Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

______________________________________________________

FORM 10-Q

______________________________________________________

(Mark One)

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

For the quarterly period ended September 30, 2024

OR

☐	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 000-54382

______________________________________________________

PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.

(Exact Name of Registrant as Specified in Its Charter)

______________________________________________________

Maryland	26-3842535
(State or Other Jurisdiction of<br>Incorporation or Organization)	(I.R.S. Employer<br>Identification No.)
11766 Wilshire Blvd., Suite 1670
Los Angeles, California	90025
(Address of Principal Executive Offices)	(Zip Code)

(866) 722-6257

(Registrant’s Telephone Number, Including Area Code)

______________________________________________________________________

Securities registered pursuant to Section 12(b) of the Act:Title of each classTrading Symbol(s)Name of each exchange on which registeredNoneN/AN/A

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. (Check one):

Large Accelerated Filer	☐	Accelerated Filer	☐
Non-Accelerated Filer	☒	Smaller reporting company	☐
		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 Exchange Act).    Yes  ☐ No  ☒

As of November 6, 2024, there were 102,951,395 outstanding shares of common stock of Pacific Oak Strategic Opportunity REIT, Inc.

Table of Contents

PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.

FORM 10-Q

September 30, 2024

INDEX

PART I.	FINANCIAL INFORMATION		2
	Item 1.	Financial Statements	2
		Consolidated Balance Sheets as ofSeptember 30, 2024(unaudited) andDecember 31, 2023	2
		Consolidated Statements of Operations (unaudited) for the Three andNineMonths EndedSeptember 30, 2024and2023	3
		Consolidated Statements of Equity (unaudited) for the Three andNineMonths EndedSeptember 30, 2024and2023	4
		Consolidated Statements of Cash Flows (unaudited) for theNineMonths EndedSeptember 30, 2024and2023	5
		Condensed Notes to Consolidated Financial Statements as ofSeptember 30, 2024 (unaudited)	7
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
	Item 3.	Quantitative and Qualitative Disclosures about Market Risk	31
	Item 4.	Controls and Procedures	32
PART II.	OTHER INFORMATION		34
	Item 1.	Legal Proceedings	34
	Item 1A.	Risk Factors	34
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	34
	Item 3.	Defaults upon Senior Securities	34
	Item 4.	Mine Safety Disclosures	34
	Item 5.	Other Information	34
	Item 6.	Exhibits	35
SIGNATURES			37

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share amounts)

	September 30, 2024		December 31, 2023
	(unaudited)
Assets
Real estate held for investment, net	$	917,855	$	978,182
Real estate held for sale, net	4,491		116,572
Real estate equity securities	17,325		41,609
Total real estate and real estate-related investments, net	939,671		1,136,363
Cash and cash equivalents	18,902		99,160
Restricted cash	25,425		56,049
Investments in unconsolidated entities	80,909		45,901
Rents and other receivables, net	23,499		22,500
Prepaid expenses and other assets	20,904		26,292
Assets related to real estate held for sale, net	—		1,878
Total assets	$	1,109,310	$	1,388,143
Liabilities and equity
Notes and bonds payable related to real estate held for investment, net	$	923,772	$	954,309
Notes payable related to real estate held for sale, net	3,141		74,374
Notes and bonds payable, net	926,913		1,028,683
Accounts payable and accrued liabilities	27,724		30,409
Due to affiliates	11,889		7,902
Other liabilities	50,558		57,785
Total liabilities	1,017,084		1,124,779
Commitments, contingencies and guarantees (Note 9)
Equity
Stockholders’ equity
Preferred stock, $.01 par value; 10,000,000 shares authorized, no shares issued and outstanding	—		—
Common stock, $.01 par value; 1,000,000,000 shares authorized, 102,951,395 and 103,310,648 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively	1,030		1,033
Additional paid-in capital	898,682		901,049
Cumulative distributions and net loss	(804,352)		(639,933)
Total stockholders’ equity	95,360		262,149
Noncontrolling interests	(3,134)		1,215
Total equity	92,226		263,364
Total liabilities and equity	$	1,109,310	$	1,388,143

See accompanying condensed notes to consolidated financial statements.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 1. Financial Statements (continued)

PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

(in thousands, except per share amounts)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Revenues:
Rental income	$	30,223	$	31,872	$	92,045	$	96,101
Hotel revenues	1,186		1,195		6,225		6,673
Other operating income	1,028		1,094		2,896		3,299
Dividend income from real estate equity securities	—		1,685		81		3,795
Total revenues	32,437		35,846		101,247		109,868
Expenses:
Operating, maintenance, and management	11,791		12,102		33,877		34,377
Real estate taxes and insurance	5,618		6,281		18,649		18,541
Hotel expenses	1,363		1,330		5,016		5,275
Asset management fees to affiliates	3,901		3,696		11,875		11,380
General and administrative expenses	2,314		1,952		10,108		8,176
Foreign currency transaction loss (gain), net	4,556		1,123		(6,724)		4,675
Depreciation and amortization	10,276		12,399		31,405		36,556
Interest expense, net	20,585		17,928		55,366		49,747
Impairment charges on real estate and related intangibles	15,800		28,260		76,090		64,849
Total expenses	76,204		85,071		235,662		233,576
Other loss:
Loss from unconsolidated entities	(9,801)		(10,405)		(26,531)		(27,367)
Other interest income	379		639		1,117		1,855
Gain (loss) on real estate equity securities, net	8,726		(3,331)		(7,905)		(19,453)
(Loss) gain on sale of real estate, net	(1,243)		(221)		(624)		32,541
Total other loss, net	(1,939)		(13,318)		(33,943)		(12,424)
Net loss before income taxes	(45,706)		(62,543)		(168,358)		(136,132)
Income tax provision	—		—		—		(3,662)
Net loss	(45,706)		(62,543)		(168,358)		(139,794)
Net loss attributable to noncontrolling interests	1,981		2,311		3,939		2,506
Net loss attributable to common stockholders	$	(43,725)	$	(60,232)	$	(164,419)	$	(137,288)
Net loss per common share, basic and diluted	$	(0.42)	$	(0.58)	$	(1.59)	$	(1.32)
Weighted-average number of common shares outstanding, basic and diluted	102,969,498		103,571,651		103,128,083		103,726,148

See accompanying condensed notes to consolidated financial statements.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 1. Financial Statements (continued)

PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.

CONSOLIDATED STATEMENTS OF EQUITY

(unaudited)

(in thousands, except share amounts)

	Common Stock			Additional<br>Paid-in Capital		Cumulative Distributions and Net Loss		Total Stockholders' Equity		Noncontrolling Interests		Total Equity
	Shares	Amounts
Balance, June 30, 2024	103,016,968	$	1,030	$	899,052	$	(760,627)	$	139,455	$	(617)	$	138,838
Net loss	—	—		—		(43,725)		(43,725)		(1,981)		(45,706)
Transfers from redeemable common stock payable, net	—	—		1,860		—		1,860		—		1,860
Noncontrolling interest contributions	—	—		—		—		—		96		96
Noncontrolling interest distribution	—	—		(1,705)		—		(1,705)		(632)		(2,337)
Redemptions of common stock	(65,573)	—		(525)		—		(525)		—		(525)
Balance, September 30, 2024	102,951,395	$	1,030	$	898,682	$	(804,352)	$	95,360	$	(3,134)	$	92,226
	Common Stock			Additional<br>Paid-in Capital		Cumulative Distributions and Net Loss		Total Stockholders' Equity		Noncontrolling Interests		Total Equity
	Shares	Amounts
Balance, June 30, 2023	103,626,096	$	1,036	$	905,046	$	(572,838)	$	333,244	$	3,284	$	336,528
Net loss	—	—		—		(60,232)		(60,232)		(2,311)		(62,543)
Transfers to redeemable common stock, net	—	—		(2,043)		—		(2,043)		—		(2,043)
Redemptions of common stock	(186,398)	(2)		(1,955)		—		(1,957)		—		(1,957)
Noncontrolling interest distribution	—	—		—		—		—		(481)		(481)
Noncontrolling interest contribution	—	—		—		—		—		450		450
Balance, September 30, 2023	103,439,698	$	1,034	$	901,048	$	(633,070)	$	269,012	$	942	$	269,954
	Common Stock			Additional<br>Paid-in Capital		Cumulative Distributions and Net Loss		Total Stockholders' Equity		Noncontrolling Interests		Total Equity
---	---	---	---	---	---	---	---	---	---	---	---	---	---
	Shares	Amounts
Balance, December 31, 2023	103,310,648	$	1,033	$	901,049	$	(639,933)	$	262,149	$	1,215	$	263,364
Net loss	—	—		—		(164,419)		(164,419)		(3,939)		(168,358)
Transfers from redeemable common stock payable, net	—	—		2,217		—		2,217		—		2,217
Noncontrolling interest contributions	—	—		—		—		—		493		493
Noncontrolling interest distributions	—	—		(1,705)		—		(1,705)		(903)		(2,608)
Redemptions of common stock	(359,253)	(3)		(2,879)		—		(2,882)		—		(2,882)
Balance, September 30, 2024	102,951,395	$	1,030	$	898,682	$	(804,352)	$	95,360	$	(3,134)	$	92,226
	Common Stock			Additional<br>Paid-in Capital		Cumulative Distributions and Net Loss		Total Stockholders' Equity		Noncontrolling Interests		Total Equity
	Shares	Amounts
Balance, December 31, 2022	103,932,083	$	1,039	$	907,044	$	(495,782)	$	412,301	$	4,092	$	416,393
Net loss	—	—		—		(137,288)		(137,288)		(2,506)		(139,794)
Transfers to redeemable common stock, net	—	—		(830)		—		(830)		—		(830)
Redemptions of common stock	(492,385)	(5)		(5,166)		—		(5,171)		—		(5,171)
Noncontrolling interests distributions	—	—		—		—		—		(1,094)		(1,094)
Noncontrolling interest contribution	—	—		—		—		—		450		450
Balance, September 30, 2023	103,439,698	$	1,034	$	901,048	$	(633,070)	$	269,012	$	942	$	269,954

See accompanying condensed notes to consolidated financial statements.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 1. Financial Statements (continued)

PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

(in thousands)

	Nine Months Ended September 30,
	2024		2023
Cash Flows from Operating Activities:
Net loss	$	(168,358)	$	(139,794)
Adjustments to reconcile net loss to net cash used in operating activities:
Impairment charges on real estate and related intangibles	76,090		64,849
Loss from unconsolidated entities	26,531		27,367
Depreciation and amortization	31,405		36,556
Loss on real estate equity securities, net	7,905		19,453
Loss (gain) on sale of real estate, net	624		(32,541)
Deferred rent	(815)		(539)
Amortization of deferred financing costs and debt discount and premium, net	7,279		7,079
Foreign currency transaction (gain) loss, net	(6,724)		4,675
Changes in assets and liabilities:
Rents and other receivables, net	(194)		(410)
Prepaid expenses and other assets	(2,007)		(3,610)
Accounts payable and accrued liabilities	(2,623)		(983)
Due to affiliates	3,987		3,555
Other liabilities	6,232		3,894
Net cash used in operating activities	(20,668)		(10,449)
Cash Flows from Investing Activities:
Improvements to real estate	(22,039)		(16,394)
Proceeds from sales of real estate, net	87,411		40,867
Purchase of interest rate caps	(1,447)		(1,236)
Proceeds from interest rate cap settlements	2,439		—
Contributions to unconsolidated entities	(63,376)		(28,388)
Distributions of capital from an unconsolidated entity	1,497		1,144
Payments on foreign currency derivatives, net	(478)		(29,300)
Proceeds from the sale of real estate equity securities	16,379		13,791
Proceeds for development obligations	5		1,855
Payments on development obligations	(7,338)		(1,825)
Net cash provided by (used in) investing activities	13,053		(19,486)
Cash Flows from Financing Activities:
Proceeds from notes and bonds payable	179,787		93,117
Principal payments on notes and bonds payable	(273,173)		(77,673)
Payments of deferred financing costs	(6,454)		(5,028)
Redemptions of common stock	(2,882)		(5,171)
Noncontrolling interests contributions	493		450
Noncontrolling interests distributions	(2,608)		(1,094)
Net cash (used in) provided by financing activities	(104,837)		4,601
Effect of exchange rate changes on cash, cash equivalents and restricted cash	1,570		(4,153)
Net decrease in cash, cash equivalents and restricted cash	(110,882)		(29,487)
Cash, cash equivalents and restricted cash, beginning of period	155,209		159,044
Cash, cash equivalents and restricted cash, end of period	$	44,327	$	129,557

See accompanying condensed notes to consolidated financial statements.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 1. Financial Statements (continued)

PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

(unaudited)

(in thousands)

	Nine Months Ended September 30,
	2024		2023
Supplemental Disclosure of Cash Flow Information:
Interest paid, net of capitalized interest of $3,474 and $2,729 for the nine months ended September 30, 2024 and 2023, respectively	$	49,136	$	44,488
Supplemental Disclosure of Significant Noncash Transaction:
Accrued development obligations	3,880		8,578

See accompanying condensed notes to consolidated financial statements.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 1. Financial Statements (continued)

PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2024

(unaudited)

1.ORGANIZATION

Pacific Oak Strategic Opportunity REIT, Inc. (the “Company”) was formed on October 8, 2008 as a Maryland corporation and elected to be taxed as a real estate investment trust (“REIT”). The Company conducts its business primarily through Pacific Oak SOR (BVI) Holdings, Ltd. (“Pacific Oak SOR BVI”), a private company limited by shares according to the British Virgin Islands Business Companies Act, 2004, which was incorporated on December 18, 2015 and is authorized to issue a maximum of 50,000 common shares with no par value. Upon incorporation, Pacific Oak SOR BVI issued one certificate containing 10,000 common shares with no par value to Pacific Oak Strategic Opportunity Limited Partnership (the “Operating Partnership”), a Delaware limited partnership formed on December 10, 2008. The Company is the sole general partner of, and owns a 0.1% partnership interest in, the Operating Partnership. Pacific Oak Strategic Opportunity Holdings LLC (“REIT Holdings”), a Delaware limited liability company formed on December 9, 2008, owns the remaining 99.9% interest in the Operating Partnership and is its sole limited partner. The Company is the sole member and manager of REIT Holdings.

2.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

There have been no significant changes to the Company’s accounting policies since it filed its audited financial statements in its Annual Report on Form 10-K for the year ended December 31, 2023. For further information about the Company’s accounting policies, refer to the Company’s consolidated financial statements and notes thereto for the year ended December 31, 2023, included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”).

Principles of Consolidation and Basis of Presentation

The accompanying unaudited consolidated financial statements and condensed notes thereto have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information as contained within the Financial Accounting Standards Board’s Accounting Standards Codification and the rules and regulations of the SEC, including the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the unaudited consolidated financial statements do not include all of the information and footnotes required by GAAP for audited financial statements. In the opinion of management, the financial statements for the unaudited interim periods presented include all adjustments, which are of a normal and recurring nature, necessary for a fair and consistent presentation of the results for such periods. Operating results for the three and nine months ended September 30, 2024, are not necessarily indicative of the results that may be expected for the year ending December 31, 2024.

The consolidated financial statements include the accounts of the Company, REIT Holdings, the Operating Partnership, Pacific Oak SOR BVI and their direct and indirect wholly owned subsidiaries, and joint ventures in which the Company has a controlling interest and variable interest entities in which the Company is the primary beneficiary. All significant intercompany balances and transactions are eliminated in consolidation.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 1.     Financial Statements (continued)

PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

September 30, 2024

(unaudited)

Liquidity

The Company generally finances its real estate investments and operations using notes and bonds payable that are typically structured as non-recourse secured mortgages with maturities of approximately three to five years. Each reporting period management evaluates the Company’s ability to continue as a going concern by evaluating conditions and events, including assessing the liquidity needs to satisfy upcoming debt obligations and the ability to satisfy debt covenant requirements. Through the normal course of operations, and as further discussed in Note 4, the Company has $254.2 million of debt obligations coming due within one year following the report issuance date. In order to satisfy obligations as they mature, management will evaluate its options and may seek to utilize extension options (if available) in the respective loan agreements, may make partial loan repayments to meet debt covenant requirements, may seek to refinance certain debt instruments, may sell real estate equity securities to convert to cash to make principal payments, may market one or more properties for sale or may negotiate a turnover of one or more secured properties back to the related mortgage lender and remit payment for any associated loan guarantee. Historically, the Company has successfully refinanced debt instruments or utilized extension options in order to satisfy debt obligations as they come due and has not negotiated a turnover of a secured property back to a lender, though the Company may utilize such option if necessary. Based upon these plans, and the plans described above, management believes it will have sufficient liquidity to satisfy its obligations as they come due and to continue as a going concern. There can be no assurance as to the certainty or timing of any of management’s plans.

Use of Estimates

The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could materially differ from those estimates.

Segments

The Company operates in three reportable business segments: strategic opportunistic real estate and real estate-related investments (“strategic opportunistic properties”), residential homes, and hotel, which is how the Company’s management manages the business. In general, the Company intends to hold its investments in strategic opportunistic properties for capital appreciation. Traditional performance metrics of strategic opportunistic properties may not be meaningful as these investments are generally non-stabilized and do not provide a consistent stream of interest income or rental revenue. These investments exhibit similar long-term financial performance and have similar economic characteristics. These investments typically involve a higher degree of risk and do not provide a constant stream of ongoing cash flows. As a result, the Company’s management views strategic opportunistic properties as similar investments and aggregates them into one reportable business segment. The Company owns residential homes in 17 markets which are all aggregated into one reportable business segment due to the homes being stabilized, having high occupancy rates and having similar economic characteristics. Additionally, as of September 30, 2024, the Company owns one hotel, which is a separate reportable business segment due to the nature of the hotel business with short-term stays.

Real Estate Equity Securities

These investments are carried at their estimated fair value based on quoted market prices for the security, net of any discounts for restrictions on the sale of the security.

For the three months ended September 30, 2024, the Company did not recognize any realized gains or losses on real estate equity securities, and for the nine months ended September 30, 2024, the Company recognized realized losses on real estate equity securities of $31.7 million. For the three and nine months ended September 30, 2024, the Company recognized unrealized gains on real estate equity securities of $8.7 million and $23.8 million, respectively. For the three and nine months ended September 30, 2023, the Company recognized realized gains on real estate equity securities of $0.1 million and $5.9 million, respectively, and unrealized losses on real estate equity securities of $3.4 million and $25.4 million, respectively.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 1.     Financial Statements (continued)

PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

September 30, 2024

(unaudited)

Reclassifications

Certain amounts in the prior year period have been reclassified to conform to the current period presentation. Goodwill and redeemable common stock payable, which were previously reported separately on the accompanying consolidated balance sheets, are now included in prepaid expenses and other assets and other liabilities, respectively, for all periods presented. Additionally, the Company sold residential homes and a strategic opportunistic property during and subsequent to the nine months ended September 30, 2024 and as a result, certain assets and liabilities were reclassified to held for sale in the accompanying consolidated balance sheets for all periods presented. These reclassifications have not changed the results of operations of the prior period.

Square Footage, Occupancy and Other Measures

Any references to square footage, acreage, occupancy or annualized base rent are unaudited and outside the scope of the Company’s independent registered public accounting firm’s review of the Company’s financial statements in accordance with the standards of the United States Public Company Accounting Oversight Board.

Recently Issued Accounting Standards Updates

There have been no recent accounting pronouncements, changes in accounting pronouncements or recently adopted accounting guidance during the nine months ended September 30, 2024, that are of significance or potential significance to the Company.

3.REAL ESTATE HELD FOR INVESTMENT

As of September 30, 2024, the Company consolidated nine office complexes, encompassing, in the aggregate, approximately 3.2 million rentable square feet and these properties were 66% occupied. In addition, the Company owned one residential home portfolio consisting of 2,145 residential homes, and one apartment property, containing 317 units, which were 94% and 95% occupied, respectively. The Company also owned one hotel property with 196 rooms, four investments in undeveloped land with approximately 581 developable acres and one office/retail development property. The following table summarizes the Company’s real estate held for investment as of September 30, 2024 and December 31, 2023, respectively (in thousands):

	September 30, 2024		December 31, 2023
Land	$	226,777	$	229,434
Buildings and improvements	833,142		888,964
Tenant origination and absorption costs	11,809		15,423
Total real estate, cost	1,071,728		1,133,821
Accumulated depreciation and amortization	(153,873)		(155,639)
Total real estate held for investment, net	$	917,855	$	978,182

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 1.     Financial Statements (continued)

PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

September 30, 2024

(unaudited)

Operating Leases

Certain of the Company’s real estate properties are leased to tenants under operating leases for which the terms and expirations vary. As of September 30, 2024, the leases, excluding options to extend, apartment leases and residential home leases, which have terms that are generally one year or less, had remaining terms of up to 15.9 years with a weighted-average remaining term of 3.3 years. Some of the leases have provisions to extend the lease agreements, options for early termination after paying a specified penalty and other terms and conditions as negotiated. The Company retains substantially all of the risks and benefits of ownership of the real estate assets leased to tenants. Generally, upon the execution of a lease, the Company requires a security deposit from tenants in the form of a cash deposit and/or a letter of credit. The amount required as a security deposit varies depending upon the terms of the respective leases and the creditworthiness of the tenant, but generally are not significant amounts. Therefore, exposure to credit risk exists to the extent that a receivable from a tenant exceeds the amount of its security deposit. Security deposits received in cash and assumed in real estate acquisitions related to tenant leases are included in other liabilities in the accompanying consolidated balance sheets totaled $6.3 million and $5.9 million as of September 30, 2024 and December 31, 2023, respectively.

During the three and nine months ended September 30, 2024, the Company recognized deferred rent from tenants of $0.5 million and $0.9 million, net of lease incentive amortization, respectively. During the three and nine months ended September 30, 2023, the Company recognized deferred rent expense of $1.0 million and deferred rent income of $0.5 million, both net of lease incentive amortization, respectively. As of September 30, 2024 and December 31, 2023, the cumulative deferred rent receivable balance, including unamortized lease incentive receivables, was $20.4 million and $19.1 million, respectively, and is included in rents and other receivables in the accompanying consolidated balance sheets. The cumulative deferred rent balance included $2.8 million and $2.5 million of unamortized lease incentives as of September 30, 2024 and December 31, 2023, respectively.

As of September 30, 2024, the future minimum rental income from the Company’s office complexes, under non-cancelable operating leases was as follows (in thousands):

October 1, 2024 through December 31, 2024	$	15,100
2025	56,831
2026	45,633
2027	37,339
2028	30,244
Thereafter	69,933
	$	255,080

Geographic Concentration Risk

As of September 30, 2024, the Company’s real estate investments in California and Georgia represented 11.8% and 11.5%, respectively, of the Company’s total assets. As a result, the geographic concentration of the Company’s portfolio makes it particularly susceptible to adverse economic developments in the California and Georgia real estate markets. Any adverse economic or real estate developments in these markets, such as business layoffs or downsizing, industry slowdowns, relocations of businesses, changing demographics and other factors, or any decrease in demand for office space resulting from the local business climate, could adversely affect the Company’s operating results and its ability to make distributions to stockholders.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 1.     Financial Statements (continued)

PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

September 30, 2024

(unaudited)

Hotel Property

The following table provides detailed information regarding the Company’s hotel revenues during the three and nine months ended September 30, 2024 and 2023 (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Hotel revenues:
Room	$	994	$	988	$	5,407	$	5,794
Other	192		207		818		879
Hotel revenues	$	1,186	$	1,195	$	6,225	$	6,673

Contract Liabilities

The Company’s contract liabilities are comprised of: hotel advanced deposits, deferred proceeds received from the buyers of the Park Highlands undeveloped land sales, and value of Park Highlands undeveloped land that was contributed to a master association. As of September 30, 2024 and December 31, 2023, contract liabilities were $17.2 million and $23.8 million, respectively, which are included in other liabilities on the accompanying consolidated balance sheets. During nine months ended September 30, 2024 and 2023, the Company released $7.3 million and $1.8 million, respectively, of deferred proceeds related to the Park Highlands undeveloped land sales.

Impairment of Real Estate

During the nine months ended September 30, 2024, the Company recorded impairment charges on real estate and related intangibles of $76.1 million to write down the carrying value of five of the Company’s strategic opportunistic properties and one hotel due to declines in market conditions and projected cash flows, changes in sales comparisons, and also based on a quoted price. During the nine months ended September 30, 2023, the Company recorded impairment charges on real estate and related intangibles of $64.8 million to write down the carrying value of three strategic opportunistic properties to their estimated fair values due to increases in the discount and terminal cap rate assumptions, decreases in projected cash flows, and changes in sales comparisons.

Real Estate Sales

In September 2024, the Company, through an indirect wholly owned subsidiary, sold the Lofts at NoHo Commons, from the strategic opportunistic properties segment for gross sale proceeds of $92.5 million, before closing costs and credits. The Company recorded a loss on sale of real estate of $0.4 million and the Company repaid $68.5 million of the outstanding principal due under the secured mortgage loan. The purchaser is not affiliated with the Company or with the Company’s external advisor, Pacific Oak Capital Advisors, LLC (“Pacific Oak Capital Advisors”).

Pending Real Estate Sales

In March 2024, the Company, through indirect wholly owned subsidiaries, entered into a purchase and sale agreement for the sale of approximately 454 developable acres of Park Highlands undeveloped land, from the Company’s strategic opportunistic properties segment for gross sale proceeds of approximately $195.0 million, before closing costs, credits and taxes. Following a recent amendment to the purchase and sale agreement, the sale is now expected to be completed in three phases. The phases are anticipated to be sold to the buyer for approximately $91.0 million, $52.3 million and $51.7 million in December 2024, December 2026 and December 2027, respectively. Note that the anticipated closing dates may be changed in certain circumstances.

In addition, the land parcels are held through the Company’s taxable REIT subsidiaries (“TRS”) for certain tax planning purposes and to ensure preservation of the Company’s REIT status. A portion of the acres to be sold are pledged as collateral for the Series C bonds. There can be no assurance that the Company will complete the sale. The purchaser is not affiliated with the Company or Pacific Oak Capital Advisors.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 1.     Financial Statements (continued)

PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

September 30, 2024

(unaudited)

4.NOTES AND BONDS PAYABLE

As of September 30, 2024 and December 31, 2023, the Company’s notes and bonds payable consisted of the following (dollars in thousands):

	Book Value as of<br><br>September 30, 2024		Book Value as of<br><br>December 31, 2023		Contractual Interest Rate as of<br><br>September 30, 2024	Effective Interest Rate at<br><br>September 30, 2024 (1)	Payment Type (2)	Maturity Date (3)
Series B Bonds (4)	$	124,397	$	321,724	3.93%	3.93%	(4)	01/31/2026
Series C Bonds (4)	96,598		99,461		9.00%	9.00%	(4)	06/30/2026
Series D Bonds (4)	157,525		—		9.50%	9.50%	(4)	02/28/2029
Crown Pointe Mortgage Loan	54,738		54,738		SOFR + 2.30%	7.46%	Interest Only	04/01/2025 (5)
Georgia 400 Center Mortgage Loan (6)	39,799		40,184		SOFR + 2.75%	7.91%	Principal & Interest	10/22/2024 (5)(7)
PORT Mortgage Loan 1	34,967		34,967		4.74%	4.74%	Interest Only	10/01/2025
PORT Mortgage Loan 2	10,523		10,523		4.72%	4.72%	Interest Only	03/01/2026
PORT MetLife Loan 1 (6)	56,368		59,091		3.90%	3.90%	Interest Only	04/10/2026
PORT MetLife Loan 2 (6)	93,238		93,388		3.99%	3.99%	Interest Only	04/10/2026
Lincoln Court Mortgage Loan (6)	31,325		33,310		SOFR + 3.25%	8.41%	Interest Only	08/07/2025 (5)
Madison Square Mortgage Loan (6)	20,722		17,962		4.63%	3.99%	Interest Only	10/07/2024 (5)(7)
Bank of America Mortgage Loan (6)(8)	168,936		175,234		BSBY + 2.75%	7.66%	Principal & Interest	09/01/2026 (5)
NexBank Mortgage Loan (9)	34,090		—		SOFR + 3.50% (9)	8.66%	Principal & Interest	04/30/2025 (5)
Eight & Nine Corporate Centre Mortgage Loan	20,000		—		SOFR + 4.90% (10)	10.06%	Interest Only	02/09/2026 (5)
Lofts at NoHo Commons Mortgage Loan	—		68,451		(11)	(11)	(11)	(11)
Richardson Office Mortgage Loan (9)	—		12,209		(9)	(9)	(9)	(9)
Q&C Hotel Mortgage Loan (9)	—		24,579		(9)	(9)	(9)	(9)
Total notes and bonds payable principal outstanding	943,226		1,045,821
Deferred financing costs and debt discount and premium, net (12)	(16,313)		(17,138)
Total notes and bonds payable, net	$	926,913	$	1,028,683

_____________________

(1) Contractual interest rate represents the interest rate in effect under the loan as of September 30, 2024. Effective interest rate was calculated as the actual interest rate in effect as of September 30, 2024 (consisting of the contractual interest rate and contractual floor rates), using interest rate indices such as Secured Overnight Financing Rate (“SOFR”) or Bloomberg Short Term Bank Yield (“BSBY”) as of September 30, 2024, where applicable.

(2) Represents the payment type required under these loans as of September 30, 2024. Certain future monthly payments due under these loans also include amortizing principal payments.

(3) Represents the initial maturity date or the maturity date as extended as of September 30, 2024. For more information of the Company’s contractual obligations under its notes and bonds payable, see five-year maturity table, below.

(4) As of September 30, 2024, the Company had bonds outstanding of 1.4 billion Israeli new shekels (approximately $378.5 million as of September 30, 2024) (“Series Bonds”), of which 360.0 million Israeli new shekels (approximately $96.6 million as of September 30, 2024) were collateralized by real estate (specified lands in Park Highlands and Richardson). The Series Bonds principal payments are due on dates ranging from January 2025 to February 2029. On August 20, 2024, Pacific Oak SOR BVI issued 299.0 million Israeli new shekels of Series D bonds (the “Series D Expansion”) to Israeli investors pursuant to a public offering registered with the Israel Securities Authority. The Series D Expansion had an equal level of security, pari passu, amongst themselves and between them and the existing Series D bonds without any right of precedence or preference between any of them. On September 19, 2024, the Company prepaid approximately 312.8 million Israeli new shekels of the January 31, 2025 Series B bond payment, with 75.4 million Israeli new shekels outstanding. Subsequent to September 30, 2024, the Company sold parcels of collateralized Park Highlands undeveloped land, refer to Note 10 for additional details.

(5) Subject to certain conditions, the maturity dates of certain loans may be extended beyond the date shown.

(6) The Company’s notes and bonds payable are generally non-recourse. These mortgage loans have guarantees over certain balances whereby the Company would be required to make the remaining payments in the event that the Company turned the property over to the lender. As of September 30, 2024, the guaranteed amount in the aggregate was $202.6 million.

(7) Subsequent to September 30, 2024, the Company was in refinancing negotiations with the lender for loans that have matured and were in technical default.

(8) This loan was cross-collateralized by the associated properties: Park Centre, 1180 Raymond, The Marq, and Oakland City Center.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 1.     Financial Statements (continued)

PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

September 30, 2024

(unaudited)

(9) During the nine months ended September 30, 2024, the Company refinanced and consolidated two of its mortgage loans into one NexBank Mortgage Loan and is cross-collateralized by the Richardson Office and Q&C Hotel properties. The effective interest rate is at the higher of one-month SOFR plus 3.50% or 7.50%.

(10) The effective interest rate is at the higher of one-month SOFR plus 4.90% or 8.90%.

(11) In September 2024, in connection with the disposition of the Lofts at NoHo Commons, the Company repaid the $68.5 million outstanding principal balance due under the Lofts at NoHo Commons Mortgage Loan.

(12) Represents the unamortized premium/discount on notes and bonds payable due to the above- and below-market interest rates when the debt was assumed. The discount/premium is amortized over the remaining life of the notes and bonds payable.

During the three and nine months ended September 30, 2024, the Company incurred $20.6 million and $55.4 million, respectively, of interest expense. Included in interest expense during the three and nine months ended September 30, 2024 was $2.5 million and $7.3 million, respectively, of amortization of deferred financing costs and debt discount and premium.

During the three and nine months ended September 30, 2023, the Company incurred $17.9 million and $49.7 million, respectively, of interest expense. Included in interest expense during the three and nine months ended September 30, 2023 was $2.5 million and $7.1 million, respectively, of amortization of deferred financing costs and debt discount and premium, net.

As of September 30, 2024 and December 31, 2023, the Company’s interest payable was $7.9 million and $9.0 million, respectively.

The following is a schedule of maturities, including principal amortization payments, for all notes and bonds payable outstanding as of September 30, 2024 (in thousands):

October 1, 2024 through December 31, 2024	$	72,772
2025	183,574
2026	529,356
2027	52,508
2028	52,508
Thereafter	52,508
	$	943,226

The Company’s notes and bonds payable contain financial debt covenants, including minimum equity requirements and liquidity ratios. As of September 30, 2024, the Company was in compliance with all of these debt covenants with the exception of the Lincoln Court Mortgage Loan, Georgia 400 Center Mortgage Loan and NexBank Mortgage Loan which was not in compliance with the debt service coverage requirement. As a result of such non-compliance, the Company is required to provide a cash sweep and/or principal pay downs if in continuous non-compliance.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 1.     Financial Statements (continued)

PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

September 30, 2024

(unaudited)

5.FAIR VALUE DISCLOSURES

As of September 30, 2024 and December 31, 2023, the carrying amounts and fair values of the Company’s financial instruments are as follows (in thousands):

	September 30, 2024				December 31, 2023
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Financial liabilities (Level 3):
Notes payable	$	561,140	$	557,592	$	620,262	$	611,725
Financial liabilities (Level 1):
Series B Bonds	$	118,826	$	119,179	$	312,458	$	296,380
Series C Bonds	$	94,291	$	99,457	$	95,963	$	102,664
Series D Bonds	$	152,656	$	157,458	$	—	$	—

Disclosure of the fair value of financial instruments is based on pertinent information available to the Company as of the period end and requires a significant amount of judgment.

As of September 30, 2024, the Company measured the following assets at fair value (in thousands):

			Fair Value Measurements Using
	Total		Quoted Prices in Active Markets for Identical Assets<br>(Level 1)		Significant Other Observable Inputs<br>(Level 2)		Significant Unobservable Inputs<br>(Level 3)
Recurring Basis:
Real estate equity securities	$	17,325	$	17,325	$	—	$	—
Asset derivative - interest rate caps (1)	$	571	$	—	$	571	$	—
Nonrecurring Basis:
Impaired real estate (2)	$	338,286	$	—	$	—	$	338,286

_____________________

(1) Interest rate caps are included in prepaid expenses and other assets in the consolidated balance sheets.

(2) Amount represents the fair value for a real estate asset impacted by impairment charges during the nine months ended September 30, 2024, as of the date that the fair value measurement was made. The carrying value for the real estate asset may have subsequently increased or decreased from the fair value reflected due to activity that has occurred since the measurement date.

During the nine months ended September 30, 2024, five of the Company’s strategic opportunistic properties and one hotel were impaired and written down to their estimated fair values due to declines in market conditions and projected cash flows. Three of the Company’s strategic opportunistic properties and one hotel were measured based on an income approach with the significant unobservable inputs used in evaluating the estimated fair value of the properties, with discount rates between 8.25% to 9.50% and terminal cap rates between 7.25% to 8.00%. One strategic opportunistic property was measured based on a quoted price and another based on a sales comparison approach.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 1.     Financial Statements (continued)

PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

September 30, 2024

(unaudited)

During the nine months ended September 30, 2023, three of the Company’s strategic opportunistic properties were measured at the estimated fair values. Two of the strategic opportunistic properties were measured based on an income approach with the significant unobservable inputs used in evaluating the estimated fair value of these properties, which are discount rates between 8.75% to 9.00% and terminal cap rates between 8.00% to 8.25%, and one strategic opportunistic property was measured at its estimated value based on a sales comparison approach. Additionally, during the nine months ended September 30, 2023, one investment in unconsolidated entity was measured at the estimated value of the Company’s ownership calculated based on a hypothetical liquidation of the net assets, discounted for lack of marketability and control. The Company used a discount rate of 8.75% and a cap rate of 7.00% to estimate the fair value of the real estate, an interest rate adjustment of 0.15% to estimate the fair value of the debt, a discount rate of 20.00% for lack of marketability, and a discount rate of 20.00% for lack of control.

As of December 31, 2023, the Company measured the following assets at fair value (in thousands):

			Fair Value Measurements Using
	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Recurring Basis:
Real estate equity securities	$	41,609	$	41,609	$	—	$	—
Asset derivative - interest rate caps (1)	$	1,236	$	—	$	1,236	$	—
Asset derivative - foreign currency collar (1)	$	3,655	$	—	$	3,655	$	—
Nonrecurring Basis:
Impaired real estate (2)	$	193,529	$	—	$	—	$	193,529

_____________________

(1) Interest rate caps and foreign currency collars are included in prepaid expenses and other assets on the accompanying consolidated balance sheets.

(2) Amount represents the fair value for a real estate asset impacted by impairment charges during the year ended December 31, 2023, as of the date that the fair value measurement was made. The carrying value for the real estate asset may have subsequently increased or decreased from the fair value reflected due to activity that has occurred since the measurement date.

6.RELATED PARTY TRANSACTIONS

The Company has entered into agreements with certain affiliates pursuant to which they provide services to the Company. Pursuant to the terms of these agreements, summarized below are the related-party costs incurred by the Company for the three and nine months ended September 30, 2024 and 2023, respectively, and any related amounts payable as of September 30, 2024 and December 31, 2023 (in thousands):

	Incurred during the three months ended September 30,				Incurred during the nine months ended September 30,				Payable as of
	2024		2023		2024		2023		September 30, 2024		December 31, 2023
Expensed
Asset management fees	$	3,901	$	3,696	$	11,875	$	11,380	$	10,998	$	6,855
Property management fees (1)	699		700		2,023		2,223		192		153
Disposition fees (2)	418		—		454		420		—		—
Reimbursable offering costs (3)	—		—		—		894		699		894
	$	5,018	$	4,396	$	14,352	$	14,917	$	11,889	$	7,902

_____________________

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 1.     Financial Statements (continued)

PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

September 30, 2024

(unaudited)

(1) Property management fees paid to DMH Realty, LLC (“DMH Realty”), an affiliate of Pacific Oak Capital Advisors and the advisor of the Company’s wholly-owned subsidiary, Pacific Oak Residential Trust, Inc. (“PORT”), pursuant to the property management agreement between DMH Realty and PORT, are recorded as operating, maintenance, and management expenses in the accompanying consolidated statements of operations.

(2) Disposition fees with respect to real estate properties sold are recorded as a component of the gain or loss on sale of real estate in the accompanying consolidated statements of operations.

(3) Reimbursable offering costs to Pacific Oak Capital Advisors related to the terminated PORT private offering.

7.INVESTMENTS IN UNCONSOLIDATED ENTITIES

As of September 30, 2024 and December 31, 2023, the Company’s investments in unconsolidated entities were composed of the following (in thousands):

	Number of Properties as of						Investment Balance as of
Joint Venture		Location		Ownership %		September 30, 2024				December 31, 2023
110 William Joint Venture	1		New York, New York		(1)		$	60,263	(1)		$	22,314
Pacific Oak Opportunity Zone Fund I	4		Various		47.0%		20,646		(2)		23,587
353 Sacramento Joint Venture	1		San Francisco, California		55.0%		—		(3)		—
							$	80,909			$	45,901

_____________________

(1) As of September 30, 2024, the Company owned 77.5% of preferred interest and 100% of common interest in the joint venture. Refer to Note 9 for additional details.

(2) The maximum exposure to loss as a result of the Company’s investment in the Pacific Oak Opportunity Zone Fund I is limited to the carrying amount of the investment.

(3) The Company suspended the equity method of accounting for the 353 Sacramento Joint Venture.

The following summarizes financial information for investment in unconsolidated entities (in thousands):

	September 30, 2024		December 31, 2023
Assets:
Real estate, net	$	429,242	$	411,028
Total assets	517,448		468,002
Liabilities:
Notes payable, net (1)	418,126		410,563
Total liabilities	444,819		427,794
Total equity	$	72,629	$	40,207

_____________________

(1) The Company guaranteed all debt servicing costs and timely debt payments by the 110 William Joint Venture. As of September 30, 2024 and December 31, 2023, the 110 William Joint Venture had $248.7 million of variable rate debt outstanding that was subject to the Company’s guarantee. Additionally, the 110 William Joint Venture met funding conditions with an aggregate available borrowing capacity of $56.7 million, subject to the Company’s guarantee. As of September 30, 2024, there was no outstanding balance under the $56.7 million funding facility. The debt was collateralized by the underlying real estate and has an initial maturity date of July 5, 2026, although the maturity date may be extended under certain circumstances. Debt and interest payments were current as of September 30, 2024. Refer to Note 9 for additional details.

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2024		2023		2024		2023
Total revenues	$	8,869	$	9,793	$	27,314	$	31,257
Operating loss	(13,607)		(61,553)		(35,852)		(89,634)
Net (loss) income	$	(13,598)	$	6,733	$	(35,825)	$	(21,248)

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 1.     Financial Statements (continued)

PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

September 30, 2024

(unaudited)

8.REPORTING SEGMENTS

The Company recognizes three reporting segments for the three and nine months ended September 30, 2024 and 2023, which consist of: strategic opportunistic properties, residential homes, and hotel. All corporate related costs are included in the strategic opportunistic properties segment to align with how financial information is presented to the Company's Chief Executive Officer and President, who are jointly the chief operating decision maker (the “CODM”). The CODM makes key operating decisions, evaluates financial results and manages the Company’s business based on the selected financial information. The selected financial information for reporting segments for the three and nine months ended September 30, 2024 and 2023 are as follows (in thousands):

	Three Months Ended September 30, 2024
	Strategic Opportunistic Properties		Residential Homes		Hotel		Total
Total revenues	$	22,306	$	8,945	$	1,186	$	32,437
Total expenses	(61,158)		(10,517)		(4,529)		(76,204)
Total other (loss) income	(1,129)		46		(856)		(1,939)
Net loss before income taxes	$	(39,981)	$	(1,526)	$	(4,199)	$	(45,706)
	Nine Months Ended September 30, 2024
	Strategic Opportunistic Properties		Residential Homes		Hotel		Total
Total revenues	$	68,359	$	26,663	$	6,225	$	101,247
Total expenses	(188,649)		(32,553)		(14,460)		(235,662)
Total other (loss) income	(33,460)		330		(813)		(33,943)
Net loss before income taxes	$	(153,750)	$	(5,560)	$	(9,048)	$	(168,358)
	Three Months Ended September 30, 2023
---	---	---	---	---	---	---	---	---
	Strategic Opportunistic Properties		Residential Homes		Hotel		Total
Total revenues	$	25,163	$	9,488	$	1,195	$	35,846
Total expenses	(71,131)		(11,570)		(2,370)		(85,071)
Total other (loss) income	(13,473)		121		34		(13,318)
Net loss before income taxes	$	(59,441)	$	(1,961)	$	(1,141)	$	(62,543)
	Nine Months Ended September 30, 2023
	Strategic Opportunistic Properties		Residential Homes		Hotel		Total
Total revenues	$	74,924	$	28,269	$	6,673	$	109,868
Total expenses	(190,773)		(34,239)		(8,564)		(233,576)
Total other (loss) income	(12,673)		142		107		(12,424)
Net loss before income taxes	$	(128,522)	$	(5,828)	$	(1,784)	$	(136,132)

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 1.     Financial Statements (continued)

PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

September 30, 2024

(unaudited)

Total assets related to the reporting segments as of September 30, 2024 and December 31, 2023 are as follows (in thousands):

	Strategic Opportunistic Properties		Residential Homes		Hotel		Total
Total assets as of September 30, 2024	$	784,249	$	289,492	$	35,569	$	1,109,310
Total assets as of December 31, 2023	$	1,024,555	$	315,957	$	47,631	$	1,388,143

9.COMMITMENTS, CONTINGENCIES AND GUARANTEES

Lease Obligations

As of September 30, 2024 and December 31, 2023, the Company’s lease and rights to a leasehold interest with respect to 210 West 31st, which was accounted as a finance lease, are included in the consolidated balance sheet as follows:

	September 30, 2024			December 31, 2023
Right-of-use asset (included in real estate held for investment, net, in thousands)	$	6,014		$	6,391
Lease obligation (included in other liabilities, in thousands)	9,494			9,537
Remaining lease term	89.3 years			90.0 years
Discount rate	4.8		%	4.8		%

As of September 30, 2024, the Company had a leasehold interest expiring in 2114. Future minimum lease payments under the Company’s finance lease as of September 30, 2024 are as follows (in thousands):

October 1, 2024 through December 31, 2024	$	90
2025	393
2026	396
2027	396
2028	396
Thereafter	51,375
Total expected minimum lease obligations	53,046
Less: Amount representing interest (1)	(43,552)
Present value of net minimum lease payments (2)	$	9,494

_____________________

(1) Interest includes the amount necessary to reduce the total expected minimum lease obligations to present value calculated at the Company’s incremental borrowing rate at acquisition.

(2) The present value of net minimum lease payments is included in other liabilities in the accompanying consolidated balance sheets.

Capital Commitments

The Company previously committed to funding up to $105.0 million (the “Capital Commitments”) to the 110 William Joint Venture in exchange for 77.5% of preferred interest in the joint venture. As of September 30, 2024, the Company had a future funding commitment of $13.3 million related to the Capital Commitments. The Capital Commitments fund the building expenditures and tenant improvements. No accrual was recognized as of September 30, 2024. Subsequent to September 30, 2024, the remaining commitment amount was funded.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 1.     Financial Statements (continued)

PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

September 30, 2024

(unaudited)

Guarantee Agreements

As of September 30, 2024, and as part of the previous 110 William Joint Venture debt and restructuring agreements, the Company guaranteed the completion of the construction and the development of the building expenditures and tenant improvements. The Company also guaranteed all debt servicing costs and timely debt payments by the 110 William Joint Venture. Refer to Note 7 for additional details.

The guaranteed amounts are due upon occurrence of a triggering event, such as default for nonpayment or failure to perform based on the conditions defined in the agreement. As of September 30, 2024, the maximum potential amount of future payments under the Company’s guarantees is not estimable as it is dependent on various factors including the 110 William Joint Venture’s future operating performance level, potential completion cost overages, future levels of variable rate debt and related interest, and the amount of future contributions by the Company. Due to uncertainties surrounding these factors, the Company was unable to estimate the maximum amounts payable under the guarantees. As of September 30, 2024, no triggering events had occurred, the likelihood of loss was determined to be remote, and no liability related to the guarantees was recognized.

Economic Dependency

The Company is dependent on Pacific Oak Capital Advisors and its affiliates for certain services that are essential to the Company, including the identification, evaluation, negotiation, origination, acquisition and disposition of investments; management of the daily operations of the Company’s investment portfolio; and other general and administrative responsibilities. In the event that Pacific Oak Capital Advisors and its affiliates is unable to provide these services, the Company will be required to obtain such services from other sources.

Environmental

As an owner of real estate, the Company is subject to various environmental laws of federal, state and local governments. Although there can be no assurance, the Company is not aware of any environmental liability that could have a material adverse effect on its financial condition or results of operations as of September 30, 2024.

Legal Matters

In the ordinary course of business, the Company may become subject to litigation, claims and regulatory matters. As of September 30, 2024, there are no material legal or regulatory proceedings pending or known to be contemplated against the Company or its properties.

10.SUBSEQUENT EVENTS

The Company evaluates subsequent events up until the date the consolidated financial statements are issued.

Park Highlands Land

In October 2024, the Company, through an indirect wholly owned subsidiary, sold approximately 122 developable acres of Park Highlands undeveloped land for gross sale proceeds of approximately $75.5 million, before closing costs, credits and taxes. A portion of the Park Highlands undeveloped land was collateral for the Series C bonds and due to the sale, approximately $10.6 million of the sales proceeds were restricted in a deposit account. The purchaser is not affiliated with the Company or Pacific Oak Capital Advisors.

Residential Homes Sale

In October 2024, the Company, through an indirect wholly owned subsidiary, sold 45 residential homes for gross sale proceeds of approximately $8.3 million, before closing costs and credits. In connection with the sale, the Company repaid $3.2 million of the outstanding principal due under the secured mortgage loan. The purchaser is not affiliated with the Company or Pacific Oak Capital Advisors.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

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

The following discussion and analysis should be read in conjunction with the accompanying financial statements of Pacific Oak Strategic Opportunity REIT, Inc. and the notes thereto. As used herein, the terms “we,” “our” and “us” refer to Pacific Oak Strategic Opportunity REIT, Inc., a Maryland corporation, and, as required by context, Pacific Oak Strategic Opportunity Limited Partnership, a Delaware limited partnership, which we refer to as the “Operating Partnership,” and to their subsidiaries.

Forward-Looking Statements

Certain statements included in this Quarterly Report on Form 10-Q are forward-looking statements. Those statements include statements regarding the intent, belief or current expectations of Pacific Oak Strategic Opportunity REIT, Inc. and members of our management team, as well as the assumptions on which such statements are based, and generally are identified by the use of words such as “may,” “will,” “seeks,” “anticipates,” “believes,” “estimates,” “expects,” “plans,” “intends,” “should” or similar expressions. Actual results may differ materially from those contemplated by such forward-looking statements. Further, forward-looking statements speak only as of the date they are made, and we undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time, unless required by law.

The following are some of the risks and uncertainties, although not all of the risks and uncertainties, which could cause our actual results to differ materially from those presented in our forward-looking statements:

•We depend on our advisor, Pacific Oak Capital Advisors, LLC and its affiliates, to conduct our operations and eventually dispose of our investments.

•We depend on tenants for our revenue and, accordingly, our revenue is dependent upon the success and economic viability of our tenants. Revenues from our property investments could decrease due to a reduction in tenants (caused by factors including, but not limited to, tenant defaults, tenant insolvency, early termination of tenant leases and non-renewal of existing tenant leases) and/or lower rental rates, limiting our ability to pay distributions to our stockholders.

•We depend on the availability of and costs associated with sources of real estate liquidity.

•Our opportunistic investment strategy involves a higher risk of loss than would a strategy of investing in some other types of real estate and real estate-related investments.

•Inflation and increased interest rates may adversely affect our financial condition and results of operations, including with respect to our ability to refinance maturing debt.

•We have paid distributions from financings and in the future, we may not pay distributions solely from our cash flow from operations or gains from asset sales. To the extent that we pay distributions from sources other than our cash flow from operations or gains from asset sales, we will have less funds available for investment in loans, properties and other assets, the overall return to our stockholders may be reduced and subsequent investors may experience dilution.

•All of our executive officers and some of our directors and other key real estate and debt finance professionals are also officers, directors, managers, key professionals and/or holders of a direct or indirect controlling interest in our advisor, our dealer manager and other Pacific Oak-affiliated entities. As a result, they face conflicts of interest, including significant conflicts created by our former or current advisor’s compensation arrangements with us and other Pacific Oak-advised programs and investors and conflicts in allocating time among us and these other programs and investors. These conflicts could result in unanticipated actions. Fees paid to our advisor in connection with transactions involving the origination, acquisition and management of our investments are based on the cost of the investment, not on the quality of the investment or services rendered to us. This arrangement could influence our advisor to recommend riskier transactions to us.

