Elme Communities (ELMES): Other Paul McDermott mutual agreement

Events in this filing

Item 5.02 as filed

Item 5.02 Departure of Directors or Certain
Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
As previously disclosed, on January 22, 2026, Elme Communities
(the “Company” or “Elme”) entered into retention agreements (the “Retention Agreements”) with each
of Paul McDermott, Tiffany Butcher and W. Drew Hammond (the “Officers”), which agreements were intended to support the operations
of the Company during the implementation of the Plan of Sale and Liquidation approved by the Board of Trustees of the Company (the “Board”)
on July 30, 2025 and by the shareholders of the Company on October 30, 2025 (the “Plan of Sale and Liquidation”),
and to provide the Company with additional flexibility in retaining the services of the Officers as needed throughout the process. On
October 28, 2026, in connection with the winding-up of the affairs of the Company and its expected dissolution on November 6,
2026, the Board approved the termination of the Retention Agreements for each of Paul McDermott, Tiffany Butcher and W. Drew Hammond,
effective as of November 6, 2026. Messrs. McDermott and Hammond and Ms. Butcher will receive $5,062,631, $1,029,484 and
$1,661,939, respectively, as set forth in their respective Retention Agreements, as a cash lump sum. The Company also expects that, following
the transfer of all of the Company’s remaining assets and liabilities to a Maryland common law trust (the “Liquidating Trust”)
and dissolution of the Company, the Liquidating Trust will enter into individual consulting agreements with each of Mr. Hammond and
Ms. Butcher to assist the trustee of the Liquidating Trust with the discharge of the Company’s remaining liabilities on a part-time,
as-needed basis.