Document:

Exhibit 10.3

 

Innovative
INDUSTRIAL properties, inc.

RESTRICTED STOCK PURCHASE AGREEMENT

 

This Restricted Stock
Purchase Agreement (the “Agreement”) is made as of ______, 2016 (the “Effective Date”) by
and between Innovative Industrial Properties, Inc., a Maryland corporation (“Company”), and [Name of Founder],
an adult resident of [State] (“Purchaser”).

 

WHEREAS, Company desires
to sell to Purchaser and Purchaser desires to buy from Company an aggregate of [               
] ([      ]) shares of Company’s Class B Common Stock (the “Shares”); and

 

WHEREAS, Purchaser
and Company desire to subject the Shares to a Repurchase Option (as defined below).

 

NOW, THEREFORE, In
consideration of the mutual covenants and representations set forth herein and for good and valuable consideration the sufficiency
of which is hereby acknowledged, Company and Purchaser agree as follows:

 

1.            Purchase
and Sale of the Shares. Subject to the terms and conditions of this Agreement, Company agrees
to sell to Purchaser and Purchaser agrees to purchase from Company on the Effective Date the Shares at a price of $0.01 per share
(the “Purchase Price”), for an aggregate Purchase Price of [       ] Dollars ($[   
]). 

 

In partial consideration
for the Shares and the right to purchase the Shares, effective as of the Effective Date, Purchaser hereby transfers and assigns
to Company (i) any business plan of Company (the “Business Plan”) and (ii) any and all right, title and interest
Purchaser has in Company’s business and any Intellectual Property (as defined below) related to Company’s business,
as currently conducted and as contemplated to be conducted pursuant to the Business Plan or otherwise. For purposes hereof, “Intellectual
Property” means: (i) United States and foreign patents, trademarks, copyrights and mask works, registrations and applications
therefor, and rights granted upon any reissue, division, continuation or continuation-in-part thereof, (ii) trade secret rights
arising out of the laws of any and all jurisdictions, (iii) ideas, inventions, concepts, technology, software, methods, processes,
drawings, illustrations, writings know-how, show-how, trade names, domain names, web addresses and web sites, and all rights therein
and thereto, (iv) any other intellectual property rights, whether or not registerable, and (v) licenses in or to any of the foregoing.
Further, Purchaser agrees to take all actions reasonably requested by Company to assist Company in effecting the foregoing transfer
and in establishing, perfecting, defending, enforcing and protecting Company’s rights in any of the above transferred items,
including without limitation assisting in the prosecution of any patent applications included in or based upon the Intellectual
Property.

 

    	 	 	 

    	 	 	 

    

 

2.            Repurchase
Option. All of the Shares shall be subject to the Repurchase Option (as defined below). If, for
any reason, the Purchaser ceases his or her affiliation with Company by virtue of no longer being either a director, an employee
or a consultant of Company (a “Service Provider”), including Purchaser’s death, disability, voluntary
resignation or termination by the Company with or without cause, then Company shall, upon the date of such termination (as reasonably
fixed and determined by Company), have the right, but not the obligation (the “Repurchase Option”), for a period
of ninety (90) days from such date, to repurchase the Shares which have not yet been released from the Repurchase Option (the
“Unreleased Shares”) at a price per share equal to the lesser of (x) the fair market value of the shares
at the time the Repurchase Option is exercised, as determined by Company’s board of directors and (y) the Purchase Price
(the “Repurchase Price”). The Repurchase Option shall be exercised by Company by delivering written notice to
Purchaser and by delivering to Purchaser a check in the amount of the aggregate Repurchase Price. Upon delivery of such notice
and the payment of the aggregate Repurchase Price, Company shall become the legal and beneficial owner of the Unreleased Shares
being repurchased and all rights and interests therein or relating thereto, and Company shall have the right to retain and transfer
to its own name the number of Unreleased Shares being repurchased by Company. Company in its sole discretion may designate and
assign one or more employees, officers, directors or stockholders of Company or other persons or organizations to exercise all
or a part of Company’s Repurchase Option to purchase all or a part of the Unreleased Shares.

 

3.            Release
of Shares From Repurchase Option; Vesting.

 

(a)          So
long as Purchaser’s continuous status as a Service Provider has not yet terminated in each such instance, twenty-five percent
(25%) of the Shares shall be released from the Repurchase Option on the twelve month anniversary of this Agreement and an additional
two and one-twelfth percent (2.083%) of the Shares shall be released from the Repurchase Option on the last day of each calendar
month thereafter, commencing on and including July 31, 2017, until all of the Shares shall have been released from the Repurchase
Option (the “Released Shares”).

 

Notwithstanding anything
else herein to the contrary, in the event of a Change of Control (defined below), any and all Shares that have not been released
from the Repurchase Option shall be released from the Repurchase Option immediately prior to the Change of Control.

 

(b)          For
purposes of this Agreement, a “Change of Control” means either:

 

(i)       the
acquisition of Company by another entity by means of any transaction or series of related transactions (including, without limitation,
any reorganization, merger or consolidation or stock transfer, but excluding any such transaction effected primarily for the purpose
of changing the domicile of Company), unless Company’s stockholders of record immediately prior to such transaction or series
of related transactions hold, immediately after such transaction or series of related transactions, at least fifty percent (50%)
of the voting power of the surviving or acquiring entity (provided that the sale by Company of its securities for the purposes
of raising additional funds shall not constitute a Change of Control hereunder); or

 

(ii)      a
sale of all or substantially all of the assets of Company, other than such transaction effected primarily for the purpose of changing
the domicile of Company.

 

    	 	2	 

    	 	 	 

    

 

4.            Restrictions
on Transfer.

 

(a)            Purchaser
hereby makes the investment representations listed on Exhibit A to Company as of the date of this Agreement and as
of the date of the Closing, and agrees that such representations are incorporated into this Agreement by this reference, such that
Company may rely on them in issuing the Shares. Purchaser understands and agrees that the legends set forth below, or substantially
equivalent legends, will be placed upon any certificate(s) evidencing ownership of the Shares, together with any other legends
that may be required by Company or by applicable state or federal securities laws:

 

THE SECURITIES REPRESENTED HEREBY
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE “ACT”) AND MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT OR, IN THE OPINION OF COUNSEL SATISFACTORY TO THE
ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION OTHERWISE COMPLIES WITH THE ACT.

 

THE
SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER, A MARKET STANDOFF PROVISION, A RIGHT OF
FIRST REFUSAL, AND, FOR SOME OF THE SHARES REPRESENTED BY THIS CERTIFICATE, A REPURCHASE OPTION HELD BY THE ISSUER OR ITS ASSIGNEE(S)
AS SET FORTH IN THE RESTRICTED STOCK PURCHASE AGREEMENT BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF THESE SHARES, A COPY OF WHICH
MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER. SUCH TRANSFER RESTRICTIONS, MARKET STANDOFF PROVISION, RIGHT OF FIRST REFUSAL
AND REPURCHASE OPTION ARE BINDING ON TRANSFEREES OF THESE SHARES.

 

(b)            Stop-Transfer
Notices. Purchaser agrees that to ensure compliance with the restrictions referred to herein, Company may issue
appropriate “stop transfer” instructions to its transfer agent, if any, and that, if Company transfers its own
securities, it may make appropriate notations to the same effect in its own records.

 

(c)            Refusal
to Transfer. Company shall not be required (i) to transfer on its books any Shares that have been sold or otherwise transferred
in violation of any of the provisions of this Agreement or (ii) to treat as owner of such Shares or to accord the right to
vote or pay dividends to any purchaser or other transferee to whom such Shares shall have been so transferred.

 

(d)            Lock-Up
Period. In connection with any public offering of the Company’s securities and upon request of Company or the
underwriters or placement agents for such offering of Company’s securities, Purchaser agrees not to sell, make any
short sale of, loan, grant any option for the purchase of, or otherwise dispose of any securities of Company however or
whenever acquired (other than those included in the registration) without the prior written consent of Company or such
underwriters or placement agents, as the case may be, for such period of time (not to exceed 180 days but subject to such
extension or extensions as may be required by the underwriters in order to publish research reports while complying with the
Financial Industry Regulatory Authority and the New York Stock Exchange) from the effective date of such registration as may
be requested by Company or such underwriters or placement agents and to execute an agreement reflecting the foregoing as may
be requested by the underwriters or placement agents at the time of the public offering.

 

    	 	3	 

    	 	 	 

    

 

(e)            Unreleased
Shares. No Unreleased Shares subject to the Repurchase Option contained in Section 2 of this Agreement, nor any
beneficial interest in such Unreleased Shares, shall be sold, gifted, transferred, encumbered or otherwise disposed of in any
way (whether by operation of law or otherwise) by Purchaser.

 

(f)            Released
Shares. No Released Shares, nor any beneficial interest in such Released Shares, shall be sold, transferred, encumbered
or otherwise disposed of in any way (whether by operation of law or otherwise) by Purchaser or any subsequent transferee, other
than in compliance with Company’s right of first refusal provisions contained in Section 5 of this Agreement.

 

5.            Company’s
Right of First Refusal. Before any Released Shares (or any beneficial interest in such Released Shares) may be sold,
transferred, encumbered or otherwise disposed of in any way (whether by operation of law or otherwise) by Purchaser or any subsequent
transferee (each a “Holder”), such Holder must first offer such Released Shares or beneficial interest to Company
and/or its assignee(s) as follows:

 

(a)            Notice
of Proposed Transfer. Holder shall deliver to Company a written notice stating: (i) Holder’s bona fide intention
to sell or otherwise transfer the Released Shares; (ii) the name of each proposed transferee; (iii) the number of Released
Shares to be transferred to each proposed transferee; (iv) the bona fide cash price or other consideration for which Holder
proposes to transfer the Released Shares; and (v) that by delivering the notice, Holder offers all such Released Shares to
Company and/or its assignee(s) pursuant to this Section and on the same terms described in the notice.

 

(b)            Exercise
of Right of First Refusal. At any time within thirty (30) days after receipt of Holder’s notice, Company and/or its assignee(s)
may, by giving written notice to Holder, elect to purchase all, but not less than all, of the Released Shares proposed to be transferred
to any one or more of the proposed transferees, at the purchase price determined in accordance with Section 5(c).

 

(c)            Purchase
Price. The purchase price for the Released Shares purchased by Company and/or its assignee(s) under this Section shall be the
lesser of (i) the price listed in Holder’s notice or (ii) the fair market value as determined by the Board of Directors in
its sole discretion. If the price listed in Holder’s notice includes consideration other than cash, the cash equivalent value
of the non-cash consideration shall be determined by the Board of Directors of Company in its sole discretion.

 

    	 	4	 

    	 	 	 

    

 

(d)            Payment.
Payment of the purchase price shall be made, at the option of Company and/or its assignee(s), in cash (by check), by cancellation
of all or a portion of any outstanding indebtedness of Holder to Company and/or its assignee(s), or by any combination thereof
within thirty (30) days after receipt by Company of Holder’s notice (or at such later date as is called for by such
notice).

 

(e)            Holder’s
Right to Transfer. If all of the Released Shares proposed in the notice to be transferred to a given proposed transferee are
not purchased by Company and/or its assignee(s) as provided in this Section, then Holder may sell or otherwise transfer such Released
Shares to that proposed transferee, provided that: (i) the transfer is made only on the terms provided for in the notice,
with the exception of the purchase price, which may be either the price listed in the notice or any higher price; (ii) such
transfer is consummated within sixty (60) days after the date the notice is delivered to Company; (iii) the transfer
is effected in accordance with any applicable securities laws, and if requested by Company, Holder shall have delivered an opinion
of counsel acceptable to Company to that effect; and (iv) the proposed transferee agrees in writing that the provisions of
this Section shall continue to apply to the transferred Released Shares in the hands of such proposed transferee. If any Released
Shares described in a notice are not transferred to the proposed transferee within the period provided above, then before any such
Released Shares may be transferred, a new notice shall be given to Company, and Company and/or its assignees shall again be offered
the right of first refusal described in this Section.

 

(f)            Exception
for Certain Family Transfers. Notwithstanding anything to the contrary contained elsewhere in this Section, the transfer of
any or all of the Released Shares during Holder’s lifetime or on Holder’s death by will or intestacy to Holder’s
spouse, child, father, mother, brother, sister, or to a trust or other similar estate planning vehicle for the benefit of Holder
or any of the foregoing persons, shall be exempt from the provisions of this Section; provided that, in each such case, the transferee
shall agree in writing to receive and hold the Released Shares so transferred subject to all of the provisions of this Agreement,
including but not limited to this Section, and there shall be no further transfer of such Released Shares except in accordance
with the terms of this Section.

 

(g)            Termination
of Right of First Refusal. The right of first refusal contained in this Section shall terminate as to all Released Shares purchased
hereunder upon the earlier of: (i) the closing date of the initial public offering of Common Stock of Company registered pursuant
to the Act (“IPO”), and (ii) the closing date of a change of control of Company pursuant to which Holders
of the outstanding voting securities of Company receive securities of a class registered pursuant to Section 12 of the Securities
Exchange Act of 1934, as amended.

 

6.            Tax
Consequences. Purchaser has reviewed with Purchaser’s own tax advisors the federal, state, local and foreign tax consequences
of this investment and the transactions contemplated by this Agreement. Purchaser is relying solely on such advisors and not on
any statements or representations of Company or any of its agents. Purchaser understands that Purchaser (and not Company) shall
be responsible for any tax liability that may arise as a result of the transactions contemplated by this Agreement. Purchaser
understands that Section 83 of the Internal Revenue Code of 1986, as amended (the “Code”), taxes as ordinary
income the difference between the purchase price for the Shares and the fair market value of the Shares as of the date any restrictions
on the Shares lapse. In this context, “restriction” includes the right of Company to buy back the Shares pursuant
to the Repurchase Option. Purchaser understands that Purchaser may elect to be taxed at the time the Shares are purchased rather
than when and as the Repurchase Option expires by filing an election under Section 83(b) of the Code with the IRS within
30 days from the date of purchase. THE FORM FOR MAKING THIS SECTION 83(B) ELECTION IS ATTACHED TO THIS AGREEMENT AS EXHIBIT B
AND PURCHASER (AND NOT COMPANY OR ANY OF ITS AGENTS) SHALL BE SOLELY RESPONSIBLE FOR APPROPRIATELY FILING SUCH FORM, EVEN IF PURCHASER
REQUESTS COMPANY OR ITS AGENTS TO MAKE THIS FILING ON PURCHASER’S BEHALF.

 

    	 	5	 

    	 	 	 

    

 

7.            Escrow.
As security for Purchaser’s faithful performance of this Agreement, Purchaser agrees, immediately
upon receipt of the stock certificate(s) evidencing the Shares, to deliver such certificate(s), together with the Stock Powers
executed by Purchaser and by Purchaser’s spouse, if any (with the date, transferee, stock certificate number and number
of Shares left blank), to the Secretary of the Company or other designee of the Company (the “Escrow Holder”),
who is hereby appointed to hold such certificate(s) and Stock Powers in escrow and to take all such actions and to effectuate
all such transfers and/or releases of such Shares as are in accordance with the terms of this Agreement. Escrow Holder will act
solely for the Company as its agent and not as a fiduciary. Purchaser and the Company agree that Escrow Holder will not be liable
to any party to this Agreement (or to any other party) for any actions or omissions unless Escrow Holder is grossly negligent
or intentionally fraudulent in carrying out the duties of Escrow Holder under this Agreement. Escrow Holder may rely upon any
letter, notice or other document executed with any signature purported to be genuine and may rely on the advice of counsel and
obey any order of any court with respect to the transactions contemplated by this Agreement. The Shares will be released from
escrow upon termination of both the Repurchase Option and the “Right of First Refusal” set forth in Section 5.

 

8.            General
Provisions.

 

(a)          Choice
of Law; Entire Agreement. This Agreement shall be governed by the internal substantive laws, but not the choice of law rules,
of California.

 

(b)          Integration.
This Agreement represents the entire agreement between the parties with respect to the purchase of the Shares and supersedes and
replaces any and all prior written or oral agreements regarding the subject matter of this Agreement including, any representations
made during any interviews, discussions or negotiations whether written or oral.

 

(c)          Notices.
All notices and other communications required or permitted hereunder shall be in writing and shall be mailed by registered or certified
mail, postage prepaid, sent by facsimile or electronic mail or otherwise delivered by hand or by messenger addressed:

 

(i)       if
to Purchaser, at Purchaser’s address, facsimile number or electronic mail address as shown in Company’s records, as
may be updated in accordance with the provisions hereof;

 

(ii)      if
to Company, one copy should be sent to Innovative Industrial Properties, Inc., Attention: Secretary, at such address as Company
shall have furnished to Purchaser, with a copy to Foley & Lardner LLP, c/o Carrie Long, 3579 Valley Centre Drive, Suite 300,
San Diego, CA 92130.

 

    	 	6	 

    	 	 	 

    

 

(d)            Successors.
Any successor to Company (whether direct or indirect and whether by purchase, merger, consolidation, liquidation or otherwise)
to all or substantially all of Company’s business and/or assets shall assume the obligations under this Agreement and agree
expressly to perform the obligations under this Agreement in the same manner and to the same extent as Company would be required
to perform such obligations in the absence of a succession. For all purposes under this Agreement, the term “Company”
shall include any successor to Company’s business and/or assets which executes and delivers the assumption agreement described
in this Section or which becomes bound by the terms of this Agreement by operation of law. Subject to the restrictions on transfer
set forth in this Agreement, this Agreement shall be binding upon Purchaser and his or her heirs, executors, administrators, successors
and assigns.

 

(e)            Assignment.
The rights granted to Purchaser under this Agreement are not assignable by Purchaser under any circumstances.

 

(f)            Waiver.
Either party’s failure to enforce any provision of this Agreement shall not in any way be construed as a waiver of any such
provision, nor prevent that party from hereafter enforcing any other provision of this Agreement. The rights granted to both parties
hereunder are cumulative and shall not constitute a waiver of either party’s right to assert any other legal remedy available
to it.

 

(g)            Purchaser
Investment Representations and Further Documents. Purchaser agrees upon request to execute any further documents or instruments
necessary or reasonably desirable in the view of Company to carry out the purposes or intent of this Agreement, including Exhibits A,
B and C of this Agreement.

 

(h)            Severability.
Should any provision of this Agreement be found to be illegal or unenforceable, the other provisions shall nevertheless remain
effective and shall remain enforceable to the greatest extent permitted by law.

 

(i)            Rights
as Stockholder. Subject to the terms and conditions of this Agreement, Purchaser shall have all of the rights of a stockholder
of Company with respect to the Shares from and after the date that Purchaser delivers a fully executed copy of this Agreement (including
all exhibits and attachments thereto) and full payment for the Shares to Company, and until such time as Purchaser disposes of
the Shares in accordance with this Agreement. Upon such transfer, Purchaser shall have no further rights as a holder of the Shares
except (in the case of a transfer to Company) the right to receive payment for the Shares in accordance with the provisions of
this Agreement, and Purchaser shall forthwith cause the certificate(s) evidencing the Shares to be surrendered to Company for transfer
or cancellation.

