
<PAGE>   1
                                                                     EXHIBIT 3.1

                          FIRST AMENDED AND RESTATED
                          ARTICLES OF INCORPORATION
                                      OF
                      COMMERCIAL NET LEASE REALTY, INC.
                                      
                           -----------------------
                                      
        Commercial Net Lease Realty, Inc., a Maryland corporation (hereinafter,
the "Corporation"), hereby certifies to the Department of Assessments and
Taxation of the State of Maryland, that:


        FIRST: The Corporation desires to amend and restate its charter as
currently in effect.


        SECOND: Prior to this amendment and restatement the total number of
shares of all classes of capital stock that the Corporation had authority to
issue was one 180,000,000 shares, consisting of (i) 90,000,000 shares of common
stock, par value $0.01 per share: and (ii) 90,000,000 shares of excess stock,
par value $0.01 per share. The aggregate par value of all of the authorized
shares of all classes of capital stock having a par value was $1,800,000.00.
After this amendment and restatement the total number of shares of all classes
of capital stock that the Corporation will have authority to issue will be
210,000,000 shares consisting of (i) 90,000,000 shares of common stock, par
value $0.01; (ii) 15,000,000 shares of preferred stock, par value $0.01; and
105,000,000 shares of excess stock, par value $0.01. The aggregate par value of
all of the authorized shares of all classes of capital stock having a par value
will be $2,100,000.


        THIRD: The provisions of the charter which are now in effect and as
amended hereby, stated in accordance with the Maryland General Corporation Law
are as follows:

                                    ARTICLE I
                                      NAME

        The name of the Corporation is Commercial Net Lease Realty, Inc.


                                   ARTICLE II
                                    DURATION

        The duration of the Corporation is perpetual.


                                   ARTICLE III
                               PURPOSES AND POWERS

        The purpose for which the Corporation is formed is to engage in any
lawful business, act or activity for which corporations may be organized under
the laws of the State of Maryland and, in general, to possess and exercise all
the purposes, powers, rights and privileges granted to, or conferred upon,
corporations by the laws of the State of Maryland now or hereafter in force, and
to exercise any powers suitable, convenient or proper for the accomplishment of
the purposes herein enumerated, implied or incidental to the powers herein
enumerated or which at any time may appear conducive to or expedient for the
accomplishment of such purposes. The foregoing shall, 


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except where otherwise expressed, in no way be limited or restricted by
reference to or inference from the terms of any other clause of this or any
other provision of this Charter or of any amendment hereto or restatement
hereof, and shall each be regarded as independent and construed as powers as
well as purposes.

                                   ARTICLE IV
                       PRINCIPLE OFFICE AND RESIDENT AGENT

        The post office address of the principal office of the Corporation is
c/o The Corporation Trust Incorporated, 300 East Lombard Street, Baltimore, MD
21202. The resident agent of the Corporation is The Corporation Trust
Incorporated, 32 South Street, Baltimore, Maryland 21202. Said resident agent is
a Maryland corporation.



                                    ARTICLE V
                               BOARD OF DIRECTORS

        The number of directors shall be no less than three (3), unless a lesser
number is permitted pursuant to the terms of the Maryland General Corporation
Law as in effect from time to time or any successor statute thereto (the
"MGCL"). Subject to the foregoing, the number of directors of the Corporation
shall be fixed by the Bylaws of the Corporation and maybe increased or deceased
from time to time in such a manner as may be prescribed by the Bylaws. The
following persons will serve as directors of the Corporation until the annual
meeting and until their successors are elected and qualify:

               Robert A. Bourne             Ted B. Lanier
               Edward Clark                 James M. Seneff, Jr.
               Clifford R. Hinkle

                                   ARTICLE VI
                                AUTHORIZED STOCK

        SECTION 1. TOTAL CAPITALIZATION


        The total number of shares of all classes of capital stock that the
Corporation has authority to issue is two hundred ten million (210,000,000)
shares consisting of (i) ninety million (90,000,000) shares of common stock, par
value $0.01 (the "Common Stock"); (ii) fifteen million (15,000,000) shares of
preferred stock, par value $0.01 (the "Preferred Stock"); and one hundred five
million (105,000,000) shares of excess stock, par value $0.01 (the "Excess
Stock"). The aggregate par value of all of the authorized shares of all classes
of capital stock having a par value is $2,100,000.


        SECTION 2. CAPITAL STOCK


               A.  COMMON STOCK


                      (1)  COMMON STOCK SUBJECT TO TERMS OF PREFERRED STOCK. The
Common Stock shall be subject to the express terms of the Preferred Stock.


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                      (2)  DIVIDEND RIGHTS.  The holders of shares of Common 
Stock shall be entitled to receive such dividends as may be declared by the
Board of Directors of the Corporation out of funds legally available therefor.


                      (3)  RIGHTS UPON LIQUIDATION. In the event of any
voluntary or involuntary liquidation, dissolution or winding up, or any
distribution of the assets, of the Corporation, the aggregate amount available
for distribution to holders of shares of Common Stock (including, for purposes
of this sentence, holders of shares of Excess Stock) shall be determined by
applicable law. Except as provided below, each holder of shares of the Common
Stock shall be entitled to receive that portion of such aggregate amount,
ratably with (i) each other holder of shares of Common Stock and (ii) each
holder of shares of Excess Stock, as the number of shares of the Common Stock
held by such holder bears to the total number of shares of Common Stock and
Excess Stock. Anything herein to the contrary notwithstanding, in no event
shall the amount payable to a holder of shares with respect to Excess Stock
hereunder exceed (i) the price per share such holder paid for the Common Stock
in the purported Transfer (as that term is defined in paragraph A of Section 3
of this Article VI) that resulted in the Excess Stock or (ii) if the holder did
not give full value for such Excess Stock (as through a gift, devise or other
event or transaction), a price per share equal to the Market Price (as the term
is defined in paragraph A of Section 3 of this Article VI) for the shares of
the Common Stock on the date of the purported Transfer that resulted in such
Excess Stock. Any amount available for distribution in excess of the foregoing
limitations shall be paid ratably to holders of Common Stock and other holders
of Excess Stock resulting from the exchange of Common Stock to the extent
permitted by the foregoing limitations.
                                   

