Document:

Document

Exhibit 10.1

SETTLEMENT AGREEMENT   

This SETTLEMENT AGREEMENT (this “Settlement Agreement”), dated February 17,  2021 (the “Effective Date”), is by and between Putnam Focused Equity Fund, a series of Putnam  Funds Trust (“Putnam”), as successor in interest to each of Putnam Equity Spectrum Fund and  Putnam Capital Spectrum Fund, each a series of Putnam Funds Trust (the “Predecessor Funds”)  and Altisource Asset Management Corporation (“AAMC”).  Putnam and AAMC may be referred  to hereinafter jointly as the “Parties” or individually as a “Party.”   
 
WHEREAS, in March 2014, the Predecessor Funds acquired eighty-one thousand, eight  hundred (81,800) shares of AAMC Series A Convertible Preferred Stock, par value $0.01 (the  “Preferred  Shares”)  pursuant  to  a  Securities  Purchase  Agreement  dated  March  13,  2014  (the  “SPA”), which attached a Certificate of Designations, dated March 17, 2014 (as the same has been  or may be amended from time to time in accordance with its terms, the “Certificate”);   

WHEREAS, on or about February 3, 2020, Putnam sent a redemption notice to AAMC  with respect to all Preferred Shares held by Putnam;  

WHEREAS, pursuant to an Agreement and Plan of Reorganization, dated as of August 5,  2020,  effective  as  of  August  24,  2020  the  Preferred  Shares  held  by  the  Predecessor  Funds,  including all rights and obligations in connection therewith, were transferred to Putnam;  

WHEREAS, the Predecessor Funds and  Luxor Capital Group LP, Luxor Capital Partners  Offshore Masters Fund, LP, Luxor Capital Partners, LP, Luxor Wavefront, LP, Luxor Spectrum,  LLC, and Thebes Offshore Master Fund, LP (collectively, “Luxor”, and with the Predecessor  Funds, “Plaintiffs”) filed an action against AAMC in the Supreme Court of the State of New York  in the County of New York (the “New York Supreme Court”) titled Luxor Capital Group LP,  Luxor Capital Partners Offshore Master Fund, LP, Luxor Capital Partners, LP, Luxor Wavefront,  LP, Luxor Spectrum, LLC, Thebes Offshore Master Fund, LP, Putnam Equity Spectrum Fund, and  Putnam  Capital  Spectrum  Fund  v.  Altisource  Asset  Management  Corporation  (Index  No.  650746/2020) (the “Litigation”) seeking in part to compel AAMC to redeem the Predecessor  Funds’ Preferred Shares;  

WHEREAS, Putnam and AAMC now desire to settle amicably all claims arising from or  relating to the Litigation and the Preferred Shares on the terms provided herein;   

NOW, THEREFORE, in consideration of the promises and mutual covenants set forth   herein, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:   

1.Settlement Consideration.

A.        As  consideration  for  settlement  of  the  Litigation,  AAMC  shall  pay  to  Putnam (i) One Million Six Hundred Thirty-Six Thousand and No/100 Dollars ($1,636,000.00)  (the “Initial Payment”) within three (3) business days after the Effective Date (the “Closing Date”),  and (ii) One Million Two Hundred Twenty-Seven Thousand and No/100 Dollars ($1,227,000.00)  on the twelve (12) month anniversary of the Effective Date (the “Second Payment”), in each case   

by federal wire transfer of immediately available funds to the account specified on Exhibit A hereto  or as may be further directed by Putnam hereafter to AAMC in writing.  

B.        In satisfaction of any and all obligations under the Certificate, on the terms  and subject to the conditions set forth herein, Putnam shall transfer, convey and assign all of  Putnam’s right, title and interest in and to all of the Preferred Shares owned beneficially and of  record by Putnam, free and clear of any liens or encumbrances, to AAMC on the Closing Date,  against receipt of and in exchange for an aggregate of two hundred and eighty eight thousand, two  hundred and eighty three (288,283) fully paid and non-assessable shares of common stock, par  value $0.01 per share, of AAMC (the “Common Shares”) to be issued by AAMC to Putnam (such  delivery by Putnam and issuance by AAMC, the “Exchange”). AAMC shall cause to be delivered  written notice from its transfer agent evidencing the issuance to Putnam of the Common Shares on  and as of the Closing Date. 
 
C.        The Parties acknowledge that the Common Shares issued in the Exchange  have not been, and will not be, registered under the Securities Act of 1933, as amended (the  “Securities Act”), and may not be offered, sold, assigned, pledged or otherwise transferred without  registration  under  the  Securities  Act  or  pursuant  to  an  exemption  from  the  registration  requirements of the Securities Act. Provided Putnam is not, and has not been in the past three  months, an “affiliate” (as defined by Rule 405 of the Securities Act) of the Company and the other  conditions  to  Rule  144  under  the  Securities  Act  have  been  satisfied,  the  Parties  further  acknowledge that, as of the Effective Date, the Common Shares are immediately eligible for offer,  resale,  transfer,  pledge  or  disposition  pursuant  to  the  provisions  for  non-affiliates  of  Rule  144(b)(1)(i) promulgated under the Securities  Act.  As such, the  certificates  representing the  Common Shares (or book entries with AAMC’s transfer agent in the event one or more certificates  shall not be issued with respect to the Common Shares) shall not contain any restrictive legend.   Subject to receipt from Putnam of a customary Rule 144 representation letter as to non-affiliate  status, AAMC agrees to deliver the Common Shares, free of any restrictive legend, via DTC to the  custodian bank and DTC participant set forth on Exhibit A hereto.    

D.        Putnam agrees that, upon the consummation of the Exchange, the SPA shall  be  void  and  of  no  further  force  and  effect,  and  that  its  rights  under  the  Certificate  shall  be  extinguished with respect to the eighty-one thousand, eight hundred (81,800) Preferred Shares  owned beneficially and of record by Putnam.   

E.         The Parties hereby acknowledge and agree that the provisions of Section  7(a) of the Certificate and Section 6.4(a) of the SPA are inapplicable to, and do not prohibit or  restrict, the Exchange.   

2. Mutual Releases.

A.        Putnam,  for  itself,  its  predecessors,  successors,  Affiliates,  parents,  subsidiaries, and assigns (“Putnam Releasors”), hereby waives, releases and forever discharges  AAMC and its Affiliates and each of their respective  past, present, and future officers, directors,  partners,  members,  shareholders,  employees,  lawyers,  agents,  and  servants  from  any  and  all  claims, obligations, demands, actions, causes of action and liabilities, of whatsoever kind and  nature, character and description, whether in law or equity, whether sounding in tort, contract or  
                  
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under Applicable Law, as defined in Section 6 below, whether known or unknown, and whether  anticipated or unanticipated, which Putnam Releasors ever had, now have or may ever have,  arising from any event, transaction, matter, circumstance or fact in any way arising out of, arising  as a result of, related to, with respect to or in connection with or based in whole or in part on the  SPA, the Certificate, the Preferred  Shares, and any facts or allegations alleged in or that could  have been  alleged in the Litigation (the “Putnam Released Claims”); provided, however that  Putnam does not hereby waive, release or discharge AAMC from any of its obligations under this  Settlement Agreement.   

B.        AAMC,  for  itself,  its  predecessors,  successors,  Affiliates,  parents,  subsidiaries and assigns (“AAMC Releasors”), hereby waives, releases and forever discharges  Putnam and its Affiliates and each of their respective past, present and future officers, directors,  partners,  members,  shareholders,  employees,  lawyers,  agents,  and  servants  from  any  and  all  claims, obligations, demands, actions, causes of action and liabilities, of whatsoever kind and  nature, character and description, whether in law or equity, whether sounding in tort, contract or  under other Applicable Law, as defined in Section 6 below, whether known or unknown, and  whether anticipated or unanticipated, which AAMC Releasors ever had, now have or may ever  have, arising from any event, transaction, matter, circumstance or fact in any way arising out of,  arising as a result of, related to, with respect to or in connection with or based in whole or in part  on the SPA, the Certificate, the Preferred Shares, and any facts or allegations alleged in or that  could have been alleged in the Litigation (the “AAMC Released Claims”, and together with the  Putnam Released Claims, the “Released Claims”); provided, however, that AAMC does not hereby  waive, release or discharge Putnam from any of its obligations under this Settlement Agreement.     

C.        With  respect  to  any  and  all  claims  released  pursuant  to  the  foregoing  paragraphs, each of the Parties expressly waives the provisions, rights and benefits of California  Civil Code § 1542 and any provisions, rights, and benefits conferred by any law of any state or  territory  of  the  United  States  or  principle  of  common  law  which  is  similar,  comparable  or  equivalent to California Civil Code § 1542, which provides: 
  
A general release does not extend to claims which the creditor does not know or  suspect to exist in his or her favor at the time of executing the release, which if  known by him or her must have materially affected his or her settlement with the  debtor.   

D.        The consequences of the foregoing waiver provisions have been explained  by each of the Parties’ respective counsel.  Each of the Parties acknowledge that it may hereafter  discover facts different from, or in addition to, those it now knows or believes to be true with  respect  to  the  Released  Claims,  and  agrees  that  this  Settlement  Agreement  and  the  releases  contained herein shall be and remain effective in all respects not withstanding such different or  additional facts or the discovery thereof.   
 
E.         To  the  extent  the  Applicable  Law  would  not  otherwise  recognize  the  provisions of subsections (A) and (B) of Section 2 as constituting a full and final release applying  to all unknown and unanticipated Released Claims, as well as those now known or disclosed, the  

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Parties hereby expressly waive all rights or benefits which each of them may have now or in the  future under any such Applicable Law.  

F.         The Parties hereby acknowledge and agree that the provisions of Section 2  above shall be solely applicable to the Released Claims, and shall not apply, and shall not be  deemed to apply to any third party, including without limitation any holder of Preferred Shares or  any signatory to the SPA other than Putnam.  

3. Discontinuance of the Litigation. Simultaneously  with  the  execution  of  this  Settlement Agreement, the parties will execute a stipulation of dismissal of the Litigation with  prejudice in the form attached hereto as Exhibit B.  The executed stipulation of dismissal will be  filed by Kaplan Rice LLP within three (3) business days of the Effective Date.  To the extent that  a joint motion for discontinuance of the Litigation is required, Kaplan Rice will prepare such  motion and file it as soon as practicable. Putnam agrees to cooperate and take all steps necessary  to cause the Litigation to be dismissed in accordance with this paragraph.    

4. Most Favored Nation Clause.  Subject to Putnam’s compliance with Section 5,  AAMC agrees that, until the Termination Date (as defined in Section 5(B)), if AAMC enters into  a  mutually  agreed  settlement  with  any  other  holder  of  Preferred  Shares  which  results  in  the  exchange,  cancellation,  or  redemption  of  Preferred  Shares  for  value  in  excess  of  the  value   provided  to  Putnam  under  this  Settlement  Agreement,  then  AAMC  will  make  an  additional  payment  to  Putnam  (“Additional  Payment”).  The  Additional  Payment  will  be  equal  to  the  difference between the value on a per Preferred Share basis Putnam receives under this Settlement  Agreement (as of the date of this Settlement Agreement) and the value of the consideration  on a  per Preferred Share basis the other settling party receives.   The Additional Payment shall be paid  in common stock of AAMC and/or cash, in the same proportion thereof as paid to the other settling  party, and is conditioned on Putnam’s compliance with the Voting Agreement in Section 5 through  the time of such settlement.  For the avoidance of doubt, AAMC shall have no obligations to make  any Additional Payment pursuant to this Section 4 solely as a result of the payment of a different  ratio of cash to common stock of AAMC to such other settling party as compared to the amounts  set  forth  in  Section  1  of  this  Settlement  Agreement.    AAMC  will  notify  Putnam  of  any  settlement(s)  with  other  holders  of  preferred  shares,  and  shall  disclose  to  Putnam  (which  information  Putnam  shall  keep  subject  to  the  terms  of  Section  8)  the  financial  terms  of  the  settlement(s)  and  any  terms  that  affect  the  value  of  the  settlement,  including  a  reasonable  description of the calculation of the value of such settlement and a reconciliation to the value  received by Putnam hereunder.  Any such common stock issued to Putnam under this Section 4  shall be fully paid and non-assessable, and deemed to be additional shares issued as a result of the  Exchange pursuant to Section 1 of this Agreement and shall, for the avoidance of doubt, be subject  to AAMC’s obligations pursuant to Section 1(C) of this Agreement, provided that Putnam has  delivered a customary representation letter as to non-affiliate status.   

