What changed in this filing

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Item 1A. Risk Factors

2021-03-31 compared with 2020-03-26 · 106 added, 91 removed, 451 unchanged (30% of the section changed)

38 unchanged sentences

While we believe that we will be able to raise the capital we need to continue our

operations, there can be no assurances that we will be successful in these efforts or will be able to resolve our liquidity issues

operations, there can be no assurances that we will be successful in these efforts or will be able to resolve any liquidity issues

or eliminate our operating losses.

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If we are unable to obtain additional funds

or credit from our vendors, we will be unable to execute our business plan and you could lose your investment.

or credit from our vendors, we may be unable to execute our business plan and you could lose your investment.

we may be unable to identify and or successfully acquire properties which are suitable for our business, our financial condition

may be negatively affected.

business plan involves the identification and the successful acquisition of properties, which are zoned for medical marijuana

businesses, including cultivation and retail.

business plan involves the identification and the successful acquisition of properties, which are zoned for medical cannabis businesses,

including cultivation and retail.

The properties we acquire will be leased to regulated cannabis operators.

governments must approve and adopt zoning ordinances for medical marijuana facilities and retail dispensaries.

A lack of properly

zoned real estate may reduce our prospects and limit our opportunity for growth and or increase the cost at which suitable properties

are available to us.

Conversely a surplus of real estate zoned for medical marijuana establishments may reduce demand and prices

we are able to charge for properties we may have previously acquired.

addition, some jurisdictions, such as Arizona, impose limits on the number of medical marijuana dispensaries that will be permitted

Local governments

must approve and adopt zoning ordinances for medical cannabis facilities and retail dispensaries.

A lack of properly zoned real

estate may reduce our prospects and limit our opportunity for growth and or increase the cost at which suitable properties are

available to us.

Conversely a surplus of real estate zoned for medical cannabis establishments may reduce demand and prices we

are able to charge for properties we may have previously acquired.

addition, some jurisdictions, such as Arizona, impose limits on the number of medical cannabis dispensaries that will be permitted

to operate within designated geographic areas.

Such limitations inherently place constraints on the number of properties we acquire

for lease to operators in the marijuana industry.

we fail to diversify our property portfolio, downturns relating to certain industries or business sectors or the financial stability

of our related party tenants may have a significant adverse impact on our assets and our ability to pay our operating expenses

or pay dividends than if we had a diversified property portfolio.

for lease to operators in the cannabis industry.

we fail to diversify our property portfolio or advisory and real estate services offered, downturns relating to certain industries

or business sectors or the financial stability of our significant tenants may have a significant adverse impact on our assets

and our ability to pay our operating expenses or pay dividends than if we had a diversified property portfolio and service offerings.

we intend to diversify our portfolio of properties, we are not required to observe specific diversification criteria.

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We believe that the pharmaceutical industry clearly does not want to cede control of any product that could generate significant

For example, medical marijuana will likely adversely impact the existing market for the current “marijuana pill”

sold by the mainstream pharmaceutical industry, should marijuana displace other drugs or encroach upon the pharmaceutical industry’s

For example, medical cannabis will likely adversely impact the existing market for the current “marijuana pill”

sold by the mainstream pharmaceutical industry, should cannabis displace other drugs or encroach upon the pharmaceutical industry’s

The pharmaceutical industry is well funded with a strong and experienced lobby that eclipses the funding of the medical

marijuana movement.

cannabis movement.

Any inroads the pharmaceutical could make in halting the impending cannabis industry could have a detrimental

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has not yet returned to its pre-2008 state.

The cannabis sector experienced significant volatility in 2019 and such volatility

has continued in 2020.

The cannabis sector experienced significant volatility in 2019 and 2020 and such volatility

is expected to continue in 2021.

Obtaining favorable financing in the current environment remains challenging.

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our tenants currently carry comprehensive insurance on our properties, including fire, liability and extended coverage insurance,

however, there are certain risks that may be uninsurable or not insurable on terms that management believes to be economical.

For example, management may not obtain insurance against floods, terrorism, mold-related claims, or earthquake insurance.

an event occurs to, or causes the damage or destruction of, a property, we could suffer financial losses.

there are certain risks that may be uninsurable or not insurable on terms that management believes to be economical.

management may not obtain insurance against floods, terrorism, mold-related claims, or earthquake insurance.

If such an event

occurs to, or causes the damage or destruction of, a property, we could suffer financial losses.

we are found non-compliance with the Americans with Disabilities Act, we will be subject to significant liabilities.

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results of operations could be adversely affected by general conditions in the global economy and in the global financial markets,

including conditions that are outside of our control, including the U.S.

presidential election and the impact of health and safety

concerns, such as those relating to the current COVID-19 outbreak.

The most recent global financial crisis caused extreme volatility

and disruptions in the capital and credit markets.

A severe or prolonged economic downturn could result in a variety of risks

to our business, including weakened demand for our properties and our ability to raise additional capital when needed on acceptable

terms, if at all.

A weak or declining economy could strain our tenants, possibly resulting in delays in tenant payments.

the foregoing could harm our business and we cannot anticipate all the ways in which the current economic climate and financial

market conditions could adversely impact our business.

including conditions that are outside of our control, including the impact of health and safety concerns, such as those relating

to the current COVID-19 outbreak.

The most recent global financial crisis caused extreme volatility and disruptions in the capital

and credit markets.

A severe or prolonged economic downturn could result in a variety of risks to our business, including weakened

demand for our properties and our ability to raise additional capital when needed on acceptable terms, if at all.

A weak or declining

economy could strain our tenants, possibly resulting in delays in tenant payments.

Any of the foregoing could harm our business

and we cannot anticipate all the ways in which the current economic climate and financial market conditions could adversely impact

our business.

will be required to attract and retain top quality talent to compete in the marketplace.

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Supreme Court has ruled in United States v.

Oakland Cannabis

Buyers’

Oakland Cannabis Buyers’

and Gonzales v.

Raich that it is the federal government that has the right to regulate and criminalize

marijuana, even for medical purposes.

We would likely be unable to execute our business plan if the federal government were to

strictly enforce federal law regarding marijuana.

Raich that it is the federal government that has the right to regulate and criminalize marijuana,

even for medical purposes.

We would likely be unable to execute our business plan if the federal government were to strictly enforce

federal law regarding marijuana.

January 4, 2018, then-U.S.

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nationwide guidance specific to marijuana is unnecessary and is rescinded, effective immediately.”

prosecutors appear to continue to use the Cole Memo’s priorities as an enforcement guide.

Attorney General Merrick Garland

has indicated that he would deprioritize enforcement of low-level cannabis crimes such as possession, and has shared his view

that the government should focus on large-scale criminal enterprises that circumvent state legalization laws instead of going

after people who abide by local cannabis policies.

The Company believes, however, it is too soon to determine what prosecutorial

effects will be created by the rescission of the Cole Memo or any replacement thereof and when or if the Sessions Memo will be

At this time, cannabis remains a Schedule I controlled substance at the federal level.

federal government

has always reserved the right to enforce federal law in regard to the sale and disbursement of medical or adult use cannabis,

even if state law authorizes such sale and disbursement.

It is unclear whether the risk of enforcement has been altered.

is unclear at this time what impact the Sessions Memo will have on the medical-use marijuana industry.

In addition, pursuant to

the current omnibus spending bill previously approved by Congress, the DOJ was prohibited from using funds appropriated by Congress

to prevent states from implementing their medical-use cannabis laws.

This provision, however, will expire on September 30, 2020.

There is no assurance that Congress will approve inclusion of a similar prohibition on DOJ spending in the appropriations bill

for future years.

Although we are not engaged in the purchase, sale, growth, cultivation, harvesting, or processing of medical-use

marijuana products, we lease our properties to tenants who engage in such activities, and therefore strict enforcement of federal

prohibitions regarding marijuana could irreparably harm our business, subject us to criminal prosecution and/or adversely affect

the trading price of our securities.

prosecutors have significant discretion and no assurance can be given that the federal prosecutor in each judicial district where

we own a property will not choose to strictly enforce the federal laws governing marijuana production or distribution.

in the federal government’s enforcement posture with respect to state-licensed cultivation of medical-use cannabis, including

the enforcement postures of individual federal prosecutors in judicial districts where we own or may purchase properties, would

result in our inability to execute our business plan, and we would likely suffer significant losses with respect to our investment

in marijuana facilities in the United States, which would adversely affect the trading price of our securities.

Furthermore, following

any such change in the federal government’s enforcement position, we could be subject to criminal prosecution, which could lead

to imprisonment and/or the imposition of penalties, fines, or forfeiture.

One legislative safeguard

for the medical cannabis industry, appended to the federal budget bill, remains in place following the rescission of the Cole

For fiscal years 2015, 2016, 2017 and 2018, Congress adopted a so-called “rider”

provision to the Consolidated

Appropriations Acts (formerly referred to as the Rohrabacher-Farr Amendment and currently referred to as the Rohrabacher-Blumenauer

Amendment) to prevent the federal government from using congressionally appropriated funds to enforce federal cannabis laws against

regulated medical cannabis actors operating in compliance with state and local law.

On September 27, 2019, the Rohrabacher-Blumenauer

Amendment was renewed as part of a stopgap spending bill, in effect through November 21, 2019, and was then renewed through a

series of stopgap spending bills passed in 2020.

On December 27, 2020, the amendment was renewed through the signing of the fiscal

year 2021 omnibus spending bill, effective through September 30, 2021.

Despite the rescission of the Cole Memo, the DOJ appears

to continue to adhere to the enforcement priorities set forth in the Cole Memo.

prosecutors have significant discretion, however, and no assurance can be given that the federal prosecutor in each judicial district

where we own a property will not choose to strictly enforce the federal laws governing marijuana production or distribution.

change in the federal government’s enforcement posture with respect to state-licensed cultivation of medical-use cannabis,

including the enforcement postures of individual federal prosecutors in judicial districts where we own or may purchase properties,

would result in our inability to execute our business plan, and we would likely suffer significant losses with respect to our

investment in marijuana facilities in the United States, which would adversely affect the trading price of our securities.

following any such change in the federal government’s enforcement position, we could be subject to criminal prosecution,

which could lead to imprisonment and/or the imposition of penalties, fines, or forfeiture.

of properties located in close proximity to our properties may assert claims against us regarding the use of the property as a

2 unchanged sentences

of properties located in close proximity to our properties may assert claims against us regarding the use of our properties as

marijuana dispensaries or for marijuana cultivation and processing, including assertions that the use of the property constitutes

cannabis dispensaries or for cannabis cultivation and processing, including assertions that the use of the property constitutes

a nuisance that diminishes the market value of such owner’s nearby property.

Such property owners may also attempt to assert such

a claim in federal court as a civil matter under the Racketeer Influenced and Corrupt Organizations Act.

If a property owner were

to assert such a claim against us, we may be required to devote significant resources and costs to defending ourselves against

Such property owners may also attempt to assert

such a claim in federal court as a civil matter under the Racketeer Influenced and Corrupt Organizations Act.

If a property owner

were to assert such a claim against us, we may be required to devote significant resources and costs to defending ourselves against

such a claim, and if a property owner were to be successful on such a claim, our tenants may be unable to continue to operate

their business in its current form at the property, which could materially adversely impact the tenant’s business and the value

of our property, our business and financial results and the trading price of our securities.

their business in its current form at the property, which could materially adversely impact the tenant’s business and the

value of our property, our business and financial results and the trading price of our securities.

and our tenants may have difficulty accessing the services of banks, which may make it difficult to contract for real estate needs.

transactions involving proceeds generated by cannabis and marijuana-related conduct can form the basis for prosecution under the

transactions involving proceeds generated by cannabis and cannabis-related conduct can form the basis for prosecution under the

federal money laundering statutes, unlicensed money transmitter statute and the Bank Secrecy Act.

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under the Bank Secrecy Act.

Prior to the DOJ’s announcement in January 2018 of the rescission of the “Cole Memo”

and related memoranda, supplemental guidance from the DOJ directed federal prosecutors to consider the federal enforcement priorities

enumerated in the “Cole Memo”

when determining whether to charge institutions or individuals with any of the financial

crimes described above based upon marijuana-related activity.

It is unclear what impact the recent rescission of the “Cole

will have, but federal prosecutors may increase enforcement activities against institutions or individuals that are

conducting financial transactions related to marijuana activities.

The increased uncertainty surrounding financial transactions

related to marijuana activities may also result in financial institutions discontinuing services to the marijuana industry.

Prior to the DOJ’s announcement in 2018 of the rescission of the Cole Memo and related memoranda,

supplemental guidance from the DOJ directed federal prosecutors to consider the federal enforcement priorities enumerated in the

Cole Memo when determining whether to charge institutions or individuals with any of the financial crimes described above based

upon marijuana-related activity.

It is unclear what impact the rescission of the Cole Memo will have, but federal prosecutors

may increase enforcement activities against institutions or individuals that are conducting financial transactions related to

marijuana activities.

The increased uncertainty surrounding financial transactions related to marijuana activities may also result

in financial institutions discontinuing services to the marijuana industry.

Consequently,

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marijuana industry, which would directly affect our financial condition.

the federal government legalize marijuana for medical use, it is possible that the U.S.

Food and Drug Administration (the “FDA”)

would seek to regulate it under the Food, Drug and Cosmetics Act of 1938.

Additionally, the FDA may issue rules and regulations

including cGMPs (certified good manufacturing practices) related to the growth, cultivation, harvesting and processing of medical

Clinical trials may be needed to verify efficacy and safety.

It is also possible that the FDA would require that facilities

where medical marijuana is grown be registered with the FDA and comply with certain federally prescribed regulations.

that some or all of these regulations are imposed, we do not know what the impact would be on the medical marijuana industry,

what costs, requirements and possible prohibitions may be enforced.

If we or our tenants are unable to comply with the regulations

and or registration as prescribed by the FDA, we and or our tenants may be unable to continue to operate their and our business

in its current form or at all.

the federal government legalize marijuana for medical use, it is possible that the FDA would seek to regulate it under the Food,

Drug and Cosmetics Act of 1938.

Additionally, the FDA may issue rules and regulations including cGMPs (certified good manufacturing

practices) related to the growth, cultivation, harvesting and processing of medical marijuana.

Clinical trials may be needed to

verify efficacy and safety.

It is also possible that the FDA would require that facilities where medical marijuana is grown be

registered with the FDA and comply with certain federally prescribed regulations.

In the event that some or all of these regulations

are imposed, we do not know what the impact would be on the medical marijuana industry, what costs, requirements and possible

prohibitions may be enforced.

If we or our tenants are unable to comply with the regulations and or registration as prescribed

by the FDA, we and or our tenants may be unable to continue to operate their and our business in its current form or at all.

Related to Our Common Stock

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UNRESOLVED STAFF COMMENTS

Item 1B is not applicable to smaller reporting companies.

1B is not applicable to smaller reporting companies.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors