NOTE 9. SUBSEQUENT EVENTS

We have evaluated subsequent events and transactions for potential recognition or disclosure in the financial statements through May 15, 2015, the day the financial statements were issued.

Leasing Activity

On April 8, 2015, the tenant occupying Santa Clara informed us of their desire to exercise the option to extend the two existing leases, which were originally set to expire on July 31, 2015. The leases were each extended for an additional two years, through July 31, 2017, and provide for annualized, straight-line rental income of approximately $1,303,000, representing a 5.8% increase over that of the previous leases.

On April 13, 2015, we renewed the lease with the tenant occupying Dalton Lane, which was originally set to expire on October 31, 2015. The lease was renewed for an additional five years, through October 31, 2020, and provides for rent escalations over its life, with annualized, straight-line rental income of approximately $164,000, representing a 16.8% increase over that of the previous lease. The new lease also grants the tenant one option to extend the lease for an additional five years.

Financing Activity

On April 9, 2015, and May 8, 2015, we obtained two additional loans from Farm Credit for approximately $0.9 million (the “Keysville Note”) and $2.6 million (the “Colding Loop Note”), respectively. The Keysville Note, which is non-amortizing, is scheduled to mature on May 1, 2020, and will bear interest at a fixed rate of 3.20% per annum throughout its term. Through April 30, 2018, the Colding Loop Note, which is scheduled to mature on May 1, 2030, will bear interest only at a fixed rate of 2.90% per annum, thereafter converting to an amortizing note bearing interest at a variable rate equal to the one-month LIBOR plus a spread of 3.00%. Proceeds from these notes were used to repay amounts owed under the MetLife Line of Credit and for other general corporate purposes.

2015 Equity Issuance

On May 15, 2015, we completed a public offering of 1,250,000 shares of our common stock at a public offering price of $11.40 per share. As a result of this offering, we received gross proceeds of approximately $14.3 million and net proceeds, after deducting underwriting discounts and offering expenses borne by us, of approximately $13.3 million. In connection with this offering, we granted the underwriters an over-allotment option to issue up to an additional 187,500 shares of our common stock, which option has not yet been exercised. We intend to use $8.4 million of these proceeds to repay amounts owed under the MetLife Line of Credit, with the remainder going towards future potential acquisitions and for other general corporate purposes.

Distributions

On April 14, 2015, our Board of Directors declared the following monthly cash distributions to common stockholders: