# EDGAR Filing Document

**Accession Number:** 0000752642
**File Stem:** 0001493152-25-011648
**Filing Date:** 2025-8
**Character Count:** 370263
**Document Hash:** 786f885c7401c41ad12a040f78d4f0fc
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001493152-25-011648.hdr.sgml**: 20250806

**ACCESSION NUMBER**: 0001493152-25-011648

**CONFORMED SUBMISSION TYPE**: 10-Q

**PUBLIC DOCUMENT COUNT**: 371

**CONFORMED PERIOD OF REPORT**: 20250630

**FILED AS OF DATE**: 20250806

**DATE AS OF CHANGE**: 20250806

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** UMH PROPERTIES, INC.
- **CENTRAL INDEX KEY:** 0000752642
- **STANDARD INDUSTRIAL CLASSIFICATION:** REAL ESTATE INVESTMENT TRUSTS [6798]
- **ORGANIZATION NAME:** 05 Real Estate & Construction
- **EIN:** 221890929
- **STATE OF INCORPORATION:** MD
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 10-Q
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-12690
- **FILM NUMBER:** 251189885

**BUSINESS ADDRESS:**
- **STREET 1:** 3499 ROUTE 9 N, SUITE 3-C
- **STREET 2:** JUNIPER BUSINESS PLAZA
- **CITY:** FREEHOLD
- **STATE:** NJ
- **ZIP:** 07728
- **BUSINESS PHONE:** 7325779997

**MAIL ADDRESS:**
- **STREET 1:** 3499 ROUTE 9 N, SUITE 3-C
- **STREET 2:** JUNIPER BUSINESS PLAZA
- **CITY:** FREEHOLD
- **STATE:** NJ
- **ZIP:** 07728

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** UNITED MOBILE HOMES INC
- **DATE OF NAME CHANGE:** 19920703

?xml version='1.0' encoding='ASCII'?

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 10-Q**

☒ QUARTERLY
 REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2025

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to ___________

Commission File Number <u>001-12690</u>

**<u>UMH PROPERTIES, INC.</u>**

(Exact name of registrant as specified in its charter)

---

| | |
|:---|:---|
| **<u>Maryland</u>** | **<u>22-1890929</u>** |
| (State or other jurisdiction of | (I.R.S. Employer |
| incorporation or organization) | identification number) |

---

---

| | |
|:---|:---|
| **<u>Juniper Business Plaza, 3499 Route 9 North, Suite 3-C, Freehold, NJ</u>** | **<u>07728</u>** |
| (Address of Principal Executive 0ffices) | (Zip Code) |
| Registrant's telephone number, including area code | **<u>(732) 577-9997</u>** |

---

(Former name, former address and former fiscal year, if changed since last report.)

Securities registered pursuant to Section 12(b) of the Act:

---

| | | |
|:---|:---|:---|
| <br> Title of each class | Trading Symbol(s) | Name of exchange on which registered |
| Common Stock, $0.10 par value | UMH | New York Stock Exchange |
| 6.375% Series D Cumulative Redeemable Preferred Stock, $0.10 par value | UMH PD | New York Stock Exchange |

---

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act:

Large accelerated filer ☒ Accelerated filer ☐ <br> Non-accelerated filer ☐ Smaller reporting company ☐ <br> Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date:

---

| | |
|:---|:---|
| **Class** | **Outstanding Common Shares as of August 1, 2025** |
| Common Stock, $0.10 par value per share | 84928979 |

---

**UMH PROPERTIES, INC. AND SUBSIDIARIES**

**FORM 10-Q**

**FOR THE QUARTER ENDED JUNE 30, 2025**

**Table of Contents**

---

| | | |
|:---|:---|:---|
| PART I - FINANCIAL INFORMATION | PART I - FINANCIAL INFORMATION |  |
| Item 1. | Financial Statements |  |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Consolidated Balance Sheets](#a_001) | 3 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Consolidated Statements of Income (Loss)](#a_002) | 5 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Consolidated Statements of Shareholders' Equity](#a_003) | 6 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Consolidated Statements of Cash Flows](#a_004) | 8 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[Notes To Consolidated Financial Statements](#a_005) | 9 |
| Item 2. | [Management's Discussion and Analysis of Financial Condition and Results of Operations](#a_006) | 29 |
| Item 3. | [Quantitative and Qualitative Disclosures About Market Risk](#a_007) | 41 |
| Item 4. | [Controls and Procedures](#a_008) | 41 |
| [PART II - OTHER INFORMATION](#a_009) | [PART II - OTHER INFORMATION](#a_009) | 42 |
| Item 1. | [Legal Proceedings](#a_010) | 42 |
| Item 1A. | [Risk Factors](#a_011) | 42 |
| Item 2. | [Unregistered Sales of Equity Securities and Use of Proceeds](#a_012) | 42 |
| Item 3. | [Defaults Upon Senior Securities](#a_013) | 42 |
| Item 4. | [Mine Safety Disclosures](#a_014) | 42 |
| Item 5. | [Other Information](#a_015) | 42 |
| Item 6. | [Exhibits](#a_016) | 42 |
| [SIGNATURES](#a_017) | [SIGNATURES](#a_017) | 43 |

---

**UMH PROPERTIES, INC. AND SUBSIDIARIES**

**CONSOLIDATED BALANCE SHEETS**

**AS OF JUNE 30, 2025 AND DECEMBER 31, 2024**

***<u>(in thousands except per share amounts)</u>***

---

| | | |
|:---|:---|:---|
|  | June 30, 2025 (Unaudited) | December 31, 2024 |
| **- ASSETS -** |  |  |
| **Investment Property and Equipment** |  |  |
| &nbsp;&nbsp;&nbsp;Land | $89588 | $88037 |
| &nbsp;&nbsp;&nbsp;Site and Land Improvements | 1008884 | 970053 |
| &nbsp;&nbsp;&nbsp;Buildings and Improvements | 45647 | 44782 |
| &nbsp;&nbsp;&nbsp;Rental Homes and Accessories | 596115 | 566242 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Investment Property | 1740234 | 1669114 |
| &nbsp;&nbsp;&nbsp;Equipment and Vehicles | 32148 | 31488 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Investment Property and Equipment | 1772382 | 1700602 |
| &nbsp;&nbsp;&nbsp;Accumulated Depreciation | (502132) | (471703) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net Investment Property and Equipment | 1270250 | 1228899 |
| **Other Assets** |  |  |
| &nbsp;&nbsp;&nbsp;Cash and Cash Equivalents | 79235 | 99720 |
| &nbsp;&nbsp;&nbsp;Marketable Securities at Fair Value | 30159 | 31883 |
| &nbsp;&nbsp;&nbsp;Inventory of Manufactured Homes | 38688 | 34982 |
| &nbsp;&nbsp;&nbsp;Notes and Other Receivables, net | 97639 | 91668 |
| &nbsp;&nbsp;&nbsp;Prepaid Expenses and Other Assets | 16420 | 14261 |
| &nbsp;&nbsp;&nbsp;Land Development Costs | 62057 | 33868 |
| &nbsp;&nbsp;&nbsp;Investment in Joint Ventures | 29574 | 28447 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Other Assets | 353772 | 334829 |
| **TOTAL ASSETS** | $1624022 | $1563728 |

---

See Accompanying Notes to Consolidated Financial Statements

**UMH PROPERTIES, INC. AND SUBSIDIARIES** 

**CONSOLIDATED BALANCE SHEETS – CONTINUED**

**AS OF JUNE 30, 2025 AND DECEMBER 31, 2024**

***<u>(in thousands except per share amounts)</u>***

---

| | | |
|:---|:---|:---|
|  | June 30, 2025 (Unaudited) | December 31, 2024 |
| **- LIABILITIES AND SHAREHOLDERS' EQUITY -** |  |  |
| **LIABILITIES:** |  |  |
| Mortgages Payable, net of unamortized debt issuance costs | $530193 | $485540 |
| Other Liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;Accounts Payable | 8527 | 7979 |
| &nbsp;&nbsp;&nbsp;Loans Payable, net of unamortized debt issuance costs | 27639 | 28279 |
| &nbsp;&nbsp;&nbsp;Series A Bonds, net of unamortized debt issuance costs | 101327 | 100903 |
| &nbsp;&nbsp;&nbsp;Accrued Liabilities and Deposits | 12125 | 15091 |
| &nbsp;&nbsp;&nbsp;Tenant Security Deposits | 10453 | 10027 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Other Liabilities | 160071 | 162279 |
| &nbsp;&nbsp;&nbsp;Total Liabilities | 690264 | 647819 |
| **Commitments and Contingencies** |  |  |
| **Shareholders' Equity:** |  |  |
| &nbsp;&nbsp;&nbsp;Series D – 6.375% Cumulative Redeemable Preferred Stock, $0.10 par value per share, 18,700 and 13,700 shares authorized as of June 30, 2025 and December 31, 2024 , respectively; 12,872 and 12,823 shares issued and outstanding as of June 30, 2025 and December 31, 2024, respectively | 321804 | 320572 |
| &nbsp;&nbsp;&nbsp;Common Stock - $0.10 par value per share, 183,714 and 163,714 shares authorized as of June 30, 2025 and December 31, 2024, respectively; 84,741 and 81,909 shares issued and outstanding as of June 30, 2025 and December 31, 2024, respectively | 8474 | 8191 |
| &nbsp;&nbsp;&nbsp;Excess Stock - $0.10 par value per share, 3,000 shares authorized; no shares issued or outstanding as of June 30, 2025 and December 31, 2024 | -0- | -0- |
| &nbsp;&nbsp;&nbsp;Additional Paid-In Capital | 627068 | 610630 |
| &nbsp;&nbsp;&nbsp;Accumulated Deficit | (25364) | (25364) |
| &nbsp;&nbsp;&nbsp;Total UMH Properties, Inc. Shareholders' Equity | 931982 | 914029 |
| &nbsp;&nbsp;&nbsp;Non-Controlling Interest in Consolidated Subsidiaries | 1776 | 1880 |
| &nbsp;&nbsp;&nbsp;Total Shareholders' Equity | 933758 | 915909 |
| **TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY** | $1624022 | $1563728 |

---

See Accompanying Notes to Consolidated Financial Statements

**UMH PROPERTIES, INC. AND SUBSIDIARIES** 

**CONSOLIDATED STATEMENTS OF INCOME (LOSS) (UNAUDITED)**

**FOR THE THREE AND SIX MONTHS ENDED**

**JUNE 30, 2025 AND 2024**

***(in thousands except per share amounts)***

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | THREE MONTHS ENDED | THREE MONTHS ENDED | SIX MONTHS ENDED | SIX MONTHS ENDED |
|  | June 30, 2025 | June 30, 2024 | June 30, 2025 | June 30, 2024 |
| **INCOME:** |  |  |  |  |
| Rental and Related Income | $56165 | $51494 | $110739 | $101823 |
| Sales of Manufactured Homes | 10478 | 8834 | 17129 | 16185 |
| &nbsp;&nbsp;&nbsp;**Total Income** | 66643 | 60328 | 127868 | 118008 |
| **EXPENSES:** |  |  |  |  |
| Community Operating Expenses | 23047 | 21595 | 46076 | 42692 |
| Cost of Sales of Manufactured Homes | 7124 | 5461 | 11469 | 11017 |
| Selling Expenses | 1847 | 1744 | 3462 | 3390 |
| General and Administrative Expenses | 6256 | 5506 | 12255 | 10874 |
| Depreciation Expense | 15739 | 15001 | 32402 | 29742 |
| &nbsp;&nbsp;&nbsp;**Total Expenses** | 54013 | 49307 | 105664 | 97715 |
| **OTHER INCOME (EXPENSE):** |  |  |  |  |
| Interest Income | 2060 | 1501 | 4323 | 3068 |
| Dividend Income | 375 | 362 | 749 | 722 |
| Loss on Sales of Marketable Securities, net | -0- | (3778) | -0- | (3778) |
| Increase (Decrease) in Fair Value of Marketable Securities | (175) | 3338 | (1737) | (2031) |
| Other Income | 252 | 205 | 429 | 364 |
| Loss on Investment in Joint Ventures | (133) | (87) | (214) | (224) |
| Interest Expense | (7368) | (7371) | (13302) | (14845) |
| &nbsp;&nbsp;&nbsp;**Total Other Income (Expense)** | (4989) | (5830) | (9752) | (16724) |
| Income before Loss on Sales of Investment Property and Equipment | 7641 | 5191 | 12452 | 3569 |
| Loss on Sales of Investment Property and Equipment | (36) | (10) | (37) | (13) |
| &nbsp;&nbsp;&nbsp;**Net Income** | 7605 | 5181 | 12415 | 3556 |
| Preferred Dividends | (5129) | (4712) | (10258) | (9385) |
| Loss Attributable to Non-Controlling Interest | 56 | 58 | 104 | 92 |
| &nbsp;&nbsp;&nbsp;**Net Income (Loss) Attributable to Common Shareholders** | $2532 | $527 | $2261 | $(5737) |
| **Net Income (Loss) Attributable to Common Shareholders Per Share – Basic and Diluted** | $0.03 | $0.01 | $0.03 | $(0.08) |
| **Weighted Average Common Shares Outstanding:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Basic | 83974 | 71418 | 83233 | 70291 |
| &nbsp;&nbsp;&nbsp;Diluted | 84779 | 71884 | 84051 | 70700 |

---

See Accompanying Notes to Consolidated Financial Statements

**UMH PROPERTIES, INC. AND SUBSIDIARIES**

**CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (UNAUDITED)**

**FOR THE THREE AND SIX MONTHS ENDED**

**JUNE 30, 2025 AND 2024**

***<u>(in thousands)</u>***

 ****

---

| | | | |
|:---|:---|:---|:---|
|  | **Common Stock** | **Common Stock** | |
|  | **Issued and Outstanding** | **Issued and Outstanding** | |
|  | **Number** | **Amount** | **Preferred**<br>**Stock**<br>**Series D** |
| Balance December 31, 2024 | 81909 | $8191 | $320572 |
| Common Stock Issued with the DRIP | 152 | 16 | -0- |
| Common Stock Issued through Restricted Stock Awards | 224 | 22 | -0- |
| Common Stock Issued through Stock Options | 25 | 2 | -0- |
| Common Stock Issued in connection with At-The-Market Offerings, net | 515 | 52 | -0- |
| Preferred Stock Issued in connection with At-The-Market Offerings, net | -0- | -0- | 1232 |
| Distributions | -0- | -0- | -0- |
| Stock Compensation | -0- | -0- | -0- |
| Net Income (Loss) | -0- | -0- | -0- |
| Balance March 31, 2025 | 82825 | 8283 | 321804 |
| Common Stock Issued with the DRIP | 136 | 13 | -0- |
| Common Stock Issued through Restricted Stock Awards | 9 | 1 | -0- |
| Common Stock Issued through Stock Options | 10 | 1 | -0- |
| Common Stock Issued in connection with At-The-Market Offerings, net | 1761 | 176 | -0- |
| Distributions | -0- | -0- | -0- |
| Stock Compensation Expense | -0- | -0- | -0- |
| Net Income (Loss) | -0- | -0- | -0- |
| Balance June 30, 2025 | 84741 | $8474 | $321804 |
| Balance December 31, 2023 | 67978 | $6798 | $290180 |
| Common Stock Issued with the DRIP | 168 | 16 | -0- |
| Common Stock Issued through Restricted Stock Awards | 481 | 48 | -0- |
| Common Stock Issued through Stock Options | 179 | 18 | -0- |
| Common Stock Issued in connection with At-The-Market Offerings, net | 1347 | 135 | -0- |
| Preferred Stock Issued in connection with At-The-Market Offerings, net | -0- | -0- | 4855 |
| Distributions | -0- | -0- | -0- |
| Stock Compensation | -0- | -0- | -0- |
| Net Loss | -0- | -0- | -0- |
| Balance March 31, 2024 | 70153 | 7015 | 295035 |
| Common Stock Issued with the DRIP | 172 | 17 | -0- |
| Common Stock Issued through Restricted Stock Awards | 9 | 1 | -0- |
| Common Stock Issued through Stock Options | 31 | 3 | -0- |
| Common Stock Issued in connection with At-The-Market Offerings, net | 2385 | 239 | -0- |
| Preferred Stock Issued in connection with At-The-Market Offerings, net | -0- | -0- | 722 |
| Distributions | -0- | -0- | -0- |
| Stock Compensation Expense | -0- | -0- | -0- |
| Net Income (Loss) | -0- | -0- | -0- |
| Balance June 30, 2024 | 72750 | $7275 | $295757 |

---

See Accompanying Notes to Consolidated Financial Statements

**UMH PROPERTIES, INC. AND SUBSIDIARIES**

**CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (UNAUDITED)**

**FOR THE THREE AND SIX MONTHS ENDED**

**JUNE 30, 2025 AND 2024**

***<u>(in thousands)</u>***

 ****

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Additional Paid-In**<br>**Capital** | **Undistributed Income (Accumulated**<br>**Deficit)** | **Non-Controlling Interest in Consolidated**<br>**Subsidiary** | **Total Shareholders'**<br>**Equity** |
| Balance December 31, 2024 | $610630 | $(25364) | $1880 | $915909 |
| Common Stock Issued with the DRIP | 2596 | -0- | -0- | 2612 |
| Common Stock Issued through Restricted Stock Awards | (22) | -0- | -0- | -0- |
| Common Stock Issued through Stock Options | 352 | -0- | -0- | 354 |
| Common Stock Issued in connection with At-The-Market Offerings, net | 9185 | -0- | -0- | 9237 |
| Preferred Stock Issued in connection with At-The-Market Offerings, net | (250) | -0- | -0- | 982 |
| Distributions | (18000) | (4858) | -0- | (22858) |
| Stock Compensation Expense | 3149 | -0- | -0- | 3149 |
| Net Income (Loss) | -0- | 4858 | (48) | 4810 |
| Balance March 31, 2025 | 607640 | (25364) | 1832 | 914195 |
| Common Stock Issued with the DRIP | 2192 | -0- | -0- | 2205 |
| Common Stock Issued through Restricted Stock Awards | (1) | -0- | -0- | -0- |
| Common Stock Issued through Stock Options | 136 | -0- | -0- | 137 |
| Common Stock Issued in connection with At-The-Market Offerings, net | 30152 | -0- | -0- | 30328 |
| Distributions | (16402) | (7661) | -0- | (24063) |
| Stock Compensation Expense | 3351 | -0- | -0- | 3351 |
| Net Income (Loss) | -0- | 7661 | (56) | 7605 |
| Balance June 30, 2025 | $627068 | $(25364) | $1776 | $933758 |
| Balance December 31, 2023 | $433106 | $(25364) | $2074 | $706794 |
| Common Stock Issued with the DRIP | 2455 | -0- | -0- | 2471 |
| Common Stock Issued through Restricted Stock Awards | (48) | -0- | -0- | -0- |
| Common Stock Issued through Stock Options | 1748 | -0- | -0- | 1766 |
| Common Stock Issued in connection with At-The-Market Offerings, net | 20260 | -0- | -0- | 20395 |
| Preferred Stock Issued in connection with At-The-Market Offerings, net | (456) | -0- | -0- | 4399 |
| Distributions | (20479) | 1591 | -0- | (18888) |
| Stock Compensation Expense | 1845 | -0- | -0- | 1845 |
| Net Loss | -0- | (1591) | (34) | (1625) |
| Balance March 31, 2024 | 438431 | (25364) | 2040 | 717157 |
| Common Stock Issued with the DRIP | 2548 | -0- | -0- | 2565 |
| Common Stock Issued through Restricted Stock Awards | (1) | -0- | -0- | -0- |
| Common Stock Issued through Stock Options | 310 | -0- | -0- | 313 |
| Common Stock Issued in connection with At-The-Market Offerings, net | 35844 | -0- | -0- | 36083 |
| Preferred Stock Issued in connection with At-The-Market Offerings, net | (63) | -0- | -0- | 659 |
| Distributions | (14622) | (5239) | -0- | (19861) |
| Stock Compensation Expense | 1883 | -0- | -0- | 1883 |
| Net Income (Loss) | -0- | 5239 | (58) | 5181 |
| Balance June 30, 2024 | $464330 | $(25364) | $1982 | $743980 |

---

See Accompanying Notes to Consolidated Financial Statements

**UMH PROPERTIES, INC. AND SUBSIDIARIES**

**CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)**

**FOR THE SIX MONTHS ENDED**

**JUNE 30, 2025 AND 2024**

***<u>(in thousands)</u>***

 ****

---

| | | |
|:---|:---|:---|
|  | SIX MONTHS ENDED | SIX MONTHS ENDED |
|  | June 30, 2025 | June 30, 2024 |
| **CASH FLOWS FROM OPERATING ACTIVITIES:** |  |  |
| Net Income | $12415 | $3556 |
| Non-Cash items included in Net Income: |  |  |
| &nbsp;&nbsp;&nbsp;Depreciation | 32402 | 29742 |
| &nbsp;&nbsp;&nbsp;Amortization of Financing Costs | 1246 | 1163 |
| &nbsp;&nbsp;&nbsp;Stock Compensation Expense | 3619 | 2543 |
| &nbsp;&nbsp;&nbsp;Provision for Uncollectible Notes and Other Receivables | 845 | 795 |
| &nbsp;&nbsp;&nbsp;Loss on Sales of Marketable Securities, net | -0- | 3778 |
| &nbsp;&nbsp;&nbsp;Decrease in Fair Value of Marketable Securities | 1737 | 2031 |
| &nbsp;&nbsp;&nbsp;Loss on Sales of Investment Property and Equipment | 37 | 13 |
| &nbsp;&nbsp;&nbsp;Loss on Investment in Joint Ventures | 410 | 469 |
| Changes in Operating Assets and Liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;Inventory of Manufactured Homes | (3706) | 954 |
| &nbsp;&nbsp;&nbsp;Notes and Other Receivables, net of notes acquired with acquisitions | (6816) | (5664) |
| &nbsp;&nbsp;&nbsp;Prepaid Expenses and Other Assets | (3002) | 552 |
| &nbsp;&nbsp;&nbsp;Accounts Payable | 548 | (720) |
| &nbsp;&nbsp;&nbsp;Accrued Liabilities and Deposits | (2966) | (1972) |
| &nbsp;&nbsp;&nbsp;Tenant Security Deposits | 426 | 365 |
| Net Cash Provided by Operating Activities | 37195 | 37605 |
| **CASH FLOWS FROM INVESTING ACTIVITIES:** |  |  |
| &nbsp;&nbsp;&nbsp;Purchase of Manufactured Home Communities | (25367) | -0- |
| &nbsp;&nbsp;&nbsp;Purchase of Investment Property and Equipment | (50494) | (41052) |
| &nbsp;&nbsp;&nbsp;Proceeds from Sales of Investment Property and Equipment | 2072 | 2348 |
| &nbsp;&nbsp;&nbsp;Additions to Land Development Costs | (25308) | (18249) |
| &nbsp;&nbsp;&nbsp;Purchase of Marketable Securities through automatic reinvestments | (13) | (12) |
| &nbsp;&nbsp;&nbsp;Proceeds from Sales of Marketable Securities | -0- | 36 |
| &nbsp;&nbsp;&nbsp;Investment in Joint Ventures | (1538) | (1829) |
| Net Cash Used in Investing Activities | (100648) | (58758) |
| **CASH FLOWS FROM FINANCING ACTIVITIES:** |  |  |
| &nbsp;&nbsp;&nbsp;Proceeds from Mortgages, net of mortgages assumed | 101392 | -0- |
| &nbsp;&nbsp;&nbsp;Net Payments from Short-Term Borrowings | (928) | (15837) |
| &nbsp;&nbsp;&nbsp;Principal Payments of Mortgages and Loans | (55194) | (5915) |
| &nbsp;&nbsp;&nbsp;Financing Costs on Debt | (2079) | (552) |
| &nbsp;&nbsp;&nbsp;Proceeds from At-The-Market Preferred Equity Program, net of offering costs | 982 | 5058 |
| &nbsp;&nbsp;&nbsp;Proceeds from At-The-Market Common Equity Program, net of offering costs | 39565 | 56478 |
| &nbsp;&nbsp;&nbsp;Proceeds from Issuance of Common Stock in the DRIP, net of dividend reinvestments | 3131 | 3503 |
| &nbsp;&nbsp;&nbsp;Proceeds from Exercise of Stock Options | 491 | 2079 |
| &nbsp;&nbsp;&nbsp;Preferred Dividends Paid | (10258) | (9385) |
| &nbsp;&nbsp;&nbsp;Common Dividends Paid, net of dividend reinvestments | (34977) | (27831) |
| Net Cash Provided by Financing Activities | 42125 | 7598 |
| Net Decrease in Cash, Cash Equivalents and Restricted Cash | (21328) | (13555) |
| Cash, Cash Equivalents and Restricted Cash at Beginning of Period | 108811 | 64437 |
| **CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD** | $87483 | $50882 |

---

See Accompanying Notes to Consolidated Financial Statements

**UMH PROPERTIES, INC. AND SUBSIDIARIES**

**NOTES TO CONSOLIDATED FINANCIAL STATEMENTS**

**JUNE 30, 2025 (UNAUDITED)**

<u>NOTE 1 – ORGANIZATION AND ACCOUNTING POLICIES</u>

UMH Properties, Inc., a Maryland corporation, and its subsidiaries ("we", "our", "us" or "the Company") operates as a real estate investment trust ("REIT") deriving its income primarily from real estate rental operations. As of June 30, 2025, the Company operated 142 manufactured home communities containing approximately 26,600 developed homesites, on which approximately 10,600 Company-owned rental homes are situated. The 142 communities include two communities in central Florida (Sebring Square and Rum Runner) and one community in Pennsylvania (Honey Ridge, which opened for occupancy in June 2025 and was not previously included in our community count) owned through a joint venture with Nuveen Real Estate in which the Company has a 40% interest and also include two communities acquired through the Company's qualified opportunity zone fund (See Note 6). These 142 communities are located in New Jersey, New York, Ohio, Pennsylvania, Tennessee, Indiana, Maryland, Michigan, Alabama, South Carolina, Florida and Georgia. Subsequent to quarter end, on July 2, 2025, the Company acquired two manufactured home communities containing 191 developed homesites, located in Conowingo, Maryland, for a total purchase price of $14.6 million (See Note 13). Including these acquisitions, the Company now operates 144 communities containing approximately 26,800 developed homesites.

The Company, through its wholly-owned taxable subsidiary, UMH Sales and Finance, Inc. ("S&F"), sells manufactured homes to residents and prospective residents in our communities. Inherent in the operations of manufactured home communities are site vacancies. S&F was established to enhance the value of the communities by helping to fill these vacancies through the sales of homes. The Company holds a 77% controlling interest in its qualified opportunity zone fund which it created in 2022 to acquire, develop and redevelop manufactured housing communities located in areas designated as Qualified Opportunity Zones by the U.S. Treasury Department to encourage long-term investment in economically distressed areas. The consolidated financial statements of the Company include S&F and all of its other wholly-owned subsidiaries and its qualified opportunity zone fund. All intercompany transactions and balances have been eliminated in consolidation.

The primary focus of our business is the operation of our manufactured home communities – leasing of manufactured homesites and manufactured homes in our communities. The sale of homes is integrated with our leasing of these manufactured homes and homesites. Management views the Company's business as a single segment based on its method of internal reporting in addition to its allocation of capital and resources. Capital and resources are allocated to further the goal of maintaining and increasing occupancy and net operating income in our communities. Our chief executive officer, with the assistance of our chief operating officer, is the principal decision-maker regarding allocation of resources. These decisions are based on the occupancy of the communities and community net operating income. Sales of homes are necessary to maintain and increase occupancy at our communities. We primarily purchase homes to fill vacant sites in the communities. These homes are either rented or sold, based on the needs of the potential residents. Although certain components of the sales operation are tracked (sales, cost of sales, etc.), separate discrete financial information for the entire sales operation is not available. Most of the personnel costs, office expenses, maintenance and other expenses are borne by the community and cannot be allocated. The components of the sales operation play no material role in decisions about resources to be allocated. Resources are allocated to maintaining and increasing occupancy and net operating income in our communities.

The Company has elected to be taxed as a REIT under Sections 856-860 of the Internal Revenue Code (the "Code") and intends to maintain its qualification as a REIT in the future. As a qualified REIT, with limited exceptions, the Company will not be taxed under federal and certain state income tax laws at the corporate level on taxable income that it distributes to its shareholders. For special tax provisions applicable to REITs, refer to Sections 856-860 of the Code. The Company is subject to franchise taxes in some of the states in which the Company owns property.

The interim consolidated financial statements furnished herein have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") applicable to interim financial information, the instructions to Form 10-Q, and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company's annual report on Form 10-K for the year ended December 31, 2024.

*<u>Use of Estimates</u>*

In preparing the consolidated financial statements in accordance with U.S. GAAP, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities, as well as contingent assets and liabilities as of the dates of the consolidated balance sheets and revenue and expenses for the years then ended. These estimates and assumptions include the allowance for doubtful accounts, valuation of inventory, depreciation, valuation of securities, accounting for land development, reserves and accruals, and stock compensation expense. Actual results could differ from these estimates and assumptions.

*<u>Reclassifications</u>*

Certain amounts in the financial statements for the prior periods have been reclassified to conform to the statement presentation for the current periods.

 

*<u>Investment in Joint Ventures</u>*

The Company accounts for its investment in entities formed under its joint ventures with Nuveen Real Estate under the equity method of accounting in accordance with ASC 323, Investments – Equity Method and Joint Ventures. The Company has the ability to exercise significant influence, but not control, over the operating and financial decisions of the joint venture entities. Under the equity method of accounting, the cost of an investment is adjusted for the Company's share of the equity in net income or loss from the date of acquisition, reduced by distributions received and increased by contributions made. The income or loss is allocated in accordance with the provisions of the operating agreement. The carrying value of the investment in the joint ventures are reviewed for other than temporary impairment whenever events or changes in circumstances indicate a possible impairment. Financial condition, operational performance, and other economic trends are among the factors that are considered in evaluation of the existence of impairment indicators (See Note 5).

*<u>Leases</u>*

We account for our leases under ASC 842, "Leases." Our primary source of revenue is generated from lease agreements for our sites and homes, where we are the lessor. These leases are generally for one-year or month-to-month terms and renewable by mutual agreement from us and the resident, or in some cases, as provided by jurisdictional statute.

We are the lessee in other arrangements, primarily for our corporate office and a ground lease at one community. As of June 30, 2025 and December 31, 2024, the right-of-use assets and corresponding lease liabilities of $2.8 million and $3.0 million, respectively, are included in prepaid expenses and other assets and accrued liabilities and deposits on the consolidated balance sheets.

Future minimum lease payments under these leases over the remaining lease terms are as follows *(in thousands)*:

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| | |
|:---|:---|
| 2025 | $230 |
| 2026 | 460 |
| 2027 | 257 |
| 2028 | 111 |
| 2029 | 111 |
| Thereafter | 18392 |
| Total Lease Payments | $19561 |

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The weighted average remaining lease term for these leases, including renewal options, is 164 years. The right of use assets and lease liabilities was calculated using an interest rate of 5%.

*<u>Restricted Cash</u>*

The Company's restricted cash consists of amounts primarily held in deposit for tax, insurance and repair escrows held by lenders in accordance with certain debt agreements. Restricted cash is included in prepaid expenses and other assets on the consolidated balance sheets.

The following table presents beginning of period and end of period balances of cash, cash equivalents and restricted cash for the periods shown *(in thousands)*:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | 6/30/25 | 12/31/24 | 6/30/24 | 12/31/23 |
| Cash and Cash Equivalents | $79235 | $99720 | $39457 | $57320 |
| Restricted Cash | 8248 | 9091 | 11425 | 7117 |
| Cash, Cash Equivalents And Restricted Cash | $87483 | $108811 | $50882 | $64437 |

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*<u>Revenue Recognition</u>*

We account for our Sales of Manufactured Homes in accordance with Accounting Standards Update ("ASU") 2014-09 "Revenue from Contracts with Customers (Topic 606)" (ASC 606). For transactions in the scope of ASC 606, we recognize revenue when control of goods or services transfers to the customer, in the amount that we expect to receive for the transfer of goods or provision of services.

Rental and related income is generated primarily from lease agreements for our sites and homes. The lease component of these agreements is accounted for under ASC 842 "Leases." The non-lease components of our lease agreements consist primarily of utility reimbursements, which are accounted for with the site lease as a single lease under ASC 842.

Revenue from sales of manufactured homes is recognized in accordance with the core principle of ASC 606, at the time of closing when control of the home transfers to the customer. After closing of the sale transaction, we generally do not have any remaining performance obligations.

Interest income is primarily from notes receivables for the previous sales of manufactured homes. Interest income on these receivables is accrued based on the unpaid principal balances of the underlying loans on a level yield basis over the life of the loans.

Dividend income and gain (loss) on sales of marketable securities are from our investments in marketable securities and are presented separately but are not in the scope of ASC 606.

Other income primarily consists of brokerage commissions for arranging for the sale of a home by a third party and other miscellaneous income. This income is recognized when the transactions are completed and our performance obligations have been fulfilled.

*<u>Notes Receivables</u>*

We account for our receivables in accordance with ASU No. 2016-13, "Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments." ASU 2016-13 requires that entities use a forward looking "expected loss" model that generally will result in the earlier recognition of allowance for credit losses. The measurement of expected credit losses is based upon historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. As of June 30, 2025 and December 31, 2024, the Company had notes receivable of $93.4 million and $87.4 million, net of the fair value adjustment of $1.9 million and $1.8 million, respectively. Notes receivables are presented as a component of notes and other receivables, net on our consolidated balance sheets. These receivables represent balances owed to us for previously completed performance obligations for sales of manufactured homes.

*<u>Recent Accounting Pronouncements</u>*

On November 4, 2024, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") 2024-03 - Income Statement – Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40). ASU 2024-03 requires disaggregated disclosure of income statement expenses for public business entities (PBEs). The ASU does not change the expense captions an entity presents on the face of the income statement; rather, it requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements. This ASU is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027 and should be applied either (1) prospectively to financial statements issued for reporting periods after the effective date of this ASU or (2) retrospectively to any or all prior periods presented in the financial statements. Early adoption is permitted. The Company anticipates making the required disclosures beginning with its Form 10-K for the year ending December 31, 2027.

Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying consolidated financial statements.

<u>NOTE 2 – NET INCOME (LOSS) PER SHARE</u> 

Basic Net Income (Loss) per Share is calculated by dividing Net Income (Loss) by the weighted average shares outstanding for the period. Diluted Net Income (Loss) per Share is calculated by dividing Net Income (Loss) less Income (Loss) Attributable to Non-Controlling Interest by the weighted average number of common shares outstanding, and when dilutive, the potential net shares that would be issued upon exercise of stock options pursuant to the treasury stock method. In periods with a net loss, the diluted loss per share equals the basic loss per share as all common stock equivalents are excluded from the per share calculation because they are anti-dilutive.

For the three and six months ended June 30, 2025, common stock equivalents resulting from employee stock options to purchase 6.3 million shares of common stock amounted to 805,000 shares and 818,000 shares, respectively, which were included in the computation of Diluted Net Income per Share. For the three months ended June 30, 2024, common stock equivalents resulting from employee stock options to purchase 4.0 million shares of common stock amounted to 466,000 shares, which were included in the computation of Diluted Net Income per Share. For the six months ended June 30, 2024, common stock equivalents of 409,000 shares were excluded from the computation of Diluted Net Loss per Share as their effect would be anti-dilutive.

