Company: IIPR
Filing Date: 2025-02-26
Form Type: 424B5
Source: 0001104659-25-017454
Chunk: 154

Company: INNOVATIVE INDUSTRIAL PROPERTIES INC
Filing Date: 2025-02-26
Form: 424B5
Chunk 154
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 for the Plan, taking into account such fiduciary obligations
described above.

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Prohibited Transactions

Generally, both ERISA and the Code prohibit Plans
from engaging in certain transactions involving Plan assets with specified parties, such as sales or exchanges or leasing of property,
loans or other extensions of credit, furnishing goods or services, or transfers to, or use of, plan assets, unless an exemption is available.
The specified parties are referred to as “parties-in-interest” under ERISA and as “disqualified persons” under
the Code. A party in interest or disqualified person who engages in a non-exempt prohibited transaction may be subject to excise taxes
and other penalties and liabilities under ERISA and the Code. In addition, the fiduciary of a Plan that engages in a non-exempt prohibited
transaction may be subject to penalties and liabilities under ERISA and the Code, including an obligation to restore to the Plan any
profits they realized as a result of the transaction or breach and make up for any losses incurred by the Plan as a result of the transaction
or breach. With respect to an IRA that invests in our securities, the occurrence of a non-exempt prohibited transaction involving the
individual who established the IRA, or his or her beneficiary, would cause the IRA to lose its tax-exempt status under Section 408(e)(2) of
the Code. Accordingly, the fiduciary of a Plan or any other person making investment decisions for a Plan should consider the application
of the prohibited transaction rules (and the available exemptions, if any) of ERISA and the Code prior to making any decision to
purchase and hold our securities. There can be no assurance that the conditions of any of the available prohibited transaction exemptions
will be satisfied. In addition, if we are deemed to hold plan assets (as described below), then our management could be characterized
as fiduciaries with respect to such assets, and each would be deemed to be a party-in-interest under ERISA and a disqualified person
under the Code with respect to investing Plans. Whether or not we are deemed to hold plan assets, if we or our affiliates are affiliated
with a Plan investor, we might be a disqualified person or party-in-interest with respect to such Plan investor, resulting in a non-exempt
prohibited transaction merely upon investment by such Plan in our securities.

Plan Asset Considerations

As noted above, if we are deemed to hold
“plan assets