Exhibit 4.1 


 


DESCRIPTION
OF CAPITAL STOCK


 


The following is
a summary of the material terms of our securities registered under Section 12 of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), as of December 31, 2019, and provisions of our charter and bylaws. The summary is subject
to and qualified in its entirely by reference to the charter and bylaws, each of which is incorporated by reference as an exhibit
to the Annual Report on Form 10-K of which this exhibit is a part. The following also summarizes certain provisions of the
Maryland General Corporation Law (the “MGCL”) and is subject to and qualified in its entirely by reference to the MGCL.


 


General


 


Pursuant
to our charter, we are currently authorized to designate and issue up to 500,000,000 shares of common stock, $0.01 par value per
share (our “common stock”), and 100,000,000 shares of preferred stock, $0.01 par value per share (our “preferred
stock”). A majority of our entire board of directors has the power, without stockholder approval, to amend our charter to
increase or decrease the aggregate number of shares of stock or the number of shares of stock of any class or series that we are
authorized to issue.


 


As
of February 14, 2020, we had 7,904,006 shares of our common stock outstanding.


 


Description
of Common Stock


 


General


 


Our charter provides
that we have authority to issue up to 500,000,000 shares of common stock. Under Maryland law, stockholders generally are not liable
for a corporation’s debts or obligations solely as a result of their status as stockholders.


 


Distribution, Liquidation and Other
Rights


 


Stockholders
are entitled to receive distributions when authorized by our board of directors and declared by us out of assets legally available
for the payment of dividends. Stockholders are also entitled to share ratably in our assets legally available for distribution
to our stockholders in the event of our liquidation, dissolution, or winding up, after payment of, or adequate provision for, all
of our known debts and liabilities. These rights are subject to the preferential rights of any other class or series of our stock,
including any shares of preferred stock we may issue, and to the provisions of our charter regarding restrictions on ownership
and transfer of our stock. See “Restrictions on Ownership and Transfer.”


 


Our
common stockholders have no preference, conversion, exchange, sinking fund or redemption rights and have no preemptive rights to
subscribe for any of our capital stock. Our charter provides that our stockholders generally have no appraisal rights unless our
board of directors determines that appraisal rights will apply to one or more transactions in which our common stockholders would
otherwise be entitled to exercise such rights. Subject to our charter restrictions on ownership and transfer of our stock, holders
of shares of our common stock have equal dividend, liquidation and other rights.


 


Voting Rights


 


Subject
to our charter restrictions on ownership and transfer of our stock and the terms of any other class or series of our stock, each
outstanding share of our common stock entitles the holder thereof to one vote on all matters submitted to a vote of stockholders,
including the election of directors. Cumulative voting in the election of directors is not permitted. Directors will be elected
by a plurality of the votes cast at the meeting in which directors are being elected and at which a quorum is present. This means
that the holders of a majority of the outstanding shares of our common stock can effectively elect all of the directors then standing
for election, and the holders of the remaining shares will not be able to elect any directors.


 






     


     


    

 


Power to Classify and Reclassify
Unissued Stock


 


Our
charter authorizes our board of directors to reclassify any unissued shares of our common stock into other classes or series of
stock, including classes or series of preferred stock, and to establish the designation and number of shares of each such class
or series and to set, subject to the provisions of our charter regarding the restrictions on ownership and transfer of our stock,
the preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications
or terms or conditions of redemption of each such class or series. Thus, our board of directors could authorize the issuance of
shares of common stock or preferred stock with terms and conditions which could have the effect of delaying, deferring or preventing
a transaction or a change in control that might involve a premium price for our common stock or that our common stockholders otherwise
believe to be in their best interests.


 


Listing


 


Our
common stock is listed on the New York Stock Exchange under the trading symbol “PINE.”


 


Transfer Agent and Registrar


 


The transfer agent
and registrar for our common stock is Computershare Trust Company, N.A.


 


Certain Provisions of Maryland Law and
of Our Charter and Bylaws


 


Our Board of Directors


 


Under
our charter and bylaws, the number of directors of our company may be established, increased or decreased only by a majority of
our entire board of directors but may not be fewer than the minimum number required under the MGCL (which is one) nor, unless our
bylaws are amended, more than 15.


 


Removal of Directors


 


Our
charter provides that, subject to the rights of holders of one or more classes or series of preferred stock to elect or remove
one or more directors, a director may be removed only for cause (as defined in our charter) and only by the affirmative vote of
at least two-thirds of the votes entitled to be cast generally in the election of directors.


 


Business Combinations


 


Under
the MGCL, certain “business combinations” (including a merger, consolidation, statutory share exchange or, in certain
circumstances specified under the statute, an asset transfer or issuance or reclassification of equity securities) between a Maryland
corporation and any interested stockholder, or an affiliate of such an interested stockholder, are prohibited for five years after
the most recent date on which the interested stockholder becomes an interested stockholder. Maryland law defines an interested
stockholder as:


 


	·	any person who beneficially owns, directly or indirectly, 10% or more of the voting power of the
corporation’s outstanding voting stock; or


 


	·	an affiliate or associate of the corporation who, at any time within the two-year period
prior to the date in question, was the beneficial owner of 10% or more of the voting power of the then-outstanding voting stock
of the corporation.


 


A
person is not an interested stockholder under the MGCL if the board of directors approved in advance the transaction by which the
person otherwise would have become an interested stockholder. In approving a transaction, the board of directors may provide that
its approval is subject to compliance, at or after the time of the approval, with any terms and conditions determined by it.


 






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After
such five-year period, any such business combination must be recommended by the board of directors of the corporation and approved
by the affirmative vote of at least:


 


	·	80% of the votes entitled to be cast by holders of outstanding
shares of voting stock of the corporation; and


 


	·	two-thirds of the votes entitled to be cast by holders of voting stock of the corporation other
than shares held by the interested stockholder with whom (or with whose affiliate) the business combination is to be effected
or held by an affiliate or associate of the interested stockholder.


 


These
supermajority approval requirements do not apply if, among other conditions, the corporation’s common stockholders receive
a minimum price (as defined in the MGCL) for their shares and the consideration is received in cash or in the same form as previously
paid by the interested stockholder for its shares.


 


These
provisions of the MGCL do not apply, however, to business combinations that are approved or exempted by a corporation’s board
of directors prior to the time that the interested stockholder becomes an interested stockholder. As permitted by the MGCL, our
board of directors has adopted a resolution exempting any business combination between us and any other person from the provisions
of this statute. Consequently, the five-year prohibition and the supermajority vote requirements will not apply to business combinations
involving us. As a result, any person will be able to enter into business combinations with us that may not be in the best interests
of our stockholders, without compliance with the supermajority vote requirements and other provisions of the statute. However,
our board of directors may repeal or modify this resolution at any time in the future, in which case the applicable provisions
of the MGCL will become applicable to business combinations between us and interested stockholders.


 


Control Share Acquisitions


 


The
MGCL provides that a holder of “control shares” of a Maryland corporation acquired in a “control share acquisition”
has no voting rights with respect to those shares except to the extent approved by the affirmative vote of at least two-thirds of
the votes entitled to be cast by stockholders entitled to exercise or direct the exercise of the voting power in the election of
directors generally but excluding: (1) the person who has made or proposes to make the control share acquisition; (2) any
officer of the corporation; or (3) any employee of the corporation who is also a director of the corporation. “Control
shares” are voting shares of stock that, if aggregated with all other such shares of stock previously acquired by the acquirer
or in respect of which the acquirer is able to exercise or direct the exercise of voting power (except solely by virtue of a revocable
proxy), would entitle the acquirer to exercise voting power in electing directors within one of the following ranges:


 


	·         one-tenth or more but less than one-third;


 


	·         one-third or more but less than a majority; or


 


	·         a majority or more of all voting power.


 


Control
shares do not include shares that the acquiring person is then entitled to vote as a result of having previously obtained stockholder
approval. A “control share acquisition” means the acquisition, directly or indirectly, of ownership of, or the power
to direct the exercise of voting power with respect to, issued and outstanding control shares, subject to certain exceptions.


 


A
person who has made or proposes to make a control share acquisition, upon satisfaction of certain conditions (including an undertaking
to pay expenses and making an “acquiring person statement” as described in the MGCL), may compel the board of directors
of the company to call a special meeting of stockholders to be held within 50 days of demand to consider the voting rights of the
control shares. If no request for a special meeting is made, the corporation may itself present the question at any stockholders
meeting.


 






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If
voting rights of control shares are not approved at the meeting or if the acquiring person does not deliver an “acquiring
person statement” as required by the statute, then, subject to certain conditions and limitations, the corporation may redeem
any or all of the control shares (except those for which voting rights have previously been approved) for fair value determined,
without regard to the absence of voting rights for the control shares, as of the date of the last control share acquisition by
the acquirer or, if a meeting of stockholders at which the voting rights of such shares are considered and not approved is held,
as of the date of such meeting. If voting rights for control shares are approved at a stockholders meeting and the acquirer becomes
entitled to vote a majority of the shares entitled to vote, all other stockholders may exercise appraisal rights. The fair value
of the shares as determined for purposes of such appraisal rights may not be less than the highest price per share paid by the
acquirer in the control share acquisition.


 


The
control share acquisition statute does not apply (1) to shares acquired in a merger, consolidation or statutory share exchange
if the corporation is a party to the transaction or (2) to acquisitions approved or exempted by the charter or bylaws of the
corporation.


 


Our
bylaws contain a provision exempting from the control share acquisition statute any and all control share acquisitions by any person
of shares of our stock. There can be no assurance that such provision will not be amended or eliminated at any time in the future
by our board of directors.


 


Subtitle 8


 


Subtitle
8 of Title 3 of the MGCL permits a Maryland corporation with a class of equity securities registered under the Exchange Act and
at least three independent directors to elect, by provision in its charter or bylaws or a resolution of its board of directors
and notwithstanding any contrary provision in the charter or bylaws, to be subject to any or all of the following five provisions:


 


	·	a classified board;


 


	·	a two-thirds vote requirement for removing a director;


 


	·	a requirement that the number of directors be fixed only by vote of the directors;


 


	·	a requirement that a vacancy on the board be filled
only by a vote of the remaining directors (whether or not they constitute a quorum) and for the remainder of the full term of
the class of directors in which the vacancy occurred and until a successor is elected and qualifies; or


 


	·	a majority requirement for the calling of a special meeting of stockholders.


 


Our
charter provides that, effective at such time as we are able to make a Subtitle 8 election, vacancies on our board of directors
may be filled only by the remaining directors (whether or not they constitute a quorum) and that a director elected by the board
of directors to fill a vacancy will serve for the remainder of the full term of the directorship. We have not elected to be subject
to any of the other provisions of Subtitle 8, including the provisions that would permit us to classify our board of directors
without stockholder approval. Moreover, our charter provides that, without the affirmative vote of a majority of the votes cast
on the matter by stockholders entitled to vote generally in the election of directors, we may not elect to be subject to any of
these additional provisions of Subtitle 8. Through provisions in our charter and bylaws unrelated to Subtitle 8, we
(1) vest in our board of directors the exclusive power to fix the number of directors, (2) require, unless called by
our chairman, our chief executive officer, our president or our board of directors, the request of stockholders entitled to cast
not less than a majority of all the votes entitled to be cast at the meeting to call a special meeting of stockholders and (3) provide
that a director may be removed only for cause and by the affirmative vote of two-thirds of the votes entitled to be cast
generally in the election of directors.


 






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Amendments to Our Charter and Bylaws


 


Except
as described herein and as provided in the MGCL, amendments to our charter must be advised by our board of directors and approved
by the affirmative vote of our stockholders entitled to cast a majority of all of the votes entitled to be cast on the matter.
Our board of directors has the exclusive power to amend our bylaws.


 


Meetings of Stockholders


 


Under
our bylaws and pursuant to Maryland law, annual meetings of stockholders will be held each year at a date and at the time and place
determined by our board of directors. Special meetings of stockholders may be called by our board of directors, the chairman of
our board of directors, our president or our chief executive officer. Additionally, subject to the provisions of our bylaws, special
meetings of the stockholders to act on any matter must be called by our secretary upon the written request of stockholders entitled
to cast a majority of all the votes entitled to be cast on such matter at such meeting who have requested the special meeting in
accordance with the procedures set forth in, and provided the information and certifications required by, our bylaws. Only matters
set forth in the notice of the special meeting may be considered and acted upon at such a meeting. Our secretary will inform the
requesting stockholders of the reasonably estimated cost of preparing and delivering the notice of meeting (including our proxy
materials), and the requesting stockholder must pay such estimated cost before our secretary may prepare and deliver the notice
of the special meeting.