<u>NOTE 3 – INVESTMENT PROPERTY AND EQUIPMENT</u>

*<u>Acquisitions</u>*

On March 24, 2025, the Company acquired two age-restricted communities, Cedar Grove and Maplewood Village, located in Mantua, New Jersey, for approximately $24.6 million. These communities contain a total of 266 newly developed homesites, which are 100% occupied. They are situated on approximately 38 total acres.

The Company has evaluated this acquisition and has determined that it should be accounted for as an acquisition of assets. As such, we have allocated the total cash consideration, including transaction costs of approximately $767,000 for the six months ended June 30, 2025, to the individual assets acquired on a relative fair value basis. The following table summarizes our purchase price allocation for the assets acquired for the six months ended June 30, 2025 (*in thousands*):

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| | |
|:---|:---|
|  | **At Acquisition Date** |
| **Assets Acquired:** |  |
| Land | $1448 |
| Depreciable Property | 23919 |
| **Total Assets Acquired** | $25367 |

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See Note 14 for the Unaudited Pro Forma Financial Information relating to this acquisition.

Subsequent to quarter end, on July 2, 2025, the Company acquired two communities, Conowingo Court and Maybelle Manor, located in Conowingo, Maryland, for approximately $14.6 million (See Note 13). These communities contain a total of 191 newly developed homesites, which are 79% occupied. They are situated on approximately 82 total acres.

<u>NOTE 4 – MARKETABLE SECURITIES</u>

The Company's marketable securities consist primarily of marketable common and preferred stock of other REITs with a fair value of $30.2 million as of June 30, 2025, which represents 1.4% of undepreciated assets (total assets excluding accumulated depreciation). The Company does not intend to increase its investments in this REIT securities portfolio. The REIT securities portfolio provides the Company with additional diversification, liquidity and income.

As of June 30, 2025, the Company had total net unrealized losses of $40.3 million in its REIT securities portfolio. For the three and six months ended June 30, 2025, the Company recorded a decrease of $175,000 and $1.7 million, respectively, in the fair value of these marketable securities. The Company held eight securities that had unrealized losses as of June 30, 2025.

<u>NOTE 5 – INVESTMENT IN JOINT VENTURES</u>

In December 2021, the Company and Nuveen Real Estate ("Nuveen" or "Nuveen Real Estate"), established a joint venture for the purpose of acquiring manufactured housing and/or recreational vehicle communities that are under development and/or newly developed and meet certain other investment guidelines. The terms of the initial joint venture entity were set forth in a Limited Liability Company Agreement dated as of December 8, 2021 (the "LLC Agreement") entered into between a wholly owned subsidiary of the Company and an affiliate of Nuveen. The LLC Agreement provided for the parties to initially fund up to $70 million of equity capital for acquisitions during a 24-month commitment period, with Nuveen having the option, subject to certain conditions, to elect to increase the parties' total commitments by up to an additional $100 million and to extend the commitment period for up to an additional four years. The LLC Agreement called for committed capital to be funded 60% by Nuveen and 40% by the Company on a parity basis. The Company serves as managing member of the joint venture entity and is responsible for day-to-day operations of the joint venture entity and management of its properties, subject to obtaining approval of Nuveen Real Estate for major decisions (including investments, dispositions, financings, major capital expenditures and annual budgets). The Company receives property management, asset management and other fees from the joint venture entity. In addition, once each member has recouped its invested capital and received a 7.5% net unlevered internal rate of return, 80% of distributable cash will be allocated pro rata in accordance with the members' respective percentage interests and the Company and Nuveen will receive a promote percentage equal to 70% (in the case of the Company) and 30% (in the case of Nuveen) of the remaining 20% of distributable cash. After 7 years the Company may elect to consummate the crystallization of the promote.

Under the terms of the LLC Agreement, after December 8, 2024 or, if later, the second anniversary of the acquisition and placing in service of a manufactured housing or recreational vehicle community, Nuveen will have a right to initiate the sale of one or more of the communities owned by the joint venture entity. If Nuveen elects to initiate such a sale process, the Company may exercise a right of first refusal to acquire Nuveen's interest in the community or communities to be sold for a purchase price corresponding to the greater of the appraised value of such communities or the amount required to provide a 7.5% net unlevered internal rate of return on Nuveen's investment. In addition, the Company will have the right to buy out Nuveen's interest in the joint venture entity at any time after December 8, 2031 at a purchase price corresponding to the greater of the appraised value of the portfolio or the amount required to provide a 7.5% net unlevered internal rate of return on Nuveen's investment.

The LLC Agreement between the Company and Nuveen provided that until the capital contributions to the joint venture are fully funded or the joint venture is terminated, the joint venture will be the exclusive vehicle for the Company to acquire any manufactured housing communities and/or recreational vehicle communities that meet the joint venture's investment guidelines. These guidelines called for the joint venture to acquire manufactured housing and recreational vehicle communities that have been developed within the previous two years and are less than 20% occupied, are located in certain geographic markets, are projected to meet certain cash flow and internal rate of return targets, and satisfy certain other criteria. The Company agreed to offer Nuveen the opportunity to have the joint venture acquire any manufactured housing community or recreational vehicle community that meets these investment guidelines. Under the terms of the LLC Agreement, if Nuveen determines not to pursue or approve any such acquisition, the Company would be permitted to acquire the property outside the joint venture. Since the execution of the LLC Agreement, Nuveen has provided the Company with written waivers of the exclusivity provision of the LLC Agreement with regard to two property acquisitions that may have fit the investment guidelines of the joint venture, which permitted the Company to acquire them outside of the Nuveen joint venture. Except for investment opportunities that are offered to and declined by Nuveen, the Company is prohibited from developing, owning, operating or managing manufactured housing communities or recreational vehicle communities within a 10-mile radius of any community owned by the joint venture. However, this restriction does not apply with respect to investments by the Company in existing communities operated by the Company.

The LLC Agreement provides that Nuveen will have the right to remove and replace the Company as managing member of the joint venture and manager of the joint venture's properties if the Company breaches certain obligations or certain events occur. Upon such removal, Nuveen may elect to buy out the Company's interest in the joint venture at 98% of the value of the Company's interest in the joint venture. If Nuveen does not exercise such buy-out right, the Company may, at specified times, elect to initiate a sale of the communities owned by the joint venture, subject to a right of first refusal on the part of Nuveen. The LLC Agreement contains restrictions on a party's right to transfer its interest in the joint venture without the approval of the other party.

The LLC Agreement requires the Company to offer Nuveen the opportunity to have the joint venture acquire a manufactured housing community or recreational vehicle community that meets the investment guidelines. If Nuveen decides not to acquire the community through the joint venture, however, the Company is free to purchase the community on its own outside of the joint venture.

In December 2021, the joint venture entity closed on the acquisition of Sebring Square, a newly developed all-age, manufactured home community located in Sebring, Florida, for a total purchase price of $22.2 million. This community contains 219 developed homesites situated on approximately 39 acres. In December 2022, the joint venture entity closed on the acquisition of Rum Runner, another newly developed all-age, manufactured home community also located in Sebring, Florida for a total purchase price of $15.1 million. This community contains 144 developed homesites situated on approximately 20 acres. The Company manages these communities on behalf of the joint venture entity.

During the time since the joint venture with Nuveen was first established in 2021, the Company and Nuveen have continued to seek opportunities to acquire additional manufactured housing and/or recreational vehicle communities that are under development and/or newly developed and meet certain other investment guidelines. During 2022, the Company and Nuveen informally agreed that any future acquisitions would be made by one or more new joint venture entities to be formed for that purpose and that the original joint venture entity formed in December 2021 will not consummate additional acquisitions but will maintain its existing property portfolio, consisting of the Sebring Square and Rum Runner communities. The Company and Nuveen also informally agreed that, unless otherwise determined in connection with any specific future investment, capital for any such new joint venture entity would continue to be funded 60% by Nuveen and 40% by the Company on a parity basis and that other terms would be similar to those of the LLC Agreement entered into in 2021, except that the amounts of the parties' respective capital commitments will be determined on a property-by-property basis.

In November 2023, the Company expanded its relationship with Nuveen Real Estate and formed a new joint venture entity with Nuveen. The new joint venture entity was established to, directly or through one or more subsidiaries, identify, source, originate, acquire, hold, operate, sell, lease, mortgage, maintain, own, manage, finance, refinance, reposition, improve, renovate, develop, redevelop, pledge, hedge, exchange, and otherwise deal in and with the rental of manufactured housing and/or recreational vehicle communities that meet other investment guidelines. The terms of the new joint venture entity are set forth in a Limited Liability Company Agreement dated as of November 29, 2023 (the "Second LLC Agreement") entered into between a wholly owned subsidiary of the Company and an affiliate of Nuveen. The Company serves as managing member of this new joint venture entity and is responsible for day-to-day operations of the joint venture entity and management of its properties, subject to obtaining approval of Nuveen Real Estate for major decisions (including investments, dispositions, financings, major capital expenditures and annual budgets). The Company receives property management oversight, development and other fees from the joint venture entity. Sixty-one acres of land located in Honey Brook, Pennsylvania, previously owned by the Company, with a carrying value cost basis of $3.8 million, was contributed to the new joint venture entity. The Company was reimbursed by Nuveen for 60% of the carrying value of this land. This new joint venture entity is focused on the development of a new manufactured housing community on this property. The community contains 113 manufactured home sites situated on approximately 61 acres. This community, named Honey Ridge, opened for occupancy in June 2025 with 16 homes on-site of which five have been sold or have pending offers to be sold.

References in this report to the Company's joint venture relationships with Nuveen are intended to refer to its ongoing relationships with Nuveen.

The Company accounts for its joint ventures with Nuveen Real Estate under the equity method of accounting in accordance with ASC 323, "Investments – Equity Method and Joint Ventures".

<u>NOTE 6 – OPPORTUNITY ZONE FUND</u>

In July 2022, the Company invested $8.0 million, representing a portion of the capital gain the Company recognized as a result of the Monmouth Real Estate Investment Corp. ("MREIC") merger, in the UMH OZ Fund, LLC ("OZ Fund"), a new entity formed by the Company. The OZ Fund was created to acquire, develop and redevelop manufactured housing communities requiring substantial capital investment and located in areas designated as Qualified Opportunity Zones by the Treasury Department pursuant to a program authorized under the 2017 Tax Cuts and Jobs Act to encourage long-term investment in economically distressed areas. The OZ Fund was designed to allow the Company and other investors in the OZ Fund to defer the tax on recently realized capital gains reinvested in the OZ Fund until December 31, 2026 and to potentially obtain certain other tax benefits. UMH manages the OZ Fund and will receive certain management fees as well as a 15% carried interest in distributions by the OZ Fund to the other investors (subject to first returning investor capital with a 5% preferred return). UMH will have a right of first offer to purchase the communities from the OZ Fund at the time of sale at their then-current appraised value. On August 10, 2022, the Company, through the OZ Fund, acquired Garden View Estates, located in Orangeburg, South Carolina, for approximately $5.2 million. On January 19, 2023, the Company, through the OZ Fund, acquired Mighty Oak, located in Albany, Georgia, for approximately $3.7 million. As of June 30, 2025, the Company's investment in the OZ Fund represented 77% of the total capital contributed to the OZ Fund and is consolidated in the Company's Consolidated Financial Statements. Other investors in the OZ Fund include certain officers, directors and employees of the Company.

<u>NOTE 7 – LOANS AND MORTGAGES PAYABLE AND OTHER LONG-TERM INDEBTEDNESS</u>

 

*<u>Loans Payable</u>*

The following is a summary of our loans payable as of June 30, 2025 and December 31, 2024 *(in thousands)*:

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  |  | 6/30/2025 | 6/30/2025 | 12/31/2024 | 12/31/2024 |
|  |  | Amount | Rate | Amount | Rate |
| Margin Loan | (1) | $-0- | N/A | $-0- | N/A |
| Unsecured revolving credit facility | (2) | -0- | N/A | -0- | N/A |
| Floorplan inventory financing | (3) | 4901 | 7.86% | 5479 | 8.27% |
| FirstBank rental home loan | (4) | 23684 | 6.15% | 24033 | 6.15% |
| FirstBank rental home line of credit | (5) | -0- | N/A | -0- | N/A |
| Triad rental home loan | (6) | -0- | N/A | -0- | N/A |
| OceanFirst notes receivable financing | (7) | -0- | N/A | -0- | N/A |
| Total Loans Payable |  | 28585 | 6.44% | 29512 | 6.54% |
| Unamortized debt issuance costs |  | (946) |  | (1233) |  |
| Loans Payable, net of unamortized debt issuance costs |  | $27639 | 6.66% | $28279 | 6.83% |

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&nbsp;&nbsp;&nbsp;&nbsp;(1) Collateralized by the Company's
 securities portfolio and is due on demand. The Company must maintain a coverage ratio of
 approximately 2 times.

&nbsp;&nbsp;&nbsp;&nbsp;(2) Represents an unsecured revolving credit
 facility syndicated with three banks, BMO Capital Markets Corp., JPMorgan Chase Bank, N.A.
 and Wells Fargo, N.A. Total available borrowings under this facility is $260 million. Interest
 is based on the Company's overall leverage ratio and is equal to the Secured Overnight
 Financing Rate ("SOFR") plus 1.5 % to 2.20 %, or BMO's prime lending rate
 plus 0.50 % to 1.20 %, and maturity is November 7, 2026.

&nbsp;&nbsp;&nbsp;&nbsp;(3) Represents revolving credit agreements
 totaling $108.5 million with 21st Mortgage Corporation ("21st Mortgage"), Customers
 Bank, Northpoint Commercial Finance and Triad Financial Services ("Triad") to
 finance inventory purchases. Interest rates on these agreements range from prime minus 0.75 %
 to SOFR plus 4 %. Subsequent to quarter end, the Company paid down this balance.

&nbsp;&nbsp;&nbsp;&nbsp;(4) Represents a term loan secured by rental
 homes and rental home leases, with a fixed interest rate of 6.15 % and a maturity of date
 of May 10, 2028 .

&nbsp;&nbsp;&nbsp;&nbsp;(5) Represents a $25 million revolving line
 of credit secured by rental homes and their leases with a 5 -year term and a variable interest
 rate of prime.

&nbsp;&nbsp;&nbsp;&nbsp;(6) Represents a $30 million revolving line
 of credit secured by rental homes and rental home leases, with an interest rate of prime
 plus 0.25%, with a minimum of 5%.

&nbsp;&nbsp;&nbsp;&nbsp;(7) Represents a $35 million revolving line of credit secured by eligible
 notes receivable, with an interest rate of prime with a floor of 4.75% .
 Subsequent to quarter end, the Company renewed this line of credit. See Note 13.

*<u>Series A Bonds</u>*

On February 6, 2022, the Company issued $102.7 million of its 4.72% Series A Bonds due 2027, or the 2027 Bonds, in an offering to investors in Israel. The Company received $98.7 million, net of offering expenses. The 2027 Bonds are unsecured obligations of the Company denominated in Israeli shekels (NIS) and were issued pursuant to a Deed of Trust dated January 31, 2022 between the Company and Reznik Paz Nevo Trusts Ltd., an Israeli trust company, as trustee. The 2027 Bonds pay interest at a rate of 4.72% per year. Interest on the 2027 Bonds is payable semi-annually on August 31, 2022, and on February 28 and August 31 of the years 2023-2026 (inclusive) and on the final maturity date of February 28, 2027. The principal and interest will be linked to the U.S. Dollar. In the event of a future downgrade by two or more notches in the rating of the 2027 Bonds or a failure by the Company to comply with certain covenants in the Deed of Trust, the interest rate on the 2027 Bonds will be subject to increase. However, any such increases, in the aggregate, would not exceed 1.25% per annum. As of June 30, 2025, the Company is in compliance with these covenants.

Under the Deed of Trust, the Company has the right to redeem the 2027 Bonds, in whole or in part, at any time on or after 60 days from February 9, 2022, the date on which the 2027 Bonds were listed for trading on the Tel Aviv Stock Exchange (the "TASE"). Any such voluntary early redemption by the Company will require payment of the applicable early redemption amount calculated in accordance with the Deed of Trust. The Company does not intend to redeem the 2027 Bonds. Upon the occurrence of an event of default or certain other events, including a delisting of the 2027 Bonds by the TASE, the Company may be required to effect an early repayment or redemption of all or a portion of the 2027 Bonds at their par value plus accrued and unpaid interest. The Deed of Trust permits the Company, subject to certain conditions, to issue additional 2027 Bonds without obtaining approval of the holders of the 2027 Bonds.

The 2027 Bonds are general unsecured obligations of the Company and rank equal in right of payment with all of the Company's existing and future unsecured indebtedness. The Deed of Trust includes certain customary covenants, including financial covenants requiring the Company to maintain certain ratios of debt to net operating income, to shareholders' equity and to earnings, and customary events of default. The 2027 Bonds were offered solely to investors outside the United States and were not offered to, or for the account or benefit of, U.S. Persons (as defined in Regulation S under the Securities Act of 1933).

*<u>Series B Bonds</u>*

Subsequent to quarter end, on July 22, 2025, the Company issued $80.2 million of its new 5.85% Series B Bonds due 2030, or the Series B Bonds, in an offering to investors in Israel. See Note 13 for additional information.

*<u>Mortgages Payable</u>*

The following is a summary of our mortgages payable as of June 30, 2025 and December 31, 2024 *(in thousands)*:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | 6/30/2025 | 6/30/2025 | 12/31/2024 | 12/31/2024 |
|  | Amount | Weighted <br>Average <br>Rate | Amount | Weighted <br>Average <br>Rate |
| Fixed rate mortgages | $535469 | 4.52% | $489271 | 4.18% |
| Unamortized debt issuance costs | (5276) |  | (3731) |  |
| Mortgages Payable, net of unamortized debt issuance costs | $530193 | 4.56% | $485540 | 4.21% |

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On February 28, 2025, the Company paid off one mortgage totaling approximately $6.4 million. On April 1, 2025, the Company paid down nine mortgages totaling approximately $39.3 million. On May 6, 2025, the Company paid off two mortgages totaling approximately $3.8 million.

On May 15, 2025, the Company completed the addition of ten communities to its Fannie Mae credit facility through Wells Fargo Bank, N.A., for total proceeds of approximately $101.4 million. This interest only loan is at a fixed rate of 5.855% with a 10-year term. Including this addition, the total outstanding amount as of June 30, 2025 under the Company's Fannie Mae credit facility was approximately $308.3 million.

As of June 30, 2025 and December 31, 2024, the weighted average loan maturity of mortgages payable was 5.4 years and 4.4 years, respectively.

<u>NOTE 8 – SHAREHOLDERS' EQUITY</u>

*<u>Common Stock</u>*

On April 1, 2025, the Company announced a $0.01 increase, representing a 4.7% increase, in its quarterly common stock dividend, raising it to $0.225 per share from $0.215 per share, representing an annual dividend rate of $0.90 per share. This dividend increase represented our fifth consecutive common stock dividend increase within the last five years, resulting in a 25% cumulative increase over this period.

On June 16, 2025, the Company paid total cash dividends of $18.9 million or $0.225 per share to common shareholders of record as of the close of business on May 15, 2025, of which $850,000 was reinvested in the Dividend Reinvestment and Stock Purchase Plan ("DRIP"). On July 1, 2025, the Company declared a dividend of $0.225 per share to be paid September 15, 2025 to common shareholders of record as of the close of business on August 15, 2025.

During the six months ended June 30, 2025, the Company received, including dividends reinvested of $1.7 million, a total of $4.8 million from its DRIP. There were 288,000 shares issued under the DRIP during this period.

On January 7, 2025, the Board of Directors reaffirmed our Common Stock Repurchase Program (the "Repurchase Program") that authorizes us to repurchase up to $25 million in the aggregate of the Company's common stock. Purchases under the Repurchase Program may be made using a variety of methods, which may include open market purchases, privately negotiated transactions or block trades, or by any combination of such methods, in accordance with applicable insider trading and other securities laws and regulations. The size, scope and timing of any purchases will be based on business, market and other conditions and factors, including price, regulatory and contractual requirements or consents, and capital availability. The Repurchase Program does not require the Company to acquire any particular amount of common stock and may be suspended, modified or discontinued at any time at the Company's discretion without prior notice. For the six months ended June 30, 2025, the Company did not repurchase any shares of its Common Stock.

*<u>Common Stock At-The-Market Sales Programs</u>*

 

On September 16, 2024, the Company terminated the use of its then-existing at-the-market sale program for its Common Stock and entered into a new equity distribution agreement ("September 2024 Common ATM Program") with BMO Capital Markets Corp., J.P. Morgan Securities LLC, Wells Fargo Securities, LLC, B. Riley Securities, Inc., Compass Point Research & Trading, LLC, and Janney Montgomery Scott LLC, as Distribution Agents under which the Company may offer and sell shares of the Company's common stock, $0.10 par value per share, having an aggregate sales price of up to $150 million from time to time through the Distribution Agents, as agents or principals. Sales of the shares of Common Stock under the Distribution Agreement for the September 2024 Common ATM Program will be in "at the market offerings" as defined in Rule 415 under the Securities Act, including, without limitation, sales made directly on or through the NYSE or to or through a market maker or any other method permitted by law, including, without limitation, negotiated transactions and block trades. The Distribution Agents are not required to sell any specific number or dollar amount of securities, but will use commercially reasonable efforts consistent with their normal trading and sales practices, on mutually agreed terms between the Distribution Agents and the Company. For the six months ended June 30, 2025, 2.3 million shares of Common Stock were issued and sold under the September 2024 Common ATM Program at a weighted average price of $17.74 per share, generating gross proceeds of $40.4 million and net proceeds of $39.6 million, after offering expenses.

As of June 30, 2025, $49.4 million of common stock remained eligible for sale under the September 2024 Common ATM Program.

*<u>6.375% Series D Cumulative Redeemable Preferred Stock</u>*

On June 16, 2025, the Company paid $5.1 million in dividends or $0.3984375 per share for the period from March 1, 2025 through May 31, 2025 to holders of record as of the close of business on May 15, 2025 of our 6.375% Series D Cumulative Redeemable Preferred Stock, $0.10 par value per share, Liquidation Preference $25.00 per share ("Series D Preferred Stock"). Dividends on our Series D Preferred Stock are cumulative and payable quarterly at an annual rate of $1.59375 per share.

On July 1, 2025, the Company declared a dividend of $0.3984375 per share for the period from June 1, 2025 through August 31, 2025 to be paid on September 15, 2025 to Series D Preferred shareholders of record as of the close of business on August 15, 2025.

*<u>Preferred Stock At-The-Market Sales Program</u>*

On January 10, 2023, the Company entered into an At Market Issuance Sales Agreement ("2023 Preferred ATM Program") with B. Riley Securities, Inc. ("B. Riley"), as distribution agent. Under the 2023 Preferred ATM Program, the Company was permitted to offer and sell shares of the Company's 6.375% Series D Cumulative Redeemable Preferred Stock, $0.10 par value per share, with a liquidation preference of $25.00 per share (the "Series D Preferred Stock"), having an aggregate sales price of up to $100 million from time to time through B. Riley, as agent or principal. Sales of the shares of Series D Preferred Stock in the 2023 Preferred ATM Program were made in "at the market offerings" as defined in Rule 415 under the Securities Act of 1933, as amended (the "Securities Act"), including, without limitation, sales made directly on or through the New York Stock Exchange (the "NYSE") or on any other existing trading market for the Series D Preferred Stock, as applicable, or to or through a market maker or any other method permitted by law, including, without limitation, negotiated transactions and block trades. B. Riley was not required to sell any specific number or dollar amount of securities, but agreed to use its commercially reasonable efforts consistent with its normal trading and sales practices, on mutually agreed terms between B. Riley and the Company. For the six months ended June 30, 2025, the Company issued and sold 49,000 shares of its Series D Preferred Stock under the 2023 Preferred ATM Program at a weighted average price of $23.03 per share, generating gross proceeds of $1.1 million and net proceeds of $982,000, after offering expenses.

On March 5, 2025, the Company terminated the use of the 2023 Preferred ATM Program and entered into an at market issuance sales agreement (the "2025 Preferred ATM Program") with B. Riley, as distribution agent, under which the Company may offer and sell shares of the Company's Series D Preferred Stock having an aggregate sales price of up to $100 million from time to time through B. Riley, as agent or principal. Sales of the shares of Series D Preferred Stock under the 2025 Preferred ATM Program, if any, will be in "at the market offerings" as defined in Rule 415 under the Securities Act of 1933, as amended (the "Securities Act"), including, without limitation, sales made directly on or through the New York Stock Exchange (the "NYSE") or on any other existing trading market for the Series D Preferred Stock, as applicable, or to or through a market maker or any other method permitted by law, including, without limitation, negotiated transactions and block trades. B. Riley is not required to sell any specific number or dollar amount of securities, but will use commercially reasonable efforts consistent with its normal trading and sales practices, on mutually agreed terms between B. Riley and the Company. At the time of termination of the 2023 Preferred ATM Program, approximately $16.5 million of Series D Preferred Stock remained unsold under the 2023 Preferred ATM Program.

As of June 30, 2025, the Company has not issued or sold any shares under the 2025 Preferred ATM Program.

In conjunction with the 2025 Preferred ATM Program, on March 5, 2025, the Company filed with the State Department of Assessments and Taxation of the State of Maryland (the "SDAT") an amendment (the "Articles of Amendment") to the Articles of Incorporation of the Company to increase the Company's authorized shares of common stock, par value $0.10 per share ("Common Stock"), by 25,000,000 shares. Also on March 5, 2025, the Company filed with the SDAT Articles Supplementary (the "Articles Supplementary") reclassifying and designating 5,000,000 shares of the Company's Common Stock as shares of Series D Preferred Stock. After giving effect to the Articles of Amendment and the Articles Supplementary, the authorized capital stock of the Company consists of 205,413,800 shares, classified as 183,713,800 shares of Common Stock, 18,700,000 shares of Series D Preferred Stock, and 3,000,000 shares of Excess Stock.

<u>NOTE 9 – STOCK BASED COMPENSATION</u>

The Company accounts for awards of stock, stock options and restricted stock in accordance with ASC 718-10, "Compensation-Stock Compensation." ASC 718-10 requires that compensation cost for all stock awards be calculated and amortized over the service period (generally equal to the vesting period). The compensation cost for stock option grants is determined using option pricing models, intended to estimate the fair value of the awards at the grant date less estimated forfeitures. The compensation expense for restricted stock is recognized based on the fair value of the restricted stock awards less estimated forfeitures. The fair value of restricted stock awards is equal to the fair value of the Company's stock on the grant date. Compensation costs of $3.4 and $6.5 million, of which $1.5 and $2.9 million were capitalized, have been recognized for the three and six months ended June 30, 2025, respectively. Compensation costs of $1.9 and $3.7 million, of which $694,000 and $1.2 million were capitalized, have been recognized for the three and six months ended June 30, 2024, respectively.

On January 7, 2025, the Company awarded a total of 26,000 shares of restricted stock to six employees under the Company's 2023 Equity Incentive Award Plan (the "2023 Plan"). The grant date fair value of these restricted stock grants was $473,000. These grants vest ratably over 5 years.

On January 7, 2025, the Company awarded a total of 7,479 shares of common stock to nine members of our Board of Directors in payment of directors fees. The grant date fair value of these awards was $136,000.

On January 7, 2025, the Company also awarded a total of 179,944 shares of restricted stock to four employees, pursuant to their employment agreements. These grants are subject to a combination of both performance-based and time-based metrics. The grant date fair value of these restricted stock grants was $3.3 million. Of these shares, 59,981 shares (time-based) vest over 1 year. The remaining shares (performance-based) vest after 1 year only upon achievement of certain corporate and financial metrics.

On March 6, 2025, the Company granted options to purchase 541,500 shares of common stock to fifty-five employees under the Company's 2023 Plan. The grant date fair value of these options amounted to approximately $1.9 million. These grants vest ratably over five years.

On March 25, 2025, the Company awarded a total of 11,007 shares of common stock to nine members of our Board of Directors in payment of directors fees. The grant date fair value of these awards was $201,000.

On June 16, 2025, the Company granted options to purchase 325,000 shares of common stock to six employees under the Company's 2023 Plan. The grant date fair value of these options amounted to approximately $1.1 million. These grants vest ratably over five years. Compensation costs for grants issued to a participant who is of retirement age are recognized at the time of the grant.

On June 16, 2025, the Company granted options to purchase 96,000 shares of common stock to eight members of our Board of Directors under the 2023 Plan. The grant date fair value of these options amounted to approximately $324,000. These grants vest ratably over five years.

On June 16, 2025, the Company awarded a total of 8,896 shares of common stock to eight members of our Board of Directors in payment of directors fees. The grant date fair value of these awards was $150,000.

The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions used for grants during the six months ended June 30, 2025:

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| | |
|:---|:---|
|  | 2025 |
| Dividend yield | 4.90% |
| Expected volatility | 27.41% |
| Risk-free interest rate | 4.36% |
| Expected lives | 10 |
| Estimated forfeitures | -0- |

---

During the six months ended June 30, 2025, nine participants in the Company's equity incentive plans exercised options to purchase a total of 35,260 shares of common stock at a weighted-average exercise price of $13.93 per share for total proceeds of $491,300. The aggregate intrinsic value of options exercised was $151,000. During the six months ended June 30, 2025, options to purchase 10,000 shares were forfeited.

As of June 30, 2025, there were options outstanding under the Company's equity incentive plans to purchase 6.3 million shares, with an aggregate intrinsic value of $11.4 million. On May 28, 2025, the Company's shareholders approved an amendment to the 2023 Plan which increased the shares of common stock available for future awards under the 2023 Plan by 2,250,000 shares. As of June 30, 2025, there were 1.8 million shares available for grant under the 2023 Plan.

<u>NOTE 10 – FAIR VALUE MEASUREMENTS</u>

In accordance with ASC 820-10, "Fair Value Measurements and Disclosures," the Company measures certain financial assets and liabilities at fair value on a recurring basis, including marketable securities. The fair value of these financial assets and liabilities was determined using the following inputs at June 30, 2025 and December 31, 2024 *(in thousands)*:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | Fair Value Measurements at Reporting Date Using | Fair Value Measurements at Reporting Date Using | Fair Value Measurements at Reporting Date Using | Fair Value Measurements at Reporting Date Using |
|  |<br><br>Total | Quoted Prices<br>In Active<br>Markets for<br>Identical Assets<br>(Level 1) | Significant<br>Other<br>Observable<br>Inputs<br>(Level 2) |<br>Significant<br>Unobservable<br>Inputs<br>(Level 3) |
| <u>As of June 30, 2025:</u> |  |  |  |  |
| Marketable Securities - Preferred stock | $541 | $541 | $-0- | $-0- |
| Marketable Securities - Common stock | 29618 | 29618 | -0- | -0- |
| Total | $30159 | $30159 | $-0- | $-0- |
| <u>As of December 31, 2024:</u> |  |  |  |  |
| Marketable Securities - Preferred stock | $509 | $509 | $-0- | $-0- |
| Marketable Securities - Common stock | 31374 | 31374 | -0- | -0- |
| Total | $31883 | $31883 | $-0- | $-0- |

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In addition to the Company's investment in marketable securities at fair value, the Company is required to disclose certain information about fair values of its other financial instruments, as defined in ASC 825-10, Financial Instruments. Estimates of fair value are made at a specific point in time, based upon, where available, relevant market prices and information about the financial instrument. Such estimates do not include any premium or discount that could result from offering for sale at one time the Company's entire holdings of a particular financial instrument. All of the Company's marketable securities have quoted market prices. However, for a portion of the Company's other financial instruments, no quoted market value exists. Therefore, estimates of fair value are necessarily based on a number of significant assumptions (many of which involve events outside the control of management). Such assumptions include assessments of current economic conditions, perceived risks associated with these financial instruments and their counterparties, future expected loss experience and other factors. Given the uncertainties surrounding these assumptions, the reported fair values represent estimates only and, therefore, cannot be compared to the historical accounting model. Use of different assumptions or methodologies is likely to result in significantly different fair value estimates.

The fair value of cash and cash equivalents and notes receivable approximates their current carrying amounts since all such items are short-term in nature. The fair value of variable rate loans payable approximate their current carrying amounts since such amounts payable are at approximately a weighted-average current market rate of interest. As of June 30, 2025, the estimated fair value of fixed rate mortgages payable amounted to $530.3 million and the carrying value of fixed rate mortgages payable amounted to $535.5 million.

<u>NOTE 11 – CONTINGENCIES, COMMITMENTS AND OTHER MATTERS</u>

The Company is subject to claims and litigation in the ordinary course of business. Management does not believe that any such claim or litigation will have a material adverse effect on the business, assets, or results of operations of the Company.

The Company had an agreement with 21st Mortgage under which 21st Mortgage provided financing for home purchasers in the Company's communities. The Company did not receive referral fees or other cash compensation under the agreement. If 21st Mortgage made loans to purchasers and those purchasers defaulted on their loans and 21st Mortgage repossessed the homes securing such loans, the Company agreed to purchase from 21st Mortgage each such repossessed home for a price equal to 80% to 95% of the amount under each such loan, subject to certain adjustments. As of June 30, 2025, the total loan balance under this agreement was approximately $2.1 million. Additionally, 21st Mortgage previously made loans to purchasers in certain communities we acquired. In conjunction with these acquisitions, the Company has agreed to purchase from 21st Mortgage each repossessed home, if those purchasers default on their loans. The purchase price ranges from 55% to 100% of the amount under each such loan, subject to certain adjustments. As of June 30, 2025, the total loan balance owed to 21st Mortgage with respect to homes in these acquired communities was approximately $479,000. This program was terminated on June 22, 2023. The Company's repurchase obligations for the outstanding loans that were originated by 21st Mortgage remain in effect.

The Company entered into a Manufactured Home Retailer Agreement (the "MHRA") with 21st Mortgage on January 24, 2023, under which 21st Mortgage provides financing for home purchasers in the Company's communities. 21st Mortgage has no recourse against the Company under the MHRA except in instances where the Customer defaults before two scheduled monthly payments are paid by the purchaser and the default is based on any dispute between S&F and the purchaser surrounding the terms or execution of the purchase and sale of the home. Upon such a default, S&F is to take assignment of the loan from 21st Mortgage for the unpaid principal balance plus accrued interest. As of June 30, 2025, no loans have been originated under the MHRA.

S&F entered into a Chattel Loan Origination, Sale and Servicing Agreement ("COP Program") with Triad Financial Services, effective January 1, 2016. Neither the Company, nor S&F, receive referral fees or other cash compensation under the agreement. If the loan is approved under the COP Program, then it is originated by Triad, assigned to S&F and then assigned by S&F to the Company. Included in Notes and Other Receivables is approximately $91.7 million of loans that the Company acquired under the COP Program as of June 30, 2025.