 

(j)            Adjustment
for Stock Split. All references to the number of Shares and the purchase price of the Shares in this Agreement shall be adjusted
to reflect any stock split, stock dividend or other change in the Shares which may be made after the date of this Agreement.

 

    	 	7	 

    	 	 	 

    

 

(k)            Service
Provider at Will. PURCHASER ACKNOWLEDGES AND AGREES THAT THE VESTING OF REPURCHASE SHARES PURSUANT TO THIS AGREEMENT IS EARNED
ONLY BY CONTINUING SERVICE AS A SERVICE PROVIDER AT WILL (AND NOT THROUGH THE ACT OF BEING HIRED OR PURCHASING SHARES HEREUNDER).
PURCHASER FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE
SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING
PERIOD, OR FOR ANY PERIOD AT ALL, AND SHALL NOT INTERFERE WITH PURCHASER’S RIGHT OR COMPANY’S RIGHT TO TERMINATE PURCHASER’S
RELATIONSHIP WITH COMPANY AT ANY TIME, WITH OR WITHOUT CAUSE OR NOTICE.

 

(l)            Arbitration.
If a dispute arises out of or relates to this Agreement, or its breach, and the parties have not been successful in resolving such
dispute through negotiation, Purchaser agrees that the parties will attempt to resolve the dispute through mediation by submitting
the dispute to a sole mediator selected by the parties or, at any time at the option of a party, to mediation by the American Arbitration
Association (“AAA”). If not thus resolved, it shall be referred to a sole arbitrator selected by the parties
within thirty (30) days of the mediation or, in the absence of such selection, to final and binding arbitration by a sole arbitrator
under the AAA Arbitration Rules (“Rules”) in effect on the date of this Agreement. The mediation and arbitration,
including arguments and briefs, shall be in the English language in the City of San Diego, California. Purchaser also agrees that
the arbitrator shall have the power to award any remedies, including attorneys’ fees and costs (including arbitration costs),
available under applicable law. The decision of the arbitrator shall be in writing. The arbitrator shall apply the substantive
law of the State of California without giving effect to any principles of conflict of laws under the laws of the State of California.
Any monetary award by the arbitrator shall be in United States Dollars only. Judgment upon the award rendered in the arbitration
may be entered in any court having jurisdiction thereof. Purchaser agrees that each party shall bear its own expenses (including
attorney’s fees) and an equal share of the expenses of the mediator and arbitrator and the fees of the AAA. The parties,
their representatives, other participants and the mediator and arbitrator shall hold the existence, content and result of the mediation
and arbitration in confidence. Nothing in this section shall be construed to preclude any party from seeking injunctive relief
in order to protect its rights pending mediation or arbitration. A request by a party to a court for such injunctive relief shall
not be deemed a waiver or violation of the obligation to mediate or arbitrate. In addition to the right under the Rules to petition
the court for provisional relief, Purchaser agrees that any party may also petition the court for injunctive relief where either
party alleges or claims a violation of any confidential information or invention assignment agreement between Purchaser and Company
or any other agreement regarding trade secrets, confidential information, or non-solicitation. If either party seeks injunctive
relief, the prevailing party shall be entitled to recover reasonable costs and attorneys’ fees.

 

(m)            Counterparts.
This Agreement may be executed in one or more counterparts, each of which will be deemed an original, but all of which together
will constitute one and the same agreement. Facsimile or PDF copies of signed signature pages shall be binding originals.

 

[Signature Page Follows]

 

    	 	8	 

    	 	 	 

    

 

The parties represent
that they have read this Restricted Stock Purchase Agreement in its entirety, have had an opportunity to obtain the advice of counsel
prior to executing this Agreement and fully understand this Agreement. Purchaser agrees to notify Company of any change in his
address below.

 

	PURCHASER	 	INNOVATIVE INDUSTRIAL PROPERTIES, INC.
	 	 	 
	 	 	 
	(Signature)	 	 
	 	 	(Signature)
	 	 	 
	 	 	 
	(Print Name)	 	 
	 	 	(Print Name)
	 	 	 
	Address:	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 

 

[Signature Page to Restricted Stock Purchase
Agreement]

 

    	 	 	 

    	 	 	 

    

 

spouse consent

 

The undersigned spouse
of [       ] (the “Purchaser”) has read, understands and hereby approves
all the terms and conditions of the Restricted Stock Purchase Agreement dated June 15, 2016 (the “Agreement”),
by and between Purchaser and Innovative Industrial Properties, Inc., a Maryland corporation (the “Company”),
pursuant to which Purchaser has purchased [       ] Shares ([      
]) shares of the Company’s Class B common stock (the “Shares”).

 

In consideration of
the Company granting my spouse the right to purchase the Shares under the Agreement, I hereby agree to be irrevocably bound by
all the terms and conditions of the Agreement (including but not limited to the Company’s Repurchase Option and the Right
of First Refusal and the market standoff agreements contained therein) and further agree that any community property interest I
may have in the Shares will be similarly bound by the Agreement.

 

I hereby appoint Purchaser
as my attorney-in-fact, to act in my name, place and stead with respect to any amendment of the Agreement and with respect to the
making and filing of an election under Internal Revenue Code Section 83(b) in connection with the purchase of the Shares.

 

	Dated:	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	Signature of Spouse [Sign Here]
	 	 	 	 
	 	 	 	 
	 	 	 	Name of Spouse [Please Print]
	 	 	 	 
	 	 	 	 ̈     Check this box if you do not have a spouse

 

    	 	 	 

    	 	 	 

    

 

EXHIBIT A

 

INVESTMENT
REPRESENTATION STATEMENT

 

In connection with
the purchase of the Shares, Purchaser represents to Company as follows:

 

1.            Company
May Rely on These Representations. I understand that Company’s sale of the shares to me has not been registered
under the Securities Act of 1933, as amended (the “Securities Act"), because Company believes, relying in part
on my representations in this document, that an exemption from such registration requirement is available for such sale. I understand
that the availability of this exemption depends upon the representations I am making to Company in this document being true
and correct.

 

2.            I
am Purchasing for Investment. I am purchasing the shares solely for investment purposes, and not for further distribution.
My entire legal and beneficial ownership interest in the shares is being purchased and shall be held solely for my account, except
to the extent I intend to hold the shares jointly with my spouse. I am not a party to, and do not presently intend to
enter into, any contract or other arrangement with any other person or entity involving the resale, transfer, grant of participation
with respect to or other distribution of any of the shares. My investment intent is not limited to my present intention to hold
the shares for the minimum capital gains period specified under any applicable tax law, for a deferred sale, for a specified increase
or decrease in the market price of the shares, or for any other fixed period in the future.

 

3.            I
Can Protect My Own Interests. I can properly evaluate the merits and risks of an investment in the shares and can protect
my own interests in this regard, whether by reason of my own business and financial expertise, the business and financial expertise
of certain professional advisors unaffiliated with Company with whom I have consulted, or my preexisting business or personal
relationship with Company or any of its officers, directors or controlling persons.

 

4.            I
am Informed About Company. I am sufficiently aware of Company’s business affairs and financial condition to reach
an informed and knowledgeable decision to acquire the shares. I have had opportunity to discuss the plans, operations and
financial condition of Company with its officers, directors or controlling persons, and have received all information I deem
appropriate for assessing the risk of an investment in the shares, including a copy of the Company’s Articles of Incorporation,
which includes a forfeiture provision with respect to my Shares.

 

5.            I
Recognize My Economic Risk. I realize that the purchase of the shares involves a high degree of risk, and that Company’s
future prospects are uncertain. I am able to hold the shares indefinitely if required, and am able to bear the loss of my
entire investment in the shares.

 

    	 	A-1	 

    	 	 	 

    

 

6.            I
Know the Shares are Restricted Securities. I understand that the shares are “restricted securities” in that
Company’s sale of the shares to me has not been registered under the Securities Act in reliance upon an exemption for non-public
offerings. In this regard, I also understand and agree that:

 

(a)            I
must hold the shares indefinitely, unless any subsequent proposed resale by me is registered under the Securities Act, or unless
an exemption from registration is otherwise available (such as Rule 144);

 

(b)            Company
is under no obligation to register any subsequent proposed resale of the shares by me; and

 

(c)            the
certificate evidencing the shares will be imprinted with a legend which prohibits the transfer of the shares unless such transfer
is registered or such registration is not required in the opinion of counsel for Company.

 

7.            I
am Familiar With Rule 144. I am familiar with Rule 144 adopted under the Securities Act, which in some circumstances
permits limited public resales of “restricted securities” like the shares acquired from an issuer in a non-public offering.
I understand that my ability to sell the shares under Rule 144 in the future is uncertain, and will depend upon, among
other things: (i) the availability of certain current public information about Company; (ii) the resale occurring more
than six months after my purchase and full payment (within the meaning of Rule 144) for the shares; and (iii) if
I am an affiliate of Company,: (A) the sale being made through a broker in an unsolicited “broker’s transaction”
or in transactions directly with a market maker, or in transactions constituting “riskless principal transactions”,
as said terms are defined under the Securities Exchange Acts of 1933 and 1934, as amended, (B) the amount of shares being
sold during any three month period not exceeding the specified limitations stated in Rule 144, and (C) timely filing
of a notice of proposed sale on Form 144, if applicable.

 

8.            I
Know Rule 144 May Never be Available. I understand that the requirements of Rule 144 may never be met, and that
the shares may never be saleable. I further understand that at the time I wish to sell the shares, there may be no public
market for Company’s stock upon which to make such a sale, or the current public information requirements of Rule 144
may not be satisfied, either of which would preclude me from selling the shares under Rule 144 even if the six-month minimum
holding period had been satisfied.

