Exhibit 10.4


 


FORM OF CHICAGO ATLANTIC
REAL ESTATE FINANCE, INC.

2021 OMNIBUS INCENTIVE PLAN


 


1. Purpose. 
The purpose of this Chicago Atlantic Real Estate Finance, Inc. 2021 Omnibus Incentive Plan is to provide a means through which the Company
and other members of the Company Group may attract and retain key personnel and to provide a means whereby directors, officers, employees,
consultants and advisors of the Company and other members of the Company Group, as well as directors, officers and employees of the Manager
and its Affiliates who are providing services to the Company Group, can acquire and maintain an equity interest in the Company, or be
paid incentive compensation, including incentive compensation measured by reference to the value of Common Stock, thereby strengthening
their commitment to the welfare of the Company Group and aligning their interests with those of the Company’s stockholders. 


 


2. Definitions. 
The following definitions shall be applicable throughout the Plan.


 


(a) “Absolute
Share Limit” has the meaning given such term in Section 5(b) of the Plan.


 


(b) “Adjustment
Event” has the meaning given such term in Section 11(a) of the Plan.


 


(c) “Affiliate”
means any Person that directly or indirectly controls, is controlled by or is under common control with the Company.  The term “control”
(including, with correlative meaning, the terms “controlled by” and “under common control with”), as applied to
any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies
of such Person, whether through the ownership of voting or other securities, by contract or otherwise.


 


(d) “Award”
means, individually or collectively, any Incentive Stock Option, Nonqualified Stock Option, Stock Appreciation Right, Restricted Stock,
Restricted Stock Unit or Other Equity-Based Award granted under the Plan.


 


(e)  “Award
Agreement” means the document or documents by which each Award is evidenced, which may be in written or electronic form.


 


(f) “Board”
means the Board of Directors of the Company.


 


(g) “Cause”
means, as to any Participant, unless the applicable Award Agreement states otherwise, (i) “Cause”, as defined in any
employment or consulting agreement between the Participant and the Service Recipient in effect at the time of such Termination, or (ii) in
the absence of any such employment or consulting agreement (or the absence of any definition of “Cause” contained therein),
the Participant’s (A) willful neglect in the performance of the Participant’s duties for the Service Recipient or willful
or repeated failure or refusal to perform such duties; (B) engagement in conduct in connection with the Participant’s employment
or service with the Service Recipient, which results in, or could reasonably be expected to result in, material harm to the business or
reputation of the Service Recipient or any other member of the Company Group; (C) conviction of, or plea of guilty or no contest
to, (I) any felony; or (II) any other crime that results in, or could reasonably be expected to result in, material harm to
the business or reputation of the Service Recipient or any other member of the Company Group; (D) material violation of the written
policies of the Service Recipient, including, but not limited to, those relating to sexual harassment or the disclosure or misuse of confidential
information, or those set forth in the manuals or statements of policy of the Service Recipient; (E) fraud or misappropriation, embezzlement
or misuse of funds or property belonging to the Service Recipient or any other member of the Company Group; or (F) act of personal
dishonesty that involves personal profit in connection with the Participant’s employment or service to the Service Recipient; provided,
in any case, a Participant’s resignation after an event that would be grounds for a Termination for Cause will be treated as a Termination
for Cause hereunder.


 






     


     


    

 


(h)  “Change
in Control” means:


 


(i) the
acquisition (whether by purchase, merger, consolidation, combination or other similar transaction) by any Person of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) of more than 50% (on a fully diluted basis) of either (A) the
then outstanding shares of Common Stock, taking into account as outstanding for this purpose such Common Stock issuable upon the exercise
of options or warrants, the conversion of convertible stock or debt, the exercise, exchange or conversion of any interests of any Subsidiary,
and the exercise of any similar right to acquire such Common Stock or (B) the combined voting power of the then outstanding voting
securities of the Company entitled to vote generally in the election of directors; provided, however, that for purposes of
this Plan, the following acquisitions shall not constitute a Change in Control: (I) any acquisition by the Company or any Affiliate;
(II) any acquisition by any employee benefit plan sponsored or maintained by the Company or any Affiliate; or (III) in respect
of an Award held by a particular Participant, any acquisition by the Participant or any group of Persons including the Participant (or
any entity controlled by the Participant or any group of Persons including the Participant);


 


(ii)   at
any time following a Public Listing, during any period of twelve (12) months, individuals who, at the beginning of such period, constitute
the Board (the “Incumbent Directors”) cease for any reason to constitute at least a majority of the Board, provided
that any person becoming a director subsequent to the date hereof, whose election or nomination for election was approved by a vote of
at least two-thirds of the Incumbent Directors then on the Board (either by a specific vote or by approval of the proxy statement of the
Company in which such person is named as a nominee for director, without written objection to such nomination) shall be an Incumbent Director;
provided, however, that (ii) shall only apply following a Public Listing and provided, further that
no individual initially elected or nominated as a director of the Company as a result of an actual or threatened election contest, as
such terms are used in Rule 14a-12 of Regulation 14A promulgated under the Exchange Act, with respect to directors or as a result
of any other actual or threatened solicitation of proxies or consents by or on behalf of any person other than the Board shall be deemed
to be an Incumbent Director; or


 


(iii)  the
sale, transfer or other disposition of all or substantially all of the assets of the Company Group (taken as a whole) to any Person that
is not an Affiliate of the Company;


 


except, in the case of clauses (i)-(iii),
if the Change in Control results from a transaction between the Company and the Manager or an Affiliate of the Manager or from a termination
of the Management Agreement.


 


(i)  “Code”
means the Internal Revenue Code of 1986, as amended, and any successor thereto.  Reference in the Plan to any section of the Code
shall be deemed to include any regulations or other interpretative guidance under such section, and any amendments or successor provisions
to such section, regulations or guidance.


 


(j) “Committee”
means the Compensation Committee of the Board or any properly delegated subcommittee thereof or, if no such Compensation Committee or
subcommittee thereof exists, the Board.


 


(k)  “Common
Stock” means the common stock of the Company, par value $0.01 per share (and any stock or other securities into which such Common
Stock may be converted or into which it may be exchanged).


 


(l)  “Company”
means Chicago Atlantic Real Estate Finance, Inc., a Maryland corporation, and any successor thereto.


 


(m) “Company
Group” means, collectively, the Company and any of its Subsidiaries.


 


(n) “Date
of Grant” means the date on which the granting of an Award is authorized, or such other date as may be specified in such authorization.


  


(o)  “Disability”
means, as to any Participant, unless the applicable Award Agreement states otherwise, (i) “Disability”, as defined in
any employment or consulting agreement between the Participant and the Service Recipient in effect at the time of such Termination; or
(ii) in the absence of any such employment or consulting agreement (or the absence of any definition of “Disability”
contained therein), a condition entitling the Participant to receive benefits under a long-term disability plan of the Service Recipient
or other member of Company Group in which such Participant is eligible to participate, or, in the absence of such a plan, the complete
and permanent inability of the Participant by reason of illness or accident to perform the duties of the occupation at which the Participant
was employed or served when such disability commenced.  Any determination of whether Disability exists shall be made by the Company
(or designee) in its sole and absolute discretion.


 






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(p)  “Effective
Date” means the date of the Company’s initial public offering.


 


(q)  “Eligible
Manager Employee” means any director, officer or employee of the Manager or any of its Affiliates that provides services to
any member of the Company Group.


 


(r) “Eligible
Person” means any (i) individual employed by any member of the Company Group; (ii) director or officer of any member
of the Company Group; or (iii) consultant, advisor or other service provider to any member of the Company Group, including Eligible
Manager Employees, who may be offered securities registrable pursuant to a registration statement on Form S-8 under the Securities
Act, who, in the case of each of clauses (i) through (iii) above has entered into an Award Agreement or who has received written
notification from the Committee or its designee that they have been selected to participate in the Plan.


 


(s) “Exchange
Act” means the Securities Exchange Act of 1934, as amended, and any successor thereto.  Reference in the Plan to any section
of (or rule promulgated under) the Exchange Act shall be deemed to include any rules, regulations or other interpretative guidance
under such section or rule, and any amendments or successor provisions to such section, rules, regulations or guidance.


 


(t) “Exercise
Price” has the meaning given such term in Section 7(b) of the Plan.


 


(u) “Fair
Market Value” means, on a given date, (i) if the Common Stock is listed on a national securities exchange, the closing
sales price of the Common Stock reported on the primary exchange on which the Common Stock is listed and traded on such date, or, if there
are no such sales on that date, then on the last preceding date on which such sales were reported; (ii) if the Common Stock is not
listed on any national securities exchange but is quoted in an inter-dealer quotation system on a last sale basis, the average between
the closing bid price and ask price reported on such date, or, if there is no such sale on that date, then on the last preceding date
on which a sale was reported; or (iii) if the Common Stock is not listed on a national securities exchange or quoted in an inter-dealer
quotation system on a last sale basis, the amount determined by the Committee in good faith to be the fair market value of the Common
Stock; provided, however, as to any Awards granted on or with a Date of Grant of the date of the pricing of the
Company’s initial public offering, “Fair Market Value” shall be equal to the per share price at which the Common Stock
is offered to the public in connection with such initial public offering.


 


(v) “GAAP”
has the meaning given such term in Section 7(d) of the Plan.


 


(w) “Immediate
Family Members” has the meaning given such term in Section 13(b) of the Plan.


 


(x) “Incentive
Stock Option” means an Option that is designated by the Committee as an incentive stock option as described in Section 422
of the Code and otherwise meets the requirements set forth in the Plan.


 


(y) “Indemnifiable
Person” has the meaning given such term in Section 4(e) of the Plan.


 


(z)  “Management
Agreement” means that certain Management Agreement, dated as of May 1, 2021, as amended by the Amendment to Management Agreement,
dated as of October 26, 2021, by and between the Company and the Manager, as amended, restated, supplemented or otherwise modified from
time to time.


 


(aa)“Manager”
means Chicago Atlantic REIT Manager, LLC, a Delaware limited liability company.


 


(bb) “NASDAQ”
means The NASDAQ Global Market.


 


(cc)  “Nonqualified
Stock Option” means an Option which is not designated by the Committee as an Incentive Stock Option.


 


(dd) “Non-Employee
Director” means a member of the Board who is not an employee of any member of the Company Group.


 






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(ee) “Option”
means an Award granted under Section 7 of the Plan.


 


(ff) “Option
Period” has the meaning given such term in Section 7(c) of the Plan.


 


(gg) “Other
Equity-Based Award” means an Award that is not an Option, Stock Appreciation Right, Restricted Stock or Restricted Stock Unit
that is granted under Section 10 of the Plan and is payable by (i) delivery of Common Stock or other equity interests, or (ii) reference
to the value of Common Stock or other equity interests.


 


(hh) “Participant”
means an Eligible Person who has been selected by the Committee to participate in the Plan and to receive an Award pursuant to the Plan.


 


(ii) “Permitted
Transferee” has the meaning given such term in Section 13(b) of the Plan.


 


(jj) “Person”
means any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act).


 


(kk) “Plan”
means this Chicago Atlantic Real Estate Finance, Inc. 2021 Omnibus Incentive Plan, as it may be amended from time to time.


 


(ll) “Public
Listing” means a listing or trading of the Common Stock on the New York Stock Exchange or NASDAQ.


 


(mm) “Qualifying
Director” means a person who is, with respect to actions intended to obtain an exemption from Section 16(b) of the
Exchange Act pursuant to Rule 16b-3 under the Exchange Act, a “non-employee director” within the meaning of Rule 16b-3
under the Exchange Act.


 


(nn) “Restricted
Period” means the period of time determined by the Committee during which an Award is subject to restrictions, including vesting
conditions.


 


(oo) “Restricted
Stock” means Common Stock, subject to certain specified restrictions (which may include, without limitation, a requirement that
the Participant remain continuously employed or provide continuous services for a specified period of time), granted under Section 9
of the Plan.


 


(pp) “Restricted
Stock Unit” means an unfunded and unsecured promise to deliver shares of Common Stock, cash, other securities or other property,
subject to certain restrictions (which may include, without limitation, a requirement that the Participant remain continuously employed
or provide continuous services for a specified period of time), granted under Section 9 of the Plan.


 


(qq) “SAR
Period” has the meaning given such term in Section 8(c) of the Plan.


 


(rr) “Securities
Act” means the Securities Act of 1933, as amended, and any successor thereto.  Reference in the Plan to any section of
(or rule promulgated under) the Securities Act shall be deemed to include any rules, regulations or other interpretative guidance
under such section or rule, and any amendments or successor provisions to such section, rules, regulations or guidance.


 


(ss) “Service
Recipient” means, with respect to a Participant holding a given Award, the member of the Company Group by which the original
recipient of such Award is, or following a Termination was most recently, principally employed or to which such original recipient provides,
or following a Termination was most recently providing, services, as applicable.


 


(tt) “Stock
Appreciation Right” or “SAR” means an Award granted under Section 8 of the Plan.


 


(uu) “Strike
Price” has the meaning given such term in Section 8(b) of the Plan.


 






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(vv) “Subsidiary”
means, with respect to any specified Person:


 


(i)
 any corporation, association or other business entity of which more than 50% of the total voting power of shares of such
entity’s voting securities (without regard to the occurrence of any contingency and after giving effect to any voting
agreement or stockholders’ agreement that effectively transfers voting power) is at the time owned or controlled, directly or
indirectly, by that Person or one or more of the other Subsidiaries of that Person (or a combination thereof); and


 


(ii)   any
partnership (or any comparable foreign entity) (A) the sole general partner (or functional equivalent thereof) or the managing general
partner of which is such Person or Subsidiary of such Person or (B) the only general partners (or functional equivalents thereof)
of which are that Person or one or more Subsidiaries of that Person (or any combination thereof).


 


(ww)  “Substitute
Award” has the meaning given such term in Section 5(e) of the Plan.


 


(xx) “Termination”
means the termination of a Participant’s employment or service, as applicable, with the Service Recipient; provided, however, that
with respect to any Participant who is an employee of the Manager or its Affiliates, such Participant shall be deemed to undergo a Termination
hereunder upon the first to occur of (i) a termination of the Management Agreement; and (ii) a termination of such Participant’s
employment or service, as applicable, with the Manager and its Affiliates.


 


3. Effective
Date; Duration.  The Plan shall be effective as of the Effective Date.  The expiration date of the Plan, on and after which
date no Awards may be granted hereunder, shall be the tenth (10th) anniversary of the Effective Date; provided, however, that
such expiration shall not affect Awards then outstanding, and the terms and conditions of the Plan shall continue to apply to such Awards.


 


4. Administration.


 


(a) The
Committee shall administer the Plan.  To the extent required to comply with the provisions of Rule 16b-3 promulgated under the
Exchange Act (if the Board is not acting as the Committee under the Plan), it is intended that each member of the Committee shall, at
the time he or she takes any action with respect to an Award under the Plan that is intended to qualify for the exemptions provided by
Rule 16b-3 promulgated under the Exchange Act be an Qualifying Director.  However, the fact that a Committee member shall fail
to qualify as a Qualifying Director shall not invalidate any Award granted by the Committee that is otherwise validly granted under the
Plan.


 


(b) Subject
to the provisions of the Plan and applicable law, the Committee shall have the sole and plenary authority, in addition to other express
powers and authorizations conferred on the Committee by the Plan, to: (i) designate Participants; (ii) determine the type or
types of Awards to be granted to a Participant; (iii) determine the number of shares of Common Stock to be covered by, or with respect
to which payments, rights, or other matters are to be calculated in connection with, Awards; (iv) determine the terms and conditions
of any Award; (v) determine whether, to what extent, and under what circumstances Awards may be settled in, or exercised for, cash,
shares of Common Stock, other securities, other Awards or other property, or canceled, forfeited, or suspended and the method or methods
by which Awards may be settled, exercised, canceled, forfeited, or suspended; (vi) determine whether, to what extent, and under what
circumstances the delivery of cash, shares of Common Stock, other securities, other Awards or other property and other amounts payable
with respect to an Award shall be deferred either automatically or at the election of the Participant or of the Committee; (vii) interpret,
administer, reconcile any inconsistency in, correct any defect in and/or supply any omission in the Plan and any instrument or agreement
relating to, or Award granted under, the Plan; (viii) establish, amend, suspend, or waive any rules and regulations and appoint
such agents as the Committee shall deem appropriate for the proper administration of the Plan; and (ix)  make any other determination
and take any other action that the Committee deems necessary or desirable for the administration of the Plan; and


 






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(c) Except
to the extent prohibited by applicable law or the applicable rules and regulations of any securities exchange or inter-dealer quotation
system on which the securities of the Company are listed or traded, the Committee may allocate all or any portion of its responsibilities
and powers to any one or more of its members and may delegate all or any part of its responsibilities and powers to any person or persons
selected by it.  Any such allocation or delegation may be revoked by the Committee at any time.  Without limiting the generality
of the foregoing, the Committee may delegate to one or more officers of any member of the Company Group, the authority to act on behalf
of the Committee with respect to any matter, right, obligation, or election which is the responsibility of, or which is allocated to,
the Committee herein, and which may be so delegated as a matter of law, except for grants of Awards to Non-Employee Directors.  Notwithstanding
the foregoing in this Section 4(c), it is intended that any action under the Plan intended to qualify for the exemptions provided
by Rule 16b-3 promulgated under the Exchange Act will be taken only by the Board or by a committee or subcommittee of two (2) or
more Qualifying Directors.  However, the fact that any member of such committee or subcommittee shall fail to qualify as a Qualifying
Director shall not invalidate any action that is otherwise valid under the Plan.