•We pay substantial fees to and expenses of our advisor, Pacific Oak Capital Advisors, LLC and its affiliates. These payments increase the risk that our stockholders will not earn a profit on their investment in us and increase our stockholders’ risk of loss.

•We have focused, and may continue to focus, our investments in non-performing: real estate, real estate-related loans, investments in joint ventures, and real estate-related securities, which involve more risk than investments in performing real estate and real estate-related assets.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (continued)

All forward-looking statements should be read in light of the risks identified in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the Securities and Exchange Commission (the “SEC”).

Overview

We were formed on October 8, 2008 as a Maryland corporation, elected to be taxed as a real estate investment trust (“REIT”) beginning with the taxable year ended December 31, 2010 and intend to operate in such manner. Pacific Oak Capital Advisors, LLC (“Pacific Oak Capital Advisors”) is our advisor and as our advisor, Pacific Oak Capital Advisors manages our day-to-day operations and our portfolio of investments. Our advisor also has the authority to make all of the decisions regarding our investments, except for our residential homes portfolio. Our residential homes portfolio, held through our subsidiary Pacific Oak Residential Trust, Inc. (“PORT”), is managed by Pacific Oak Residential Advisors, LLC (“PORA”), an affiliate of our advisor. The advisory duties are subject to the limitations in our charter and the direction and oversight of our board of directors. Our advisor also provides asset-management, marketing, investor-relations and other administrative services on our behalf. We have sought to invest in and manage a diverse portfolio of real estate-related loans, opportunistic real estate, real estate-related debt securities, real estate equity securities and other real estate-related investments. We conduct our business primarily through our Operating Partnership, of which we are the sole general partner.

As of September 30, 2024, we consolidated nine office complexes, encompassing, in the aggregate, approximately 3.2 million rentable square feet, one residential home portfolio consisting of 2,145 residential homes, one apartment property containing 317 units, one hotel property with 196 rooms, four investments in undeveloped land with approximately 581 developable acres, one office/retail development property and held an interest in three investments in unconsolidated entities.

Market Outlook – Real Estate and Real Estate Finance Markets

Volatility in global financial markets and changing political environments can cause fluctuations in the performance of the U.S. commercial real estate markets. Possible future declines in rental rates, slower or potentially negative net absorption of leased space and expectations of future rental concessions, including free rent to renew tenants early, to retain tenants who are up for renewal or to attract new tenants, may result in decreases in cash flows from investment properties. To the extent there are increases in the cost of financing due to higher interest rates, this may cause difficulty in refinancing debt obligations at terms as favorable as the terms of existing indebtedness. Further, increases in interest rates would increase the amount of our debt payments on our variable rate debt to the extent the interest rates on such debt are not limited by interest rate caps. Market conditions can change quickly, potentially negatively impacting the value of real estate investments. Management continuously reviews our investment and debt financing strategies to optimize our portfolio and the cost of our debt exposure.

Liquidity and Capital Resources

Our principal demand for funds during the short and long-term is and will be for payments under debt and funding obligations, including principal repayments, the acquisition of real estate and real estate-related investments, payment of operating expenses, capital expenditures and general and administrative expenses, redemptions and purchases of our common stock (to the extent we resume our share redemption program, which we suspended on July 30, 2024) and payments of distributions to stockholders. To date, we have had five primary sources of capital for meeting our cash requirements:

•Proceeds from the primary portion of our initial public offering;

•Proceeds from our dividend reinvestment plan;

•Debt financing, including bond offerings in Israel;

•Proceeds from the sale of real estate and real estate-related investments; and

•Cash flow generated by our real estate and real estate-related investments.

Our investments in real estate generate cash flow in the form of rental revenues and tenant reimbursements, which are reduced by operating expenditures and corporate general and administrative expenses. Cash flow from operations from our real estate investments is primarily dependent upon the occupancy levels of our properties, the net effective rental rates on our leases, the collectability of rent and operating recoveries from our tenants and how well we manage our expenditures. As of September 30, 2024, our office complexes were collectively 66% occupied, our residential home portfolio was 94% occupied and our apartment property was 95% occupied.

Investments in real estate equity securities may generate cash flow in the form of dividend income. As of September 30, 2024, we had one investment in real estate equity securities outstanding with a total carrying value of $17.3 million.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (continued)

Under our charter, we are required to limit our total operating expenses to the greater of 2% of our average invested assets or 25% of our net income for the four most recently completed fiscal quarters, as these terms are defined in our charter, unless the conflicts committee has determined that such excess expenses were justified based on unusual and non-recurring factors. Operating expenses for the four fiscal quarters ended September 30, 2024 did not exceed the charter-imposed limitation.

For the nine months ended September 30, 2024, our cash needs for capital expenditures, redemptions of common stock funding commitment, and debt requirements were met with proceeds from dispositions of real estate, proceeds from debt financing and cash on hand, except where otherwise noted. Operating cash needs during the same period were met through cash flow generated by our real estate and real estate-related investments and cash on hand. As of September 30, 2024, we had outstanding debt obligations in the aggregate principal amount of $943.2 million, with a weighted-average remaining term of 1.9 years. As of September 30, 2024, we had $219.3 million of debt obligations scheduled to mature over the period from October 1, 2024 through September 30, 2025. Of these debt obligations $106.8 million have extension options if we comply with certain debt covenants that may include one or a combination of the following ratios: debt-to-value, debt yield, minimum equity requirements and debt service coverage. In order to satisfy obligations as they mature, we plan to utilize extension options available in the respective loan agreements, may seek to refinance certain debt instruments, may market one or more properties for sale or may negotiate a turnover of one or more secured properties back to the related mortgage lender. We have also agreed to fund expenditures and improvements to the 110 William Joint Venture of $105.0 million (the “Capital Commitments”). As of September 30, 2024, the outstanding amount to be paid under the Capital Commitments is approximately $13.3 million. Subsequent to September 30, 2024, the remaining commitment amount was funded. Based upon these plans, we believe we will have sufficient liquidity to continue as a going concern. There can be no assurance as to the certainty or timing of any of our plans.

We plan to meet these obligations primarily through a combination of one or more of cash on hand, asset sales, extension options (if available), refinancings (whether with the same lender or different lenders) and issuing additional debt. We believe that with these options we have sufficient cash on hand and availability to address our debt maturities and capital needs scheduled to mature over the period October 1, 2024 through September 30, 2025. However, tighter financial conditions, higher interest rates and lower asset values may make it more difficult to refinance our loans or to sell assets on favorable terms. In recent years, we have accessed debt capital through the Israeli capital markets, but that source of debt capital may be limited in the future because of changing conditions such as the ongoing conflicts in Israel. Our mortgage loans are primarily non-recourse to us, meaning the lender’s recourse is to take possession of the underlying property. It is possible we may choose not to repay or refinance some of the maturing loans, which would ultimately result in losing possession of the underlying property.

Guarantee Agreements

As of September 30, 2024, and as part of the previous 110 William Joint Venture debt and restructuring agreements, we guaranteed the completion of the construction and the development of the building expenditures and tenant improvements. We also guaranteed all debt servicing costs and timely debt payments by the 110 William Joint Venture.

The guaranteed amounts are due upon occurrence of a triggering event, such as default for nonpayment or failure to perform based on the conditions defined in the agreement. The maximum potential amount of future payments under the guarantees is not currently estimable as it is dependent on various factors including the 110 William Joint Venture’s future operating performance level, potential completion cost overages, future levels of variable rate debt and related interest, and the amount of future contributions by us. Due to uncertainties surrounding these factors, we were unable to estimate the maximum amounts payable under the guarantees. As of September 30, 2024, no triggering events had occurred, the likelihood of loss was determined to be remote, and no liability related to the guarantee was recognized.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (continued)

Cash Flows from Operating Activities

As of September 30, 2024, we consolidated nine office complexes, encompassing, in the aggregate, approximately 3.2 million rentable square feet and these properties were 66% occupied. In addition, we owned one residential home portfolio consisting of 2,145 residential homes, and one apartment property containing 317 units, which were 94% and 95% occupied, respectively. We also owned one hotel property with 196 rooms, four investments in undeveloped land with approximately 581 developable acres, and one office/retail development property, and held an interest in three investments in unconsolidated entities and one investment in real estate equity securities. During the nine months ended September 30, 2024, net cash used in operating activities was $20.7 million. We expect that our cash flows from operating activities will increase in future periods as a result of leasing additional space that is currently unoccupied and anticipated future acquisitions of real estate and real estate-related investments. However, our cash flows from operating activities may decrease to the extent that we dispose of additional assets.

In addition to making investments in accordance with our investment objectives, we use or have used our capital resources to make certain payments to our advisor and our dealer manager. During our offering stage, these payments included payments to our dealer manager for selling commissions and dealer manager fees related to sales in our primary offering and payments to our dealer manager and our advisor for reimbursement of certain organization and other offering expenses related both to the primary offering and the dividend reinvestment plan. During our acquisition and development stage, we have continued to make payments to our advisor in connection with the selection and origination or purchase of investments, the management of our assets and costs incurred by our advisor in providing services to us as well as for any dispositions of assets (including the discounted payoff of non-performing loans).

The advisory agreement with our advisor has a one-year term but may be renewed for an unlimited number of successive one-year periods upon the mutual consent of our advisor and our conflicts committee.

Among the fees payable to our advisor is an asset management fee. With respect to investments other than real property, the asset management fee is a monthly fee calculated, each month, as one-twelfth of 1.0%, of the lesser of (i) the amount actually paid or allocated to acquire or fund the loan or other investment, inclusive of fees and expenses related thereto and the amount of any debt associated with or used to acquire or fund such investment and (ii) the outstanding principal amount of such loan or other investment, plus the fees and expenses related to the acquisition or funding of such investment, as of the time of calculation. With respect to investments in real property, the asset management fee is a monthly fee equal to one-twelfth of 1.0%, of the sum of the amount paid or allocated to acquire the investment, plus the cost of any subsequent development, construction or improvements to the property, and inclusive of fees and expenses related thereto and the amount of any debt associated with or used to acquire such investment. In the case of investments made through joint ventures, the asset management fee will be determined based on our proportionate share of the underlying investment, inclusive of our proportionate share of any fees and expenses related thereto.

Investments made in or through PORT are excluded from the calculation of the asset management fee we pay to our advisor. In addition to other fees described in the advisory agreement between PORT and PORA, PORT pays PORA a quarterly asset management fee equal to 0.25% (1.0% annually) on the aggregate value of PORT’s assets, as determined in accordance with PORT’s valuation guidelines, as of the end of each quarter.

Cash Flows from Investing Activities

Net cash provided by investing activities was $13.1 million for the nine months ended September 30, 2024, and consisted primarily of the following:

•Proceeds from sales of real estate of $87.4 million;

•Contributions to unconsolidated entities of $63.4 million;

•Improvements to real estate of $22.0 million;

•Proceeds from the sale of real estate equity securities of $16.4 million; and

•Payments on development obligations of $7.3 million.

Cash Flows from Financing Activities

Net cash used in financing activities was $104.8 million for the nine months ended September 30, 2024 and consisted primarily of the following:

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (continued)

•Principal payments on notes and bonds payable of $273.2 million, primarily related to the Series B bonds payments of approximately $190.3 million and payoff of the Lofts at NoHo Commons Mortgage Loan of approximately $68.5 million; and

•Proceeds from notes and bonds payable of $179.8 million, primarily related to proceeds received from the Series D bonds of approximately $156.8 million and the Eight & Nine Corporate Centre Mortgage Loan of approximately $20.0 million.

In order to execute our investment strategy, we utilize secured debt, and we may, to the extent available, utilize unsecured debt, to finance a portion of our investment portfolio. Management remains vigilant in monitoring the risks inherent with the use of debt in our portfolio and is taking actions to ensure that these risks, including refinancing and interest risks, are properly balanced with the benefit of using leverage. There is no limitation on the amount we may borrow for any single investment. Our charter does not limit us from incurring debt until our aggregate borrowings would exceed 300% of our net assets, which approximates aggregate liabilities of 75% of the cost of our tangible assets (before deducting depreciation or other non-cash reserves); however, we may exceed that limit if a majority of the conflicts committee approves each borrowing in excess of our charter limitation and we disclose such borrowing to our common stockholders in our next quarterly report with an explanation from the conflicts committee of the justification for the excess borrowing. As of September 30, 2024, our borrowings and other liabilities were within the limits stated in our charter.

As of September 30, 2024, we had bonds outstanding of 1.4 billion Israeli new shekels (approximately $378.5 million as of September 30, 2024) (“Series Bonds”), of which 360.0 million Israeli new shekels (approximately $96.6 million as of September 30, 2024) were collateralized by real estate (specified lands in Park Highlands and Richardson). The Series Bonds principal payments ranging from January 2025 to February 2029 with interest rates ranging from 3.93% to 9.50%. On August 20, 2024, Pacific Oak SOR BVI issued 299.0 million Israeli new shekels of Series D bonds (the “Series D Expansion”) to Israeli investors pursuant to a public offering registered with the Israel Securities Authority. The Series D Expansion had an equal level of security, pari passu, amongst themselves and between them and the existing Series D bonds without any right of precedence or preference between any of them. On September 19, 2024, we prepaid approximately 312.8 million Israeli new shekels of the January 31, 2025 Series B bond payment, with 75.4 million Israeli new shekels outstanding. Subsequent to September 30, 2024, we sold parcels of collateralized Park Highlands undeveloped land, refer to Subsequent Events, below for additional details.

Contractual Commitments and Contingencies

The following is a summary of our contractual obligations as of September 30, 2024 (in thousands):

			Payments Due During the Years Ending December 31,
Contractual Obligations	Total		Remainder of 2024		2025-2026		2027-2028		Thereafter
Outstanding debt obligations (1)	$	943,226	$	72,772	$	712,930	$	105,016	$	52,508
Interest payments on outstanding debt obligations (2)	123,000		25,047		80,494		16,628		831
Finance lease obligation (3)	53,046		90		789		792		51,375
Capital Commitments (4)	13,277		13,277		—		—		—
Development obligations (5)	3,880		3,880		—		—		—

_____________________

(1) Amounts include principal payments based on the outstanding principal amounts, maturity dates and foreign currency rates in effect as of September 30, 2024.

(2) Projected interest payments are based on the outstanding principal amounts, maturity dates, foreign currency rates and interest rates in effect as of September 30, 2024.

(3) Amounts are related to a leasehold interest expiring on 2114.

(4) Subsequent to September 30, 2024, the remaining commitment amount of $13.3 million was funded.

(5) Amounts are development obligations related to previous sales of Park Highlands undeveloped land.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (continued)

Results of Operations

Overview

As of September 30, 2024, we consolidated nine office complexes, encompassing, in the aggregate, approximately 3.2 million rentable square feet, one residential home portfolio consisting of 2,145 residential homes, one apartment property containing 317 units, one hotel property with 196 rooms, four investments in undeveloped land with approximately 581 developable acres, one office/retail development property, held an interest in three investments in unconsolidated entities and one investment in real estate equity securities.

Our results of operations for the three and nine months ended September 30, 2024, may not be indicative of those in future periods due to acquisition and disposition activities. Additionally, the occupancy in our office complexes has not been stabilized. As of September 30, 2024, our office complexes were collectively 66% occupied, our residential home portfolio was 94% occupied and our apartment property was 95% occupied. However, due to the amount of near-term lease expirations, we do not put significant emphasis on quarterly changes in occupancy (positive or negative) in the short run. Our underwriting and valuations are generally more sensitive to “terminal values” that may be realized upon the disposition of the assets in the portfolio and less sensitive to ongoing cash flows generated by the portfolio in the years leading up to an eventual sale. There are no guarantees that the occupancy of our assets will increase, or that we will recognize a gain on the sale of our assets. In general, we expect that our income and expenses related to our portfolio will increase in future periods as a result of leasing additional space and acquiring additional assets but decrease due to disposition activity.

Comparison of the three months ended September 30, 2024 versus the three months ended September 30, 2023

The following table provides summary information about our results of operations for the three months ended September 30, 2024 and 2023 (dollar amounts in thousands):

	Three Months Ended September 30,				Increase (Decrease)		Percentage Change		$ Change Due to Acquisitions/Dispositions (1)	Change Due to Investments Held Throughout Both Periods (2)
	2024		2023
Rental income	$	30,223	$	31,872	$	(1,649)	(5)	%	(1,498)
Hotel revenues	1,186		1,195		(9)		(1)	%	—	(9)
Other operating income	1,028		1,094		(66)		(6)	%	—	(66)
Dividend income from real estate equity securities	—		1,685		(1,685)		(100)	%	(81)	(1,604)
Operating, maintenance, and management	11,791		12,102		(311)		(3)	%	(269)	(42)
Real estate taxes and insurance	5,618		6,281		(663)		(11)	%	(323)	(340)
Hotel expenses	1,363		1,330		33		2	%	—	33
Asset management fees to affiliates	3,901		3,696		205		6	%	(164)	369
General and administrative expenses	2,314		1,952		362		19	%	n/a	n/a
Foreign currency transaction loss, net	4,556		1,123		3,433		306	%	n/a	n/a
Depreciation and amortization	10,276		12,399		(2,123)		(17)	%	(611)	(1,512)
Interest expense, net	20,585		17,928		2,657		15	%	(509)	3,166
Impairment charges on real estate and related intangibles	15,800		28,260		(12,460)		(44)	%	n/a	n/a
Loss from unconsolidated entities, net	(9,801)		(10,405)		604		(6)	%	—	604
Other interest income	379		639		(260)		(41)	%	n/a	n/a
Gain (loss) on real estate equity securities, net	8,726		(3,331)		12,057		(362)	%	93	11,964
Loss on sale of real estate, net	(1,243)		(221)		(1,022)		462	%	(1,022)	n/a

All values are in US Dollars.

_____________________

(1) Represents the dollar amount increase (decrease) for the three months ended September 30, 2024, compared to the three months ended September 30, 2023 related to real estate and real estate-related investments acquired or disposed on or after October 1, 2023.

(2) Represents the dollar amount increase (decrease) for the three months ended September 30, 2024, compared to the three months ended September 30, 2023 with respect to real estate and real estate-related investments owned by us during the entirety of both periods presented.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (continued)

Rental income decreased to $30.2 million for the three months ended September 30, 2024, from $31.9 million for the three months ended September 30, 2023, primarily due to the disposition of residential homes and one apartment property, which resulted in a decrease in rental income of approximately $1.1 million and $0.4 million, respectively. The occupancy rates and income within the residential homes segment remained consistent for the three months ended September 30, 2024 and 2023; however, there was a slight decrease in occupancy rates for the strategic opportunistic properties. Additionally, the rental income per square foot for our strategic opportunistic properties remained consistent for the three months ended September 30, 2024 and 2023. We expect rental income to increase in future periods as a result of new lease activity and to the extent we acquire additional properties, but to decrease to the extent we dispose of properties or from naturally expiring leases.

Foreign currency transaction loss, net increased to $4.6 million for the three months ended September 30, 2024 from a $1.1 million foreign currency transaction loss, net for the three months ended September 30, 2023, primarily due to the outstanding Series Bonds being denominated in Israeli new shekel and slightly less favorable exchange rates during the three months ended September 30, 2024. We expect to recognize foreign transaction gains and losses due to changes in the value of the U.S. dollar relative to the Israeli new shekel, which may be offset with foreign currency derivative hedges in future periods, and changes in the level of foreign currency exposure.

Interest expense, net increased to $20.6 million for the three months ended September 30, 2024, from $17.9 million for the three months ended September 30, 2023, primarily due to the increase in the weighted-average variable rate to 8.0% as of September 30, 2024, from 7.9% as of September 30, 2023. Additionally, the weighted-average fixed rate increased to 6.3% as of September 30, 2024, from 4.8% as of September 30, 2023, primarily due to the issuance of the Series D bonds of $157.5 million with a fixed interest rate of 9.5% and payment of the Series B bonds of $180.9 million with a fixed interest rate of 3.93%. We anticipate interest expense will continue to increase in 2024 as a result of the effect of higher average market interest rates on our variable-rate debt, since interest rates are expected to plateau and then start to decrease at a slower rate compared to how quickly they increased throughout 2023. Our interest expense in future periods will vary based on interest rates on variable and fixed rate debt, the amount of interest capitalized, level of future borrowings, interest rate derivative instruments, and the impact of refinancing efforts.

Impairment charges on real estate and related intangibles decreased to $15.8 million for the three months ended September 30, 2024 from $28.3 million for the three months ended September 30, 2023. We impaired three strategic opportunistic properties and one hotel during the three months ended September 30, 2024 due to declines in market conditions and projected cash flows, changes in sales comparisons, and also based on a quoted price. We impaired three strategic opportunistic properties during the three months ended September 30, 2023 due to increases in the discount and cap rate assumptions, decreases in projected cash flows and changes in sales comparisons.

Loss from unconsolidated entities of $9.8 million during the three months ended September 30, 2024 primarily consists of a loss of $9.3 million from the 110 William Joint Venture and no income or loss was recognized related to the 353 Sacramento Joint Venture due to the suspension of the equity method of accounting. The loss from unconsolidated entities, net of $10.4 million during the three months ended September 30, 2023 consists of a loss of $26.3 million from the 353 Sacramento Joint Venture, primarily due to our share of impairment charges on real estate and related intangibles of $22.7 million and partially offset by income of $15.3 million from the 110 William Joint Venture, which is primarily due to recognizing a gain on extinguishment of debt of $71.6 million and partially offset by our share of accumulated losses recognized of $56.3 million.

Gain on real estate equity securities, net increased to $8.7 million for the three months ended September 30, 2024, from a loss on real estate equity securities, net of $3.3 million for the three months ended September 30, 2023, primarily related to the change in the fair value of our real estate equity securities held and sold during these periods. We expect gains and losses on real estate equity securities to fluctuate in future periods as a result of changes in share prices and the level of our investments in real estate equity securities.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (continued)

Comparison of the nine months ended September 30, 2024 versus the nine months ended September 30, 2023

The following table provides summary information about our results of operations for the nine months ended September 30, 2024 and 2023 (dollar amounts in thousands):

	Nine Months Ended September 30,				Increase (Decrease)		Percentage Change		$ Change Due to Acquisitions/ Dispositions (1)	Change Due to Investments Held Throughout Both Periods (2)
	2024		2023
Rental income	$	92,045	$	96,101	$	(4,056)	(4)	%	(4,079)
Hotel revenues	6,225		6,673		(448)		(7)	%	—	(448)
Other operating income	2,896		3,299		(403)		(12)	%	—	(403)
Dividend income from real estate equity securities	81		3,795		(3,714)		(98)	%	(337)	(3,377)
Operating, maintenance, and management	33,877		34,377		(500)		(1)	%	(1,086)	586
Real estate taxes and insurance	18,649		18,541		108		1	%	(868)	976
Hotel expenses	5,016		5,275		(259)		(5)	%	—	(259)
Asset management fees to affiliates	11,875		11,380		495		4	%	(615)	1,110
General and administrative expenses	10,108		8,176		1,932		24	%	753	1,179
Foreign currency transaction (gain) loss, net	(6,724)		4,675		(11,399)		(244)	%	n/a	n/a
Depreciation and amortization	31,405		36,556		(5,151)		(14)	%	(1,342)	(3,809)
Interest expense, net	55,366		49,747		5,619		11	%	(1,234)	6,853
Impairment charges on real estate and related intangibles	76,090		64,849		11,241		17	%	n/a	n/a
Loss from unconsolidated entities	(26,531)		(27,367)		836		(3)	%	—	836
Other interest income	1,117		1,855		(738)		(40)	%	n/a	n/a
Loss on real estate equity securities, net	(7,905)		(19,453)		11,548		(59)	%	(25,776)	37,324
(Loss) gain on sale of real estate, net	(624)		32,541		(33,165)		(102)	%	(33,165)	n/a
Income tax provision	—		(3,662)		3,662		100	%	3,662	n/a

All values are in US Dollars.

_____________________

(1) Represents the dollar amount increase (decrease) for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023 related to real estate and real estate-related investments acquired or disposed on or after October 1, 2023.

(2) Represents the dollar amount increase (decrease) for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023 with respect to real estate and real estate-related investments owned by us during the entirety of both periods presented.

Rental income decreased to $92.0 million for the nine months ended September 30, 2024, from $96.1 million for the nine months ended September 30, 2023, primarily due to the disposition of residential homes and one apartment property, which resulted in a decrease in rental income of approximately $3.8 million and $0.3 million, respectively. The occupancy rates and income within the residential homes segments remained consistent for the nine months ended September 30, 2024 and 2023; however, there was a slight decrease in occupancy rates for the strategic opportunistic properties. Additionally, the average rental income per square foot for our strategic opportunistic properties remained consistent for the nine months ended September 30, 2024 and 2023. We expect rental income to increase in future periods as a result of new lease activity and to the extent we acquire additional properties, but to decrease to the extent we dispose of properties or from naturally expiring leases.

Foreign currency transaction gain, net increased to $6.7 million for the nine months ended September 30, 2024 from a $4.7 million foreign currency transaction loss, net for the nine months ended September 30, 2023, primarily due to the outstanding Series Bonds being denominated in Israeli new shekels and more favorable exchange rates during the nine months ended September 30, 2024. We expect to recognize foreign transaction gains and losses due to changes in the value of the U.S. dollar relative to the Israeli new shekel, which may be offset with foreign currency derivative hedges in future periods, and changes in the level of foreign currency exposure.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (continued)

Interest expense, net increased to $55.4 million for the nine months ended September 30, 2024, from $49.7 million for the nine months ended September 30, 2023, primarily due to the increase in the weighted-average variable rate to 8.0% as of September 30, 2024, from 7.9% as of September 30, 2023. Additionally, the weighted-average fixed rate increased to 6.3% as of September 30, 2024, from 4.8% as of September 30, 2023, primarily due to the issuance of the Series C bonds of $99.5 million with a fixed interest rate of 9.0%, the Series D bonds of $157.5 million with a fixed interest rate of 9.5% and payment of the $180.9 million Series B bonds with a fixed interest rate of 3.93%. We anticipate interest expense will continue to increase in 2024 as a result of higher average market interest rates on our variable-rate debt as interest rates are expected to plateau and then start to decrease at a slower rate compared to how quickly they increased throughout 2023. Our interest expense in future periods will vary based on interest rates on variable and fixed rate debt, the amount of interest capitalized, level of future borrowings, interest rate derivative instruments, and the impact of refinancing efforts.

Impairment charges on real estate and related intangibles increased to $76.1 million for the nine months ended September 30, 2024 from $64.8 million for the nine months ended September 30, 2023. We impaired five strategic opportunistic properties and one hotel during the nine months ended September 30, 2024 due to declines in market conditions and projected cash flows, changes in sales comparisons, and also based on a quoted price. We impaired three strategic opportunistic properties during the nine months ended September 30, 2023 due to increases in discount and cap rate assumptions, decreases in projected cash flows and changes in sales comparisons.

Loss from unconsolidated entities of $26.5 million during the nine months ended September 30, 2024 primarily consists of a loss of $25.4 million from the 110 William Joint Venture and no income or loss was recognized related to the 353 Sacramento Joint Venture due to the suspension of the equity method of accounting. The loss from unconsolidated entities, net of $27.4 million during the nine months ended September 30, 2023 consists of a loss of $44.0 million for the 353 Sacramento Joint Venture, primarily due to impairment charge on the 353 Sacramento Joint Venture of $14.8 million and increases in our share of interest expense and impairment charges on real estate of $3.5 million and $22.7 million, respectively, and partially offset by income of $15.3 million from the 110 William Joint Venture, which is primarily due to recognizing a gain on extinguishment of debt of $71.6 million and partially offset by our share of accumulated losses recognized of $60.1 million.

Loss on real estate equity securities, net decreased to $7.9 million for the nine months ended September 30, 2024, from $19.5 million for the nine months ended September 30, 2023, primarily related to the change in the fair value of our real estate equity securities held and sold during these periods. We expect gains and losses on real estate equity securities to fluctuate in future periods as a result of changes in share prices and level of our investments in real estate equity securities.

Funds from Operations, Modified Funds from Operations and Adjusted Modified Funds from Operations

We believe that funds from operations (“FFO”) is a beneficial indicator of the performance of an equity REIT. We compute FFO in accordance with the current National Association of Real Estate Investment Trusts (“NAREIT”) definition. FFO represents net income, excluding gains and losses from sales of real estate assets (which can vary among owners of identical assets in similar conditions based on historical cost accounting and useful-life estimates), impairment losses on real estate assets, depreciation and amortization of real estate assets, and adjustments for unconsolidated partnerships and joint ventures. In addition, we elected the option to exclude mark-to-market changes in value recognized on equity securities in the calculation of FFO. We believe FFO facilitates comparisons of operating performance between periods and among other REITs. However, our computation of FFO may not be comparable to other REITs that do not define FFO in accordance with the NAREIT definition or that interpret the current NAREIT definition differently than we do. Our management believes that historical cost accounting for real estate assets in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”) implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values have historically risen or fallen with market conditions, many industry investors and analysts have considered the presentation of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. As a result, we believe that the use of FFO, together with the required GAAP presentations, provides a more complete understanding of our performance relative to our competitors and provides a more informed and appropriate basis on which to make decisions involving operating, financing, and investing activities.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (continued)

Changes in accounting rules have resulted in a substantial increase in the number of non-operating and non-cash items included in the calculation of FFO. As a result, our management also uses modified funds from operations (“MFFO”) as an indicator of our ongoing performance as well as our dividend sustainability. MFFO excludes from FFO: acquisition fees and expenses (to the extent that such fees and expenses have been recorded as operating expenses); adjustments related to contingent purchase price obligations; amounts relating to straight-line rents and amortization of above- and below-market intangible lease assets and liabilities; accretion of discounts and amortization of premiums on debt investments; amortization of closing costs relating to debt investments; impairments of real estate-related investments; mark-to-market adjustments included in net income; and gains or losses included in net income for the extinguishment or sale of debt or hedges. We compute MFFO in accordance with the definition of MFFO included in the practice guideline issued by the Institute for Portfolio Alternatives (“IPA”) in November 2010 as interpreted by management. Our computation of MFFO may not be comparable to other REITs that do not compute MFFO in accordance with the current IPA definition or that interpret the current IPA definition differently than we do.

In addition, our management uses an adjusted MFFO (“Adjusted MFFO”) as an indicator of our ongoing performance, as well as our dividend sustainability. Adjusted MFFO provides adjustments to reduce MFFO related to operating expenses that are capitalized with respect to certain of our investments in undeveloped land.

We believe that MFFO and Adjusted MFFO are helpful as measures of ongoing operating performance because they exclude costs that management considers more reflective of investing activities and other non-operating items included in FFO. Management believes that excluding acquisition costs, prior to our early adoption of ASU No. 2017-01 on January 1, 2017, from MFFO and Adjusted MFFO provides investors with supplemental performance information that is consistent with management’s analysis of the operating performance of the portfolio over time, including periods after our acquisition stage. MFFO and Adjusted MFFO also exclude non-cash items such as straight-line rental revenue. Additionally, we believe that MFFO and Adjusted MFFO provide investors with supplemental performance information that is consistent with the performance indicators and analysis used by management, in addition to net income and cash flows from operating activities as defined by GAAP, to evaluate the sustainability of our operating performance. MFFO provides comparability in evaluating the operating performance of our portfolio with other non-traded REITs which typically have limited lives with short and defined acquisition periods and targeted exit strategies. MFFO, or an equivalent measure, is routinely reported by non-traded REITs, and we believe often used by analysts and investors for comparison purposes.

FFO, MFFO and Adjusted MFFO are non-GAAP financial measures and do not represent net income as defined by GAAP. Net income as defined by GAAP is the most relevant measure in determining our operating performance because FFO, MFFO and Adjusted MFFO include adjustments that investors may deem subjective, such as adding back expenses such as depreciation and amortization and the other items described above. Accordingly, FFO, MFFO and Adjusted MFFO should not be considered as alternatives to net income as an indicator of our current and historical operating performance. In addition, FFO, MFFO and Adjusted MFFO do not represent cash flows from operating activities determined in accordance with GAAP and should not be considered an indication of our liquidity. We believe FFO, MFFO and Adjusted MFFO, in addition to net income and cash flows from operating activities as defined by GAAP, are meaningful supplemental performance measures.

Although MFFO includes other adjustments, the exclusion of straight-line rent, the amortization of above- and below-market leases, amortization of premium or discount on bond and notes payable, mark-to-market foreign currency transaction adjustments and extinguishment of debt are the most significant adjustments for the periods presented. We have excluded these items based on the following economic considerations:

•Adjustments for straight-line rent. These are adjustments to rental revenue as required by GAAP to recognize contractual lease payments on a straight-line basis over the life of the respective lease. We have excluded these adjustments in our calculation of MFFO to more appropriately reflect the current economic impact of our in-place leases, while also providing investors with a useful supplemental metric that addresses core operating performance by removing rent we expect to receive in a future period or rent that was received in a prior period;

•Amortization of above- and below-market leases. Similar to depreciation and amortization of real estate assets and lease related costs that are excluded from FFO, GAAP implicitly assumes that the value of intangible lease assets and liabilities diminishes predictably over time and requires that these charges be recognized currently in revenue. Since market lease rates in the aggregate have historically risen or fallen with local market conditions, management believes that by excluding these charges, MFFO provides useful supplemental information on the realized economics of the real estate;

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (continued)

•Amortization of premium and discount on notes and bonds payable. These are net adjustments to interest expense as required by GAAP to recognize notes and bonds payable discount and premiums on a straight-line basis over the life of the respective notes and bonds payable. We have excluded these adjustments in our calculation of MFFO to appropriately reflect the current economic impact of our bond and notes payable and related interest expense;

•Unrealized gain or loss from interest rate caps. These adjustments include unrealized gains from mark-to-market adjustments on interest rate caps. The change in fair value of interest rate caps not designated as a hedge are non-cash adjustments recognized directly in earnings and are included in interest expense. We have excluded these adjustments in our calculation of MFFO to more appropriately reflect the economic impact of our interest rate cap agreements; and

•Mark-to-market foreign currency transaction adjustments. The U.S. Dollar is our functional currency. Transactions denominated in currency other than our functional currency are recorded upon initial recognition at the exchange rate on the date of the transaction. After initial recognition, monetary assets and liabilities denominated in foreign currency are remeasured at each reporting date into the foreign currency at the exchange rate on that date. In addition, we have entered into foreign currency collars and foreign currency options that results in a foreign currency transaction adjustment. These amounts can increase or reduce net income. We exclude them from MFFO to more appropriately present the ongoing operating performance of our real estate investments on a comparative basis.

Adjusted MFFO includes adjustments to reduce MFFO primarily related to income tax provision, as well as real estate taxes, property insurance, and financing costs which are capitalized with respect to certain of our investments in undeveloped land.

Our calculation of FFO, which we believe is consistent with the calculation of FFO as defined by NAREIT, is presented in the following table, along with our calculations of MFFO and Adjusted MFFO, for the three and nine months ended September 30, 2024 and 2023 (in thousands). No conclusions or comparisons should be made from the presentation of these periods.

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2024		2023		2024		2023
Net loss attributable to common stockholders	$	(43,725)	$	(60,232)	$	(164,419)	$	(137,288)
Depreciation and amortization	10,276		12,399		31,405		36,557
Impairment charges on real estate and related intangibles	15,800		28,260		76,090		64,849
Loss (gain) on sale of real estate	1,243		221		624		(32,541)
(Gain) loss on real estate equity securities, net	(8,726)		3,331		7,905		19,453
Adjustments for noncontrolling interests (1)	(1,822)		(1,162)		(3,657)		(1,231)
Adjustments for investments in unconsolidated entities (2)	860		27,355		3,351		34,723
FFO attributable to common stockholders	(26,094)		10,172		(48,701)		(15,478)
Straight-line rent and amortization of above- and below-market leases	(556)		827		(1,047)		(1,014)
Amortization of premium and discount on notes and bonds payable, net	905		1,082		2,750		3,267
Unrealized gain on interest rate caps	231		(51)		(186)		(378)
Foreign currency transaction loss (gain), net	4,556		1,123		(6,724)		4,675
Adjustments for noncontrolling interests (1)	21		(4)		4		(10)
Adjustments for investments in unconsolidated entities (2)	208		441		774		1,252
MFFO attributable to common stockholders	(20,729)		13,590		(53,130)		(7,686)
Other capitalized operating expenses (3)	(1,590)		(1,227)		(4,363)		(3,229)
Income tax provision	—		—		—		3,662
Adjusted MFFO attributable to common stockholders	$	(22,319)	$	12,363	$	(57,493)	$	(7,253)

_____________________

(1) Reflects adjustments to eliminate the noncontrolling interest holders’ share of the adjustments to convert our net loss attributable to common stockholders to FFO, MFFO and Adjusted MFFO.

(2) Reflects adjustments to add back our noncontrolling interest share of the adjustments to convert our net loss attributable to common stockholders to FFO, MFFO and Adjusted MFFO for our equity investments in unconsolidated entities.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (continued)

(3) Reflects real estate taxes, property insurance and financing costs capitalized with respect to certain of our investments in undeveloped land and unconsolidated entity. During the periods in which we are incurring costs necessary to bring these investments to their intended use, certain normal recurring operating costs are capitalized in accordance with GAAP and not reflected in our net loss, FFO and MFFO.

FFO, MFFO and Adjusted MFFO may also be used to fund all or a portion of certain capitalizable items that are excluded from FFO, MFFO and Adjusted MFFO, such as tenant improvements, building improvements and deferred leasing costs. We expect FFO, MFFO and Adjusted MFFO to improve in future periods to the extent that we continue to lease up vacant space and acquire additional assets. We expect FFO, MFFO and Adjusted MFFO to decrease as a result of dispositions.

Critical Accounting Policies

Our consolidated interim financial statements have been prepared in accordance with GAAP and in conjunction with the rules and regulations of the SEC. The preparation of our financial statements requires significant management judgments and assumptions, requires estimates about matters that are inherently uncertain and which are important for understanding and evaluating our reported financial results. These judgments will affect the reported amounts of assets and liabilities and our disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods. With different estimates or assumptions, materially different amounts could be reported in our financial statements. Additionally, other companies may utilize different estimates that may impact the comparability of our results of operations to those of companies in similar businesses. A discussion of the accounting policies that management considers critical in that they involve significant management judgments, assumptions and estimates is included in our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC. There have been no significant changes to our policies during 2024.

Subsequent Events

We evaluate subsequent events up until the date the consolidated financial statements are issued.

Park Highlands Land

In October 2024, we, through an indirect wholly owned subsidiary, sold approximately 122 developable acres of Park Highlands undeveloped land for gross sale proceeds of approximately $75.5 million, before net closing costs and credits. Part of the Park Highlands undeveloped land was used as collateral for the Series C bonds and due to the sale, approximately $10.6 million of the sales proceeds will be held in a deposit account to be applied towards the Series C bonds payment. The purchaser is not affiliated with us or our advisor.

Residential Homes Sale

In October 2024, we, through an indirect wholly owned subsidiary, sold 45 residential homes for gross sale proceeds of approximately $8.3 million, before closing costs and credits. In connection with the sale, we repaid $3.2 million of the outstanding principal due under the secured mortgage loan. The purchaser is not affiliated with us or our advisor.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Foreign Currency, Interest Rate and Financial Market Risk

Certain transactions, assets, and liabilities are exposed to foreign currency risk. We monitor our foreign currency exposures to maximize the economic effectiveness of our foreign currency positions, including hedges. Principal currency exposure is Israeli new shekel; in particular, we are exposed to the effects of foreign currency changes in Israel with respect to the bonds issued to investors in Israel.

In addition, we are exposed to the effects of interest rate changes as a result of borrowings used to maintain liquidity, fund distributions and to fund the refinancing of our real estate investment portfolio and operations. We may also be exposed to the effects of changes in interest rates as a result of the acquisition and origination of mortgage, bonds, and other loans and the acquisition of real estate securities. Our profitability and the value of our investment portfolio may be adversely affected during any period as a result of interest rate changes. Our interest rate risk management objectives are to limit the impact of interest rate changes on earnings, prepayment penalties and cash flows and to lower overall borrowing costs. We may manage interest rate risk by maintaining a ratio of fixed rate, long-term debt such that floating rate exposure is kept at an acceptable level. We may also utilize a variety of financial instruments, including interest rate caps, floors, and swap agreements, in order to limit the effects of changes in interest rates on our operations. Additionally, certain of these strategies may reduce the funds available for payments to holders of our common stock.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 3. Quantitative and Qualitative Disclosures about Market Risk (continued)

In addition, our profitability and the value of our investment portfolio may be adversely affected during any period as a result of foreign currency changes. In order to limit the effects of changes in foreign currency on our operations, we may utilize a variety of foreign currency hedging strategies such as cross currency swaps, forward contracts, puts or calls. When we use these types of derivatives to hedge the risk of interest-earning assets or interest-bearing liabilities, we may be subject to certain risks, including the risk that losses on a hedge position will reduce the funds available for payments to holders of our common stock and the risk that the losses may exceed the amount we invested in the instruments. Additionally, certain of these strategies may cause us to fund a margin account periodically to offset changes in foreign currency rates which may also reduce the funds available for payments to holders of our common stock.

As of September 30, 2024, we held 33.4 million Israeli new shekels and 10.9 million Israeli new shekels in cash and restricted cash, respectively. In addition, as of September 30, 2024, we had Series Bonds outstanding and the related interest payable in the amounts of 1.4 billion Israeli new shekels and 16.7 million Israeli new shekels, respectively. Foreign currency exchange rate risk is the possibility that our financial results could be better or worse than planned because of changes in foreign currency exchange rates. Based solely on the remeasurement for the nine months ended September 30, 2024, if foreign currency exchange rates were to increase or decrease by 10%, our net loss would increase or decrease by approximately $38.4 million for the same period. The foreign currency transaction income or loss may be impacted by changes in foreign currency exchange rates, levels at which we hold foreign currency, and future foreign currency collar investments.

We borrow funds at a combination of fixed and variable rates. Interest rate fluctuations will generally not affect our future earnings or cash flows on our fixed rate debt unless such instruments mature or are otherwise terminated. However, interest rate changes will affect the fair value of our fixed rate instruments. As of September 30, 2024, the fair value of our bonds was $376.1 million and the outstanding principal balance was $378.5 million. The fair value estimates of the Series Bonds were calculated using the quoted bond price as of September 30, 2024 on the Tel Aviv Stock Exchange of 96.46, 105.21 and 100.91 Israeli new shekels, respectively. As of September 30, 2024, excluding the Series Bonds, the fair value of our fixed rate debt was $212.2 million and the outstanding principal balance of our fixed rate debt was $215.8 million. The fair value estimate of our fixed rate debt, excluding the Series Bonds, was calculated using a discounted cash flow analysis utilizing rates we would expect to pay for debt of a similar type and remaining maturity if the loans were originated as of September 30, 2024. As we expect to hold our fixed rate instruments to maturity and the amounts due under such instruments would be limited to the outstanding principal balance and any accrued and unpaid interest, we do not expect that fluctuations in interest rates, and the resulting changes in fair value of our fixed rate instruments, would have a significant impact on our operations.

Conversely, movements in interest rates on variable rate debt would change our future earnings and cash flows but would not significantly affect the fair value of those instruments. However, changes in required risk premiums would result in changes in the fair value of floating rate instruments. As of September 30, 2024, we had entered into two separate interest rate caps with an aggregate notional amount of $78.2 million which effectively limits our exposure to increases in one-month Secured Overnight Finance Rate (“SOFR”) above certain thresholds. Based on interest rates as of September 30, 2024, if interest rates were 100 basis points higher or lower during the 12 months ending September 30, 2024, interest expense on our variable rate debt would increase or decrease by $2.7 million and $2.8 million, respectively.

The weighted-average interest rates of our fixed rate debt and variable rate debt as of September 30, 2024 were 6.3% and 8.0%, respectively. The interest rate and weighted-average interest rate represent the actual interest rate in effect as of September 30, 2024 (consisting of the contractual interest rate and the effect of contractual floor rates, if applicable), using interest rate indices as of September 30, 2024 where applicable.

We are exposed to financial market risk with respect to our real estate equity securities. Financial market risk is the risk that we will incur economic losses due to adverse changes in our real estate equity security prices. Our exposure to changes in real estate equity security prices is a result of our investment in these types of securities. Market prices are subject to fluctuation and, therefore, the amount realized in the subsequent sale of an investment may significantly differ from the reported market value. Fluctuation in the market prices of a real estate equity security may result from any number of factors, including perceived changes in the underlying fundamental characteristics of the issuer, the relative price of alternative investments, interest rates, default rates and general market conditions. In addition, amounts realized in the sale of a particular security may be affected by the relative quantity of the real estate equity security being sold. We do not currently engage in derivative or other hedging transactions to manage our real estate equity security price risk. As of September 30, 2024, we owned real estate equity securities with a book value of $17.3 million. Based solely on the prices of real estate equity securities as of September 30, 2024, if prices were to increase or decrease by 10%, our net loss would increase or decrease by approximately $1.7 million.

Table of Contents

PART I. FINANCIAL INFORMATION (CONTINUED)

Item 4. Controls and Procedures

Disclosure Controls and Procedures

As of the end of the period covered by this report, management, including our Chief Executive Officer (CEO) and Chief Financial Officer (CFO), who are our principal executive officer and principal financial officer, respectively, evaluated the effectiveness of the design and operation of our disclosure controls and procedures. Based upon that evaluation, our CEO and CFO concluded that the disclosure controls and procedures were ineffective as of the end of the period covered by this report since the material weakness in the design and operation of our management review controls, previously described in Part II, Item 9A of our Annual Report on Form 10-K for the year ended December 31, 2023, was not yet remediated as of September 30, 2024.

Notwithstanding the identified material weakness previously described in our Annual Report on Form 10-K, our management, including our CEO and CFO, does not believe that this deficiency had an adverse effect on our reported operating results or financial condition, and has concluded that our financial statements and other financial information included in this Quarterly Report on Form 10-Q presents fairly, in all material respects, our financial condition, results of operations, and cash flows for the periods presented in accordance with generally accepted accounting principles in the United States.

Remediation

As previously disclosed, we have initiated a comprehensive plan to remediate this material weakness. The remediation actions include review measures to enhance controls related to non-pro rata profit or loss allocations for our investments in unconsolidated entities and consultations with external accounting experts for non-recurring, significant, and/or unusual transactions. We believe that these actions will remediate the material weakness. The weakness will not be considered remediated, however, until the controls operate for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively. We expect that the remediation of this material weakness will be completed at the end of 2024.

Internal Control Over Financial Reporting

Except for the changes described above, there were no changes in our internal control over financial reporting that occurred during the nine months ended September 30, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Table of Contents

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

None.

Item 1A. Risk Factors

Please see the risk factors in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2023, Part II, Item 1A of our Quarterly Report on Form 10-Q for the period ended March 31, 2024, and Part II, Item 1A of our Quarterly Report on Form 10-Q for the period ended June 30, 2024, each as filed with the SEC.

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

a)During the period covered by this Form 10-Q, we did not sell any equity securities that were not registered under the Securities Act of 1933, as amended.

b)Not applicable.

c)We previously adopted a share redemption program that may enable stockholders to sell their shares to us in limited circumstances and the plan was indefinitely suspended effective July 30, 2024.

During the nine months ended September 30, 2024 and prior to the suspension of the share redemption program, we fulfilled redemption requests eligible for redemption under our share redemption program and received in good order and funded redemptions with cash on hand. We redeemed shares pursuant to our share redemption program as follows:

Month	Total Number<br><br>of Shares Redeemed	Average Price Paid<br><br>Per Share (1)		Approximate Dollar Value of Shares Available That May Yet Be Redeemed Under the Program
January	24,373	$	8.03	(2)
February	28,416	$	8.03	(2)
March	43,052	$	8.03	(2)
April	55,492	$	8.03	(2)
May	121,273	$	8.03	(2)
June	21,074	$	8.03	(2)
Total	293,680

_____________________

(1) On November 30, 2023 our board of directors approved an estimated value per share of our common stock of $8.03. The change in the redemption price became effective beginning with the December 2023 redemption date.

(2) During the nine months ended September 30, 2024, we redeemed $1.9 million of common stock under the program, which represented shares in connection with redemption requests made upon a stockholder’s death, “qualifying disability” or “determination of incompetence”. The program was indefinitely suspended effective July 30, 2024 and accordingly we did not redeem any shares under the program during August or September 2024.

In addition to the redemptions under the share redemption program described above, between July 24, 2024 and July 29, 2024, we repurchased an additional 65,573 shares of our common stock at a price of $8.03 per share for an aggregate price of $0.5 million.

Item 3. Defaults upon Senior Securities

None.

Item 4. Mine Safety Disclosures

None.

Item 5. Other Information

On November 7, 2024, we renewed the advisory agreement with our advisor effective November 1, 2024. The renewed advisory agreement is effective through November 1, 2025 and the terms are consistent with those of the advisory agreement that was previously in effect.

Table of Contents

PART II. OTHER INFORMATION (CONTINUED)

Item 6. Exhibits

Ex.	Description
3.1	Second Articles of Amendment and Restatement, incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed February 4, 2010
3.2	Articles of Amendment, incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed November 1, 2019
3.3	Articles of Amendment, incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed December 23, 2019
3.4	Fourth Amended and Restated Bylaws, incorporated by reference to Exhibit 3.4 to the Company’s Annual Report on Form 10-K filed March 30, 2023
4.1	Statement regarding restrictions on transferability of shares of common stock (to appear on stock certificate or to be sent upon request and without charge to stockholders issued shares without certificates), incorporated by reference to Exhibit 4.2 to Pre-Effective Amendment No. 1 to the Company’s Registration Statement on Form S-11, Commission File No. 333-156633 filed February 25, 2009
4.2	Fifth Amended and Restated Dividend Reinvestment Plan, incorporated by reference to Exhibit 4.2 to the Company’s Quarterly Report on Form 10-Q filed May 14, 2015
10.1	Advisory Agreement among Pacific Oak Residential Trust, Inc., PORT OP LP, Pacific Oak Residential Advisors, LLC, Pacific Oak Capital Advisors, LLC, Keith D. Hall and Peter McMillan III, effective as of September 1, 2024, dated September 5, 2024, incorporated by reference to Exhibit 10.1 to Current Report on Form 8 K, Commission File No. 000-54382 filed September 5, 2024
10.2	Third Amendment to Purchase and Sale Agreement and Joint Escrow Instructions by and among Pacific Oak SOR Tule Springs Owner TRS, LLC, Pacific Oak SOR Tule Springs Village 2 Parcels Owner, LLC, and KB Home Las Vegas Inc., dated August 16, 2024
10.3	Fourth Amendment to Purchase and Sale Agreement and Joint Escrow Instructions by and among Pacific Oak SOR Tule Springs Owner TRS, LLC, Pacific Oak SOR Tule Springs Village 2 Parcels Owner, LLC, and KB Home Las Vegas Inc., dated September 17, 2024
10.4	Fifth Amendment to Purchase and Sale Agreement and Joint Escrow Instructions by and among Pacific Oak SOR Tule Springs Owner TRS, LLC, Pacific Oak SOR Tule Springs Village 2 Parcels Owner, LLC, and KB Home Las Vegas Inc., dated September 30, 2024
10.5	Sixth Amendment to Purchase and Sale Agreement and Joint Escrow Instructions by and among Pacific Oak SOR Tule Springs Owner TRS, LLC, Pacific Oak SOR Tule Springs Village 2 Parcels Owner, LLC, and KB Home Las Vegas Inc., dated October 14, 2024
10.6	Seventh Amendment to Purchase and Sale Agreement and Joint Escrow Instructions by and among Pacific Oak SOR Tule Springs Owner TRS, LLC, Pacific Oak SOR Tule Springs Village 2 Parcels Owner, LLC, and KB Home Las Vegas Inc., dated October 18, 2024
10.7	Deed of Trust between Pacific Oak SOR (BVI) Holdings Ltd. And Reznik Paz Nevo Trusts Ltd., dated April 21, 2024
10.8	Amendment No. 1 to the Deed of Trust between Pacific Oak SOR (BVI) Holdings Ltd. and Reznik Paz Nevo Trusts Ltd., dated September 2, 2024
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002
32.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002
99.1	Twelfth Amended and Restated Share Redemption Program, incorporated by reference to Exhibit 99.5 to the Company's Current Report on Form 8-K filed December 4, 2020

Table of Contents

PART II. OTHER INFORMATION (CONTINUED)

99.2	Amendment No. 1 to the Twelfth Amended and Restated Share Redemption Program, incorporated by reference to Exhibit 99.1 to the Company's Current Report on Form 8-K filed August 6, 2021
101.INS	Inline XBRL Instance Document
101.SCH	Inline XBRL Taxonomy Extension Schema
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase
104	Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101).

