Company: INTG
Filing Date: 2025-09-30
Form Type: 10-K
Source: 0001493152-25-016154
Chunk: 479

Company: INTERGROUP CORP
Filing Date: 2025-09-30
Form: 10-K
Item: Item 8
Chunk 479
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 credit facility with InterGroup was amended to increase capacity to $40,000,000, extend maturity to July 31, 2027, and reduce
the interest rate to 9%, providing contingency liquidity. (See the notes on mortgage notes payable and related-party financing for terms.)

Management
evaluated Portsmouth’s ability to continue as a going concern for the twelve months following issuance and concluded that the conditions
and events that initially raised substantial doubt have been alleviated and that substantial doubt does not exist for Portsmouth as of
issuance under ASC 205-40.

While
management believes available liquidity and cash generation are sufficient for near-term needs, uncertainties related to the San Francisco
hospitality market and broader macroeconomic factors—including potential pressure on occupancy and RevPAR—could adversely
affect Portsmouth’s results and, indirectly, consolidated liquidity (e.g., through covenant or cash-management constraints on distributions).
Management will continue to monitor conditions and adjust operations and capital allocation as necessary. (See Item 7 MD&A and the
notes on mortgage notes payable.)

This
disclosure relates to Portsmouth and reflects management’s fiscal year 2025 evaluation of that subsidiary; it does not modify or
supersede going-concern disclosures in previously issued fiscal year 2024 financial statements and interim filings, and it does not indicate
a going-concern uncertainty for InterGroup.

    44

NOTE
2 – LIQUIDITY

Historically,
the Company has relied primarily on cash flows generated by its multi-family and commercial real estate portfolio and, to a lesser extent,
returns from its investment portfolio. Cash generated by the Hilton San Francisco Financial District (the “Hotel”) is owned
by our consolidated subsidiary, Portsmouth Square, Inc. (“Portsmouth”), is subject to lender-controlled cash-management arrangements,
and is not available for InterGroup’s general corporate purposes. Portsmouth has not paid dividends to its shareholders in over
a decade. Although conditions in the San Francisco hospitality market remain a headwind for Portsmouth—reflecting the pace of business-travel
recovery and certain municipal factors—those trends affect consolidated results but do not represent InterGroup’s source
of liquidity.

For
the year ended June 30, 2025, consolidated net cash provided by operating activities was $5,893,000. In response to ongoing market pressures
at the Hotel, Portsmouth continued capital-preservation initiatives (including deferral of non-essential projects, selective service
reductions, vendor negotiations and other controllable cost actions) while investing in