 


(d) Unless
otherwise expressly provided in the Plan, all designations, determinations, interpretations, and other decisions under or with respect
to the Plan or any Award or any documents evidencing Awards granted pursuant to the Plan shall be within the sole discretion of the Committee,
may be made at any time and shall be final, conclusive and binding upon all Persons, including, without limitation, any member of the
Company Group, any Participant, any holder or beneficiary of any Award, and any stockholder of the Company.


 


(e) No
member of the Board or the Committee or any employee or agent of any member of the Company Group (each such Person, an “Indemnifiable
Person”) shall be liable for any action taken or omitted to be taken or any determination made with respect to the Plan or any
Award hereunder (unless constituting fraud or a willful criminal act or omission).  Each Indemnifiable Person shall be indemnified
and held harmless by the Company against and from any loss, cost, liability, or expense (including attorneys’ fees) that may be
imposed upon or incurred by such Indemnifiable Person in connection with or resulting from any action, suit or proceeding to which such
Indemnifiable Person may be a party or in which such Indemnifiable Person may be involved by reason of any action taken or omitted to
be taken or determination made with respect to the Plan or any Award hereunder and against and from any and all amounts paid by such Indemnifiable
Person with the Company’s approval, in settlement thereof, or paid by such Indemnifiable Person in satisfaction of any judgment
in any such action, suit or proceeding against such Indemnifiable Person, and the Company shall advance to such Indemnifiable Person any
such expenses promptly upon written request (which request shall include an undertaking by the Indemnifiable Person to repay the amount
of such advance if it shall ultimately be determined, as provided below, that the Indemnifiable Person is not entitled to be indemnified); provided,
that the Company shall have the right, at its own expense, to assume and defend any such action, suit or proceeding and once the Company
gives notice of its intent to assume the defense, the Company shall have sole control over such defense with counsel of the Company’s
choice.  The foregoing right of indemnification shall not be available to an Indemnifiable Person to the extent that a final judgment
or other final adjudication (in either case not subject to further appeal) binding upon such Indemnifiable Person determines that the
acts, omissions or determinations of such Indemnifiable Person giving rise to the indemnification claim resulted from such Indemnifiable
Person’s fraud or willful criminal act or omission or that such right of indemnification is otherwise prohibited by law or by the
organizational documents of any member of the Company Group.  The foregoing right of indemnification shall not be exclusive of or
otherwise supersede any other rights of indemnification to which such Indemnifiable Persons may be entitled under the organizational documents
of any member of the Company Group, as a matter of law, under an individual indemnification agreement or contract or otherwise, or any
other power that the Company may have to indemnify such Indemnifiable Persons or hold such Indemnifiable Persons harmless.


 


(f)  Notwithstanding
anything to the contrary contained in the Plan, the Board may, in its sole discretion, at any time and from time to time, grant Awards
and administer the Plan with respect to such Awards.  Any such actions by the Board shall be subject to the applicable rules of
the securities exchange or inter-dealer quotation system on which the Common Stock is listed or quoted.  In any such case, the Board
shall have all the authority granted to the Committee under the Plan.


 






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5. Grant
of Awards; Shares Subject to the Plan; Limitations.


 


(a) The
Committee may, from time to time, grant Awards to one or more Eligible Persons.


 


(b) Awards
granted under the Plan shall be subject to the following limitations:  (i) subject to Section 11 of the Plan, no more than
8.5% of the issued and outstanding shares of Common Stock on a fully-diluted basis (assuming, if applicable, the exercise of all outstanding
Options and the conversion of all warrants and convertible securities into shares of Common Stock and any underwriter overallotment) immediately
following a Public Listing (the “Absolute Share Limit”) shall be available for Awards under the Plan; (ii) subject
to Section 11 of the Plan, grants of Options or SARs under the Plan in respect of no more than 50% of the Absolute Share Limit may
be made to any individual Participant during any single fiscal year of the Company (for this purpose, if a SAR is granted in tandem with
an Option (such that the SAR expires with respect to the number of shares of Common Stock for which the Option is exercised), only the
shares underlying the Option shall count against this limitation); (iii) subject to Section 11 of the Plan, no more than the
number of shares of Common Stock equal to the Absolute Share Limit may be issued in the aggregate pursuant to the exercise of Incentive
Stock Options granted under the Plan; and (iv) the maximum number of shares of Common Stock subject to Awards granted during a single
fiscal year to any Non-Employee Director, taken together with any cash fees paid to such Non-Employee Director during the fiscal year,
shall not exceed $200,000 in total value (calculating the value of any such Awards based on the grant date fair value of such Awards for
financial reporting purposes).


 


(c) Other
than with respect to Substitute Awards, to the extent that an Award expires or is canceled, forfeited, terminated, settled in cash, or
otherwise is settled without delivery to the Participant of the full number of shares of Common Stock to which the Award related, the
undelivered shares will again be available for grant.  Shares of Common Stock withheld in payment of the Exercise Price or Strike
Price, or taxes relating to an Award and shares equal to the number of shares surrendered in payment of any Exercise Price or Strike Price,
or taxes relating to an Award, shall be deemed to constitute shares not issued to the Participant and shall be deemed to again be available
for Awards under the Plan; provided, however, that such shares shall not become available for issuance hereunder if either:
(i) the applicable shares are withheld or surrendered following the termination of the Plan; or (ii) at the time the applicable
shares are withheld or surrendered, it would constitute a material revision of the Plan subject to stockholder approval under any then-applicable
rules of the national securities exchange on which the Common Stock is listed.


 


(d) Shares
of Common Stock issued by the Company in settlement of Awards may be authorized and unissued shares, shares held in the treasury of the
Company, shares purchased on the open market or by private purchase or a combination of the foregoing.


 


(e) Awards
may, in the sole discretion of the Committee, be granted under the Plan in assumption of, or in substitution for, outstanding awards previously
granted by an entity directly or indirectly acquired by the Company or with which the Company combines (“Substitute Awards”). 
Substitute Awards shall not be counted against the Absolute Share Limit; provided, that Substitute Awards issued in connection
with the assumption of, or in substitution for, outstanding options intended to qualify as “incentive stock options” within
the meaning of Section 422 of the Code shall be counted against the aggregate number of shares of Common Stock available for Awards
of Incentive Stock Options under the Plan.  Subject to applicable stock exchange requirements, available shares under a stockholder-approved
plan of an entity directly or indirectly acquired by the Company or with which the Company combines (as appropriately adjusted to reflect
the acquisition or combination transaction) may be used for Awards under the Plan and shall not reduce the number of shares of Common
Stock available for issuance under the Plan.


 


6. Eligibility. 
Participation in the Plan shall be limited to Eligible Persons.


 






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7. Options.


 


(a) General. 
Each Option granted under the Plan shall be evidenced by an Award Agreement, which agreement need not be the same for each Participant. 
Each Option so granted shall be subject to the conditions set forth in this Section 7, and to such other conditions not inconsistent
with the Plan as may be reflected in the applicable Award Agreement.  All Options granted under the Plan shall be Nonqualified Stock
Options unless the applicable Award Agreement expressly states that the Option is intended to be an Incentive Stock Option.  Incentive
Stock Options shall be granted only to Eligible Persons who are employees of the Company Group, and no Incentive Stock Option shall be
granted to any Eligible Person who is ineligible to receive an Incentive Stock Option under the Code.  No Option shall be treated
as an Incentive Stock Option unless the Plan has been approved by the stockholders of the Company in a manner intended to comply with
the stockholder approval requirements of Section 422(b)(1) of the Code, provided that any Option intended to
be an Incentive Stock Option shall not fail to be effective solely on account of a failure to obtain such approval, but rather such Option
shall be treated as a Nonqualified Stock Option unless and until such approval is obtained.  In the case of an Incentive Stock Option,
the terms and conditions of such grant shall be subject to, and comply with, such rules as may be prescribed by Section 422
of the Code.  If for any reason an Option intended to be an Incentive Stock Option (or any portion thereof) shall not qualify as
an Incentive Stock Option, then, to the extent of such nonqualification, such Option or portion thereof shall be regarded as a Nonqualified
Stock Option appropriately granted under the Plan.


 


(b) Exercise
Price.  Except as otherwise provided by the Committee in the case of Substitute Awards, the exercise price (“Exercise
Price”) per share of Common Stock for each Option shall not be less than 100% of the Fair Market Value of such share (determined
as of the Date of Grant); provided, however, that in the case of an Incentive Stock Option granted to an employee who, at
the time of the grant of such Option, owns stock representing more than 10% of the voting power of all classes of stock of any member
of the Company Group, the Exercise Price per share shall be no less than 110% of the Fair Market Value per share on the Date of Grant.


 


(c) Vesting
and Expiration; Termination.


 


(i)  Options
shall vest and become exercisable in such manner and on such date or dates or upon such event or events as determined by the Committee; provided, however,
that notwithstanding any such vesting dates or events, the Committee may in its sole discretion accelerate the vesting of any Options
at any time and for any reason. Options shall expire upon a date determined by the Committee, not to exceed ten (10) years from the
Date of Grant (the “Option Period”); provided, that if the Option Period (other than in the case of an
Incentive Stock Option) would expire at a time when trading in the shares of Common Stock is prohibited by the Company’s insider
trading policy (or Company-imposed “blackout period”), then the Option Period shall be automatically extended until the 30th day
following the expiration of such prohibition.  Notwithstanding the foregoing, in no event shall the Option Period exceed five (5) years
from the Date of Grant in the case of an Incentive Stock Option granted to a Participant who on the Date of Grant owns stock representing
more than 10% of the voting power of all classes of stock of any member of the Company Group.