Table of Contents

SIGNATURES

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

		PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.
Date:	November 14, 2024	By:	/S/ KEITH D. HALL
			Keith D. Hall
			Chief Executive Officer and Director
			(principal executive officer)
Date:	November 14, 2024	By:	/S/ MICHAEL A. BENDER
			Michael A. Bender
			Chief Financial Officer
			(principal financial officer)

37

exhibit101-portxadvisory

Exhibit 10.1 ADVISORY AGREEMENT among PACIFIC OAK RESIDENTIAL TRUST, INC., PORT OP LP, PACIFIC OAK RESIDENTIAL ADVISORS, LLC, PACIFIC OAK CAPITAL ADVISORS, LLC, KEITH D. HALL, and PETER MCMILLAN III September 1, 2024 i CLOSED\1607203150.4 TABLE OF CONTENTS Page ARTICLE 1 DEFINITIONS .................................................................................................................. 1 ARTICLE 2 APPOINTMENT ............................................................................................................... 6 ARTICLE 3 DUTIES OF THE ADVISOR ........................................................................................... 7 3.01 Organizational and Offering Services .......................................................................................... 7 3.02 Acquisition Services .................................................................................................................... 7 3.03 Asset Management Services ........................................................................................................ 7 ARTICLE 4 AUTHORITY OF THE ADVISOR ................................................................................ 10 4.01 General ....................................................................................................................................... 10 4.02 Powers of the Advisor ................................................................................................................ 10 4.03 Approval by the Board ............................................................................................................... 10 4.04 Modification or Revocation of Authority of Advisor ................................................................ 10 ARTICLE 5 BANK ACCOUNTS ....................................................................................................... 10 ARTICLE 6 RECORDS AND FINANCIAL STATEMENTS ........................................................... 11 ARTICLE 7 LIMITATION ON ACTIVITIES .................................................................................... 11 ARTICLE 8 FEES ............................................................................................................................... 11 8.01 Acquisition Fees ......................................................................................................................... 11 8.02 Asset Management Fees............................................................................................................. 11 8.03 Disposition Fees ......................................................................................................................... 12 8.04 Incentive Fees ............................................................................................................................ 12 8.05 Legacy Incentive Fees ................................................................................................................ 12 8.06 Hall and McMillan Fee Reduction ............................................................................................. 13 8.07 Election of Payment in Shares ................................................................................................... 13 ARTICLE 9 EXPENSES ..................................................................................................................... 14 9.01 General ....................................................................................................................................... 14 9.02 Timing of and Additional Limitations on Reimbursements....................................................... 15 9.03 Advancement of Other Organization and Offering Expenses .................................................... 15 ARTICLE 10 RELATIONSHIP OF THE ADVISOR AND THE COMPANY; OTHER ACTIVITIES OF THE ADVISOR ................................................................................. 15 10.01 Relationship ............................................................................................................................... 15 10.02 Time Commitment ..................................................................................................................... 15 ARTICLE 11 THE PACIFIC OAK NAME .......................................................................................... 15 ARTICLE 12 CHANGE OF CONTROL .............................................................................................. 16 12.01 Change of Control ...................................................................................................................... 16 ARTICLE 13 TERM AND TERMINATION OF THE AGREEMENT ............................................... 16 13.01 Term ........................................................................................................................................... 16 13.02 Termination by Either Party ....................................................................................................... 16 13.03 Payments on Termination and Survival of Certain Rights and Obligations .............................. 16 ARTICLE 14 ASSIGNMENT ............................................................................................................... 17 ARTICLE 15 INDEMNIFICATION AND LIMITATION OF LIABILITY ........................................ 17 15.01 Indemnification .......................................................................................................................... 17 15.02 Limitation on Payment of Expenses .......................................................................................... 17 ii CLOSED\1607203150.4 ARTICLE 16 MISCELLANEOUS ....................................................................................................... 17 16.01 Notices ....................................................................................................................................... 17 16.02 Modification ............................................................................................................................... 18 16.03 Severability ................................................................................................................................ 18 16.04 Construction ............................................................................................................................... 18 16.05 Entire Agreement ....................................................................................................................... 18 16.06 Waiver ........................................................................................................................................ 18 16.07 Gender ........................................................................................................................................ 18 16.08 Titles Not to Affect Interpretation ............................................................................................. 18 16.09 Counterparts ............................................................................................................................... 18 1 CLOSED\1607203150.4 ADVISORY AGREEMENT This Advisory Agreement, entered into as of September 1, 2024 (this “Agreement”), is among Pacific Oak Residential Trust, Inc., a Maryland corporation (the “Company”); PORT OP LP, a Delaware limited partnership (the “Partnership”); Pacific Oak Residential Advisors, LLC, a Delaware limited liability company (the “Advisor”); for purposes of Article 8, Messrs. Keith D. Hall and Peter McMillan III; and for purposes of Article 9, Pacific Oak Capital Advisors, LLC, a Delaware limited liability company (the “Sponsor”). W I T N E S S E T H WHEREAS, the Company desires to avail itself of the knowledge, experience, sources of information, advice, assistance and certain facilities available to the Advisor and to have the Advisor undertake the duties and responsibilities set forth herein; and WHEREAS, the Advisor is willing to undertake to render these services on the terms and conditions hereinafter set forth. WHEREAS, the parties hereto entered into that certain Amended and Restated Advisory Agreement, entered into as of April 2, 2024 (the “Prior Agreement”); WHEREAS, the parties hereto now wish to renew the Prior Agreement. NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants and agreements contained herein, the parties hereto agree: ARTICLE 1 DEFINITIONS The following defined terms used in this Agreement shall have the meanings specified below: “Acquisition Expenses” means any and all expenses, excluding the fees payable to the Advisor pursuant to Section 8.01, incurred by the Company, the Partnership, the Advisor or any of their Affiliates in connection with the selection, acquisition or development of any Property, or other Residential Asset, whether or not acquired, as applicable, including, without limitation, legal fees and expenses, travel and communications expenses, costs of appraisals, due diligence, nonrefundable option payments on assets not acquired, accounting fees and expenses, title insurance premiums and miscellaneous expenses related to the selection, acquisition or development of any Property or other potential investment. “Acquisition Fees” means the fee payable to the Advisor pursuant to Section 8.01 plus all other fees and commissions, excluding Acquisition Expenses, paid by any Person to any Person in connection with investing in Residential Assets. Included in the computation of such fees or commissions shall be any real estate commission, selection fee, nonrecurring management fee, loan fees or points or any fee of a similar nature, however designated. Excluded shall be development fees and construction fees paid to Persons not Affiliated with the Advisor in connection with the actual development and construction of a Property. The Advisor shall not be entitled to more than one Acquisition Fee for each Property. “Affiliate” or “Affiliated” shall mean, with respect to any Person, (i) any Person directly or indirectly owning, controlling or holding, with the power to vote, 10% or more of the outstanding voting securities of such other Person; (ii) any Person 10% or more of whose outstanding voting securities are directly or indirectly owned, controlled or held, with the power to vote, by such other Person; (iii) any

---

2 CLOSED\1607203150.4 Person directly or indirectly controlling, controlled by or under common control with such other Person; (iv) any executive officer, director, trustee or general partner of such other Person; and (v) any legal entity for which such Person acts as an executive officer, director, trustee or general partner. “BPT Unit Issuance Value” means $3,026,497. “BPT Unit Redemption Value” means $6,477,147. “BPT Units” means 510,816 limited partnership units in the Partnership previously issued to BPT Holdings LLC, a Delaware limited liability company, and assigned to the Partnership on June 27, 2022 in consideration of the BPT Unit Redemption Value. “Board of Directors” or “Board” means persons holding such office, as of any particular time, under the Charter, whether they be the Directors named therein or additional or successor Directors. “Bylaws” means the bylaws of the Company, as amended from time to time. “Cause” means (a) if the Company or the Advisor materially breaches any provision of this Agreement and the breach continues for a period of thirty days after written notice thereof by the non- breaching party specifying the breach and requesting that the breach be remedied in the thirty-day period or (b) a Change of Control. “Change of Control” means the occurrence of any of the following: (i) any “person” (within the meaning of Section 13(d) of the Exchange Act, as enacted and in force on the date hereof), other than POSOR or its Affiliates, is or becomes the “beneficial owner” (as that term is defined in Rule 13d-3, as enacted and in force on the date hereof, under the Exchange Act) of securities of the Company representing more than 50% of the combined voting power of the Company’s securities then outstanding; (ii) there occurs a merger, consolidation or other reorganization of the Company which is not approved by the Board of Directors; (iii) there occurs a sale, exchange, transfer or other disposition of substantially all the assets of the Company to another Person, which disposition is not approved by the Board of Directors; or (iv) there occurs a contested proxy solicitation of the Stockholders that results in the contesting party electing candidates to a majority of the Board of Directors’ positions next up for election. “Change of Control Termination Notice” shall have the meaning set forth in Article 12 of this Agreement. “Charter” means the charter of the Company. “Code” means the Internal Revenue Code of 1986, as amended from time to time, or any successor statute thereto. Reference to any provision of the Code shall mean such provision as in effect from time to time, as the same may be amended, and any successor provision thereto, as interpreted by any applicable regulations as in effect from time to time. “Common Shares” means the shares of common stock of the Company, par value $.001 per share. “Company” means Pacific Oak Residential Trust, Inc., a corporation organized under the laws of the State of Maryland. “Competitive Real Estate Commission” means a real estate or brokerage commission for the purchase or Sale of property that is reasonable, customary, and competitive in light of the size, type, and location of the property. 3 CLOSED\1607203150.4 “Contract Sales Price” means the total consideration received by the Partnership for the Sale of a Residential Asset or other Permitted Investment. “Cost of Residential Assets” means the sum of (i) with respect to Residential Assets wholly owned, directly or indirectly, by the Partnership, the amount actually paid by the Partnership for the purchase of each Residential Asset, including fees and expenses related thereto (but excluding any Acquisition Fees paid or payable to the Advisor or its affiliates under this Agreement), plus amounts funded or budgeted at the time of acquisition for capital expenditures for the development, construction or improvement of Residential Assets and (ii) in the case of Residential Assets owned by any Joint Venture in which the Partnership is, directly or indirectly, a co-venturer, the portion of the amount actually paid for the purchase of each Residential Asset, including fees and expenses related thereto (but excluding any Acquisition Fees paid or payable to the Advisor or its affiliates under this Agreement), plus amounts funded or budgeted at the time of acquisition for capital expenditures for the development, construction or improvement of Residential Assets, that is attributable to the Partnership’s investment in the Joint Venture. The Cost of Residential Assets is computed without regard to whether any portion of the cost is funded using debt financing secured by, or attributable to, the Residential Asset. “Dealer Manager” means (i) Pacific Oak Capital Markets, LLC, a Delaware limited liability company, or (ii) any successor dealer manager to the Company. “Director” means a member of the Board of Directors of the Company. “Distributions” shall have the meaning set forth in the Company’s Charter. “GAAP” means accounting principles generally accepted in the United States. “Hall and McMillan Interest” shall have the meaning described in Article 8. “Hall and McMillan Fee Reduction” shall have the meaning described in Article 8. “Initial Capitalization in November 2019” means $55,000,000. “IPO” means an initial public offering of Common Shares in the public markets with a concurrent Listing of Common Shares. “Joint Venture” means any arrangement between the Company or any Affiliate including the Partnership on the one hand and a third party on the other hand pursuant to which the Company and the third party invest in Residential Assets or other Permitted Investments. “Legacy Catch-Up” shall have the meaning described in Article 8. “Legacy Excess Profits” shall have the meaning described in Article 8. “Legacy Hurdle Amount” means that amount that results in a 5% cumulative, non-compounded, annual return on Legacy Invested Capital (calculated like simple interest on a daily basis based on a three hundred sixty-five day year). For purposes of calculating the Legacy Hurdle Amount, Legacy Invested Capital shall be determined for each day during the period for which the Legacy Hurdle Amount is being calculated. “Legacy Incentive Fee” shall have the meaning described in Article 8. 4 CLOSED\1607203150.4 “Legacy Invested Capital” means (a) the Initial Capitalization in November 2019 (which is deemed invested on November 5, 2019), plus the BPT Unit Issuance Value (which is deemed invested on July 1, 2020), plus additional amounts invested by POSOR in Common Shares and/or OP Units since November 5, 2019, reduced by (b) the BPT Unit Redemption Value (which was paid to repurchase the BPT Units on June 27, 2022) plus any amounts paid by the Company to redeem or repurchase Common Shares from POSOR, plus any amounts paid by the Partnership to redeem or repurchase OP Units from POSOR (other than the BPT Units). “Legacy Total Return” shall have the meaning described in Article 8. “Listed” or “Listing” shall mean the listing of any or all of the Common Shares on a national securities exchange. “Market Value” means: in the case of an IPO, (a) the value of the outstanding Common Shares of the Company that are Listed measured by taking the average closing price or the average of the bid and ask prices, as the case may be, over a period of 30 days during which the Common Shares are traded with the period beginning 30 days after the date that the Common Shares are Listed plus (b) with respect to any classes of Common Shares that are not Listed and/or any outstanding OP Units held by third parties other than the Company, the value of such outstanding securities using a methodology that is reasonably based on the valuation determined in (a) above. “Merger or Sale Consideration Amount” means: (a) (i) in the case of a merger or sale for all or substantially all of the Company’s equity interests or Properties in which the consideration consists solely of cash, the total consideration to be received by holders of Common Shares outstanding immediately prior to the closing of such merger or sale; (ii) in the case of a merger or share exchange in which the consideration consists of securities traded on a national securities exchange, the product of (x) the number of shares of such securities received by the Stockholders at the closing of the merger or share exchange and (y) the market value of such securities, measured by taking the average closing price or the average of the bid and asked price, as the case may be, over a period of 20 consecutive days during which such securities are traded, with such 20-trading day period ending on the trading day prior to the closing date of the merger or share exchange; (iii) in the case of a merger or share exchange in which the consideration consist of securities that are not traded on a national securities exchange, the value ascribed to such securities in the merger agreement; and (iv) in the case of a merger, sale or share exchange in which the consideration is some combination of that described above, the sum of clauses (i) through (iii), as applicable plus (b) with respect to any outstanding OP Units held by third parties other than the Company, the value of such outstanding securities using a methodology that is reasonably based on the valuation determined in (a) above. “MGCL” means the Maryland General Corporation Law, as amended from time to time. “NAV” means the most recent net asset value of the Company, Common Shares or OP Units, as applicable, as calculated in accordance with the valuation guidelines approved by the POSOR Board of Directors, adjusted to reflect any subsequent distributions paid on equity capital of the Company or Partnership, distributions made in connection with redemptions of equity capital of the Company or Partnership, or net proceeds from the sale of equity capital of the Company or Partnership. “NAV REIT” means a REIT that is not publicly traded on a stock exchange, regularly calculates and discloses the NAV of its shares, conducts offerings of its stock at prices based on the NAV per share, and repurchases its shares of stock at prices based on the NAV per share. “OP Units” means units of limited partnership interest in the Partnership. 5 CLOSED\1607203150.4 “Organization and Offering Expenses” means all expenses incurred by or on behalf of the Company in connection with any offering of its Common Shares, whether incurred before or after the date of this Agreement, which may include but are not limited to, total underwriting or placement agent fees, brokerage discounts and commissions (including fees of counsel to the underwriter or placement agent); any expense allowance granted by the Company to the underwriter or placement agent or any reimbursement of expenses of the underwriter, placement agent, Sponsor or Advisor by the Company; legal fees; due diligence expenses; marketing expenses; expenses for printing, engraving and mailing; charges of transfer agents, registrars, trustees, escrow holders, depositaries and experts; and expenses of qualification of the sale of the securities under federal and state laws, including taxes and fees and the fees and expenses of accountants and attorneys. “Other Organization and Offering Expenses” means all Organization and Offering Expenses excluding total underwriting or placement agent fees, brokerage discounts and commissions. “Partnership” means PORT OP LP, a Delaware limited partnership formed to own and operate investments in Residential Assets and other Permitted Investments on behalf of the Company. “Permitted Investments” means all investments in which the Company may acquire an interest, either directly or indirectly, including Properties, Single Family Housing Interests and short-term investments acquired for purposes of cash management, and including ownership interests in a Joint Venture. “Person” means an individual, corporation, partnership, estate, trust (including a trust qualified under Section 401(a) or 501(c) (17) of the Code), a portion of a trust permanently set aside for or to be used exclusively for the purposes described in Section 642(c) of the Code, association, private foundation within the meaning of Section 509(a) of the Code, joint stock company or other entity, or any government or any agency or political subdivision thereof, and also includes a group as that term is used for purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended. “POSOR” means Pacific Oak Strategic Opportunity REIT, Inc., a Maryland corporation. “POSOR Board of Directors” means the board of directors of POSOR. “Private Offering” means the private offering of Common Shares made pursuant to the Company’s private offering of up to $500 million of Common Shares in the primary offering, and $50 million of Common Shares through the distribution reinvestment plan, which commenced on September 9, 2022 and terminated on April 2, 2024. “Property” or “Properties” means any real property or properties transferred or conveyed to the Company or the Partnership, either directly or indirectly, or any real property acquired, transferred or conveyed to a Joint Venture in which the Company is, directly or indirectly, a co-venturer. “Property Manager” means an entity that has been retained to perform and carry out property- management services at one or more of the Properties. “Public NAV REIT Conversion” means conversion of the Company to a publicly-offered perpetual life NAV REIT. “REIT” means a “real estate investment trust” under Sections 856 through 860 of the Code. “Residential Assets” means Single Family Rental Properties and Single Family Housing Interests.

---

6 CLOSED\1607203150.4 “Sale” means any transaction or series of related transactions whereby: (A) the Company, directly or indirectly, including through the Partnership sells, grants, transfers, conveys, or relinquishes its ownership of any Property, or other Permitted Investment or portion thereof, including the transfer of any Property that is the subject of a ground lease, and including any event with respect to any Property or other Permitted Investment that gives rise to a significant amount of insurance proceeds or condemnation awards, and including the issuance by one of the Company’s subsidiaries of any asset-backed securities or collateralized debt obligations as part of a securitization transaction; (B) the Company, directly or indirectly, including through the Partnership, sells, grants, transfers, conveys, or relinquishes its ownership of all or substantially all of the interest in any Joint Venture in which it is, directly or indirectly, a co- venturer; or (C) any Joint Venture in which the Company, directly or indirectly, through the Partnership is, a co-venturer, sells, grants, transfers, conveys, or relinquishes its ownership of any Property or other Permitted Investment or portion thereof, including any event with respect to any Property or other Permitted Investment that gives rise to insurance claims or condemnation awards, and including the issuance by the Joint Venture or one of its subsidiaries of any asset-backed securities or collateralized debt obligations as part of a securitization transaction. “SEC” means the United States Securities and Exchange Commission. “Single Family Rental Properties” means a residential building consisting of one to four units for rent. “Single Family Housing Interest” means securities or other interests that generate cash flow derived from single family housing such as mortgages secured by single family homes, subordinated, mezzanine or bridge loans made to owners or investors in single family homes and other related structured investments. “Sponsor” means Pacific Oak Capital Advisors, LLC, a Delaware limited liability company. “Stockholders” means the record holders of the Common Shares or any other series of class of stock of the Company. “Termination Date” means the date of termination of the Agreement determined in accordance with Article 13 hereof. “Total Incentive Fee” shall have the meaning described in Article 8. “Trigger Date” means the effective date of any subordinated incentive fee becoming due pursuant to Article 8. “Triggering Event” means an event which triggers the Company’s obligation to pay a subordinated incentive fee pursuant to Article 8 to the Advisor: (1) an IPO, a sale of all or substantially all of the Company’s equity interests or Properties, a merger, or a share exchange, in a transaction that provides Stockholders with any combination of cash and/or securities of a publicly traded company in exchange for their Common Shares; (2) a Public NAV REIT Conversion; or (3) if this Agreement is terminated (including through non-renewal) (except for cause) by the Company. ARTICLE 2 APPOINTMENT The Company hereby appoints the Advisor to serve as its advisor on the terms and conditions set forth in this Agreement, and the Advisor hereby accepts such appointment. 7 CLOSED\1607203150.4 ARTICLE 3 DUTIES OF THE ADVISOR The Advisor is responsible for managing, operating, directing and supervising the operations and administration of the Company and its assets, subject to the condition that any investment advisory services provided with respect to securities shall be provided by a registered investment adviser. The Advisor undertakes to make investment decisions on behalf of the Company subject to the direction and oversight of the Board and Section 4.03 hereof, and to provide the Company with a continuing and suitable investment program consistent with the investment objectives and policies of the Company as determined and adopted from time to time by the Board. Subject to the limitations set forth in this Agreement, including Article 4 hereof, and the continuing and exclusive authority of the Board over the management of the Company, the Advisor shall, either directly or by engaging an Affiliate or third party, perform the following duties: 3.01 Organizational and Offering Services. The Advisor shall perform all services related to the organization of the Company or any offering of Company securities, other than services that (i) are to be performed by the Dealer Manager, (ii) the Company elects to perform directly or (iii) would require the Advisor to register as a broker-dealer with the SEC or any state. 3.02 Acquisition Services. (i) Provide the Company with relevant market research and economic and statistical data in connection with the Company’s assets and investment objectives and policies; (ii) Subject to Section 4 hereof and the investment objectives and policies of the Company: (a) locate, analyze and select potential investments; (b) structure and negotiate the terms and conditions of transactions pursuant to which investments in Residential Assets and other Permitted Investments will be made; (c) cause the Company to, directly or indirectly, acquire Residential Assets and other Permitted Investments; (d) arrange for financing and refinancing and make other changes in the asset or capital structure of investments in Residential Assets and other Permitted Investments; and (e) enter into leases, service contracts and other agreements for Residential Assets and other Permitted Investments, or to engage an approved Property Manager; (iii) Perform due diligence on prospective investments; (iv) Prepare reports regarding prospective investments that include recommendations and supporting documentation necessary for the Directors to evaluate the proposed investments; (v) Obtain reports (which may be prepared by the Advisor or its Affiliates), where appropriate, concerning the value of contemplated investments of the Company; and (vi) Deliver to or maintain on behalf of the Company copies of all appraisals or valuations obtained in connection with the Company’s investments. 3.03 Asset Management Services. (i) Real Estate and Related Services: (a) Investigate, select and, on behalf of the Company, engage and conduct business with (including enter contracts with) such Persons as the Advisor deems necessary to the proper performance of its obligations as set forth in this Agreement, including but 8 CLOSED\1607203150.4 not limited to consultants, accountants, lenders, technical advisors, attorneys, brokers, underwriters, corporate fiduciaries, escrow agents, depositaries, custodians, agents for collection, insurers, insurance agents, developers, construction companies, Property Managers and any and all Persons acting in any other capacity deemed by the Advisor necessary or desirable for the performance of any of the foregoing services; (b) Negotiate any borrowings that the Company, directly or indirectly, makes and to cause the Company or the underlying borrower to pay any amounts due on the borrowings; (c) Monitor applicable markets and obtain reports (which may be prepared by the Advisor or its Affiliates) where appropriate, concerning the value of investments of the Company; (d) Monitor and evaluate the performance of each asset of the Company and the Company’s overall portfolio of assets, provide daily management services to the Company and perform and supervise the various management and operational functions related to the Company’s investments; (e) Formulate and oversee the implementation of strategies for the administration, promotion, management, operation, maintenance, improvement, financing and refinancing, marketing, leasing and disposition of Residential Assets and other Permitted Investments on an overall portfolio basis; (f) Consult with the Company’s officers and the Board and assist the Board in formulating and implementing the Company’s financial policies, and, as necessary with respect to investment and borrowing opportunities presented to the Board, furnish the Board with advice and recommendations with respect to the making of investments consistent with the investment objectives and policies of the Company and in connection with any borrowings proposed to be undertaken by the Company; (g) Oversee and evaluate the performance by the Property Manager(s) of their duties, including collection and proper deposits of rental payments and payment of Property expenses and maintenance; (h) Conduct periodic on-site property visits to some or all (as the Advisor deems reasonably necessary) of the Properties to inspect the physical condition of the Properties; (i) Review, analyze and comment upon the operating budgets, capital budgets and leasing plans prepared and submitted by each Property Manager and aggregate these property budgets into the Company’s overall budget; (j) Coordinate and manage relationships between the Company and any co- venturers; and (k) Consult with the Company’s officers and the Board and provide assistance with the evaluation and approval of potential asset disposition, Sale and refinancing opportunities. (ii) Accounting and Other Administrative Services: 9 CLOSED\1607203150.4 (a) Provide the day-to-day management of the Company and perform and supervise the various administrative functions reasonably necessary for the management of the Company; (b) From time to time, or at any time reasonably requested by the Board, make reports to the Board on the Advisor’s performance of services to the Company under this Agreement; (c) Provide or arrange for any administrative services and items, legal and other services, office space, office furnishings, personnel and other overhead items necessary and incidental to the Company’s business and operations; (d) Provide financial and operational planning services; (e) Maintain accounting and other record-keeping functions at the Company and investment levels, including information concerning the activities of the Company as shall be required to prepare and to file all periodic financial reports, tax returns and any other information required to be filed with the Internal Revenue Service and any other regulatory agency; (f) Maintain and preserve all appropriate books and records of the Company; (g) Provide services necessary to ensure the Company’s compliance with the rules and regulations governing qualification as a REIT, including any asset, income and shareholder testing, and addressing with the Board, if necessary, any actions required to maintain REIT compliance; (h) Provide tax and compliance services and coordinate with appropriate third parties, including the Company’s independent auditors and other consultants, on related tax matters; (i) Provide the Company with all necessary cash management services; (j) Manage and coordinate with the transfer agent payment of dividends and other distributions to Stockholders; (k) Consult with the Company’s officers and the Board and assist the Board in evaluating and obtaining necessary insurance coverage based upon risk management determinations; (l) Provide the Company’s officers and the Board with timely updates related to the overall regulatory environment affecting the Company, as well as managing compliance with such matters; (m) Consult with the Company’s officers and the Board relating to the corporate governance structure and appropriate policies and procedures related thereto; (n) Perform all reporting, record keeping, internal controls and similar matters in a manner to allow the Company to comply with applicable law;

---

10 CLOSED\1607203150.4 (o) Notify the Board of all proposed material transactions before they are completed; and (p) Do all things necessary to assure its ability to render the services described in this Agreement. ARTICLE 4 AUTHORITY OF THE ADVISOR 4.01 General. All rights and powers to manage and control the day-to-day business and affairs of the Company shall be vested in the Advisor. The Advisor shall have the power to delegate all or any part of its rights and powers to manage and control the business and affairs of the Company to such officers, employees, Affiliates, agents and representatives of the Advisor or the Company as it may deem appropriate. Any authority delegated by the Advisor to any other Person shall be subject to the limitations on the rights and powers of the Advisor specifically set forth in this Agreement or the Charter. Notwithstanding the foregoing, any investment advisory services provided with respect to securities shall be provided by a registered investment adviser. 4.02 Powers of the Advisor. Subject to the express limitations set forth in this Agreement and the continuing and exclusive authority of the Board over the management of the Company, the power to direct the management, operation and policies of the Company, including making, financing and disposing of investments, shall be vested in the Advisor, which shall have the power by itself and shall be authorized and empowered on behalf and in the name of the Company to carry out any and all of the objectives and purposes of the Company and to perform all acts and enter into and perform all contracts and other undertakings that it may in its sole discretion deem necessary, advisable or incidental thereto to perform its obligations under this Agreement. 4.03 Approval by the Board. Notwithstanding the foregoing, the Advisor may not take any action on behalf of the Company without the prior approval of the Board or duly authorized committees thereof if the Charter or the MGCL require the prior approval of the Board. If the Board or a committee of the Board must approve a proposed investment, financing or disposition or chooses to do so, the Advisor will deliver to the Board or committee, as applicable, all documents required by it to evaluate such investment, financing or disposition. 4.04 Modification or Revocation of Authority of Advisor. The Board may, at any time upon the giving of notice to the Advisor, modify or revoke the authority or approvals set forth in Article 3 and this Article 4 hereof; provided, however, that such modification or revocation shall be effective upon receipt by the Advisor and shall not be applicable to investment transactions to which the Advisor has committed the Company prior to the date of receipt by the Advisor of such notification. ARTICLE 5 BANK ACCOUNTS The Advisor may establish and maintain one or more bank accounts in its own name for the account of the Company or in the name of the Company and may collect and deposit into any such account or accounts, and disburse from any such account or accounts, any money on behalf of the Company, under such terms and conditions as the Board may approve, provided that no funds shall be commingled with the funds of the Advisor. The Advisor shall from time to time render appropriate accountings of such collections and payments to the Board and the independent auditors of the Company. 11 CLOSED\1607203150.4 ARTICLE 6 RECORDS AND FINANCIAL STATEMENTS The Advisor, in the conduct of its responsibilities to the Company, shall maintain adequate and separate books and records for the Company’s operations, which shall be supported by sufficient documentation to ascertain that such books and records are properly and accurately recorded. Such books and records shall be the property of the Company and shall be available for inspection by the Board and by counsel, auditors and other authorized agents of the Company or persons with rights to inspect the books and records, at any time or from time to time during normal business hours. Such books and records shall include all information necessary to calculate and audit the fees paid or reimbursements made under this Agreement. The Advisor shall utilize procedures to attempt to ensure such control over accounting and financial transactions as is reasonably required to protect the Company’s assets from theft, error or fraudulent activity. All financial statements that the Advisor delivers to the Company for distribution to Stockholders shall be prepared on an accrual basis in accordance with GAAP, except for special financial reports that by their nature require a deviation from GAAP. The Advisor shall liaise with the Company’s officers and independent auditors and shall provide such officers and auditors with the reports and other information that the Company so requests. ARTICLE 7 LIMITATION ON ACTIVITIES Notwithstanding any provision in this Agreement to the contrary, the Advisor shall not take any action that, in its sole judgment made in good faith, would (i) adversely affect the ability of the Company to qualify or continue to qualify as a REIT under the Code, (ii) subject the Company to regulation under the Investment Company Act of 1940, as amended, (iii) violate any law, rule, regulation or statement of policy of any governmental body or agency having jurisdiction over the Company, its Common Shares or its other securities, (iv) require the Advisor to register as a broker-dealer with the SEC or any state, (v) violate the Charter or Bylaws, or (vi) cause the Company’s parent, Pacific Oak Strategic Opportunity REIT, Inc., to violate its charter (the “SOR Charter”). ARTICLE 8 FEES 8.01 Acquisition Fees. As compensation for the investigation, selection, sourcing and acquisition or origination (by purchase, investment or exchange) of Residential Assets and other Permitted Investments, the Company shall pay the Advisor an Acquisition Fee for each such investment equal to 1.0% of the Cost of Residential Assets for any given transaction. With respect to the acquisition of any Residential Asset or other Permitted Investment through any Joint Venture in which the Partnership is, directly or indirectly, a partner, member or stockholder the Acquisition Fee payable to the Advisor shall equal 1.0% of each investment in the Joint Venture. The Advisor shall submit an invoice to the Company following the closing or closings of each investment. Generally, the Acquisition Fee payable to the Advisor shall be paid at the closing of the transaction upon receipt of the invoice by the Company. The Advisor may, in its discretion, waive or defer any Acquisition Fee, in whole or in part, in its sole discretion. All or any portion of the Acquisition Fees deferred shall not bear interest and may be paid by the Company in the Joint Venture in such other fiscal year as the Advisor shall determine. 8.02 Asset Management Fees. As compensation for the services described in Section 3.03 the Company shall pay the Advisor an asset management fee equal to 0.25% quarterly (1% annually) on the most recent aggregate value of the Partnership’s Residential Assets and other Permitted Investments, as determined in accordance with the valuation guidelines approved by the POSOR Board of Directors (adjusted to reflect any subsequent purchases or sales of portfolio assets based on the purchase or sale 12 CLOSED\1607203150.4 prices). The Advisor shall submit an invoice to the Company, accompanied by a computation of the fees for the applicable period. Generally, the Asset Management Fee payable to the Advisor shall be paid on the last day of such quarter, or the first business day following the last day of such quarter. In the event this Agreement commences on a date other than the first day of a quarter, the Advisor will be entitled to receive its prorated asset management fee calculated from the date of commencement. In the event this Agreement is terminated or its term expires without renewal, the Adviser will be entitled to receive its prorated asset management fee through the date of termination. Such pro ration shall take into account the number of days of any partial quarter for which this Agreement was in effect. 8.03 Disposition Fees. If the Advisor or any of its Affiliates provide a substantial amount of services in connection with a Sale, the Advisor or such Affiliate shall receive a fee at the closing (the “Disposition Fee”) equal to 1% of the Contract Sales Price; provided, however, that if in connection with such Sale commissions are paid to third parties other than the Advisor or its Affiliates, the fee paid to the Advisor or any of its Affiliates may not exceed the commissions paid to such unaffiliated third parties. Any Disposition Fee payable under this Section 8.03 may be paid in addition to commissions paid to non- Affiliates, provided that the total commissions (including such Disposition Fee) paid to all Persons by the Company for each Sale shall not exceed an amount equal to the lesser of (i) 6% of the aggregate Contract Sales Price of each Residential Asset or other Permitted Investment or (ii) the Competitive Real Estate Commission for each Residential Asset or other Permitted Investment. 8.04 Incentive Fees. Upon a Triggering Event, the Company shall pay to the Advisor a Total Incentive Fee, as calculated following the methodology below. If the Company pays the Advisor the Total Incentive Fee associated with one Triggering Event, the Company will not pay the Advisor any further incentive fees. For each Triggering Event, the Total Incentive Fee is equal to the applicable Legacy Incentive Fee described in Section 8.05, subject to the Hall and McMillan Fee Reduction described in Section 8.06. Any Total Incentive Fee due on Public NAV REIT Conversion will be payable to the Advisor in Common Shares and such shares will be subordinate to repurchase requests from other Stockholders under the Company’s share repurchase plan (although no deduction for early repurchase will apply to the Advisor’s Common Shares). 8.05 Legacy Incentive Fees. (i) Legacy Incentive Fee Due on IPO, Sale, or Merger. In the event of an IPO, a sale of all or substantially all of the Company’s equity interests or Properties, a merger, or a share exchange, in a transaction that provides Stockholders with any combination of cash and/or securities of a publicly traded company in exchange for their Common Shares, then a Legacy Incentive Fee shall be due to the Advisor using the formula below under Section 8.05(ii), but the Market Value or the Merger or Sale Consideration Amount, as applicable, of the OP Units and/or Common Shares held by POSOR will be used instead of the then-current NAV of the OP Units and/or Common Shares held by POSOR when calculating Legacy Total Return. (ii) Legacy Incentive Fee Due on Public NAV REIT Conversion. If the Company completes a Public NAV REIT Conversion, and has satisfied all properly submitted requests under the Company’s share repurchase program for the 12 months prior to the Trigger Date, the Advisor will be entitled to a Legacy Incentive Fee equal to 12.5% of the Legacy Total Return, subject to a 5% Legacy Hurdle Amount with a Legacy Catch-Up. Specifically, the Legacy Incentive Fee will equal: (a) First, if the Legacy Total Return exceeds the Legacy Hurdle Amount (any such excess, the “Legacy Excess Profits”), 100% of such Legacy Excess Profits until the total amount allocated to the Advisor hereunder equals 12.5% of the sum of (x) the Legacy 13 CLOSED\1607203150.4 Hurdle Amount and (y) any amount due to the Advisor pursuant to this clause (this is referred to as a “Legacy Catch-Up”); and (b) Second, to the extent there are remaining Legacy Excess Profits, 12.5% of such remaining Legacy Excess Profits. (c) “Legacy Total Return” shall equal the sum of (i) all distributions accrued or paid (without duplication) on OP Units and Common Shares held by POSOR between November 5, 2019 and the Trigger Date, plus (ii) all distributions accrued or paid (without duplication) on OP Units held by BPT Holdings LLC between November 5, 2019 and the September 9, 2022, plus (iii) the amount by which (a) the sum of the then-current NAV of the outstanding OP Units and/or Common Shares held by POSOR, plus any amounts POSOR received from the Company or the Partnership upon repurchase or redemption of Common Shares or OP Units, plus the BPT Unit Redemption Value exceeds (b) the sum of the Initial Capitalization in November 2019 and all subsequent amounts POSOR invested in the Company and/or the Partnership in exchange for Common Shares and/or OP Units, plus the BPT Unit Issuance Value, plus (iv) the accrued Legacy Incentive Fee, if any (after taking into account the fee reduction in Section 8.06). (iii) Legacy Incentive Fee Due on Termination. The Legacy Incentive Fee calculated pursuant to 8.05(ii) above will also be due if this Agreement is terminated (including through non- renewal) (except for cause) by the Company. If a fee is due, the Company will only pay the amounts due from the proceeds from the Sale of one or more assets or with the excess proceeds from financing or refinancing the Company’s assets. Amounts not paid will not bear interest and will only be paid from the excess proceeds from future asset Sales, financings or refinancing. 8.06 Hall and McMillan Fee Reduction. Messrs. Peter McMillan and Keith Hall have an economic interest in the cash flows of BPT Holdings, LLC, which in turn owns 100% of Pacific Oak Residential, Inc. (“PORI”), which in turn owns 100% of the Advisor (the “Hall and McMillan Interest”). As of September 1, 2022, the Hall and McMillan Interest is 52%. If a Legacy Incentive Fee becomes due pursuant to Article 8, and the Hall and McMillan Interest is at least 52% at that time, the Company will pay to the Advisor the Legacy Incentive Fee, reduced by that portion of the Legacy Incentive Fee which is equivalent to the Hall and McMillan Interest. If a Legacy Incentive Fee becomes due pursuant to Article 8 and the Hall and McMillan Interest is less than 52% at that time, the Company shall pay the Advisor 48% of the Legacy Incentive Fee. In addition, Messrs. McMillan and Hall undertake and agree not to share, directly or indirectly, in the portion of the Legacy Incentive Fee paid by the Company to the Advisor, but rather that it shall be distributed in its entirety to the other members of BPT Holdings, LLC. Messrs. McMillan and Hall agree and PORA agrees, on behalf of itself and its direct and indirect owners, to work in good faith with the other members of BPT Holdings, LLC to ensure that Messrs. McMillan and Hall are not responsible for paying income tax on such amount, as it will be distributed to other members of BPT Holdings, LLC and not to Messrs. McMillan and Hall. 8.07 Election of Payment in Shares. Subject to Section 8.04, the Advisor may elect, in its sole discretion, to receive payment of any fees described herein in cash or cash equivalent aggregate NAV amounts of Class A Common Shares, with the value per Class A Common Share equal to the most recent NAV per Class A Common Share determined in accordance with the valuation guidelines approved by the POSOR Board of Directors. Such Common Shares issued to the Advisor are eligible to participate in the Company’s share repurchase program, subject to the applicable limits, holding period and early repurchase deduction therein, provided that in the applicable repurchase period all repurchase requests made in good order from unaffiliated stockholders are satisfied first as a priority.

---

14 CLOSED\1607203150.4 ARTICLE 9 EXPENSES 9.01 General. In addition to the compensation paid to the Advisor pursuant to Article 8 hereof, but subject to Section 9.03 below, the Company shall pay directly or reimburse the Advisor for Other Organization and Offering Expenses incurred by the Advisor or its Affiliates in connection with the Private Offering and for all of the third-party expenses paid or incurred by the Advisor or its Affiliates on behalf of the Company or in connection with the services provided to the Company pursuant to this Agreement; provided, however, neither the Advisor nor any of its Affiliates shall be entitled to any reimbursement for any cost or expenses for salaries, bonuses and benefits of persons employed by the Advisor or its Affiliates who perform services for the Company or in any way related to the overhead or operations of the Advisor or its Affiliates; provided further that any expenses incurred by the Dealer Manager or relating to its activities must be pre-approved by the Company in order to be eligible for reimbursement pursuant to this section. The third-party expenses for which payment or reimburse will be allowed include, but are not limited to: (i) Acquisition Expenses incurred in connection with the selection and acquisition of Residential Assets and other Permitted Investments, including expenses incurred related to assets pursued or considered but not ultimately acquired by the Company; (ii) The cost of goods and services used by the Company and obtained from third parties other than the Advisor or its Affiliates; (iii) Interest and other costs for borrowed money, including discounts, points and other similar fees; (iv) Taxes and assessments on income or Properties, taxes as an expense of doing business and any other taxes otherwise imposed on the Company and its business, assets or income; (v) All expenses, except expenses incurred by any Property Manager affiliated with the Advisor, of managing, improving, developing, operating and selling Residential Assets and other Permitted Investments owned, directly or indirectly, by the Company, as well as expenses of other transactions relating to the Residential Assets and other Permitted Investments; (vi) All expenses in connection with payments to the Board and meetings of the Board and Stockholders; (vii) Expenses of providing services for and maintaining communications with Stockholders, including the cost of preparing, printing, and mailing annual reports and other Stockholder reports, proxy statements and other reports required by governmental entities; (viii) Out-of-pocket costs associated with insurance required in connection with the business of the Company or by its officers and directors; (ix) Audit, accounting and legal fees, and other fees for professional services relating to the operations of the Company and all such fees incurred at the request, or on behalf of, the Board or any committee of the Board; (x) Expenses for the Company to comply with all applicable laws, regulations and ordinances; 15 CLOSED\1607203150.4 (xi) Expenses connected with payments of Distributions and stock dividends made or caused to be made by the Company to the Stockholders; (xii) Expenses of merging, liquidating or dissolving the Company or of amending the Charter or the Bylaws; and (xiii) All other third-party out-of-pocket costs incurred by the Advisor in performing its duties hereunder. 9.02 Timing of and Additional Limitations on Reimbursements. (i) Expenses incurred by the Advisor on behalf of the Company and reimbursable to the Advisor pursuant to this Article 9 shall be reimbursed upon delivery by the Advisor to the Board of a statement documenting the reimbursable expenses for the prior quarter; provided that the statement shall be delivered within 45 days after the end of each quarter. 9.03 Advancement of Other Organization and Offering Expenses. (i) The Sponsor will advance the Company’s Other Organization and Offering Expenses through the first anniversary of the date of the commencement of the Private Offering. (ii) The Company will reimburse the Sponsor for such advanced expenses ratably over the 60 months following the first anniversary of the date of the commencement of the Private Offering. ARTICLE 10 RELATIONSHIP OF THE ADVISOR AND THE COMPANY; OTHER ACTIVITIES OF THE ADVISOR 10.01 Relationship. The Company and the Advisor are not partners or joint venturers with each other, and nothing in this Agreement shall be construed to make them partners or joint venturers. This Agreement shall not limit or restrict the right of any manager, director, officer, employee or equity holder of the Advisor or its Affiliates to engage in any other business or to render services of any kind to any other Person. The Advisor may, with respect to any investment in which the Company is a participant, also render advice and service to each and every other participant therein. The Advisor shall promptly disclose to the Board the existence of any additional condition or circumstance, existing or anticipated, of which it has knowledge that creates or could create a conflict of interest between the Advisor’s obligations to the Company and its obligations to or its interest in any other Person. 10.02 Time Commitment. The Advisor shall, and shall cause its Affiliates and their respective employees, officers and agents to, devote to the Company such time as shall be reasonably necessary to conduct the business and affairs of the Company in an appropriate manner consistent with the terms of this Agreement. The Company acknowledges that the Advisor and its Affiliates and their respective employees, officers and agents may also engage in activities unrelated to the Company and may provide services to Persons other than the Company or any of its Affiliates. ARTICLE 11 THE PACIFIC OAK NAME The Advisor and its Affiliates have a proprietary interest in the name “Pacific Oak.” The Advisor hereby grants to the Company a non-transferable, non-assignable, non-exclusive royalty-free right and 16 CLOSED\1607203150.4 license to use the name “Pacific Oak” during the term of this Agreement. Accordingly, and in recognition of this right, if at any time the Company ceases to retain the Advisor or one of its Affiliates to perform advisory services for the Company, the Company will, promptly after receipt of written request from the Advisor, cease to conduct business under or use the name “Pacific Oak” or any derivative thereof and the Company shall change its name and the names of any of its subsidiaries to a name that does not contain the name “Pacific Oak” or any other word or words that might, in the reasonable discretion of the Advisor, be susceptible of indication of some form of relationship between the Company and the Advisor or any of its Affiliates. At such time, the Company will also make any changes to any trademarks, service marks or other marks necessary to remove any references to the word “Pacific Oak.” Consistent with the foregoing, it is specifically recognized that the Advisor or one or more of its Affiliates has in the past and may in the future organize, sponsor or otherwise permit to exist other investment vehicles (including vehicles for investment in real estate) and financial and service organizations having “Pacific Oak” as a part of their name, all without the need for any consent (and without the right to object thereto) by the Company. ARTICLE 12 CHANGE OF CONTROL 12.01 Change of Control. Notwithstanding any other provisions of this Agreement to the contrary, in the event of a Change of Control of the Company, either the Company or the Advisor shall have the right, subject to the Company’s and the Partnership’s right to assign this Agreement in accordance with Section 14, upon sixty (60) days prior written notice to the other (the “Change of Control Termination Notice”), to terminate this Agreement. If the Advisor or the Company so elects to terminate this Agreement pursuant to this Section 12, the Termination Date shall be the date specified in the Change of Control Termination Notice, but in any event no later than thirty (30) days after the Change of Control of the Company. ARTICLE 13 TERM AND TERMINATION OF THE AGREEMENT 13.01 Term. The term of this Agreement is through September 1, 2025 and may be renewed for an unlimited number of successive one-year terms upon mutual consent of the parties. The Company will evaluate the performance of the Advisor before renewing this Agreement, and each such renewal shall be for a term of no more than one year. Any such renewal must be approved by the Board of Directors. 13.02 Termination by Either Party. This Agreement may be terminated for Cause upon 60 days written notice by either the Company or the Advisor. The provisions of Articles 1, 11, 13, 15 and 16 shall survive termination of this Agreement. 13.03 Payments on Termination and Survival of Certain Rights and Obligations. (i) After the Termination Date, the Advisor shall not be entitled to compensation for further services hereunder except it shall be entitled to receive from the Company within 30 days after the effective date of such termination (a) all unpaid reimbursements of expenses and all earned but unpaid fees payable to the Advisor prior to termination of this Agreement and (b) any incentive fees due under Article 8 hereunder. Notwithstanding the foregoing, no incentive fee will be paid if this Agreement is terminated for Cause by the Company in accordance with Section 13.02 following an event described in clause (a) of the definition of Cause. (ii) The Advisor shall promptly upon termination: 17 CLOSED\1607203150.4 (a) pay over to the Company all monies, if any, after deducting any accrued fees and reimbursement for its expenses to which it is then entitled; (b) deliver to the Board a full accounting, including a statement showing all payments collected by it and a statement of all money held by it, covering the period following the date of the last accounting furnished to the Board; (c) deliver to the Board all documents including, but not limited to those related to the Company’s assets then in the custody of the Advisor; and (d) cooperate with the Company to provide an orderly transition of advisory functions. ARTICLE 14 ASSIGNMENT This Agreement may be assigned by the Advisor to an Affiliate with the consent of the Board. This Agreement shall not be assigned by the Company without the consent of the Advisor, except in the case of an assignment by the Company to a corporation or other organization that is a successor to all of the assets, rights and obligations of the Company, in which case such successor organization shall be bound hereunder and by the terms of the assignment in the same manner as the Company is bound by this Agreement. ARTICLE 15 INDEMNIFICATION AND LIMITATION OF LIABILITY 15.01 Indemnification. The Company shall, to the fullest extent to which the Company many indemnify its directors under the MGCL, indemnify, defend and hold harmless the Advisor and its Affiliates, including their respective officers, directors, partners, agents and employees, from all liability, claims, damages or losses arising in the performance of their duties hereunder, and related expenses, including reasonable attorneys’ fees, incurred by these persons or entities to the extent such liability, claims, damages or losses and related expenses are not fully reimbursed by insurance. 15.02 Limitation on Payment of Expenses. The Company shall pay or reimburse the reasonable legal expenses and other costs incurred by the Advisor or its Affiliates in advance of the final disposition of a proceeding subject to the limitations and requirements set forth in the MGCL. ARTICLE 16 MISCELLANEOUS 16.01 Notices. Any notice, report or other communication required or permitted to be given hereunder shall be in writing unless some other method of giving such notice, report or other communication is required by the Charter, the Bylaws or is accepted by the party to whom it is given, and shall be given by being delivered by hand or by overnight mail or other overnight delivery service to the addresses set forth herein: To the Company or the Board: Pacific Oak Residential Trust, Inc. 13901 Sutton Park Dr S. Suite B 160 Jacksonville, FL 32224

---

18 CLOSED\1607203150.4 Email: mgough@pac-oak.com Attention: Michael Gough To the Advisor: Pacific Oak Residential Advisors, LLC 13901 Sutton Park Dr S. Suite B 160 Jacksonville, FL 32224 Email: JAnstis@pac-oak.com Attention: Jeff Anstis Either party may at any time give notice in writing to the other party of a change in its address for the purposes of this Section 16.01. 16.02 Modification. This Agreement shall not be changed, modified, terminated or discharged, in whole or in part, except by an instrument in writing signed by both parties hereto, or their respective successors or permitted assigns. 16.03 Severability. The provisions of this Agreement are independent of and severable from each other, and no provision shall be affected or rendered invalid or unenforceable by virtue of the fact that for any reason any other or others of them may be invalid or unenforceable in whole or in part. 16.04 Construction. The provisions of this Agreement shall be construed and interpreted in accordance with the laws of the State of Delaware. 16.05 Entire Agreement. This Agreement contains the entire agreement and understanding between the parties hereto with respect to the subject matter hereof, and supersedes all prior and contemporaneous agreements, understandings, inducements and conditions, express or implied, oral or written, of any nature whatsoever with respect to the subject matter hereof. The express terms hereof control and supersede any course of performance and/or usage of the trade inconsistent with any of the terms hereof. This Agreement may not be modified or amended other than by an agreement in writing. 16.06 Waiver. Neither the failure nor any delay on the part of a party to exercise any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege preclude any other or further exercise of the same or of any other right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence. No waiver shall be effective unless it is in writing and is signed by the party asserted to have granted such waiver. 16.07 Gender. Words used herein regardless of the number and gender specifically used, shall be deemed and construed to include any other number, singular or plural, and any other gender, masculine, feminine or neuter, as the context requires. 16.08 Titles Not to Affect Interpretation. The titles of Articles and Sections contained in this Agreement are for convenience only, and they neither form a part of this Agreement nor are they to be used in the construction or interpretation hereof. 16.09 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original as against any party whose signature appears thereon, and all of which shall together constitute one and the same instrument. This Agreement shall become binding when 19 CLOSED\1607203150.4 one or more counterparts hereof, individually or taken together, shall bear the signatures of all of the parties reflected hereon as the signatories. [Signature Page to Advisory Agreement] CLOSED\1607203150.4 IN WITNESS WHEREOF, the parties hereto have executed this Agreement effective as of the date and year first above written. PACIFIC OAK RESIDENTIAL TRUST, INC. By: /s/ Michael S. Gough Name: Michael S. Gough Title: Director, Chief Executive Officer and President PORT OP LP By: Pacific Oak Residential Trust, Inc., its general partner By: /s/ Michael S. Gough Name: Michael S. Gough Title: Director, Chief Executive Officer and President PACIFIC OAK RESIDENTIAL ADVISORS, LLC By: Pacific Oak Residential, Inc., sole Member By: /s/ Michael S. Gough Michael S. Gough, President PACIFIC OAK CAPITAL ADVISORS, LLC By: Pacific Oak Holding Group, LLC, sole Member By: /s/ Peter McMillan III Peter McMillan III, Member By: /s/ Keith D. Hall Keith D. Hall, Member By: /s/ Keith D. Hall Name: Keith D. Hall By: /s/ Peter McMillan III Name: Peter McMillan III

---

tulespringsvillage2kb-th

Exhibit 10.2 1614657544.2 THIRD AMENDMENT TO PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (454.31 Acres +/- in Village 2 of Tule Springs) THIS THIRD AMENDMENT TO PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (this “Amendment”) is made and entered into as of August 16, 2024 (the “Amendment Effective Date”), by and among PACIFIC OAK SOR TULE SPRINGS OWNER TRS, LLC, a Delaware limited liability company (“Parcel 2.09A Seller”), and PACIFIC OAK SOR TULE SPRINGS VILLAGE 2 PARCELS OWNER, LLC, a Delaware limited liability company (“Remainder Seller”, and together with Parcel 2.09A Seller, individually or collectively as context requires, “Seller”), and KB HOME LAS VEGAS INC., a Nevada corporation (“KB Home” or “Buyer”), with respect to the transactions contemplated by this Amendment. RECITALS A. Seller, KB Home, and Tri Pointe Homes Nevada, Inc., a Nevada corporation (“Tri Pointe”) entered into that certain Purchase and Sale Agreement and Joint Escrow Instructions dated as of March 10, 2024 (the “Original Purchase Agreement”), as amended by that certain First Amendment to Purchase and Sale Agreement and Joint Escrow Instructions dated as of June 17, 2024 (the “First Amendment”), and as amended by that certain Second Amendment to Purchase and Sale Agreement and Joint Escrow Instructions dated as of June 21, 2024 (the “Second Amendment,” and together with the Original Purchase Agreement and First Amendment, collectively, the “Purchase Agreement”). All capitalized terms used herein and not otherwise defined shall have the meanings ascribed to such terms in the Purchase Agreement. B. Seller and Buyer desire to further modify the terms of the Purchase Agreement as more particularly set forth in this Amendment. AGREEMENTS NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intended to be legally bound, Seller and Buyer hereby agree as follows: 1. Recitals. The Recitals set forth above are hereby incorporated herein by reference as if the same were fully set forth herein. 2. Extension of Phase 1 Closing Date. Notwithstanding anything to the contrary in the Purchase Agreement, the Phase 1 Closing Date shall be, and hereby is, extended to November 1, 2024. The Phase 2 Closing Date shall be July 31, 2025, notwithstanding the extension of the Phase 1 Closing Date. 3. Extension of Due Diligence Period. Notwithstanding anything to the contrary in the Purchase Agreement, Buyer and Seller agree that the Due Diligence Period shall be, and hereby is, extended to September 17, 2024 (and the Due Diligence Termination Date shall be, and hereby is, accordingly extended to September 17, 2024). SMRH:4863-7824-5309.11 -2- 081524 39ZR-379857 1614657544.2 4. Additional Extension Deposit. In consideration of Seller’s extending the Phase 1 Closing Date and the Due Diligence Period, as provided in this Amendment, Buyer shall deposit in Escrow in cash or current funds, an additional extension deposit (the “Additional Extension Deposit”) in the amount of One Hundred Thousand and No/100 Dollars ($100,000.00) no later than three (3) business days from the Amendment Effective Date. Upon Buyer's delivery of the Additional Extension Deposit to Escrow Agent, each and every reference to the Deposit in the Purchase Agreement (as amended by this Amendment) shall mean and include the Initial Deposit, the Additional Deposit, and the Additional Extension Deposit (or such portion thereof that has theretofore been deposited into Escrow). Within three (3) business days from Escrow Agent’s receipt of the Additional Extension Deposit, Escrow Agent shall release the sum of Two Hundred Thousand and No/100 Dollars ($200,000.00) to Seller pursuant to wire instructions to be provided by Seller to Escrow (the “Released Portion of the Deposit”); such release to occur without further direction or approval from Buyer or Seller. The Released Portion of the Deposit consists of the Additional Extension Deposit being made pursuant to this Amendment and the $100,000 portion of the Initial Deposit that was made non-refundable pursuant to the Second Amendment. The Released Portion of the Deposit shall be non-refundable to Buyer, except in the event the Purchase Agreement is terminated due to a default by Seller, at which time the full amount (i.e., $200,000) of the Released Portion of the Deposit shall be returned to Buyer from Seller and Seller’s obligation to return the Released Portion of the Deposit shall survive the termination of this Agreement. Notwithstanding anything to the contrary contained in this Amendment or the Purchase Agreement, the Deposit shall be fully applicable to the Phase 2 Purchase Price at the Phase 2 Closing, except for the Additional Extension Deposit in the amount of $100,000.00 which shall not be applicable to the Purchase Price to be paid at either Closing. 5. Miscellaneous. Except as specifically amended hereby, the Purchase Agreement shall remain and continue in full force and effect. In the event of any conflict between the terms of the Purchase Agreement and the terms of this Amendment, the terms of this Amendment shall control. This Amendment may be executed in as many counterparts as may be deemed necessary and convenient, and by the different parties hereto on separate counterparts, each of which, when so executed, shall be deemed an original, but all such counterparts shall constitute one and the same instrument. To facilitate execution of this Amendment, the parties may execute and exchange by telephone facsimile or by electronic mail in a “PDF” format counterparts of the signature pages. This Amendment may be signed by either Party by electronic signature using Authentisign, DocuSign or similar technology provided that the Party using such technology must submit an original, handwritten signature to the other Party promptly upon request. (Remainder of page intentionally left blank; signature pages follow.) (Signature Page to Third Amendment to Purchase and Sale Agreement and Joint Escrow Instructions - Village 2) 1614657544.2 IN WITNESS WHEREOF, the undersigned parties have executed this Amendment to be effective as of the Amendment Effective Date. SELLER: PACIFIC OAK SOR TULE SPRINGS OWNER TRS, LLC, PACIFIC OAK SOR TULE SPRINGS VILLAGE 2 PARCELS OWNER, LLC, each, a Delaware limited liability company By: /s/ Brian Ragsdale Name: Brian Ragsdale Title: President (Signatures continue on following page.) 1614657544.2 BUYER: KB HOME LAS VEGAS INC., a Nevada corporation By: /s/ Aaron Hirschi Name: Aaron Hirschi Title: Division President (End of signatures.)

