THE CORPORATE LIBRARY

Related Party Transactions and Outside Related Director Information

Franklin Street Properties Corp. (FSP)

3/23/2006 Proxy Information

Messrs. Carter, MacPhee and Gribbell and Mses. Fournier and Notopoulos, each of whom is an executive officer of the Company, serve, at the request of the Company, as executive officers and, except for Ms. Notopoulos, directors of each of the Sponsored REITs. Ms. Notopoulos serves as a director of certain of the Sponsored REITs. None of such persons receives any remuneration from the Sponsored REITs for such service.

FSP Investments, a wholly owned subsidiary of the Company, provides syndication and real estate acquisition advisory services for the Sponsored REITs. Fees from Sponsored REITs for property acquisition services amounted to approximately $1,350,000 for the year ended December 31, 2005. As of March 14, 2006, there were no fees from Sponsored REITs during 2006. Sales commissions earned from the sale of Sponsored REIT preferred shares amounted to approximately $9,268,000 for the year ended December 31, 2005. As of March 14, 2006, there were no sales commissions from the sale of Sponsored REIT preferred shares during 2006.

During 2005 and 2006, the Company provided interim financing for the purchase of certain Sponsored REIT properties, and development services prior to completion of the Sponsored REITs' private equity offerings. The Sponsored REITs paid the Company financing commitment fees of approximately $6,425,000 and development fees of approximately $1,637,000 for the year ended December 31, 2005. As of March 14, 2006, the Company had not received any financing commitment fees from the Sponsored REITs during 2006. Interest income earned from loans to the Sponsored REITs amounted to approximately $1,135,000 for the year ended December 31, 2005. As of March 14, 2006, the interest income earned from loans to the Sponsored REITs during 2006 amounted to approximately $262,223. The interest rate charged by the Company to the Sponsored REITs is equal to the interest rate paid by the Company to Citizens Bank for borrowings under its line of credit. Therefore, the Company does not realize any significant profit from interest on the loans. All loans to Sponsored REITs were evidenced by promissory notes and were paid in full upon closing of the applicable Sponsored REIT's private equity offering during 2005 or 2006. In addition, one loan made to a Sponsored REIT during 2006 was partially outstanding as of March 14, 2006. The following table summarizes the interim financing transactions from January 1, 2005 through March 14, 2006: (See page 17 of proxy for table)

Total asset management fee income paid by the Sponsored REITs to the Company amounted to approximately $672,000 for the year ended December 31, 2005. As of February 28, 2006, the total asset management fee income earned by the Company during 2006 was approximately $111,632. Asset management fees are approximately 1% of collected rents.

Aggregate fees charged to the Sponsored REITs by the Company amounted to approximately $19,352,000 for the year ended December 31, 2005. As of March 14, 2006, the aggregate fees charged to the Sponsored REITs during 2006 by the Company is approximately $128,807.

Mr. Carter's son, Jeffrey Carter, is Senior Vice President/Director of Acquisitions of the Company. For the year ended December 31, 2005, he earned total compensation of $323,987 (including salary, cash bonus paid during 2006 for 2005 performance and contribution to a simple IRA plan).

Mr. Carter's son, Scott Carter, is Senior Vice President/In-house Counsel of the Company. He joined the Company on October 17, 2005. For the year ended December 31, 2005, he earned total compensation of $50,375 (including salary and cash bonus paid during 2006 for 2005 performance).

Mr. Silverstein, a director of the Company, purchased, on the same terms as non-affiliated purchasers, investments in certain Sponsored REITs during 2005. Mr. Silverstein paid the Company an aggregate of $56,150 in brokerage commissions related to these investments. Mr. Silverstein paid brokerage commissions on the same terms as non-affiliated purchasers of shares in the Sponsored REITs.

Mr. McGillicuddy, a director of the Company, purchased, on the same terms as non-affiliated purchasers, investments in certain Sponsored REITs during 2005. Mr. McGillicuddy paid the Company an aggregate of $2,750 in brokerage commissions related to these investments. Mr. McGillicuddy paid brokerage commissions on the same terms as non-affiliated purchasers of shares in the Sponsored REITs.

On April 30, 2005, the Company consummated the acquisition of four real estate investment trusts (FSP Montague Business Center Corp., FSP Addison Circle Corp., FSP Royal Ridge Corp. and FSP Collins Crossing Corp., collectively the "Target REITs") pursuant to an Agreement and Plan of Merger dated as of August 13, 2004, as amended on March 10, 2005, by means of the merger of each Target REIT with and into a wholly-subsidiary of the Company (the "Mergers"). In connection with the Mergers, the preferred stock of each Target REIT (the "Target Stock") was converted into shares of Common Stock of the Company.

George J. Carter, President, Chief Executive Officer, a director of the Company and a member of the special committee of the Company's board charged with evaluating the Mergers was also the President and a director of each Target REIT. R. Scott MacPhee and William W. Gribbell, each an Executive Vice President of the Company, were each also an Executive Vice President, a director of each Target REIT and a member of the special committee of each Target REIT's board of directors. Barbara J. Fournier, Vice President, Chief Operating Officer, Treasurer, Secretary and director of the Company was also Vice President, Chief Operating Officer, Treasurer, Secretary and a director of each Target REIT. Janet P. Notopoulos, Vice President, a director of the Company and a member of the special committee of the Company's board charged with evaluating the Mergers was also Vice President of each Target REIT. In addition, Messrs. Silverstein and McGillicuddy, each a director of the Company, owned an aggregate of 173 and 14 shares of Target Stock, respectively. These shares of Target Stock held by Messrs. Silverstein and McGillicuddy converted into approximately 1,022,217 and approximately 80,836 shares of Common Stock of the Company, respectively.

On March 15, 2006, the Company entered into an Agreement and Plan of Merger (the "Merger Agreement") to acquire five real estate investment trusts (FSP Willow Bend Office Center Corp., FSP Innsbrook Corp., FSP 380 Interlocken Corp., FSP Blue Lagoon Drive Corp. and FSP Eldridge Green Corp., collectively the "2006 Target REITs") by means of the merger of each 2006 Target REIT with and into a wholly-subsidiary of the Company (the "2006 Mergers"). In connection with the 2006 Mergers, the preferred stock of each 2006 Target REIT would be converted into shares of Common Stock of the Company and, in certain circumstances, the holders of preferred stock in each 2006 Target REIT would also receive cash consideration. The Company expects to consummate the 2006 Mergers on or about May 1, 2006. As preferred stockholders in certain of the 2006 Target REITs, Messrs. Silverstein and McGillicuddy will be entitled to approximately $11,210,219 and $3,300,000 of merger consideration, respectively. In addition, on March 10, 2006, as a result of negotiations between SILP III, an affiliate of Mr. Silverstein, and FSP Eldridge Green Corp., FSP Eldridge Green Corp. redeemed 10 shares of preferred stock held by SILP III for an aggregate amount of $1,240,590.60, equal to the price per share of FSP Eldridge Green Corp. set forth in the Merger Agreement plus the dividend that would have been paid to SILP III in respect of the first quarter of 2006 had such shares not been redeemed.