NOTE 9 - RELATED PARTY AND OTHER FINANCING TRANSACTIONS

The following summarizes the balances of related party and other notes payable as of March 31, 2026 and June 30, 2025, respectively:

 SCHEDULE OF RELATED PARTY AND OTHER NOTES PAYABLE

InterGroup Revolving Credit Facility (Related Party)

On July 2, 2014, the Company (through its predecessor structure) secured an unsecured loan from The InterGroup Corporation (“InterGroup”), a related party, in the principal amount 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 received a loan fee equal to 3% of the principal. The loan was prepayable at any time without penalty and was extended through July 31, 2023. On December 16, 2020, the borrowing capacity was increased to $10,000,000. On December 31, 2021, following dissolution of the Partnership, Portsmouth assumed the outstanding obligation and its borrowing limit increased to $16,000,000.

In July 2023, maturity was extended to July 31, 2025, and capacity increased to $20,000,000 (0.5% modification fee). In March 2024, capacity increased to $30,000,000 (additional 0.5% modification fee on the incremental $10,000,000). In March 2025, capacity increased to $40,000,000 and maturity was extended to July 31, 2027. In May 2025, the interest rate was reduced to 9%. Principal and accrued interest are due at maturity; no monthly principal or interest payments are required prior to that date. As of March 31, 2026, the outstanding balance was $38,108,000. To date, the Company has not made any principal repayments on this note payable. See Note 2 – Liquidity for a summary. See Note 10 – Mortgage Notes Payable and Mezzanine Financing for the cash-management/lockbox provisions related to the Hotel financing.

Hilton Development Incentive (Other Financing)

The note payable to Hilton (the franchisor) is a self-exhausting, interest-free development incentive that is reduced by approximately $317,000 annually through January 2030 while the Company remains a Hilton franchisee.

Hotel Management Key Money

Under the February 1, 2017, Hotel Management Agreement (“HMA”) with Aimbridge Hospitality, Aimbridge advanced $2,000,000 of key money for capital improvements. The key money is amortized in equal monthly amounts over eight (8) years beginning on the second anniversary of the takeover date. The unamortized balance was $208,000 and $396,000 at March 31, 2026, and June 30, 2025, respectively, and is included in other notes payable in the condensed consolidated balance sheets.

Future minimum principal payments for all related party and other financing transactions are as follows:

 SCHEDULE OF FUTURE MINIMUM PRINCIPAL PAYMENTS

As of March 31, 2026 and June 30, 2025, the Company had accounts payable to InterGroup of $20,144,000 and $16,634,000, respectively, representing accrued interest and certain shared costs and expenses, primarily general and administrative expenses, rent, insurance, and other expenses.

Ownership and Governance

As of March 31, 2026, InterGroup owned approximately 75.9% of the outstanding common shares of Portsmouth, and John V. Winfield owned approximately 2.5% of Portsmouth’s outstanding common shares. Mr. Winfield also serves as the President, Chairman of the Board and Chief Executive Officer of InterGroup and owns approximately 68.8% of InterGroup’s outstanding common shares as of that date.

At March 31, 2026, the members of Portsmouth’s Board of Directors — John V. Winfield, William J. Nance, Andrew J. Kaplan, Yvonne Murphy, and Steve Grunwald — also serve as directors of InterGroup. Mr. Winfield served as Managing Director of Justice until its dissolution in December 2021. The Company’s President David C. Gonzalez also serves as Chief Operating Officer of InterGroup.

On January 6, 2026, John C. Love notified Portsmouth Square, Inc. of his resignation from the company’s Board of Directors, effective immediately. Mr. Love’s resignation was not the result of any disagreement with the company regarding its operations, policies, or practices.

On the same date, the Company’s Board of Directors appointed Andrew Kaplan to serve as a director of the Company, effectively immediately. These matters were previously disclosed in a Current Report on Form 8-K filed by the Company on January 9, 2026.

All related-party transactions are reviewed in accordance with the Company’s related-party transaction policy.