                      (4). VOTING RIGHTS. Except as may be provided in this
Charter, and subject to the express terms of any series of Preferred Stock, the
holders of shares of the Common Stock shall have the exclusive right to vote on
all matters (as to which a common stockholder shall be entitled to vote) at all
meetings of the stockholders of the Corporation, and shall be entitled to one
(1) vote for each share of the Common Stock entitled to vote at such meetings.


               B.  PREFERRED STOCK


               The Preferred Stock may be issued from time to time in one or
more series as authorized by the Board of Directors. Prior to the issuance of
shares of each such series, the Board of Directors, by resolution, shall fix the
number of shares to be included in each series, and the terms, rights,
restrictions and qualifications of the shares of each series. The authority of
the Board of Directors with respect to each series shall include, but not be
limited to, determination of the following:


        (i)    The designation of the series, which may be by distinguishing
               number, letter or title;


        (ii)   The dividend rate on the shares of the series, if any, whether
               any dividends shall be cumulative and, if so, from which date or
               dates, and the relative rights of priority, if any, of payment of
               dividends on shares of the series;

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        (iii)  The redemption rights, including conditions and the price or
               prices, if any, for shares of the series;


        (iv)   The terms and amounts of any sinking fund for the purchase or
               redemption of shares of the series;


        (v)    The rights of the shares of the series in the event of any
               voluntary or involuntary liquidation, dissolution or winding up
               of the affairs of the Corporation, and the relative rights of
               priority, if any, of payment of shares of the series;


        (vi)   Whether the shares of the series shall be convertible into shares
               of any other class or series, or any other security, of the
               Corporation or any other corporation or other entity, and, if so,
               the specification of such other class or series of such other
               security, the conversion price or prices or dates on which such
               shares shall be convertible and all other terms and conditions
               upon which such conversion may be made;


        (vii)  Restrictions on the issuance of shares of the same series or of
               any other class or series;


        (viii) The voting rights, if any, of the holders of shares of the
               series; and


        (ix)   Any other relative rights, preferences and limitations on that
               series.


        Subject to the express provisions of any other series of Preferred Stock
then outstanding, notwithstanding any other provision of this Charter, the Board
of Directors may increase or decrease (but not below the number of shares of
such series then outstanding) the number of shares, or alter the designation or
classify or reclassify any unissued shares of a particular series of Preferred
Stock, by fixing or altering, in one or more respects, from time to time before
issuing the shares, the terms, rights, restrictions and qualifications of the
shares of any such series of Preferred Stock.

        SECTION 3.    RESTRICTIONS ON TRANSFER; ACQUISITIONS AND
                      REDEMPTION SHARES


               A. DEFINITIONS. For purposes of Sections 3 and 4 of this Article
VI, the following terms shall have the following meanings:


                             "Beneficial Ownership" shall mean ownership of
               shares of Capital Stock by an individual who would be treated as
               an owner of such shares under Section 542(a)(2) of the Code,
               either directly or constructively through the application of
               Section 544, as modified by Section 856(h)(1)(B). For purposes of
               this definition, the term "individual" also shall include any
               organization, trust or other entity that is treated as an
               individual for purposes of Section 542(a)(2) of 

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               the Code. The terms "Beneficial Owner," "Beneficially Own,"
               "Beneficially Owns" and "Beneficially Owned" shall have
               correlative meanings.


                             "Beneficiary" shall mean a beneficiary of the Trust
               as determined pursuant to paragraph A of Section 4 of this
               Article VI.


                             "Board of Directors" shall mean the Board of
               Directors of the Corporation.


                             "Bylaws" shall mean the Bylaws of the Corporation.


                             "Capital Stock" shall mean collectively the stock
               of the Corporation that is either Common Stock and Preferred
               Stock.


                             "Code" shall mean the Internal Revenue Code of
               1986, as amended from time to time, or any successor statute
               thereto. Reference to any provision of the Code shall mean such
               provision as in effect from time to time, as the same may be
               amended, and any successor thereto, as interpreted by any
               applicable regulations thereto and judicial decisions as in
               effect from time to time.


                             "Constructive Ownership" shall mean ownership of
               shares of Capital Stock by a Person who would be treated as an
               owner of such shares, either actually or constructively, through
               the application of Section 318 of the Code, as modified by
               Section 856(d)(5) thereof. The terms "Constructive Owner,"
               "Constructively Own," "Constructively Owns" and "Constructively
               Owned" shall have correlative meanings.


                             "Market Price" on any day shall mean the average of
               the Closing Prices for the ten (10) consecutive Trading Days
               immediately preceding such day (or those days during such 10-day
               period for which Closing Prices are available). The "Closing
               Price" on any day shall mean the last sale price, regular way, on
               such day or if no such sale takes place on that day, the average
               of the closing bid and asked prices, regular way, in either case
               as reported on the principal consolidated transaction reporting
               system with respect to securities listed or admitted to trading
               on the New York Stock Exchange or the American Stock Exchange, or
               if the Capital Stock is not so listed or admitted to trading, as
               reported in the principal consolidated transaction reporting
               system with respect to securities listed on the principal
               national securities exchange (including the National Market
               System of the National Association of Securities Dealers, Inc.
               Automated Quotation System) on which the Capital 

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               Stock is listed or admitted to trading or, if the Capital Stock
               is not so listed or admitted to trading, the last quoted price,
               or if not quoted, the average of the high bid and low asked
               prices in the over-the-counter market, as reported by the
               National Association of Securities Dealers, Inc. Automated
               Quotation System or, if such system is no longer in use, the
               principal automated quotation system then in use or, if the
               Capital Stock is not so quoted by any such system, the average of
               the closing bid and asked prices as furnished by a professional
               market maker selected by the Board of Directors making a market
               in the Capital Stock or, if there is no such market maker or such
               closing prices otherwise are not available, the fair market value
               of the Capital Stock as of such day, as determined by the Board
               of Directors in its discretion.