---

tulespringsvillage2kb-fo

Exhibit 10.3 1614657636.2 FOURTH AMENDMENT TO PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (454.31 Acres +/- in Village 2 of Tule Springs) THIS FOURTH AMENDMENT TO PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (this “Amendment”) is made and entered into as of September 17, 2024 (the “Amendment Effective Date”), by and among PACIFIC OAK SOR TULE SPRINGS OWNER TRS, LLC, a Delaware limited liability company (“Parcel 2.09A Seller”), and PACIFIC OAK SOR TULE SPRINGS VILLAGE 2 PARCELS OWNER, LLC, a Delaware limited liability company (“Remainder Seller”, and together with Parcel 2.09A Seller, individually or collectively as context requires, “Seller”), and KB HOME LAS VEGAS INC., a Nevada corporation (“KB Home” or “Buyer”), with respect to the transactions contemplated by this Amendment. RECITALS A. Seller, KB Home, and Tri Pointe Homes Nevada, Inc., a Nevada corporation (“Tri Pointe”) entered into that certain Purchase and Sale Agreement and Joint Escrow Instructions dated as of March 10, 2024 (the “Original Purchase Agreement”), as amended by that certain First Amendment to Purchase and Sale Agreement and Joint Escrow Instructions dated as of June 17, 2024 (the “First Amendment”), and as amended by that certain Second Amendment to Purchase and Sale Agreement and Joint Escrow Instructions dated as of June 21, 2024 (the “Second Amendment”), and as further amended by that certain Third Amendment to Purchase and Sale Agreement and Joint Escrow Instructions dated as of August 16, 2024 (the “Third Amendment,” and together with the Original Purchase Agreement, First Amendment and Second Amendment, collectively, the “Purchase Agreement”). All capitalized terms used herein and not otherwise defined shall have the meanings ascribed to such terms in the Purchase Agreement. B. Seller and Buyer desire to further modify the terms of the Purchase Agreement as more particularly set forth in this Amendment. AGREEMENTS NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intended to be legally bound, Seller and Buyer hereby agree as follows: 1. Recitals. The Recitals set forth above are hereby incorporated herein by reference as if the same were fully set forth herein. 2. Extension of Due Diligence Period. Notwithstanding anything to the contrary in the Purchase Agreement, Buyer and Seller agree that the Due Diligence Period shall be, and hereby is, extended to September 30, 2024 (and the Due Diligence Termination Date shall be, and hereby is, accordingly extended to September 30, 2024). 3. Miscellaneous. Except as specifically amended hereby, the Purchase Agreement shall remain and continue in full force and effect. In the event of any conflict between the terms of the Purchase Agreement and the terms of this Amendment, the terms of this

---

SMRH:4895-5694-8452.2 -2- Fourth Amendment to PSA (Tule Springs - Village 2) 39ZR-379857 1614657636.2 Amendment shall control. This Amendment may be executed in as many counterparts as may be deemed necessary and convenient, and by the different parties hereto on separate counterparts, each of which, when so executed, shall be deemed an original, but all such counterparts shall constitute one and the same instrument. To facilitate execution of this Amendment, the parties may execute and exchange by telephone facsimile or by electronic mail in a “PDF” format counterparts of the signature pages. This Amendment may be signed by either Party by electronic signature using Authentisign, DocuSign or similar technology provided that the Party using such technology must submit an original, handwritten signature to the other Party promptly upon request. (Remainder of page intentionally left blank; signature pages follow.)

---

(Signature Page to Fourth Amendment to Purchase and Sale Agreement and Joint Escrow Instructions - Village 2) 1614657636.2 IN WITNESS WHEREOF, the undersigned parties have executed this Amendment to be effective as of the Amendment Effective Date. SELLER: PACIFIC OAK SOR TULE SPRINGS OWNER TRS, LLC, PACIFIC OAK SOR TULE SPRINGS VILLAGE 2 PARCELS OWNER, LLC, each, a Delaware limited liability company By: /s/ Brian Ragsdale Name: Brian Ragsdale Title: President (Signatures continue on following page.)

---

(Signature Page to Fourth Amendment to Purchase and Sale Agreement and Joint Escrow Instructions - Village 2) 1614657636.2 BUYER: KB HOME LAS VEGAS INC., a Nevada corporation By: /s/ Jim McDade Name: Jim McDade Title: Division President (End of signatures.)

---

tulespringsvillage2kb-fi

Exhibit 10.4 1614657642.2 FIFTH AMENDMENT TO PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (454.31 Acres +/- in Village 2 of Tule Springs) THIS FIFTH AMENDMENT TO PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (this “Amendment”) is made and entered into as of September 30, 2024 (the “Amendment Effective Date”), by and among PACIFIC OAK SOR TULE SPRINGS OWNER TRS, LLC, a Delaware limited liability company (“Parcel 2.09A Seller”), and PACIFIC OAK SOR TULE SPRINGS VILLAGE 2 PARCELS OWNER, LLC, a Delaware limited liability company (“Remainder Seller”, and together with Parcel 2.09A Seller, individually or collectively as context requires, “Seller”), and KB HOME LAS VEGAS INC., a Nevada corporation (“KB Home” or “Buyer”), with respect to the transactions contemplated by this Amendment. RECITALS A. Seller, KB Home, and Tri Pointe Homes Nevada, Inc., a Nevada corporation (“Tri Pointe”) entered into that certain Purchase and Sale Agreement and Joint Escrow Instructions dated as of March 10, 2024 (the “Original Purchase Agreement”), as amended by that certain First Amendment to Purchase and Sale Agreement and Joint Escrow Instructions dated as of June 17, 2024 (the “First Amendment”), as further amended by that certain Second Amendment to Purchase and Sale Agreement and Joint Escrow Instructions dated as of June 21, 2024 (the “Second Amendment”), as further amended by that certain Third Amendment to Purchase and Sale Agreement and Joint Escrow Instructions dated as of August 16, 2024 (“Third Amendment”), and as further amended by that certain Fourth Amendment to Purchase and Sale Agreement and Joint Escrow Instructions dated as of September 17, 2024 (the “Fourth Amendment,” and together with the Original Purchase Agreement, First Amendment, Second Amendment, and Third Amendment, collectively, the “Purchase Agreement”). All capitalized terms used herein and not otherwise defined shall have the meanings ascribed to such terms in the Purchase Agreement. B. Seller and Buyer desire to further modify the terms of the Purchase Agreement as more particularly set forth in this Amendment. AGREEMENTS NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intended to be legally bound, Seller and Buyer hereby agree as follows: 1. Recitals. The Recitals set forth above are hereby incorporated herein by reference as if the same were fully set forth herein. 2. Extension of Due Diligence Period. Notwithstanding anything to the contrary in the Purchase Agreement, Buyer and Seller agree that the Due Diligence Period shall be, and hereby is, extended to October 14, 2024 (and the Due Diligence Termination Date shall be, and hereby is, accordingly extended to October 14, 2024). SMRH:4881-0066-6090.2 -2- Fifth Amendment to PSA (Tule Springs - Village 2) 39ZR-379857 1614657642.2 3. Miscellaneous. Except as specifically amended hereby, the Purchase Agreement shall remain and continue in full force and effect. In the event of any conflict between the terms of the Purchase Agreement and the terms of this Amendment, the terms of this Amendment shall control. This Amendment may be executed in as many counterparts as may be deemed necessary and convenient, and by the different parties hereto on separate counterparts, each of which, when so executed, shall be deemed an original, but all such counterparts shall constitute one and the same instrument. To facilitate execution of this Amendment, the parties may execute and exchange by telephone facsimile or by electronic mail in a “PDF” format counterparts of the signature pages. This Amendment may be signed by either Party by electronic signature using Authentisign, DocuSign or similar technology provided that the Party using such technology must submit an original, handwritten signature to the other Party promptly upon request. (Remainder of page intentionally left blank; signature pages follow.) (Signature Page to Fifth Amendment to Purchase and Sale Agreement and Joint Escrow Instructions - Village 2) 1614657642.2 IN WITNESS WHEREOF, the undersigned parties have executed this Amendment to be effective as of the Amendment Effective Date. SELLER: PACIFIC OAK SOR TULE SPRINGS OWNER TRS, LLC, PACIFIC OAK SOR TULE SPRINGS VILLAGE 2 PARCELS OWNER, LLC, each, a Delaware limited liability company By: /s/ Brian Ragsdale Name: Brian Ragsdale Title: President (Signatures continue on following page.) (Signature Page to Fifth Amendment to Purchase and Sale Agreement and Joint Escrow Instructions - Village 2) 1614657642.2 BUYER: KB HOME LAS VEGAS INC., a Nevada corporation By: /s/ Jim McDade Name: Jim McDade Title: Division President (End of signatures.)

---

tulesp4

Exhibit 10.5 1614657647.2 SIXTH AMENDMENT TO PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (454.31 Acres +/- in Village 2 of Tule Springs) THIS SIXTH AMENDMENT TO PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (this “Amendment”) is made and entered into as of October 14, 2024 (the “Amendment Effective Date”), by and among PACIFIC OAK SOR TULE SPRINGS OWNER TRS, LLC, a Delaware limited liability company (“Parcel 2.09A Seller”), and PACIFIC OAK SOR TULE SPRINGS VILLAGE 2 PARCELS OWNER, LLC, a Delaware limited liability company (“Remainder Seller”, and together with Parcel 2.09A Seller, individually or collectively as context requires, “Seller”), and KB HOME LAS VEGAS INC., a Nevada corporation (“KB Home” or “Buyer”), with respect to the transactions contemplated by this Amendment. RECITALS A. Seller, KB Home, and Tri Pointe Homes Nevada, Inc., a Nevada corporation (“Tri Pointe”) entered into that certain Purchase and Sale Agreement and Joint Escrow Instructions dated as of March 10, 2024 (the “Original Purchase Agreement”), as amended by that certain First Amendment to Purchase and Sale Agreement and Joint Escrow Instructions dated as of June 17, 2024 (the “First Amendment”), as further amended by that certain Second Amendment to Purchase and Sale Agreement and Joint Escrow Instructions dated as of June 21, 2024 (the “Second Amendment”), as further amended by that certain Third Amendment to Purchase and Sale Agreement and Joint Escrow Instructions dated as of August 16, 2024 (“Third Amendment”), as further amended by that certain Fourth Amendment to Purchase and Sale Agreement and Joint Escrow Instructions dated as of September 17, 2024 (the “Fourth Amendment”), and as further amended by that certain Fifth Amendment to Purchase and Sale Agreement and Joint Escrow Instructions dated as of September 30, 2024 (the “Fifth Amendment”, and together with the Original Purchase Agreement, First Amendment, Second Amendment, Third Amendment, and Fourth Amendment, collectively, the “Purchase Agreement”). All capitalized terms used herein and not otherwise defined shall have the meanings ascribed to such terms in the Purchase Agreement. B. Seller and Buyer desire to further modify the terms of the Purchase Agreement as more particularly set forth in this Amendment. AGREEMENTS NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intended to be legally bound, Seller and Buyer hereby agree as follows: 1. Recitals. The Recitals set forth above are hereby incorporated herein by reference as if the same were fully set forth herein. 2. Extension of Due Diligence Period. Notwithstanding anything to the contrary in the Purchase Agreement, Buyer and Seller agree that the Due Diligence Period shall be, and hereby is, extended to October 18, 2024 (and the Due Diligence Termination Date shall be, and hereby is, accordingly extended to October 18, 2024). SMRH:4860-3471-7168.2 -2- Sixth Amendment to PSA (Tule Springs - Village 2) 39ZR-379857 1614657647.2 3. Miscellaneous. Except as specifically amended hereby, the Purchase Agreement shall remain and continue in full force and effect. In the event of any conflict between the terms of the Purchase Agreement and the terms of this Amendment, the terms of this Amendment shall control. This Amendment may be executed in as many counterparts as may be deemed necessary and convenient, and by the different parties hereto on separate counterparts, each of which, when so executed, shall be deemed an original, but all such counterparts shall constitute one and the same instrument. To facilitate execution of this Amendment, the parties may execute and exchange by telephone facsimile or by electronic mail in a “PDF” format counterparts of the signature pages. This Amendment may be signed by either Party by electronic signature using Authentisign, DocuSign or similar technology provided that the Party using such technology must submit an original, handwritten signature to the other Party promptly upon request. (Remainder of page intentionally left blank; signature pages follow.) (Signature Page to Sixth Amendment to Purchase and Sale Agreement and Joint Escrow Instructions - Village 2) 1614657647.2 IN WITNESS WHEREOF, the undersigned parties have executed this Amendment to be effective as of the Amendment Effective Date. SELLER: PACIFIC OAK SOR TULE SPRINGS OWNER TRS, LLC, PACIFIC OAK SOR TULE SPRINGS VILLAGE 2 PARCELS OWNER, LLC, each, a Delaware limited liability company By: /s/ Brian Ragsdale Name: Brian Ragsdale Title: President (Signatures continue on following page.) (Signature Page to Sixth Amendment to Purchase and Sale Agreement and Joint Escrow Instructions - Village 2) 1614657647.2 BUYER: KB HOME LAS VEGAS INC., a Nevada corporation By: /s/ Aaron Hirschi Name: Aaron Hirschi Title: Regional General Manager (End of signatures.)

---

tu56041

Exhibit 10.6 1614657673.2 SEVENTH AMENDMENT TO PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (454.31 Acres +/- in Village 2 of Tule Springs) THIS SEVENTH AMENDMENT TO PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (this “Amendment”) is made and entered into as of October 18, 2024 (the “Amendment Effective Date”), by and among PACIFIC OAK SOR TULE SPRINGS OWNER TRS, LLC, a Delaware limited liability company (“Parcel 2.09A Seller”), and PACIFIC OAK SOR TULE SPRINGS VILLAGE 2 PARCELS OWNER, LLC, a Delaware limited liability company (“Remainder Seller”, and together with Parcel 2.09A Seller, individually or collectively as context requires, “Seller”), and KB HOME LAS VEGAS INC., a Nevada corporation (“KB Home” or “Buyer”), with respect to the transactions contemplated by this Amendment. RECITALS A. Seller, KB Home, and Tri Pointe Homes Nevada, Inc., a Nevada corporation (“Tri Pointe”) entered into that certain Purchase and Sale Agreement and Joint Escrow Instructions dated as of March 10, 2024 (the “Original Purchase Agreement”), as amended by that certain First Amendment to Purchase and Sale Agreement and Joint Escrow Instructions dated as of June 17, 2024 (the “First Amendment”), as further amended by that certain Second Amendment to Purchase and Sale Agreement and Joint Escrow Instructions dated as of June 21, 2024 (the “Second Amendment”), as further amended by that certain Third Amendment to Purchase and Sale Agreement and Joint Escrow Instructions dated as of August 16, 2024 (the “Third Amendment”), as further amended by that certain Fourth Amendment to Purchase and Sale Agreement and Joint Escrow Instructions dated as of September 17, 2024 (the “Fourth Amendment”), as further amended by that certain Fifth Amendment to Purchase and Sale Agreement and Joint Escrow Instructions dated as of September 30, 2024 (the “Fifth Amendment”), and as further amended by that certain Sixth Amendment to Purchase and Sale Agreement and Joint Escrow Instructions dated as of October 14, 2024 (the “Sixth Amendment” and together with the Original Purchase Agreement, First Amendment, Second Amendment, Third Amendment, Fourth Amendment, and Fifth Amendment, collectively, the “Purchase Agreement”). All capitalized terms used herein and not otherwise defined shall have the meanings ascribed to such terms in the Purchase Agreement. B. Pursuant to the Second Amendment, Tri Pointe exited the transaction and KB Home became the only Buyer. C. Seller and Buyer desire to further modify the terms of the Purchase Agreement as more particularly set forth in this Amendment. Among other modifications, Buyer is exiting due diligence upon signing this Amendment, Buyer is acquiring the Property in three phases instead of two, and the parties are changing the closing dates for each phase. AGREEMENTS NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intended to be legally bound, Seller and Buyer hereby agree as follows: SMRH:4880-9479-5224.22 -2- 101824 39ZR-379857 1614657673.2 1. Recitals. The Recitals set forth above are hereby incorporated herein by reference as if the same were fully set forth herein. WAIVER OF DUE DILIGENCE 2. Expiration of Due Diligence Period. Buyer acknowledges and agrees that the Due Diligence Termination Date has expired as of the Amendment Effective Date and, therefore, in accordance with Section 3.3 of the Purchase Agreement, Buyer shall be deemed to be satisfied with all aspects of the Real Property and Buyer shall be obligated to acquire the Real Property in accordance with, and subject to, the provisions of the Purchase Agreement and this Amendment. 3. Waiver of Right to Terminate. Buyer acknowledges and agrees that it wishes to proceed with the acquisition of the Property subject to and in accordance with the terms and conditions of the Purchase Agreement. This Amendment shall constitute Buyer's Approval Notice and Buyer’s waiver of its right to terminate the Purchase Agreement pursuant to Section 3.3 thereof. NEW PHASING, CLOSING DATES, DEPOSIT, PRICE ALLOCATION 4. Closing in Three Phases. The Purchase Agreement currently contemplates that the Property will be purchased and sold in two (2) phases. Notwithstanding anything in the Purchase Agreement to the contrary, Buyer has requested, and Seller has agreed, to proceed with the purchase and sale of the Property in three (3) phases, as more particularly described in this Amendment. Phase 1, the Phase 1 Property, and the Phase 1 Purchase Price have not changed. Phase 2 and the Phase 2 Property shall be approximately 130.77 gross acres as shown on the phasing plan attached hereto as Exhibit B-3 (the “New Phasing Plan”), which shall supersede and replace Exhibit B-3 attached to the Purchase Agreement. The remainder of the original Phase 2 and the Phase 2 Property shall be new “Phase 3” and “Phase 3 Property”, comprising of approximately 111.40 gross acres as shown on the New Phasing Plan. Accordingly, all references in the Purchase Agreement to Phase 2 or the Phase 2 Property shall refer to Phase 2 as shown in the New Phasing Plan, and all references to Phase 3 or the Phase 3 Property in this Amendment shall refer to Phase 3 as shown in the New Phasing Plan. Finally, the provisions of the Purchase Agreement shall be reasonably interpreted to refer to the Closing in three (3) Phases, and the provisions of the Purchase Agreement shall apply to each Closing and the portion of Property purchased at such Closing, as applicable. For example, in Section 1.1 of the Purchase Agreement (which only specifically references the Phase 1 Closing), if the Purchase Agreement is terminated after the Phase 2 Closing but before the Phase 3 Closing, Section 1.1 would be interpreted to mean that the termination would relate solely to the Phase 3 Property and would not apply to matters pertaining to the Phase 1 Property and the Phase 2 Property that survive (or are deemed to survive) the Phase 1 Closing and the Phase 2 Closing. 5. Closing Date. Section 7.1 of the Purchase Agreement shall be, and hereby is, deleted in its entirety and the following paragraph shall be substituted in its place: “Subject to the provisions of this Agreement, (a) the Phase 1 Closing shall occur on December 3, 2024 (the “Phase 1 Closing Date”), (b) the Phase 2 Closing shall occur on December 1, 2026 (the “Phase 2 Closing Date”; and (c) the closing of the Phase 3 Property “the “Phase 3 Closing” shall occur on December 1, 2027 (the “Phase 3 Closing Date”, and together with the Phase 1 Closing Date and Phase 2 SMRH:4880-9479-5224.22 -3- 101824 39ZR-379857 1614657673.2 Closing Date, collectively referred to herein as, a “Closing Date”). Notwithstanding the foregoing, Buyer shall have the right to elect to accelerate the Closing Date for any Phase by providing Seller with at least thirty (30) days’ prior written notice, or such other notice period as the parties may mutually agree upon in writing, which written notice shall set forth the new Closing Date. 6. Definitions and Phrases. As of the Amendment Effective Date, unless specifically amended by this Amendment, all references in the Purchase Agreement to the following defined terms and phrases shall be amended as follows: (a) the phrase “Phase 1 or Phase 2” shall be deemed to refer to “Phase 1, Phase 2, or Phase 3”, as applicable, (b) the phrase “Phase 1 Property or Phase 2 Property” shall be deemed to refer to “Phase 1 Property, Phase 2 Property, or Phase 3 Property”, as applicable; (c) the phrase “Phase 1 Closing and Phase 2 Closing” shall be deemed to refer to the “Phase 1 Closing, Phase 2 Closing, and Phase 3 Closing”, as applicable; (d) the phrase “either Closing” shall be deemed to refer to “each Closing”, (d) “Closing” and “each Closing” shall collectively mean the Phase 1 Closing, Phase 2 Closing, and Phase 3 Closing, as applicable, and (e) the phrase “neither Closing” shall be deemed to refer to “none of the Closings”. 7. Deposit. Escrow Agent is currently holding the following portions of the Deposit in Escrow, in an aggregate amount of $2,400,000.00: (i) the Initial Deposit in the amount of $2,000,000.00, and (ii) the first installment of the Additional Deposit in the amount of $500,000.00, minus the $100,000.00 portion of the Initial Deposit that was nonrefundable to Buyer pursuant to the Second Amendment and released to Seller pursuant to the Third Amendment (the “Released Initial Deposit”). Notwithstanding anything stated to the contrary in the Purchase Agreement, Buyer shall deliver the remaining Deposit in two tranches as follows: (x) no later than 2 business days after the Amendment Effective Date, Buyer shall deposit into Escrow an additional sum of Two Million Six Hundred Thousand and No/100 Dollars ($2,600,000.00), which amount together with the existing $2,400,000.00 amount held in escrow shall become nonrefundable to Buyer (i.e. $5,000,000.00), except in the event the Purchase Agreement is terminated due to a default by Seller; and (y) at the Phase 1 Closing, Buyer shall deposit into Escrow the sum of Five Million and No/100 Dollars ($5,000,000.00). Subject to the timely delivery of the Parent Guaranty (defined below), at the Phase 1 Closing, the full amount of the Deposit then in Escrow (i.e., $10,000,000.00) shall be released to Seller and Escrow Agent is hereby directed to remit the Deposit to Seller without further instruction from Buyer or Seller. Notwithstanding the foregoing, the Deposit released to Seller shall be returned to Buyer if the Purchase Agreement is terminated due to a default by Seller, and Seller shall cause Pacific Oak SOR Properties, LLC, a Delaware limited liability company (the indirect 100% owner of Seller), to guarantee such payment obligations by executing and delivering a payment guaranty in favor of Buyer no later than November 25, 2024, in the form of Schedule 7 attached hereto made a part hereof (“Payment Guaranty”). The provisions of this Section 7 shall survive the termination of the Purchase Agreement. Notwithstanding anything to the contrary contained in the Purchase Agreement, including, without limitation, Sections 2.3.3, 2.4.2, and 7.4.1.2 thereof, the Deposit shall not be applicable to the Phase 2 Purchase Price at the Phase 2 Closing but shall be applicable to and fully credited against the Phase 3 Purchase Price at the Phase 3 Closing. SMRH:4880-9479-5224.22 -4- 101824 39ZR-379857 1614657673.2 8. Purchase Price; Construction Exactions. Notwithstanding anything stated to the contrary in the Purchase Agreement, including Sections 1.3.1, 1.3.2, 2.3.3, 2.4, 2.6, and 7.4.1.2 thereof, the allocation and payment of the Purchase Price and Construction Exactions shall be amended as follows: 8.1 Phase 1 Property. Phase 1 and the Phase 1 Property shall remain at 212.14 gross acres and the Phase 1 Purchase Price shall remain as Ninety-One Million Fifty-Five Thousand Two Hundred Twenty-Seven and No/100 ($91,055,227.00). At the Phase 1 Closing, Buyer shall pay cash in an amount equal to (i) the Phase 1 Purchase Price, (ii) the Phase 1 Construction Exaction Amount, and (iii) all of the applicable Buyer’s Closing Costs for the Phase 1 Property (and otherwise sufficient to close the transaction contemplated herein), as contemplated in the Purchase Agreement. 8.2 Phase 2 Property. Phase 2 and the Phase 2 Property shall be approximately 130.77 gross acres, and the Phase 2 Purchase Price shall be Fifty-Two Million Two Hundred Ninety Thousand Five Hundred Forty-Six and No/100 Dollars ($52,290,546.00). At the Phase 2 Closing, Buyer shall pay cash in an amount equal to (i) the Phase 2 Purchase Price, (ii) the Phase 2 Construction Exaction Amount, and (iii) all of the applicable Buyer’s Closing Costs for the Phase 2 Property (and otherwise sufficient to close the transaction contemplated herein). The Phase 2 Construction Exaction Amount set forth in Section 2.6 of the Purchase Agreement shall remain unchanged, and the full Phase 2 Construction Exaction Amount is to be paid at the Phase 2 Closing. 8.3 Phase 3 Property. Phase 3 and the Phase 3 Property shall be approximately 111.40 gross acres, and the “Phase 3 Purchase Price” shall be Fifty-One Million Six Hundred Fifty-Four Thousand Two Hundred Twenty-Seven and No/100 Dollars ($51,654,227.00). At the Phase 3 Closing, Buyer shall pay cash in an amount equal to (i) the Phase 3 Purchase Price less the Deposit (except for the Additional Extension Deposit previously released to Seller in the amount of $100,000.00, which shall not be applicable to the Purchase Price to be paid at Closing, as provided in the Third Amendment), and (ii) all of the applicable Buyer’s Closing Costs for the Phase 3 Property (and otherwise sufficient to close the transaction contemplated herein). No Construction Exactions will be paid at the Phase 3 Closing. 8.4 No Land Exactions. For the avoidance of doubt, Seller waived and Buyer is not paying any “land exactions” as set forth in Section 2.6 of the Purchase Agreement. 8.5 Potential Phase 2 Closing Credit. Buyer has advised Seller that the required slope lines may result in a loss of the developable acreage in the northern portion of the commercial parcel identified as “Parcel 2.01 and Parcel 2.08”. Buyer shall use commercially reasonable efforts to obtain the City’s approval of the originally planned slope lines so that the northern portion of such Parcel 2.01 and Parcel 2.08 may be developed, but if as of the Phase 2 Closing, the City- required slope line results in a reduction of developable acreage of Parcel 2.01 or Parcel 2.08, then Buyer shall be entitled to a credit against the Phase 2 Purchase Price in the amount of One Million Two Hundred Fourteen Thousand Nine Hundred Forty-Six and No/100 Dollars ($1,214,946.00). 9. Extension Fee. In consideration of Seller’s agreement to extend the Closing Date for each Phase as provided in this Amendment, commencing on December 1, 2025 and continuing on the first day of each calendar month thereafter, Buyer shall deliver to Seller a monthly extension

---

SMRH:4880-9479-5224.22 -5- 101824 39ZR-379857 1614657673.2 fee (each, a “Monthly Extension Fee”, and collectively, the “Monthly Extension Fees”) in an amount equal to six percent (6%) per annum of the aggregate sum of the Phase 2 Purchase Price and the Phase 3 Purchase Price (i.e. $519,723.86 per month). Following the Phase 2 Closing and until the Phase 3 Closing, the Monthly Extension Fees shall be adjusted to reflect an amount equal to six percent (6%) per annum of the Phase 3 Purchase Price only (i.e. $258,271.14 per month). The Monthly Extension Fees shall be non-refundable to Buyer and shall not be applicable to the Purchase Price to be paid at any Closing. 10. Sections 1.3.1 and 1.3.2; Exhibit B-3 – The Phase 3 Property. Sections 1.3.1 and 1.3.2 of the Purchase Agreement and the corresponding exhibits provide for the Phasing Plan and the survey depictions of Phase 1 and Phase 2. Notwithstanding anything stated to the contrary in the Purchase Agreement, including, without limitation, Sections 1.3.1 and 1.3.2 thereof, Phase 3 to be purchased by Buyer is depicted on the Phasing Plan attached hereto as Exhibit B-3, and the revised Phase 2 is also shown on Exhibit B-3 attached hereto. Further, Exhibit B-1 attached to the Purchase Agreement remains unchanged, but Exhibit B-2 attached to the Purchase Agreement showing Phase 2 shall be, and hereby is, deleted in its entirely, given that the revised Phase 2 is now shown on the Phasing Plan attached hereto as Exhibit B-3. MODIFICATIONS TO ARTICLE 2 11. Section 2.5 – Purchase Price Reflects Future Infrastructure Costs. The overall Infrastructure Work has not changed, but the Infrastructure Work, and timing of completion thereof, must be allocated between the three Phases. As amended in Section 12 below, the Buyer Infrastructure Development Obligations Narrative separately designates the portions of the Infrastructure Work which will comprise of the off-site infrastructure and onsite infrastructure work and improvements required for the Phase 1 Infrastructure Work, Phase 2 Infrastructure Work, and for the development of the Phase 3 Property (the “Phase 3 Infrastructure Work”). Subject to and following the Phase 3 Closing, Buyer (or Buyer’s Designee) shall be responsible for the construction of the Phase 3 Infrastructure Work. If the Purchase Agreement is terminated for any reason after the Phase 1 Closing and Phase 2 Closing occur but prior to the Phase 3 Closing hereunder, Buyer (or Buyer’s Designee) shall only be obligated to construct (or cause the construction of) the Phase 1 Infrastructure Work and Phase 2 Infrastructure Work and shall have no obligation whatsoever under the Purchase Agreement or otherwise to construct or complete the Phase 3 Infrastructure Work. Notwithstanding the foregoing and anything to the contrary in the Purchase Agreement, if the Phase 1 Closing occurs, (i) Buyer shall complete the construction of the Phase 1 Infrastructure Work prior to the Phase 2 Closing, subject to Force Majeure Delay (as such term is defined in the Infrastructure Development Agreement), if applicable, and (ii) Buyer shall be responsible to complete the Casino Site Infrastructure Work pursuant to Section 2.5.2 of the Purchase Agreement. Further, Section 2.5.2 of the Purchase Agreement is hereby amended and modified to add the following language to the end of the paragraph: “Buyer and Seller acknowledge and agree that the Infrastructure Work and the Casino Site Infrastructure Work detailed in the Agreement and Schedule 2.5.2(B) is subject to and shall be automatically modified to the extent reasonably necessary to conform with the requirements hereafter established by the City or any other governmental or quasi-governmental agency, NV Energy, SW Gas, and any other utility SMRH:4880-9479-5224.22 -6- 101824 39ZR-379857 1614657673.2 provider in connection with the development of the Property and the Village 2 Casino Property, as may be applicable.” 12. Schedule 2.5.2(B) – Buyer Infrastructure Development Obligations Narrative. To memorialize the parties’ agreement as to the Phase 3 Infrastructure Work, the Required Finished Height, the Required Fill, and the Required Fill Source, the Buyer Infrastructure Development Obligations Narrative set forth on Schedule 2.5.2(B) of the Purchase Agreement is hereby superseded and replaced in its entirety with Schedule 2.5.2(B) attached hereto and incorporated herein by reference. 13. Section 2.5.3 – Finished Height of North 5th Street and Quantity of Fill Required for Import Stockpile. Buyer and Seller hereby agree that the finished height of North 5th Street adjacent to the N 5th Fill Parcels to meet the North 5th Access Grading requirements is 2,124.20 feet (the “Required Finished Height”). The Required Finished Height is reflected in the Buyer Infrastructure Development Obligations Narrative set forth in Schedule 2.5.2(B) attached to this Amendment. Buyer and Seller further agree that the quantity of fill required for the Import Stockpile shall be 141,302 cubic yards (the “Required Fill”) and such amount of fill will be available to Buyer for import onto the N 5th Fill Parcels from the Phase 1 Property and/or the Phase 2 Property adjacent to the N 5th Fill Parcels (the “Required Fill Source”), which Required Fill and Required Fill Source is reflected in the Buyer Infrastructure Development Obligations Narrative set forth in Schedule 2.5.2(B), as amended hereby. 14. Schedule 2.5.3 - Form of Construction License Agreement. Pursuant to Section 2.5.3 of the Purchase Agreement, the parties hereby agree that the approved form of Construction License Agreement is attached hereto as Schedule 2.5.3 (subject to completion of any blanks and missing information and exhibits, if any). Schedule 2.5.3 attached hereto shall be, and hereby is, attached to the Purchase Agreement as Schedule 2.5.3. 15. Sections 2.6 – Construction Exactions. As described in Section 8 above, the Construction Exactions described in Section 2.6 of the Purchase Agreement will not change, such that the Phase 2 Construction Exaction Amount will continue to be paid at the Phase 2 Closing and no Construction Exactions will be paid at the Phase 3 Closing. MODIFICATIONS TO ARTICLE 3 AND 4 16. Section 3.4.1 – Title Deliveries by Seller. Notwithstanding anything stated to the contrary in the Purchase Agreement, including, without limitation, Sections 3.4.1 and 3.4.2 thereof, Buyer shall be deemed to have received and approved the Title Report and Survey, if any. 17. Section 3.6 – Assignment of Plans. The Purchase Agreement currently provides that Seller shall use commercially reasonable efforts to obtain the Consents to assign to Buyer all of Seller’s rights in the Plans and Contracts. Notwithstanding the provisions of Section 3.6 of the Purchase Agreement, Buyer hereby acknowledges and agrees that it has waived its right to receive the Consents and the related right to terminate the Purchase Agreement under Section 3.6 thereof. Accordingly, the second, third, and fourth sentences of Section 3.6 of the Purchase Agreement and the form of Consent attached as Exhibit M to the Purchase Agreement shall be hereby deleted in their entirety. The parties hereby agree that the Plans shall be assigned to Buyer by a general SMRH:4880-9479-5224.22 -7- 101824 39ZR-379857 1614657673.2 assignment in the form attached hereto as Exhibit L (subject to completion of any blanks and missing information and exhibits, if any). The form of Assignment of Plans attached as Exhibit L to the Purchase Agreement shall be, and hereby is, deleted therefrom, and Exhibit L attached hereto shall be, and hereby is, substituted in its place and stead. 18. Section 4.7 – Village 2 Association Documents. Pursuant to Section 4.7 of the Purchase Agreement, the parties hereby agree that the approved forms of the Village 2 Association Documents are attached hereto as Schedule 4.7(A) (subject to completion of any blanks and missing information and exhibits, if any). Schedule 4.7(A) attached hereto shall be, and hereby is, attached to the Purchase Agreement as Schedule 4.7(A). The Village 2 Association Documents shall consist of the following: (i) Village 2 Owners Association Declaration, (ii) Bylaws of the Villages at Tule Springs, Village 2 Community Association, (iii) Articles of Formation – Nonprofit Corporation, and (iv) Additional Articles of Incorporation of the Villages at Tule Springs, Village 2 Community Association. In the event that Buyer desires to finalize and record (or cause to be recorded) the Village 2 Owners Association Declaration in the Official Records before the Phase 3 Closing Date, then, prior to or concurrently with such recording, Buyer and Seller shall enter into a partial assignment and assumption agreement with respect to the rights of Buyer and/or the Village Developer, as applicable, as the declarants under the Village 2 Owners Association Declaration, in the form of Schedule 4.7(B) attached hereto and made a part hereof. The provisions of this Section shall survive each applicable Closing. 19. Section 4.10.2 – Easements for the Development of Village 2. Pursuant to Section 4.10.2 of the Purchase Agreement, the parties hereby agree that the approved forms of the assignment of the Southern Easement Agreement and the assignment and assumption of the Temporary Drainage Easement Agreement are attached hereto in the forms of Schedule 4.10.2(A) (the “Assignment of Southern Easement”) and Schedule 4.10.2(B) (the “Assignment of Temporary Drainage Easement”), respectively (subject to completion of any blanks and missing information and exhibits, if any). Schedule 4.10.2(A) and Schedule 4.10.2(B) attached hereto shall be, and hereby are, attached to the Purchase Agreement as Schedule 4.10.2(A) and Schedule 4.10.2(B). 20. Sections 4.10.3, 6.1, 6.2.1, 6.2.2, 6.11.5 – General Interpretation to Reflect Phase 3. The Purchase Agreement currently provides for certain deadlines and references based on the Closing occurring in two (2) phases, which shall be amended to reflect Closing in three (3) phases. Notwithstanding anything stated to the contrary in the Purchase Agreement, Sections 4.10.3, 6.1, 6.2.1, 6.2.2, and 6.11.5 of the Purchase Agreement are hereby amended and modified to (a) replace the reference to the “Phase 1 Closing” therein with the “Phase 1 Closing and/or the Phase 2 Closing, as applicable”; (b) replace the reference to the “Phase 2 Property” therein with the “Phase 2 Property and/or the Phase 3 Property, as applicable”, (c) replace the reference to the “Phase 2 Closing” therein with the “Phase 3 Closing”, and (d) replace the reference to the “Phase 1 Infrastructure Work” therein with the “Phase 1 Infrastructure Work and/or the Phase 2 Infrastructure Work, as applicable.” 21. Section 4.10.4 – Utility Corridor Easement. Pursuant to Section 4.10.4 of the Purchase Agreement, the parties hereby agree that the approved form of Phase 2 Utility Corridor SMRH:4880-9479-5224.22 -8- 101824 39ZR-379857 1614657673.2 Easement is attached hereto as Schedule 4.10.4 (subject to completion of any blanks and missing information and exhibits, if any) and applicable to the Phase 2 Property and the Phase 3 Property. Schedule 4.10.4 attached hereto shall be, and hereby is, attached to the Purchase Agreement as Schedule 4.10.4. Furthermore, notwithstanding the provisions of Section 4.10 of the Purchase Agreement, Seller (a) agrees to execute such deed(s) of dedication before the Phase 1 Closing in the form required by the City as may be requested by Buyer, at Buyer’s sole cost and expense, for the dedication of “Street A” from North 5th Street to Losee Road, together with such additional adjacent common elements area as may be required for public utility easements; (b) agrees to execute and deliver such permissions to grade agreements as may be reasonably requested by Buyer, at Buyer’s sole cost and expense, over and across portions of the Phase 2 Property and/or the Phase 3 Property; and (c) shall grant such other easements as may be reasonably requested by Buyer over and across portions of the Phase 2 Property and/or the Phase 3 Property, as may be reasonably necessary to develop the Property. MODIFICATIONS TO ARTICLES 5-8 22. Sections 5.1, 5.2, 5.3, and 7.2.1 – Entitlements Condition. Notwithstanding anything stated to the contrary in the Purchase Agreement, including Sections 5.1, 5.2, 5.3, and 7.2.1, Seller has received Final Approval of the Required Entitlement Documents and shall hereby be deemed to have satisfied the Entitlements Condition. Accordingly, Buyer shall no longer have the right to extend the Phase 1 Closing Date or terminate the Purchase Agreement under Section 5.3.5 thereof or otherwise because of the non-satisfaction of the Entitlements Condition. Notwithstanding the foregoing, to the extent that Buyer determines any further amendments or modifications to the approved Required Entitlement Documents are needed, such amendments and/or modifications shall be deemed a Buyer Entitlement Matter subject to Section 5.4 of the Purchase Agreement and shall not be a condition of Closing. Furthermore, the parties acknowledge that each of the Phase 2 Property and the Phase 3 Property are not current legal parcels for the proposed division of the Property into the Phase 2 Property and the Phase 3 Property to be conveyed to Buyer at the Phase 2 Closing and the Phase 3 Closing in accordance with the Phasing Plan. As such, the parties agree that Buyer shall, at Buyer’s sole cost and expense, prepare and submit to the City such parcel or subdivision maps as Buyer may deem reasonably necessary and Seller agrees to cooperate with Buyer in order to accomplish the foregoing; provided, however, that Buyer’s pursuit and submission of any such parcel and/or subdivision maps shall be subject to Seller’s prior review and approval pursuant to the Seller Review Standard. 23. Sections 5.5.2 and 5.5.3 – Creation of Special Improvement Districts. Notwithstanding anything to the contrary in Sections 5.5.2 and 5.5.3 of the Purchase Agreement, the restrictions and limitations set forth in Sections 5.5.2 and 5.5.3 (limiting applying for and creating a SID prior to a Closing) shall also apply to the Phase 3 Property prior to the Phase 3 Closing. 24. Section 6.2.1 and 6.2.2 – Infrastructure Improvement Plans. Without limiting the applicability of general modifications described in Section 20 above, the provisions of Sections

