What changed in this filing

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Item 1. Financial Statements

2022-05-10 compared with 2021-11-09 · 377 added, 445 removed, 702 unchanged (54% of the section changed)

Financial Statements

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

Consolidated Balance Sheets

(In thousands, except share and per share amounts) (Unaudited)

September 30, 2021 December 31, 2020

March 31, 2022 December 31, 2021

Investments in real estate, net $ 497,444 $ 497,984

Investment in unconsolidated entity - at fair value 22,528 —

Cash and cash equivalents 17,055 22,311

4 unchanged sentences

Other intangible assets, net 5,010 5,251

Loan servicing asset, net and other assets 11,360 8,787

Other assets 14,546 10,946

TOTAL ASSETS $ 688,265 $ 660,866

10 unchanged sentences

36,000,000 shares authorized;

1,550,884 and 1,548,884 shares issued and outstanding, respectively, as of September 30, 2021 and 2,008,256 and 2,007,856 shares issued and outstanding, respectively, as of December 31, 2020;

1,693,649 and 1,693,649 shares issued and outstanding, respectively, as of March 31, 2022 and 1,633,965 and 1,631,965 shares issued and outstanding, respectively, as of December 31, 2021;

liquidation preference of $ 25.00 per share, subject to adjustment

2 unchanged sentences

36,000,000 shares authorized;

6,003,054 and 5,821,113 shares issued and outstanding, respectively, as of September 30, 2021 and 4,484,376 and 4,377,762 shares issued and outstanding, respectively, as of December 31, 2020;

6,824,553 and 6,551,917 shares issued and outstanding, respectively, as of March 31, 2022 and 6,492,632 and 6,271,337 shares issued and outstanding, respectively, as of December 31, 2021;

liquidation preference of $ 25.00 per share, subject to adjustment

2 unchanged sentences

32,000,000 shares authorized;

56,857 shares issued and outstanding as of September 30, 2021 and 19,145 shares issued and outstanding as of December 31, 2020;

56,857 shares issued and outstanding as of March 31, 2022 and 56,857 shares issued and outstanding as of December 31, 2021;

liquidation preference of $ 25.00 per share, subject to adjustment

1 unchanged sentence

9,000,000 shares authorized;

8,080,740 and 5,387,160 shares issued and outstanding, respectively, as of September 30, 2021 and December 31, 2020;

8,080,740 and 5,387,160 shares issued and outstanding, respectively, as of March 31, 2022 and December 31, 2021;

liquidation preference of $ 28.37 per share, subject to adjustment

2 unchanged sentences

900,000,000 shares authorized;

23,369,331 shares issued and outstanding as of September 30, 2021 and 14,827,410 shares issued and outstanding as of December 31, 2020.

23,369,331 shares issued and outstanding as of March 31, 2022 and 23,369,331 shares issued and outstanding as of December 31, 2021.

Additional paid-in capital 866,272 866,746

5 unchanged sentences

The accompanying notes are an integral part of these consolidated financial statements.

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

Consolidated Statements of Operations

(In thousands, except per share amounts) (Unaudited)

Three Months Ended September 30, Nine Months Ended September 30,

2021 2020 2021 2020

Three Months Ended March 31,

Rental and other property income $ 14,096 $ 13,349

9 unchanged sentences

Depreciation and amortization 5,004 5,037

Loss on early extinguishment of debt (Note 6) — 281 — 281

21,679 22,682 65,005 70,737

INCOME (LOSS) BEFORE PROVISION (BENEFIT) FOR INCOME TAXES 2,570 ( 5,348 ) 796 ( 11,358 )

Provision (benefit) for income taxes 946 ( 18 ) 2,316 ( 731 )

Total Expenses 22,293 22,176

Income from unconsolidated entity 120 —

INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES 2,609 ( 3,297 )

Provision for income taxes 307 374

NET INCOME (LOSS) 2,302 ( 3,671 )

12 unchanged sentences

The accompanying notes are an integral part of these consolidated financial statements.

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

Consolidated Statements of Equity

(In thousands, except share and per share amounts) (Unaudited)

Nine Months Ended September 30, 2021

Three Months Ended March 31, 2022

Common Stock Preferred Stock

5 unchanged sentences

Balances, December 31, 2021 23,369,331 $ 24 11,715,354 $ 310,661 $ 866,746 $ ( 804,227 ) $ 373,204 $ 345 $ 373,549

Distributions to noncontrolling interests — — — — — — — ( 114 ) ( 114 )

Stock based compensation expense — — — — 55 — 55 — 55

3 unchanged sentences

— — — — — ( 2,896 ) ( 2,896 ) — ( 2,896 )

Issuance of Series D Preferred Stock — — 4,045 99 ( 3 ) — 96 — 96

Dividends to holders of Series D Preferred Stock ($ 0.35313 per share)

— — — — — ( 21 ) ( 21 ) — ( 21 )

Reclassification of Series A Preferred Stock to permanent equity — — 366,991 9,144 ( 901 ) — 8,243 — 8,243

Redeemable Preferred Stock deemed dividends — — — — — ( 57 ) ( 57 ) — ( 57 )

Redemption of Series A Preferred Stock — — ( 29,462 ) ( 733 ) 61 ( 13 ) ( 685 ) — ( 685 )

Net loss — — — — — ( 3,670 ) ( 3,670 ) ( 1 ) ( 3,671 )

Balances, March 31, 2021 14,827,410 $ 15 10,125,641 $ 270,546 $ 793,344 $ ( 785,730 ) $ 278,175 $ 340 $ 278,515

Stock-based compensation expense 20,332 — — — 50 — 50 — 50

Common dividends ($ 0.075 per share)

— — — — — ( 1,114 ) ( 1,114 ) — ( 1,114 )

Dividends to holders of Series A Preferred Stock ($ 0.34375 per share)

— — — — — ( 2,511 ) ( 2,511 ) — ( 2,511 )

Issuance of Series D Preferred Stock — — 7,835 192 ( 7 ) — 185 — 185

Dividends to holders of Series D Preferred Stock ($ 0.35313 per share)

— — — — — ( 13 ) ( 13 ) — ( 13 )

Reclassification of Series A Preferred Stock to permanent equity — — 556,587 13,915 ( 1,434 ) — 12,481 — 12,481

Redeemable Preferred Stock deemed dividends — — — — — ( 106 ) ( 106 ) — ( 106 )

Redemption of Series A Preferred Stock — — ( 18,501 ) ( 460 ) 42 ( 13 ) ( 431 ) — ( 431 )

Issuance of Common Stock 8,521,589 9 — — 76,934 — 76,943 — 76,943

Net (loss) income — — — — — 530 530 ( 3 ) 527

Balances, June 30, 2021 23,369,331 $ 24 10,671,562 $ 284,193 $ 868,929 $ ( 788,957 ) $ 364,189 $ 337 $ 364,526

Contributions to noncontrolling interests — — — — — — — 9 9

Distributions to noncontrolling interests — — — — — — — ( 4 ) ( 4 )

Stock-based compensation expense — — — — 55 — 55 — 55

Common dividends ($ 0.075 per share)

— — — — — ( 1,753 ) ( 1,753 ) — ( 1,753 )

Dividends to holders of Series A Preferred Stock ($ 0.34375 per share)

— — — — — ( 2,597 ) ( 2,597 ) — ( 2,597 )

Issuance of Series D Preferred Stock — — 25,832 632 ( 20 ) — 612 — 612

Dividends to holders of Series D Preferred Stock ($ 0.35313 per share)

— — — — — ( 20 ) ( 20 ) — ( 20 )

Reclassification of Series A Preferred Stock to permanent equity — — 593,300 15,132 ( 1,304 ) — 13,828 — 13,828

Redeemable Preferred Stock deemed dividends — — — — — ( 90 ) ( 90 ) — ( 90 )

Reclassification of Series A Preferred stock to Perm Equity — — 329,921 8,304 ( 637 ) — 7,667 — 7,667

Redeemable preferred stock accretion — — — — — ( 15 ) ( 15 ) — ( 15 )

Redemption of Series A Preferred Stock — — ( 49,341 ) ( 1,228 ) 108 ( 75 ) ( 1,195 ) — ( 1,195 )

Rights Offering costs — — — — ( 78 ) — ( 78 ) — ( 78 )

Net income — — — — — 2,297 2,297 5 2,302

Balances, September 30, 2021 23,369,331 $ 24 11,265,130 $ 299,323 $ 867,636 $ ( 791,820 ) $ 375,163 $ 342 $ 375,505

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

Consolidated Statements of Equity (Continued)

(In thousands, except share and per share amounts) (Unaudited)

Nine Months Ended September 30, 2020

Balances, March 31, 2022 23,369,331 $ 24 11,995,934 $ 317,737 $ 866,272 $ ( 806,923 ) $ 377,110 $ 350 $ 377,460

Three Months Ended March 31, 2021

Common Stock Preferred Stock

5 unchanged sentences

Balances, December 31, 2020 14,827,410 $ 15 9,784,067 $ 262,036 $ 794,127 $ ( 778,519 ) $ 277,659 $ 455 $ 278,114

Stock-based compensation expense — — — — 56 — 56 — 56

Common dividends ($ 0.075 per share)

— — — — — ( 1,095 ) ( 1,095 ) — ( 1,095 )

Issuance of Series A Preferred Warrants — — — — 28 — 28 — 28

Dividends to holders of Series A Preferred Stock ($ 0.68750 per share)

— — — — — ( 3,252 ) ( 3,252 ) — ( 3,252 )

Issuance of Series D Preferred Stock — — 5,980 150 ( 5 ) — 145 — 145

Dividends to holders of Series D Preferred Stock ($ 0.588542 per share)

— — — — — ( 3 ) ( 3 ) — ( 3 )

Reclassification of Series A Preferred Stock to permanent equity — — 304,274 7,588 ( 640 ) — 6,948 — 6,948

Redeemable Preferred Stock deemed dividends — — — — — ( 161 ) ( 161 ) — ( 161 )

Redemption of Series A Preferred Stock — — ( 2,452 ) ( 61 ) 5 ( 10 ) ( 66 ) — ( 66 )

Net (loss) income — — — — — ( 1,260 ) ( 1,260 ) 4 ( 1,256 )

Balances, March 31, 2020 14,602,149 $ 15 8,532,056 231,144 $ 794,269 $ ( 746,398 ) $ 279,030 $ 509 $ 279,539

Distributions to noncontrolling interests — — — — — — — ( 114 ) ( 114 )

Stock-based compensation expense — — — — 60 — 60 — 60

Issuance of shares of Common Stock in exchange for asset management fees 203,349 — — — 2,359 — 2,359 — 2,359

Common dividends ($ 0.075 per share)

— — — — — ( 1,112 ) ( 1,112 ) — ( 1,112 )

Issuance of Series D Preferred Stock — — 920 23 ( 1 ) — 22 — 22

Dividends to holders of Series D Preferred Stock ($ 0.35313 per share)

— — — — — ( 3 ) ( 3 ) — ( 3 )

Dividends to holders of Series A Preferred Stock ($ 0.34375 per share)

— — — — — ( 2,350 ) ( 2,350 ) — ( 2,350 )

Reclassification of Series A Preferred Stock to permanent equity — — 427,064 10,638 ( 899 ) — 9,739 — 9,739

Redeemable Preferred Stock deemed dividends — — — — — ( 52 ) ( 52 ) — ( 52 )

Redemption of Series A Preferred Stock — — ( 5,532 ) ( 138 ) 11 ( 56 ) ( 183 ) — ( 183 )

Net (loss) income — — — — — ( 4,043 ) ( 4,043 ) 2 ( 4,041 )

Balances, June 30, 2020 14,827,410 $ 15 8,954,508 241,667 $ 795,795 $ ( 753,550 ) $ 283,927 $ 466 $ 284,393

Stock-based compensation expense — — — — 55 — 55 — 55

Common dividends ($ 0.075 per share)

— — — — — ( 1,112 ) ( 1,112 ) — ( 1,112 )

Dividends to holders of Series A Preferred Stock ($ 0.34375 per share)

— — — — — ( 2,162 ) ( 2,162 ) — ( 2,162 )

Issuance of Series D Preferred Stock — — 4,045 99 ( 3 ) — 96 — 96

2 unchanged sentences

Reclassification of Series A Preferred Stock to permanent equity — — 366,991 9,144 ( 901 ) — 8,243 — 8,243

Redeemable Preferred Stock deemed dividends — — — — — ( 87 ) ( 87 ) — ( 87 )

Redeemable preferred stock accretion — — — — — ( 57 ) ( 57 ) — ( 57 )

Redemption of Series A Preferred Stock — — ( 29,462 ) ( 733 ) 61 ( 13 ) ( 685 ) — ( 685 )

Net loss — — — — — ( 3,670 ) ( 3,670 ) ( 1 ) ( 3,671 )

Balances, September 30, 2020 14,827,410 $ 15 9,446,326 253,683 $ 794,807 $ ( 762,245 ) $ 286,260 $ 459 $ 286,719

Balances, March 31, 2021 14,827,410 $ 15 10,125,641 $ 270,546 $ 793,344 $ ( 785,730 ) $ 278,175 $ 340 $ 278,515

The accompanying notes are an integral part of these consolidated financial statements.

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows

(In thousands) (Unaudited)

Nine Months Ended

September 30,

Three Months Ended

CASH FLOWS FROM OPERATING ACTIVITIES:

Net loss $ ( 1,520 ) $ ( 10,627 )

Adjustments to reconcile net loss to net cash provided by operating activities:

Net income (loss) $ 2,302 $ ( 3,671 )

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Depreciation and amortization, net 5,037 5,017

Loss on early extinguishment of debt — 281

Amortization of deferred loan costs 791 859

Amortization of deferred debt origination costs 297 324

Amortization of premiums and discounts on debt ( 3 ) 2

Unrealized premium adjustment 573 467

Amortization and accretion on loans receivable, net ( 426 ) ( 290 )

Amortization of deferred costs and accretion of fees on loans receivable, net ( 150 ) ( 129 )

(Recoveries) write-offs of uncollectible receivables 109 811

1 unchanged sentence

Stock-based compensation 55 60

Income from unconsolidated entity ( 120 ) —

Loans funded, held for sale to secondary market ( 12,369 ) ( 13,773 )

13 unchanged sentences

Acquisition of real estate ( 2,274 ) —

Investment in unconsolidated entity ( 22,408 ) —

Loans funded ( 10,407 ) ( 11,820 )

Principal collected on loans 4,393 8,638

Other investing activity — 81

Net cash used in investing activities ( 33,079 ) ( 3,556 )

6 unchanged sentences

Payment of common dividends ( 1,753 ) ( 1,112 )

Proceeds from issuance of Common Stock 78,825 —

Payment of Common Stock offering costs ( 540 ) —

Net proceeds from issuance of Series A Preferred Warrants — 29

Net proceeds from issuance of Preferred Stock 8,942 5,465

2 unchanged sentences

Noncontrolling interests’ distributions — ( 114 )

Net cash (used in) provided by financing activities ( 25,675 ) 30,766

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

Net cash provided by (used in) financing activities 21,412 ( 231 )

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows (Continued)

(In thousands) (Unaudited)

Nine Months Ended

September 30,

Three Months Ended

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH ( 3,028 ) 847

16 unchanged sentences

Accrued deferred costs $ — $ 54

Reclassification of loans receivable, net to real estate owned $ — $ 174

Redeemable preferred stock deemed dividends $ 15 $ 57

1 unchanged sentence

Equity-based payment for management fees $ — $ 2,419

Accrued Common Stock offering costs included in additional paid-in capital $ 1,420 $ —

The accompanying notes are an integral part of these consolidated financial statements.