5. Voting Agreement.

A.        Putnam  agrees  that,  until  the  Termination  Date,  (a)  at  each  and  every  meeting of the stockholders of AAMC and at every postponement or adjournment thereof, Putnam  shall take such action as may be required so that all of the shares of common stock of AAMC  beneficially owned, directly or indirectly, by Putnam and entitled to vote at such meetings of  
                                                             
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stockholders are voted (i) in favor of each director nominated and recommended by the Board of  Directors of AAMC (the “Board”) (or a duly authorized committee thereof) for election at any  such meeting, (ii) against any stockholder nominations for directors which are not approved and  recommended by the Board (or a duly authorized committee thereof) for election at any such  meeting and (iii) otherwise in accordance with the Board’s recommendation on all proposals  properly brought before any meetings of stockholders of AAMC, including any proposal seeking  approval to amend AAMC’s charter to increase the total number of authorized shares of capital  stock of any class or series (except as permitted in the following proviso), and (b) Putnam shall  not, directly or indirectly, solicit any proxies or seek to advise or influence any Person with respect  to the voting of AAMC’s securities in connection with any of the matters set forth in this Section  5;  provided  that  Putnam  shall  not  be  under  any  obligation  to  vote  in  the  same  manner  as  recommended by the Board or in any other manner, other than in Putnam’s sole discretion, with  respect to any matter, including the approval (or non-approval) or adoption (or non-adoption) of  any  proposal, related to, (i) any merger or other business combination transaction involving  AAMC, (ii) the sale of all or substantially all of the assets of AAMC, (iii) any other change of  control transaction involving AAMC, or (iv) financings, recapitalizations, and securities offerings  that require approval from the holders of AAMC common stock pursuant to rules of the NYSE  American or any other national securities exchange on which AAMC’s common stock is then  listed, or distributions or dividends that are not made on a pro rata basis to the holders of AAMC  common stock, but Putnam shall not, directly or indirectly, initiate, propose, or be part of a group  or act in concert with any other Person that proposes, nor shall it make any public statements with  respect to, any such transaction unless consistent with the Board’s recommendation, and Putnam  shall not, directly or indirectly, solicit any proxies or seek to advise or influence any Person with  respect to the any such transaction.    

B.        Both  the  Most  Favored  Nation  Clause  (Section  4)  and  the  Voting  Agreement (Section 5(A)) shall terminate automatically on March 1, 2025.  After the date upon  which AAMC holds its 2022 annual meeting of shareholders, both the Most Favored Nation Clause  (Section 4) and the Voting Agreement (Section 5(A)) shall terminate before March 1, 2025: (i) if  Putnam, in its sole discretion, elects to terminate the Voting Agreement in Section 5(A) by written  notice  to  AAMC,  in  which  case  the  Most  Favored  Nation  Clause  (Section  4)  automatically  terminates  on  that  date  as  well  or  (ii)    if  AAMC  has  prior  to  the  2022  annual  meeting  of  shareholders  settled  all  claims  of  holders  of  the  Preferred  shares,  resulting  in  the  exchange,  cancellation or redemption of all of the outstanding Preferred Shares, in which case both the Most  Favored Nation Clause (Section 4) and the Voting Agreement (Section 5(A) shall automatically  terminate on the business day immediately following the 2022 annual meeting of shareholders.   The date on which Section 4 and Section 5(A) terminates is the “Termination Date”.  

C.        Putnam agrees that until the Termination Date, for so long as Putnam owns,  directly or indirectly, any shares of common stock of AAMC, Putnam shall (to the extent necessary  to comply with this Section 5) be present, in person or by proxy, at all meetings of the stockholders  of AAMC so that all common shares of AAMC owned by Putnam, directly or indirectly, may be  counted for the purposes of determining the presence of a quorum and voted in accordance with  this Section 5 at such meetings (including at any adjournments or postponements thereof).  

D.          To  the  extent  that  Putnam  does  not  perform  in  accordance  with  and/or   breaches the provisions of this Section 5, Putnam hereby irrevocably and to the fullest extent  
                                                                     
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permitted by law appoint AAMC with full power of substitution and resubstitution, as Putnam’s  true and lawful attorney and irrevocable proxy, to the fullest extent of Putnam’s rights with respect  to the common shares of AAMC owned beneficially or of record by Putnam, to vote each of such  common shares, or to execute a written consent, solely with respect to the matters set forth in  Section 5  hereof.    Putnam  intends  this  proxy  to  be  irrevocable  and  coupled  with  an  interest  hereunder until the Termination Date and hereby revokes any proxy previously granted by Putnam  with respect to any and all shares of common stock of AAMC owned beneficially or of record by  Putnam.    

6. Definitions. For purposes of this Settlement Agreement, the following terms shall  have the following meanings:  

A.        “Affiliate”  shall  mean  a  Person  directly  or  indirectly  controlled  by,  controlling, under common control with, or managed by the other Person.  For the purposes of this  definition, “control” means, when used with respect to any Person, 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 securities, by contract or otherwise.  

B.        “Applicable Law” shall mean any statute, law, rule or regulation or any  judgment, order, consent order, stipulated agreement, ordinance, writ, injunction or decree of any  Governmental Entity.  

C.        “Governmental Entity” shall mean any domestic or foreign court or tribunal  in any domestic or foreign jurisdiction or any federal, state, municipal or local government or other  governmental body, agency, authority, district, department, commission, board, bureau, or other  instrumentality, arbitrator or arbitral body (domestic or foreign), including any joint action agency,  public power authority, public utility district, or other similar political subdivision.  

D.        “Person” shall mean any individual, corporation, partnership, joint venture,  trust,  limited  liability  company,  unincorporated  organization,  investment  fund,  account,  Governmental Entity or other entity.  

7. Representations and Warranties.   

A.    Each Party represents and warrants that it has read fully and understands the  provisions set forth in this Settlement Agreement;  

B.    Each Party represents and warrants that it has discussed, or has had the  opportunity to discuss to its satisfaction, the provisions of this Settlement Agreement with its  attorneys and other professional advisors;   

C.    Each  Party  represents  and  warrants  that  no  Party  is  relying  upon  any  representations, agreements or understandings, expressed or implied, written or oral, except those  representations, agreements and understandings explicitly set forth in this Settlement Agreement;   

D.    Each  Party  represents  and  warrants  that  the  individuals  executing  this   Settlement Agreement on behalf of Putnam and AAMC have full power and authority to execute  
                                                                      
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and deliver this Settlement Agreement on behalf of those Parties, and, once executed and delivered,  this Settlement Agreement shall constitute the valid and binding obligation of those Parties and be  enforceable against those Parties pursuant to the terms set forth in this Settlement Agreement;  

E.    Each Party represents and warrants that the execution and delivery of this  Settlement Agreement and the performance of or compliance with the terms and provisions of this  Settlement Agreement will not violate, conflict with, or result in a breach of any of the terms,  conditions or provisions of any law, statute, regulation or order, or any agreement or any other  restrictions of any kind or character, to which the Party may be bound; and   

F.    Putnam represents and warrants that (i) it is the successor in interest to the  Predecessor Funds, (ii) it has assumed all rights and obligations of the Predecessor Funds under  the SPA and the Certificate, (iii) the Predecessor Funds no longer have any rights under the SPA  or the Certificate, and (iv) it is the sole beneficial owner of, has sole right, title in and interest to,  and it has not sold, transferred, encumbered or otherwise assigned any Preferred Shares or any  claim, demand, chose in action or other matter in whole or in part that is the subject of this  settlement and/or may be compromised, settled, and/or released pursuant to the terms of this  Settlement Agreement, including without limitation by contract or by operation of law (including  by way of subrogation) to any other person or entity.  

