Strategic Realty Trust, Inc. - Quarter Report: 2022 June (Form 10-Q)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_________________________________

FORM 10-Q

_________________________________

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2022


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 000-54376

_________________________________

STRATEGIC REALTY TRUST, INC.

(Exact name of registrant as specified in its charter)

_________________________________

Maryland

90-0413866

(State or Other Jurisdiction of
Incorporation or Organization)

(I.R.S. Employer Identification No.)

550 W Adams St, Suite 200

Chicago,

Illinois

60661

(Address of Principal Executive Offices)

(Zip Code)

(312) 878-4860

(Registrant’s Telephone Number, Including Area Code)

_________________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

None

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ý No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☐

Non-accelerated filer	ý	Smaller reporting company	☒

		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ý

As of August 8, 2022, there were 10,752,966 shares of the registrant’s common stock issued and outstanding.

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STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES

TABLE OF CONTENTS


		Page



































PART I — FINANCIAL INFORMATION		3

Item 1.	Unaudited Condensed Consolidated Financial Statements	4

	Condensed Consolidated Balance Sheets as of June 30, 2022 and December 31, 2021	4

	Condensed Consolidated Statements of Operations for the three and six months ended June 30 , 2022 and 2021	5

	Condensed Consolidated Statements of Equity for the three and six months ended June 30 , 2022 and 2021	6

	Condensed Consolidated Statements of Cash Flows for the six months ended June 30 , 2022 and 2021	7

	Notes to Condensed Consolidated Financial Statements	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	33

Item 4.	Controls and Procedures	33

PART II — OTHER INFORMATION

Item 1.	Legal Proceedings	34

Item 1A.	Risk Factors	34

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	34

Item 3.	Defaults Upon Senior Securities	34

Item 4.	Mine Safety Disclosures	34

Item 5.	Other Information	35

Item 6.	Exhibits	35

Signatures		36

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PART I

FINANCIAL INFORMATION

The accompanying interim unaudited condensed consolidated financial statements as of and for the three and six months ended June 30, 2022, have been prepared by Strategic Realty Trust, Inc. (the “Company”) pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) regarding interim financial reporting. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements and should be read in conjunction with the audited consolidated financial statements and related notes thereto included in the Company’s Annual Report on Form 10-K as of and for the year ended December 31, 2021, as filed with the SEC on March 25, 2022 (the “2021 Annual Report on Form 10-K”). The interim unaudited condensed consolidated financial statements herein should also be read in conjunction with the Notes to Condensed Consolidated Financial Statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in this Quarterly Report on Form 10-Q. The results of operations for the three and six months ended June 30, 2022, are not necessarily indicative of the operating results expected for the full year. The information furnished in the Company’s accompanying unaudited condensed consolidated balance sheets and unaudited condensed consolidated statements of operations, equity, and cash flows reflects all adjustments that, in management’s opinion, are necessary for a fair presentation of the aforementioned financial statements. Such adjustments are of a normal recurring nature.

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ITEM 1. UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except shares and per share amounts)

(unaudited)


	June 30,		December 31,

	2022		2021
ASSETS
Investments in real estate
Land	$	12,374	$	25,400
Building and improvements	22,334		27,550
Tenant improvements	1,132		1,753
	35,840		54,703
Accumulated depreciation	(4,956)		(5,148)
Investments in real estate, net	30,884		49,555
Property under development and development costs
Land	12,958		12,958

Development costs	687		3,189
Property under development and development costs	13,645		16,147
Cash, cash equivalents and restricted cash	1,378		2,407
Prepaid expenses and other assets	95		129
Tenant receivables, net of $19 and $83 bad debt reserve	788		844
Deferred leasing costs, net	205		270
Lease intangibles, net	346		500
Assets held for sale	16,119		—

TOTAL ASSETS (1)	$	63,460	$	69,852
LIABILITIES AND EQUITY
LIABILITIES
Notes payable, net	$	41,561	$	39,780
Accounts payable and accrued expenses	434		731
Amounts due to affiliates	62		63
Other liabilities	216		240

Below-market lease liabilities, net	119		130

TOTAL LIABILITIES (1)	42,392		40,944
Commitments and contingencies (Note 12)
EQUITY
Stockholders’ equity
Preferred stock, $0.01 par value; 50,000,000 shares authorized, none issued and outstanding	—		—
Common stock, $0.01 par value; 400,000,000 shares authorized; 10,752,966 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively	110		110
Additional paid-in capital	94,644		94,644
Accumulated deficit	(74,001)		(66,307)
Total stockholders’ equity	20,753		28,447
Non-controlling interests	315		461
TOTAL EQUITY	21,068		28,908
TOTAL LIABILITIES AND EQUITY	$	63,460	$	69,852

(1)As of June 30, 2022 and December 31, 2021, includes approximately $30.1 million and $34.8 million, respectively, of assets related to consolidated variable interest entities that can be used only to settle obligations of the consolidated variable interest entities and approximately $21.7 million and $21.5 million, respectively, of liabilities of consolidated variable interest entities for which creditors do not have recourse to the general credit of the Company. Refer to Note 3. “Variable Interest Entities”.

See accompanying notes to condensed consolidated financial statements.

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STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except shares and per share amounts)

(unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Revenue:
Rental and reimbursements	$	721	$	638	$	1,455	$	1,353

Expense:
Operating and maintenance	565		772		1,050		1,278
General and administrative	511		401		948		811
Depreciation and amortization	298		360		592		717

Interest expense	312		315		632		628
Loss on early lease termination	190		271		190		271
Loss on impairment of real estate	5,883		—		5,883		—
	7,759		2,119		9,295		3,705
Operating loss	(7,038)		(1,481)		(7,840)		(2,352)

Other income:


Net gain on disposal of real estate	—		422		—		422




Net loss	(7,038)		(1,059)		(7,840)		(1,930)
Net loss attributable to non-controlling interests	(131)		(21)		(146)		(38)
Net loss attributable to common stockholders	$	(6,907)	$	(1,038)	$	(7,694)	$	(1,892)

Loss per common share - basic and diluted	$	(0.64)	$	(0.10)	$	(0.72)	$	(0.18)

Weighted average shares outstanding used to calculate loss per common share - basic and diluted	10,752,966		10,739,729		10,752,966		10,739,729

See accompanying notes to condensed consolidated financial statements.

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STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(in thousands, except shares)

(unaudited)


Six Months Ended June 30, 2022 and 2021

	Number of Shares	Par Value		Additional Paid-in Capital		Accumulated Deficit		Total Stockholders’ Equity		Non-controlling Interests		Total Equity






BALANCE — December 31, 2021	10,752,966	$	110	$	94,644	$	(66,307)	$	28,447	$	461	$	28,908




Net loss	—	—		—		(7,694)		(7,694)		(146)		(7,840)
BALANCE — June 30, 2022	10,752,966	$	110	$	94,644	$	(74,001)	$	20,753	$	315	$	21,068

BALANCE — December 31, 2020	10,739,814	$	110	$	94,602	$	(55,771)	$	38,941	$	714	$	39,655




Net loss	—	—		—		(1,892)		(1,892)		(38)		(1,930)
BALANCE — June 30, 2021	10,739,814	$	110	$	94,602	$	(57,663)	$	37,049	$	676	$	37,725


Three Months Ended June 30, 2022 and 2021

	Number of Shares	Par Value		Additional Paid-in Capital		Accumulated Deficit		Total Stockholders’ Equity		Non-controlling Interests		Total Equity
BALANCE — March 31, 2022	10,752,966	$	110	$	94,644	$	(67,094)	$	27,660	$	446	$	28,106



Net loss	—	—		—		(6,907)		(6,907)		(131)		(7,038)
BALANCE — June 30, 2022	10,752,966	$	110	$	94,644	$	(74,001)	$	20,753	$	315	$	21,068


BALANCE — March 31, 2021	10,739,814	$	110	$	94,602	$	(56,625)	$	38,087	$	697	$	38,784




Net loss	—	—		—		(1,038)		(1,038)		(21)		(1,059)
BALANCE — June 30, 2021	10,739,814	$	110	$	94,602	$	(57,663)	$	37,049	$	676	$	37,725

See accompanying notes to condensed consolidated financial statements.

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STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)


	Six Months Ended June 30,
	2022		2021
Cash flows from operating activities:
Net loss	$	(7,840)	$	(1,930)
Adjustments to reconcile net loss to net cash used in operating activities:
Net gain on disposal of real estate	—		(422)


Loss on impairment of real estate	5,883		—

Straight-line rent	(84)		(29)
Amortization of deferred financing costs	192		206
Depreciation and amortization	592		717
Amortization of above and below-market leases	(10)		(11)
Provision for losses on tenant receivable	19		468
Loss on early lease termination	190		271
Other	42		—
Changes in operating assets and liabilities:
Prepaid expenses and other assets	34		67
Tenant receivables	22		(489)
Accounts payable and accrued expenses	(365)		(120)
Amounts due to affiliates	(1)		99
Other liabilities	(24)		618
Net cash used in operating activities	(1,350)		(555)

Cash flows from investing activities:


Proceeds from the sale of Real Estate	—		3,770
Investment in properties under development and development costs	(916)		(910)
Improvements and capital expenditures	(167)		(96)




Payments for leasing costs	(98)		(59)
Net cash provided by (used in) investing activities	(1,181)		2,705

Cash flows from financing activities:




Proceeds from notes payable from investments in consolidated variable interest entities	152		—

Loan proceeds from an affiliate	1,350		—




Net cash provided by financing activities	1,502		—

Net increase (decrease) in cash, cash equivalents and restricted cash	(1,029)		2,150
Cash, cash equivalents and restricted cash – beginning of period	2,407		2,622
Cash, cash equivalents and restricted cash – end of period	$	1,378	$	4,772

Supplemental disclosure of non-cash investing and financing activities and other cash flow information:

Change in accrued liabilities capitalized to investment in development	$	(22)	$	4

Amortization of deferred loan fees capitalized to investment in development	87		87


Changes in capital improvements and leasing costs, accrued but not paid	90		148

Cash paid for interest, net of amounts capitalized	385		427

See accompanying notes to condensed consolidated financial statements.

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STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

1. ORGANIZATION AND BUSINESS

Strategic Realty Trust, Inc. (the “Company”) was formed on September 18, 2008, as a Maryland corporation. Effective August 22, 2013, the Company changed its name from TNP Strategic Retail Trust, Inc. to Strategic Realty Trust, Inc. The Company believes it qualifies as a real estate investment trust (“REIT”) under the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), and has elected REIT status beginning with the taxable year ended December 31, 2009, the year in which the Company began material operations.

Since the Company’s inception, its business has been managed by an external advisor. The Company has no direct employees and all management and administrative personnel responsible for conducting the Company’s business are employed by its advisor. As of June 30, 2022, the Company was externally managed and advised by SRT Advisor, LLC, a Delaware limited liability company (the “Advisor”) pursuant to an advisory agreement with the Advisor (the “Advisory Agreement”) initially executed on August 10, 2013, and subsequently renewed every year through 2022. The current term of the Advisory Agreement terminates on August 9, 2023. The advisor is an affiliate of PUR Management LLC (“PUR”), which is an affiliate of L3 Capital, LLC. L3 Capital, LLC is a real estate investment firm focused on institutional quality, value-add, prime urban retail and mixed-use investment within first tier U.S. metropolitan markets.

Substantially all of the Company’s business is conducted through Strategic Realty Operating Partnership, L.P. (the “OP”). During the Company’s initial public offering (“Offering”), as the Company accepted subscriptions for shares of its common stock, it transferred substantially all of the net proceeds of the Offering to the OP as a capital contribution. The Company is the sole general partner of the OP. As of June 30, 2022 and December 31, 2021, the Company owned 98.1% of the limited partnership interests in the OP.

The Company’s principal demand for funds has been for the acquisition of real estate assets, the payment of operating expenses, interest on outstanding indebtedness, the payment of distributions to stockholders, and investments in development of properties. Substantially all of the proceeds of the Offering, which terminated in February 2013, have been used to fund investments in real properties and other real estate-related assets, for payment of operating expenses, for payment of interest, for payment of various fees and expenses, such as acquisition fees and management fees, and for payment of distributions to stockholders. The Company’s available capital resources, cash and cash equivalents on hand and sources of liquidity are currently limited. The Company expects its future cash needs will be funded using cash from operations, future asset sales, debt financing and the proceeds to the Company from any sale of equity that it may conduct in the future.

The Company invests in and manages a portfolio of income-producing retail properties, located in the United States, real estate-owning entities and real estate-related assets. The Company has invested directly, and indirectly through joint ventures, in a portfolio of income-producing retail properties located throughout the United States, with a focus on multi-tenant retail centers, including neighborhood, community and lifestyle shopping centers, multi-tenant shopping centers and free standing single-tenant retail properties. During the first quarter of 2016, the Company invested, through joint ventures, in two significant retail projects under development. During the third quarter of 2020, construction of one of the development projects was completed and placed in service. As of June 30, 2022, this property was classified as held for sale and had approximately 12,000 rentable square feet of retail space, which was 42% leased.

As of June 30, 2022, in addition to one development project and the property placed in service and currently classified as held for sale, the Company’s portfolio of wholly-owned properties was comprised of six properties, with approximately 27,000 rentable square feet of retail space located in California, as well as an improved land parcel. As of June 30, 2022, the rentable space at the Company’s retail properties was 88% leased, excluding the property placed in service and currently classified as held for sale.

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STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

COVID-19 Pandemic and Liquidity

The adverse effect of the public health crisis of the coronavirus disease (COVID-19) pandemic continues to pose material risk and uncertainty to the Company and the retail industry, which is the focus of the Company’s real estate investments. A majority of the Company’s tenants requested rent deferral or rent abatement at the start of the pandemic. Recently, some of the tenants have resumed paying full or partial rent. However, the Company is unable to predict the full impact that the pandemic will have on its financial condition, results of operations and cash flows which is dependent on the long-term impact of the pandemic on retail commercial real estate and whether customers will engage with the Company’s retail tenants at pre-pandemic levels.

Since the termination of the Offering in 2013, the Company’s cash flows have been primarily funded by cash provided by property operations, debt financings and the sales of properties. The COVID-19 pandemic has had a material detrimental impact on the Company’s retail tenants and their ability to pay rent and consequently on the Company’s liquidity. As of June 30, 2022, the Company had approximately $0.9 million in cash and cash equivalents. In addition, the Company had approximately $0.4 million of restricted cash (funds held by the lenders for property taxes, insurance, tenant improvements, leasing commissions, capital expenditures, rollover reserves and other financing needs). The Company has taken several steps to preserve capital and increase liquidity, such as:

•On March 27, 2020, the Company’s board of directors (the “Board”) decided to suspend the payment of any dividend for the quarter ending March 31, 2020, and will consider future dividend payments on a quarter by quarter basis. Dividend payments were not reinstated as of June 30, 2022.

•Effective May 21, 2020, the Company suspended its Amended and Restated Share Redemption Program (the “SRP”). The SRP will remain suspended and no further redemptions will be made unless and until the Board approves the resumption of the SRP.

•The Company obtained a $4.0 million unsecured loan from PUR Holdings Lender, LLC, an affiliate of the Advisor (the “Unsecured Loan”), to be used for working capital and other general corporate purposes. The Unsecured Loan does not have covenants that could trigger a default. Pursuant to the loan documents, the Unsecured Loan matures on December 30, 2022, with an option for the Company to extend the maturity date until June 30, 2023. On August 2, 2022, PUR Holdings Lender, LLC agreed to an additional six month extension at the option of the Company to extend the maturity date until December 31, 2023. As of June 30, 2022, there was approximately $1.6 million of unfunded commitment.

•The Company is actively exploring options to provide additional liquidity, such as a sale of one or more assets that are not generating positive cash flow. On August 10, 2022, the due diligence period expired under the Purchase and Sale Agreement the Company entered with an unrelated third-party for the sale of the Wilshire Joint Venture Property located in Santa Monica, California, for a sale price of $16.5 million. Pursuant to the Purchase and Sale Agreement, the purchaser would be obligated to purchase the property and the Company would be obligated to sell the property only after satisfaction of agreed upon closing conditions. The closing date is expected to be October 10, 2022. There can be no assurance that the Company will complete the sale. In certain circumstances, if the purchaser fails to complete the acquisition, it may forfeit up to approximately $0.5 million of earnest money. The Purchase and Sale Agreement was entered on June 30, 2022, and as a result, the Wilshire Joint Venture Property was classified as held for sale in the consolidated balance sheets as of June 30, 2022.

As of June 30, 2022, the Company was in compliance with all the terms of the Wilshire Construction Loan (as defined below). The Wilshire Construction Loan was scheduled to mature on May 10, 2022; however, the lender has informed us that the maturity date will be extended to November, 10, 2022 on the same terms and conditions as currently in effect. At June 30, 2022, the 3032 Wilshire Joint Venture Property, was classified as held for sale in the condensed consolidated balance sheets. Similarly, as of June 30, 2022, the Company was in compliance with the Sunset & Gardner Loan (as defined below), which matures on October 31, 2022.

The SRT Loan (as defined below) is secured by six of the Company’s core urban properties in Los Angeles and San Francisco. The SRT Loan does not have restrictive covenants that could trigger a default caused by tenants not paying rent or seeking rent relief. The SRT Loan has two extension options available subject to satisfaction of certain covenants and conditions, and while there is no guarantee of meeting the covenants and conditions, management believes they could exercise the extension options, or refinance the SRT loan if necessary.

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STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation and Basis of Presentation

The accompanying interim unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) as contained within the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) and the rules and regulations of the Securities and Exchange Commission (the “SEC”), including the instructions to Form 10-K and Regulation S-X.

The interim unaudited condensed consolidated financial statements include the accounts of the Company, the OP, their direct and indirect owned subsidiaries, and the accounts of joint ventures that are determined to be variable interest entities for which the Company is the primary beneficiary. All significant intercompany balances and transactions are eliminated in consolidation. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) necessary to present fairly the Company’s condensed consolidated financial position, results of operations and cash flows have been included.

The Company evaluates the need to consolidate joint ventures and variable interest entities based on standards set forth in ASC Topic 810, Consolidation (“ASC 810”). In determining whether the Company has a controlling interest in a joint venture or a variable interest entity and the requirement to consolidate the accounts of that entity, management considers factors such as ownership interest, authority to make decisions and contractual and substantive participating rights of the partners/members, as well as whether the entity is a variable interest entity for which the Company is the primary beneficiary. During the three and six months ended June 30, 2022 and 2021, the Company held variable interests in two variable interest entities, one of which is classified as held for sale, and consolidated those entities. Refer to Note 3. “Variable Interest Entities” for additional information.

Cash, Cash Equivalents and Restricted Cash

Cash and cash equivalents represent current bank accounts and other bank deposits free of encumbrances and having maturity dates of three months or less from the respective dates of deposit. The Company limits cash investments to financial institutions with high credit standing; therefore, the Company believes it is not exposed to any significant credit risk in cash.

Restricted cash includes escrow accounts for real property taxes, insurance, capital expenditures and tenant improvements, debt service and leasing costs held by lenders.

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported on the condensed consolidated balance sheets that sum to the total of the same such amounts shown on the condensed consolidated statement of cash flows (amounts in thousands):


	June 30, 2022		June 30, 2021
Cash and cash equivalents	$	948	$	3,967
Restricted cash	430		805
Total cash, cash equivalents, and restricted cash	$	1,378	$	4,772

Reclassifications

Certain prior period amounts have been reclassified to conform with current period’s presentation. The reclassifications had no effect on the Company’s condensed consolidated financial condition, results of operations, or cash flows.

Recent Accounting Pronouncements

The FASB issued the following ASUs, which could have potential impact to the Company’s condensed consolidated financial statements:

In July 2021, the FASB issued ASU No. 2021-05, Leases (Topic 842): Lessors - Certain Leases with Variable Lease Payments (“ASU 2021-05”). ASU 2021-05 amends the lease classification requirements for lessors to align them with practice under Topic 840. Lessors should classify and account for a lease with variable lease payments that do not depend on a reference index or a rate as an operating lease, if both of the following criteria are met: (1) the lease would have been classified as a sales-type lease or a direct financing lease; (2) the lessor would have otherwise recognized a day-one loss. ASU 2021-05 is effective for fiscal years beginning after December 31, 2021. The adoption of ASU 2021-05 on January 1, 2022, did not have an impact on the Company’s condensed consolidated financial statements.

In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”). ASU 2020-04 contains practical expedients for reference rate

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STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

reform related activities that impact debt, leases, derivatives and other contracts. The guidance in ASU No. 2020-04 is optional and may be elected over time through December 31, 2022. The Company is evaluating the impact of reference rate reform and whether it will apply any of these practical expedients.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (“ASU 2016-13”). ASU 2016-13 requires a financial asset, measured at amortized cost basis to be presented at the net amount expected to be collected. ASU 2016-13 was effective for fiscal years beginning after December 15, 2019, with adoption permitted for fiscal years beginning after December 15, 2018. Adjustments resulting from adopting ASU 2016-13 shall be applied through a cumulative-effect adjustment to retained earnings. In November 2019, the FASB issued ASU No. 2019-10, Financial Instruments—Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842) Effective Dates (“ASU 2019-10”). ASU 2019-10 extended the mandatory effective date for smaller reporting companies to beginning after December 15, 2022. The Company is evaluating the impact of Financial Instruments - Credit Losses on the Company’s condensed consolidated financial statements.

3. VARIABLE INTEREST ENTITIES

The Company has variable interests in, and is the primary beneficiary of, variable interest entities (“VIEs”) through its investments in (i) the Sunset & Gardner Joint Venture and (ii) the 3032 Wilshire Joint Venture. The Company has consolidated the accounts of these variable interest entities.

Through June 30, 2022, post the initial capital contributions, the Company made additional capital contributions totaling $9.0 million and $10.0 million to the Sunset & Gardner Joint Venture and Wilshire Joint Venture, respectively.

Assets Held for Sale

At June 30, 2022, the 3032 Wilshire Joint Venture Property, located in Santa Monica, California, was classified as held for sale in the condensed consolidated balance sheets.

Since the sale of this property does not represent a strategic shift that will have a major effect on the Company’s operations and financial results, the results of operations of this property were not reported as discontinued operations in the Company’s condensed consolidated financial statements.

The Company’s condensed consolidated statements of operations include net operating losses of approximately $2.8 million and $0.6 million for the three months ended June 30, 2022 and 2021, respectively, and approximately $3.2 million and $1.0 million for the six months ended June 30, 2022 and 2021, respectively, related to the asset held for sale.

There were no assets classified as held for sale at December 31, 2021.

The major classes of assets related to assets held for sale included in the condensed consolidated balance sheets are as follows (amounts in thousands):



	June 30,
	2022
ASSETS
Investments in real estate
Land	$	13,026
Building and improvements	2,866
Tenant improvements	614
	16,506
Accumulated depreciation	(611)
Investments in real estate, net	15,895

Tenant receivables, net	99
Deferred leasing costs, net	125

Assets held for sale	$	16,119

Amounts above are being presented at the lower of their carrying value or their estimated fair value less costs to sell.

Joint Ventures

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STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The following table reflects the aggregate assets and liabilities of the Sunset & Gardner Joint Venture and the Wilshire Joint Venture, excluding assets held for sale, which were consolidated by the Company, as of June 30, 2022 and December 31, 2021 (amounts in thousands):



	June 30,		December 31,
	2022		2021
ASSETS
Investments in real estate
Land	$	—	$	13,026
Building and improvements	—		5,218
Tenant improvements	—		467
	—		18,711
Accumulated depreciation	—		(520)
Investments in real estate, net	—		18,191
Property under development and development costs:
Land	12,958		12,958

Development costs	687		3,189
Property under development and development costs	13,645		16,147

Cash, cash equivalents and restricted cash	346		371
Prepaid expenses and other assets, net	2		13
Other receivables, net	—		69
Deferred leasing costs, net	—		29

TOTAL ASSETS (1)	$	13,993	$	34,820

LIABILITIES
Notes payable, net (2)	$	21,352	$	21,063
Accounts payable and accrued expenses	296		347
Amounts due to affiliates	—		4
Other liabilities	70		71
TOTAL LIABILITIES	$	21,718	$	21,485

(1)The assets of the Sunset & Gardner Joint Venture and Wilshire Joint Venture can be used only to settle obligations of the respective consolidated joint ventures.

(2)As of both June 30, 2022 and December 31, 2021, includes approximately $0.1 million and $0.2 million, respectively, of deferred financing costs, net, as a contra-liability. The creditors of the consolidated joint ventures do not have recourse to the general credit of the Company. The notes payable of the Wilshire Joint Venture is partially guaranteed by the Company, refer to Note 7, “Notes Payable, Net”. The notes payable of the Sunset & Gardner Joint Venture is not guaranteed by the Company.

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STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

4. LEASES

Operating Leases

The Company’s real estate properties are leased to tenants under operating leases for which the terms and expirations vary. As of June 30, 2022, the leases at the Company’s properties, excluding properties classified as held for sale, have remaining terms (excluding options to extend) of up to 9.9 years with a weighted-average remaining term (excluding options to extend) of approximately 6.2 years. The leases may have provisions to extend the lease agreements, options for early termination after paying a specified penalty, rights of first refusal to purchase the property at competitive market rates, and other terms and conditions as negotiated. The Company retains substantially all of the risks and benefits of ownership of the real estate assets leased to tenants. Generally, upon the execution of a lease, the Company requires security deposits from tenants in the form of a cash deposit and/or a letter of credit. Amounts required as security deposits vary depending upon the terms of the respective leases and the creditworthiness of the tenant, but generally are not significant amounts. Therefore, exposure to credit risk exists to the extent that a receivable from a tenant exceeds the amount of its security deposit. Security deposits received in cash related to tenant leases are included in other liabilities in the accompanying condensed consolidated balance sheets and totaled approximately $0.1 million as of June 30, 2022 and December 31, 2021, respectively.

The following table presents the components of income from real estate operations for the three and six months ended June 30, 2022 and 2021 (amounts in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Lease income - operating leases	$	480	$	463	$	1,057	$	1,057
Variable lease income (1)	241		175		398		296
Rental and reimbursements income	$	721	$	638	$	1,455	$	1,353

(1)Primarily includes tenant reimbursements for real estate taxes, insurance, consideration based on sales, common area maintenance, utilities, marketing, and certain other items including negative variable lease income.

As of June 30, 2022, the future minimum rental income from the Company’s properties under non-cancelable operating leases, excluding the property classified as held for sale, was as follows (amounts in thousands):


Remainder 2022	$	905
2023	1,833
2024	1,863
2025	1,757
2026	1,468
Thereafter	5,840
Total	$	13,666

5. LEASE INTANGIBLES AND BELOW-MARKET LEASE LIABILITIES, NET

As of June 30, 2022 and December 31, 2021, the Company’s above-market lease intangibles, at-market lease intangibles and below-market lease liabilities were as follows (amounts in thousands):


	June 30, 2022						December 31, 2021
	At-Market Lease Intangibles		Above-Market Lease Intangibles		Below-Market Lease Intangibles		At-Market Lease Intangibles		Above-Market Lease Intangibles		Below-Market Lease Intangibles
Cost	$	1,485	$	—	$	(388)	$	1,661	$	82	$	(388)
Accumulated amortization	(1,139)		—		269		(1,176)		(67)		258
Total	$	346	$	—	$	(119)	$	485	$	15	$	(130)

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STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Amortization of at-market lease intangible assets is recorded in depreciation and amortization expense and amortization of above-market rent and below-market rent is recorded as a reduction to and increase to rental and reimbursements, respectively, in the consolidated statements of operations. The Company’s amortization of above-market lease intangibles, at-market lease intangibles and below-market lease liabilities for the three and six months ended June 30, 2022 and 2021, were as follows (amounts in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Amortization
At-Market lease intangibles	$	(21)	$	(35)	$	(43)	$	(77)

Above-Market lease intangibles	$	—	$	(4)	$	(1)	$	(6)

Below-Market lease liabilities	$	6	$	8	$	11	$	17

6. DEFERRED LEASING COSTS, NET

Deferred leasing costs consist primarily of initial direct costs in connection with lease originations. We record amortization of deferred leasing costs on a straight-line basis over the terms of the related leases. As of June 30, 2022 and December 31, 2021, details of these deferred costs, excluding deferred leasing costs classified as held for sale, were as follows (amounts in thousands):


	June 30, 2022		December 31, 2021
Deferred leasing costs	$	296	$	350
Accumulated amortization	(91)		(80)
Deferred leasing costs, net	$	205	$	270

Amortization of deferred leasing costs is recorded in depreciation and amortization expense in the consolidated statements of operations. The Company’s deferred leasing costs amortization for the three and six months ended June 30, 2022 and 2021, were as follows (amounts in thousands):








	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Amortization of deferred leasing costs	$	(11)	$	(8)	$	(22)	$	(13)

7. NOTES PAYABLE, NET

On December 24, 2019, the Company entered into a Loan Agreement (the “SRT Loan Agreement”) with PFP Holding Company, LLC (the “SRT Lender”) for a non-recourse secured loan (the “SRT Loan”).

The SRT Loan is secured by first deeds of trust on the Company’s five San Francisco assets (Fulton Shops, 8 Octavia, 400 Grove, 450 Hayes and 388 Fulton Street) as well as the Company’s Silverlake Collection located in Los Angeles. The SRT Loan matures on January 9, 2023. The Company has an option to extend the term of the loan for two additional twelve-month periods, subject to the satisfaction of certain covenants and conditions contained in the SRT Loan Agreement. The Company has the right to prepay the SRT Loan in whole at any time or in part from time to time, subject to the payment of certain expenses, costs or liabilities potentially incurred by the SRT Lender as a result of the prepayment and subject to certain other conditions contained in the loan documents. Individual properties may be released from the SRT Loan collateral in connection with bona fide third-party sales, subject to compliance with certain covenants and conditions contained in the SRT Loan Agreement.

As of June 30, 2022, the SRT Loan had a principal balance of approximately $18.0 million. The SRT Loan is a floating Secured Overnight Financing Rate (“SOFR”) rate loan which bears interest at 30-day SOFR (with a floor of 1.50%) plus 2.80%. The default rate is equal to 5% above the rate that otherwise would be in effect. Monthly payments are interest-only with the entire principal balance and all outstanding interest due at maturity. Effective December 24, 2019, the Company entered into a derivative transaction with a financial institution with a notional amount of $18,000,000, representing an interest rate cap. The Company will receive a payment from the counterparty if the SOFR on the SRT Loan exceeds 3.5%. The instrument is measured at fair value using readily observable market inputs, such as quotations on interest rates, and classified as Level 2 as these instruments are custom, over-the-counter contracts with various bank counterparties that are not traded in an

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STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

active market. The Company paid $17 thousand for the derivative and it matures on January 9, 2023.The impact of the interest rate cap is immaterial for all periods reported and is included as a component of interest expense in the consolidated statements of operations.

Pursuant to the SRT Loan, the Company must comply with certain matters contained in the loan documents including but not limited to, (i) requirements to deliver audited and unaudited financial statements, SEC filings, tax returns, pro forma budgets, and quarterly compliance certificates, and (ii) minimum limits on the Company’s liquidity and tangible net worth. The SRT Loan contains customary covenants, including, without limitation, covenants with respect to maintenance of properties and insurance, compliance with laws and environmental matters, covenants limiting or prohibiting the creation of liens, and transactions with affiliates. At June 30, 2022, the Company was in compliance with the loan requirements.

In connection with the SRT Loan, the Company executed customary non-recourse carveout and environmental guaranties, together with limited additional assurances with regard to the condominium structures of the San Francisco assets.

On May 7, 2019, the Company refinanced and repaid its financing from Lone Oak Fund, LLC with a new construction loan from ReadyCap Commercial, LLC (the “Lender”) (the “Wilshire Construction Loan”). As of June 30, 2022, the Wilshire Construction Loan had a principal balance of approximately $12.7 million, with future funding available up to a total of approximately $13.9 million, and bears an interest rate of 1-month LIBOR (with a floor of 2.467%) plus an interest margin of 4.25% per annum, payable monthly. The Wilshire Construction Loan was scheduled to mature on May 10, 2022, with options to extend for two additional twelve-month periods, subject to certain conditions as stated in the loan agreement. The lender has informed us that the maturity date will be extended to November 10, 2022 on the same terms and conditions as currently in effect. The Wilshire Construction Loan is secured by a first Deed of Trust on the Wilshire Property. The Company executed a guaranty that guaranties that the loan interest reserve amounts are kept in compliance with the terms of the loan agreement. The Lender also required that a principal in the upstream owner of the Company’s joint venture partner in the Wilshire Joint Venture (the “Guarantor”), guarantees performance of borrower’s obligations under the loan agreement with respect to the completion of capital improvements to the property. The Company executed an Indemnity Agreement in favor of the Guarantor against liability under that completion guaranty except to the extent caused by gross negligence or willful misconduct, as well as for liabilities incurred under the Environmental Indemnity Agreement executed by the Guarantor in favor of the Lender. The Company used working capital funds of approximately $3.1 million to repay the difference between the Wilshire Construction Loan initial advance and the prior loan, to pay transaction costs, as well as to fund certain required interest and construction reserves.

Pursuant to the Wilshire Construction Loan, the Company must comply with certain matters contained in the loan documents including but not limited to minimum limits on the Company’s liquidity and tangible net worth. The Company remains in compliance with all the terms of the Wilshire Construction Loan. The Company expects to repay the Wilshire Construction Loan with the proceeds from the sale of the 3032 Wilshire Joint Venture Property.

On October 29, 2018, the Company entered into a loan agreement with Lone Oak Fund, LLC (the “Sunset & Gardner Loan”). The Sunset & Gardner Loan has a principal balance of approximately $8.7 million, and had an initial interest rate of 6.9% per annum. At each maturity date in October 2019, 2020, and 2021, in connection with an extension of the loan for an additional twelve-month period, the interest rate of the loan was changed to 6.5%, 7.3%, and 7.9%, respectively. The current maturity date of the Sunset & Gardner Loan is October 31, 2022. The Sunset & Gardner Loan is secured by a first Deed of Trust on the Sunset & Gardner Property.

As of June 30, 2022, the Unsecured Loan from PUR Holdings Lender, LLC, an affiliate of the Advisor, had an outstanding balance of approximately $2.4 million. Refer to Note 11. “Related Party Transactions” for further information.

The following is a schedule of future principal payments for all of the Company’s notes payable outstanding as of June 30, 2022 (amounts in thousands):


Remainder of 2022	$	23,761
2023	18,000

Total future principal payments	41,761
Unamortized financing costs, net	200
Notes payable, net	$	41,561

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STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The following table sets forth interest costs incurred by the Company for the periods presented (amounts in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Expensed
Interest costs, net of amortization of deferred financing costs	$	228	$	212	$	440	$	422
Amortization of deferred financing costs	84		103		192		206
Total interest expensed	$	312	$	315	$	632	$	628

Capitalized
Interest costs, net of amortization of deferred financing costs	$	396	$	354	$	779	$	707
Amortization of deferred financing costs	43		44		87		87
Total interest capitalized	$	439	$	398	$	866	$	794

As of June 30, 2022 and December 31, 2021, interest expense payable was approximately $0.3 million and $0.2 million, respectively, including an amount related to the variable interest entities of approximately $0.1 million, for each period.

8. FAIR VALUE DISCLOSURES

The Company believes the total carrying values reflected on its consolidated balance sheets for cash, cash equivalents and restricted cash, accounts receivable, accounts payable and accrued expenses, amounts due to affiliates, mortgage loan and construction loan secured by properties under development, and the Company’s multi-property secured financing, reasonably approximated their fair values based on their nature, terms, and interest rates that approximate current market rates at June 30, 2022.

As part of the Company’s ongoing evaluation of the Company’s real estate portfolio, the Company estimates the fair value of its investments in real estate by obtaining outside independent appraisals on all of the operating properties. The appraised values are compared with the carrying values of its real estate portfolio to determine if there are indications of impairment.

For the three and six months ended June 30, 2022, the Company recorded impairment losses of approximately $2.4 million and $3.5 million, related to the Wilshire Joint Venture Property and the development property owned by the Sunset & Gardner Joint Venture, respectively. For the Wilshire Joint Venture Property the impairment amount was determined using purchase price per the Purchase and Sale Agreement less estimated costs to sell. For the development property owned by the Sunset & Gardner Joint Venture the impairment amount was determined using Level 3 measurements, including the property’s undiscounted cash flow, which took into account the property’s expected cash flow from operations, anticipated holding period and estimated proceeds from disposition.

For the three and six months ended June 30, 2021, the Company did not record any impairment losses.

9. EQUITY

Share Redemption Program

On April 1, 2015, the Company’s board of directors approved the reinstatement of the share redemption program (which had been suspended since January 15, 2013). Under the SRP as reinstated, only shares submitted for repurchase in connection with the death or “qualifying disability” (as defined in the SRP) of a stockholder are eligible for repurchase by the Company. Under the SRP, as amended to date, the number of shares to be redeemed is limited to the lesser of (i) a total of $3.8 million for redemptions sought upon a stockholder’s death and a total of $1.2 million for redemptions sought upon a stockholder’s qualifying disability, and (ii) 5% of the weighted-average number of shares of the Company’s common stock outstanding during the prior calendar year. Share repurchases pursuant to the SRP are made at the sole discretion of the Company. The Company reserves the right to reject any redemption request for any reason or no reason or to amend or terminate the share redemption program at any time subject to the notice requirements in the SRP.

The redemption price for shares that are redeemed is 100% of the Company’s most recent estimated net asset value per share as of the applicable redemption date. A redemption request must be made within one year after the stockholder’s death or qualifying disability.

In order to preserve cash in response to the potential economic impact of COVID-19 on the Company, the board of directors approved the suspension of the SRP effective on May 21, 2020. The SRP will remain suspended and no further

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STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

redemptions will be made until the board of directors approves the resumption of the SRP. There is no guarantee if or when the board of directors will lift the suspension, and if they do, what the terms will be.

There were no share redemptions during the three and six months ended June 30, 2022 and 2021.

Cumulatively, through June 30, 2022, the Company has redeemed 878,458 shares for $6.2 million.

Quarterly Distributions

In order to qualify as a REIT, the Company is required to distribute at least 90% of its annual REIT taxable income, subject to certain adjustments, to its stockholders. Some or all of the Company’s distributions have been paid, and in the future may continue to be paid from sources other than cash flows from operations. The Company’s board of directors evaluates the Company’s ability to make quarterly distributions based on the Company’s operational cash needs.

In response to the COVID-19 pandemic, its impact on the economy and the related future uncertainty, on March 27, 2020, the board of directors of the Company voted to suspend the payment of any dividend for the quarter ending March 31, 2020, and to reconsider future dividend payments on a quarter by quarter basis. Dividend payments were not reinstated as of June 30, 2022.

10. EARNINGS PER SHARE

EPS is computed by dividing net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding during each period.

The following table sets forth the computation of the Company’s basic and diluted earnings per share for the three and six months ended June 30, 2022 and 2021 (amounts in thousands, except shares and per share amounts):


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Numerator - basic and diluted
Net loss	$	(7,038)	$	(1,059)	$	(7,840)	$	(1,930)
Net loss attributable to non-controlling interests	(131)		(21)		(146)		(38)
Net loss attributable to common shares	$	(6,907)	$	(1,038)	$	(7,694)	$	(1,892)
Denominator - basic and diluted
Basic weighted average common shares	10,752,966		10,739,729		10,752,966		10,739,729

Common Units (1)	—		—		—		—
Diluted weighted average common shares	10,752,966		10,739,729		10,752,966		10,739,729
Loss per common share - basic and diluted
Net loss attributable to common shares	$	(0.64)	$	(0.10)	$	(0.72)	$	(0.18)

(1)For the three and six months ended June 30, 2022 and 2021, the effect of 204,323 and 217,475 of convertible Common Units, respectively, pursuant to the redemption rights outlined in the Company’s registration statement on Form S-11 have not been included as they would not be dilutive.

11. RELATED PARTY TRANSACTIONS

On August 7, 2013, the Company entered into the Advisory Agreement with the Advisor, which has been renewed for successive terms with a current expiration date of August 9, 2023. The Advisor manages the Company’s business as the Company’s external advisor pursuant to the Advisory Agreement. Pursuant to the Advisory Agreement, the Company will pay the Advisor specified fees for services related to the investment of funds in real estate and real estate-related investments, management of the Company’s investments and for other services.

On December 30, 2021, the Company obtained the Unsecured Loan, a $4.0 million unsecured loan from PUR Holdings Lender, LLC, an affiliate of the Advisor. The Unsecured Loan has a term of 12 months with an interest rate of 7.0% per annum, compounding monthly with the ability to pay-off during the term of the loan. The Unsecured Loan requires draw downs in increments of no less than approximately $0.3 million. The Company has the right to prepay or repay the Unsecured Loan in whole or in part at any time without penalty. The Unsecured Loan will be due and payable upon the earlier of twelve months or the termination of the Advisory Agreement by the Company. On March 15, 2022, the Company and PUR Holdings Lender, LLC, amended the loan agreement to allow for an extension of the maturity date of the Unsecured Loan by six months, from December 30, 2022 to June 30, 2023, if the Company provides PUR Holdings Lender, LLC, with notice, pays an extension fee,

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STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

and no event of default has occurred. On August 2, 2022, PUR Holdings Lender, LLC agreed to an additional six month extension at the option of the Company to extend the maturity date until December 31, 2023. The Unsecured Loan is guaranteed by the Company. The Company paid $20 thousand in financing fees, at the close of the loan. As of June 30, 2022 the Unsecured Loan had an outstanding balance of approximately $2.4 million.

The Company is party to property management agreements with respect to each of its properties pursuant to which PUR was engaged to serve as property manager. The property management agreements expire August 10, 2022 and will automatically renew every year, unless expressly terminated.

Summary of Related Party Fees

The following table sets forth the Advisor related-party costs incurred and payable by the Company for the periods presented (amounts in thousands):


	Incurred								Payable as of
	Three Months Ended June 30,				Six Months Ended June 30,				June 30,		December 31,
Expensed	2022		2021		2022		2021		2022		2021

Legal leasing fees	$	—	$	2	$	—	$	2	$	—	$	—
Asset management fees	144		148		287		302		48		48
Reimbursement of operating expenses	—		—		14		—		—		—
Property management fees	31		15		55		35		14		11
Disposition fees	—		50		—		50		—		—

Total	$	175	$	215	$	356	$	389	$	62	$	59

Capitalized
Acquisition fees	$	—	$	3	$	—	$	5	$	—	$	4
Leasing fees	—		—		—		20		—		—
Legal leasing fees	—		—		—		10		—		—
Construction management fees	—		3		—		35		—		—

Total	$	—	$	6	$	—	$	70	$	—	$	4

Acquisition Fees

Under the Advisory Agreement, the Advisor is entitled to receive an acquisition fee equal to 1% of (1) the cost of each investment acquired directly by the Company or (2) the Company’s allocable cost of an investment acquired pursuant to a joint venture, in each case including purchase price, acquisition expenses and any debt attributable to such investments. An acquisition fee is capitalized by the Company when the related transaction does not qualify as a business combination; otherwise an acquisition fee is expensed.

Asset Management Fees

Under the Advisory Agreement, the Advisor is entitled to receive an asset management fee equal to a monthly fee of one-twelfth (1/12th) of 0.6% of the higher of (1) aggregate cost on a GAAP basis (before non-cash reserves and depreciation) of all investments the Company owns, including any debt attributable to such investments, or (2) the fair market value of the Company’s investments (before non-cash reserves and depreciation) if the board of directors has authorized the estimate of a fair market value of the Company’s investments; provided, however, that the asset management fee will not be less than $250,000 in the aggregate during any one calendar year.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Reimbursement of Operating Expenses

The Company reimburses the Advisor for all expenses paid or incurred by the Advisor in connection with the services provided to the Company, subject to the limitation that the Company will not reimburse the Advisor for any amount by which the Company’s total operating expenses (including the asset management fee described above) at the end of the four preceding fiscal quarters exceeded the greater of (1) 2% of its average invested assets (as defined in the Company’s Articles of Amendment and Restatement (the “Charter”)); or (2) 25% of its net income (as defined in the Charter) determined without reduction for any additions to depreciation, bad debts or other similar non-cash expenses and excluding any gain from the sale of the Company’s assets for that period (the “2%/25% Guideline”). The Advisor is required to reimburse the Company quarterly for any amounts by which total operating expenses exceed the 2%/25% Guideline in the previous expense year that the independent directors do not approve. The Company will not reimburse the Advisor for any of its personnel costs or other overhead costs except for customary reimbursements for personnel costs under property management agreements entered into between the OP and the Advisor or its affiliates. Notwithstanding the above, the Company may reimburse the Advisor for expenses in excess of the 2%/25% Guideline if a majority of the independent directors determine that such excess expenses are justified based on unusual and non-recurring factors.

For the three and six months ended June 30, 2022 and 2021, the Company’s total operating expenses (as defined in the Charter) did not exceed the 2%/25% Guideline.

Property Management Fees

Under the property management agreements the Company pays property management fees calculated at a maximum of up to 4% of the properties’ gross revenue.

Disposition Fees

Under the Advisory Agreement, if the Advisor or its affiliates provide a substantial amount of services, as determined by the Company’s independent directors, in connection with the sale of a real property, the Advisor or its affiliates may be paid disposition fees up to 50% of a customary and competitive real estate commission, but not to exceed 3% of the contract sales price of each property sold.

Leasing Fees

Under the property management agreements, the Company pays a separate fee for the leases of new tenants, and for expansions, extensions and renewals of existing tenants in an amount not to exceed the fee customarily charged by similarly situated parties rendering similar services in the same geographic area for similar properties.

Legal Leasing Fees

Under the property management agreements, the Company pays a market-based legal leasing fee for the negotiation and production of new leases, renewals, and amendments.

Construction Management Fees

In connection with the construction or repair in or about a property, the property manager is responsible for coordinating and facilitating the planning and the performance of all construction and in exchange the Company pays a fee equal to 5% of the hard costs for the project in question.

12. COMMITMENTS AND CONTINGENCIES

Economic Dependency

The Company is dependent on the Advisor and its affiliates for certain services that are essential to the Company, including the identification, evaluation, negotiation, purchase, and disposition of real estate and real estate-related investments, management of the daily operations of the Company’s real estate and real estate-related investment portfolio, and other general and administrative responsibilities. In the event that the Advisor is unable to provide such services to the Company, the Company will be required to obtain such services from other sources.

Environmental

As an owner of real estate, the Company is subject to various environmental laws of federal, state and local governments. The Company is not aware of any environmental liability that could have a material adverse effect on its condensed consolidated financial condition or results of operations. However, changes in applicable environmental laws and regulations, the uses and conditions of properties in the vicinity of the Company’s properties, the activities of its tenants and other

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

environmental conditions of which the Company is unaware with respect to the properties could result in future environmental liabilities.

13. SUBSEQUENT EVENTS

Renewal of Advisory Agreement

On August 12, 2022, the Company, the OP, and the Advisor, entered into the Tenth Amendment to the Advisory Agreement (the “Tenth Amendment”). The Tenth Amendment renews the term of the Advisory Agreement for an additional twelve-month period, beginning on August 10, 2022 and amends certain provisions in the Advisory Agreement with respect to the payment of certain fees as follows. The disposition fee payable to the Advisor will be reduced by half in connection with the sale of certain other properties held by the Company. The financing coordination fee payable to the Advisor will be waived in connection with certain upcoming refinancing’s. The asset management fee payable to the Advisor for the twelve-month period commending August 2022 through July 2023 will be reduced to $250,000 in the aggregate. In all other material respects, the terms of the Advisory Agreement remain unchanged.

Sale of Held for Sale Property

On August 10, 2022, the due diligence period expired under the Purchase and Sale Agreement and escrow instructions with an unrelated third-party, GD Realty Group Inc., for the sale of the Wilshire Joint Venture Property located in Santa Monica, California. The closing date is expected to be October 10, 2022. There can be no assurance that the Company will complete the sale. In certain circumstances, if the purchaser fails to complete the acquisition, it may forfeit up to approximately $0.5 million of earnest money.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis should be read in conjunction with our accompanying consolidated financial statements and the notes thereto.

As used herein, the terms “we,” “our,” “us,” and “Company” refer to Strategic Realty Trust, Inc., and, as required by context, Strategic Realty Operating Partnership, L.P., a Delaware limited partnership, which we refer to as our “operating partnership” or “OP”, and to their respective subsidiaries. References to “shares” and “our common stock” refer to the shares of our common stock.

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Special Note Regarding Forward-Looking Statements

Certain statements included in this Quarterly Report on Form 10-Q that are not historical facts (including any statements concerning investment objectives, other plans and objectives of management for future operations or economic performance, or assumptions or forecasts related thereto) are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These statements are only predictions. We caution that forward-looking statements are not guarantees. Actual events or our investments and results of operations could differ materially from those expressed or implied in any forward-looking statements. Forward-looking statements are typically identified by the use of terms such as “may,” “should,” “expect,” “could,” “intend,” “plan,” “anticipate,” “estimate,” “believe,” “continue,” “predict,” “potential” or the negative of such terms and other comparable terminology.

The forward-looking statements included herein are based upon our current expectations, plans, estimates, assumptions and beliefs, which involve numerous risks and uncertainties. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond our control. Although we believe that the expectations reflected in such forward-looking statements are based on reasonable assumptions, our actual results and performance could differ materially from those set forth in the forward-looking statements. The following are some of the risks and uncertainties, although not all of the risks and uncertainties, that could cause our actual results to differ materially from those presented in our forward-looking statements:

•The potential adverse effect of the ongoing public health crisis of the novel coronavirus disease (COVID-19) pandemic, or any future pandemic, epidemic or outbreak of infectious disease, on the financial condition, results of operations, cash flows and performance of the Company and its tenants, the real estate market, in particular with respect to retail commercial properties and the global economy and financial markets.

•Our executive officers and certain other key real estate professionals are also officers, directors, managers, key professionals and/or holders of a direct or indirect controlling interest in our advisor. As a result, they face conflicts of interest, including conflicts created by our advisor’s compensation arrangements with us and conflicts in allocating time among us and other programs and business activities.

•We are uncertain of our sources for funding our future capital needs. If we cannot obtain debt or equity financing on acceptable terms, our ability to continue to acquire real properties or other real estate-related assets, fund or expand our operations and pay distributions to our stockholders will be adversely affected.

•We depend on tenants for our revenue and, accordingly, our revenue is dependent upon the success and economic viability of our tenants. Revenues from our properties could decrease due to a reduction in tenants (caused by factors including, but not limited to, tenant defaults, tenant insolvency, early termination of tenant leases and non-renewal of existing tenant leases) and/or lower rental rates, making it more difficult for us to meet our financial obligations, including debt service and our ability to pay distributions to our stockholders.

•All our assets are concentrated in one state and in urban retail properties, any adverse economic, real estate or business conditions in this geographic area or in the urban retail market could affect our operating results and our ability to pay distributions to our stockholders.

•Our current and future investments in real estate and other real estate-related investments may be affected by unfavorable real estate market and general economic conditions, which could decrease the value of those assets and reduce the investment return to our stockholders. Revenues from our properties could decrease. Such events would make it more difficult for us to meet our debt service obligations and limit our ability to pay distributions to our stockholders.

•Certain of our debt obligations have variable interest rates with interest and related payments that vary with the movement of LIBOR or other indices. Increases in these indices could increase the amount of our debt payments and limit our ability to pay distributions to our stockholders.

All forward-looking statements should be read in light of the risks identified in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2021 (the “2021 Annual Report on Form 10-K”). Any of the assumptions underlying the forward-looking statements included herein could be inaccurate, and undue reliance should not be placed upon on any forward-looking statements included herein. All forward-looking statements are made as of the date of this Quarterly Report on Form 10-Q, and the risk that actual results will differ materially from the expectations expressed herein will increase with the passage of time. Moreover, you should interpret many of the risks identified in this Quarterly Report, as well as the risks set forth above, as being heightened as a result of the ongoing and numerous adverse impacts of the COVID-19 pandemic. Except as otherwise required by the federal securities laws, we undertake no obligation to publicly update or revise any

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forward-looking statements made after the date of this Quarterly Report on Form 10-Q, whether as a result of new information, future events, changed circumstances or any other reason. In light of the significant uncertainties inherent in the forward-looking statements included in this Quarterly Report on Form 10-Q, and the risks described in Part I, Item 1A of the 2021 Annual Report on Form 10-K, the inclusion of such forward-looking statements should not be regarded as a representation by us or any other person that the objectives and plans set forth in this Quarterly Report on Form 10-Q will be achieved.

Overview

We are a Maryland corporation that was formed on September 18, 2008, to invest in and manage a portfolio of income-producing retail properties, located in the United States, real estate-owning entities and real estate-related assets, including the investment in or origination of mortgage, mezzanine, bridge and other loans related to commercial real estate. During the first quarter of 2016, we also invested, through joint ventures, in two significant retail projects under development, one of which was substantially completed during the year ended December 31, 2020. We have elected to be taxed as a real estate investment trust (“REIT”) for federal income tax purposes, commencing with the taxable year ended December 31, 2009, and we have operated and intend to continue to operate in such a manner. We own substantially all of our assets and conduct our operations through our operating partnership, of which we are the sole general partner. We also own a majority of the outstanding limited partner interests in the operating partnership.

Since our inception, our business has been managed by an external advisor. We do not have direct employees and all management and administrative personnel responsible for conducting our business are employed by our advisor. Currently we are externally managed and advised by SRT Advisor, LLC, a Delaware limited liability company (the “Advisor”) pursuant to an advisory agreement with the Advisor (the “Advisory Agreement”) initially executed on August 10, 2013, and subsequently renewed every year through 2022. The current term of the Advisory Agreement terminates on August 9, 2023. The Advisor is an affiliate of PUR Management LLC, which is an affiliate of L3 Capital, LLC. L3 Capital, LLC is a real estate investment firm focused on institutional quality, value-add, prime urban retail and mixed-use investment within first tier U.S. metropolitan markets.

Impact of COVID-19 and Market Outlook

Since March 2020, COVID-19 and the efforts to contain its spread have significantly impacted the global economy, the U.S. economy, the economies of the local markets throughout California in which our properties are predominately located, and the broader financial markets. Nearly every industry has been impacted directly or indirectly, and the U.S. retail market has come under severe pressure due to numerous factors, including preventative measures taken by local, state and federal authorities to alleviate the public health crisis such as mandatory business closures, quarantines, restrictions on travel and shelter-in-place or stay-at-home orders. California, where all of our properties are located instituted various measures that required closure of retail businesses or limited the ability of our tenants to operate their businesses. As of June 30, 2021, the state of California lifted COVID-19 related restrictions. However, there remains uncertainty as to whether customers will re-engage with retail tenants at pre-pandemic levels. As a result of the containment measures instituted in response to the pandemic, some of our tenants have been experiencing hardships, as they were unable to operate at full capacity until the middle of June 2021.

We believe that the COVID-19 outbreak has and could continue to negatively impact our financial condition and results of operations, including but not limited to, declines in real estate rental revenues, the inability to sell certain properties at a favorable price, and a decrease in construction and leasing activity.

To mitigate the impact of COVID-19 on our operations and liquidity, we have taken a number of proactive measures, which include the following:

•We are in constant communication with our tenants and have assisted tenants in identifying local, state and federal resources that may be available to support their businesses and employees during the pandemic, including stimulus funds that may be available under the Coronavirus Aid, Relief, and Economic Security Act of 2020.

•We believe we will be able to service our debts and pay for our ongoing general and administrative expenses for the foreseeable future. As of June 30, 2022, we have approximately $0.9 million in cash and cash equivalents. In addition, we had approximately $0.4 million of restricted cash (funds held by the lenders for property taxes, insurance, tenant improvements, leasing commissions, capital expenditures, rollover reserves and other financing needs).

•On December 30, 2021, we obtained a $4.0 million unsecured loan (the “Unsecured Loan”) from PUR Holdings Lender, LLC, an affiliate of the Advisor. The Unsecured Loan has a term of 12 months with an interest rate of 7.0% per annum, compounding monthly with the ability to pay-off during the term of the loan. The Unsecured Loan requires draw downs in increments of no less than approximately $0.3 million. The Unsecured Loan will be due and payable upon the earlier of 12 months or the termination of the Advisory Agreement by us. On March 15, 2022, we and PUR

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Holdings Lender, LLC, amended the loan agreement to allow for an extension of the maturity date of the Unsecured Loan by six months, from December 30, 2022 to June 30, 2023, if we provide PUR Holdings Lender, LLC, with notice, pay an extension fee, and no event of default has occurred. On August 2, 2022, PUR Holdings Lender, LLC agreed to an additional six month extension at the option of the Company to extend the maturity date until December 31, 2023. The Unsecured Loan is guaranteed by us. As of June 30, 2022, the Unsecured Loan had an outstanding balance of approximately $2.4 million.

•The SRT Loan is secured by six of our core urban properties in Los Angeles and San Francisco. The SRT Loan does not have restrictive covenants and ongoing debt coverage ratios that could trigger a default caused by tenants not paying rent or seeking rent relief.

•As of June 30, 2022, we were in compliance with all the terms of the Wilshire Construction Loan (as defined below), which was scheduled to mature on May 10, 2022, with options to extend for two additional twelve-month periods, subject to certain conditions. The lender for the Wilshire Construction Loan has informed us that the maturity date will be extended to November 10, 2022. Similarly, as of June 30, 2022, we were in compliance with the Sunset & Gardner Loan (as defined below), which matures on October 31, 2022.

•We are actively exploring options to provide additional liquidity, such as a sale of one or more assets that are not generating positive cash flow. On August 10, 2022, the due diligence period expired under a Purchase and Sale Agreement we entered with an unrelated third-party for the sale of the Wilshire Joint Venture Property located in Santa Monica, California for a sale price of $16.5 million. Pursuant to the Purchase and Sale Agreement, the purchaser would be obligated to purchase the property and we would be obligated to sell the property only after satisfaction of agreed upon closing conditions. The closing date is expected to be October 10, 2022. There can be no assurance that we will complete the sale. In certain circumstances, if the purchaser fails to complete the acquisition, it may forfeit up to approximately $0.5 million of earnest money. The Purchase and Sale Agreement was entered on June 30, 2022, and as a result, the Wilshire Joint Venture Property was classified as held for sale in the consolidated balance sheets as of June 30, 2022.

•To further preserve cash and liquidity, we suspended our Amended and Restated Share Redemption Program (the “SRP”), effective on May 21, 2020. The SRP will remain suspended and no further redemptions will be made unless and until our board of directors (the “Board”) approves the resumption of the SRP. In addition, on March 27, 2020, the board of directors suspended the payment of any dividend for the quarter ending March 31, 2020, and will reconsider future dividend payments on a quarter-by-quarter basis. Dividend payments were not reinstated as of June 30, 2022.

Given the uncertainty of the COVID-19 pandemic’s impact on our business, the full extent of the financial impact cannot be reasonably estimated at this time. There remains uncertainty with respect to the demand for retail space and the success of our tenants given the potential change in consumer behavior as a result of the COVID-19 pandemic.

In addition, recent macroeconomic trends, including inflation and rising interest rates, may adversely affect our business, financial condition and results of operations. During the six months ended June 30, 2022, inflation in the United States has accelerated and is currently expected to continue at an elevated level in the near-term. Rising inflation could have an adverse impact on our variable rate debt or the refinancing of our fixed rate debt, as well as general and administrative expenses, as these costs could increase at a rate higher than our rental and other revenue. In addition, our retail tenants may experience decreased revenue as a result of rising inflation and reduced consumer spending. The Federal Reserve has recently started raising interest rates to combat inflation and restore price stability and it is expected that rates will continue to rise throughout the remainder of 2022. As a result, to the extent our exposure to increases in interest rates is not eliminated through interest rate swaps or other protection agreements, such increases may result in higher debt service costs, which will adversely affect our cash flows.

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Property Portfolio

As of June 30, 2022, our wholly-owned property portfolio included six retail properties, excluding a land parcel, which we refer to as “our properties” or “our portfolio,” comprising an aggregate of approximately 27,000 square feet of multi-tenant, commercial retail space located in one state. We purchased our properties for an aggregate purchase price of approximately $35.3 million. As of June 30, 2022 approximately 88% of our wholly-owned real estate investments were leased (based on rentable square footage), with a weighted-average remaining lease term of approximately 6.2 years. As of December 31, 2021, approximately 86% of our wholly-owned real estate investments were leased (based on rentable square footage as of December 31, 2021), with a weighted-average remaining lease term of approximately 6.3 years.


(dollars in thousands)		Rentable Square Feet	Percent Leased (2)		Effective Rent (3) (per Sq. Foot)		Date Acquired	Original Purchase Price		Debt (4)
Property Name (1)	Location
Wholly-owned Real Estate Investments

400 Grove Street	San Francisco, CA	2,000	100	%	$	48.00	6/14/2016	$	2,890	$	1,450
8 Octavia Street	San Francisco, CA	3,640	47	%	65.31		6/14/2016	2,740		1,500
Fulton Shops	San Francisco, CA	3,758	66	%	68.32		7/27/2016	4,595		2,200
450 Hayes	San Francisco, CA	3,724	100	%	98.97		12/22/2016	7,567		3,650
388 Fulton	San Francisco, CA	3,110	100	%	79.96		1/4/2017	4,195		2,300
Silver Lake	Los Angeles, CA	10,497	100	%	84.15		1/11/2017	13,300		6,900
		26,729						35,287		18,000
Real Estate Investments owned through Joint Ventures Held for Sale
3032 Wilshire Property	Santa Monica, CA	12,208	42	%	106.92		3/8/2016	13,500		12,711
		38,937						$	48,787	$	30,711

(1)List of properties does not include a residual parcel at Topaz Marketplace as of June 30, 2022.

(2)Percentage is based on leased rentable square feet of each property as of June 30, 2022.

(3)Effective rent per square foot is calculated by dividing the annualized June 30, 2022 contractual base rent by the total square feet occupied at the property. The contractual base rent does not include other items such as tenant concessions (e.g., free rent), percentage rent, and expense recoveries.

(4) Debt represents the outstanding balance as of June 30, 2022, and excludes reclassification of approximately $0.1 million deferred financing costs, net, as a contra-liability. For more information on our financing, refer to Note 7. “Notes Payable, Net” to our condensed consolidated financial statements included in this Quarterly Report.

Properties Under Development

As of June 30, 2022, we had one property under development in Hollywood, California. This development project is still in the planning phase and construction has not commenced.

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Results of Operations

Comparison of the three and six months ended June 30, 2022, versus the three and six months ended June 30, 2021.

The following table provides summary information about our results of operations for the three and six months ended June 30, 2022 and 2021 (amounts in thousands):


	Three Months Ended June 30,
	2022		2021		$ Change		% Change
Rental revenue and reimbursements	$	721	$	638	$	83	13.0	%
Operating and maintenance expenses	565		772		(207)		(26.8)	%
General and administrative expenses	511		401		110		27.4	%
Depreciation and amortization expenses	298		360		(62)		(17.2)	%

Interest expense	312		315		(3)		(1.0)	%
Loss on early lease termination	190		271		(81)		(29.9)	%
Loss on impairment of real estate	5,883		—		5,883		100.0	%
Operating loss	(7,038)		(1,210)		(5,557)		459.3	%
Other income, net	—		422		(422)		(100.0)	%

Net loss	$	(7,038)	$	(1,059)	$	(5,979)	564.6	%

	Six Months Ended June 30,
	2022		2021		$ Change		% Change
Rental revenue and reimbursements	$	1,455	$	1,353	$	102	7.5	%
Operating and maintenance expenses	1,050		1,278		(228)		(17.8)	%
General and administrative expenses	948		811		137		16.9	%
Depreciation and amortization expenses	592		717		(125)		(17.4)	%

Interest expense	632		628		4		0.6	%
Loss on early lease termination	190		271		(81)		(29.9)	%
Loss on impairment of real estate	5,883		—		5,883		100.0	%
Operating loss	(7,840)		(2,352)		(5,488)		233.3	%
Other income, net	—		422		(422)		(100.0)	%

Net loss	$	(7,840)	$	(1,930)	$	(5,910)	306.2	%

Our results of operations for the three and six months June 30, 2022, are not necessarily indicative of those expected in future periods.

Revenue

The increase in revenue during the three and six months ended June 30, 2022, compared to the same periods in 2021, was primarily due to the receipt of key money from new tenant as part of new lease agreement at the 388 Fulton property.

Operating and maintenance expenses

Operating and maintenance expenses decreased during the three and six months ended June 30, 2022, compared to the same periods in 2021, primarily due to lower bad debt reserves, write-off of uncollectible rents and lower consulting fees related to Wilshire Property development. Increase partially offset by higher security costs and leasing commissions.

General and administrative expenses

General and administrative expenses increased during the three and six months ended June 30, 2022, compared to the same period in 2021, primarily due to higher audit and other professional fees.

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Depreciation and amortization expenses

Depreciation and amortization expenses decreased during the three and six months ended June 30, 2022, compared to the same periods in 2021, primarily due to the impairment charge incurred during the year ended December 31, 2021 at the Wilshire Joint Venture Property.

Interest expense

Interest expense remained flat during the three and six months ended June 30, 2022, compared to the same period in 2021.

Loss on early lease termination

Loss on early lease termination during the three and six months ended June 30, 2022 related to the disposal of assets due to the termination of a tenant lease at the 388 Fulton property.

Loss on early lease termination during the three and six months ended June 30, 2021 related to the disposal of assets due to the termination of tenant leases at the 400 Grove, 450 Hayes, and Wilshire properties.

Loss on impairment of real estate

Loss on impairment of real estate related to the Wilshire Joint Venture and Sunset & Gardner Joint Venture of approximately $2.4 million and $3.5 million, respectively.

Other income, net

Other income, net for the three and six months ended June 30, 2021, consisted of a gain on sale of Shops at Turkey Creek of approximately $0.4 million.

Liquidity and Capital Resources

Since our inception, our principal demand for funds has been for the acquisition of real estate, the payment of operating expenses and interest on our outstanding indebtedness, the payment of distributions to our stockholders and investments in unconsolidated joint ventures and development properties. Prior to the termination of our initial public offering in February 2013 we used offering proceeds to fund our acquisition activities and our other cash needs. Currently we have used and expect to continue to use debt financing, net sales proceeds and cash flow from operations to fund our cash needs.

As of June 30, 2022, our cash and cash equivalents were approximately $0.9 million and we had $0.4 million of restricted cash (funds held by the lenders for property taxes, insurance, tenant improvements, leasing commissions, capital expenditures, rollover reserves and other financing needs).

Our aggregate borrowings, secured and unsecured, are reviewed by our board of directors at least quarterly. Under our Articles of Amendment and Restatement, as amended, which we refer to as our “charter,” we are prohibited from borrowing in excess of 300% of the value of our net assets. Net assets for purposes of this calculation is defined to be our total assets (other than intangibles), valued at cost prior to deducting depreciation, reserves for bad debts and other non-cash reserves, less total liabilities. However, we may temporarily borrow in excess of these amounts if such excess is approved by a majority of the independent directors and disclosed to stockholders in our next quarterly report, along with an explanation for such excess. As of June 30, 2022 and December 31, 2021, our borrowings were approximately 161.8% and 120.2%, respectively, of the value of our net assets.

The following table summarizes, for the periods indicated, selected items in our condensed consolidated statements of cash flows (amounts in thousands):


	Six Months Ended June 30,
	2022		2021		$ Change
Net cash provided by (used in):
Operating activities	$	(1,350)	$	(555)	$	(795)
Investing activities	(1,181)		2,705		(3,886)
Financing activities	1,502		—		1,502
Net increase (decrease) in cash, cash equivalents and restricted cash	$	(1,029)	$	2,150

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Cash Flows from Operating Activities

The change in cash flows from operating activities was primarily due to lower provisions for losses on tenant receivables, lower depreciation and amortization expense and the payment of accounts payable and accrued expenses related to repair work at the Silverlake Property and building improvements at the Wilshire Joint Venture Property during the six months ended June 30, 2022 as compared to the same period in 2021.

Cash Flows from Investing Activities

Cash flows used by investing activities during the six months ended June 30, 2022, primarily consisted of $0.9 million of additional investment in the Sunset and Gardner Joint Venture and $0.2 million additional investment in tenant and building improvements at the Wilshire Property.

Cash flows provided by investing activities during the six months ended June 30, 2021, primarily consisted of approximately $3.8 million in proceeds from the sale of Turkey Creek and partially offset by $0.9 million of additional investment in the Sunset and Gardner Joint Venture.

Cash Flows from Financing Activities

Cash flows provided by financing activities during the six months ended June 30, 2022, primarily consisted of proceeds of approximately $1.4 million from a draw down on the Unsecured Loan from PUR Holdings Lender, LLC, an affiliate of the Advisor. Additional cash was provided by construction loan proceeds of approximately $0.2 million.

Short-term Liquidity and Capital Resources

Our principal short-term demand for funds is for the payment of operating expenses and the payment on our outstanding indebtedness. To date, our cash needs for operations have been funded by cash provided by property operations, the sales of properties, debt refinancing, and the sale of shares of our common stock. We may fund our short-term operating cash needs from operations, from the sales of properties and from debt.

On December 30, 2021, in order to fund our short-term liquidity needs we obtained a $4.0 million Unsecured Loan from PUR Holdings Lender, LLC, an affiliate of the Advisor. The Unsecured Loan has a term of 12 months with an interest rate of 7.0% per annum, compounding monthly with the ability to pay-off during the term of the loan. The Unsecured Loan requires draw downs in increments of no less than approximately $0.3 million. The Unsecured Loan will be due and payable upon the earlier of 12 months or the termination of the Advisory Agreement by us. On March 15, 2022, we and PUR Holdings Lender, LLC, amended the loan agreement to allow for an extension of the maturity date of the Unsecured Loan by six months, from December 30, 2022 to June 30, 2023, if we provide PUR Holdings Lender, LLC, with notice, pay an extension fee, and no event of default has occurred. On August 2, 2022, PUR Holdings Lender, LLC agreed to an additional six month extension at the option of the Company to extend the maturity date until December 31, 2023. The Unsecured Loan is guaranteed by us.

On August 10, 2022, the due diligence period expired under a Purchase and Sale Agreement we entered with an unrelated third-party for the sale of the Wilshire Joint Venture Property located in Santa Monica, California for a sale price of $16.5 million. Pursuant to the Purchase and Sale Agreement, the purchaser would be obligated to purchase the property and we would be obligated to sell the property only after satisfaction of agreed upon closing conditions. The closing date is expected to be October 10, 2022. There can be no assurance that we will complete the sale. In certain circumstances, if the purchaser fails to complete the acquisition, it may forfeit up to approximately $0.5 million of earnest money. The Purchase and Sale Agreement was entered on June 30, 2022, and as a result, the Wilshire Joint Venture Property was classified as held for sale in the consolidated balance sheets as of June 30, 2022.

Long-term Liquidity and Capital Resources

On a long-term basis, our principal demand for funds will be for real estate and real estate-related investments, additional investment in our development projects and the payment of acquisition-related expenses, operating expenses, distributions to stockholders, future redemptions of shares and interest and principal payments on current and future indebtedness. Generally, we intend to meet cash needs for items other than acquisitions and acquisition-related expenses from our cash flow from operations, debt and sales of properties. On a long-term basis, we expect that substantially all cash generated from operations will be used to pay distributions to our stockholders after satisfying our operating expenses including interest and principal payments. We may consider future public offerings or private placements of equity. Refer to Note 7. “Notes Payable, Net” to our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for additional information on the maturity dates and terms of our outstanding indebtedness.

Our ability to access capital on favorable terms as well as to use cash from operations to continue to meet our liquidity needs could be affected by the continued effects of the COVID-19 pandemic, the current economic slowdown, the rising

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interest rate environment and inflation (or the public perception that any of these events may continue). The full impact of these events on our rental revenue and, as a result, future cash from operations cannot be determined at present.

We believe that our cash on hand, along with other potential aforementioned sources of liquidity that we may be able to obtain, will be sufficient to fund our working capital needs and debt obligations for at least the next twelve months and beyond. However, this forward-looking statement is subject to a number of uncertainties, including with respect to the duration of the COVID-19 pandemic, and the current economic environment and there can be no guarantee that we will be successful with our plan. Moreover, over the long term, if our cash flow from operations does not increase from current levels, we may have to address a liquidity deficiency. We are actively exploring options should cash flow from operations not sufficiently improve, including a sale of one or more assets that are not generating positive cash flow.

Recent Financing Transactions

Multi-Property Secured Financing

On December 24, 2019, we entered into a Loan Agreement (the “SRT Loan Agreement”) with PFP Holding Company, LLC (the “SRT Lender”) for a non-recourse secured loan (the “SRT Loan”).

The SRT Loan is secured by first deeds of trust on our five San Francisco assets (Fulton Shops, 8 Octavia, 400 Grove, 450 Hayes and 388 Fulton Street) as well as our Silverlake Collection located in Los Angeles. The SRT Loan matures on January 9, 2023. We have an option to extend the term of the loan for two additional twelve-month periods, subject to the satisfaction of certain covenants and conditions contained in the SRT Loan Agreement. We have the right to prepay the SRT Loan in whole at any time or in part from time to time, subject to the payment of certain expenses, costs or liabilities potentially incurred by the SRT Lender as a result of the prepayment and subject to certain other conditions contained in the loan documents. Individual properties may be released from the SRT Loan collateral in connection with bona fide third-party sales, subject to compliance with certain covenants and conditions contained in the SRT Loan Agreement.

Pursuant to the SRT Loan, we must comply with certain matters contained in the loan documents including but not limited to, (i) requirements to deliver audited and unaudited financial statements, SEC filings, tax returns, pro forma budgets, and quarterly compliance certificates, and (ii) minimum limits on our liquidity and tangible net worth. The SRT Loan contains customary covenants, including, without limitation, covenants with respect to maintenance of properties and insurance, compliance with laws and environmental matters, covenants limiting or prohibiting the creation of liens, and transactions with affiliates.

In connection with the SRT Loan, we executed customary non-recourse carveout and environmental guaranties, together with limited additional assurances with regard to the condominium structures of the San Francisco assets.

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Loans Secured by Properties

On May 7, 2019, we refinanced and repaid our financing with Lone Oak Fund, LLC with a new construction loan from ReadyCap Commercial, LLC (the “Lender”) (the “Wilshire Construction Loan”). As of June 30, 2022, the Wilshire Construction Loan had a principal balance of approximately $12.7 million, with future funding available up to a total of approximately $13.9 million, and bears an interest rate of 1-month LIBOR (with a floor of 2.467%) plus an interest margin of 4.25% per annum, payable monthly. The Wilshire Construction Loan was scheduled to mature on May 10, 2022, with options to extend for two additional twelve-month periods, subject to certain conditions as stated in the loan agreement. The lender has informed us that the maturity date will be extended to November 10, 2022. The Wilshire Construction Loan is secured by a first Deed of Trust on the Wilshire Property. We executed a guaranty that guaranties that the loan interest reserve amounts are kept in compliance with the terms of the loan agreement. The Lender also required that a principal in the upstream owner of our joint venture partner in the Wilshire Joint Venture (the “Guarantor”), guarantees performance of borrower’s obligations under the loan agreement with respect to the completion of capital improvements to the property. We executed an Indemnity Agreement in favor of the Guarantor against liability under that completion guaranty except to the extent caused by gross negligence or willful misconduct, as well as for liabilities incurred under the Environmental Indemnity Agreement executed by the Guarantor in favor of the Lender. We used working capital funds of approximately $3.1 million to repay the difference between the Wilshire Construction Loan initial advance and the prior loan, to pay transaction costs, as well as to fund certain required interest and construction reserves. The Company expects to repay the Wilshire Construction Loan with the proceeds from the sale of the 3032 Wilshire Joint Venture Property.

Loans Secured by Properties Under Development

On October 29, 2018, we entered into a loan agreement with Lone Oak Fund, LLC (the “Sunset & Gardner Loan”). The Sunset & Gardner Loan has a principal balance of approximately $8.7 million, and had an interest rate of 6.9% per annum. At each maturity date in October 2019, 2020 and 2021, in connection with an extension of the loan for an additional twelve-month period, the interest rate of the loan was changed to 6.5%, 7.3% and 7.0%, respectively. The current maturity date of the Sunset & Gardner Loan is October 31, 2022. The Sunset & Gardner Loan is secured by a first Deed of Trust on the Sunset & Gardner Property.

Loan with Affiliate

On December 30, 2021, we obtained a $4.0 million unsecured loan (the “Unsecured Loan”) from PUR Holdings Lender, LLC, an affiliate of the Advisor. The Unsecured Loan has a term of 12 months with an interest rate of 7.0% per annum, compounding monthly with the ability to pay-off during the term of the loan. The Unsecured Loan requires draw downs in increments of no less than approximately $0.3 million. The Unsecured Loan will be due and payable upon the earlier of 12 months or the termination of the Advisory Agreement by us. The Unsecured Loan is guaranteed by us. On March 15, 2022, we and PUR Holdings Lender, LLC, amended the loan agreement to allow for an extension of the maturity date of the Unsecured Loan by six months, from December 30, 2022 to June 30, 2023, if we provide PUR Holdings Lender, LLC, with notice, pay an extension fee, and no event of default has occurred. As of June 30, 2022 the Unsecured Loan had an outstanding balance of approximately $2.4 million.

Guidelines on Total Operating Expenses

We reimburse our Advisor for some expenses paid or incurred by our Advisor in connection with the services provided to us, except that we will not reimburse our Advisor for any amount by which our total operating expenses at the end of the four preceding fiscal quarters exceed the greater of (1) 2% of our average invested assets, as defined in our charter; and (2) 25% of our net income, as defined in our charter, or the “2%/25% Guidelines” unless a majority of our independent directors determines that such excess expenses are justified based on unusual and non-recurring factors. For the three and six months ended June 30, 2022 and 2021, our total operating expenses did not exceed the 2%/25% Guidelines.

Our Advisory Agreement provides that the Advisor shall not be required to reimburse to us any operating expenses incurred during a given period that exceed the applicable limit on “Total Operating Expenses” (as defined in the Advisory Agreement) to the extent that such excess operating expenses are incurred as a result of certain unusual and non-recurring factors approved by our board of directors.

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Inflation

The majority of our leases at our properties contain inflation protection provisions applicable to reimbursement billings for common area maintenance charges, real estate tax and insurance reimbursements on a per square foot basis, or in some cases, annual reimbursement of operating expenses above a certain per square foot allowance. We expect to include similar provisions in our future tenant leases designed to protect us from the impact of inflation. Due to the generally long-term nature of these leases, annual rent increases, as well as rents received from acquired leases, may not be sufficient to cover inflation and rent may be below market rates.

REIT Compliance

To qualify as a REIT for tax purposes, we are required to annually distribute at least 90% of our REIT taxable income, subject to certain adjustments, to our stockholders. We must also meet certain asset and income tests, as well as other requirements. If we fail to qualify as a REIT in any taxable year, we will be subject to federal income tax (including any applicable alternative minimum tax) on our taxable income at regular corporate rates and generally will not be permitted to qualify for treatment as a REIT for federal income tax purposes for the four taxable years following the year during which our REIT qualification is lost unless the IRS grants us relief under certain statutory provisions. Such an event could materially adversely affect our net income and net cash available for distribution to our stockholders.

Quarterly Distributions

As set forth above, in order to qualify as a REIT, we are required to distribute at least 90% of our annual REIT taxable income, subject to certain adjustments, to our stockholders. Our board of directors will continue to evaluate the amount of future quarterly distributions based on our operational cash needs.

Some or all of our distributions have been paid, and in the future may continue to be paid, from sources other than cash flows from operations.

In light of the COVID-19 pandemic, its impact on the economy and the related future uncertainty, on March 27, 2020, our board of directors determined to suspend the payment of any dividend for the quarters ending March 31, 2020, and to reconsider future dividend payments on a quarter by quarter basis. Dividend payments were not reinstated as of June 30, 2022.

Funds From Operations

Funds from operations (“FFO”) is a supplemental non-GAAP financial measure of a real estate company’s operating performance. The National Association of Real Estate Investment Trusts, or “NAREIT”, an industry trade group, has promulgated this supplemental performance measure and defines FFO as net income, computed in accordance with GAAP, plus real estate related depreciation and amortization and excluding extraordinary items and gains and losses on the sale of real estate, and after adjustments for unconsolidated joint ventures (adjustments for unconsolidated partnerships and joint ventures are calculated to reflect FFO.) It is important to note that not only is FFO not equivalent to our net income or loss as determined under GAAP, it also does not represent cash flows from operating activities in accordance with GAAP. FFO should not be considered an alternative to net income as an indication of our performance, nor is FFO necessarily indicative of cash flow as a measure of liquidity or our ability to fund cash needs, including the payment of distributions.

We consider FFO to be a meaningful, additional measure of operating performance and one that is an appropriate supplemental disclosure for an equity REIT due to its widespread acceptance and use within the REIT and analyst communities. Comparison of our presentation of FFO to similarly titled measures for other REITs may not necessarily be meaningful due to possible differences in the application of the NAREIT definition used by such REITs.

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Our calculation of FFO attributable to common shares and Common Units and the reconciliation of net income (loss) to FFO is as follows (amounts in thousands, except shares and per share amounts):


	Three Months Ended June 30,				Six Months Ended June 30,
FFO	2022		2021		2022		2021
Net loss	$	(7,038)	$	(1,059)	$	(7,840)	$	(1,930)
Adjustments:

Gain on disposal of assets	—		(422)		—		(422)

Depreciation of real estate	255		313		505		623
Amortization of in-place leases and leasing costs	43		47		87		94
Loss on impairment of real estate	5,883		—		5,883		—
FFO attributable to common shares and Common Units (1)	$	(857)	$	(1,121)	$	(1,365)	$	(1,635)

FFO per share and Common Unit (1)	$	(0.08)	$	(0.10)	$	(0.12)	$	(0.15)

Weighted average common shares and units outstanding (1)	10,957,289		10,957,204		10,957,289		10,957,204

(1)Our common units have the right to convert a unit into common stock for a one-to-one conversion. Therefore, we are including the related non-controlling interest income/loss attributable to common units in the computation of FFO and including the common units together with weighted average shares outstanding for the computation of FFO per share and common unit.

Related Party Transactions and Agreements

We are currently party to the Advisory Agreement, pursuant to which the Advisor manages our business in exchange for specified fees paid for services related to the investment of funds in real estate and real estate-related investments, management of our investments and for other services. Refer to Note 11. “Related Party Transactions” to our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for a discussion of the Advisory Agreement and other related party transactions, agreements and fees.

Critical Accounting Policies and Estimates

Our interim unaudited condensed consolidated financial statements have been prepared in accordance with GAAP and in conjunction with the rules and regulations of the SEC. The preparation of our financial statements requires significant management judgments, assumptions and estimates about matters that are inherently uncertain. These judgments affect the reported amounts of assets and liabilities and our disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods. With different estimates or assumptions, materially different amounts could be reported in our financial statements. Additionally, other companies may utilize different estimates that may impact the comparability of our results of operations to those of companies in similar businesses. A discussion of additional accounting policies that management considers critical in that they involve significant management judgments, assumptions and estimates is included in our 2021 Annual Report on Form 10-K.

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Subsequent Events

Renewal of Advisory Agreement

On August 12, 2022, we, our operating partnership, and the Advisor entered into the Tenth Amendment to the Advisory Agreement (the “Tenth Amendment”). The Tenth Amendment renews the term of the Advisory Agreement for an additional twelve-month period, beginning on August 10, 2022 and amends certain provisions in the Advisory Agreement with respect to the payment of certain fees as follows. The disposition fee payable to the Advisor will be reduced by half in connection with the sale of certain other properties held by us. The financing coordination fee payable to the Advisor will be waived in connection with the refinancing certain upcoming refinancing’s. The asset management fee payable to the Advisor for the twelve-month period commending August 2022 through July 2023 will be reduced to $250,000 in the aggregate. In all other material respects, the terms of the Advisory Agreement remain unchanged.

Sale of Held for Sale Property

On August 10, 2022, the due diligence period expired under the Purchase and Sale Agreement and escrow instructions with an unrelated third-party, GD Realty Group Inc., for the sale of the Wilshire Joint Venture Property located in Santa Monica, California. The closing date is expected to be October 10, 2022. There can be no assurance that we will complete the sale. In certain circumstances, if the purchaser fails to complete the acquisition, it may forfeit up to approximately $0.5 million of earnest money.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Omitted as permitted under rules applicable to smaller reporting companies.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

As of the end of the period covered by this report, management, including our chief executive officer and chief financial officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based upon, and as of the date of, the evaluation, our chief executive officer and chief financial officer concluded that the disclosure controls and procedures were effective as of the end of the period covered by this report to ensure that information required to be disclosed in the reports we file and submit under the Exchange Act is recorded, processed, summarized and reported as and when required. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports we file and submit under the Exchange Act is accumulated and communicated to our management, including our chief executive officer and our chief financial officer, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control Over Financial Reporting

There have been no changes in our internal control over financial reporting that occurred during the quarter ended June 30, 2022, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II

ITEM 1. LEGAL PROCEEDINGS

None.

ITEM 1A. RISK FACTORS

Omitted as permitted under rules applicable to smaller reporting companies.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

During the period covered by this Quarterly Report on Form 10-Q, we did not issue any equity securities that were not registered under the Securities Act of 1933, as amended.

Share Redemption Program

Our board of directors has adopted a share redemption program that may enable our stockholders to sell their shares of common stock to us in limited circumstances (the “SRP”), subject to the significant restrictions and limitations of the program. The current SRP is available only for shares submitted for repurchase in connection with the death or “qualifying disability” (as defined in the SRP) of a stockholder. In addition, under the SRP, the number of shares to be redeemed is limited to the lesser of (i) a total of $3.8 million for redemptions sought upon a stockholder’s death and a total of $1.2 million for redemptions sought upon a stockholder’s qualifying disability, and (ii) 5% of the weighted-average number of shares of our common stock outstanding during the prior calendar year. Share repurchases pursuant to the SRP are made at our sole discretion. We reserve the right to reject any redemption request for any reason or no reason or to amend or terminate the share redemption program at any time subject to the notice requirements in the SRP.

The redemption price for shares that are redeemed is 100% of our most recent estimated net asset value per share as of the applicable redemption date. A redemption request must be made within one year after the stockholder’s death or qualifying disability. Additional information regarding the terms and limitations of the SRP is available in our Amended and Restated Share Redemption Program which is included in this Quarterly Report on Form 10-Q as Exhibit 99.1.

In order to preserve cash in light of the uncertainty relating to the economic impact of COVID-19 on our operations, on April 21, 2020, the Board approved the suspension of the SRP, effective on May 21, 2020. The SRP will remain suspended and no further redemptions will be made until the board of directors approves the resumption of the SRP. During the suspension, we will continue to accept death and qualifying disability redemption filings from stockholders, but will not take any action with regard to those requests until the board of directors has elected to lift the suspension and provided the terms and conditions for any continuation of the SRP.

During the quarter ended June 30, 2022, we did not redeem shares. Cumulatively, through June 30, 2022, we have redeemed 878,458 shares for $6.2 million. We have not presented information regarding submitted and unfulfilled redemption requests for the quarter ended June 30, 2022, as our redemption program is suspended and we believe many stockholders who may otherwise desire to have their shares redeemed have not submitted a request due to the suspension of the program.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

Not applicable.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

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ITEM 5. OTHER INFORMATION

Renewal of Advisory Agreement

Sale of Held for Sale Property

On August 10, 2022, the due diligence period expired under the Purchase and Sale Agreement and escrow instructions with an unrelated third-party, GD Realty Group Inc., for the sale of the Wilshire Joint Venture Property located in Santa Monica, California which is under contract for a sale purchase price of $16.5 million. The closing date is expected to be October 10, 2022. There can be no assurance that we will complete the sale. In certain circumstances, if the purchaser fails to complete the acquisition, it may forfeit up to approximately $0.5 million of earnest money.

ITEM 6. EXHIBITS

The exhibits listed on the Exhibit Index (following the signatures section of this Quarterly Report on Form 10-Q) are included herewith, or incorporated herein by reference.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized on August 15, 2022.


			Strategic Realty Trust, Inc.

			By:			/s/ Matthew Schreiber
						Matthew Schreiber
						Chief Executive Officer and Director (Principal Executive Officer)

			By:			/s/ Ryan Hess
						Ryan Hess
						Chief Financial Officer (Principal Financial and Accounting Officer)

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EXHIBIT INDEX

The following exhibits are included, or incorporated by reference, in this Quarterly Report on Form 10-Q for the six months ended June 30, 2022 (and are numbered in accordance with Item 601 of Regulation S-K).

Incorporated by Reference

Exhibit No.

Description

Filed
Herewith

Form/File No.

Filing Date

3.1.1

Articles of Amendment and Restatement of TNP Strategic Retail Trust, Inc.

S-11/
No. 333-154975

7/10/2009

3.1.2

Articles of Amendment, dated August 22, 2013

8-K

8/26/2013

3.1.3

Articles Supplementary, dated November 1, 2013

8-K

11/4/2013

3.1.4

Articles Supplementary, dated January 22, 2014

8-K

1/28/2014

3.2

Third Amended and Restated Bylaws of Strategic Realty Trust, Inc.

8-K

1/28/2014

31.1

Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2

Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1

Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2

Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

99.1

Strategic Realty Trust, Inc. Amended and Restated Share Redemption Program Adopted August 26, 2016

8-K

8/30/2016

101.INS

Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

101.SCH

Inline XBRL Taxonomy Extension Schema Document

101.CAL

Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF

Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB

Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE

Inline XBRL Taxonomy Extension Presentation Linkbase Document

104.1

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)