 


Corporate Opportunities


 


Our
charter provides that, to the maximum extent permitted by Maryland law, each of Consolidated-Tomoka Land Co., a Florida corporation
(“CTO”), its affiliates, each of their representatives, and each of our directors or officers who is also an officer,
employee, agent, affiliate or designee of CTO or any of CTO’s affiliates has the right to, and has no duty not to, (x) directly
or indirectly engage in the same or similar business activities or lines of business as us, including those deemed to be competing
with us, or (y) directly or indirectly do business with any of our clients, customers or suppliers. In the event that CTO or any
of its affiliates or employees, or any of their representatives or designees, acquires knowledge of a potential transaction or
matter that may be a corporate opportunity for us, CTO, its affiliates and employees and any of their representatives or designees
shall have no duty to communicate or present such corporate opportunity to us or any of our affiliates and shall not be liable
to us or any of our affiliates, subsidiaries, stockholders or other equity holders for breach of any duty by reason of the fact
that CTO or any of its affiliates or employees, or any of their representatives or designees, directly or indirectly, pursues or
acquires such opportunity for themselves, directs such opportunity to another person, or does not present such opportunity to us
or any of our affiliates; provided, however, that such corporate opportunity is not presented to such person in his or her capacity
as a director or officer of us.


 


Charter
Amendments and Extraordinary Transactions


 


Under
Maryland law, a Maryland corporation generally cannot dissolve, amend its charter, merge, sell all or substantially all of its
assets, convert into another form of entity, engage in a statutory share exchange or engage in similar transactions unless such
transaction is declared advisable by the board of directors and approved by the affirmative vote of stockholders entitled to cast
at least two-thirds of all of the votes entitled to be cast on the matter unless a lesser percentage (but not less than a majority
of the votes entitled to be cast on the matter) is set forth in the corporation’s charter. Our charter provides for approval
of these matters by the affirmative vote of stockholders entitled to cast a majority of the votes entitled to be cast on such matter,
except that the affirmative vote of stockholders holding at least two-thirds of the shares entitled to vote on such matter is required
to amend the provisions of our charter relating to the removal of directors or the vote required to amend the removal provisions.
Maryland law also permits a corporation to transfer all or substantially all of its assets without the approval of its stockholders
to an entity all of the equity interests of which are owned, directly or indirectly, by the corporation. Because our operating
assets may be held by our operating partnership subsidiary or its wholly-owned subsidiaries, these subsidiaries may be able to
merge or transfer all or substantially all of their assets without the approval of our stockholders.


 






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Advance Notice of Director Nominations
and New Business


 


Our
bylaws provide that:


 


	·	with respect to an annual meeting of stockholders, nominations of individuals for election to our
board of directors and the proposal of business to be considered by stockholders at the annual meeting may be made only:


 


	·	pursuant to our notice of the meeting;


 


	· 	by or at the direction of our board of directors; or
	 
	·	by a stockholder who was a stockholder of record at the record date set by the board of directors
for the meeting, at the time of giving of the notice of the meeting and at the time of the annual meeting (and any postponement
or adjustment thereof), who is entitled to vote at the meeting in the election of each individual so nominated or on such other
business and who has complied with the advance notice procedures set forth in, and provided the information and certifications
required by, our bylaws; and


 


	·	with respect to special meetings of stockholders, only the business specified in our company’s
notice of meeting may be brought before the special meeting of stockholders, and nominations of individuals for election to our
board of directors may be made only:


 


	·	by or at the direction of our board of directors; or


 


	·	provided that the special meeting has been called in accordance with our bylaws for the purpose
of electing directors, by any stockholder who is a stockholder of record at the record date set by the board of directors for
the special meeting, at the time of giving of the notice required by our bylaws and at the time of the meeting (and any postponement
or adjustment thereof), who is entitled to vote at the meeting in the election of each individual so nominated and who has complied
with the advance notice provisions set forth in, and provided the information and certifications required by, our bylaws.


 


The
purpose of requiring stockholders to give advance notice of nominations and other proposals is to afford our board of directors
and our stockholders the opportunity to consider the qualifications of the proposed nominees or the advisability of the other proposals
and, to the extent considered necessary by our board of directors, to inform stockholders and make recommendations regarding the
nominations or other proposals. Although our bylaws do not give our board of directors the power to disapprove timely stockholder
nominations and proposals, our bylaws may have the effect of precluding a contest for the election of directors or proposals for
other action if the proper procedures are not followed, and of discouraging or deterring a third party from conducting a solicitation
of proxies to elect its own slate of directors to our board of directors or to approve its own proposal.


 


Anti-takeover Effect of Certain Provisions
of Maryland Law and of Our Charter and Bylaws


 


The
restrictions on ownership and transfer of our stock discussed below, the supermajority vote required to remove directors, our election
to be subject to the provision of Subtitle 8 vesting in our board of directors the exclusive power to fill vacancies on our board
of directors, and the advance notice provisions of our bylaws could delay, defer or prevent a transaction or a change of control
of our company. Likewise, if our board of directors were to elect to be subject to the business combination provisions of the MGCL
(which would also require the affirmative vote of a majority of the votes cast on the matter by stockholders entitled to vote generally
in the election of directors) or if the provision in our bylaws opting out of the control share acquisition provisions of the MGCL
were amended or rescinded, these provisions of the MGCL could have similar anti-takeover effects.


 






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Further,
a majority of our entire board of directors has the power to increase or decrease the aggregate number of authorized shares
of stock or the number of shares of any class or series of stock that we are authorized to issue, to classify and reclassify
any unissued shares of our stock into other classes or series of stock and to authorize us to issue the newly classified
shares, as discussed under the captions “Description of Capital Stock—General” and “Description of
Capital Stock—Description of Common Stock—Power to Classify and Reclassify Unissued Stock,” and could
authorize the issuance of shares of common stock or another class or series of stock, including a class or series of
preferred stock, that could have the effect of delaying, deferring or preventing a change in control of us. These actions may
be taken without stockholder approval unless such approval is required by applicable law, the terms of any other class or
series of our stock or the rules of any stock exchange or automated quotation system on which any of our stock is listed or
traded. We believe that the power of our board of directors to increase or decrease the number of authorized shares of stock
and to classify or reclassify unissued shares of our common stock or preferred stock and thereafter to cause us to issue such
shares of stock will provide us with increased flexibility in structuring possible future financings and acquisitions and in
meeting other needs which might arise.


 


Our
charter and bylaws also provide that the number of directors may be established only by our board of directors, which prevents
our stockholders from increasing the number of our directors and filling any vacancies created by such increase with their own
nominees. The provisions of our bylaws discussed above under the captions “—Meetings of Stockholders” and “—Advance
Notice of Director Nominations and New Business” require stockholders seeking to call a special meeting, nominate an individual
for election as a director or propose other business at an annual or special meeting to comply with certain notice and information
requirements. We believe that these provisions will help to assure the continuity and stability of our business strategies and
policies as determined by our board of directors and promote good corporate governance by providing us with clear procedures for
calling special meetings, information about a stockholder proponent’s interest in us and adequate time to consider stockholder
nominees and other business proposals. However, these provisions, alone or in combination, could make it more difficult for our
stockholders to remove incumbent directors or fill vacancies on our board of directors with their own nominees and could delay,
defer or prevent a change in control, including a proxy contest or tender offer that might involve a premium price for our common
stockholders or otherwise be in the best interest of our stockholders.


 


Exclusive
Forum


 


Our
bylaws provide that, unless we consent in writing to the selection of an alternative forum, the Circuit Court for Baltimore City,
Maryland, or, if that court does not have jurisdiction, the United States District Court for the District of Maryland, Baltimore
Division, will be the sole and exclusive forum for (a) any Internal Corporate Claim, as such term is defined in the MGCL, (b) any
derivative action or proceeding brought on our behalf other than actions arising under the federal securities laws, (c) any action
asserting a claim of breach of any duty owed by any of our directors, officers or other employees to us or to our stockholders,
(d) any action asserting a claim against us or any of our directors, officers or other employees arising pursuant to any provision
of the MGCL or our charter or bylaws or (e) any action asserting a claim against us or any of our directors, officers or other
employees that is governed by the internal affairs doctrine.


 


Limitation
of Liability and Indemnification of Directors and Officers


 


Maryland
law permits a Maryland corporation to include in its charter a provision limiting the liability of its directors and officers to
the corporation and its stockholders for money damages except for liability resulting from actual receipt of an improper benefit
or profit in money, property or services or active and deliberate dishonesty that is established by a final judgment and is material
to the cause of action. Our charter contains such a provision that eliminates such liability to the maximum extent permitted by
Maryland law.


 


The
MGCL requires a Maryland corporation (unless its charter provides otherwise, which our charter does not) to indemnify a director
or officer who has been successful, on the merits or otherwise, in the defense of any proceeding to which he or she is made or
threatened to be made a party by reason of his or her service in that capacity. The MGCL permits a Maryland corporation to indemnify
its present and former directors and officers, among others, against judgments, penalties, fines, settlements and reasonable expenses
actually incurred by them in connection with any proceeding to which they may be made or are threatened to be made a party by reason
of their service in those or other capacities unless it is established that:


 






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		·	the act or omission of the director or officer was material to the matter giving rise to the proceeding
and:



 


		o	was committed in bad faith; or



 


		o	was the result of active and deliberate dishonesty;



 


		·	the director or officer actually received an improper personal benefit in money, property or services;
or



 


		·	in the case of any criminal proceeding, the director or officer had reasonable cause to believe
that the act or omission was unlawful.



 


However,
under the MGCL, a Maryland corporation may not indemnify a director or officer for an adverse judgment in a suit by or on behalf
of the corporation or if the director or officer was adjudged liable on the basis that personal benefit was improperly received,
unless, in either case, a court orders indemnification and then only for expenses. A court may order indemnification if it determines
that the director or officer is fairly and reasonably entitled to indemnification, even though the director or officer did not
meet the prescribed standard of conduct or was adjudged liable on the basis that personal benefit was improperly received.


 


In
addition, the MGCL permits a Maryland corporation to advance reasonable expenses to a director or officer upon the corporation’s
receipt of:


 


		·	a written affirmation by the director or officer of his or her good faith belief that he or she
has met the standard of conduct necessary for indemnification by the corporation; and



 


		·	a written undertaking, which may be unsecured, by the director or officer or on the director’s
or officer’s behalf to repay the amount paid if it shall ultimately be determined that the standard of conduct has not been
met.



 


Our
charter obligates us, to the maximum extent permitted by Maryland law in effect from time to time, to indemnify and to pay or reimburse
reasonable expenses in advance of final disposition of a proceeding without requiring a preliminary determination of the director’s
or officer’s ultimate entitlement to indemnification to:


 


		·	any present or former director or officer who is made or threatened to be made a party to or witness
in the proceeding by reason of his or her service in that capacity; or



 


		·	any individual who, while a director or officer of our company and at our request, serves or has
served as a director, officer, partner, member, manager, trustee, employee or agent of another corporation, real estate investment
trust, partnership, limited liability company, joint venture, trust, employee benefit plan or any other enterprise and who is made
or threatened to be made a party to or witness in the proceeding by reason of his or her service in that capacity.



 


Our
charter also permits us, with the approval of our board of directors, to indemnify and advance expenses to any person who served
a predecessor of ours in any of the capacities described above and to any employee or agent of our company or a predecessor of
our company.


 


Indemnification
Agreements


 


We
have entered into indemnification agreements with each of our directors and executive officers that obligate us to indemnify
them to the maximum extent permitted by Maryland law as discussed above under “Certain Provisions of Maryland Law and
of Our Charter and Bylaws— Limitation of Liability and Indemnification of Directors and Officers.” The
indemnification agreements provide that, if a director or executive officer is a party to, or witness in, or is threatened to
be made a party to, or witness in, any proceeding by reason of his or her service as a director, officer, employee or agent
of our company or as a director, officer, partner, member, manager, fiduciary, employee, agent or trustee of any other
foreign or domestic corporation, real estate investment trust, partnership, limited liability company, joint venture, trust,
employee benefit plan or other enterprise that he or she is or was serving in such capacity at our request, or the request of
our external manager, we must indemnify the director or executive officer for all expenses and liabilities actually and
reasonably incurred by him or her, or on his or her behalf, to the maximum extent permitted under Maryland law, including in
any proceeding brought by the director or executive officer to enforce his or her rights under the indemnification agreement,
to the extent provided by the agreement. The indemnification agreements also require us to advance reasonable expenses
incurred by the indemnitee within ten days of the receipt by us of a statement from the indemnitee requesting the advance,
provided the statement evidences the expenses and is accompanied or preceded by:


 






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		·	a written affirmation of the indemnitee’s good faith belief that he or she has met the standard
of conduct necessary for indemnification; and



 


		·	a written undertaking, which may be unsecured, by the indemnitee or on his or her behalf to repay
the amount paid if it shall ultimately be established that the standard of conduct has not been met.



