Company: IIPR
Filing Date: 2025-02-26
Form Type: 424B5
Source: 0001104659-25-017454
Chunk: 71

Company: INNOVATIVE INDUSTRIAL PROPERTIES INC
Filing Date: 2025-02-26
Form: 424B5
Chunk 71
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ively by a group of related individuals or entities to be owned
constructively by one individual or entity. As a result, the acquisition of less than 9.8% in value of the aggregate of our outstanding
shares of stock and 9.8% (in value or in number of shares, whichever is more restrictive) of any class or series of our shares of stock
(or the acquisition of an interest in an entity that owns, actually or constructively, shares of our stock by an individual or entity),
could, nevertheless, cause that individual or entity, or another individual or entity, to violate the ownership limits.

Our board of directors may, upon receipt of certain
representations, undertakings and agreements and in its sole discretion, exempt (prospectively or retroactively) any person from the
ownership limits and establish a different limit, or excepted holder limit, for a particular person if the person’s ownership in
excess of the ownership limits will not then or in the future result in us failing the “closely held” test under Section 856(h) of
the Code (without regard to whether the person’s interest is held during the last half of a taxable year) or otherwise cause us
to fail to qualify as a REIT. In order to be considered by our board of directors for exemption, a person also must not own, actually
or constructively, an interest in one of our tenants (or a tenant of any entity which we own or control) that would cause us to own,
actually or constructively, more than a 9.9% interest in the tenant unless the revenue derived by us from such tenant is sufficiently
small that, in the opinion of our board of directors, rent from such tenant would not adversely affect our ability to qualify as a REIT.
The person seeking an exemption must provide such representations and undertakings to the satisfaction of our board of directors that
it will not violate these two restrictions. The person also must agree that any violation or attempted violation of these restrictions
will result in the automatic transfer to a trust of the shares of stock causing the violation. As a condition of granting an exemption
or creating an excepted holder limit, our board of directors may, but is not be required to, obtain an opinion of counsel or private
ruling from the Internal Revenue Service (the “Service”) satisfactory to our board of directors with respect to our qualification
as a REIT and may impose such other conditions or restrictions as it deems