EXHIBIT 3.3

                      ARTICLES OF AMENDMENT AND RESTATEMENT

                                       OF

                         SHOPOFF PROPERTIES TRUST, INC.

     Shopoff Properties Trust, Inc., a Maryland corporation (the "Corporation")
having its principal office at 8951 Research Drive, Irvine, California 92618,
hereby certifies that:

     FIRST: The Corporation desires to amend and restate its charter (the
"Charter") as currently in effect.

     SECOND: The following provisions are all of the provisions of the Charter
currently in effect and as hereinafter amended:

                                      ***

                                   ARTICLE I

                                      NAME

   The name of the corporation (which is hereinafter called the "Corporation")
is:

                         Shopoff Properties Trust, Inc.

                                   ARTICLE II

                                     PURPOSE

     The purposes for which the Corporation is formed are to engage in any
lawful act or activity (including, without limitation or obligation, qualifying
as a real estate investment trust under Sections 856 through 860, or any
successor sections, of the Internal Revenue Code of 1986, as amended (the
"Code")), for which corporations may be organized under the Maryland General
Corporation Law (the "MGCL") and the general laws of the State of Maryland as
now or hereafter in force.

                                   ARTICLE III

                  PRINCIPAL OFFICE IN STATE AND RESIDENT AGENT

     The address of the principal office of the Corporation in this State is c/o
Harbor City Research, Inc., Suite 900, 201 North Charles Street, Baltimore,
Maryland 21201. The name and address of the resident agent of the Corporation in
this State are: Harbor City Research, Inc., Suite 900, 201 North Charles Street,
Baltimore, Maryland 21201.



                                   ARTICLE IV

                                   DEFINITIONS

     As used in this Charter, the terms set forth below shall have the following
respective meanings.

     "Acquisition Expenses" means any and all expenses incurred by the
Corporation, the Advisor, the Operating Partnership, or any Affiliate thereof in
connection with the selection or acquisition of any Real Estate Asset,
including, without limitation, legal fees and expenses, travel and
communications expenses, costs of appraisals, nonrefundable option payments on
property not acquired, accounting fees and expenses, title insurance premiums,
and other closing and miscellaneous expenses related to selection and
acquisition of Real Estate Assets, whether or not acquired.

     "Acquisition Fee" means any and all fees and commissions, exclusive of
Acquisition Expenses, paid by any Person to any other Person (including any fees
or commissions paid by or to any Affiliate of the Corporation or the Advisor) in
connection with the making or investing in mortgage loans or the purchase,
development or construction of any property or other Real Estate Asset,
including, without limitation, real estate commissions, Development Fees and
Construction Fees (except as provided in the following sentence), selection
fees, nonrecurring management fees, loan fees, points, or any other fees or
commissions of a similar nature. Excluded shall be all Development Fees or
Construction Fees paid to any Person or entity not affiliated with the Sponsor
or Advisor in connection with the actual development and construction of any
property or other Real Estate Asset.

     "Actual Ownership" is defined in Section 7.1.

     "Advisor" or "Advisors" means the Person or Persons, if any, appointed,
employed or contracted with by the Corporation pursuant to Article IX hereof and
responsible for directing or performing the day-to-day business affairs of the
Corporation, including any Person to whom the Advisor subcontracts substantially
all of such functions. The initial Advisor is Shopoff Advisors, L.P.

     "Advisory Agreement" means the advisory agreement between the Corporation,
the Operating Partnership and the Advisor pursuant to which the Advisor will
direct or perform the day-to-day business affairs of the Corporation.

     "Affiliate" means, (A) any Person directly or indirectly owning,
controlling, or holding, with power to vote, 10% or more of the outstanding
voting securities of such other Person, (B) any Person 10% or more of whose
outstanding voting securities are directly or indirectly owned, controlled, or
held, with the power to vote, by such other Person, (C) any Person, directly or
indirectly, controlling, controlled by, or under common control with such other
Person, (D) any executive officer, director, trustee, general partner or manager
of such other person, or (E) any legal entity for which such Person acts as an
executive officer, director, trustee, general partner or manager.


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     "Affiliated Seller" means the Advisor, the Sponsor, a Director or any of
their respective Affiliates.

     "Applicable Value" is defined in Section 7.1.

     "Average Invested Assets" means, for a specified period, the average of the
aggregate book value of the assets of the Corporation invested, directly or
indirectly, in equity interests in and loans secured by real estate, before
reserves for depreciation or bad debts or other similar non-cash reserves,
computed by taking the average of such values at the end of each month during
such period.

     "Beneficial Ownership" is defined in Section 7.1.

     "Beneficiary" is defined in Section 7.1.

     "Broker-Dealer" means Shopoff Securities, Inc. or such other Person or
entity selected by the Board of Directors to act as the sole broker-dealer for
the offering of the Shares. Shopoff Securities, Inc. is a member of the National
Association of Securities Dealers, Inc.

     "Business Day" shall mean any day, other than a Saturday or Sunday, that is
neither a legal holiday nor a day on which banking institutions in New York City
are authorized or required by law, regulation or executive order to close.

     "Bylaws" means the Bylaws of the Corporation, as amended from time to time.

     "Charter" means the charter of the Corporation, as amended, restated or
supplemented from time to time.

     "Code" is defined in Article II.

     "Common Stock" is defined in Section 5.1.

     "Competitive Real Estate Commission" means a real estate or brokerage
commission paid for the purchase or sale of property which is reasonable,
customary, and competitive in light of the size, type, and location of the
property.

     "Contract Purchase Price" means the amount actually paid for a Real Estate
Asset or allocated to the purchase, development, construction or improvement of
a Real Estate Asset, exclusive of Acquisition Fees and Acquisition Expenses.

     "Control" means, with respect to a Person, the possession (directly or
indirectly) of the power to direct or cause the direction of the management and
policies of such Person, whether through ownership of voting securities, by
contract or otherwise.

     "Development Fee" means a fee for the packaging of a property held by the
Corporation, including the negotiation and approval of plans, and any
undertaking to assist in obtaining


                                        3



zoning and necessary variances and financing for a specific property, either
initially or at a later date.

     "Director" means a member of the Corporation's Board of Directors as
contemplated by ARTICLE VI.

     "Dividends" means any dividends or other distributions of money or other
property by the Corporation to the Stockholders, including distributions that
may constitute a return of capital for federal income tax purposes.

     "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.

     "Excess Amount" is defined in Section 9.9.

     "Gross Proceeds" means the aggregate purchase price of all Common Stock
sold for the account of the Corporation.

     "Indemnitee" is defined in Section 12.3(a).

     "Independent Director" means a Director who is not, and within the last two
years has not been, directly or indirectly associated with the Advisor or
Sponsor by virtue of (i) ownership of an interest in the Advisor, the Sponsor or
any of their Affiliates, (ii) employment by the Advisor, the Sponsor or any of
their Affiliates, (iii) service as an officer, trust manager or director of the
Advisor, the Sponsor or any of their Affiliates, (iv) performance of services,
other than as a Director, for the Corporation, (v) service as a director, trust
manager or trustee of more than three real estate investment trusts advised by
the Advisor or organized by the Sponsor, or (vi) maintenance of a material
business or professional relationship with the Advisor, the Sponsor or any of
their Affiliates. A business or professional relationship is considered material
if the gross revenue derived by the Director from the Advisor or Sponsor and
their Affiliates exceeds five percent of either the Director's annual gross
revenue, derived from all sources, during either of the last two years or the
Director's net worth on a fair market value basis. An indirect relationship
shall include circumstances in which a Director's spouse, parents, children,
siblings, mothers- or fathers-in-law, sons- or daughters-in-law or brothers- or
sisters-in-law is or has been associated with the Advisor or Sponsor or any of
their Affiliates or the Corporation.

     "Independent Expert" means a Person or entity with no material current or
prior business or personal relationship with the Advisor or any of the Directors
that is engaged to a substantial extent in the business of rendering opinions
regarding the value of assets of the type held by the Corporation.

     "Initial Public Offering" means the offering and sale of Shares pursuant to
the Corporation's first effective registration statement covering such Shares
filed under the Securities Act of 1933, as amended.

     "Invested Capital" means an amount equal to (x) the number of Shares
purchased by Stockholders, multiplied by (y) the price of the Shares in the
Initial Public Offering.


                                        4



     "Leverage" means the aggregate amount of indebtedness of the Corporation
for money borrowed (including purchase money mortgage loans) outstanding at any
time, both secured and unsecured.

     "Listing" or "Listed" means the listing of the Corporation's Common Stock
on a national securities exchange or quotation of the Corporation's Common Stock
on the National Market System of the Nasdaq Stock Market.

     "MGCL" is defined in Article II.

     "Net Assets" means the total assets of the Corporation (other than
intangibles), at cost, before deducting depreciation or other non-cash reserves,
less total liabilities, calculated at least quarterly by the Corporation on a
basis consistently applied.

     "Net Income" means for any period, the total revenues of the Corporation
applicable to such period, less the total expenses of the Corporation applicable
to such period excluding additions to reserves for depreciation, bad debts or
other similar non-cash reserves; provided, however, that Net Income for purposes
of calculating total allowable Operating Expenses shall exclude the gain from
the sale of the Corporation's assets.

     "Non-Transfer Event" is defined in Section 7.1.

     "Operating Expenses" means all direct and indirect costs and expenses
incurred by the Corporation, the Operating Partnership, the Advisor, or any of
their respective Affiliates, as determined under GAAP, which in any way are
related to the operation of the Corporation or to Corporation business,
including advisory fees, but excluding (i) the expenses of raising capital such
as Organizational and Offering Expenses, legal, audit, accounting, underwriting,
brokerage, listing, registration, and other fees, printing and other such
expenses and taxes incurred in connection with the issuance, distribution,
transfer, registration and Listing of the Common Stock, (ii) interest payments,
(iii) taxes, (iv) non-cash expenditures such as depreciation, amortization and
bad debt reserves, (v) Acquisition Fees and Acquisition Expenses, (vi) real
estate commissions on the sale of property, and other expenses connected with
the acquisition and ownership of real estate interests, mortgage loans, or other
property (such as the costs of foreclosure, insurance premiums, legal services,
maintenance, repair, and improvement of property) and (vii) any incentive fees
which may be paid in compliance with the NASAA REIT Guidelines. The definition
of "Operating Expenses" set forth above is intended to encompass only those
expenses which are required to be treated as Operating Expenses under the NASAA
REIT guidelines. As a result, and notwithstanding the definition set forth
above, any expense of the Corporation which is not an Operating Expense under
the NASAA REIT Guidelines shall not be treated as an Operating Expense for
purposes hereof.

     "Operating Partnership" means Shopoff Partners, L.P., a Delaware limited
partnership, and any successor thereof.


                                        5



     "OP Partnership Agreement" means the Agreement of Limited Partnership of
the Operating Partnership, as the same may be amended from time to time.

     "OP Units" means Partnership Units (as such term may be defined in the OP
Partnership Agreement from time to time) representing partner interests in the
Operating Partnership.

