-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, O6tqntY29uOnjcEDJ2lMFoLHsSUPw4nn65meh7Z4t2yap6bormx2FJtCcRHLsN98 ria3Ek8KNahP7KV8UfAN+w== 0000908737-04-000968.txt : 20041213 0000908737-04-000968.hdr.sgml : 20041213 20041213171118 ACCESSION NUMBER: 0000908737-04-000968 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20041213 ITEM INFORMATION: Other Events ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20041213 DATE AS OF CHANGE: 20041213 FILER: COMPANY DATA: COMPANY CONFORMED NAME: HOSPITALITY PROPERTIES TRUST CENTRAL INDEX KEY: 0000945394 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 043262075 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-11527 FILM NUMBER: 041199492 BUSINESS ADDRESS: STREET 1: 400 CENTRE ST CITY: NEWTON STATE: MA ZIP: 02158 BUSINESS PHONE: 6179648389 MAIL ADDRESS: STREET 1: 400 CENTRE STREET CITY: NEWTON STATE: MA ZIP: 02158 8-K 1 hpt8k_dec13.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): December 13, 2004 Commission File Number 1-11527 HOSPITALITY PROPERTIES TRUST Maryland 04-3262075 - ----------------------------------- ------------------------------------- (State of Organization) (IRS Employer Identification No.) 400 Centre Street, Newton, Massachusetts 02458 617-964-8389 Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: | | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) - -------------------------------------------------------------------------------- ITEM 8.01. OTHER EVENTS (a) CHANGE OF TRANSFER AGENT On December 13, 2004, we changed the transfer agent for our shares of beneficial interest from EquiServe Trust Company, N.A. to Wells Fargo Bank, National Association, or Wells Fargo. Wells Fargo now serves as our transfer agent, registrar and dividend disbursing agent and also acts as plan administrator of our Dividend Reinvestment and Cash Purchase Plan. In connection with the change, we amended our Dividend Reinvestment and Cash Purchase Plan in certain respects. A copy of the current Dividend Reinvestment and Cash Purchase Plan is furnished attached to this Report as Exhibit 99.1. Additionally, Wells Fargo now is successor Rights Agent under the Rights Agreement, dated May 20, 1997, relating to our shareholder protection rights plan. (b) SUPPLEMENTARY FEDERAL INCOME TAX CONSIDERATIONS The following summary of federal income tax considerations supplements and updates the more detailed description of these matters appearing under the caption "Federal Income Tax Considerations" of Item 1 of our Annual Report on Form 10-K for the year ended December 31, 2003 (our "Annual Report"). Sullivan & Worcester LLP, Boston, Massachusetts, has rendered a legal opinion that the discussion in the portion of our Annual Report captioned "Federal Income Tax Considerations", as supplemented by the discussion in this Report, is accurate in all material respects and fairly summarizes the federal income tax issues discussed in those sections, and the opinion of counsel referred to in such portion of our Annual Report, as supplemented by the discussion in this Report, represents Sullivan & Worcester LLP's opinion on those subjects. Specifically, subject to qualifications and assumptions contained in its opinion, in our Annual Report and in this Report, Sullivan & Worcester LLP has given us an opinion to the effect that we have been organized and have qualified as a REIT under the Internal Revenue Code of 1986, as amended (the "IRC"), for our 1995 through 2003 taxable years, and that our current investments and plan of operation will enable us to continue to meet the requirements for qualification and taxation as a REIT under the IRC. On October 22, 2004, the American Jobs Creation Act of 2004 (the "2004 Act") became law. The 2004 Act, which is generally effective for taxable years beginning in 2005, contains a number of provisions applicable to REITs. These provisions make it easier for REITs to satisfy some of the income tests and asset tests more particularly described in our Annual Report, and to prevent terminations of REIT status due to inadvertent violations of technical tax requirements. Significant REIT provisions of the 2004 Act are summarized below. The 2004 Act expands, for purposes of the 10% asset value test described in our Annual Report, the "straight debt" securities safe harbor to include, on a retroactive basis, among other items (a) certain rental agreements in which payment is to be made in subsequent years, (b) any obligation to pay rents from real property, (c) securities issued by governmental entities that are not dependent in whole or in part on the profits of or payments from a nongovernmental entity, and (d) any security issued by another REIT. The 2004 Act excludes from the 95% gross income test described in our Annual Report any income arising from "clearly identified" hedging transactions that are entered into by a REIT, or certain subsidiary entities, to manage interest rate, price, or currency fluctuations with respect to borrowings incurred or to be incurred by the REIT to acquire or carry real estate assets. In general, for a hedging transaction to be "clearly identified" (a) the transaction must be 2 identified as a hedging transaction before the end of the day on which it is entered and (b) the risks being hedged must be identified generally within 35 days after the date the transaction is entered. Two relief provisions are contained in the 2004 Act for violations of the 5% asset test or the 10% vote or value asset tests described in our Annual Report. A REIT that fails the 5% value test or the 10% vote or value tests at the close of any quarter without curing such failure within 30 days after the close of such quarter is excused if (a) the value of the assets causing the failure does not exceed the lesser of 1% of the total value of the REIT's assets at the end of the relevant quarter or $10,000,000 and (b) within 6 months after the last day of the quarter in which the REIT identifies the failure, either the REIT disposes of the assets causing the failure or otherwise satisfies the 5% value or 10% vote or value asset tests. The 2004 Act also provides an additional relief provision pursuant to which a REIT that fails the 5% value or the 10% vote or value asset tests in a taxable year may nevertheless qualify as a REIT if (a) the REIT provides the IRS with a description of each asset causing the failure, (b) the failure was due to reasonable cause and not willful neglect, (c) the REIT pays a tax equal to the greater of (i) $50,000 or (ii) the highest rate of corporate tax imposed (currently 35%) on the net income generated by the assets causing the failure during the period of the failure and (d) within 6 months after the last day of the quarter in which the REIT identifies the failure, either the REIT disposes of the assets causing the failure or otherwise satisfies the 5% value or 10% vote or value asset tests. Under the 2004 Act, capital gain dividends deductible by us in respect of our 2005 taxable year and beyond, and received by a non-U.S. shareholder, will be subject to the taxation and withholding regime applicable to ordinary income dividends (and the branch profits tax will not apply), provided that (1) the capital gain dividends are received with respect to a class of shares that is regularly traded on an established securities market located in the United States and (2) the foreign shareholder does not own more than 5% of that class of shares at any time during the taxable year in which the capital gain dividends are received. As such, qualifying non-U.S. shareholders will no longer be subject to FIRPTA withholding on capital gain dividends, and will no longer be required to file U.S. federal income tax returns in respect of their capital gain dividends. U.S. shareholders who realize a loss on the sale or exchange of our shares may be required to file IRS Form 8886, Reportable Transaction Disclosure Statement, if the loss meets or exceeds certain thresholds; for individual taxpayers, the threshold is $2,000,000 for a loss in a single taxable year. Substantial penalties may be imposed under the 2004 Act if Form 8886 is not properly filed. U.S. shareholders should consult with their tax advisors regarding Form 8886 filing requirements. ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS (c) Exhibits. 4.1 Appointment of Successor Rights Agent, dated as of December 13, 2004, by and between Hospitality Properties Trust and Wells Fargo Bank, National Association. (Filed herewith) 8.1 Opinion of Sullivan & Worcester LLP as to certain tax matters. (Filed herewith) 99.1 Dividend Reinvestment and Cash Purchase Plan. (Furnished herewith) 3 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. HOSPITALITY PROPERTIES TRUST By: /s/ Mark L. Kleifges Mark L. Kleifges Treasurer and Chief Financial Officer Date: December 13, 2004 EX-4.1 2 exh4-1.txt Exhibit 4.1 APPOINTMENT OF SUCCESSOR RIGHTS AGENT This instrument is dated as of December 13, 2004, and entered into by Hospitality Properties Trust, a Maryland real estate investment trust (the "Company"), and Wells Fargo Bank, National Association, a national banking association ("Wells Fargo"). BACKGROUND A. The parties hereto refer to the Rights Agreement, dated as of May 20, 1997 (the "Rights Agreement"), between the Company and State Street Bank and Trust Company, a Massachusetts trust company, as Rights Agent thereunder, to which EquiServe Trust Company, N.A., a national banking association, is the successor Rights Agent (in such capacity, the "Predecessor Rights Agent"). B. The parties further refer to the Terms and Conditions of Appointment, adopted by the Company on August 12, 2004 (the "Terms and Conditions"), providing, among things, for the appointment of Wells Fargo as the transfer agent for the Company's issued and outstanding capital shares and as successor Rights Agent under the Right Agreement. C. This instrument is entered into in furtherance of the appointment of Wells Fargo as successor Rights Agent under the Rights Agreement. NOW THEREFORE, the parties agree as follows: Section 1. The Company has heretofore given notice to the Predecessor Rights Agent of its removal as Rights Agent under the Rights Agreement, effective as of the date hereof subject to the appointment of a successor in accordance with Section 21 of the Rights Agreement. Section 2. Wells Fargo hereby represents to the Company that, in accordance with Section 21 of the Rights Agreement, it is a legal business entity organized and doing business under the laws of the United States, in good standing, authorized under such laws to exercise corporate trust, stock transfer or shareholder services powers, subject to supervision or examination by federal or state authority and has a combined capital and surplus of at least $100,000,000. Section 3. The Company hereby confirms that, pursuant to the Terms and Conditions, it has appointed, and it does hereby appoint, Wells Fargo to act as successor to the Predecessor Rights Agent as Rights Agent under the Rights Agreement, which appointment shall become effective at the Effective Time (as defined below). Section 