---

SMRH:4880-9479-5224.22 -9- 101824 39ZR-379857 1614657673.2 6.2.1 and 6.2.2 shall apply to the Infrastructure Improvement Plans necessary for the Phase 3 Infrastructure Work as if Section 6.2.1 and 6.2.2 had initially referenced the three Phases and the Buyer Infrastructure Work had initially been divided by three Phases. 25. Section 6.3 – Village Developer Assignment; City Village Developer Consent. Pursuant to Section 6.3 of the Purchase Agreement, the parties hereby agree that the approved form of Village Developer Assignment is attached hereto as Schedule 6.3 (subject to completion of any blanks and missing information and exhibits, if any). The form of Village Developer Assignment attached as Schedule 6.3 to the Purchase Agreement shall be, and hereby is, deleted therefrom, and Schedule 6.3 attached hereto shall be, and hereby is, substituted in its place and stead. Further, notwithstanding anything stated to the contrary in the Purchase Agreement, including, without limitation, Section 6.3 thereof, the City Village Developer Consent was not included within the Major Modification submitted to and approved by the City, and, as such, Seller shall continue to (and Seller shall cause Master Developer to) work after the Amendment Effective Date to obtain such City Village Developer Consent. 26. Sections 6.3, 7.3.7, and 7.4.3 – Assignment of Village 2 Developer Rights. Pursuant to Section 6.3 of the Purchase Agreement, the parties hereby agree that the approved form of Village Developer Amendment is attached hereto as Schedule 6.3.1 (subject to completion of any blanks and missing information and exhibits, if any). Schedule 6.3.1 attached hereto shall be, and hereby is, attached to the Purchase Agreement as Schedule 6.3.1. Notwithstanding the foregoing or anything stated to the contrary in the Purchase Agreement, including, without limitation, Sections 6.3, 7.3.7, and 7.4.3 thereof, the Master Developer shall assign the rights and obligations of the Village Developer for Village 2 with respect to the Phase 3 Property at the Phase 3 Closing, and Buyer and Seller shall deliver an original, duly executed VDA Amendment at the Phase 3 Closing in the form of Schedule 6.3.1 attached hereto and made a part hereof (subject to revisions for the amendment to apply to the Phase 3 Property and not the Phase 2 Property). 27. Sections 6.4.1 and 6.4.2 – Compliance with TUSK Agreement; Assignment. Section 6.4.1 of the Purchase Agreement is hereby amended and modified to add the following language to the end of the paragraph: “Buyer and Seller acknowledge and agree that the obligations to be assumed by the Buyer under the TUSK Assignment Agreement (including without limitation, the Monument Trailhead Improvements) with respect to the improvements on P2.03 shall be limited to the improvements detailed in Exhibits “F” and “G” to the TUSK Agreement and Buyer’s obligations shall include any landscape improvements on P2.03.” Pursuant to Section 6.4.2 of the Purchase Agreement, the parties hereby agree that the approved form of TUSK Assignment Agreement is attached hereto as Schedule 6.4.2 (subject to completion of any blanks and missing information and exhibits, if any). Schedule 6.4.2 attached hereto shall be, and hereby is, attached to the Purchase Agreement as Schedule 6.4.2. 28. Section 6.6 – Existing Performance Deed of Trust; Alternative Security. Pursuant to the New Phasing Plan, the purchase and sale of Parcel 2.09A, which is subject to the Performance Deed of Trust, will be split between the Phase 2 Closing and the Phase 3 Closing. Because of this the requirements and applicability of Section 6.6 of the Purchase Agreement to the “Phase 2 Closing”, such that the Performance Deed of Trust shall be released at the Phase 2 Closing SMRH:4880-9479-5224.22 -10- 101824 39ZR-379857 1614657673.2 and Buyer shall have satisfied the Performance Deed of Trust Release Conditions at the Phase 2 Closing. 29. Section 6.7.1 – Trailhead Exactions Infrastructure Development Agreement. Section 6.7.1 of the Purchase Agreement is hereby amended and modified to add the following language to the end of the paragraph: “For the avoidance of doubt, the Monument Trailhead Improvements shall expressly include any landscaping improvements within the CNLV Monuments Trailhead (as defined in the TUSK Agreement) located on the Finger Parcel” (and which landscaping improvements are defined as the Additional Improvements in Section 31 hereof). Further, pursuant to Section 6.7.1 of the Purchase Agreement, the parties agree that the approved form of Monument Trailhead Infrastructure Development Agreement is attached hereto as Schedule 6.7.1 (subject to completion of any blanks and missing information and exhibits, if any). The form of Monument Trailhead Infrastructure Development Agreement attached as Schedule 6.7.1 to the Purchase Agreement shall be, and hereby is, deleted therefrom, and Schedule 6.7.1 attached hereto shall be, and hereby is, substituted in its place and stead. 30. Schedule 6.7.2 – Form of Monument Trailhead Escrow Agreements. Pursuant to Section 6.7.2 of the Purchase Agreement, the parties hereby agree that (i) the approved form of Monument Trailhead Escrow Agreement for the engineering and design of the Monument Trailhead Improvements is attached hereto as Schedule 6.7.2(A) (subject to completion of any blanks and missing information and exhibits, if any, including specific escrow account information), and (ii) the approved form of Monument Trailhead Escrow Agreement for the construction of the Monument Trailhead Improvements is attached hereto as Schedule 6.7.2(B) subject to completion of any blanks and missing information and exhibits, if any, including specific escrow account information). Schedule 6.7.2(A) and Schedule 6.7.2(B) shall be, and hereby is, attached to the Purchase Agreement as Schedule 6.7.2(A) and Schedule 6.7.2(B), respectively. 31. Section 6.7.2 – Trailhead Funding. Based on increased material and construction costs to fulfill the infrastructure obligations outlined in the TUSK Agreement, and certain additional improvements that were agreed upon between Seller (or its affiliates) and the City in conjunction with the most recent Major Modification to the Development Agreement (the “Additional Improvements”), as well as ongoing work and anticipated requirements from the City, the parties acknowledge and agree that the amount of the Monument Trailhead Funds in Section 6.7.2 of the Purchase Agreement is hereby increased to $5,815,240.80, and that the amounts set forth in both of the Monument Trailhead Escrow Agreements will be adjusted accordingly. Notwithstanding the foregoing, in the event that the City does not require a sewer line between N. 5th Street and the restrooms within the Trailhead Improvements, which results in actual cost savings to Buyer, Buyer shall pay to Seller the total amount of Buyer’s actual cost savings. 32. Sections 6.9.3 – Phase 4 Infrastructure Holdback Escrow Agreement. Pursuant to Section 6.9.3 of the Purchase Agreement, the parties hereby agree that the approved form of Phase 4 Infrastructure Holdback Escrow Agreement is attached hereto as Schedule 6.9.3 (subject to completion of any blanks and missing information and exhibits, if any). Schedule 6.9.3 attached hereto shall be, and hereby is, attached to the Purchase Agreement as Schedule 6.9.3. SMRH:4880-9479-5224.22 -11- 101824 39ZR-379857 1614657673.2 33. Section 6.9.4 – D.R. Horton Closing. Seller has advised Buyer that D.R. Horton (through a land banking relationship) has closed on the Village 1 Phase 4 land on October 3, 2024. D.R. Horton is the Village 1 Village Developer and owns, together with its land banker(s), all the developable land in Village 1 of the Planned Community. Seller has delivered to Buyer a copy of the Phase 4 Infrastructure Development Agreement. The approved form of Assignment of Phase 4 IDA Step-In Rights is attached hereto as Schedule 6.9.4 (subject to completion of any blanks and missing information and exhibits, if any). Schedule 6.9.4 shall be, and hereby is, attached to the Purchase Agreement as Schedule 6.9.4. At the Phase 1 Closing, Seller and Buyer or the Village Developer shall execute the Assignment of Phase 4 IDA Step-In Rights and Seller shall provide written notice to D.R. Horton of such assignment in accordance with Section 1.2.8 of the Phase 4 Infrastructure Development Agreement (and copy Buyer and Village Developer on such notice). 34. Section 6.11 – NV Energy MPU Agreement. Notwithstanding anything stated to the contrary in Section 6.11.2 of the Purchase Agreement, Buyer shall also work directly with NV Energy to enter into one or more separate NVE-required addendums to the NVE MPU Agreement as related to the Phase 3 Property (each or collectively, the “Phase 3 MPU Addendum”) and Seller shall cause Master Developer to cooperate with such efforts in accordance with Section 6.11.2. Further, all of Buyer’s and Seller’s rights, obligations, and acknowledgments under Section 6.11 shall apply to the Phase 3 Property with respect to the Phase 3 Closing, to such extent as though the Phase 3 Property and the Phase 3 MPU Addendum had been originally contemplated within the scope of Section 6.11. Buyer shall be solely responsible for the payment of the wire advancement fee in connection with the Phase 3 MPU Addendum, together with any costs and expenses in connection with additional agreements with respect to the Property in addition to the Phase 3 Addendum. Notwithstanding the foregoing or anything stated to the contrary in the Purchase Agreement, the NVE MPU Assignment described in Sections 6.11.5, 7.3.10 and 7.4.7 thereof, shall be executed at the Phase 3 Closing and not the Phase 2 Closing. 35. Section 7 – Closing Deliveries. Notwithstanding anything to the contrary contained herein, the parties acknowledge that the Phase 1 Closing is scheduled to occur after various holidays such that the parties agree to cause all closing deliverables for the Phase 1 Closing required pursuant to Sections 7.3 and 7.4 to be delivered into Escrow on or before Monday, November 25, 2024, except for the funds due from Buyer pursuant to Section 7.4.1.1 which shall be delivered into Escrow on the Phase 1 Closing Date. 36. Section 7.2 – Buyer’s Conditions Precedent to Closing. The Purchase Agreement is hereby amended to add the following conditions to Section 7.2 as Buyer’s Conditions Precedent; provided, however, in the event that the condition set forth in Section 7.2.8 hereof has not been satisfied by November 22, 2024, Seller shall have the right to elect to extend the Phase 1 Closing Date one or more times, not to exceed one-hundred and twenty (120) days in the aggregate, by delivering written notice to Buyer at least two (2) business days prior to the Phase 1 Closing Date, and the new Phase 1 Closing Date shall be extended to the date that is ten (10) days after the date on which Seller satisfies the condition as provided below. 7.2.8. Infrastructure Development Agreement Amendment. No later than November 22, 2024, Seller shall cause the Infrastructure Development Agreement by and among SMRH:4880-9479-5224.22 -12- 101824 39ZR-379857 1614657673.2 Seller, Master Developer and the Village 2 Casino Property Owner to be amended to extend the Outside Commencement Date thereunder to December 31, 2026, and to extend the Outside Completion Date thereunder to December 31, 2028, in a form reasonably acceptable to Buyer. 7.2.9. Payment Guaranty. No later than November 25, 2024, Seller shall have delivered the duly executed Payment Guaranty to Buyer in accordance with this Amendment. 7.2.10. City Village Developer Consent. No later than November 25, 2024, Seller shall have obtained the City Village Developer Consent. If the City Village Developer Consent has not been obtained by such date, then Buyer and Seller shall continue to (and Seller shall cause Master Developer to) work together after the Phase 1 Closing Date to obtain such City Village Developer Consent in accordance with Section 6.3 of the Purchase Agreement. 7.2.11. NPS/City Consent. No later than November 25, 2024, NPS and the City shall have approved the TUSK Assignment Agreement in the form of Consent to Partial Assignment and Assumption of Agreement attached to the TUSK Assignment Agreement (See Schedule 6.4.2 attached hereof). If, for any reason, NPS or the City does not approve the TUSK Assignment Agreement by such date, the parties shall continue to work together after the Phase 1 Closing Date to obtain such consent in accordance with Section 6.4.2 of the Purchase Agreement. 37. Section 7.3.5 – Release from Planned Community Exactions. Notwithstanding anything stated to the contrary in the Purchase Agreement, the Release from Planned Community Exactions executed at the Phase 2 Closing shall apply to both the Phase 2 Property and the Phase 3 Property. 38. Section 7.9 – Survival of Subsequent Closings. Notwithstanding anything to the contrary contained in the Purchase Agreement, including Section 7.9 thereof, the parties agree that the provisions of the Purchase Agreement, including, without limitation, any provision which contemplates performance or pertains to matters occurring after the Phase 1 Closing but prior to the Phase 2 Closing or Phase 3 Closing, shall survive the Phase 1 Closing, except for any provisions which specifically state that such provision does not survive the Phase 1 Closing; provided, however, if the Purchase Agreement is terminated for any reason after the Phase 1 Closing has occurred but before the Phase 2 Closing has occurred, then such termination shall not apply to (and shall not be deemed to apply to) any provisions of the Purchase Agreement which pertain to the Phase 1 Closing or the Phase 1 Property and which survive (or are deemed to survive) the Phase 1 Closing; and provided further, if the Purchase Agreement is terminated for any reason after the Phase 1 Closing and Phase 2 Closing have occurred but before the Phase 3 Closing has occurred, then such termination shall not apply to (and shall not be deemed to apply to) any provisions of the Purchase Agreement which pertain to the Phase 1 Closing, the Phase 2 Closing, the Phase 1 Property, or the Phase 2 Property and which survive (or are deemed to survive) the Phase 1 Closing and the Phase 2 Closing. 39. Section 8 – Seller’s Representations and Warranties. Notwithstanding anything stated to the contrary in the Purchase Agreement, including, without limitation, Section 8 thereof, Seller shall not be required to make representations as to the Phase 1 Property or Phase 2 Property at the Phase 3 Closing, but shall make such representations as to the Phase 3 Property.

---

SMRH:4880-9479-5224.22 -13- 101824 39ZR-379857 1614657673.2 40. Section 8.13.2 – Seller REIT Holdback Approval. Notwithstanding anything stated to the contrary in the Purchase Agreement, including Section 8.13.2 thereof, Seller has received the Seller REIT Holdback Approval and shall hereby be deemed to have satisfied Seller’s obligations under Section 8.13.2. Accordingly, neither Seller nor Buyer shall have the right to terminate the Purchase Agreement pursuant to Section 8.13.2 thereof. 41. Section 9.1 – Buyer Due Organization. Notwithstanding anything stated to the contrary in the Purchase Agreement, Section 9.1 of the Purchase Agreement is hereby amended and modified to replace the reference to “[limited liability company]” therein with “corporation”, to reflect the due organization of the Buyer entity. MISCELLANEOUS PROVISIONS 42. Miscellaneous. Except as specifically amended hereby, the Purchase Agreement shall remain and continue in full force and effect. This Amendment may be executed in as many counterparts as may be deemed necessary and convenient, and by the different parties hereto on separate counterparts, each of which, when so executed, shall be deemed an original, but all such counterparts shall constitute one and the same instrument. To facilitate execution of this Amendment, the parties may execute and exchange by telephone facsimile or by electronic mail in a “PDF” format counterparts of the signature pages. This Amendment may be signed by either Party by electronic signature using Authentisign, DocuSign or similar technology provided that the Party using such technology must submit an original, handwritten signature to the other Party promptly upon request. 43. Exhibits and Schedules. For ease of reference, this Amendment contains a list of the Exhibits and Schedules to the Purchase Agreement in order to reflect which Exhibits and Schedules are unchanged, have been replaced, or have been added by this Amendment. (Remainder of page intentionally left blank; signature pages follow.) SMRH:4880-9479-5224.22 -14- 101824 39ZR-379857 1614657673.2 IN WITNESS WHEREOF, the undersigned parties have executed this Amendment to be effective as of the Amendment Effective Date. SELLER: PACIFIC OAK SOR TULE SPRINGS OWNER TRS, LLC, PACIFIC OAK SOR TULE SPRINGS VILLAGE 2 PARCELS OWNER, LLC, each, a Delaware limited liability company By: /s/ Brian Ragsdale Name: Brian Ragsdale Title: President (Signatures continue on following page.) SMRH:4880-9479-5224.22 -15- 101824 39ZR-379857 1614657673.2 BUYER: KB HOME LAS VEGAS INC., a Nevada corporation By: /s/ Jim McDade Name: Jim McDade Title: Division President (End of signatures.) SMRH:4880-9479-5224.22 -16- 101824 39ZR-379857 1614657673.2 LIST OF EXHIBITS AND SCHEDULES TO THE AGREEMENT No. Name of Exhibit/ Schedule After the Amendment Effective Date EXHIBIT A LEGAL DESCRIPTION OF THE PROPERTY Unchanged EXHIBIT B CURRENT VILLAGE 2 FINAL MAP Unchanged EXHIBIT B-1 SURVEY DEPICTION OF PHASE 1 PROPERTY Unchanged EXHIBIT B-2 SURVEY DEPICTION OF PHASE 2 PROPERTY Deleted; partially replaced by new B-3 EXHIBIT B-3 PHASING PLAN Original replaced EXHIBIT C PROPERTY MATERIALS Unchanged EXHIBIT D FORM OF DEED Unchanged EXHIBIT D-1 FORM OF FINGER PARCEL DEED Unchanged EXHIBIT E FORM OF OWNER’S AFFIDAVIT Unchanged EXHIBIT F LEGAL DESCRIPTION OF THE VILLAGE 2 CASINO PROPERTY Unchanged EXHIBIT G PARCEL SPLIT MAP Unchanged EXHIBIT H REVISED LAND USE PLAN Unchanged EXHIBIT I CURRENT MASTER TENTATIVE MAP Unchanged EXHIBIT J LIST OF LITIGATION Unchanged EXHIBIT K FORM OF GENERAL ASSIGNMENT Unchanged EXHIBIT L FORM OF ASSIGNMENT OF PLANS Original Replaced EXHIBIT M FORM OF CONSENT Deleted EXHIBIT N FORM OF RELEASE FROM PLANNED COMMUNITY EXACTIONS Unchanged EXHIBIT O FORM OF NON-FOREIGN AFFIDAVIT Unchanged EXHIBIT P FORM OF SELLER’S REPRESENTATION CERTIFICATE Unchanged EXHIBIT Q PHASE 4 INFRASTRUCTURE DEVELOPMENT OBLIGATIONS NARRATIVE Unchanged EXHIBIT R MASTER DEVELOPER ESTOPPEL CERTIFICATE Unchanged

---

SMRH:4880-9479-5224.22 -17- 101824 39ZR-379857 1614657673.2 SCHEDULE 2.5.2(A) INFRASTRUCTURE BUDGET Unchanged SCHEDULE 2.5.2(B) BUYER INFRASTRUCTURE DEVELOPMENT OBLIGATIONS NARRATIVE Original replaced SCHEDULE 2.5.3 FORM OF CONSTRUCTION LICENSE AGREEMENT New SCHEDULE 2.6 CONSTRUCTION EXACTIONS AND PRO RATA SHARE Unchanged SCHEDULE 4.7(A) FORMS OF VILLAGE 2 ASSOCIATION DOCUMENTS New SCHEDULE 4.7(B) FORM OF DECLARATION ASSIGNMENT New SCHEDULE 4.8 LIST OF CURRENT COMMON AREA PARCELS Unchanged SCHEDULE 4.9.2 FORM OF CASINO RESTRICTIVE COVENANT JOINDER Unchanged SCHEDULE 4.9.3 VILLAGE 2 CASINO PROPERTY OWNER SEWER ALLOCATION Unchanged SCHEDULE 4.10.2(A) FORM OF ASSIGNMENT OF SOUTHERN EASEMENT New SCHEDULE 4.10.2(B) FORM OF ASSIGNMENT OF TEMPORARY DRAINAGE EASEMENT New SCHEDULE 4.10.4 FORM OF UTILITY CORRIDOR EASEMENT New SCHEDULE 6.3 FORM OF VILLAGE DEVELOPER ASSIGNMENT Original replaced SCHEDULE 6.3.1 FORM OF VDA AMENDMENT New SCHEDULE 6.4.2 FORM OF TUSK ASSIGNMENT AGREEMENT New SCHEDULE 6.7.1 FORM OF MONUMENT TRAILHEAD INFRASTRUCTURE DEVELOPMENT AGREEMENT Replaced SCHEDULE 6.7.2(A) FORM OF MONUMENT TRAILHEAD ESCROW AGREEMENT (ENGINEERING AND DESIGN) New SCHEDULE 6.7.2(B) FORM OF MONUMENT TRAILHEAD ESCROW AGREEMENT (CONSTRUCTION) New SCHEDULE 6.8 DEPICTION OF VILLAGE 2 OFFSITE SEWER LINE Unchanged SCHEDULE 6.8(A) FORM OF SEWER LINE ESCROW AGREEMENT JOINDER Unchanged SCHEDULE 6.9.3 PHASE 4 INFRASTRUCTURE HOLDBACK ESCROW AGREEMENT New SMRH:4880-9479-5224.22 -18- 101824 39ZR-379857 1614657673.2 SCHEDULE 6.9.4 FORM OF ASSIGNMENT OF PHASE 4 IDA STEP-IN RIGHTS New SCHEDULE 6.11.5 NVE MPU ASSIGNMENT Unchanged SCHEDULE 6.14 DEPICTION OF EXISTING CITY DRAINAGE EASEMENTS Unchanged SCHEDULE 7 PAYMENT GUARANTY New

---

pacificoaksor3q2024-deed

Exhibit 10.7 Deed of Trust Prepared and signed on April 21, 2024 Between Pacific Oak SOR (BVI) Holdings Ltd. A foreign company from the British Virgin Islands whose registered office in the Virgin Islands is care of: Trident Trust Company (B.V.I.) Limited of Trident Chambers, P.O. Box 146, Road Town, Tortola, British Virgin Islands1 And its address in Israel for the purpose of this Deed of Trust and for the purpose of service of judicial documents is: c/o US Real Estate Representation LTD. 4 Ariel Sharon St., Givatayim Tel: 03-6123939; Fax: 03-6125030 (Hereinafter: the "Company") Of the first part; And Reznik Paz Nevo Trusts Ltd. Of 14 Yad Harutzim Street, Tel Aviv 67778 Tel: 03-6389200 Fax: 03-6289222 (Hereinafter, the "Trustee") Of the second part; 1 Formerly Hauteville Trust (BVI) Limited. 2 1614780295.2 Section Subject Page Deed of Trust 1. Preamble, interpretation, and definitions 5 2. Issuance of the Debentures; Terms of issuance; Pari Passu Debentures 9 3. Acquisition of Debentures by the Company and/or the Partnership and/or the REIT Fund and/or a related person and distribution of dividends 10 4. Issuance of additional Debentures 11 5. The Company's undertakings 15 6. Securing the Debentures 32 7. Early redemption 37 7.1 Early redemption at the discretion of the TASE 37 7.2 Early redemption at the discretion of the Company 38 8. The right to declare the Debentures due and payable 40 9. Claims and proceedings by the Trustee 46 10. Receipts held in Trust 47 11. Power to demand payment to the holders through the Trustee 48 12 Power to withhold distribution of funds 49 13. Notice of distribution 49 14. Failure to pay for reasons out of the Company's control 49 15. Receipt from the Debenture Holders and from the Trustee 51 16. Presentation of a Debenture to the Trustee; Registration with respect to partial payment 51 17. Investment of Funds 52 18. The Company's undertakings to the Trustee 52 19. Additional undertakings 58 20. Agents 58 21. Other Agreements 59 22. Trusteeship reports 59 23. Remuneration of the Trustee and reimbursement of its expenses 60 24. Special powers 60 25. The Trustee's power to engage agents 61 26. Indemnification of the Trustee 61 27. Notices 65 28. Waiver, settlement and alterations to the Deed of Trust 66 29. Register of Debenture Holders 67 30. Release 67 31. Appointment of Trustee; Trustee's Duties; Trustee's Powers; Termination of Trustee's Office 68 32. Meetings of Debenture Holders 70 33. Governing Law 70 34. Exclusive Jurisdiction 70 35. General 70 3 1614780295.2 36. Trustee's Liability 70 37. Addresses 71 38. Magna Authorization 71 Section Subject Page First Schedule Terms Overleaf 1. General 75 2. The Debentures 75 3. Terms of the Debentures (Series D) 75 4. Principal and Interest Payments on the Debentures (Series D) 77 5. Deferral of Dates 77 6. Securing of Debentures 78 7. Nonpayment for a Reason out of the Company's Control 78 8. Register of Debenture Holders 78 9. Splitting of Debenture Certificates 78 10. Transfer of Debentures 78 11. Early Redemption 79 12. Purchase of Debentures by the Company and/or a Related Person 79 13. Waiver, Settlement, and Changes to Deed of Trust 79 14. Meetings of Debenture Holders 79 15. Receipt from Debenture Holders 79 16. Immediate Repayment 79 17. Notices 79 18. Governing Law and Jurisdiction 79 19. Priority 80 Second Schedule Third Schedule Appendix 23 4 1614780295.2 Whereas the Board of Directors of the Company decided to approve the issuance of Debentures (Series D), under the terms of the Shelf Offering Report, as such term is defined in Section 1.5.5 below; And whereas on April 24, 2024 a Deed of Trust between the Company and the Trustee was signed in regard with Debentures (Series D); And whereas on March 24, 2024, S&P Global Ratings Maalot Ltd. (hereinafter: "Maalot") announced the determination of a rating of ilAA- for a new Debentures series to be issued by the Company in the amount of up to ILS 200 million par value; And whereas the Company declares that as of the date of signing this Deed of Trust the Company is in compliance with all the terms of the Rating Agency (as such term is defined in Section 1.5.25 below) for the purpose of assigning the abovementioned rating to the Debentures (Series D); And whereas the Trustee declares that it is a private company limited in shares that was incorporated in Israel pursuant to the Companies Law, 1999, whose main purpose is to engage in Trusteeship activities; And whereas the Trustee has declared that there is no impediment under the Securities Law, 1968, or any other law, to prevent it from entering into this Deed of Trust with the Company and that it complies with the requirements and qualifications stipulated in the Securities Law to serve as trustee for holders of the Debentures (Series D) offered under the Shelf Offering Report; And whereas the Trustee declares that it has no personal interest in the Company and the Company declares that it has no personal interest in the Trustee; And whereas the Company declares that there is no impediment under any law (whether in Israel and/or outside Israel), and/or any agreement to perform issuance of debentures and/or to enter into this Deed of Trust with the Trustee; And whereas the Company has received all the approvals by law and/or any agreement to perform issuance of Debentures (Series D); And whereas the Debentures (Series D) will be listed for trade on the Tel Aviv Stock Exchange Ltd; And whereas the Company has applied to the Trustee to serve as Trustee for the holders of the Debentures (Series D) and the Trustee has agreed to sign this Deed of Trust and to act as the Trustee of the Debenture Holders (as they are defined above), all subject to and in accordance with the terms of this Deed of Trust;

---

5 1614780295.2 Now, therefore, it is agreed, declared and stipulated between the Parties as follows: 6 1614780295.2 1. Preamble, Interpretation, and Definitions 1.1. The preamble to this Deed of Trust, the appendixes and schedules attached hereto constitute an integral part hereof. 1.2. The division of this Deed of Trust into sections as well as the section headings herein is for purposes of convenience and easement of reference only and shall not be used for the purpose of interpretation. 1.3. In this Deed of Trust, where the context so admits, the plural shall include the singular and vice versa, the masculine gender shall implicitly also refer to the feminine gender and vice versa, and any reference in the context to a person shall include a corporate body, all insofar as there is no other explicit. 1.4. With respect to any matter not mentioned in this Deed of Trust and in the event of a conflict between the provision of the Law that cannot be subject to contingency, and this Deed of Trust, the provisions of the Israeli Law that cannot be subject to contingency shall prevail. In any case of a contradiction between the provisions set forth in the Shelf Offering Report with regard to this Deed and/or the Debentures, the provisions of this Deed shall supersede. The Company confirms that as of the date of this Deed, there is no contradiction between the Deed of Trust, the accompanying documents thereof, and the instructions specified in the initial Offering Report in connection with this Deed as well as in connection with the Debentures. 1.5. In this Deed of Trust and in the Debentures, the following terms shall have the meaning set out opposite them, unless otherwise explicitly stated: 1.5.1. "This Deed" or the "Deed of Trust" – this Deed of Trust, with all the amendment that will be inserted from time to time, including the appendices and schedules attached thereto that constitute an integral part thereof; 1.5.2. "Tender" – the tender on the fixed annual interest rate on the Debentures (Series D) to be issued by the Company subject to the First Offering Report; 1.5.3. "The Debentures" or "Debentures (Series D)" or "The Debentures Series" – Debentures (Series D) to be issued by the Company pursuant to the initial Shelf Offering Report, if any, which the terms of them are detailed in this Deed of Trust and in the Debenture Certificate; 1.5.4. "Prospectus" or "Shelf Prospectus" – Company's Shelf Prospectus bearing the date of November 30, 2022, published on November 29, 2022 (Reference Number: 2022-01-144649); 7 1614780295.2 1.5.5. "The Shelf Offering Report" – shelf offering report(s) which will be published pursuant to the shelf-prospectus, in accordance with the provisions of Article 23A (F) of the Securities Law, 1968, in which all the particular details for the debentures offering (Series D) will be completed; 1.5.6. "First Offering Report" – a shelf offering report by virtue of which the Debentures (Series D) will be first issued; 1.5.7. "2023 Report" – the Company's Periodic Report as of December 31, 2023, published on March 31, 2024; 1.5.8. "The Trustee" – Reznik Paz Nevo Trusts Ltd. and/or anyone serving from time to time as Trustee for the Debenture Holders pursuant to this Deed; 1.5.9. "Register of Debenture Holders" and/or "the Register" – the register of Debenture Holders as set forth in Section 29 of this Deed; 1.5.10. "Holder" and/or "Debenture Holder" – as the terms Holder or Warrant Holder are defined in the Securities Law; 1.5.11. "Debenture Certificate" – a debenture certificate the certification and wording of which appears in the First Schedule to this Deed; 1.5.12. "The Law" or "the Securities Law" – The Securities Law, 1968 and the regulations promulgated thereunder, as shall be in effect from time to time; 1.5.13. "The Companies Law" – the Companies Law, 1999 and the regulations promulgated thereunder, as shall be in effect from time to time; 1.5.14. "Business Day" or "Bank Business Day" – Any day on which the TASE Clearing House most of the banks in Israel are open for transactions; 1.5.15. "Trading Day" – a trading day in the TASE; 1.5.16. "Nominee Company" – the nominee company of Mizrahi Tefahot Bank. or a substitute nominee company provided that all the Company's securities will be registered under its name. 1.5.17. "Amount of the Principal" – the nominal value of the outstanding debentures; 1.5.18. "Stock Exchange" – the Tel Aviv Stock Exchange Ltd.; 1.5.19. "Dollar" – United States Dollar (USD); 8 1614780295.2 1.5.20. "Special Resolution" – A resolution adopted at a general meeting of the holders of the Debentures (Series D), at which at least two holders of at least fifty (50%) of the nominal value of the outstanding Debentures (Series D) were present, in person or by proxy, or at an adjourned meeting, at which at least two Debenture Holders were present, in person or by proxy, holding at least twenty percent (20%) of such outstanding balance, and which was adopted (whether at the original meeting or at the adjourned meeting) by a majority of at least two thirds (2/3) of the nominal value of the outstanding Debentures (Series D), which is represented in the vote (except for the addressees). 1.5.21. "Ordinary Resolution" – A resolution adopted at a general meeting of the holders of the Debentures (Series D), at which two holders of at least 25% of the nominal value of the outstanding Debentures (Series D) were present in person or by proxy, or at an adjourned meeting at which all the number of participants attended, and which was adopted (whether at the original meeting or at the adjourned meeting) by a majority of at least fifty percent (50%) of the votes participating in the voting which is represented in the vote (except for the abstentions). It is clarified that in this Deed, unless specified otherwise, the resolution of the meeting of debenture holders shall be accepted as an ordinary resolution. 1.5.22. "Consolidated Circular" – the Circular of the Supervisor of the Capital Market, Insurance and Savings for Institutional Bodies, as may be valid from time to time2; 1.5.23. "Rating" – rating by a rating agency, as it is defined below; 1.5.24. In this Deed of Trust and in the Debentures, the rating shall have the meaning set forth in the table below: "AA" ilAA as rated by Maalot or Aa2 as rated by Midroog or a rating equivalent to these ratings, which will be assigned by another Rating Agency which is rating or will rate the Debentures (Series D). "AA-" ilAA- as rated by Maalot or Aa3 as rated by Midroog or a rating equivalent to these ratings, which will be assigned by another Rating Agency which is rating or will rate the Debentures (Series D). 2 http://mof.gov.il/hon/Information-entities/Pages/Codex.aspx

---

9 1614780295.2 "A+" ilA+ as rated by Maalot or A1 as rated by Midroog or a rating equivalent to these ratings, which will be assigned by another Rating Agency which is rating or will rate the Debentures (Series D). "A" ilA as rated by Maalot or A2 as rated by Midroog or a rating equivalent to these ratings, which will be assigned by another Rating Agency which is rating or will rate the Debentures (Series D). "A-" ilA- as rated by Maalot or A3 as rated by Midroog or a rating equivalent to these ratings, which will be assigned by another Rating Agency which is rating or will rate the Debentures (Series D). "BBB+ " ilBBB+ as rated by Maalot or Baa1 as rated by Midroog or a rating equivalent to these ratings, which will be assigned by another Rating Agency which is rating or will rate the Debentures (Series D). "BBB" ilBBB when rated by Maalot or Baa2 when rated by Midroog or a rating parallel to these ratings, determined by another rating company that rates the Debentures (Series D). "BBB-" ilBBB- as rated by Maalot or Baa3 as rated by Midroog or a rating equivalent to these ratings, which will be assigned by another Rating Agency which is rating or will rate the Debentures (Series D). 1.5.25. "The Rating Agency" – Standard and Poor's Maalot Ltd. (above and below: "Maalot") and/or Midroog Ltd. (above and below: "Midroog"), as applicable, or another Rating Agency, as defined in the Law for the Regulation of the activity of Credit Rating Companies -2014. 1.5.26. "Reporting Corporation" – as it is defined in the Securities Law. 1.5.27. "Reports Regulations" – The Securities Regulations (Periodic and Immediate Reports), 5730-1970. 1.5.28. "Financial Statements" – Annual or quarterly financial statements, audited or reviewed, of the Company which will be published in accordance with Securities Law and the regulations thereunder. 1.5.29. "Company Share Holder" or "Partnership" – Pacific Oak Strategic Opportunity Limited Partnership. A Limited Partnership incorporated in Delaware State and is held under a chain of holdings in full ownership of the REIT, in which there is no controlling shareholder, as specified in Chapter 3 of the Shelf Prospectus. The Partnership directly holds the full (100%) issued and prepaid share capital of the Company. In the Company's opinion, there is no controlling shareholder in the 10 1614780295.2 Company, as such term is defined in the Securities Law. For further details, see Chapter 3 of the Shelf Prospectus. 1.5.30. "REIT Fund" – Pacific Oak Strategy Opportunity REIT, Inc., a corporation that incorporated in the State of Maryland and chose to be classified as a REIT fund (Real Estate Investment Trust) in accordance with the Internal Revenue Code of 1986). As specified in Chapter 3 of the Shelf Prospectus, there is no controlling shareholder in the REIT. 1.5.31. "Exchange Bylaws" – the provisions of the exchange bylaws, guidelines derived from it, and the bylaws of the exchange clearing house (as applies), in the versions as they are from time to time. 1.6. As long as the Debentures are listed for trading in the Stock Exchange, where the Exchange Bylaws apply or will apply to any act pursuant to this Deed of Trust, the dates of the act and the manner of its execution shall be set in accordance with the TASE rules. It is hereby clarified that the execution of the said acts (including in the event of a change to the provisions of the Exchange) shall not derogate from the agreements of the parties, in accordance with this Deed. 1.7. In the event of any conflict between the provisions of this Deed of Trust and the documents attached thereto, the provisions of the Deed of Trust shall prevail. Note that in any case of a contradiction between the provisions set forth in the Shelf Offering Report with regard to the Deed and/or the Debentures, the provisions of this Deed shall supersede, and all subject to the Exchange bylaws and guidelines. The Company confirms and hereby declares that as of the date of this Deed, there is no conflict between the Deed of Trust and its related documents, and the provisions described in the First Offering Report in connection with this Deed, as well as in connection with the Debentures. 1.8. In the event that the debentures issuance is cancelled, for any reason, the validity of this Deed of Trust will expire. 1.9. Any reference made in this Deed to a number of Sections in the Law will be adjusted, mutatis mutandis, to the changes applicable by law, should there be any. 1.10. The actions of the Trustee are valid even if any flaw/defect has been found in its appointment or competence. 1.11. By signing the Deed of Trust, the Trustee is not expressing an opinion concerning the quality of the securities being offered or whether they are a worthwhile investment. 11 1614780295.2 2. Issuance of the Debentures; Terms of Issuance; Pari Passu Debentures 2.1. The Company undertakes that it will issue the Debentures (Series D) as described in the preamble to this Deed, and that the Debentures (Series D), which will be issued within the First Offering Report, will be listed for trade on the TASE, and the Company undertakes that the Debentures (Series D) will be traded during their lifetime on TASE. 2.2. The Company may issue the Debentures (Series D) including the following terms under the Shelf Prospectus, and subject to the publication of a shelf offering report, and at the Company's sole discretion: The Debentures (Series D) (hereinafter: the "Debentures") will be registered by name, assigned a nominal value of ILS 1, and payable in three (3) annual installments due on February 28, 2027, February 28, 2028, and February 28, 2029, such that each of the first two payments constitutes 33% of the total part value of Debentures (Series D) and the third and final payment constitutes 33% of the total part value of Debentures (Series D). The Debentures shall bear a fixed annual (unlinked) interest at a rate to be determined by tender (but subject to adjustments in the event of change in the rating of the Debentures (Series D) and/or non-compliance with the Financial Covenants as set forth in Sections 5.2 and 5.3 below, as well as subject to adjustments due to interest arrears (if any). The interest on the unpaid balance of the principal of the Debentures (Series D) shall be paid twice per year, on August 31 and February 28, in each of the years from 2024 to 2029, starting August 31, 2024, and ending February 28, 2029 (inclusive). Except for the first interest period (as it is defined below), any interest rate payment will be for the six-month period that ended on the day prior to the date of payment (hereinafter: the "Interest Period"). The interest rate payable in respect of a specific interest period (except for the first interest period) (i.e. the period commencing on the date of payment of the previous interest period prior to it and ending on the last day before the date of payment following commencement thereof) shall be calculated as the annual interest rate divided by two. The first interest payment is payable on August 31, 2024 for the period starting on the first trading day after the date of the tender on the Debentures (Series D), and ending August 30, 2024 (hereinafter: the "First Interest Period"), calculated on the basis of 365 days a year and based on the actual days in this period. The final interest payment will be paid on February 28, 2029, upon the final maturity of the Debentures (Series D). Company shall announce the initial, annual and semi-annual interest rates in an immediate report published with the results of the issuance. 12 1614780295.2 The Debentures (Series D) will not be linked (principal and interest) to any linkage basis. 2.3. The Company reserves the right to early redemption of the Debentures provided the terms set forth in Section 7 of this Deed are met. 2.4. The Debentures (Series D) shall rank pari passu among themselves, without any preference or priority of one over the other. 2.5. Undertakings to deposit funds out of the proceeds from the issuance of Debentures (Series D) in a Designated Deposit Account 2.5.1. The Company undertakes that insofar that until the payment date of the principal and interest on Debentures (Series B), which is due on January 31, 2025, the scope of the Net Issuance Proceeds received by the Company from the issuance Debentures (Series D) will exceed NIS 190 million, whether in the initial issuance of Debentures (Series D) or additional issuances of Debentures (Series D) as part of series expansions, then one half of each amount exceeding such 190 million shall be deposited in the Designated Deposit Account. With regard to this Section 2.5: “Net Issuance Proceeds” –issuance proceeds from received by the Company from the issuance Debentures (Series D), whether in the initial issuance of Debentures (Series D) or additional issuances of Debentures (Series D) as part of series expansions, net of offering expenses, commitment to classified investors fee, if any, and the amounts of the Interest Cushions and Expenses Cushions (as defined in section 5.5 below), according to a calculation to be provided to the Trustee by the Company after the issuance coordinator's confirmation of its receipt of the Debentures (Series D) Issuance Proceeds. "Designated Deposit Account" – Designated account of the Company in Israel that the funds deposited therein (as aforesaid) shall be used as described in section 2.5.2 below. Funds deposited in the Designated Deposit Account are allowed to be invested, if invested in bank deposits, treasury bills issued by the Bank of Israel and/or government bonds issued by the Bank of Israel. 2.5.2. The Company undertakes to use the funds deposited in the Designated Account the payment of principal and interest on Debentures (Series B) of the Company which is due on January 31, 2025 and/or for the purpose of buying back Debentures

---

13 1614780295.2 (Series B) of the Company, in accordance with the Company’s sole discretion. It is clarified that following the implementation of the principal and interest payment on Debentures (Series B) of the Company due on January 31, 2025, the Company may use the funds remaining in the Designated Deposit Account , if such remain, according to its exclusive discretion. 2.5.3. No later than 7 business days after the publication of the annual or quarterly financial statements of the Company, as applicable, the Company shall provide the Trustee with a written approval signed by the Company's senior financial officer regarding the amounts deposited in the Designated Deposit Account as well as regarding the use made in said funds in accordance with the foregoing in Section 2.5.1, if such used. It is clarified that following the implementation of the principal and interest payment on Debentures (Series B) of the Company due on January 31, 2025, the Company shall not be required to provide the Trustee with such approval. For the avoidance of doubt it shall be clarified that the Company's undertakings to transfer the funds into the Designated Deposit Account and to use the funds in the Designated account are not secured by any mechanism guaranteeing the execution of said undertaking. The Trustee will relay on the Company’s confirmation in section 2.5.3 above with respect to such undertakings. In the event that the Company does not comply with the said undertakings, the Trustee shall not have the ability to prevent the violation of said undertaking, other than take the actions available thereto by law and according to the Deed of Trust, in order to retroactively enforce the Company to execute its undertakings. With respect to the Company's disclosure undertaking in connection with this section, see Section 5.10 below. 2.5.4. After the payment of principal and interest on Debentures (Series B) of the Company which due on January 31, 2025 is made, the Company will not be required to deposit additional funds in the Designated Account and may use the funds left in the Designated account, if there are such, at its sole discretion. 3. Acquisition of Debentures by the Company and/or the Partnership and/or the REIT Fund and/or a related person and distribution of dividends 14 1614780295.2 3.1. The Company reserves its right, subject to the Law, to acquire the Debentures (Series D) at any time and from time to time, without prejudice to the duty to repay the outstanding Debentures (Series D). In the event of said acquisition, the Company shall notify the Trustee in writing, without derogating from the duty to submit an immediate report applicable thereto. In the event of acquisition by the Company as mentioned above, the acquired Debentures (Series D) will expire immediately, will be cancelled and delisted from trading and the Company may not re-issue these Debentures. In the event that the Debentures (Series D) are acquired by the Company, Company shall apply to the TASE Clearing House to withdraw the Debentures so acquired, and all, unless otherwise determined by the provisions of the law prevailing at the time. Nothing in the foregoing shall derogate from the Company's right to make an early redemption of the Debentures (Series D) as stated in Section 7 below. 3.2. The REIT Fund (directly or indirectly) and/or the Partnership3 (directly or indirectly) and/or a subsidiary of the Company and/or a related company of the Company and/or an associate of the Company and/or a company controlled by one of them (directly or indirectly) (except for the Company itself with respect to which the provisions of Section 3.1 above shall apply) (hereinafter: "Related Entity") may acquire and/or sell Debentures (Series D) at their discretion (and subject to any law), at any time and from time to time, including by means of an issuance by the Company, Debentures (Series D) that will be issued under the Deed of Trust. In the event of acquisition and/or sale as aforesaid by a subsidiary of the Related Entity, the Company shall file an immediate report to that effect. In accordance with the provisions of the law, the Debentures (Series D) that will be held by a Related Entity, as above, shall be deemed an asset of the Related Entity, and if they are listed for trading, they shall not be delisted from the TASE, and shall be transferrable as the other Debentures (Series D). The Debentures (Series D) owned by a Related Entity shall not confer on such Entity voting rights at a meeting of the holders of the Debentures (Series D) and may 3 As stated in Section 1.5.29 above (the Definitions Section), it shall be noted in this respect that the Company's direct Controlling Shareholder is the Partnership which holds 100% of the Company's equity. The Partnership is held in an indirect and final chain of holding by the REIT Fund, which holds 100% (under indirect holding through additional companies) of the Partnership units. As specified in Chapter 3 of the Shelf Prospectus, there is no controlling shareholder in the REIT. In the Company's opinion, there is no controlling interest in the Company, as the term is defined in the Securities Law. For further details, see Chapter 3 of the Shelf Prospectus. 15 1614780295.2 not be counted for purposes of determining the existence of a quorum at such meetings. The meetings of the holders will be conducted in accordance with the Second Schedule to the Deed of the Trust. A Related Entity will report to the Company, in as much as it is obligated by law to do so, on the acquisition of the Debentures (Series D). Regarding the obligation of the Company to provide the Trustee with certifications in connection with this section, see Section 18.21 below. 3.3. Nothing in the foregoing section shall bind the Company and/or a Related Entity or the holders of the Debentures (Series D) to acquire Debentures and/or sell the Debentures (Series D) in their possession. 3.4. As of the date of signing this Deed, the Company is not subject to any restriction with respect to the distribution of dividends or the buyback of its shares, except as specified in Section 5.9 below and in Section 5.9 of Company's Series B bonds and Series C bonds Deed of Trust4. 4. Issuance of additional Debentures 4.1. Subject to receipt of approval from TASE for the listing for trading, the Company may, from time to time, without requiring the approval of the Trustee and/or the Holders existing at that time, to issue additional Debentures (Series D) (whether by way of a private placement, or under a shelf offering report, or in any other way), including to a Related Entity (as it is defined in Section 3.2 above), on such terms as it sees fit (the terms of the additional issued Debentures shall be identical to the terms of the outstanding Debentures (Series D)) in circulation, (hereinafter: "Expansion of the Series"). However, in this case, the Trustee shall have the right to request an increase in the annual fees pro-rata to the expansion of the debenture series, and pursuant and subject to the contents of Section 1.1 of Appendix 23 to the Deed of Trust, in the manner set out until the end of the Trust period, and the Company gives its consent, in advance, by signing on this Deed to the increase of the Trustee fees, as mentioned above. The outstanding Debentures (Series D) on the date of Expansion of the Series and the additional Debentures (Series D) (from the date of issuance thereof) shall constitute one series for all intents and purposes, and the Deed of Trust for Debentures (Series D) shall also apply to each such additional Debentures (Series D). The Company shall apply to the TASE to list the additional Debentures (Series D) for trading as aforesaid, once they are issued. 4 Signed between the Company and the Trustee of Company's Debentures (Series C) on February 12, 2020. 16 1614780295.2 4.2. Notwithstanding the aforesaid, the Expansion of the Series shall be carried out, provided all the terms set forth below are fulfilled: (a) the said Expansion of the Series does not adversely affect the rating of the Debentures (Series D), as it shall be at that time (namely, the rating preceding the Expansion of the Series); In this respect, it is clarified that so long as Debentures (Series D) are rated by more than one rating agency, then the review of the rating for this section shall be carried out at any time, according to the higher rate; (b) in accordance with the latest financial statements published prior to the date of the Expansion of the Series, the Company is in compliance with all the financial covenants set forth in Section 6.3 of this Deed and this is without taking into consideration the cure and waiting periods listed in Section 8.1 below; (c) on the Date of the Expansion of the Series, in accordance with the latest financial statements published prior to the expansion, and after prior consideration of the said expansion, the Company will be in compliance with all of the financial covenants as forth in the above Subsection (b) following Expansion of the Series, and this without factoring in the remedy and waiting periods set forth in the below Section 8.1; (d) the Company has not violated any of its material undertakings to the holders of the Debentures (Series D), there is no cause for immediate repayment, as detailed in Section 8.1 below, and there is concern that such cause will exist, without factoring in the remedy and waiting periods set forth in the below Section 8.1; (e) the Expansion of the Series does not impair the ability of the Company to repay the Debentures (Series D); and (f) the series amount (the outstanding principal balance) shall not exceed a total amount of ILS 900 million par value of Debentures (Series D). 4.3. The Company will submit to the Trustee, at least three business days before making a tender for early commitments from classified investors (as the Company may choose to hold said tender in its sole discretion), and in any case at least three business days before the actual Expansion of the Series, written certification signed by the chief financial officer of the Company, worded to satisfaction of the Trustee, on (1) the fulfillment of their terms specified in Section 4.2, together with the relevant calculations on its compliance with the said provisions which are detailed in Subsections (b) through (c) above; and (2) confirmation that such an expansion would not impair the holders of Debentures (Series D) and that the Board of Directors of the Company has examined the effect of the aforesaid Expansion of the Series and the ability of the Company to meet its obligations to the holders of the Debentures (Series D) prior to performing the series expansion, and concluded that there is no concern that it shall be impaired. In any event of an Expansion of the Series, the Expansion of the Series will be subject to receipt of prior

---

17 1614780295.2 certification from the Rating Agency that the Expansion of the Series will not affect the rating of the Debentures (Series D) in effect at that time. The certification of the Rating Agency will be published by the Company prior to the Expansion of the Series. In addition, the Company shall publish an immediate report, prior to the series expansion stating whether the series expansion meets (or does not meet, as the case may be) the aforesaid terms. 4.4. This right of the Company does not exempt the Trustee from examining the said issuance, to the extent that such duty is imposed on the Trustee by law, and does not derogate from the rights of the Trustee and the Debenture Holders pursuant to this Deed, including their right to declare the Debentures due and payable as stated in Section 8 below. 4.5. The Debentures (Series D), including those that will be issued as part such an aforementioned expansion of the Series, shall rank pari passu among themselves, with respect to the Company's obligations pursuant to the Debentures, without any preference or priority of one over the other. 4.6. If the discount rate set for the additional Debentures (Series D), if any, differs from the discount rate of the outstanding Debentures (Series D) at that time (including lack of discount, if relevant), the Company shall apply to the tax authority, prior to the expansion of the series, in order to obtain its approval that, for purposes of deducting withholding tax from the discount fees in respect of the Debentures (Series D), a uniform discount rate be determined for the Debentures (Series D) based on a formula that weighs the different discount rates in the series, if any (hereinafter – the "Weighted Discount Rate"). 4.7. In the event that such approval is obtained, the Company will calculate the Weighted Discount Rate in respect of all the Debentures (Series D), before the series expansion, and will publish an immediate report on the results of the issuance the uniform Weighted Discount Rate for the entire series, prior to the Expansion of the Series, and tax will be deducted on the dates of repayment of the Debentures (Series D), according to the Weighted Discount Rate and in accordance with the provisions of the law. In such a case, all other provisions of the law relating to the taxation of discount fees shall apply. If such approval is not obtained, the Company will publish an immediate report, immediately prior to the issuance of the additional Debentures (Series D) as part of said series expansion, regarding the failure to obtain such approval and stating the highest discount rate in respect of that series. Withholding tax will be deducted upon the repayment of the Debentures (Series D), in line with the discount rate reported as aforesaid. 18 1614780295.2 4.8. Therefore, there may be cases where tax would be withheld due to discount rate at a rate higher than the discount rate set for the holders of Debentures (Series D) before the Expansion of the Series (hereinafter: "Excess Discount Fees"), and this will affect them unfavorably whether or not the tax authority approved a uniform discount rate for the Debenture (Series D). In this case, an assessee that held Debentures (Series D) prior to the aforesaid Expansion of the Series, up to the redemption of these Debentures (Series D), will be entitled to file a tax report with the tax authority and receive a tax return in the amount of the tax that was deducted from the Excess Discount Fees, provided he is entitled to such return under the law. 4.9. The Company may issue at any time, whether by way of a public issuance under a prospectus, or by any other way, and without requiring the approval of the Trustee and/or the debenture holders, other debenture series beyond the Debenture series and/or other debt-type securities (hereinafter: the "Other Series" or the "Other Issuance"), including to a Related Entity (as it is defined in Section 3.2 above), under repayment terms, interest, linkage, repayment rate in case of dissolution and other terms, as the Company sees fit, and whether they are superior to the terms of Debentures (Series D), equal to them, or fall short of them. Despite the abovementioned, in the event that the Company will issue other series not secured by any collateral, said other non-secured series shall not have priority over the Debentures (Series D) in the event of dissolution process involving the Company. In addition, if the Company issues additional series secured by collateral, the Company shall not state in the relevant Deed of Trust or the terms of other such securities that these debenture series have priority over the Debentures (Series D), except in the matter of assets which are secured by liens, and will deliver to the Trustee certification to that effect, as mentioned above, mutatis mutandis, prior to executing the issuance of the other series. 4.10. Notwithstanding the abovementioned, the Other Issuance shall be subject to the authorization of the Exchange for listing for trading and the fulfillment of all of the following terms: (a) The Other Issuance shall not impair the rating of Debentures (Series D), as such rating shall be on that date (i.e., the rating on the eve of the Other Issuance); for the purpose of this section is shall be clarified that if the Debentures (Series D) shall be rated by more than one rating company, the examination of the rating for this section shall be done at any time, according to the higher rating of those rated; (b) according to the most recently published financial statements prior to the date of the Other Issuance, as of the date of the Other Issuance, the Company is in compliance with the Financial Covenants detailed in Section 6.3 of this Deed, without taking into 19 1614780295.2 account the remedy period and the waiting period listed in Section 8.1 below; (c) Upon the Other Issuance, in accordance with its most recently published financial statements prior to the date of the Other Issuance, and upon the retroactive consideration of the Other Issuance, Company is in compliance with all of its financial covenants as set forth in Section 6.3 to this Deed, and this excluding the remedy and waiting periods set forth in the below Section 8.1; (d) Company is not in violation of any of its material undertakings towards holders of Debentures (Series D), and no grounds have materialized for immediate repayment, as specified in Section 8.1 below, and this excluding the remedy and waiting periods set forth in the below Section 8.1; and (e) The Other Issuance shall not jeopardize the Company's ability to repay the Debentures (Series D). Prior to any issuance of Other Series, the Company shall provide the following certificates and publish the following: A. The Company shall provide the Trustee with a written certificate signed by the Company's senior financial officer in regard to the fulfillment of all the terms listed above in Section 4.10, including a relevant calculation regarding the terms set forth in the above Subsections (b) and (c), no later than 4 days prior to the execution of the Other Issuance, as well as a confirmation that the Other Issuance is not preferable to the terms of Debentures (Series D) in dissolution, as specified in Section 4.9 above, and all using a version that is satisfactory to the Trustee. B. Company shall publish a confirmation from any rating firms rating the Company's debentures, as they are at the time, according to which such Other Issuance shall not damage the rating of Debentures (Series D) issued first according to this Deed, as such rating shall be on that date. Without derogating the aforementioned, the said rights of the Company shall not diminish the Trustee's right to examine the consequences of the Other Issuance, and shall not damage the rights of the Trustee and/or the Debentures Holders according to this Deed, including their right to call for immediate repayment of Debentures (Series D) as aforesaid in Section 8 above. Subject to the provisions of any law, the Company shall inform the Trustee of such Other Issuance a reasonable time before the issuance and shall provide the Trustee with any report it published in connection therewith pursuant to any law. 5. The Company's undertakings 20 1614780295.2 5.1. The Company hereby undertakes to pay, on the dates for payment specified in the Deed of Trust, all the principal and interest amounts (including arrears interest, if any, and additional interest in respect of a rating change and/or in respect of a breach of financial covenants, if applicable) payable under the terms of the Debentures (Series D), and to comply with all the other terms and obligations imposed on it, pursuant to the terms of the Debentures (Series D) and under the terms of this Deed. 5.2. Adjustment of the interest rate due to changes in the rating of Debentures (Series D): For the purpose of this section below it is clarified that in the event that the Debentures (Series D) are rated by more than one Rating Agency, the examination of the rating for the purpose of adjusting the interest rate for the change in rating (if any) will be made, at all times, in accordance with the lower rating. The interest rate to be borne by the Debentures (Series D) shall be adjusted in respect of change in the rating of the Debentures (Series D), as specified below in this section: It should be clarified that if and to the extent that an adjustment of interest is required in accordance with the mechanism specified in this section above and in accordance with the mechanism specified in Section 5.3 below, then, in each event the maximum additional interest rate shall not exceed 1.5% above the interest rate which will be determined in the Tender (hereinafter: "The Total Maximum Additional Interest Rate"). Arrears interest (if any), in accordance with Section 4 (A) of the Terms Overleaf, shall be added to the abovementioned rate and will not constitute part of it. Pursuant to this Section 5.2: The ratings as such are defined in the table in Section 1.5.24 above. "Base rating": Rating of ilAA. For the avoidance of any doubt, it is clarified that the Base Rating is the rating given to the Company's Debentures (Series D) by the Rating Agency on the date of the Debentures (Series D) Issuance. "The Additional Interest Rate": an additional interest granted to the Debenture holders at a rate of 0.25% per annum for a downgrade of one notch below the Base Rating up to a maximum additional interest of 1.25% per annum for a downgrade of 5 notches or more (hereinafter: "Maximum Additional Interest Rate Due to a Rating Downgrade"). A. If the rating of the Debentures (Series D) be revised by the Rating Agency (in the event of the replacement of a Rating Agency, the

---

21 1614780295.2 Company will provide the Trustee with a comparison between the rating scale of the Rating Agency being replaced and the rating scale of the new Rating Agency) during any interest period whatsoever, such that the rating determined for the Debentures (Series D) shall be one notch lower or more from the Base Rating, (hereinafter in this current Section 5.2: the "Downgraded Rating"), the annual interest rate to be borne by the balance of the unpaid principal of the Debentures (Series D) shall be increased by the additional interest rate or part thereof (as mentioned above) in accordance with the notches set forth above, and this in respect of the period commencing from the date of publication of the new rating by the new Rating Agency until the full repayment of the balance of the outstanding principal of the Debentures (Series D) or until the date of the upgraded rating in accordance with Section 5.2(E) below. If the interest rate was raised previously in respect of deviations from the aforesaid financial covenants in Section 5.3 below, then the increase in the interest rate in respect of the aforesaid rating downgrade shall be limited such that the overall additional annual interest (except in the event that there is entitlement to arrears) shall in no event exceed the Total Maximum Additional Interest Rate. B. No later than one business day, from receipt of the notice of the Rating Agency with respect to the downgrading of the rating of the Debentures (Series D) to the downgraded rating as such is specified in Subsection A above, the Company shall publish an Immediate Report, in which the Company shall specify: (a) the downgrading of the rating, the downgraded rating, the rating report and the date of the start of the downgraded rating of the Debentures (Series D) (hereinafter in this current Section 5.2: the "Date of the Rating Downgrade"); (b) the compliance/non-compliance thereof with the financial covenants specified in Section 5.3 below, in accordance with the latest reviewed or audited consolidated financial statement published prior to the date of the Immediate Report, and whether there has been a change in the interest in respect of the compliance/non-compliance thereof with the aforesaid financial covenants; (c) the exact interest rate to be borne by the principal balance of the Debentures (Series D) for the period from the start of the current interest period up to the Date of the Rating Downgrade (the interest rate will be calculated based on the number of days in this period in relative to 365 days a year) (hereinafter in this current Section 5.2: the "Original Interest"); (d) the interest rate to be borne by the principal balance of the Debentures (Series D) starting from Date of the Rating Downgrade up to the date of the actual 22 1614780295.2 payment of the next interest payment, namely, the Original Interest plus the additional interest rate per annum (the interest rate will be calculated based on the number of days in this period in relative to 365 days per year) (hereinafter in this current Section 5.2: the "Amended Interest"), if the interest rate was not raised previously, if raised at all, in respect of deviations, if any, from the aforesaid financial covenants in Section 5.3 below, then the increase in the interest rate with respect to the aforesaid downgrade shall be limited such that the overall additional annual interest (except if entitlement to interest on arrears is established) with respect to a decline in rating and failure to comply with the financial covenants will not exceed the Total Maximum Additional Interest Rate; (e) the weighted interest rate to be paid by the Company to the holders of the Debentures (Series D) on the next interest payment date, deriving from the provisions of Subsections (C) and (D) above ; (f) the annual interest rate reflected in the weighted interest rate; (g) the annual interest rate and the semiannual interest rate (the semiannual interest rate shall be calculated as the annual interest divided by divided by two) for the forthcoming periods. C. If the date of the start of the downgraded rating of the Debentures (Series D) falls during the four trading days prior to the effective date for any interest payment and the termination thereof is on the date of the next interest payment and this effective date (hereinafter in this current Section 5.2: the "Deferral Period"), Company shall pay holders of the Debentures (Series D) on the date of the next interest payment, the Original Interest rate, prior to the change only, wherein, if the interest rate was not raised previously in respect of deviations from the aforesaid financial covenants in Section 5.3 below, while the rate of interest derived from the additional interest at a rate equal to the additional interest rate for a year during the Deferral Period, will be paid at the next interest payment date. The Company will announce in the Immediate Report detailed in the above Subsection B the exact interest rate payable on the next interest payment date as well as the annual and semiannual interest rates for subsequent interest periods. D. In the event of an amendment of the rating of the Debentures (Series D) by the Rating Agency such that it affects the interest rate to be borne by the Debentures (Series D) specified in Section 5.2 (A) above, or 5.2 (E) above, the Company will advise the Trustee of such in writing within one business day from the date of publication of the aforesaid Immediate Report. 23 1614780295.2 E. In the event that following the downgrading of the rating such that it affects the interest rate to be borne by the Debentures (Series D) specified in 5.2 (A) above, the Rating Agency will update the rating of the Debentures (Series D) with an upgraded rating and if the interest rate has not been increased previously with respect to deviations from the aforesaid financial covenants in Section 5.3 below, the interest rate will be reduced by notches of 0.25% per annum for each notch up to the Base Rating. If the Rating Agency upgrades the rating for the Debentures (Series D) to a rating which is equal to or higher than the Base Rating (hereinafter in this current Section 5.2: the "High Rating"), and if the interest rate was not raised previously due to deviation with respect to the aforesaid financial covenants in Section 5.3 below, then the rate of interest to be paid by the Company to the holders of the Debentures (Series D) shall be decrease, on the date of the relevant payment of the interest, in respect of the period in which the Debentures (Series D) were rated with a High Rating only, such that the interest rate to be borne by the outstanding balance of the principal of the Debentures (Series D) will be the (partially) added interest rate or the interest rate which the Company will publish in an Immediate Report with regard to the results of the issuance, without any addition in respect of the downgrading specified in this Section 5.2 (and in any event, the interest to be borne by the Debentures will not be less than the interest rate which will be determined in the Tender), as applicable. In such a case, the Company shall act in accordance with the provisions of Subsections (B) to (D) above, mutatis mutandis, deriving from the High Rating instead of the Downgraded Rating. It is clarified that the adjustment of the interest rate in respect of a change in the rating or as a result of non-compliance with financial covenants will be examined separately, without the one affecting the other, subject to the effect that the maximum accumulated interest in respect of the downgrading and in respect of non-compliance with financial covenants shall not exceed the Total Maximum Additional Interest Rate (as such term is defined at the beginning of this section 5.2). The additional interest for non-compliance, if there was such non-compliance, in accordance with Section 5.3 below, shall continue to apply even in the event of an upgrade in rating. It is clarified that arrears interest, if any, shall be added to the interest rates stated above. It is further clarified that should the rating of the debentures exceeds the Base Rating, it shall have no effect on the interest carried by the debentures as of said date. 24 1614780295.2 F. If the Debentures (Series D) shall cease to be rated for a reason dependent on the Company (for example, but not only, due to non- compliance with the undertakings of the Company to the Rating Agency, including due to the non-payment of payments and/or reports which the Company has undertaken to provide to the Rating Agency) for a period exceeding 21 days prior to the final repayment thereof, a suspension of the rating will be considered a downgrading of the rating of the Debentures (Series D) in a manner by which the annual interest rate borne by the remaining outstanding principal balance of Debentures (Series D) shall be increased by 1.25% as of the date in which the rating no longer applies, subject to the Total Maximum Additional Interest Rate and the provisions of Subsections (B) - (E) shall apply accordingly and the matter shall not derogate from the rights of Debentures Holders to call the Debentures for immediate repayment, as set forth in the below Section 8.1.21. For the avoidance of doubt, it is clarified that if the Debentures (Series D) cease to be rated prior to the final payment thereof, for a reason not dependent on the Company, this shall not affect the aforesaid interest rate in Subsection (A) above and the provisions of this Section 5.2 shall not apply. G. In the event that the Rating Agency will be replaced (even in the event where there is more than one Rating Agency) or that the Debentures (Series D) cease to be rated by the Rating Agency (even if the case of more than one rating company), the Company shall publish and Immediate Report, within one trading day from the date of the change, in which the Company shall inform of the circumstances of replacing the rating agency or suspending the rating, respectively. For the avoidance of doubt, it is clarified that: (1) a change in the rating outlook of the Debentures (Series D) or the addition of Debentures (Series D) to a watchlist, or any similar action on the part of the rating agency shall not entail a change in the interest rate on the Debentures (Series D) as stated in this section above; (2) as long as the Debentures (Series D) are rated by two Rating Agencies, Subsection (F) above will not apply unless the two rating companies cease to rate the Debentures (Series D). H. In the event of downgrading, the Company shall act in accordance with Sections 5.2 (A) - (C) above. If before the date of rate downgrading, there has been an increase in the interest rate in respect of a deviation from one or more than one financial covenant, based on the mechanism specified in Section 5.3 below, the change applicable to the interest rate in respect of the adjustment

---

25 1614780295.2 mechanism specified in this Section 5.2 will be restricted so that in any case the increase in the interest rate (if there is such increase) will not in the aggregate exceed the Total Maximum Additional Interest Rate. Arrears interest, if applicable, will be added to the abovementioned interest. I. The Company undertakes to act, in as much as it is under its control, so that the Debentures (Series D) will be rated by a Rating Agency for the entire term of the Debentures (Series D) and for this purpose the Company undertakes to pay the Rating Agency the payments it has undertaken to pay the Rating Agency and to provide the Rating Agency with reasonable reports and information required thereby as part of the agreement between the Company and the Rating Agency. For this purpose, non-implementation of the payments the Company has undertaken to pay the Rating Agency and non-provision of the reports and information required by the Rating Agency as part of the agreement between the Company and the Rating Agency will be regarded as causes and circumstances which are under the control of the Company. The Company does not undertake not to replace the Rating Agency or not to terminate the agreement therewith during the period of the Debentures (Series D). In the event that the Company will replace the Rating Agency which at the time of the replacement is the sole Rating Agency rating the Debentures (Series D) and/or ceases the work of the Rating Agency (if it is not the sole Rating Agency), the Company undertakes that it shall notify the Trustee and the holders of Debentures of such within one trading day and shall state in its announcement the reasons for replacing the Rating Agency, and all of this no later than one trading day from the date of the said replacement and/or the date of the decision to cease the work of the rating agency, whichever is earlier. It should be clarified that the foregoing does not derogate from the right of the Company to replace the Rating Agency at any time or cease the work of the Rating Agency (if it is not the sole Rating Agency), at its sole discretion and for any reason it deems necessary. 5.3. Interest rate adjustment as a result of failure to comply with a Financial Covenant: The interest rate on the Debentures (Series D) will be adjusted due to one breach or more than one of the Financial Covenants as set forth below: 26 1614780295.2 1. The Consolidated Equity Capital of the Company (as this term is defined in Section 6.3 (1) below) (excluding minority rights) shall not be less than USD 550 million; 2. The Net Adjusted Financial Debt to net CAP (as these terms are defined in Section 6.3 (2) below) shall not exceed 70%; 3. Adjusted NOI (as the term is defined in Section 6.3(3) below) shall total no less than USD 40 million. The financial covenants set forth in Subsections 1 to 3 above shall be referred to in this Section 5.3 above and below only collectively as the "Financial Covenants" and each of the aforementioned financial covenants shall be named: "the Financial Covenant". It is hereby clarified that if an adjustment of the interest rate is required in accordance with the mechanism described in this section above, and also in accordance with the mechanism specified in Section 5.2 above, then, in any case, the maximum additional interest rate will not be more than 1.5% above the interest rate determined in the Tender (hereinafter: "The Total Maximum Additional Interest Rate"). Arrears interest, if applicable pursuant to Section 4(a) of the terms overleaf, will be added to the abovementioned interest and will not constitute part of it. "The Additional Interest Rate" – addition of interest in the rate of 0.5% for each breach of a financial covenant, separately, and an increase in the accumulated interest of up to 1.5%; the interest rate will only be raised once due to the breach of any of the financial covenant, if any, and the interest rate will not be raised again if a breach of the same financial covenant continues. It is emphasized that in the event of downgrading the rating of the Debentures the annual interest rate has been raised pursuant to Section 5.2 above, then, in any case, the additional interest rate by virtue of that section, together with the additional interest rate by virtue of this Section 5.3, for breach of the financial covenants shall not exceed the Total Maximum Additional Interest Rate. "The Breach Date" – the date of publication of the financial statements that point to the breach. A. If the Company breaches any of the financial covenants pursuant to the latest published audited and reviewed financial reports of the Company (hereinafter in this current Section 5.3: "the Breach"), the annual interest on the outstanding principal amount of the Debentures (Series D) will increase by the Additional Interest Rate in respect of the Breach, above the interest rate in effect at the time, prior to the change, in respect of the period from the date of the 27 1614780295.2 Breach until the date of repayment of the outstanding principal amount of the Debentures (Series D) or until the date of publication of the Company's financial statements pursuant to which the Company is in compliance with that financial covenant, whichever is earlier. If the interest rate was increased before that due to a rating downgrade due to as stated in Section 5.2 above, then the interest rate increase due to the breach of a financial covenant as provided in this subsection, will be limited so that the total annual additional interest (except when there is entitlement to arrears) due to the rating downgrade and breach of financial covenants will not exceed the Total Maximum Additional Interest Rate in any case. B. In the event of said breach, no later than one business day from the publication of the Company's audited or reviewed financial statements (as applicable), the Company shall publish an immediate report stating the following: (a) failure to comply with the said undertaking and detailing the financial covenants on the date of publication of the financial statements; (b) the current rating of the Debentures (Series D) based on the last rating report that was published prior to the immediate report and whether the interest was adjusted, as per Section 5.2 above; (c) the accurate interest rate on the Debentures (Series D) for the period from the current interest rate period until the Date of the Breach (the interest will be calculated based on 365 days a year) (hereinafter in this current Section 5.3: the "Original Interest Rate"), respectively); (d) the interest rate on the outstanding Debentures (Series D) from the Date of the Breach until the date of the nearest interest payment, that is, the Original Interest Rate plus the Additional Interest Rate per year (the interest rate will be calculated based on 365 days a year) (hereinafter in this current Section 5.3: the "Current Interest Rate"). If the interest rate was increased before that due to a rating downgrade as stated in Section 5.2 above, then the increase to the interest rate at the subject of this current Subsection shall be limited so that the total annual interest rate increase (excluding entitlement for interest arrears) in no case exceeds the Total Maximum Additional Interest Rate; (e) the weighted interest rate payable by the Company to the holders of the Debentures (Series D) on the nearest interest payment date, which arises from the provisions of Subsection (c) and (d) above; (f) the annual interest rate arising from the weighted interest rate; (g) the annual interest rate and the semi- annual interest rate (the semi-annual interest rate will be calculated as the annual interest rate divided two) for the upcoming periods. 28 1614780295.2 C. If the Date of the Breach occurs during the period commencing four trading days prior to the record date for the payment of any interest and ending on the interest payment date that is nearest to the record date (hereinafter in this subsection: the "Deferral Period"), the Company shall pay the holders of the Debentures (Series D), on the nearest interest payment date, the Original Interest Rate (prior to the change) only, while the interest rate resulting from an increase at a rate equal to the Additional Interest Rate per year during the Deferral Period, will be paid on the next interest payment. The Company shall announce in the immediate report detailed in the above Subsection B the stating the accurate interest rate payable on the next interest payment date as well as the annual and semiannual interest rates pertaining to subsequent interest periods. D. In the event of a breach of a Financial Covenant which affects the interest rate on the Debentures (Series D) as stated above in Section 5.3(A) above or in Section 5.3(E) below, the Company shall notify the Trustee in writing within one business day from the date of publication of the financial statements, as aforesaid. For the avoidance of doubt, it is clarified that if after the breach, the Company will publish its audited or reviewed financial statements (as applicable), pursuant to which the Company will be in compliance with that financial covenant, then the interest rate paid by the Company to the holders of the Debentures (Series D), on the relevant interest payment date, will decrease, in respect of the period commencing on the date of publication of the financial statements that point to its compliance with that financial covenant, so that the interest rate on the outstanding principal amount of the Debentures (Series D), provided the interest rate was not raised before that due to a rating downgrade of Debentures (Series D) as stated in Section 5.2 above, and/or due to breach of another financial covenant, will be the interest rate that shall be determined in the tender or another interest rate determined due to a downgrade in the rating of Debentures (Series D) as stated in Section 5.2 above, and/or due to breach of another financial covenant (and in any case, the interest rate on the Debentures will not be lower than the interest rate that will be determined in the Tender). In such case, the Company shall act in accordance with Subsections (B) to (D) above, mutatis mutandis, as the case may be, arising from the Company's compliance with that financial covenant. It is clarified that the adjustment of the interest rate due to a change in the rating or due to breach of financial covenants will be examined separately without the one affecting the other,

---

29 1614780295.2 subject to the effect that the maximum accumulated interest in respect of the downgrading and in respect of non-compliance with financial covenants shall not exceed the Total Maximum Additional Interest Rate. The additional interest for non- compliance, if there was such non-compliance, in accordance with Section 5.3 below, shall continue to apply even in the event of an upgrade in rating. It is clarified that arrears interest, if any, shall be added to the interest rates stated above. E. The examination as to whether the Company is in compliance with the financial covenants will be conducted on the date of publication of the Company's financial statements and as long as the Debentures (Series D) are outstanding, in relation to the quarterly/annual financial statements which the Company published until that date. With respect to the undertaking of the Company for disclosure in connection with this section, see Section 5.10 below. 5.4. For the avoidance of any doubt it is clarified that, subject to the aforesaid, the incremental interest rate payments arising from the rating downgrade as stated in Sections 5.2 above and/or as a result of the Company's failure to comply with the Financial Covenants as stated in Section 5.3 above are cumulative. Therefore, in the event of a rating downgrade and a breach of any of the financial covenants by the Company, the holders of the Debentures (Series D) will be entitled to an additional interest as aforesaid provided the annual interest rate increase due to rate downgrade and breach of financial covenants does not exceed the Total Maximum Additional Interest Rate. It is further clarified that the arrears interest, if any, will be added to the interest rates stated above. The Company undertakes that, in as much as it is within its power, it shall not carry out any actions that are likely to lead to disqualifying the REIT Fund as a real estate investment fund, as per the Internal Revenue Code of 1986. 5.5. Expenses Cushion and Interest Cushion: 5.5.1. Interest Cushion A. The Company shall transfer an amount equal to the semi- annual interest amount that is expected to be paid to the holders of Debentures (Series D) (hereinafter in this section: "First Interest Cushion Amount") to the Trustee by transfer of the First Interest Cushion Amount from an account in the name of the lead manager, in which the proceeds of the issuance shall be kept in the Interest Cushion Account, as such term is defined below. 30 1614780295.2 B. "Interest Cushion Account": an account to be opened by the Trustee in their name in trust for holders of Debentures (Series D) with a financial institution. The signatory rights in the Interest Cushion Account shall be assigned solely to the Trustee. All expenses of opening, managing, and closing the Interest Cushion Account shall apply to the Company. All the rights of the Company in the Interest Cushion Account (if such exist), including all the funds and/or deposits and/or securities, including the fruit accrued thereon, as such shall be from time to time, shall be pledged by the Company by a single fixed first-rank pledge not restricted by amount in favor of the Trustee. In accordance with the attorney specializing in the British Virgin Islands law, the pledge of the Trust Account shall be subject to Israeli law and will be registered in the pledges registries in the British Virgin Islands (the internal registry of pledges of the Company as well as the public registry of pledges managed in the British Virgin Islands), and the Company shall provide the Trustee with an opinion by an attorney specializing in the British Virgin Islands law regarding the legality and validity of the pledge and the enforceability thereof. C. Without derogating from the foregoing in this subsection above, the Trustee shall invest the funds in the Interest Cushion Account in accordance with the provision of in Section 17 of the Deed of Trust. D. On the 2nd day of each calendar month after the payment date of any interest, and in the event that said day is not a business day then on the following business day (hereinafter: "Cushion Completion Date"), if the amount deposited in the Cushion Interest Account is lower than the near payment of interest, the Company shall transfer to the Cushion Interest Account an amount equal to the amount required for the purpose of equalizing the amount deposited in the Cushion Interest, as of the Cushion Completion Date (hereinafter: "Current Cushion Amount"), within 4 business days from the Cushion Completion Date. E. If on the Cushion Completion Date the amount deposited in the Interest Cushion Account is higher than the Current 31 1614780295.2 Cushion Amount, as the Current Cushion Amount shall be at that time (hereinafter: the "Excess Amount"), the Company shall be entitled to request the Trustee to make use of the Excess Amount for the purpose of repayment of the Debentures interest and/or principal as part of any payment date (and to the extent that the repayment amount of the interest and/or principal shall be higher than the excess amount, after the Company has presented a reference regarding the transfer of the remaining amount to the Nominee Company). Furthermore, in an event of early redemption of the Debenture (Series D), including by way of exchange tender offer for the Debenture (Series D), the Company shall be entitled to request that the Excess Amount be released to it, and the Trustee will transfer the Excess Amount to the account specified by the Company. F. The Company shall provide the Trustee, immediately after the initial issuance of the Debentures, as well as on any interest completion date, with a calculation signed by the Company's senior financial officer with regard to the Current Cushion Amount as of said date. G. It is clarified that in the event the Debenture (Series D) is extended in the future, the Company shall deliver to the Cushion Interest Account, as a condition for and prior to transferring the proceeds of the extension to the Company, an amount equal to the required amount for completing the Current Cushion Amount after the date of such series expansion. H. It is clarified that if eligibility for the additional interest rate, as defined in Sections 5.2 and 5.3 above, is applicable, the Company shall deposit in the Cushion Interest Account an amount equal to the required amount for completing the Current Cushion Amount after the interest rate change as aforementioned, within 14 business days of the date of publishing an immediate report about such change in the interest rate. I. It is clarified that failure to deposit funds in the Cushion Interest Account within 14 business days of the relevant date, shall constitute a cause to call for immediate repayment of the balance of Debentures (Series D) in circulation as. 32 1614780295.2 J. To dispel any doubt it is clarified that the undertaking of the Company to transfer the funds to the Cushion Interest Account shall not be secured by a mechanism that will assure performance of this undertaking. In the event that the Company fails to meet its undertaking to transfer the funds to the Cushion Interest Account, the Trustee shall not have the ability to prevent this violation but shall rather take all measures granted to them by law and in accordance with the Deed of Trust, to retroactively enforce on the Company the performance of its undertaking. K. On the final payment date of the Debentures (Series D), all funds that are kept in the Cushion Interest Account, except for the Expense Cushion as defined in Section 5.5.2 below (after deduction of expenses and fees) shall be transferred by the Trustee directly to the Nominee Company for the purpose of the said final repayment, subject to obtaining the advance approval of the Company regarding the amount required to complete the said debenture payment and transfer thereof by the Company to the Nominee Company concomitantly. This section shall be regarded as irrevocable by the Company for the transfer of the said funds to the Nominee Company. L. It is clarified that the First Interest Cushion Amount, the Current Cushion Amount, and the Excess Amount, including the yield accrued thereon (hereinafter: "Cushion Interest Amounts"), shall be held by the Trustee in trust solely for the holders of Debentures (Series D), that the Company shall, in no case, have rights or claims with respect to the said amounts, and that the Company hereby irrevocably renounces any right for the Cushion Interest Amounts and/or in relation thereto and/or in connection therewith. M. The Company may, at its own discretion, to deposit with the Trustee, in lieu of the First Interest Cushion Amount, an autonomous unconditioned irrevocable bank guarantee provided by an Israeli bank rated at least AA, to be effective for up to 30 days after the maturity date of the Debentures in the amount equal to the First Interest Cushion Amount, or to be effective for one year and renewed annually such that with regard to the final period

---

33 1614780295.2 it shall be effective for up to 30 days after the maturity date of the Debentures in the amount equal to the First Interest Cushion Amount (hereinafter: "the Bank Guarantee"), or to replace the funds accrued in the Interest Cushion Account (except for the portion of the Expenses Cushion as specified in Section 5.5.2 below) with a bank guarantee in the amount of the Current Cushion Amount, as such shall apply on the date of replacement. Insofar as the Company deposited an annually renewing Bank Guarantee as aforesaid, if the Company did not provide an extension for the Bank Guarantee period or a new Bank Guarantee for one additional year, up to 21 days prior to the expiration date of the Bank Guarantee, the Trustee may forfeit the Bank Guarantee. N. Had the Company deposited with the Trustee such Bank Guarantee, all the provisions of this Section 5.5.1 shall apply to the Bank Guarantee, given the aforesaid, insofar as the Company is required to increase the Bank Guarantee amount in accordance with the provisions of Subsections (C) and/or (D) and/or (E) and/or (F) and/or (G) above, the Company shall deposit with the Trustee, within the periods set forth in said sections, an amendment to the Bank Guarantee and/or a new Bank Guarantee, such that pleases the Trustee, to replace or be added to the Bank Guarantee, as applicable. If the guarantee shall be replaced by a new guarantee as aforesaid, the previous guarantee shall be returned to the Company only upon the provision of the new guarantee. O. Insofar as the Company wishes to replace the First Interest Cushion Amount or the Current Cushion Amount with a Bank Guarantee, it shall notify the Trustee of the aforesaid and add a calculation signed by the senior financial officer of the Company with regard to the Current Cushion Amount as of said date. Such replacement of the First Interest Cushion Amount or the Current Cushion Amount, as applicable, shall be subject to the deposit of the Bank Guarantee, and the Trustee shall transfer back to the Company the funds accrued in the Interest Cushion Account after they were deposited with a bank guarantee, such that pleases the Trustee, in an amount equal to the 34 1614780295.2 First Interest Cushion Amount or the Current Cushion Amount, as applicable. With regard to the Company's undertaking to provide the Trustee with approvals in connection with this section, see Section 18.20 below. 5.5.2. Expenses Cushion A. Without derogating from the provisions of Section 26 of the Deed of Trust, an amount equal to USD 400 thousand out of the net proceeds of the offering shall remain in the Interest Cushion Account (as such term is defined above), which will be used for the payment of current and administrative expenses of the Trustee in the event that Debentures (Series D) are put up for immediate repayment and/or if the Company has violated the provisions of the Deed of Trust (hereinafter and above: the "Expense Cushion"). The Expense Cushion may be deposited by way of cash deposit out of the said proceeds of the offering, all or some thereof, or by a Bank Guarantee, as such term is defined in Section 5.5.1 above, according to the Company's own discretion and subject to its notification to the Trustee, provided a sum of USD 100 thousand shall be maintained in this expense cushion, at any time. In the event that the Expense Cushion includes a Bank Guarantee, the above provisions of this Section 5.5.1 shall apply to the Bank Guarantee, mutatis mutandis. B. The representative US Dollar/ New Israeli Shekel exchange rate for this purpose will be the representative exchange rate of the Central Israeli Bank as determined on the day of the Public Tender for the initial issuance of Debentures (Series D). The amount of the Expense Cushion will be held until and including the full and final repayment of Debentures (Series D). After receiving approval from the chief financial officer of the Company regarding the full repayment of Debentures (Series D), worded in a way that satisfies the Trustee's request, the Expense Cushion, whatever has not been used (plus any accrued earnings thereto), will be transferred to the Company in accordance with the details provided thereby. 35 1614780295.2 C. In the event that the amount of the Expense Cushion is insufficient to cover the expenses of the Trustee in connection with the immediate repayment of Debentures (Series D) and/or breach of the provisions of the Deed of Trust by the Company, the Trustee shall act in accordance with the provisions of Section 26 below. D. If the Expense Cushion is used, in whole or in part, the Company undertakes to complement the amount of the Expense Cushion up to the amount specified in Section 5.6 and this within 10 business days from the date on which the Company was requested to complement the said Expense Cushion. 5.6. Appointment of representative of the Company in Israel A. As long as there are outstanding Debentures (Series D), the Company undertakes that a representative of the Company will serve in Israel (hereinafter: the "Representative of the Company in Israel") to which it will be possible to deliver court notices to the Company and/or to the officers thereof. Delivery of court notices to the Representative of the Company in Israel shall be considered as valid and binding in connection with any claim and/or request by the Trustee and/or the holders of the Debentures (Series D) under this Deed of Trust. The Company shall be entitled to replace the Representative of the Company in Israel and the registered address from time to time, subject to Subsections B and C below. B. On the date of appointing/replacing the Company's Representative in Israel, the Company shall report the details thereof in an Immediate Report and will also deliver a notice to the Trustee with the details of the Company's Representative in Israel. In the event of appointing a new Representative, the Immediate Report and the Notice to Trustee shall also include the effective date of the appointment thereof. C. The Company undertakes that in the event of the replacement of the Representative of the Company in Israel, including resignation from office, the Company will appoint a Representative of the Company in Israel within a period not exceeding thirty (30) days. Until the appointment of the new representative as specified above, the address of the Company in Israel for the purpose of this Deed and for the purpose of the furnishing of court documents shall be the address of the replaced representative. 36 1614780295.2 D. The Company undertakes that a Representative of the Company in Israel shall serve until subsequent to the full, final and exact settlement of the Debentures (Series D). E. As at the signing date of this Deed of Trust, the Company's representative in Israel is U.S. Real Estate Representation Ltd. 5.7. Undertakings of the Company, Pacific Oak SOR Properties LLC, the REIT Fund5, and the officers of the Company The Company, Pacific Oak SOR Properties LLC, REIT Fund, and officers of the Company and of Pacific Oak SOR Properties LLC, present or future irrevocably undertakes and will irrevocably undertake (as applicable), the following: A. Not to raise claims against the application, validity or manner of implementation of Section 39A of the Securities Law; B. Not to raise any claims against the local authority of the Court in Israel with regard to proceedings launched by the Trustee and/or holders of the Debentures (Series D) of the Company. C. Not to raise any claims against the right of the holders of the Debentures (Series D) to file a derivative suit as well as a class action. D. In addition, in any agreement in which the Company engages indirectly with a third party, including its employees, it shall be determined that Israeli law will apply to the said agreements, including that insolvency proceedings against the Company will only be filed in a court in Israel, and under the Israeli law. In this regard it is clarified that this obligation does not apply to engagements of the Company with third parties, related with engagements of affiliated companies of the Company, (as this term is defined in the Securities Regulations (Annual Financial Reports), 5770 – 2010) and shall not apply to hedging agreements in which the Company contracted with a third party, should such engagement occur. E. Not to object to any motion by the Trustee and/or holders of the Debentures (Series D) to be filed with a Court of Law in Israel to apply Israeli law with regard to any settlement, arrangement and insolvency, if filed, not to apply to any Court of Law outside Israel for protection against any proceeding launched by the Trustee and/or holders of the Debentures (Series D), not to object should a 5 The REIT Fund undertook that if the control in the Company is sold, it undertakes that the sale will be conditioned upon the new Controlling Shareholder taking its place in connection with the liabilities listed under this section, in connection with the REIT Fund.

---

37 1614780295.2 Court of Law in Israel seek to apply Israeli law with regard to any settlement, arrangement, and insolvency. F. Not to initiate bankruptcy proceedings under foreign law and not in non-Israeli jurisdiction Regarding this matter, it should be noted that if an insolvency process will be commenced upon, not according to the Israeli law, and in a foreign court, deriving from a foreign creditor, and Company will do its best to claim for an "improper forum", subject to any law, and further – to refrain from making claims against the application, force, or manner of implementation of the applicable provisions of the Insolvency and Financial Recovery Act, 2018, pertaining to compromises and settlements, which include, inter alia, provisions replacing certain provisions of the Companies Act pertaining to compromises and settlements (Title C of Part F in Section II, concerning financial recovery, as well as Part C of Section X. concerning a material debt settlement involving a Debentures Company. G. Not to raise claims against the authority of the Securities Authority and/or the Administrative Enforcement Committee in Israel in connection with monetary fines and/or administrative enforcement measures imposed thereon by the Securities Authority and/or the Administrative Enforcement Committee in Israel, under Chapter H3 and/or H4 of the Securities Law, and to uphold all of the resolutions of the Securities Authority and/or the Administrative Enforcement Committee in Israel, including, without derogating from the generality of the above, to pay any monetary fine and/or payments to injured parties from a breach imposed thereon (if any) and to take measures to remedy the breach and prevent its recurrence. H. Not to amend the articles of association of the Company with respect to those articles which have been applied to the articles of association of the Company in order to reflect the Securities Order (Replacing the Fourth Schedule to the Law), 5776-2016; I. As long as there are outstanding Debentures (Series D) of the Company, and subject to the current tax laws, the Company and its investee corporations, as at the date of the Shelf Offering Report, will not choose to be considered as corporations, but will continue to be considered transparent for US tax purposes6. With respect to the undertaking of the Company for disclosure in connection with this section, see Section 5.11 below. 6 Except for with regard to entities which are not transparent entities for tax purposed at the time. 38 1614780295.2 J. It is hereby clarified that the undertakings in Sections a., b., c., e., f., and g. above will be assumed by each of the Company, Pacific Oak SOR Properties LLC, the REIT Fund, and the officers of the Company, while the rest of the undertakings shall be assumed as follows: 1. Undertakings in Section d. above – shall be assumed by the Company and Pacific Oak SOR Properties LLC only. 2. Undertakings in Section h. above – shall be assumed by the REIT Fund only. 3. Undertakings in Section i. above – shall be assumed by the Company, Pacific Oak SOR Properties LLC and the REIT Fund only K. The Company shall cause Pacific Oak SOR Properties LLC, the REIT Fund and the officers of the Company, as of the date of the signing of this Deed, to sign irrevocable undertakings as set forth in this Section 5.8 above and to publish these undertakings within 5 business days from the date of completion of the first issuance of the Debentures (Series D). In addition, the Company undertakes that no later than 5 business days following the appointment of a new officer of the Company and/or the date of change in control of the Company, the said undertakings shall be signed and published by a new officer of the Company or the new controlling shareholder, as applicable. 5.8. Operating Segment: A. The Company undertakes that all the real estate properties held by the Company, directly and/or indirectly, through companies held thereby, will be in the United States only. B. The Company undertakes that it will not change its main business activity during the life of the Debentures (Series D). It should be noted in this regard, that the main business activity of the Company and companies under its control on the date of the issuance is as specified in Section 1.1 F in Chapter A of the 2023 Report (as part of the income tax tests applicable to the REIT Fund so that it will be classified as a REIT fund). With regard to Company's undertaking regarding a disclosure in connection with this section, see Section 5.10 below. 5.9. Distribution Restrictions: 5.9.1. The Company undertakes not to make any distribution (as such term is defined in the Companies Law) and not to declare, pay 39 1614780295.2 or distribute any dividend unless all the terms set forth below are met: A. The Consolidated Equity Capital of the Company (as this term is defined in Section 6.3(1) below) (excluding minority interests), according to the Company's consolidated financial statements, which were published prior to the distribution date, less the distributed divided, shall not be less than USD 550 million (this amount will not be index-linked); B. The ratio of net Adjusted Financial Debt to net CAP (as such terms are defined in Section 6.3(2) below), shall not exceed 70%; C. Adjusted NOI (as the term is defined in the above Section 5.3) shall total no less than USD 40 million. D. There are no grounds for an immediate declaration that the Debentures (Series D) due and payable. E. On the date of the Board of Directors' decision on the distribution, there are no "Warning Signs" as the terms are defined below: "Warning Signs"7: (1) deficit in equity capital; (2) opinion or review by the independent auditor, as at the date of the financial statements, which draws attention to the Company's financial position; (3) deficit in the working capital, or deficit in the working capital during a period of twelve months coupled with an ongoing negative cash flow from current operations; (4) deficit in the working capital or deficit in the working capital during a period of twelve months, coupled with an ongoing negative cash flow from current operation, and the Company's Board of Directors has not determined that these do not indicate a liquidity problem in the Company; (5) opinion or review by the independent auditor, as at the date of the financial statements, which draws attention to significant doubts as to the Company's ability to continue as a going concern; F. The Company is in compliance with all the financial undertakings stated in Section 6.3 below, as per the 7 The abovementioned definition is taken from Regulation 10(b)(14) to the Securities Regulations (Periodic and Immediate Reports), 1970. It should be noted that if the definition is altered as part of legislative amendments of any kind, the abovementioned definition will be revised accordingly, mutatis mutandis. 40 1614780295.2 Company's consolidated financial statements, which were published before the date of distribution and the Company does not breach any of its undertakings to the Debenture holders (Series D). (the terms set forth in Sections (A) to (E) above shall be referred to collectively as: "the Distribution Restrictions"). 5.9.2. The Company will submit to the Trustee within two (2) business days after the distribution is approved by the Company's Board of Directors and prior to the actual distribution, certification by the chief financial officer of the Company that the Company is in compliance with the Distribution Restrictions (as the term is defined in Section 5.9.1 above), including the relevant calculation (regarding the restrictions set forth in Section 5.9.1 (A) to (F) above), (worded in a manner that will satisfy the Trustee), as well as regarding the fulfillment of the following conditions: (1) the Company is in compliance with its obligations to the holders of the Debentures (Series D) in accordance with the provisions of the Deed of Trust; (2) the distribution does not impair the ability of the Company to repay the Company's Debentures (Series D); (3) no cause for immediate repayment as per Section 8.1 below has been created. It should be clarified that the dividend restrictions will also be checked prior to the distribution, based on the Company's consolidated financial reports which were published prior to the performance of the distribution, and also under the assumption that the distribution was implemented. 5.9.3. Despite the above mentioned in this Section 5.9, it should be noted and emphasized that the REIT Fund should meet the regulatory restriction of dividend distribution in the U.S., according to which the fund must distribute up to 100% of its taxable income to its shareholders, in order to be classified as such (as a REIT fund) and not pay tax at the level a REIT fund is entitled to and enjoy tax reliefs granted to REIT funds in the US, as specified in Appendix A to Chapter A of the 2023 Report (hereinafter: the "Distribution Obligation of a REIT Fund"). Further to the foregoing, it should be emphasized that in order to maintain the Distribution Obligation of a REIT Fund, dividend distributions in a Company intended to serve Distribution Obligation of a REIT Fund, will not be subject to the aforesaid dividend restriction and these distributions will be implemented as required to maintain the status of the

---

41 1614780295.2 REIT Fund and to comply with the Distribution Obligation of a REIT Fund. Shortly before distribution as per this Subsection 5.9.3, the Company shall deliver to the Trustee a confirmation from the senior financial officer of the Company to the effect that the said distribution complies with this Subsection 5.9.3. 5.10. Dedicated Disclosure: The Company undertakes to specify and/or approve and/or include in each of the Board of Directors' Reports attached to the Company's financial statements thereof, dedicated disclosures to the holders of the Debentures of the Company, including stating the numerical figures and providing the calculation to the Trustee, in a wording to its satisfaction and as applicable (unless explicitly specified differently), as follows: 5.10.1. For the purpose of Sections 2.5.1 and 2.5.2 above: Until the implementation of the principal and interest payment on Debentures (Series B) which is due on January 31, 2025, the Company shall include a disclosure in its Board of Directors' Report regarding its compliance with the undertaking of Section 2.5.1 above and note the amount deposited in the Designated Deposit Account as of the reporting date of the relevant financial statement as well as the uses made with said funds in accordance with the provisions of Section 2.5.2 above, if such were made. 5.10.2. For the purpose of Section 5.3 above: The Company shall specify the compliance or non-compliance thereof with each of the financial covenants (as specified in section 5.3 above). 5.10.3. For the purposes of Section 5.7(i) above, the Company shall include a disclosure on its compliance and the compliance of all its held corporations with the provisions of Section 5.7(i) above. It should be clarified that the Trustee does not have data which will enable it to verify that the Company and the said corporations comply with these undertakings and therefore, the Trustee will rely for that matter on disclosure in the reports of the Company and shall not perform any examination thereof. 5.10.4. For the purposes of Section 5.8 above, the Company shall include a disclosure on its compliance/non-compliance with the provisions of Sections 5.8A and 5.8B above. 5.10.5. For the purposes of section 5.9 above: the Company will specify the compliance or non-compliance with the provisions of section 5.9 above. 42 1614780295.2 5.10.6. For the purposes of Section 6.2 below: The Company shall specify the compliance or non-compliance thereof with the said undertaking in Section 6.2 below of not creating a floating charge. It is clarified that the Trustee does not have data which will enable it to verify that the Company complies with these undertakings and therefore, the Trustee will rely for that matter on disclosure in the reports of the Company and the certifications detailed in this section above and shall not be requested to verify the correctness thereof. 5.10.7. For the purposes of Section 6.3 below: The Company shall detail in the notes for the financial statements, its compliance or non-compliance with any of the financial covenants (as defined in Section 6.3 below), including the numerical value of each of the financial covenants. 5.10.8. For the purpose of Section 6.5 below: The Company shall include disclosure regarding its compliance with the provisions of Section 6.4 below. 5.10.9. In this regard, the said disclosure standard shall remain the same from the execution date of this Deed and throughout the life of the Debentures (Series D), even if more lenient guidelines are publicized with regard to the standard existing at the time this Deed is signed. 6. Securing the Debentures 6.1. Debentures (Series D) are not secured by any collateral, pledges, or any other manner. For details of the Company's undertaking not to create any general floating charge, see Section 6.2 below. By entering into this Deed of Trust, and by agreeing to act as Trustee for the Debenture Holders, the Trustee is not conveying his opinion, explicitly or implicitly, as to the Company's ability to fulfill its obligations towards the Debenture Holders. For the avoidance of any doubt, it is clarified that the Trustee is under no obligation to examine, and the Trustee did not and will not examine, the need for providing collateral for securing payments to the Debenture Holders. The Trustee was not asked, and de facto did not and will not, conduct financial, accounting, or legal due diligence, as to the business circumstances of the Company or its Subsidiaries. The above shall not derogate from the Trustee's obligations under any law and/or the Deed of Trust, and likewise shall not derogate from the Trustee's obligation (to the extent that such an obligation exists by any law) to examine the effects of changes in the Company from the issuance date onwards, to the extent 43 1614780295.2 that they may have a detrimental effect on the Company's ability to fulfill its commitments to the Holders of the Debenture (Series D). 6.2. Undertaking not to create floating charge: 6.2.1. The Company undertakes not to pledge all of its current or future properties and assets (held thereby directly only) to a general floating charge, without the prior approval of the meeting of holders of the Debentures (Series D) by special resolution. It should be emphasized that the Company shall be permitted to pledge its property, in whole or in part, in specific pledges (including a floating charge on specific property/properties), without obtaining the consent of the holders of the Debentures (Series D) thereto. The Company clarifies that as of the date of the signing of this Deed, the Company has not created and has not undertaken to create a general floating charge as stated above. 6.2.2. For the avoidance of doubt, it is hereby clarified that Subsidiaries of the Company are entitled to pledge the properties thereof, in whole or in part, under any charge (including a floating charge on their entire property) and in any manner, without the need to obtain the consent of the meeting of the holders of the Debentures (Series D). The Company will furnish to the Trustee no later than 30 days after the signing of this Deed an opinion from an attorney specializing in the laws of the British Virgin Islands applicable to the Company, in accordance with which there is no legal obligation under the British Virgin Island law to record a negative lien as specified in Section 6.2 above in any registry conducted under the applicable law. The Company shall furnish the Trustee each January 31 of each year with authorizations of an attorney specializing in the British Virgin Island law applicable to the Company, whereby as at December 31 of prior calendar year, the Company did not register in its registers and/or in any other registry conducted under the relevant law any charge contrary to the provisions of Section 6.2 above in favor of any party contrary to its undertakings under Section 6.2 above, as applicable. A certification from the register conducted under the relevant law applicable to the Company shall be attached to the aforesaid approvals. The Company shall be entitled to sell, lease, assign, give or transfer in any way whatsoever, all or part of the assets thereof, to any person it deems fit, without requiring the approval of the Trustee and/or 44 1614780295.2 the Debenture Holders (Series D), as the case may be, subject to the provisions of section 8.1.15 below. 6.2.3. With respect to the undertakings of the Company for disclosure in connection with this section, see Section 5.10 above. 6.2.4. It is clarified that the Trustee does not have data which will enable it to verify the compliance of the Company with the undertakings thereof detailed in this Section 6.2, and therefore, the in order to examine the compliance of the Company with the provisions of this Section 6.2, Trustee will rely for that matter on the Company's reports and the certifications detailed in this section above and shall not be requested to verify the correctness thereof. 6.3. Financial covenants Until subsequent to the full and final payment of the debt pursuant to the terms of the Debentures (Series D) and fulfillment of all the Company's other obligations to the holders of the Debentures (Series D) pursuant to this Deed and the terms of the Debentures (Series D), the Company shall comply at any time with the financial covenants set forth below (hereinafter and above "the Financial Covenants"): (1) The Consolidated Equity Capital of the Company (excluding minority interests) will not be less than USD 450 million (this amount will not be index-linked) (hereinafter: the "Equity Covenant" or the "Minimum Equity"). "Consolidated Equity of the Company": The Company's equity according to the consolidated Financial Statements of the Company, including the principal of shareholder loans subordinate to the Debentures, if any. i.e., owners' loans meeting all of the following conditions: (a) their maturity date (principal and interest) is scheduled for after the final payment of the debentures; (b) the loans (principal and interest) are inferior in their maturity compared to the debentures, including in the event of dissolution. (2) The Net Adjusted Financial Debt ratio to the net CAP shall not exceed 75% (hereinafter: "Ratio of Debt to CAP Covenant" or "Ratio of Debt to Maximum CAP"). "Net Adjusted Financial Debt" – shall mean a debt carrying short and long term interest from banks and financial institutions, as well as from institutions the main activity of which is granting loans, plus debt carrying interest in favor of the holders of debentures issued by the Company, net of cash and cash equivalents and net of short-term investments and loans provided, the repayable date of which shall

---

45 1614780295.2 not exceed three years from the date of the relevant balance sheet, marketable securities and deposits (including properties with restrictions, except for pledged deposits provided against guarantees), all based on the consolidated financial statements of the Company, plus the proportionate consolidation of the net financial debt in affiliated companies and in the Company's jointly controlled companies. "Net CAP" – shall mean adjusted net financial debt in addition to the Consolidated Equity Capital of the Company (including minority rights). (3) Adjusted NOI (as the term is defined below) shall total no less than USD 35 million (hereinafter: "NOI Covenant" or "Minimum NOI"). "Adjusted NOI": the Company's income from rent (in the recent four quarters), including interest revenues stemming from providing loans by the Company in consolidation (including revenues stemming from purchased loans), and income, including distributions, generated by the Company from investments in REIT funds or other corporations, net of property rental costs (in the recent four quarters), plus the share of the Company in the Adjusted NOI of affiliated companies and jointly controlled companies (proportionate consolidation). It is clarified that upon purchasing one or more rental property and/or completion of a property in construction and/or property contribution during the period and/or the provision of loans by the Company in a consolidation (including revenues from loans purchased by the Company) and/or additional investment in REIT funds or other corporations, the Adjusted NOI of the property/properties or loan/s or investment/s shall be calculated in accordance with the extent of the adjusted NOI as of the date of acquisition and/or completion of an property in construction and/or contribution of the property and/or the provision or purchase of the loan and/or the performance of the investment and until the date of the relevant financial report, annualized. For the avoidance of doubt, it should be clarified that upon the sale or subtraction of one or more properties, the aforesaid annualization will not be performed for the adjusted NOI for the period prior to the sale date. The examination regarding the Company's compliance with each of the Financial Covenants in Subsections (1) to (3) above will be conducted on the date of publication of the Company's financial statements and as long as there are outstanding Debentures (Series D), in relation to the quarterly/annual financial statements which the Company would have 46 1614780295.2 published until that date (in this Section 6.3 below: "Examination Date"). With respect to the undertaking of the Company for disclosure in connection with this section, see Section 5.11 above. With respect to the undertaking of the Company to provide authorizations to the Trustee in connection with this section, see Section 18.20 below. If the Company's equity drops below the Minimum Equity and/or the ratio of the debt to the CAP exceeds the ratio of the debt to the maximum CAP and/or the Adjusted NOI of the Company is lower than the Minimum NOI on any examination date, as applicable, the Company shall notify the Trustee of such in writing and report this data and the meaning of this data by means of an immediate report via the Magna system, no later than one business day after the publication of the financial statements (quarterly and annual). For purposes of this section, reporting via the Magna system will not be considered reporting to the Trustee. Failure to comply with the Equity Covenant for two consecutive quarters and/or failure to comply with the debt to CAP ratio covenant for two consecutive quarters and/or failure to comply with the NOI covenant for two consecutive quarters (i.e., on two consecutive Examination Dates), shall constitute grounds for declaring the outstanding balance of the Debentures (Series D) due and payable, as specified in Section 8.1.12 below. It is clarified that, for the purpose of this Deed, in the event of a change in the accounting standards applied to the Company, as opposed to those applied to the Company on the date of signing this Deed (hereinafter: the "Existing Standards") in such a manner as to affect the results of the calculation of any of the financial covenants specified in this Deed, the Company's compliance with the financial standards set forth in this Deed shall be examined only in accordance with the existing accounting standards. Company shall, in such a case, detail in the footnotes to its quarterly or annual financial statements, the result of the calculation of the Financial Covenants according to existing accounting standards, and if there are any disparities between the aforementioned calculation in accordance with the Existing Standards and a calculation in accordance with the New Standards, the material items, from which the above- mentioned disparities arise, shall be specified. 6.4. The Company undertakes that as long as the Company does not comply with any of the financial covenants set forth in Section 6.3 above, it will not assume any financial debt with a right of recourse to the Company, except for a financial debt from the partnership or the REIT which will 47 1614780295.2 be subordinate (principal and interest) to the Debentures (Series D) of the Company, both in terms of the Company's insolvency and in terms of the repayment date (namely, if the repayment date is after the final repayment date of the debentures and it is not permitted to place them for immediate repayment prior to the full and final repayment of the debentures). Furthermore, so long as the Company does not comply with the financial covenants set forth in Section 6.3 above, the Company shall not assume any financial debt with a right of recourse to the Company (non-recourse), unless the debt was made for the purpose of remedying the failure to comply with the financial covenants or for the purpose of repayment on account of a principal or interest of the Debentures (Series D), in whole or in part. The undertaking stated in this Section 6.4 shall not derogate from the undertaking in Section 6.5 below and subject thereto. If the Company does not comply with any of the financial covenants and in the period during which the Company does not comply with any of the financial covenants as stated above, the Company shall include a disclosure in the financial reports, as applicable, as part of the dedicated disclosure to the debenture holders, regarding its compliance with the obligations in Section 6.3 above. Additionally, throughout the aforementioned period, of the Company were to assume such a financial debt, the Company shall deliver an approval, signed by the senior financial officer, worded to the satisfaction of the Trustee, according to which: (1) if it is a recourse debt to the Company – that the debt is to the REIT or the partners in the Company and that it is subordinate to the Debentures, as stated above; or (2) if the debt is non-recourse to the Company – that the debt was made for the purpose of remedying the failure to comply with the financial covenants or for the purpose of repayment of the aforementioned Debentures. The Trustee shall rely on the office holder's approval and on the Company's disclosure in the aforementioned statements and shall not be required to conduct any further inspections. 6.5. The Company undertakes that it will not take credit from non-Israeli financial institutions and will not grant pledges to non-Israeli financial institutions, except for credit facilities (non-recourse) that may be provided by US financial institutions for the purpose of implementing hedging transactions on the exchange rate of the shekel against the dollar in relation to the Debentures to be issued by the Company and this will be done by granting specific pledges to secure such credit facilities. With respect to the undertaking of the Company for disclosure in connection with this section, see Section 5.10 above. 48 1614780295.2 With respect to the undertaking of the Company to provide authorizations to the Trustee in connection with this section, see Section 18.20.5 below. 7. Early redemption 7.1. Early redemption at the discretion of the TASE If the Tel Aviv Stock Exchange decides to delist the Debentures from trading because the value of the Debentures series falls below the amount prescribed in the TASE Regulations regarding delisting, the Company shall act as follows: A. Within 45 days from the date of the TASE Board of Directors resolution to delist the Debentures, the Company will announce an early redemption date on which the holder may redeem the Debentures. B. The early redemption date with regard to the Debentures will not take place no less than seventeen (17) days from the date of publication of the announcement and no later than forty-five (45) days from said date, but not during the period between the Effective Date for the payment of Interest and the actual date of payment thereof. C. On the early redemption date, the Company will redeem the Debentures of the Holders of which requested the redemption thereof and the amount paid to Debentures Holders in the case of such an early repayment shall be the higher from among the alternatives listed in the below Section 7.2.9. The aforementioned early repayment amount shall be no less than the collateral value of the debentures (that is, the nominal value of the debentures with the addition of interest that has accrued on the principal until the actual redemption date). The interest will be calculated on the basis of 365 days per year. D. The setting of an early redemption date as aforesaid is without prejudice to the rights of redemption as stipulated in the Debentures, for those Holders of the Debentures who do not redeem them on the early redemption date as aforesaid, but the Debentures will be delisted from the TASE, and the resulting tax implications will apply thereto. Early redemption of the Debentures as aforesaid, will not grant to a Debenture Holder who redeems the same as stated the right to the payment of interest in respect of the period after the redemption date.