 


The
indemnification agreements also provide for procedures for the determination of entitlement to indemnification, including requiring
such determination be made by independent counsel after a change of control of us.


 


REIT Qualification


 


Our
charter provides that our board of directors may revoke or otherwise terminate our election to be taxed as a real estate investment
trust (“REIT”) for U.S. federal income tax purposes, without approval of our stockholders, if it determines that it
is no longer in our best interest to continue to qualify as a REIT.


 


Restrictions
on Ownership and Transfer


 


For
us to qualify and maintain our qualification as a REIT for each taxable year commencing with our taxable year ending December 31,
2020, our shares of stock must be beneficially owned by 100 or more persons during at least 335 days of a taxable year of 12 months
or during a proportionate part of a shorter taxable year. Also, not more than 50% of the value of our outstanding shares of stock
may be owned, directly or indirectly, by five or fewer individuals (as defined in the Internal Revenue Code of 1986, as amended
(the “Code”), to include certain entities) during the last half of a taxable year commencing with our taxable year
ending December 31, 2020.


 


Because
our board of directors believes it is at present essential for us to qualify as a REIT, our charter, subject to certain exceptions,
restricts the amount of our shares of stock that a person may beneficially or constructively own. Our charter provides that, subject
to certain exceptions, no person may beneficially or constructively own more than 9.8% in value or in number of shares, whichever
is more restrictive, of the outstanding shares of any class or series of our capital stock.


 


Our
charter also prohibits any person from (i) beneficially owning shares of our capital stock to the extent that such beneficial ownership
would result in our being “closely held” within the meaning of Section 856(h) of the Code (without regard to whether
the ownership interest is held during the last half of the taxable year), (ii) transferring shares of our capital stock to the
extent that such transfer would result in shares of our capital stock being beneficially owned by less than 100 persons (determined
under the principles of Section 856(a)(5) of the Code), (iii) beneficially or constructively owning shares of our capital stock
to the extent such beneficial or constructive ownership would cause us to constructively own 10% or more of the ownership interests
in a tenant (other than a taxable REIT subsidiary (as defined in Section 856(l) of the Code)) of our real property within the meaning
of Section 856(d)(2)(B) of the Code or (iv) beneficially or constructively owning or transferring shares of our capital stock if
such ownership or transfer would otherwise cause us to fail to qualify as a REIT. Any person who acquires or attempts or intends
to acquire beneficial or constructive ownership of shares of our capital stock that will or may violate any of the foregoing restrictions
on transferability and ownership, or any person who would have owned shares of our capital stock that resulted in a transfer of
shares of our capital stock to a charitable trust, is required to give written notice immediately to us, or in the case of a proposed
or attempted transaction, to give at least 15 days’ prior written notice, and provide us with such other information as we
may request in order to determine the effect of such transfer on our qualification as a REIT. The foregoing restrictions on transferability
and ownership will not apply if our board of directors determines that it is no longer in our best interests to attempt to qualify,
or to continue to qualify, as a REIT.


 






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Our
board of directors, in its sole discretion, may prospectively or retroactively exempt a person from the limits described above
and may establish or increase an excepted holder percentage limit for such person. The person seeking an exemption must provide
to our board of directors such representations, covenants and undertakings as our board of directors may deem appropriate in order
to conclude that granting the exemption will not cause us to fail to qualify as a REIT. Our board of directors may not grant such
an exemption to any person if such exemption would result in our failing to qualify as a REIT. Our board of directors may require
a ruling from the Internal Revenue Service or an opinion of counsel, in either case in form and substance satisfactory to the board
of directors, in its sole discretion, in order to determine or ensure our status as a REIT.


