Company: INTG
Filing Date: 2025-02-14
Form Type: 10-Q
Source: 0001493152-25-006758
Chunk: 88

Company: INTERGROUP CORP
Filing Date: 2025-02-14
Form: 10-Q
Item: Part I, Item 8
Chunk 88
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 primarily consist of funds necessary to pay for operating and other expenditures, including management
and franchise fees, corporate expenses, payroll and related costs, taxes, interest and principal payments on our outstanding indebtedness,
and repairs and maintenance of the Hotel.

-26-

Our
long-term liquidity requirements primarily consist of funds necessary to pay for scheduled debt maturities and capital improvements of
the Hotel and our real estate properties. We will continue to finance our business activities primarily with existing cash, including
from the activities described above, and cash generated from our operations. The objectives of our cash management policy are to increase
existing leverage levels and the availability of liquidity, while minimizing operational costs. However, there can be no guarantee that
management will be successful with its plan.

Going
Concern

The
condensed consolidated financial statements of Portsmouth have been prepared on a going concern basis, which assumes the realization
of assets and the satisfaction of liabilities in the normal course of business. However, as of December 31, 2024, certain factors raise
substantial doubt about Portsmouth’s ability to continue as a going concern within one year after the issuance of these financial
statements.

As
disclosed in Note 9 – Related Party and Other Financing Transactions, Portsmouth has a senior mortgage loan and a mezzanine loan
totaling $100,289,000, which matured on January 1, 2024. On January 3, 2024, Portsmouth received a Notice of Default from the senior
loan special servicer, LNR Partners, LLC, and on January 14, 2024, a Notice of Default from the mezzanine lender, CRED Reit Holdco LLC,
regarding the matured loans. These notices grant the lenders various rights and remedies, including but not limited to acceleration of
the debt and foreclosure on collateral.

To
address the maturity issue, on April 29, 2024, Portsmouth entered into forbearance agreements with both its senior and mezzanine lenders,
extending the maturity date to January 1, 2025, while actively pursuing long-term refinancing solutions. However, on January 3, 2025,
Portsmouth received a Notice of Termination from the senior loan special servicer, citing a termination event due to Portsmouth’s
failure to fully repay the debt by the forbearance expiration date. As a result, the forbearance agreement was terminated, allowing the
lender to immediately exercise all rights and remedies, including acceleration of the loan