TPHS 10-K & 10-Q changes, risk factors and insider trading

After the RecapitalizationSteel Transaction, we have limited cash resources, our only source of revenuefunds is anthe assetSteel managementPromissory fee,Note, and are reliant on external sources of capital to fund ongoing operations.

Our prior revenue generating activities did not produce sufficient funds for profitable operations and working capital. Accordingly, our continued operation will require raising additional capital on acceptable terms. We have relied and will continue to rely substantially upon equity and debt financing and ourdraws assetunder managementthe feesSteel Promissory Note to fund our ongoing operations. There can be no assurance that additional sources of capital will be available to us on commercially favorable terms. In addition, our inability to access the capital markets on favorable terms, because of a low stock price, unfavorable market conditions or otherwise, will affect our ability to execute our business plan as scheduled. If we are unable to raise capital on market terms, our ability to run our operations and/or grow through new acquisitions and investments, and thus become profitable, will be materially adversely impacted.

Since our formation, we have generated limited revenues and had negative cash flow from operations. The development of our business plan has required, and willmay continue to require, substantial capital expenditures. There can be no assurance that our business will be successful, that we will be able to achieve or maintain a profitable operation, or that we will not encounter unforeseen difficulties that may deplete our capital resources more rapidly than anticipated. There can be no assurance that we will achieve or sustain profitability or positive cash flows from our operating activities.

Joint venture investments involve risks not otherwise present for investments made or owned solely, including the possibility that our joint venture partner might become bankrupt, or may take action contrary to our instructions, requests, policies or objectives. We own a 95% interest in TPHGreenwich, with the JV Investor owning the other 5% interest. However, under the Amended and Restated JV Operating Agreement, JV Investor, in its capacity as manager of TPHGreenwich, manages, controls and conducts the affairs of TPHGreenwich, subject only to certain limited major decisions set forth in the Amended and Restated JV Operating Agreement. In addition, distributions under the Amended and Restated JV Operating Agreement first will be paid to the Investor until it has received its initial distribution amount in full (including, but not limited to, all amounts due under the CCF and 77G Mezzanine Loan), following which such distributions will be distributed pro rata pursuant to the members’ respective percentage interests in TPHGreenwich. Further, if TPH Manager is terminated for “Cause” under the Asset Management Agreement, at the option of Investor, the Company’s right to distributions from TPHGreenwich will be forfeited and any distribution that would otherwise have been made to the Company will instead be distributed to the JV Investor.

OurTPHGreenwich’s revenues and the value of ourits portfolio are affected by a number of factors that affect investments in leased commercial and residential real estate generally.

We are subject to the general risks of investing in leasable real estate in connection with TPHGreenwich’s existing retail and residential properties. These risks include the ability of TPHGreenwich to secure leases with new tenants, renew leases with existing tenants, the non-performance of lease obligations by tenants, leasehold improvements that will be costly or difficult to remove or certain upgrades that may be needed should it become necessary to re-rent the leased space for other uses, rights of termination of leases due to events of casualty or condemnation affecting the leased space or the property or due to interruption of the tenant’s quiet enjoyment of the leased premises, and obligations of a landlord to restore the leased premises or the property following events of casualty or condemnation, and potentially, as occurred at 237 11th, damages arising from defective construction. The occurrence of any of these events, particularly with respect to leases at the commercial real estate property, or issues that affect numerous residential units, could adversely impact, and in the case of 237 11th, has adversely impacted, our results of operations, liquidity and financial condition.

In addition, if ourTPHGreenwich’s competitors offer space at net effective rental rates below our current net effective rental rates or market rates, TPHGreenwich may lose current or potential tenants to other properties in our markets. Additionally, TPHGreenwich may need to reduce net effective rental rates below current rates or offer incentives in order to retain tenants upon expiration of their leases or to attract new tenants. Our results of operations and cash flow may be adversely affected as a result of these factors.

WeAs of December 31, 2024, we had approximately $316.6$329.0 million of federal NOLs and $267.4$291.3 million of state NOLs and New York State and New York City prior NOL conversion subtraction pools of approximately $27.9 million and $22.9 million, respectively, as of December 31, 2023.respectively. Section 382 of the Internal Revenue Code (the “Code”), limits the ability of a company to utilize its NOLs after an ownership change. For purposes of Section 382, an ownership change occurs if the percentage of the stock of the company owned by persons holding 5% or more of the stock increases by more than 50 percentage points over a rolling three year lookback period. Generally, if an ownership change occurs, the annual taxable income limitation on our use of NOLs is equal to the product of the applicable long-term tax exempt rate and the value of our stock immediately before the ownership change. If we undergo an ownership change, our ability to utilize our NOLs would be subject to significant limitations. In addition, the 2017 tax legislation known as the Tax Cuts and Jobs Act (the “TCJA”) limited the deductibility of NOLs arising in tax years beginning after December 31, 2017 to 80 percent of taxable income (computed without regard to the net operating loss deduction) for the taxable year, and eliminated the ability of taxpayers to carryback such NOLs to prior years. These limitations were modified by the “Coronavirus Aid, Relief, and Economic Security (CARES) Act,” signed into law on March 27, 2020. The CARES Act suspended the 80% limitation on the use of NOLs for tax years beginning before January 1, 2021, and allowed losses arising in taxable years beginning after December 31, 2017 and before January 1, 2021 to be carried back up to five years.

We cannot predict how current and future political and economic uncertainty, including uncertainty related to taxation and increases in interest rates, will affect ourTPHGreenwich’s critical tenants, joint venture partners, lenders, financial institutions and general economic conditions, including consumer confidence and the volatility of the stock market and real estate market. In addition, we cannot predict the potential outbreak of contagious diseases in the future.

These issues may cause consumers to postpone discretionary spending in response to tighter credit, reduced consumer confidence and other macroeconomic factors affecting consumer spending behavior, resulting in a downturn in the business of ourTPHGreenwich’s tenants and an impact on potential purchases of our residential condominium units. In the event political and economic uncertainty results in financial turmoil affecting the banking system and financial markets or significant financial service institution failures, there could be a new or incremental tightening in the credit markets, low liquidity, and extreme volatility in fixed income, credit, currency and equity markets. Each of these could have an adverse effect on our business, financial condition and operating results.

We collect and retain on information technology systems certain financial, personal and other sensitive information provided by third parties, including tenants, vendors and employees. We also rely on information technology systems for the collection and distribution of funds.

In connection with the Recapitalization Transactions, the JV Investor acquired a five percent (5%) interest in and was appointed the initial manager of TPHGreenwich, which was a wholly-owned subsidiary of the Company holding directly or indirectly substantially all of the Company’s non-cash assets prior to the Recapitalization Transactions. Since we no longer hold a controlling interest in TPHGreenwich, the membership interest we hold in the JV could be deemed under the Investment Company Act to be an investment in investment securities, and, if such investment were to exceed 40% of our total assets, exclusive of U.S. government securities cash items and on an unconsolidated basis, and accordingly, we maycould be deemed to be an inadvertent investment company under such section 3(A)(1)(C). In that case, whether or not another exemption or exclusion from the Investment Company Act is available, we may choose to treat the Company as a transient investment company.company under Rule 3A-2 under the Investment Company Act.

A transient investment company can avoid being classified as an investment company if it can rely on one of the exclusions under the Investment Company Act. One such exclusion, Rule 3a-2 under the Investment Company Act, allows a transient investment company a grace period of one year from the earlier of (a) the date on which an issuer owns securities and/or cash having a value exceeding 50% of the issuer’s total assets on either a consolidated or unconsolidated basis and (b) the date on which an issuer owns or proposes to acquire investment securities having a value exceeding 40% of the value of such issuer’s total assets (exclusive of government securities and cash items) on an unconsolidated basis.basis to become compliant with Section 3(A)(1)(C) or otherwise find another exemption or exclusion from the definition of an investment company.

We believe that for purposes of valuing the membership interest we hold in the JV, the substantial indebtedness attributable to the real property assets owned directly or indirectly by the JV would materially reduce the value of such membership interest. In the event we are deemed to be aan transientinadvertent investment company as a result of the Recapitalization Transactions, we believe would qualify for the grace period. We may take actions to cause any investment securities held by us to be less than 40% of our total assets, which may include acquiring assets, engaging in one or more strategic transactions or liquidating our investment securities.

As Rule 3a-2 is available to a company no more than once every three years, and assuming no other exclusion were available to us, we would have to keep within the 40% limit for at least three years after wethe ceasegrace beingperiod aexpires transientunder investmentsuch company.rule. This may limit our ability to make certain investments or enter into joint ventures that could otherwise have a positive impact on our earnings. In any event, we do not intend to become an investment company engaged in the business of investing and trading securities.

Classification as an investment company under the Investment Company Act requires registration with the Securities and Exchange Commission (“SEC”). If an investment company fails to register, it would have to stop doing almost all business, and its contracts would become void or potentially voidable. Registration is time consuming and restrictive and would require a restructuring of our operations, and we would be very constrained in the kind of business we could do as a registered investment company. Further, we would become subject to substantial regulation concerning management, operations, transactions with affiliated persons and portfolio composition, and would need to file reports under the Investment Company Act regime. The cost of such compliance would result in our incurring substantial additional expenses, and the failure to register if required would have a materially adverse impact to conduct our operations.

Historically, we have incurred substantial indebtedness in furtherance of our activities, at both the parent company level and subsidiary level, resulting in an increased risk of default on our obligations and in an increase in debt service requirements, which could adversely affect our financial condition and results of operations. Following the Recapitalization Transactions, alla majority of the indebtedness is held by TPHGreenwich and/or its subsidiaries. As a result, TPHGreenwich is subject to the risks associated with debt financing, including the risk that its cash flow will be insufficient to meet required payments of principal and interest, the risk that TPHGreenwich may fail to repay or refinance existing debt as it matures, which may result in forced disposition of assets on disadvantageous terms or have other adverse consequences, and the risk that if TPHGreenwich refinances any of its debt, it may do so on refinancing terms less favorable than the terms of the existing debt.

Covenants in the loan agreements could limit TPHGreenwich’s flexibility and adversely affect ourits financial condition.

The loan agreements contain a number of financial and other restrictive covenants, including restrictions on debt, liens, business activities, equity repurchases, distributions and dividends, disposition of assets and transactions with affiliates, as well as financial covenants regarding loan to value and net worth. These covenants may limit TPHGreenwich’s flexibility to incur additional debt. If TPHGreenwich fails to meet or satisfy any of these covenants, it would be in default under these agreements and the indebtedness could be declared due and payable. In addition, the lenders could terminate their commitments, require the posting of additional collateral and enforce their interests against existing collateral. If TPHGreenwich were to default under the loan agreements, ourits financial condition would be adversely affected.

The CompanyLegacy Investor is the lender under the CCF, and an affiliate of the CompanyLegacy Investor and JV Investor is the lender under the 77G Mezzanine Loan, which could create a conflict of interest.

The CompanyLegacy Investor is the lender under the CCF, and an affiliate of the CompanyLegacy Investor and JV Investor is the lender under the 77G Mezzanine Loan. The JV Investor manages and controls TPHGreenwich, and as a result the Investor controls both the borrower and lender under these loan agreements, and accordingly conflicts of interest could arise. There is no assurance that any future actions by or transactions with the Investor or any of its affiliates will be on the same terms as those available with unaffiliated third parties or that these actions, agreements or relationships will be maintained at all or will not otherwise impact the Company in a manner that is adverse to us or our stockholders.

The business plan of TPHGreenwich includes in particular completion of the development of and the sale of condominiums at 77 Greenwich, which currently is its largest asset. As a result, TPHGreenwich’s, and in turn our, distribution of earnings from investmentsinvestments, are heavily dependent on the success of implementing the business plan for 77 Greenwich.

77 Greenwich consists of 90 luxury residential condominium apartments, in addition to a retail condominium unit and a New York City elementary school condominium unit. A variety of factors determine New York City residential condominium trends and will impact the sales and pricing of the residential condominium units at 77 Greenwich. These factors include, among others, available supply, changes in interest rates, the availability of home mortgages, foreign exchange rates, foreign buyer patterns, local employment trends, and prices and velocity of sales. Sales of residential condominium units in general, and in particular in New York City, have historically experienced greater volatility than detached single family houses, which may expose TPHGreenwich to more risk. These and other factors fluctuate over time. Based on a number of reports, there is a historically high number of unsold units in newly constructed luxury residential condominiums in New York City, which has resulted in demand and pricing pressures. When we commenced sales in the spring of 2019, the New York City market, in particular downtown Manhattan, was in a period of softness. This was exacerbated by the impact of the COVID-19 pandemic. Due to current market conditions in New York City, several competing residential condominium projects located in downtown Manhattan, specifically in the Financial District, have been put on hold while others have restarted construction. The status of unsold residential condominium units in 20232025 and beyond is inherently uncertain. Closings on sales commenced in September 2021 and are ongoing. An inability to successfully execute the business plan with respect to 77 Greenwich would likely have a material adverse effect on ourTPHGreenwich’s financial condition and results of operations.

Due to the TPHGreenwich’s core business of investing in, developing and operating real estate assets, there is an inherent risk that the development and sales of residential condominiums may be subject to unknown potential changes in internal and external financial and economic conditions, such as inflation and rising interest rates, and general market conditions which could impact the Company's business and potential buyers of the residential condominiums for sale. The Company believes it is possible for TPHGreenwich to incur real estate impairment charges in the future in the event these conditions deteriorate.

Leases at the properties owned by TPHGreenwich may not be renewed or such properties may not be re-leased at favorable rental rates. If the rental rates for the properties decrease, tenants do not renew their leases or TPHGreenwich does not re-lease a significant portion of available space, tenant defaults or space that is currently unoccupied, and space for which leases are scheduled to expire, ourits financial condition, results of operations and cash flows could be materially adversely affected. There are numerous commercial developers, real estate companies, financial institutions and other investors with greater financial resources that compete with usTPHGreenwich in seeking tenants who weit desiredesires to lease space in the properties.

The bankruptcy of, or a downturn in the business of, any of the major tenants at the commercial real estate properties that causes them to reject their leases, or to not renew their leases as they expire, or renew at lower rental rates, may adversely affect ourTPHGreenwich’s cash flows and property values. In addition, retailers at the properties face increasing competition from e-commerce, outlet malls, discount shopping clubs, direct mail and telemarketing, which could reduce rents payable to TPHGreenwich and reduce TPHGreenwich’s ability to attract and retain tenants at the properties leading to increased vacancy rates.

The properties ownedowned, or previously owned, by TPHGreenwich may be subject to known and unknown liabilities and with limited or no recourse to the seller.

Properties owned by TPHGreenwich may be subject to known or unknown liabilities with no or minimal recourse to the seller. As a result, if a property is damaged, TPHGreenwich may need to pay to have it repaired, and its ability to recover any such payments through insurance, indemnities, litigation or otherwise is uncertain. The Company acquired one property subject to unknown construction defects due to water penetration in the walls at 237 11th.11th, which was subsequently contributed to TPHGreenwich in the Recapitalization Transactions (and subsequently sold). During the pendency of repairs at 237 11th, units were unable to be leased, and following completion of repairs, they needed to be re-leased. If a liability was asserted against us or TPHGreenwich arising from the ownership of a property, we or TPHGreenwich might have to pay substantial sums to settle it. Unknown liabilities with respect to properties acquired might include:

With respect to certain types of properties in New York City, solely by virtue of the real estate tax exemption under RPTL Section 421-a, the Rent Guidelines Board of New York City, approves renewal lease rent increases. In 2023,2024, the Rent Guidelines Board approved a 3.00%2.75% increase on 12-month lease renewals and a 2.75%5.25% increase for the first year of 24-month lease renewals and 3.2% increase for the second year of 24-month lease renewals.

Each of the properties has been subject to varying degrees of environmental assessment. To date, these environmental assessments have not revealed any environmental condition material to our business. However, identification of new compliance concerns or undiscovered areas of contamination, changes in the extent or known scope of contamination, human exposure to contamination or changes in clean-up or compliance requirements could result in significant costs to us.TPHGreenwich.

The properties are subject to various federal, state and local regulatory requirements, such as state and local fire and life safety requirements. If TPHGreenwich fails to comply with these requirements, it could incur fines or private damage awards. We do not know whether existing requirements will change or whether compliance with future requirements will require significant unanticipated expenditures that will affect ourTPHGreenwich’s cash flow and results of operations.

Our common stock, currently listedquoted on the NYSEOver-the-Counter American,(OTC) Markets, is thinly traded. Because our common stock is thinly traded, even small trades can have a significant impact on the market price of our common stock, especially when there are limited buyers in the market. We cannot assure stockholders that an active market for our common stock will develop in the foreseeable future or, if developed, that it will be sustained. In addition, we may determine the benefits of listing our shares on the NYSE American do not merit the associated costs. As a result of these factors, stockholders may not be able to resell their common stock. Volatility in the market price of our common stock and lack of liquidity may prevent stockholders from being able to sell their shares at or above the price paid for such shares. The market price of our common stock could fluctuate significantly for various reasons, many of which are beyond our control, including:

We currently have fewer than 300 stockholders of record and, therefore, are eligible to terminateterminated the registration of our common stock under the Exchange Act and suspendsuspended being a U.S. public company with reporting obligations.

Under the Steel Stock Purchase Agreement, we have agreed to use reasonable efforts to complete the deregistration from the reporting obligations under Section 12 and Section 15 of the Exchange Act, including all associated reporting obligations, no later than one hundred and thirty-five (135) days following the closing of the Recapitalization Transactions, unless certain conditions under the Stock Purchase Agreement are met or as otherwise agreed by the parties. Section 12(g)(4) of the Exchange Act allows for the registration of any class of securities to be terminated after a company files a certification with the SEC that the number of holders of record of such class of security is fewer than 300 persons. As of MarchFebruary 29,18, 2024,2025, there were 134128 stockholders of record of our common stock. This does not include the number of shareholders that hold shares in “street name” through banks, brokers and other financial institutions. Accordingly, we arewere eligible to deregister our common stock and suspend our reporting obligations under the Exchange Act.Act Ifand, on February 18, 2025, filed a Form 15 with the SEC. As a result, we were to terminate our registration and suspend our reporting obligations under the Exchange Act, we wouldare no longer be required to comply with U.S. public company disclosure requirements under the Exchange Act, including, but not limited to, annual and quarterly report filings, proxy statement filings and filings by insiders to disclose the acquisition and disposition of our securities. This annual report on Form 10-K is our final periodic report filed under the Exchange Act.