                             "Ownership Limit" shall mean 9.8 percent of the
               Value of the outstanding Capital Stock.


                             "Person" shall mean an individual, corporation,
               partnership, 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, or a group as that
               term is used for purposes of Section 13(d)(3) of the Securities
               Exchange Act of 1934, as amended; but does not include an
               underwriter which participated in a public offering of Capital
               Stock for a period of sixty (60) days following the purchase by
               such underwriter of Capital Stock therein, provided that the
               foregoing exclusion shall apply in an underwriting only if the
               ownership of such Capital Stock by such underwriter would not
               cause the Corporation to fail to qualify as a REIT by reason of
               being "closely held" within the meaning of Section 856(a) of the
               Code or otherwise cause the Corporation to fail to qualify as a
               REIT.


                             "Purported Beneficial Transferee" shall mean, with
               respect to any purported Transfer which results in Excess Stock,
               the purported beneficial transferee for whom the Purported Record
               Transferee would have acquired shares of Capital Stock if such
               Transfer had been valid under paragraph B of this Section 3.


                             "Purported Record Transferee" shall mean, with
               respect to any purported Transfer which results in Excess Stock,
               the record holder of the Capital Stock if such Transfer had been
               valid under paragraph B of this Section 3.

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                             "REIT" shall mean a real estate investment trust
               under Sections 856 through 860 of the Code.


                             "Restriction Termination Date" shall mean the first
               day on which the Board of Directors and the stockholders of the
               Corporation determine that it is no longer in the best interests
               of the Corporation to attempt, or continue, to qualify as a REIT.


                             "Trading Day" shall mean a day on which the
               principal national securities exchange on which the Capital Stock
               is listed or admitted to trading is open for the transaction of
               business or, if the Capital Stock is not listed or admitted to
               trading, shall mean any day other than a Saturday, Sunday or
               other day on which banking institutions in the State of New York
               are authorized or obligated by law or executive order to close.


                             "Transfer" shall mean any sale, transfer, gift,
               hypothecation, assignment, devise or other disposition of Capital
               Stock (including (i) the granting of any option (including any
               option to acquire any option or any series of such options) or
               entering into any agreement for the sale, transfer or other
               disposition of Capital Stock or (ii) the sale, transfer,
               assignment or other disposition of any securities or rights
               convertible into or exchangeable for Capital Stock), whether
               voluntary or involuntary, of record, constructively or
               beneficially, and whether by operation of law or otherwise. The
               terms "Transfers" and "Transferred" shall have correlative
               meanings.


                             "Trust" shall mean the trust created pursuant to
               paragraph A of Section 4 of this Article VI.


                             "Trustee" shall mean the Corporation as trustee for
               the Trust, and any successor trustee appointed by the
               Corporation.


                             "Value" shall mean, as of any given date, the
               Market Price per share of each class of Capital Stock then
               outstanding, multiplied by the number of shares of such class
               then outstanding.


               B.  OWNERSHIP AND TRANSFER LIMITATION


                             (1)     Notwithstanding any other provision of 
this Charter, except as provided in paragraph I of this Section 3 and
Section 5 of this Article VI, prior to the Restriction Termination Date, no
Person shall Beneficially or Constructively Own shares of Capital Stock in
excess of the Ownership Limit.



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                      (2)     Notwithstanding any other provision of this
Charter, except as provided in paragraph I of this Section 3 and Section 5 of
this Article VI, prior to the Restriction Termination Date, any Transfer, change
in the capital structure of the Corporation, or other purported change in
Beneficial or Constructive Ownership of Capital Stock that, if effective, would
result in any Person Beneficially or Constructively Owning Capital Stock in
excess of the Ownership Limit shall be void ab initio as to the Transfer, change
in the capital structure of the Corporation, or other purported change in
Beneficial or Constructive Ownership with respect to that number of shares of
Capital Stock which would otherwise be Beneficially or Constructively Owned by
Such Person in excess of the Ownership Limit, and neither the Purported
Beneficial Transferee nor the Purported Record Transferee shall acquire any
rights in that number of shares of Capital Stock.


                      (3)     Notwithstanding any other provision of this
Charter, except as provided in Section 5 of this Article VI, prior to the
Restriction Termination Date, any Transfer, change in the capital structure of
the Corporation, or other purported change in ownership of Capital Stock that,
if effective, would result in the Capital Stock being owned by fewer than 100
Persons (determined without reference to any rules of attribution) shall be void
ab initio as to the Transfer, change in the capital structure of the
Corporation, or other purported change in ownership with respect to that number
of shares which otherwise would be owned by the transferee, and the intended
transferee or subsequent owner (including a Beneficial Owner) shall acquire no
rights in that number of shares of Capital Stock.


                      (4)     Notwithstanding any other provisions of this
Charter except Section 5 of this Article VI, prior to the Restriction
Termination Date, any Transfer, change in the capital structure of the
Corporation, or other purported change in Beneficial Ownership of shares of
Capital Stock that, if effective, would cause the Corporation to fail to
qualify as a REIT by reason of being "closely held" within the meaning of
Section 856(h) of the Code or otherwise, directly or indirectly, would cause
the Corporation to fail to qualify as a REIT shall be void ab initio as to the
Transfer, change in the capital structure of the Corporation, or other
purported change in Beneficial Ownership with respect to that number of shares
of Capital Stock which would cause the Corporation to be "closely held" within
the meaning of Section 856(h) of the Code or otherwise, directly or indirectly,
would cause the Corporation to fail to qualify as a REIT, and the intended
transferee or subsequent Beneficial Owner shall acquire no rights in that
number of shares of Capital Stock.                      