The Company and one of its subsidiaries are parties to a Limited Liability Company Agreement dated as of December 8, 2021 with an affiliate of Nuveen, which governs the initial joint venture entity between the Company and Nuveen. The LLC Agreement provided for the parties to initially fund up to $70 million of equity capital for acquisitions during a 24-month commitment period, with Nuveen having the option, subject to certain conditions, to elect to increase the parties' total commitments by up to an additional $100 million and to extend the commitment period for up to an additional four years. The Company is required to fund 40% of the committed capital and Nuveen is required to fund 60%. All such funding will be on a parity basis. Since the execution of the LLC Agreement, this joint venture entity has acquired two properties. The Company and Nuveen have continued to seek, and are continuing to seek, opportunities to acquire additional manufactured housing and/or recreational vehicle communities that are under development and/or newly developed and meet certain other investment guidelines. The Company and Nuveen have informally agreed that any future acquisitions would be made by one or more new joint venture entities to be formed for that purpose and that the existing joint venture entity formed in December 2021 will not consummate additional acquisitions but will maintain its existing property portfolio. The Company and Nuveen also informally agreed that, unless otherwise determined in connection with any specific future investment, capital for any such new joint venture entity would continue to be funded 60% by Nuveen and 40% by the Company on a parity basis and that other terms would be similar to those of the LLC Agreement entered into in 2021, except that the amounts of the parties' respective capital commitments will be determined on a property-by-property basis. In 2023, the Company and Nuveen formed a new joint venture entity, governed by a new joint venture agreement, focused on the development of a new manufactured housing community located in Honey Brook, Pennsylvania. The community contains 113 manufactured home sites situated on approximately 61 acres. This community, named Honey Ridge, opened for occupancy in June 2025 with 16 homes on-site of which five have been sold or have pending offers to be sold. As with the 2021 LLC Agreement, capital contributions to the joint venture entity formed for this project are funded 60% by Nuveen and 40% by the Company on a parity basis and the other terms (including restrictions on the Company's right to acquire manufacturing housing communities that meet the LLC Agreement's investment guidelines without first offering Nuveen an opportunity to participate in the acquisition) are similar to those set forth in the LLC Agreement entered into in 2021 (See Note 5).

Earlier this year, the Company entered into a preliminary agreement with a leading national homebuilder regarding the potential formation of a joint venture to develop approximately 131 acres of undeveloped land adjacent to one of the Company's existing manufactured home communities in southern New Jersey. If necessary governmental approvals can be obtained, the purpose of the joint venture would be to construct roads, infrastructure and other site improvements on the property and then sell the improved lots to an affiliate of the Company's joint venture partner, which would construct luxury single family residential homes to sell to purchasers. It is envisioned that the joint venture partner would fully fund the costs of required site improvements, to the extent not financed by a third-party construction lender, and would obtain all required approvals. The Company would contribute the real property to the joint venture and receive a percentage of the sale price of each home. If the parties elect to proceed, it is anticipated that the joint venture partner would seek preliminary subdivision and site plan approvals over the next two years and, if these approvals are obtained, the joint venture would then be formally established. Pursuit of this project would be contingent upon execution of definitive documentation setting forth the terms of certain agreements between the parties. There can be no assurance that the Company and its potential joint venture partner will reach agreement or proceed with this arrangement or that required governmental approvals can be obtained. The parties are currently engaged in a due diligence period during which the Company's joint venture partner is evaluating the feasibility of the project. The parties intend to commence preliminary discussions with the municipality relating to the necessary approvals. The due diligence period has been extended twice and currently expires on September 9, 2025.

<u>NOTE 12 – SUPPLEMENTAL CASH FLOW INFORMATION</u>

Cash paid for interest during the six months ended June 30, 2025 and 2024 was $14.1 million and $15.8 million, respectively. Interest cost capitalized to land development was $2.5 million and $2.4 million for the six months ended June 30, 2025 and 2024, respectively.

During the six months ended June 30, 2025 and 2024, stock compensation of $2.9 million and $1.2 million, respectively, was capitalized to land development.

During the six months ended June 30, 2025 and 2024, the Company had Dividend Reinvestments of $1.7 million and $1.5 million, respectively, which required no cash transfers.

<u>NOTE 13 – SUBSEQUENT EVENTS</u>

Management has evaluated subsequent events for disclosure and/or recognition in the financial statements through the date that the financial statements were issued.

Since July 1, 2025, the Company issued and sold an additional 160,000 shares of its Common Stock under the September 2024 Common ATM Program at a weighted average price of $16.99 per share, generating net proceeds, after offering expenses, of $2.7 million. As of August 1, 2025, $46.7 million of Common Stock remained eligible for sale under the September 2024 Common ATM Program.

On July 2, 2025, the Company acquired two communities, Conowingo Court and Maybelle Manor, located in Conowingo, Maryland, for approximately $14.6 million. These communities contain a total of 191 newly developed homesites, which are 79% occupied. They are situated on approximately 82 total acres.

On July 8, 2025, the Company amended its $35 million revolving line of credit with OceanFirst Bank to extend the maturity date to June 1, 2027. Interest is at prime with a floor of 4.75%. This line is secured by the Company's eligible notes receivable.

On July 22, 2025, the Company issued approximately $80.2 million aggregate principal amount of its 5.85% Series B Bonds Due 2030 (the "Series B Bonds") in an offering to investors in Israel. The Series B Bonds were issued pursuant to a Deed of Trust between the Company and Reznik Paz Nevo Trusts Ltd., an Israeli trust company, as trustee (the "Trustee"), dated as of July 18, 2025 (the "Deed of Trust"). The Series B Bonds are unsecured obligations of the Company denominated in Israeli shekels ("NIS") and rank pari passu with all other unsecured obligations of the Company. The net proceeds of the sale of the Series B Bonds, after deducting offering discounts, fees and other transaction costs, are estimated to be approximately $75.2 million, which the Company intends to use for working capital and general corporate purposes.

Principal of the Series B Bonds will be payable on June 30, 2030. The Company will pay interest on the Series B Bonds at a rate of 5.85% per annum, payable semi-annually on June 30 and December 31 of each year, beginning December 31, 2025 and continuing through the maturity date. Payments of principal and interest will be made in NIS and will be adjusted for changes in the exchange rate of the U.S. Dollar to the NIS as of each payment date. In the event of any future downgrade by two or more notches in the rating of the Series B Bonds (or if the Series B Bonds cease to be rated due to a failure by the Company to comply with certain reporting and other obligations under the Deed of Trust), the interest rate on the Series B Bonds will be subject to increase by up to 1.25% per annum. In addition, the interest rate on the Series B Bonds will be subject to increase by up to 0.5% per annum upon any failure by the Company to comply with certain financial covenants in the Deed of Trust. The maximum aggregate additional interest payable on the Series B Bonds as a result of any such downgrades (or cessation of rating) and/or any such failures to comply with financial covenants would not exceed a rate of 1.5% per annum. Following any such increase in the interest rate, in the event of a subsequent upgrade or reinstatement of rating and/or compliance with such financial covenants, the interest rate will be reduced.

The Deed of Trust includes certain customary covenants, including financial covenants requiring the Company to maintain specified ratios of debt to net operating income, to shareholders equity and to earnings, and customary events of default. In addition, if the Company is not in compliance with one or more of the financial covenants, it will be restricted from making dividend payments other than those necessary to comply with the requirements to maintain its status as a REIT for income tax purposes. The covenants and events of default are substantially similar to those in the Deed of Trust for the Company's 4.72% Series A Bonds Due 2027, which were issued in February 2022, except that the threshold amount for an event of default involving the appointment of a receiver over the Company or its assets has been lowered from 50% to 35% of total assets of the Company.

Under the Deed of Trust, the Company has the right to redeem the Series B Bonds, in whole or in part, at any time on or after 60 days from July 22, 2025, the date on which the Series B Bonds were listed for trading on the Tel Aviv Stock Exchange.

The Series B Bonds and the Deed of Trust are in the Hebrew language and are governed by the laws of the State of Israel.

The Series B Bonds have not been and will not be registered under the Securities Act of 1933, as amended (the "Securities Act"), and may not be offered or sold in the United States absent registration under the Securities Act or an applicable exemption from such registration requirements. The Series B Bonds were offered solely to investors outside the United States and were not offered to, or for the account or benefit of, U.S. Persons (as defined in Regulation S under the Securities Act).

<u>NOTE 14 – PROFORMA FINANCIAL INFORMATION (UNAUDITED)</u>

The following unaudited pro forma condensed financial information reflects acquisitions through July 2025 (including the two communities in Maryland acquired on July 2, 2025). This information has been prepared utilizing the historical financial statements of the Company and the effect of additional revenue and expenses from the properties acquired during this period assuming that the acquisitions had occurred as of the first day of the applicable period, after giving effect to certain adjustments including: (a) rental and related income; (b) community operating expenses; (c) interest expense resulting from the assumed increase in mortgages and loans payable related to the new acquisitions; and (d) depreciation expense related to the new acquisitions. The unaudited pro forma condensed financial information is not indicative of the results of operations that would have been achieved had the acquisitions reflected herein been consummated on the dates indicated or that will be achieved in the future *(in thousands)*.

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| | | | | |
|:---|:---|:---|:---|:---|
|  | Three Months Ended | Three Months Ended | Six Months Ended | Six Months Ended |
|  | 6/30/25 | 6/30/24 | 6/30/25 | 6/30/24 |
| Rental and Related Income | $56449 | $52264 | $111711 | $103361 |
| Community Operating Expenses | 23249 | 21809 | 46476 | 43120 |
| Net Income (Loss) Attributable to Common Shareholders | 2242 | 90 | 1573 | (6609) |
| Net Income (Loss) Attributable to Common Shareholders Per Share – Basic and Diluted | $0.03 | $0.00 | $0.02 | $(0.09) |

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**Item 2.** **Management's Discussion and Analysis of Financial Condition and Results of Operations**

**<u>Overview</u>**

The following discussion and analysis of the consolidated financial condition and results of operations should be read in conjunction with the consolidated financial statements and footnotes thereto included elsewhere herein and in the Company's annual report on Form 10-K for the year ended December 31, 2024.

The Company is a Maryland corporation that operates as a self-administered, self-managed REIT with headquarters in Freehold, New Jersey. The Company's primary business is the ownership and operation of manufactured home communities, which includes leasing manufactured home spaces on an annual or month-to-month basis to residents. The Company also leases manufactured homes to residents and, through its wholly-owned taxable REIT subsidiary, S&F, sells and finances the sale of manufactured homes to residents and prospective residents of our communities and for placement on customers' privately-owned land. During 2022, the Company also formed a qualified opportunity zone fund to acquire, develop and redevelop manufactured housing communities requiring substantial capital investment and located in areas designated as qualified opportunity zones by the Treasury Department pursuant to a program authorized under the 2017 Tax Cuts and Jobs Act to encourage long-term investment in economically distressed areas. The Company currently holds a 77% interest in the qualified opportunity zone fund. The Company also has an ownership interest in and operates two communities in Florida, and one community in Pennsylvania which opened for occupancy in June 2025, through its joint venture relationship with Nuveen Real Estate. The Company has a 40% interest in the Nuveen joint venture entities. The Pennsylvania community, named Honey Ridge, is located in Honey Brook, Pennsylvania and contains 113 manufactured home sites situated on approximately 61 acres.

As of June 30, 2025, the Company operated 142 manufactured home communities, 139 of which are communities in which we own either a 100% or majority interest, containing a total of approximately 26,600 developed homesites, on which approximately 10,600 Company-owned rental homes are situated. These 142 communities are located in New Jersey, New York, Ohio, Pennsylvania, Tennessee, Indiana, Maryland, Michigan, Alabama, South Carolina, Florida and Georgia. Subsequent to quarter end, the Company acquired two manufactured home communities containing 191 developed homesites, located in Conowingo, Maryland, for a total purchase price of $14.6 million (See Note 13). Including these communities, the Company currently operates 144 communities, containing 26,800 developed homesites.

Earlier this year, the Company entered into a preliminary agreement with a leading national homebuilder regarding the potential formation of a joint venture to develop approximately 131 acres of undeveloped land adjacent to one of the Company's existing manufactured home communities in southern New Jersey (See Note 11 of the Notes to Consolidated Financial Statements).

The Company earns income from the operation of its manufactured home communities, leasing of manufactured homesites, the rental of manufactured homes, the sale and finance of manufactured homes and the brokering of home sales, self-storage leases, oil and gas leases, cable service agreements and from appreciation in the values of the manufactured home communities and vacant land owned by the Company. In addition, the Company receives property management and other fees from its joint venture arrangements with Nuveen and from its opportunity zone fund.

The primary focus of our business is the operation of our manufactured home communities – leasing of manufactured homesites and manufactured homes in our communities. The sale of homes is integrated with our leasing of these manufactured homes and homesites. Management views the Company's business as a single segment based on its method of internal reporting in addition to its allocation of capital and resources. Capital and resources are allocated to further the goal of maintaining and increasing occupancy and net operating income in our communities. Our chief executive officer, with the assistance of our chief operating officer, is the principal decision-maker regarding allocation of resources. These decisions are based on the occupancy of the communities and community net operating income. Sales of homes are necessary to maintain and increase occupancy at our communities. We primarily purchase homes to fill vacant sites in the communities. These homes are either rented or sold, based on the needs of the potential residents. Although certain components of the sales operation are tracked (sales, cost of sales, etc.), separate discrete financial information for the entire sales operation is not available. Most of the personnel costs, office expenses, maintenance and other expenses are borne by the community and cannot be allocated. The components of the sales operation play no material role in decisions about resources to be allocated. Resources are allocated to maintaining and increasing occupancy and net operating income in our communities.

The Company believes that its capital structure, which allows for the ownership of assets using a balanced combination of equity obtained through the issuance of common stock, preferred stock and debt, will enhance shareholder returns as the properties appreciate over time.

The Company intends to continue to increase its real estate investments and investments in expansions. Our business plan includes acquiring communities that over time are expected to yield in excess of our cost of funds and then investing in physical improvements, including adding rental homes onto otherwise vacant sites. This has resulted in increased occupancy rates and improved operating results. For the three and six months ended June 30, 2025, rental and related income increased 9% from the prior year periods and Community Net Operating Income ("NOI"), as defined below, increased 11% and 9%, respectively. Same property NOI, which includes communities owned and operated as of January 1, 2024 (excluding Memphis Blues, Duck River Estates and River Bluff Estates), increased 10% and 9% for the three and six months ended June 30, 2025, respectively, over the prior year period driven by an 80 basis point increase in occupancy, to 88.2%, and rental rate increase of 4.2%. We have been positioning ourselves for future growth and will continue to seek opportunistic investments. In addition, on behalf of our joint venture arrangement with Nuveen Real Estate, we will seek opportunities to acquire manufactured home communities that are under development and/or newly developed and meet certain other investment guidelines. We will also seek additional opportunities, through our opportunity zone fund, to acquire communities that require substantial capital investment and are located in qualified opportunity zones.

For the three and six months ended June 30, 2025, sales of manufactured homes increased 19% and 6%, respectively from the prior year periods. Demand for quality affordable housing remains healthy while inventory is scarce. Our property type offers substantial comparative value that should result in increased demand.

The macro-economic environment and current housing fundamentals continue to favor home rentals. Due to high mortgage rates and lack of inventory, the higher cost of buying a home versus renting one is at its most extreme since 1996. According to the National Association of Realtors, reported sales of existing homes fell to 4.06 million in 2024, the lowest level in nearly 30 years. We believe rental homes in a manufactured home community allow the resident to obtain the efficiencies of factory-built housing and the amenities of community living for less than the cost of other forms of affordable housing. We continue to see strong demand for rental homes. We have added an additional 237 rental homes during the first six months of 2025, net of rental home sales. This brought the total number of rental homes to approximately 10,600 rental homes, or 40.4% of total sites. Occupied rental homes represented approximately 43.2% of total occupied sites at quarter end. Occupancy in rental homes continues to be strong and was at 94.4% as of June 30, 2025. Our manufactured home communities compare favorably with other types of rental housing, including apartments, and we will continue to allocate capital to rental home purchases, as demand dictates.

**<u>Acquisitions</u>**

The following is a summary of the communities acquired during the six months ended June 30, 2025 and during July 2025:

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Community** | **Date of <br> Acquisition** | **Number of** <br> **Sites** | **Purchase Price *(in thousands)*** | **Number of**<br> **Acres** | **Occupancy at Acquisition** |
| Cedar Grove | March 24, 2025 NJ | 186 | $17000 | 25 | 100% |
| Maplewood Village | March 24, 2025 NJ | 80 | 7600 | 13 | 100% |
| **Total as of June 30, 2025** |  | **266** | **24600** | **38** | **100%** |
| Conowingo Court *<sup>(1)</sup>* | July 2, 2025 MD | 142 | 9855 | 55 | 70% |
| Maybelle Manor *<sup>(1)</sup>* | July 2, 2025 MD | 49 | 4770 | 28 | 100% |
| **Total 2025 to Date** |  | **457** | $**39225** | **121** | **91%** |

---

*(1) See Note 13 to the Consolidated Financial Statements.*

See PART I, Item 1 – Business in the Company's Annual Report on Form 10-K for the year ended December 31, 2024 for a more complete discussion of the economic and industry-wide factors relevant to the Company and the opportunities and challenges, and risks on which the Company is focused.

**<u>Significant Accounting Policies and Estimates</u>**

The discussion and analysis of the Company's financial condition and results of operations are based upon the Company's consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"). The preparation of these consolidated financial statements requires management to make estimates and judgments that affect the reported amounts of assets and liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities at the date of the Company's consolidated financial statements. Actual results may differ from these estimates under different assumptions or conditions.

On a regular basis, management evaluates our assumptions, judgments and estimates. Management believes there have been no material changes to the items that we disclosed as our significant accounting policies and estimates under Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations," in our Annual Report on Form 10-K for the year ended December 31, 2024.

**<u>Supplemental Measures</u>**

In addition to the results reported in accordance with U.S. GAAP, management's discussion and analysis of financial condition and results of operations include certain non-U.S. GAAP financial measures that in management's view of the business we believe are meaningful as they allow the investor the ability to understand key operating details of our business both with and without regard to certain accounting conventions or items that may not always be indicative of recurring annual cash flows of the portfolio. These non-U.S. GAAP financial measures as determined and presented by us may not be comparable to related or similarly titled measures reported by other companies, and include Community Net Operating Income ("Community NOI"), Funds from Operations Attributable to Common Shareholders ("FFO") and Normalized Funds from Operations Attributable to Common Shareholders ("Normalized FFO").

We define Community NOI as rental and related income less community operating expenses such as real estate taxes, repairs and maintenance, community salaries, utilities, insurance and other expenses. We believe that Community NOI is helpful to investors and analysts as a direct measure of the actual operating results of our manufactured home communities, rather than our Company overall. Community NOI should not be considered a substitute for the reported results prepared in accordance with U.S. GAAP. Community NOI should not be considered as an alternative to net income (loss) as an indicator of our financial performance, or to cash flows as a measure of liquidity; nor is it indicative of funds available for our cash needs, including our ability to make cash distributions.

The Company's Community NOI for the three and six months ended June 30, 2025 and 2024 is calculated as follows *(in thousands)*:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Three Months Ended | Three Months Ended | Six Months Ended | Six Months Ended |
|  | 6/30/25 | 6/30/24 | 6/30/25 | 6/30/24 |
| Rental and Related Income | $56165 | $51494 | $110739 | $101823 |
| Less: Community Operating Expenses | 23047 | 21595 | 46076 | 42692 |
| Community NOI | $33118 | $29899 | $64663 | $59131 |

---

We assess and measure our overall operating results based upon FFO, an industry performance measure which management believes is a useful indicator of our operating performance. FFO is used by industry analysts and investors as a supplemental operating performance measure of a REIT. FFO, as defined by Nareit, represents net income (loss) attributable to common shareholders, as defined by accounting principles generally accepted in the U.S. ("U.S. GAAP"), excluding certain gains or losses from sales of previously depreciated real estate assets, impairment charges related to depreciable real estate assets, the change in the fair value of marketable securities, and the gain or loss on the sale of marketable securities plus certain non-cash items such as real estate asset depreciation and amortization. Included in the Nareit FFO White Paper - 2018 Restatement, is an option pertaining to assets incidental to our main business in the calculation of Nareit FFO to make an election to include or exclude gains and losses on the sale of these assets, such as marketable equity securities, and include or exclude mark-to-market changes in the value recognized on these marketable equity securities. In conjunction with the adoption of the FFO White Paper - 2018 Restatement, for all periods presented, we have elected to exclude the change in the fair value of marketable securities from our FFO calculation. Nareit created FFO as a non-U.S. GAAP supplemental measure of REIT operating performance. We define Normalized Funds from Operations Attributable to Common Shareholders ("Normalized FFO"), as FFO, excluding certain one-time charges. FFO and Normalized FFO should be considered as supplemental measures of operating performance used by REITs. FFO and Normalized FFO exclude historical cost depreciation as an expense and may facilitate the comparison of REITs which have a different cost basis. However, other REITs may use different methodologies to calculate FFO and Normalized FFO and, accordingly, our FFO and Normalized FFO may not be comparable to all other REITs. The items excluded from FFO and Normalized FFO are significant components in understanding the Company's financial performance.

FFO and Normalized FFO (i) do not represent cash flow from operations as defined by U.S. GAAP; (ii) should not be considered as an alternative to net income (loss) as a measure of operating performance or to cash flows from operating, investing and financing activities; and (iii) are not alternatives to cash flow as a measure of liquidity.

The Company's FFO and Normalized FFO attributable to common shareholders for the three and six months ended June 30, 2025 and 2024 are calculated as follows *(in thousands)*:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Three Months Ended | Three Months Ended | Six Months Ended | Six Months Ended |
|  | 6/30/25 | 6/30/24 | 6/30/25 | 6/30/24 |
| Net Income (Loss) Attributable to Common Shareholders | $2532 | $527 | $2261 | $(5737) |
| Depreciation Expense | 15739 | 15001 | 32402 | 29742 |
| Depreciation Expense from Unconsolidated Joint Ventures | 221 | 204 | 438 | 401 |
| Loss on Sales of Investment Property and Equipment | 36 | 10 | 37 | 13 |
| (Increase) Decrease in Fair Value |  |  |  |  |
| of Marketable Securities | 175 | (3338) | 1737 | 2031 |
| Loss on Sales of Marketable Securities, net | -0- | 3778 | -0- | 3778 |
| FFO Attributable to Common Shareholders | 18703 | 16182 | 36875 | 30228 |
| Adjustments: |  |  |  |  |
| Amortization of Financing Costs | 647 | 607 | 1246 | 1163 |
| Non- Recurring Other Expense <sup>(1)</sup> | 102 | 18 | 151 | 433 |
| Normalized FFO Attributable to Common Shareholders | $19452 | $16807 | $38272 | $31824 |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Consists of one-time legal and professional
 fees ($102 and $151, respectively) for the three and six months ended June 30, 2025. Consist ed of one-time legal fees ($18 and $51, respectively) and costs associated with
 the liquidation/sale of inventory in a particular sales center ($0 and $382, respectively)
 for the three and six months ended June 30, 2024.

The following are the cash flows provided by (used in) operating, investing and financing activities for the six months ended June 30, 2025 and 2024 *(in thousands)*:

---

| | | |
|:---|:---|:---|
|  | Six Months Ended | Six Months Ended |
|  | 6/30/25 | 6/30/24 |
| Operating Activities | $37195 | $37605 |
| Investing Activities | (100648) | (58758) |
| Financing Activities | 42125 | 7598 |

---

**<u>Changes In Results Of Operations</u>**

Rental and related income increased 9% from $51.5 million for the three months ended June 30, 2024 to $56.2 million for the three months ended June 30, 2025. Rental and related income increased 9% from $101.8 million for the six months ended June 30, 2024 to $110.7 million for the six months ended June 30, 2025. This increase was due to acquisitions, increases in rental rates and same property occupancy and additional rental homes. The Company has been raising rental rates by approximately 5% to 6% annually at most communities. Same property occupancy has increased 80 basis points from 87.4% as of June 30, 2024 to 88.2% at June 30, 2025. Occupied rental homes increased 4% from approximately 9,600 homes at June 30, 2024 to 10,000 homes at June 30, 2025.

Community operating expenses increased 7% from $21.6 million for the three months ended June 30, 2024 to $23.0 million for the three months ended June 30, 2025. Community operating expenses increased 8% from $42.7 million for the six months ended June 30, 2024 to $46.1 million for the six months ended June 30, 2025. These increases were due to acquisitions and an increase in payroll costs, real estate taxes, snow removal and water and sewer costs.

Community NOI increased 11% from $29.9 million for the three months ended June 30, 2024 to $33.1 million for the three months ended June 30, 2025. Community NOI increased 9% from $59.1 million for the six months ended June 30, 2024 to $64.7 million for the six months ended June 30, 2025. These increases were primarily due to acquisitions, increases in rental rates, occupancy and rental homes. The Company's operating expense ratio (defined as community operating expenses divided by rental and related income) was 41.0% and 41.6% for the three and six months ended June 30, 2025, respectively, and 41.9% for the three and six months ended June 30, 2024. Many recently acquired communities have deferred maintenance requiring higher than normal expenditures in the first few years of ownership. Since most of the community expenses consist of fixed costs, as occupancy rates increase, these expense ratios are expected to continue to improve. Due to the Company's ability to increase its rental rates annually (subject to limitations on rent increases in certain jurisdictions), increasing costs due to inflation and changing prices have generally not had a material effect on revenue and income from continuing operations.

Sales of manufactured homes increased 19% from $8.8 million, or 105 homes, for the three months ended June 30, 2024 to $10.5 million, or 102 homes, for the three months ended June 30, 2025. The average sales price was $103,000 and $84,000 for the three months ended June 30, 2025 and 2024, respectively. Cost of sales of manufactured homes amounted to $7.1 million and $5.5 million for the three months ended June 30, 2025 and 2024, respectively. The gross profit percentage was 32% and 38% for the three months ended June 30, 2025 and 2024, respectively. Selling expenses, which includes salaries, commissions, advertising and other miscellaneous expenses, amounted to $1.8 million and $1.7 million for the three months ended June 30, 2025 and 2024, respectively. Gain from the sales operations (defined as sales of manufactured homes, less cost of sales of manufactured homes, less selling expenses, less interest on the financing of inventory) amounted to $1.3 million or 13% of total sales and $1.4 million or 16% of total sales for the three months ended June 30, 2025 and 2024, respectively. Gain from the sales operations, excluding interest on the financing of inventory, amounted to $1.5 million or 14% of total sales and $1.6 million or 18% of total sales for the three months ended June 30, 2025 and 2024, respectively.

Sales of manufactured homes increased 6% from $16.2 million, or 200 homes, for the six months ended June 30, 2024 to $17.1 million, or 173 homes, for the six months ended June 30, 2025. The average sales price was $99,000 and $81,000 for the six months ended June 30, 2025 and 2024, respectively. Cost of sales of manufactured homes amounted to $11.5 million and $11.0 million for the six months ended June 30, 2025 and 2024, respectively. The gross profit percentage was 33% and 32% for the six months ended June 30, 2025 and 2024, respectively. Selling expenses amounted to $3.5 million and $3.4 million for the six months ended June 30, 2025 and 2024, respectively. Gain from the sales operations amounted to $2.0 million or 11% of total sales and $1.4 million or 9% of total sales for the six months ended June 30, 2025 and 2024, respectively. Gain from the sales operations, excluding interest on the financing of inventory, amounted to $2.2 million or 13% of total sales and $1.8 million or 11% of total sales for the six months ended June 30, 2025 and 2024, respectively. Many of the costs associated with sales, such as salaries, and to an extent, advertising and promotion, are fixed.

Conventional home prices have flattened as sellers begin to outnumber buyers. However, housing market supply remains tight nationally and interest rates remain elevated. The inherent relative affordability of our property type has become more and more apparent, which should result in increased demand. The Company continues to be optimistic about future sales and rental prospects given the fundamental need for affordable housing. The Company believes that sales of new homes produce new rental revenue and represent an investment in the upgrading of our communities.

General and administrative expenses increased 14% from $5.5 million for the three months ended June 30, 2024 to $6.3 million for the three months ended June 30, 2025. General and administrative expenses increased 13% from $10.9 million for the six months ended June 30, 2024 to $12.3 million for the six months ended June 30, 2025. General and administrative expenses increased primarily due to an increase in payroll and related personnel costs and professional fees. General and administrative expenses as a percentage of gross revenue (total income plus interest, dividends and other income) was 9.0% and 9.2% for the three and six months ended June 30, 2025, respectively, as compared to 8.8% and 8.9% for the three and six months ended June 30, 2024, respectively.

Depreciation expense increased 5% from $15.0 million for the three months ended June 30, 2024 to $15.7 million for the three months ended June 30, 2025. Depreciation expense increased 9% from $29.7 million for the six months ended June 30, 2024 to $32.4 million for the six months ended June 30, 2025. This increase was primarily due to acquisitions and the increase in rental homes and expansions during 2024 and 2025.

Interest income increased 37% from $1.5 million for the three months ended June 30, 2024 to $2.1 million for the three months ended June 30, 2025. Interest income increased 41% from $3.1 million for the six months ended June 30, 2024 to $4.3 million for the six months ended June 30, 2025. This increase was primarily due to an increase in the average balance of notes receivable from $78.1 million at June 30, 2024 to $92.3 million at June 30, 2025. The weighted average interest rate earned on these notes receivable increased 10 basis points and were approximately 7.1% and 7.0% as of June 30, 2025 and 2024, respectively.

Dividend income remained relatively stable for the three and six months ended June 30, 2025 compared to the three and six months ended June 30, 2024.

The increase (decrease) in fair value of marketable securities amounted to a decrease of $175,000 and an increase of $3.3 million for the three months ended June 30, 2025 and 2024, respectively. The decrease in fair value of marketable securities amounted to $1.7 million and $2.0 million for the six months ended June 30, 2025 and 2024, respectively. As of June 30, 2025, the Company had total net unrealized losses of $40.3 million in its REIT securities portfolio.

Interest expense, including amortization of financing costs, remained relatively stable for the three months ended June 30, 2025 compared to the three months ended June 30, 2024. Interest expense, including amortization of financing costs, decreased 10% from $14.8 million for the six months ended June 30, 2024 to $13.3 million for the six months ended June 30, 2025. This decrease was due to a decrease in the average balance of mortgages and loans from $579.2 million at June 30, 2024 to $535.8 million at June 30, 2025. The weighted average interest rate on our total debt was 4.6% at June 30, 2025 and 2024.

**<u>Changes in Financial Condition</u>**

Total investment property increased 4% or $71.1 million during the six months ended June 30, 2025. In addition to adding 237 rental homes, net of 78 rental homes sold, to its communities during the six months ended June 30, 2025, the Company is preparing sites for additional homes to be added during the year. The Company also purchased two communities for approximately $24.6 million during the six months ended June 30, 2025. Occupied rentals increased by 259 rental homes from December 31, 2024 to June 30, 2025. The Company's occupancy rate on its rental homes portfolio increased 40 basis points and was 94.4% at June 30, 2025 as compared to 94.0% at December 31, 2024.

Marketable securities decreased 5% or $1.7 million during the six months ended June 30, 2025 due to the net decrease in fair value.

Land development costs increased 83% or $28.2 million during the six months ended June 30, 2025 due to an increase in expansion projects.

Mortgages payable, net of unamortized debt issuance costs, increased 9% or $44.7 million during the six months ended June 30, 2025, due to a new mortgage of approximately $101.4 million offset by mortgage payoffs of approximately $49.5 million and principal payments of approximately $5.7 million.

Loans payable, net of unamortized debt issuance costs, decreased 2% or $640,000 during the six months ended June 30, 2025.

**<u>Liquidity and Capital Resources</u>**

The Company's focus is on real estate investments, including investment in rental homes. The Company's principal liquidity demands have historically been, and are expected to continue to be, distributions to the Company's shareholders, acquisitions, capital improvements, development and expansions of properties, debt service, purchases of manufactured home inventory and rental homes, financing of manufactured home sales and payments of expenses relating to real estate operations. We anticipate that the liquidity demands of the recent properties acquired will be met by the operations of these acquisitions. The Company's ability to generate cash adequate to meet these demands is dependent primarily on income from its real estate investments, the sale of real estate investments, refinancing of mortgage debt, leveraging of real estate investments, availability of bank borrowings, lines of credit, and other incurrence of indebtedness, proceeds from the DRIP, and access to the capital markets, including through its Common and Preferred ATM Programs.

In addition to cash generated through operations, the Company uses a variety of sources to fund its cash needs, including acquisitions. The Company may sell marketable securities from its investment portfolio, borrow on its unsecured credit facility or lines of credit, incur other indebtedness, finance and refinance its properties, and/or raise capital through the DRIP and capital markets, including through the Company's ATM Programs. In order to provide financial flexibility to opportunistically access the capital markets, on September 16, 2024, the Company terminated its successful then-existing at-the-market Common Stock ATM Program and implemented a new September 2024 Common ATM Program which allows the Company to offer and sell shares of the Company's Common Stock, having an aggregate sales price of up to $150 million, from time to time through the Distribution Agents. As of June 30, 2025, $49.4 million of common stock remained eligible for sale under the September 2024 Common ATM Program. Additionally, on March 5, 2025, the Company terminated its then-existing 2023 Preferred ATM Program and implemented a new 2025 Preferred ATM Program which allows the Company to offer and sell shares of the Company's Series D Preferred Stock having an aggregate sales price of up to $100 million from time to time through B. Riley, as Distribution Agent.

The Company intends to continue to increase its real estate investments. Our business plan includes acquiring communities that over time are expected to yield in excess of our cost of funds and then investing in physical improvements, including adding rental homes onto otherwise vacant sites. As part of this plan, we intend to continue to seek opportunities, through our opportunity zone fund, to acquire communities that require substantial capital investment and are located in qualified opportunity zones. In addition, on behalf of our joint venture with Nuveen Real Estate, we will continue to seek opportunities to acquire manufactured home communities that are under development and/or newly developed and meet certain other investment guidelines. There is no guarantee that any of these additional opportunities will materialize or that the Company will be able to take advantage of such opportunities. The growth of our real estate portfolio and success of our joint venture depends on the availability of suitable properties which meet the Company's investment criteria and appropriate financing. Competition in the market areas in which the Company operates is significant. To the extent that funds or appropriate communities are not available, fewer acquisitions will be made.

The Company continues to strengthen its capital and liquidity positions. During the six months ended June 30, 2025, the Company issued and sold 2.3 million shares of Common Stock through our September 2024 Common ATM Program, at a weighted average price of $17.74 per share, generating gross proceeds of $40.4 million and net proceeds of $39.6 million, after offering expenses. Subsequent to quarter end, the Company issued and sold an additional 160,000 shares of its Common Stock under the September 2024 Common ATM Program at a weighted average price of $16.99 per share, generating gross and net proceeds, after offering expenses, of $2.7 million.

In addition, during the six months ended June 30, 2025, the Company issued and sold 49,000 shares of Series D Preferred Stock through our 2023 Preferred ATM Program, at a weighted average price of $23.03 per share, generating gross proceeds of $1.1 million and net proceeds of $982,000, after offering expenses.

The Company also raised $4.8 million from the issuance of common stock in the DRIP during the six months ended June 30, 2025, which included dividend reinvestments of $1.7 million. Dividends paid on the common stock for the six months ended June 30, 2025 were $36.7 million, including the $1.7 million reinvested. Dividends paid on the Series D Preferred Stock for the six months ended June 30, 2025 totaled $10.3 million.

Subsequent to quarter end, the Company issued approximately $80.2 million aggregate principal amount of its 5.85% Series B Bonds due 2030 in an offering to investors in Israel. The net proceeds, after deducting offering discounts, fees and other transaction costs, are estimated to be approximately $75.2 million. See Note 13 for additional information.

