke, suspend,
modify or limit such power and authority at any time or from time to time, but
not retroactively. Unless otherwise notified by the Board of Directors, a
representative of the Advisor shall attend all regular and special meetings of
the Board of Directors, and the Board of Directors shall notify the Advisor of
such meetings.

                                       6

<PAGE>

     6.   Bank Accounts. The Advisor may establish and maintain one or more bank
accounts in the name of the Company and may collect and deposit into any such
account or accounts, and disburse from any such account or accounts, any money
on behalf of the Company, under such terms and conditions as the Board of
Directors may approve, provided that all such accounts shall be maintained in
such fashion as to make clear that the funds therein are the property of the
Company and not of the Advisor. The Advisor shall from time to time render
appropriate accountings of such collections and payments to the Board of
Directors and to the auditors of the Company.

     7.   Investment Undertakings. The Advisor shall use its best efforts to
assure that (i) any mortgage securing a Property of the Company shall be and
remain a valid lien upon the mortgaged property according to its terms; (ii) the
title to any Property is insured by appropriate policies of title insurance;
(iii) any Property is duly insured against loss or damage by fire, with extended
coverage, and against such other insurable hazards and risks as is customary and
appropriate in the circumstances; and (iv) the policies from time to time
specified by the Board of Directors with regard to the protection of the
Company's investments are carried out. Any and all fees and costs incurred by
the Advisor in performing such functions, whether payable to its Affiliates or
independent Persons shall be borne by the Company.

     8.   Records; Confidentiality. The Advisor shall maintain appropriate
records of all its activities hereunder and make such records available for
inspection by the Board of Directors and by counsel, auditors and authorized
agents of the Company, at any time or from time to time during normal business
hours. The Advisor shall at all reasonable times have access to the books and
records of the Company. The Advisor shall keep confidential any and all
information obtained in connection with the services rendered hereunder and
shall not disclose any such information to nonaffiliated Persons except with the
prior consent of the Board.

     9.   Limitation of Activities. Anything else in this Agreement to the
contrary notwithstanding:

          (a) The Advisor shall refrain from taking any action which, in its
     sole judgment made in good faith, would adversely affect the status of the
     Company as a real estate investment trust as defined in the Code, subject
     the Company to regulation under the Investment Company Act of 1940, violate
     any law, rule or regulation or would otherwise not be permitted by the
     Articles of Incorporation or Bylaws of the Company, except if such action
     shall be ordered by the Board of Directors, in which case the Advisor shall
     notify promptly the Board of Directors of the Advisor's judgment of the
     potential impact of such action and shall refrain from taking such action
     until it receives further clarification or instructions from the Board of
     Directors. Notwithstanding the foregoing, the Advisor and its stockholders,
     directors, officers and employees shall not be liable to the Company, or to
     the Company's Board of Directors or Shareholders for any act or omission by
     the Advisor, or its stockholders, directors, officers or employees except
     as provided in Section 16 of this Agreement.

          (b) In performing its duties and obligations under this Agreement, the
     Advisor shall abide by and comply with the provisions and policies set
     forth in the Articles of Incorporation and Bylaws.

                                       7

<PAGE>

     10.  Relationship with Board of Directors. Employees of the Advisor may
serve as members of the Board of Directors or any committee thereof and as
officers of the Company, except that no employee of the Advisor who also is a
Director or officer of the Company shall receive any compensation from the
Company for serving as a Director or officer other than for reasonable
reimbursement for travel and related expenses incurred in attending meetings of
the Board of Directors or any committee thereof.

     11.  Fees.

          (a)  Asset Management Fee. The Company shall pay to the Advisor
     quarterly, for services rendered under this Agreement, an Asset Management
     Fee calculated as follows: The Asset Management Fee for any calendar
     quarter shall be a applicable percentage of the Total Contributions. The
     applicable percentage used to calculate such Asset Management Fee shall be
     based upon the Return Ratio, calculated on a per annum basis, for the
     preceding calendar quarter. The Asset Management Fee shall be as follows
     with respect to any such quarter: 0.1% of Total Contributions if the Return
     Ratio for the preceding calendar quarter is 6.0% per annum or less; 0.15%
     of Total Contributions if the Return Ratio for the preceding calendar
     quarter is more than 6.0% per annum but not more than 8.0% per annum; and
     0.25% of Total Contributions if the Return Ratio for the preceding calendar
     is above 8.0% per annum. If the Asset Management Fee is payable with
     respect to any partial calendar quarter, it shall be prorated based on the
     number of days elapsed during any such partial calendar quarter.