---

49 1614780295.2 The Company will publish notice of the earliest redemption date in an immediate report. The said notice will also detail the proceeds of the early redemption. 7.2. Early redemption at the discretion of the Company 7.2.1. The Company may, at its sole discretion, to perform early redemption, fully or partially, of the Debentures (Series D), commencing 60 days have passed after the date of the listing thereof on the TASE in which case the following provisions shall apply, all subject to the guidelines of the Securities Authority and the provisions of the TASE Rules and Regulations as shall be in effect on the relevant date: 7.2.2. The frequency of early redemptions shall be limited to one per quarter. 7.2.3. If a partial early redemption is scheduled for a quarter with a pre-scheduled interest payment, or partial redemption payment or final redemption payment, the partial early redemption will occur on the date designated for such payment. Notwithstanding the aforementioned, a full redemption may be completed also in a quarter in which an interest payment has been made or a partial redemption completed. For purposes of this section, "quarter" shall mean any of the following periods: January–March, April–June, July– September, October–December. 7.2.4. The minimum amount of early redemption of Debentures shall not be less than ILS 1 million. Notwithstanding the aforesaid, the Company may make an early redemption of Debentures totaling less than ILS 1 million provided the frequency of the redemptions a year will be limited to one. 7.2.5. Any early redemption amount will be paid on a pro-rata basis to the holders of the Debentures (Series D) at the par value of the Debentures (Series D) held. 7.2.6. Upon the Company's Board of Directors' resolution to make an early redemption as aforesaid, the Company shall publish an immediate report with a copy to the Trustee no less than seventeen (17) days and no more than forty-five (45) days prior to the early redemption date. In said immediate report, the Company will publish the early redemption amount of the principal and the interest accrued on the principal until the early redemption date, in accordance with the following provisions. The early redemption date shall not occur in the period between 50 1614780295.2 the record date for interest payment in respect of the Debentures (Series D) and the actual interest payment date. 7.2.7. Early redemption will not be made for a portion of the Debentures (Series D) if the last redemption amount is less than ILS 3.2 million 7.2.8. On the date of partial early redemption, as the case may be, the Company will pay to the Debenture Holders (Series D), the interest accrued only on the part of the partial early redemption, and not for the entire outstanding balance. If an additional interest is paid due to early redemption, the additional interest will be paid on the par value that was redeemed on the early redemption only. On the date of a partial early redemption, should there be one, the Company shall give notice in an immediate report of: (1) the percentage of the partial redemption in terms of the unpaid balance; (2) the percentage of the full redemption in terms of the original series; (3) the interest rate of the full redemption on the redeemed part; (4) the percentage of the interest rate that will be paid in the partial redemption, calculated in respect of the unpaid balance; (5) an update of the percentage of the partial redemptions that remain, in terms of the original series; (6) the record date for eligibility to receive an early redemption of the debenture principal that shall be twelve days (12) prior to the date set for the early redemption. 7.2.9. The amount paid to the holders of the Debentures (Series D) in the event of early redemption, shall be the higher of: (1) the market value of the Debentures (Series D), offered for early redemption, which will be determined based on the average closing price of the Debentures (Series D) in the thirty (30) trading days prior to the date of the Board of Directors' resolution regarding an early redemption ("Market Value of Debentures Balance" and "Sample Period", respectively) multiplied by the early redemption rate of debentures in circulation. Notwithstanding the aforementioned, should the partial or full early repayment be scheduled for a quarter in which an interest payment date is also scheduled, and the early repayment is undertaken in that same quarter (together with the interest), then in such a case, for the purpose of calculating the market value of debentures to be paid to holders in accordance with this current Section, the amount being remitted on that date shall be deducted from the Market Value of the Debentures Balance, solely against the interest payment, and the balance of 51 1614780295.2 the amount, after deducting the interest to be paid on the payment date, shall be multiplied by the early redemption share. It shall further be clarified that should an interest payment be remitted over the course of the Sample Period, than the amount paid solely against the interest shall be deducted from the closing price established during the trading days included in the Sample Period and which occurred prior to the aforementioned determining date for the interest payment.; (2) the liability value of the outstanding Debentures (Series D) called for early redemption, that is, the principal plus interest, until the actual early redemption date; (3) the balance of cash flow of the Debentures (Series D) called for early redemption (principal plus interest), discounted at the government bond yield (as defined below and no lower than 0%) plus 1.5% per annum. The discounting of the Debentures (Series D) that are called for early redemption will be calculated from the early redemption date to the last repayment date scheduled for the Debentures (Series D) which are called for early redemption. For purposes of this section – "Government Bond Yield" means the average yield to maturity (gross) in the seven business day period that ends two business days before the date of the notice of early redemption notice, of three unlinked series of government bonds in Shekels, bearing a fixed interest rate, whose average life is the closest to the average life of the Debentures on the relevant date, i.e. one series with the nearest high average duration of the Debentures (Series D) on the relevant date, and one series below the average duration of the Debentures (Series D) on the relevant date whose weight will reflect the average duration of the Debentures on the relevant. For example: if the average duration of the Government A Debentures is four years, the average duration of Government B Debentures is two years and the average duration of the loan balance is 3.5 years, the yield will be calculated as follows: 4x + 2(1-x) = 3.5 X = the yield weight of the Government A Bonds. X = the yield weight of the Government B Bonds. According to the calculation, the annual return of the Government A Debentures will be weighted at a rate of seventy-five percent (75%) of the "return" and the annual rate of the Government B Debentures will be weighted at a rate of twenty-five percent (25%) of the "return." 52 1614780295.2 Should no government debentures series with shorter maturities than Debentures (Series D) remain in circulation, then the government bond yields shall be calculated using the average yield of two government bond series with attributes as detailed in the definition of the term Government Bond Yield, above, with an average duration closest to the average lifetime of Debentures (Series D) on the applicable date. To avoid doubt it shall be clarified that the government bond yield shall be no lower than zero, i.e., should calculation set forth in the definition of the Government Bond Yield result in a negative total, then in the calculation the capitalization interest rate for the purpose of substitution (3) in this current Section, above, the rate pertaining to the Government Bond Yield shall be 0% (i.e., the capitalization interest rate in this case shall total 1.5%). In the case of an additional interest payment due to the early repayment, the additional interest shall be paid solely on nominal value being redeemed under the terms of the early repayment. 7.2.10. The Company shall furnish to the Trustee, within five business days from the date of the resolution of the Board of Directors regarding the early repayment in accordance with any of the options set for in this current Section 7.2, above, a certification by the Company's' auditing CPA regarding the calculation of the early repayment amount, worded in a manner that will satisfy the Trustee. 8. The right to declare the Debentures due and payable 8.1. Upon the occurrence of one or more of the cases listed in this section below, the provisions of Section 8.2 below will apply, as relevant: 8.1.1. If the Company does not repay any payment it will receive pursuant to the Debentures or under the Deed of Trust or will not comply with any of the other material undertakings made to the holders, and the Company has not cured such default within 5 business days. 8.1.2. If the Company applies for initiation of proceedings, as it is defined in the Insolvency Law and Rehabilitation Law, 2018 (hereinafter: "The Insolvency Law") or any similar order in accordance with the provisions of the Insolvency Law, or if the Company files a request for a settlement or arrangement with

---

53 1614780295.2 the creditors of the Company under Article 350 of the Companies Law, 1999, or in accordance with the provisions of the Insolvency Law, or if such an order is granted against the Company or if the Company offers its creditors in another manner a settlement or arrangement as aforesaid, due to its inability to meet its obligations on time, or a similar procedure has been conducted by the Company or towards the Company by the law applicable to the Company. With respect to this section, the abovementioned orders which were filed by any third party with the consent of the Company shall be deemed as orders filed by the Company. 8.1.3. If an application pursuant to the Insolvency Law or an application under Article 350 of the Companies Law is submitted against the Company (not with the Company's consent), or a similar proceeding pursuant to the foreign law applicable to the Company, against the Company (not with the Company's consent) which was not dismissed or canceled within 45 days from the date of submission thereof if filed in Israel (hereinafter solely in this current Subsection: "The Remedy Period"), or a similar procedure has been conducted by the Company or towards the Company by the law applicable to the Company. It shall be clarified that the Remedy Period pertaining to such a request filed outside of Israel shall be 45 days from its filing date. 8.1.4. If the Company adopts a valid resolution for the liquidation thereof (other than liquidation for the purpose of a merger with another company as specified in Section 8.1.17 below), or a final liquidation order has been made by the court and/or if a trustee has been appointed for the Company, as defined in the Insolvency Law, or another office holder of similar characteristics, or a similar resolution has been made or a similar office holder has been appointed by the Company and/or towards the Company, in accordance with the Insolvency Law, or by the law applicable to the Company. 8.1.5. If a temporary liquidation order or a similar order per the applicable law has been granted or a similar order per the applicable law, and/or a temporary trustee has been appointed, as this term is defined in the Insolvency Law, or a similar office holder who will be appointed by the applicable law, and/or any judicial decision of a similar nature has been rendered, and such order or decision were not dismissed or canceled within 45 days of the date of issuing the order or rendering the decision, as the 54 1614780295.2 case may be. Notwithstanding the aforesaid, the Company will not be provided any remedy period with respect to applications made or orders issued, as the case may be, by the Company or with its consent. 8.1.6. If an application has been filed for receivership or the appointment of a receiver (temporary or permanent) or any similar office holder who will be appointed by the applicable law for the Company or for a Material Property of the Company (as the term is defined below), or if an order has been issued for the appointment of a temporary receiver or a similar office holder who will be appointed by the applicable law, which was not dismissed or canceled within 45 days of the date of filing the application or issuing the order, as the case may be; or – if an order has been filed for a permanent receiver for the Company or for a Material Property of the Company (as the term is defined below) a similar order as per the applicable law. Notwithstanding the foregoing, the Company will not receive any cure period with respect to the requests or orders submitted or given, as the case may be, by the Company or with its consent. In this Deed: "Material Property of the Company" is a property or a number of cumulative properties of the Company or corporations held by the Company (according to the Company's holdings percentage), the value of which, in accordance with the Company's latest consolidated financial statements (audited or reviewed), on the date of an event, exceeds 35% of the total consolidated assets of the Company under these financial statements. 8.1.7. If an attachment is imposed or if an act of execution is carried out or a similar procedure as per the applicable law, in connection with a Material Property of the Company (as this term is defined in Section 8.1.6 above), and the attachment is not rescinded, or the action is not cancelled, as the case may be, within 45 (forty-five) days following the imposition or execution thereof, as the case may be. Notwithstanding the foregoing, the Company will not be granted any remedy period in relation to the applications filed or orders issued, as the case may be, by the Company or with its consent. 8.1.8. If there is a real concern that the Company will not meet its material obligations toward the holders of the Debentures (Series D). It is clarified that among the material obligations of 55 1614780295.2 the Company are included among other things the amounts of payments to the holders and the dates of the payments. 8.1.9. If the Company terminated or announced its intent to terminate the payment of its debts or ceased or announced its intent to cease to manage its business affairs, as they shall be from time to time. 8.1.10. If there was material deterioration in the Company's business compared to its condition on the date of the initial offering of the Debentures (Series D) and there is a real concern that the Company would not be able to repay the Debentures (Series D) on time. 8.1.11. If another series of Debentures issued by the Company, which is listed for trading on a stock exchange (hereinafter in this section: "the Other Series") or in another debt of the Company or a consolidated subsidiary were called for immediate repayment, the liability value of which exceeds 15% of the Company's total property listed in the consolidated balance sheet according to the recently published financial statements (audited or unaudited), or a debt of an affiliated company, in which the product of the holdings (in the final chain) in the said company of the value of the liability exceeds 15% of the Company's total property listed in the consolidated balance sheet according to the recently published financial statements (audited or unaudited) (hereinafter: "the Other Debt"). A non- recourse loan to a borrower, or a part thereof, shall for this purpose not be considered as Other Debt, as stated above. In a loan which is a non-recourse loan to a borrower that includes a part that is with a recourse to the borrower, then only such part out of the total loan will be considered as said above Another Debt. In this respect, it should be noted that in connection with another debt, for which the Company's liability was a result of a guarantee provided for the repayment of the said debt, the cause mentioned in Section 8.1.11 will be created only if the following conditions exist: (1) The Company's guarantee for debt repayment is not limited in amount or it is limited to an amount which is higher than the amount of the other debt (as defined above); and (2) the Company was requested to repay at least an amount which is higher than or equal to the said debt; if the above-mentioned conditions exist then the said cause shall apply, and this is from the date the Company was requested to pay the other debt in effect rather than from the date of requesting immediate repayment, if these dates differ. 56 1614780295.2 8.1.12. If the Company has not met any of the financial covenants in Sections 6.3 (1) until (3) (inclusive) above during two consecutive quarters. 8.1.13. If the Company performs a distribution contrary to the dividend limitation provisions, as set forth in Section 5.9 above; 8.1.14. If the rating of the Debentures (Series D) by the Rating Agency will be reduced to a rating that is lower than BBB minus or a parallel rating. In the event that the Rating Agency is replaced, the Company shall submit to the Trustee a comparison between the rating scale of the replaced Rating Agency and the rating scale of the new Rating Agency. For purposes of this section below, it is emphasized that in the event that the Debentures (Series D) would be rated by more than one Rating Agency, the review of the rating with respect to the grounds for immediate repayment shall be conducted, any time, based on the lower rating. 8.1.15. If the Company sells to another / others the Bulk of the Company's assets during two consecutive calendar quarters, and the prior consent of the Debentures (Series D) holders to the said sale is not received in a special resolution. For the purpose of this subsection – "Sale to Another" – sale to any third party, excluding a sale to corporations fully held by the Company, as well as excluding a sale the majority of the revenues thereof shall be used by the Company, within a period of six months after the date of completing the sale transaction, for the purchase of other property/properties characterized appropriately to the Company's field of business, as such shall be on the date of said sale; "Bulk of the Company's Properties" – a property or a combination of several properties, the value and/or aggregate value of which (as applicable) in the last consolidated financial statements published prior to the occurrence of the relevant event exceeds 50% of the value of its properties in the consolidated balance sheet, based on the said financial statements. 8.1.16. If the Company breaches any of its undertakings in Section 5.10 above. 8.1.17. If a merger of the Company was performed without the prior approval of the holders of the Debentures (Series D) by a special resolution, unless the recipient entity (as applicable)

---

57 1614780295.2 warrants to the holders of the Debentures (Series D), including by means of the Trustee, at least 10 business days before the date of the merger, that there is no reasonable concern that because of the merger the recipient entity will not be able to meet its obligations to the holders of the Debentures (Series D). Nothing in this section shall derogate from the other grounds for immediate repayment that are granted to the Debenture Holders pursuant to Section 8.1 above and below. In addition, commencing a period of 30 days prior to the date of the planned merger, all the grounds enumerated in Section 8.1 shall also apply to the recipient entity as if it were the Company. With regard to sections the provisions of which arise from the Company's financial statements, the review shall be conducted in relation to the financial statements of the recipient entity as these will be following the merger. 8.1.18. If trading in the Debentures (Series D) on the TASE was suspended by the TASE, except for suspension on the grounds of ambiguity as stated in the fourth part of the TASE Regulations, and 60 days have elapsed from the date of suspension during which the suspension was not cancelled. 8.1.19. If the Company is wound up or liquidated for any reason whatsoever. 8.1.20. If the Company commits a fundamental breach of the terms of the Debentures (Series D) or the Deed of Trust, and if it turns out that a material representation of the Company's representations in the Debentures or the Deed of Trust is incorrect or incomplete, and the Company has failed to remedy such breach within 7 business days of the date of receiving the notice. 8.1.21. If the Debentures (Series D) will cease to be rated for a period exceeding 60 days following reasons or circumstances under the control of the Company (in this regard, the non-performance of payments that the Company undertook to pay the Rating agency and the failure to provide reports and information reasonably required by the Rating agency within the engagement between the Company and Rating agency will be considered to be reasons and circumstances under the Company's control). 8.1.22. If the Company expands the series of Debentures (Series D) or issues an additional debenture series, in violation of the provisions of Section 4 of the Deed of Trust. 58 1614780295.2 8.1.23. If the Company ceases to be a Reporting Corporation, as it is defined in Section 1 of the Securities Law. 8.1.24. If the Company does not publish a financial statement as it is required to publish under any law or under the provisions of the Deed, within 30 days of the final date for the publication thereof as required or from the end of an extension granted by an authorized agency. 8.1.25. If the Debentures (Series D) are delisted from the TASE. 8.1.26. If the Company breaches its commitment not to pledge all of its assets with a general floating pledge as stated in Section 6.2 above. 8.1.27. If the Company is no longer 100% held (indirectly, by chain) by the REIT Fund. 8.1.28. Upon the occurrence of any other event that constitutes a material breach and/or may cause material harm to the rights of the debenture holders. 8.1.29. If the Company takes a financial debt or credit contrary to the stated in Section 6 above, as applicable. 8.1.30. If a "Going Concern" comment is registered in the financial statements of the Company for a period of two consecutive quarters. 8.1.31. If any of the events specified in section 8.1.2 to 8.1.5 above occurred with respect to the Partnership and/or the REIT Fund. 8.1.32. If the REIT Fund acts in the Company operating segment (as described in Section 5.8 above) not through the Company, and without the consent of the Debenture Holders (Series D) granted by Special Resolution. 8.1.33. If the Company does not meet its undertaking specified in Section 5.4 above; 8.1.34. If the Company does not comply with the undertakings specified in section 5.6 above; 8.1.35. If the Company breaches any of its undertakings detailed in Section 5.5 above, in connection with the expense cushion and/or the interest cushion. 8.1.36. If the Company breaches its undertaking detailed in Section 2.5.1 and 2.5.2 above regarding the deposit of funds in the Designated Deposit Account and does not remedy such breach within 5 business days. 59 1614780295.2 8.2. In the event of one of the instances set out in Sections 8.1.1 above the following provisions shall apply, as applicable: 8.2.1. Upon the occurrence of any of the events specified in Section 8.1 above, the Trustee shall be obligated to convene a general meeting of the holders of the Debentures (Series D), the date of which shall be 21 days after the date of invitation thereof (or a shorter date in accordance with the provisions of Section 8.2.5 below), and whose agenda will include a resolution regarding the immediate repayment of the outstanding balance of the Debentures (Series D) upon the occurrence of any of the events specified in Section 8.1 above, as applicable. The convening notice will specify that if the Company shall act in a manner that will eliminate and/or put an end to the event specified in Section 8.1 above for which the general meeting was convened, until the date of the general meeting, the convening of the general meeting of debenture holder will be canceled. 8.2.2. The holders' resolution to declare the Debentures (Series D) due and payable shall be adopted at a meeting attended by holders of at least fifty percent (50%) of the nominal value of the outstanding Debentures (Series D), by a majority of holders of the outstanding par value of the Debentures participating in the vote or such majority at an adjourned meeting attended by holders of at least twenty (20%) of the aforesaid outstanding nominal value. 8.2.3. If as of the date of the meeting, any of the events specified in Section 8.1 above has not been cancelled or removed, and a resolution in the meeting of the Debentures (Series D) has been adopted in the manner stipulated in Section 8.2.2 above, the Trustee will be obligated, within a reasonable period of time and no later than two business days, to declare the outstanding balance of the Debentures (Series D) for immediate repayment. 8.2.4. A copy of the notice for convening the said meeting will be sent by the Trustee to the Company and the notice of a meeting shall constitute a prior written warning to the Company of the Trustee's intent to declare the Debentures due and payable as aforesaid and/or exercise collateral (if such are provided). 8.2.5. The Trustee may, at its discretion, reduce the period of 21 days specified in Section 8.2.1 above if he deems it necessary to protect the rights of the holders 8.2.6. The Trustee and/or the Holders will not call the Debentures for immediate repayment and/or shall not act to exercise collateral 60 1614780295.2 (if such are provided), until after the Company is provided within notice of its intention to do so; however, they will be entitled not to provide the Company with any notice if there is a concern that furnishing the notice will harm the possibility of calling the Debentures for immediate repayment. 8.2.7. If any of the subsections of Section 8.1 above stipulate a reasonable period in which the Company may take action or make a decision that will remove the grounds for immediate repayment, the Trustee or the holders may declare the Debentures due and payable as stated in Section 8, only if the period stipulated as aforesaid has elapsed and the grounds have not been removed; however, the Trustee may reduce the said period if it is of the opinion that it could materially prejudice the rights of the Holders. 8.2.8. For the avoidance of doubt, nothing in Section 8.2 above shall derogate from the powers of the Trustee to declare the Debentures (Series D) due and payable, at its discretion and/or to act to exercise collateral (if such are provided). 8.2.9. If the Company acts, at its sole discretion, to appoint an urgent representation of the holders of Debentures (Series D) in the event of foreseen non-compliance with one or more of the financial covenants, the provisions stipulated in the Third Schedule to the Deed of Trust must be followed. 8.2.10. For the avoidance of doubt, it is clarified that the immediate repayment shall be based on the nominal value of the outstanding Debentures (Series D), including interest accrued on the principal amount, (and arrears interest, if applicable) while the interest will be calculated for the period beginning after the final day in respect of which interest was paid and ending on the immediate repayment date (the calculation of the interest for a portion of the year will be based on 365 days a year). 8.2.11. For the avoidance of doubt, it is clarified that the right of immediate repayment as aforesaid and/or declaring the Debentures due and payable shall not impair or prejudice any other or additional remedy available to the holders of the Debentures (Series D) or to the Trustee under the terms of the Debentures (Series D) and the provisions of this Deed or pursuant to any law and the decision not to call the Debentures due and payable upon the occurrence of any of the events listed

---

61 1614780295.2 in Section 8.1 above, shall not constitute a waiver of the rights of the Debenture Holders or the Trustee, as stated. 9. Claims and proceedings by the Trustee 9.1. In addition to any provision herein and as an independent authority, the Trustee may, at its discretion and without giving notice, adopt all such proceedings, including legal proceedings and applications for orders, as it finds fit and subject to the provisions of any law, to protect the rights of the holders of the Debentures (Series D) and enforce the Company's duty to meet another obligation under the Deed of Trust. Nothing in the foregoing shall prejudice and/or derogate from the Trustee's right to institute legal and/or other proceedings, even if the Debentures (Series D) have not been declared due and payable, all with a view to protecting the holders of the Debentures (Series D) and/or for purposes of issuing any order with regard to Trusteeship matters and subject to the provisions of any law. Notwithstanding the provisions of this section, it is clarified that the right to declare the Debentures due and payable will arise only in accordance with the provisions of Section 8 above and not by virtue of this section. 9.2. Subject to the provisions of the Deed of Trust, the Trustee is entitled, but not obliged, to convene at any time, a general meeting of the holders of Debentures (Series D) in order to discuss and/or receive its instructions on any matter relating to the Deed of Trust. 9.3. Any time the Trustee is obligated under the terms of the Deed of Trust to take any action, including instituting proceedings or filing claims at the request of the holders of Debentures (Series D) as stated in this section, the Trustee is entitled, at its sole discretion, to delay the execution of any said action until such time as it receives instructions from the general meeting of the Debentures (Series D) holders in an ordinary resolution and/or instructions from the court how to act provided that the convening of the meeting or petition to the court takes place at the first possible date. For the avoidance of doubt, it is clarified that the Trustee is not entitled to delay the taking of actions or proceedings as stated in the case in which the delay may harm the rights of the Debentures (Series D) holders. 9.4. The Trustee may, subject to the provisions of Section 28 below, waive the same terms that it sees fit for upholding all or part of the undertakings of the Company. 9.5. The Trustee may, before taking any legal proceedings, convene a meeting of Debentures (Series D) holders in order for the Holders to decide which proceedings to take to exercise their rights under this Deed, 62 1614780295.2 in an ordinary decision. Additionally, the Trustee may also again convene meetings of the Debentures (Series D) holders for the receipt of instructions with respect to managing the proceedings as stated, in an ordinary resolution, provided that convening the meeting takes place on the first possible date under the provisions of the Second Schedule of the Deed of Trust and the delay of proceedings does not risk the rights of the Holders 10. Receipts held in Trust All the funds held by the Trustee, except for its fees, expenses, and repayment of any debt to it, in any way whatsoever, including but not only in consequence of declaring the Debentures due and payable, and/or as a result of proceedings instituted by it, if any, against the Company, shall be held by the Trustee in trust and shall be used for such purposes and according to the order of priorities as follows: First – for the settlement of all expenses, payments, levies, and obligations incurred by the Trustee, imposed on it, or caused in the course or in consequence of acts to execute the trust or otherwise, with respect to the terms of the Deed of Trust, including its fee (provided the Trustee does not receive its fee from the Company or from the Debenture Holders). Second – for the payment of any other amount pursuant to the "undertaking to indemnify" (as this term is defined in Section 26.1.6 below); Third – for the payment to the holders of the Debentures (Series D) who incurred payments pursuant to Section 26.4.2 below (first to holders bearing payments as set forth in Section 26.4.2 of the Deed beyond their proportional share in the Debentures, and then to holders bearing payments in proportion to their holdings); The balance will be used, unless decided otherwise, in advance, and in a special resolution concerning Section (a) and (b) only, for such purposes and according to the following priorities: (a) First – to pay to the Debenture Holders the arrears of the interest due to them under the terms of the Debentures (Series D), pari passu and pro rata to the sums of principal payable to each of them, without preference or priority with respect to any of them; (b) Second – to pay to the holders of the Debentures (Series D) the arrears of the principal under the terms of the Debentures pari passu and pro rata to the amount of the principal in arrears payable to each of them, under the terms of the debentures, pari passu and pro rata to the sums of the principal in arrears, owed to them, without preference or priority with respect to any of them; (c) Third – to pay to the holders of the Debentures (Series D) the amounts of the interest owed to them under the terms of the Debentures held by them pari passu, whose payment date has not yet occurred, and pro rata to the sums payable to each of them, without preference as to the time priority of the issuance of the Debentures (Series D) by the Company or otherwise; (d) Fourth – to pay to the holders of the Debentures (Series D) the amounts of the principal owed to them under the terms of the Debentures they 63 1614780295.2 hold, pari passu, which are not yet due, and pro rata to the sums owed to them, without any preference as to the time priority of the issuance of the Debentures (Series D) by the Company or otherwise; (e) The surplus, if any, shall be paid by the Trustee to the Company or its successors, as applicable. Withholding tax will be deducted from the payments to the holders of the Debentures (Series D), to the extent that there is a requirement to deduct withholding tax under any law. It is clarified that if the Company was required to incur any of the expenses but failed to do so, the Trustee shall act to collect said amounts from the Company and if it succeeds in obtaining them, they will be held by it in trust and will be used for the purposes and according to the order of priorities specified in this section. 11. Power to demand payment to the holders through the Trustee The Trustee may instruct the Company to transfer to the Trustee some of the payment which the Company is required to pay the Holders (hereinafter in this section: the "Relevant Payment") for the purpose of financing the proceedings and/or expenses and/or the Trustee's fees pursuant to this Deed (hereinafter in this section: the "Sum of Financing") provided that Company did not bear the Sum of Financing itself and/or deposited the Sum of Financing with the Trustee in advance. The Company shall transfer the Sum of Financing to the Trustee no later than the date of the execution of the Relevant Payment. The Company is not entitled to refuse to act in accordance with said notice and it shall be deemed to have fulfilled its obligations to the Holders if it proves that it has transferred the full Sum of Financing to the Trustee as aforesaid. It should be noted that the financing amount shall only be deducted from the interest payments (and not deducted from the principal). Until no later than four trading days before the record date to perform the Relevant Payment of which the Sum of Financing will be deducted an Immediate Report will be published, detailing the Sum of Financing, its designation, and the updated interest sums and rates that will be paid to the holders in accordance with the Relevant Payment. In addition, the Company shall specify in the said Immediate Report that the Sum of Financing that will be transferred to the Trustee will be considered as a payment to the Debenture Holders, for all intents and purposes. The Sum of Financing that the Trustee will be allowed to instruct the Company to give over as aforementioned in this section, and provided that there was not prior holders decision with this regard (including decision regarding commencing proceedings and/or taking action for which the Sum of Financing is needed) will be limited at ILS 500,000 (VAT added). 64 1614780295.2 Nothing in the foregoing shall relieve the Company of its obligation to incur the expenses and fees as aforesaid where it is required to incur them under this Deed or pursuant to any law. In addition, nothing in the foregoing shall derogate from the Trustee's duty to act reasonably to obtain the Sum of Financing due to the Holders from the Company. 12. Power to withhold distribution of funds Notwithstanding the provisions of Section 10 above, in the event that the monetary sum obtained in consequence of the institution of proceedings as aforesaid, which at any time is available for distribution, as set out in Section 10 above, is less than ILS 1 million, the Trustee shall not be obligated to distribute same, and it may invest such sum, in whole or in part, in such investments as are permitted. Where such investments, including accruals thereon, together with other funds received by the Trustee, total such amount as is sufficient to pay the aforementioned amount, the Trustee shall pay the same to the Holders in accordance with the order of priorities set out in Section 10 above. In the event that by the earlier of either the date of payment of the interest and/or principal or a reasonable period of time after receipt of the monetary amount, the Trustee does not have a sufficient sum to pay at least ILS 1 million, the Trustee may distribute the funds held by it to the Debenture Holders. Notwithstanding the foregoing in this Section 12 above, the holders of the Debentures (Series D), according to the resolution adopted by them, may instruct the Trustee to pay them the distributable funds obtained by the Trustee as set forth in Section 10 above, even if the sum total is less than ILS 1 million even if the time for payment of principal and/or interest has not arrived under the terms of the Debentures, subject to the provisions of the TASE Regulations and its guidelines as shall be in effect at the time. Notwithstanding the foregoing, the Trustee's fees and the Trustee's expenses will be paid from the said funds when they become due (with respect to the expenses already paid to the Trustee, the Trustee will be reimbursed for said expenses immediately when the funds are obtained by the Trustee) even if the amounts obtained by the Trustee are less than ILS 1 million. 13. Notice of distribution The Trustee shall give notice to the holders of the Debentures (Series D) of the date and the place of effecting any payment of the installments set out in Sections 10 and 12 above, in a prior 14 days' notice to be delivered to them in the manner designated in Section 27 below. After the date designated in the notice, the holders of the Debentures (Series D) shall be entitled to interest thereon at the rate designated in the Debentures, only in respect of the outstanding balance of the principal (if any), after deduction of the amount paid, as aforesaid.

---

65 1614780295.2 14. Failure to pay for reasons out of the Company's control 14.1. Any amount due to the holders of the Debentures (Series D) which was not paid on the date prescribed for its payment, for a reason that is out of the Company's control, while the Company was willing and able to pay said amount in full and on time (hereinafter: the "Impediment", shall cease to bear interest from the date designated for its payment and the holders of the Debentures (Series D) will only be entitled to the amount he was entitled to on the date prescribed for repayment thereof on account of the principal or the interest. 14.2. The Company shall deposit with the Trustee, on the earliest possible date after the date designated for payment and no later than 14 days of the date designated for payment, the sum of the installment not paid in a timely fashion, as set out in Section 14.1 above, and shall give notice in writing according to the addresses available to it, if any, to the holders of the Debentures (Series D), of such deposit, and such deposit shall be deemed as settlement of such installment, and, in the event of settlement of everything owing for the Debenture, also as redemption of the Debentures (Series D) by the Company. The above will not derogate from the Company's obligations to bear the fees and expenses of the Trustee, all in accordance with the provisions of this Deed. 14.3. Any amount held by the Trustee in trust for the holders shall be deposited by the Trustee in a bank and held by it, in its name or on its behalf, at its discretion, in permitted investments as set forth in Section 17 below. If the Trustee did same it will owe the holders, in respect of said amounts, only the proceeds from the disposal of the investments less the expenses related to said investments, including for the management of the Interest Cushion Account and less its fees and mandatory payments, and it shall pay same to the holders against such certifications as shall be required by it to its satisfaction. Once the Trustee receives notice from the holder that such Impediment has been lifted, the Trustee shall transfer to the holder all the funds accumulated in the deposit as a result of the disposal of the investment, net of all the reasonable expenses including the Interest Cushion Account management fees and net of its fees and any applicable tax under the law. Payment shall be affected against the presentation of certifications, which are acceptable by the Trustee, regarding the holder's right to receipt thereof. 14.4. The Trustee shall hold such funds and shall invest them according to the provisions of Section 17 below, up to the end of one year from the final settlement date of the Debentures (Series D). After such date, the Trustee shall return such amounts to the Company, including profits arising from 66 1614780295.2 their investment, less its reasonable expenses and less its fees and other expenses which were expended in accordance with the provisions of this Deed (such as payment to service providers, etc.), and the Company shall hold such amounts in trust for the holders of the Debentures (Series D) that are entitled to such sum for a period of up to seven (7) years from the date of final repayment of the Debentures (Series D), and with respect to the sums transferred to it by the Trustee, as aforesaid, the provisions of Subsection 14.3 above shall apply to it, mutatis mutandis. Funds that are not claimed from the Company by the holders of the Debentures (Series D) at the end of seven years (7) from the date of final repayment of Debentures (Series D), shall be transferred to the Company's possession, after 30 days from the date of delivering a written notice to the said holders by the Company, according to the addresses in its possession, if any, and it may use the remaining funds for any purpose whatsoever, all in accordance with the statutes of limitation. As soon as the amounts as returned to the Company the Trustee will not owe the holders of the Debentures (Series D) any payment in respect of the amounts held by it as aforesaid. 14.5. The Company shall confirm to the Trustee, in writing, the return of the amounts as stated in Section 14.4 above and the receipt thereof on behalf of the holders of the Debentures (Series D), and shall indemnify the Trustee for any claim and/or expense and/or damage of any type whatsoever incurred by it, in consequence of, and due to, the transfer of the funds as aforesaid, unless the Trustee has acted negligently, in bad faith or maliciously. 15. Receipt from the Debenture Holders and from the Trustee 15.1. A receipt from a holder of the Debentures (Series D) or written confirmation by the TASE member of the transfer or a transfer via the Exchange's clearinghouse of amounts due for the principal and the interest paid to him by the Trustee, in connection with the Debenture, shall serve as absolute exemption of the Trustee in connection with the performance of the payment of the sums designated in the receipt. 15.2. A receipt from the Trustee as to the deposit of the amounts of the principal and the interest with it, for the benefit of the holders of the Debentures (Series D), shall be deemed as a receipt from the holders of the Debentures (Series D) for purposes of the provisions of Section 15.1 above, with respect to the exemption of the Company in connection with the performance of the payment of the sums designated in the receipt. 67 1614780295.2 15.3. Funds distributed as aforesaid in Sections 10 and 12 above, shall be deemed as payment on account of the repayment of the Debentures (Series D). 16. Presentation of a Debenture to the Trustee; Registration with respect to partial payment 16.1. The Trustee is entitled to request the holders of the Debentures (Series D) to present, to the Trustee, upon the payment of any interest or partial payment of principal and interest, the Debenture certificates (Series D) in respect of which the payments are made. The holder of the Debenture (Series D) will be required to present said Debenture certificate provided this will not obligate the holders of the Debentures (Series D) to incur any payment and/or expenses and/or impose any responsibility and/or liability on the holders of the Debentures (Series D). 16.2. The Trustee may register, in the Debenture (Series D) certificate, a note with respect to the sums paid as aforesaid and as to the date of payment thereof. 16.3. The Trustee may, in any special case, at its discretion, waive the presentation of a debenture certificate (Series D), after an indemnity undertaking and/or sufficient security, to its satisfaction, has been given to it by the holders of the Debentures (Series D), for damages liable to be caused due to failure to register such note, all as it deems fit. 16.4. Notwithstanding the aforesaid, the Trustee may, at its discretion, keep records in any other manner, with respect to such partial payments. 17. Investment of Funds All funds which the Trustee may invest under this Deed of Trust, shall be invested by it, in accounts of one of the four leading banks in Israel, provided the bank's rating does not drop below AA, in its name or to its order, provided it invests the funds in bank deposits, treasury bills issued by the Bank of Israel and/or government bonds issued by the Bank of Israel. If the Trustee did same it will owe the holders, in respect of said amounts, only the proceeds from the disposal of the investments less its fees and expenses, less the fees and expenses related to the said investment and the management of the trust accounts and less the mandatory payments that apply to the Trust Account, and with respect to the remainder of said funds, the Trustee shall act in accordance with the provisions of Sections 12 and/or 14 above, as the case may be. 18. The Company's undertakings to the Trustee 68 1614780295.2 The Company hereby undertakes to the Trustee, and the Debenture Holders so long as the Debentures (Series D) have not been repaid in full, as follows: 18.1. To continue to conduct the Company's business in an efficient and appropriate manner. 18.2. To maintain orderly books of account in accordance with accepted accounting principles, to maintain the books and documents used as their references (including deeds of pledge, mortgage, accounts, and receipts) in its offices, and to allow the Trustee and any authorized representative of the Trustee to review, no later than 5 business days from the date of request of the Trustee, to be coordinated in advance with the Company, any book and/or document, as aforesaid, which the Trustee requests to review. In this context, an authorized representative of the Trustee means a person designated by the Trustee for the purpose of such review, by means of a written notice on the part of the Trustee, to be given to the Company prior to the review as aforesaid, subject to an undertaking of confidentiality as specified in the provisions of Section 31.12 below. To the extent possible, considering the nature and circumstances of the matter, the Company shall act to enable the right of inspection, as stated in this section above, in Israel, including the transfer of materials via any medium 18.3. To notify the Trustee in writing, as soon as reasonably possible, and no later than one business day after learning, of any event of imposition of an attachment and/or an execution action carried out on a Material Property of the Company(as this term is defined in Section 8.1 above), and in the event of appointment of a receiver, a special administrator and/or temporary or permanent liquidator and/or a Trustee for a Material Property of the Company (as this term is defined in Section 8.1 above), a, who were appointed as part of a motion for suspension of proceedings pursuant to Section 350 of the Companies Law and/or any other similar office holder against the Company, and to take, at its expense, all measures required to remove such attachment or to cancel the receivership, liquidation or administration, as the case may be. 18.4. To advise the Trustee in writing, immediately upon the Company learning of, no later than one trading day: (1) the occurrence of any of the events set out in the subsections of Section 8.1 above; (2) probable concern by the Company that one or more of the cases enumerated in the subsections of Section 8.1 above may occur. The provisions of this section and all of its subsections shall be implemented by the Company without taking into account the securities treatment and waiting period set forth in Section 8.1 above, if any.

---

69 1614780295.2 18.5. To deliver to the Trustee a signed written notice by the chief financial officer of the Company, no later than 5 business days from the date of the Trustee's request, of the performance of any payment to the Debenture Holders and the remaining amounts which the Company owes, on that date, to the Debenture Holders, after the performance of the above payment. 18.6. To deliver to the Trustee, immediately upon receipt thereof, any report that it is required to submit to the Securities Authority, an immediate report via the Magna system and any report or information that will be published (in full) by the Company on the Magna system shall be deemed to have been delivered to the Trustee. Notwithstanding the aforesaid, at the Trustee's request, the Company shall deliver to the Trustee a printed copy of the report or information as aforesaid. 18.7. To deliver to the Trustee copies of notices and invitations issued by the Company to Debenture Holders, as stated in Section 27 of this Deed. 18.8. To cause the chief financial officer of the Company to provide the Trustee and/or such persons as he may instruct, not later than 10 business days of the demand of the Trustee, any explanation, document, calculation or information regarding the Company, its business and/or assets, which shall be reasonably required, at the Trustee's discretion, for the purpose of reviews conducted by the Trustee to protect the Debenture Holders. 18.9. To invite the Trustee to attend general meetings (whether annual general meetings or extraordinary general meetings of shareholders of the Company) of shareholders of the Company (with no participation or voting rights) that shall take place in Israel (if at all). The publication of an invitation to a general meeting of shareholders of the Company via the Magna system shall be deemed as invitation of the Trustee for purposes of this section. For as long as the Company is a debenture company as defined in the Companies Law - to provide the Trustee with signed minutes of shareholders meetings within one business day of the date of signing said minutes. 18.10. As long as the Debentures (Series D) have not been repaid in full, to provide the Trustee with the following reports: 18.10.1.1. Audited annual financial statements of the Company, and reviewed quarterly financial statements of the Company, no later than the dates designated therefor in accordance with the Securities Law, even if the Company ceased to be a Reporting Corporation. 18.10.1.2. If and as long as the Company is a public company, as it is defined in the Companies Law – a copy of each document 70 1614780295.2 transmitted by the Company to its shareholders or to the Debentures Holders and details of any information transmitted to them by the Company by other means, including any report submitted by law to the Securities Authority (immediate reports), immediately upon its publication. As long as the Company is a private company that is a debenture company – to provide the Trustee with a copy of each document transmitted by the Company to the Debentures Holders and details of any information transmitted to them by the Company by other means, including any report submitted by law to the Securities Authority (immediate reports), immediately upon its publication. 18.10.1.3. To provide the Trustee, at its first written request, with written confirmation signed by an accountant that the payments to the debenture holders were made on time, and the balance of the par value of the Debentures in circulation. 18.10.1.4. If the Company ceased to be a Reporting Corporation, the Company shall provide with the Trustee, in addition to the provisions of Sections 18.3 to 18.10 above and Section 18.11 below, annual, quarterly and immediate reports, as specified below, signed by the CEO and the Chief Financial Officer of the Company, as well as additional reports as such are required in accordance with the provisions of the Consolidated Circular, as the case may be: (a) An annual report that includes the information specified in Appendix 5.2.4.8 to Chapter 4 of Part II (Management of Investment Assets and Provision of Credit) Title 5 (Principles of Business Management) of the Consolidated Circular, no later than 60 days from the date in which the Company would have been required to publish its financial statements had it been a Reporting Corporation; (b) A quarterly report that includes the information specified in Appendix 5.2.4.9 to Chapter 4 of Part II (Management of Investment Assets and Provision of Credit) Title 5 (Principles of Business Management) of the Consolidated Circular no later than 30 days from the date in which the Company would have been required to publish its financial statements had it been a Reporting Corporation; 71 1614780295.2 (c) An immediate report upon the occurrence of any of the events specified in Appendix 5.2.4.10 to Chapter 4 of Part II (Management of Investment Assets and Provision of Credit) Title 5 (Principles of Business Management) of the Consolidated Circular. The report will be published on the date in which the Company would have been required to report the event pursuant to Regulation 30(B) of the Reports Regulations or any regulation that replaces it. 18.11. To deliver to the Trustee, upon his request, a declaration and/or declarations and/or documents and/or details and/or additional information on the Company (including explanations, documents, and calculations regarding the Company, its business or assets) and to instruct its accountant and its legal consultants to do same, upon reasonable request in writing by the Trustee, and this - no later than 10 business days from the date of request by the Trustee, if, in the Trustee's reasonable opinion, the information is required by the Trustee to exercise the powers and authority of the Trustee and/or his representative under the Deed of Trust, including information that could be essential in protecting the rights of the Debenture Holders provided the Trustee acted in good faith, and subject to the confidentiality undertaking, as stated in Section 31.12 below. 18.12. To deliver to the Trustee all the reports or notices as specified in Section 35J of the Law. 18.13. No later than 7 business days after the publication of the Company's annual or quarterly financial statements, as the case may be, the Company shall furnish to the Trustee a written detailed confirmation, worded in a manner that will satisfy his request, signed by the chief financial officer, with the addition of an active Excel file, regarding the Company's compliance or noncompliance with any of the Financial Covenants set forth in Section 6.4 of this Deed, together, with the detailed relevant calculation in connection with each financial covenant. 18.14. No later than 7 business days after the publication of the Company's quarterly financial statements, and as long as this Deed of Trust is in effect, the Company shall furnish to the Trustee, a written confirmation by the Company, signed by authorized signatories on its behalf as well as its Chairman of the Board of Directors and/or general manager, that during the period from the date of the Deed and/or the date of the previous confirmation delivered to the Trustee, whichever is later, and until the date of the confirmation, the Company was not in violation of this Deed and the terms of the Debentures (Series D), unless it expressly states otherwise. 72 1614780295.2 18.15. On April 10 of each year, for the previous calendar year, and as long as this Deed of Trust is in effect, the Company shall deliver to the Trustee, a written confirmation signed by the chief financial officer of the Company with regard to interest payments and/or payments on account of the principal, in connection with the Debentures (Series D), which became due prior to the date of confirmation, and the date of payment, and the balance of nominal value of outstanding Debentures (Series D) as of the date of confirmation; as well as confirmation by a director of the Company and by its general manager, that on the year ended December 31 the Company was not in breach of the terms and restrictions stipulated in the Deed of Trust (including specific terms and restrictions in the Deed and in the Debentures, which the Trustee shall ask the Company to address in the confirmation), unless expressly stated otherwise in the said confirmation. 18.16. Inform the Trustee in writing of any change in its name or address, no later than two trading days from date of the implementation of the change. It is clarified that reporting via MAGNA system will constitute a reporting to the Trustee, for the purposes of this section. 18.17. The Trustee may instruct the Company to report forthwith on the Magna system, in the Trustee's name, any report the wording of which shall be delivered in writing by the Trustee to the Company, and the Company shall be obligated to report the same forthwith. 18.18. The Trustee will keep in confidence all information provided thereto under this section, will not disclose it to another and will not make any use thereof, unless its disclosure or use is required for the purpose of fulfilling its role as Trustee according to the Law, according to the Deed of Trust, or according to a court order, or for protection of the rights of the Debenture Holders 18.19. The Company shall notify the Trustee of non-compliance with any foreign covenant as soon as possible and no later than 2 business days from the day in which the Company's non-compliance with the foreign covenant began or within 2 business days from the date on which it was notified by an affiliated or consolidated company, as the case may be, of the non-compliance with any foreign covenant, as the case may be, and the expected repercussions of such non-compliance pursuant to the Company's agreements with such entity. It is clarified that if the Company fails to comply with a foreign covenant and a grace period is provided for the purpose of compliance with the foreign covenant, such grace period shall not be deemed, for purposes of this section only, as compliance with the covenant and the Company shall notify the Trustee of non-compliance with the foreign covenant as aforesaid.