We may issue additional equity securities in capital raising transactions or otherwise, resulting in the dilution of the ownership interests of our present stockholders. We are currently authorized to issue an aggregate of 120,000,000 shares of capital stock consisting of 79,999,997 shares of common stock, two shares of a class of preferred stock (which were redeemed in accordance with their terms and may not be reissued), one share of a class of special stock and 40,000,000 shares of blank check preferred stock. As of December 31, 2023,2024, there were 38,199,386 shares of our common stock, one share of special stock, and warrants to purchase 6,429,00065,314,726 shares of our common stock outstanding.and Inone connection with the Recapitalization Transactions, we issued 25,112,245 sharesshare of commonspecial stock to the Company Investor and the 6,429,000 warrants were cancelled.outstanding.

We have in the past and we may in the future raise additional capital through public or private offerings of our common stock or other securities that are convertible into or exercisable for our common stock. Any future issuance of our equity or equity-linked securities may dilute then-current stockholders’ ownership percentages and could also result in a decrease in the fair market value of our equity securities, because our assets would be owned by a larger pool of outstanding equity. We may also issue such securities in connection with hiring or retaining employees and consultants, as payment to providers of goods and services, in connection with future acquisitions and investments, development, redevelopment and repositioning of assets, or for other business purposes. Our board of directors may at any time authorize the issuance of additional common stock without stockholder approval, unless the approval of our common stockholders is required by applicable law, rule or regulation, including NYSE American regulations, or our certificate of incorporation. The terms of preferred or other equity or equity-linked securities we may issue in future transactions may be more favorable to new investors, and may include dividend and/or liquidation preferences, anti-dilution protection, pre-emptive rights, superior voting rights and the issuance of warrants or other derivative securities, among other terms, which may have a further dilutive effect. Our previously outstanding warrants also contained these types of provisions. Also, the future issuance of any such additional shares of common stock or other securities may create downward pressure on the trading price of our common stock. There can be no assurance that any such future issuances will not be at a price or have conversion or exercise prices below the price at which shares of the common stock are then traded.

If our stockholders sell, or the market perceives that our stockholders intend to sell for various reasons, including the ending of restrictions on resale of substantial amounts of our common stock in the public market, including shares issued upon the exercise of outstanding options, the market price of our common stock could fall. A significant amountnumber of restricted shares previously issued by us havehad been registered for resale on registration statements filed with the SEC.

More than 60% of our shares of common stock are controlled by three of our stockholders, including overapproximately 40% of our common stock being owned by theSteel CompanyPurchaser Investorsince followingFebruary the18, Recapitalization Transactions.2025. As a result, these stockholders may have the ability to significantly influence the outcome of issues submitted to our stockholders for a vote. The interests of these stockholders may not always coincide with our interests or the interests of other stockholders, and they may act in a manner that advances their best interests and not necessarily those of other stockholders. The concentration of ownership could also deter unsolicited takeovers, including transactions in which stockholders might otherwise receive a premium for their shares over then current market prices.

The holder of our special stock and the InvestorSteel Purchaser each have rights to appoint directors to our board of directors and, consequently, the ability to exert influence over us.

In connection with the investment in us by Third Avenue Trust, on behalf of Third Avenue Real Estate Value Fund (“Third Avenue”), Third Avenue was issued one share of a class of special stock and our certificate of incorporation was amended to provide that, subject to the other terms and conditions of our certificate of incorporation, from the issuance of the one share of special stock and until the “Special Stock Ownership Threshold” of 2,345,000 shares of common stock is no longer satisfied, Third Avenue has the right to elect one director to the board of directors. In addition, pursuant to the terms of the StockSteel PurchasePurchaser Stockholders’ Agreement, uponso thelong earlieras ofSteel (i)Purchaser theowns delistingat least 20% of the Company’s commonoutstanding stockcapital and (ii) three (3) months following the closing of the Recapitalization Transactions,stock, the Company mustwill take all action reasonably necessary to cause the board of directorsBoard to beremain reduced toat five (5) members, constitutedwhich shall include (A) one (1) director who shall qualify as follows:independent and is mutually agreed upon by Purchaser and the Company and (iB) two (2) membersdirectors appointeddesignated solely by Investor,Steel each of which may either be independent or interested, as determined by the Investor; (ii) two (2) members appointed by the Company, either or both of which may be current members of the board; and (iii) one (1) member to be mutually agreed upon and appointed by, the Company and Investor.Purchaser. As a result, for so long as these board appointment rights are in effect, Third Avenue and theSteel InvestorPurchaser may be able to exert influence over our policies and management, potentially in a manner which may not be in our best interests or the best interests of the other stockholders.

Under the FIRPTA Rules, we are a USRPHC because our interests in U.S. real property comprise at least 50% of the fair market value of our assets. Our common stock tradesis now traded on the NYSEOTC American.markets. So long as it continues to do so, and is regularly quoted by brokers or dealers makingAs a market in our common stock,result, our common stock willis beno longer treated as "regularly traded on an established securities market" (within the meaning of the FIRPTA Rules). As a result, (i) a non-U.S. investor who, actually or constructively, holds no more than 5% of our common stock would notmay be subject to U.S. federal income tax on the gain from the sale, exchange or other disposition of our common stock under the FIRPTA Rules, and (ii) a purchaser of such stock from a non-U.S. investor would notmay be required to withhold any portion of the purchase price of such stock, regardlessdepending ofon the percentage of our common stock held by such non-U.S. investor. Any of our common stockholders that are non-U.S. persons should consult their tax advisors to determine the consequences of investing in our common stock.