               C.     EXCHANGE FOR EXCESS STOCK.


                      (1)     If, notwithstanding the other provisions 
contained in this Article VI, at any time prior to the Restriction Termination
Date, there is a purported Transfer, change in the capital structure of the
Corporation or other purported change in the Beneficial or Constructive
Ownership of Capital Stock such that any person would either Beneficially or
Constructively Own Capital Stock in excess of the Ownership Limit, then, except
as otherwise provided in paragraph I of this Section 3, such shares of Capital
Stock (rounded up to the next whole number of shares) in excess of the Ownership
Limit automatically shall be exchanged for an equal number of shares of Excess
Stock having terms, rights, restrictions and qualifications identical thereto,
except to the 

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extent that this Article VI requires different terms. Such exchange shall be
effective as of the close of business on the business day next preceding the
date of the purported Transfer, change in capital structure or other change in
purported Beneficial or Constructive Ownership of Capital Stock.


                      (2)     If, notwithstanding the other provisions 
contained in this Article VI, prior to the Restriction Termination Date, there
is a purported Transfer, change in the capital structure of the Corporation or
other purported change in Beneficial Ownership of Capital Stock which, if
effective, would cause the Corporation to fail to qualify as a REIT by reason of
being "closely held" within the meaning of Section 856(h) of the Code, or
otherwise, directly or indirectly would cause the Corporation to fail to qualify
as a REIT, then the shares of Capital Stock (rounded up to the next whole number
of shares), being Transferred or which are otherwise affected by the change in
capital structure or other purported change in Beneficial Ownership and which,
in any case, would cause the Corporation to be "closely held" within the meaning
of such Section 856(h) or otherwise would cause the Corporation to fail to
qualify as a REIT automatically shall be exchanged for an equal number of shares
of Excess Stock having terms, rights, restrictions and qualifications identical
thereto, except to the extent that this Article VI requires different terms.
Such exchange shall be effective as of the close of business on the business day
next preceding the date of the purported Transfer, change in capital structure
or other purported change in Beneficial Ownership.


               D.     REMEDIES FOR BREACH. If the Board of Directors or its
designee shall at any time determine in good faith that a Transfer or change in
the capital structure of the Corporation has taken place in violation of
paragraph B of this Section 3 or that a Person intends to acquire or has
attempted to acquire Beneficial or Constructive Ownership of any shares of
Capital Stock in violation of paragraph B of this Section 3, the Board of
Directors or its designee shall take such actions as it deems advisable to
refuse to give effect to or to prevent such Transfer, change in capital
structure of the Corporation or other attempt to acquire Beneficial or
Constructive Ownership of any shares of Capital Stock, including, but not
limited to, refusing to give effect thereto on the books of the Corporation or
instituting injunctive proceedings with respect thereto; provided, however,
that any Transfer, change in the capital structure of the Corporation,
attempted Transfer or other attempt to acquire Beneficial or Constructive
Ownership of any shares of Capital Stock in violation of subparagraphs (2), (3)
and (4) of paragraph B of this Section 3 (as applicable) shall be void ab
initio and where applicable automatically shall result in the exchange
described in paragraph C of this Section 3, irrespective of any action (or
inaction) by the Board of Directors or its designee.
                                

               E.     NOTICE OF RESTRICTED TRANSFER. Any Person who acquires or
attempts to acquire Beneficial or Constructive Ownership of shares of Capital
Stock in violation of paragraph B of this Section 3 and any Person who
Beneficially or Constructively owns Excess Stock pursuant to paragraph C of this
Section 3 shall immediately give written notice to the Corporation, or, in the
event of a proposed or attempted Transfer or purported change in Beneficial
Ownership, shall give at least fifteen (15) days prior written notice to the
Corporation, of such event and shall promptly provide to the Corporation such
other information as the Corporation may request in 

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order to determine the effect, if any, of such Transfer, attempted Transfer or
purported change in Beneficial Ownership on the Corporation's status as a REIT.


               F.     OWNERS REQUIRED TO PROVIDE INFORMATION.  Prior to the 
Restriction Termination Date:


                      (1)     Every Beneficial or Constructive Owner of more
than 5.0 percent, or such lower percentages as required pursuant to regulations
under the Code or as may be requested by the Board of Directors, of the Value
of the outstanding Capital Stock of the Corporation shall annually, no later
than January 31 of each calendar year, give written notice to the Corporation
stating (i) the name and address of such Beneficial or Constructive Owner; (ii)
the number of shares of Capital Stock Beneficially or Constructively Owned and
(iii) a description of how such shares are held. Each such Beneficial or
Constructive Owner promptly shall provide to the Corporation such additional
information as the Corporation, in its sole discretion, may request in order to
determine the effect, if any, of such Beneficial or Constructive Ownership on
the Corporation's status as a REIT and to ensure compliance with the Ownership
Limit.                                  


                      (2)     Each person who is a Beneficial or Constructive
Owner of Capital Stock and each Person (including the stockholder of record)
who is holding Capital Stock for a Beneficial or Constructive Owner promptly
shall provide to the Corporation such information as the Corporation, in its
sole discretion, may request in order to determine the Corporation's status as
a REIT, to comply with the requirements of any taxing authority or other
governmental agency, to determine any such compliance or to ensure compliance
with the Ownership Limit.


               G.     REMEDIES NOT LIMITED. Noting contained in this Article VI
except Section 5 hereof shall limit scope or application of the provisions of
this Section 3, the ability of the Corporation to implement or enforce
compliance with the terms thereof or the authority of the Board of Directors to
take any such other action or actions as it may deem 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, including, without limitation, refusal to give effect to a transaction on
the books of the Corporation.


               H.     AMBIGUITY. In the case of an ambiguity in the application
of any of the provisions of this Section 3, including any definition contained
in paragraph A hereof, the Board of Directors shall have the power and
authority, in its sole discretion, to determine the application of the
provisions of this Section 3 with respect to any situation based on the facts
known to it.
                                     

               I.     EXCEPTION. The Board of Directors, upon receipt of a
ruling from the Internal Revenue Service, an opinion of counsel, or other
evidence satisfactory to the Board of Directors, in its sole discretion, in
each case to the effect that the restrictions contained in subparagraph 3 and
subparagraph 4 of paragraph B of this Section 3 will not be violated, may
waive, in whole or in part, the application of the Ownership Limit with respect
to any Person. In connection with any exemption, the Board of Directors may
require such representations and undertakings from such Person and may impose
such other conditions as the Board deems         

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necessary, in its sole discretion, to determine the effect, if any, of the
proposed Transfer on the Corporation's status as a REIT.


               J.     LIMITATIONS ON MODIFICATIONS.


                      (1)     The Ownership Limit may not be increased 
(nor may any additional ownership limitations be created) if, after giving
effect to such increase or creation, the Corporation would be "closely held"
within the meaning of Section 856(h) of the Code (assuming ownership of shares
of Capital Stock by all Persons equal to the greater of the Beneficial Ownership
of Capital Stock by such Person or the Ownership Limit).


                      (2)     Prior to any modification of the Ownership 
Limit, the Board of Directors may require such opinions of counsel, affidavits,
undertakings or agreements as it may deem necessary, advisable or prudent in
order to determine or ensure the Corporation's status a REIT.
                                        

               K.     LEGEND. Each certificate for shares of Capital Stock shall
bear substantially the following legend:


                             "The securities represented by this certificate are
               subject to restrictions on transfer for the purpose of
               maintenance of the Corporation's status as a real estate
               investment trust under the Internal Revenue Code of 1986, as
               amended (the "Code"). Except as otherwise provided pursuant to
               the Charter of the Corporation, no Person may (i) Beneficially or
               Constructively Own shares of Capital Stock in excess of 9.8
               percent of the Value of the outstanding shares of Capital Stock
               of the Corporation; or (ii) Beneficially Own Capital Stock which
               would result in the Corporation being "closely held" under
               Section 856(h) of the Code or otherwise would cause the
               Corporation to fail to qualify as a REIT. Any Person who attempts
               or proposes to Beneficially or Constructively Own shares of
               Capital Stock in excess of the above limitations must notify the
               Corporation in writing at least fifteen (15) days prior to the
               proposed or attempted transfer. If the transfer restrictions
               referred to herein are violated, the shares of Capital Stock
               represented hereby automatically will be exchanged for shares of
               Excess Stock and will be held in trust by the Corporation, all as
               provided in the Charter of the Corporation. All capitalized terms
               in this legend have the meanings identified in the Corporation's
               Charter, as the same may be amended or restated from time to
               time, a copy of which, including the restrictions on transfer,
               will be sent without charge to each stockholder who so requests."


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        SECTION 4.  EXCESS STOCK.


                      A.     OWNERSHIP IN TRUST.  Upon any purported Transfer, 
change in the capital structure of the Corporation or other purported change in
Beneficial Ownership that results in Excess Stock pursuant to paragraph C of
Section 3 of this Article VI, such Excess Stock shall be deemed to have been
transferred to the Corporation as Trustee of a Trust for the benefit of such
Beneficiary or Beneficiaries to whom an interest in such Excess Stock may later
be transferred pursuant to paragraph E of this Section 4. Shares of Excess Stock
so held in trust shall be issued and outstanding stock of the Corporation. The
Purported Record Transferee shall have no rights in such Excess Stock except the
right to designate a transferee of such Excess Stock upon the terms specified in
paragraph E of this Section 4. The Purported Beneficial Transferee shall have no
rights in such Excess Stock except as provided in paragraph C of this Section 4.


                      B.     DIVIDEND RIGHTS.  Excess Stock shall not be 
entitled to any dividends. Any dividend or distribution paid prior to the
discovery by the Corporation that the shares of Capital Stock have been
exchanged for Excess Stock shall be repaid to the Corporation upon demand, and
any dividend or distribution declared but unpaid at the time of such discovery
shall be rescinded as void ab initio with respect to such shares of Excess
Stock.


                      C.     RIGHTS UPON LIQUIDATION.


                             (1)     Except as provided below, in the event of 
any voluntary or involuntary liquidation, dissolution or winding up, or any
other distribution of the assets, of the Corporation, each holder of shares of
Excess Stock resulting from the exchange of Preferred Stock of any specified
series shall be entitled to receive, ratably with each other holder of shares of
Excess Stock resulting from the exchange of shares of Preferred Stock of such
series and each holder of shares of Preferred Stock of such series, such accrued
and unpaid dividends, liquidation preferences and other preferential payments,
if any, as are due to holders of shares of Preferred Stock of such series. In
the event that holders of shares of any series of Preferred stock are entitled
to participate in the Corporation's distribution of its residual assets, each
holder of shares of Excess Stock resulting from the exchange of Preferred Stock
of any such series shall be entitled to participate, ratably with (i) each other
holder of shares of Excess stock resulting from the exchange of shares of
Preferred Stock of all series entitled to so participate; (ii) each holder of
shares of Preferred Stock of all series entitled to so participate; and (iii)
each holder of shares of Common Stock and Excess Stock resulting from the
exchange of shares of Common Stock (to the extent permitted by paragraph C of
Section 3 of Article VI hereof), that portion of the aggregate assets available
for distribution (determined in accordance with applicable law) as the number of
shares of such Excess Stock held by such holder bears to the total number of (i)
outstanding shares of Excess Stock resulting from the exchange of Preferred
Stock of all series entitled to so participate; (ii) outstanding shares of
Preferred Stock of all series entitled to so participate; and (iii) outstanding
shares of Common Stock and shares of Excess Stock resulting from the exchange of
shares of Common Stock. The Corporation, as holder of the Excess Stock in trust,
or, if the Corporation shall have been dissolved, any trustee appointed by the
Corporation prior to its dissolution, shall distribute ratably to the
Beneficiaries of the Trust, when determined, any such assets received in respect
of the Excess Stock in any liquidation, dissolution or winding up, or any