     "Organizational and Offering Expenses" means any and all costs and
expenses, other than selling commissions and fees, incurred by the Corporation,
the Advisor or any Affiliate of either in connection with and in preparing the
Corporation for registration of and subsequently offering and distributing its
Common Stock to the public, which may include but are not limited to legal,
accounting and escrow fees, expenses for printing, engraving, amending,
supplementing and mailing, distribution costs, compensation to employees while
engaged in registering, telephone costs, all advertising and marketing expenses,
charges of transfer agents, registrars, trustees, escrow holders, depositories,
experts, and fees, expenses and taxes related to the filing, registration and
qualification of the sale of the securities under federal and state laws,
including accountants' and attorneys' fees and other accountable offering
expenses. Organizational and Offering Expenses may include, but are not limited
to: (i) amounts to reimburse the Advisor for all marketing related costs and
expenses such as compensation to and direct expenses of the Advisor's employees
or employees of the Advisor's Affiliates in connection with registering and
marketing the Common Stock; (ii) direct expenses of the employees of the
Broker-Dealer while preparing for the offering and marketing of the Common
Stock; (iii) travel and entertainment expenses related to the offering and
marketing of the Common Stock; (iv) facilities and technology costs and other
costs and expenses associated with the offering and to facilitate the marketing
of the Common Stock including web site design and management.

     "Ownership Limit" is defined in Section 7.1.

     "Permitted Transferee" is defined in Section 7.1.

     "Person" means an individual, corporation, partnership, limited
partnership, limited liability company, estate, trust (including a trust
qualified under Section 401(a) or 501(c)(17) of the Code), a portion of a trust
permanently set aside for or to be used exclusively for the purposes described
in Section 642(c) of the Code, association, private foundation within the
meaning of Section 509(a) of the Code, joint stock company or other entity and
also includes a group as that term is used for purposes of Section 13(d) (3) of
the Securities Exchange Act of 1934, as amended, and (for purposes of Article
VII) a group to which an Excepted Holder Limit applies.

     "Preferred Stock" is defined in Section 5.1.

     "Proceeding" is defined in Section 12.3(a).

     "Prohibited Owner" is defined in Section 7.1.

     "Real Estate Assets" means unimproved and improved real property and real
estate-related assets or any direct and indirect interest therein (including,
without limitation, fee or


                                        6



leasehold interests, options, leases, partnership and joint venture interests,
equity and debt securities of entities that own real property, first or second
mortgages on real property, mezzanine loans directly or indirectly secured by
real property, and other contractual rights in real estate).

     "REIT" means a "real estate investment trust" as defined in Section 856 of
the Code and applicable Treasury Regulations.

     "REIT Requirements" means the requirements for qualification as a REIT
under the Code and the Treasury Regulations.

     "Restriction Termination Date" is defined in Section 7.1.

     "Roll-up Entity" means a Person that would be created or would survive
after the successful completion of a proposed Roll-Up Transaction.

     "Roll-up Transaction" means a transaction involving the acquisition,
merger, conversion, or consolidation, directly or indirectly, of the Corporation
and the issuance of securities of a Roll-Up Entity. Such term does not include:
(i) a transaction involving securities of the Corporation that have been listed
on a national securities exchange or included for quotation on the National
Market System of the National Association of Securities Dealers Automated
Quotation System for at least 12 months; or (ii) a transaction involving the
conversion of the Corporation into a limited liability company, trust or other
association not involving a merger, consolidation or other acquisition or
business combination of the Corporation with, into or by another Person, if, as
a consequence of the transaction, there will be no significant adverse change in
Stockholder voting rights, the term of existence of the Corporation,
compensation to the Advisor or the Sponsor or the investment objectives of the
Corporation.

     "SDAT" means the State Department of Assessments and Taxation of the State
of Maryland.

     "Securities" means the Shares or any other stock or other evidences of
equity or beneficial or other interests, voting trust certificates, bonds,
debentures, notes or other evidences of indebtedness, secured or unsecured,
convertible, subordinated or otherwise, or in general any instruments commonly
known as "securities" or any certificates of interest, shares or participations
in, temporary or interim certificates for, receipts for, guarantees of, or
warrants, options or rights to subscribe to, purchase or acquire, any of the
foregoing.

     "Securities Act" means the Securities Act of 1933, as amended.

     "Separate Trust" is defined in Section 7.1.

     "Shares" means shares of the Corporation's Common Stock and Preferred
Stock.

     "Shares-in-Trust" means Shares designated as shares-in-trust and
automatically transferred to a Separate Trust pursuant to Section 7.3.


                                        7




     "Sponsor" means any Person directly or indirectly instrumental in
organizing, wholly or in part, the Corporation or any Person who will control,
manage or participate in the management of the Corporation, and any Affiliate of
such Person. Not included is any Person whose only relationship with the
Corporation is that of an independent property manager of Corporation assets,
and whose only compensation is as such. Sponsor does not include wholly
independent third parties such as attorneys, accountants, and underwriters whose
only compensation is for professional services. A Person also may be deemed a
Sponsor of the Corporation by:

     (i) taking the initiative, directly or indirectly, in founding or
organizing the business or enterprise of the Corporation, either alone or in
conjunction with one or more other Persons;

     (ii) receiving a material participation in the Corporation in connection
with the founding or organizing of the business of the Corporation, in
consideration of services or property, or both services and property;

     (iii) having a substantial number of relationships and contacts with the
Corporation;

     (iv) possessing significant rights to control Corporation properties;

     (v) receiving fees for providing services to the Corporation which are paid
on a basis that is not customary in the Corporation's industry; or

     (vi) providing goods or services to the Corporation on a basis which was
not negotiated at arms length with the Corporation.

     "Stockholder List" is defined in Section 8.6(a).

     "Stockholders" means the holders of record of Shares maintained in the
Corporation's books and records.

     "Transfer" is defined in Section 7.1.

     "Treasury Regulations" means the Federal income tax regulations, including
any temporary or proposed regulations, promulgated under the Code, as such
Treasury Regulations may be amended from time to time (it being understood that
all references herein to specific sections of the Treasury Regulations shall be
deemed also to refer to any corresponding provisions of succeeding Treasury
Regulations).

     "2%/25% Guidelines" is defined in Section 9.9.

     "Trustee" is defined in Section 7.1.


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     "Unimproved Real Property" means any real property in which the Corporation
has an equity interest that is not acquired for the purpose of producing rental
or other operating income, that has no development or construction in process
and for which no development or construction is planned, in good faith, to
commence within one year.

                                    ARTICLE V

                                      STOCK

     Section 5.1 The total number of shares of stock of all classes and series
which the Corporation has authority to issue is 200,000,000 shares of stock (par
value $0.01 per share), amounting in aggregate par value to $2,000,000. One
Hundred Eighty Million (180,000,000) of such shares are initially classified as
"Common Stock" and Twenty Million (20,000,000) of such shares are initially
classified as "Preferred Stock". The Common Stock and the Preferred Stock are
sometimes referred to collectively as the "Capital Stock". The Board of
Directors may classify and reclassify any unissued shares of stock (whether or
not such shares have been previously classified or reclassified) by setting or
changing in any one or more respects the class and series designations of shares
of Capital Stock or setting or changing in any one or more respects the
preferences, conversion or other rights, voting powers, restrictions,
limitations as to dividends, qualifications, or terms or conditions of
redemption of such shares of Capital Stock. The Board of Directors, with the
approval of a majority of the entire board and without action by the
stockholders, may amend the Charter to increase or decrease the aggregate number
of shares of stock of the corporation or the number of shares of stock of any
class that the corporation has authority to issue.

     Section 5.2 The following is a description of the preferences, conversion
and other rights, voting powers, restrictions, limitations as to dividends,
qualifications and terms and conditions of redemption of the Common Stock of the
Corporation:

          (a) Each share of Common Stock shall have one vote, and, except as
     otherwise provided in respect of any class of stock hereafter classified or
     reclassified, the exclusive voting power for all purposes shall be vested
     in the holders of the Common Stock. Shares of Common Stock shall not have
     cumulative voting rights.

          (b) Subject to the provisions of law and any preferences of any class
     of stock hereafter classified or reclassified, dividends, including
     dividends payable in shares of another class of the Corporation's stock,
     may be paid ratably on the Common Stock at such time and in such amounts as
     the Board of Directors may deem advisable.

          (c) In the event of any liquidation, dissolution or winding up of the
     Corporation, whether voluntary or involuntary, the holders of the Common
     Stock shall be entitled, together with the holders of any other class of
     stock hereafter classified or reclassified not having a preference on
     distributions in the liquidation, dissolution or winding up of the
     Corporation, to share ratably in the net assets of the Corporation
     remaining, after payment or provision for payment


                                        9



     of the debts and other liabilities of the Corporation and the amount to
     which the holders of any class of stock hereafter classified or
     reclassified having a preference on distributions in the liquidation,
     dissolution or winding up of the Corporation shall be entitled.

     Section 5.3 Subject to the foregoing, the power of the Board of Directors
to classify and reclassify any of the shares of capital stock shall include,
without limitation, subject to the provisions of the Charter, authority to
classify or reclassify any unissued shares of such stock into a class or classes
of preferred stock, preference stock, special stock or other stock, and to
divide and classify shares of any class into one or more series of such class,
by determining, fixing, or altering one or more of the following:

          (a) The distinctive designation of such class or series and the number
     of shares to constitute such class or series; provided that, unless
     otherwise prohibited by the terms of such or any other class or series, the
     number of shares of any class or series may be decreased by the Board of
     Directors in connection with any classification or reclassification of
     unissued shares and the number of shares of such class or series may be
     increased by the Board of Directors in connection with any such
     classification or reclassification, and any shares of any class or series
     which have been redeemed, purchased, otherwise acquired or converted into
     shares of Common Stock or any other class or series shall become part of
     the authorized capital stock and be subject to classification and
     reclassification as provided in this sub-paragraph.

          (b) Whether or not and, if so, the rates, amounts and times at which,
     and the conditions under which, dividends shall be payable on shares of
     such class or series, whether any such dividends shall rank senior or
     junior to or on a parity with the dividends payable on any other class or
     series of stock, and the status of any such dividends as cumulative,
     cumulative to a limited extent or non-cumulative and as participating or
     non-participating.

          (c) Whether or not shares of such class or series shall have voting
     rights, in addition to any voting rights provided by law and, if so, the
     terms of such voting rights.

          (d) Whether or not shares of such class or series shall have
     conversion or exchange privileges and, if so, the terms and conditions
     thereof, including provision for adjustment of the conversion or exchange
     rate in such events or at such times as the Board of Directors shall
     determine.

          (e) Whether or not shares of such class or series shall be subject to
     redemption and, if so, the terms and conditions of such redemption,
     including the date or dates upon or after which they shall be redeemable
     and the amount per share payable in case of redemption, which amount may
     vary under different conditions and at different redemption dates; and
     whether or not there shall be any sinking fund or purchase account in
     respect thereof, and if so, the terms thereof.


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          (f) The rights of the holders of shares of such class or series upon
     the liquidation, dissolution or winding up of the affairs of, or upon any
     distribution of the assets of, the Corporation, which rights may vary
     depending upon whether such liquidation, dissolution or winding up is
     voluntary or involuntary and, if voluntary, may vary at different dates,
     and whether such rights shall rank senior or junior to or on a parity with
     such rights of any other class or series of stock.

          (g) Whether or not there shall be any limitations applicable, while
     shares of such class or series are outstanding, upon the payment of
     dividends or making of distributions on, or the acquisition of, or the use
     of moneys for purchase or redemption of, any stock of the Corporation, or
     upon any other action of the Corporation, including action under this
     sub-paragraph, and, if so, the terms and conditions thereof.