 


(ii)   Unless
otherwise provided by the Committee, whether in an Award Agreement or otherwise, in the event of: (A) a Participant’s Termination
by the Service Recipient for Cause, all outstanding Options granted to such Participant shall immediately terminate and expire; (B) a
Participant’s Termination due to death or Disability, each outstanding unvested Option granted to such Participant shall immediately
terminate and expire, and each outstanding vested Option shall remain exercisable for one (1) year thereafter (but in no event beyond
the expiration of the Option Period); and (C) a Participant’s Termination for any other reason, each outstanding unvested Option
granted to such Participant shall immediately terminate and expire, and each outstanding vested Option shall remain exercisable for ninety
(90) days thereafter (but in no event beyond the expiration of the Option Period).


 


(d) Method
of Exercise and Form of Payment.  No shares of Common Stock shall be issued pursuant to any exercise of an Option until
payment in full of the Exercise Price therefor is received by the Company and the Participant has paid to the Company an amount equal
to any Federal, state, local and non-U.S. income, employment and any other applicable taxes required to be withheld.  Options which
have become exercisable may be exercised by delivery of written or electronic notice of exercise to the Company (or telephonic instructions
to the extent provided by the Committee) in accordance with the terms of the Option accompanied by payment of the Exercise Price. 
The Exercise Price shall be payable: (i) in cash, check, cash equivalent and/or shares of Common Stock valued at the Fair Market
Value at the time the Option is exercised (including, pursuant to procedures approved by the Committee, by means of attestation of ownership
of a sufficient number of shares of Common Stock in lieu of actual issuance of such shares to the Company); provided, that
such shares of Common Stock are not subject to any pledge or other security interest and have been held by the Participant for not less
than six (6) months (or such other period as established from time to time by the Committee in order to avoid adverse accounting
treatment applying generally accepted accounting principles (“GAAP”) or); or (ii) by such other method as the
Committee may permit in its sole discretion, including, without limitation: (A) in other property having a fair market value on the
date of exercise equal to the Exercise Price; (B) if there is a public market for the shares of Common Stock at such time, by means
of a broker-assisted “cashless exercise” pursuant to which the Company is delivered (including telephonically to the extent
permitted by the Committee) a copy of irrevocable instructions to a stockbroker to sell the shares of Common Stock otherwise issuable
upon the exercise of the Option and to deliver promptly to the Company an amount equal to the Exercise Price; or (C) a “net
exercise” procedure effected by withholding the minimum number of shares of Common Stock otherwise issuable in respect of an Option
that is needed to pay the Exercise Price.  Any fractional shares of Common Stock shall be settled in cash.


 






    8


     


    

 


(e) Notification
upon Disqualifying Disposition of an Incentive Stock Option.  Each Participant awarded an Incentive Stock Option under the Plan
shall notify the Company in writing immediately after the date he or she makes a disqualifying disposition of any Common Stock acquired
pursuant to the exercise of such Incentive Stock Option.  A disqualifying disposition is any disposition (including, without limitation,
any sale) of such Common Stock before the later of (i) two (2) years after the Date of Grant of the Incentive Stock Option or
(ii) one (1) year after the date of exercise of the Incentive Stock Option.  The Company may, if determined by the Committee
and in accordance with procedures established by the Committee, retain possession, as agent for the applicable Participant, of any Common
Stock acquired pursuant to the exercise of an Incentive Stock Option until the end of the period described in the preceding sentence,
subject to complying with any instructions from such Participant as to the sale of such Common Stock.


 


(f)  Compliance
with Laws, etc.  Notwithstanding the foregoing, in no event shall a Participant be permitted to exercise an Option in a
manner which the Committee determines would violate the Sarbanes-Oxley Act of 2002, as it may be amended from time to time, or any other
applicable law or the applicable rules and regulations of the Securities and Exchange Commission or the applicable rules and
regulations of any securities exchange or inter-dealer quotation system on which the securities of the Company are listed or traded.


 


8. Stock
Appreciation Rights.


 


(a) General. 
Each SAR granted under the Plan shall be evidenced by an Award Agreement.  Each SAR so granted shall be subject to the conditions
set forth in this Section 8, and to such other conditions not inconsistent with the Plan as may be reflected in the applicable Award
Agreement.  Any Option granted under the Plan may include tandem SARs.  The Committee also may award SARs to Eligible Persons
independent of any Option.


 


(b) Strike
Price.  Except as otherwise provided by the Committee in the case of Substitute Awards, the strike price (“Strike Price”)
per share of Common Stock for each SAR shall not be less than 100% of the Fair Market Value of such share (determined as of the Date of
Grant).  Notwithstanding the foregoing, a SAR granted in tandem with (or in substitution for) an Option previously granted shall
have a Strike Price equal to the Exercise Price of the corresponding Option.


 


(c) Vesting
and Expiration; Termination.


 


(i) A
SAR granted in connection with an Option shall become exercisable and shall expire according to the same vesting schedule and expiration
provisions as the corresponding Option.  A SAR granted independent of an Option shall vest and become exercisable in such manner
and on such date or dates or upon such event or events as determined by the Committee; provided, however, that
notwithstanding any such vesting dates or events, the Committee may, in its sole discretion, accelerate the vesting of any SAR at any
time and for any reason. SARs shall expire upon a date determined by the Committee, not to exceed ten (10) years from the Date of
Grant (the “SAR Period”); provided, that if the SAR Period would expire at a time when trading in the shares
of Common Stock is prohibited by the Company’s insider trading policy (or Company-imposed “blackout period”), then the
SAR Period shall be automatically extended until the 30th day following the expiration of such prohibition.


 


(ii) Unless
otherwise provided by the Committee, whether in an Award Agreement or otherwise, in the event of: (A) a Participant’s Termination
by the Service Recipient for Cause, all outstanding SARs granted to such Participant shall immediately terminate and expire; (B) a
Participant’s Termination due to death or Disability, each outstanding unvested SAR granted to such Participant shall immediately
terminate and expire, and each outstanding vested SAR shall remain exercisable for one (1) year thereafter (but in no event beyond
the expiration of the SAR Period); and (C) a Participant’s Termination for any other reason, each outstanding unvested SAR
granted to such Participant shall immediately terminate and expire, and each outstanding vested SAR shall remain exercisable for ninety
(90) days thereafter (but in no event beyond the expiration of the SAR Period).


 






    9


     


    

 


(d) Method
of Exercise.  SARs which have become exercisable may be exercised by delivery of written or electronic notice of exercise to
the Company in accordance with the terms of the Award, specifying the number of SARs to be exercised and the date on which such SARs were
awarded.


 


(e) Payment. 
Upon the exercise of a SAR, the Company shall pay to the Participant an amount equal to the number of shares subject to the SAR that is
being exercised multiplied by the excess of the Fair Market Value of one (1) share of Common Stock on the exercise date over the
Strike Price, less an amount equal to any Federal, state, local and non-U.S. income, employment and any other applicable taxes required
to be withheld.  The Company shall pay such amount in cash, in shares of Common Stock valued at Fair Market Value, or any combination
thereof, as determined by the Committee.  Any fractional shares of Common Stock shall be settled in cash.


 


9. Restricted
Stock and Restricted Stock Units.


 


(a) General. 
Each grant of Restricted Stock and Restricted Stock Units shall be evidenced by an Award Agreement.  Each Restricted Stock and Restricted
Stock Unit so granted shall be subject to the conditions set forth in this Section 9, and to such other conditions not inconsistent
with the Plan as may be reflected in the applicable Award Agreement.


 


(b) Stock
Certificates and Book-Entry; Escrow or Similar Arrangement.  Upon the grant of Restricted Stock, the Committee shall cause a
stock certificate registered in the name of the Participant to be issued or shall cause share(s) of Common Stock to be registered
in the name of the Participant and held in book-entry form subject to the Company’s directions and, if the Committee determines
that the Restricted Stock shall be held by the Company or in escrow rather than issued to the Participant pending the release of the applicable
restrictions, the Committee may require the Participant to additionally execute and deliver to the Company (i) an escrow agreement
satisfactory to the Committee, if applicable and (ii) the appropriate stock power (endorsed in blank) with respect to the Restricted
Stock covered by such agreement.  If a Participant shall fail to execute and deliver (in a manner permitted under Section 13(a) of
the Plan or as otherwise determined by the Committee) an agreement evidencing an Award of Restricted Stock and, if applicable, an escrow
agreement and blank stock power within the amount of time specified by the Committee, the Award shall be null and void.  Subject
to the restrictions set forth in this Section 9 and the applicable Award Agreement, a Participant generally shall have the rights
and privileges of a stockholder as to shares of Restricted Stock, including, without limitation, the right to vote such Restricted Stock; provided,
that if the lapsing of restrictions with respect to any grant of Restricted Stock is contingent on satisfaction of performance conditions
(other than, or in addition to, the passage of time), any dividends payable on such shares of Restricted Stock shall be held by the Company
and delivered (without interest) to the Participant within fifteen (15) days following the date on which the restrictions on such Restricted
Stock lapse (and the right to any such accumulated dividends shall be forfeited upon the forfeiture of the Restricted Stock to which such
dividends relate).  To the extent shares of Restricted Stock are forfeited, any stock certificates issued to the Participant evidencing
such shares shall be returned to the Company, and all rights of the Participant to such shares and as a stockholder with respect thereto
shall terminate without further obligation on the part of the Company.  A Participant shall have no rights or privileges as a stockholder
as to Restricted Stock Units.