 

9.            I
Know I am Subject to Further Restrictions on Resale. I understand that in the event Rule 144 is not available
to me, any future proposed sale of any of the shares by me will not be possible without prior registration under the Securities
Act, compliance with some other registration exemption (which may or may not be available), or each of the following: (i) my
written notice to Company containing detailed information regarding the proposed sale, (ii) my providing an opinion of my
counsel to the effect that such sale will not require registration, and (iii) Company notifying me in writing that its counsel
concurs in such opinion. I understand that neither Company nor its counsel is obligated to provide me with any such opinion.
I understand that although Rule 144 is not exclusive, the Staff of the SEC has stated that persons proposing to sell
private placement securities other than in a registered offering or pursuant to Rule 144 will have a substantial burden of
proof in establishing that an exemption from registration is available for such offers or sales, and that such persons and their
respective brokers who participate in such transactions do so at their own risk.

 

    	 	A-2	 

    	 	 	 

    

 

10.           I
Know I May Have Tax Liability Due to the Uncertain Value of the Shares. I understand that the Board of Directors
believes its valuation of the shares represents a fair appraisal of their worth, but that it remains possible that, with the benefit
of hindsight, the Internal Revenue Service may successfully assert that the value of the shares on the date of my purchase is substantially
greater than the Board’s appraisal. I understand that any additional value ascribed to the shares by such an IRS determination
will constitute ordinary income to me as of the purchase date, and that any additional taxes and interest due as a result will
be my sole responsibility payable only by me, and that Company need not and will not reimburse me for that tax liability. I understand
that if such additional value represents more than 25% of my gross income for the year in which the value of the shares is taxable,
the IRS will have 6 years from the due date for filing the return (or the actual filing date of the return if filed hereafter)
within which to assess me the additional tax and interest due.

 

[Signature Page Follows]

 

    	 	A-3	 

    	 	 	 

    

 

IN WITNESS WHEREOF, the undersigned has
signed this Investment Representation Statement as of the date written below.

 

	 	 
	(Signature)	 
	 	 
	 	 
	(Print Name)	 
	 	 
	 	 
	(Date)	 

 

[Signature Page to Investment
Representation Statement]

  

    	 	 	 

    	 	 	 

    

 

EXHIBIT B

 

IF
YOU WISH TO MAKE A SECTION 83(B) ELECTION, THE FILING OF SUCH ELECTION IS YOUR RESPONSIBILITY.

 

THE
FORM FOR MAKING THIS SECTION 83(b) ELECTION IS BELOW.

 

YOU
MUST FILE THIS FORM WITHIN THIRTY (30) DAYS OF PURCHASING THE SHARES.

 

YOU
(AND NOT COMPANY OR ANY OF ITS AGENTS) SHALL BE SOLELY RESPONSIBLE FOR FILING SUCH FORM WITH THE IRS, EVEN IF YOU REQUEST
COMPANY OR ITS AGENTS TO MAKE THIS FILING ON YOUR BEHALF AND EVEN IF COMPANY OR ITS AGENTS HAVE MADE THIS FILING ON YOUR BEHALF
IN THE PAST.

 

The election should
be filed by mailing a signed election form by certified mail, return receipt requested to the IRS Service Center where you file
your tax returns. See www.irs.gov.

 

    	 	B-1	 

    	 	 	 

    

 

INFORMATION
RE: FILING OF SECTION 83(b) ELECTION

 

These instructions
are provided to assist you if you choose to make an election under Section 83(b) of the Internal Revenue Code. Please consult
with your personal tax advisor as to whether an election of this nature will be in your best interests in light of your personal
tax situation.

 

The executed original
of the 83(b) election must be mailed to the Internal Revenue Service at the appropriate address as indicated below within 30
days of the Effective Date of this Agreement. PLEASE NOTE: There is no remedy for failure to mail on time. The steps
outlined below should be followed to ensure the election is mailed and filed correctly and in a timely manner.

 

1.            Complete
83(b) election form (attached below) and make four (4) copies of the signed election.

 

2.            Prepare
cover letter to the IRS (sample letter attached below).

 

3.            Send
cover letter with originally executed 83(b) form and one (1) copy via certified mail, return receipt requested to the Internal
Revenue Service at the address of the IRS where you file your personal tax returns. We suggest that you have the package date-stamped
at the post office. The post office will provide you with a white certified receipt that includes a dated postmark. Enclose a self-addressed,
stamped envelope so that the IRS may return a date-stamped copy to you. However, your postmarked receipt is your proof of having
timely filed the 83(b) if you do not receive confirmation from the IRS.

 

4.            One (1)
copy should be sent to the Company for its records and one (1) copy must be attached to your federal income tax return for
the year in which you are making the election.

 

5.            Retain
the IRS file-stamped copy (when returned) for your records.

 

Please consult your
personal tax advisor for the address of the office of the IRS to which you should mail your election.

 

    	 	 	 

    	 	 	 

    

 

ELECTION
UNDER SECTION 83(b) OF THE

INTERNAL REVENUE CODE OF 1986, AS AMENDED

 

The undersigned taxpayer
hereby elects, pursuant to Section 83(b) of the Internal Revenue Code of 1986, as amended, to include in his or her gross
income for the current taxable year, the amount of any compensation taxable to him or her in connection with his or her receipt
of the property described below:

 

1.            The
name, address, taxpayer identification number and taxable year of the undersigned are as follows:

 

	Name of Taxpayer:	 
	Taxpayer’s Address:

	 
	Taxpayer ID #:	 

 

2.            The
property with respect to which the election is made is described as follows: [Number of Shares] ([    ]) shares
(the “Shares”) of the Common Stock of Innovative Industrial Properties, Inc. (the “Company”).

 

3.            The
date on which the property was transferred is: June 15, 2016.

 

4.            The
property is subject to the following restrictions: The Shares may be repurchased by Company, or its assignee, upon the occurrence
of certain events. This right lapses with regard to a portion of the Shares over time.

 

5.            The
fair market value at the time of transfer, determined without regard to any restriction other than a restriction which by its terms
will never lapse, of such property is: [   ] Dollars ($[   ]). The amount, if any, paid for such
property: [   ] Dollars ($[   ]).

 

The undersigned has
submitted a copy of this statement to the person for whom the services were performed in connection with the undersigned’s
receipt of the above-described property. The transferee of such property is the person performing the services in connection with
the transfer of said property.

 

The undersigned understand(s)
that the foregoing election may not be revoked except with the consent of the Commissioner.

 

	Dated:	 	 	 
	 	 	 	[Purchaser Name] (Taxpayer)

 

    	 	 	 

    	 	 	 

    

 

[Date]

 

VIA CERTIFIED MAIL

RETURN RECEIPT REQUESTED

 

	Internal Revenue Service	 
	 	 
	 	 
	[IRS location address]	 

 

	Re:	Taxpayer:	[Purchaser Name]
	 	 	Social Security Number: [         ]
	 	 	Filing of Election under Section 83(b)

 

Ladies and Gentlemen:

 

Enclosed please find
an original and one copy of an Election Under Section 83(b) of the Internal Revenue Code of 1986, as amended, which is being
filed on behalf of the taxpayer referenced above. Please acknowledge receipt of the enclosed materials by stamping the enclosed
copy of the 83(b) Election and returning it to me in the self-addressed stamped envelope provided herewith.

 

	 	Very truly yours,
	 	 
	 	[Purchaser Name]

 

Enclosures

		cc:	[Company Name]

[Company Address]

 

    	 	 	 

    	 	 	 

    

 

EXHIBIT c

 

STOCK POWER
AND ASSIGNMENT

 

SEPARATE
FROM STOCK CERTIFICATE

 

    	 	 	 

    	 	 	 

    

 

STOCK POWER
AND ASSIGNMENT

 

SEPARATE
FROM stock CERTIFICATE

 

FOR
VALUE RECEIVED and pursuant to that certain Restricted Stock Purchase Agreement dated as of June 15, 2016 (the
“Agreement”), the undersigned hereby sells, assigns and transfers unto ______________________________,
__________ shares of the Class B Common Stock, $.001 par value, of Innovative Industrial Properties,
Inc., a Maryland corporation (the “Company”), standing in the undersigned’s name on the books of
the Company represented by Certificate No(s). ____ delivered herewith, and does hereby irrevocably constitute and appoint the Secretary
of the Company as the undersigned’s attorney-in-fact, with full power of substitution, to transfer said stock on the books
of the Company. THIS ASSIGNMENT MAY ONLY BE USED AS AUTHORIZED BY THE AGREEMENT AND ANY EXHIBITS THERETO.

 

	Dated: 	 	 	 
	 	 	 	 
	 	 	 	PURCHASER
	 	 	 	 
	 	 	 	 
	 	 	 	(Signature)
	 	 	 	 
	 	 	 	 
	 	 	 	(Please Print Name)
	 	 	 	 
	 	 	 	 
	 	 	 	(Spouse’s Signature, if any)
	 	 	 	 
	 	 	 	 
	 	 	 	(Please Print Spouse’s Name)

 

Instructions to Purchaser:
Please do not fill in any blanks other than the signature line. The purpose of this Stock Power and Assignment is to enable
the Company and/or its assignee(s) to acquire the shares upon exercise of its “Repurchase Option” and/or “Right
of First Refusal” set forth in the Agreement without requiring additional signatures on the part of Purchaser or Purchaser’s
Spouse, if any.Exhibit
10.4

 

SEVERANCE
AND CHANGE OF CONTROL AGREEMENT

 

THIS AGREEMENT, effective
as of the _____ day of _______________, 2016, is by and between Innovative Industrial Properties, Inc., a Maryland corporation
(the “Company”), IIP Operating Partnership, LP, a Delaware limited partnership (the “Partnership”),
and Alan D. Gold (the “Employee”).

 

WHEREAS, to induce the
Employee to remain as an executive officer of the Company and a key employee of the Partnership, the Company, the Partnership and
the Employee desire to enter into this Severance and Change Of Control Agreement (the “Agreement”); and

 

WHEREAS, the parties agree
that the restrictive covenants underlying certain of the Employee’s obligations under this Agreement are necessary to protect
the goodwill or other business interests of the Innovative Industrial Entities (as defined below) and that such restrictive covenants
do not impose a greater restraint than is necessary to protect such goodwill or other business interests.

 

NOW, THEREFORE, in consideration
of the premises and other good and valuable consideration, including the Employee’s agreement to continue as an executive
officer of the Company and as an employee of the Partnership, the Employee’s agreement to provide consulting services following
termination of employment pursuant to the terms hereof, and the restrictive covenants contained herein, the Employee, the Company,
and the Partnership agree as follows:

 

1.          Definitions.
The following words, when capitalized in this Agreement, shall have the meanings ascribed below and shall supersede the meanings
given to any such terms in any other award agreement or related plan document in effect prior to the date of this Agreement, including
but not limited to the definitions of “Cause,” “Change of Control,” or “Good Reason”:

 

(a)          “Affiliate”
shall have the meaning given to such term in Rule 12b-2 of the General Rules and Regulations of the Exchange Act.

 

(b)          “Average
Annual Cash Bonus” means the average of the annual cash bonus, if any, paid or payable to the Employee with respect to
the three (3) most recently completed calendar years prior to termination of employment (or the period of the Employee’s
employment, if shorter).

 

(c)          “Base
Performance Share Value” means the fair market value as of the date of the Change of Control of the number of unvested
shares underlying the Employee’s outstanding performance share awards that would have been earned pursuant to the terms of
the award if the performance period for each such award ended immediately prior to the Change of Control. For such purposes, the
level of achievement of the performance goals established for each such award will be determined on the date immediately prior
to the Change of Control as follows: (X) if the goal is a market-based goal, such as total stockholder return or stock price, then
the actual performance to date shall be used, and (Y) if the goal is not a market-based goal, then the annualized forecasted number
for such goal as most recently prepared by the Company prior to the date of the Change of Control shall be used and treated as
if it were actual performance.

 

     

     

    

 

(d)          “Base
Restricted Share Value” means the fair market value as of the date of the Change of Control of the shares underlying
all of the Employee’s unvested time-vesting restricted stock awards, restricted stock units or stock rights awards outstanding
immediately prior to the Change of Control.

 

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

 

(f)          “Cause”
means the termination of the Employee’s employment with all Innovative Industrial Entities by action of the Board or its
delegate for one or more of the following reasons:

 

(i)          The
Employee’s willful and continued failure substantially to perform his duties with the Innovative Industrial Entities (other
than any such failure resulting from the Employee’s incapacity due to physical or mental illness), after a written demand
for substantial performance is delivered to the Employee by the Board, which demand specifically identifies the manner in which
the Board believes that the Employee has not substantially performed his duties;

 

(ii)         The
Employee’s willful commission of an act of fraud or dishonesty resulting in economic or financial damage to the Innovative
Industrial Entities;

 

(iii)        The
Employee’s conviction of, or entry by the Employee of a guilty or no contest plea to, the commission of a felony or a crime
involving moral turpitude;

 

(iv)        A
willful breach by the Employee of his fiduciary duty to the Company which results in economic or other damage to the Innovative
Industrial Entities; or

 

(v)         The
Employee’s willful and material breach of the Employee’s covenants set forth in this Section 16 of this Agreement.

 

(g)          “Change
of Control” means the occurrence of an event or series of events which qualify as a change in control event for purposes
of Code Section 409A and Treasury Regulation §1.409A-3(i)(5), including:

 

(i)          A
change in the ownership of the Company, which shall occur on the date that any one Person, or more than one Person Acting as a
Group (as defined below), other than Excluded Person(s) (as defined below), acquires ownership of the stock of the Company that,
together with the stock then held by such Person or group, constitutes more than fifty percent (50%) of the total fair market value
of the stock of the Company. However, if any one Person or more than one Person Acting as a Group is considered to own more than
fifty (50%) of the total fair market value of the stock of the Company, the acquisition of additional stock by the same Person
or Persons is not considered to cause a Change of Control.

 

    	 	2	 

     

    

 

(ii)         A
change in the effective control of the Company, which shall occur on the date that:

 

(1)         Any
one Person, or more than one Person Acting as a Group, other than Excluded Person(s), acquires (or has acquired during the twelve
(12) month period ending on the date of the most recent acquisition by such Person or Persons) ownership of stock of the Company
possessing thirty percent (30%) or more of the total voting power of the stock of the Company. However, if any one Person or more
than one Person Acting as a Group is considered to own more than thirty percent (30%) of the total voting power of the stock of
the Company, the acquisition of additional voting stock by the same Person or Persons is not considered to cause a Change of Control;
or

 

(2)         A
majority of the members of the Board is replaced during any twelve (12) month period by directors whose appointment or election
is not endorsed by a majority of the members of the Board prior to the date of the appointment or election.

 

(iii)        A
change in the ownership of a substantial portion of the Company’s assets, which shall occur on the date that any one Person,
or more than one Person Acting as a Group, other than Excluded Person(s), acquires (or has acquired during the twelve (12) month
period ending on the date of the most recent acquisition by such Person or Persons) assets from the Company that have a total Gross
Fair Market Value (as defined below) equal to more than fifty percent (50%) of the total Gross Fair Market Value of all the assets
of the Company immediately prior to such acquisition or acquisitions, other than an Excluded Transaction (as defined below).

 

For purposes of this Subsection
(g):

 

“Gross Fair Market
Value” means the value of the assets of the Company, or the value of the assets being disposed of, as applicable, determined
without regard to any liabilities associated with such assets.

 

Persons will not be considered
to be “Acting as a Group” solely because they purchase or own stock of the Company at the same time, or as a
result of the same public offering, or solely because they purchase assets of the Company at the same time, or as a result of the
same public offering, as the case may be. However, Persons will be considered to be Acting as a Group if they (i) are owners of
an entity that enters into a merger, consolidation, purchase or acquisition of assets, or similar business transaction with the
Company, or (ii) do so within the meaning of Section 13(d) of the Exchange Act, including any group acting for the purpose of acquiring,
holding or disposing of securities (within the meaning of Rule 13d-5(b)(1) under the Exchange Act).

 

    	 	3	 

     

    

 

The term “Excluded
Transaction” means any transaction in which assets are transferred to: (A) a stockholder of the Company (determined immediately
before the asset transfer) in exchange for or with respect to its stock; (B) an entity, fifty percent (50%) or more of the total
value or voting power of which is owned, directly or indirectly, by the Company (determined after the asset transfer); (C) a Person,
or more than one Person Acting as a Group, that owns, directly or indirectly, fifty percent (50%) or more of the total value or
voting power of all the outstanding stock of the Company (determined after the asset transfer); or (D) an entity at least fifty
percent (50%) of the total value or voting power of which is owned, directly or indirectly, by a Person described in clause (C)
(determined after the asset transfer).

 

The term “Excluded
Person(s)” means (A) the Company or any Innovative Industrial Entity; (B) a trustee or other fiduciary holding securities
under an employee benefit plan of the Company or any Innovative Industrial Entity; (C) an underwriter temporarily holding securities
pursuant to an offering of such securities; or (D) a corporation owned, directly or indirectly, by the stockholders of the Company
in substantially the same proportions as their ownership of stock in the Company.

 

The term “Change
of Control” as defined above shall be construed in accordance with Code Section 409A and the regulations promulgated
thereunder. In no event shall a transaction described above constitute a “Change of Control” for purposes of this Agreement
unless such transaction also satisfies the requirement to be a change in the ownership or effective control of a corporation, or
a change in the ownership of a substantial portion of the assets of a corporation, as each of those terms are defined under Code
Section 409A and the regulations promulgated thereunder.

 

(h)          “Code”
means the Internal Revenue Code of 1986, as amended.

 

(i)          “Exchange
Act” means the Securities Exchange Act of 1934, as amended.

 

(j)          “General
Release” means (i) a release of the Innovative Industrial Entities, in such form as the Partnership may reasonably request,
of all claims against the Innovative Industrial Entities relating to the Employee’s employment and termination thereof, and
(ii) an agreement to continue to comply with, and be bound by, the provisions of Section 16 hereof.

 

(k)          “Good
Reason” means any one or more of the following conditions:

 

(i)          any
material diminution of the Employee’s authority, duties or responsibilities;

 

(ii)         a material diminution of the Employee’s annual base salary;

 

(iii)        a
material change in the geographic location at which the Employee must perform the Employee’s duties and responsibilities;
or

 

(iv)        any
other action or inaction by the Company or the Partnership that constitutes a material breach of this Agreement or any other agreement
pursuant to which the Employee provides services to the Company or the Partnership.

 

    	 	4	 

     

    

 

A termination of the Employee’s
employment for Good Reason shall be effective only if (X) such condition was not consented to by the Employee in advance or subsequently
ratified by the Employee in writing, (Y) such condition remains in effect thirty (30) days after the Employee gives written notice
to the Board of the Employee’s intention to terminate his employment for Good Reason, which notice specifically identifies
such condition, and (Z) the Employee gives the notice referred to in (Y) above within ninety (90) days of the initial existence
of such condition. If the Company or the Partnership, as applicable, does not cure the condition within the thirty (30) day cure
period described in (Y) above, then the Employee’s termination will occur on the day immediately following the end of the
cure period. If the Company or the Partnership, as applicable, cures the condition within such thirty (30) day cure period, then
the Employee will be deemed to have withdrawn his notice of termination effective as of the date the cure is effected.

 

(l)          “Innovative
Industrial Entity” or “Innovative Industrial Entities” means the Company, the Partnership, any of
their Affiliates, and any other entities that along with the Company or the Partnership is considered a single employer pursuant
to Code Section 414(b) or (c) and the Treasury regulations promulgated thereunder, determined by applying the phrase “at
least 50 percent” in place of the phrase “at least 80 percent” each place it appears in such Treasury regulations
or Code Section 1563(a).

 

(m)          “Medical
Benefits” shall mean the monthly fair market value of benefits provided to the Employee and the Employee’s dependents
under the major medical, dental and vision benefit plans sponsored and maintained by the Partnership, at the level of coverage
in effect for such persons immediately prior to the Employee’s termination of employment date. The “monthly fair market
value” of such benefits shall be equal to the monthly cost (including any applicable administrative fee) to the Employee
as if the Employee elected COBRA continuation coverage at the level of coverage in effect at such time for the Employee and the
Employee’s dependents at their own expense.

 

(n)          “Person”
means a “person” as used in Sections 3(a)(9) and 13(d) of the Exchange Act or any group of Persons acting in concert
that would be considered “persons acting as a group” within the meaning of Treasury Regulation §1.409A-3(i)(5).

 

(o)          “Prime
Rate” means an annual rate, compounding annually, equal to the prime rate, as reported in The Wall Street Journal on
the date of the Change of Control, or if not reported on that date, the last preceding date on which so reported, which rate shall
be adjusted on each January 1 to the prime rate then in effect and shall remain in effect for the year.

 

(p)          “Qualifying
Retirement” means the Employee’s voluntary termination of employment after the Employee has (i) attained (X) age
sixty-five (65), (Y) age fifty-five (55) with ten (10) Years of Service as a full-time employee of the Partnership or any of its
Affiliates, or (Z) an age which, when added to such Years of Service of the Employee equals at least seventy-five (75), and (ii)
previously delivered a written notice of retirement to the Partnership and on the date of retirement the Employee has satisfied
the minimum applicable advance written notice requirement set forth below:

    	 	5	 

     

    

 

	Age at

Voluntary Termination	 	Number of Years of

Advance Notice
	58 or younger

59

60 or older	 	3 years

2 years

1 year

 

By way of illustration, and
without limiting the foregoing, if (i) the Employee is eligible to retire at age fifty-nine (59) after ten (10) Years of Service,
(ii) the Employee gives two (2) years notice at age fifty-eight (58) that the Employee intends to retire at age sixty (60), and
(iii) the Employee later terminates employment at age fifty-nine (59), then the Employee’s retirement at age fifty-nine (59)
would not constitute a Qualifying Retirement. However, if (i) the Employee is eligible to retire at age fifty-nine (59) after ten
(10) Years of Service, (ii) the Employee gives two (2) years notice at age fifty-eight (58) that the Employee intends to retire
at age sixty (60), and (iii) the Employee terminates employment upon reaching age sixty (60), then the Employee’s retirement
at age sixty (60) would constitute a Qualifying Retirement.

 

(q)          
“Separation from Service” means the termination of the Employee’s employment with all Innovative Industrial
Entities, provided that, notwithstanding such termination of the employment relationship between the Employee and all Innovative
Industrial Entities, the Employee shall not be deemed to have had a Separation from Service where it is reasonably anticipated
that the level of bona fide services that the Employee will perform (whether as an employee or independent contractor) following
such termination from the Partnership and all Innovative Industrial Entities would be twenty percent (20%) or more of the average
level of bona fide services performed by the Employee (whether as an employee or independent contractor) for the Innovative Industrial
Entities over the immediately preceding thirty-six (36) month period (or such lesser period of actual service). In such event,
Separation from Service shall mean the permanent reduction of the level of bona fide services to be performed by the Employee (whether
as an employee or independent contractor) to a level that is less than twenty percent (20%) of the average level of bona fide services
performed by the Employee (whether as an employee or independent contractor) during the thirty-six (36) month period (or such lesser
period of actual service) immediately prior to the termination of the Employee’s employment relationship. A Separation from
Service shall not be deemed to have occurred if the Employee is absent from active employment due to military leave, sick leave,
or other bona fide leave of absence if the period of such leave does not exceed the greater of (i) six (6) months or (ii) the period
during which the Employee’s right to reemployment by any Innovative Industrial Entity is provided either by statute or contract.

 

(r)          “Specified
Employee” means an employee of any Innovative Industrial Entity who is a “specified employee” as defined
in Code Section 409A(a)(2)(b)(i) and Treasury Regulation §1.409A-1(i). If the Employee is a key employee as of the applicable
identification date, the Employee shall be treated as a Specified Employee for the twelve (12) month period beginning on the first
day of the fourth month following such identification date. The applicable identification date for purposes of this Agreement shall
be September 30 of each year.

 

(s)          “Unvested
Equity Award” has the meaning given to such term in Section 6(a).

 

    	 	6	 

     

    

 

(t)          “Years
of Service” means the Employee’s total complete years of employment with an Innovative Industrial Entity, including
years of employment with an entity that is acquired by an Innovative Industrial Entity prior to such acquisition. For this purpose,
a “complete year of employment” shall begin on the Employee’s date of hire and end on each subsequent anniversary
of such date.

 

2.          Term
of the Agreement. The term of this Agreement shall begin on the date hereof and end at 11:59 p.m. on December 31, 2019 and
thereafter shall automatically renew for successive three (3) year terms unless either party delivers written notice of non-renewal
to the other party at least ninety (90) days prior to the end of the then current term; provided, however, that if a Change of
Control has occurred during the original or any extended term (including any extension resulting from a prior Change of Control),
the term of the Agreement shall end no earlier than twenty-four (24) calendar months after the end of the calendar month in which
the Change of Control occurs.

 

3.          No
Change of Control – Severance. Except in circumstances in which the Employee would be entitled to payments and benefits
in connection with a Change of Control as provided in Section 4 below, in the event that during the term of this Agreement the
Employee has a Separation from Service as a result of the Innovative Industrial Entities terminating the Employee’s employment
without Cause or the Employee terminating the Employee’s employment for Good Reason, subject to Sections 11, 15 and 16 below:

 

(a)          The
Partnership shall pay to the Employee an amount equal to (i) 3.0 times the sum of (A) the Employee’s annual base salary in
effect on the date the Employee’s employment terminates, plus (B) the Employee’s Average Annual Cash Bonus, plus (ii)
eighteen (18) months of the Employee’s Medical Benefits. Payment shall be made in a lump sum on the first business day after
sixty (60) days following the Employee’s Separation from Service;

 

(b)          All
of the Employee’s outstanding unvested stock options, restricted stock awards, restricted stock units and stock rights awards
that vest solely on the basis of time shall become vested on a pro-rated basis, based on the portion of the vesting period that
has elapsed as of the date of the Employee’s Separation from Service; and

 

(c)          All
of the Employee’s outstanding performance share awards shall be earned as of the date of Separation from Service based on
the level of achievement of the performance goals established for such awards as of such date, but then pro-rated based on the
portion of the performance period that has elapsed as of the date of the Employee’s Separation from Service. For purposes
hereof, the level of achievement of the performance goals established for each such award will be determined on the date immediately
prior to the Separation from Service as follows: (i) if the goal is a market-based goal, such as total stockholder return or stock
price, then the actual performance to date shall be used, and (ii) if the goal is not a market-based goal, then the level of achievement
of such goal shall be (X) based on the most recently reported number(s) by the Company in its reports filed with the Securities
and Exchange Commission or (Y) if such numbers are not so filed, based on the numbers as prepared internally by the Company for
the quarter ending prior to the date of the Separation from Service.

 

    	 	7	 

     

    

 

Any shares issuable under
awards that vest or are earned pursuant to subsections (b) and (c) shall be issued on the same date as the cash severance payment
is made pursuant to subsection (a).

 

4.          Change
of Control – Severance. In the event that during the term of this Agreement the Innovative Industrial Entities terminate
the Employee’s employment without Cause or the Employee terminates the Employee’s employment for Good Reason, in each
case within two (2) years following a Change of Control, the following provisions shall apply:

 

(a)          The
Partnership shall pay to the Employee the amount set forth in Section 3(a);

 

(b)          All
outstanding unvested stock options, restricted stock, restricted stock units, stock rights awards and performance share awards
then held by the Employee will vest (at the greater of actual performance to-date or target, for any awards subject to performance
goals), and all outstanding equity awards that have not vested at the time of the Change of Control or been converted to the right
to receive a cash payment pursuant to Section 6(c) will vest on the date the General Release in Section 15 becomes effective, and,
if applicable, will be paid on the tenth (10th) business day following such time. Notwithstanding the foregoing, all such awards
which are subject to Code Section 409A will be paid on the first (1st) business day after sixty (60) days following the Employee’s
Separation from Service, provided the General Release in Section 15 has become effective; and

 

(c)          With
respect to those Unvested Equity Awards that have been exchanged pursuant to Sections 6(b) and 6(c) for the right to receive a
contingent cash payment, subject to Section 11 below, the Employee shall receive a cash payment made in a lump sum on the first
business day after sixty (60) days following the Employee’s Separation from Service equal to any portion of the unpaid Base
Performance Share Value and Base Restricted Share Value that has not been paid pursuant to Sections 6(b) and 6(c), together with
accrued but unpaid interest at the Prime Rate on such unpaid amount from the date of the Change of Control to the date of payment.

 

5.          Entitlement
to Severance.

 

(a)          If
the Employee becomes entitled to receive any severance payments or benefits described in Section 3 or Section 4 after the Employee
has delivered written notice of what would otherwise have been a Qualifying Retirement to the Partnership had the Employee continued
to be employed by the Partnership through the date of retirement set forth in the notice, then the amount of such payments and
benefits shall be limited to (i) those that the Employee would have otherwise received had such employment continued through such
date of retirement, and (ii) those provided by Section 9, if any.

 

(b)          If
the Employee dies after receiving notice from the Company that the Employee is being terminated without Cause, or after providing
notice of termination for Good Reason, but prior to the date the Employee receives the payments and benefits described in Section
3 or Section 4, as the case may be, then the Employee’s estate, heirs and beneficiaries shall be entitled to the payments
and benefits described in Section 3 or Section 4, as the case may be, at the same time such payments and benefits would have been
paid or provided to the Employee had the Employee lived.

 

    	 	8	 

     

    

 

6.          Change
of Control – Effect on Stock Rights.

 

(a)          Except
as otherwise provided in Sections 6(b) and 6(c) below (or in Sections 4(b) or 4(c), if applicable), the occurrence of a Change
of Control shall not impact any existing unvested stock options, restricted stock awards, restricted stock units, stock rights
awards or performance share awards (collectively, “Unvested Equity Awards”) unless such rights are cashed out
pursuant to the terms of the applicable merger agreement or other agreement(s) pursuant to which such Change of Control is effected.

 

(b)          With
respect to Unvested Equity Awards that are performance share awards (“Performance Awards”), notwithstanding
anything to the contrary contained in the related plan or award agreement, all of the Employee’s outstanding unvested Performance
Awards shall be cancelled and, in consideration for the cancellation of such awards, the Employee shall receive a deferred contingent
cash payment with respect to each such cancelled award equal to (X) the Base Performance Share Value determined for such cancelled
award, plus (Y) interest on such unpaid Base Performance Share Value from the date of the Change of Control to the date of payment
at the Prime Rate, such cash payment to be made on the last day of the applicable performance period for such award, provided that
the Employee remains employed by the Partnership, an Affiliate, or one of their successors through the last day of the applicable
performance period.

 

(c)          With
respect to Unvested Equity Awards that are not Performance Awards, if the stock underlying such awards is not readily tradable
on an established securities market immediately after the Change of Control (after giving effect to any conversion, exchange or
replacement pursuant to the applicable plan or award agreement of the stock underlying Unvested Equity Awards as a result of a
reorganization, merger, consolidation, combination or other similar corporate transaction or event), then notwithstanding anything
to the contrary contained in the related plan or award agreement, all of the Employee’s outstanding Unvested Equity Awards
shall be cancelled and, in consideration for the cancellation of such awards, the Employee shall receive:

 

(i)          a
cash payment equal to (X) the fair market value of the shares underlying all of the Employee’s unvested stock options as
of the date of the Change of Control, less (Y) the aggregate exercise price of such stock options, such cash payment to be made
within thirty (30) days after the Change of Control; and

 

(ii)         a
deferred contingent cash payment equal to (X) the Base Restricted Share Value, plus (Y) interest on the unpaid Base Restricted
Share Value from the date of the Change of Control to the date of payment at the Prime Rate, such cash payment of the Base Restricted
Share Value to be made in installments on the applicable vesting dates with respect to the number of shares that would have been
issued on that vesting date, plus all accrued but unpaid interest on the unpaid Base Restricted Share Value through such vesting
date, provided that the Employee remains employed by the Partnership, an Affiliate, or one of their successors through the applicable
date of vesting.

 

    	 	9	 

     

    

 

7.          Change
of Control – Excise Tax.

 

(a)          If
in the opinion of Tax Counsel (as defined in Section 7(b)) the Employee will be subject to an excise tax under Code Section 4999
with respect to all or any portion of the payments and benefits to be made by the Company or any of its Affiliates to the Employee,
whether upon a Change of Control or following a termination of the Employee’s employment, under this Agreement or otherwise
(in the aggregate, “Total Payments”), then such parties agree that the Total Payments shall either be (i) delivered
in full, or (ii) reduced to three (3) times the Employee’s “base amount” for purposes of Code Section 280G, less
$1.00 (“Scaled Back Amount”), whichever of the foregoing results in the receipt by the Employee of the greatest
benefit on an after-tax basis (taking into account the applicable federal, state and local income taxes and the excise tax). If
the Employee is entitled to the Scaled Back Amount, then such payments and benefits shall be reduced or eliminated by applying
the following principles, in order: (1) the payment or benefit with the higher ratio of the parachute payment value to present
economic value (determined using reasonable actuarial assumptions) shall be reduced or eliminated before a payment or benefit with
a lower ratio; (2) the payment or benefit with the later possible payment date shall be reduced or eliminated before a payment
or benefit with an earlier payment date; and (3) cash payments shall be reduced prior to non-cash benefits; provided that if the
foregoing order of reduction or elimination would violate Code Section 409A, then the reduction shall be made pro rata among the
payments or benefits to be received by the Employee (on the basis of the relative present value of the parachute payments).

 

(b)          For
purposes of this Section 7, within forty (40) days after delivery of a written notice of termination by the Employee or by the
Company pursuant to this Agreement within two (2) years of a Change of Control with respect to the Company (or, if an event other
than termination of employment results in payment of parachute payments under Code Section 280G and it is reasonably possible that
such parachute payments could result in an excise tax, within forty (40) days after such other event), the Company shall obtain,
at its expense, the opinion (which need not be unqualified) of nationally recognized tax counsel (“Tax Counsel”)
selected by the Compensation Committee of the Board, which sets forth (i) the “base amount” within the meaning of Code
Section 280G; (ii) the aggregate present value of the payments in the nature of compensation to the Employee as prescribed in Code
Section 280G(b)(2)(A)(ii); (iii) the amount and present value of any “excess parachute payment” within the meaning
of Code Section 280G(b)(1); and (iv) as applicable, (X) the net after-tax proceeds to the Employee, taking into account the tax
imposed by Code Section 4999 if the Total Payments were delivered in full, and (Y) the amount and nature of the parachute payments
to be reduced or forfeited according to Section 7(a) in order for the total payments and benefits to equal the Scaled Back Amount.
For purposes of such opinion, the value of any non-cash benefits or any deferred payment or benefit shall be determined by the
Company’s independent auditors in accordance with the principles of Code Section 280G and regulations thereunder, which determination
shall be evidenced in a certificate of such auditors addressed to the Company and the Employee. Such opinion shall be addressed
to the Company and the Employee and shall be binding upon the Company, its Affiliates, and the Employee.

 

    	 	10	 

     

    

 

8.          Plan
of Liquidation. If the stockholders of the Company approve a complete plan of liquidation or dissolution of the Company (“Approved
Liquidation Plan”), all Unvested Equity Awards that are not Performance Awards will fully vest on the date of such approval
and all such awards that are Performance Awards shall vest to the extent the performance goals established under such awards have
been achieved on such date (as if the Employee had satisfied all employment conditions required to vest), with the corresponding
performance period for such award(s) deemed completed as of the date immediately preceding the date of such approval. Shares of
common stock that so vest will be deemed outstanding as of the close of business on the date of such approval, and certificates
representing such shares shall be delivered to the Employee as promptly as practicable thereafter. Any Performance Awards not vesting
on the date of such approval shall be immediately cancelled without consideration therefor. In addition, unless the Approved Liquidation
Plan shall have been rescinded, if the Partnership terminates the Employee’s employment without Cause or the Employee terminates
the Employee’s employment for Good Reason in each case following stockholder approval of the Approved Liquidation Plan, then
the Employee shall receive the benefits provided in Sections 4(a), 4(b) and 4(c), as applicable.

 

9.          Retirement
and Performance Shares. If the Employee’s termination of employment constitutes a Qualifying Retirement, then the Employee’s
unvested stock options, restricted stock, restricted stock units and stock rights awards (other than performance shares) will vest
on the date of retirement set forth in the notice thereof, and if the Qualifying Retirement occurs on or after a Change of Control,
then the provision of Section 4(c) shall also apply. Notwithstanding anything to the contrary in any related plan or award agreement,
the Employee shall be entitled to exercise all vested stock options until the earlier of (a) three (3) years after the date of
Qualifying Retirement, and (b) the original terms of the options. Unless an award agreement provides for more favorable treatment,
upon a Qualifying Retirement, the Employee shall continue to have the right to earn unvested performance shares upon the achievement
of the applicable performance goals over any remaining performance period, as if the Employee’s employment had not been terminated.

 

10.         Death
and Disability. In no event shall a termination of the Employee’s employment due to death or Disability constitute a
termination by the Partnership without Cause or a termination by the Employee for Good Reason; however, upon termination of employment
due to the Employee’s death or Disability, the Employee’s estate or the Employee, as applicable, shall receive the
benefits provided in Section 4(b) or 4(c) with respect to unvested stock options, restricted stock, restricted stock units and
stock rights awards (other than performance shares), and the Employee’s estate or the Employee, as applicable, shall continue
to have the right to earn unvested performance shares upon the achievement of the applicable performance goals over any remaining
performance period, as if the Employee’s employment had not been terminated. Notwithstanding anything to the contrary in
any related plan or award agreement, (a) the Employee’s estate shall be entitled to exercise all vested stock options until
the earlier of (i) three (3) years after termination of employment due to death, and (ii) the original term of the option, and
(b) the Employee shall be entitled to exercise all vested stock options until the earlier of (i) one (1) year after termination
of employment due to Disability, and (ii) the original term of the option. For purposes of this Agreement, “Disability”
shall mean the absence of the Employee from the Employee’s duties with the Innovative
Industrial Entities on a full-time basis for ninety (90) consecutive days or on a total of one hundred eighty (180) days
in any twelve (12) month period, in either case as a result of incapacity due to mental or physical illness which is determined
to be total and permanent by a physician selected by the Company and reasonably acceptable to the Employee or the Employee’s
legal representative.

