Company: INTG
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001641172-25-010724
Chunk: 96

Company: INTERGROUP CORP
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 8
Chunk 96
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 Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, the Company’s internal
control over financial reporting.

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PART
II

OTHER
INFORMATION

Item
1. LEGAL PROCEEDINGS

Portsmouth
Square, Inc., through its operating company Justice Investors Operating Company, LLC, a Delaware limited liability company (the “Company”),
is the owner of the real property located at 750 Kearny Street in San Francisco, currently improved with a 27 – story building
which houses a Hilton Hotel (the “Property”). The Property was purchased and improved pursuant to the terms of a series of
agreements with the City and County of San Francisco (the “City”) in the early 1970’s. The terms of the agreements
and subsequent approvals and permits included a condition by which the Company was required to construct an ornamental overhead pedestrian
bridge across Kearny Street, connecting the Property to a nearby City-owned park and underground parking garage known as Portsmouth Square
(the “Bridge”). Included in the approval process was the City’s issuance of a Major Encroachment Permit (“Permit”)
allowing the Bridge to span over Kearney Street. As of May 24, 2022, the City has purported to revoke the Permit and on June 13, 2022,
directed the Company to submit a general bridge removal and restoration plan (the “Plan”) at the Company’s expense.
The Company disputes the legality of the purported revocation of the Permit. The Company further disputes the existence of any legal
or contractual obligation to remove the Bridge at its expense. In particular, representatives of the Company participated in meetings
with the City on and at various times after August 1, 2019, to discuss a collaborative process for the possible removal of the Bridge.
Until the purported revocation of the Permit in 2022, the City representatives repeatedly and consistently promised and agreed that the
City will pay for the associated costs of any Bridge removal. Nevertheless, without waiving any rights, in an effort to understand all
of the available options, and to provide a response to the City’s directives, the Company has engaged a Project Manager, a structural
engineering firm and an architect to participate in the development of a Plan for the Bridge removal, as well as the reconstruction of
the front of the Hilton Hotel. The Company has been working cooperatively with the City on the process for removal of the Bridge and
its related physical encroachments, including