Financial Analysis

NOTE 17 COMMITMENTS AND CONTINGENCIES Cash Management Agreement In connection with the March 28, 2025 refinancing of the Hotels senior mortgage, Justice Operating Company, LLC (Operating) entered into a Cash Management Agreement with Prime Finance (lender) and Wells Fargo Bank, N.A. (cash management bank). Under this agreement, all Hotel receipts are deposited into a lender-controlled lockbox pursuant to a deposit account control agreement and swept to a cash management account maintained for the benefit of the lender. The cash management bank maintains subaccounts (including debt service, property tax, insurance, capital expenditure/FF&E, PIP, carry reserve, cash collateral, casualty/condemnation and security deposit subaccounts). On each monthly payment date, funds are applied in a set priority: (i) tax reserve, (ii) insurance reserve, (iii) bank fees, (iv) amounts due under the senior loan (interest and any other amounts due thereunder), (v) capital expenditure/FF&E reserve, (vi) approved operating expenses and custodial funds, and (vii) all remaining available cash to the carry reserve during the initial cash-management period or, thereafter, to the cash collateral subaccount, all in accordance with the loan documents. The account must maintain a minimum balance of $ 5,000 . While no event of default exists, interest on balances (other than tax and insurance subaccounts) accrues to Operating; upon an event of default, the lender may direct application of all funds …

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Disaggregation by major revenue source: SCHEDULE OF DISAGGREGATION OF MAJOR REVENUE For the year ended June 30, 2025 2024 Hotel revenues $ 46,363,000 $ 41,886,000 Real estate revenues 18,015,000 16,254,000 Total revenues $ 64,378,000 $ 58,140,000

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NOTE 15 STOCK-BASED COMPENSATION PLANS The Company currently has one equity compensation plan, which is the Intergroup 2010 Omnibus Employee Incentive Plan. The plan has been approved by the Companys stockholders and is described below. Any outstanding options issued under the Key Employee Plan or the Non-Employee Director Plan remain effective in accordance with their terms. As of June 30, 2025 and 2024, there were no RSUs outstanding. The InterGroup Corporation 2010 Omnibus Employee Incentive Plan On February 24, 2010, the shareholders of the Company approved The Intergroup Corporation 2010 Omnibus Employee Incentive Plan (the 2010 Incentive Plan), which was formally adopted by the Board of Directors following the annual meeting of shareholders. The Company believes that such awards help align the interests of its employees with those of its shareholders. Option awards are generally granted with an exercise price equal to the market price of the Companys stock at the date of grant; those option awards generally vest based on five ( 5 ) years of continuous service. Certain option and share awards provide for accelerated vesting if there is a change in control, as defined in the 2010 Incentive Plan. The 2010 Incentive Plan, as modified in December 2013, authorizes a total of up to 400,000 shares of common stock to be issued as equity compensation to officers and employees of the Company in an amount and in a manner to be determined by the Compensation Committee in accordance …

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NOTE 7 - FAIR VALUE MEASUREMENTS The carrying values of the Companys financial instruments that are not measured at fair value on a recurring basis approximate fair value due to their short maturities (including accounts receivable, other assets, accounts payable and other liabilities, due to securities broker and obligations for securities sold) or the nature and terms of the obligation (such as other notes payable and mortgage notes payable). Management evaluates their instruments in accordance with ASC 820 and has determined that there are no material differences between the carrying amounts and estimated fair values of these financial instruments as of June 30, 2025 and 2024. There were no transfers between Levels 1, 2, and 3 during years ended June 30, 2025 and 2024. The assets measured at fair value on a recurring basis are as follows: SCHEDULE OF FAIR VALUE MEASUREMENT ON RECURRING BASIS As of June 30, 2025 Level 1 Assets: Investment in marketable securities: REITs and real estate companies $ 966,000 Technology 3,000 Total $ 969,000 As of June 30, 2024 Level 1 Assets: Investment in marketable securities: REITs and real estate companies $ 3,358,000 Communication services 1,994,000 T-Notes 933,000 Energy 303,000 Financial services 269,000 Healthcare 179,000 Utilities 163,000 Industrial 159,000 Basic materials 75,000 Technology 21,000 Total $ 7,454,000 The fair values of investments in marketable securities are determined by the most recently traded price of each security …

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NOTE 13 INCOME TAXES The provision for the Companys income tax (expense) benefit is comprised of the following: SCHEDULE OF INCOME TAX (EXPENSE) BENEFIT For the years ended June 30, 2025 2024 Federal Current tax benefit (expense) $ 62,000 $ (20,000 ) Deferred tax (expense) benefit (523,000 ) 206,000 Federal income tax (expense) benefit, total (461,000 ) 186,000 State Current tax benefit (expense) 14,000 (100,000 ) Deferred tax expense (101,000 ) (3,000 ) State income tax (expense) benefit, total (87,000 ) (103,000 ) Income tax (expense) benefit $ (548,000 ) $ 83,000 The provision for income taxes differs from the amount of income tax computed by applying the federal statutory income tax rate to income before taxes as a result of the following differences: SCHEDULE OF EFFECTIVE INCOME TAX RATE RECONCILIATION For the years ended June 30, 2025 2024 Statutory federal tax rate $ 1,469,000 $ 2,644,000 State income taxes, net of federal tax benefit 737,000 1,051,000 Dividend received deduction 12,000 24,000 Perm differences (336,000 ) (542,000 ) Provision to return adjustment 105,000 (712,000 ) Valuation allowance (2,831,000 ) (2,700,000 ) Payable true up 182,000 320,000 State rate change impact 95,000 33,000 Other 19,000 (35,000 ) Income tax expense (benefit) $ (548,000 ) $ 83,000 The components of the deferred tax asset and liabilities are as follows: SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES June 30, 2025 June 30, 2024 Deferred tax assets: Net operating loss carryforwards $ …

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Recently Issued and Adopted Accounting Pronouncements In November 2023, the FASB issued ASU No 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (ASU 2023-07). We adopted ASU 2023-07 effective July 1, 2024 (fiscal 2025). The amendments expanded annual segment disclosure (including significant segment expenses and CODM measures) and will expand interim segment disclosures beginning in fiscal 2026. Adoption did not have a material impact on our consolidated financial statements, but resulted in enhanced segment disclosures. In December 2023, the FASB issued ASU No 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09). ASU 2023-09 is effective for fiscal years beginning after December 15, 2024 (our fiscal 2026). We expect the standard to expand our income tax rate reconciliation and cash taxes paid disclosures; we do not expect a material impact on our consolidated financial position or results of operations. …

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NOTE 16 RELATED PARTY TRANSACTIONS As discussed in Note 9 Other Financing Transactions, on July 2, 2014, InterGroup, as lender, established an unsecured revolving loan facility to its then-consolidated subsidiary, Justice Investors L.P. (the Partnership), with an initial principal capacity of $ 4,250,000 , bearing a fixed annual interest rate of 12 %, with no monthly principal or interest payments required prior to maturity. InterGroup also earned a loan fee equal to 3 % of the original commitment. The facility was prepayable at any time without penalty and was subsequently extended through July 31, 2023. On December 16, 2020, InterGroup and the Partnership executed a loan modification increasing the maximum borrowing capacity, as needed, to $ 10,000,000 . Subsequently, on December 31, 2021, following the dissolution of the Partnership, Portsmouth Square, Inc. (Portsmouth), InterGroups majority-owned subsidiary and successor obligor, entered into a modification that (i) transferred the outstanding obligation to Portsmouth following the Partnerships dissolution on December 23, 2021 (then $ 11,350,000 ) and (ii) increased Portsmouths borrowing limit to $ 16,000,000 . In July 2023, the loans maturity date was extended to July 31, 2025 , and the available borrowing capacity was increased to $ 20,000,000 . In connection with this increase, Portsmouth agreed to pay InterGroup 0.5 % loan modification fee applicable to the additional $ 10,000,000 . In March 2024, InterGroup and Ports …

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NOTE 3 REVENUE Our revenue from real estate is primarily rental income from residential and commercial property leases that is accounted for under ASC 842 (Leases). Lease income is recognized on a straight-line basis over the lease term (generally one year or less for residential units). Variable consideration such as reimbursement and fee is recognized as earned. Lease income is outside the scope of ASC 606. Hotel-related revenues (rooms, food and beverage, parking, and other ancillary services) are within the scope of ASC 606 and are recognized as described below. Hotel revenue recognition. We recognize hotel revenues in accordance with ASC 606. Room revenue is recognized over the stay as the services are provided; food and beverage, parking, and other ancillary revenues are recognized when the good or services are delivered. Package arrangements are allocated to performance obligations based on relative standalone selling prices. Advance deposits are recorded as contract liabilities and recognized as revenue when the related services are rendered or upon cancellation consistent with contract terms. We assess taxes collected from customers on a net basis (excluded from revenues). We do not adjust the transaction price for a financing component when the period between payment and performance is one year or less. The following table presents our Hotel revenue disaggregated by revenue streams: SCHEDULE OF HOTEL REVENUE DISAGGREGATION OF REVENUE For the year ended June 30, 2025 …

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NOTE 14 SEGMENT INFORMATION The Company operates in three reportable segments: (i) Hotel Operations (the Hilton San Francisco District and its five-level parking garage), (ii) Real Estate Operations (the multifamily and commercial rental portfolio), and (iii) Investment Transactions (investment of cash in marketable securities and other investments). CODM is a group of senior executives who collectively use these segments to evaluate performance and allocates resources. Segment results are evaluated using segment income (loss) from operations, which reflects revenues from external customers less segment operating expenses. This measure excludes interest expense, depreciation and amortization, gains/losses on extinguishment of debt, investment gains/losses, and income taxes, which are shown separately below. There are no intersegment revenues. Other consists primarily of unallocated corporate general and administrative costs and income taxes. All long-lived assets and revenues are attributable to operations in the United States. SCHEDULE OF SEGMENT REPORTING INFORMATION Hotel Real Estate Investment As of and for the year ended June 30, 2025 Operations Operations Transactions Other Total Revenues $ 46,363,000 $ 18,015,000 $ - $ - $ 64,378,000 Operating expenses (31,593,000 ) (4,158,000 ) - - (35,751,000 ) Utilities (3,210,000 ) (1,339,000 ) - - (4,549,000 ) Real estate taxes (1,912,000 ) (2,241,000 ) - - (4,153,000 ) Insurance (916,000 ) (1,812,000 ) - - (2,728,000 ) General an …

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NOTE 19 SUBSEQUENT EVENTS The Company evaluated subsequent events through the date that the accompanying financial statements were issued, and has determined that no other material subsequent events that require adjustment to or disclosure in the financial statements exist through the date of this filing, except as disclosed below. Regaining Nasdaq Listing Compliance On September 17, 2025, the Company received confirmation from Nasdaq that the Company has regained compliance with Listing Rule 5550(b)(2). Nasdaqs notice stated that, as of September 15, 2025, the Company had demonstrated 11 consecutive business days with a market value of listed securities above $ 35 million, thereby satisfying the requirement. As a result, the Panel granted the Companys request for continued listing, and the matter is now closed. One Big Beautiful Bill Act On July 4, 2025, the One Big Beautiful Bill was enacted (OBBBA), introducing significant and wide-ranging changes to the U.S. federal tax system. Significant components include restoration of 100% accelerated tax depreciation on qualifying property including expansion to cover qualified production property. Another major aspect incudes the return to immediate expensing of domestic research and experimental expenditures (R&E) which in some cases may include retroactive application back to 2021 for businesses with gross receipts of less than $31 million or accelerated tax deductions of R&E that was previously capitalized for larger bus …

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