          (h) Any other preferences, rights, restrictions, including
     restrictions on transferability, and qualifications of shares of such class
     or series, not inconsistent with law and the Charter of the Corporation.

     Section 5.4 For the purposes hereof and of any articles supplementary to
the Charter providing for the classification or reclassification of any shares
of capital stock or of any other Charter document of the Corporation (unless
otherwise provided in any such articles or document), any class or series of
stock of the Corporation shall be deemed to rank:

          (a) prior to another class or series either as to dividends or upon
     liquidation, if the holders of such class or series shall be entitled to
     the receipt of dividends or of amounts distributable on liquidation,
     dissolution or winding up, as the case may be, in preference or priority to
     holders of such other class or series;

          (b) on a parity with another class or series either as to dividends or
     upon liquidation, whether or not the dividend rates, dividend payment dates
     or redemption or liquidation price per share thereof be different from
     those of such others, if the holders of such class or series of stock shall
     be entitled to receipt of dividends or amounts distributable upon
     liquidation, dissolution or winding up, as the case may be, in proportion
     to their respective dividend rates or redemption or liquidation prices,
     without preference or priority over the holders of such other class or
     series; and

          (c) junior to another class or series either as to dividends or upon
     liquidation, if the rights of the holders of such class or series shall be
     subject or subordinate to the rights of the holders of such other class or
     series in respect of the receipt of dividends or the amounts distributable
     upon liquidation, dissolution or winding up, as the case may be.

     Section 5.5 (a) Subject to suitability standards established by individual
states or any higher standards established by the Board of Directors to become a
Stockholder in the Corporation, if the prospective Stockholder is an individual
(including an individual beneficiary of a purchasing Individual Retirement
Account as defined in the Code), or if the prospective


                                       11



Stockholder is a fiduciary (such as a trustee of a trust or corporate pension or
profit sharing plan, or other tax-exempt organization, or a custodian under a
Uniform Gifts to Minors Act), such individual or fiduciary, as the case may be,
must represent to the Corporation, among other requirements as the Corporation
may require from time to time: (i) that such individual (or, in the case of a
fiduciary account, that the fiduciary, the beneficiary, the account or the donor
who directly or indirectly supplies the funds to purchase the Shares) has a
minimum annual gross income of $45,000 and a net worth (excluding home, home
furnishings and automobiles) of not less than $45,000; or (ii) that such
individual (or, in the case of a fiduciary account, that the fiduciary, the
beneficiary, the account or the donor who directly or indirectly supplies the
funds to purchase the Shares) has a net worth (excluding home, home furnishings
and automobiles) of not less than $150,000.

          (b) The Corporation shall require the Sponsor or any other Person
selling Shares on behalf of the Corporation to make every reasonable effort to
determine that the purchase of Shares is a suitable and appropriate investment
for each Stockholder. In making this determination, the Sponsor or any other
Person selling Shares on behalf of the Corporation shall ascertain that the
prospective Stockholder:

               (i) meets the minimum income and net worth standards set forth in
     Section 5.5(a);

               (ii) can reasonably benefit from an investment in the Corporation
     based on the prospective Stockholder's overall investment objectives and
     portfolio structure;

               (iii) is able to bear the economic risk of the investment based
     on the prospective Stockholder's overall financial situation; and

               (iv) has apparent understanding of: (A) the fundamental risks of
     the investment; (B) the risk that the Stockholder may lose the entire
     investment; (C) the lack of liquidity of the Shares; (D) the restrictions
     on transferability of the Shares; (E) the background and qualifications of
     the Sponsor and the Advisor; and (F) the tax consequences of the
     investment.

          The Sponsor or each Person selling shares on behalf of the Sponsor or
the Corporation shall make this determination on the basis of information or
representations it has obtained from a prospective Stockholder. Relevant
information for this purpose will include at least the age, investment
objectives, investment experiences, income, net worth, financial situation and
other investments of the prospective Stockholder, as well as any other pertinent
factors. The Sponsor or any other Person selling Shares on behalf of the
Corporation shall maintain records of the information used to determine that an
investment in Shares is suitable and appropriate for a Stockholder. The Sponsor
or any other Person selling Shares on behalf of the Corporation shall maintain
these records or copies of representations made for at least six years.


                                       12



          (c) Subject to certain individual state requirements or higher
standards established by the Board of Directors from time to time, no
Stockholder will be permitted to make an initial investment in the Corporation
by purchasing less than 2,000 shares.

     Section 5.6 Initial Investment of the Sponsor. Before the initial public
offering of the Corporation, the Sponsor shall have purchased 21,100 shares of
Common Stock. The Sponsor or any such Affiliate may not sell the interest in the
Corporation acquired with its this initial investment while the Sponsor remains
a Sponsor but may transfer the interest in the Corporation acquired with this
initial investment to its Affiliates. Such Affiliates will be subject to the
restrictions on transfer in the preceding sentence while the Sponsor remains a
Sponsor.

                                   ARTICLE VI

                               BOARD OF DIRECTORS

     Section 6.1 (a) The number of Directors shall be nine. The number of
Directors shall be fixed by, or in the manner provided in, the Bylaws of the
Corporation, and may be increased or decreased from time to time in the manner
prescribed in the Bylaws; provided, however, that the number of Directors shall
never be fewer than three nor more than fifteen. The directors (except for the
directors elected by the holders of any one or more class or series of Preferred
Stock of the Corporation shall be divided into five classes as follows:

               (i) The term of office of Class I shall be until the 2008 annual
     meeting of stockholders and until their successors shall be elected and
     have qualified and thereafter shall be for five years and until their
     successors shall be elected and have qualified;

               (ii) the term of office of Class II shall be until the 2009
     annual meeting of stockholders and until their successors shall be elected
     and have qualified and thereafter shall be for five years and until their
     successors shall be elected and have qualified;

               (iii) the term of office of Class III shall be until the 2010
     annual meeting of stockholders and until their successors shall be elected
     and have qualified and thereafter shall be for five years and until their
     successors shall be elected and have qualified;

               (iv) the term of office of Class IV shall be until the 2011
     annual meeting of stockholders and until their successors shall be elected
     and have qualified and thereafter shall be for five years and until their
     successors shall be elected and have qualified; and

               (v) the term of office of Class V shall be until the 2012 annual
     meeting of stockholders and until their successors shall be elected and
     have qualified and thereafter shall be for five years and until their
     successors shall be elected and have qualified.

          (b) If the number of directors is changed, any increase or decrease
shall be apportioned among the classes so as to maintain or attain, if possible,
the equality of the number


                                       13



of directors in each class. If such equality is not possible, the increase or
decrease shall be apportioned among the classes in such a way that the
difference in the number of directors in any two classes shall not exceed one.

          (c) The names of the individuals who will serve as directors of the
Corporation until their successors are elected and qualify are as follows:

               (i)   The following persons shall serve as Class I directors:
                     Kevin M. Bridges and Melanie Barnes

               (ii)  The following persons shall serve as Class II directors:
                     Glenn Patterson and Patrick Meyer

               (iii) The following persons shall serve as Class III directors:
                     Diane Kennedy and Stuart McManus

               (iv)  The following persons shall serve as Class IV directors:
                     Edward Fitzpatrick and Jeffrey W. Shopoff

               (v)   The following person shall serve as Class V director:
                     William A. Shopoff

          (d) At such time as the Corporation has three independent directors
and the Corporation has a class of equity securities registered under the
Securities Exchange Act of 1934, as amended, the Corporation elects to be
subject to the provisions of 3-804(c) of the MGCL which provides that (1) any
vacancy created by an increase in the size of the board of directors or the
death, resignation or removal of a director may be filled only by the
affirmative vote of a majority of the remaining directors in office, even if the
remaining directors do not constitute a quorum and (2) any director so elected
to fill a vacancy shall hold office for the remainder of the full term of the
class of directors in which the vacancy occurred and until a successor is
elected and qualifies. No decrease in the number of directors constituting the
Board of Directors shall affect the tenure of office of any director.

          (e) Whenever the holders of any one or more series of Preferred Stock
of the Corporation shall have the right, voting separately as a class, to elect
one or more directors of the Corporation, the Board of Directors shall consist
of said directors so elected in addition to the number of directors fixed as
provided in this Article SEVENTH or in the Bylaws. Notwithstanding the
foregoing, and except as otherwise may be required by applicable law, whenever
the holders of any one or more class or series of Preferred Stock of the
Corporation shall have the right, voting separately as a class, to elect one or
more directors of the


                                       14



Corporation, the terms of the director or directors elected by such holders
shall expire at the next succeeding annual meeting of stockholders.

          (f) Subject to the rights of the holders of any class or series of
Preferred Stock of the Corporation entitled, voting as a class, to elect or
remove one or more directors of the Corporation, any director, or the entire
Board of Directors, may be removed from office at any time, but only for "cause"
and by the vote of the holders of not less than 66-2/3% of the outstanding
shares of stock of the Corporation entitled to vote generally in the election of
directors (considered for this purpose as one class). For the purposes of this
ARTICLE VI, Section 6.1, "cause" shall mean, with respect to any particular
director, a final judgment of a court of competent jurisdiction holding that
such director caused demonstrable, material harm to the Corporation through bad
faith or active and deliberate dishonesty.

     Section 6.2 Subject to the MGCL, the Directors may establish such
committees as they deem appropriate, in their discretion, provided that each
committee consists solely of Independent Directors. The initial committees are
the audit committee, the compensation committee and the nominating and
governance committee.

     Section 6.3 The Directors serve in a fiduciary capacity to the Corporation
and the Stockholders and have a fiduciary duty to supervise the relationship
between the Corporation and the Advisor.

     Section 6.4 In determining what is in the best interests of the
Corporation, including, but not limited to, a transaction involving a change of
control of the Corporation, a Director shall consider the interests of the
Stockholders and, in his or her sole and absolute discretion, may consider any
other factors, interests, or effects allowed by the MGCL or other applicable
law.

     Section 6.5 A majority of Independent Directors must approve all applicable
matters to which this Section 6.5, Sections 5.2(c), 8.1, 9.1, 9.2, 9.4, 9.5,
9.6, 9.7, 9.8, 9.9, 10.2, 10.3, 10.4(f), 10.4(i), and Articles XI and XII apply.

                                   ARTICLE VII

                     RESTRICTIONS ON TRANSFER AND OWNERSHIP

     Section 7.1. Definitions. For the purpose of this Article VII, the
following terms shall have the following meanings:

          "Applicable Value" shall mean, as of any date, with respect to each
Share, the fair value of such Share, as determined in good faith by the Board of
Directors.

          "Actual Ownership" shall mean ownership of Shares by a Person who
would own such Shares either directly as the record owner or indirectly through
a nominee, custodial or similar arrangement; provided that such Person shall be
treated as the Actual Owner of such shares only if such Person would be required
(ignoring for this purpose any special tax status of such Person, e.g., as a
tax-exempt organization) to include in gross income for U.S. federal


                                       15



income tax purposes the distributions received with respect to such shares. In
any case, Actual Ownership shall be determined without taking into account any
attribution rules or constructive ownership rules under the Code. The terms
"Actual Owner," "Actually Owns," and "Actually Owned" shall have correlative
meanings.

          "Beneficial Ownership" shall mean, with respect to any Person,
ownership of Shares equal to the sum of (i) the Shares Actually Owned by such
Person and (ii) the Shares indirectly owned by such Person (if such Person is an
"individual" as defined in Section 542(a)(2) of the Code) taking into account
the constructive ownership rules of Section 544 of the Code, as modified by
Section 856(h)(1)(B) of the Code. The terms "Beneficial Owner," "Beneficially
Owns" and "Beneficially Owned" shall have correlative meanings.

          "Beneficiary" shall mean, with respect to any Separate Trust, one or
more organizations described in each of Section 170(b)(1)(A) and Section 170(c)
of the Code that are named by the Corporation as the beneficiary or
beneficiaries of such Separate Trust, in accordance with the provisions of
Section 7.12(a).

          "Non-Transfer Event" shall mean any event other than a purported
Transfer that would cause (i) any Person to Beneficially Own Shares of any class
in excess of the Ownership Limit, (ii) the Corporation to become "closely held"
within the meaning of Section 856(h) of the Code, and/or (iii) the Corporation
to otherwise fail to qualify as a REIT (other than as a result of a violation of
the "100-shareholder" requirement of Section 856(a) (5) of the Code), in each
case including, but not limited to (x) the granting of any option or entering
into any agreement for the sale, transfer or other disposition of Shares, (y)
the sale, transfer, assignment or other disposition of any securities or rights
convertible into or exchangeable for Shares, or (z) changes in the ultimate
direct or indirect ownership of any Person that is a record owner of Shares.

          "Ownership Limit" shall mean, with respect to each class of Shares of
the Corporation outstanding as of any particular time, 9.8% of the total number
of shares of such class of Shares outstanding as of such time.

          "Permitted Transferee" shall mean any Person designated as a Permitted
Transferee in accordance with the provisions of Section 7.12(e) hereof.

          "Prohibited Owner" shall mean, with respect to any purported Transfer
or Non-Transfer Event, any Person who, but for the provisions of Section 7.3,
would own record title to Shares.

          "Restriction Termination Date" shall mean the first day after which
(i) the Board of Directors determines that it is no longer in the best interests
of the Corporation to continue to qualify as a REIT and (ii) the Stockholders
affirmatively vote to revoke the Corporation's election to be taxed as a REIT.

          "Separate Trust" shall mean any separate trust created pursuant to
Section 7.3 and administered in accordance with the terms of Section 7.12, for
the exclusive benefit of any Beneficiary.


                                       16



          "Transfer" shall mean any sale, transfer, gift, assignment, devise or
other disposition of Shares, whether voluntary or involuntary, whether of
record, constructively or beneficially and whether by operation of law or
otherwise.

          "Trustee" shall mean any person or entity unaffiliated with both the
Corporation and any Prohibited Owner, such Trustee to be designated by the
Corporation to act as trustee of any Separate Trust, or any successor trustee
thereof.

     Section 7.2. Restrictions on Ownership and Transfers.

          (a) From the date of the Initial Public Offering and prior to the
Restriction Termination Date, except as provided in Section 7.9, (i) no Person
shall Beneficially Own outstanding Shares of any class in excess of the
Ownership Limit and (ii) any Transfer that, if effective, would result in any
Person Beneficially Owning Shares of any class in excess of the Ownership Limit
shall be void ab initio as to the Transfer of that number of shares that would
be otherwise Beneficially Owned by such Person in excess of the Ownership Limit;
and the intended transferee shall acquire no rights in such excess Shares.

          (b) Notwithstanding any other provision herein, from the date of the
Initial Public Offering and prior to the Restriction Termination Date, any
Transfer that, if effective, would result in the Shares being Actually Owned by
fewer than 100 Persons shall be void ab initio in its entirety; and the intended
transferee shall acquire no rights in any of such Shares intended to be
Transferred.

          (c) Notwithstanding any other provision herein, any Transfer of Shares
that, if effective on or after the date of the Initial Public Offering and prior
to the Restriction Termination Date, would result in the Corporation being
"closely held" within the meaning of Section 856(h) of the Code shall be void ab
initio as to the Transfer of that number of Shares that would cause the
Corporation to be "closely held" within the meaning of Section 856(h) of the
Code; and the intended transferee shall acquire no rights in such excess Shares.

          (d) Notwithstanding any other provision herein, any Transfer of Shares
that, if effective on or after the date of the Initial Public Offering and prior
to the Restriction Termination Date, would cause the Corporation to fail to
qualify as a REIT shall be void ab initio as to the Transfer of that number of
Shares in excess of the number that could have been Transferred without such
result; and the intended transferee shall acquire no rights in such excess
Shares.

     Section 7.3. Transfer in Trust.

          (a) If, notwithstanding the other provisions contained in this Article
VII, at any time on or after the date of the Initial Public Offering and prior
to the Restriction Termination Date, there is a purported Transfer or
Non-Transfer Event such that any Person would Beneficially Own Shares of any
class in excess of the Ownership Limit, then, (i) except as otherwise provided
in Section 7.9, the purported transferee shall acquire no right or interest (or,


                                       17



in the case of a Non-Transfer Event, the Person holding record title to the
Shares Actually or Beneficially Owned by such Actual or Beneficial Owner shall
cease to own any right or interest) in such number of Shares that would cause
such result, and (ii) such number of Shares in excess of, as applicable, the
Ownership Limit (rounded up to the nearest whole share) shall be designated
Shares-in-Trust and, in accordance with Section 7.12, transferred automatically
and by operation of law to a Separate Trust to be held in accordance with that
Section 7.12. Such transfer to a Separate Trust and the designation of the
shares as Shares-in-Trust shall be effective as of the close of business on the
business day prior to the date of the purported Transfer or Non-Transfer Event,
as the case may be.

          (b) If, notwithstanding the other provisions contained in this Article
VII, there is a purported Transfer or Non-Transfer Event that, if effective at
any time on or after the date of the Initial Public Offering and prior to the
Restriction Termination Date, would cause the Corporation to become "closely
held" within the meaning of Section 856(h) of the Code or to otherwise fail to
qualify as a REIT (other than as a result of a violation of the 100-shareholder
requirement of Section 856(a) (5) of the Code), then (i) the purported
transferee shall not acquire any right or interest (or, in the case of a
Non-Transfer Event, the Person holding record title to the Shares with respect
to which such Non-Transfer Event occurred shall cease to own any right or
interest) in such number of Shares, the ownership of which by such purported
transferee or record holder would cause the Corporation to be "closely held"
within the meaning of Section 856(h) of the Code or to otherwise fail to qualify
as a REIT (other than as a result of a violation of the 100-shareholder
requirement of Section 856(a) (5) of the Code); and (ii) such number of Shares
(rounded up to the nearest whole share) shall be designated Shares-in-Trust and,
in accordance with the provisions of Section 7.12, transferred automatically and
by operation of law to the Separate Trust to be held in accordance with that
Section 7.12. Such transfer to a Separate Trust and the designation of shares as
Shares-in-Trust shall be effective as of the close of business on the business
day prior to the date of the Transfer or Non-Transfer Event, as the case may be.

     Section 7.4. Remedies For Breach. If the Corporation or its designees shall
at any time determine in good faith that a Transfer has taken place in violation
of Section 7.2 or that a Person intends to acquire or has attempted to acquire
Beneficial Ownership of any Shares in violation of Section 7.2, the Corporation
shall take such action as it deems advisable to refuse to give effect to or to
prevent such Transfer or acquisition, including, but not limited to, refusing to
give effect to such Transfer on the books of the Corporation or instituting
proceedings to enjoin such Transfer or acquisition.

     Section 7.5. Notice of Restricted Transfer. Any Person who acquires or
attempts to acquire Shares in violation of Section 7.2, or any Person who owned
Shares that were transferred to a Separate Trust pursuant to the provisions of
Section 7.3, shall immediately give written notice to the Corporation of such
event and shall provide to the Corporation such other information as the
Corporation may request in order to determine the effect, if any, of such
Transfer or the Non-Transfer Event, as the case may be, on the Corporation's
status as a REIT.

     Section 7.6. Owners Required to Provide Information. Prior to the
Restriction Termination Date:


                                       18



          (a) Every record owner of five percent (5%) or more, or such lower
percentage as may be required pursuant to the Code or the regulations
thereunder, of the outstanding Shares shall within 30 days after January 1 of
each year give written notice to the Corporation stating the name and address of
such record owner, the Actual Owners of such Shares, and such additional
information regarding the Beneficial Owners of such Shares as the Corporation
may reasonably request in order to determine the effect, if any, of such
Beneficial Ownership on the Corporation's status as a REIT and to ensure
compliance with the Ownership Limit.

          (b) Each Person who is a Beneficial Owner of Shares and each Person
(including the Shareholder of record) who is holding Shares for an Actual or
Beneficial Owner shall provide to the Corporation such information as the
Corporation may reasonably request in order to determine the Corporation's
status as a REIT and to ensure compliance with the Ownership Limit.

     Section 7.7. Remedies Not Limited. Nothing contained in this Article VII
shall limit the authority of the Corporation to take such other action as it
deems necessary or advisable to protect the Corporation and the interests of its
Stockholders by preservation of the Corporation's status as a REIT and to ensure
compliance with the Ownership Limit.

     Section 7.8. Ambiguity. In the case of an ambiguity in the application of
any of the provisions of this Article VII, including any definition contained in
Section 7.1, the Board of Directors shall have the power to determine the
application of the provisions of this Article VII with respect to any situation,
based on the facts known to it.

     Section 7.9. Exception. The Board of Directors, in the exercise of its sole
and absolute discretion, may exempt from the operation of Section 7.2 certain
specified Shares proposed to be Beneficially Owned by a Person who has provided
the Board of Directors with such evidence, undertakings and assurances as the
Board of Directors may require that such Beneficial Ownership of the specified
shares will not prevent the continued qualification of the Corporation as a REIT
under the Code and the regulations thereunder. The Board of Directors may, but
shall not be required to, condition the grant of any such exemption upon the
obtaining of an opinion of counsel, a ruling from the Internal Revenue Service,
or such other assurances as the Board of Directors may deem to be satisfactory.

     Section 7.10. Notice to Stockholders upon Issuance or Transfer. Upon
issuance or transfer of Shares, the Corporation shall provide the recipient with
a notice containing information about the shares purchased or otherwise
transferred, in lieu of issuance of a share certificate, in a form substantially
similar to the following:

          The Shares issued or transferred are subject to restrictions on
     transfer for the purpose of the Corporation's maintenance of its status as
     a real estate investment trust (a "REIT") under the Internal Revenue Code
     of 1986, as amended (the "Code"). No Person may at any time Beneficially
     Own any class of Shares in excess of 9.8% of the total number of Shares of
     such class outstanding at any time. No Person may own Shares that would
     result in the Corporation being "closely held" under Section 856(h) of the
     Code or otherwise failing to


                                       19


     qualify as a REIT. Any Person who attempts to acquire or own Shares in
     excess of the above limitations must immediately notify the Corporation in
     writing. If the restrictions above are violated, the Shares represented
     hereby will be transferred automatically and by operation of law to a
     Separate Trust and shall be designated Shares-In-Trust. In addition, no
     transfer of any class of Shares shall be effective if such transfer would
     result in the Corporation's outstanding Shares being Actually Owned by
     fewer than 100 Persons. Certain terms in this notice have meanings defined
     in the Corporation's Charter, as the same may be further amended from time
     to time, a copy of which, including the restrictions on Transfer, will be
     sent without charge to each Stockholder who so requests."

     Section 7.11. Severability. If any provision of this Article VII or any
application of any such provision is determined to be invalid by any federal or
state court having jurisdiction over the issues, the validity of the remaining
provisions shall not be affected and other applications of such provision shall
be affected only to the extent necessary to comply with the determination of
such court.

     Section 7.12. Shares-in-Trust.

          (a) Ownership in Trust. Any Shares transferred to a Separate Trust and
designated Shares-in-Trust pursuant to Section 7.3 shall be held for the
exclusive benefit of the Beneficiary. The Corporation shall name a beneficiary
of each Separate Trust within five (5) days after discovery of the existence
thereof. Any transfer to a Separate Trust, and subsequent designation of Shares
as Shares-in-Trust, pursuant to Section 7.3 shall be effective as of the close
of business on the business day prior to the date of the Transfer or
Non-Transfer Event that results in the transfer to the Separate Trust.
Shares-in-Trust shall remain issued and outstanding Shares and shall be entitled
to the same rights and privileges on identical terms and conditions as are all
other issued and outstanding Shares of the same class and series. When
transferred to the Permitted Transferee in accordance with the provisions of
Section 7.12(e), such Shares-in Trust shall cease to be designated as
Shares-in-Trust.

          (b) Rights to Distributions. The Trustee, as record holder of
Shares-in-Trust, shall be entitled to receive all distributions as may be
declared by the Board of Directors of the Corporation on such Shares and shall
hold such distributions in trust for the benefit of the Beneficiary. The
Prohibited Owner with respect to Shares-in-Trust shall repay to the Trustee the
amount of any distributions received by it that (i) are attributable to any
Shares designated Shares-in-Trust and (ii) the record date of which is on or
after the date that such shares became Shares-in-Trust. The Corporation shall
take all measures that it determines reasonably necessary to recover the amount
of any such distribution paid to a Prohibited Owner, including, if necessary,
withholding any portion of future distributions payable on Shares held by a
Person who, but for the provisions of Section 7.3, would receive the
distributions with respect to the Shares-in-Trust; and, as soon as reasonably
practicable following the Corporation's receipt or withholding thereof, shall
pay over to the Trustee for the benefit of the Beneficiary the distributions so
received or withheld, as the case may be.

          (c) Rights Upon Liquidation. In the event of any voluntary or
involuntary liquidation, dissolution or winding up of, or any distribution of
the assets of, the Corporation,


                                       20



each Trustee of Shares-in-Trust shall be entitled to receive, ratably with each
other holder of Shares of the same class or series, that portion of the assets
of the Corporation that is available for distribution to the holders of such
class and series of Shares. The Trustee shall distribute to the Prohibited Owner
the amounts received upon such liquidation, dissolution, or winding up, or
distribution; provided that, the Prohibited Owner shall not be entitled to
receive amounts pursuant to this Section 7.12(c) in excess of, in the case of a
purported Transfer in which the Prohibited Owner gave value for Shares and which
Transfer resulted in the transfer of the shares to the Separate Trust, the price
per share, if any, such Prohibited Owner paid for the Shares and, in the case of
a Non-Transfer Event or Transfer in which the Prohibited Owner did not give
value for such shares (e.g., if the shares were received through a gift or
devise) and which Non-Transfer Event or Transfer, as the case may be, resulted
in the transfer of shares to the Separate Trust, the price per share equal to
the Applicable Value on the date of such Non-Transfer Event or Transfer. Any
remaining amount in such Separate Trust shall be distributed to the Beneficiary.

          (d) Voting Rights. The Trustee shall be entitled to vote all
Shares-in-Trust. Any vote by a Prohibited Owner as a holder of Shares prior to
the discovery by the Corporation that the Shares are Shares-in-Trust shall,
subject to applicable law and only to the extent that no Person other than the
Corporation and/or the Prohibited Owner are materially and adversely affected,
be rescinded and shall be void ab initio with respect to such Shares-in-Trust,
and the Prohibited Owner shall be deemed to have given, as of the close of
business on the business day prior to the date of the purported Transfer or
Non-Transfer Event that results in the transfer to the Separate Trust of the
Shares under Section 7.3, an irrevocable proxy to the Trustee to vote the
Shares-in-Trust in the manner in which the Trustee, in its sole and absolute
discretion, desires.

          (e) Designation of Permitted Transferee. The Trustee shall have the
exclusive and absolute right to designate a Permitted Transferee of any and all
Shares-in-Trust. As soon as reasonably practicable, in an orderly fashion so as
not to materially adversely affect the Applicable Value of the Shares-in-Trust,
the Trustee shall designate any Person as a Permitted Transferee; provided that,
(i) the Permitted Transferee so designated purchases for valuable consideration
(whether in a public or private sale) the Shares-in-Trust and (ii) the Permitted
Transferee so designated may acquire such Shares-in-Trust without such
acquisition resulting in a transfer to a Separate Trust and the redesignation of
such Shares so acquired as Shares-in-Trust under Section 7.3. Upon the
designation by the Trustee of a Permitted Transferee in accordance with the
provisions of this paragraph, the Trustee of a Separate Trust shall (i) cause to
be transferred to the Permitted Transferee that number of Shares-in-Trust
acquired by the Permitted Transferee; (ii) cause to be recorded on the books of
the Corporation that the Permitted Transferee is the holder of record of such
number of Shares; and (iii) distribute to the Beneficiary any and all amounts
held with respect to the Shares-in-Trust after making that payment to the
Prohibited Owner pursuant to Section 7.12(f).

          (f) Compensation to Record Holder of Shares that Become
Shares-In-Trust. Any Prohibited Owner shall be entitled (following discovery of
the Shares-in-Trust and subsequent designation of the Permitted Transferee in
accordance with Section 7.12(e) of this Article VII) to receive from the Trustee
the lesser of (i) in the case of (a) a purported Transfer in which the
Prohibited Owner gave value for Shares and which Transfer resulted in the
transfer of the shares to the Separate Trust, the price per share, if any, such
Prohibited Owner paid for the Shares, or


                                       21



(b) a Non-Transfer Event or Transfer in which the Prohibited Owner did not give
value for such shares (e.g., if the shares were received through a gift or
devise) and which Non-Transfer Event or Transfer, as the case may be, resulted
in the transfer of shares to the Separate Trust, the price per share equal to
the Applicable Value on the date of such Non-Transfer Event or Transfer, and
(ii) the price per share received by the Trustee of the Separate Trust from the
sale or other disposition of such Shares-in-Trust in accordance with Section
7.12(e). Any amounts received by the Trustee in respect of such Shares-in-Trust
in excess of such amounts to be paid to the Prohibited Owner pursuant to this
Section 7.12(f) shall be distributed to the Beneficiary in accordance with the
provisions of Section 7.12(e). Each Beneficiary and Prohibited Owner waives any
and all claims that they may have against the Trustee and the Separate Trust
arising out of the disposition of Shares-in-Trust, except for claims arising out
of the gross negligence or willful misconduct of, or any failure to make
payments in accordance with this Section 7.12 by, such Trustee or the Separate
Trust.

          (g) Purchase Right in Share-in-Trust. Shares-in-Trust shall be deemed
to have been offered for sale to the Corporation, or its designee, at a price
per share equal to the lesser of (i) the price per share in the transaction that
created such Shares-in-Trust (or, in the case of devise, gift or Non-Transfer
Event, the Applicable Value at the time of such devise, gift or Non-Transfer
Event) and (ii) the Applicable Value on the date the Corporation, or its
designee, accepts such offer. The Corporation shall have the right to accept
such offer for a period of ninety days after the later of (i) the date of the
Non-Transfer Event or purported Transfer that resulted in such Shares-in-Trust
and (ii) the date the Corporation determines in good faith that a Transfer or
Non-Transfer Event resulting in Shares-in-Trust has occurred, if the Corporation
does not receive a notice of such Transfer or Non-Transfer Event pursuant to
Section 7.5.

                                  ARTICLE VIII

                                  STOCKHOLDERS

     Section 8.1 Meetings.

          (a) Annual Meetings. An annual meeting of Stockholders will be held
each year, at least 30 days after the delivery of the annual report, upon
reasonable notice, for the purpose of electing directors and for the transaction
of such other business as may properly come before the meeting. The Board of
Directors shall take reasonable steps to ensure that the annual meeting is held.

          (b) Special Meetings. Special meetings of the Stockholders may be
called in the manner provided in the bylaws, including by the president or a
majority of the Board of Directors or a majority of the Independent Directors
(as defined in the Charter), and shall be called by the president of the
Corporation upon the written request of Stockholders holding in the aggregate at
least ten percent (10%) of the outstanding shares entitled to be cast at such
meeting. Upon receipt of a written request, either in person or by mail, stating
the purpose(s) of the meeting, the Corporation shall provide to all
Stockholders, within 10 days after receipt of this request, written notice,
either in person or by mail, of a meeting and the purpose of such meeting to be
held on a date no less than 15 nor more than 60 days after the distribution of
such notice, at


                                       22



a time and place specified in the request, or if none is specified, at a time
and place convenient to the Stockholders. If there are no Directors, the
officers of the Corporation shall promptly call a special meeting of the
Stockholders entitled to vote for the election of successor Directors.

          (c) All Meetings. At any meeting of the Stockholders, each Stockholder
is entitled to one vote for each share owned of record on the applicable record
date. The presence in person or by proxy of a majority of the outstanding shares
entitled to be cast at the meeting constitutes a quorum, and the majority of all
the votes cast at the meeting by the Stockholders is sufficient to approve any
matter which properly comes before the meeting.

     Section 8.2 Extraordinary Actions. Except as otherwise expressly provided
in the Corporation's Charter and notwithstanding any provision of law permitting
or requiring any action to be taken or authorized by the affirmative vote of the
holders of a greater number of votes, any Stockholder action shall be effective
and valid if approved by the affirmative vote of holders of Shares representing
a majority of all the Shares entitled to vote on the matter; provided, however,
that any such transaction involving an Affiliate of the Corporation or the
Advisor also must be approved by a majority of the Directors (including a
majority of the Independent Directors) not otherwise interested in such
transaction as fair and reasonable to the Corporation and on terms and
conditions not less favorable to the Corporation than those available from
unaffiliated third parties.

     Section 8.3 Action By Stockholders Without a Meeting. Actions required or
permitted to be taken by the Stockholders may be taken without a meeting of the
Stockholders only by unanimous written consent, except to the extent that the
rights of any class or series of shares of Preferred Stock permit actions by the
holders of such shares of Preferred Stock by written consent.

     Section 8.4 Voting Limitations on Shares Held by the Advisor, Directors and
Affiliates. With respect to Shares owned by the Advisor, Directors other than
Independent Directors or any of their respective Affiliates, neither the
Advisor, such non-Independent Directors, nor any of their respective Affiliates
may vote or consent on matters submitted to the Stockholders regarding the
removal of the Advisor (to the extent that the Stockholders are permitted to
vote on such matter under to the Advisory Agreement), any non-Independent
Director or any transaction between the Corporation and the Advisor, any
non-Independent Director or any of their respective Affiliates. With respect to
Shares owned by any Independent Director, such Independent Director (or any of
his or her Affiliates) may not vote or consent on matters submitted to the
Stockholders regarding the removal of such Independent Director or any
transaction between the Corporation and such Director (or any of his or her
Affiliates). In determining the requisite percentage in interest of Shares
necessary to approve a matter on which the Advisor, any Director and any of
their respective Affiliates may not vote or consent, any Shares owned by any of
them shall not be included.

     Section 8.5 Right of Inspection. Any Stockholder and any designated
representative thereof shall be permitted reasonable access to all corporate
records of the Corporation at and during reasonable times, and may inspect and
copy any of them. Inspection of the Corporation's


                                       23



books and records by the office or agency administering the securities laws of a
jurisdiction shall be provided upon reasonable notice and during normal business
hours.

     Section 8.6 Access to Stockholder List.

          (a) An alphabetical list of the names, addresses and telephone numbers
of the Stockholders of the Corporation, along with the number of Shares held by
each of them (the "Stockholder List"), shall be maintained as part of the books
and records of the Corporation and shall be available for inspection by any
Stockholder or the Stockholder's designated agent at the home office of the
Corporation upon the request of the Stockholder. The Stockholder List shall be
updated at least quarterly to reflect changes in the information contained
therein. A copy of the Stockholder List shall be mailed to any Stockholder so
requesting within ten days of the receipt by the Corporation of the request. The
copy of the Stockholder List mailed to the requesting Stockholder shall be
printed in alphabetical order, on white paper, and in a readily readable type
size (in no event smaller than 10-point type). The Corporation may impose a
reasonable charge on the requesting Stockholder for expenses incurred in
reproduction pursuant to the Stockholder request. A Stockholder may request a
copy of the Stockholder List in connection with matters relating to
Stockholder's voting rights, and the exercise of Stockholder rights under
federal proxy laws.

          (b) If the Advisor or the Directors neglect or refuse to exhibit,
produce or mail a copy of the Stockholder List as requested, the Advisor and
such Directors shall be liable to any Stockholder requesting the list for the
costs, including attorney's fees, incurred by that Stockholder for compelling
the production of the Stockholder List, and for actual damages suffered by any
Stockholder by reason of such refusal or neglect. It shall be a defense that the
actual purpose and reason for the requests for inspection or for a copy of the
Stockholder List is to secure such list of Stockholders or other information for
the purpose of selling such list or copies thereof, or for the purpose of using
the Stockholder List for a commercial purpose other than in the interest of the
applicant as a Stockholder relative to the affairs of the Corporation. The
Corporation may require the Stockholder requesting the Stockholder List to
represent that the list is not requested for a commercial purpose unrelated to
the Stockholder's interest in the Corporation. The remedies provided hereunder
to Stockholders requesting copies of the Stockholder List are in addition to and
shall not in any way limit other remedies available to Stockholders under
federal law, or the laws of any state.

     Section 8.7 Reports. The Directors, including the Independent Directors,
shall take reasonable steps to ensure that the Corporation shall cause to be
prepared and mailed or delivered to each Stockholder as of a record date after
the end of the fiscal year and each holder of other publicly-held Securities of
the Corporation within 120 days after the end of the fiscal year to which it
relates an annual report for each fiscal year ending after the date of the
initial public offering of the Shares. Such annual report shall include: (a)
financial statements prepared in accordance with generally accepted accounting
principles which are audited and reported on by independent certified public
accountants; (b) the ratio of the costs of raising capital during the period to
the capital raised; (c) the aggregate amount of advisory fees and the aggregate
amount of other fees paid to the Advisor and any Affiliate of the Advisor by the
Corporation and including fees or charges paid to the Advisor and any Affiliate
of the Advisor by third parties in


                                       24



connection with the operation of the Corporation by such third parties; (d) the
Operating Expenses of the Corporation, stated as a percentage of Average
Invested Assets and as a percentage of its Net Income; (e) a report from the
Independent Directors that the policies being followed by the Corporation are in
the best interests of its Stockholders and the basis for such determination; (f)
separately stated, full disclosure of all material terms, factors, and
circumstances surrounding any and all transactions between the Corporation and
one or more Directors, the Advisor, the Sponsor or any Affiliate thereof
occurring in the year for which the annual report is made, and the Independent
Directors shall be specifically charged with a duty to examine and comment in
the report on the fairness of such transactions; and (g) all Dividends paid to
the Stockholders for the period.

                                   ARTICLE IX

                                     ADVISOR

     Section 9.1 Appointment of Advisor. The Board of Directors is responsible
for setting the general policies of the Corporation and for the general
supervision of its business conducted by officers, agents, employees, advisors
or independent contractors of the Corporation. However, the Board of Directors
is not required personally to conduct the business of the Corporation, and it
may (but need not) appoint, employ or contract with any Person (including a
Person Affiliated with any director) as an Advisor and may grant or delegate
such authority to the Advisor as the Board of Directors may, in its sole
discretion, deem necessary or desirable. The term of retention of any Advisor
shall not exceed one year, although there is no limit to the number of times
that a particular Advisor may be retained.

     Section 9.2 Supervision of the Advisor. The Board of Directors shall
evaluate the performance of the Advisor before entering into or renewing an
Advisory Agreement, and the criteria used in such evaluation shall be reflected
in the minutes of the meetings of the board of directors. The Board of Directors
may exercise broad discretion in allowing the Advisor to administer and regulate
the operations of the Corporation, to act as agent for the Corporation, to
execute documents on behalf of the Corporation and to make executive decisions
that conform to general policies and principles established by the Board of
Directors. The Board of Directors, including a majority of the Independent
Directors, shall determine at least annually that the expenses incurred by the
Corporation are reasonable in light of the investment performance of the
Corporation, its Net Assets, its Net Income and the fees and expenses of other
comparable unaffiliated REITs. Each such determination shall be reflected in the
minutes of the meetings of the Board of Directors. The Board of Directors,
including a majority of the Independent Directors, shall determine from time to
time and at least annually that the compensation to be paid to the Advisor is
reasonable in relation to the nature and quality of services performed and that
such compensation is within the limits prescribed by the Charter. The Board of
Directors, including a majority of the Independent Directors, shall also
supervise the performance of the Advisor and the compensation paid to the
Advisor by the Corporation to determine that the provisions of the Advisory
Agreement are being met. Each such determination shall be based on factors such
as (a) the amount of the fee paid to the Advisor in relation to the size,
composition and performance of the Corporation's portfolio; (b) the success of
the Advisor in generating


                                       25



opportunities that meet the investment objectives of the Corporation; (c) rates
charged to other REITs and to investors other than REITs by advisors performing
the same or similar services; (d) additional revenues realized by the Advisor
and its Affiliates through their relationship with the Corporation, including
loan administration, underwriting or broker commissions, servicing, engineering,
inspection and other fees, whether paid by the Corporation or by others with
whom the Corporation does business; (e) the quality and extent of service and
advice furnished by the Advisor; (f) the performance of the Corporation's
portfolio, including income, conservation or appreciation of capital, frequency
of problem investments and competence in dealing with distress situations; and
(g) the quality of the Corporation's portfolio relative to the investments
generated by the Advisor for its own account. The Board of Directors, including
a majority of the Independent Directors, may also consider all other factors
that it deems relevant, and its findings on each of the factors considered shall
be recorded in the minutes of the Board of Directors. The Board of Directors
shall determine whether any successor Advisor possesses sufficient
qualifications to perform the advisory function for the Corporation and whether
the compensation provided for in its contract with the Corporation is justified.

     Section 9.3 Fiduciary Obligations. The Advisor shall have a fiduciary
responsibility and duty to the Corporation and its stockholders.

     Section 9.4 Termination. Either a majority of the Independent Directors or
the Advisor may terminate the Advisory Agreement on 60 days' written notice
without cause or penalty, and, in such event, the Advisor will cooperate with
the Corporation and the board of directors in making an orderly transition of
the advisory function.

     Section 9.5 Disposition Fee. Unless otherwise provided in any resolutions
adopted by the board of directors, if the Advisor or its Affiliates or a
director or Sponsor provides a substantial amount of the services, as determined
by the Corporation's Independent Directors, in the effort to sell any real
estate-related investments of the Corporation, that Person may receive 3% of the
sales price of such real estate-related investments. In the case of the sale of
any real estate asset other than real estate-related investments, that Person
may receive an amount equal to the lesser of (a) one-half of the Competitive
Real Estate Commission paid up to 3% of the contract sales price (such amount,
when added to the sums paid to unaffiliated parties, shall not exceed the lesser
of the Competitive Real Estate Commission or 6% of the contracted sales price)
or if none is paid, the amount that customarily would be paid, or (b) 3% of the
contract purchase price of each property sold.

     Section 9.6 Incentive Fees. Unless otherwise provided in any resolutions
adopted by the Board of Directors, the Corporation may pay the Advisor an
interest in the gain from the sale of properties, for which full consideration
is not paid in cash or property of equivalent value, provided the amount or
percentage of such interest is reasonable. Such an interest in gain from the
sale of properties shall be considered presumptively reasonable if it does not
exceed 15% of the balance of such net proceeds remaining after payment to
stockholders, in the aggregate, of an amount equal to 100% of the Invested
Capital, plus an amount equal to at least six percent of the Invested Capital
per annum cumulative. In the case of multiple Advisors, such Advisor and any of
their Affiliates shall be allowed such fees provided such fees are distributed
by a proportional


                                       26



method reasonably designed to reflect the value added to the Corporation assets
by each respective Advisor or any Affiliate.

     Section 9.7 Organizational and Offering Expenses Limitation. Unless
otherwise provided in any resolutions adopted by the Board of Directors, the
Corporation shall reimburse the Advisor and its Affiliates for Organizational
and Offering Expenses incurred by the Advisor or its Affiliates; provided,
however, that the total amount of all Organizational and Offering Expenses shall
be reasonable and shall in no event exceed 15% of the Gross Proceeds of the
offering.

     Section 9.8 Real Estate Commissions or Acquisition Fees. Unless otherwise
provided in any resolutions adopted by the board of directors, the total of all
Real Estate Commissions or Acquisition Fees and Acquisition Expenses shall be
reasonable and shall not exceed an amount equal to 6% of the Contract Purchase
Price; provided, however, that the majority of the Independent Directors may
approve fees and expenses in excess of this limit if they determine the
transaction to be commercially competitive, fair and reasonable to the
Corporation.

     Section 9.9 Reimbursement for Total Operating Expenses. Unless otherwise
provided in any resolutions adopted by the Board of Directors, the Corporation
may reimburse the Advisor, at the end of each fiscal quarter, for Total
Operating Expenses incurred by the Advisor; provided, however, that the
Corporation shall not reimburse the Advisor at the end of any fiscal quarter for
Total Operating Expenses that, in the four consecutive fiscal quarters then
ended, exceed the greater of 2% of Average Invested Assets or 25% of Net Income
(the "2%/25% Guidelines") for such years. The Independent Directors shall have
the responsibility of limiting Total Operating Expenses to amounts that do not
exceed the 2%/25% Guidelines unless they have made a finding that, based on such
unusual and non-recurring factors that they deem sufficient, a higher level of
expenses (an "Excess Amount") is justified. Any such finding and the reasons in
support thereof shall be reflected in the minutes of the meetings. Within 60
days after the end of any fiscal quarter of the Corporation for which there is
an Excess Amount for the 12 months then ended that the Independent Directors
concludes was justified and reimbursable to the Advisor, there shall be sent to
the Common Stockholders a written disclosure of such fact, together with an
explanation of the factors the Independent Directors considered in determining
that such Excess Amount was justified. In the event that the Independent
Directors do not determine that excess expenses are justified, the Advisor shall
reimburse the Corporation at the end of the 12-month period the amount by which
the aggregate annual expenses paid or incurred by the Corporation exceeded the
2%/25% Guidelines.

                                    ARTICLE X

                      INVESTMENT OBJECTIVES AND LIMITATIONS

     Section 10.1. Investment Objectives and Policies. The Corporation's primary
investment objectives are: (a) to preserve, protect and return the invested
capital of the Stockholders; (b) to realize capital appreciation upon the sale
of the Real Estate Assets; (c) to provide periodic dividends; and (d) to provide
Stockholders with liquidity of their investment by listing the shares on a
national securities exchange within ten (10) years or if Listing does not occur
within ten


                                       27



years following the commencement of the Initial Public Offering, by selling the
Real Estate Assets and distributing the cash to the Stockholders. The sheltering
from tax of income from other sources is not an objective of the Corporation.
Subject to the restrictions set forth herein, the Board of Directors shall cause
the Corporation to take all actions necessary or desirable (in the sole and
absolute discretion of the Board of Directors) to allow the Corporation to
continue to meet the REIT Requirements; provided, however, no Director, officer,
employee or agent of the Corporation, including the Advisor, shall be liable for
any act or omission resulting in the loss of tax benefits under the Code, except
to the extent provided in Section 12.3. The Board of Directors shall establish
written policies on investments and borrowing and shall monitor the
administrative procedures, investment operations and performance of the
Corporation and the Advisor to assure that such policies are carried out.

     Section 10.2. Review of Objectives. The Independent Directors shall review
the investment and borrowing policies of the Corporation with sufficient
frequency and at least annually to determine that the policies being followed by
the Corporation at any time are in the best interests of its Stockholders. Each
such determination and the basis therefor shall be set forth in the minutes of
the meetings of the Board of Directors.

     Section 10.3. Certain Permitted Investments. Subject to any limitations in
Section 10.4 and Article XI, the Corporation may invest in:

          (a) Real Estate Assets;

          (b) short-term investments, including government obligations, bank
certificates of deposit, short-term debt obligations and interest-bearing
accounts or other authorized short-term investments as determined by the Board
of Directors;

          (c) mortgage loans and mortgage securities, if a majority of Directors
(including a majority of Independent Directors) not otherwise interested in the
transaction approve such investment as being fair, competitive and commercially
reasonable to the Corporation; and

          (d) joint ventures with the Sponsor, the Advisor, one or more
Directors or any Affiliate of any such Person, only if a majority of Directors
(including a majority of Independent Directors) not otherwise interested in the
transaction (i) approve such investment as being fair and reasonable to the
Corporation, and (ii) determine that the investment by the Corporation and other
third party investors making a comparable investment in the joint venture are on
substantially the same terms and conditions.

     Section 10.4. Investment Limitations. In addition to other investment
restrictions imposed by the Board of Directors from time to time, consistent
with the Corporation's objective of qualifying as a REIT, the following
limitations shall apply to the Corporation's investments and to the conduct of
the Corporation's business:

          (a) The Corporation shall not invest in commodities or commodity
futures contracts. This limitation is not intended to apply to futures
contracts, when used solely for


                                       28



hedging purposes in connection with the Corporation's ordinary business of
investing in Real Estate Assets and mortgages.

          (b) The Corporation shall not invest in or make mortgage loans unless
an appraisal is obtained concerning the underlying property except for those
loans insured or guaranteed by a government or government agency. In cases in
which a majority of Independent Directors so determine, and in all cases in
which the transaction is with the Advisor, Directors, Sponsor or any Affiliates
thereof, such appraisal of the underlying property must be obtained from an
Independent Expert. Such appraisal shall be maintained in the Corporation's
records for at least five years and shall be available for inspection and
duplication by any Stockholder. In addition to the appraisal, a mortgagee's or
owner's title insurance policy or commitment as to the priority of the mortgage
or condition of the title must be obtained.

          (c) The Corporation shall not make or invest in mortgage loans,
including construction loans, on any one Real Estate Asset if the aggregate
amount of all mortgage loans outstanding on the Real Estate Asset, including the
loans of the Corporation, would exceed an amount equal to 80% of the appraised
value of the Real Estate Asset as determined by appraisal unless substantial
justification exists because of the presence of other underwriting criteria. For
purposes of this subsection, the "aggregate amount of all mortgage loans
outstanding on the Real Estate Asset, including the loans of the Corporation"
shall include all interest (excluding contingent participation in income and/or
appreciation in value of the mortgaged Real Estate Asset), the current payment
of which may be deferred pursuant to the terms of such loans, to the extent that
deferred interest on each loan exceeds 5% per annum of the principal balance of
the loan.

          (d) The Corporation shall not make or invest in any mortgage loans
that are subordinate to any mortgage, other indebtedness or equity interest of
the Advisor, the Directors, the Sponsor or any of their respective Affiliates.

          (e) The Corporation shall not invest in indebtedness ("Junior Debt")
secured by a mortgage on real property which is subordinate to any lien for
other indebtedness ("Senior Debt"), except where such amount of such Junior
Debt, plus the outstanding amount of Senior Debt, does not exceed 80% of the
appraised value of such property, if after giving effect thereto, the value of
all such mortgage loans of the Corporation (as shown on the books of the
Corporation in accordance with generally accepted accounting principles, after
all reasonable reserves but before provision for depreciation) would not then
exceed 25% of the Corporation's Net Assets.

          (f) The aggregate Leverage of the Corporation shall be reasonable in
relation to the Net Assets of the Corporation and shall be reviewed by the Board
of Directors at least quarterly. The Corporation shall not incur (or enter into
an agreement to incur) indebtedness if the incurrence thereof would cause the
Corporation's Leverage to exceed 65% of the aggregate value of the Real Estate
Assets unless approved by the Independent Directors and disclosed to the
Stockholders in the next quarterly report of the Corporation; provided, that
Leverage on individual Real Estate Assets may exceed such limit.


                                       29



          (g) The Corporation shall not underwrite the Securities of other
issuers. In addition, except for investments in Real Estate Assets and
short-term investments of the type described in Section 10.3(b), the Corporation
shall not invest in Securities of other issuers other than the Operating
Partnership, unless a majority of the Directors (including a majority of
Independent Directors) not otherwise interested in such transaction approve the
transaction as being fair, competitive and commercially reasonable. In addition,
the Corporation shall not invest in any security of any entity holding
investments or engaging in activities prohibited by the Corporation's Charter.

          (h) The Corporation shall not issue (A) equity securities redeemable
solely at the option of the holder; (B) non-voting or assessable securities; or
(C) options, warrants, or similar evidences of a right to buy the Corporation's
securities (collectively, "Options") unless (1) issued to all of its
Stockholders ratably, (2) as part of a financing arrangement, or (3) as part of
a stock option plan available to Directors, officers or employees of the
Corporation, the Sponsor or the Advisor. Options may not be issued to the
Advisor, the Directors, the Sponsor or any Affiliate thereof except on the same
terms as such Options are sold to the general public, when applicable. Options
may be issued to persons other than the Advisor, Directors, Sponsor or any
Affiliate thereof but not at exercise prices less than the fair market value of
the underlying securities on the date of grant and not for consideration (which
may include services) that in the judgment of the Independent Directors has a
market value less than the value of such Option on the date of grant. Options
issuable to the Advisor, Directors, Sponsor or any Affiliate thereof shall not
exceed 10% of the outstanding Shares on the date of grant of any such Options.
The voting rights per share of Shares (other than publicly held shares of Common
Stock) sold in a private offering shall not exceed the voting rights that bear
the same relationship to the voting rights of the publicly held shares of Common
Stock as the consideration paid to the Corporation for each privately offered
Share bears to the book value of each outstanding publicly offered shares of
Common Stock.

          (i) The consideration paid for real property acquired by the
Corporation shall be based on the fair market value of the property as
determined by a majority of the Directors. If any Real Estate Asset is acquired
from an Affiliated Seller, or if a majority of the Independent Directors
determine that a third-party appraisal is necessary to determine the fair market
value of any other Real Estate Asset to be acquired by the Corporation, the
Corporation shall engage an Independent Expert selected by the Independent
Directors to determine the fair market value of such Real Estate Asset.

          (j) The Corporation shall not operate so as to be classified as an
"investment company" under the Investment Corporation Act of 1940, as amended.

          (k) The Corporation shall not issue debt securities unless the
historical debt service coverage (in the most recently completed fiscal year) as
adjusted for known changes is sufficient to properly service that higher level
of debt;

          (l) The Corporation shall not issue Shares on a deferred payment basis
or under similar arrangements.


                                       30



          (m) The Corporation shall not invest in equity securities (other than
OP Units and short term investments) unless a majority of the Directors
(including a majority of the Independent Directors) not otherwise interested in
such transaction approves the transaction as being fair, competitive and
commercially reasonable.

          (n) The Corporation shall not invest in real estate contracts of sale,
otherwise known as land sale contracts, unless such contracts of sale are in
recordable form and appropriately recorded in the chain of title.

The foregoing investment limitations may not be modified or eliminated without
the approval of Stockholders owning a majority of the outstanding Shares.

                                   ARTICLE XI

                              CONFLICTS OF INTEREST

     Section 11.1 Sales and Leases to the Corporation. The Corporation may
purchase or lease a property or properties from the Sponsor, the Advisor, a
director, or any Affiliate thereof upon a finding by a majority of Independent
Directors (including a majority of Independent Directors) not otherwise
interested in the transaction that such transaction is fair and reasonable to
the Corporation and at a price to the Corporation no greater than the cost of
the property to such Sponsor, Advisor, Director or Affiliate, or, if the price
to the Corporation is in excess of such cost, that substantial justification for
such excess exists and such excess is reasonable. In no event shall the purchase
price of any property to the Corporation exceed its current appraised value.

     Section 11.2 Sales and Leases to the Sponsor, Advisor, Directors or
Affiliates. An Advisor, Sponsor, director or Affiliate thereof may purchase or
lease properties from the Corporation if a majority of Independent Directors
(including a majority of Independent Directors) not otherwise interested in the
transaction determine that the transaction is fair and reasonable to the
Corporation.

     Section 11.3 Other Transactions.

          (a) No goods or services will be provided by the Advisor or its
Affiliates to the Corporation unless a majority of the Independent Directors not
otherwise interested in such transaction approve such transaction as fair and
reasonable to the Corporation and on terms and conditions not less favorable to
the Corporation than those available from unaffiliated third parties.

          (b) The Corporation shall not make loans to the Sponsor, Advisor,
Directors or any Affiliates thereof except loans to wholly owned subsidiaries of
the Corporation. The Sponsor, Advisor, directors and any Affiliates thereof
shall not make loans to the Corporation, or to joint ventures in which the
Corporation is a co-venturer, unless approved by a majority of the Directors
(including a majority of the Independent Directors) not otherwise interested in
such


                                       31



transaction as fair, competitive and commercially reasonable, and no less
favorable to the Corporation than comparable loans between unaffiliated parties.

                                   ARTICLE XII

                      LIABILITY LIMITATION, INDEMNIFICATION

     Section 12.1. Limitation of Stockholder Liability. No Stockholder shall be
liable for any debt, claim, demand, judgment or obligation of any kind of,
against or with respect to the Corporation by reason of being a Stockholder, nor
shall any Stockholder be subject to any personal liability whatsoever, in tort,
contract or otherwise, to any person in connection with the property or the
affairs of the Corporation by reason of being a Stockholder.

     Section 12.2. Limitation of Liability of Directors and Officers. To the
maximum extent permitted by Maryland law in effect from time to time, no
director of officer of the Corporation shall be liable to the Corporation or the
Stockholders for money damages. Neither the amendment or repeal of this Section
12.2, nor the adoption or amendment of any other provision of the Corporation's
Charter or the Bylaws inconsistent with this Section 12.2 shall apply to or
affect in any respect the applicability of the preceding sentence with respect
to any act or omission that occurred prior to such amendment, repeal or
adoption.

     Section 12.3. Indemnification.

          (a) Definitions. In this Section 12.3:

               (i) " Indemnitee" means (1) any present or former Director or
officer of the Corporation, (2) any person who while serving in any of the
capacities referred to in clause (1) hereof served at the Corporation's request
as a director, trustee, partner or officer of another corporation, partnership,
joint venture, trust, employee benefit plan or other enterprise, (3) any person
nominated or designated by (or pursuant to authority granted by) the Directors
or any committee thereof to serve in any of the capacities referred to in
clauses (1) or (2) hereof, and (4) the Advisor and any Affiliate of the Advisor.

               (ii) "Proceeding" means any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative, arbitrative
or investigative, any appeal in such an action, suit or proceeding, and any
inquiry or investigation that could lead to such an action, suit or proceeding.

          (b) Indemnification. The Corporation shall indemnify every Indemnitee
against all judgments, penalties (including excise and similar taxes), fines,
amounts paid in settlement and reasonable expenses (including court costs and
attorneys' fees) actually incurred by the Indemnitee in connection with any
Proceeding in which he or she was, is or is threatened to be named defendant or
respondent, or in which he or she was or is a witness without being named a
defendant or respondent, by reason, in whole or in part, of his or her serving
or having served, or having been nominated or designated to serve, in any of the
capacities referred to in Section 12.3(a)(i), to the fullest extent that
indemnification is permitted by the MGCL as the same exists


                                       32



or may hereafter be amended (but, in the case of any such amendment, only to the
extent that such amendment permits the Corporation to provide broader
indemnification rights than the law permitted the Corporation to provide prior
to such amendment) or any other applicable laws presently or hereinafter in
effect, provided that the Corporation shall not indemnify or hold harmless the
Indemnitee if: (1) in the case of any Indemnitee other than an Independent
Director, the loss or liability was the result of negligence or misconduct by
the Indemnitee, or (2) in the case that the Indemnitee is an Independent
Director, the loss or liability was the result of gross negligence or willful
misconduct by the Indemnitee. Notwithstanding anything to the contrary in this
Section 12.3, prior to any Listing:

               (i) the Corporation will not indemnify any Indemnitee unless (A)
the Indemnitee has determined in good faith that the course of conduct which
caused the loss, liability or expense was in the best interests of the
Corporation, and (B) the Indemnitee was acting on behalf of the Corporation or
performing services for the Corporation; and

               (ii) the Corporation will not indemnify any Indemnitee for
losses, liabilities or expenses arising from or out of an alleged violation of
federal or state securities laws unless (A) each claim or count involving
alleged violations of federal or state securities has been adjudicated in favor
of the Indemnitee, (B) each such claim or count has been dismissed with
prejudice by a court of competent jurisdiction, or (C) a court of competent
jurisdiction approves a settlement of each such claim or count and finds that
indemnification of the settlement and related costs should be made, and the
court considering the matter has been advised of the position of the Securities
and Exchange Commission and the published position of any applicable state
securities regulatory authority as to indemnification for securities law
violations.

Any indemnification of expenses or agreement to hold harmless may be paid only
out of the Net Assets of the Corporation and no portion may be recoverable from
the Stockholders. An Indemnitee shall be deemed to have been found liable in
respect of any claim, issue or matter only after the Indemnitee shall have been
so adjudged by a court of competent jurisdiction after exhaustion of all appeals
therefrom.

          (c) Advancement of Expenses. The Corporation shall pay or reimburse
reasonable legal expenses and other costs incurred by an Indemnitee in advance
of final disposition of a Proceeding if all of the following conditions are
satisfied: (a) the Proceeding relates to acts or omissions with respect to the
performance of duties or services on behalf of the Corporation, (b) the
Indemnitee provides the Corporation with written affirmation of the Indemnitee's
good faith belief that the Indemnitee has met the standard of conduct necessary
for indemnification by the Corporation as authorized by this Section 12.3, (c)
either (i) the Proceeding was initiated by a third party who is not a
Stockholder, or (ii) if the Proceeding was initiated by a Stockholder, either
the initiating Stockholder was acting in his or her capacity as such and the
advancement was approved by a court of competent jurisdiction, and (d) the
Indemnitee provides the Corporation with a written undertaking to repay the
amount paid or reimbursed by the Corporation, together with the applicable legal
rate of interest thereon, if it is ultimately determined that the Indemnitee did
not comply with the requisite standard of conduct and is not entitled to
indemnification. Any indemnification payment or reimbursement of


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expenses will be furnished in accordance with the procedures in Section 2-418(e)
of the MGCL or any successor statute.

                                  ARTICLE XIII

                                   AMENDMENTS

     Section 13.1 Amendment. Subject to the terms of the Corporation's Charter,
the Corporation reserves the right from time to time to make any amendment to
its Charter, now or hereafter authorized by law. All rights and powers conferred
by the Corporation's Charter on Stockholders, Directors and officers are granted
subject to this reservation. Except as otherwise provided in the Corporation's
Charter, and to the extent otherwise permitted by MGCL, any amendment to the
Corporation's Charter shall be valid only if approved by resolution of a
majority of the Directors and by the affirmative vote of a majority of all votes
entitled to be cast on the matter; provided, however, that no amendment ARTICLE
VI, Section 6.1(f) of the Charter may be made unless approved by the affirmative
vote of two-thirds of all votes entitled to be cast on the matter.

                                   ARTICLE XIV

                           EXTRAORDINARY TRANSACTIONS

     Section 14.1 Authority of Directors. Subject to the provisions of any class
or series of Shares at the time outstanding, the Board of Directors shall have
the power to:

          (a) merge the Corporation into another entity or otherwise cause a
reorganization of the Corporation;

          (b) consolidate the Corporation with one or more other entities into a
new entity;

          (c) sell or otherwise dispose of all or substantially all of the
Corporation's assets; or

          (d) dissolve or liquidate the Corporation;

provided, however, that such action shall have been approved, at a meeting of
the Stockholders called for that purpose, by the affirmative vote of the holders
of not less than a majority of the votes entitled to be cast on the matter. Any
such transaction involving an Affiliate of the Corporation or the Advisor also
must be approved by a majority of the Directors (including a majority of the
Independent Directors) not otherwise interested in such transaction as fair and
reasonable to the Corporation and on terms and conditions not less favorable to
the Corporation than those available from unaffiliated third parties. For
purposes of this Section 14.1, the term "reorganization" means a reorganization
of the Corporation of the type that would require an amendment to the
Corporation's Charter (other than an amendment that would not require
shareholder approval pursuant to Article XIII hereof).


                                       34



     Section 14.2 Roll-Up Transactions.

          (a) In connection with any proposed Roll-Up Transaction, an appraisal
of all of the Corporation's assets shall be obtained from an Independent Expert.
The Corporation's assets shall be appraised on a consistent basis, and the
appraisal shall be based on the evaluation of all relevant information and shall
indicate the value of the Corporation's assets as of a date immediately prior to
the announcement of the proposed Roll-Up Transaction. The appraisal shall assume
an orderly liquidation of the Corporation's assets over a 12-month period. The
terms of the engagement of the Independent Expert shall clearly state that the
engagement is for the benefit of the Corporation and the Stockholders. A summary
of the appraisal, indicating all material assumptions underlying the appraisal,
shall be included in a report to Stockholders in connection with a proposed
Roll-Up Transaction. In connection with a proposed Roll-Up Transaction, the
Person sponsoring the Roll-Up Transaction shall offer to Stockholders who vote
against the proposed Roll-Up Transaction the choice of:

               (i) accepting the securities of a Roll-Up Entity offered in the
proposed Roll-Up Transaction; or

               (ii) one of the following:

                    (1) remaining as Stockholders of the Corporation and
preserving their interests therein on the same terms and conditions as existed
previously; or

                    (2) receiving cash in an amount equal to the Stockholder's
pro rata share of the appraised value of the Net Assets of the Corporation.

          (b) The Corporation is prohibited from participating in any proposed
Roll-Up Transaction:

               (i) that would result in the Stockholders having voting and other
rights in a Roll-Up Entity that are less than the rights provided for in
Sections 8.1, 8.2, 8.5, 8.6, 8.7 and 12.1;

               (ii) that includes provisions that would operate to materially
impede or frustrate the accumulation of shares by any purchaser of the
securities of the Roll-Up Entity (except to the minimum extent necessary to
preserve the tax status of the Roll-Up Entity), or that would limit the ability
of an investor to exercise the voting rights of its Securities of the Roll-Up
Entity on the basis of the number of Shares held by that investor;

               (iii) in which investor's rights to access of records of the
Roll-Up Entity will be less than those described in Sections 8.5 and 8.6; or

               (iv) in which any of the costs of the Roll-Up Transaction would
be borne by the Corporation if the Roll-Up Transaction is not approved by the
Stockholders.


                                       35



                                   ARTICLE XV

                             DURATION OF THE COMPANY

     Section 15.1. Term. Subject to Section 14.1 if, before [___, 2017] the
Initial Public Offering the Corporation's Common Stock is not Listed on a
national securities exchange or quoted on a national market system or the
Corporation has not merged with an entity whose shares are so listed or quoted,
the Corporation shall submit for a vote of the Stockholders at the next annual
meeting a proposal to liquidate all of the Real Estate Assets in an orderly
fashion and distribute the net proceeds to the Stockholders.

                                      * * *

          THIRD: The amendment to and restatement of the Charter as hereinabove
set forth have been duly advised by the Board of Directors and approved by the
stockholders of the Corporation as required by law.

          FOURTH: The current address of the principal office of the Corporation
is as set forth in Article IV of the foregoing amendment and restatement of the
Charter.

          FIFTH: The name and address of the Corporation's current resident
agent is as set forth in Article IV of the foregoing amendment and restatement
of the Charter.

          SIXTH: The number of directors of the Corporation and the names of
those currently in office are as set forth in Article V of the foregoing
amendment and restatement of the Charter.

          SEVENTH: The undersigned President acknowledges these Articles of
Amendment and Restatement to be the corporate act of the Corporation and as to
all matters or facts required to be verified under oath, the undersigned
President acknowledges that to the best of his knowledge, information and
belief, these matters and facts are true in all material respects and that this
statement is made under the penalties for perjury.


                                       36



          IN WITNESS WHEREOF, the Corporation has caused these Articles of
Amendment and Restatement to be signed in its name and on its behalf by its
President and attested to by its Secretary on this __ day of _______, 2007.

                                        SHOPOFF PROPERTIES TRUST, INC.


                                        By:
                                            ------------------------------------
                                            President


ATTEST:


-------------------------------------
Secretary


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