G.    Putnam hereby acknowledges that AAMC may have material nonpublic  information regarding AAMC and its subsidiaries and that Putnam has requested that AAMC not  provide Putnam with any such material non-public information.  Putnam acknowledges that any  and all claims that Putnam may have as of the Effective Date in connection with the non-disclosure  of any such material nonpublic information shall be a Putnam Released Claim for all purposes of  Section 2.     

H.    AAMC represents that the Common Shares have been duly authorized and,  when issued and delivered to Putnam in the Exchange, the Common Shares will be validly issued,  fully paid and non-assessable.  

I.    AAMC represents that no registration under the Securities Act or listing  rules of the NYSE American is required for the issuance of the Common Shares in the Exchange.  AAMC is not required to obtain any consent, waiver, authorization or order of, give any notice to,  or make any filing or registration with, any court or other federal, state, local or other governmental  authority, self-regulatory organization or other person in connection with the execution, delivery  and  performance  by  AAMC  of  this  Settlement Agreement  (including,  without  limitation,  the  issuance of the Common Shares).  

J.    As of their respective dates, all reports required to be filed by AAMC with  the U.S. Securities and Exchange Commission (the “SEC”) during the 12 months preceding the  Effective  Date    (the  “SEC  Reports”)  complied  in  all  material  respects  with  the  applicable  requirements of the Securities Act of 1933, as amended, (the “Securities Act”) and/or the Securities  Exchange Act of 1934, as amended, (the “Exchange Act”) and the rules and regulations of the SEC  promulgated thereunder, and none of the SEC Reports, when filed, contained any untrue statement  of a material fact or omitted to state a material fact required to be stated therein or necessary in  

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order to make the statements therein, in the light of the circumstances under which they were made, not misleading.  

K.    Putnam acknowledges and agrees that the Common Shares have not been   registered under the Securities Act and that AAMC is not required to register the Common Shares.    Putnam acknowledges and agrees that the Common Shares may not be offered, resold, transferred,   pledged or otherwise disposed of by Putnam absent an effective registration statement under the   Securities  Act  except  (i)  to  AAMC  or  a  subsidiary  thereof  or  (ii)  pursuant  to  an  applicable   exemption from the registration requirements of the Securities Act, and, in accordance with any   applicable securities laws of the states of the United States and other applicable jurisdictions.      Putnam is not now, and has not been during the preceding three months, an “affiliate” of the   Company (as that term is defined in Rule 405 under the Securities Act). The Parties acknowledge   that, as of the Effective Date, the Common Shares are immediately eligible for offer, resale,   transfer, pledge or disposition pursuant to the provisions for non-affiliates of Rule 144(b)(1)(i)   promulgated under the Securities Act.    

L.    Putnam acknowledges that there have been no representations, warranties,   covenants and agreements made to Putnam by or on behalf of AAMC, any of their respective   affiliates or any control persons, officers, directors, employees, agents or representatives of any   of the foregoing or any other person or entity, expressly or by implication, other than those   representations, warranties, covenants and agreements of AAMC expressly set forth in Section 7   of this Settlement Agreement.  Putnam further acknowledges that it has reviewed AAMC’s filings   with the Securities and Exchange Commission (the “SEC”) and has received such information as   Putnam deems necessary in connection with its decision to enter into this Settlement Agreement,   including, with respect to AAMC, the Exchange and the business of AAMC and its subsidiaries.  

M.    Putnam acknowledges that it is aware that there are substantial risks incident   to the ownership of the Common Shares, including those set forth in AAMC’s filings with the   SEC. Putnam has such knowledge and experience in financial and business matters as to be capable   of evaluating the merits and risks of an investment in the Common Shares, and Putnam has sought   such accounting, legal and tax advice as Putnam has considered necessary to make an informed   investment decision. Putnam acknowledges that it shall be responsible for any of Putnam’s tax   liabilities that may arise as a result of the transactions contemplated by this Settlement Agreement,   and that none of AAMC, its Affiliates and representatives has provided any tax advice or any other   representation or guarantee regarding the tax consequences of the transactions contemplated by   the Settlement Agreement.  

8. Confidentiality.

A.    This Settlement Agreement is confidential, and no Party or its respective  Affiliates,  directors,  officers,  managers,  employees,  investment  advisors,  agents,  financial  advisors, representatives, accountants or attorneys will disclose to any person or entity that is a  non-Party, or disseminate by publication of any sort, the discussions and negotiations between the  Parties relating to this Settlement Agreement or the terms of this Settlement Agreement, including  without limitation, the amount, terms and conditions of any sums payable hereunder (collectively,  “Confidential  Information”),  except  (i)  as  required  or  requested  by  law,  regulation  or  rule,  including for the avoidance of doubt, but not limited to, any obligations that Putnam or AAMC  
                                                      
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may have under the Securities Act, the Exchange Act or the Investment Company Act of 1940, as  amended; (ii) to the Parties’ directors, officers, trustees, managers, attorneys, accountants, tax  advisors and other professional advisors, as long as such persons are required by the nature of their  relationship with the disclosing Party to maintain the confidentiality of the terms of this Settlement  Agreement; (iii) as required or requested by any regulatory organization with authority over the  disclosing Party; or (iv) in response to a lawful subpoena or order of any court of competent  jurisdiction.    Notwithstanding  anything  to  the  contrary  contained  in  this  Section  8,  Putnam  acknowledges that AAMC is subject to the periodic reporting requirements of the Exchange Act  and  that  AAMC  may,  in  its  sole  discretion,  summarize  any  or  all  terms  of  this  Settlement  Agreement or file a copy of this Settlement Agreement with the SEC as part of such reporting  requirements. Upon or following any such disclosure by AAMC, any such information disclosed  in  connection  with  such  reporting  requirement  shall  no  longer  be  deemed  Confidential  Information.    