Net cash provided by operating activities amounted to $37.2 million and $37.6 million for the six months ended June 30, 2025 and 2024, respectively. As of June 30, 2025, the Company had cash and cash equivalents of $79.2 million, marketable securities of $30.2 million and $260 million available on our credit facility, with a potential total availability of up to $500 million pursuant to an accordion feature. We also had approximately $139 million available on our revolving lines of credit for the financing of home sales and purchases of inventory and $55 million available on our line of credit secured by rental homes and rental homes leases.

As of quarter end, the Company owned and operated 142 communities (including three communities owned by the Company's joint venture with Nuveen, in which the Company has a minority interest), of which 57 are unencumbered. Subsequent to quarter end, the Company acquired two additional manufactured home communities in Maryland which are also unencumbered. Except for communities in the borrowing base for our unsecured credit facility, these unencumbered communities can be used to raise additional funds. Our marketable securities, unencumbered properties, and lines of credit provide the Company with additional liquidity. The Company holds a 40% equity interest in the entities formed under its joint venture with Nuveen, which owns three newly developed communities that are unencumbered.

As of June 30, 2025, the Company had total assets of $1.6 billion and total liabilities of $690.3 million. The Company's net debt (net of unamortized debt issuance costs and cash and cash equivalents) to total market capitalization as of June 30, 2025 was approximately 31% and the Company's net debt, less securities to total market capitalization as of June 30, 2025 was approximately 29%. As of June 30, 2025, the Company had fourteen mortgages totaling $75.6 million due within the next 12 months and sixteen mortgages totaling $99.7 million within the next 18 months. The Company believes that it has the ability to meet its obligations and to generate funds for new investments.

**<u>Off-Balance Sheet Arrangements</u>**

The Company does not have any off-balance sheet arrangements.

**<u>Cautionary Statement Regarding Forward-Looking Statements</u>**

Statements contained in this Form 10-Q, that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Forward-looking statements provide our current expectations or forecasts of future events. Forward-looking statements include statements about the Company's expectations, beliefs, intentions, plans, objectives, goals, strategies, future events, performance and underlying assumptions and other statements that are not historical facts. Forward-looking statements can be identified by their use of forward-looking words, such as "may," "will," "anticipate," "expect," "believe," "intend," "plan," "should," "seek" or comparable terms, or the negative use of those words, but the absence of these words does not necessarily mean that a statement is not forward-looking.

The forward-looking statements are based on our beliefs, assumptions and expectations of our future performance, taking into account all information currently available to us. Forward-looking statements are not predictions of future events. These beliefs, assumptions and expectations can change as a result of many possible events or factors, not all of which are known to us. Some of these factors are described below and under the headings "Business", "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our periodic reports filed with the Securities and Exchange Commission. These and other risks, uncertainties and factors could cause our actual results to differ materially from those included in any forward-looking statements we make. Any forward-looking statement speaks only as of the date on which it is made. New risks and uncertainties arise over time, and it is not possible for us to predict those events or how they may affect us. Except as required by law, we are not obligated to, and do not intend to, update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Important factors that could cause actual results to differ materially from our expectations include, among others:

● changes in the real estate market conditions and general economic conditions;

● the inherent risks associated with owning real estate, including local real estate market conditions, governing laws and regulations affecting manufactured housing communities and illiquidity of real estate investments;

● increased competition in the geographic areas in which we own and operate manufactured housing communities;

● our ability to continue to identify, negotiate and acquire manufactured housing communities and/or vacant land which may be developed into manufactured housing communities on terms favorable to us;

● our ability to maintain or increase rental rates and occupancy levels;

● changes in market rates of interest;

● inflation and increases in costs, including personnel, insurance and the cost of purchasing manufactured homes;

● our ability to purchase manufactured homes for rental or sale;

● our ability to repay debt financing obligations;

● our ability to refinance amounts outstanding under our credit facilities at maturity on terms favorable to us;

● our ability to comply with certain debt covenants;

● our ability to integrate acquired properties and operations into existing operations;

● the availability of other debt and equity financing alternatives;

● continued ability to access the debt or equity markets;

● the loss of any member of our management team;

● our ability to maintain internal controls and processes to ensure all transactions are accounted for properly, all relevant disclosures and filings are made in a timely manner in accordance with all rules and regulations, and any potential fraud or embezzlement is thwarted or detected;

● the ability of manufactured home buyers to obtain financing;

● the level of repossessions by manufactured home lenders;

● market conditions affecting our investment securities;

● changes in federal or state tax rules or regulations that could have adverse tax consequences;

● our ability to qualify as a real estate investment trust for federal income tax purposes;

● litigation, judgments or settlements, including costs associated with prosecuting or defending claims and any adverse outcomes;

● changes in real estate and zoning laws and regulations;

● legislative or regulatory changes, including changes to laws governing the taxation of REITs;

● risks and uncertainties related to pandemics or other highly infectious or contagious diseases; and

● those risks and uncertainties referenced under the heading "Risk Factors" contained in this Form 10-Q and the Company's other filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2024.

You should not place undue reliance on these forward-looking statements, as events described or implied in such statements may not occur. The forward-looking statements contained in this Form 10-Q speak only as of the date hereof and the Company expressly disclaims any obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events, or otherwise.

**Item 3.** **Quantitative and Qualitative Disclosures About Market Risk**

There have been no material changes to information required regarding quantitative and qualitative disclosures about market risk from the end of the preceding year to the date of this Quarterly Report on Form 10-Q.

**Item 4.** **Controls and Procedures**

The Company's President and Chief Executive Officer (principal executive officer) and the Company's Executive Vice President and Chief Financial Officer (principal financial and accounting officer), with the assistance of other members of the Company's management, have evaluated the effectiveness of the Company's disclosure controls and procedures as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on such evaluation, the Company's President and Chief Executive Officer and Executive Vice President and Chief Financial Officer have concluded that the Company's disclosure controls and procedures are effective as of the end of such period.

**<u>Changes In Internal Control Over Financial Reporting</u>**

There were no changes in the Company's internal control over financial reporting during the quarterly period ended June 30, 2025 that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.

**PART II – OTHER INFORMATION**

**Item 1.** **Legal Proceedings**

None.

---

| | |
|:---|:---|
| **Item 1A.** | **Risk Factors** |

---

There have been no material changes to information required regarding risk factors from the end of the preceding year to the date of this Quarterly Report on Form 10-Q. In addition to the other information set forth in this Quarterly Report on Form 10-Q, you should carefully consider the factors discussed in Part I, Item 1A – "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2024, which could materially affect the Company's business, financial condition or future results. The risks described in the Company's Annual Report on Form 10-K are not the only risks facing the Company. Additional risks and uncertainties not currently known to the Company or that the Company currently deems to be immaterial also may materially adversely affect the Company's business, financial condition and/or operating results.

**Item 2.** **Unregistered Sales of Equity Securities and Use of Proceeds**

None.

**Item 3.** **Defaults Upon Senior Securities**

None.

**Item 4.** **Mine Safety Disclosures**

None.

**Item 5.** **Other Information**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Information Required to be Disclosed in a Report on Form 8-K,
but not Reported – None.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Material Changes to the Procedures by which Security Holders
may Recommend Nominees to the Board of Directors – None.

**Item 6.** **Exhibits**

---

| | |
|:---|:---|
| **4.1** | [Deed of Trust for the 5.85% Series B Bonds due 2030 between UMH Properties, Inc. and Reznik Paz Nevo Trusts Ltd., as trustee, dated as of July 18, 2025 (Filed herewith).](ex4-1.htm) |
| **10.1** | [Reaffirmation, Joinder and Fifth Amendment dated as of May 15, 2025 to Master Credit Facility Agreement dated as of August 20, 2020, as previously amended, among certain subsidiaries of the Company, as borrowers, Wells Fargo Bank, National Association, as lender, and Fannie Mae (with attached Master Credit Facility Agreement dated as of August 20, 2020 and Confirmation of Guaranty by UMH Properties, Inc. dated as of May 15, 2025).](ex10-1.htm) |
| **31.1** | [Certification of Samuel A. Landy, President and Chief Executive Officer of the Company, pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended (Filed herewith).](ex31-1.htm) |
| **31.2** | [Certification of Anna T. Chew, Chief Financial Officer of the Company, pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended (Filed herewith).](ex31-2.htm) |
| **32** | [Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, signed by Samuel A. Landy, President and Chief Executive Officer, and Anna T. Chew, Chief Financial Officer (Furnished herewith).](ex32.htm) |
| **101** | The following materials from the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2025 formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Income (Loss), (iii) the Consolidated Statements of Shareholders' Equity, (iv) the Consolidated Statements of Cash Flows and (v) the Notes to Consolidated Financial Statements.<br>As provided in Rule 406T of Regulation S-T, this information is furnished and not filed for purposes of Sections 11 and 12 of the Securities Act of 1933 and Section 18 of the Securities Exchange Act of 1934. |
| **101.INS** | Inline XBRL Instance Document |
| **101.SCH** | Inline XBRL Taxonomy Extension Schema Document |
| **101.CAL** | Inline XBRL Taxonomy Extension Calculation Linkbase Document |
| **101.DEF** | Inline XBRL Taxonomy Extension Definition Linkbase Document |
| **101.LAB** | Inline XBRL Taxonomy Extension Label Linkbase Document |
| **101.PRE** | Inline XBRL Taxonomy Extension Presentation Linkbase Document |
| **104** | Cover Page Interactive Data File (embedded within the Inline XBRL document) |

---

**SIGNATURES**

Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

---

| | | | |
|:---|:---|:---|:---|
|  |  | UMH PROPERTIES, INC. | UMH PROPERTIES, INC. |
| DATE: | August 6, 2025 | By | */s/ Samuel A. Landy* |
|  |  |  | Samuel A. Landy |
|  |  |  | President and Chief Executive Officer |
|  |  |  | (Principal Executive Officer) |
| DATE: | August 6, 2025 | By | */s/ Anna T. Chew* |
|  |  |  | Anna T. Chew |
|  |  |  | Executive Vice President and Chief Financial Officer |
|  |  |  | (Principal Financial and Accounting Officer) |

---

## Exhibit 4.1

**Exhibit 4.1**

**<u>[CONVENIENCE TRANSLATION FROM</u>**

**<u>THE ORIGINAL HEBREW VERSION]</u>**

**<u>UMH PROPERTIES, INC.</u>**

**Deed of Trust**

**For Bonds Offered to the Public**

**Prepared and executed on the 18<sup>th</sup> day of July 2025**

**Between UMH PROPERTIES, INC. and Reznik Paz Nevo Trusts Ltd.**

**Table of Contents**

---

| | | |
|:---|:---|:---|
| **Section** | **Subject** | **Page** |
| **Deed of Trust** | **Deed of Trust** | **Deed of Trust** |
| **1** | Preamble, Interpretation and Definitions | 2 |
| **2** | Issuance of the Bonds | 8 |
| **3** | Appointing the Trustee and the Duties Thereof | 13 |
| **4** | Powers of the Trustee | 14 |
| **5** | Repurchase of Bonds by the Company | 15 |
| **6** | Covenants of the Company | 17 |
| **7** | Interest Rate Adjustments | 23 |
| **8** | Security and Seniority of the Bonds | 27 |
| **9** | Early Redemption | 27 |
| **10** | Call for Immediate Repayment | 31 |
| **11** | Claims and Proceedings by the Trustee | 37 |
| **12** | Trust over Receipts | 38 |
| **13** | Power to Withhold Distribution of Funds | 39 |
| **14** | Failure to Make Payment for Reason Beyond the Company's Control | 39 |
| **15** | Receipts as Proof | 40 |
| **16** | Undertakings of the Company to the Trustee | 40 |
| **17** | The Trustee as Representative | 43 |
| **18** | Other Agreements between the Trustee and the Company | 43 |
| **19** | Reporting by the Trustee | 43 |
| **20** | Trustee's Fees | 44 |
| **21** | Special Powers of the Trustee | 46 |
| **22** | Trustee's Authority to Engage Agents | 47 |
| **23** | Indemnification of the Trustee | 47 |
| **24** | Notices | 51 |
| **25** | Waiver and Settlement | 52 |
| **26** | Bondholders Register | 53 |
| **27** | Replacement of the Trustee | 53 |
| **28** | Reporting to the Trustee and to the Bondholders | 54 |
| **29** | Bondholders' Meetings | 55 |
| **30** | Governing Law | 55 |
| **31** | Trustee's Responsibility | 55 |
| **32** | Addresses | 56 |
| **Schedule I – Form of Bond Certificate** | **Schedule I – Form of Bond Certificate** | **57** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Terms and Conditions Overleaf** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Terms and Conditions Overleaf** | **58** |
| **Schedule II – General Meetings of Bondholders** | **Schedule II – General Meetings of Bondholders** | **63** |
| **Schedule III – Urgent Representation of Bondholders** | **Schedule III – Urgent Representation of Bondholders** | **71** |

---

**<u>DEED OF TRUST</u>**

Made and entered into on July 18, 2025

---

| | |
|:---|:---|
| **Between:** | **UMH PROPERTIES, INC** |

---

File Number 22-1890920

3499 US Highway 9, Ste 3C

Freehold, NJ, 07728-3277 USA

Telephone: +(1) 732-577-997

Fax: +(1)732-577-9980 (the "**Company**")

The Company's address in Israel for purposes of service of process:

98 Yigal Alon Street, Tel Aviv 6789141

c/o Goldfarb Gross Seligman & Co. Law Offices

Telephone: 03-608-9999

Facsimile: 03-608-9909

<u>on one side</u>;

---

| | |
|:---|:---|
| **And:** | **Reznik Paz Nevo Trusts Ltd.** |

---

From 14 Yad Harutzim Street, Tel Aviv, Israel

Tel: 03-6380200

Fax: 03-6289222

(hereinafter: the "**Trustee**")

<u>on the other</u>;

---

| | |
|:---|:---|
| WHEREAS: | The Company was incorporated under the laws of the State of Maryland, USA, its Common Shares and certain other securities are listed on the New York Stock Exchange (NYSE), and its common shares and Series A bonds are listed for trading on the Tel Aviv Stock Exchange; and |
| WHEREAS: | The Company's Board of Directors resolved on July 18, 2025 to approve an offering to the public in Israel of bonds (the "**Offering**") under the terms and conditions set forth in this Deed of Trust, and no additional action or resolution is required by the Company in order to pursue the Offering and for assume the undertaking set forth in this Deed of Trust; and |
| WHEREAS: | The Company represents that it has obtained all approvals required under any applicable law (Israeli and foreign laws) and/or any contract for issuing the Bonds, and there is no impediment under any law and/or any contract to effectuating the Offering; and |
| WHEREAS: | The Company intends to issue the Bonds in the manner and in accordance with the provisions set forth in this Deed of Trust; and |
| WHEREAS: | On July 3, 2025, S&P Global Ratings Maalot Ltd. ("Maalot") issued with respect to the Bonds an ilAA- rating (such rating, or any corresponding rating issued by a successor Rating Agency, the "**Base Credit Rating**") for a bond issuance by the Company; and |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS: | The Trustee is a company limited by shares and is incorporated in Israel under the Companies Law, 5759-1999 (the "**Companies Law**"), whose main purpose is to engage in trusteeships; and |
| WHEREAS: | The Trustee represents that there is no prevention under the Securities Law (as defined below) and/or any other law for its appointment as the Trustee for the Bonds, nor to its entering into this Deed of Trust with the Company, and that it complies with the requirements and the competency qualification, if any, to serve as Trustee for the Bondholders ; and |
| WHEREAS: | The Company has requested the Trustee to serve as Trustee to the Bondholders, and the Trustee has agreed to serve under Chapter E' of the Securities Law, all subject to and in accordance with the terms of this Deed of Trust; and |
| WHEREAS: | The Trustee has no interest in the Company, and the Company has no interest in the Trustee. |

---

**Now, therefore, it is agreed, declared, and stipulated by the parties as follows:** 

1.  **<u>Preamble, Interpretation and Definitions</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;1.1 The preamble to this Deed of Trust and the schedules attached hereto constitute a material and integral
part hereof.

&nbsp;&nbsp;&nbsp;&nbsp;1.2 The division of this Deed of Trust into sections and the provision of headings for such Sections are for
the sake of convenience and reference only and shall not be used for purposes of interpretation.

&nbsp;&nbsp;&nbsp;&nbsp;1.3 All references in this Deed of Trust in the plural shall also include the singular and *vice versa*,
anything appearing in the masculine gender shall also include the feminine and *vice versa*, and any reference to a person shall
also include a corporation, unless otherwise explicitly provided.

&nbsp;&nbsp;&nbsp;&nbsp;1.4 In this Deed of Trust, its schedules and the Bonds, the following capitalized terms will have the meanings
prescribed opposite them, unless explicitly stated otherwise:

---

| | |
|:---|:---|
| "**Affiliate**" - | An entity in which another person (which is not its parent corporation) holds 25% or more of its Voting Stock or of the Rights conferring voting rights therein, or in which it may appoint 25% or more of its directors;<br>|
| "**Base Rate**" - | The average dollar exchange rate, on the Clearing Day of the Offering, as determined in the Bloomberg system in "ILS CMPL Currency", based on the average closing rates in 7 samples to be performed at 15-minute intervals between 12:00 (inclusive) and 13:30 (inclusive). The Company will announce the Base Rate by way of an Immediate Report at the end of the Clearing Date and prior to the listing whereby the immediate report shall also include a detailed calculation of the base rate; |

---

---

| | |
|:---|:---|
| "**Bond Certificate**" - | A certificate in the form set forth in the <u>First Schedule</u> to this Deed; |
| "**Bondholder**" or "**Holder**" - | As the term "Holder" or "Bondholder" is defined in Section 35A of the Securities Law; |
| "**Bondholders' Meeting**" - | A general meeting of the Bondholders convened in accordance with the terms of this Deed of Trust; |
| "**Bonds**" or "**Bonds (Series B)**" - | The Bonds (Series B) issued by the Company pursuant to this Deed, the terms of which are set forth in the Bond Certificate; |
| "**Business Day**" - | Any day on which the Stock Exchange Clearing House and most of the banks in Israel are open for carrying out transactions; |
| "**Change of Control**" - | If any person, other than one or more Authorized Shareholders (as defined below), is or becomes the holder, directly or indirectly, of more than 50% of the total voting rights of the Voting Stock of the Company or becomes a Controlling Shareholder pursuant to applicable law; provided that if the Company becomes the Subsidiary (as defined below), directly or indirectly, of a holding company, such holding company shall not itself be considered such a person if (a) such holding company owns, directly or indirectly, 100% of the Company's Share Capital and (b) upon completion of such transaction, no person, other than one or more Authorized Shareholders, is or becomes the holder, directly or indirectly, of more than 50% of the total voting rights of the Voting Stock of such holding company; |
| "**Clearing House**" - | The Tel Aviv Stock Exchange Clearing House Ltd.; |
| "**Regulation Codex" -** <br>| The Regulation Codex – Title 5 – principles for conducting businesses, Part 2 – equity, measurement and risk management, Chapter 4 – managing investment properties, as published by the Capital Market, Insurance and Savings Authority of the Ministry of Finance, as updated from time to time;<sup>1</sup>  |

---

<sup>1</sup> https://www.gov.il/he/Departments/Guides/information-entities-codex

---

| | |
|:---|:---|
| "**CFO Certificate**" - | A certificate executed by the Chief Financial Officer of the Company with respect to the Company's compliance with specific provisions of this Deed of Trust, which in any event in which it is required under this Deed of Trust, will be in form and content reasonably satisfactory to the Trustee; |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; "**Consumer Price Index**" -<br>| The Israeli Consumer Price Index, which includes vegetables and fruit and is published by the Israeli Central Bureau of Statistics, and any similar index published by any successor institute or body, whether or not such index will be based on the same data on which the existing index is based as of the date of this Deed, provided that if such similar index shall be published by a successor institute or body which has not determined the ratio between the existing index as of the date of this Deed and the similar index, such ratio shall be determined by the Israeli Central Bureau of Statistics, and in the event that such ratio shall not have been determined, then the ratio shall be determined by the Trustee following its consultation with an economic expert chosen by the Trustee for such purpose; |
| "**Credit Facility**" | With respect to the Company or any of its Subsidiaries, any obligation or debt, or commercial paper facilities with banks or other lenders providing credit, including revolving credit or term loans or any agreement treated as a financial or capital lease in accordance with U.S. GAAP. |
| "**Cross Default**" | Calling for the immediate repayment of a Credit Facility, if said calling for an immediate repayment:<br>(a) was caused by a failure to pay principal of, or interest or premium, if any, on outstanding indebtedness under such Credit Facility (other than non-recourse indebtedness of any of the Company's Subsidiaries) prior to the expiration of the grace period for the repayment payment of such indebtedness set forth in such Credit Facility ("**Payment Default**"); or<br>(b) results in the acceleration of such indebtedness prior to its maturity;<br>and, in any event, the principal amount of any such indebtedness, together with the principal amount of any other such indebtedness under which there has been a call for an Immediate repayment as aforesaid, if any, exceeds $75,000,000. |

---

---

| | |
|:---|:---|
| "**Issuance Date**" **-** | The Business Day on which the Offering proceeds are deposited in the Offering coordinator's account; |
| "**Deed**" or the "**Deed of Trust**" or "**This Deed of Trust**" | This Deed of Trust including the schedules attached hereto, which form an integral part thereof; |
| "**Dollar**" - | United States dollar; |
| "**Financial** <br> **Statements**" **-**  | The Company's consolidated statements of assets and liabilities, consolidated statements of operations, consolidated statements of changes in net assets, consolidated statements of cash flows and consolidated schedules of investments for a given fiscal period prepared in accordance with U.S. GAAP and, to the extent required, according to any other accounting standard to which the Company may be subject, as shall be in effect from time to time (including additional statements), with a copy or reference to the filing published on the MAGNA website; |
| "**Group**" - | The Company and its Subsidiaries; |
| "**Listing**" or "**Listed**"- | Listing or listed for trade on the Stock Exchange; |
| "**NIS**" - | New Israeli Shekel; |
| "**Nominee Company**" - | The Tel Aviv Stock Exchange Nominee Company Ltd. or any other substitute nominee company and provided that all the securities which the Company is required to register in a nominee company in Israel, will be registered in its name; |
| "**Ordinary Resolution**" - | A resolution, obtained by way of a simple majority, adopted at a Bondholders' Meeting, in which there were present (in person or by proxy), at least two Bondholders that together hold at least twenty-five percent (25%) of the outstanding balance of the par value of the Bonds or at an adjourned meeting in which there were present any number of holders (in person or by proxy); |

---

---

| | |
|:---|:---|
| "**Payment Rate**" - | In respect of any payment of Principal or interest under this Deed of Trust (including, without limitation, upon early redemption or acceleration of the Bonds), the Representative Rate published on the Record Date before the applicable payment date, or if the Representative Rate was not published on such date, then the rate on the first subsequent Business Day; |
| "**Authorized** <br> **Shareholders**" - | Any of (a) Eugene Landy and Samuel A. Landy or any of their estates, spouses, and/or descendants; (b) any trust in favor of any of the persons listed in (a) above only; |
| "**Person**" | any individual, corporation, partnership, joint venture, joint-stock company, trust, unincorporated organization or government or any agency or political subdivision thereof;  |
| "**Offering Clearing Day**" | The Business Day on which the Offering proceeds are deposited in the Offering coordinator's account; |
| "**Principal**" - | The aggregate outstanding balance of the principal amount of the Bonds in circulation; |
| **"Prospectus**" - | The Company's prospectus, dated July 21, 2025, under which the Company offered the Bonds to the public in Israel; |
| **"Public Tender" -** | The public tender to be held in connection with the initial public offering of the Bonds; |
| "**Publishing**" or "**Publish**" - | Publishing on the Israel Security Authority's MAGNA website, or, if the Company is no longer a Reporting Corporation, reporting to the Trustee in accordance with Subsection 28.4 hereunder; |
| "**Rating Agency**" - | An Israeli company engaged in credit ratings that is registered under the Regulation of Activities of Credit Rating Companies Law, 5774-2014; |
| "**Register**" - | The register of Bondholders as referred to in Section 26 of this Deed; |
| "**Reporting Corporation**"- | As defined in the Securities Law or any corporation listed for trading on a stock exchange outside of Israel set forth in the Second Schedule or in the Third Schedule of the Securities Law; |

---

---

| | |
|:---|:---|
| "**Representative<br> Rate**" - | The representative exchange rate of the Dollar to the NIS as published by the Bank of Israel, or any other official exchange rate of the Dollar to the NIS that may replace it, if applicable, provided that during any period in which the Bank of Israel does not publish exchange rates of the Dollar to the NIS, and there is no official exchange rate that replaces it, the Representative Rate shall be the exchange rate of the Dollar to the NIS determined by the Minister of Finance together with the Governor of the Bank of Israel for purposes of Dollar-linked government bonds or, in the absence of such determination, then the Representative Rate shall be the exchange rate of the Dollar to the NIS determined by an economic expert as reasonably selected by the Trustee; |
| "**Securities Law**" - | The Securities Law, 5728-1968, and the regulations enacted/ will be enacted thereunder, from time to time; |
| "**Insolvency Law**" | Insolvency and Economic Rehabilitation Law, 5778-2018, and regulations enacted /will be enacted pursuant thereto, from time to time; |
| "**Special Resolution**" - | A resolution adopted at a Bondholders' Meeting, there were present (in person or by proxy) Bondholders who together hold at least fifty percent (50%) of the outstanding balance of the par value of the Bonds or at an adjourned meeting attended by (in person or by proxy) Bondholders who together hold at least twenty percent (20%) of the outstanding par value of the Bonds, by a 2/3 (two thirds) majority of Bondholders participating in the vote, excluding abstentions; |
| "**Stock Exchange**" or "**TASE**"-<br>| The Tel Aviv Stock Exchange Ltd.; |
| "**Subsidiary**" | In respect of any person, any corporation, limited or general partnership or other business entity that: (a) on the record date more than 50% of the voting rights of the Voting Stock or other interests (including partnership interests) entitled (irrespective of the occurrence of any contingency) to vote in the appointment of directors, managers or trustees thereof is owned or controlled, directly or indirectly, by (i) such person, (ii) such person and one or more Subsidiaries of such person or (iii) one or more Subsidiaries of such person or (b) on the record date it holds control, directly or indirectly, including joint control. |

---

---

| | |
|:---|:---|
| "**Trading Day**" - | Any day on which trading takes place on the Stock Exchange; |
| "**Trustee**" - | Reznik Paz Nevo Trusts Ltd. or any other Person which will act from time to time as trustee for the Bondholders under this Deed pursuant to Chapter E' of the Securities Law;<br>|
| **"U.S. GAAP" -** | United States Generally Accepted Accounting Principles as in effect on 30 June, 2025; |
| "**Voting Stock**" **-** | The capital stock of any corporation or other legal entity as of any date that has a right to vote on the appointing of directors and in general meetings; |
| **"Voting Rights Interests" –** | Rights in any corporation or other legal entity at any given time that confer voting entitlement in the appointment of directors and in general meetings. |

---

Other terms not defined above shall bear the meaning prescribed thereto in the Securities Law, unless otherwise explicitly stated.

&nbsp;&nbsp;&nbsp;&nbsp;1.5 In any event of a contradiction between this Deed of Trust and its Schedules, the provisions of this Deed
of Trust shall prevail. The Company hereby confirms and clarifies, that as of the date of this Deed, there exists no contradiction between
this Deed of Trust and the documents ancillary thereto and the provisions described in the Prospectus relating to this Deed and/or the
Bonds.

&nbsp;&nbsp;&nbsp;&nbsp;1.6 For as long as the Bonds are listed, this Deed of Trust, including its Schedules, shall be subject to
the applicable provisions of the bylaws and guidelines of the Stock Exchange, as in effect from time to time, and anywhere the rules of
the Stock Exchange apply or shall apply to any action under this Deed of Trust, the rules of the Stock Exchange shall prevail.

&nbsp;&nbsp;&nbsp;&nbsp;1.7 Wherever the phrase "including" is used, it shall be interpreted as an example that neither
reduces nor limits the generality of that certain term.

&nbsp;&nbsp;&nbsp;&nbsp;1.8 Wherever "subject to the provisions of applicable law" or a similar term is used, it shall be
interpreted as subject to the provisions of the cogent law.

**2.**  **<u>Issuance of the Bonds</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;2.1 The Company shall carry out an initial issuance of the Bonds, which shall be registered by name, in a
total amount that shall not exceed the amount to be set forth in the Supplementary Notice to be Published by virtue of the Prospectus.
The Principal and Interest of the Bonds shall be linked to the Dollar.

&nbsp;&nbsp;&nbsp;&nbsp;2.2 The Principal of the Bonds shall be repaid in one installment on June 30, 2030.

&nbsp;&nbsp;&nbsp;&nbsp;2.3 The Bonds shall bear fixed annual (unlinked) interest at a fixed rate of 5.85% (but subject to adjustments
upon a change in the rating of the Bonds (Series B) and/or the Company's failure to comply with the financial covenants set out
in Sections 7.1 and 7.2 below) ()"**Base Interest**" or the "**Annual Interest** "). The Interest shall be
payable in semi-annually installments, on December 31, 2025, and on June 30 and December 31 of the years 2026-2029 (inclusive) and on
June 30, 2030 (each, an "**Interest Payment Date** "), for the six (6) month period commencing on the previous Interest
Payment Date and ending on the day immediately preceding the applicable Interest Payment Date (the "**Interest Period** "),
except for the first Interest Payment Date, which shall take place on December 31, 2025, for the period commencing on the first trading
date after the Public Tender and ending on the day immediately preceding the first Interest Payment Date (the "**First Interest Period**") and which shall be calculated on the basis of 365 days in a year and the actual number of days in such period. The
final interest payment shall be paid on June 30, 2030, together with final Principal payment and against the delivery of the Bond Certificates
to the Company and/or to any third party as instructed by the Company.

&nbsp;&nbsp;&nbsp;&nbsp;2.4 **Record Date** – Payments on account of the Principal and/or any Interest thereon shall be paid
to the relevant Bondholder on the following dates:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4.1. Payments due on December 31 – shall be paid to those holding the Bonds at the end of the Trading
Day on December 19.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4.2. Payments due June 30 (excluding the final payment of Principal and Interest) – shall be paid to
those holding the Bonds at the end of the Trading Day on June 18.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4.3. The final payment of Principal and Interest shall be made against the delivery of the Bond Certificates
to the Company, on the Payment Date, at a location in Israel as the Company shall instruct the Trustee, no later than five (5) Business
Days prior to the final Payment Date.

In the event a certain Payment Date on account of Principal and/or Interest is not a Business Day, the date of such payment shall be postponed to the following Business Day and no interest or other payment shall be due on account of such delay, and the record date for determining the eligibility for redemption or interest shall not be changed as a result of such postponement.

&nbsp;&nbsp;&nbsp;&nbsp;2.5 **Currency Repayment and Linkage** – Other than payments for the fees and expenses as set forth
in this Deed (including those of the Trustee), all payments which the Company is required to make under this Deed, including but not limited
to, repayment of the Principal (whether scheduled, accelerated or upon an early redemption) and Interest payments on the outstanding balance
of the Principal, shall be made to the Bondholders in NIS, linked to Dollar, as follows: (i) if the Payment Rate is higher than the Base
Rate, then such payment in NIS shall be increased proportionately to the rate of increase of the Payment Rate compared to the Base Rate;
(ii) if the Payment Rate is lower than the Base Rate, then such payment in NIS shall be reduced proportionately to the rate of decrease
of the Payment Rate compared to the Base Rate; and (iii) if the Payment Rate is equal to the Base Rate, then such payment shall be made
in the NIS amount originally determined in the Immediate Report on the results of the Offering.

&nbsp;&nbsp;&nbsp;&nbsp;2.6 **Issuance** – The Bonds are being offered initially within the framework of a public offering
in Israel only.

&nbsp;&nbsp;&nbsp;&nbsp;2.7 **Default Interest** – See Section 3.8 of the Terms and Conditions Overleaf.

&nbsp;&nbsp;&nbsp;&nbsp;2.8 **Stock Exchange Listing** – The Company shall List the Bonds on the Stock Exchange.

&nbsp;&nbsp;&nbsp;&nbsp;2.9 **Series Expansion and Issuance of Additional Securities**:

<u>Series Expansion</u> 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.9.1. The Company shall be entitled, from time to time, at its sole discretion, without being required to obtain
approval from the Trustee or the Bondholders, to expand the Bond series and issue additional Bonds (whether by means of a public offering,
private placement or otherwise), the terms and conditions of which will be the same as the terms and conditions of these Bonds initially
issued, at any price and in any manner as the Company deems fit, including at such discount or premium (including without discount or
without premium); this, provided all the following conditions are met: (1) the series expansion of will not lead to the downgrading of
the Bonds' rating, as shall be in effect immediately prior to the expansion date, and prior written confirmation thereof has been
obtained from the Rating Agency, prior to the institutional tender for Classified Investors being held, to if held, including by way of
granting a rating approval for the Bonds to be issued within the framework of the series expansion (in the event more than one Rating
Agency is rating the Bonds, the higher rating shall apply); and (2) a CFO Certificate will be delivered by the Company pursuant to Section
6.1 prior to the expansion date, and no later than the date on which the institutional tender for Classified Investors will be held, if
held, stating that (a) the Company is in compliance with all the Financial Covenants (pursuant to Section 6.1) immediately prior to the
expansion and will be in compliance with all said Financial Covenants on a pro forma basis following the expansion, according to the most
recent Financial Statements published prior to the series expansion and without accounting for any cure or grace period with respect to
said covenant; (b) prior to the expansion, there shall exist no grounds for calling for the immediate repayment of the Bonds, nor shall
there exist any such grounds as a result of the series expansion, without accounting for any cure or grace period with respect to such
grounds; (c) the expansion will not affect the Company's ability to meet its obligations as they come due; and (d) the Company meets all
its material undertakings towards the Bondholders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.9.2. The series expansion shall be subject to obtaining the Stock Exchange's approval to list the additional
Bonds.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.9.3. The Trustee shall serve, subject to the provisions of this Deed of Trust, as Trustee for the Bonds in
circulation from time to time, including those issued within the framework of a series expansion, and the Trustee's consent for
serving as Trustee to the expanded series shall not be required. Bonds in circulation and any additional Bonds that shall be issued in
accordance with this Section 2.9 shall constitute (as of their issuance date) a single series for all intents and purposes, and this Deed
of Trust in respect of the Bonds shall apply also to all additional Bonds of the same series. The Bonds issued within the framework of
a series expansion shall not confer any right to payment of Principal or Interest if the record date for said payment occurred prior to
the issuance date of the additional Bonds. The Trustee shall be entitled to demand an increase in the fees payable thereto, pro rata to
the increase in the amount of Bonds issued (compared to the original issuance), and the Company hereby grants its consent to the increase
in the Trustee's fees as set forth above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.9.4. In the event the discount rate applicable to the Bonds issued within the framework of the series expansion
is different than the discount rate (if any) of the existing Bonds in circulation at such time, the Company shall submit a request to
the Israeli Tax Authority, if necessary, prior to expanding the Bond series, in order to obtain its approval of a uniform discount rate
regarding withholding tax on the discount amount, according to a formula weighting the different discount rates (if any). Should such
approval be obtained, the Company shall calculate, upon the series expansion, the weighted discount rate for all the Bonds, and the Company
shall publish in an Immediate Report together with the results of the Offering prior to the listing of the additional Bonds, the uniform
weighted discount rate and the Stock Exchange Members shall withhold tax at the Payment Dates of said Bonds, according to said discount
rate and the provisions of applicable law. In the event the Company shall fail to obtain the approval, the Company shall publish, prior
to the listing of the additional Bonds, the uniform discount rate, which shall be the highest discount rate determined for the Bonds.
In any event, all the provisions of applicable law pertaining to taxation of discount fees shall apply.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.9.5. The applicable Stock Exchange Members shall withhold tax, pursuant to the applicable Israeli taxation
laws upon payment on account of the Bonds, according to the discount rate the Company has published as aforesaid. Furthermore, the Company
shall withhold tax pursuant to any other tax laws that may apply at said time. Consequently, there may be instances in which tax shall
be withheld for the discount higher than the discount amount determined for the Bonds prior to the series expansion. In such event, a
Bondholder that held Bonds at the eve of the series expansion shall be entitled to submit a request to the Israel Tax Authority in order
to obtain a refund for tax withheld from the discount fees, pursuant to applicable law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.9.6. The Company shall notify the Trustee immediately after the Company's Board of Directors resolves
to expand the Bond series and shall deliver to the Trustee immediately thereafter (on the aforesaid dates), and in any event prior to
the date of the Public Tender for Classified Investors, if the expansion is by way of a public offering that includes a Public Tender
for Classified Investors, and if there is no Public Tender for Classified Investors then prior to the Public Tender: (i) a CFO Certificate
as set forth in Subsection 2.9.1(2) above ; and (ii) the written approval of the Rating Agency as set forth in Subsection 2.9.1(1). The
publishing of the Rating Agency's aforementioned approval or a rating report confirming that the rating of the Bonds shall not be
impacted due to the expansion (including by way of approving a rating for the Bonds to be issued within the framework of the expansion)
shall satisfy the requirement of delivering an approval from the Rating Agency to the Trustee as set forth in this Subsection 2.9.6.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.9.7. For the avoidance of doubt, the Company's undertakings set forth in these Subsections 2.9.1-2.9.6
shall apply only with respect to additional issuances of Bonds by way of expanding the Bonds series issued hereunder, and such undertakings
shall not apply with respect to issuances of Bonds by way of expansion of other series in circulation at such time, or with respect to
new Bond series, or any other debt incurred by the Company, whether said other or new series or said other debt is rated or not, irrespective
of the issuance dates or the dates in which said debt was incurred or to the proximity of such dates to the series expansion date or to
the rating change date.

<u>Issuance of Additional Securities</u> 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.9.8. Notwithstanding the foregoing and subject to the provisions of applicable law, the Company reserves the
right to issue, at any time, and from time to time (by means of a private placement or prospectus or shelf offering report or otherwise),
additional series of bonds or other debt securities of any kind or type, without being required to obtain the approval of the Trustee
and/or the Bondholders existing at such time, and on such terms and conditions as shall deem fit, including with respect to payment terms,
interest and collaterals; all without derogating from the repayment undertakings imposed on the Company by virtue of this Deed, provided
only that any new bond series or any other securities that constitute debt which are issued without collateral shall not have any priority
over the Bonds (Series B upon liquidation; and that the bonds or other securities that constitute debt and are secured by any collateral
will be have priority only in respect to the collateral by which said bonds or securities have been secured. The Company will provide
the Trustee with a CFO certificate confirming that said condition is met prior to the issuance of the other bond series or other debt
securities as aforesaid.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.9.9. The foregoing shall by no means derogate from any of the Trustee's rights and the Bondholders'
rights under this Deed of Trust, including from their right to call for an immediate repayment of the Bonds pursuant to the provisions
of this Deed of Trust.

&nbsp;&nbsp;&nbsp;&nbsp;2.10 The provisions of this Deed of Trust shall apply to the Bonds issued under this Deed and which shall be
held from time to time by any purchaser of the Bonds, unless otherwise explicitly provided herein. Each Bond, whether issued on the Issuance
Date or as a result of an Bond series expansion of, will have equal rights compared to any other Bond in the series (*pari passu)* without
any such Bond having priority Notwithstanding the aforesaid, Section 52N1 of the Securities Law will apply.

&nbsp;&nbsp;&nbsp;&nbsp;2.11 This Deed of Trust shall enter into effect upon the initial issuance of the Bonds and shall apply as of
the Issuance Date. It is hereby agreed that in the event the Offering is cancelled for any reason whatsoever, this Deed of Trust shall
be null void *ab initio*.

3.  **<u>Appointing the Trustee and the Duties Thereof</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;3.1 The Company hereby appoints the Trustee to serve solely as Trustee to the Bondholders by virtue of the
provisions of Section 35B of the Securities Law.

&nbsp;&nbsp;&nbsp;&nbsp;3.2 The Trustee shall be a trustee to the Bondholders by virtue of the provisions of Chapter E1 of the Securities
Law, including for those entitled to payments by virtue of the Bonds that were not paid when due.

&nbsp;&nbsp;&nbsp;&nbsp;3.3 Upon the Deed of Trust entering into effect, as is set forth in Section 2.11 of this Deed, the duties
of the Trustee shall be in accordance with applicable law and the provisions of the Deed.

&nbsp;&nbsp;&nbsp;&nbsp;3.4 In the event the Trustee is replaced by another Trustee, such other Trustee shall act as trustee for the
Bondholders, including for those persons entitled to payments by virtue of the Bonds that were not paid when due.

&nbsp;&nbsp;&nbsp;&nbsp;3.5 The Trustee is not required to act in any manner not explicitly set forth in this Deed of Trust in order
to obtain any information, including information regarding the Company or its business or its ability to meet its obligations towards
the Bondholders and such action is not included among its duties.

4.  **<u>Powers of the Trustee</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;4.1 The Trustee shall use the powers, permissions and authorities conferred thereupon under law and under
this Deed of Trust, at its sole discretion, or in accordance with a resolution passed at a Bondholders' Meeting; all, subject to
the provisions of applicable law which are non-contingent. The Trustee shall not be liable for any damage that may be caused as a result
of an error in such discretion, unless the Trustee acted in bad faith or with gross negligence (unless exempt by law), willful misconduct
or malicious intent.

&nbsp;&nbsp;&nbsp;&nbsp;4.2 The Trustee shall be entitled to deposit any deeds and other documents which evidence, represent and/or
stipulate its rights with respect to the trusteeship subject matter of this Deed of Trust, including with respect to any asset that is
in its possession at such time, in a safe deposit box and/or at another place it may select, including at any bank, with an attorney and/or
with an accountant. The Trustee shall not be liable for any loss that may be incurred in connection with a deposit made in accordance
with this Section 4.2, unless the Trustee acted in bad faith or in gross negligence (unless exempt by law), willful misconduct or with
malicious intent.

&nbsp;&nbsp;&nbsp;&nbsp;4.3 The Trustee shall represent the Bondholders with respect to any matter deriving from the Company's
undertakings towards them, and for such purpose it shall be entitled to take action in order to exercise the rights conferred to the Bondholders
by law or according to this Deed of Trust.

&nbsp;&nbsp;&nbsp;&nbsp;4.4 The Trustee may initiate any proceeding to protect the Bondholders' rights according to applicable
law and the provisions set forth in this Deed of Trust.

&nbsp;&nbsp;&nbsp;&nbsp;4.5 The Trustee shall be entitled to appoint agents as set forth in Section 22 to this Deed.

&nbsp;&nbsp;&nbsp;&nbsp;4.6 The Trustee's actions shall be valid even if a defect is discovered in its appointment or qualifications.

&nbsp;&nbsp;&nbsp;&nbsp;4.7 The Trustee's execution of this Deed of Trust does not constitute an opinion on its part with respect
to the quality of the Bonds or with respect to the advisability of investing therein.

&nbsp;&nbsp;&nbsp;&nbsp;4.8 The Trustee shall not be obliged to notify any party with respect to the execution of this Deed of Trust.
The Trustee shall not interfere and shall not be entitled to interfere in any way in the management of the Company's business or
its affairs, and no action or inaction by the Company shall require its approval, and these matters shall not form part of its duties.
This Section shall not prevent the Trustee from taking any action which it is required to take under the provisions of this Deed or applicable
law.

&nbsp;&nbsp;&nbsp;&nbsp;4.9 Within the framework of its trusteeship, the Trustee may rely on any written document including letter
of instructions, notice, request, consent or approval, appearing to be executed or prepared by any Person or entity, which the Trustee
believes in good faith that it had been executed or prepared thereby.

&nbsp;&nbsp;&nbsp;&nbsp;4.10 It is clarified that termination of the Trustee's term of office shall not derogate from the Company's
and/or the Bondholders' rights, claims or demands towards the Trustee, if any, insofar as their grounds precede the termination
of the Trustee's term in office, and the Trustee shall not be released from any liability in accordance with applicable law. In
addition, the termination of the Trustee's term in office shall not derogate from the Trustee's rights, claims or demands
of towards the Company and/or the Bondholders, if any, in so far as their grounds precede the termination of the Trustee's term
in office, and the Company and/or Bondholders shall not be released from any liability in accordance with applicable law.

5.  **<u>Repurchase of Bonds by the Company</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1 The Company reserves, subject to any law, the right to repurchase all the Bonds, or a portion thereof,
at any time and from time to time, without derogating from the repayment undertakings of the Bonds in circulation. The Company will file
an Immediate Report regarding the repurchase if and to the extent it is required to do so by applicable law. If no Immediate Report is
filed, the in the event of such repurchase, the Company shall inform the Trustee thereof in writing.

In the event of a repurchase as aforesaid, the purchased Bonds shall automatically expire and be cancelled and delisted from trade, and the Company shall not be entitled to reissue them.

In the event that the Bonds are repurchased by the Company in the framework of trading on the Stock Exchange, the Company will apply to the Clearing House to withdraw the certificates so purchased, unless otherwise stipulated by the legal provisions as these may be at such time. If according to the legal provisions at such time, the Bonds are neither cancelled nor delisted from trade on the Stock Exchange, the Company will be entitled to sell the Bonds, all or part thereof, at its sole discretion, in accordance with the provisions of the law as these will be at such time, without obtaining the consent of the Trustee and/or the Bondholders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2 The foregoing shall not derogate from the Company's right to repay the Bonds by way of an early
redemption as is set forth in Section 9 below.

Any subsidiary of the Company and/or a corporation controlled thereby and/or its Associate (*i.e*., as defined in the Securities Regulations (Periodic and Immediate Reports), 5730-1970) and/or an Affiliate of the Company and/or a Controlling Shareholder of the Company (directly and/or indirectly) and/or any family member thereof (namely, spouse, sibling, parent, parent's parent, descendant or descendant of the spouse, or spouse of any of the above), and/or any corporation controlled thereby (directly or indirectly) (other than the Company itself (to which the provisions of this Section 5.1 above shall apply)) (each, an "**Related Holder**"), may purchase and/or sell at any time and from time to time on or off the Stock Exchange, including by way of the Company's issuance of Bonds to be issued pursuant to the Deed of Trust. In the event of a purchase or sale as aforesaid by a Subsidiary of the Company and/or any corporation controlled thereby, or in the event the Company becomes aware of a purchase or sale by any other Related Holder, the Company shall notify the Trustee thereof. The Bonds held as aforesaid by a Related Holder shall be deemed an asset of the applicable Related Holder and, if listed, shall not be delisted from the Stock Exchange and shall be transferable as the other Bonds. Bonds owned by a Related Holder shall not confer to the Related Holder voting rights at any Bondholders' Meeting and shall not be counted for purposes of determining whether a legal quorum is present as required for convening such a meeting. Bondholders' Meetings shall be held in accordance with the provisions of the Second Schedule to the Deed of Trust. A Related Holder shall report to the Company, to the extent that it is required by law to do so, regarding the purchase of Bonds thereby and the Company shall provide the Trustee, upon its demand, the list of Related Holders and the amounts held thereby on the date requested by the Trustee and this according to said reports received from Related Holders. For the purpose of this Section, an Immediate Report published on the MAGNA filing system or the Maya website, to the extent the Company ceases to be a reporting corporation, shall constitute a report to the Trustee for the purposes of this Section.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3 Nothing in this Section above shall in itself obligate the Company or any Related Holder or the Bondholders
to purchase and/or sell any Bonds held thereby.

6.  **<u>Covenants of the Company</u>** 

The Company undertakes towards the Bondholders to pay all Principal and Interest, including any Default Interest in accordance with Section 2.7 above, and Interest applicable in the event of a decrease in rating and/or breach of a Financial Covenant (as defined below) (all as applicable and pursuant to the provisions of this Deed), as well as any linkage differentials, payable to the Bondholders in accordance with the terms of the Bonds and to meet all other terms and obligations imposed on it under the Bonds and this Deed of Trust.<sup>2</sup>

In addition, during the term of the Bonds, the Company shall (unless the Bondholders by way of a Special Resolution according to the provisions of this Deed have agreed otherwise) comply with the following covenants:

&nbsp;&nbsp;&nbsp;&nbsp;6.1  **<u>Financial Covenants</u>** :

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.1 **The ratio of Net Financial Debt to NOI shall not exceed 12.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.2 **The ratio of Net Financial Debt to Net CAP net shall not exceed 63%** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.3 **The ratio of Net Financial debt to EBITDA shall not exceed 13.** 

<u>For the purposes of this section</u>:

"**NOI**" - as the term Community NOI is defined in the Company's quarterly Financial Statements.

"**Net Debt**" - short-term and long-term interest-bearing debt from banks and other financial creditors plus interest-bearing debt to Bondholders for the Bonds issued by the Company, less cash and cash equivalents, as well as short-term investments, marketable securities, and deposits, all based on the Company's most recent Financial Statements. It is clarified that the Net Financial Debt figure appearing in the Company's Financial Statements does not include restricted cash and deposits.

"**Net CAP**" - Total Shareholders' Equity (including minority interest(plus Accumulated Depreciation plus Net Financial Debt, all according to the Company's most recent Financial Statements,

**"EBIDTA"** - net profit/loss plus interest, taxes, depreciation, amortization, profit and loss from the change in fair value of securities as well as the profit or loss from the sale of securities, calculated according to the four quarters ended at the date of the applicable Financial Statements, all in accordance with the Company's Financial Statements.

<sup>2</sup> The Company confirms that it is not subject to restrictions on dividend distributions, except for restrictions under applicable law.

The Company's compliance with each of the financial covenants set forth in Subsections 6.1.1 through 6.1.3 (hereinafter: the "**Financial Covenants**") shall be measured upon the publishing of the Financial Statements for each of the Company's fiscal quarters. The Company shall provide the Trustee, within five (5) Business Days from the date of the publishing of each of the Company's Financial Statements, a CFO Certificate with respect to the Company's compliance with each of the Financial Covenants, together with an electronic spreadsheet showing the manner of their calculation. Additionally, the Company will state in the notes to its Financial Statements its compliance with the Financial Covenants.

The terms employed with respect to the Financial Covenants shall be calculated and determined in accordance with U.S. GAAP as in effect as of the date hereof. In the event of a change in U.S. GAAP subsequent to the date hereof that affects the calculation of any of the Financial Covenants, the Financial Covenants will continue to be calculated in accordance with U.S. GAAP rules existing on the date in which this Deed was executed and the CFO Certificate shall include a brief description of such change.

&nbsp;&nbsp;&nbsp;&nbsp;6.2  **<u>Negative pledge</u>** :

The Company shall not create a general floating charge (or an equivalent thereof under the law applicable to the Company) on all its direct assets in favor of any third party whatsoever in order to secure its undertakings towards said third party, unless it obtained the prior consent of the Bondholders by way of a Special Resolution, or unless it grants, concurrently with granting said general floating charge on all the Company's direct assets and rights as aforesaid in favor of a third party, a floating charge in favor of the Bondholders, and these charges shall be *pari passu* according to the ratio of the Company's debts to each of the parties. If any such charge is created, it shall be created while coordinating with the Trustee and in a form satisfactory thereto, alongside the provision of Officer Certificates and an Opinion with respect to the creation of said charge and it being valid and enforceable, all pursuant to applicable law. It is clarified that the Trustee will be entitled to appoint an attorney versed in the law applicable to said charge, and the Company will bear all of its costs.

For the avoidance of doubt, the foregoing shall not restrict (1) the Company from creating fixed charges on all or any of its assets, (2) the Company from creating floating charges on one or more specific assets or (3) the ability of corporations controlled by the Company to create any type of charge (whether fixed or floating) on any (including all or most) of their assets, in each case without any restriction or to guarantee the Company's undertakings.

For the avoidance of doubt, the Trustee is not responsible for examining the possibility and/or the need for registering negative pledges or any registration corresponding thereto in its nature and essence outside of Israel. The Company's declarations in this regard will be adequate with respect to the registration of the charges.

The Company hereby represents and warrants that as at the date of this Deed of Trust it has neither created nor registered floating charges on all its direct assets and rights in respect of which the aforementioned undertaking has been granted, and that under the law applicable to the Company, there is no need to register an undertaking for a negative charge as aforesaid in any registry (external or internal).

&nbsp;&nbsp;&nbsp;&nbsp;6.3  **<u>The Rating of the Bonds</u>** 

The Company undertakes to act, insofar that it falls under its control, and as long as the Principal has yet to be repaid in full, to ensure that the Bonds will be rated by a Rating Agency, and accordingly the Company undertakes, *inter alia*, to pay the Rating Agency and provide it with all the information it shall require, including the reports required thereby within the framework of the Company's engagement with the Rating Agency. In this regard, failing to make payments or in providing the information required by the Rating Agency within the framework of the Company's engagement with the Rating Agency shall be deemed, *inter alia*, as reasons and circumstances that are under the Company's control. For the avoidance of doubt, it is clarified that the placing the of the Bonds under a watch list or any similar action taken by the Rating Agency will not be considered as a rating termination.

The Company does not undertake to replace the Rating Agency nor that it shall not terminate its engagement therewith throughout the term of the Bonds. In the event that the Company replaces the Rating Agency and/or terminates engagement therewith, including in the event that the Bonds are rated by more than one Rating Agency, the Company undertakes to publish an Immediate Report regarding the termination and/or substitution of the Rating Agency, as well as to notify the Trustee of the circumstances that led to the replacement of the Rating Agency or the termination of the engagement, as the case may be, within two (2) Business Days of the earlier of (a) the replacement (b) the date in which the decision to terminate the engagement with the Rating Agency was made. The Company will also provide the Trustee a document comparing the rating scale of the exiting Rating Agency to those of the new Rating Agency.

It is hereby clarified that the aforementioned provisions shall not derogate from the Company's right to replace a Rating Agency at any time or terminate the engagement with a Rating Agency (in the event it is not the only Rating Agency) at its sole discretion and for any reason it deems fit and without the Trustee and/or the Bondholders having any claim in such respect (without derogating from the provisions of Section 10.1.13 below).

&nbsp;&nbsp;&nbsp;&nbsp;6.4  **<u>Cross Default</u>** :

Throughout the period in which there exists any Cross Default, at the request of any Bondholder, the Company, to the extent that it is not prevented or restricted under law from doing so, including under the provisions of any relevant credit facility, shall provide to said Bondholder any report or other information that is provided to any lender or other financing source under the credit facility causing the Cross Default. The receipt of such report or other information shall be contingent upon said Bondholder consenting not to divulge the report or information to any third party nor to purchase nor sell any of the Company's securities based on any material, nonpublic information included in such report or other information.

It should be emphasized that without derogating from the aforesaid in this Section, to the extent a Cross Default exists, the Company will notify by way of an Immediate Report the occurrence of a Cross Default and the reasons therefor, and will provide the Trustee with all documents and information described in the beginning of this Section, and the Trustee shall be entitled to provide said information to the Bondholders in a Bondholders' Meeting or by way of a report, without the Trustee having any duty of confidentiality.

&nbsp;&nbsp;&nbsp;&nbsp;6.5  **<u>Appointing a Representative in Israel for the Company</u>** 

Until after the full, final and accurate repayment of the Bonds under the terms of the Deed of Trust to the Bondholders, the Company undertakes that it will have a representative on its behalf in Israel, to whom it will be possible to serve court documents concerning the Company and its Officers with respect to all matters pertaining to this Deed of Trust, *in lieu* of them being served at the Company's address abroad as set forth in the preamble to this Deed.

As of the execution date of the Deed, the Company's representative in Israel is Goldfarb Gross Seligman & Co. Law Office (the address of which is specified in the preamble to this Deed) (the "**Company's Representative in Israel**"). Service upon the Company's Representative in Israel shall be considered valid and binding with respect to any claim and/or demand made by the Trustee and/or the Bondholders pursuant to this Deed of Trust. The Company may change the identity of the Company's Representative in Israel from time to time, provided that upon its replacement, the Company shall file an Immediate Report containing the details of the Company's new Representative in Israel no later than one Trading Day following the date on which the Company resolved to appoint another representative and deliver a notice thereof to the Trustee. If a new representative is appointed, the Immediate Report and the notice to the Trustee shall include also the date on which the appointment of the new representative entered into effect. For so long as the appointment of the new representative has not taken effect, the address of the substituted representative shall be the address for service. For the avoidance of doubt, it should be emphasized that for as long as the Company Representative in Israel resigns from its position (the "**Resigning Representative**"), for so long as there is no replacement who actually serves in that position, the Resigning Representative's address will be the address of the service.

&nbsp;&nbsp;&nbsp;&nbsp;6.6  **<u>Controlling Shareholder Transactions</u>** :

The Company clarifies that as of the execution date of this Deed, various securities of the Company are listed with the Securities and Exchange Commission (SEC) pursuant the U.S. Securities Exchange Act of 1934 (the "**Exchange Act**"). Various of the Company's securities are listed under the Exchange Act and listed for trade on the New York Stock Exchange ("**NYSE**"). Consequently, the Company is subject to the laws and regulations applicable to public companies in the U.S. under the securities laws, rules and regulations of the NYSE governing listed companies.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.7  **<u>Expense Cushion</u>** 

Without derogating from the provisions of Section 23 to the Deed of Trust, out of the net Offering proceeds, the Company shall instruct the Offering coordinator to deposit to with the Trustee, simultaneously with the transfer of the Offering proceeds balance to the Company, an amount equal to $300,000 (according to the Representative Rate known on the first Trading Day after the Public Tender date) to be used for the payment of ongoing expenses and administrative expenses reasonably incurred by the Trustee with respect to the calling for the immediate repayment of the Bonds pursuant to the provisions of Section 10 or with the Company breaching the provisions set forth herein, reasonably incurred in order to preserve the Bondholders' rights (the "**Prepaid Expenses**"). It is clarified that the actual expenses will be borne by the Company whilst the Trustee will deposit said funds in a bank account opened thereby in its name in trust for the Bondholders only and which will shall serve to secure these payments. The Trustee shall be entitled to make use of said funds for the purposes set forth above, at its discretion, while acting reasonably, if the Company has failed to pay said expenses. Should the Trustee use the said funds as set aforesaid, the Company shall pay the Trustee, within 14 Business Days from the date on which the Company received from the Trustee a written demand for such payment, additional amounts so that the Trustee will have in such account Prepaid Expenses in the amount of $300,000. The Prepaid Expenses shall be held by the Trustee as aforesaid until the full and final repayment of the Bonds (insofar as they are not used as specified above). Following the full and final repayment of the Bonds, the balance, if any, of the Prepaid Expenses will be transferred (together with all proceeds accrued thereon), inasmuch as it has not been used, to the Company in accordance with details to be provided by the Company to the Trustee in writing and in advance.

In the event that the aforesaid funds are not sufficient to cover the Trustee's expenses with respect to the calling for the immediate repayment of the Bonds and/or to the Company breaching the provisions of the Deed of Trust as aforesaid, the Trustee shall act pursuant to the provisions of Section 23 below.

For the avoidance of doubt, it is hereby clarified that the account in which the Prepaid Expenses are deposited will be managed solely by the Trustee, which will have sole signatory rights therein. The Prepaid Expenses will be invested in Permitted Investments (as defined in Section 13 below). The Trustee will not be liable towards the Bondholders and/or the Company for any loss that will be incurred due to these investments.

The Trustee will provide the Company, upon its written request, information on the manner in which the Prepaid Expenses are invested as well as of their balance. The Company shall bear all costs associated with the opening, management and closing of said account.

It is clarified that the amounts of the Prepaid Expenses paid by the Company as aforesaid in this Section shall be deemed amounts the Company will be required under any law, in as much as it will be required, to deposit with the Trustee, to the extent legal provisions applicable to the Company in this context will enter into effect.

&nbsp;&nbsp;&nbsp;&nbsp;6.8  **<u>Restrictions on Distribution</u>** 

For long as the Company does not breach any of the Financial Covenants set forth in Section 6.1 above, no distribution restriction will apply to the Company. If the Company deviates from one or more of the Financial Covenants set forth in section 6.1 above, the Company shall be allowed to make a distribution in an amount that does not exceed the amount required to meet the requirements of U.S. law applicable to REITs. If the Company ceases to be a REIT in the United States, then the Company may distribute dividends provided that it is not in breach of one or more of the covenants detailed in Sections 7.2.1(a)-(c) below.

In the event of a distribution while the Company is in breach of one or more of the Covenants set forth above, the Company shall provide the Trustee, in advance, notice of its intent to pursue a distribution together with a confirmation from the Company's Chief Financial Officer that the amount to be distributed does not exceed the amount required to meet the requirements of U.S. law applicable to REITs.

7.  **<u>Interest Rate Adjustments</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1 **Mechanism for Interest Rate Adjustment due to a Change in Rating** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1.1 In the event the Base Rating of the Bonds is downgraded during any Interest Period (the **"Downgraded Rating"**), the interest rate on the outstanding Principal balance shall be increased by 0.50% per annum (in addition to the Base
Interest) against a downgrade of two "notches" (i.e., a double downgrade) from the Base Rating and by an additional 0.25% for
each further downgrade, up to a maximum additional interest rate of one and a quarter percent (1 **.** 25%) per annum, for the period
commencing on the date on which the applicable Downgraded Rating was published by the relevant Rating Agency and until the earlier of
(i) the full repayment of the Principal and (ii) the date on which the applicable Rating Agency subsequently upgrades the Bond rating
to a rating higher than the Downgraded Rating (such rating, the **"Updated Rating").** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1.2 It is hereby clarified that the maximum increase of the Base Interest pursuant to this Section 7.1 shall
not exceed 1.25% per annum.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1.3 No later than two (2) Business Days following the receipt of the Rating Agency's notice regarding
the downgrading of the Bonds to the Downgraded Rating, the Company shall publish in an Immediate Report the following: (A) the fact that
the rating was downgraded, the Downgraded Rating and the date in which the Downgraded Rating entered into effect (the "**Rating Downgrade Date** "); (B) the interest rate that the Principal shall bear for the period commencing on the first day of the then-current
Interest Period and until the Rating Downgrade Date (calculated on the basis of 365 days in a year and the actual number of days in such
period) (in this Section 7.1.3 the "**Original Interest** "); (C) the interest rate the Principal on the Bonds shall bear
commencing on the Rating Downgrade Date and until the following Interest Payment Date (assuming no other events affecting such interest
rate shall occur and calculated on the basis of 365 days in a year and the actual number of days in such period); (D) the weighted interest
rate to be paid by the Company to the Bondholders on the next Interest Payment Date, deriving from the interest payments described in
clauses (B) and (C) above; (E) the annual interest rate reflected from the weighted interest rate; and (F) the updated annual interest
rate and the semi-annual interest rate for the period commencing on the next Interest Payment Date (*i.e*., the period commencing
immediately following the period during which the Rating Downgrade Date occurred).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1.4 If the Rating Downgrade Date occurs within the four (4) days preceding the record date for a given interest
payment and ending on the Interest Payment Date closest to such record date (in this Subsection 7.1.4, the "**Deferral Period** "),
the Company shall pay the Original Interest to the Bondholders on such Interest Payment Date, and the amount of interest deriving from
the additional interest at a rate equal to the additional interest rate per annum for the Deferral Period (calculated on the basis of
365 days in a year and the actual number of days in such period) shall be paid on the following Interest Payment Date. The Company shall
Publish an Immediate Report detailing the additional interest amount to be paid on the following Interest Payment Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1.5 It is hereby clarified that if following a downgrade which has affected the Base Interest, the Rating
Agency shall issue an Upgraded Rating whereby the rating of the Bonds has increased, the interest rate on the Bonds will be reduced in
accordance with the interest rate increase steps applicable to downgrading as specified in Section 7.1.1 above, until a total maximum
decrease in the interest rate of one percent (1%) per annum (i.e., whereby the increase in rating to the Base Rating shall reinstate the
Base Interest on the outstanding Principal balance, without any additional interest, subject to changes pursuant to Section 7.2), and
until the full repayment of the unpaid Principal balance or until a change in the rating of the Bonds in accordance with and subject to
the provisions of this Section 7.1 In such case, the Company shall act pursuant to the provisions of Sections 7.1.3 and 7.1.4 above, with
requisite changes deriving from the fact that the Deviation no longer exists. It is clarified that if the rating of the Bonds exceeds
the Base Rating, this shall have no effect on the interest rate borne by the Bonds at that time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1.6 In the event the Bonds cease to be rated for reasons attributable to the Company (*e.g*., due to
the Company's failure to meet its obligations towards the Rating Agency, including its failure to comply with its payment and/or
reporting obligations to the Rating Agency) for a period exceeding twenty-one (21) consecutive days, commencing on the date of such rating
cessation and until the earlier of: (1) full and final repayment of the Bonds in accordance with the provisions of this Deed; or (2) the
date on which the Bonds are once more rated, additional interest shall be paid at a rate of 1.25% per annum (calculated on the basis 365
days in a year and the actual number of days in such period), including upon the Bondholders' calling for the immediate repayment
of the Bonds pursuant to the provisions of Section 10.1. For the avoidance of doubt, it is hereby clarified that (1) in the event the
Bonds cease to be rated for reasons not attributable to the Company, the interest rate on the Bonds shall not be changed and the provisions
of this Section 7.1.6 shall not apply; and (2) in the event the Bonds are rated by more than one Rating Agency, the interest rate adjustment
pursuant to this Section 7.1.6 shall not apply for as long as the Bonds are rated by at least one Rating Agency.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1.7 In the event the Bonds cease to be rated by a Rating Agency, the Company shall Publish an Immediate Report
as to the circumstances associated with such cessation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1.8 In the event the Bonds are rated by more than one Rating Agency, the lower rating shall be deemed to be
the applicable rating for the Bonds, as updated from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1.9 Any change in the rating outlook of the Bonds and/or any rating downgrade or upgrade due only to a change
in the methodology or rating scales of the applicable Rating Agency, shall not be deemed a change in the rating and shall not have any
impact on (including by way of increase and/or decrease) the interest rate applicable the Principal.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1.10 Notwithstanding the foregoing, in the event of a downgrade or cessation of rating which entitled the Bondholders
to additional interest under Section 7.1 above and a deviation entitling the Bondholders to additional interest under Section 7.2 below,
the maximum additional aggregate interest that may be received by the Bondholders shall not exceed the rate of 1.5% per annum.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2 **Mechanism for Interest Rate Adjustments Resulting from the Company failing to comply with Financial Covenants** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2.1 In the event the Company fails to comply with whichever of the Financial Covenants (each non-compliance
event shall be referred to hereafter as a "**Deviation** "), as described below:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(A)** **The ratio of Net Financial Debt to NOI shall not exceed 10.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(B)** **The ratio of Net Financial Debt to Net CAP shall not exceed 60%.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(C)** **The ratio of Net Debt to EBITDA shall not exceed 12.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(D)** **If the Company ceases to maintain its REIT status in the U.S. for more than 90 days.** 

The annual interest rate on the outstanding Principal balance shall be increased by a 0.25% per annum for each of the foregoing Financial Covenants with respect to which there exists a Deviation, for the period commencing: with respect to Subsections A through C, on the date of the Company's Publishing of its Financial Statements according to which a Deviation has occurred; and with respect to Subsection D, upon the Company's Publishing a report whereby it ceased to hold REIT status in the U.S. (the "**Deviation Date**"), and until the earlier of: (1) repayment of the Company's liabilities in accordance with the provisions of this Deed; or (2) with respect to Subsections A through C above – the Company's Publishing of Financial Statements (and a CFO Certificate to be provided by Company to the Trustee) in which such Deviation is shown to have been cured, and with respect to Subsection D above – the Company's Publishing a report whereby it resumed to hold REIT status in the U.S. The maximum increase in Base Interest pursuant to this Section 7.2.1 shall not exceed one-half percent (0.5%) per annum.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2.2 The Company shall provide the Trustee, no later than one (1) Business Day of the Deviation Date, a notice
containing information with respect thereto and shall Publish in an Immediate Report the following information: (A) details regarding
the non-compliance with the Financial Covenants; (B) the precise interest rate to be borne on the Principal for the period commencing
on the first day of the then-current Interest Period and until the Deviation Date (calculated on the basis of 365 days in a year and the
actual number of days in such period) (in this Section 7.2.2, the "**Original Interest** "); (C) the interest rate to be
borne on the Principal commencing on the Deviation Date and until the following Interest Payment Date (assuming no other events affecting
such interest shall occur and calculated on the basis of 365 days in a year and the actual number of days in such period); (D) the weighted
interest rate to be paid by the Company to the Bondholders on the next Interest Payment Date, deriving from the interest payments described
in clauses (B) and (C) above; (E) the annual interest rate reflected from the weighted interest rate; and (F) the updated annual interest
rate and the semi-annual interest rate for the period commencing on the next Interest Payment Date (*i.e.*, the period commencing
immediately following the period during which the Deviation occurred).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2.3 In the event a Deviation occurs within the four (4) days preceding the record date for a given Interest
Payment and ending on the Interest Payment Date closest to such record date (in this Subsection 7.2.3, the "**Deferral Period** "),
the Company shall pay the Bondholders, on such Interest Payment Date, the Original Interest, and the amount of interest deriving from
the additional interest at a rate equal to the additional interest rate per annum for the Deferral Period (calculated toon the basis of
365 days in a year and the actual number of days in such period) shall be paid on the following Interest Payment Date. The Company shall
announce by way of Immediate Report the additional interest amount that shall be paid on said following Interest Payment Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2.4 In the event that after the occurrence of a Deviation in a manner affecting the Base Interest with respect
to Subsections A through C above, the Company will Publish its Financial Statements and shall provide a CFO Certificate pursuant to the
provisions set forth in Section 6.1 whereby the Deviation is shown to have been cured, and with respect to Subsection D above - the Publishing
of a report whereby the Company resumed its REIT status in the U.S.; then the Interest rate shall be decreased by 0.25% per annum for
each Financial Covenant cured up to a total maximum decrease of 1.5% per annum, provided that at that time there is no Deviation from
at least two additional Financial Covenants (namely, if all Deviations have been cured, the Base Interest on the outstanding Principal
balance of the on the Bonds will be reinstated, without any additional interest, subject to changes deriving from the provisions ser forth
in Section 7.1 above); this, for a period commencing on the date of Publishing the Financial Statements which evidence the termination
of the Deviation as aforesaid and until the earlier of the full repayment of the outstanding Principal balance or until the creation of
an additional Deviation (the interest rate shall be calculated for any partial interest period on the basis of 365 days in a year and
the actual number of days in such period). In such instance, the Company shall act pursuant to the provisions of Sections 7.2.2 and 7.2.3
above, with requisite changes deriving from the fact that the Deviation no longer exists.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3 Notwithstanding the foregoing, in the event of a downgrade or the cessation of rating entitling the Bondholders
to additional interest pursuant to Section 7.1 above and a Deviation entitling the Bondholders to additional interest pursuant to Section
7.2 above, the maximum aggregate additional interest which will be received by the Bondholders shall not exceed a rate of 1.5% per annum.

8.  **<u>Security and Seniority of the Bonds</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1 The Bonds are not secured by any collateral and are classified by the Company as unsecured bonds.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2 The Trustee has not examined, nor shall it be under any obligation to examine, the need to grant collateral
in order to secure the payments to the Bondholders. The Trustee was neither asked to conduct nor did it *de facto* conduct nor will
it conduct, due diligence (economic, accounting or legal) regarding the state of the Company's business or that of its Subsidiaries. By
entering into this Deed of Trust, including by its consenting to serve as Trustee to the Bondholders, the Trustee is not expressing any
opinion whatsoever, whether explicitly or implicitly, with respect to the Company's ability to meet its obligations towards the
Bondholders. The foregoing shall by no means derogate from the Trustee's duties of the under applicable law and/or this under Deed
of Trust.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3 All of the Bonds shall be ranked *pari passu* with amongst themselves with respect of the Company's
obligations under the Bonds, without any Bond having a preferred rights or priority over the other, and together they shall rank *pari passu* with the Company's other unsecured obligations, except for obligations assigned priority by virtue of applicable law.
The Bonds shall be senior to any of the Company's subordinated obligations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.4 Subject to the provisions of Section 6.4 above and without derogating from the provisions of Section 10
hereunder, the Company shall be entitled, from time to time, at its sole and absolute discretion, to sell, pledge, lease, assign, deliver
or otherwise transfer, all, most or some of its assets, in any way whatsoever, without obtaining the consent of the Trustee and/or that
of the Bondholders. It is hereby clarified that no restriction shall apply to the Company with respect to it providing guarantees in favor
of another (or others), including to corporations held thereby, directly or indirectly, and subject to the provisions of Section 2.9.8
above, the Company shall not be prevented from receiving any new credit.

9.  **<u>Early Redemption</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;9.1 <u>Early Redemption Initiated by the Company</u> 

The Company may, at any time but not before 60 days have elapsed from the listing of the Bonds (Series B), at its sole discretion, effect a full or partial early redemption, in the manner set forth below, subject to the directives of the Israel Securities Authority and to the Stock Exchange Guidelines, as shall be in effect at the relevant date. Any redemption notice may, at the Company's discretion, be subject to one or more conditions precedent, including completion of a refinancing transaction or other corporate transaction:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1.1 The frequency of the early redemptions shall not exceed one early redemption per quarter. In the event
that a partial early redemption is scheduled for a quarter in which an interest payment date, a partial redemption date or a final redemption
date is also due, the partial early redemption shall be effected on the date prescribed for said payment. For purposes hereof, a "**Quarter** "
shall mean any of the following periods: January through March, April through June, July through September, or October through December.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1.2 The minimum amount of any early redemption shall not be less than NIS 1 million. Notwithstanding the aforementioned,
the Company may effect an early redemption in an amount lower than NIS 1 million, provided that the frequency of the redemptions shall
not exceed one early redemption per year. If a partial early redemption is effected, the final redemption amount shall not be less than
three million two hundred thousand NIS (NIS 3,200,000). Any amount paid by the Company by way of an early redemption shall be paid with
respect to all Bondholders, *pro rata* to the par value of the Bonds held thereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1.3 Upon the Company's resolution to carry out an early redemption, and in any event no less than seventeen
(17) days and not more than forty five (45) days prior to the record date of the early redemption (the "**Early Redemption Date** "),
the Company shall Publish an Immediate Report about the execution of the early redemption.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1.4 The Early Redemption Date shall not occur during the period between the record date for the payment of
Interest and the *de facto* interest payment date. In the aforesaid Immediate Report, the Company shall set forth the amount of Bonds
(expressed as the Principal amount) to be paid by way of early redemption as well as the interest accrued on said Principal amount until
the Early Redemption Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1.5 Upon a partial Early Redemption Date, if any, the Company shall Publish an Immediate Report which shall
contain the following information: (1) the partial redemption percentage in terms of the outstanding balance of the Bonds, prior to the
redemption; (2) the partial redemption expressed as a percentage of the par value of the Bonds at the original Issuance Date; (3) the
interest rate on the Principal portion to be redeemed; (4) the interest to be paid, calculated with respect to the outstanding balance;
(5) an update regarding the remaining partial redemption rates in terms of the original series (*i.e*., applying the original amortization
schedule to the remaining outstanding balance of the Bonds, following the partial early redemption entering into effect); (6) the record
date for the right to receive the early redemption of the Principal, which shall be twelve (12) days prior to the Early Redemption Date.
A partial early redemption will be effected *pari passu* with respect to each of the Bondholders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1.6 In the event of a partial early redemption, if any, the Company shall pay the Bondholders the interest
accrued until the Early Redemption Date only with respect to the portion of the Principal being redeemed by way of the early redemption
rather than with respect to the total outstanding balance of the Bonds, all, as part of the early partial redemption amount to be determined
in accordance with Section 9.1.7 below.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1.7 The amount that shall be paid to the Bondholders in the case of an early redemption shall be the higher
of the following: (1) the liability value of the Bonds in circulation to be redeemed, *i.e.*, the Principal plus accrued interest
and any linkage differentials payable on the Early Redemption Date; (2) the market value of the Bonds that are to be redeemed in the early
redemption (based on the average closing price of the Bonds over the thirty (30) Trading Days preceding the Board of Directors'
resolution approving said redemption); however if the Early Redemption Date falls on an Interest Payment Date, only the interest amount,
which will be paid separately, will be deducted from the aforementioned average closing price; and (3) the balance of the Bonds cash flow
subject to early redemption, according to the original amortization table (*i.e.*, Principal plus the interest borne by the Bonds
on the early redemption date), while accounting for the Early Redemption Date, discounted at the Government Bond Yield (as defined below)
plus annual interest at a 1.5% rate. The discount of the Bonds to be paid by way of an early redemption shall be calculated from the Early
Redemption Date until the final payment date that applied to the Bonds to be paid by way of an early redemption. If additional interest
shall be paid due to the early redemption, the additional interest shall be paid with respect to the par value being redeemed by way of
an early redemption.

For the purpose of this Subsection, "**Government Bond Yield**" means the average weighted yield to maturity (gross), during a of seven (7) Business Days period, ending two (2) Business Days prior to the date of the early redemption notice, of two (2) series of Israeli Government Dollar-linked Bonds, bearing interest at a fixed rate, and having an average duration most similar to the average duration of the Bonds at the relevant date, *i.e.*, one series with the most similar average duration higher than the average duration of the Bonds at the relevant date, and one series with the most similar average duration lower than the average duration of the Bonds at the relevant date, weighted to reflect the average duration of the Bonds at the relevant date. Below is an example illustrating said calculation:

If the average duration of Government Bond A is 4 years, and the average duration of Government Bond B is 2 years, and the average duration of the balance of the Bonds is 3.5 years, the yield shall be calculated as follows:

4X + 2(1-X) = 3.5

Whilst

X = weight of the yield of Government Bond A.

1-X = weight of the yield of Government Bond B.

According to the calculation, the annual yield of Government Bond A shall be weighted at a rate of seventy five percent (75%) of the yield, and the average yield of Government Bond B shall be weighted at a rate of twenty five percent (25%) of the yield. It should be noted that insofar as the relevant date there will not be any Dollar Israeli Government Bonds, the examination will be made according to U.S. dollar Government Bonds of similar durations (as stated in the definition of the term "Government Bond Yield").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1.8 The Company shall provide the Trustee with a CFO Certificate detailing the manner of calculation for the
early redemption amount, including an active Excel spreadsheet which demonstrates the calculation performed by the Company, all in a form
satisfactory of the Trustee, no later than two (2) Business Days following the date the decision of the Company's relevant organs
to effect an early redemption of the Bonds.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1.9 Amounts paid withing the framework of a partial early redemption shall be deemed to have been made on
account of the most recent Principal payments closest to the Early Redemption Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1.10 Following the Early Redemption Date, the outstanding par value of the Bonds series shall decrease and
future payments of the Principal shall be decreased pursuant to the provisions of Subsection 9.1.9 above, and in the event of a full early
redemption of the Bonds, the Bonds shall be cancelled and no interest shall accrued with respect thereof following the redemption date.

&nbsp;&nbsp;&nbsp;&nbsp;9.2 <u>Early Redemption Initiated by the Stock Exchange</u> 

In the event that the Stock Exchange resolves to delist the Bonds in circulation because the value of the Bonds has fallen below the minimum amount prescribed in the Stock Exchange rules regarding the delisting of bonds, the Company shall carry out an early redemption of the Bonds, as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2.1 Within forty five (45) days from the date on which the Stock Exchange's Board of Directors resolved
to delist the Bonds as aforesaid, the Company shall announce by way of an Immediate Report an early redemption date on which a Bondholder
shall be entitled to redeem said Bonds.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2.2 The early redemption date shall occur no earlier than seventeen (17) days from the date in which the notice
was published and no later than forty-five (45) days after such date, but not during the period between the record date for an interest
payment and its *de facto* payment date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2.3 Upon the Early Redemption Date, the Company shall redeem the Bonds the holders thereof requested to redeem,
at the par value of said Bonds and interest accrued thereon until the actual payment date (plus linkage if any) (calculated on the basis
of 365 days in a year and the actual number of days that elapsed since the most recent interest payment date).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2.4 The determination of an Early Redemption Date as set forth above shall not prejudice the redemption rights
set forth in the Bonds of any of the Bondholders who shall not redeem them on the Early Redemption Date, but said Bonds shall be delisted
from the Stock Exchange and shall be subject, *inter alia*, to the tax implications deriving therefrom.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2.5 Bonds that have been redeemed as set forth above shall be cancelled and no interest shall accrue with
respect thereof after the redemption date. The early redemption of the Bonds as aforementioned shall deny the Bondholders of Bonds to
be redeemed of the right to payment on account of Principal and/or of interest for the period following the redemption date. The notice
of the Early Redemption Date will be Published by way of an Immediate Report delivered to the ISA and the Stock Exchange. This notice
shall specify the early redemption amount.

&nbsp;&nbsp;&nbsp;&nbsp;9.3 For the avoidance of doubt, the provisions of this Deed concerning withholding tax shall apply in full
also to the events described in this Section 9.

10. **Call for Immediate Repayment** 

&nbsp;&nbsp;&nbsp;&nbsp;10.1. Upon the occurrence of one or more of the events set forth below, the Trustee and the Bondholders shall
be entitled to call for the immediate repayment of the outstanding balance due to the Bondholders under the Bonds and this Deed:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.1. If the Company fails to pay the Bondholders any amount it is obligated to pay under the Bonds and/or this
Deed of Trust, within five (5) Business Days of the relevant payment date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.2. If the Company materially beaches the terms of the Bonds or this Deed of Trust and/or does not fulfill
any of its material undertakings with respect thereof, and the Company fails to cure such breach within fourteen (14) days.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.3. If it becomes evident that a material representation made by the Company under the Bonds or this Deed
of Trust is incorrect or incomplete, and the Trustee has provided notice thereof to the Company, and the Company failed to cure such breach
within fourteen (14) days from the date said notice was received.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.4. If the Company adopts a liquidation resolution of (other than a liquidation resulting from a merger with
another company) or if a permanent and final liquidation order is granted by the court with respect to the Company or if a permanent receiver
is appointed with respect to the Company, or if a similar resolution is adopted or if a similar official is appointed by the Company and/or
with respect thereto under the Insolvency Law or any other law, or if a Trustee was appointed pursuant the provisions set forth in the
Insolvency Law. It should be clarified that for the purposes of this Subsection, liquidation proceedings or other similar proceedings
with respect to the Company shall be proceedings under Israeli law or parallel proceedings under foreign law, similar to the Israeli proceeding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.5. If a temporary liquidation order or an order with similar characteristics according to the provisions
of the Insolvency Law, or a similar order under the relevant law, is granted, or if a temporary liquidator or another official of similar
characteristics is appointed according to the provisions of the Insolvency Law, or if a temporary trustee, as said term is defined under
the Insolvency Law is appointed or if any other similar official is appointed under applicable law or if any judicial resolution is issued
by the court, and such order or decision are neither rejected nor cancelled within forty-five (45) days from the date that said order
or decision was issued, as applicable. Notwithstanding the foregoing, the Company will not be granted any grace period with respect to
motions or orders filed or granted, as applicable, by the Company or with its consent. It should be clarified that for the purposes of
this Subsection, liquidation proceedings in respect of the Company shall be proceedings under Israeli law or parallel proceedings under
foreign law, similar to the Israeli proceeding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.6. If a foreclosure is imposed, execution actions taken or a pledge exercised on Material Asset of the Company
(as defined below), and the foreclosure was not removed or the action was not revoked, as applicable, within forty-five (45) days of them
being imposed or executed, as applicable. Notwithstanding the foregoing, the Company will not be granted any grace period in respect of
requests or orders submitted or granted, as applicable, by the Company or with its consent. It is clarified that for the purposes of this
Subsection, foreclosure proceedings or execution proceedings or pledge exercise proceedings will be proceedings under Israeli law or similar
proceedings under foreign law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.7. If a motion was filed for receivership or for appointing a receiver (temporary or permanent) or any similar
official to be appointed by virtue of the law over the Company or over the majority of the Company's assets (as defined below),
or an order is issued for the appointment of a temporary receiver or any similar official to be appointed by virtue of the law or an order
is issued for the appointment of a trustee, as this term is defined in the Insolvency and Economic Rehabilitation Law, on the Company
or on Material Asset of the Company (as defined below) – which was not revoked within forty-five (45) days of the date in which
they were filed or granted, as applicable; or if an order for appointing a permanent receiver or an order is issued for the appointment
of a trustee, as this term is defined in the Insolvency and Economic Rehabilitation Law for the company or on Material Asset of the Company
(as defined below) or a similar order was granted under the law applicable to the Company. Notwithstanding the aforesaid, the Company
shall not be granted any cure period with respect to an order for the appointment of a permanent receiver or an order is issued for the
appointment of a trustee, as this term is defined in the Insolvency and Economic Rehabilitation Law, or motions or orders submitted or
granted, as applicable, by the Company or with its consent. It is clarified that for the purposes of this Subsection, receivership proceedings
with respect to the Company shall be proceedings under Israeli law or a corresponding proceeding under foreign law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.8. (A) if the company files a motion for a stay of proceedings under Section 350 of the Companies Law or
the Insolvency Law, or a similar proceeding under the provisions of applicable law, or if such a stay of proceedings is granted or if
the Company files a petition for the commencement of proceedings order, as this term is defined in the Insolvency and Economic Rehabilitation
Law or a similar proceeding under applicable law, or if such an order is granted; or if the Company files a motion for a settlement or
arrangement with the Company's creditors under Section 350 to the Companies Law or under the Insolvency Law, or a similar proceeding under
applicable law (except for purposes of effecting (1) a merger with another company, including changes in the Company's capital structure
that are not prohibited under this Deed and/or (2) an arrangement between the Company and its shareholders which does not impact the Company's
ability to repay the Bonds and which is not prohibited under this Deed of Trust); or if the Company offers its creditors in any other
manner a settlement or arrangement as a result of the Company's inability to meet its obligations when they come due or if said motions
are filed at the Company's request or with its consent; or (B) if a motion is filed under Section 350 of the Companies Law or the Insolvency
Law (or a similar proceeding under applicable law) against the Company and without its consent, which has neither been rejected nor revoked
within forty-five (45) days from the date on which it was filed. It will be clarified that for the purposes of this Subsection, proceedings
and actions, such as an arrangement, with respect to the Company shall be proceedings as well as actions under Israeli law or similar
proceedings under foreign law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.9. If the Company ceased or gave notice of its intention to cease its payments or if it ceased or gave notice
of its intention to cease operating its businesses, as these may be from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.10. If the Company's main field of activity is no longer ownership
and operation of manufactured home communities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.11. If there occurs a material worsening in the Company's business as compared to its status on the
Issuance Date, and there is an actual concern that the Company will not be able to repay the Bonds when due; or if there exists an actual
concern that the Company will fail to meet its material undertakings towards the Bondholders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.12. If the Company fails to Publish any Financial Statements under applicable law or under this Deed of Trust
which it is required to publish within 30 days from the last date on which it was required to Publish them.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.13. If the Bonds cease to be rated by a Rating Agency for a period exceeding sixty (60) consecutive days,
for reasons and/or circumstances under the Company's control. The occurrence of the aforementioned event shall not constitute grounds
for calling for the immediate repayment of the Bonds so long as the Bonds are rated by one Rating Agency.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.14. If (A) one of the Company's other publicly traded bond series (on a standalone basis) was called
for immediate repayment, or (B) a Cross Default occurs, unless such calling for an immediate repayment or Cross Default, as aforesaid,
is rejected or revoked (including by way of settling said debt) within 30 days from the date on which of notice of the calling for the
immediate repayment or of the Cross Default event was given.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.15. If a merger was carried out, whether under Israeli law or under the law applicable to the Company, with
another entity (except for a company that was merged into the Company, when prior to such a merger it was fully consolidated in the Company's
Financial Statements), without obtaining the prior consent of the Bondholders, by way of an Ordinary Resolution, unless the Company or
the surviving entity represented to the Bondholders and the Trustee, at least ten (10) Business Days prior to the effective date of the
aforesaid merger that there exists no reasonable concern that the surviving entity will not be able to meet its obligations towards the
Bondholders as a result of said merger.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.16. If the group sells all or most of its assets (as calculated below), in a transaction or in a series of
related transactions (unless during the twelve (12) month period following said sale the Group acquires other assets within its field
of activity for an amount not less than 50.01% of the consideration received for the assets sold) without the prior consent of the Bondholders
in a Special Meeting and by a Special Resolution.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.17. If the Company breaches its undertaking with respect to a negative pledge set forth in Section 6.2.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.18. If the Company fails to comply with one or more of the Financial Covenants set forth in Section 6.1 above
for two consecutive quarters.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.19. If the Company breaches a term under Section 2.9 with respect to the expansion of the Bond series or with
respect to the issuance of a bond series or of other securities that constitute debt.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.20. If the Stock Exchange has suspended the trading of the Bond, except for a suspension caused by the creation
of uncertainty, as specified in Part IV of the Stock Exchange Bylaws, and such suspension has not been revoked within sixty (60) days.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.21. If the Bond are delisted from the Stock Exchange.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.22. If the rating of the Bond falls below the rating of ilBBB-..

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.23. If a Change of Control occurs, and the Company does not publish a tender offer for the purchase of all
the Bonds, at a price not lower than their par value, within 45 days from the occurrence of said event.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.24. If the Company ceases to be a Reporting Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.25. If the Company does not nominate a Company's Representative in Israel as set forth in Section 6.5
above, or is it breaches any of the provisions set forth in Section 6.6 above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.26. If the company breaches whichever of its undertakings set forth in in Section 6.7 above, with respect
to the expense cushion.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.27. If a "Going Concern" note has been recorded in the Company's Financial Statements for two consecutive
quarters.

For the purpose of Subsections 10.1.6, 10.1.7 and 10.1.16, "**most of the Company's assets**" shall mean an asset or a number of assets, in the aggregate, whose value, according to the Company's most recent consolidated Financial Statements published prior to the occurrence of the relevant event, constitutes at least 50% (fifty percent) of the total assets according to the Company's most recent consolidated Financial Statements; and - a "**Material Asset of the Company**", shall mean an asset or several assets in aggregate of the Company, whose value according to the most recent Financial Statements published prior to the occurrence of the relevant event, exceeds thirty five (35%) of the scope of total assets according to the said Financial Statements..

&nbsp;&nbsp;&nbsp;&nbsp;10.2. Upon the occurrence of any of the events set forth in the foregoing Section 10.1:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.1 The Trustee shall be required to convene a Bondholders' Meeting, which shall be held twenty-one
(21) days following the date of notice thereof (or any earlier date according to the provisions of Subsection 10.2.7 below), the agenda
of which shall include a resolution to call for the immediate repayment of the outstanding balance of the Bonds due to the occurrence
of any of the events stipulated in Section 10.1 above, as applicable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.2 The notice of the aforesaid meeting shall state that if the Company shall cause the revocation, cure or
removal of the event specified in Section 10.1 above for which the meeting has been called, prior to the date on which the meeting is
to be held, the Bondholders' Meeting shall be cancelled.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.3 It is hereby clarified that the foregoing shall by no means prevent the Trustee from convening a Bondholders'
Meeting at an earlier date according to the provisions of Subsection 10.2.7 below.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.4 The Bondholders' resolution to call for the immediate repayment of the Bonds shall be adopted at
a Bondholders' Meeting at which Holders of at least fifty percent (50%) of the outstanding Principal balance of the Bonds are present,
by a majority vote of the Bondholders participating, or by majority the votes of the participants at an adjourned Bondholders' Meeting
in which Bondholders of at least twenty percent (20%) of the outstanding Principal balance of the Bonds are present.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.5 If until the date on which said meeting is to be held, the events specified in Section 10.1 above for
which the meeting has been called are not revoked, cured or removed, and the Bondholders' Meeting resolution, as set forth in Subsection
10.2.1 above to call for the immediate repayment of the outstanding balance of the Bonds, was adopted pursuant to the provisions of Subsection
10.2.4 above, the Trustee shall be required to promptly call for the immediate repayment of the outstanding balance of the Bonds, provided
the Trustee has provided the Company seven (7) days' written notice of its intention to do so and the event with respect to which the
resolution was adopted was not revoked, cured or removed within such period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.6 The Publishing of the notice of the meeting as set forth in Subsection 10.2.1 above shall be deemed as
written notice to the Company with respect to the Trustee's intention to pursue the calling for the immediate repayment of the outstanding
balance of the Bonds, including according to Section 10.2.5 above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.7 The Trustee may, at its sole discretion, shorten and even cancel the twenty-one (21) day period (as set
forth in Subsection 10.2.1 above) if it is in the opinion that this is necessary for protecting the Bondholders' rights and/or shorten
and even cancel the seven (7) days' notice period (as set forth in Subsection 10.2.5 above), if the Trustee is of the opinion that
there is a concern that delivering such notice or delaying the meeting or the immediate repayment date will prejudice the possibility
of calling for the immediate repayment of the Bonds.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.8 If any of the Subsections to Section 10.1 above sets forth a "cure period" during which the
Company may act or adopt resolutions resulting in the removal of the grounds for calling for an immediate repayment, the Trustee or the
Bondholders shall be entitled to call for the immediate repayment of the Bonds as set forth in this Section 10 only upon the lapse of
such period and if the grounds stated therein were not removed within such period; nevertheless, the Trustee may shorten the period prescribed
in the Deed of Trust if it is of the opinion that a delay may prejudice the Bondholders' rights.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.9 If the Company is provided notice whereby the Bonds have been called for an immediate repayment pursuant
to the provisions of this Section 10, the Company undertakes to take, from time to time, and at any time requested to do so by the Trustee,
all reasonable actions necessary to enable the Trustee to exercise all the powers vested therein; particularly, the Company shall take
all the following actions, no later than ten (10) Business Days of the date of the Trustee's request:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.9.1. transfer and deliver to the Trustee the Principal and accrued interest (if any) on the Bonds due for immediate
repayment, including Default Interest if applicable, and linkage, if any, irrespective of their maturity dates;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.9.2. provide all the declarations and/or execute all the documents and/or take and/or cause the taking of all
actions necessary and/or required under law to validate the exercise of authorities, powers and rights of the Trustee and/or its representative
in with respect to the immediate repayment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.9.3. provide all notices, orders and instructions as the Trustee deems fit with respect to the immediate repayment.

For purpose of this Section 10 – written notice executed by the Trustee confirming that an action requested thereby, within the scope of its authority, is reasonable, shall constitute *prima facie* evidence thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.10 Subject to the provisions of applicable law, the duties of the Trustee under this Section 10 are subject
to it being *de facto* knowledgeable of the facts, events, circumstances, and occurrences specified therein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.11 For the avoidance of doubt, it is clarified that the right to call for an immediate repayment as aforesaid
or the calling for an immediate repayment shall neither derogate nor prejudice any other or additional remedy available to the Bondholders
or to the Trustee under the terms of the Bonds and the provisions of this Deed or under the law, and the non-calling for an immediate
repayment or the non-exercise of collateral (if granted) upon the occurrence of any of the events set forth in Section 10.1 above, shall
by no means constitute any waiver of the Bondholders' or the Trustee's rights, unless expressly stated otherwise.

11.  **<u>Claims and Proceedings by the Trustee</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;11.1. Without derogating from any provision of this Deed of Trust, the Trustee shall be entitled, at its sole
discretion, with a seven (7) days' written notice to the Company, insofar as such notice would not prejudice the Bondholders'
rights, and subject to Section 23 (Indemnification of the Trustee), and shall be obliged, if required by an Ordinary Resolution adopted
by the Bondholders pursuant to the following provisions, to initiate all legal proceedings as it deems fit, subject to the provisions
of any law, in order to the exercise and/or protect the Bondholders' rights and/or enforce the Company's performance of any
of its undertakings under this Deed of Trust. Notwithstanding the foregoing, the right to call for an immediate repayment shall be governed
by the provisions of Section 10 above and not by this Section 11.

&nbsp;&nbsp;&nbsp;&nbsp;11.2. The Trustee may, at its sole discretion, file a motion to the court to receive instructions on any matter
connected with and/or pertaining to this Deed of Trust.

&nbsp;&nbsp;&nbsp;&nbsp;11.3. Subject to the provisions of this Deed of Trust, the Trustee may, but shall not be required to, convene
a Bondholders' Meeting at any time in order to discuss and/or obtain instructions by way of an Ordinary Resolution on any matter
pertaining to this Deed of Trust, provided that the meeting is convened without delay.

&nbsp;&nbsp;&nbsp;&nbsp;11.4. The Trustee may, at its sole discretion, delay the performance of any of its actions pursuant to this
Deed of Trust until instructions are provided by the Bondholders' Meeting by way of an Ordinary Resolution, and/or until court instructions
are received regarding the course of action, provided that the Trustee is not entitled to delay such proceedings once it has obtained
the Bondholder's approval in the Bondholders' Meeting to call for an immediate repayment or initiate any proceedings, as well
as in a case in which a delay may prejudice the Bondholders' rights.

&nbsp;&nbsp;&nbsp;&nbsp;11.5. For the avoidance of doubt, the foregoing provisions shall by no means prejudice and/or derogate from
the right vested to Trustee to apply to the court, at its sole discretion, even before the Bonds are payable, in order to obtain an order
concerning its position as Trustee. The expenses accrued under this Section will be covered according to provisions set forth in Section
23 (Indemnification of the Trustee).

12.  **<u>Trust over Receipts</u>** 

All amounts received by the Trustee from the Company under this Deed, other than the Trustee's fees and expenses, shall be held in trust by the Trustee. Amounts received by the Trustee from the Company under this Deed shall first be used to repay the Trustee's fees, reasonable expenses, payments, levies and liabilities incurred by the Trustee or imposed thereon or those caused during or as a result of actions pertaining to the execution of its role as Trustee under this Deed or those otherwise associated with the terms of the Deed of Trust (provided that the Trustee shall not be paid twice, namely by both the Company and the Bondholders). The balance shall be used, unless otherwise resolved by way of a Bondholders Special Resolution, in advance, for the following purposes and according to the following order of priorities: **<u>first</u>** – to repay the Bondholders, if any, for liabilities incurred and payments expensed thereby exceeding their Pro Rata Portion (as defined in Section 23 below) concerning an indemnity undertaking pursuant to Section 23 below; **<u>second</u>** – to repay the Bondholders for liabilities incurred and payments expensed thereby pursuant to their Pro Rata Portion concerning an indemnity undertaking pursuant to Section 23 below; **<u>third</u> -** to repay the Bondholders, if applicable, any Default Interest due thereto under the terms of the Bonds, *pari passu* and *pro rata*, without any individual Bondholder having any preference or priority over another; **<u>fourth</u>** – to repay the Bondholders overdue Principal amounts payable thereto under the terms of the Bonds, *pari passu* and *pro rata*, without any individual Bondholder having any preference or priority over another; **<u>fifth</u>** – to repay the Bondholders interest payments payable thereto under the terms of the Bonds, *pari passu* and *pro rata*, without any individual Bondholder being having any preference or priority over another; **<u>sixth</u>** – to repay the Bondholders Principal amounts, irrespective of their maturity date, *pari passu* and *pro rata*, without any individual Bondholder having to any preference or priority over another. Any excess amounts, if any remain after completing all the above-mentioned distributions, shall be paid by the Trustee to the Company or to any successor entity. Tax shall be withheld from all payments to the Bondholders pursuant to applicable law.

For the avoidance of doubt, to the extent the Company has to bear any of the expenses but has not borne them, the Trustee will act to obtain said amounts from the Company, and in the event it succeeds in obtaining them, these amounts will be held by the Trustee in trust and will be used for the purposes and according to the order of priority set forth in this Section above.

13.  **<u>Power to Withhold Distribution of Funds</u>** 

Notwithstanding the provisions of Section 12 above, should the amount received as a result of proceedings pursuant to the provisions of Section 11 above, which shall be available at a given time for distribution to the Bondholders, as set forth in Section 12 above, be equal to or lower than NIS one million (1,000,000) (the "**Minimum Amount**"), the Trustee shall not be required to distribute said amount and shall be entitled to invest it, fully or part thereof, in Permitted Investments, as it deems fit.

"**Permitted Investments**" – Investments in bank deposits with one or more of the five largest banks in Israel whose credit rating is not below ilAA or in Dollar-linked bonds issued by the Government of Israel or by the Government of the United States.

At the earlier of (i) the time when the aforementioned investments, including any profits resulting therefrom, is equal to or higher than the Minimum Amount and (ii) the next payment date of Principal and/or Interest thereon to the Bondholders (even if the amount accrued by such date is lower than the Minimum Amount), the Trustee shall distribute said accrued amounts to the Bondholders as set forth in Section 12 above.

Notwithstanding the aforesaid in this Section 13, following an Ordinary Resolution of the Bondholders, the Trustee shall distribute the amounts received thereby as a result of proceedings initiated pursuant to the provisions Section 11 above, even if said amounts fall below the Minimum Amount.

14.  **<u>Failure to Make Payment for Reason Beyond the Company's Control</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;14.1. Any amount payable to a Bondholder which was not actually paid to such Bondholder on the date on which
it was due for a reason beyond the Company's control, despite the Company's ability and willingness to make such payment,
in full and in a timely fashion, shall cease to bear interest as of the payment date, and such Bondholder shall be entitled only to those
amounts to which it was entitled on the date on which the payment was due, provided that said amount has been deposited with the Trustee
as set forth in Section 14.2 below. Notwithstanding the foregoing, to the extent said amounts, under the circumstances, remain in the
Company's account, the Company shall transfer them to the Bondholder (or the Trustee as set forth in Section 14.2 below) together with
all profits accrued thereon, after the deduction of applicable tax, if any.

&nbsp;&nbsp;&nbsp;&nbsp;14.2. The Company shall deposit with the Trustee, within fourteen (14) days following the payment date, the
amount payable which was not paid for a reason beyond the Company's control, as set forth in Subsection 14.1 above, and shall provide
written notice thereof to the relevant Bondholders with, and said deposit shall be deemed as the settling of said payment, and in the
event of settling all amounts due in respect of the Bonds, it shall also be deemed to be a final redemption of the Bonds.

&nbsp;&nbsp;&nbsp;&nbsp;14.3. The Trustee shall invest any amount that has been deposited in its name pursuant to this Deed of Trust
in Permitted Investments (as defined in Section 13 above), as the Trustee shall see fit and subject to the provisions of applicable law.
If the Trustee has acted in such manner, it will not be liable to those entitled to said amounts, except for proceeds to be received from
the realization of such investments, less the expenses associated therewith, including trust account administration costs and net of any
mandatory payments. The payment to the Bondholders shall be made against the presentation of evidence acceptable to the Trustee in its
absolute discretion.

The Trustee shall hold said funds and shall invest them in Permitted Investments as described above, until the earlier of (i) the end of one (1) year from the final repayment date of the Bonds and (ii) their date of payment to the Bondholders. After said date, the Trustee shall transfer the remaining amounts to the Company, including any profits earned from the investment thereof, less the Trustee's fees and expenses incurred according to the provisions of this Deed of Trust. The Company shall hold the aforementioned amounts in trust for an additional six (6) year period of from the date on which these were transferred to the Company by the Trustee, in favor of the Bondholders who are entitled to these amounts, and the provisions of the Deed of Trust concerning the investment of the funds as set forth above shall apply, *mutatis mutandis*. Following the transfer of said amounts to the Company, the Trustee will be released from any payment obligation with respect to said amounts due to the entitled Bondholders. The Company shall confirm to the Trustee in writing that these funds were transferred to the Company and the fact that said funds were received in trust for the entitled Bondholders, and the Company shall indemnify the Trustee in respect of any claim, expense and/or damage whatsoever that may be incurred by the Trustee as a result of and in respect to the transfer of said funds, unless the Trustee acted in bad faith or with gross negligence (unless exempt by law), or with malicious intent. Funds which a Bondholder has not claimed from the Company at the end of seven (7) years from the of final repayment date of the Bonds shall be converted in favor of the Company, and it shall be entitled to use the remaining funds for any purpose whatsoever. For the avoidance of doubt, the foregoing shall not derogate from the Company's undertaking to repay the Bondholders the amounts to which they are entitled under applicable law.

15.  **<u>Receipts as Proof</u>** 

Without derogating from any other provisions of the Bonds, a receipt signed by any Bondholder or any written evidence from the transferring Stock Exchange member shall constitute proof of the full settlement of any payment that was made by the Company as set forth in such receipt or evidence.

A receipt from a Bondholder regarding the amounts of Principal and Interest that were paid to thereto by the Trustee in respect of a Bond or any evidence from a transferring Stock Exchange Member shall release the Trustee from making the payment of the amounts set forth in the receipt or evidence.

Subject to the provisions of Section 14 above, a receipt from the Trustee regarding the deposit of Principal and interest amounts therewith in favor of the Bondholders shall be deemed a receipt from the Bondholders and shall release the Company in connection therewith.

16.  **<u>Undertakings of the Company to the Trustee</u>** 

The Company hereby undertakes to the Trustee that for as long as the Bonds (including any interest thereon) have yet to be fully repaid, it shall:

&nbsp;&nbsp;&nbsp;&nbsp;16.1 Pursue and manage the Company's business and those of the entities controlled thereby in an orderly
and proper manner.

&nbsp;&nbsp;&nbsp;&nbsp;16.2 Notify the Trustee of and allow it to participate in all General Meetings (whether annual general meetings
or special general meetings) of the Company's Shareholders, even by using means of communication, at the Company's expense,
without granting the Trustee voting rights at such meetings. Notices through the MAGNA or Maya systems will be deemed sufficient notice
of the General Meetings.

&nbsp;&nbsp;&nbsp;&nbsp;16.3 Deliver to the Trustee or to its authorized representative (the Trustee shall notify the Company of the
appointment thereof, when appointed) any information about the Company (including explanations, calculations and documents relating to
the Company, its business and financial condition and information which at the reasonable discretion of the Trustee is required for protecting
the Bondholders' rights) no later than ten (10) Business Days of the Trustee's request, and instruct its accountants and legal
advisors to do so no later than ten (10) Business Days of the Trustee's request, provided that in the Trustee's reasonable
opinion, the information is required by the Trustee and those empowered thereby for exercising and implementing the Trustee's authorities,
powers and rights under this Deed of Trust.

&nbsp;&nbsp;&nbsp;&nbsp;16.4 Maintain and keep books and records as required by U.S. GAAP and in accordance with the provisions of
any law applicable to the Company and enable the Trustee and/or anyone the Trustee may appoint in writing for such purpose, to inspect,
at a date scheduled in advanced and at any reasonable time, no later than ten (10) Business Days f the Trustee's request, any such
books and/or records. It should be noted that the documents can be transferred by electronic means and/or by courier, subject to the approval
of the Company or they can be transferred by the Trustee to its advisor subject to the same confidentiality requirement that applies to
the Trustee.

&nbsp;&nbsp;&nbsp;&nbsp;16.5 Notify the Trustee in writing, immediately upon becoming aware of any case in a foreclosure was imposed
and/or execution action was initiated with respect to most of the Company's assets (as this term is defined in Section 10.1 above), if
a receiver or permanent liquidator or a Trustee is appointed for most of the Company's assets (as this term is defined in Section 10.1
above), within the framework of a motion for stay of proceedings pursuant to Section 350 of the Companies Law or to the Insolvency Law,
or under any law applicable to the Company or if any other official was appointed with respect to most of the Company's assets (as said
term is defined in Section 10.1 above), and to use, at its expense and as soon as possible, all the reasonable means required to remove
such foreclosure or revoke such execution action or remove the receiver, the liquidation or trusteeship, as applicable.

&nbsp;&nbsp;&nbsp;&nbsp;16.6 Notify the Trustee immediately and in writing (without accounting for cure and waiting periods set forth
in the same sections, if applicable), upon the Company becoming aware, or after the Company's concerns have materialized, as applicable,
of the occurrence of any of the events specified in Section 10.1 above, including in all the subsections.

&nbsp;&nbsp;&nbsp;&nbsp;16.7 Alongside the delivery of the CFO Certificate with respect to the Financial Covenants pursuant to Section
6.1, the Company shall deliver to the Trustee a certificate signed by the Company's CEO or by its Chief Financial Officer whereby,
following the examinations he or she has conducted, during the period commencing at the later of the date this Deed and the date of the
previous certificate delivered to the Trustee, and until the date of the present certificate, the Company has not breached the provisions
set forth in this Deed, and did not breach any of the terms of the Bonds, unless explicitly stated otherwise in such certificate.

&nbsp;&nbsp;&nbsp;&nbsp;16.8 Provide the Trustee upon its request, with any declarations, representations, documents, details and/or
additional information that shall be reasonably required by the Trustee in order to protect the Bondholders' rights no later than
15 Business Days of the date of the Trustee's request.

&nbsp;&nbsp;&nbsp;&nbsp;16.9 Provide the Trustee with a copy of any document or information that the Company has delivered to the Bondholders.

&nbsp;&nbsp;&nbsp;&nbsp;16.10 Notify the Trustee in writing with respect to any change in the Company's name or address no later
than 10 Business Days of the date of such change.

&nbsp;&nbsp;&nbsp;&nbsp;16.11 Deliver to the Trustee no later than the end of thirty (30) days of the Issuance Date of the Bonds under
a Shelf Offering Report and/or as of the series expansion date a true copy of the Bond Certificate.

&nbsp;&nbsp;&nbsp;&nbsp;16.12 Notify the Trustee by way of a written notice signed by the Company's Chief Financial Officer within five
(5) Business Days of the Trustee's demand, of the execution of any payment to the Bondholders and the outstanding balance due to
the Bondholders at said date (and following the payment).

&nbsp;&nbsp;&nbsp;&nbsp;16.13 Provide the Trustee with copies of the notices and invitations that the Company shall provide to the Bondholders
as specified in Section 24 of this Deed.

&nbsp;&nbsp;&nbsp;&nbsp;16.14 Provide the Trustee, upon its first written request, a written confirmation signed by an accountant that
all the payments to the Bondholders were paid when due, showing the par value balance of the of the Bonds in circulation.

The Trustee hereby undertakes to maintain the confidentiality of all information concerning the Company provided thereto under this Deed of Trust and shall neither disclose it to another nor will it make any other use therewith, unless the disclosure or use thereof is required in order for the Trustee to fulfill its role under the law, the Deed of Trust, or under a court order in order to protect the Bondholders' rights. For the avoidance of doubt, the transfer of information to the Bondholders (including by way of Publishing the information) in order to make a decision concerning the their rights under this Deed of Trust, or to provide a report on the Company's status and/or as required under applicable law, shall not constitute a breach of the aforesaid confidentiality undertaking.

17.  **<u>The Trustee as Representative</u>** 

The Company hereby irrevocably appoints the Trustee as its representative to execute and perform in its name and in its stead all the actions it is obliged to perform according to the terms and conditions of this Deed, and to appoint any other Person the Trustee may deem fit for performing its duties pursuant to this Deed of Trust (subject to appropriate confidentiality undertakings), in each case, if the Company has not performed the actions which it is obliged to perform under the provisions of this Deed within a reasonable period of time, as determined by the Trustee, as of the date of the Trustee's written demand.

The appointment pursuant to this Section 17 does not oblige the Trustee to perform any action, and the Company hereby releases the Trustee in advance in the event that the Trustee does not perform any action when due and and/or performs it inappropriately. In addition, the Company hereby waives in advance any claim against the Trustee and/or its agents with respect to any damage incurred and/or which might to be incurred thereby, whether directly and/or indirectly, due to any action and/or omission of the Trustee pursuant to the provisions of this Section 17, unless the Trustee acted in bad faith or with gross negligence, willful misconduct or malicious intent.

18.  **<u>Other Agreements between the Trustee and the Company</u>** 

Subject to applicable law, neither the fulfillment of the Trustee's duties hereunder nor its mere status as a Trustee under this Deed of Trust, shall prevent the Trustee from entering into transactions with the Company in the Company's ordinary course of business, provided that such transactions do not place the Trustee in a conflict of interest toward the Bondholders.

19.  **<u>Reporting by the Trustee</u>** 

As of Issuance Date, the Trustee shall prepare, no later than June 30 of each calendar year, an annual report regarding the affairs of the trusteeship with respect to the Bonds (the "**Annual Report**"), which shall contain reports on extraordinary events associated with the trusteeship that occurred during the preceding year and other information as required under the Securities Law.

The Trustee shall notify the Bondholders of any material breach of this Deed of Trust by the Company of which it becomes aware, including the actions it has taken to prevent such breach or secure the fulfillment of the Company's obligations, as applicable.

The Trustee shall notify the Bondholders of any extraordinary event that is likely to have a material impact on the Bondholders' rights, immediately upon becoming aware thereof.

The Trustee shall provide a report regarding actions performed under the provisions of Chapter E1 to the Securities Law, pursuant to a reasonable demand of Bondholders holding of at least 10% (ten percent) of the par value of the Bonds, within a reasonable time from the date of demand, all subject to the confidentiality duty towards the Company set forth in Section 35J(d) of the Securities Law.

Upon the request of Bondholders holding more than five percent (5%) of the outstanding Principal balance of the Bonds, the Trustee shall furnish to the Bondholders information regarding its expenses associated with the trusteeship under this Deed of Trust.

As at the execution date of this Deed, the Trustee declares that it is insured under professional liability insurance in an amount of ten million Dollars ($10,000,000)<sup>3</sup> for the period (the "**Coverage Amount**"). To the extent that before the full repayment of the Bonds, the Coverage Amount will fall below eight million Dollars ($8,000,000)<sup>4</sup> for any reason whatsoever, the Trustee will update the Company no later than seven (7) Business Days from the date on which it was notified by the insurer of the abovementioned decrease in order to publish an Immediate Report on said matter. The provisions of this Section shall apply until the effective date of regulations under the Securities Law which shall regulate the requirement of the insurance coverage of the Trustee enter into effect. Once the said regulations enter into effect, the Trustee shall be required to update the Company only if it fails to comply with the requirements set forth in the regulations.

20.  **<u>Trustee's Fees</u>** 

The Company shall pay the Trustee fees for the services rendered thereby with respect to this Deed of Trust, as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20.1 In respect of its services as Trustee during the first twelve (12) months after the Issuance Date, a fee
of NIS 26,000, which shall be paid immediately following the closing of the Offering (the "**First Term** ").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20.2 After the original issuance of the series, whenever additional Bonds of the same series are issued, or
if the scope of the series is expanded in any other way, the Trustee's annual fee shall be increased by an amount reflecting the
full increase rate of the series' volume, in a fixed manner until the end of the trust period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20.3 For each hour of work required for the purpose of special actions taken by the Trustee in connection with
its service as Trustee to the Bondholders – a fee of NIS 500 per hour shall be paid. Special actions will include any action which
is not in the ordinary course of business, including the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20.3.1 Actions which the Trustee may take following the Company breaching or allegedly breaching its obligations
under this Deed of Trust.

<sup>3</sup> At the time of renewal of the policy.

<sup>4</sup> See fn. 5.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20.3.2 Special actions that may be required or should be performed for the purpose of fulfilling its functions
under this Deed with respect to the Bondholders' rights or the protection thereof, including due to the Company's non-compliance
with its obligations under this Deed, including convening and attending the Bondholders' Meeting.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20.3.3 Involvement in any judicial or quasi-judicial proceedings concerning the fulfillment of its obligations
under this Deed of Trust, including according to any order or instruction issued by a competent authority.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20.3.4 Any action or duty which will be added or modified by law (including any regulation, order, judicial directives,
ISA opinion letters, etc.).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20.3.5 Actions concerning the registration or cancellation of registration of collateral in a register maintained
under any law (including abroad), as well as inspection, control supervision, enforcement, and so forth of liabilities (such as restrictions
on the Company's ability to act freely, pledges imposed on assets, and the like), undertaken or to be undertaken by the Company or by
whomever on its behalf or for it, in order to secure the Company's other undertakings or those of whomever on its behalf (such as
making payments under the terms of the Bonds) toward the Bondholders, including with respect to the essence of the terms of said collateral
and undertakings and the fulfillment thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20.3.6 For the Trustee's participation in the Bondholders' Meetings, the Trustee shall be entitled
to a fee in the amount of NIS 750.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20.3.7 If the Issuance is canceled or deferred of after the Trustee has already carried out work with respect
to the drafting of trust documents, the Trustee will charge an amount of NIS 500 per hour, according to a detailed hourly report, and
the maximum amount payable shall be NIS 10,000.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20.4 The payments set forth in Sections 20.1– 20.2 above shall be linked to the Consumer Price Index,
whereby the base index shall be the index for the month of June, which was published on July 15, 2025; nevertheless, in any event, an
amount lower than the amount specified in this Deed will not be paid.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20.5 Reimbursement of reasonable expenses incurred by the Trustee in its capacity as Trustee to the Bondholders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20.6 Should there be any change to the provisions of applicable law pursuant to which the Trustee shall be
required to perform additional actions, examinations and/or prepare additional reports, the Company undertakes to bear all reasonable
expenses incurred by the Trustee in connection therewith.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20.7 Value Added Tax shall be added to all payments specified above in this Section 20 in accordance with applicable
law on the payment date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20.8 If the Trustee's term of office is terminated in accordance with Section 27 below, the Trustee shall
not be entitled to an additional payment or fees following the termination date. For the avoidance of doubt, the Trustee shall be entitled
to receive fees even if, during its term office, a receiver is appointed in respect of the Company or if the Company enters into liquidation
proceedings.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20.9 All the amounts stated in this appendix shall have priority over the funds due to the Bondholders.

21.  **<u>Special Powers of the Trustee</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21.1 Within the framework of performing its duties associated with the trusteeship created under this Deed
of Trust, the Trustee shall be entitled to commission the opinion and/or advice of any attorney, accountant, appraiser, assessor, broker
or other expert. The Trustee is entitled to rely upon the opinion and/or advice of such Person whether said opinion and/or advice was
prepared at the request of the Trustee or by the Company or whomever on its behalf, and the Trustee shall not be required to pay (and
no amount shall be offset from the payments due to the Trustee hereunder) any amount associated with any loss or damage that may be caused
as a result of any action and/or omission performed thereby while relying on said opinion and/or advice, unless the Trustee acted in bad
faith or with gross negligence, willful misconduct or malicious intent. The Company will bear reasonable fees pertaining to engaging the
advisors appointed as aforesaid, provided that the Trustee will provide the Company advance notice of its intention to obtain an expert
opinion or advice as aforesaid, to the extent possible under the circumstances, and to the extent it will not prejudice the Bondholders'
rights, and in such case the notice shall be provided retrospectively, together with details of the fees required for executing the consultation
and the purpose of the opinion or the advice, and that the said fees do not exceed what is customary and acceptable. Nevertheless, the
Publishing of the Bondholders' Meeting's results concerning a resolution for the appointing of advisors as aforesaid shall be deemed
sufficient notice to the Company thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21.2 Any advice and/or opinion may be provided, sent or received by way of letter, telegram, facsimile, e-mail
and/or any other electronic means for the transmission of information in writing, and the Trustee will not be responsible in respect of
actions it took while relying on advice and/or an opinion or on information transferred in one of the aforementioned manners, even if
it contains errors and/or these were inauthentic, unless the Trustee was aware that the opinion or information transferred in one of the
aforementioned manners contained errors or was inauthentic, or otherwise acted in bad faith or with gross negligence (unless exempt by
law) or malicious intent.

22.  **<u>Trustee's Authority to Engage Agents</u>** 

The Trustee shall be entitled to appoint an agent, or agents, to act in its stead, whether an attorney or other Person, in order to execute, or to participate in the execution of, special actions that are required to be performed with respect to the trusteeship created under this Deed, and without derogating from the generality of the foregoing, to initiate legal proceedings, provided that the Trustee provided the Company with advance written notice with respect to the appointment of such agent(s) (unless such advance notice shall prejudice the Bondholders' rights, in which case the notice shall be provided retrospectively, as soon as possible thereafter in order not to impact the Bondholders' rights). The Trustee shall further be entitled to settle, at the Company's expense, the reasonable, documented expenses of any such agent, and the Company shall, upon the Trustee's first demand, immediately reimburse any such expense to the Trustee, provided that the Trustee provided the Company prior notice regarding the appointing of such agent, to the extent possible under the circumstances, and provided it does not prejudice the Bondholders' rights, and in such a case the notice will be provided retrospectively. The Company may object in writing, within seven (7) Business Days of the date on which it received said notice, to the appointment of a particular agent on any reasonable grounds, if the agent is a competitor or if there exists a conflict of interests, whether directly or indirectly in its notice, the Company shall detail its reasonable grounds for such objection. Nevertheless, the Company's objection to the appointment of a certain agent appointed by the Bondholders' Meeting shall not delay the commencement of engagement of said agent if the delay will prejudice the Bondholders' rights.

23.  **<u>Indemnification of the Trustee</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;23.1. The Company and the Bondholders (as of a given record date, as provided in Section 23.5 below), each in
respect of its undertakings as is set forth in this Section 23, hereby undertake to indemnify the Trustee and each of its officers, employees,
agents or advisors appointed on its behalf according to the provisions of this Deed and/or a resolution duly adopted by the Bondholders
at a Bondholders' Meeting pursuant to the provisions of this Deed (hereinafter, all or any part thereof, jointly or severally, the
" **Indemnitees** "), with respect to the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.1.1 Any loss or liability in tort and/or any financial liability pursuant to a final ruling (regarding which
no stay of execution has been issued), arbitration award or settlement that has concluded (and so far as the settlement concerns the Company,
the Company's consent to the settlement has been granted) deriving from actions performed by any of the Indemnitees, or actions they must
perform by virtue of this Deed and/or their capacity by virtue of this Deed and/or by applicable law and/or by an order of a competent
authority with respect to the Bonds and/or at the request of the Bondholders and/or that of the Company;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.1.2 The fees of the Indemnitees and reimbursement for reasonable expenses incurred thereby and/or those which
shall be incurred thereby, including within the framework of the trusteeship or in respect thereof, which in their opinion were necessary
for the performance of the aforementioned actions and/or for the exercise of authorizations and permissions granted under this Deed and/or
for their roles under this Deed, as well as with respect to any legal proceeding, obtaining legal or other expert opinions, negotiations,
disagreements, insolvency proceedings, collection proceedings, debt arrangements, debt assessments, valuations, claims and demands associated
with any matter and/or actions taken and/or omitted in any manner with respect to the foregoing.

The indemnity undertaking provided under this Section 23 shall be subject to the following conditions:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.1.3 The Indemnitees shall not demand advance indemnification in respect of an urgent matter (without derogating
from their right to retrospective indemnification for such matter to the extent they are entitled thereto);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.1.4 A final judicial ruling did not resolve that the Indemnitees have acted in bad faith, and/or that the
action with respect to which the indemnification is required, falls beyond the scope of their duties, and/or was not performed pursuant
to applicable law and/or this Deed of Trust;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.1.5 A final judicial ruling did not resolve that the Indemnitees have acted with gross negligence which is
not exempt by law, as may be in effect from time to time; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.1.6 A final judicial ruling did not resolve that the Indemnitees have acted with malicious intent.

The indemnity undertakings under this Section 23.1 shall be referred to as the "**Indemnity Undertaking**".

It is hereby agreed that in any event in which a final judicial ruling resolves that the Indemnitees are not entitled to indemnification, the Indemnitees with respect to which such resolution was made shall reimburse the indemnity amounts, to the extent these were paid thereto.

&nbsp;&nbsp;&nbsp;&nbsp;23.2. Without derogating from the rights of the Indemnitees pursuant to the Indemnity Undertaking, whenever
the Trustee is obligated to take any action under the this Deed of Trust, under applicable law, under an order issued by a competent authority
or at the Bondholders' or the Company's, including without limitation, the initiation of proceedings or the filing of claims
at the Bondholders' request, the Trustee shall be entitled to refrain from taking any action as aforesaid until it receives a monetary
deposit satisfactory thereto, in order to cover the Indemnity Undertaking (the "**Financing Cushion**") in the amount required
at first priority from the Company, and in the event that the Company does not deposit the entire Financing Cushion amount at the date
required by the Trustee, the Trustee shall contact the Bondholders holding Bonds as of the record date (as provided in Section 23.5 below)
and request each Bondholder to deposit its Pro Rata Portion (as defined below) of the Financing Cushion amount with the Trustee.

&nbsp;&nbsp;&nbsp;&nbsp;23.3. The Indemnity Undertaking:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.3.1  **<u>Shall apply to the Company</u>** in any event of (1) actions taken at the discretion of the Trustee
and/or under applicable law and/or required under the Deed of Trust or required in order to protect the Bondholders' rights (including
at a Bondholder's request for such protection) and/or a case in which the Indemnity Undertaking arises under this Deed (except as
specified in Section 23.3.2(1) below); and (2) actions taken and/or required by the Company's request.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.3.2  **<u>Shall apply to Bondholders</u>** who held Bonds on the applicable record date (as provided in
Section 23.5 below) in any event of (1) actions that were taken and/or those required at the Bondholders' request (excluding actions
taken at the Bondholders' request in order to protect the Bondholders' rights), and (2) the Company's failure to pay
the Indemnity Undertaking it was required to pay under Subsection 23.3.1 above (subject to the provisions of Section 23.7 below). For
the avoidance of doubt, it shall be clarified that non-payment under this Subsection 23.3.2 shall not derogate from the Company's
duty to bear the Indemnity Undertaking in accordance with Section 23.3.1 above.

&nbsp;&nbsp;&nbsp;&nbsp;23.4. In any event in which (a) the Company fails to pay the amounts required to cover the Indemnity Undertaking
and/or fails to deposit the Financing Cushion amount, as applicable, following a request made in accordance with Section 23.3 above, (b)
the Indemnity Undertaking applies to the Bondholders pursuant to Subsection 23.3.2 above or (c) the Bondholders were asked to deposit
the amount of Financing Cushion amount pursuant to the provisions of Section 23.3 above, the following provisions shall apply to the payment
of the applicable amount:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.4.1  **<u>First</u>** – this amount shall be financed out of the Interest and/or the Principal payments
that the Company shall pay the Bondholders after the date of the required action, and the provisions of Section 12 above shall apply;
and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.4.2  **<u>Second</u>** – if the Trustee is of the opinion that the amounts deposited in the Financing
Cushion will not satisfy the Indemnity Undertaking, each Bondholder (as of the record date, as provided in Section 23.5 below) shall deposit
its *pro rata* portion of the shortfall with the Trustee. The amount deposited by each Bondholder shall bear an annual interest at
a rate equal to the annual interest rate of the Bonds (as is set forth in the First Schedule to the Deed of Trust), and shall be paid
according to the priorities set forth in Section 12 above.

"**Pro Rata Portion**" means the relative portion of the Bonds held by a Bondholder on a given record date (as provided in Section 23.6 below), out of the total number of Bonds in circulation on such date. For the avoidance of doubt, the calculation of the Pro Rata Portion of any Bondholder shall remain unchanged even if, after such record date, a change shall occur to the number of Bonds held by such Bondholder.

&nbsp;&nbsp;&nbsp;&nbsp;23.5. For the avoidance of doubt it is hereby clarified that Bondholders that shall bear responsibility to cover
expenses as aforesaid in this Section may bear expenses as aforesaid in this Section beyond their Pro Rata Portion, in which case the
reimbursement of such funds shall be in accordance with the order of priority set forth in Section 12 above. The record date for determining
the Bondholders' Indemnity Undertaking and/or for the Bondholders' liability of payment of the Financing Cushion shall be
as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.5.1 In any event where the Indemnity Undertaking on or payment of the Financing Cushion is required due to
an urgent action necessary in order to prevent a materially adverse impact to the Bondholders' rights, without a prior resolution
adopted at a Bondholders' Meeting – the record date shall be the end of the Trading Day on which the action has been taken
(and if such day is not a Trading Day, the preceding Trading Day).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.5.2 In any event where the Indemnity Undertaking or payment of the Financing Cushion is required pursuant
to a resolution adopted at a Bondholders' Meeting – the record date for the Indemnity Undertaking shall be the record date
for participation at such Bondholders' Meeting (as such date shall be set forth in the notice convening the Bondholders' Meeting)
and such date shall apply to all the Bondholders, including those who were not present or did not attend the Bondholders' Meeting.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.5.3 In any other event or in the event of any disagreement with respect to the record date – the record
date shall be determined by the Trustee at its sole discretion.

&nbsp;&nbsp;&nbsp;&nbsp;23.6. For the avoidance of doubt, the Trustee's receipt from Bondholders of payments paid in respect of
the Indemnity Undertaking pursuant to the provisions of Subsection 23.3.2(2) above shall not derogate from the Company's undertaking
to make such payments, and the Trustee will use its best efforts to obtain said amounts from the Company according to the provisions of
this Section 23.

&nbsp;&nbsp;&nbsp;&nbsp;23.7. With respect to priority in reimbursement to Bondholders who bore the payments under this Section out
of the proceeds held by the Trustee, see Section 12 of the Deed.

24.  **<u>Notices</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;24.1 Any notice on behalf of the Company and/or the Trustee to the Bondholders shall be provided by way of
a report on the MAGNA System on the Israel Securities Authority website. The Trustee may instruct the Company, and the Company will be
required to Publish on the MAGNA System on behalf of the Trustee as soon as possible, any report in the form as shall be provided in writing
by the Trustee.

&nbsp;&nbsp;&nbsp;&nbsp;24.2 Any notice or demand on behalf of the Trustee to the Company or on behalf of the Company to the Trustee
may be provided by way of registered mail to the address set forth in this Deed of Trust, or to other address of which one party has notified
the other in writing, or by way of email, facsimile, or courier, and any such notice or demand will be deemed to have been received by
the addressee as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24.2.1. If by registered mail – upon the lapse of three (3) Business Days of the date on which the addressee
was invited to collect the mail according to the post office registries.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24.2.2. If by facsimile transmission (followed by telephone receipt confirmation) – upon the lapse of one
(1) Business Day of said transmission.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24.2.3. If by courier – upon delivery by the courier to the addressee or upon it being presented to the
addressee for receipt.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24.2.4. If by email – upon receipt of telephone or written confirmation whereby the message was received
by the recipient.

&nbsp;&nbsp;&nbsp;&nbsp;24.3. Copies of notices and invitations provided on behalf of the Company and/or the Trustee to the Bondholders
shall be sent by the Company to the Trustee, and by the Trustee to the Company, as applicable.

25.  **<u>Waiver and Settlement</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25.1 The Trustee may from time to time, if convinced that such action does not prejudice the Bondholders, waive
any breach or non-fulfillment by the Company of any of the terms under this Deed of Trust, provided that such action does not pertain
to changes concerning: payment terms of the Bonds (including payment dates, interest rates and linkage terms), the expense cushions, the
appointment of a representative in Israel, grounds for calling for an immediate repayment, a negative pledge, restrictions on series expansion,
the Financial Covenants, interest adjustment mechanisms, a change in the identity of the Trustee or to its remuneration, the appointment
of a Trustee in lieu of a Trustee whose term has ended, as well as with respect to reports that the Company is required to provide the
Trustee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25.2 The Trustee and the Company shall be entitled to, either before or after the outstanding Principal balance
has been called for immediate repayment, amend this Deed of Trust, reach a settlement with respect to any of the Bondholders' rights
or claims, and agree to any arrangement with respect to the Bondholders' rights, including the waiver of any of the Bondholders'
rights or claims against the Company pursuant to this Deed of Trust, if one of the following conditions is met:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25.2.1 The Trustee is of the opinion that the proposed change does not prejudice the Bondholders, provided that
such amendment does not pertain to the payment terms under the Bonds (including payment dates, interest rates and linkage terms), expense
cushions, the appointment of a representative in Israel, grounds for calling for an immediate repayment, a negative pledge, restrictions
on series expansion, the Financial Covenants, interest adjustment mechanisms, a change in the identity of the Trustee or to its remuneration,
the appointment of a Trustee in lieu of a Trustee whose term has ended, as well as with respect to reports that the Company is required
to furnish the Trustee; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25.2.2 The Bondholders have agreed to the proposed change by way of a Ordinary Resolution.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25.3 If the Trustee has reached a settlement with the Company after having obtained the Bondholders'
approval in advance, by way of a Special Resolution obtained at a Bondholders' Meeting, the Trustee shall be released from any liability
in respect thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25.4 The Trustee shall be entitled to demand that the Bondholders deliver the Bond Certificates to it or to
the Company in any instance in which the Trustee's rights pursuant to this Section 25 are exercised, in order to register a note
therein with respect to any compromise, waiver, or amendment as aforesaid, and at the Trustee's request, the Company shall record
such note.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25.5 The Trustee shall notify the Bondholders of each instance in which it exercised the Trustee's rights
pursuant to this Section 25, within a reasonable period of time thereafter, except if the Trustee exercised its right pursuant to Subsection
25.2.1, in which case the Trustee shall notify the Bondholders within a reasonable period of time prior thereof.

26.  **<u>Bondholders Register</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;26.1. The Company shall keep and maintain a Bondholders Register at its registered office, pursuant to the provisions
of the Securities Law.

The Register shall also record all transfers of registered ownership of Bonds pursuant to the provisions of this Deed of Trust. The Trustee and all Bondholder may, at any reasonable time, review the Register.

&nbsp;&nbsp;&nbsp;&nbsp;26.2. The Company shall not be required to record in the Register any notice concerning a trust, pledge or charge
of any kind whatsoever or any equitable right, claim, or offset, or any other right with respect the Bonds. The Company shall only recognize
the ownership of the Person under whose name the Bonds have been registered, provided that the Bondholder's lawful heirs, executors
or administrators of the registered Bondholder and any Person who may be entitled to the Bonds as a consequence of the liquidation of
any registered Bondholder, shall be entitled to be registered as Bondholders after providing evidence which the Company shall deem sufficient
for proving their right to be registered as the Bondholders of the relevant Bonds.

&nbsp;&nbsp;&nbsp;&nbsp;26.3. The Company undertakes to provide a copy of the Register to the Trustee immediately after the Bond Issuance.
The Company undertakes to notify the Trustee of any change or update made to the Register.

27.  **<u>Replacement of the Trustee</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;27.1 The Trustee's term of office, including the termination thereof and the appointment and the termination
of any new Trustee and the termination thereof, shall be governed by the provisions of the Securities Law, pursuant to which the Trustee
and any successor thereof shall be entitled to resign from its position as Trustee, subject to the approval of the court, and said resignation
shall enter into effect on the effective date to be set forth in said approval.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;27.2 A court may dismiss the Trustee if the Trustee has not performed its duties properly or if a court finds
another reason for its dismissal.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;27.3 A resolution to terminate the term of a Trustee and its replacement with another shall be obtained by
way of a resolution approved by 75% of the Bondholders participating in the vote (except abstentions) held at a Bondholders' Meeting
attended by Bondholders representing at least fifty percent (50%) of the Bonds in circulation or, in an adjourned meeting, attended by
Bondholders representing at least ten percent (10%) of the Bonds in circulation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;27.4 A trustee whose term has expired shall continue to serve in said capacity until its successor has been
appointed. The successor Trustee shall be appointed at a Bondholders' Meeting convened by the outgoing Trustee or by the Bondholders,
pursuant to the provisions of the foregoing Subsection 27.3.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;27.5 Any successor Trustee shall have the same powers, authorities and other permissions as the outgoing Trustee
and may act as though it were appointed as Trustee from the outset.

28.  **<u>Reports to the Trustee and to the Bondholders</u>** 

For as long as there remain Bonds in circulation, the Company shall prepare and deliver to the Trustee the following reports and notices:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;28.1 Audited annual Financial Statements, immediately upon their publication, according to the dates in which
the Company is required to publish them as a public company, under any law, even if the Company is not a Reporting Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;28.2 Reviewed quarterly Financial Statements, immediately upon their publication, according to the in which
the Company is required to publish them as a public company, under any law, even if the Company is not a Reporting Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;28.3 Notices regarding the buyback of Bonds by the Company or by a company controlled thereby, or in the event
the Company becomes aware of the purchase thereof by any other Related Holder, as set forth in Section 5 above, as well as copies of notices
to the public which the Company is required to provide pursuant to applicable law, and of any other notices and/or invitations to Bondholders'
Meetings the Company may provide to the Bondholders in its name or on behalf of the Trustee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;28.4 In the event the Company ceases to be a Reporting Corporation, any report required from a company that
is not a Reporting Corporation pursuant to the Regulation Codex, including the provisions concerning investments made by institutional
investors in non-government bonds. Any such report will be executed by the CEO (or such person fulfilling this position even if his or
her title is different) and the Company's Chief Financial Officer.

The Company's submission of the documents as required under this Section 28 on the MAGNA website of the Israel Securities Authority shall be deemed a delivery of said documents to the Trustee.

The Trustee shall be entitled, at its sole discretion, to forward to the Bondholders documents it shall receive as set forth above.

29.  **<u>Bondholders' Meetings</u>** 

Bondholders' Meetings shall be convened and held in accordance with the provisions set forth in the <u>Second Schedule</u> to this Deed of Trust.

30.  **<u>Governing Law</u>** 

All matters deriving from this Deed or associated therewith shall be interpreted solely pursuant a and subject to the laws of the State of Israel, and for as long as the Bonds are Listed, the provisions set forth in the Stock Exchange's Bylaws and Guidelines. Without derogating from the provisions of Section 1.7 above, with respect to any matter which is not addressed in this Deed and in any event of a contradiction between the cogent provisions of the applicable laws of the State of Israel and the provisions of this Deed, the parties shall act pursuant to the provisions set forth in the of the laws of the State of Israel. The competent courts of Tel Aviv - Jaffa shall have sole jurisdiction to settle any matter arising from or associated with this Deed and/or the Bonds.

The Company shall not object to any motion filed on behalf of the Trustee and/or a Bondholder which was submitted to a court in Israel in order to apply Israeli law with respect to a settlement, debt arrangement and/or insolvency concerning the Company. The Company shall not object should the Israeli court seek to apply Israeli Law with respect a settlement, debt arrangement and/or insolvency concerning the Company, and the Company shall not raise arguments against Israeli jurisdiction with respect to proceedings initiated by the Trustee and/or the Bondholders as set forth above.

31.  **<u>Trustee's Responsibility</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;31.1 Notwithstanding what is stated in any law and anywhere in the
Deed of Trust, insofar as the Trustee acted to fulfill its duty in good faith and within a reasonable time and also examined the facts
that a reasonable Trustee would have examined under the circumstances, it shall not be liable for damages caused, unless a final ruling
resolved that the Trustee acted with gross negligence. It is clarified that to the extent that a contradiction arises between the provision
of this Section and another provision of the Deed of Trust, the provision of this Section shall prevail.

&nbsp;&nbsp;&nbsp;&nbsp;31.2 If the Trustee acted in good faith and without negligence in
accordance with the provisions of Section 35H(d2) or 35H(d3) of the Law, it shall not be liable for performing said action.

32.  **<u>Addresses</u>** 

The addresses of the parties are as set forth in the preamble to this Deed, or any other address in respect of which appropriate written notice is provided to the other party.

**In witness whereof the parties have hereunto signed:**

---

| | |
|:---|:---|
| **UMH PROPERTIES, INC** | **Resnik Paz Nevo Trusts Ltd.** |
| I the undersigned, Adv. ___________ hereby confirm that this Deed of Trust was signed by **UMH PROPERTIES, INC** ("**UMH**"), by ______________, and their signatures bind UMH in all respects. | I the undersigned, ______ hereby confirm that this Deed of Trust was signed by ____**,** and that their signatures bind **Resnik Paz Nevo Trusts Ltd.** (the "**Trustee**"), in all respects. |
| **______________, Adv.** | **______________.** |

---

**<u>UMH PROPERTIES, INC</u>**

**<u>The First Schedule</u>**

**<u>Bond Certificate</u>**

NIS **___**, Bonds (Series B)

The Principal of the Bonds shall be repaid in one installment, on June 30, 2030.

The Bonds shall bear fixed annual (unlinked) interest at a fixed rate of 5.85% (but subject to adjustments upon a change in the rating of the Bonds (Series B) and/or the Company's failure to comply with the financial covenants set out in Sections 7.1 and 7.2 below). The interest shall be payable in semiannual installments at the end of each period, on December 31, 2025, and on June 30 and December 31 of each of the years 2026-2029 (inclusive) and on June 30, 2030 (each, an "**Interest Payment Date**"), for the six (6) month period commencing on the previous Interest Payment Date and ending on the day immediately preceding the applicable Interest Payment Date (the "**Interest Period**"), except for the First Interest Payment Date, which shall be December 31, 2025, for the period commencing on the first Trading Day after the Public Tender Date and ending on the day immediately preceding the First Interest Payment Date (the "**First Interest Period**") and which shall be calculated on the basis of 365 days in a year and the actual number of days in such period.

Registered Holder of this Bond: ______________ (the "**Bondholder**" or "**Holder**")

Certificate Number: _______.

Par value of Bonds subject to this Certificate: __________.

Interest: 5.85 % per annum

This certificate witnesses that **UMH PROPERTIES, INC.** (the "**Company**") shall pay to the Holder or to whomever is the registered as the Holder of this Bond the amount it has undertaken, all subject to the remaining provisions set forth in the Terms and Conditions Overleaf.

The final interest payment shall be paid on June 30, 2030, together with the final Principal repayment and against the delivery of the Bond Certificates to the Company and/or to any third party as instructed by the Company.

All the Bonds in this series are not secured by any collateral and will rank *pari passu* among themselves, without any single Bond having preference or priority over the other. This Bond is being issued subject to the conditions set forth in the Terms and Conditions Overleaf and the conditions set forth in the Deed of Trust between the Company and Resnik Paz Nevo Trusts Ltd. (the "**Trustee**"), dated July 18, 2025 (the "**Deed of Trust**").

Signed by the Company on **___**

By: ___________________

Name: **________**_

Title: _____________

**<u>TERMS AND CONDITIONS OVERLEAF</u>**

1.  **<u>General</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1 In this Bond, terms and expressions shall have the meanings prescribed thereto in the Deed of Trust, unless
otherwise explicitly stated

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2 The provisions of the Deed of Trust with respect to the Bond Certificate (including the Terms and Conditions
Overleaf) shall be deemed explicitly incorporated in the conditions of these Bonds.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3 The Bonds shall rank *pari passu* to the other Bonds in the same series, without any Bond having
priority over another.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.4 In case of a contradiction between the provisions set forth in the Deed of Trust and those of the Terms
and Conditions Overleaf, the Deed of Trust shall prevail.

2.  **<u>Repayment of the Bonds; Interest</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1 <u>Repayment of the Bonds</u> 

The Principal on the Bonds shall be repaid in one installment, on June 30, 2030.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2 <u>Interest</u> 

The Bonds shall bear fixed annual (unlinked) interest at a fixed rate of 5.85%but subject to adjustments upon a change in the rating of the Bonds (Series B) and/or the Company's failure to comply with the financial covenants set out in Sections 7.1 and 7.2 below). The interest shall be payable in semi-annual installments at the end of each period, on December 31, 2025, and on June 30 and December 31 of each of the years 2026-2029 (inclusive) and on June 30 2030 (each, an "**Interest Payment Date**"), for the six (6) month period commencing on the previous Interest Payment Date and ending on the day immediately preceding the applicable Interest Payment Date (the "**Interest Period**"), except for the First Interest Payment Date, which shall take payable on December 31, 2025, for the period commencing on the first Trading Day following the Public Tender and ending on the day immediately preceding such First Interest Payment Date (the "**First Interest Period**"), which shall be calculated on the basis of 365 days in a year and the actual number of days in such period.

3.  **<u>Payments of Principal and Interest on the Bonds</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1. **Record Date** – Payments on account of the Principal and/or any Interest thereon shall be paid to the relevant Bondholder
on the following dates:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1.1. Payments due on December 31 shall be made to those holding Bonds as at the end of the Trading Day on December
19. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1.2. Payments due on June 30 (excluding the final payment of Principal and Interest) shall be made those holding
Bonds as at the end of the Trading Day on June 18.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1.3. The final payment of Principal and Interest shall be made against the delivery of the Bond Certificates
to the Company, on the payment date, at a location in Israel as the Company shall instruct the Trustee, no later than five (5) Business
Days prior to the last payment date.

In the event any payment date on account of Principal and/or Interest is not a Business Day, the payment date shall be postponed to the following Business Day and no interest or other payment shall be due on account of such delay, and the record date for determining the eligibility for redemption or interest shall not be changed as a result of such postponement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2 The repayment of the Principal (whether scheduled, upon calling for an immediate repayment or upon an
early redemption) and interest payments on the outstanding Principal balance, shall be made to the Bondholders in NIS, linked to the Dollar,
as follows: (i) if the Payment Rate is higher than the Base Rate, then such payment in NIS shall be increased proportionately to the rate
of increase of the Payment Rate compared to the Base Rate; (ii) if the Payment Rate is lower than the Base Rate, then such payment in
NIS shall be reduced proportionately to the rate of decrease of the Payment Rate compared to the Base Rate e; and (iii) if the Payment
Rate is equal to the Base Rate, then such payment shall be made in the NIS amount originally determined. Pursuant to the Stock Exchange
Guidelines, the linkage method cannot be modified.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3 Payment to a Registered Bondholder will be made by check or wire transfer in favor of said persons whose
names are registered in the Register or those who delivered the Bond Certificates in accordance with Subsection 2.3 above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.4 The Bondholder will inform the Company of its bank account information for crediting the payments to which
said Bondholder is entitled under the Bonds, or of any change in said information or in the Bondholder's address, as applicable,
by way of a written notice sent to the Company via registered mail. The Company will be obligated to act according to the Bondholder's
notice with respect to such change, provided said notice was received after thirty (30) Business Days have elapsed as of the date in which
the Bondholders' notice reached the Company. If a Bondholder who is entitled to payment as aforesaid fails to duly provide the Company
with information pertaining to its bank account, then each payment on account of the Principal and/or Interest shall be made by way of
a check sent via registered mail to its last known address as recorded in the Register. The sending of a check to a registered Holder
via registered mail in accordance with the foregoing shall be deemed, for all intents and purposes, as payment of the amount stated therein
on the date in which it was sent via post, unless it was not cleared when duly presented for at the time of its lawful presentation for
collection.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.5 A Bondholder wishing to alter the payment instruction it has provided may do so by providing notice sent
by registered mail to the Company's registered office, and the Company shall comply with such instructions only if they have been
received at the Company's registered office at least 30 days prior to the record date for an applicable payment. In the event such
instructions are received after such day, the Company shall act according to said instructions with respect to subsequent payments.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.6 Tax shall be withheld from each payment made by the Company to the Bondholders as required under applicable
law, unless the Bondholders have provided the Company with a valid withholding tax exemption from the applicable tax authority, in a form
satisfactory to the Company. The Company shall be entitled to rely on the information provided to it by the Nominee Company and which
appears in the register maintained by the Stock Exchange Clearing House with respect to Bondholders entitled to payment, including information
pertaining to the scope of their holdings in the Bonds and the interest to which they are entitled on any applicable Interest Payment
Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.7 Payment to an unregistered Bondholder will be made through the Tel Aviv Stock Exchange Clearing House.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.8 Any payment on account of Principal and/or interest thereon that is paid at a date exceeding seven (7)
days after the date scheduled for its repayment under the Bonds, for reasons within the Company's control, shall bear an additional
default interest for the delay period at an annual interest rate of four percent (4%) ()"**Default Interest** "), which shall
be added to the interest borne by the Bonds at said time. If applied, the additional interest will be calculated from the date scheduled
for the repayment. The Company shall issue an Immediate Report in the MAGNA System and/or on the Maya website, stating the exact rate
including any Default Interest, no later than two (2) Business Days after such additional interest will apply to the Bonds.

4.  **<u>Failure to Make a Payment for Reason Beyond the Company's Control</u>** 

See Section 14 to the Deed of Trust.

5.  **<u>Bondholders Register</u>** 

See Section 26 to the Deed of Trust.

6.  **<u>Transfer and Split of Bond Certificates</u>** 

The Bonds are transferrable with respect to any par value amount, provided that it will be in whole New Israeli Shekels. Any transfer of Bonds (excluding a transfer executed by way of trading on the Stock Exchange or a transfer between Bondholders held by a Stock Exchange member) will be carried by way of a deed of transfer in a standard form for transferring securities, duly signed by the registered Bondholder (or its lawful representative) and by the transferee (or its lawful representative), which shall be delivered to the Company at its registered office, together with the Bond Certificate(s) transferred thereby and any other reasonable poof required by the Company in order to evidence the transferor's right to carry out said transference.

The transferring party shall provide the Company with reasonable evidence concerning the settlement of any payment required under applicable law in order to carry out the transference.

In the event whereby only part of the Principal amount set forth in the Bond Certificate is transferred, the Bond Certificate should first be split into several certificates, in the manner specified below.

After the fulfillment of all such conditions, the transfer will be registered in the Register and the transferee shall be bound by the terms specified in the Deed of Trust and in the Bond certificate and will be deemed a "Bondholder" for purposes of the Bond.

Each Bond certificate may be split into several new certificates and the total Principal amounts stated thereon shall be equal to the par value Principal amount of the Bond certificate subject to such split, provided that the new certificates shall each have par value amounts in whole NIS. The split will be carried out against the delivery of said Bond certificate to the Company at its registered office in order to carry out the split. All expenses associated with splitting of Bonds, including any stamp duty and other fees, if any, shall apply to the person requesting the split.

7.  **<u>Early Redemption</u>** 

See Section 9 to the Deed of Trust.

8.  **<u>Bond Buyback</u>** 

See Section 5 to the Deed of Trust.

9.  **<u>Additional Issuances</u>** 

See Section 2.9 to the Deed of Trust.

10.  **<u>Waiver and Settlement</u>** 

See Section 25 to the Deed of Trust.

11.  **<u>Bondholders' Meetings</u>** 

Bondholders' Meetings shall be convened and conducted in accordance with the provisions of <u>Second Schedule</u> to the Deed of Trust.

12.  **<u>Receipts as Proof</u>** 

See Section 15 to the Deed of Trust.

13.  **<u>Replacing Bond Certificates</u>** 

If a Bond certificate become worn, is lost, or destroyed, the Company may issue a new certificate *in lieu* thereof, under the same terms and conditions, provided that in the event the Bond certificate becomes worn, the worn Bond certificate shall be returned to the Company before the new certificate is issued. Any levies, taxes and other expenses associated with the issuance of the new certificate shall be borne by the person requesting said certificate.

14.  **<u>Calling for an Immediate Repayment</u>** 

See Section 10 to the Deed of Trust.

15.  **<u>Notices</u>** 

See Section 24 to the Deed of Trust.

**<u>UMH PROPERTIES, INC</u>**

**<u>Second Schedule</u>**

**<u>General Meetings of Bondholders</u>**

In any event that a different and/or supplementary mechanism for convening and/or holding of a Bondholders' Meeting shall be prescribed under any applicable law, including pursuant to the Stock Exchange's bylaws and guidelines, the provisions of this Schedule shall be automatically adjusted to the provisions of the law, to the extent the provisions of such law so mandate.

Without derogating from any other provision under applicable law or under the Deed of Trust, the following provisions shall apply to Bondholders' Meetings:

**<u>Convening Bondholders' Meetings</u>**

1. The Trustee, if it deems it necessary, if required by law or if requested by the Company, will convene
a Bondholders' Meeting at the Company expense.

2. The Trustee shall convene a Bondholders' meeting if it deems it necessary or at the request of the
Company, and shall be obligated to convene such a meeting at the request of one or more Bondholders holding at least 5% of the outstanding
unpaid nominal value of the principal of the Bonds in circulation (the **"Holder"** or the **"Holders"**).
In the event that the request to convene the meeting is made by the Holders, the Trustee may require the requesting parties to indemnify
it for the reasonable expenses incurred in connection therewith. Nothing in this section shall derogate from the provisions of Section
10.2.1 of the Deed of Trust and the Trustee's obligations thereunder. The agenda of such meeting will include the subject which
was requested by said Bondholder and may include additional items at the discretion of the Trustee. The Trustee may demand the Bondholders
requesting the meeting to reimburse it for the reasonable expenses in connection therewith. For the avoidance of doubt, the Trustee's
demand for reimbursement shall not prejudice the convening of a meeting called in order to take action aimed at preventing of a breach
of the Bondholders' rights. It is noted that the Trustee's demand for reimbursement will not constitute a condition for convening
a Bondholders' Meeting required in order to protect the Bondholders' rights and will not derogate from the Company's obligation the bear
the costs of such meeting.

3. If the Trustee convenes a Bondholders' Meeting, it will convene it by publishing an invitation in
an Immediate Report on the MAGNA and/or Maya System. This invitation will include notice of the place, date, and time for the meeting,
as well as the agenda and the matters to be discussed therein.

4. The Trustee shall convene a Bondholders' Meeting pursuant to Section 2 above on a date not earlier than
seven (7) days and not later than twenty-one (21) days from the date on which the Bondholders' request was submitted thereto; nevertheless,
the Trustee may convene a Bondholders' Meeting on an earlier date if it believes that it is required in order to protect the Bondholders'
rights and subject to the provisions of Section 7 below. In such case, the Trustee shall specify in the convening notice for such meeting
the reasons for convening the Bondholders' Meeting at an earlier date.

5. If the Trustee failed to convene a Bondholders' Meeting upon the request of a Bondholder entitled thereto
within the aforementioned period, the Bondholder may convene a Bondholders' Meeting, provided that the meeting shall take place
on a date that is within fourteen (14) days from the end of the period in which the Trustee was required to convene such meeting, and
the Trustee shall bear the expenses incurred by the Bondholder with respect to the convening thereof.

6. Notwithstanding the foregoing, it is possible to convene a Bondholders' Meeting only for the purpose of
consultation and/or reporting, with a one-day prior notice (or more). No Bondholders' resolutions will be adopted in such meeting ()"**Consultation Meeting** ").

7. The Trustee is authorized to reschedule any Bondholders' Meeting. If a Bondholders' Meeting was
not convened as set forth in Section 2 above or as set forth in Section 35B(a1) of the Securities Law, the court shall be entitled, at
the request of a Bondholder, to order the convening thereof. In the event the aforesaid court order is granted, the Trustee shall bear
the reasonable expenses incurred by the requesting Bondholder associated with obtaining said court order, in the amount determined by
the court.

8. The court may, at the request of a Bondholder, order the revocation of a resolution adopted at a Bondholders'
Meeting that was convened or conducted without complying with the terms prescribed therefor under applicable law or under the Deed of
Trust. In case the fault pertains to the place or the time in which the Bondholders' Meeting is convened, as set forth in the convening
notice, a Bondholder who attended said meeting, notwithstanding the fault, may not demand the revocation of the resolution.

9. Each Bondholders' Meeting shall take place at the Company's registered office in Israel, or
at another address to be determined by the Company, provided that said address is in Israel.

**<u>Record Date; Proof of Ownership</u>**

10. The record date with respect to ownership of Bonds in order to establish the Bondholders' entitlement
to participate and vote at the Bondholders' Meeting shall be the date set forth in the notice of the Bondholders' Meeting.
The record date shall be determined by the Trustee subject to the law, which currently provides that such date shall be no less than three
(3) Trading Days prior to the date on which Bondholders' Meeting is held, and no more than fourteen (14) days prior to the date
of said meeting.

11. A Bondholder wishing to vote at a Bondholders' Meeting is entitled to receive from the Stock Exchange
member by which the Bonds are held, a confirmation of its ownership of the Bonds. The Bondholder shall deliver to the Trustee at its registered
office in Israel or through the ISA's electronic voting system (or in any other way which will be specified in the invitation), no later
than the date as determined by the Person calling the Bondholder Meeting in the meeting invitation, said confirmation specifying the number
of Bonds held by the Bondholder as of the date specified in said certificate, together with a power of attorney if such ownership confirmation
does not indicate the name of the person participating at the meeting.

**<u>Meeting Chairperson</u>**

12. The Trustee or a person appointed thereby shall serve as the Chairman of the Bondholders' Meeting.

**<u>Legal Quorum; Adjourned Meeting</u>**

13. The Bondholders' Meeting will commence after it has been confirmed that the legal quorum required
for holding a discussion in respect of any of the items on the meeting's agenda is present. In the Bondholders' Meeting, only
resolutions which were included in the meeting's agenda will be put to a vote, provided that the legal quorum required for adoption thereof
is present as further provided below.

14. The presence of Bondholders (one or more) irrespective of the amount of voting rights held thereby will
constitute a legal quorum in a Consultation Meeting. The legal quorum required in order to adopt an Ordinary Resolution shall be the presence
of two or more Bondholders, present in person or by proxy within half an hour as of the time prescribed for the beginning of the Bondholders'
Meeting, jointly holding or representing at least twenty five percent (25%) of the voting rights assigned to the Bonds except with respect
to resolutions for which a different quorum is required under applicable law or under the Deed of Trust.

15. If a legal quorum shall not be present within half an hour from the time prescribed for the beginning
of a Bondholders' Meeting, such meeting shall be adjourned to another date which shall be no earlier than two (2) Business Days
after the date prescribed for the convening of the original meeting or, if the Trustee believes that the Bondholders' Meeting is
required in order to protect the Bondholders' rights, not earlier than one (1) Business Day after the date prescribed for the convening
of the original meeting. In the event the Bondholders' Meeting was adjourned, the Trustee shall specify the reasons therefor in
the notice announcing the new time and place of the adjourned Bondholders' Meeting.

16. If a legal quorum shall not be present at an adjourned Bondholders' Meeting within half an hour
from the time prescribed for the beginning thereof, such meeting shall be held with any number of participants, unless otherwise provided
by applicable law or the Deed of Trust. Notwithstanding the foregoing, if the Bondholders' Meeting was convened at the request of
Bondholders as set forth in Section 2 above, the adjourned Bondholders' Meeting may be held only if the number of Bondholders required
thereunder for convening a Bondholders' Meeting is present.

17. The presence of Bondholders, in person or by proxy, within half an hour from the time prescribed for the
beginning of the Bondholders' Meeting, and jointly holding or representing at least fifty percent (50%) of the outstanding balance
of the par value of the Bonds in circulation, shall constitute a legal quorum at any Bondholders' Meeting on the agenda of which there
exists a proposal to approve a Special Resolution. If, within half an hour of the time from the time prescribed for the beginning of such
meeting, a legal quorum shall not be present, such meeting shall be adjourned and the provisions of Section 12 above shall apply, *mutatis mutandis*. At a Bondholders' Meeting on the agenda of which there exists a proposal to approve a Special Resolution which was
adjourned, the presence of at least two or more Bondholders, present in person or by proxy, jointly holding or representing at least twenty
percent (20%) of the outstanding balance of the par value of the Bonds in circulation, shall constitute a legal quorum.

18. A Related Holder shall not be counted for purposes of determining the presence of a legal quorum required
to open a Bondholders' Meeting (including any adjourned meeting) and will not be entitled to exercise the voting rights inherent
in the Bonds held by it.

**<u>Continued Meeting</u>**

19. The majority of Bondholders at a Bondholders' Meeting in which a legal quorum is present, or the
Trustee, may resolve to postpone the continuation of the Bondholders' Meeting, including any discussion or adoption of a resolution
with respect to a matter specified in the agenda of such meeting, to another date and place to be determined (a "**Continued Meeting** ").
At a Continued Meeting, only such matter which was on the agenda of the original Bondholders' Meeting and with respect thereof a
resolution was not previously adopted shall be addressed. In the event that the Bondholders' Meeting was adjourned without amending
its agenda, notification regarding the date of the new meeting shall be provided as soon as possible, but in any event no later than twelve
(12) hours prior to convening the new Bondholders' Meeting. Notice of such a meeting shall be issued in accordance with the provisions
of Section 31 below.

**<u>Vote; Required Majority</u>**

20. Any Bondholder which is present, in person or by proxy, at a Bondholders' Meeting, is entitled to
one vote for every NIS 1 par value of the Principal of the Bonds held thereby, subject to the provisions of the Deed of Trust. The Trustee
shall participate at Bondholders' Meetings, without any voting rights.

21. In the event that Bonds are jointly held by two or more Bondholders, only the vote of the Bondholder listed
first in the Register of the same Bond series and wishing to vote either in person or by proxy, will be counted.

22. A resolution at a Bondholders' Meeting will be decided based on a tally of votes.

23. Resolutions shall be adopted at Bondholders' Meetings by a simple majority out of all participating
votes, excluding abstentions, unless a different majority is prescribed under applicable law or under the Deed of Trust, or if the Trustee
resolved, pursuant to the authority granted to it under the Deed of Trust, that a resolution shall be adopted by a majority which is not
a simple majority. The adoption of a Special Resolution at a Bondholders' Meeting shall require a majority of at least two thirds
(2/3) of all of the participating votes, excluding abstentions.

24. The Chairman's announcement regarding the adoption or rejection of a resolution and the recording
thereof in the meeting's minutes, will serve as *prima facie* evidence of its adoption or rejection as aforesaid.

25. A Bondholder may vote in Bondholders' Meetings by itself or via proxy and also by way of a written
ballot in which he shall state the manner of its vote, as specified in Section 28 below. A proxy appointing letter shall be made in writing
and signed by the appointer or by its representative, who has been authorized in writing to do so. If the appointer is a corporation,
the appointing shall be made in writing, the corporate stamp shall be placed thereupon alongside the signature of an Officer or an attorney
representing the corporation who is authorized to do so. The proxy appointing letter may be drawn-up in any standard form. A proxy does
not have to be a Bondholder.

26. A proxy appointing letter and a power of attorney pursuant to which the appointing form was signed, or
a certified copy thereof, shall be delivered to the Trustee's registered office in Israel (or as will be instructed in the invitation)
no later than the date as shall be determined by the Person convening the Bondholders' Meeting and as set forth in the meeting's
convening notice, unless otherwise determined by the Trustee. The proxy appointing letter will be valid for any adjourned meeting of the
meeting referred to in the proxy appointing letter, unless otherwise provided therein.

27. A vote cast in accordance with the provisions set forth in the proxy appointing letter shall be valid
even if prior thereto, the appointer has passed away or was declared legally incompetent, or if the proxy appointing letter was revoked
or the Bonds with respect to which the vote was granted were transferred.

28. A Bondholder or its proxy may cast a portion of its votes in favor of a certain proposal, and a portion
against, and abstain in respect of others, all as he deems fit.

**<u>Minutes</u>**

29. The Trustee will record minutes of the Bondholders' Meetings and shall keep a copy of such at its
registered office for a period of seven (7) years following the date of such meeting. Minutes executed by the Chairman of the meeting
shall serve as *prima facie* evidence of the contents recorded therein. The Trustee shall maintain at its registered office a register
containing the minutes recorded at Bondholders' Meetings, which shall be open for the Bondholders' and the Company's
review (with respect to the part of the meeting in which only the Company's representatives were present) and a copy thereof shall be
sent to any Bondholder at its request.

**<u>Written Ballot</u>**

30. Bondholders may vote at Bondholders' Meetings by way of a written ballot. A written ballot shall
be Published by the Trustee in the MAGNA or Maya system and will specify the deadline for voting. A Bondholder may state the manner of
its vote in the written ballot and send it to the Trustee. Subject to applicable law, each Bondholder is entitled to receive a written
ballot from the Stock Exchange member by which its Bonds are held. Voting by way of a written ballot, shall be subject to the following
conditions: (i) the written ballot shall be delivered to the place, at the dates and to the persons as shall be set forth in the notice
of the Bondholders' Meetings and/or in the written ballot, and (ii) the written ballot shall be completed, duly signed and accompanied
by all of the required documents attached thereto. A written ballot in which the Bondholder has set forth the manner in which he wishes
to vote and was received by the Trustee prior to the last day scheduled therefor, shall be counted for determining a legal quorum. A written
ballot received by the Trustee in respect of a certain matter which was not voted on at a Bondholders' Meeting shall be considered
as abstaining from the vote at such meeting in respect of a resolution to hold a Continued Meeting according to the provisions of Section
16 above, and shall be counted at the adjourned Bondholders' Meeting to be held pursuant to the provisions of Sections 13 or 16
above. A written ballot which was submitted without the relevant documents or which was not duly completed or signed, will be disqualified
from the voting.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;31. The trustee may require a holder to declare within the framework of a written ballot the existence or
absence of a conflicting interest that he has, and a Holder who will not complete the written ballot in full and/or who does not prove
its eligibility to attend and vote at the meeting under the Second Schedule, shall be deemed as one who did not provide a written ballot
and chose not to vote on the matters(s) set forth in the written ballot. A Bondholder who declares that he has a conflicting interest
will be considered as instructing the Trustee not to count its vote in the vote (but to count them for the purpose of the legal quorum).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;32. The Trustee shall be entitled, at its discretion and subject to any law, to hold voting meetings at which
votes shall be held by way of written ballots and without convening the holders, and to hold votes by written ballot at a voting meeting
(including at its adjourned meeting) at the opening of which the legal quorum required to adopt the resolution on the agenda was not present,
provided that the Trustee obtained, by the closing of the voting meeting, as set forth in the notice for convening the meeting or holding
a vote, as applicable, written ballots from Bondholders constituting a legal quorum required to adopt a resolution in the original or
adjourned meeting, as applicable.

**<u>Presence</u>**

33. A person or persons appointed by the Trustee may be present but shall not be entitled to vote at Bondholders'
Meetings. The Company's representatives and any other person or persons permitted by the Trustee may be present, with no voting rights.
In the event that, at the Trustee's discretion, part of a Bondholders' Meeting calls for a discussion in the absence of a
certain person, including the Company's representatives, such person shall not participate in said part of the discussion.

**<u>Meeting Notice; Agenda</u>**

34. The Trustee shall determine the agenda for a Bondholders' Meeting and shall include therein the
matters in respect of which the convening of the Bondholders' Meeting was required pursuant to Section 2 above and any issue requested
by a Bondholder as specified in Section 33 below. The Bondholders at a Bondholders' Meeting shall only adopt resolutions in respect
of matters specified on the agenda. Notwithstanding the foregoing, the Bondholders at a Bondholders' Meeting may adopt resolutions
that differ in wording from the resolutions on the agenda, according to the provisions of applicable law.

35. One Bondholder or more, holding at least five percent (5%) of the outstanding balance of the par value
of the Bonds, may request that the Trustee include a certain matter on the agenda of a Bondholders' Meeting that shall be convened
in the future, provided that such matter is appropriate for discussion at said meeting, subject to applicable law.

**<u>Additional Provisions</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;36. Nothing stated in Sections 2, 32 and 33 above shall derogate from the Trustee's authority to convene
a Bondholders' Meeting if it deems it necessary in order to consult with the Bondholders. Notice of such a Bondholders' Meeting
need not specify the matters on its agenda, and the date of such meeting shall be at least one day after the date on which notice thereof
was given. No vote shall be held, and no resolutions shall be adopted, at such meeting and the provisions of the Securities Law shall
apply thereto, other than the provisions specified in Section 35(12)26 of the Securities Law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;37. If it is not possible to convene a Bondholders' Meeting or to hold such meeting in the manner prescribed
by the Deed of Trust or by the Securities Law, a court may, at the request of the Company, a Bondholder entitled to vote at a Bondholders'
Meeting or the Trustee, order that a Bondholders' Meeting be convened and held in a manner determined by the court, and the court
shall be entitled to set forth additional instructions for such purpose to the extent deemed fit thereby.

No resolution duly adopted at a Bondholders' Meeting convened in accordance with this Schedule shall be revoked, even if due to an error, notice thereof was not provided to all Bondholders, or if such notice was not received by all of the Bondholders, provided that notice of such meeting (or the adjourned meeting, as applicable) was Published on the MAGNA website of the Israel Securities Authority.

**<u>Announcing the of Decision</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;38. The Chairman's announcement that a resolution at a Bondholders' Meeting has been adopted or
rejected, either unanimously or by a certain majority, shall be *prima facie* evidence of what is stated therein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;39. This Schedule will be subject to the Securities Regulations (Voting in Writing, Position Statements and
Proof of Ownership in Bonds for the Purpose of Voting at a Bondholders Meeting), 5775-2015.

**<u>UMH PROPERTIES, INC</u>**

**<u>Third Schedule</u>**

**<u>Urgent Representation of the Bondholders</u>**

With respect to the Bonds, inasmuch as an Urgent Representation of the Bondholders is appointed, the Company undertakes that the Urgent Representation shall be appointed to act in accordance with the relevant provisions set forth in the Regulation Codex, as amended and updated from time to time, and the Company further undertakes to fully cooperate with the Urgent Representation and with the Trustee as necessary for them to conduct the investigations required by them and to formulate the Urgent Representation's decisions and to provide the Urgent Representation with any information and documents required by them with respect to the Company.

**1.**  **<u>Appointment; term of tenure</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1 The Trustee shall appoint and convene an Urgent Representation from amongst the Bondholders, as specified
below (the "**Urgent Representation** "), at its own initiative or upon receiving the Company's written request to
do so.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2 The Trustee shall appoint to the Urgent Representation the three (3) Bondholders which, based on information
provided by the Company, hold the highest par value of outstanding Bonds amongst the Bondholders and which declare that the following
conditions are true in respect of them (the "**Members of the Urgent Representation** "). In the event any of the aforementioned
Bondholders are not able to serve as Members of the Urgent Representation, the Trustee shall appoint in lieu thereof the Bondholder holding
the next highest par value of outstanding Bonds and for which all of the conditions specified hereunder hold true:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2.1 The Bondholder is not in a material conflict of interest due to the existence of any additional material
matter conflicting with the matter deriving from his service on the Urgent Representation and his holding the Bonds. For avoidance of
doubt, a Holder who is a Related Holder (as defined in Section 5.2 to the Deed of Trust) shall be deemed to be in a material conflict
of interest as aforementioned and shall not serve as a Member of the Urgent Representation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2.2 In the course of the same calendar year, the Bondholder does not serve on similar representations in respect
of other bonds with an aggregate value exceeding the percentage out of the asset portfolio managed thereby that was determined as the
maximum percentage permitting service on an urgent representation under the directives of the Commissioner of the Anti-Trust Authority
(" **the Commissioner**") which apply to the establishment of urgent representations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3 If during the service of the Urgent Representation, one of the
conditions set forth in Subsection 1.2.1 to 1.2.2 above shall have ceased to hold true with respect to any of its members, the term of
such member shall expire and the Trustee shall appoint another member in lieu thereof from amongst the Bondholders as set forth in Section
1.2 above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.4 Prior to appointing the Members of the Urgent Representation, the Trustee shall receive from the candidates
for service as Members of the Urgent Representation, a declaration regarding the existence or absence of material conflicts of interest
as set forth in Subsection 1.2.1 above, and regarding service on additional urgent representation as set forth in Subsection 1.2.2 above.
In addition, the Trustee shall be entitled to demand such declaration from Members of the Urgent Representation at any time during the
term of the Urgent Representation. A Holder who fails to provide such declaration shall be deemed to have a material conflict of interest
or to be prohibited from serving by virtue of the Commissioner's directives, as applicable. With respect to the declarations regarding
conflict of interests, the Trustee shall examine the existence of the conflicted interests, and if necessary, decide whether the conflict
of interests disqualifies such Holder from serving on the Urgent Representation. It is hereby clarified that the Trustee shall rely on
such declarations and shall not conduct examinations or other independent investigations. Subject to applicable law, the Trustee's
determination in these matters shall be final.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.5 Immediately after the appointment of the Urgent Representation, the Trustee shall notify the Company thereof
and shall set forth the names of the members serving thereon.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.6 The term of the Urgent Representation shall end on the date on which the Company shall publish the decisions
made by the Urgent Representation with respect to granting an extension to the Company for the purpose of its compliance with the terms
under the Deed of Trust as detailed in Section 1.7 below. The Company shall make public all of the information provided to the Urgent
Representation upon the termination of the Urgent Representation's term.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.7 The Company shall Publish an Immediate Report immediately after the appointment of the Urgent Representation,
stating the appointment of the Urgent Representation, the identity of its members and the powers vested therein. In addition, the Company
shall Publish an Immediate report regarding the decisions made by the Urgent Representation.

**2.**  **<u>Authority</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1 The Urgent Representation shall have authority to grant a one-time extension to the Company with respect
to the dates by which the Company must comply with any of the Financial Covenants set forth in Sections 6.1 and 6.2 of the Deed of Trust,
until the earlier of (i) a period of additional ninety (90) days; or (ii) the date of publication of the Company's next consolidated,
audited or reviewed (as the case may be) Financial Statements which the Company must publish by such date. It is clarified that the period
until the appointment of the Urgent Representation shall be taken into account within the framework of such extension and shall not constitute
grounds for the granting any additional extension to the Company beyond the aforementioned period. It is further clarified that the operation
of the Urgent Representation and cooperation among its members shall be limited to the discussion of granting such extension, and no other
information which does not concern the granting of such extension shall be transferred among the members of the Urgent Representation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2 If an Urgent Representation is not appointed according to the provisions of this Schedule, or if the Urgent
Representation resolved not to grant the Company an extension as set forth in Section 2.1 above, the Trustee shall act pursuant to the
provisions set forth in Section 10.2 to the Deed of Trust.

**3.**  **<u>Company Undertakings</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1 The Company undertakes to provide the Trustee with all of the information in its possession or which it
can obtain regarding the identity of the Bondholders and the scope of their holdings. In addition, the Trustee shall act to receive such
information in accordance with powers granted hereto by law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2 Furthermore, the Company undertakes to fully cooperate with the Urgent Representation and with the Trustee
as shall be necessary to allow them to conduct the investigations required thereby and formulate the Urgent Representation's resolution,
as well as to provide the Urgent Representation with any information and documents required thereby with respect to the Company, subject
to the restrictions of the law. Without derogating from the generality of the foregoing, the Company shall provide the Urgent Representation
with information relevant for it to arrive at a conclusion and shall not include any misleading or incomplete information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3 The Company shall bear all of the expenses of the Urgent Representation, including expenses with respect
to the engagement of advisors and experts by, or on behalf of, the Urgent Representation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.4 The appointment of the Urgent Representation or its operation shall by no means prejudice the powers granted
to the Trustee according to the law and to the Deed of Trust and they will not limit the Trustee in its actions under the law and under
the Deed of Trust.

**4.**  **<u>Liability</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1 The Urgent Representation shall act on and resolve on the matters at hand, at its sole and absolute discretion,
and shall not be liable, nor shall any of its members or their officers, employees or advisors be liable, and the Company and the Bondholders
hereby exempt them, with respect to any lawsuit, demand or claim raised against them due to their using, or failing to use, the powers,
authorities or discretion conferred thereupon pursuant to the Deed of Trust and this Schedule and in connection therewith or for any other
action carried out thereunder, unless they acted maliciously and/or in bad faith.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2 The indemnity provisions set forth in Section 23 of the Deed of Trust shall apply to actions of the Members
of the Urgent Representation and any person acting on their behalf as if they were the Trustee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3 Nothing stated shall derogate from the powers of the Trustee to convene a General Meeting of the Bondholders
and to set forth on its agenda any matter it deems fit under the circumstances, including the calling for immediate repayment. If such
General Meeting was convened and any resolutions were adopted thereby, the resolutions of the General Meeting shall override the resolutions
adopted by the Urgent Representation.

\*\*\*

## Exhibit 10.1

**Exhibit 10.1**

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## Exhibit 31.1

**Exhibit 31.1**

**CERTIFICATION**

I, Samuel A. Landy, certify that:

1. I have reviewed this quarterly report on Form 10-Q of UMH Properties, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 6, 2025

---

| |
|:---|
| */s/ Samuel A. Landy* |
| Samuel A. Landy |
| President and Chief Executive Officer |

---

## Exhibit 31.2

**Exhibit 31.2**

**CERTIFICATION**

I, Anna T. Chew, certify that:

1. I have reviewed this quarterly report on Form 10-Q of UMH Properties, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 6, 2025

---

| |
|:---|
| */s/ Anna T. Chew* |
| Anna T. Chew |
| Executive Vice President and Chief Financial Officer |

---

## Ex-32

**Exhibit 32**

**CERTIFICATION OF CEO PURSUANT TO** 

**18 U.S.C. SECTION 1350,** 

**AS ADOPTED PURSUANT TO** 

**SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

In connection with the Quarterly Report on Form 10-Q of UMH Properties, Inc. (the "Company") for the quarterly period ended June 30, 2025 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), Samuel A. Landy, as President and Chief Executive Officer of the Company, and Anna T. Chew, as Vice President and Chief Financial Officer, each hereby certifies, pursuant to 18 U.S.C. (section) 1350, as adopted pursuant to (section) 906 of the Sarbanes-Oxley Act of 2002, that, to the best of their knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

---

| | |
|:---|:---|
| By: | */s/Samuel A. Landy* |
| Name: | Samuel A. Landy |
| Title: | President and Chief Executive Officer |
| Date: | August 6, 2025 |
| By: | */s/Anna T. Chew* |
| Name: | Anna T. Chew |
| Title: | Executive Vice President and Chief Financial Officer |
| Date: | August 6, 2025 |

---