4. Wells Fargo hereby confirms that, pursuant to the Terms and Conditions, it has accepted, and it does hereby accept, its appointment as successor Rights Agent under the Right Agreement effective at the Effective Time. Section 5. Pursuant and subject to Section 21 of the Rights Agreement, at the Effective Time Wells Fargo shall become and thereafter shall be a party to the Rights Agreement as Rights Agent thereunder and shall be vested with the same powers, rights, duties and responsibilities as if it had been originally named as Rights Agent without further act or deed of any person or entity. The parties acknowledge their intent that Wells Fargo does not assume and shall not have any responsibility or liability for actions or omissions of the Predecessor Rights Agent prior to the Effective Time. Section 6. This instrument shall become effective as of the opening of business in New York City on the date first above written (the "Effective Time"). Section 7. For purposes of Section 25 of the Rights Agreement, the address of Wells Fargo as Rights Agent thereunder for purposes of notices or demands (until another address is filed in writing by Wells Fargo as Rights Agent with the Company) shall be as set forth under Wells Fargo's signature to this instrument. Section 8. All the covenants and provisions of this instrument by or for the benefit of the Company or the Rights Agent shall bind and inure to the benefit of their respective successors and assigns under the Rights Agreement. Section 9. This instrument shall be deemed to be a contract made under the laws of the State of Maryland and shall for all purposes be governed by and construed in accordance with the laws of the State of Maryland applicable to contracts made and to be performed entirely within the State of Maryland, including its principles of conflicts of law. Section 10. This instrument may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument. IN WITNESS WHEREOF, the parties hereto have caused this instrument to be duly executed under seal as of the day and year first above written. [SEAL] WELLS FARGO BANK, NATIONAL ASSOCIATION ATTEST: By: /s/ Claudine Anderson Name: Claudine Anderson Title: Officer By: /s/ Susan J. Roeder Name: Susan J. Roeder Title: Assistant Secretary Address: Wells Fargo Shareowner Services 161 N. Concord Exchange South St. Paul, MN 55075 Attention: Claudine Anderson -2- [SEAL] HOSPITALITY PROPERTIES TRUST ATTEST: By: /s/ John G. Murray Name: John G. Murray Title: President and Chief Operating Officer By: /s/ Jennifer B. Clark Name: Jennifer B. Clark Title: Assistant Secretary -3- EX-8.1 3 exh8-1.txt Exhibit 8.1 [Letterhead Of Sullivan & Worcester LLP] December 13, 2004 Hospitality Properties Trust 400 Centre Street Newton, Massachusetts 02458 Ladies and Gentlemen: The following opinion is furnished to Hospitality Properties Trust, a Maryland real estate investment trust (the "Company") to be filed with the Securities and Exchange Commission (the "SEC") as Exhibit 8.1 to the Company's Current Report on Form 8-K (the "Form 8-K"), to be filed within one week of the date hereof, under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). In connection with this opinion, we have reviewed originals or copies, certified or otherwise identified to our satisfaction, of corporate records, certificates and statements of officers and accountants of the Company and of public officials, and such other documents as we have considered relevant and necessary in order to furnish the opinion hereinafter set forth. In doing so, we have assumed the genuineness of all signatures, the legal capacity of natural persons, the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents submitted to us as copies, and the authenticity of the originals of such documents. Specifically, and without limiting the generality of the foregoing, we have reviewed: (i) the declaration of trust and the by-laws of the Company, each as amended and restated; (ii) the section in Item 1 of the Company's Annual Report on Form 10-K for the year ended December 31, 2003 filed under the Exchange Act (the "Form 10-K") captioned "Federal Income Tax Considerations"; and (iii) Part (b) of Item 8.01 of the Form 8-K captioned "Supplementary federal income tax considerations". With respect to all questions of fact on which the opinion set forth below is based, we have assumed the accuracy and completeness of and have relied on the information set forth in the Form 10-K, the Form 8-K and in the documents incorporated therein by reference, and on representations made to us by officers of the Company. We have not independently verified such information. The opinion set forth below is based upon the Internal Revenue Code of 1986, as amended, the Treasury Regulations issued thereunder, published administrative interpretations thereof, and judicial decisions with respect thereto, all as of the date hereof (collectively, the "Tax Laws"). No assurance can be given that the Tax Laws will not change. In preparing the discussions with respect to Tax Laws in the section of Item 1 of the Form 10-K captioned "Federal Income Tax Considerations", as supplemented by Part (b) of Item 8.01 of the Form 8-K Hospitality Properties Trust December 13, 2004 Page 2 captioned "Supplementary federal income tax considerations", we have made certain assumptions and expressed certain conditions and qualifications therein, all of which assumptions, conditions and qualifications are incorporated herein by reference. With respect to all questions of fact on which our opinion is based, we have assumed the initial and continuing truth, accuracy and completeness of: (i) the information set forth in the Form 10-K, the Form 8-K, and in the documents incorporated therein by reference; and (ii) representations made to us by officers of the Company or contained in the Form 10-K and in the documents incorporated therein by reference, in each such instance without regard to qualifications such as "to the best knowledge of" or "in the belief of." We have relied upon, but not independently verified, the foregoing assumptions. If any of the foregoing assumptions is inaccurate or incomplete for any reason, or if the transactions described in the Form 10-K or the Form 8-K are consummated in a manner that is inconsistent with the manner contemplated therein, our opinion as expressed below may be adversely affected and may not be relied upon. Based upon and subject to the foregoing, we are of the opinion that the discussion with respect to Tax Laws matters in the section of Item 1 of the Form 10-K captioned "Federal Income Tax Considerations", as supplemented by the discussion in Part (b) of Item 8.01 of the Form 8-K captioned "Supplementary federal income tax considerations," in all material respects is accurate and fairly summarizes the Tax Laws issues addressed therein, and hereby confirm that the opinions of counsel referred to in said sections represent our opinions on the subject matter thereof. Our opinion above is limited to the matters specifically covered hereby, and we have not been asked to address, nor have we addressed, any other matters or any other transactions. Further, we disclaim any undertaking to advise you of subsequent changes of the matters stated, represented or assumed herein or any subsequent changes in the Tax Laws. This opinion is intended solely for the benefit and use of the Company, and is not to be used, released, quoted, or relied upon by anyone else for any purpose (other than as required by law) without our prior written consent. We hereby consent to filing of a copy of this opinion as an exhibit to the Form 8-K, which is incorporated by reference in the Company's Registration Statements on Form S-3 (File Nos. 333-109658, 333-89307, 333-84064 and 333-43573) under the Securities Act of 1933, as amended (the "Act"), and to the references to our firm in the Form 8-K, as so incorporated by reference in such Registration Statements. In giving such consent, we do not thereby admit that we come within the category of persons whose consent is required under Section 7 of the Act or under the rules and regulations of the SEC promulgated thereunder. Very truly yours, /s/ Sullivan & Worcester LLP SULLIVAN & WORCESTER LLP EX-99.1 4 exh99-1.txt Exhibit 99.1 [Logo] DIVIDEND REINVESTMENT & CASH PURCHASE PLAN Cusip # 44106M 10 2 400 Centre Street Newton, MA 02458-2076 Tel: (617) 964-8389 Fax: (617) 969-5730 Dear Shareholder: Thank you for your interest in our Dividend Reinvestment and Cash Purchase Plan (the "Plan"). We believe the Plan will satisfy objectives of investors who are interested in long-term capital growth rather than immediate income. The Plan provides shareholders an opportunity to systematically and conveniently increase the number of shares they own in Hospitality Properties Trust (the "Trust") at no added cost. In addition, shareholders may elect to make additional cash payments up to $10,000 per fiscal quarter to purchase additional shares of the Trust at no cost to the shareholder. Generally, all commissions and administrative charges for shares held and acquired pursuant to the Plan are paid by the Trust. The Plan is administered by Wells Fargo Bank, N.A., the Trust's transfer agent. Participation in the Plan is voluntary and you may join or withdraw at any time. The following pages describe the Plan, and hopefully will answer any questions you may have. You may enroll in the Plan by signing and returning the enrollment card at the back of this brochure or by calling the transfer agent at (866) 877-6331. Sincerely, /s/ John G. Murray John G. Murray President and Chief Operating Officer The information contained in the following questions and answers should be read in connection with the Terms and Conditions of the Plan set forth in the back of this brochure. WHAT IS THE DIVIDEND REINVESTMENT AND CASH PURCHASE PLAN? The Dividend Reinvestment and Cash Purchase Plan (the "Plan") offers shareholders in Hospitality Properties Trust (the "Trust") a prompt and simple way to reinvest their quarterly dividends in common shares of beneficial interest ("Shares") of the Trust, as well as to purchase additional Shares of the Trust. Wells Fargo Bank, N.A. ("Wells Fargo" or "Plan Agent") acts as Plan Agent for shareholders in administering the Plan. The complete Terms and Conditions of the Plan appear later in this brochure. WHO CAN PARTICIPATE IN THE PLAN? If you own Shares in your own name, you can participate directly in the Plan. If you own Shares that are held in the name of a brokerage firm, bank or other nominee, you should instruct your nominee to participate on your behalf. The Plan Agent will administer the Plan on the basis of the number of Shares certified from time to time by you as representing the total amount registered in your name or held for your account by your nominee. Nominees should provide to the Plan Agent a listing of participating beneficial owners. REINVESTMENT OF DIVIDENDS If you choose to participate in the Plan, all your dividends will be promptly invested for you, automatically increasing your holding in the Trust. All reinvestments are in full and fractional Shares carried to three decimal places. PURCHASE OF ADDITIONAL SHARES In addition to reinvestment of dividends, participants have the option to purchase up to $10,000 in additional Shares of the Trust each fiscal quarter. Shares purchased upon exercise of this optional purchase option are added to a participant's Plan account. You may send in a check or have the funds automatically withdrawn from your designated bank account. IS THERE A COST TO PARTICIPATE? There is no charge to participants for reinvesting dividends or purchasing Shares. The Plan Agent's service fees and brokerage charges are generally paid by the Trust except for withdrawal from the Plan. WHAT ARE THE TAX IMPLICATIONS FOR PARTICIPANTS? You will receive tax information annually for your personal records and to help you prepare your federal income tax return. The automatic reinvestment of dividends does not relieve you of any income tax which may be payable on dividends or distributions or on our payment of brokerage commissions on your behalf. ONCE ENROLLED IN THE PLAN, MAY I WITHDRAW FROM IT? You may withdraw from the Plan without penalty at any time by calling or writing to Wells Fargo (see "Whom should I contact for additional information?"). Your withdrawal will be effective as specified in paragraph 14 of the Terms and Conditions. If you withdraw, you will receive without charge a certificate for all of your full Plan Shares; or, if you wish, Wells Fargo will sell your Shares and send you the proceeds, less a service fee and brokerage commission. Wells Fargo will convert any fractional Shares you hold at the time of your withdrawal to cash at the current market price and send you a check for the net proceeds. HOW DO PARTICIPATING SHAREHOLDERS BENEFIT? o You will build holdings in the Trust easily and automatically, at reduced costs. o You will receive a detailed account statement from Wells Fargo showing total dividends and purchases, date of investment, Shares acquired and price per Share and total Shares of record held by you and the Plan Agent for you. Your proxy will include Shares purchased for you by the Plan Agent according to the Plan. o As long as you participate in the Plan, Wells Fargo will hold the Shares it has acquired for you in safekeeping. This convenience provides protection against loss, theft or inadvertent destruction of certificates. WHOM SHOULD I CONTACT FOR ADDITIONAL INFORMATION? If you hold Shares in your own name, please address all notices, correspondence, questions or other communications regarding the Plan to: Wells Fargo Shareowner Services P.O. Box 64856 St. Paul, MN 55164-0856 Certified/Overnight Mail: Wells Fargo Shareowner Services 161 North Concord Exchange South St. Paul, MN 55075-1139 General Information: Fax: 651-450-4085 Tel: 1-866-877-6331 Tel: 651-450-4064 (outside the United States) An automated voice response system is available 24 hours a day, 7 days a week. Customer Service Representatives are available from 7:00 a.m. to 7:00 p.m., Central Standard Time, Monday through Friday. Internet: General Inquiries - www.wellsfargo.com/shareownerservices Account Information - www.shareowneronline.com If your Shares are not held in your name, you should contact your brokerage firm, bank or other nominee for more information and to see if your nominee will participate in the Plan on your behalf. HOW DO I ACCESS MY ACCOUNT INFORMATION AND PERFORM TRANSACTIONS ONLINE? For shareholders of record, to activate your account and establish a Personal Identification Number (PIN), you will need your 10-digit Wells Fargo account number (which is listed on your account statement), your Social Security number, your email address and the name of the Trust. INSTRUCTIONS TO ACCESS YOUR ACCOUNT ONLINE ARE AS FOLLOWS: Go to www.shareowneronline.com and click "Here." Next, simply click on the box titled "First Time Visitor," then click on "New Member Sign-Up" and follow the instructions found on the "First Time Visitor New Member Registration" page. Once you have successfully signed up, you will receive an e-mail notifying you that your account information is available, usually the next business day. Once you have activated your account online, you can also authorize, change or stop your automatic cash withdrawal and investment service or sell some or all of your Plan Shares if the current market value of the Shares to be sold is $25,000 or less. Certain restrictions may apply to online information and transactions. CAN I PERFORM TRANSACTIONS BY TELEPHONE? If you already participate in the Plan and want to establish telephone privileges for your account, please call Wells Fargo. You may establish telephone privileges for your Plan account, enabling you to execute certain Plan orders by phone. You may sell a portion or all of your Plan Shares if the current market value of the Shares to be sold is $25,000 or less. You may also request a certificate for a portion or all of your full Plan Shares if the current market value of shares to be acquired is $50,000 or less. Certain restrictions may apply to telephone privileges. HOW TO ENROLL To enroll in the Dividend Reinvestment and Cash Purchase Plan, please review the Terms and Conditions in this brochure. Then all you need to do is: 1. Go online at www.shareowneronline.com and follow the instructions provided or 2. Complete and sign the attached authorization form and mail the form to Wells Fargo. Your reinvestment will begin with the next dividend payable after Wells Fargo receives your authorization, provided it is received prior to the record date. Should your authorization arrive after the record date, your reinvestment will begin with the following dividend. Your ability to purchase additional Shares will begin with a receipt of an optional payment in accordance with the Terms and Conditions specified in paragraph 4 of the Terms and Conditions. Such payment should be made payable to Shareowner Services and mailed to Wells Fargo at the address shown in this brochure. "Hospitality Properties Trust" and your account number or Social Security number should be noted on the check. Either the Trust or Wells Fargo may amend or terminate the Plan. Participants will receive written notice at least 60 days before the effective date of any amendment. In case of termination, participants will receive written notice at least 60 days before the record date of any dividend distribution by the Trust. TERMS AND CONDITIONS OF DIVIDEND REINVESTMENT AND CASH PURCHASES 1. You, Wells Fargo Bank, N.A. ("you" or "Wells Fargo"), will act as Plan Administrator for me and will open an account for me under the Dividend Reinvestment and Cash Purchase Plan (the "Plan") in the same name as my present common shares of beneficial interest ("Shares") of Hospitality Properties Trust (the "Trust") are registered, as of the first record date for a dividend distribution after you receive the authorization duly executed by me. 2. Whenever the Trust declares a distribution, you shall apply the amount of such dividend on my Shares and all optional cash payments to the purchase on the open market of Shares for my account. Such purchases will be made on or shortly after the payment date for such dividend (historically paid in late February, May, August and November), and in no event more than 45 days after such date (the "Investment Date"), except where temporary curtailment or suspension of purchases is necessary to comply with applicable provisions of federal securities law. 3. For all purposes of the Plan, Wells Fargo will purchase Shares on the New York Stock Exchange (the "NYSE") or, if such Shares are not traded on the NYSE, where Shares are traded and the purchase will be on such terms as to price, delivery and otherwise as Wells Fargo may determine. The price at which the Shares will be deemed to have been acquired for each participant shall be the weighted average price of all Shares purchased by Wells Fargo for all participants in the Plan. Notwithstanding the foregoing provisions of this paragraph 3, in the event that the rules and regulations of the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, require temporary suspension of such purchases, such purchases will be made or resumed as or when permitted by such rules and regulations. Wells Fargo may rely and act upon an opinion of outside legal counsel in determining whether the purchase of Shares may be prohibited and when such purchases may be resumed. 4. I understand that I have the option of sending up to $10,000 per fiscal quarter in additional funds to you to be expended by you to purchase Shares on the open market for my account. Additional funds should be accompanied by either the authorization for automatic dividend reinvestment form or the optional cash election form attached to my statement directing you to apply such cash contribution to the purchase of Shares for my account. Funds received more than 30 days before the Investment Date or less than two business days prior to the Investment Date will be returned uninvested UNLESS I REQUEST to have Wells Fargo retain these funds until the next Investment Date. I may withdraw my entire optional cash payment by written notice to you provided it is received by you not less than two business days before such payment is invested. The number of Shares to be credited to my account shall be determined by dividing the dollar amount of the optional payment by the purchase price per Share as defined in Paragraph 3 above. Optional cash investments must be in United States dollars. DO NOT SEND CASH. If any optional cash investment, including payments by check or automatic withdrawal, is returned for any reason, Wells Fargo will remove from my account any Shares purchased upon prior credit of such funds, and will sell these Shares. Wells Fargo may sell other Shares in the account to recover a returned funds fee for each optional cash investment returned unpaid for any reason and may sell additional Shares as necessary to cover any market loss incurred by Wells Fargo. Checks should be made payable to "SHAREOWNER SERVICES." I may elect to make optional cash investments, paid by electronic funds transfer and withdrawn automatically from my predesignated bank account. To make optional cash investments by automatic deduction, I must go online or complete and sign an Automatic Cash Withdrawal and Investment Service Form, available from Wells Fargo, and return the form to Wells Fargo. Forms are processed and become effective as promptly as practicable. Once the automatic monthly deduction option is initiated, funds will be drawn from my designated bank account on or about five business days before the next cash Investment Date, and will be invested in the Shares on the cash Investment Date. I will not receive any confirmation of the transfer of funds other than as reflected in my Plan account statement and in my bank account statement. I may change the designated account for automatic deduction by online or written instruction to Wells Fargo. I can stop the Automatic Cash Withdrawal and Investment Service by going online (see "How do I access my account information Internet Privileges?"), calling or writing Wells Fargo at the address shown in this brochure. To be effective with respect to a particular Investment Date, my change or termination request must be received by Wells Fargo at least 15 business days prior to the Investment Date. 5. Open-market purchases provided for above may be made on any securities exchange where the Trust's Shares are traded or, if such Shares are not traded on any securities exchange, in the over-the-counter market and may be on such terms as to delivery and otherwise as you shall determine. My funds held by you uninvested will not bear interest, and it is understood that, in any event, you shall have no liability in connection with any inability to purchase Shares within 45 days after the initial date of such purchase as herein provided or in connection with the timing of any purchases affected. You shall have no responsibility for the value of the Shares of the Trust acquired for my account. 6. I may elect to deposit my original certificate(s) into the Plan account for safekeeping by sending the certificates(s) to Wells Fargo together with instructions to deposit the certificate(s) into the Plan. Because I bear the risk of loss when sending share certificates through the mail, Wells Fargo suggests that I send them registered insured for at least 2% of the current market value. I SHOULD NOT ENDORSE THE CERTIFICATES. The transaction will appear on the statement for that period, and Shares will be held by Wells Fargo in its name or nominee name. These Shares will be held in the Plan account until such time as I request a certificate, sale or termination from the Plan. I should note that a cost basis record for deposited Shares cannot be provided by Wells Fargo, and therefore I should maintain a record of purchase prices. 7. You may hold my Shares pursuant to my authorization, together with the Shares of other shareholders of the Trust acquired pursuant to similar authorizations, in your name or that of your nominee. You will forward to me any proxy solicitation material and will vote any Shares so held for me only in accordance with the proxy returned by me to the Trust. Upon my written request, you will deliver to me, without charge, a certificate or certificates for the full Shares. 8. If I submit a request to sell all or part of my Plan Shares, and I request net proceeds to be automatically deposited to a bank checking or savings account, I must provide a voided blank check for a checking account or blank savings deposit slip for a savings account. If I am unable to provide a voided check or deposit slip, my written request must have my signature(s) medallion guaranteed by an eligible financial institution for direct deposit. Requests for automatic deposit of sale proceeds that do not provide the required documentation will be ignored and a check for the net proceeds will be issued. 9. You will confirm to me each acquisition made for my account as soon as practicable but not later than 60 days after the date thereof. Although I may from time to time have an undivided fractional interest (computed to three decimal places) in a Share, no certificates for a fractional Share will be issued. However, dividends on fractional Shares will be credited to my account. In the event of termination of my account under the Plan, you will adjust for any such undivided fractional interest in cash at the market value minus service fees and commissions. 10. It is understood that the reinvestment of dividends does not relieve me of any income tax which may be payable on some dividends. You will report to me the amount of dividends credited to my account. 11. Except as otherwise expressly provided herein, I may not sell, pledge, hypothecate or otherwise assign or transfer my account, any interest therein or any cash or Shares credited to my account. No attempt at any such sale, pledge, hypothecation or other assignment or transfer shall be effective. Nothing herein shall affect my rights in respect to Shares for which certificates have been received. 12. Any share dividends or split shares distributed by the Trust on Shares held by you for me will be credited to my account. If I send a notice of termination or a request to sell to you between the record date and the payable date for a share distribution, the request will not be processed until the share distribution is credited to my account. In the event that the Trust makes available to its shareholders rights to purchase additional Shares held for me under the Plan, such rights will be added to other Shares held by me in calculating the number of rights to be issued to me. FEE DISCLOSURE TABLE - -------------------------------------------------------------------------------- CERTIFICATE DEPOSIT company paid CERTIFICATE ISSUANCE company paid INVESTMENT FEES via dividend reinvestment company paid via optional cash investment company paid via automatic withdrawal company paid purchase commission company paid - -------------------------------------------------------------------------------- SALE FEES service fee $10.00 per transaction sale commission $0.10 per share - -------------------------------------------------------------------------------- FEE FOR RETURNED CHECKS OR REJECTED AUTOMATIC BANK WITHDRAWALS $25.00 per item - -------------------------------------------------------------------------------- PRIOR YEAR DUPLICATE STATEMENTS $15.00 per year - -------------------------------------------------------------------------------- Notwithstanding the above, (i) the Trust will not be charged any brokerage commissions on any purchase of Shares (with respect to the reinvestment of dividends and any optional cash contributions) that exceed (on a per share basis) four percent of the weighted average per share price of Shares purchased by Wells Fargo for all participants in the Plan on or with respect to an Investment Date and (ii) the Trust reserves the right not to pay any brokerage commissions or any other fees or charges to the extent the Trust determines that any such brokerage commissions or other fees or charges would result in adverse tax consequences to the Trust. 14. I may terminate my account under the Plan by notifying you in writing or by calling the number shown in this brochure. If my request to terminate my participation in the Plan is received on or after a dividend record date, but before the dividend payment date, my termination will be processed as soon as practicable, and a separate dividend check will be mailed to me. Future dividends will be paid in cash, unless I rejoin the Plan. In addition, if I send notice of termination or a request to sell to Wells Fargo between the record date and payable date of a share distribution, the request will be held until the share distribution is credited to my account. The Plan may be terminated by you or the Trust upon notice in writing mailed to me at least 60 days prior to any dividend by the Trust. Upon any termination I may elect to receive either shares or cash for all the full Shares in the account. If cash is elected, you will sell such Shares at the then current market value and you will send the proceeds to me, after deducting brokerage commissions and service charges. If no election is made in the request for termination, a certificate for full Shares held in the Plan will be issued to me and sent to my address of record. In either case, I will receive cash, minus brokerage commissions and service charges, at the current market value in lieu of any fractional interest in a Share. If I submit a request to sell all or part of my Plan Shares, and I request net proceeds to be automatically deposited to a United States bank checking or savings account, I must provide a voided blank check for a checking account or blank savings deposit slip for a savings account. If I am unable to provide a voided check or deposit slip, my written request must have my signature(s) medallion guaranteed by an eligible financial institution for direct deposit. Requests for automatic deposit of sale proceeds that do not provide the required documentation will not be processed and a check for the net proceeds will be issued. I should be aware that the share price of the Trust's Shares may fall or rise during the period between a request for sale, its receipt by Wells Fargo, and the ultimate sale in the open market. I should evaluate these possibilities while deciding whether and when to sell any Shares through the Plan. The price risk will be borne solely by me. If my request to transfer all Shares in my Plan account is received between a dividend record date and payable date, my transfer request will be processed; however, my Plan account will not be terminated. I may receive additional dividend reinvestment Shares which will require me to submit a written request to transfer the additional Shares. 15. These Terms and Conditions may be amended or supplemented by you or the Trust at any time but, except when necessary or appropriate to comply with applicable laws or the rules or policies of the Securities and Exchange Commission or any other regulatory authority, only by mailing to me appropriate written notice at least 60 days prior to the effective date thereof. The amendment or supplement shall be deemed to be accepted by me unless, prior to the effective date thereof, you receive written notice of the termination of my account under the Plan. Any such amendment may include an appointment by you in your place and stead of a successor Agent under these Terms and Conditions, with full power and authority to perform all or any of the acts to be performed by the Agent under these Terms and Conditions. Upon any such appointment of any agent for the purpose of receiving dividends, the Trust will be authorized to pay to such successor Agent, for my account, all dividends payable on Shares of the Trust held in my name or under the Plan for retention or application by such successor Agent as provided in these Terms and Conditions. 16. You should at all times act in good faith and agree to use your best efforts within reasonable limits to ensure the accuracy of all services performed under this Agreement and to comply with applicable law but assume no responsibility and shall not be liable for loss or damage due to errors unless such error is caused by your negligence, bad faith or willful misconduct or that of your employees. You shall not be liable hereunder for any act done in good faith, or for any good faith omission to act, including without limitation, any claims of liability (1) arising out of failure to terminate my account upon my death prior to receipt of notice in writing of such death, and (2) with respect to the prices at which Shares are purchased or sold for my account and the times such purchases or sales are made. 17. Wells Fargo will furnish the name of the registered broker/dealer utilized in Share transactions, within a reasonable time upon my written request. 18. These Terms and Conditions shall be governed by the laws of The Commonwealth of Massachusetts. -----END PRIVACY-ENHANCED MESSAGE-----