B.    If a Party reasonably believes itself to be compelled by law, or a lawful  subpoena  or  court  order  to  disclose  Confidential  Information,  unless  prohibited  by  law  or  regulation and except as provided in the preceding paragraph, that Party will promptly notify the  other Party in writing prior to making any such disclosure to provide such other Party a reasonable  opportunity to either waive any objection to such disclosure or request a remedy, at its sole cost  and  expense,  from  the  appropriate  authority.    The  Party  subject  to  the  disclosure  will  use  reasonable efforts to cooperate with the other Party in their reasonable efforts to obtain a remedy,  but all work to obtain a remedy shall be done by the Party seeking the remedy and the other Party  shall have no obligation to perform such work, including preparing court papers.  If the Party who  was not compelled to disclose Confidential Information waives its objections, is unsuccessful in  its request or does not obtain relief from disclosure in the time period in which the Party subject  to such disclosure is obligated to respond to such disclosure request, the other Party will disclose  only information that is required to be disclosed by the relevant law, requirement of a regulatory  organization or lawful subpoena or court order. Notwithstanding the foregoing, no notice shall be  required if the Party subject to the disclosure request becomes subject to a broad request for  information by a regulatory or administrative authority that is not specific to the Confidential  Information or this Settlement Agreement or are requested or required to disclose Confidential  Information or this Settlement Agreement in the course of routine supervisory examinations or  regulatory oversight by regulatory authorities with jurisdiction over such Party.  

C.    Notwithstanding  anything  contained  herein,  the  Parties  may  publicly  acknowledge that fact that there is a settlement between the Parties.   

D.    Within sixty (60) days after the Effective Date, AAMC shall file a current  report on Form 8-K announcing this Settlement Agreement and the Exchange, which Putnam shall  have the opportunity to review and comment upon prior to filing.  

9. Rules 144 and 144A and Regulation S.  

AAMC shall use reasonable best efforts to file the reports required to be filed by it under  the  Securities  Act  and  the  Exchange  Act  and  the  rules  and  regulations  adopted  by  the  SEC  thereunder (or, if AAMC is not required to file such reports, it will, upon the request of Putnam,  

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make publicly available such necessary information for so long as necessary to permit sales that  would otherwise be permitted by this Settlement Agreement pursuant to Rule 144, Rule 144A or  Regulation S under the Securities Act, as such rules may be amended from time to time, or any  similar rule or regulation hereafter adopted by the SEC), and it will take such further action as  Putnam may reasonably request, all to the extent required from time to time to enable Putnam to  sell the Common Shares without registration under the Securities Act pursuant to (a) Rule 144,  Rule 144A or Regulation S under the Securities Act, as such rules may be amended from time to  time, or (b) any similar rule or regulation hereafter adopted by the SEC.  Upon Putnam’s request,  AAMC  will  deliver  to  Putnam  a  written  statement  as  to  whether  it  has  complied  with  such  requirements and, if not, the specifics thereof.    
  
10.     Miscellaneous.

A.        Notices.  All notices, demands and other communications hereunder shall  be in writing and shall be deemed to have been duly given: (a) when personally delivered; (b) upon  actual receipt (as established by confirmation of receipt or otherwise) during normal business  hours, otherwise on the first business day thereafter, if transmitted by email with confirmation of  delivery; (c) when sent by overnight courier; in each case, to the following addresses, or to such  other addresses as a Party may from time to time specify by notice to the other Party given pursuant  hereto.   

If to Putnam, to:
  
Jason Tucker  
Putnam Investments   
Deputy General Counsel – Litigation  100 Federal Street  
Boston, MA 02110   
Jason_Tucker@putnam.com

If to AAMC, to:  

P. Graham Singer  
Altisource Asset Management Corporation
General Counsel and Secretary
5100 Tamarind Reef
Christiansted, VI 0082                        
graham.singer@altisourceamc.com 

with a copy to:   

Howard J. Kaplan
Michelle A. Rice
Kaplan Rice LLP
142 W. 57th Street, Suite 4A
New York, NY 10019  

                                                              
10

                       
hkaplan@kaplanrice.com
mrice@kaplanrice.com  

B.    Covenant Not to Take Action in Breach.  The Parties agree not to take any  actions that will result, whether directly or indirectly, in the breach of their respective obligations,  representations, warranties, agreements,  covenants or obligations contained in this Settlement  Agreement.  In addition to any owed monetary relief to an injured Party, any non-compliance with  and/or breach of this Settlement Agreement shall cause continuing and irreparable harm and injury  to the injured Party for which monetary damages are insufficient and entitle the injured Party to  injunctive  relief,  without  the  posting  of  any  bond  or  security,  from  any  court  of  competent  jurisdiction, including specific performance.  

C.    Governing Law/Jurisdiction.  This Settlement Agreement and the rights and  duties of the Parties hereunder will be governed by and construed, enforced and performed in  accordance with the law of the state of New York.  The Parties acknowledge and agree that the  New York Supreme Court shall have the exclusive jurisdiction over this Settlement Agreement  and that any claims arising out of or related in any manner to this Settlement Agreement shall be  properly brought only before the New York Supreme Court.     

D.    Entire  Agreement.    This  Settlement  Agreement  contains  the  entire  agreement among the Parties with respect to the subject matter hereof and there are no agreements,  understandings,  representations  or  warranties  among  the  Parties  other  than  those  set  forth  or  referred to herein.  The Settlement Agreement may be amended, modified or waived only by a  written instrument executed by each of the Parties.   

E.    Severability.  In case any provision of this Settlement Agreement shall be  determined to be invalid, illegal or unenforceable for any reason, the remaining provisions of this  Settlement Agreement shall be unaffected and unimpaired thereby, and shall remain in full force  and effect, to the fullest extent permitted by Applicable Law.   

F.    Survival of Representations.  All representations, warranties, agreements,  covenants and obligations herein are material, shall be deemed to have been relied upon by the  other Parties, and shall survive the date of the dismissal of the Litigation.  

G.    Successors and Assigns.  This Settlement Agreement shall be binding upon  and inure to the benefit of the Parties hereto and their respective successors and assigns, including,  with respect to Putnam, any successor investment fund as a result of any merger or reorganization  that is managed by the  investment manager  who acts on behalf of Putnam, and any Putnam  investment  fund  that  acquires  any  of  Common  Shares  paid  to  Putnam  under  this  Settlement  Agreement pursuant to Section 1(B) and Section 4.  