 

    	 	11	 

     

    

 

11.         Payments
to Specified Employees. Notwithstanding any other Section of this Agreement, if the Employee is a Specified Employee at the
time of the Employee’s Separation from Service, payments or distribution of property to the Employee provided under this
Agreement, to the extent considered amounts deferred under a non-qualified deferred compensation plan (as defined in Code Section
409A) shall be deferred until the six (6) month anniversary of such Separation from Service to the extent required in order to
comply with Code Section 409A and Treasury Regulation 1.409A-3(i)(2).

 

12.         Reductions
in Base Salary. For purposes of this Agreement, in the event there is a reduction in the Employee’s base salary that
would constitute the basis for a termination for Good Reason, the base salary used for purposes of calculating the severance payable
pursuant to Sections 3 or 4(a), as the case may be, shall be the amounts in effect immediately prior to such reduction.

 

13.         Other
Payments and Benefits. On any termination of employment, including, without limitation, termination due to the Employee’s
death or Disability (as defined in Section 10) or for Cause, the Employee shall receive any accrued but unpaid salary, reimbursement
of any business or other expenses incurred prior to termination of employment but for which the Employee had not received reimbursement
(provided that such expenses have been previously approved in writing or comply with the terms of any expense reimbursement policy
then in effect), and any other rights, compensation and/or benefits as may be due the Employee in accordance with the terms and
provisions of any agreements, plans or programs of the Company or the Partnership (but in no event shall the Employee be entitled
to duplicative rights, compensation and/or benefits).

 

14.         Set
Off; Mitigation. The obligation of the Company or the Partnership to pay or provide the Employee the amounts or benefits under
this Agreement shall be subject to set-off, counterclaim or recoupment of amounts owed by the Employee to the Company or the Partnership.
In addition, except as provided in Section 7 with respect to the Scaled Back Amount, if applicable, the Employee shall not be required
to mitigate the amount of any payments or benefits provided to the Employee hereunder by securing other employment or otherwise,
nor will such payments and/or benefits be reduced by reason of the Employee securing other employment or for any other reason.

 

15.         Release.
Notwithstanding any provision herein to the contrary, none of the Innovative Industrial Entities shall have any obligation to pay
any amount or provide any benefit (other than those amounts set forth in Section 13), as the case may be, under this Agreement,
unless the Employee executes, delivers to the Partnership, and does not revoke (to the extent the Employee is allowed to do so
as set forth in the General Release), a General Release within sixty (60) days of the Employee’s termination of employment.

 

    	 	12	 

     

    

 

16.         Restrictive
Covenants and Consulting Arrangement.

 

(a)          The
Employee will hold in a fiduciary capacity all secret or confidential information, knowledge or data relating to any Innovative
Industrial Entity, and each of their respective businesses (the “Confidential Information”), except in furtherance
of the business of the Innovative Industrial Entities or except as may be required by law. Additionally, and without limiting the
foregoing, the Employee agrees not to participate in or facilitate the dissemination to the media or any other third party (i)
of the Confidential Information, or (ii) of any damaging or defamatory information concerning any Innovative Industrial Entity
or the Employee’s experiences as an employee of any Innovative Industrial Entity, without the Company’s prior written
consent, except as may be required by law. Notwithstanding the foregoing, this Section 16(a) does not apply to information which
is already in the public domain other than pursuant to acts of the Employee or representatives of the Employee in violation of
this Agreement.

 

(b)          During
the Employee’s employment and during the one (1) year period after the date that the Employee ceases to be employed by any
of the Innovative Industrial Entities for any reason (the “Termination Date”), the Employee agrees that the
Employee shall not directly or knowingly and intentionally through another party recruit, induce, solicit or assist any other Person
in recruiting, inducing or soliciting (A) any other employee of any Innovative Industrial Entity to leave such employment or (B)
any other Person with which any Innovative Industrial Entity was actively conducting negotiations for employment on the Termination
Date.

 

(c)          For
a six (6) month period following any termination of employment, the Employee agrees to make himself available and, upon and as
requested by the Company or the Partnership from time to time, to provide consulting services with respect to any projects the
Employee was involved in prior to such termination and/or to provide such other consulting services as the Company or the Partnership
may reasonably request. The Employee will be reimbursed for reasonable travel and miscellaneous expenses incurred in connection
with the provision of requested consulting services hereunder. The Company or the Partnership will provide the Employee reasonable
advance notice of any request to provide consulting services, and will make all reasonable accommodations necessary to prevent
the Employee’s commitment hereunder from materially interfering with the Employee’s employment obligations, if any.
In no event will the Employee be required to provide more than twenty (20) hours of consulting services in any one month to the
Company and the Partnership pursuant to this provision.

 

(d)          The
parties agree that any breach of this Section 16 will result in irreparable harm to the non-breaching party which cannot be fully
compensated by monetary damages and accordingly, in the event of any breach or threatened breach of this Section 16, the non-breaching
party shall be entitled to injunctive relief. Should any provision of this Section 16 be determined by a court of law or equity
to be unreasonable or unenforceable, the parties agree that to the extent it is valid and enforceable, they shall be bound by the
same, the intention of the parties being that the parties be given the broadest protection allowed by law or equity with respect
to such provision.

 

17.         Survival.
The provisions of Sections 3 through 22 shall survive the termination of this Agreement to the extent necessary to enforce the
rights and obligations described therein.

 

    	 	13	 

     

    

 

18.         Compliance
with Code Section 409A. For purposes of applying the provisions of Code Section 409A to this Agreement, each separately identified
amount to which the Employee is entitled under this Agreement shall be treated as a separate payment. In addition, to the extent
permissible under Code Section 409A, any series of installment payments under this Agreement shall be treated as a right to a series
of separate payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days, the
actual date of payment within the specified period shall be within the sole discretion of the Company or the Partnership, as the
case may be.

 

19.         Withholding.
The Company or the Partnership shall be entitled to withhold from all payments to the Employee hereunder all amounts required to
be withheld under applicable local, state or federal income and employment tax laws.

 

20.         Clawbacks.
All incentive-based compensation paid to the Employee hereunder will be subject to the policies of the Company and the Partnership
regarding clawbacks of erroneously awarded incentive-based compensation triggered by an accounting restatement, as required by
law and approved by the Board in the case of the Company.

 

21.         Dispute
Resolution. Any dispute, controversy or claim between the Company or the Partnership and the Employee or other Person arising
out of or relating to this Agreement shall be settled by arbitration conducted in San Diego, California, in accordance with the
National Rules for the Resolution of Employment Disputes of the American Arbitration Association then in force and California law
within thirty (30) days after written notice from one party to the other requesting that the matter be submitted to arbitration;
provided that this Section 21 shall not apply to, and the Company and the Partnership shall be free to seek, injunctive or other
equitable relief with respect to any actual or threatened violation by the Employee of his or her obligations under Section 16
hereof in any court of competent jurisdiction. The arbitration decision or award shall be binding and final upon the parties. The
arbitration award shall be in writing and shall set forth the basis thereof. The parties hereto shall abide by all awards rendered
in such arbitration proceedings, and all such awards may be enforced and executed upon in any court having jurisdiction over the
party against whom enforcement of such award is sought. Each party shall be responsible for its own costs and expenses in any dispute
or proceeding regarding the enforcement of this Agreement.

 

22.         Miscellaneous.
This Agreement shall be construed and enforced in accordance with the laws of the State of California (exclusive of conflict of
law principles). In the event that any provision of this Agreement shall be invalid, illegal or unenforceable, the remainder shall
not be affected thereby. This Agreement supersedes and terminates any prior employment agreement, severance agreement, change of
control agreement or non-competition agreement between the Company or the Partnership and the Employee. It is intended that the
payments and benefits provided under this Agreement are in lieu of, and not in addition to, termination, severance or change of
control payments and benefits provided under the other termination or severance plans, policies or agreements, if any, of the Company
or the Partnership. This Agreement shall be binding upon and inure to the benefit of the Employee and the Employee’s heirs
and personal representatives, the Company and the Partnership, and their successors, assigns and legal representatives. Headings
herein are inserted for convenience and shall not affect the interpretation of any provision of the Agreement. References to sections
of the Exchange Act or the Code, or rules or regulations related thereto, shall be deemed to refer to any successor provisions,
as applicable. The Company and the Partnership will require any successors thereto (whether direct or indirect, by purchase, merger,
consolidation, or otherwise) to expressly assume and agree to perform under this Agreement in the same manner and to the same extent
that the Company and the Partnership would be required to perform if no such succession had taken place. This Agreement may not
be terminated, amended, or modified except by a written agreement executed by the parties hereto or their respective successors
and legal representatives.

 

    	 	14	 

     

    

 

23.         Counterparts.
This Agreement may be signed in counterparts, each of which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument.

 

(Signature pages to follow)

 

    	 	15	 

     

    

 

IN WITNESS WHEREOF,
the parties hereto have executed this Agreement as of the day and year first above written.

 

	 	INNOVATIVE INDUSTRIAL PROPERTIES, INC.
	 	 
	 	By:	 
	 	 	[insert name]
	 	 	[insert title]
	 	 
	 	IIP OPERATING PARTNERSHIP, LP
	 	 
	 	By:	INNOVATIVE INDUSTRIAL PROPERTIES, INC.
	 	 	Its General Partner
	 	 
	 	By:	 
	 	 	[insert name]
	 	 	[insert title]
	 	 
	 	EMPLOYEE
	 	 
	 	 
	 	Alan D. Gold

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