On February 14, 2024, we consummated the Recapitalization Transactionstransactions contemplated by the Stock Purchase Agreement, dated as of January 5, 2024 (as amended, the “Legacy Stock Purchase Agreement”), between the Company, TPHS Lender LLC, the Companylender under the Company’s Corporate Credit Facility ( “TPHS Lender”) and TPHS Investor LLC, an affiliate of TPHS Lender (the “JV Investor”, and together with TPHS Lender, the JV“Legacy Investor,Investor”), pursuant to which (i) the CompanyLegacy Investor purchased 25,112,245 shares of common stockstock, par value $0.01 per share of the Company (the “Legacy Investor Shares”) for a purchase price of $0.30 per share, (ii) the Company and the JV Investor entered into an amended and restated limited liability company operating agreement of TPHGreenwich (the “JV Operating Agreement,Agreement”), pursuant to which the JV Investor was appointed the initial manager of, and acquired a five percent (5%) interest in, TPHGreenwich, as described in more detail in “Item 1. Business”,below, and which JVTPHGreenwich continues to own, indirectly, all of the previously consolidated real property assets and liabilities of the Company, and (iii) TPHGreenwich entered into an asset management agreement (the “Asset Management Agreement”) with a newly formed subsidiary of the Company (the “TPH Manager, our wholly-owned subsidiary,Manager”), pursuant to which TPHGreenwich hired the TPH Manager to act as initial asset manager for TPHGreenwich for an annual management fee, as described in more detail inbelow (collectively, the “ItemRecapitalization 1. BusinessTransactions”).

Under thisthe Recapitalization Transactions, the real estate assets and related liabilities as well as the Corporate Credit Facility became part of TPHGreenwich, with the Company retaining the substantial federal, state and local tax NOLs, intellectual property and a 95% equity interest in TPHGreenwich. In addition, the maturity date of each of the mortgage loan agreement (the “77G Mortgage Loan”) and mezzanine loan agreement (the “77G Mezzanine Loan”) for 77 GreenwichGreenwich, both of which were assumed by TPHGreenwich, was extended to October 23, 2025 with an option to extend for an additional year, and the maturity date of the Corporate Credit Facility was extended to June 30, 2026.

Rental revenues in total increaseddecreased by approximately $440,000$5.1 million to $5.9 million$798,000 for the year ended December 31, 20232024, from $5.5$5.9 million for the year ended December 31, 2022.2023. This consisted of ana increasedecrease in rent revenues of approximately $469,000$5.0 million to $5.8$741,000 for the year ended December 31, 2024, from $5.7 million for the year ended December 31, 2023 from $5.3 million for the year ended December 31, 2022,2023, as well as a decrease in tenant reimbursements of approximately $29,000$139,000 to $57,000 for the year ended December 31, 2024, from $196,000 for the year ended December 31, 2023 from $225,000 for the year ended December 31, 2022.2023. The increasedecrease in total rental revenues and its related components was mainly due to higher base rents and fewer rent concessions at 237 11th during the year ended December 31, 2023 compared to the yearRecapitalization endedTransactions Decembermentioned 31,above 2022whereby dueTPHGreenwich tois completion of remediation ofrecording the constructionrental related defects in December 2021.revenues.

Other income decreased slightlyincreased by approximately $5,000$1.1 million to $1.3 million for the year ended December 31, 2024, from $177,000 for the year ended December 31, 20232023. from $182,000 forFor the year ended December 31, 2022.2024, Thisthis decreaseincome is due to a decrease inrepresents the SCA’s construction supervisionmanagement fee partiallyearned offsetfrom byTPHGreenwich. For the year ended December 31, 2023, this income was made up of a contractual payment received as a result of the cancelation of the purchase and sale agreement for the Paramus, New Jersey property in January 2023.2023, as well as the SCA’s construction supervision fee.

CostSales of sales – residential condominium units at 77 Greenwich decreased by approximately $8.0$26.1 million to $27.3$1.4 million for the year ended December 31, 20232024, from $35.2$27.5 million for the year ended December 31, 2022.2023. We closed on 10one and 14ten residential condominium units during the year ended December 31, 20232024 and 2022,2023, respectively. CostThe decrease in total sales of salesresidential consistscondominium ofunits constructionat and77 capitalizedGreenwich operatingwas costs that are allocateddue to the respectiveRecapitalization condominiumTransactions unitsmentioned beingabove sold,whereby asTPHGreenwich wellis asrecording closingthe costssales of the residential condominium units. Units that we closed on during 20222023 were generally lower priced, smaller units on the building’s lower floors, many of which entered into contract during the height of the pandemic.floors.

TransactionPension related costs increased by approximately $43,000$328,000 to $206,000$97,000 for the year ended December 31, 20232024, fromcompared $163,000to income of $231,000 for the year ended December 31, 2022.2023. These costs represent professional fees and other periodic pension costs incurred in connection with the underwritinglegacy andSyms evaluationPension ofPlan potential(see acquisitionsNote and9 investments– Pension Plan to our consolidated financial statements for transactionsfurther that were not consummated, as well as costs for potential leases at our retail properties that were not consummated.information).

Depreciation and amortization decreased by approximately $279,000$2.9 million to $771,000 for the year ended December 31, 2024, from $3.7 million for the year ended December 31, 20232024. fromThe $4.0decrease millionin fordepreciation and amortization expense was mainly due to the Recapitalization Transactions mentioned above whereby TPHGreenwich is recording the depreciation and amortization expense. For the year ended December 31, 2022.2024, depreciation and amortization expense consisted of depreciation for 237 11th of approximately $207,000, the amortization of lease commissions and acquired in-place leases of approximately $95,000 for 237 11th, the amortization of warrants of approximately $456,000 and depreciation for the corporate office furniture, fixtures and computer equipment of $13,000. For the year ended December 31, 2023, depreciation and amortization expense consisted of depreciation for the Paramus, New Jersey property of approximately $835,000, depreciation for 237 11th of approximately $1.7 million, the amortization of lease commissions and acquired in-place leases of approximately $770,000 for 237 11th, and amortization of warrants for $456,000. For the year ended December 31, 2022, depreciation and amortization expense consisted of depreciation for the Paramus, New Jersey property of approximately $1.1 million, depreciation for 237 11th of approximately $1.7 million, the amortization of lease commissions and acquired in-place leases of approximately $770,000 for 237 11th, and amortization of warrants of approximately $456,000.

Unrealized gainGain on warrantscontribution decreasedto byjoint venture was approximately $997,000 to $73,000 for the year ended December 31, 2023 from $1.1$21.0 million for the year ended December 31, 2022.2024, Thisand represents the changegain in the fair market valuationvalue of the warrantsCompany due mainlyrelating to the changeRecapitalization inTransactions ourthat stock priceclosed on theFebruary measurement14, date.2024.

Interest expense, net increaseddecreased by approximately $13.5$25.3 million to $3.9 million for the year ended December 31, 2024, from $29.2 million for the year ended December 31, 20232023. fromThe $15.7decrease millionin forinterest expense was due to the Recapitalization Transactions mentioned above whereby TPHGreenwich is recording the interest expense. For the year ended December 31, 2022.2024, there was approximately $3.9 million of gross interest expense incurred and no amounts were capitalized into residential condominium units for sale. For the year ended December 31, 2023, there was approximately $29.9 million of gross interest expense incurred, $689,000 of which was capitalized into residential condominium units for sale. For the year ended December 31, 2022, there was approximately $20.6 million of gross interest expense incurred, $4.9 million of which was capitalized into residential condominium units for sale. The increase in gross interest expense was mainly due to higher overall interest rates on our loans after December 31, 2022.

Interest expense - amortization of deferred finance costs increaseddecreased by approximately $578,000$2.7 million to $334,000 for the year ended December 31, 2024, from $3.0 million for the year ended December 31, 20232023, from $2.5 million for the year ended December 31, 2022. The increasewhich was principally due to lessthe capitalizedRecapitalization Transactions mentioned above whereby TPHGreenwich is recording the amortization of deferred finance costs for our loans as part of residential condominium units for sale.costs.

We recorded a$218,000 $183,000in tax expense for the year ended December 31, 20232024, compared to $288,000$183,000 for the year ended December 31, 2022.2023.

Net lossincome attributable to common stockholders increased by approximately $18.3$44.6 million to $5.6 million for the year ended December 31, 2024, from a net loss of $39.0 million for the year ended December 31, 2023 from $20.7 million for the year ended December 31, 2022.2023. This is a result of the changes discussed above, principally due to the increasedgain neton disposition recognized from the Recapitalization Transactions mentioned above and interest expense, amortizationpartially ofoffset deferredby financeequity costsin andnet increasedloss operatingfrom expenses at 77 Greenwich, as well as a smaller gain on the sale of ourunconsolidated joint venture property in 2023 compared to 2022.ventures.

As of December 31, 2023,2024, we had total cash and restricted cash of $8.3 million,$403,000, of which approximately $264,000$277,000 was cash and cash equivalents and approximately $8.1 million$126,000 was restricted cash.

Under the terms of the Amendment to Mr. Messinger’s Employment Agreement, Mr. Messinger agreed to continue his employment as chief executive officer until the filing of thisthe Company’s Quarterly Report on Form 10-Q.10-Q for the fiscal quarter ended March 31, 2024, and he transitioned from Chief Executive Officer of the Company to consultant to TPHGreenwich in August 2024. Mr. Messinger continues to serve as a member of the Board and also, for the time being, as interim principal executive officer for SEC purposes. The Company is currently evaluating next steps for identifying a new principal executive officer, however no replacement for Mr. Messinger has been identified as of the date of this filing. Given our limited cash position, it will be difficult for the Company to attract a replacement principal executive officer, and there is no assurance that our efforts will be successful. In addition, under the Sarbanes-Oxley Act, the Company is required to have a principal executive officer certify that our disclosure controls and procedures are effective in ensuring that material information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. If the Company is unable to identify a replacement principal executive officer, it will not be able to make its required filings with the SEC.

We also control a variety of intellectual property assets focused on the consumer sector, a legacy of our predecessor, Syms Corp. (“Syms”), including FilenesBasement.com, our rights to the Stanley Blacker® brand, as well as the intellectual property associated with the Running of the Brides® event and An Educated Consumer is Our Best Customer® slogan. In addition, we also had approximately $340.1$350.7 million of federal net operating loss carryforwards (“NOLs”) and other tax loss carryforwards at JuneSeptember 30, 2024, as well as approximately $362.1$382.7 million of various state and local NOLs and other tax loss carryforwards,carryforwards at September 30, 2024, which can be used to reduce our future taxable income and capital gains.

In the event Mr. Messinger fails to be involved in the day-to-day operations of the TPH Manager pursuant to the Asset Management Agreement, TPHGreenwich agrees its sole and exclusive remedy will be to terminate TPH Manager without cause on 30 days’ notice. As noted below and previously disclosed, Mr. Messinger will be transitioningtransitioned from CEOChief Executive Officer of the Company (i.e., TPH Manager) to consultant to TPHGreenwich.TPHGreenwich in August 2024. Mr. Messinger continues to serve as a member of the Board and also, for the time being, as interim principal executive officer for SEC purposes. While TPHGreenwich has not indicated an intention to terminate the Asset Management Agreement, however there is no assurance of how long the Asset Management Agreement will remain in effect.

On April 26, 2024, the Company and Mr. Messinger entered into an amendment (the “Amendment”) to Mr. Messinger’s employment agreement, dated as of October 1, 2013, as amended (the “Employment Agreement”), and TPHGreenwich and Mr. Messinger entered into a consulting agreement (the “Consulting Agreement”). Under the Amendment, the Company agreed to make certain payments to Mr. Messinger in exchange for Mr. Messinger’s agreement to continue his employment as chief executive officer of the Company until the later of July 31, 2024 or the filing of thisthe Quarterly Report on Form 10-Q,10-Q for the period ended June 30, 2024, unless extended by the parties (the “Termination Date”). As of September 30, 2024, Mr. Messenger has received $600,000 of these payments. The last payment due to Mr. Messinger was made subsequent to September 30, 2024. Upon the Termination Date, the Consulting Agreement will automatically becomebecame effective, unless the Employment Agreement is otherwise terminated in accordance with its terms.effective. Under the Consulting Agreement, Mr. Messinger has agreed to provide certain consulting services as an independent contractor to TPHGreenwich related to the properties owned by TPHGreenwich, in exchange for certain consulting payments. The Consulting Agreement will remain in effect until June 1, 2026, unless sooner terminated in accordance with its terms.