          (b)  Payment of Asset Management Fee. The Advisor shall compute the
     compensation payable to it under Section 11(a) of this Agreement within 45
     days of the end of each calendar quarter. A copy of the computations made
     by the Advisor to calculate its compensation shall thereafter promptly be
     delivered to the Board of Directors and, upon such delivery, payment of the
     compensation earned under Section 11(a) of this Agreement shown therein
     shall be due and payable within 60 days after the end of such calendar
     quarter.

     12.  Expenses.

          (a)  The Company shall pay directly or reimburse the Advisor for the
     following expenses in addition to the compensation provided for in this
     Agreement:

               (i)   all costs of personnel employed by the Company and involved
          in the business of the Company;

               (ii)  expenses incurred in connection with the initial investment
          of the funds of the Company, including all direct expenses incurred in
          connection with investigation and acquisition of Properties;

               (iii) interest and other costs for borrowed money, including
          discounts, points and other similar fees;

               (iv)  taxes and assessments on income or property and taxes as an
          expense of doing business;

                                       8

<PAGE>

               (v)    fees and commissions, including finder's fees and
          brokerage commissions with respect to the acquisition and disposition
          of assets of the Company, whether payable to an Affiliate of the
          Advisor or an unrelated Person, including, without limitation, costs
          of foreclosure, maintenance, repair and improvement of Property;

               (vi)   costs associated with insurance required in connection
          with the business of the Company or by the Board of Directors;

               (vii)  expenses of managing and operating real property owned by
          the Company, whether payable to an Affiliate of the Advisor or an
          unrelated Person;

               (viii) fees and expenses of legal counsel for the Company;

               (ix)   fees and expenses of independent auditors and accountants
          for the Company;

               (x)    all expenses in connection with payments to the Board of
          Directors or any committee thereof and meetings of the Board of
          Directors or any committee thereof and Shareholders;

               (xi)   expenses associated with listing the Shares on a national
          stock exchange or quoting the Shares on the NASDAQ National Market
          System if requested by the Board of Directors, or with the issuance
          and distribution of any additional Shares of the Company at any time,
          such as taxes, legal and accounting fees, listing and registration
          fees, and other expenses;

               (xii)  dividend and dividend distributions;

               (xiii) expenses of organizing, revising, amending, converting,
          modifying or terminating the Company, the Articles of Incorporation or
          the Bylaws; and

               (xiv)  expenses of maintaining communications with Shareholders,
          including the cost of preparation, printing, and mailing annual
          reports and other Shareholder reports, proxy statements and other
          reports required by governmental entities.

          Expenses incurred by the Advisor on behalf of the Company and payable
pursuant to this Section, shall be reimbursed quarterly to the Advisor within 60
days after the end of each quarter. The Advisor shall prepare a statement
documenting the expenses of the Company during each quarter, and shall deliver
such statement to the Company within 45 days after the end of each quarter.

          (b)  Except as otherwise provided herein, the Advisor shall pay all
     expenses of performing its obligations under this Agreement, including,
     without limitation, the following expenses:

                                       9

<PAGE>

               (i)   employment expenses of the Advisor, including, but not
          limited to, salaries, wages, payroll taxes, costs of employee benefit
          plans, and temporary help expenses, except to the extent that such
          expenses are otherwise reimbursable pursuant to Section 12(a) of this
          Agreement or the Articles of Incorporation or Bylaws;

               (ii)  audit fees and expenses of the Advisor;

               (iii) legal fees and other expenses of professional services to
          the Advisor;

               (iv)  rent, telephone, utilities and other office expenses of the
          Advisor;

               (v)   insurance of the Advisor; and

               (vi)  all other administrative expenses of the Advisor.

     13.  Limitation on the Advisor's Investment Advice. Notwithstanding
anything to the contrary in this Agreement, the Advisor shall not be required
to, and shall not, advise the Company as to any investments in securities,
except when, and to the extent that, the Advisor and the Company specifically
agree (i) that such advice is desirable, and (ii) that such advice can be
rendered consistently with applicable legal requirements, including any
applicable provisions of relevant "investment advisor" laws.

     14.  Other Services. Should the Board of Directors request that the Advisor
or any employee thereof render material services for the Company other than set
forth in Section 2, such services shall be separately compensated and shall not
be deemed to be services pursuant to the terms of this Agreement.

     15.  Limitation on Operating Expenses. Within 120 days from the end of any
Calendar Year, the Advisor shall refund to the Company the amount, if any, by
which the Operating Expenses of the Company, excluding extraordinary
nonrecurring items and those items referred to in Section 14, during such
Calendar Year exceeded the greater of either of the following limitations:

          (a)  2% of the Average Invested Assets of the Company for such
     Calendar Year; or

          (b)  25% of the Company's Company Net Income for such Calendar Year,
     determined in accordance with generally accepted accounting principles.

          The Independent Directors of the Company may determine that, because
of unusual and nonrecurring factors which they deem sufficient, a higher level
of Operating Expenses is justified for such Calendar Year. The Advisor shall be
promptly reimbursed for any payments made under this Section 15 if, in any
succeeding Calendar Year, the Operating Expenses of the Company are less than
the permitted level of Operating Expenses.

                                       10

<PAGE>

     16.  Advisory Responsibility. The Advisor assumes no responsibility under
this Agreement other than to render the services called for hereunder in good
faith and with integrity, and shall not be responsible for any action of the
Company in following or declining to follow any advice or recommendation of the
Advisor. Neither the Advisor, its shareholders, directors, officers nor
employees nor any of its Affiliates, nor any Person contracting with the Advisor
for services and its shareholders, directors, officers and employees nor any of
its Affiliates shall be liable to the Company or its Shareholders, except by
reason of acts constituting gross negligence or willful misconduct. The Advisor
hereby agrees to look solely to the assets of the Company for satisfaction of
all claims against the Company, and in no event shall any Shareholder, Director,
officer or agent of the Company have any personal liability for the obligation
of the Company under this Agreement.

     17.  Incorporation of the Articles of Incorporation and Bylaws. To the
extent the Articles of Incorporation and Bylaws impose obligations or
restrictions on the Advisor or grant the Advisor certain rights which are not
set forth in this Agreement, the Advisor shall abide by such obligations or
restrictions and such rights shall inure to the benefit of the Advisor with the
same force and effect as if they were set forth herein.

     18.  Fiduciary Duty and Indemnification. Subject to Section 16, the Advisor
shall have a fiduciary relationship to the Shareholders. However, the Company
shall indemnify the Advisor, to the fullest extent permitted by law, for its
liabilities and losses arising from the operations of the Company (including its
costs and expenses, including legal fees and expenses, incurred in connection
with investigating and defending itself against such liabilities and losses) if
the following conditions are met:

          (a)  the Directors have determined, in good faith, that the course of
     conduct which caused the liability or loss was undertaken in good faith
     within what the Advisor reasonably believed to be the scope of its
     employment or authority and for a purpose which it reasonably believed to
     be in the best interests of the Company;

          (b)  the Directors have determined, in good faith, that the liability
     or loss was not the result of willful misconduct, bad faith, reckless
     disregard of duties or violation of the criminal law on the part of the
     Advisor; and

          (c)  the indemnified amount is recoverable only out of the assets of
     the Company and not from the Shareholders.

          Notwithstanding the foregoing, indemnification will not be allowed for
any liability imposed by judgment, and costs associated therewith, including
attorneys' fees, arising from or out of a violation of state or federal
securities laws associated with the Offering of the Common Shares unless (i)
there has been a successful adjudication on the merits of each count involving
alleged securities laws violations as to the particular indemnitee, or (ii) such
claims have been dismissed with prejudice on the merits by a court of competent
jurisdiction as to the particular indemnitee or (iii) a court of competent
jurisdiction approves a settlement of the claims against a particular
indemnitee.

                                       11

<PAGE>

     19.  Transactions between the Advisor and the Company. All transactions
between the Advisor and the Company shall require the approval by a majority of
the Directors (including a majority of the Independent Directors) and shall
otherwise comply with the conflict of interest provisions of the Bylaws.

     20.  Relationship of Advisor and Company. The Company and the Advisor are
not partners or joint ventures with each other, and nothing herein shall be
construed to make them such partners or joint ventures or impose any liability
as such on either of them.

     21.  Other Activities. Except as otherwise expressly provided herein,
nothing contained herein shall limit the right of the Advisor or any of its
officers, directors or employees, whether or not a Director, officer or employee
of the Company, to engage in other business activities or to render services of
any kind to any other Person even if such other business activities or services
may be in direct competition with the Company.

     22.  Term; Termination of Agreement.

          (a)  This Agreement shall have an initial term ending five years after
     April 30, 2001, and thereafter shall be renewed for additional two-year
     terms upon the consent of the Directors.

          (b)  Prior to any renewal of this Agreement, the Independent Directors
     shall review (i) the performance of the Advisor hereunder to determine its
     compliance with the provisions of this Agreement, and (ii) the fees payable
     to the Advisor hereunder to determine whether they are reasonable in
     relation to the nature and quality of services performed. The findings of
     the Independent Directors shall be recorded in the minutes of the
     Directors.

          (c)  This Agreement shall be terminable (i) without cause by the
     Advisor or (ii) without cause by a majority of the Independent Directors,
     in each case upon 60 days' prior written notice to the non-terminating
     party.

          (d)  In the event of the termination of the Advisor, the Advisor will
     cooperate with the Company and take all reasonable steps requested to
     assist the Directors in making an orderly transition of the advisory
     function to another Person.

          (e)  At the sole option of a majority of the Independent Directors,
     this Agreement may be terminated for cause by written notice of termination
     from the Company to the Advisor if any of the following events occur:

               (i)  if the Advisor shall violate or default in the performance
          of any material provision of this Agreement and, after written notice
          of such violation or default, shall not cure such violation or default
          within 30 days;

               (ii) if the Advisor shall be adjudged bankrupt or insolvent by a
          court of competent jurisdiction, or an order shall be made by a court
          of competent jurisdiction for the appointment of a receiver,
          liquidator or trustee of the Advisor, or of all or substantially all
          of its property by reason of the foregoing, or

                                       12

<PAGE>

          approving any petition filed against the Advisor for reorganization,
          and such adjudication or order shall remain in force or unstayed for a
          period of 30 days; or

               (iii) if the Advisor shall institute proceedings for voluntary
          bankruptcy or shall file a petition seeking reorganization under the
          federal bankruptcy laws, or for relief under any law for relief of
          debtors, or shall consent to the appointment of a receiver for itself
          or for all or substantially all of its property, or shall make a
          general assignment for the benefit of its creditors, or shall admit in
          writing its inability to pay its debts, generally, as they become due.

          (f)  Any notice of termination under this Section shall (except to the
     extent this Section requires a different notice period) be effective on the
     date specified in such notice, which may be the day on which such notice is
     given or any date thereafter. The Advisor agrees that if any of the events
     specified in subparagraph (ii) or (iii) of Section 22(e) shall occur, it
     shall give written notice thereof to the Board of Directors within 5 days
     after the occurrence of such event.

     23.  Action Upon Termination.

          (a)  From and after the effective date of termination of this
     Agreement pursuant to Section 22 hereof, the Advisor shall not be entitled
     to compensation for further services rendered hereunder, but shall be
     entitled to receive from the Company within 30 days after the effective
     date of such termination, an amount in cash equal to all earned but unpaid
     Asset Management Fees payable to the Advisor prior to the termination of
     this Agreement.

          (b)  Within a reasonable period of time, but in no event later than 30
     days after the termination of this Agreement, the Advisor shall:

               (i)   pay over to the Company all money collected and held for
          the account of the Company pursuant to this Agreement, after deducting
          any accrued compensation and reimbursement for its expenses to which
          it is then entitled;

               (ii)  deliver to the Board of Directors a full accounting,
          including a statement showing all payments collected by it and a
          statement of all money held by it, covering the period following the
          date of the last accounting furnished to the Board of Directors; and

               (iii) deliver to the Board of Directors all property and
          documents of the Company then in the custody of the Advisor.

          The Advisor shall be entitled to receive, promptly after such 30-day
period, reimbursement for any additional expenses to which it is entitled (and
for which it has not been reimbursed under clause (i) of Section 23(b)).

                                       13

<PAGE>

     24.  Assignment. This Agreement may be assigned by the Advisor with the
approval of a majority of the Board of Directors; provided, however, that such
approval shall not be required in the case of an assignment to a corporation,
association, trust or organization which may take over the assets and carry on
the affairs of the Advisor, provided that at the time of such assignment, such
successor organization shall be owned substantially by the Advisor or its
Affiliates and that an officer of the Advisor shall deliver to the Board of
Directors a statement in writing indicating the ownership structure of the
successor organization. Such an assignment shall bind the assignees hereunder in
the same manner as the Advisor is bound hereunder and the assignee shall be
entitled to any and all rights under this Agreement, including those set forth
in section 18. Upon assignment of this Agreement, the Advisor shall be
discharged from its future duties and shall not be entitled to any of the rights
granted under this Agreement. This Agreement shall not be assigned by the
Company without the consent of the Advisor, except in the case of an assignment
by the Company to a corporation or other organization which is a successor to
the Company, in which case such successor organization shall be bound hereunder
and by the terms of said assignment in the same manner as the Company is bound
hereunder.

     25.  Bylaws. The execution and performance of this Agreement hereby is
expressly made subject to Article VIII of the Bylaws of the Company.

     26.  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 to the addresses set
forth herein:

To the Board of Directors or to the Company:

          Apple Hospitality Five, Inc.
          10 South Third Street
          Richmond, Virginia 23219
          Attn: Board of Directors

To the Advisor:

          Apple Hospitality Five Advisors, Inc.
          10 South Third Street
          Richmond, Virginia 23219
          Attn: Glade M. Knight

Either party may at any time give notice in writing to the other party of a
change in its address for the purposes of this Section.

     27.  Modification. This Agreement shall not be changed, modified, amended,
terminated or discharged, in whole or in part, except by an instrument in
writing signed by both parties hereto, or their respective successors or
assigns.

                                       14

<PAGE>

     28.  Shareholder Liability. No Shareholder of the Company shall be
personally liable for any of the obligations of the Company under this
Agreement.

     29. Severability. The provisions of this Agreement are independent of and
severable from each other, and no provision shall be affected or rendered
invalid or unenforceable by virtue of the fact that for any reason any other or
others of them may be invalid or unenforceable in whole or in part.

     30. Binding. This Agreement shall bind any successors or permitted assigns
of the parties hereto as herein provided.

     31. Construction. The provisions of this Agreement shall be construed and
interpreted in accordance with the laws of the Commonwealth of Virginia.

     32. Entire Agreement. This Agreement contains the entire agreement and
understanding among the parties hereto with respect to the subject matter
hereof, and supersedes all prior and contemporaneous agreements, understandings,
inducements and conditions, express or implied, oral or written, of any nature
whatsoever with respect to the subject matter hereof. The express terms hereof
control and supersede any course of performance and/or usage of the trade
inconsistent with any of the terms hereof.

     33. Indulgences, Not Waivers. Neither the failure nor any delay on the part
of a party to exercise any right, remedy, power or privilege under this
Agreement shall operate as a waiver thereof, nor shall any single or partial
exercise of any right, remedy, power or privilege preclude any other or further
exercise of the same or of any other right, remedy, power or privilege, nor
shall any waiver of any right, remedy, power or privilege with respect to any
occurrence be construed as a waiver of such right, remedy, power or privilege
with respect to any other occurrence. No waiver shall be effective unless it is
in writing and is signed by the party asserted to have granted such waiver.

     34. Gender. Words used herein regardless of the number and gender
specifically used, shall be deemed and construed to include any other number,
singular or plural, and any other gender, masculine, feminine or neuter, as the
context requires.

     35. Titles Not to Affect Interpretation. The titles of sections and
subsections contained in this Agreement are for convenience only, and they
neither form a part of this Agreement nor are they to be used in the
construction or interpretation hereof.

     36. Execution in Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original as against any
party whose signature appears thereon, and all of which shall together
constitute one and the same instrument. This Agreement shall become binding when
one or more counterparts hereof, individually or taken together, shall bear the
signatures of all of the parties reflected hereon as the signatories.

                                       15

<PAGE>

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement by
their duly authorized officers as of the date first written above.

                                     APPLE HOSPITALITY FIVE, INC.
                                     a Virginia corporation

                                     By:    _________________________________
                                     Title: Glade M. Knight, President

                                     APPLE HOSPITALITY FIVE ADVISORS, INC.,
                                     a Virginia corporation

                                     By:    _________________________________
                                     Title: Glade M. Knight, President

                                       16

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