Countryside Closing

As previously disclosed on January 13, 2020, MHP Pursuits LLC, a wholly-owned subsidiary of Manufactured Housing Properties Inc., a Nevada corporation (the “Company”), entered into a purchase and sale agreement (the “Countryside Purchase Agreement”) with J & A Real Estate LLC (“J&A”) on January 7, 2020 for the purchase of a manufactured housing community known as Countryside Estates Mobile Home Park (the “Countryside Property”), which is located in Lancaster, North Carolina and totals 110 sites, for a total purchase price of $3.7 million. On March 12, 2020, closing of the Countryside Purchase Agreement was completed and the Company’s newly formed wholly owned subsidiary Countryside MHP LLC (“Countryside”) purchased the Countryside Property.

In connection with the closing, on March 12, 2020, Countryside issued a promissory note to J&A in the principal amount of $3,000,000 (the “Countryside Note”). The remainder of the purchase price for the Countryside Property, or $700,000, was paid in cash. The Countryside Note bears interest at the rate of 5.5% per annum, or the maximum rate allowed by applicable law, and is due and payable in full on March 20, 2050. Payments for the first twelve (12) months of the term of the Countryside Note shall be interest-only in the amount of $13,750 per month. Thereafter, principal and interest, in the amount of $17,201 per month, shall be due and payable based upon a thirty (30) year amortization. If any monthly payment is not received by J&A within fifteen (15) days after the applicable due date, Countryside must pay a late charge in an amount equal to the delinquent amount then due multiplied by 4%. Countryside may prepay the Countryside Note, in whole or in party, at any time without penalty.

The Countryside Note also contains customary events of default, including: (i) if Countryside shall be in default in the payment of any principal, interest or other amount due under the Countryside Note and such default shall not be cured within five (5) days after written notice from J&A; (ii) if Countryside shall be in default in the performance of any non-monetary obligation in the Countryside Note and such default shall not be cured within thirty (30) days after written notice from J&A; or (iii) if Countryside shall default in the due observation or performance of any covenant, condition or agreement contained in the Mortgage (as defined below) and such default shall not be cured within thirty (30) days after written notice from J&A. Upon the occurrence of an event of default, interest on the aggregate outstanding indebtedness (including accrued interest) of the Countryside Note shall increase to 5.5% per annum plus the U.S. Prime Rate as measured and reported by the Wall Street Journal and in effect on the date of default, until such aggregate indebtedness is paid in full.

The Countryside Note is secured by a mortgage, assignment of rents and leases, security agreement and fixture filing with respect to the Countryside Property (the “Mortgage”). The Mortgage contains customary representations, warranties and covenants by Countryside and remedies upon an event of default under the Countryside Note.

The foregoing summary of the terms and conditions of the Countryside Note and the Mortgage does not purport to be complete and is qualified in its entirety by reference to the full text of the agreements attached hereto as Exhibits 10.2 and 10.3, respectively, which are incorporated herein by reference.

Evergreen Signing and Closing

On January 1, 2020, MHP Pursuits LLC, a wholly-owned subsidiary of the Company, entered into a purchase and sale agreement (the “Evergreen Purchase Agreement”) with Evergreen Marketing LLC for the purchase of a manufactured housing community known as Evergreen Pointe Mobile Home Park (the “Evergreen Property”), which is located in Dandridge, Tennessee and totals 65 sites, for a total purchase price of $1,438,000. On March 17, 2020, closing of the Evergreen Purchase Agreement was completed and the Company’s newly formed wholly owned subsidiary Evergreen MHP LLC (“Evergreen”) purchased the Evergreen Property.

In connection with the closing, on March 17, 2020, Evergreen entered into a loan agreement (the “Loan Agreement”) with Hunt Mortgage Capital, LLC (the “Lender”) for a loan in the principal amount of $1,150,000 and Evergreen issued a promissory note to the Lender in the principal amount of $1,150,000 (the “Evergreen Note”). The remainder of the purchase price for the Evergreen Property, or $288,000, was paid in cash.

The Evergreen Note bears interest at a rate of 3.99% per annum and is due and payable on April 1, 2032. The monthly payments under the Evergreen Note are equal to $5,483.65. If any monthly payment is not received by the Lender within ten (10) days after the applicable due date, Evergreen must pay a late charge in an amount equal to the delinquent amount then due multiplied by 5%. Furthermore, if any payment remains past due for thirty (30) days or more, interest on such unpaid amounts shall accrue at the lesser of 7.99% or the maximum rate allowed by applicable law. Evergreen may prepay the Evergreen Note in full, but not in part, at any time if it pays a prepayment premium calculated in accordance with the Loan Agreement.

The Evergreen Note is secured by the Evergreen Property and guaranteed by Mr. Raymond M. Gee, the Company’s Chief Executive Officer, Gvest Capital Real Estate LLC, an entity controlled by Mr. Gee, and the Company (the “Guarantors”).

The Loan Agreement was subject to customary closing conditions and contains customary representations and warranties. The Loan Agreement also contains customary financial and other covenants for a loan of this type. The Loan Agreement also contains customary events of default, some of which are subject to cure periods as set forth in the Loan Agreement, including, but not limited to: (i) any failure by Evergreen to pay or deposit when due any amount required by the Note, the Loan Agreement or any other loan document (as defined in the Loan Agreement); (ii) any failure by Evergreen to maintain the insurance coverage required by any loan document; (iii) if any warranty, representation, certification, or statement of Evergreen or any Guarantor in the Loan Agreement or any of the other loan documents is false inaccurate, or misleading in any material respect when made; (iv) the fraud, gross negligence, willful misconduct, or material misrepresentation or material omission by or on behalf of Borrower or any Guarantor or any of their officers, directors, trustees, partners, members, or managers in connection with the application for, or creation of, the loan or any financial statement, rent roll, or other report or information provided to Lender during the term of the loan; (v) the occurrence of any transfer (as defined in the Loan Agreement) not permitted by the loan documents; (vi) the occurrence of a bankruptcy event (as defined in the Loan Agreement); (vii) if a Guarantor is a natural person, the death of such individual, unless certain requirements set forth in the Loan Agreement are met; (viii) the occurrence of a guarantor bankruptcy event (as defined in the Loan Agreement), unless certain requirements of the Loan Agreement are met; (ix) any failure by Evergreen or a Guarantor to comply with certain covenants in the Loan Agreement; or (x) any failure by Evergreen to perform any of its obligations under the Loan Agreement or any loan document as and when required.

The foregoing summary of the terms and conditions of the Evergreen Purchase Agreement, the Loan Agreement and Evergreen Note does not purport to be complete and is qualified in its entirety by reference to the full text of the agreements attached hereto as Exhibits 10.4, 10.5 and 10.6, respectively, which are incorporated herein by reference.