 


Any
attempted transfer of shares of our capital stock which, if effective, would violate any of the restrictions described above will
result in the number of shares causing the violation (rounded up to the nearest whole share) to be automatically transferred to
a trust for the exclusive benefit of one or more charitable beneficiaries, except that any transfer that results in the violation
of the restriction relating to shares of our capital stock being beneficially owned by fewer than 100 persons will be void ab
initio. In either case, the proposed transferee will not acquire any rights in such shares. The automatic transfer will be
deemed to be effective as of the close of business on the business day prior to the date of the purported transfer or other event
that results in the transfer to the trust. Shares held in the trust will be issued and outstanding shares. The proposed transferee
will not benefit economically from ownership of any shares held in the trust, will have no rights to dividends or other distributions
and will have no rights to vote or other rights attributable to the shares held in the trust. The trustee of the trust will have
all voting rights and rights to dividends or other distributions with respect to shares held in the trust. These rights will be
exercised for the exclusive benefit of the charitable beneficiary. Any dividend or other distribution paid prior to our discovery
that shares have been transferred to the trust will be paid by the recipient to the trustee upon demand. Any distribution authorized
but unpaid will be paid when due to the trustee. Any dividend or other distribution paid to the trustee will be held in trust for
the charitable beneficiary. Subject to Maryland law, the trustee will have the authority (i) to rescind as void any vote cast by
the proposed transferee prior to our discovery that the shares have been transferred to the trust and (ii) to recast the vote in
accordance with the desires of the trustee acting for the benefit of the charitable beneficiary. However, if we have already taken
irreversible corporate action, then the trustee will not have the authority to rescind and recast the vote.


 


Within
20 days of receiving notice from us that shares of our capital stock have been transferred to the trust, the trustee will sell
the shares to a person designated by the trustee, whose ownership of the shares will not violate the above ownership and transfer
limitations. Upon the sale, the interest of the charitable beneficiary in the shares sold will terminate and the trustee will distribute
the net proceeds of the sale to the proposed transferee and to the charitable beneficiary as follows. The proposed transferee will
receive the lesser of (i) the price paid by the proposed transferee for the shares or, if the proposed transferee did not give
value for the shares in connection with the event causing the shares to be held in the trust (e.g., a gift, devise or other similar
transaction), the market price (as defined in our charter) of the shares on the day of the event causing the shares to be held
in the trust and (ii) the price received by the trustee (net of any commission and other expenses of sale) from the sale or other
disposition of the shares. The trustee may reduce the amount payable to the proposed transferee by the amount of dividends or other
distributions paid to the proposed transferee and owed by the proposed transferee to the trustee. Any net sale proceeds in excess
of the amount payable to the proposed transferee will be paid immediately to the charitable beneficiary. If, prior to our discovery
that shares of our capital stock have been transferred to the trust, the shares are sold by the proposed transferee, then (i) the
shares shall be deemed to have been sold on behalf of the trust and (ii) to the extent that the proposed transferee received an
amount for the shares that exceeds the amount he or she was entitled to receive, the excess shall be paid to the trustee upon demand.


 


In
addition, shares of our capital stock held in the trust will be deemed to have been offered for sale to us, or our designee, at
a price per share equal to the lesser of (i) the price per share in the transaction that resulted in the transfer to the trust
(or, in the case of a devise or gift, the market price at the time of the devise or gift) and (ii) the market price on the date
we, or our designee, accept the offer, which we may reduce by the amount of dividends and distributions paid to the proposed transferee
and owed by the proposed transferee to the trustee. We will have the right to accept the offer until the trustee has sold the shares.
Upon a sale to us, the interest of the charitable beneficiary in the shares sold will terminate and the trustee will distribute
the net proceeds of the sale to the proposed transferee.


 






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If
a transfer to a charitable trust, as described above, would be ineffective for any reason to prevent a violation of a restriction,
the transfer that would have resulted in such violation will be void ab initio, and the proposed transferee shall acquire
no rights in such shares.


 


Every
owner of more than 5% (or such lower percentage as required by the Code or the regulations promulgated thereunder) of shares of
our capital stock, within 30 days after the end of each taxable year, is required to give us written notice, stating his or her
name and address, the number of shares of each class and/or series of our stock that he or she beneficially owns and a description
of the manner in which the shares are held. Each such owner must provide us with such additional information as we may request
in order to determine the effect, if any, of his or her beneficial ownership on our status as a REIT and to ensure compliance with
the ownership limits. In addition, each stockholder will upon demand be required to provide us with such information as we may
request in order to determine our status as a REIT and to comply with the requirements of any taxing authority or governmental
authority or to determine such compliance and to ensure compliance with the ownership limit.


 


These
ownership limitations could delay, defer or prevent a transaction or a change in control that might involve a premium price for
our common stock or otherwise be in the best interest of our stockholders.




 






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