---

73 1614780295.2 For purposes of this section – "Foreign covenant" – a material financial covenant of the Company and of an affiliated or consolidated company of the Company, pursuant to an agreement with a financial institution or with another entity that provided material credit to the Company or to the affiliated or consolidated company of the Company. "Material financial covenant" – a financial covenant in respect of which non-compliance constitutes grounds for declaring the debt due and payable. "Material credit" – credit that constitutes at least 10% of the total of the Equity Capital of the Company (including minority interest). For the purposes of an affiliated or consolidated company – credit, the amount of which multiplied by the Company's percentage holding (through a chain of holdings) of the affiliated or consolidated company constitutes at least 10% of the Company's consolidated Equity Capital (including minority interests). Notwithstanding the provisions of Section 27 below, the Company shall give the Trustee written notice of non-compliance with the foreign covenant in addition to any immediate report that the Company will publish on the matter, if any. 18.20. The Company undertakes to provide to the Trustee the following authorizations, as applicable: 18.20.1 Regarding Section 3.2 above: If an Associated Person (as defined in Section 3.2 above) should purchase and/or sell Company debentures, the Company shall deliver to the Trustee, on demand, the list of Associated Persons and the quantities held thereby on the date on which the Trustee requests it, in accordance with the reports received, as mentioned above, from Associated Persons, and that have been reported in the MAGNA system by the Company. It is clarified that reporting in the MAGNA system shall constitute a report to the Trustee, for the purpose of this Section. 18.20.2 With respect to the authorizations required for the Expansion of a Series or the issuance of a new series, see Section 4.3 and 4.11 above. 18.20.3 No later than 15 days after the date of issuance of Debenture (Series D) in accordance with the Shelf Prospectus report and/or after the date of Series Expansion, the Company shall provide the Trustee with a true certified copy of the Debenture Certificate. 74 1614780295.2 18.20.4 With respect to the authorizations required to make a distribution, see Section 5.9 above. 18.20.5 For the purpose of Section 6.2.4 above: the Company will provide the Trustee no later than 5 days after signing this Deed with the opinion of an attorney specializing in the laws of the British Virgin Islands applicable to the Company, in accordance with which there is no legal obligation in the British Virgin Islands to record a negative pledge as specified in Section 6.2 above in accordance with the laws of the British Virgin Islands. the Company will provide the Trustee, on January 31 of each year, with an authorization from an attorney specializing in the relevant law applicable to the Company, in accordance with which as at the date of December 31 of the ending calendar year, the Company did not record in the registers thereof and/or any other registry conducted under the relevant law, any pledge in favor of a party contrary to its undertaking thereof in Section 6.2.1 above. To the authorization of the attorney shall be attached a certificate from the register conducted in this matter in accordance with the law applicable to the Company. 18.20.6 With respect to Section 6.5 above: the Company will provide the Trustee with approval from the senior office holder in the Company's financial department, at the end of April of each year, that the Company has complied with its liabilities under Section 6.5 above regarding taking credit from non-Israeli financial institutes. 18.20.7 With respect to Section 6.3 above: the Company shall provide the Trustee with authorization from the senior financial officer in the Company, together with the relevant calculations in an active Excel file, with respect to the compliance with the financial covenants in Section 6.3 above, no later than 7 business days from the date of publication of the financial statements of the Company. The Company undertakes to inform the Trustee and the holders of the Company's Debentures (Series D) regarding any breach of liability to any financial creditor, and it shall not constitute grounds for immediate repayment, without derogating from the provisions of Section 8.1 above. 19. Additional undertakings 75 1614780295.2 19.1. To the extent that the Debentures are declared due and payable, as defined in Section 8 above, the Company shall perform, from time to time and any time it is required by the Trustee, all the reasonable acts to enable the exercise of the powers vested in the Trustee, and in particular, the Company shall take the following actions, no later than seven business days from the date of request by the Trustee: 19.1.1. To pay the Debenture Holders and the Trustee all of the amounts owed to them under the terms of the Deed of Trust, whether the charge date for them has transpired or otherwise ("acceleration"), within seven days from the date of notice of the Trustee to the Company., subject to coordination with TASE of timetables for payments to the holders of Debentures (Series D) of the Company. 19.1.2. Make the statements and/or sign all the documents and/or execute and/or cause the execution of all the necessary or required actions by law, in order to validate the exercise of the powers and authority of the Trustee and/or its representative under this Deed of Trust. 19.1.3. Give all the notices, instructions and orders that the Trustee considers beneficial and requires the same for the purpose of implementing the provisions of the Deed of Trust. 19.2. For purposes of this section – a signed written notice by the Trustee, confirming that an action required by it, within its powers, is a reasonable action, shall constitute prima facie evidence. 20. Agents 20.1. The Company hereby irrevocably appoints the Trustee as its agent, to execute and carry out in its name and in its stead, all the actions that it will be required to carry out under the terms of this Deed, and in general to act in its name in relation to the actions that the Company is obligated to carry out under this Deed and has not carried out or to exercise some of the powers it holds, and to appoint any other person as the Trustee deems fit to perform its duties under this Deed, provided the Company has not carried out the actions it is required to carry out under the terms of this Deed within a reasonable period of time as determined by the Trustee, as of the date of the Trustee's instruction, and provided it acted reasonably. 20.2. An appointment as stated in Section 20.1 above shall not obligate the Trustee to take any action and the Company hereby exempts the Trustee and its representatives in the event that they do not take any action, and 76 1614780295.2 the Company hereby waives any claim toward the Trustee and its representatives in respect of any damage that was incurred or may be incurred to the Company directly or indirectly, in respect of that, on the basis of any action that was not taken by the Trustee and its representatives as aforesaid. 21. Other Agreements Subject to the provisions of the Law and the restrictions imposed on the Trustee under the law, the fulfillment of its role as Trustee, under this Deed, or its very status as Trustee, shall not prevent the Trustee from entering into various agreements with the Company, or entering into transactions with the Company in the ordinary course of its business. It should be noted that the Trustee will not be able to enter into an agreement with the Company as aforesaid if this creates a conflict of interest with its tenure as Trustee for the Debenture (Series D) Holders. 22. Trusteeship reports 22.1. The Trustee shall be required to submit a report with regard to the acts performed by it in accordance with the provisions of Section 35H (1) of the Securities Law. 22.2. Until June 30 of each year the Trustee shall prepare an annual report on trust affairs (hereinafter: "the Annual Reports"). The annual report shall include a report of irregular events in connection with the Trusteeship that occurred in the past year. 22.3. The Trustee will publish (itself or through the Company at the Trustee's request) the annual report on the Magna system. 22.4. If the Trustee learns of a material breach of the terms of this Deed and/or the terms of the Debentures (Series D) of the Company, on the part of the Company, as from public reports issued by the Company or the Company's notice to the Trustee pursuant to Section 18.4 above, it will notify the holders of the Debentures (Series D) of such breach and the steps taken by the Trustee to prevent it or to enforce the Company's compliance with the obligations, as the case may be. Such duty shall not apply if this is an event that was published by the Company under the law. Such duty of the Trustee is subject to its knowledge of the said breach. 22.5. Upon the request of the Holders of over five percent (5%) of the balance of the par value of the Debentures (Series D), the Trustee will deliver to the Holders data and details with respect to the expenses thereof in connection with the trust at the subject of the Deed of Trust.

---

77 1614780295.2 22.6. The Trustee will be obliged to submit a report of the activities it has performed under the provisions of Chapter E1 of the law by a reasonable request of the holders of at least ten percent (10%) of the outstanding nominal balance of the Debentures within a reasonable time from the date of the request, subject to the confidentiality undertakings of the Trustee to the Company as specified in Article 35j (D) of the Law. 22.7. As of the signing of this Deed, the Trustee declares that it is insured with professional liability insurance in the amount of USD 10 million8 for the period (hereinafter: the "Coverage Amount"). If before the full payment of the Debentures (Series D), the coverage amount is reduced from the amount of USD 8 million8 for any reason, the Trustee will update the Company no later than seven business days from the date on which it was made aware of the said reduction from the insurer in order to publish an immediate report on the matter. The provisions of this section will apply by the date of the entry into force of the Regulations to the Securities Law that address the obligation for the Trustee's insurance coverage. After the entry to force of the Regulations as stated, the Trustee will be required to update the Company only in the case in which the Trustee does not meet the requirements of the Regulations. 22.8. The Trustee will update the Company of any report submitted under this Section 22, inasmuch as this does not harm the holders' rights. 23. Remuneration of the Trustee and reimbursement of its expenses The Company shall pay the Trustee a fee as specified in Appendix 23 of this Deed. 24. Special powers 24.1. The Trustee will be entitled to deposit all the deeds and documents which evidence, represent and/or specify its right under this Deed including in connection with any asset held by it at the time, in a safe and/or at another place it may choose, with any banker and/or bank and/or with an attorney. 24.2. The Trustee may, as part of the execution of the Trust affairs under this Deed, to enlist the opinion and/or advice of any attorney, accountant, appraiser, assessor, surveyor, mediator or other specialist (hereinafter: "the Consultants") and to act in accordance with its conclusions, whether such opinion or advice has been prepared at the request of the Trustee and/or at the Company, and the Trustee shall not be responsible 8 As of the policy renewal date. 78 1614780295.2 for any loss or damage caused in consequence of any act and/or omission performed by it, on the basis of such advice or opinion, unless a peremptory judgment has determined that the Trustee has acted with gross negligence and/or in bad faith and/or maliciously. The Company shall incur the expenses of employing the Consultants who are appointed as aforesaid, provided, insofar as necessary under the circumstances of the matter and to the extent that this shall not prejudice the rights of the holders, that the Trustee gives the Company prior notice of its intent to obtain such expert opinion or advice. 24.3. Any such advice and/or opinion may be given, forwarded or received by means of a letter, telegram, facsimile and/or any other electronic means for transmission of information, and the Trustee shall not be responsible for any acts performed by it on the basis of any advice and/or opinion and/or information transmitted in one of the aforesaid manners, notwithstanding that it contained errors and/or was not authentic, unless such errors could have been detected under a reasonable examination. 24.4. Subject to any law, the Trustee shall not be obligated to inform any party of the signing of the Deed of Trust and may not intervene in any way whatsoever in the management of the Company or its affairs, unless it is pursuant to the authority vested in the Trustee under this Deed. Nothing stated in this section shall limit the Trustee in the actions it is required to perform under the Deed of Trust. 24.5. The Trustee shall use the trust, powers, authorizations, and authorities conferred on it under this Deed, at its absolute discretion and subject to the other provisions of this Deed. In doing so, it shall not be responsible for any damage and/or loss and/or expense caused to the Company and/or the Debenture Holders and/or which they will have to incur in consequence of any act and/or omission performed by the Trustee, including as a result of errors in judgment, unless a peremptory judgment has determined that the Trustee has acted with negligence or in bad faith or maliciously or in violation of the provisions of this Deed, all subject to and in accordance with the statutory provisions. 24.6. Unless explicitly set forth otherwise in the Law or the provisions of this Deed of Trust, the Trustee is not required to act in a manner which is not expressly detailed in this Deed of Trust so that any information, including about the Company and/or in connection with the Company's ability to meet its obligations to debenture holders, comes to its attention, and this is not its role. 25. The Trustee's power to engage agents 79 1614780295.2 The Trustee may, as part of the management of trust affairs, appoint an attorney or other agent/s to act in its stead, inasmuch it shall not harm the rights of the Debentures (Series D) Holders, in order to perform or participate in the performance of special acts to be performed with respect to the trust and pay a fee to any such agent, and, without derogating from the generality of the foregoing, institution of legal proceedings. The Trustee shall also be entitled to pay, at the Company's expense, the fees of any such agent including by deducting the payment from the funds received by it and the Company shall reimburse the Trustee immediately upon its first request for any such expense, all provided the Trustee gave the Company advance notice regarding the appointment of agents as aforesaid insofar as it is possible under the circumstances and to the extent that this will not prejudice the rights of the holders. It is clarified that the appointment of said agent shall not release the Trustee from any responsibility for its actions and for the actions of its agents. 26. Indemnification of the Trustee 26.1. The Company and the debenture holders (on the relevant effective date as provided in Section 26.6 of the Deed of Trust, each in respect of their undertaking as provided in Section 26.4 of the Deed of Trust) hereby undertake to indemnify the Trustee and all its officers, employees and any proxy or expert who appoints or will be appointed by the Trustee as per the provisions of this Deed of Trust and/or per resolution made in the meeting of the Debentures (Series D) holders, based on the provisions of this Deed of Trust (hereinafter: "parties entitled to indemnification"): 26.1.1. For any damage and/or loss and/or for any monetary charge under any judgment (for which no stay of execution was granted) or under any completed settlement (and insofar as the settlement relates to the Company, the Company gave its agreement thereto), arising from actions that were performed by the parties entitled to indemnification or which they are required to perform under the provisions of this Deed and/or by law and/or by order of a competent authority and/or in accordance with any statute and/or upon the demand of the holders of Debentures (Series D) and/or upon the Company's demand and/or under their role according to this Deed; and 26.1.2. For the fee of the parties entitled to indemnification and expenses which they incurred and/or are about to incur, and for any damage and/or loss caused to them due to actions which they performed or are required to perform under the provisions of this Deed and/or by law and/or by order of a competent 80 1614780295.2 authority and/or in accordance with any statute and/or upon the demand of the holders of Debentures (Series D) and/or upon the Company's demand and/or in connection with the exercise of powers and authorizations conferred by this Deed and in connection with all kinds of legal proceedings, opinions of lawyers and other experts, negotiations, discussions, expenses, claims and demands relating to any matter and/or thing done and/or not done in any way in connection with the subject matter hereof and/or under their role according to this Deed. All the above on condition that: 26.1.3. The parties entitled to indemnification do not demand to be indemnified in advance in a matter that cannot be delayed (without prejudice to their right to retroactive indemnification); 26.1.4. It was not determined in a peremptory rule that the parties entitled to indemnification acted in bad faith and the action was done outside the framework of their duties, not in accordance with the statutory provisions and/or not in accordance with this Deed of Trust; 26.1.5. It was not determined in a peremptory rule that the parties entitled to indemnification were negligent; 26.1.6. It was not determined in a peremptory rule that the parties entitled to indemnification acted maliciously; The indemnification rights under this Section 26.1 are hereinafter referred to as the "Indemnification Right" Or the "Indemnification Undertaking". It is agreed that in the event it is alleged against the parties entitled to indemnification that they are for any reason whatsoever not entitled to indemnification, those entitled to indemnification would be due, immediately upon their initial demand, payment of the amount due to them with regard to the indemnification undertaking. Should a final judicial ruling find that no right to indemnification has developed for those entitled for indemnification, the latter shall reimburse the indemnification funds paid to them. 26.2. Without derogating from the compensation rights granted to the Trustee by law and subject to the provisions of this Deed and/or the Company's obligations under this Deed, the parties entitled to indemnification may be indemnified out of the monies received by the Trustee from proceedings instituted by it, with respect to obligations which they assumed, with respect to reasonable expenses which they incurred in

---

81 1614780295.2 connection with the performance of the trust or in connection with such actions as in their opinion were required for said performance and/or in connection with the exercise of the powers and authorizations conferred by this Deed and in connection with all kinds of legal proceedings, opinions of lawyers and other experts, negotiations, discussions, claims and demands relating to any matter and/or thing done and/or not done in any way in connection with the subject matter hereof, and the Trustee may withhold the monies held by it and pay out of them the amounts necessary for the payment of such indemnification. All the above amounts shall have priority over the rights of the holders of Debentures (Series D), subject to any statutory provisions and provided that the Trustee acted in good faith and in accordance with the duties imposed on it by any statute and by this Deed. For purposes of this section, an action of the Trustee that was approved by the Company and/or the debenture holders shall be deemed an action that was reasonably required. 26.3. Without derogating from the validity of the indemnification undertaking in Section 26.1 above, where the Trustee is obligated by the terms of the Deed of Trust and/or by law and/or by order of a competent authority and/or in accordance with any statute and/or upon the demand of the holders of Debentures (Series D) and/or upon the Company's demand to do any action, including but not limited to the institution of proceedings or the filing of claims upon the demand of the holders of Debentures (Series D), the Trustee may abstain from taking any such action until it receives from the Company, to its satisfaction, a monetary deposit in the amount required to cover the indemnification undertaking (hereinafter: "the financing cushion"), with first priority, and in the event that the Company does not deposit the full amount of the financing cushion within the time it was required to do so by the Trustee, the Trustee shall address to the holders of Debentures (Series D) which held Debentures (Series D) on the effective date (as provided in Section 26.6 below) a request to deposit the financing cushion with it, each according to their proportionate share (as this term is defined hereinafter). If the holders of Debentures (Series D) do not actually deposit the full amount of the required financing cushion, the Trustee shall not be obligated to take the relevant action or institute the relevant proceedings. The foregoing shall not exempt the Trustee from taking any urgent action required to prevent material harm to the rights of the holders of Debentures (Series D). The Trustee is authorized to determine the amount of the financing cushion, and it shall be entitled to act again to create an additional financing cushion, from time to time, in an amount to be determined by it. It is clarified that the payment by the holders under this section will 82 1614780295.2 not release the Company from its obligation to bear the aforesaid payment. The Trustee, at its sole discretion, may make use of the funds deposited in the Financing Cushion for the execution of actions or use of relevant proceedings. 26.4. The indemnification undertaking: 26.4.1. Shall apply to the Company in case of: (1) actions that were performed according to the Trustee's judgment and/or in accordance with any statute and/or that were required to be performed under the terms of this Deed of Trust or for protecting the rights of the debenture holders (including due to a holder's demand required for such protection) and/or if the indemnification right arose by virtue of this Deed; and (2) actions that were performed and/or that were required to be performed upon the Company's demand. 26.4.2. Shall apply to holders on the effective date (as provided in Section 26.6 of the Deed of Trust) in case of: (1) the indemnification right arose as per the demand of the Debenture Holders (excluding an indemnification right arising from the demand of the Holders for the protection of the Debenture Holders' rights); and (2) nonpayment by the Company of the amount of the indemnification right due from it under Section 26.3 of the Deed of Trust (subject to the provisions of Section 26.6 of the Deed of Trust) provided the persons entitled to indemnification have taken the reasonable steps given the circumstances required for the collection of the said amounts from the Company. It is clarified that payment in accordance with this subsection (2) above shall not derogate from the Company's obligation to bear the indemnification undertaking in accordance with the provisions of Section 26.4.1. 26.5. If the Company fails to pay the full amount required to cover the indemnification undertaking, and/or does not deposit the full amount of the financing cushion, as the case may be, and/or if the indemnification obligation applies to the holders by virtue of the provisions of Section 26.4.2 above, and/or if the holders were called upon to deposit the amount of the financing cushion under Section 26.3 above, provided the persons entitled to indemnification have taken the reasonable steps given the circumstances required for the collection of the said amounts from the Company, the following provisions shall apply: 26.5.1. The monies shall be collected in the following manner: 83 1614780295.2 26.5.1.1 First – The amount shall be financed out of the amounts of interest and if the funds of the interest from the principal which the Company is required to pay to the holders of Debentures (Series D) after the date of the required action will not be sufficient, and the provisions of Section 11 above shall apply (where should the amount also be financed using the principal funds, then as part of disclosing the financing amount, as defined above, Company shall also announce the amount due for each ILS 1, nominal value, net of the financing amount); 26.5.1.2 Second – If in the Trustee's opinion the amounts deposited in the financing cushion are not enough to cover the indemnification undertaking, the holders on the effective date (as provided in Section 26.6 above) shall deposit, each according to their proportionate share (as this term is defined) the missing amount with the Trustee. "Proportionate share" means: The proportion of the Debentures (Series D) held by the holder on the relevant effective date as provided in Section 26.6 above out of the nominal amount in circulation on that date. It is clarified that the calculation of the proportionate share shall remain fixed even if after that date there is a change in the par value of the Debentures held by the holder. It is clarified that the debenture holders who are liable to cover expenses as provided in this section above, may bear expenses as provided in this section above, beyond their proportionate share, and in such case, the order of priorities as provided in Section 10 of this Deed shall apply to the reimbursement of the amounts. 26.6. The effective date for determining the obligation of a holder in respect of the indemnification undertaking and/or payment of the financing cushion is as follows: 26.6.1. If the indemnification undertaking and/or payment of the financing cushion is required pursuant to a resolution or an urgent action necessary to prevent material harm to the rights of the holders of Debentures (Series D), without a prior resolution of the meeting of holders of Debentures (Series D) – the effective date for the obligation shall be the end of the trading day on the day when the action was taken or the 84 1614780295.2 resolution was adopted, and if that day is not a trading day, then the previous trading day. 26.6.2. If the indemnification undertaking and/or payment of the financing cushion are required pursuant to a resolution of a meeting of holders of Debentures (Series D) – the effective date for the obligation shall be the effective date for participation in the meeting (as such date was specified in the notice of invitation) and shall also apply to a Holder who has not participated in the meeting. 26.7. The payment by the holders in place of the Company of any amount that is due from the Company under this Section 26, shall not release the Company from its obligation to bear such payment. The Trustee will act to refund such monies as stated that were paid by the Holders in place of the Company, from the Company. 26.8. Regarding priority in reimbursing holders who bore payments under this section out of the receipts held by the Trustee, see Section 10 above. 27. Notices Any notice by the Company and/or the Trustee to the debenture holders shall be given as follows: 27.1. By reporting on the Magna system of the Securities Authority (the Trustee may instruct the Company and the Company shall be obligated to make immediately on the Magna system, on the Trustee's behalf, any report in the wording provided in writing by the Trustee to the Company); and solely in the cases specified below, in addition, by the publication of a notice in two daily newspapers with a wide distribution published in Hebrew in Israel: (a) any arrangement or settlement under Section 350 of the Companies Law; (b) any merger. Any notice published or sent as stated, shall be deemed to have been delivered to the debenture holders on the day of its publication as stated (on the Magna system or in the press, as the case may be). 27.2. Any notice or demand by the Trustee to the Company or by the Company to the Trustee may be delivered by a letter sent by registered mail to the address specified in the Deed of Trust, or to another address of which one party has notified the other in writing (including an email address), or by sending by fax or by messenger, and any such notice or demand shall be deemed to have been received by the other party: (1) if sent by registered mail – at the end of three business days from the date of its delivery to the Trustee as per the postal records; (2) if sent by fax (together with a telephone verification of receipt) – at the end of one

---

85 1614780295.2 business day from the day of its sending; (3) if sent by messenger – upon its delivery by the messenger at the address or upon its presentation to the addressee for acceptance, as the case may be; (4) and if sent by email – at the end of one business day from the day of its sending. 28. Waiver, settlement and alterations to the Deed of Trust Subject to any statutory provisions, including the articles and instructions of TASE, except with respect to the payments dates and rates pursuant to the terms of the Debentures, the interest rate (including arrears interest), adjustments of interest arising from non-compliance with the financial covenants and a change in rating, undertakings of the Company in connection with the Financial Covenants and their breach, undertakings of the Company in connection with a distribution, undertakings of the Company related to failure to create a floating charge, provisions related to the expansion of a series, provisions related to the law applicable to this Deed, provisions related to the Expenses Cushion, undertaking to appoint a representative in Israel, provisions regarding limitations of executing transactions with controlling shareholders, grounds for calling for immediate repayment, undertaking of a negative pledge, provisions regarding the Expense Cushion, provisions regarding the appointment of a representative in Israel and reports that the Company must provide the Trustee (hereinafter jointly: "Undertakings of the Company that Cannot be Conditioned Upon"), the Trustee may, from time to time and at any time, when the same, in its opinion, does not harm the rights of the debenture holders (Series D), to waive any breach or non-fulfillment of any of the terms of the Debentures or non-fulfillment of any of the terms of the Deed of Trust by the Company. Subject to any statutory provisions, including the articles and instructions of TASE, and with the prior approval of the debenture holders in a special resolution, the Trustee may, whether before or after the principal of the Debentures (Series D) has come due, settle with the Company regarding any right or claim of the holders of Debentures (Series D), waive any right or claim of the holders of Debentures (Series D) or any of them against the Company under the Deed of Trust and the Debentures (Series D), and agree with the Company on any arrangement with respect to their rights, including waiving any right or claim of the holders of the Debentures (Series D), against the Company pursuant to this Deed. If the Trustee settled with the Company, waived any right or claim of the holders of Debentures (Series D) or agreed with the Company on any arrangement with respect to the rights of the holders of Debentures (Series D), after it received the prior approval of the meeting of holders of Debentures (Series D) as provided above, the Trustee shall be exempt from liability in respect of such action, as it was approved by the general meeting, provided the Trustee did not breach its 86 1614780295.2 fiduciary duty and did not act in bad faith or willfully or in negligence in the implementation of the resolution of the general meeting. Without derogating from the foregoing, subject to any statutory provisions, including the articles and instructions of TASE, the Company and the Trustee may, whether before or after the principal of the Debentures has come due, modify the Deed of Trust including its appendices (including an alteration to the terms of the Debentures (Series D), if either of the following is fulfilled: (a) If the Trustee is convinced that the alteration does not harm the debenture holders (except for the Undertakings of the Company that Cannot be Conditioned Upon, as defined in this section above and excluding a change of the identity of the Trustee or its fees in the Deed of Trust, for the appointment of a Trustee in the place of the Trustee whose services has ended – for which the Trustee cannot agree to any changes and/or waive them. (b) The alteration was approved by the holders of Debentures (Series D) in a special resolution. The Company shall deliver to the debenture holders a notice by means of an immediate report via the Securities Authority's Internet site (the Magna system), regarding any alteration as above, immediately after it was made. Whenever the Trustee exercises its right under this section, it may require the holders of Debentures (Series D) to deliver the debenture certificates to it or to the Company for recording therein a caveat regarding any settlement, waiver, alteration or amendment as stated, and the Company shall record such a caveat at the Trustee's request. If the Trustee exercises its right under this section, it shall give the holders of Debentures (Series D) written notice to that effect within a reasonable time. Without derogating from the aforementioned, the terms of the debentures may also be revised as part of a settlement or compromise, approved by a court, pursuant to the Insolvency or Companies Acts. 29. Register of Debenture Holders 29.1. The Company shall maintain and manage at its registered office a register of holders of Debentures (Series D), in accordance with the Securities Law, which shall be open to inspection by any person. 29.2. The Company shall not be obligated to record in the register of holders of Debentures (Series D) any notice concerning an explicit, implicit or presumed trust, or a pledge or charge of any nature and kind, or any equitable right, claim or offset or any other right, in connection with the Debentures (Series D). The Company shall only recognize the title of the 87 1614780295.2 person in whose name the Debentures were registered. The legal heirs, administrators of the estate or executors of the will of the registered owner and any person becoming entitled to Debentures due to the bankruptcy of any registered owner (and in the case of a corporation – due to its liquidation) shall be entitled to be registered as the holder, after producing proofs which in the opinion of the Company's managers suffice to establish his right to be registered as a debenture holder. 30. Release Upon proof to the Trustee's satisfaction that all the Debentures (Series D) were paid or redeemed or upon the Company's depositing in trust with the Trustee amounts sufficient for the full and final redemption of the Debentures in accordance with the provisions of this Deed, and upon proof to the Trustee's satisfaction that its entire fee and all the expenses incurred by the Trustee and/or its proxies in connection with its activity under the Deed of Trust and in accordance with its instructions were fully paid to it, the Trustee shall be obligated, upon the Company's first demand, to act with the monies deposited with it in respect of Debentures (Series D) whose redemption was not demanded in accordance with the terms of this Deed. 31. Appointment of Trustee; Trustee's Duties; Trustee's Powers; Termination of Trustee's Office 31.1. The Company hereby appoints the Trustee as Trustee for the holders of Debentures (Series D) only, pursuant to the provisions of Section 35B of the Securities Law. 31.2. The term of the appointment of the Trustee shall be until the date of convening of a holders' meeting in accordance with the provisions of Section 35B (a1) of the Securities Law. 31.3. From the effective date of this Deed of Trust, the Trustee's duties shall be in accordance with any statute and this Deed. 31.4. The Trustee shall act in accordance with the provisions of the Securities Law. 31.5. The Trustee shall represent the holders of Debentures (Series D) in any matter arising from the Company's obligations towards them, and for this purpose, it may act to realize the rights vested in the holders by law or by the Deed of Trust. 31.6. The Trustee may institute any proceeding to protect the holders' rights in accordance with any statute and the provisions set forth in this Deed of Trust. 88 1614780295.2 31.7. The Trustee may appoint agents as set forth in Section 25 of this Deed. 31.8. The Trustee's actions shall be valid even if a defect is discovered in its appointment or capacity. 31.9. The Trustee's signature on this Deed of Trust does not constitute an expression of its opinion regarding the quality of the offered securities or the profitability of investing in them. 31.10. The Trustee is not obligated to notify any party of the signing of this Deed. The Trustee may not intervene in any way in the management of the Company's business or interests, and this is not included among its duties. Nothing stated in this section shall restrict the Trustee in any action it is required to perform in accordance with the provisions of this Deed. 31.11. Subject to any statutory provisions, the Trustee is not obligated and does not have a responsibility to act in a manner not provided for explicitly in this Deed of Trust, so that any information, including about the Company and/or in connection with the Company's ability to meet its obligations towards the debenture holders, comes to its attention. 31.12. Subject to any statutory provisions and the provisions of this Deed of Trust, by signing this Deed the Trustee undertakes to keep confidential any information provided to it by the Company, not to disclose it to another and not to use it in any way, unless such disclosure or use is required for the fulfillment of its function in accordance with the Securities Law, the Deed of Trust or a court order. Said duty of confidentiality shall also apply to any proxy of the Trustee (including any consultant, representative, etc.). It is clarified that the transfer of information to the debenture holders for the purpose of reaching a decision relating to their rights under the debenture or for the purpose of reporting on the Company's condition does not constitute a violation of said confidentiality undertaking. 31.13. The Trustee is entitled to rely on the framework of its Trusteeship with respect to any written document, including any letter of instruction, notice, request, consent or approval, purporting to be signed or issued by any person or entity who the Trustee believes in good faith to have signed or issued it. 31.14. The provisions of the Securities Law shall apply to the termination of the office of the Trustee. 31.15. Upon the expiration of the office of the Trustee, a new Trustee shall be appointed in its place in the holders' meeting. 31.16. Notwithstanding the foregoing, a holders' resolution to terminate the office of the Trustee and replace it with another Trustee shall be passed

---

89 1614780295.2 at a meeting at which holders of 50% of the nominal value of outstanding Debentures (Series D), or at an adjourned meeting at which holders of at least 10% of such balance are present, by a majority of 75%. 31.17. Subject to any statutory provisions, the Trustee whose office has expired shall continue in office up to the appointment of another Trustee. The Trustee shall transfer to the new Trustee all the documents and amounts that accumulated with it in connection with the trust under the Deed of Trust for Debentures (Series D) and shall sign any document required for this purpose. Any new Trustee shall have the same powers, duties, and authorities and shall be able to act in all respects as if it had been appointed as the Trustee from the outset. 31.18. The Company shall issue an immediate report in the event of the Trustee's resignation and/or the appointment of another Trustee. 31.A. It is hereby clarified that the end of the Trustee's term of office does not derogate from the rights, claims or demands that the Company and/or the holders of Debentures (Series D) will have towards the Trustee, if any, the cause of which is prior to the date of termination of his tenure as trustee, and this does not relieve the Trustee of any liability under any law. Furthermore, the end of the Trustee's term shall not derogate from its rights, claims or assertions that the Trustee may have towards the Company and/or the debenture holders, if any, insofar as the cause thereof occurred prior to the date of termination of the end of his term of office as a Trustee, and this does not release the Company and/or the debenture holders of any liability by virtue of any law. 32. Meetings of Debenture Holders Meetings of holders of Debentures (Series D) shall be conducted as provided in the Second Schedule to this Deed. 33. Governing Law The law governing the Deed of Trust, its additions and its appendices, including the Debentures is the Israeli law. In any matter not referred to in this Deed and in case of a contradiction between the statutory provisions that cannot be conditioned upon and this Deed, the parties shall act in accordance with the provisions of the Israeli law only. 34. Exclusive Jurisdiction The sole court with jurisdiction to consider matters related to this Deed, its schedules and its appendices and the debenture appended hereto shall be the competent court in Tel Aviv-Jaffa. 90 1614780295.2 For details of the undertakings of the Company, Pacific Oak SOR Properties LLC, the REIT Fund, and officers of the Company, see Section 5.7 above. 35. General Without derogating from the other provisions of this Deed and the Debentures (Series D), any waiver, time extension, relaxation, silence or inaction ("waiver") on the part of the Trustee with respect to the non-fulfillment or partial or incorrect fulfillment of any of the undertakings towards the Trustee under this Deed and the Debentures (Series D), shall not be deemed as the Trustee's waiver of any right but only as consent limited to the particular occasion on which it was given. Without derogating from the other provisions of this Deed and the Debentures (Series D), any change in the undertakings towards the Trustee requires the Trustee's prior written consent. Any other consent, whether verbal or by way of waiver and inaction or other than in writing, shall not be deemed consent at all. The Trustee's rights under this agreement are autonomous and independent of each other and are in addition to any existing and/or future right of the Trustee by law and/or agreement (including this Deed and the Debenture (Series D)). 36. Trustee's Liability 36.1. Notwithstanding any statutory provision and any provision of the Deed of Trust, if the Trustee acted for the fulfillment of its duties in good faith and within a reasonable time and clarified the facts which a reasonable Trustee would have clarified in the circumstances of the case, then it shall not be responsible for the damage caused, unless a peremptory judgment has determined that the Trustee acted with gross negligence. It is clarified that if a contradiction arises between the provision of this section and any other provision of the Deed of Trust, the provision of this section shall prevail. 36.2. 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 the performance of such action. 37. Addresses The parties' addresses shall be as set out in the preamble to this Deed, or any other address regarding which a suitable written notice is given to the other party. 38. Magna Authorization 91 1614780295.2 In accordance with the provisions of the Securities Regulations (Electronic Signature and Reporting), 5763-2003, the Trustee hereby authorizes the person authorized for that purpose by the Company to report electronically to the Securities Authority regarding this Deed of Trust. 92 1614780295.2 In witness whereof the parties have hereunto set their hands: /s/ Michael A. Bender /s/ Michal Avtalion-Rishoni Pacific Oak SOR (BVI) Holdings Ltd. Reznik Paz Nevo Trusts Ltd. I, the undersigned, Laurie Selwitz, Notary, certify that this Deed of Trust has been duly signed by the authorized signatory of Pacific Oak SOR (BVI) Holdings Ltd., Mr. Michael Bender, and the signature thereof binds the said Company in connection with this Deed of Trust. /s/ Laurie Selwitz Laurie Selwitz, Notary

---

93 1614780295.2 Pacific Oak SOR (BVI) Holdings LLC First Schedule Certificate of Debenture (Series D) Registered Debentures (Series D), bearing fixed annual interest at a rate to be determined in a tender (hereinafter: "the Interest") are repayable in three (3) annual installments due on February 28, 2027, February 28, 2028, and February 28, 2029, such that each of the first two payments constitutes 33% of the total part value of Debentures (Series D) and the third and final payment constitutes 33% of the total part value of Debentures (Series D). The interest on the unpaid balance of the principal of the Debentures (Series D) shall be paid twice per year, on August 31 and February 28, starting August 31, 2024 and ending February 28, 2029 (inclusive). Except for the first interest period (as it is defined in the terms overleaf), any interest rate payment will be for the six-month period ended on the day prior to the date of payment. Registered Debenture (Series D) No. 1 Par value ILS __________ Fixed annual interest at a rate of __%. 1. This certificate attests that Pacific Oak SOR (BVI) Holdings LTD. ("the Company") shall remit principal and interest payments to the Mizrahi Tefahot Bank Nominee Company LTD or to whomever is the registered owner of this Debenture (Series D Debenture Holder), all pursuant to the remaining terms set forth in the Deed of Trust and terms overleaf. 2. The Debentures (Series D) are issued in accordance with a deed of trust ("Deed of Trust") dated April 21, 2024 signed between the Company and Reznik Paz Nevo Trusts Ltd. ("the Trustee"). 3. All the Debentures (Series D) will rank pari passu with one another with respect to the Company's obligations as per Debentures (Series D), without one having a preferred right or priority over another. 4. This Debenture (Series D) is issued subject to the terms set out overleaf, the terms set out in the Deed of Trust and the Shelf Offering Report. Signed under the Company's affixed seal on ___________ By: 94 1614780295.2 Authorized signatory ____________________ Authorized signatory ____________________ I, the undersigned, Adv. ____, certify that this debenture certificate has been duly signed by Pacific Oak SOR (BVI) Holdings Ltd., in accordance with its articles, through Mr. ___________ and its signature thereof binds on the Company for the purposes of this debenture. ____, Adv. 95 1614780295.2 Terms Overleaf 1. General In this Debenture (Series D), the terms below shall have the meaning set out next to them, and terms for which no meaning is provided below shall have the meaning given to them in the Deed of Trust, unless explicitly noted otherwise: "Business Day" or "Bank Business Day" Any day on which the TASE Clearing House and most banks in Israel are open for the execution of transactions. "Debenture Series" Registered Debentures of ILS 1 par value each, the terms of which shall be in accordance with the Deed of Trust, the Debenture (Series D) certificate and the Shelf Offering Report, as such are defined in the Deed of Trust, pursuant to which they shall be issued. "Principal" The par value of the outstanding Debentures (Series D). "Special Resolution" A resolution adopted in a general meeting of holders of Debentures (Series D) at which at least two debenture holders holding at least 50% of the par value of the outstanding Debentures (Series D) are present in person or by proxy, or in an adjourned meeting at which at least two debenture holders holding at least 20% of the balance of said par value are present in person or by proxy, by a majority (whether in the original meeting or in the adjourned meeting) of at least two thirds (2/3) of the par value of the outstanding Debentures (Series D) represented in the vote. "Nominee Company" The Mizrahi Tefahot Bank nominee Company Ltd, or a nominee company replacing it, provided that all the securities of the Company listed for trading will be registered under its name. "Trading Day" A day on which transactions are executed on the Tel Aviv Stock Exchange Ltd. "TASE Clearing House" The Tel Aviv Stock Exchange Clearing House Ltd. 2. The Debentures 96 1614780295.2 For details regarding the Debentures (Series D), see Section 2 of the Deed of Trust. 3. Terms of the Debentures (Series D) Offered under the Prospectus A. Registered Debentures (Series D) of ILS 1 par value each. The Debentures (Series D) shall be repayable in three (3) annual installments due on February 28, 2027, February 28, 2028, and February 28, 2029, such that each of the first two payments constitutes 33% of the total part value of Debentures (Series D) and the third and final payment constitutes 33% of the total part value of Debentures (Series D). B. The outstanding balance of the principal of the Debentures (Series D) shall bear fixed annual interest at a rate to be determined in a tender (subject to adjustments in the event of a change in the rating of the Debentures (Series D)9 and/or noncompliance with a financial covenant as set forth in Sections 5.2 and 5.3 of the Deed of Trust and/or arrears interest, if any). C. The Debentures (Series D) shall not be linked to any linkage basis. D. The interest on the Debentures (Series D) shall be paid twice per year, on August 31 and February 28, in each of the years from 2024 to 2029, starting August 31, 2024 and ending February 28, 2029 (inclusive). Except for the first interest period (as it is defined below), any interest rate payment will be for the six-month period ended on the day prior to the date of payment (hereinafter: "the Interest Period"). E. The first payment of interest on the Debentures (Series D) shall be made on August 31, 2024, for the period commencing on the first trading day after the tender date of the Debentures (Series D), and ending on the last day before the first interest payment date (namely, August 30, 2024) (hereinafter: "the First Interest Period"), calculated according to the actual days in that period based on 365 days in a year. The interest rate payable for a particular interest period (excluding the first interest period) (i.e. the period commencing on the payment day of the previous interest period and ending on the last day before the next payment date after the commencement thereof) shall be calculated at the annual interest rate divided by two (hereinafter: "the Semiannual Interest Rate"). The Company shall publish in an immediate report regarding the results of the issuance, the first interest rate, the annual interest rate, and the semiannual interest rate. 9 It is clarified that as long as the Debentures (Series D) are rated by more than one rating agency, the examination of the rating for the purpose of adjusting the interest rate to a change in the rating (should there be any such change) shall be done, at all times, whichever rating is lower.

---

97 1614780295.2 F. Payments on account of principal and/or interest in respect of the Debentures (Series D) shall be paid to holders of the Debentures (Series D) on August 19 (for payments due August 31) and February 16 (for payments due February 28), except for the final payment of principal and interest payable on February 28, 2029, which shall be paid to those individuals whose names are recorded in the registrar upon the payment date and shall be remitted against the delivery of Debentures (Series D) to the Company upon the final payment date (February 28, 2029), in Company's registered office or any other location announced by the Company. Company's aforementioned announcement shall be published no later than five (5) working days prior to the final payment date. G. It is hereby clarified that anyone who is not counted among the debenture holders on any of the payment dates specified in Subsection (f) above shall not be entitled to payment for the period commencing before that date. 4. Principal and Interest Payments on the Debentures (Series D) A. Any payment on account of principal and/or interest delayed more than seven (7) days after the date set for payment thereof under the terms of the debenture, for a reason within the Company's control, shall bear arrears interest, as hereinafter defined, from the date set for payment to the date of actual payment thereof. In this regard, the rate of arrears interest shall be the debentures interest rate as set forth in the above Section 3(B), with the addition of 3.5%, all on an annual basis (hereinafter: "Arrears Interest"). The Company shall give notice of the aforesaid Arrears Interest rate and the semiannual interest rate (subject to adjustments due to changes in the rating of the Debentures (Series D) and/or failure to comply with a Financial Covenant as set forth in Sections 5.2 and 5.3 to the Deed of Trust) as well as the payment date in an immediate report, two (2) trading days before the date of actual payment. In this regard, payment on account of principal and/or interest that was not deposited with the Trustee in accordance with Section 14.2 of the Deed Trust, will be deemed as an unmade payment for a reason dependent on the Company. B. The payment to the entitled persons shall be made by check or by a bank transfer and/or through the TASE Clearing House to the credit of the bank account of the holders of Debentures (Series D). If the Company is unable, for any reason beyond its control, to pay any amount to the persons entitled thereto, the provisions of Section 7 below shall apply. C. Any holder of a Debenture (Series D) who so wishes, may notify the Company of the details of the bank account for crediting the payments to that holder under the Debentures (Series D) as stated, or of a change in the 98 1614780295.2 details of said account or in his address, as the case may be, in a notice sent by registered mail to the Company. The Company shall be required to act in accordance with the holder's notice of change after the expiration of 15 business days from the day on which the Company received such notice. D. If a debenture holder who is registered in the register of holders failed to give the Company timely notice of the details of the bank account to which payments under the debenture should be transferred to him, any such payment shall be made in a check sent by registered mail to his last address recorded in the register of holders. The sending of a check to an entitled person by registered mail as stated shall be deemed in all respects as payment of the amount specified thereon on the date of mailing thereof, subject to the check being deposited in the bank and actually cashed. 5. Deferral of Dates If the date specified for making any payment of principal and/or interest falls on a day that is not a business day, the payment date shall be deferred to the business day immediately following that day, with no additional payment, and the "effective date" for determining entitlement to redemption and interest shall not be changed by reason thereof. 6. Securing of Debentures See Section 6 of the Deed of Trust. 7. Nonpayment for a Reason out of the Company's Control As to nonpayment for a reason out of the Company's control, see the provisions of Section 14 of the Deed of Trust. 8. Register of Debenture Holders As to the register of holders of Debentures (Series D), see Section 29 of the Deed of Trust. 9. Splitting of Debenture Certificates A. In respect of Debentures (Series D) registered in the name of one holder, one certificate shall be issued to the holder or, at his request several certificates shall be issued to him in a reasonable quantity (the certificates discussed in this section are hereinafter referred to as "the certificates"). 99 1614780295.2 B. Any debenture certificate may be split into several debenture certificates with a total par value equal to the nominal amount of the certificate it is proposed to split, provided such certificates are only issued in a reasonable quantity and in full New Shekels. The split shall be made against delivery of the relevant debenture certificate to the Company at its registered office for the performance of the split, together with a written request to make the split, signed by the registered holder. All the costs entailed in the split, including taxes and levies, if any, shall be borne by the party requesting the split. 10. Transfer of Debentures The Debentures are transferrable with respect to the full amount of the nominal principal, and also a part thereof, provided it is in whole shekels. Any transfer of the Debentures shall be made by a deed of transfer drawn up in the accepted form, duly signed by the registered holder or his legal representatives and by the transferee or his legal representatives, which shall be delivered to the Company at its registered office together with the certificates of the Debentures which are being transferred on the basis thereof as well as any other reasonable proof as requested by the Company in evidence of the transferor's right to transfer them. If any tax or other mandatory payment applies to the deed of transfer of the Debentures, the Company shall be given reasonable proof of the payment thereof. The Company's articles as relating to the transfer and endorsement of fully paid- up shares shall apply, mutatis mutandis, as the case may be, to the transfer and endorsement of the Debentures. If only a part of the amount of the nominal principal in a debenture certificate is transferred, the debenture certificate shall first be split, as provided in Section 9 below, into the number of debenture certificates necessitated thereby, such that the total of the amounts of the nominal principal in those debenture certificates is equal to the amount of the nominal principal of such debenture certificate. Following the fulfillment of all the above stated conditions, the transfer shall be recorded in the Register, and the Company may demand that a caveat regarding such transfer be recorded on the transferred debenture certificate that is to be transferred to the transferee, or that a new debenture certificate be issued to him in its stead, and the transferee shall be subject to all the conditions set forth in the transferred debenture certificate, such that the term "holder" where it appears shall be deemed to refer to the "transferee," and the transferee shall be regarded as the "holder" for purposes of the Deed of Trust. 11. Early Redemption As to early redemption of the Debentures at the initiative of the TASE and as to early redemption at the Company's initiative, see Section 7 of the Deed of Trust. 100 1614780295.2 12. Purchase of Debentures by the Company and/or a Related Person As to the purchase of the Debentures, see Section 3 of the Deed of Trust. 13. Waiver, Settlement, and Changes to Deed of Trust As to waiver, settlement, and changes to the Deed of Trust see Section 28 of the Deed of Trust. 14. Meetings of Debenture Holders General meetings of the holders of Debentures (Series D) shall convene and be conducted in the manner provided in the Second Schedule to the Deed of Trust. 15. Receipt from Debenture Holders As to receipts from the debenture holders, see Section 15 of the Deed of Trust. 16. Immediate Repayment As to immediate repayment of the Debentures, see Section 8 of the Deed of Trust. 17. Notices As to notices, see Section 27 of the Deed of Trust. 18. Governing Law and Jurisdiction As to the governing law and jurisdiction, see Sections 33 and 34 of the Deed of Trust. 19. Priority In case of a contradiction between this schedule and the Deed of Trust, the provisions of the Deed of Trust shall prevail. It is hereby clarified that as of the date of signing the Deed, there is no contradiction between the provisions described in this Schedule and the provisions described in the Deed of Trust ***

---

pacificoaksorq32024-seri

Exhibit 10.8 1614780418.2 Amendment #1 to the Deed of Trust Prepared and executed on September 2, 2024 Between: SOR (BVI) Holdings Ltd. PACIFIC OAK (Previously: KBS SOR (BVI) Holdings LTD.) A foreign company of the British Virgin Islands for which the registered offices in the Virgin Islands are C/O: Trident Trust Company (B.V.I.) Limited of Trident Chambers, P.O. Box 146, Road Town, Tortola, British Virgin Islands1 And for which the address in Israel for legal documents is: C/O US Real Estate Representation LTD., 4 Ariel Sharon, Givatayim Tel: 03-6123939 Fax: 03-6125030 (hereinafter: The Company) 1. The First Party; And between: Reznik Paz Nevo Trusts LTD. Of 14 Yad Harutzim, Tel Aviv Telephone: 03-6389200 Fax: 03-6289222 (hereinafter: The Trustee) 2. The Second Party; Whereas: The parties have signed a Deed of Trust for Company’s Series B Debentures (Debentures) bearing the date of February 12, 2020 (hereinafter: The Deed of Trust); And whereas: According to the immediate report published by the Company on August 14, 2024 Company wishes to utilize the net proceeds from the issuance of Series D Debentures issued subject to the Shelf Offering Report of August 18, 2024, as well as additional funds, for the purpose of preponing the principal and   1 Previously Hauteville Trust (BVI) Limited. ‐2‐    1614780418.2 interest payment on Series B Debentures scheduled for January 31, 2025, as set forth in this Amendment herein: And whereas: On the day of September 1, 2024, an assembly of Series B Debentures Holders approved the aforementioned amendment to the Deed of Trust; And whereas: On the day of August 15, 2024, the Board of Directors approved the aforementioned amendment to the Deed of Trust; The parties have therefore affirmed, declared and conditioned the following: 1. Preamble, Interpretation and Terminology 1.1. The above preamble constitutes an integral part of this amendment. 1.2. Sections and section headers have been provided solely for the purpose of convenience and to serve as placeholders, and should not be used for interpretation. 1.3. In any case of a contradiction between the provisions of the Deed of Trust and the provisions of the Amendment, the provisions of the Amendment shall supersede. 1.4. Upon its execution this amendment shall constitute an integral part of the Deed of Trust, and any terms used in this amendment shall be interpreted in accordance with the meaning afforded to them in the Deed of Trust, as applies, unless noted otherwise in this amendment. 1.5. Excluding explicit statements included in this amendment, no changes have been made to the remaining provisions of the Deed of Trust, and any provisions of the Deed of Trust shall remain in effect unless explicitly noted otherwise in this amendment. 2. Revision to the amortization schedule by way of an additional principal and interest payment on a date prior to January 31, 2025 2.1. Section 2.2 of the Deed of Trust, Section 1 of the Debenture Certificate appended to the Deed of Trust, and Section 3 of the Terms Overleaf appended to the Deed of Trust shall continue as follows – a. “Furthermore, notwithstanding the aforementioned, of the principal and interest payment scheduled for January 31, 2025, an amount of NIS 318,900,000 shall be preponed and remitted on September 19 , 2024 (hereinafter: Preponed Payment Date and Preponed Payment Amount, as applies) to holders of Company’s Series B Debentures on the day of September 7, 2024 ‐3‐    1614780418.2 The Preponed Payment Amount constitutes a principal payment of NIS 312,754,377 (40.28478% of the outstanding principal balance of the Debentures as of the date of this amendment to the Deed of Trust and %26.85786 of the original principal of the Debentures) (hereinafter: Preponed Principal Amount), as well as an amount of NIS 6,145,623, constituting the entirety of cumulative interest due on the Preponed Principal Amount as if it were paid on January 31, 2025 (hereinafter: Preponed Interest Amount). Accordingly, the Preponed Interest Amount to be remitted on September 19 , 2024 reflects the semiannual interest rate (i.e., a rate of 1.965%) originally due on January 31, 2025, derived from the Preponed Principal Amount. The Preponed Interest Amount shall constitute an interest rate of %0.79160 of the outstanding principal balance of the Debentures as of the date of this amendment to the Deed of Trust and effective annual interest rate of
 (a rate to be adjusted in the Exchange’s systems). b. “Further to the aforementioned, the payment scheduled for January 31, 2025 shall include the principal and interest amounts originally due on that date, and which did not constitute a part of the repaid Preponed Payment Amount. Accordingly, the principal payment to be remitted on January 31, 2025 shall total NIS 75,366,762 (16.2567% of the remaining principal balance of the Debentures as it will be after the payment described in subsection A above and %6.47214 of the original principal of the Debentures) (hereinafter: January 2025 Principal Payment Amount), as well as interest totaling NIS 9,109,825due on the January 2025 Principal Payment Amount, accumulated beginning August 31, 2024 and through January 30, 2025 and constitutes the semiannual interest rate (i.e. a rate of 1.965%) and an annual effective interest at a rate of 
(a rate to be adjusted in the Exchange’s systems).” ‐4‐    1614780418.2 And to wit, the Parties have affixed their signatures /s/ Michael A. Bender /s/ Michal Avtalion-Rishoni PACIFIC OAK SOR (BVI) Holdings Ltd. Reznik Paz Nevo Trusts LTD. I, the undersigned, Laurie Selwitz, Notary Public, affirm that this Deed of Trust was signed by an authorized signatory of PACIFIC OAK SOR (BVI) Holdings LTD., Mr. Michael Bender, and his signature binds the aforementioned company in connection with this Deed of Trust. /s/ Laurie Selwitz Laurie Selwitz, Notary Public

---

Document

Exhibit 31.1

Certification of Chief Executive Officer pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, Keith D. Hall, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Pacific Oak Strategic Opportunity REIT, 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:

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;

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;

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

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):

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

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:	November 14, 2024	By:	/s/ Keith D. Hall
			Keith D. Hall
			Chief Executive Officer and Director
			(principal executive officer)

Document

Exhibit 31.2

Certification of Chief Financial Officer pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, Michael A. Bender, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Pacific Oak Strategic Opportunity REIT, 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:

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;

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;

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

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):

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

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:	November 14, 2024	By:	/s/ Michael A. Bender
			Michael A. Bender
			Chief Financial Officer
			(principal financial officer)

Document

Exhibit 32.1

Certification 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 Pacific Oak Strategic Opportunity REIT, Inc. (the “Registrant”) for the quarter ended September 30, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, Keith D. Hall, Chief Executive Officer and Director of the Registrant, hereby certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge and belief:

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 Registrant.

Date:	November 14, 2024	By:	/s/ Keith D. Hall
			Keith D. Hall
			Chief Executive Officer and Director
			(principal executive officer)

Document

Exhibit 32.2

Certification 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 Pacific Oak Strategic Opportunity REIT, Inc. (the “Registrant”) for the quarter ended September 30, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, Michael A. Bender, the Chief Financial Officer of the Registrant, hereby certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge and belief:

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 Registrant.

Date:	November 14, 2024	By:	/s/ Michael A. Bender
			Michael A. Bender
			Chief Financial Officer
			(principal financial officer)