H.    No Admission.  The Parties understand and agree that this is a compromise  settlement of disputed claims and that neither this Settlement Agreement nor the payment or  acceptance of consideration hereunder is, nor shall they be construed, described or characterized  by any Party hereto or by its agents or representatives, as an admission by the Parties of any  liability or wrongdoing.  The making of this Settlement Agreement is not intended, and shall not  be construed, as an admission that any of the Parties has violated any federal, state, or local law  
                                                                
11

(statutory or decisional), ordinance or regulation, breached any contract, or committed any wrong  whatsoever.  The Parties further agree and understand that this Settlement Agreement is being  entered  into  solely  for  the  purpose  of  avoiding  further  expense  and  litigation  and  that  this  Settlement  Agreement  may  not  be  used  as  evidence  in  a  subsequent  proceeding  except  in  a  proceeding to enforce the terms of this Settlement Agreement.  

I.    Interpretation.  This Settlement Agreement has been jointly drafted by the  Parties at arm’s length and each Party has had ample opportunity to consult with independent legal  counsel.  No provision or ambiguity in this Settlement Agreement shall be resolved against any  Party by virtue of its participation in the drafting of this Settlement Agreement.   

J.    Attorneys’ Fees.  Each Party shall be responsible for the payment of its own  costs and expenses (including attorneys’ fees) relating to the Litigation, the matters referred to in  this Settlement Agreement, and the drafting of this Settlement Agreement. The prevailing party in  any litigation necessary to enforce this Settlement Agreement shall be entitled to its costs and  attorney’s fees. In addition, if it is necessary for Putnam to bring an action for breach of this  Settlement Agreement solely because of AAMC’s failure to make the Second Payment, Putnam  shall be entitled to all its costs and attorney’s fees.   

K.    Captions.  The captions of this Settlement Agreement are for convenience  only and are not a part of this Settlement Agreement and do not in any way limit or amplify the  terms and provisions of this Settlement Agreement and shall have no effect on its interpretation.   

L.    Counterparts.  This Settlement Agreement may be executed in counterparts,  by either an original signature or signature transmitted by facsimile transmission or email or other  similar process and each copy so executed shall be deemed to be an original and all copies so  executed shall constitute one and the same agreement.  

M.    A copy of the Agreement and Declaration of Trust of Putnam is on file  with the Secretary of The Commonwealth of Massachusetts, and notice is hereby given that this  Settlement  Agreement  is  executed  on  behalf  of  the  trustees  of  Putnam  as  trustees  and  not  individually and that any obligations of or arising out of this Settlement Agreement are not binding  on any of the trustees, officers or shareholders individually of Putnam, but are binding only upon  the trust property of Putnam. Furthermore, notice is given that the trust property of any series of  the series trust applicable to Putnam is separate and distinct and that any obligations of or arising  out of this Settlement Agreement are several and not joint or joint and several and are binding only  on the trust property of Putnam with respect to its obligations under this Settlement Agreement.  

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IN WITNESS WHEREOF, the Parties have signed this Settlement Agreement in multiple  counterparts.  

						
	PUTNAM FOCUSED EQUITY FUND, a series of Putnam Funds Trust
	By: Putnam Investment Management, LLC, as Investment Manager
	By:	/s/ Jason Tucker
		Name: Jason Tucker
		Title: Deputy General Counsel
	Date:	February 17, 2021
		

						
	ALTISOURCE ASSET MANAGEMENT CORPORATION
	
	By:	/s/ Indroneel Chatterjee
		Name: Indroneel Chatterjee
		Title: Chairman and Chief Executive Officer
	Date:	February 17, 2021
		

13Document

Exhibit 4.7

DESCRIPTION OF THE REGISTRANT'S SECURITIES
REGISTERED PURSUANT TO SECTION 12 OF THE
SECURITIES EXCHANGE ACT OF 1934

The following is a brief description of the common stock, $0.01 par value per share (the “Common Stock”), of Columbia Property Trust, Inc. (the “Company”), which is the only security of the Company registered pursuant to Section 12 of the Securities Exchange Act of 1934 (the “Exchange Act”).
Description of Common Stock
General
We were formed under the laws of the state of Maryland. The rights of our stockholders are governed by Maryland law as well as our charter and bylaws. The following summary of the terms of our common stock, the Maryland General Corporation Law (the “MGCL”) and the provisions of our charter and bylaws containing material terms of our common stock is only a summary, and reference should be made to the MGCL and our charter and bylaws for a full description. The following summary is qualified in its entirety by the more detailed information contained in our charter and bylaws. Copies of our charter and bylaws are available upon request.
Common Stock
Subject to any preferential rights of any other class or series of stock and to the provisions of our charter regarding the restrictions on the ownership and transfer of common stock, the holders of common stock are entitled to such distributions as may be authorized from time to time by our board of directors out of legally available funds and declared by us and, upon our liquidation, are entitled to receive all assets available for distribution to our stockholders. All common stock issued and outstanding is fully paid and nonassessable. Holders of common stock will not have preemptive rights, which means that they will not have an automatic option to purchase any new shares that we issue, or preference, conversion, exchange, sinking fund or redemption rights. Our charter provides that our common stockholders generally have no appraisal rights unless our board of directors determines prospectively that appraisal rights will apply to one or more transactions in which holders of our common stock would otherwise be entitled to exercise appraisal rights. Shares of our common stock have equal distribution, liquidation and other rights.
Our board of directors has authorized the issuance of shares of our capital stock without certificates. We do not issue certificates for our shares. Shares are held in “uncertificated” form which eliminates the physical handling and safekeeping responsibilities inherent in owning transferable share certificates and eliminate the need to return a duly executed share certificate to effect a transfer. Information regarding restrictions on the transferability of our shares that, under Maryland law, would otherwise have been required to appear on our share certificates will instead be furnished to stockholders upon request and without charge. We maintain a stock ledger that contains the name and address of each stockholder and the number of shares that the stockholder holds. With respect to uncertificated stock, we will continue to treat the stockholder registered on our stock ledger as the owner of the shares until the new owner delivers a properly executed form to us, which form we will provide to any registered holder upon request.

Preferred Stock
Our charter authorizes our board of directors to designate and issue one or more classes or series of preferred stock without stockholder approval. Our board of directors may determine the relative rights, preferences and privileges of each class or series of preferred stock so issued, which may be more beneficial than the rights, preferences and privileges attributable to the common stock. The issuance of preferred stock could have the effect of delaying or preventing a change in control. We currently have no preferred stock issued or outstanding. Our board of directors has no present plans to issue preferred stock, but may do so at any time in the future without stockholder approval.
Power to Reclassify Our Unissued Shares of Stock
Our charter authorizes our board of directors to classify any unissued shares of preferred stock and to reclassify any previously classified but unissued shares of common or preferred stock into one or more classes or series of preferred stock without any action by our stockholders. Prior to the issuance of shares of each class or series, our board of directors is required by Maryland law and by our charter to set, subject to the provisions of our charter regarding the restrictions on transfer and ownership of our stock, the preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications and terms and conditions of redemption of each such class or series. As a result, our board of directors could authorize the issuance of shares of preferred stock that have priority over shares of our common stock with respect to dividends or other distributions or rights upon liquidation or with other terms and conditions that could have the effect of delaying, deferring or preventing a transaction or a change of control of our company that might involve a premium price for holders of our common stock or that our common stockholders otherwise believe to be in their best interests. As of the date hereof, no shares of preferred stock are outstanding and we have no present plans to issue any shares of preferred stock.
Power to Increase or Decrease Authorized Shares of Common Stock and Issue Additional Shares of Common and Preferred Stock
Our charter authorizes our board of directors to amend our charter without stockholder approval to increase or decrease the number of authorized shares of stock, to issue additional authorized but unissued shares of common or preferred stock and to classify or reclassify unissued shares of common or preferred stock and thereafter to issue such classified or reclassified shares of stock without any action by our stockholders. We believe that the power to classify or reclassify unissued shares of stock and thereafter issue the classified or reclassified shares provides us with increased flexibility in structuring possible future financings and acquisitions and in meeting other needs that might arise. The additional classes or series, as well as the additional authorized shares of common stock, will be available for issuance without further action by our stockholders, unless such action is required by applicable law or the rules of any stock exchange or market system on which our securities may be listed or traded. Although our board of directors does not currently intend to do so, it could authorize us to issue a class or series of stock that could, depending upon the terms of the particular class or series, delay, defer or prevent a transaction or a change of control of our company that might involve a premium price for holders of our common stock or that our common stockholders otherwise believe to be in their best interests.
Meetings and Special Voting Requirements
Subject to our charter restrictions on ownership and transfer of our stock and except as may otherwise be specified in the terms of any class or series of common stock, each holder of common stock is entitled at each meeting of stockholders to one vote per share owned by such stockholder on all 

matters submitted to a vote of stockholders, including the election of directors. Each of our directors is elected to serve for a one-year term, until the next annual meeting of stockholders and until his or her successor is duly elected and qualifies. There is no cumulative voting in the election of our board of directors. A nominee for director is elected only if such nominee receives the affirmative vote of a majority of the total votes cast with respect to such nominee, provided that if the number of nominees exceeds the number of directors to be elected, the directors are elected by a plurality of the votes cast in the election of the directors. 
An annual meeting of our stockholders will be held each year. Special meetings of stockholders may be called by our board of directors, the chairman of the board, the president or the chief executive officer and, subject to certain procedural requirements set forth in our bylaws, must be called by our Secretary to act on any matter that may properly be considered at a meeting of stockholders upon the written request of stockholders entitled to cast at least a majority of the votes entitled to be cast on such matter at such meeting. The presence, either in person or by proxy, of stockholders entitled to cast a majority of all the votes entitled to be cast at a meeting on any matter will constitute a quorum.
Pursuant to our charter and the MGCL, we cannot dissolve, amend our charter, merge, convert, sell all or substantially all of our assets, engage in a share exchange or engage in similar transactions outside the ordinary course of business unless declared advisable by our board of directors and approved by the affirmative vote of stockholders entitled to cast at least a majority of all the votes entitled to be cast on the matter. However, under the MGCL and our charter, the following events do not require stockholder approval:
•stock exchanges in which we are the successor; and
•transfers of less than substantially all of our assets.
Also, our operating assets are held by our subsidiaries and these subsidiaries may be able to merge or sell all or substantially all of their assets without the approval of our stockholders.
No Stockholder Rights Plan
We have no stockholder rights plan. Our bylaws contain a provision preventing the board of directors from adopting a stockholder rights plan without the prior approval of the stockholders unless such plan provides that it will expire within one year of adoption unless ratified by the stockholders before the plan expires. Our bylaws further prevent the board of directors from amending this limitation without stockholder approval.
Business Combinations
Under the MGCL, certain “business combinations” (including a merger, consolidation, share exchange or, in certain circumstances, 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 following the most recent date on which the interested stockholder became 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 after the date on which the corporation had 100 or more beneficial owners of its stock; or

•an affiliate or associate of the corporation who, at any time within the two-year period prior to the date in question and after the date on which the corporation had 100 or more beneficial owners of its stock, was the beneficial owner, directly or indirectly, of 10% or more of the voting power of the then outstanding stock of the corporation.
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. Our board of directors has adopted a resolution exempting any business combinations between us and any other person or entity from the business combination provisions of the MGCL. Our bylaws provide that this resolution may only be revoked, altered or amended, and the board of directors may only adopt any resolution inconsistent with this resolution (including an amendment to that provision), with the affirmative vote of a majority of the votes cast on the matter by holders of outstanding shares of the Company's common stock. However, we cannot assure you that our board of directors will not recommend to stockholders that the board of directors revoke, alter or amend this resolution in the future.
Control Share Acquisitions
The MGCL provides that holders of “control shares” of a Maryland corporation acquired in a “control share acquisition” have no voting rights with respect to any control shares except to the extent approved at a special meeting of stockholders by the affirmative vote of at least two-thirds of the votes entitled to be cast on the matter, excluding shares of stock of a corporation in respect of which any of the following persons is entitled to exercise or direct the exercise of the voting power of such shares in the election of directors: (a) a person who makes or proposes to make a control share acquisition; (b) an officer of the corporation; or (c) an employee of the corporation who is also a director of the corporation. “Control shares” are voting shares of stock which, 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 of voting power:
•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 our board of directors to call a special meeting of stockholders to be held within 50 days of demand to consider the voting rights of the shares acquired or to be acquired in the control share acquisition. If no request for a special meeting is made, the corporation may itself present the question at any stockholders meeting.
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 any meeting of stockholders at which the voting rights of such shares are considered and not approved or, if no such meeting is held, the date of the last control share acquisition by the acquirer. 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, unless appraisal rights are eliminated under the charter. Our charter eliminates all appraisal rights of stockholders.
The control share acquisition provisions of the MGCL do not apply to: (a) shares acquired in a merger, consolidation or share exchange if the corporation is a party to the transaction, or (b) acquisitions approved or exempted by the charter or bylaws of the corporation.
Our bylaws contain a provision exempting the Company from the control share acquisition provisions of the MGCL. This provision may be amended only with the affirmative vote of a majority of the votes entitled to be cast on such an amendment by holders of outstanding shares of our common stock.
Unsolicited Takeovers
Under Subtitle 8 of Title 3 of the MGCL, a Maryland corporation with a class of equity securities registered under the Exchange Act and at least three directors who are not officers or employees of the corporation, and who are not affiliated with a person who is seeking to acquire control of the corporation, may elect to be subject, 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 any or all of the following five provisions:
•a classified board requirement;
•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 the remaining directors and for the remainder of the full term of the class of directors in which the vacancy occurred; or
•a requirement for the calling of a special meeting of stockholders only at the written request of stockholders entitled to cast at least a majority of the votes at the meeting.

Our charter provides that our board of directors may not take action to elect to be subject to the provisions of Subtitle 8 except 3-804(c) of the MGCL, which permits a company to include a provision in its charter requiring a vacancy on the board of directors be filled only by the remaining directors and any director so elected to serve for the remainder of the full term of the class of directors in which the vacancy occurred, which provision is included in our charter. Through a provision in our bylaws unrelated to Subtitle 8, we require, unless called by our board of directors, the chairman of the board, the president or the chief executive officer, the request of stockholders entitled to cast not less than a majority of all votes entitled to be cast on any matter that may properly be considered at a meeting of stockholders to call a special meeting to consider and vote on such matter. As a result, the effect of the restriction on electing to be subject to the provisions of Subtitle 8 is to prevent us, without the approval of the stockholders, from (1) classifying our board of directors, (2) raising the threshold for removal of a director from a majority to two-thirds of the votes entitled to be cast generally in the election of directors, or (3) negating the stockholders’ power to amend the bylaws to fix the number of directorships.
Restriction on Transfer and Ownership of Shares
In order for us to qualify as a real estate investment trust, or REIT, not more than 50% of our outstanding shares may be owned by any five or fewer individuals, including some tax-exempt entities. In addition, the outstanding shares must be owned by 100 or more persons independent of us and each other during at least 335 days of a 12-month taxable year or during a proportionate part of a shorter taxable year. We may prohibit certain acquisitions and transfers of shares so as to ensure our continued qualification as a REIT under the Internal Revenue Code.
In order to assist us in preserving our status as a REIT, our charter contains a limitation on ownership that prohibits any person or group of persons from acquiring, directly or indirectly, beneficial ownership of more than 9.8% in value of our outstanding shares of capital stock or more than 9.8% in value or in number of shares, whichever is more restrictive, of our outstanding shares of common stock.
Shares which, if transferred, would be in excess of the ownership limit will be designated as “shares-in-trust” and will be transferred automatically to a trust effective on the day before the reported transfer of such shares. The record holder of the shares that are designated as shares-in-trust will be required to submit such number of shares to us in the name of the trustee of the trust. We will designate a trustee of the share trust that will not be affiliated with us. We will also name one or more charitable organizations as a beneficiary of the share trust. Shares-in-trust will remain issued and outstanding shares and will be entitled to the same rights and privileges as all other shares of the same class or series. The trustee will receive all dividends and other distributions on the shares-in-trust and will hold such dividends or other distributions in trust for the benefit of the beneficiary. The trustee will vote all shares-in-trust during the period they are held in trust.  If the transfer to the trust would not be effective for any reason to prevent a violation of the share ownership limitation, our charter provides that the transfer of that number of shares that would otherwise cause the violation will be null and void and the intended transferee will acquire no rights in such shares.  Upon receipt of information (including certain representations and undertakings required by our charter) that a proposed transfer of shares would not violate the provisions of the Internal Revenue Code for qualification as a REIT, our board of directors, in its sole discretion, may exempt a person from the share ownership limitation or establish or increase an excepted holder limit for such person.
At our direction, the trustee will transfer the shares-in-trust to a person whose ownership will not violate the ownership limit. The transfer must be made within 20 days of our receipt of notice that shares have been transferred to the trust. During this 20-day period, we will have the option of 

redeeming such shares. Upon any such transfer or redemption, the purported transferee or holder will receive a per share price equal to the lesser of (1) the price per share in the transaction that created such shares-in-trust (or, in the case of a devise or gift, the market price per share at the time of the devise or gift), or (2) in the case of a transfer, the price per share received by the trustee from the transfer of the shares-in trust and, in the case of a redemption, the market price per share on the date of the redemption.
Any person who (1) acquires shares in violation of the foregoing restrictions or who would have owned shares that were transferred to any such trust is required to give immediate written notice to us of such event, or (2) proposes or attempts to transfer shares subject to such limitations is required to give us 15 days written notice prior to such transaction. In both cases, such persons shall provide to us such other information as we may request in order to determine the effect, if any, of such transfer on our status as a REIT.
The foregoing restrictions will continue to apply until we determine that (1) it is no longer in our best interest to attempt to, or continue to, qualify as a REIT or (2) compliance with such restrictions is no longer required for REIT qualification.
The ownership limit does not apply to the underwriter in a public offering of shares or to a person or persons exempted from the ownership limit by our board of directors based upon appropriate assurances, including certain representations and undertakings required by our charter, that our qualification as a REIT is not jeopardized.
Any person who owns 5% or more of the outstanding shares during any taxable year will be asked to deliver a statement or affidavit setting forth the number of shares beneficially owned, directly or indirectly.
Dividends
We are required to make distributions sufficient to satisfy the requirements for qualification as a REIT for tax purposes. Generally, income distributed as dividends will not be taxable to us under the Internal Revenue Code if we distribute at least 90% of our taxable income. One of our primary goals is to pay regular quarterly distributions to our stockholders. Distributions will be paid to investors who are stockholders as of the record dates selected by our board of directors. Distributions are declared at the discretion of our board of directors.
Stockholder Liability
The MGCL provides that our stockholders:
•are not liable personally or individually in any manner whatsoever for any debt, act, omission or obligation incurred by us or our board of directors; and
•are under no obligation to us or our creditors with respect to their shares other than the obligation to pay to us the full amount of the consideration for which their shares were issued.
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 the 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 both at the time of giving of the notice required by our bylaws and at the time of the annual meeting, who is entitled to vote at the meeting in the election of each individual so nominated or on such other business and who has provided notice to us with respect to the time period containing the information and certifications, required by the advance notice procedures set forth in our bylaws.
•with respect to special meetings of stockholders, only the business specified in our notice of meeting may be brought before the 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 meeting has been called for the purpose of electing directors, by a stockholder who is a stockholder of record both at the time of giving of the notice required by our bylaws and at the time of the meeting, who is entitled to vote at the meeting in the election of each individual so nominated and who has provided notice to us within the time period and containing the information and certifications required by the advance notice procedures set forth in our bylaws.
The purpose of requiring stockholders to give advance notice of nominations and other proposals is to afford our board of directors 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. The advance notice procedures also permit a more orderly procedure for conducting our stockholder meetings.

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