 


(c) Vesting;
Termination.


 


(i) Restricted
Stock and Restricted Stock Units shall vest, and any applicable Restricted Period shall lapse, in such manner and on such date or dates
or upon such event or events as determined by the Committee; provided, however, that, notwithstanding any such
dates or events, the Committee may, in its sole discretion, accelerate the vesting of any Restricted Stock or Restricted Stock Unit or
the lapsing of any applicable Restricted Period at any time and for any reason.


 


(ii) Unless
otherwise provided by the Committee, whether in an Award Agreement or otherwise, in the event of a Participant’s Termination for
any reason prior to the time that such Participant’s Restricted Stock or Restricted Stock Units, as applicable, have vested, (A) all
vesting with respect to such Participant’s Restricted Stock or Restricted Stock Units, as applicable, shall cease and (B) unvested
shares of Restricted Stock and unvested Restricted Stock Units, as applicable, shall be forfeited to the Company by the Participant for
no consideration as of the date of such Termination.


 






    10


     


    

 


(d) Issuance
of Restricted Stock and Settlement of Restricted Stock Units.


 


(i) Upon
the expiration of the Restricted Period with respect to any shares of Restricted Stock, the restrictions set forth in the applicable Award
Agreement shall be of no further force or effect with respect to such shares, except as set forth in the applicable Award Agreement. 
If an escrow arrangement is used, upon such expiration, the Company shall issue to the Participant, or his or her beneficiary, without
charge, the stock certificate (or, if applicable, a notice evidencing a book-entry notation) evidencing the shares of Restricted Stock
which have not then been forfeited and with respect to which the Restricted Period has expired (rounded down to the nearest full share).
Dividends, if any, that may have been withheld by the Committee and attributable to any particular share of Restricted Stock shall be
distributed to the Participant in cash or, in the sole discretion of the Committee, in shares of Common Stock having a Fair Market Value
(on the date of distribution) equal to the amount of such dividends, upon the release of restrictions on such share and, if such share
is forfeited, the Participant shall have no right to such dividends.


 


(ii) Unless
otherwise provided by the Committee in an Award Agreement or otherwise, upon the expiration of the Restricted Period with respect to any
outstanding Restricted Stock Units, the Company shall issue to the Participant or his or her beneficiary, without charge, one (1) share
of Common Stock (or other securities or other property, as applicable) for each such outstanding Restricted Stock Unit; provided,
however, that the Committee may, in its sole discretion, elect to (A) pay cash or part cash and part shares of Common Stock in
lieu of issuing only shares of Common Stock in respect of such Restricted Stock Units; or (B) defer the issuance of shares of Common
Stock (or cash or part cash and part shares of Common Stock, as the case may be) beyond the expiration of the Restricted Period if such
extension would not cause adverse tax consequences under Section 409A of the Code.  If a cash payment is made in lieu of issuing
shares of Common Stock in respect of such Restricted Stock Units, the amount of such payment shall be equal to the Fair Market Value per
share of the Common Stock as of the date on which the Restricted Period lapsed with respect to such Restricted Stock Units.  To the
extent provided in an Award Agreement, the holder of outstanding Restricted Stock Units shall be entitled to be credited with dividend
equivalent payments (upon the payment by the Company of dividends on shares of Common Stock) either in cash or, in the sole discretion
of the Committee, in shares of Common Stock having a Fair Market Value equal to the amount of such dividends (and interest may, in the
sole discretion of the Committee, be credited on the amount of cash dividend equivalents at a rate and subject to such terms as determined
by the Committee), which accumulated dividend equivalents (and interest thereon, if applicable) shall be payable at the same time as the
underlying Restricted Stock Units are settled following the date on which the Restricted Period lapses with respect to such Restricted
Stock Units, and, if such Restricted Stock Units are forfeited, the Participant shall have no right to such dividend equivalent payments
(or interest thereon, if applicable).


 


(e) Legends
on Restricted Stock.  Each certificate, if any, or book entry representing Restricted Stock awarded under the Plan, if any, shall
bear a legend or book entry notation substantially in the form of the following, in addition to any other information the Company deems
appropriate, until the lapse of all restrictions with respect to such shares of Common Stock:


 


TRANSFER OF THIS CERTIFICATE AND
THE SHARES REPRESENTED HEREBY IS RESTRICTED PURSUANT TO THE TERMS OF THE CHICAGO ATLANTIC REAL ESTATE, INC. 2021 OMNIBUS INCENTIVE PLAN
AND A RESTRICTED STOCK AWARD AGREEMENT BETWEEN ATLANTIC CHICAGO REAL ESTATE FINANCE, INC. AND PARTICIPANT.  A COPY OF SUCH PLAN AND
AWARD AGREEMENT IS ON FILE AT THE PRINCIPAL EXECUTIVE OFFICES OF CHICAGO ATLANTIC REAL ESTATE FINANCE, INC.


 


10.  Other
Equity-Based Awards.  The Committee may grant Other Equity-Based Awards under the Plan to Eligible Persons, alone or in
tandem with other Awards, in such amounts and dependent on such conditions as the Committee shall from time to time in its sole discretion
determine.  Each Other Equity-Based Award granted under the Plan shall be evidenced by an Award Agreement.  Each Other Equity-Based
Award so granted shall be subject to such conditions not inconsistent with the Plan as may be reflected in the applicable Award Agreement
or other form evidencing such Award, including, without limitation, those set forth in Section 13(c) of the Plan.


 






    11


     


    

 


11.  Changes
in Capital Structure and Similar Events.  Notwithstanding any other provision in this Plan to the contrary, the following
provisions shall apply to all Awards granted hereunder:


 


(a) General. 
In the event of (i) any dividend (other than regular cash dividends) or other distribution (whether in the form of cash, shares of
Common Stock, other securities or other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation,
split-up, split-off, spin-off, combination, repurchase or exchange of shares of Common Stock or other securities of the Company, issuance
of warrants or other rights to acquire shares of Common Stock or other securities of the Company, or other similar corporate transaction
or event that affects the shares of Common Stock (including a Change in Control), or (ii) unusual or nonrecurring events affecting
the Company, including changes in applicable rules, rulings, regulations or other requirements, that the Committee determines, in its
sole discretion, could result in substantial dilution or enlargement of the rights intended to be granted to, or available for, Participants
(any event in (i) or (ii), an “Adjustment Event”), the Committee shall, in respect of any such Adjustment Event,
make such proportionate substitution or adjustment, if any, as it deems equitable, to any or all of (A) the Absolute Share Limit,
or any other limit applicable under the Plan with respect to the number of Awards which may be granted hereunder, (B) the number
of shares of Common Stock or other securities of the Company (or number and kind of other securities or other property) which may be issued
in respect of Awards or with respect to which Awards may be granted under the Plan, and (C) the terms of any outstanding Award, including,
without limitation, (I) the number of shares of Common Stock or other securities of the Company (or number and kind of other securities
or other property) subject to outstanding Awards or to which outstanding Awards relate, (II) the Exercise Price or Strike Price with
respect to any Award, or (III) any applicable performance measures; provided, that in the case of any “equity restructuring”
(within the meaning of the Financial Accounting Standards Board Accounting Standards Codification Topic 718 (or any successor pronouncement
thereto)), the Committee shall make an equitable or proportionate adjustment to outstanding Awards to reflect such equity restructuring. 
Any adjustment under this Section 11 shall be conclusive and binding for all purposes.


 


(b) Adjustment
Events.  Without limiting the foregoing, except as may otherwise be provided in an Award Agreement, in connection with any Adjustment
Event, the Committee may, in its sole discretion, provide for any one or more of the following:


 


(i) providing
for a substitution or assumption of Awards (or awards of an acquiring company), accelerating the exercisability of, lapse of restrictions
on, or termination of, Awards, or providing for a period of time (which shall not be required to be more than ten (10) days) for
Participants to exercise outstanding Awards prior to the occurrence of such event (and any such Award not so exercised shall terminate
upon the occurrence of such event); and


 


(ii)
subject to any limitations or reductions as may be necessary to comply with Section 409A of the Code, cancelling any one or more
outstanding Awards and causing to be paid to the holders of such Awards that are vested as of such cancellation (including, without limitation,
any Awards that would vest as a result of the occurrence of such event but for such cancellation or for which vesting is accelerated by
the Committee in connection with such event), the value of such Awards, if any, as determined by the Committee (which value, if applicable,
may be based upon the price per share of Common Stock received or to be received by other stockholders of the Company in such event),
including, without limitation, in the case of an outstanding Option or SAR, a cash payment in an amount equal to the excess, if any, of
the Fair Market Value (as of a date specified by the Committee) of the shares of Common Stock subject to such Option or SAR over the aggregate
Exercise Price or Strike Price of such Option or SAR (it being understood that, in such event, any Option or SAR having a per share Exercise
Price or Strike Price equal to, or in excess of, the Fair Market Value of a share of Common Stock subject thereto may be canceled and
terminated without any payment or consideration therefor), or, in the case of Restricted Stock, Restricted Stock Units or Other Equity-Based
Awards that are not vested as of such cancellation, a cash payment or equity subject to deferred vesting and delivery consistent with
the vesting restrictions applicable to such Restricted Stock, Restricted Stock Units or Other Equity-Based Awards prior to cancellation,
or the underlying shares in respect thereof.


 






    12


     


    

 


Payments to holders pursuant to clause (ii) above
shall be made in cash or, in the sole discretion of the Committee, in the form of such other consideration necessary for a Participant
to receive property, cash, or securities (or combination thereof) as such Participant would have been entitled to receive upon the occurrence
of the transaction if the Participant had been, immediately prior to such transaction, the holder of the number of shares of Common Stock
covered by the Award at such time (less any applicable Exercise Price or Strike Price).


 


(c) Other
Requirements.  Prior to any payment or adjustment contemplated under this Section 11, the Committee may require a Participant
to (i) represent and warrant as to the unencumbered title to his or her Awards, (ii) bear such Participant’s pro rata
share of any post-closing indemnity obligations, and be subject to the same post-closing purchase price adjustments, escrow terms, offset
rights, holdback terms, and similar conditions as the other holders of Common Stock, subject to any limitations or reductions as may be
necessary to comply with Section 409A of the Code, and (iii) deliver customary transfer documentation as reasonably determined
by the Committee.


 


(d) Fractional
Shares.  Any adjustment provided under this Section 11 may provide for elimination of any fractional share that might otherwise
become subject to an Award.


 


12.  Amendments
and Termination.


 


(a) Amendment
and Termination of the Plan.  The Board may amend, alter, suspend, discontinue, or terminate the Plan or any portion thereof
at any time; provided, that no such amendment, alteration, suspension, discontinuance or termination shall be made without
stockholder approval if: (i) such approval is necessary to comply with any regulatory requirement applicable to the Plan (including,
without limitation, as necessary to comply with any rules or regulations of any securities exchange or inter-dealer quotation system
on which the securities of the Company may be listed or quoted) or for changes in GAAP to new accounting standards; (ii) it would
materially increase the number of securities which may be issued under the Plan (except for increases pursuant to Section 5 or 12
of the Plan) or (iii) it would materially modify the requirements for participation in the Plan; provided, further, that
any such amendment, alteration, suspension, discontinuance or termination that would materially and adversely affect the rights of any
Participant or any holder or beneficiary of any Award theretofore granted shall not to that extent be effective without the consent of
the affected Participant, holder or beneficiary. 


 


(b) Amendment
of Award Agreements.  The Committee may, to the extent consistent with the terms of any applicable Award Agreement, waive any
conditions or rights under, amend any terms of, or alter, suspend, discontinue, cancel or terminate, any Award theretofore granted or
the associated Award Agreement, prospectively or retroactively (including after a Participant’s Termination); provided,
that, other than pursuant to Section 11, any such waiver, amendment, alteration, suspension, discontinuance, cancellation or termination
that would materially and adversely affect the rights of any Participant with respect to any Award theretofore granted shall not to that
extent be effective without the consent of the affected Participant; provided, further, that without stockholder approval,
except as otherwise permitted under Section 11 of the Plan, (i) no amendment or modification may reduce the Exercise Price of
any Option or the Strike Price of any SAR; (ii) the Committee may not cancel any outstanding Option or SAR and replace it with a
new Option or SAR (with a lower Exercise Price or Strike Price, as the case may be) or other Award or cash payment that is greater than
the intrinsic value (if any) of the cancelled Option or SAR and (iii) the Committee may not take any other action which is considered
a “repricing” for purposes of the stockholder approval rules of any securities exchange or inter-dealer quotation system
on which the securities of the Company are listed or quoted.


 


13.  General.


 


(a) Award
Agreements.  Each Award under the Plan shall be evidenced by an Award Agreement, which shall be delivered to the Participant
to whom such Award was granted and shall specify the terms and conditions of the Award and any rules applicable thereto, including,
without limitation, the effect on such Award of the death, Disability or Termination of a Participant, or of such other events as may
be determined by the Committee.  For purposes of the Plan, an Award Agreement may be in any such form (written or electronic) as
determined by the Committee (including, without limitation, a Board or Committee resolution, an employment agreement, a notice, a certificate
or a letter) evidencing the Award.  The Committee need not require an Award Agreement to be signed by the Participant or a duly authorized
representative of the Company.


 






    13


     


    

 


(b) Nontransferability.


 


(i)
Each Award shall be exercisable only by such Participant to whom such Award was granted during the Participant’s lifetime, or, if
permissible under applicable law, by the Participant’s legal guardian or representative.  No Award may be assigned, alienated,
pledged, attached, sold or otherwise transferred or encumbered by a Participant (unless such transfer is specifically required pursuant
to a domestic relations order or by applicable law) other than by will or by the laws of descent and distribution and any such purported
assignment, alienation, pledge, attachment, sale, transfer or encumbrance shall be void and unenforceable against the Company or any Affiliate; provided,
that the designation of a beneficiary shall not constitute an assignment, alienation, pledge, attachment, sale, transfer or encumbrance.


 


(ii)  
Notwithstanding the foregoing, the Committee may, in its sole discretion, permit Awards (other than Incentive Stock Options) to be transferred
by a Participant, without consideration, subject to such rules as the Committee may adopt consistent with any applicable Award Agreement
to preserve the purposes of the Plan, to: (A) any person who is a “family member” of the Participant, as such term is
used in the instructions to Form S-8 under the Securities Act or any successor form of registration statement promulgated by the
Securities and Exchange Commission (collectively, the “Immediate Family Members”); (B) a trust solely for the
benefit of the Participant and his or her Immediate Family Members; (C) a partnership or limited liability company whose only partners
or stockholders are the Participant and his or her Immediate Family Members; or (D) a beneficiary to whom donations are eligible
to be treated as “charitable contributions” for federal income tax purposes (each transferee described in clauses (A), (B),
(C) and (D) above is hereinafter referred to as a “Permitted Transferee”); provided, that the
Participant gives the Committee advance written notice describing the terms and conditions of the proposed transfer and the Committee
notifies the Participant in writing that such a transfer would comply with the requirements of the Plan.


 


(iii)
The terms of any Award transferred in accordance with clause (ii) above shall apply to the Permitted Transferee and any reference
in the Plan, or in any applicable Award Agreement, to a Participant shall be deemed to refer to the Permitted Transferee, except that:
(A) Permitted Transferees shall not be entitled to transfer any Award, other than by will or the laws of descent and distribution;
(B) Permitted Transferees shall not be entitled to exercise any transferred Option unless there shall be in effect a registration
statement on an appropriate form covering the shares of Common Stock to be acquired pursuant to the exercise of such Option if the Committee
determines, consistent with any applicable Award Agreement, that such a registration statement is necessary or appropriate; (C) neither
the Committee nor the Company shall be required to provide any notice to a Permitted Transferee, whether or not such notice is or would
otherwise have been required to be given to the Participant under the Plan or otherwise; and (D) the consequences of a Participant’s
Termination under the terms of the Plan and the applicable Award Agreement shall continue to be applied with respect to the Participant,
including, without limitation, that an Option shall be exercisable by the Permitted Transferee only to the extent, and for the periods,
specified in the Plan and the applicable Award Agreement.


 


(c) Dividends
and Dividend Equivalents.  The Committee may, in its sole discretion, provide a Participant as part of an Award with dividends,
dividend equivalents, or similar payments in respect of Awards, payable in cash, shares of Common Stock, other securities, other Awards
or other property, on a current or deferred basis, on such terms and conditions as may be determined by the Committee in its sole discretion,
including, without limitation, payment directly to the Participant, withholding of such amounts by the Company subject to vesting of the
Award or reinvestment in additional shares of Common Stock, Restricted Stock or other Awards; provided, that no dividends,
dividend equivalents or other similar payments shall be payable in respect of outstanding (i) Options or SARs; or (ii) unearned
Awards subject to performance conditions (other than, or in addition to, the passage of time) (although dividends, dividend equivalents
or other similar payments may be accumulated in respect of unearned Awards and paid within fifteen (15) days after such Awards are earned
and become payable or distributable).


 






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(d) Tax
Withholding.


 


(i)
A Participant shall be required to pay to the Service Recipient or any other member of the Company Group, and the Service Recipient or
any other member of the Company Group shall have the right and is hereby authorized to withhold, from any cash, shares of Common Stock,
other securities or other property issuable or deliverable under any Award or from any compensation or other amounts owing to a Participant,
the amount (in cash, shares of Common Stock, other securities or other property) of any required withholding or any other applicable taxes
in respect of an Award, its exercise, or any payment or transfer under an Award or under the Plan and to take such other action as may
be necessary in the opinion of the Committee or the Company to satisfy all obligations for the payment of such withholding or any other
applicable taxes.


 


(ii)
Without limiting the generality of clause (i) above, the Committee may (but is not obligated to), in its sole discretion, permit
a Participant to satisfy, in whole or in part, the foregoing withholding liability by (A) the delivery of shares of Common Stock
(which are not subject to any pledge or other security interest) that have been held by the Participant for not less than six (6) months
(or such other period as established from time to time by the Committee in order to avoid adverse accounting treatment applying GAAP)
having a Fair Market Value equal to such withholding liability or (B) having the Company withhold from the number of shares of Common
Stock otherwise issuable or deliverable pursuant to the exercise or settlement of the Award a number of shares with a Fair Market Value
equal to such withholding liability, provided that with respect to shares withheld pursuant to clause (B), the number of such shares may
not have a Fair Market Value greater than the minimum required statutory withholding liability.


 


(e) Data
Protection.  By participating in the Plan or accepting any rights granted under it, each Participant consents to the collection
and processing of personal data relating to the Participant so that the Company and its Affiliates can fulfill their obligations and exercise
their rights under the Plan and generally administer and manage the Plan.  This data will include, but may not be limited to, data
about participation in the Plan and shares offered or received, purchased, or sold under the Plan from time to time and other appropriate
financial and other data (such as the date on which the Awards were granted) about the Participant and his or her participation in the
Plan.


 


(f)  No
Claim to Awards; No Rights to Continued Employment; Waiver.  No employee of the Company or any other member of the Company Group,
or other person, shall have any claim or right to be granted an Award under the Plan or, having been selected for the grant of an Award,
to be selected for a grant of any other Award.  There is no obligation for uniformity of treatment of Participants or holders or
beneficiaries of Awards.  The terms and conditions of Awards and the Committee’s determinations and interpretations with respect
thereto need not be the same with respect to each Participant and may be made selectively among Participants, whether or not such Participants
are similarly situated.  Neither the Plan nor any action taken hereunder shall be construed as giving any Participant any right to
be retained in the employ or service of the Service Recipient or any other member of the Company Group, nor shall it be construed as giving
any Participant any rights to continued service on the Board.  The Service Recipient or any other member of the Company Group may
at any time dismiss a Participant from employment or discontinue any consulting relationship, free from any liability or any claim under
the Plan, unless otherwise expressly provided in the Plan or any Award Agreement.  By accepting an Award under the Plan, a Participant
shall thereby be deemed to have waived any claim to continued exercise or vesting of an Award or to damages or severance entitlement related
to non-continuation of the Award beyond the period provided under the Plan or any Award Agreement, except to the extent of any provision
to the contrary in any written employment contract or other agreement between the Service Recipient and/or any member of the Company Group
and the Participant, whether any such agreement is executed before, on or after the Date of Grant.


 






    15


     


    

 


(g) Designation
and Change of Beneficiary.  Each Participant may file with the Committee a written designation of one or more Persons as the
beneficiary(ies) who shall be entitled to receive the amounts payable with respect to an Award, if any, due under the Plan upon his or
her death.  A Participant may, from time to time, revoke or change his or her beneficiary designation without the consent of any
prior beneficiary by filing a new designation with the Committee.  The last such designation received by the Committee shall be controlling; provided,
however, that no designation, or change or revocation thereof, shall be effective unless received by the Committee prior to the Participant’s
death, and in no event shall it be effective as of a date prior to such receipt.  If no beneficiary designation is filed by a Participant,
the beneficiary shall be deemed to be his or her spouse or, if the Participant is unmarried at the time of death, his or her estate.


 


(h)  Termination. 
Except as otherwise provided in an Award Agreement, unless determined otherwise by the Committee at any point following such event: (i) neither
a temporary absence from employment or service due to illness, vacation or leave of absence (including, without limitation, a call to
active duty for military service through a Reserve or National Guard unit) nor a transfer from employment or service with one Service
Recipient to employment or service with another Service Recipient (or vice-versa) shall be considered a Termination; and (ii) if
a Participant undergoes a Termination of employment, but such Participant continues to provide services to the Company Group in a non-employee
capacity, such change in status shall not be considered a Termination for purposes of the Plan.  Further, unless otherwise determined
by the Committee, in the event that any Service Recipient ceases to be a member of the Company Group (by reason of sale, divestiture,
spin-off or other similar transaction), unless a Participant’s employment or service is transferred to another entity that would
constitute a Service Recipient immediately following such transaction, such Participant shall be deemed to have suffered a Termination
hereunder as of the date of the consummation of such transaction.


 


(i)  No
Rights as a Stockholder.  Except as otherwise specifically provided in the Plan or any Award Agreement, no Person shall be entitled
to the privileges of ownership in respect of shares of Common Stock that are subject to Awards hereunder until such shares have been issued
or delivered to such Person.


 


(j) Government
and Other Regulations.


 


(i)   
The obligation of the Company to settle Awards in shares of Common Stock or other consideration shall be subject to all applicable laws,
rules, and regulations, and to such approvals by governmental agencies as may be required.  Notwithstanding any terms or conditions
of any Award to the contrary, the Company shall be under no obligation to offer to sell or to sell, and shall be prohibited from offering
to sell or selling, any shares of Common Stock pursuant to an Award unless such shares have been properly registered for sale pursuant
to the Securities Act with the Securities and Exchange Commission or unless the Company has received an opinion of counsel (if the Company
has requested such an opinion), satisfactory to the Company, that such shares may be offered or sold without such registration pursuant
to an available exemption therefrom and the terms and conditions of such exemption have been fully complied with.  The Company shall
be under no obligation to register for sale under the Securities Act any of the shares of Common Stock to be offered or sold under the
Plan.  The Committee shall have the authority to provide that all shares of Common Stock or other securities of the Company or any
other member of the Company Group issued under the Plan shall be subject to such stop transfer orders and other restrictions as the Committee
may deem advisable under the Plan, the applicable Award Agreement, the Federal securities laws, the rules, regulations and other requirements
of the Securities and Exchange Commission, any securities exchange or inter-dealer quotation system on which the securities of the Company
are listed or quoted and any other applicable Federal, state, local or non-U.S. laws, rules, regulations and other requirements, and,
without limiting the generality of Section 9 of the Plan, the Committee may cause a legend or legends to be put on certificates representing
shares of Common Stock or other securities of the Company or any other member of the Company Group issued under the Plan to make appropriate
reference to such restrictions or may cause such Common Stock or other securities of the Company or any other member of the Company Group
issued under the Plan in book-entry form to be held subject to the Company’s instructions or subject to appropriate stop-transfer
orders.  Notwithstanding any provision in the Plan to the contrary, the Committee reserves the right to add any additional terms
or provisions to any Award granted under the Plan that the Committee, in its sole discretion, deems necessary or advisable in order that
such Award complies with the legal requirements of any governmental entity to whose jurisdiction the Award is subject.


 






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(ii)  
The Committee may cancel an Award or any portion thereof if it determines, in its sole discretion, that legal or contractual restrictions
and/or blockage and/or other market considerations would make the Company’s acquisition of shares of Common Stock from the public
markets, the Company’s issuance of Common Stock to the Participant, the Participant’s acquisition of Common Stock from the
Company and/or the Participant’s sale of Common Stock to the public markets, illegal, impracticable or inadvisable.  If the
Committee determines to cancel all or any portion of an Award in accordance with the foregoing, the Company shall, subject to any limitations
or reductions as may be necessary to comply with Section 409A of the Code, (A) pay to the Participant an amount equal to the
excess of (I) the aggregate Fair Market Value of the shares of Common Stock subject to such Award or portion thereof canceled (determined
as of the applicable exercise date, or the date that the shares would have been vested or issued, as applicable), over (II) the aggregate
Exercise Price or Strike Price (in the case of an Option or SAR, respectively) or any amount payable as a condition of issuance of shares
of Common Stock (in the case of any other Award).  Such amount shall be delivered to the Participant as soon as practicable following
the cancellation of such Award or portion thereof, or (B) in the case of Restricted Stock, Restricted Stock Units or Other Equity-Based
Awards, provide the Participant with a cash payment or equity subject to deferred vesting and delivery consistent with the vesting restrictions
applicable to such Restricted Stock, Restricted Stock Units or Other Equity-Based Awards, or the underlying shares in respect thereof.


 


(k)  No
Section 83(b) Elections without Consent of Company.  No election under Section 83(b) of the Code or under
a similar provision of law may be made unless expressly permitted by the terms of the applicable Award Agreement or by action of the Committee
in writing prior to the making of such election.  If a Participant, in connection with the acquisition of shares of Common Stock
under the Plan or otherwise, is expressly permitted to make such election and the Participant makes the election, the Participant shall
notify the Company of such election within ten (10) days of filing notice of the election with the Internal Revenue Service or other
governmental authority, in addition to any filing and notification required pursuant to Section 83(b) of the Code or other applicable
provision.


 


(l)  Payments
to Persons Other Than Participants.  If the Committee shall find that any person to whom any amount is payable under the Plan
is unable to care for his or her affairs because of illness or accident, or is a minor, or has died, then any payment due to such person
or his or her estate (unless a prior claim therefor has been made by a duly appointed legal representative) may, if the Committee so directs
the Company, be paid to his or her spouse, child, relative, an institution maintaining or having custody of such Person, or any other
person deemed by the Committee to be a proper recipient on behalf of such Person otherwise entitled to payment.  Any such payment
shall be a complete discharge of the liability of the Committee and the Company therefor.


 


(m) Nonexclusivity
of the Plan.  Neither the adoption of the Plan by the Board nor the submission of the Plan to the stockholders of the Company
for approval shall be construed as creating any limitations on the power of the Board to adopt such other incentive arrangements as it
may deem desirable, including, without limitation, the granting of equity awards otherwise than under the Plan, and such arrangements
may be either applicable generally or only in specific cases.


 


(n) No
Trust or Fund Created.  Neither the Plan nor any Award shall create or be construed to create a trust or separate fund of any
kind or a fiduciary relationship between the Company or any other member of the Company Group, on the one hand, and a Participant or other
person or entity, on the other hand.  No provision of the Plan or any Award shall require the Company, for the purpose of satisfying
any obligations under the Plan, to purchase assets or place any assets in a trust or other entity to which contributions are made or otherwise
to segregate any assets, nor shall the Company be obligated to maintain separate bank accounts, books, records or other evidence of the
existence of a segregated or separately maintained or administered fund for such purposes.  Participants shall have no rights under
the Plan other than as unsecured general creditors of the Company, except that insofar as they may have become entitled to payment of
additional compensation by performance of services, they shall have the same rights as other service providers under general law.


 


(o) Reliance
on Reports.  Each member of the Committee and each member of the Board shall be fully justified in acting or failing to act,
as the case may be, and shall not be liable for having so acted or failed to act in good faith, in reliance upon any report made by the
independent public accountant of the Company or any other member of the Company Group and/or any other information furnished in connection
with the Plan by any agent of the Company or the Committee or the Board, other than himself or herself.


 






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(p) Relationship
to Other Benefits.  No payment under the Plan shall be taken into account in determining any benefits under any pension, retirement,
profit sharing, group insurance or other benefit plan of the Company except as otherwise specifically provided in such other plan or as
required by applicable law.


 


(q)  Governing
Law.  The Plan shall be governed by and construed in accordance with the internal laws of the State of Maryland applicable to
contracts made and performed wholly within the State of Maryland, without giving effect to the conflict of laws provisions thereof. 
EACH PARTICIPANT WHO ACCEPTS AN AWARD IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY SUIT, ACTION, OR OTHER PROCEEDING INSTITUTED
BY OR AGAINST SUCH PARTICIPANT IN RESPECT OF HIS OR HER RIGHTS OR OBLIGATIONS HEREUNDER.


 


(r)  Severability. 
If any provision of the Plan or any Award or Award Agreement is or becomes or is deemed to be invalid, illegal, or unenforceable in any
jurisdiction or as to any Person or Award, or would disqualify the Plan or any Award under any law deemed applicable by the Committee,
such provision shall be construed or deemed amended to conform to the applicable laws, or if it cannot be construed or deemed amended
without, in the determination of the Committee, materially altering the intent of the Plan or the Award, such provision shall be construed
or deemed stricken as to such jurisdiction, person or entity or Award and the remainder of the Plan and any such Award shall remain in
full force and effect.


 


(s)  Obligations
Binding on Successors.  The obligations of the Company under the Plan shall be binding upon any successor corporation or organization
resulting from the merger, consolidation or other reorganization of the Company, or upon any successor corporation or organization succeeding
to substantially all of the assets and business of the Company.


 


(t) Section 409A
of the Code.


 


(i)   
Notwithstanding any provision of the Plan to the contrary, it is intended that the provisions of the Plan comply with Section 409A
of the Code, and all provisions of the Plan shall be construed and interpreted in a manner consistent with the requirements for avoiding
taxes or penalties under Section 409A of the Code.  Each Participant is solely responsible and liable for the satisfaction of
all taxes and penalties that may be imposed on or in respect of such Participant in connection with the Plan (including any taxes and
penalties under Section 409A of the Code), and neither the Service Recipient nor any other member of the Company Group shall have
any obligation to indemnify or otherwise hold such Participant (or any beneficiary) harmless from any or all of such taxes or penalties. 
With respect to any Award that is considered “deferred compensation” subject to Section 409A of the Code, references
in the Plan to “termination of employment” (and substantially similar phrases) shall mean “separation from service”
within the meaning of Section 409A of the Code.  For purposes of Section 409A of the Code, each of the payments that may
be made in respect of any Award granted under the Plan is designated as a separate payment.


 


(ii)  
Notwithstanding anything in the Plan to the contrary, if a Participant is a “specified employee” within the meaning of Section 409A(a)(2)(B)(i) of
the Code, no payments in respect of any Awards that are “deferred compensation” subject to Section 409A of the Code and
which would otherwise be payable upon the Participant’s “separation from service” (as defined in Section 409A of
the Code) shall be made to such Participant prior to the date that is six (6) months after the date of such Participant’s “separation
from service” or, if earlier, the date of the Participant’s death.  Following any applicable six (6) month delay,
all such delayed payments will be paid in a single lump sum on the earliest date permitted under Section 409A of the Code that is
also a business day.


 






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(iii)
Unless otherwise provided by the Committee in an Award Agreement or otherwise, in the event that the timing of payments in respect of
any Award (that would otherwise be considered “deferred compensation” subject to Section 409A of the Code) would be accelerated
upon the occurrence of (A) a Change in Control, no such acceleration shall be permitted unless the event giving rise to the Change
in Control satisfies the definition of a change in the ownership or effective control of a corporation, or a change in the ownership of
a substantial portion of the assets of a corporation pursuant to Section 409A of the Code or (B) a Disability, no such acceleration
shall be permitted unless the Disability also satisfies the definition of “Disability” pursuant to Section 409A of the
Code.


 


(u) REIT
Status. The Plan shall be interpreted and construed in a manner consistent with the Company’s status as a real estate investment
trust under Sections 856 through 860 of the Code (a “REIT”). No award shall be granted or awarded, and with respect to any
Award granted under the Plan, such Award shall not vest, be exercisable or be settled (i) to the extent that the grant, vesting, exercise
or settlement of such Award could cause the Participant or any other person to be in violation of Section 7.2.1(a) of the Company’s
charter; or (ii) if, in the discretion of the Administrator, the grant, vesting, exercise or settlement of such Award could impair the
Company’s status as a REIT.


 


(v) Clawback/Repayment. 
All Awards shall be subject to reduction, cancellation, forfeiture or recoupment to the extent necessary to comply with (A) any clawback,
forfeiture or other similar policy adopted by the Board or Committee and as in effect from time to time, and (B) applicable law. 
Further, to the extent that the Participant receives any amount in excess of the amount that the Participant should otherwise have received
under the terms of the Award for any reason (including, without limitation, by reason of a financial restatement, mistake in calculations
or other administrative error), the Participant shall be required to repay any such excess amount to the Company.


 


(w) Right
of Offset.  The Company will have the right to offset against its obligation to deliver shares of Common Stock (or other
property or cash) under the Plan or any Award Agreement any outstanding amounts (including, without limitation, travel and entertainment
or advance account balances, loans, repayment obligations under any Awards, or amounts repayable to the Company pursuant to tax equalization,
housing, automobile or other employee programs) that the Participant then owes to the Company or any other member of the Company Group,
as applicable, and any amounts the Committee otherwise deems appropriate pursuant to any tax equalization policy or agreement.  Notwithstanding
the foregoing, if an Award is “deferred compensation” subject to Section 409A of the Code, the Committee will have no
right to offset against its obligation to deliver shares of Common Stock (or other property or cash) under the Plan or any Award Agreement
if such offset could subject the Participant to the additional tax imposed under Section 409A of the Code in respect of an outstanding
Award.


 


(x)   Expenses;
Gender; Titles and Headings.  The expenses of administering the Plan shall be borne by the Company Group.  Masculine pronouns
and other words of masculine gender shall refer to both men and women.  The titles and headings of the sections in the Plan are for
convenience of reference only, and in the event of any conflict, the text of the Plan, rather than such titles or headings, shall control.


 


 


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