                                      -12-
<PAGE>   13

distribution of the assets, of the Corporation. Anything to the contrary herein
notwithstanding, in no event shall the amount payable to a holder with respect
to shares of Excess Stock resulting from the exchange of shares of Preferred
Stock exceed (i) the price per share such holder paid for the Preferred Stock in
the purported Transfer that resulted in the Excess Stock or (ii) if the holder
did not give full value for such Excess Stock (as through a gift, devise or
other event or transaction), a price per share equal to the Market Price for the
shares of Preferred Stock on the date of the purported Transfer that resulted in
such Excess Stock. Any amount available for distribution in excess of the
foregoing limitations shall be paid ratably to the holders of shares of
Preferred Stock and other holders of Excess Stock resulting from the exchange of
Preferred Stock to the extent permitted by the foregoing limitations.


                      (2)     Except as provided below, in the event of any
voluntary of involuntary liquidation, dissolution or winding up, or any other
distribution of the assets, of the Corporation, each holder of shares of Excess
Stock resulting from the exchange of Common Stock shall be entitled to receive,
ratably with (i) each other holder of shares of such Excess Stock and (ii) each
holder of Common Stock, that portion of the aggregate assets available for
distribution to holders of shares of Common Stock (including holders of Excess
Stock resulting from the exchange of Common Stock pursuant to paragraph C of
Section 3 of Article VI hereof), determined in accordance with applicable law,
as the number of shares of such Excess Stock held by such holder bears to the
total number of shares of outstanding Common Stock and outstanding Excess Stock
resulting from the exchange of Common Stock then outstanding. The Corporation,
as holder of the Excess Stock in trust, or, if the Corporation shall have been
dissolved, any trustee appointed by the Corporation prior to its dissolution,
shall distribute ratably to the Beneficiaries of the Trust, when determined,
any such assets received in respect of the Excess Stock in any liquidation,
dissolution or winding up, or any distribution of the assets, of the
Corporation. Anything herein to the contrary notwithstanding, in no event shall
the amount payable to a holder with respect to shares of Excess Stock exceed
(i) the price per share such holder paid for the Common Stock in the purported
Transfer that resulted in the Excess Stock or (ii) if the holder did not give
full value for such Excess Stock (as through a gift, devise or other event or
transaction), a price per share equal to the Market Price for the shares of
Common Stock on the date of the purported Transfer that resulted in such Excess
Stock. Any amount available for distribution in excess of the foregoing
limitations shall be paid ratably to the holders of shares of Common Stock and
other holders of Excess Stock resulting from the exchange of Common Stock to
the extent permitted by the foregoing limitations.
                                            

               D.     VOTING RIGHTS. The holders of shares of Excess Stock 
shall  not be entitled to vote on any matters (except as required by MGCL).


               E.     RESTRICTIONS ON TRANSFER; DESIGNATION OF BENEFICIARY.


                      (1)     Excess Stock shall not be transferable.  The 
Purported Record Transferee may freely designate a Beneficiary of its interest
in the Trust (representing the number of shares of Excess Stock held by the
Trust attributable to a purported Transfer that resulted in the Excess Stock, if
(i) the shares of Excess Stock held in the Trust would not be Excess Stock in
the hands of such Beneficiary and (ii) the Purported Beneficial Transferee does
not receive a price for 

                                      -13-
<PAGE>   14

designating such Beneficiary that reflects a price per share for such Excess
Stock that exceeds (x) the price per share such Purported Beneficial Transferee
paid for the Capital Stock in the purported Transfer that resulted in the Excess
Stock or (y) if the Purported Beneficial Transferee did not give value for such
shares of Excess Stock (as through a gift, device or other event or
transaction), a price per share equal to the Market Price for the shares of
Capital Stock on the date of the purported Transfer that resulted in the Excess
Stock. Upon such transfer of an interest in the Trust, the corresponding shares
of Excess Stock in the Trust automatically shall be exchanged for an equal
number of shares of Capital Stock and such shares of Capital Stock shall be
transferred of record to the Beneficiary of the interest in the Trust designated
by the Purported Record Transferee, as described above, if such Capital Stock
would not be Excess Stock in the hands of such Beneficiary. Prior to any
transfer of any interest in the Trust, the Purported Record Transferee must give
advance notice to the Corporation of the intended transfer and the Corporation
must have waived in writing its purchase rights under paragraph F of this
Section 4.


                      (2)    Notwithstanding the foregoing, if a Purported 
Beneficial Transferee receives a price for designating a Beneficiary of an
interest in the Trust that exceeds the amounts allowable under subparagraph (1)
of this paragraph E, such Purported Beneficial Transferee shall pay, or cause
the Beneficiary of the interest in the Trust to pay, such excess to the
Corporation.


                      (3)    If any of the transfer restrictions set forth in 
this paragraph E, or any application thereof, is determined to be void, invalid
or unenforceable by any court having jurisdiction over the issue, the Purported
Record Transferee may be deemed, at the option of the Corporation, to have acted
as the agent of the Corporation in acquiring the Excess Stock as to which such
restrictions would, by their terms, apply, and to hold such Excess Stock on
behalf of the Corporation.


               F.     PURCHASE RIGHT IN EXCESS STOCK. Shares of Excess Stock 
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 Excess Stock (or, in the case of
devise or gift, the Market Price at the time of such devise or gift) and (ii)
the Market Price of the Capital Stock exchanged for such Excess Stock 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 (90) days
after the later of (i) the date of the purported Transfer, change in capital
structure of the Corporation or purported change in Beneficial Ownership which
resulted in such Excess Stock and (ii) the date on which the Board of Directors
determines in good faith that a Transfer, change in capital structure of the
Corporation or purported change in Beneficial Ownership resulting in Excess
Stock has occurred, if the Corporation does not receive a notice pursuant to
paragraph E of Section 3 of this Article VI, but in no event later than a
permitted Transfer pursuant to and in compliance with the terms of paragraph E
of this Section 4.


               G.     REMEDIES NOT LIMITED. Nothing contained in this Article VI
except Section 5 hereof shall limit scope or application of the provisions of
this Section 4, the ability of the Corporation to implement or enforce
compliance with the terms thereof or the authority of the Board of Directors to
take any such other action or actions as it may deem necessary or advisable to
protect the Corporation and the interests of its stockholders by preservation of
the 

                                      -14-
<PAGE>   15

Corporation's status as a REIT and to ensure compliance with the Ownership
Limit, including, without limitation, refusal to give effect to a transaction on
the books of the Corporation.


        SECTION 5.  SETTLEMENTS.

        Nothing in Sections 3 and 4 of this Article VI shall preclude the
settlement of any transaction with respect to the Capital Stock entered into
through the facilities of the New York Stock Exchange or other national
securities exchange on which the Capital Stock is listed.


        SECTION 6.    SEVERABILITY


        If any provision of this Article VI or any application of any such
provision is determined to be void, invalid or unenforceable by any court having
jurisdiction over the issue, the validity and enforceability of the remainder of
this Article VI 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.

                                   ARTICLE VII
            MATTERS RELATING TO THE POWERS OF THE CORPORATION AND ITS
                           DIRECTORS AND STOCKHOLDERS


        The following provisions are hereby adopted for the purpose of defining,
limiting and regulating the powers of the Corporation and of the directors and
stockholders thereof:


        SECTION 1.   MATTERS RELATING TO THE BOARD OF DIRECTORS.


                      A.     AUTHORITY AS TO BYLAWS.        Except as otherwise 
provided herein, in furtherance and not in limitation of the powers conferred by
statute, the Board of Directors is expressly authorized to make, alter, amend or
repeal the Bylaws of the Corporation and the Corporation may, in its Bylaws,
confer powers on the Board of Directors in addition to these contained herein or
conferred by applicable law.


                      B.     AUTHORITY AS TO STOCK ISSUANCES.    The Board of 
Directors of the Corporation may authorize the issuance from time to time of
shares of its stock of any class, whether now or hereafter authorized, or
securities convertible into shares now or hereafter authorized, for such
consideration as the Board of Directors may deem advisable, subject to such
restrictions or limitations, if any, as may be set forth in the Charter or the
Bylaws of the Corporation or in the general laws of the State of Maryland.


                      C.     MANNER OF ELECTION.       Unless and except to the 
extent that the Bylaws of the Corporation shall so require, the election of
directors of the Corporation need not be by written ballot.

                                      -15-
<PAGE>   16


                      D.     REMOVAL OF DIRECTORS.   Any director may be 
removed from office at any time, with or without cause, by the affirmative vote
of the holders of a majority of the then outstanding Capital Stock entitled to
vote generally in the election of directors.


                      E.     PERMISSIBLE CRITERIA FOR CONSIDERATION OF BEST 
INTERESTS.   In determining what is in the best interest of the Corporation, a
director of the Corporation shall consider the interests of the stockholders of
the Corporation and, in his or her discretion, may consider the interests of the
Corporation's employees, suppliers, creditors and tenants and the long-term as
well as short-term interests of the Corporation and its stockholders, including
the possibility that these interests may be best served by the continued
independence of the Corporation.


                      F.     DETERMINATIONS BY BOARD.   The determination
as to any of the following matters, made in good faith by or pursuant
to the direction of the Board of Directors consistent with the Charter of the
Corporation and in the absence of actual receipt of an improper benefit in
money, property or services or active and deliberate dishonesty established by
a court, shall be final and conclusive and shall be binding upon the
Corporation and every holder of shares of its stock: (i) the amount of the net
income of the Corporation for any period and the amount of assets at any time
legally available for the payment of dividends, redemption of its stock or the
payment of other distributions on its stock; (ii) the amount of paid-in
surplus, net assets, other surplus, annual or other net profit, net assets in
excess of capital, undivided profits or excess of profits over losses on sales
of assets; the amount, purpose, time of creation, increase or decrease,
alteration or cancellation of any reserves or charges and the propriety thereof
(whether or not any obligation or liability for which such reserves shall have
been created shall have been paid or discharged); (iii) the fair value, or any
sale, bid or asked priced to be applied in determining the fair value, of any
asset owned or held by the Corporation; and (iv) any matters relating to the
acquisition, holding and disposition of any assets by the Corporation.


                      G.     RESERVED POWERS OF BOARD.   The enumeration and 
definition of particular powers of the Board of Directors included in this
Article VII shall in no way be limited or restricted by reference to or
inference from the terms of any other clause of this or any other provision of
the Charter of the Corporation, or construed or deemed by inference or otherwise
in any manner to exclude or limit the powers conferred upon the Board of
Directors under the laws of the State of Maryland as now or hereafter in force.


                      H.     ALTERATION OF AUTHORITY GRANTED TO THE BOARD OF 
DIRECTORS.   The affirmative vote of that proportion of the then-outstanding
Capital Stock necessary to approve an amendment to this Charter pursuant to the
MGCL and Article XI hereof shall be required to amend, repeal or adopt any
provision inconsistent with Section 1 of this Article VII or with Section 3.12
of the Bylaws of the Corporation (including defined terms therein).


                      I.     REIT QUALIFICATION.   The Board of Directors 
shall use its best efforts to cause the Corporation and its stockholders to
qualify for U.S. federal income tax treatment in accordance with the provisions
of the Code applicable to REITs. In furtherance of the foregoing, the Board of
Directors shall use its best efforts to take such actions as are necessary, and
may take 

                                      -16-
<PAGE>   17

such actions as it deems desirable (in its sole judgment and discretion) to
preserve the status of the Corporation as a REIT (as that term is defined in
paragraph A of Section 3 of Article VI hereof); provided, however, that in the
event that the Board of Directors determines, in its sole judgment and
discretion, that it is no longer in the best interests of the Corporation to
qualify as a REIT, the Board of Directors shall take such actions as are
required by the Code (as that term is defined in paragraph A of Section 3 of
Article VI hereof), the MGCL and other applicable law, to cause the matter of
termination of qualification as a REIT to be submitted to a vote of the
stockholders of the Corporation pursuant to paragraph A of Section 2 of this
Article VII.

        SECTION 2.    MATTERS RELATING TO THE STOCKHOLDERS.

               A.     TERMINATION OF REIT STATUS.      Notwithstanding anything 
contained in this Charter to the contrary, the affirmative vote of the holders
of a majority of the then-outstanding Capital Stock entitled to vote generally
in the election of directors and the approval of the Board of Directors shall be
required to terminate voluntarily the Corporation's status as a REIT (as that
term is defined in paragraph A of Section 3 of Article VI).


               B.     NO CUMULATIVE RIGHTS.      Stockholders of the 
Corporation shall not have cumulative voting rights in the election of 
directors.


               C.     NO PREEMPTIVE RIGHTS.      No holders of stock of the 
Corporation, of whatever class, shall have any preferential right of
subscription to any shares of stock of any class or to any securities
convertible into shares of stock of any class of the Corporation, nor any right
of subscription to any thereof.

                                  ARTICLE VIII
                              DIRECTORS' LIABILITY

        To the maximum extent that Maryland law in effect from time to time
permits limitation of the liability of directors and officers, no director or
officer of the Corporation shall be liable to the Corporation or its
stockholders for money damages. Neither the amendment nor repeal of this Article
VIII, nor the adoption or amendment of any provision of the Charter or Bylaws of
the Corporation inconsistent with this Article VIII, shall apply to or affect in
any respect the applicability of the preceding sentence with respect to any act
or failure to act which occurred prior to such amendment, repeal or adoption.

                                   ARTICLE IX
                                 INDEMNIFICATION

        Each person who is or was or who agrees to become a director or officer
of the Corporation, or each person who, while a director of the Corporation, is
or was serving or who agrees to serve, at the request of the Corporation, as a
director, officer, partner, joint venture, employee or trustee of another
corporation, partnership, joint venture, trust, employee benefit plan or other
enterprise (including the heirs, executor, administrators or estate of such
person), shall be indemnified by the Corporation, and shall be entitled to have
paid on his behalf or be reimbursed for reasonable expenses in advance of final
disposition of a proceeding, in accordance with the 

                                      -17-
<PAGE>   18

Bylaws of the Corporation, to the full extent permitted from time to time by the
Maryland General Corporation Law as the same exists 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 said law
permitted the Corporation to provide prior to such amendment) or any other
applicable laws presently or hereafter in effect. The Corporation shall have the
power, with the approval of the Board of Directors, to provide such
indemnification and advancement of expenses to any employee or agent of the
Corporation, in accordance with the Bylaws of the Corporation. Without limiting
the generality or the effect of the foregoing, the Corporation may enter into
one or more agreements with any person which provide for indemnification greater
or different than that provided in this Article IX. Any amendment or repeal of
this Article IX shall not adversely affect any right or protection existing
hereunder immediately prior to such amendment or repeal.

                                    ARTICLE X
                    APPLICATION OF CERTAIN PROVISIONS OF LAW

        SECTION 1.    BUSINESS COMBINATIONS.

        Notwithstanding any other provision of this Charter or any contrary
provision of law, Title 3, subtitle 6 of the Corporations and Associations
Article of the Annotated Code of Maryland, as amended from time to time, or any
successor statute thereto, shall not apply to any "business combination" (as
defined in Section 3.601(d) of the Corporations and Associations Article of the
Annotated Code of Maryland, as amended from time to time, or any successor
statute thereto) involving the Corporation.

        SECTION 2.    CONTROL SHARE TRANSACTIONS.

        Notwithstanding any other provision of this Charter or any contrary
provision of law, Title 3, subtitle 7 of the Corporations and Associations
Article of the Annotated Code of Maryland, as amended from time to time, or any
successor statute thereto shall not apply to any acquisition of shares of stock
of the Corporation.

                                   ARTICLE XI
                                    AMENDMENT

        The Corporation reserves the right at any time and from time to time to
amend, alter, change or repeal any provision contained in its Charter and any
other provisions authorized by the laws of the State of Maryland at the time in
force may be added or inserted in the manner now or hereafter prescribed herein
or by applicable law, and all rights, preferences and privileges of whatsoever
nature conferred upon stockholder, directors or any other persons whomsoever by
and pursuant to this Charter in its present form or as hereafter amended are
granted subject to the rights reserved in this Article XI; provided, however,
that any amendment or repeal of Articles VIII, IX or this Article XI of this
Charter shall not adversely affect any right or protection existing hereunder
immediately prior to such amendment or repeal.



                                      -18-
<PAGE>   19


        IN WITNESS WHEREOF, these First Amended and Restated Articles of
Incorporation are hereby executed by Gary M. Ralston, the President of the
Corporation, who hereby acknowledges that the First Amended and Restated
Articles of Incorporation are the act of the Corporation, and who does hereby
state under the penalties of perjury that the matters and facts set forth herein
with respect to authorization and approval of such Articles are true in all
material respects to the best of his knowledge, information and belief.


Dated:  August 10, 1998


                                            By:    /s/ Gary M. Ralston
                                                   ----------------------------
                                                   Gary M. Ralston, President


ATTEST


By:     /s/ Kevin B. Habicht
        -----------------------------
        Kevin B. Habicht, Secretary



                                      -19-