With the Company now unencumbered by its real estate and related liabilities, we continue to focus on exploring a range of strategic and financing alternatives to maximize stockholder value and to engage with parties that have expressed interest in the Company’s attributes and assets and may see the Company as a potential vehicle for growth, with potential opportunities to recapitalize the Company at a lower cost of capital. The Company previously engaged Houlihan Lokey and Ackman-Ziff to act as advisors (the “Advisors”) in connection with our strategic review process and to assist us in identifying and evaluating potential alternatives, including among others securing an equity and/or debt financing of the Company, refinancing of existing debt, and/or a sale or merger or reverse merger of the Company. The Company has entered into a letter of intent with an unaffiliated third party in connection with a potential strategic transaction. There is no assurance that we will be successful in consummating any such strategic transaction on terms or a timeframe acceptable to us or at all.all, with that party or any other party.

Below is certain information regarding the real estate properties held by TPHGreenwich as of JuneSeptember 30, 2024:

We entered into an agreement with the New York City School Construction Authority (the “SCA”), whereby we constructed a school sold to the SCA as part of our condominium development at 77 Greenwich. Pursuant to the agreement, the SCA agreed to pay us $41.5 million for the purchase of their condominium unit and reimburse us for the costs associated with constructing the school, including a construction supervision fee of approximately $5.0 million. Payments for construction are being made by the SCA to the general contractor in installments as construction on their condominium unit progresses. Payments to us for the land and construction supervision fee commenced in January 2018 and continued through October 2019 for the land and will continue through completion of the SCA buildout for the construction supervision fee. An aggregate of $46.4 million had been paid to us by the SCA as of JuneSeptember 30, 2024 with approximately $176,000 remaining to be paid to TPHGreenwich. We have also received an aggregate of $56.1 million in reimbursable construction costs from the SCA through JuneSeptember 30, 2024. In April 2020, the SCA closed on the purchase of the school condominium unit from us, at which point title transferred to the SCA. The SCA has completed the buildout of the interior space, which is a public elementary school with approximately 476 seats. The school received its final TCO and opened to students in September 2022.

(2) Paramus Property. The Paramus property consists of a one-story and partial two-story, 73,000 square foot freestanding building and an outparcel building of approximately 4,000 square feet, for approximately 77,000 total square feet of rentable space. The primary building is comprised of approximately 47,000 square feet of ground floor space, and two separate mezzanine levels of approximately 21,000 and 5,000 square feet. The 73,000 square foot building is leased to Restoration Hardware Holdings, Inc. (NYSE: RH) pursuant to a license agreement that began on June 1, 2016, is terminable upon three months’ notice, and currently is scheduled to end on March 31, 2025. The outparcel building was leased under a short-term license agreement with a tenant whose lease began on October 1, 2023 and ends DecemberJune 31,30, 2024.2025. The land area of the Paramus property consists of approximately 292,000 square feet, or approximately 6.7 acres. TPHGreenwich is currently exploring options with respect to a potential sale of the Paramus property.

As of JuneSeptember 30, 2024, TPHGreenwich had one retail license at its Paramus property encompassing 73,000 square feet of leased space with annualized rent of $540,000 per year and expiring in March 2025 and a short-term license for the outparcel building began October 1, 2023 and expiring on DecemberJune 31,30, 2024.2025. As of JuneSeptember 30, 2024, TPHGreenwich also had a retail lease at the 237 11th property encompassing 2,006 square feet of leased space with annualized rent of $130,000 per year that expires in 2027, a second retail lease at the 237 11th property encompassing 1,074 square feet of leased space with average annualized rent of $94,506 per year that expires in 2036 and a third retail lease at the 237 11th property encompassing 2,208 square feet of leased space with average annualized rent of $153,366 per year that expires in 2032. As of JuneSeptember 30, 2024, TPHGreenwich also had a retail lease at 77 Greenwich encompassing 1,061 square feet of leased space with an average annualized rent of $88,085 per year that expires in 2034. All TPHGreenwich’s other leases are residential leases most of which expire within twelve or twenty-four months of the commencement date.

The following discussion and analysis is intended to assist readers in understanding our financial condition and results of operations during the three and sixnine months ended JuneSeptember 30, 2024 and 2023 and should be read in conjunction with the consolidated financial statements and notes thereto included in this Quarterly Report on Form 10-Q and our 2023 Annual Report. As a result of the closing of the Recapitalization Transactions on February 14, 2024, the results of operations and the cash flows for the three and sixnine months ended JuneSeptember 30, 2024 compared to the three and sixnine months ended JuneSeptember 30, 2023 may not be comparable.

Results of Operations for the Three Months Ended JuneSeptember 30, 2024 Compared to the Three Months Ended JuneSeptember 30, 2023

There was no rental revenues for the three months ended JuneSeptember 30, 2024 as compared to total rental revenues of $1.4$1.5 million for the three months ended JuneSeptember 30, 2023. This is due to the Recapitalization Transactions mentioned above whereby TPHGreenwich is recording all of the rental revenue. For the three months ended JuneSeptember 30, 2023, rental revenues were approximately $1.4 million and tenant reimbursements were approximately $78,000.$46,000.

Other income increased by approximately $349,000$368,000 to $373,000$397,000 for the three months ended JuneSeptember 30, 2024 from $24,000$29,000 for the three months ended JuneSeptember 30, 2023. For the three months ended JuneSeptember 30, 2024, this income represents the management fee earned from TPHGreenwich. For the three months ended JuneSeptember 30, 2023, the income was from the SCA’s construction supervision fee.

There were no sales of residential condominium units at 77 Greenwich for the three months ended JuneSeptember 30, 2024 as compared to $5.2$9.2 million for the three months ended JuneSeptember 30, 2023. This is due to the Recapitalization Transactions mentioned above whereby TPHGreenwich is recording the sales of residential condominium units. We closed on twothree residential condominium units during the three months ended JuneSeptember 30, 2023. Units that we closed during 2023 were generally lower priced, smaller units on the building’s lower floors, many of which entered into contract during the height of the pandemic.floors.

Property operating expenses decreased by approximately $791,000$769,000 to $20,000$17,000 for the three months ended JuneSeptember 30, 2024 from $811,000$786,000 for the three months ended JuneSeptember 30, 2023. The decrease in property operating expenses was mainly due to the Recapitalization Transactions mentioned above as most of the operating expenses are recorded at TPHGreenwich. Property operating expenses consisted primarily of expenses incurred for utilities, payroll, and general operating expenses as well as repairs and maintenance and leasing commission at 237 11th, general operating expenses at 77 Greenwich, including marketing costs, and to a lesser extent expenses related to the Paramus, New Jersey property.

There was no real estate tax expense for the three months ended JuneSeptember 30, 2024 as compared to $451,000$668,000 for the three months ended JuneSeptember 30, 2023. The decrease in real estate tax expense was mainly due to the Recapitalization Transactions mentioned above as real estate tax expenses are recorded at TPHGreenwich. Real estate tax expense is predominately for 77 Greenwich and to a lesser extent for 237 11th and the Paramus, New Jersey property.

General and administrative expenses increaseddecreased by approximately $51,000$210,000 to $1.9$1.3 million for the three months ended JuneSeptember 30, 2024 from $1.8$1.5 million for the three months ended JuneSeptember 30, 2023. For the three months ended JuneSeptember 30, 2024, approximately $32,000$71,000 related to stock-based compensation, $912,000$738,000 related to payroll and payroll related expenses, $452,000$355,000 related to other corporate expenses, including board fees, corporate office rent and insurance and $490,000$137,000 related to legal, accounting and other professional fees. For the three months ended JuneSeptember 30, 2023, approximately $114,000$79,000 related to stock-based compensation, $651,000$609,000 related to payroll and payroll related expenses, $456,000$464,000 related to other corporate expenses, including board fees, corporate office rent and insurance and $614,000$359,000 related to legal, accounting and other professional fees.

Pension related costs decreased by approximately $22,000$48,000 to $265,000$96,000 for the sixthree months ended JuneSeptember 30, 2024 comparedfrom to $287,000$144,000 for the sixthree months ended JuneSeptember 30, 2023. These costs represent professional fees and other periodic pension costs incurred in connection with the legacy Syms Pension Plan (see Note 109 – Pension Plan to our consolidated financial statements for further information).

CostThere was no cost of sales – residential condominium units decreasedat by77 approximatelyGreenwich $16.1for millionthe three months ended September 30, 2024 as compared to $1.4$9.8 million for the sixthree months ended June 30, 2024 from $17.5 million for the six months ended JuneSeptember 30, 2023. We closed on one and seven residential condominium units during the six months ended June 30, 2024 and 2023, respectively. This decrease in costs of sales is due to the Recapitalization Transactions mentioned above whereby TPHGreenwich is recording the cost of sales of residential condominium units. We closed on three residential condominium units during the three months ended September 30, 2023. Cost of sales consists of construction and capitalized operating costs that are allocated to the respective condominium units being sold, as well as closing costs of the residential condominium units. Units that we closed during 2023 were generally lower priced, smaller units on the building’s lower floors, many of which entered into contract during the height of the pandemic.floors.

Depreciation and amortization decreased by approximately $1.2$1.0 million to $766,000$4,000 for the sixthree months ended JuneSeptember 30, 2024 from $2.0$1.0 million for the sixthree months ended JuneSeptember 30, 2024.2023. The decrease in depreciation and amortization expense was mainly due to the Recapitalization Transactions mentioned above whereby TPHGreenwich is recording the depreciation and amortization expense. For the sixthree months ended JuneSeptember 30, 2024, depreciation and amortization expense consisted of depreciation for 237 11th of approximately $208,000, the amortizationcorporate ofoffice leasefurniture, commissionsfixtures and acquiredcomputer in-place leases of approximately $96,000 for 237 11th and the amortization of warrants of approximately $452,000.equipment. For the sixthree months ended JuneSeptember 30, 2023, depreciation and amortization expense consisted of depreciation for the Paramus, New Jersey property of approximately $564,000,$284,000, depreciation for 237 11th of approximately $826,000,$416,000, the amortization of lease commissions and acquired in-place leases of approximately $385,000$192,000 for 237 11th, and amortization of warrants of approximately $228,000.$114,000.

Unrealized gain on warrants was $56,000$14,000 for the sixthree months ended JuneSeptember 30, 2023. This represents the change in the fair market valuation of the warrants due mainly to the change in our stock price on the measurement date.

InterestThere expense,was netno decreasedinterest byexpense approximatelyfor $9.6the millionthree months ended September 30, 2024 as compared to $3.9$7.9 million for the sixthree months ended June 30, 2024 from $13.5 million for the six months ended JuneSeptember 30, 2023. TheThis decrease in interest expense was mainlyis due to the Recapitalization Transactions mentioned above whereby TPHGreenwich is recording the interest expense. For the sixthree months ended JuneSeptember 30, 2024,2023, there was approximately $3.9$7.9 million of gross interest expense incurred and no amounts were capitalized into residential condominium units for sale. For the six months ended June 30, 2023, there was approximately $14.2 million of gross interest expense incurred, $689,000 of which was capitalized into residential condominium units for sale.

InterestThere was no interest expense - amortization of deferred finance costs decreasedfor approximatelythe $1.5three millionmonths ended September 30, 2024 as compared to $334,000$758,000 for the sixthree months ended JuneSeptember 30, 20242023. fromThis $1.8 million for the six months ended June 30, 2023 which was principallyis due to the Recapitalization Transactions mentioned above whereby TPHGreenwich is recording the amortization of deferred finance costs.

We recorded $140,000$51,000 in tax expense for the sixthree months ended JuneSeptember 30, 2024 comparedand tono $175,000expense for the sixthree months ended JuneSeptember 30, 2023.

Net incomeloss attributable to common stockholders increased bydecreased approximately $24.3$10.8 million to $7.1$1.1 million for the sixthree months ended JuneSeptember 30, 2024 fromas acompared lossto of $17.2$11.9 million for the sixthree months ended JuneSeptember 30, 2023. This is a result of the changes discussed above, principally due to the gain on disposition recognized from the Recapitalization Transactions mentioned above, partially offset by equity in net loss from unconsolidated joint ventures and interest expense.above.