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited)

March 31, 2022 (Unaudited)

ORGANIZATION AND OPERATIONS

CIM Commercial Trust Corporation (“CIM Commercial” or the “Company”), a Maryland corporation and real estate investment trust (“REIT”), together with its wholly-owned subsidiaries, primarily owns and operates Class A and creative office real assets in vibrant and improving metropolitan communities throughout the United States.

The Company, supported by the broad real estate capabilities of CIM Group, L.P.

(“CIM Group”), seeks to focus on the acquisition, ownership, operation and development of cash flowing creative office, multifamily, retail, parking, infill industrial and limited service hospitality real assets in communities qualified by CIM Group.

These communities are located in areas that include traditional downtown areas and suburban main streets, which have high barriers to entry, high population density, positive population trends and a propensity for growth.

The Company was originally organized in 1993 as PMC Commercial Trust (“PMC Commercial”), a Texas real estate investment trust.

On July 8, 2013, PMC Commercial entered into a merger agreement with CIM Urban REIT, LLC (“CIM REIT”), an affiliate of CIM Group, and subsidiaries of the respective parties.

CIM REIT was a private commercial REIT and was the owner of CIM Urban Partners, L.P.

(“CIM Urban”).

The merger was completed on March 11, 2014 (the “Acquisition Date”).

Creative Media & Community Trust Corporation (formerly known as CIM Commercial Trust Corporation) (the “Company”), is a Maryland corporation and real estate investment trust (“REIT”).

The Company primarily owns and operates Class A and creative office real assets in vibrant and improving metropolitan communities throughout the United States.

The Company also owns one hotel in northern California and a lending platform that originates loans under the Small Business Administration (“SBA”) 7(a) loan program.

The Company seeks to acquire, operate and develop premier multifamily and creative office assets that cater to rapidly growing industries such as technology, media and entertainment in vibrant and emerging communities throughout the United States.

The Company seeks to apply the expertise of CIM Group, L.P.

(“CIM Group”) to the acquisition, development and operation of top-tier multifamily properties situated in dynamic markets with similar business and employment characteristics to its creative office investments.

The Company’s common stock, $ 0.001 par value per share (“Common Stock”), is currently traded on the Nasdaq Global Market (“Nasdaq”) under the ticker symbol “CMCT”, and on the Tel Aviv Stock Exchange (the “TASE”) under the ticker symbol “CMCT-L.” The Company’s Series L preferred stock, $ 0.001 par value per share (“Series L Preferred Stock”), is currently traded on Nasdaq and on the TASE, in each case under the ticker symbol “CMCTP.” The Company has authorized for issuance 900,000,000 shares of common stock and 100,000,000 shares of preferred stock (“Preferred Stock”).

7 unchanged sentences

The selling price of the Series A Preferred Stock in the offering has been, and is expected to continue to be, $ 25.00 per share and the selling price of the Series D Preferred Stock was $ 25.00 per share for all sales that occurred from the beginning of the offering to and including June 28, 2020 and is expected to be, and since June 29, 2020, has been, $ 24.50 per share through the end of the life of the offering.

During the nine months ended September 30, 2021, the Company conducted a rights offering (the “Rights Offering”) pursuant to which the Company issued an aggregate of 8,521,589 shares of Common Stock at a subscription price of $ 9.25 per share for aggregate gross proceeds of $ 78.8 million before issuance costs of $ 2.0 million .

CIM Commercial has qualified and intends to continue to qualify as a REIT, as defined in the Internal Revenue Code of 1986, as amended.

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

For more information regarding the Company’s significant accounting policies and estimates, please refer to “Basis of Presentation and Summary of Significant Accounting Policies” contained in Note 2 to the Company’s consolidated financial statements for the year ended December 31, 2020, included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on March 16, 2021 and amended on April 30, 2021 (the “2020 Form 10-K”).

Interim Financial Information —The accompanying interim consolidated financial statements of CIM Commercial have been prepared by the Company’s management in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

For more information regarding the Company’s significant accounting policies and estimates, please refer to “Basis of Presentation and Summary of Significant Accounting Policies” contained in Note 2 to the Company’s consolidated financial statements for the year ended December 31, 2021, included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on March 16, 2022.

Interim Financial Information —The accompanying interim consolidated financial statements of the Company have been prepared by the Company’s management in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

Certain information and note disclosures required for annual financial statements have been condensed or excluded pursuant to SEC rules and regulations.

1 unchanged sentence

The accompanying financial information reflects all adjustments which are, in the opinion of the Company’s management, of a normal recurring nature and necessary for a fair presentation of the Company’s financial position, results of operations and cash flows for the interim periods.

Operating results for the three and nine months ended September 30, 2021 are not necessarily indicative of the results that may be expected for the year ending December 31, 2021 given, among other things, the uncertain impact of the novel coronavirus (“COVID-19”) on the Company’s operations during the remainder of the year.

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 (Unaudited) – (Continued)

results for the three months ended March 31, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022 given, among other things, the uncertain impact of the novel coronavirus (“COVID-19”) on the Company’s operations during the remainder of the year.

The accompanying interim consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto, included in the 2021 Form 10-K.

Principles of Consolidation —The consolidated financial statements include the accounts of CIM Commercial and its subsidiaries.

Principles of Consolidation —The consolidated financial statements include the accounts of the Company and its subsidiaries.

All intercompany transactions and balances have been eliminated in consolidation.

2 unchanged sentences

The Company’s ability to correctly assess its influence or control over an entity affects the presentation of these investments in real estate on the Company’s consolidated financial statements.

As of September 30, 2021, the Company has determined that the trust formed for the benefit of the note holders (the “Trust”) for the securitization of the unguaranteed portion of certain of the Company’s SBA 7(a) loans receivable is considered a VIE.

As of March 31, 2022, the Company has determined that the trust formed for the benefit of the note holders (the “Trust”) for the securitization of the unguaranteed portion of certain of the Company’s SBA 7(a) loans receivable is considered a VIE.

Applying the consolidation requirements for VIEs, the Company determined that it is the primary beneficiary based on its power to direct activities through its role as servicer and its obligations to absorb losses and right to receive benefits.

11 unchanged sentences

Ordinary repairs and maintenance are expensed as incurred.

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

Recoverability of Investments in Real Estate —The Company continually monitors events and changes in circumstances that could indicate that the carrying amounts of its real estate assets may not be recoverable.

3 unchanged sentences

The process for evaluating real estate impairment requires management to make significant assumptions related to certain inputs, including rental rates, lease-up period, occupancy, estimated holding periods, capital expenditures, growth rates, market discount rates and terminal capitalization rates.

For the Company’s hotel property, additional inputs considered include revenue per available room and average daily rate.

These inputs require a subjective evaluation based on the specific property and market.

1 unchanged sentence

Any asset held for sale is reported at the lower of the asset’s carrying amount or fair value, less costs to sell.

When an asset is identified by the Company as held for sale, the Company will cease recording depreciation and amortization of the asset.

For the three and nine months ended September 30, 2021 and 2020, the Company recognized no impairment of long-lived assets ( Note 3 ).

When an asset is identified by the Company as held for sale, the Company will

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 (Unaudited) – (Continued)

cease recording depreciation and amortization of the asset.

The Company did no t recognize any impairment of long-lived assets during the three months ended March 31, 2022 and 2021 (Note 3).

Investment in Unconsolidated Entity —In February 2022, the Company invested in an unconsolidated joint venture arrangement (the “Unconsolidated Joint Venture”) with a CIM-managed separate account (the “CM JV Partner”) to purchase an office property in Los Angeles, California for approximately $ 51.0 million, gross of proration amounts, of which the Company initially contributed approximately $ 22.4 million and the CIM JV Partner initially contributed the remaining balance.

The Company accounts for its approximately 44 % investment in the Unconsolidated Joint Venture under the equity method, as it has the ability to exercise significant influence over the investment.

The Company has elected the fair value option (“FVO”) for its equity method investment and therefore reports this investment at fair value.

As such, the Company records its share of the Unconsolidated Joint Venture’s profits or losses on a quarterly basis as an adjustment to the carrying value of the investment on the Company’s consolidated balance sheet and such share is recognized as a profit or loss on the consolidated statements of operations.

The Company recorded income of $ 120,000 related to its investment in the Unconsolidated Joint Venture during the three months ended March 31, 2022 in the consolidated statements of operations.

Revenue Recognition —At the inception of a revenue-producing contract, the Company determines if a contract qualifies as a lease and if not, then as a customer contract.

15 unchanged sentences

Lease incentives paid to tenants are included in other assets and amortized as a reduction to rental revenue on a straight-line basis over the term of the related lease.

As of September 30, 2021 and December 31, 2020, lease incentives of $ 4.0 million and $ 4.0 million, respectively, are presented net of accumulated amortization of $ 2.6 million and $ 2.4 million, respectively.

As of March 31, 2022 and December 31, 2021, lease incentives of $ 4.0 million and $ 4.0 million, respectively, are presented net of accumulated amortization of $ 2.8 million and $ 2.7 million, respectively.

Reimbursements from tenants, consisting of amounts due from tenants for common area maintenance, real estate taxes, insurance, and other recoverable costs, are recognized as revenue and are included in rental and other property income in the period the expenses are incurred, with the corresponding expenses included in rental and other property operating expense.

1 unchanged sentence

The Company has elected not to separate lease and non-lease components as the pattern of revenue recognition does not differ for the two components, and the non-lease component is not the primary component in the Company’s leases.

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

In addition to minimum rents, certain leases, including the Company’s parking leases with third-party operators, provide for additional rents based upon varying percentages of tenants’ sales in excess of annual minimums.

Percentage rent is recognized once lessees’ specified sales targets have been met.

For the three and nine months ended September 30, 2021 and 2020, the Company recognized rental income as follows (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2021 2020 2021 2020

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 (Unaudited) – (Continued)

For the three months ended March 31, 2022 and 2021, the Company recognized rental income as follows (in thousands):

Three Months Ended March 31,

Rental and other property income

2 unchanged sentences

Variable lease payments (2)

3,091 515 5,239 3,122

Rental and other property income $ 14,096 $ 13,349

1 unchanged sentence

(1) Fixed lease payments include contractual rents under lease agreements with tenants recognized on a straight-line basis over the lease term, including amortization of acquired above-market leases, below-market leases and lease incentives.

(2) Variable lease payments include expense reimbursements billed to tenants and percentage rent, net of bad debt expense from the Company’s operating leases.

(2) Variable lease payments include expense reimbursements billed to tenants and percentage rent, net of bad debt expense from the Company’s operating leases plus cash payments from tenants deemed not probable of collection.

Collectability of Lease-Related Receivables

5 unchanged sentences

The Company does not use a general reserve approach.

As of September 30, 2021 and December 31, 2020, the Company had identified certain tenants where collection was no longer considered probable and decreased outstanding receivables by $ 1.7 million and $ 1.9 million, respectively, across all operating leases.

As of March 31, 2022 and December 31, 2021, the Company had identified certain tenants where collection was no longer considered probable and decreased outstanding receivables by $ 416,000 and $ 579,000 , respectively, across all operating leases.

Revenue from lending activities

Interest income included in interest and other income is comprised of interest earned on loans and the Company’s short-term investments and the accretion of net loan origination fees and discounts.

Interest income included in interest and other income is comprised of interest earned on loans and the Company’s short-term investments and the accretion of loan discounts.

Interest income on loans is accrued as earned with the accrual of interest suspended when the related loan becomes a Non-Accrual Loan (as defined below).

9 unchanged sentences

The Company satisfies its performance obligation and recognizes revenues associated with noncancelable reservations at the earlier of (i) the date on which the customer cancels the reservation or (ii) over time as services are rendered to the customer.

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

Ancillary services include facilities usage and providing food and beverage.

The Company satisfies its performance obligation and recognizes revenues associated with these services at a point in time when the good or service is delivered to the customer.

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 (Unaudited) – (Continued)

At inception of a contract with a customer for hotel goods and services, the contractual price is equivalent to the transaction price as there are no elements of variable consideration to estimate.

1 unchanged sentence

Below is a reconciliation of the hotel revenue from contracts with customers to the total hotel segment revenue disclosed in Note 16 (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2021 2020 2021 2020

Three Months Ended March 31,

Hotel properties

9 unchanged sentences

The Company satisfies its performance obligation and recognizes revenues associated with these services over time as the construction is completed.

No such amounts were recognized for tenant recoveries outside of the lease agreements for each of the three and nine months ended September 30, 2021 and 2020.

As of September 30, 2021, there were no remaining performance obligations associated with tenant recoveries outside of the lease agreements.

Loans Receivable —The Company’s loans receivable are carried at their unamortized principal balance less unamortized acquisition discounts and premiums, deferred origination fees, retained loan discounts and loan loss reserves.

No such amounts were recognized for tenant recoveries outside of the lease agreements for each of the three months ended March 31, 2022 and 2021.

As of March 31, 2022, there were no remaining performance obligations associated with tenant recoveries outside of the lease agreements.

Loans Receivable —The Company’s loans receivable are carried at their unamortized principal balance less unamortized acquisition discounts and premiums, retained loan discounts and loan loss reserves.

Acquisition discounts or premiums, origination fees and retained loan discounts are amortized as a component of interest and other income using the effective interest method over the life of the respective loans, or on a straight-line basis when it approximates the effective interest method.

All loans were originated pursuant to programs sponsored by the Small Business Administration (the “SBA”).

The programs consist of loans originated under the SBA 7(a) Small Business Loan Program and, commencing with the quarter ended June 30, 2020, the Paycheck Protection Program (the “PPP”).

Pursuant to the SBA 7(a) Small Business Loan Program, the Company sells the portion of the loan that is guaranteed by the SBA.

The programs consist of loans originated under the SBA 7(a) Small Business Loan Program (the “SBA 7(a) Program”) and, commencing with the quarter ended June 30, 2020, the Paycheck Protection Program (the “PPP”).

Pursuant to the SBA 7(a) Program, the Company sells the portion of the loan that is guaranteed by the SBA.

Upon sale of the SBA guaranteed portion of the loans, which are accounted for as sales, the unguaranteed portion of the loan retained by the Company is recorded at fair value and a discount is recorded as a reduction in basis of the retained portion of the loan.

Unamortized retained loan discounts were $ 9.4 million and $ 7.8 million as of September 30, 2021 and December 31, 2020, respectively.

At the Acquisition Date, the carrying value of the Company’s loans was adjusted to estimated fair market value and acquisition discounts of $ 33.9 million were recorded, which are being accreted to interest and other income using the effective interest method.

Acquisition discounts of $ 420,000 and $ 492,000 remained as of September 30, 2021 and December 31, 2020, respectively.

Unamortized retained loan discounts were $ 9.8 million and $ 9.6 million as of March 31, 2022 and December 31, 2021, respectively.

At the closing of the merger in 2014 between CIM Urban REIT, LLC (“CIM REIT”), an affiliate of CIM Group, and certain of its subsidiaries and PMC Commercial Trust, the predecessor to the Company, the carrying value of the Company’s loans was adjusted to estimated fair market value and acquisition discounts of $ 33.9 million were recorded, which are being accreted to interest and other income using the effective interest method.

Acquisition discounts of $ 330,000 and $ 381,000 remained as of March 31, 2022 and December 31, 2021, respectively.

A loan receivable is generally classified as non-accrual (a “Non-Accrual Loan”) if (i) it is past due as to payment of principal or interest for a period of 60 days or more, (ii) any portion of the loan is classified as doubtful or is charged-off or (iii) the repayment in full of the principal and or interest is in doubt.

Generally, loans are charged-off when management determines that the Company will be unable to collect any remaining amounts due under the loan agreement, either through

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

liquidation of collateral or other means.

Generally, loans are charged-off when management determines that the Company will be unable to collect any remaining amounts due under the loan agreement, either through liquidation of collateral or other means.

Interest income, included in interest and other income, on a Non-Accrual Loan is recognized on the cost recovery basis.

Loan Loss Reserves —On a quarterly basis, and more frequently if indicators exist, the Company evaluates the collectability of its loans receivable.

The Company’s evaluation of collectability involves significant judgment, estimates, and a review of the ability of the borrower to make principal and interest payments, the underlying collateral and the borrowers’ business models and future operations.

For the three and nine months ended September 30, 2021, the Company recorded a net impairment of $ 7,000 and $ 11,000 , respectively, on its loans receivable.

For the three and nine months ended September 30, 2020, the Company recorded a net impairment of $ 1,000 and a net recovery of $ 15,000 , respectively, on its loans receivable.

There were no material loans receivable subject to credit risk which were considered to be impaired as of September 30, 2021 or December 31, 2020.

The Company’s evaluation of collectability involves significant judgment, estimates, and a

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 (Unaudited) – (Continued)

review of the ability of the borrower to make principal and interest payments, the underlying collateral and the borrowers’ business models and future operations.

For the three months ended March 31, 2022 and 2021, the Company recorded a net impairment losses of $ 0 and 92,000 , respectively, on its loans receivable.

There were no material loans receivable subject to credit risk which were considered to be impaired as of March 31, 2022 or December 31, 2021.

The Company considers a loan to be impaired when the Company does not expect to collect all of the contractual interest and principal payments as scheduled in the loan agreements.

4 unchanged sentences

These loss percentages are based on many factors, primarily cumulative and recent loss history and general economic conditions.

As of September 30, 2021 and December 31, 2020, the Company had loan loss reserves of $ 959,000 and $ 885,000 , respectively.

As of March 31, 2022 and December 31, 2021, the Company had loan loss reserves of $ 980,000 and $ 943,000 , respectively.

Deferred Rent Receivable and Charges —Deferred rent receivable and charges consist of deferred rent, deferred leasing costs, deferred offering costs (Note 10) and other deferred costs.

5 unchanged sentences

The deferred offering costs allocated to the Series A Preferred Stock and Series A Preferred Warrants are reductions to temporary equity and permanent equity, respectively.

As of September 30, 2021 and December 31, 2020, deferred rent receivable and charges consist of the following (in thousands):

September 30, 2021 December 31, 2020

As of March 31, 2022 and December 31, 2021, deferred rent receivable and charges consist of the following (in thousands):

March 31, 2022 December 31, 2021

Deferred rent receivable $ 20,702 $ 20,870

7 unchanged sentences

As a result, the Company records issuances of Series A Preferred Stock in temporary equity.

On the first anniversary of the date of original issuance of a particular share of Series A Preferred Stock, the

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

Company reclassifies such share of Series A Preferred Stock from temporary equity to permanent equity because the feature giving rise to temporary equity classification, the requirement to satisfy redemption requests in cash, lapses on the first anniversary date.

On the first anniversary of the date of original issuance of a particular share of Series A Preferred Stock, the Company reclassifies such share of Series A Preferred Stock from temporary equity to permanent equity because the feature giving rise to temporary equity classification, the requirement to satisfy redemption requests in cash, lapses on the first anniversary date.

Noncontrolling Interests —Noncontrolling interests represent the interests in various properties owned by third-parties.

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 (Unaudited) – (Continued)

Restricted Cash —The Company’s mortgage loan and hotel management agreements provide for depositing cash into restricted accounts reserved for capital expenditures, free rent, tenant improvement and leasing commission obligations.

Restricted cash also includes cash required to be segregated in connection with certain of the Company’s loans receivable.

Reclassifications —Certain prior period amounts have been reclassified to conform with the current period presentation.

These reclassifications had no effect on previously reported totals or subtotals.

The reclassifications have been made to the consolidated statement of cash flows for the nine months ended September 30, 2020 as follows (in thousands):

Nine Months Ended September 30, 2020

As previously reported Reclassification As Revised

Consolidated Statements of Cash Flows

Depreciation and amortization, net $ 15,728 $ ( 267 ) $ 15,461

Deferred rent and amortization of intangible assets, liabilities and lease inducements $ ( 1,013 ) $ 1,013 $ —

Other assets $ 1,159 $ ( 746 ) $ 413

Payment of revolving credit facilities, mortgages payable, term notes and principal on SBA 7(a) loan-backed notes $ — $ ( 55,159 ) $ ( 55,159 )

Payment of principal on SBA 7(a) loan-backed notes $ ( 7,159 ) $ 7,159 $ —

Payment of unsecured revolving lines of credit, revolving credit facility and or term note $ ( 48,000 ) $ 48,000 $ —

Proceeds from revolving credit facilities and term notes $ — $ 77,516 $ 77,516

Proceeds from unsecured revolving lines of credit, revolving credit facility and or term note $ 61,500 $ ( 61,500 ) $ —

Borrowed funds from the Federal Reserve through the Paycheck Protection Program Liquidity Facility $ 16,016 $ ( 16,016 ) $ —

Payment of deferred costs $ ( 205 ) $ ( 535 ) $ ( 740 )

Payment of deferred loan costs $ ( 535 ) $ 535 $ —

Net proceeds from issuance of Preferred Stock $ 32,466 $ 446 $ 32,912

Net proceeds from issuance of Series D Preferred Stock $ 446 $ ( 446 ) $ —

Additions to deferred loan costs included in accounts payable and accrued expenses $ 221 $ ( 221 ) $ —

Accrued deferred costs $ 140 $ 221 $ 361

Preferred stock offering costs offset against redeemable preferred stock $ 451 $ 4 $ 455

Preferred stock offering costs offset against redeemable preferred stock in permanent equity $ 4 $ ( 4 ) $ —

Accrued redeemable preferred stock fees $ 386 $ 6 $ 392

Redeemable Series D Preferred Stock fees included in accounts payable and accrued expenses $ 6 $ ( 6 ) $ —

Equity-based payment for management fees $ 2,359 $ 2,663 $ 5,022

Payment of management fees and base service fee in preferred stock $ 2,663 $ ( 2,663 ) $ —

Use of Estimates —The preparation of consolidated financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period.

The Company bases such estimates on historical experience, information available at the

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

time, and assumptions the Company believes to be reasonable under the circumstances and at such time, including the impact of extraordinary events such as COVID-19.

The Company bases such estimates on historical experience, information available at the time, and assumptions the Company believes to be reasonable under the circumstances and at such time, including the impact of extraordinary events such as COVID-19.

Actual results could differ from those estimates.

17 unchanged sentences

Early adoption is permitted for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2018.

The Company has not yet adopted ASU 2016-13 and the related updates and remains in the process of evaluating the impact of adoption of this new accounting guidance on its consolidated financial statements.

The Company has been evaluating the impact of adoption of ASU 2016-13 on its consolidated financial statements and expects to adopt ASU 2016-13 and the related updates beginning on January 1, 2023.

On April 10, 2020, the FASB issued a question-and-answer document (the “Q&A”) to address stakeholder questions on the application of the lease accounting guidance for lease concessions related to the effects of COVID-19.

1 unchanged sentence

However, the Q&A provides that the Company may bypass the lease by lease analysis if certain criteria are met, and instead elect to either consistently apply, or consistently not apply, the lease modification framework to groups of leases with similar characteristics and similar circumstances.

The Company has elected not to apply the lease modification guidance to concessions related to the effects of COVID-19 that do not result in a substantial increase in the Company’s rights as lessor, including concessions that result in the total payments required by the modified lease being substantially the same as or less than the total payments required by the original lease.

As described below, the Company has elected not to apply the lease modification guidance to concessions related to the effects of COVID-19 that do not result in a substantial increase in the Company’s rights as lessor, including concessions that result in the total payments required by the modified lease being substantially the same as or less than the total payments required by the original lease.

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 (Unaudited) – (Continued)

INVESTMENTS IN REAL ESTATE

Investments in real estate consist of the following (in thousands):

September 30, 2021 December 31, 2020

March 31, 2022 December 31, 2021

Land $ 143,508 $ 141,236

7 unchanged sentences

Net investments in real estate $ 497,444 $ 497,984

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

For the three months ended March 31, 2022 and 2021, the Company recorded depreciation expense of $ 4.2 million and $ 4.2 million.

2022 Transactions — During the three months ended March 31, 2022, the Company acquired a 100 % fee-simple interest in the following property from an unrelated third-party.

The purchase was accounted for as an asset acquisition.

Please see “Investments in Unconsolidated Entities” (Note 4) below for information on the Company’s acquisition of an approximate 44 % interest in an office property in February 2022.

Asset Date of Purchase

Property Type Acquisition Square Feet Price (1)

(in thousands)

3101 S Western Avenue, Los Angeles, CA (2)

Multifamily (2)

February 11, 2022 3,752 $ 2,260

(1) Transaction costs that were capitalized as a component of the assets acquired and liabilities assumed in connection with the acquisition of this property totaled $ 14,000 , which are not included in the purchase price above.

(2) The property is located on a land site of approximately 11,300 square feet.

The Company intends to entitle the property and develop approximately 45 residential units.

There were no dispositions during the three months ended March 31, 2022.

2021 Transactions — There were no acquisitions or dispositions for the three months ended March 31, 2021.

The results of operations of the property the Company acquired have been included in the consolidated statements of operations from the date of acquisition.

The purchase price of the acquisition completed during the three months ended March 31, 2022 was less than 10% of the Company’s total assets as of the respective most recent annual consolidated financial statements filed at or prior to the date of acquisition.

The following table summarizes the purchase price allocation of the aforementioned acquisition during the three months ended March 31, 2022.

(in thousands)

Land improvements 3

Net assets acquired $ 2,274

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

The Company recorded depreciation expense of $ 4.3 million and $ 4.4 million for the three months ended September 30, 2021 and 2020, respectively, and $ 12.7 million and $ 13.0 million for the nine months ended September 30, 2021 and 2020, respectively.

2021 and 2020 Transactions —During the nine months ended September 30, 2021, the Company acquired from an unrelated third-party a 100 % fee-simple interest in an office property located in Los Angeles, California for a purchase price of $ 2.9 million, which was accounted for as an asset acquisition.

The purchase price excludes transaction costs of $ 33,000 that were incurred and capitalized in connection with this acquisition.

The property has 4,455 square feet of office space.

There were no acquisitions or dispositions during the nine months ended September 30, 2020.

March 31, 2022 (Unaudited) – (Continued)

INVESTMENTS IN UNCONSOLIDATED ENTITIES

The following table details the Company’s equity method investments in unconsolidated entities.

Refer to Note 2 - Basis of Presentation and Summary of Significant Accounting Policies for more details (dollars in thousands):

Carrying Value

Property Asset Type Location Date of Acquisition Ownership Interest March 31, 2022 December 31, 2021

1910 Sunset Blvd (1)

Office Los Angeles, CA February 11, 2022 44 % $ 22,528 $ —

______________________

(1) 1910 Sunset Blvd is an office building with 97,564 square feet of office space and 2,760 square feet of retail space.

The Unconsolidated Joint Venture plans to undertake a capital improvement program to renovate and modernize the building into creative office space as well as a limited number of multifamily units.

The Company did no t receive any distributions from the Unconsolidated Joint Venture during the three months ended March 31, 2022.

LOANS RECEIVABLE

Loans receivable consist of the following (in thousands):

September 30, 2021 December 31, 2020

March 31, 2022 December 31, 2021

SBA 7(a) loans receivable, subject to credit risk $ 45,802 $ 42,103

7 unchanged sentences

Loans receivable, net $ 79,404 $ 73,543

SBA 7(a) Loans Receivable, Subject to Credit Risk —Represents the unguaranteed portions of loans originated under the SBA 7(a) Small Business Loan Program which were retained by the Company.

SBA 7(a) Loans Receivable, Subject to Loan-Backed Notes —Represents the unguaranteed portions of loans originated under the SBA 7(a) Small Business Loan Program which were transferred to a trust and are held as collateral in connection with a securitization transaction.

SBA 7(a) Loans Receivable, Subject to Credit Risk —Represents the unguaranteed portions of loans originated under the SBA 7(a) Program which were retained by the Company.

SBA 7(a) Loans Receivable, Subject to Loan-Backed Notes —Represents the unguaranteed portions of loans originated under the SBA 7(a) Program which were transferred to a trust and are held as collateral in connection with a securitization transaction.

The proceeds received from the transfer are reflected as loan-backed notes payable (Note 7).

These loans are subject to credit risk.

SBA 7(a) Loans Receivable, Paycheck Protection Program —As a SBA 7(a) licensee, the Company originated $ 26.4 million in loans under the PPP with $ 7.6 million outstanding as of September 30, 2021.

As of September 30, 2021, a significant portion of these loans have been either forgiven or repaid, and the Company expects a significant portion of the outstanding balance at September 30, 2021 will be forgiven or repaid, either in part or in full, by the SBA, including both principal and accrued interest.

SBA 7(a) Loans Receivable, Subject to Secured Borrowings —Represents the government guaranteed portions of loans originated under the SBA 7(a) Small Business Loan Program which were sold with the proceeds received from the sale reflected as secured borrowings—government guaranteed loans.

SBA 7(a) Loans Receivable, Paycheck Protection Program —As an SBA 7(a) licensee, the Company originated loans under the PPP.

As of March 31, 2022, a significant portion of these loans have been either forgiven or repaid, and the Company expects that all of the outstanding PPP loans will be forgiven, either in part or in full, by the SBA or be repaid by the borrower, including both principal and accrued interest.

SBA 7(a) Loans Receivable, Subject to Secured Borrowings —Represents the government guaranteed portions of loans originated under the SBA 7(a) Program which were sold with the proceeds received from the sale reflected as secured borrowings—government guaranteed loans.

There is no credit risk associated with these loans since the SBA has guaranteed payment of the principal.

SBA 7(a) Loans Receivable, Held for Sale — Represents the government guaranteed portion of loans held for sale at the end of the period or that had been sold but in respect of which proceeds had not been received as of the end of the period.

As of September 30, 2021 and December 31, 2020, the Company’s loans subject to credit risk were 99.8 % and 99.1 %, respectively, concentrated in the hospitality industry.

As of September 30, 2021 and December 31, 2020, 99.9 % and 98.8 %, respectively, of the Company’s loans subject to credit risk were current.

The Company classifies loans with negative characteristics in substandard categories ranging from special mention to doubtful.

As of both September 30, 2021 and December 31, 2020, $ 1.4 million of loans subject to credit risk were classified in substandard categories.

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

As of March 31, 2022 and December 31, 2021, the Company’s loans subject to credit risk were 99.9 % and 99.8 %, respectively, concentrated in the hospitality industry.

As of March 31, 2022 and December 31, 2021, 100.0 % and 100.0 %,

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

March 31, 2022 (Unaudited) – (Continued)

respectively, of the Company’s loans subject to credit risk were current.

The Company classifies loans with negative characteristics in substandard categories ranging from special mention to doubtful.

As of March 31, 2022 and December 31, 2021, $ 1.0 million and $ 1.1 million, respectively, of loans subject to credit risk were classified in substandard categories.

OTHER INTANGIBLE ASSETS AND LIABILITIES

A schedule of the Company’s intangible assets and liabilities and related accumulated amortization and accretion as of September 30, 2021 and December 31, 2020 is as follows (in thousands):

September 30, 2021 December 31, 2020

Intangible lease assets:

Acquired in-place leases, net of accumulated amortization of $ 8,786 and $ 9,228 , respectively, with an average useful life of 9 and 8 years, respectively

A schedule of the Company’s intangible assets and liabilities and related accumulated amortization and accretion as of March 31, 2022 and December 31, 2021 is as follows (in thousands):

March 31, 2022 December 31, 2021

Intangible assets:

Acquired in-place leases, net of accumulated amortization of $ 8,463 and $ 9,030 , respectively, both with an average useful life of 9 years

$ 2,028 $ 2,266

3 unchanged sentences

Intangible lease liabilities:

Acquired below-market leases, net of accumulated amortization of $ 1,063 and $ 1,786 , respectively, with an average useful life of 5 and 4 years, respectively

Acquired below-market leases, net of accumulated amortization of $ 996 and $ 1,134 , respectively, both with an average useful life of 5 years

Amortization of the acquired above-market leases is recorded as a reduction to rental and other property income, and amortization of the acquired in-place leases is included in depreciation and amortization in the accompanying consolidated statements of operations.

Amortization of the acquired below-market leases is recorded as an increase to rental and other property income in the accompanying consolidated statements of operations.

During the three and nine months ended September 30, 2021 and 2020, the Company recognized amortization related to its intangible assets and liabilities as follows (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2021 2020 2021 2020

During the three months ended March 31, 2022 and 2021, the Company recognized amortization related to its intangible assets and liabilities as follows (in thousands):

Three Months Ended March 31,

Acquired above-market lease amortization $ 3 $ 3

1 unchanged sentence

Acquired below-market lease amortization $ 69 $ 115

A schedule of future amortization and accretion of acquired intangible assets and liabilities as of September 30, 2021, is as follows (in thousands):

A schedule of future amortization and accretion of acquired intangible assets and liabilities as of March 31, 2022, is as follows (in thousands):

Assets Liabilities

2 unchanged sentences

Leases Acquired

2021 (Three months ending December 31, 2021) $ 3 $ 243 $ ( 71 )

2022 12 813 ( 236 )

2022 (Nine months ending December 31, 2022) $ 9 $ 574 $ ( 166 )

2023 9 469 ( 2 )

1 unchanged sentence

$ 25 $ 2,028 $ ( 168 )

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

The following table summarizes the debt balances as of September 30, 2021 and December 31, 2020, and the debt activity for the nine months ended September 30, 2021 (in thousands):

During the Nine Months Ended September 30, 2021

Balances as of December 31, 2020 Debt Issuances & Assumptions Repayments & Modifications Accretion & (Amortization) Balances as of September 30, 2021

March 31, 2022 (Unaudited) – (Continued)

The following table summarizes the debt balances as of March 31, 2022 and December 31, 2021, and the debt activity for the three months ended March 31, 2022 (in thousands):

During the Three Months Ended March 31, 2022

Balances as of December 31, 2021 Debt Issuances & Assumptions Repayments Accretion & (Amortization) Balances as of March 31, 2022

Mortgage Payable:

Outstanding Balance $ 97,100 $ — $ — $ — $ 97,100

Deferred loan costs — Mortgage Payable ( 147 ) — — 20 ( 127 )

Deferred debt origination costs — Mortgage Payable ( 120 ) — — 6 ( 114 )

Total Mortgage Payable 96,980 — — 6 96,986

8 unchanged sentences

Borrowed funds from the Federal Reserve through the Paycheck Protection Program Liquidity Facility 5,030 — ( 1,349 ) — 3,681

Deferred loan costs — other debt ( 2,155 ) — 125 771 ( 1,259 )

Deferred debt origination costs — other ( 989 ) — — 291 ( 698 )

Discount on junior subordinated notes ( 1,592 ) — — 24 ( 1,568 )

2 unchanged sentences

Mortgage Payable —The mortgage payable is secured by a deed of trust on a property and assignments of rents receivable.

As of September 30, 2021, the Company’s mortgage payable had a fixed interest rate of 4.14 % per annum, with monthly payments of interest only, due on July 1, 2026.

As of March 31, 2022, the Company’s mortgage payable had a fixed interest rate of 4.14 % per annum, with monthly payments of interest only, due on July 1, 2026.

The loan is nonrecourse.

1 unchanged sentence

These loans included cash premiums that are amortized as a reduction to interest expense over the life of the loan using the effective interest method and are fully amortized when the underlying loan is repaid in full.

As of September 30, 2021, the Company’s secured borrowings-government guaranteed loans included $ 5.1 million of loans sold for a premium and excess spread, with a variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 3.86 %, and $ 2.7 million of loans sold for an excess spread, with a variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 1.56 %.

2018 Revolving Credit Facility —In October 2018, CIM Commercial entered into a secured revolving credit facility with a bank syndicate that, as amended, allows CIM Commercial to borrow up to $ 209.5 million, subject to a borrowing base calculation (the “2018 revolving credit facility”).

In September 2020, the 2018 revolving credit facility was amended (the “2018 Credit Facility Modification”) to remedy the effect that COVID-19 had on CIM Commercial’s ability to borrow under the 2018 revolving credit facility during the period from September 2, 2020 through August 14, 2021 (the “Deferral Period”).

The 2018 revolving credit facility bears interest (i) during the Deferral Period at (A) the base rate plus 1.05 % or (B) LIBOR plus 2.05 %

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

As of March 31, 2022, the Company’s secured borrowings-government guaranteed loans included $ 3.7 million of loans sold for a premium and excess spread, with a variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 3.88 %, and $ 2.6 million of loans sold for an excess spread, with a variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 1.56 %.

2018 Revolving Credit Facility —In October 2018, the Company entered into a secured revolving credit facility with a bank syndicate that, as amended, allows the Company to borrow up to $ 209.5 million, subject to a borrowing base calculation (the “2018 revolving credit facility”).

In September 2020, the 2018 revolving credit facility was amended (the “2018 Credit Facility Modification”) to remedy the effect that COVID-19 had on the Company’s ability to borrow under the 2018 revolving credit facility during the period from September 2, 2020 through August 14, 2021 (the “Deferral Period”).

The 2018 revolving credit facility bore interest during the Deferral Period at (A) the base rate plus 1.05 % or (B) LIBOR plus 2.05 % and (ii) bears

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

and (ii) after the Deferral Period, at (A) the base rate plus 0.55 % or (B) LIBOR plus 1.55 %.

As of September 30, 2021 and December 31, 2020, the variable interest rate was 2.13 % and 2.20 %, respectively.

March 31, 2022 (Unaudited) – (Continued)

interest after the Deferral Period, at (A) the base rate plus 0.55 % or (B) LIBOR plus 1.55 %.

As of March 31, 2022 and December 31, 2021, the variable interest rate was 2.49 % and 2.15 %, respectively.

The 2018 revolving credit facility is also subject to an unused commitment fee of 0.15 % or 0.25 % depending on the amount of aggregate unused commitments.

1 unchanged sentence

The 2018 revolving credit facility contains customary covenants and is not subject to any financial covenants (though the amount the Company may borrow under the 2018 revolving credit facility is determined by a borrowing base calculation).

The 2018 revolving credit facility matures in October 2022 and provides for one one-year extension option under certain conditions.

As of September 30, 2021 and December 31, 2020, $ 75.0 million and $ 166.5 million, respectively, was outstanding under the 2018 revolving credit facility, and approximately $ 91.0 million and $ 28.0 million, respectively, was available for future borrowings.

2020 Unsecured Revolving Credit Facility —In May 2020, to further enhance its liquidity position and maintain financial flexibility, CIM Commercial entered into an unsecured revolving credit facility with a bank (the “2020 unsecured revolving credit facility”) pursuant to which CIM Commercial can borrow up to a maximum of $ 10.0 million.

The 2018 revolving credit facility matures in October 2022 and provides for one one-year extension option under certain conditions, including providing notice of the election and paying an extension fee of 0.15 % of each lender’s commitment being extended on the effective date of such extension.

The Company expects to extend its maturity to October 2023, subject to satisfying such conditions, and/or refinance such indebtedness.

As of March 31, 2022 and December 31, 2021, $ 90.0 million and $ 60.0 million, respectively, was outstanding under the 2018 revolving credit facility, and approximately $ 106.2 million and $ 117.6 million, respectively, was available for future borrowings.

2020 Unsecured Revolving Credit Facility —In May 2020, the Company entered into an unsecured revolving credit facility with a bank (the “2020 unsecured revolving credit facility”) pursuant to which the Company can borrow up to a maximum of $ 10.0 million.

Outstanding advances under the 2020 unsecured revolving credit facility bear interest at the rate of 1.00 %.

CIM Commercial also pays a revolving credit facility fee of 1.12 % with each advance under the 2020 unsecured revolving credit facility, which fee is subject to a cap of $ 112,000 in the aggregate.

The Company also pays a revolving credit facility fee of 1.12 % with each advance under the 2020 unsecured revolving credit facility, which fee is subject to a cap of $ 112,000 in the aggregate.

The 2020 unsecured revolving credit facility contains certain customary covenants including a maximum leverage ratio and a minimum fixed charge coverage ratio, as well as certain other conditions.

The 2020 unsecured revolving credit facility matures in May 2022.

As of September 30, 2021, no amounts were outstanding under the 2020 unsecured revolving credit facility and $ 10.0 million was available for future borrowings.

The 2020 unsecured revolving credit facility matured on May 1, 2022.

As of March 31, 2022, no amounts were outstanding under the 2020 unsecured revolving credit facility and $ 10.0 million was available for future borrowings.

Junior Subordinated Notes —The Company has junior subordinated notes with a variable interest rate which resets quarterly based on the three-month LIBOR plus 3.25 %, with quarterly interest only payments.

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The junior subordinated notes may be redeemed at par at the Company’s option.

SBA 7(a) Loan-Backed Notes —SBA 7(a) loan-backed notes are secured by deeds of trust or mortgages.

On May 30, 2018, the Company completed a securitization of the unguaranteed portion of certain of its SBA 7(a) loans receivable with the issuance of $ 38.2 million of unguaranteed SBA 7(a) loan-backed notes.

The SBA 7(a) loan-backed notes are collateralized solely by the right to receive payments and other recoveries attributable to the unguaranteed portions of certain of the Company’s SBA 7(a) loans receivable.

SBA 7(a) Loan-Backed Notes —On May 30, 2018, the Company completed a securitization of the unguaranteed portion of certain of its SBA 7(a) loans receivable with the issuance of $ 38.2 million of unguaranteed SBA 7(a) loan-backed notes.

The SBA 7(a) loan-backed notes are secured by deeds of trust or mortgages and are collateralized solely by the right to receive payments and other recoveries attributable to the unguaranteed portions of certain of the Company’s SBA 7(a) loans receivable.

The SBA 7(a) loan-backed notes mature on March 20, 2043, with monthly payments due as payments on the collateralized loans are received.

Based on the anticipated repayments of the Company’s collateralized SBA 7(a) loans, at issuance, the Company estimated the weighted average life of the SBA 7(a) loan-backed notes to be approximately two years .

Based on the anticipated repayments of the Company’s collateralized SBA 7(a) loans, at issuance, the Company estimated the weighted average remaining life of the SBA 7(a) loan-backed notes to be approximately two years .

The SBA 7(a) loan-backed notes bear interest at the lower of the one-month LIBOR plus 1.40 % or the prime rate less 1.08 %.

As of March 31, 2022 and December 31, 2021, the variable interest rate was 1.56 % and 1.49 %, respectively.

The Company reflects the SBA 7(a) loans receivable as assets on its consolidated balance sheets and the SBA 7(a) loan-backed notes as debt on its consolidated balance sheets.

The restricted cash on the Company’s consolidated balance sheets included funds related to the Company’s SBA 7(a) loan-backed notes of $ 1.9 million and $ 1.2 million as of September 30, 2021 and December 31, 2020, respectively.

The restricted cash on the Company’s consolidated balance sheets included funds related to the Company’s SBA 7(a) loan-backed notes of $ 2.0 million and $ 1.9 million as of March 31, 2022 and December 31, 2021, respectively.

Paycheck Protection Program Liquidity Facility —In June 2020, the Company commenced borrowing funds from the Federal Reserve through the PPP Liquidity Facility (the “PPPLF”) to finance all the loans the Company originated under the PPP.

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The maturity date of a PPPLF borrowing will be accelerated if, among other things, the Company has been reimbursed by the SBA for a loan forgiveness (to the extent of the forgiveness), the Company has received payment from the SBA representing exercise of the loan guarantee or the Company has received payment from the underlying borrower (to the extent of the payment received).

As of September 30, 2021, $ 7.6 million was outstanding under the PPPLF.

As of March 31, 2022 and December 31, 2021, $ 3.7 million and $ 5.0 million, respectively, was outstanding under the PPPLF.

As the PPP has ended, no new extensions of credit may be made under the PPPLF.

Deferred loan costs, which represent legal and third-party fees incurred in connection with the Company’s borrowing activities, are capitalized and amortized to interest expense on a straight-line basis over the life of the related loan, approximating the effective interest method.

Deferred loan costs are presented net of accumulated amortization and are a reduction to total debt.

As of September 30, 2021 and December 31, 2020, accrued interest and unused commitment fees payable of $ 529,000 and $ 564,000 , respectively, were included in accounts payable and accrued expenses.

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

Deferred debt issuance costs, which represent legal and third-party fees incurred in connection with the Company’s borrowing activities, are capitalized and amortized to interest expense on a straight-line basis over the life of the related loan, approximating the effective interest method.

Deferred debt issuance costs are presented net of accumulated amortization and are a reduction to total debt.

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

Future principal payments on the Company’s debt (face value) as of September 30, 2021 are as follows (in thousands):

March 31, 2022 (Unaudited) – (Continued)

As of March 31, 2022 and December 31, 2021, accrued interest and unused commitment fees payable of $ 473,000 and $ 467,000 , respectively, were included in accounts payable and accrued expenses.

Future principal payments on the Company’s debt (face value) as of March 31, 2022 are as follows (in thousands):

Years Ending December 31, Mortgage Payable Secured Borrowings Principal (1)

2018 Revolving Credit Facility Other (1) (2)

2021 (Three months ending December 31, 2021) $ — $ 469 $ — $ 1,206 $ 1,675

2022 (Nine months ending December 31, 2022) $ — $ 370 $ 90,000 $ 1,797 $ 92,167

2023 — 381 — 1,198 1,579

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STOCK-BASED COMPENSATION PLANS

On April 3, 2015, the Company’s board of directors (the “Board of Directors”) unanimously approved the CIM Commercial Trust Corporation 2015 Equity Incentive Plan (the “2015 Equity Incentive Plan”), which was approved by the Company’s stockholders.

On April 3, 2015, the Company’s board of directors (the “Board of Directors”) unanimously approved the Company’s 2015 Equity Incentive Plan (the “2015 Equity Incentive Plan”), which was approved by the Company’s stockholders.

Under the 2015 Equity Incentive Plan, the Company granted awards of restricted shares of Common Stock to each of the independent members of the Board of Directors as follows:

Grant Date (1) Vesting Date Restricted Shares of Common Stock - Individual Restricted Shares of Common Stock - Aggregate

May 2019 May 2020 889 3,556

July 2019 May 2020 (2) 81 324

May 2020 February 2021 (2) 5,478 5,478

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(1) Compensation expense related to these restricted shares of Common Stock is recognized over the vesting period, and generally vests based on one year of continuous service.

The Company recorded compensation expense related to these restricted shares of Common Stoc k in the amount of $ 55,000 and $ 55,000 for the three months ended September 30, 2021 and 2020, respectively, and $ 165,000 an d $ 167,000 for the nine months ended September 30, 2021 and 2020 , respectively.

(2) These shares vested in May 2020 concurrent with the vesting of the restricted shares of Common Stock granted in May 2019.

The Company recorded compensation expense related to these restricted shares of Common Stock in the amount of $ 55,000 and $ 60,000 for the three months ended March 31, 2022 and 2021, respectively.

(2) On February 11, 2021, the Company’s Board of Directors approved the immediate vesting of 5,478 shares that had been granted in May 2020 to a former independent member of the Board of Directors following his death.

(4) These shares will vest after one year of continuous service.

As of September 30, 2021, there was $ 128,000 of total unrecognized compensation expense related to restricted shares of Common Stock which will be recognized ratably over the remaining vesting period.

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

(3) These shares will vest after one year of continuous service, other than the shares granted to Mr.

Frank Golay, Jr., a former independent director of the Company, which vested on May 2, 2022.

Golay retired from the Board on May 2, 2022 and, in recognition of his service to the Company, the Board accelerated the vesting of Mr.

Golay’s shares.

As of March 31, 2022, there was $ 18,000 of total unrecognized compensation expense related to restricted shares of Common Stock which will be recognized ratably over the remaining vesting period.

EARNINGS PER SHARE ("EPS")

The computations of basic EPS are based on the Company’s weighted average shares outstanding.

For the three and nine months ended September 30, 2021, there was no difference in the diluted weighted average number of shares of Common Stock outstanding as compared the basic weighted average number of shares of Common Stock outstanding.

In order to calculate the diluted weighted average number of shares of Common Stock outstanding for the three and nine months ended September 30, 2020, the basic weighted average number of shares of Common Stock outstanding was increased by 0 and 108 shares, respectively, to reflect the dilutive effect of certain shares of the Company’s Series A Preferred Stock.

No shares of Series D Preferred Stock outstanding as of September 30, 2021 had a dilutive effect and no shares of Series D Preferred Stock were outstanding as of September 30, 2020.

Outstanding Series A Preferred Warrants were not included in the computation of diluted EPS for the three and nine months ended September 30, 2021 and 2020 because their impact was either anti-dilutive or such warrants were not exercisable during such periods (Note 10).

Outstanding shares of Series L Preferred Stock were not included in the computation of diluted EPS for the three and nine months ended September 30, 2021 and 2020 because such shares were not redeemable during such periods.

In order to calculate the diluted weighted average number of shares of Common Stock outstanding for the three months ended March 31, 2022, the

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 (Unaudited) – (Continued)

basic weighted average number of shares of Common Stock outstanding was increased by 2,477 shares to reflect the dilutive effect of certain shares of the Company’s Series A Preferred Stock, while no shares of Series A Preferred Stock outstanding as of March 31, 2021 were included in the computation of diluted EPS because they had no dilutive effect.

No shares of Series D Preferred Stock outstanding as of March 31, 2022 or 2021 were included in the computation of diluted EPS because they had no dilutive effect.

Outstanding Series A Preferred Warrants were not included in the computation of diluted EPS for the three months ended March 31, 2022 and 2021 because their impact was either anti-dilutive or such warrants were not exercisable during such periods (Note 11).

Outstanding shares of Series L Preferred Stock were not included in the computation of diluted EPS for the three months ended March 31, 2022 and 2021 because such shares were not redeemable during such periods.

EPS for the year-to-date period may differ from the sum of quarterly EPS amounts due to the required method for computing EPS in the respective periods.

In addition, EPS is calculated independently for each component and may not be additive due to rounding.

The following table reconciles the numerator and denominator used in computing the Company’s basic and diluted per-share amounts for net loss attributable to common stockholders for the three and nine months ended September 30, 2021 and 2020 (in thousands, except per share amounts):

Three Months Ended September 30, Nine Months Ended September 30,

2021 2020 2021 2020

The following table reconciles the numerator and denominator used in computing the Company’s basic and diluted per-share amounts for net loss attributable to common stockholders for the three months ended March 31, 2022 and 2021 (in thousands, except per share amounts):

Three Months Ended March 31,

Net loss attributable to common stockholders $ ( 2,811 ) $ ( 8,206 )

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Diluted $ ( 0.12 ) $ ( 0.55 )

REDEEMABLE PREFERRED STOCK

The table below provides information regarding the issuances, reclassifications and redemptions of each class of the Company’s preferred stock in permanent equity during the three and nine months ended September 30, 2021 and 2020 (dollar amounts in thousands):

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

March 31, 2022 (Unaudited) – (Continued)

REDEEMABLE PREFERRED STOCK

The table below provides information regarding the issuances, reclassifications and redemptions of each class of the Company’s preferred stock in permanent equity during the three months ended March 31, 2022 and 2021 (dollar amounts in thousands):

Preferred Stock

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Balances, March 31, 2021 4,715,291 $ 117,140 23,190 $ 572 5,387,160 $ 152,834 10,125,641 $ 270,546

Issuance of Series D Preferred Stock — $ — 920 $ 23 — $ — 920 $ 23

Reclassification of Series A Preferred Stock to permanent equity 427,064 10,638 — — — — 427,064 10,638

Redemption of Series A Preferred Stock ( 5,532 ) ( 138 ) — — — — ( 5,532 ) ( 138 )

Balances, June 30, 2020 3,560,448 88,660 6,900 173 5,387,160 152,834 8,954,508 241,667

Issuance of Series D Preferred Stock — $ — 11,837 $ 290 — $ — 11,837 $ 290

Reclassification of Series A Preferred Stock to permanent equity 482,374 11,786 — — — — 482,374 11,786

Redemption of Series A Preferred Stock ( 2,393 ) ( 60 ) — — — — ( 2,393 ) ( 60 )

Balances, September 30, 2020 4,040,429 $ 100,386 18,737 $ 463 5,387,160 $ 152,834 9,446,326 $ 253,683

Balances, December 31, 2021 6,271,337 $ 156,431 56,857 $ 1,396 5,387,160 $ 152,834 11,715,354 $ 310,661

Issuance of Series D Preferred Stock — — — — — — — —

Reclassification of Series A Preferred Stock to permanent equity 366,991 9,144 — — — — 366,991 9,144

Reclassification of Series A Preferred stock to Perm Equity 329,921 8,304 — — — — 329,921 8,304

Redemption of Series A Preferred Stock ( 49,341 ) ( 1,228 ) — — — — ( 49,341 ) ( 1,228 )

Balances, March 31, 2022 6,551,917 $ 163,507 56,857 $ 1,396 5,387,160 $ 152,834 11,995,934 $ 317,737

Issuance of Series D Preferred Stock — — 7,835 192 — — 7,835 192

Reclassification of Series A Preferred Stock to permanent equity 556,587 13,915 — — — — 556,587 13,915

Redemption of Series A Preferred Stock ( 18,501 ) ( 460 ) — — — — ( 18,501 ) ( 460 )

Balances, June 30, 2021 5,253,377 $ 130,595 31,025 $ 764 5,387,160 $ 152,834 10,671,562 $ 284,193

Issuance of Series D Preferred Stock — — 25,832 632 — — 25,832 632

Reclassification of Series A Preferred Stock to permanent equity 593,300 15,132 — — — — 593,300 15,132

Redemption of Series A Preferred Stock ( 25,564 ) ( 634 ) — — — — ( 25,564 ) ( 634 )

Balances, September 30, 2021 5,821,113 $ 145,093 56,857 $ 1,396 5,387,160 $ 152,834 11,265,130 $ 299,323

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

As of September 30, 2021, the Company had iss ued in regist ered public offerings 7,166,128 shares of Series A Preferred Stock, 4,603,287 Series A Preferred Warrants and 56,857 shares of Series D Preferred Stock and received gross proceeds of $ 180.5 million ($ 178.4 million of which was allocated to the Series A Preferred Stock, $ 761,000 of which was allocated to the Series A Preferred Warrants, and $ 1.4 million of which was allocated to the Series D Preferred Stock) and, additionally, had issued 387,810 shares of Series A Preferred Stock as payment for services to the Administrator, for which no cash proceeds were received.

As of March 31, 2022, the Company had issued in registered public offerings 7,949,521 shares of Series A Preferred Stock, 4,603,287 Series A Preferred Warrants and 56,857 shares of Series D Preferred Stock and received gross proceeds of $ 200.1 million ($ 197.9 million of which was allocated to the Series A Preferred Stock, $ 761,000 of which was allocated to the Series A Preferred Warrants, and $ 1.4 million of which was allocated to the Series D Preferred Stock) and, additionally, had issued 568,681 shares of Series A Preferred Stock as payment for services to the Administrator, for which no cash proceeds were received.

In connection with such issuance, costs specifically identifiable to the offering of Series A Preferred Stock, Series A Preferred Warrants and Series D Preferred Stock, such as commissions, dealer manager fees and other offering fees and expenses, totaled $ 16.6 million ($ 16.4 million of which was allocated to the Series A Preferred Stock, $ 142,000 of which was allocated to the Series A Preferred Warrants, and $ 35,000 of which was allocated to the Series D Preferred Stock).

In addition, as of September 30, 2021, non-issuance-specific costs related to this offering totaled $ 7.9 million.

As of September 30, 2021, the Company had reclassified and allocated $ 1.6 million, $ 5,000 and $ 7,000 from deferred charges to Series A Preferred Stock, Series A Preferred Warrants and Series D Preferred Stock, respectively, as a reduction to the gross proceeds received.

In addition, as of March 31, 2022, non-issuance-specific costs related to this offering totaled $ 8.2 million.

As of March 31, 2022, the Company had reclassified and allocated $ 1.8 million, $ 5,000 and $ 13,000 from deferred charges to Series A Preferred Stock, Series A Preferred Warrants and Series D Preferred Stock, respectively, as a reduction to the gross proceeds received.

Such reclassification was based on the cumulative number of securities issued relative to the maximum number of securities expected to be issued under the offering.

As of September 30, 2021, there were 7,369,997 shares of Series A Preferred Stock outstanding, 4,603,287 Series A Preferred Warrants to purchase 1,194,159 shares of Common Stock outstanding, and 56,857 shares of Series D Preferred Stock outstanding.

As of September 30, 2021, 183,941 shares of Series A Preferred Stock and no shares of Series D Preferred Stock had been redeemed.

As of March 31, 2022, there were 8,245,566 shares of Series A Preferred Stock outstanding, 4,458,589 Series A Preferred Warrants to purchase 1,156,393 shares of Common Stock outstanding, and 56,857 shares of Series D Preferred Stock outstanding.

As of March 31, 2022, 272,636 shares of Series A Preferred Stock and no shares of Series D Preferred Stock had been redeemed.

Series A Preferred Stock —The Company conducted a continuous public offering of Series A Preferred Units from October 2016 through January 2020, where each Series A Preferred Unit consisted of one share of Series A Preferred Stock, par value $ 0.001 per share, of the Company with an initial stated value of $ 25.00 per share, subject to adjustment, and one warrant to purchase 0.25 of a share of Common Stock.

Proceeds and expenses from the sale of the Series A Preferred Units were allocated to the Series A Preferred Stock and Series A Preferred Warrants using their relative fair values on the date of issuance.

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 (Unaudited) – (Continued)

Since February 2020, the Company has been conducting a continuous public offering with respect to shares of the Company’s Series A Preferred Stock, which, since such time, is no longer being issued as a unit with an accompanying Series A Preferred Warrant.

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Such adjustment is considered a deemed dividend for purposes of calculating basic and diluted EPS.

For the three and nine months ended September 30, 2021, the Company recorded redeemable preferred stock deemed divid ends of $ 90,000 and $ 253,000 , respectively, related to such adjustments.

For the three and nine months ended September 30, 2020, the Company recorded redeemable preferred stock deemed divid ends of $ 87,000 and $ 300,000 , respectively, related to such adjustments.

For the three months ended March 31, 2022 and 2021, the Company recorded redeemable preferred stock deemed divid ends of $ 15,000 and $ 57,000 , respectively, related to such adjustments.

On the first anniversary of the issuance of a particular share of Series A Preferred Stock, the Company reclassifies such share of Series A Preferred Stock from temporary equity to permanent equity because the feature giving rise to temporary equity classification, the requirement to satisfy redemption requests in cash, lapses on the first anniversary date.

As of September 30, 2021, the Company had reclassified an aggregate of $ 134.7 million in net proceeds from temporary equity to permanent equity.

As of March 31, 2022, the Company had reclassified an aggregate of $ 153.9 million in net proceeds from temporary equity to permanent equity.

Series D Preferred Stock —Since February 2020, the Company has been conducting a continuous public offering with respect to shares of its Series D Preferred Stock, par value $ 0.001 per share, subject to adjustment.

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These fees have been recorded as a reduction to the gross proceeds in permanent equity.

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

Until the fifth anniversary of the date of original issuance of the Series L Preferred Stock, the Company is prohibited from issuing any shares of preferred stock ranking senior to or on parity with the Series L Preferred Stock with respect to the payment of dividends, other distributions, liquidation, and or dissolution or winding up of the Company unless the Minimum Fixed Charge Coverage Ratio, calculated in accordance with the Articles Supplementary describing the Series L Preferred Stock, is equal to or greater than 1.25 :1.00.

As of September 30, 2021 and December 31, 2020 , the Company was in compliance with the Series L Preferred Stock Minimum Fixed Charge Coverage Ratio.

As of March 31, 2022 and December 31, 2021 , the Company was in compliance with the Series L Preferred Stock Minimum Fixed Charge Coverage Ratio.

Refer to Note 13 for a discussion of certain payments the Company has made in shares of Common Stock and in shares of Preferred Stock and may make in shares of Preferred Stock in lieu of cash payments in order to remain in compliance with the Series L Preferred Stock Minimum Fixed Charge Coverage Ratio.

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With respect to the distribution of amounts upon liquidation, dissolution or winding-up, the Series L Preferred Stock ranks senior to the Common Stock, both (i) to the extent of the Series L Preferred Stock Stated Value and (ii) following payment to holders of the Common Stock of an amount equal to any unpaid Initial Dividend, to the extent of any accrued and unpaid dividends on the Series L Preferred Stock, on parity with the Series A Preferred Stock and Series D Preferred Stock, to the extent of the Series L Preferred Stock Stated Value and junior to the Series A Preferred Stock, Series D Preferred Stock and Common Stock (to the extent of the Initial Dividend), in all instances with respect to any accrued and unpaid dividends on the Series L Preferred Stock.

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 (Unaudited) – (Continued)

Holders of Series A Preferred Stock are entitled to receive, if, as and when authorized by the Company’s Board of Directors, and declared by the Company out of legally available funds, cumulative cash dividends on each share of Series A Preferred Stock at an annual rate of 5.50 % of the Series A Preferred Stock Stated Value (i.e., the equivalent of $ 0.34375 per share per quarter) (the “Series A Dividend”).

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However, prior to the payment of any distributions on Series L Preferred Stock in respect of a given year, the Company must first declare and pay dividends on the Common Stock in respect of such year in an aggregate amount equal to the Initial Dividend announced by the Company’s Board of Directors at the end of the prior fiscal year.

On December 22, 2020, the Company announced an Initial Dividend on shares of its Common Stock for fiscal year 2021 in the aggregate amount of $ 4,448,223 , of which $ 3,979,000 had been paid as of September 30, 2021.

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

During the nine months ended September 30, 2021, the Company paid $ 7.0 million, $ 26,000 and $ 8.4 million of cash dividends on the Series A Preferred Stock, Series D Preferred Stock and Series L Preferred Stock, respectively.

During the nine months ended September 30, 2020, the Company paid $ 6.1 million, $ 4,000 and $ 8.4 million of cash dividends on the Series A Preferred Stock, Series D Preferred Stock and Series L Preferred Stock, respectively.

Redemptions —The Company’s Series A Preferred Stock and Series D Preferred Stock are redeemable at the option of the holder or CIM Commercial.

On December 29, 2021, the Company announced an Initial Dividend on shares of its Common Stock for fiscal year 2022 in the aggregate amount of $ 7,010,799 , of which $ 1,986,000 had been paid as of March 31, 2022.

During the three months ended March 31, 2022, the Company paid $ 2.7 million, $ 20,000 and $ 8.4 million of cash dividends on the Series A Preferred Stock, Series D Preferred Stock and Series L Preferred Stock, respectively.

During the three months ended March 31, 2021, the Company paid $ 2.2 million, $ 7,000 and $ 8.4 million of cash dividends on the Series A Preferred Stock, Series D Preferred Stock and Series L Preferred Stock, respectively.

Redemptions —The Company’s Series A Preferred Stock and Series D Preferred Stock are redeemable at the option of the holder or the Company.

The redemption schedule of the Series A Preferred Stock and Series D Preferred Stock allows redemptions at the option of the holder of Series A Preferred Stock or Series D Preferred Stock from the date of original issuance of any such shares at the Series A Preferred Stock Stated Value or Series D Preferred Stock Stated Value, respectively, less a redemption fee applicable prior to the fifth anniversary of the issuance of such shares, plus accrued and unpaid dividends.

CIM Commercial has the right to redeem the Series A Preferred Stock or Series D Preferred Stock after the fifth anniversary of the date of original issuance of such shares at the Series A Preferred Stock Stated Value or Series D Preferred Stock Stated Value, respectively, plus accrued and unpaid dividends.

The Company has the right to redeem the Series A Preferred Stock or Series D Preferred Stock after the fifth anniversary of the date of original issuance of such shares at the Series A Preferred Stock Stated Value or Series D Preferred Stock Stated Value, respectively, plus accrued and unpaid dividends.

At the Company’s discretion, the redemption price will be paid in cash or in Common Stock based on the volume weighted average price of the Company’s Common Stock for the 20 trading days prior to the redemption;

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Notwithstanding the foregoing, a holder of shares of the Company’s Series L Preferred Stock may require the Company to redeem such shares at any time prior to the fifth anniversary of the date of original issuance of the Series L Preferred Stock if (1) the Company does not declare and pay in full the distribution on the Series L Preferred Stock for any annual period prior to such fifth anniversary or (2) the Company does not declare and pay all accrued and unpaid distributions on the Series L Preferred Stock for all past dividend periods prior to the applicable holder redemption date.

The applicable redemption price payable upon redemption of any Series L Preferred Stock will be made, in the Company’s sole discretion, in the form of (A) cash in ILS at the then-current currency exchange rate determined in accordance with the Articles Supplementary defining the terms of the Series L Preferred Stock, (B) in equal value through the issuance of shares of Common Stock, with the value of such Common Stock to be deemed the lower of (i) the NAV per share of the Company’s Common Stock as most recently published by the Company as of the effective date of redemption and (ii) the volume-weighted average price of the Company’s Common Stock, determined in accordance with the Articles Supplementary defining the terms of the Series L Preferred Stock, or (C) in a combination of cash in ILS and the Company’s Common Stock, based on the conversion mechanisms set forth in (A) and (B), respectively.

The applicable redemption price payable upon redemption of any Series L Preferred Stock

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 (Unaudited) – (Continued)

will be made, in the Company’s sole discretion, in the form of (A) cash in ILS at the then-current currency exchange rate determined in accordance with the Articles Supplementary defining the terms of the Series L Preferred Stock, (B) in equal value through the issuance of shares of Common Stock, with the value of such Common Stock to be deemed the lower of (i) the NAV per share of the Company’s Common Stock as most recently published by the Company as of the effective date of redemption and (ii) the volume-weighted average price of the Company’s Common Stock, determined in accordance with the Articles Supplementary defining the terms of the Series L Preferred Stock, or (C) in a combination of cash in ILS and the Company’s Common Stock, based on the conversion mechanisms set forth in (A) and (B), respectively.

STOCKHOLDERS’ EQUITY

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In determining the Company’s dividend policy, the Board of Directors considers many factors including the amount of cash resources available for dividend distributions, capital spending plans, cash flow, the Company’s financial position, applicable requirements of the MGCL, any applicable contractual restrictions, and future growth in NAV and cash flow per share prospects.

Consequently, the dividend rate on a quarterly basis

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

does not necessarily correlate directly to any individual factor.

Cash dividends per share of Common Stock paid in respect of the nine months ended September 30, 2021 and 2020 consist of the following:

Consequently, the dividend rate on a quarterly basis does not necessarily correlate directly to any individual factor.

Cash dividends per share of Common Stock declared in respect of the three months ended March 31, 2022 and 2021 consist of the following:

Declaration Date Payment Date Type Cash Dividend Per Share of Common Stock

September 7, 2021 September 29, 2021 Regular Quarterly $ 0.075

June 7, 2021 June 30, 2021 Regular Quarterly $ 0.075

March 5, 2021 March 30, 2021 Regular Quarterly $ 0.075

September 2, 2020 September 29, 2020 Regular Quarterly $ 0.075

June 3, 2020 June 29, 2020 Regular Quarterly $ 0.075

March 8, 2022 April 1, 2022 Regular Quarterly $ 0.085

March 5, 2021 March 30, 2021 Regular Quarterly $ 0.075

Rights Offering

During the nine months ended September 30, 2021 , the Company conducted the Rights Offering pursuant to which the Company issued an aggregate of 8,521,589 shares of Common Stock at a subscription price of $ 9.25 per share for aggregate gross proceeds of $ 78.8 million.

Offering costs of $ 2.0 million were incurred in connection with the Rights Offering and recorded as a reduction to additional paid-in capital.

Series A Preferred Warrants

4 unchanged sentences

As of September 30, 2021, the Company had issued 4,603,287 Series A Preferred Warrants to purchase 1,194,159 shares of Common Stock in connection with the Company’s offering of Series A Preferred Units and allocated net proceeds of $ 614,000 , after specifically identifiable offering costs and allocated general offering costs, to the Series A Preferred Warrants in permanent equity.

As of March 31, 2022, the Company had 4,458,589 Series A Preferred Warrants outstanding to purchase 1,156,393 shares of Common Stock in connection with the Company’s offering of Series A Preferred Units and allocated net proceeds of $ 606,000 , after specifically identifiable offering costs and allocated general offering costs, to the Series A Preferred Warrants in permanent equity.

FAIR VALUE OF FINANCIAL INSTRUMENTS

4 unchanged sentences

Level 3 Inputs —Unobservable inputs

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 (Unaudited) – (Continued)

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy.

1 unchanged sentence

Management’s estimation of the fair value of the Company’s financial instruments is based on a Level 3 valuation in the fair value hierarchy established for disclosure of how a company values its financial instruments.

In general, quoted market prices from active markets for the identical financial instrument (Level 1 inputs), if available, should be used to value a

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

financial instrument.

In general, quoted market prices from active markets for the identical financial instrument (Level 1 inputs), if available, should be used to value a financial instrument.

If quoted prices are not available for the identical financial instrument, then a determination should be made if Level 2 inputs are available.

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The following describes the methods the Company uses to estimate the fair value of the Company’s financial assets and liabilities.

Investment in Unconsolidated Entity —The Company has elected the FVO for its equity method investment and, therefore, reports this investment at fair value.

To determine the fair value of the assets and liabilities of its equity method investment, the Company utilizes a discounted cash flow methodology, taking into consideration various factors including discount rate and exit capitalization rate.

After the fair value of the assets and liabilities are determined, the Company applies its ownership interest to the net asset value and reflects this amount as its equity method investment at fair value on the consolidated balance sheet.

The inputs used in determining the Company’s equity method investments carried at fair value are considered Level 3.

As the investment in the Unconsolidated Joint Venture was made in February 2022, the Company carried the investment at cost as of March 31, 2022 as it believes this approximates fair value.

Debt —The carrying amounts of the Company’s secured borrowings—government guaranteed loans, SBA 7(a) loan-backed notes, 2018 Revolving Credit Facility and borrowed funds from the Federal Reserve through the PPPLF approximate their fair values, as the interest rates on these securities are variable and approximate current market interest rates.

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These credit spreads take into account factors such as the Company’s credit standing, the maturity of the debt, whether the debt is secured or unsecured, and the loan-to-value ratios of the debt.

When estimating the fair value of the Company’s mortgages payable as of September 30, 2021 and December 31, 2020, the Company used a rate of 3.22 % and 3.38 %, respectively.

The rate used to estimate the fair value of the Company’s junior subordinated notes was 4.38 % and 4.49 % as of September 30, 2021 and December 31, 2020, respectively.

When estimating the fair value of the Company’s mortgages payable as of March 31, 2022 and December 31, 2021, the Company used a rate of 4.42 % and 3.22 %, respectively.

The rate used to estimate the fair value of the Company’s junior subordinated notes was 5.21 % and 4.46 % as of March 31, 2022 and December 31, 2021, respectively.

Loans Receivable —The Company determines the fair value of loans receivable by performing a present value analysis for the anticipated future cash flows using an appropriate market discount rate taking into consideration the credit risk and using an anticipated prepayment rate.

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The following summarizes the ranges of discount rates and prepayment rates used to arrive at the estimated fair values of the Company’s loans receivable:

September 30, 2021 December 31, 2020

March 31, 2022 December 31, 2021

Discount Rate Prepayment Rate Discount Rate Prepayment Rate

12 unchanged sentences

5.00 % - 17.50 %

Other Financial Instruments —The carrying amounts of the Company’s cash and cash equivalents, restricted cash, accounts receivable, accounts payable, and accrued expenses approximate their fair values due to their short-term maturities at September 30, 2021 and December 31, 2020.

Due to the short-term maturities of these instruments, Level 1 inputs are utilized to estimate the fair value of these financial instruments.

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

March 31, 2022 (Unaudited) – (Continued)

Due to the short-term maturities of these instruments, Level 1 inputs are utilized to estimate the fair value of these financial instruments.

The estimated fair values of those financial instruments which are not recorded at fair value on a recurring basis on the Company’s consolidated balance sheets are as follows (dollar amounts in thousands):

September 30, 2021 December 31, 2020

March 31, 2022 December 31, 2021

Amount Estimated

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______________________

(1) The carrying amounts for the mortgage payable and junior subordinated notes represents the principal outstanding amounts, excluding deferred loan costs and discounts.

(1) The carrying amounts for the mortgage payable and junior subordinated notes represents the principal outstanding amounts, excluding deferred debt issuance costs and discounts.

The estimated fair values of those financial instruments which are recorded at fair value on a recurring basis on the Company’s consolidated balance sheets are as follows (dollar amounts in thousands):

Estimated Fair Value

March 31, 2022 December 31, 2021 Level

Investment in unconsolidated entity (1) $ 22,528 $ — 3

______________________

(1) Represents the Company’s equity-method investment in 1910 Sunset Blvd which was acquired in February 2022 and was carried at cost as of March 31, 2022.

The following table details the Company’s share of the Unconsolidated Joint Venture measured at fair value on a recurring basis using Level 3 inputs ($ in thousands):

Investment in Unconsolidated Entity

Balance as of December 31, 2021 $ —

Purchases 22,408

Income from unconsolidated entity 120

Balance as of March 31, 2022 $ 22,528

RELATED-PARTY TRANSACTIONS

Asset Management and Other Fees to Related Parties

Asset Management Fees — CIM Urban and CIM Capital, LLC, an affiliate of CIM REIT and CIM Group (“CIM Capital”), have an investment management agreement, pursuant to which CIM Urban engaged CIM Capital to provide certain services to CIM Urban (the “Investment Management Agreement”).

Asset Management Fees;

Administrative Fees and Expenses — CIM Urban and CIM Capital, LLC, an affiliate of CIM REIT and CIM Group (“CIM Capital”), have an investment management agreement, pursuant to which CIM Urban engaged CIM Capital to provide certain services to CIM Urban (the “Investment Management Agreement”).

CIM Capital has assigned its duties under the Investment Management Agreement to its four wholly-owned subsidiaries:

CIM Capital Securities Management, LLC, a securities manager, CIM Capital RE Debt Management, LLC, a debt manager, CIM Capital Controlled Company Management, LLC, a controlled company manager, and CIM Capital Real Property Management, LLC, a real property manager.

CIM Capital Securities

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 (Unaudited) – (Continued)

Management, LLC, a securities manager, CIM Capital RE Debt Management, LLC, a debt manager, CIM Capital Controlled Company Management, LLC, a controlled company manager, and CIM Capital Real Property Management, LLC, a real property manager.

The “Operator” refers to CIM Capital and its four wholly-owned subsidiaries.

CIM Urban pays asset management fees to the Operator on a quarterly basis in arrears.

The fee is calculated as a percentage of the daily average adjusted fair value of CIM Urban’s assets (dollar amounts in thousands):

The Company and its subsidiaries have a master services agreement (the “Master Services Agreement”) with CIM Service Provider, LLC (the “Administrator”), an affiliate of CIM Group, pursuant to which the Administrator provides, or arranges for other service providers to provide, management and administration services to the Company and its subsidiaries.

Pursuant to the Master Services Agreement, the Company appointed an affiliate of CIM Group as the administrator of Urban Partners GP, LLC.

On January 5, 2022, the Company and certain of its subsidiaries entered into a Fee Waiver (the “Fee Waiver”) with the Operator and the Administrator with respect to fees that are payable to them.

The Fee Waiver is effective retroactively to January 1, 2022 (the “Effective Date”).

Pursuant to the Fee Waiver, the Administrator agreed to voluntarily waive any fees in excess of those set forth in the Fee Waiver, to the extent it would otherwise have been entitled to such additional compensation under the Master Service Agreement, and the Operator agreed to voluntarily waive any fees in excess of those set forth in the Fee Waiver, to the extent it would otherwise have been entitled to such additional compensation under the Investment Management Agreement.

A base asset management fee (the “Base Fee”) is payable quarterly in arrears to the Operator in an amount equal to an annual rate of 1 % (or 0.25 % per quarter) of the average of the “Net Asset Value Attributable to Common Stockholders” as of the first and last day of the applicable quarter.

Net Asset Value Attributable to Common stockholders is defined as (a) the sum of the Company’s (1) investments in real estate at fair value, (2) cash, (3) loans receivable at fair value and (4) the book value of the other assets of the Company, excluding deferred costs and net of other liabilities at book value, less (b) the Company’s (i) debt at face value, (ii) outstanding preferred stock at stated value, and (iii) non-controlling interests at book value;

provided, that, non-controlling interests in any UPREIT operating partnership relating to the Company shall not be excluded.

Subject to applicable laws and regulations under Nasdaq and the TASE and the agreement of the Operator, the Company will pay the Base Fee owed with respect to the first quarter of 2022 in shares of its Series A Preferred Stock and it is likely that the Company will pay some or part of the remainder of the Base Fees incurred during the year ended December 31, 2022 in shares of Series A Preferred Stock.

Incentive Fee:

An incentive fee (the “Revised Incentive Fee”) is payable quarterly in arrears to the Administrator with respect to the quarterly core funds from operations in excess of a quarterly threshold equal to 1.75 % (i.e., 7.00 % on an annualized basis) of the Company’s “Adjusted Common Equity” (as defined below) for such quarter (“Excess Core FFO”) as follows:

(i) no Incentive Fee in any quarter in which the Excess Core FFO is $ 0 ;

(ii) 100 % of any Excess Core FFO up to an amount equal to the product of (x) the average of the Adjusted Common Equity as of the first and last day of the applicable quarter and (y) 0.4375 %;

and (iii) 20 % of any Excess Core FFO thereafter.

Revised Incentive Fees payable for any partial quarter will be appropriately prorated.

“Adjusted Common Equity” means Common Equity plus Excluded Depreciation and Amortization.

“Common Equity” means Total Stockholders’ Equity minus Excluded Equity.

“Total Stockholders’ Equity” means the amount reflected as total stockholders’ equity in accordance with GAAP on the consolidated balance sheet of the Company and its subsidiaries as of the last day of a given quarter.

“Excluded Equity” means the sum of all preferred securities of the Company and its subsidiaries classified as permanent equity in accordance with GAAP on the consolidated balance sheet of the Company and its subsidiaries as of the last day of a given quarter.

“Excluded Depreciation and Amortization” means, for a given quarter, the amount of all accumulated depreciation and amortization of (i) the Company and its subsidiaries and (ii) to the extent allocable to the Company and its subsidiaries, the unconsolidated affiliates, in each case as of the last day of such quarter that corresponds to the periodic depreciation and amortization expense calculated in each case in accordance with GAAP that is a permitted add back to net income calculated in accordance with GAAP when calculating funds from operations.

Capital Gains Fee:

A capital gains fee (the “Capital Gains Fee”) is payable quarterly in arrears to the Administrator in an amount equal to (i) 15 % of the cumulative aggregate realized capital gains minus the cumulative aggregate realized capital losses (in each case since the Effective Date), minus (ii) the aggregate capital gains fees paid since the Effective Date.

Realized capital gains and realized capital losses are calculated by subtracting from the sales price of a property:

(a) any costs incurred to sell such property, and (b) the current gross value of the property (meaning the property’s

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 (Unaudited) – (Continued)

original acquisition price plus any subsequent, non-reimbursed capital improvements thereon paid for by the Company).

Following the end of each quarter, the Administrator will deliver to the Company (i) a calculation of the cumulative fees earned by the Operator and the Administrator under the methodology prescribed by the Fee Waiver (the “Fee Waiver Methodology”) from the Effective Date through the end of such quarter and (ii) a calculation of the cumulative fees that would have been earned, in the absence of the Fee Waiver, by the Operator and the Administrator during such period under the Master Services Agreement and the Investment Management Agreement, without giving effect to the Fee Waiver (the “Prior Methodology”).

If, in respect of any quarter, the aggregate fees that are payable under the Fee Waiver Methodology exceed the aggregate fees that would have been payable under the Prior Methodology for the equivalent period, such quarter is deemed an “Excess Quarter”.

For any quarter following an Excess Quarter, the Company (upon the direction of the independent members of the Board) may, at its option and upon written notice to Administrator, elect to calculate all fees due to the Administrator and the Operator in accordance with the Prior Methodology from and after such Excess Quarter.

Any election by the Company to adopt the Prior Methodology is irrevocable, and all fees due to the Administrator and the Operator from and after such election will be calculated in accordance with the Prior Methodology .

Pursuant to the Investment Management Agreement, the asset management fee prior to January 1, 2022 (the “Prior Asset Management Fee”) was calculated as a percentage of the daily average adjusted fair value of CIM Urban’s assets as follows (dollar amounts in thousands):

Daily Average Adjusted Fair

7 unchanged sentences

$ 4,000,000 $ 20,000,000 0.1000 %

Asset management fees are included in asset management and other fees to related parties in the accompanying consolidated statements of operations.

In lieu of cash payment of the asset management fee, the Company has issued to the Operator shares of its Common Stock and shares of its Series A Preferred Stock.

The Company has issued shares of its Series A Preferred Stock to the Operator as payment for the quarterly asset management fee for the first three quarters of 2021.

Subject to applicable laws and regulations under Nasdaq and the TASE and the agreement of the Operator, it is likely that the Company will seek to pay some or part of the fourth quarter asset management fees in shares of Series A Preferred Stock.

In lieu of cash payment of the Prior Asset Management Fee, the Company has issued to the Operator shares of its Series A Preferred Stock.

Subject to applicable laws and regulations under Nasdaq and the TASE and the agreement of the Operator, the Company will issue shares of its Series A Preferred Stock to the Operator as payment for the quarterly Prior Asset Management Fee for the quarter ended December 31, 2021.

Under the Master Services Agreement, for fiscal quarters prior to April 1,2020, the Company paid a base service fee (the “Base Service Fee”) to the Administrator initially set at $ 1.0 million per year (subject to an annual escalation by a specified inflation factor beginning on January 1, 2015), payable quarterly in arrears.

On May 11, 2020, the Master Services Agreement was amended to replace the Base Service Fee with an incentive fee (the “Prior Incentive Fee”) pursuant to which the Administrator was entitled to receive, on a quarterly basis, 15.00 % of the Company’s quarterly core funds from operations in excess of a quarterly threshold equal to 1.75 % (i.e., 7.00 % on an annualized basis) of the Company’s average Adjusted Common Equity (defined above) for such quarter.

The amendment was effective as of April 1, 2020 and was further modified by the Fee Waiver described above.

In addition, pursuant to the terms of the Master Services Agreement, the Administrator may receive compensation and or reimbursement for performing certain services for the Company and its subsidiaries that are not covered by the Base Service Fee or the Prior Incentive Fee, as the case may be.

During the three months ended March 31, 2022 and 2021, such services performed by the Administrator and its affiliates included accounting, tax, reporting, internal audit, legal, compliance, risk management, IT, human resources, corporate communications, operational and on-going support in connection with the Company’s offering of Preferred Stock.

The Administrator’s compensation is based on the salaries and benefits of the employees of the Administrator and or its affiliates who performed these services (allocated based on the percentage of time spent on the affairs of the Company and its subsidiaries).

The expense for such services is included in expense reimbursements to related parties—corporate in the accompanying consolidated statements of operations.

Property Management Fees and Reimbursements — CIM Management, Inc.

and certain of its affiliates (collectively, the “CIM Management Entities”), all affiliates of CIM REIT and CIM Group, provide property management, leasing, and

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

and certain of its affiliates (collectively, the “CIM Management Entities”), all affiliates of CIM REIT and CIM Group, provide property management, leasing, and development services to CIM Urban.

Property management fees earned by the CIM Management entities and onsite

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

development services to CIM Urban.

Property management fees earned by the CIM Management entities and onsite management costs incurred on behalf of CIM Urban are included in rental and other property operating expenses in the accompanying consolidated statements of operations.

March 31, 2022 (Unaudited) – (Continued)

management costs incurred on behalf of CIM Urban are included in rental and other property operating expenses in the accompanying consolidated statements of operations.

Leasing commissions earned are capitalized to deferred charges on the accompanying consolidated balance sheets.

Construction management fees are capitalized to investments in real estate on the accompanying consolidated balance sheets.

Administrative Fees and Expenses — CIM Commercial and its subsidiaries have a master services agreement (the “Master Services Agreement”) with CIM Service Provider, LLC (the “Administrator”), an affiliate of CIM Group, pursuant to which the Administrator provides, or arranges for other service providers to provide, management and administration services to CIM Commercial and its subsidiaries.

Pursuant to the Master Services Agreement, the Company appointed an affiliate of CIM Group as the administrator of Urban Partners GP, LLC.

Under the Master Services Agreement, CIM Commercial paid a base service fee (the “Base Service Fee”) to the Administrator initially set at $ 1.0 million per year (subject to an annual escalation by a specified inflation factor beginning on January 1, 2015), payable quarterly in arrears.

On May 11, 2020, the Master Services Agreement was amended to replace the Base Service Fee with an incentive fee (the “Incentive Fee”) pursuant to which the Administrator receives, on a quarterly basis, 15.00 % of CIM Commercial’s quarterly core funds from operations in excess of a quarterly threshold equal to 1.75 % (i.e., 7.00 % on an annualized basis) of CIM Commercial’s average adjusted common stockholders’ equity (i.e., common stockholders’ equity plus accumulated depreciation and amortization) for such quarter.

The amendment is effective as of April 1, 2020.

The Base Service Fee is included in asset management and other fees to related parties in the accompanying consolidated statements of operations.

In addition, pursuant to the terms of the Master Services Agreement, the Administrator may receive compensation and or reimbursement for performing certain services for CIM Commercial and its subsidiaries that are not covered by the Base Service Fee or the Incentive Fee, as the case may be.

During the nine months ended September 30, 2021 and 2020, such services performed by the Administrator and its affiliates included accounting, tax, reporting, internal audit, legal, compliance, risk management, IT, human resources, corporate communications, operational and on-going support in connection with the Company’s offering of Preferred Stock.

The expense for such services is included in expense reimbursements to related parties—corporate in the accompanying consolidated statements of operations.

Lending Segment Expenses — The Company has a Staffing and Reimbursement Agreement with CIM SBA Staffing, LLC (“CIM SBA”), an affiliate of CIM Group, and the Company’s subsidiary, PMC Commercial Lending, LLC.

1 unchanged sentence

The expense for such services is included in expense reimbursements to related parties—lending segment in the accompanying consolidated statements of operations.

Offering-Related Fees — The Company had an Amendment, Assignment and Assumption Agreement (the “Assignment Agreement”) with CCO Capital, LLC (“CCO Capital”).

Offering-Related Fees — CCO Capital, LLC (“CCO Capital”) became the exclusive dealer manager for the Company’s public offering of the Series A Preferred Units effective as of May 31, 2019.

CCO Capital is a registered broker dealer and is under common control with the Operator and the Administrator.

As a result of the Assignment Agreement, CCO Capital became the exclusive dealer manager for the Company’s public offering of the Series A Preferred Units effective as of May 31, 2019.

The Company’s offering of the Series A Preferred Units ended at the end of January 2020.

On January 28, 2020, the Company entered into the Second Amended and Restated Dealer Manager Agreement, pursuant to which CCO Capital acts as the exclusive dealer manager for the Company’s public offering of its Series A Preferred Stock and Series D Preferred Stock.

Thereunder, the Company agreed to pay CCO Capital, as the dealer manager for the offering, (1) an upfront dealer manager fee of up to 1.25 % of the selling price of each share of Preferred Stock sold, (2) selling commissions of up to 5.50 % of the selling price of each share of Series A Preferred Stock sold (with no selling commissions payable in respect of shares of Series D Preferred Stock sold) and (3) a trailing dealer manager fee that accrues daily in an amount equal to 1/365 th of 0.25 % per annum of the selling price of each share of Preferred Stock sold.

Thereunder, the Company agreed to compensate CCO Capital, as the dealer manager for the offering, as follows:

(1) an upfront dealer manager fee of up to 1.25 % of the selling price of each share of Preferred Stock sold, (2) selling commissions of up to 5.50 % of the selling price of each share of Series A Preferred Stock sold (with no selling commissions payable in respect of shares of Series D Preferred Stock sold) and (3) a trailing dealer manager fee that accrues daily in an amount equal to 1/365 th of 0.25 % per annum of the selling price of each share of Preferred Stock sold.

CCO Capital, in its sole discretion, may reallow to another broker-dealer authorized by it to sell shares in the offering a portion of the upfront dealer manager fee earned by it in respect of shares sold by such broker-dealer.

2 unchanged sentences

The Company has been informed that CCO Capital generally reallows 100 % of the selling commissions on sales of Series A Preferred Stock and generally reallows substantially all of the upfront dealer manager fee on sales of Series A Preferred Stock and Series D Preferred Stock, to participating broker-dealers.

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

On September 22, 2021, the Company entered into Amendment No.

2 to the Second Amended and Restated Dealer Manager Agreement, pursuant to which the upfront dealer manager fee payable to the Dealer Manager was changed to up to 3.00 % and the trailing dealer manager fee with respect to the sale of shares of Series A Preferred Stock sold in the Offering on or after September 9, 2021 was eliminated.

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 (Unaudited) – (Continued)

The Company recorded fees and expense reimbursements as shown in the table below for services provided by related parties related to the services described above during the periods indicated (in thousands):

Three Months Ended September 30, Nine months ended September 30,

2021 2020 2021 2020

Three Months Ended March 31,

Asset Management Fees:

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Administrative Fees and Expenses:

Base service fee (2)

$ — $ — $ — $ 282

Expense reimbursements to related parties - corporate $ 422 $ 605

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______________________

(1) The Company issued to the Operator an aggregate of 203,349 shares of our Common Stock and 190,459 shares of our Series A Preferred Stock , in lieu of cash payment of the asset management fees incurred during the nine months ended September 30, 2020 .

T he Company issued to the Operator 89,338 shares of Series A Preferred Stock in lieu of cash payment of the asset management fees incurred during the nine months ended September 30, 2021.

(2) For the nine months ended September 30, 2020, the Company issued to the Administrator 11,273 shares of Series A Preferred Stock, in lieu of cash as payment of the Base Service Fee incurred for the first quarter of 2020.

(3) As of September 30, 2021 and December 31, 2020, $ 2.0 million and $ 1.5 million, respectively, was included in deferred costs as reimbursable expenses incurred pursuant to the Master Services Agreement and the then applicable dealer manager agreement with CCO Capital.

(1) The Company issued to the Operator 89,338 shares of Series A Preferred Stock in lieu of cash payment of the asset management fees incurred during the three months ended March 31, 2021.

(2) Expense reimbursements to related parties - lending segment do not include personnel costs capitalized to deferred loan origination costs of $ 81,000 and $ 62,000 for the three months ended March 31, 2022 and 2021, respectively.

(3) Represents fees earned by CCO Capital and allocated to Series A Preferred Stock and Series D Preferred Stock.

(4) As of March 31, 2022 and March 31, 2021, $ 2.2 million and $ 1.7 million, respectively, was included in deferred costs as reimbursable expenses incurred pursuant to the Master Services Agreement and the then applicable dealer manager agreement with CCO Capital.

These non-issuance specific costs are allocated against the gross proceeds from the sale of the Series A Preferred Stock and the Series D Preferred Stock on a pro rata basis for each issuance as a percentage of the total offering.

As of September 30, 2021 and December 31, 2020, due to related parties consisted of the following (in thousands):

September 30, 2021 December 31, 2020

As of March 31, 2022 and December 31, 2021, due to related parties consisted of the following (in thousands):

March 31, 2022 December 31, 2021

Asset management fees $ 3,164 $ 2,244

6 unchanged sentences

Total due to related parties $ 5,812 $ 4,541

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

During the year ended December 31, 2020 , the Company’s President, Jan F.

Salit, retired effective as of September 16, 2020.

Salit received a $ 450,000 payment, representing one year of his base salary, upon the satisfaction of certain conditions specified therein, including the execution of an agreement with the Company that contains, among other things, mutual release and non-disparagement provisions.

Related to this payment, $ 287,000 was borne by the Company based on the time that Mr.

Salit devoted to the Company relative to other matters relating to CIM Group.

On October 1, 2015, an affiliate of CIM Group entered into a five-year lease renewal with respect to a property owned by the Company.

The lease was amended to a month-to-month term in February 2019 and was terminated in October 2020.

The Company recorded rental and other property income related to this tenant of $ 0 and $ 29,000 for the three months ended September 30, 2021 and 2020, respectively, and $ 0 and $ 87,000 for the nine months ended September 30, 2021 and 2020, respectively.

March 31, 2022 (Unaudited) – (Continued)

Affiliate Investments

In February 2022, the Company invested with a CIM-managed separate account (the “CIM JV Partner”) in the Unconsolidated Joint Venture which purchased an office property in Los Angeles, California for approximately $ 51.0 million, gross of proration amounts, of which the Company initially contributed approximately $ 22.4 million and the CIM JV Partner initially contributed the remaining balance.

See Note 2 and Note 4 for more information.

On May 15, 2019, CIM Group entered into an approximately 11-year lease for approximately 32,000 rentable square feet with respect to a property owned by the Company.

The lease was amended on August 7, 2019 to reduce the rentable square feet to approximately 30,000 rentable square feet.

The Company recorded rental and other property income related to this tenant of $ 370,000 and $ 1.1 million for the three and nine months, respectively, ended on each of September 30, 2021 and 2020.

For the three months ended March 31, 2022 and 2021, the Company recorded rental and other property income related to this tenant of $ 370,000 and $ 370,000 , respectively.

COMMITMENTS AND CONTINGENCIES

Loan Commitments —Commitments to extend credit are agreements to lend to a customer when the terms established in the contract are met.

The Company’s outstanding commitments to fund loans were $ 24.4 million as of September 30, 2021, the majority of which are for prime-based loans to be originated by the Company’s subsidiary engaged in SBA 7(a) Small Business Loan Program lending, the government guaranteed portion of which is intended to be sold.

The Company’s outstanding commitments to fund loans were $ 16.4 million as of March 31, 2022, the majority of which are for prime-based loans to be originated by the Company’s subsidiary engaged in SBA 7(a) Small Business Loan Program lending, the government guaranteed portion of which is intended to be sold.

Commitments generally have fixed expiration dates.

1 unchanged sentence

General —In connection with the ownership and operation of real estate properties, the Company has certain obligations for the payment of tenant improvement allowances and lease commissions in connection with new leases and renewals.

CIM Commercial had a total of $ 8.1 million in future obligations under leases to fund tenant improvements and other future construction obligations as of September 30, 2021.

As of September 30, 2021, $ 2.5 million was funded to reserve accounts included in restricted cash on the Company’s consolidated balance sheet for these tenant improvement obligations in connection with the mortgage loan agreement entered into in June 2016.

The Company had a total of $ 6.7 million in future obligations under leases to fund tenant improvements and other future construction obligations as of March 31, 2022.

As of March 31, 2022, $ 2.5 million was funded to reserve accounts included in restricted cash on the Company’s consolidated balance sheet for these tenant improvement obligations in connection with the mortgage loan agreement entered into in June 2016.

Employment Agreements —The Company has an employment agreement with one of its officers.

8 unchanged sentences

While it is possible that a loss may be incurred, the Company is unable to estimate a range of potential losses due to the complexity and current status of the lawsuit.

However, the Company maintains insurance coverage to mitigate the impact of adverse exposures in lawsuits of this nature and do not expect this

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

However, the Company maintains insurance coverage to mitigate the impact of adverse exposures in lawsuits of this nature and do not expect this lawsuit to have a material adverse effect on the Company’s business, financial condition, results of operations, cash flow or the Company ability to satisfy its debt service obligations or to maintain the level of distributions on the Company’s Common Stock or Preferred Stock.

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

lawsuit to have a material adverse effect on the Company’s business, financial condition, results of operations, cash flow or the Company ability to satisfy its debt service obligations or to maintain the level of distributions on the Company’s Common Stock or Preferred Stock.

SBA Related —If the SBA establishes that a loss on an SBA guaranteed loan is attributable to significant technical deficiencies in the manner in which the loan was originated, funded or serviced under the PPP or the SBA 7(a) Small Business Loan Program, the SBA may seek recovery of the principal loss related to the deficiency from the Company.

March 31, 2022 (Unaudited) – (Continued)

Loan Program, the SBA may seek recovery of the principal loss related to the deficiency from the Company.

As of March 31, 2022, the Company serviced an aggregate of $ 266.5 million of the guaranteed portion of SBA 7(a) loans.

With respect to the guaranteed portion of SBA loans that have been sold, the SBA will first honor its guarantee and then seek compensation from the Company in the event that a loss is deemed to be attributable to technical deficiencies.

3 unchanged sentences

The Company has not been notified by any governmental authority of any noncompliance, liability, or other claim in connection with any of the properties, and the Company is not aware of any other environmental condition with respect to any of the properties that management believes will have a material adverse effect on the Company’s business, financial condition, results of operations, cash flow or the Company’s ability to satisfy its debt service obligations or to maintain its level of distributions on Common Stock or Preferred Stock.

Future minimum rental revenue under long-term operating leases as of September 30, 2021, excluding tenant reimbursements of certain costs, are as follows (in thousands):

Future minimum rental revenue under long-term operating leases as of March 31, 2022, excluding tenant reimbursements of certain costs, are as follows (excludes unconsolidated properties, in thousands):

Years Ending December 31, Total

2021 (Three months ending December 31, 2021) $ 11,286

2022 (Nine months ending December 31, 2022) $ 33,549

Thereafter 34,517

SEGMENT DISCLOSURE

The Company’s reportable segments during the three and nine months ended September 30, 2021 and 2020 consist of two types of commercial real estate properties, namely, office and hotel, as well as a segment for the Company’s lending business.

The Company’s reportable segments during the three months ended March 31, 2022 and 2021 consist of two types of commercial real estate properties, namely, office and hotel, as well as a segment for the Company’s lending business.

Management internally evaluates the operating performance and financial results of the segments based on net operating income.

3 unchanged sentences

For the Company’s lending segment, the Company defines net operating income as interest income net of interest expense and general overhead expenses.

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

The net operating income (loss) of the Company’s segments for the three and nine months ended September 30, 2021 and 2020 is as follows (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2021 2020 2021 2020

March 31, 2022 (Unaudited) – (Continued)

The net operating income (loss) of the Company’s segments for the three months ended March 31, 2022 and 2021 is as follows (in thousands):

Three Months Ended March 31,

Revenues $ 14,105 $ 13,527

3 unchanged sentences

Total property expenses 6,211 5,740

Income from unconsolidated entity 120 —

Segment net operating income—office 8,014 7,787

13 unchanged sentences

Total segment net operating income $ 12,156 $ 9,086

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

A reconciliation of segment net operating income to net income attributable to the Company for the three and nine months ended September 30, 2021 and 2020 is as follows (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2021 2020 2021 2020

March 31, 2022 (Unaudited) – (Continued)

A reconciliation of segment net operating income to net income attributable to the Company for the three months ended March 31, 2022 and 2021 is as follows (in thousands):

Three Months Ended March 31,

Total segment net operating income $ 12,156 $ 9,086

5 unchanged sentences

Depreciation and amortization ( 5,004 ) ( 5,037 )

Loss on early extinguishment of debt — ( 281 ) — ( 281 )

Income (loss) before provision for income taxes 2,609 ( 3,297 )

(Provision) benefit for income taxes ( 946 ) 18 ( 2,316 ) 731

Provision for income taxes ( 307 ) ( 374 )

Net income (loss) 2,302 ( 3,671 )

1 unchanged sentence

Net income (loss) attributable to the Company $ 2,297 $ ( 3,670 )

The condensed assets for each of the segments as of September 30, 2021 and December 31, 2020, along with capital expenditures and loan originations for the nine months ended September 30, 2021 and 2020, are as follows (in thousands):

September 30, 2021 December 31, 2020

The condensed assets for each of the segments as of March 31, 2022 and December 31, 2021, along with capital expenditures and loan originations for the three months ended March 31, 2022 and 2021, are as follows (in thousands):

March 31, 2022 December 31, 2021

Condensed assets:

4 unchanged sentences

Total assets $ 688,265 $ 660,866

Nine Months Ended September 30,

Three Months Ended March 31,

Capital expenditures (1) and loan originations:

Office $ 1,392 $ 292

Hotel 144 801

Total capital expenditures 1,400 320

4 unchanged sentences

Includes the activity for dispositions through their respective disposition dates.

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

CREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 (Unaudited) – (Continued)

March 31, 2022 (Unaudited) – (Continued)

SUBSEQUENT EVENTS

The Company evaluated events subsequent to September 30, 2021, and concluded that no subsequent events have occurred that would require recognition or disclosure in the consolidated unaudited financial statements.

The Company evaluated events subsequent to March 31, 2022, and concluded that no subsequent events have occurred that would require recognition or disclosure in the consolidated unaudited financial statements.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements