See Part I, “Forward-Looking Statements” for our caution regarding forward-looking information.

This discussion and analysis is based on, should be read together with, and is
qualified in its entirety by, the consolidated financial statements and notes
thereto included in Item 15(a)1 of this Form 10-K, beginning at page F-1. It
also should be read in conjunction with the disclosure under "Forward-Looking
Statements" in Part 1 of this Form 10-K. When this report uses the words "we,"
"us," "our," "Tejon," "TRC," and the "Company," they refer to Tejon Ranch Co.
and its subsidiaries, unless the context otherwise requires. References herein
to fiscal year refer to our fiscal years ended or ending December 31.

PREVIEW

Our business

We are a diversified real estate development and agribusiness company committed
to responsibly using our land and resources to meet the housing, employment, and
lifestyle needs of Californians and to create value for our shareholders. In
support of these objectives, we have been investing in land planning and
entitlement activities for new industrial and residential land developments and
in infrastructure improvements within our active industrial development. Our
prime asset is approximately 270,000 acres of contiguous, largely undeveloped
land that, at its most southerly border, is 60 miles north of Los Angeles and,
at its most northerly border, is 15 miles east of Bakersfield.

Our business model is designed to create value through the execution of
commercial/industrial development, entitlement and development of land for
resort/residential uses, and the maximization of earnings from operating assets,
while at the same time protecting significant portions of our land for
conservation purposes. We operate our business near one of the country's largest
population centers, which is expected to continue to grow well into the future.

We currently operate in five business segments: commercial/industrial real estate development; resort/residential real estate development; mineral resources; Agriculture; and ranch operations.

Our commercial/industrial real estate segment generates revenues from real
estate leases, and land and building sales. The primary commercial/industrial
development is TRCC. The resort/residential real estate development segment is
actively involved in the land entitlement and development process internally and
through a joint venture. Within our resort/residential segment, the three active
mixed-use master plan developments are MV, Centennial, and Grapevine. Our
mineral resources segment generates revenues from oil and gas royalty leases,
rock and aggregate mining leases, a lease with National Cement and sales of
water. The farming segment produces revenues from the sale of wine grapes,
almonds, and pistachios. Lastly, the ranch operation segment consists of game
management revenues and ancillary land uses such as grazing leases and filming.

Financial Highlights

For 2021, net income attributable to common stockholders was $5,348,000 compared
to net loss attributed to common stockholders of $740,000 in 2020. Over the
comparative period, commercial/industrial segment profits and our share of
equity in earnings from our unconsolidated joint ventures increased $5,109,000
and $4,698,000, respectively. The increase in
                                       38
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commercial/industrial segment profits was attributable to two land parcels sales
comprised of 55.96 acres for a total of $10,035,000. The increase in equity in
earnings was primarily attributable to our share of the sale of lots 18 and 19
held by our joint venture with Rockefeller. Additionally, profits from mineral
resources segment increased by $3,106,000 as a result of more water sales during
the year due to dry 2021 winter conditions and low SWP allocations. The above
mentioned increases were partially offset by a decline in farming segment
profits of $1,840,000. The decline was primarily attributable to a decline in
almond revenues due to supply chain disruptions and a decrease in pistachio
revenue due to reduced insurance proceeds received when compared to the prior
year.

For 2020, net loss attributable to common stockholders was $740,000 compared to
net income attributed to common stockholders of $10,580,000 in 2019. Our
commercial/industrial segment greatly influenced our 2020 operating results.
Over the comparative period, commercial/industrial segment revenues and results
from our commercial joint ventures declined $7,256,000 and $12,071,000,
respectively. The decline is primarily attributed to the fact that in 2019,
there were several major real estate asset contributions and sales made by the
Company to its joint ventures, as described below, that did not occur in 2020.
From a joint venture operations standpoint, our share of TA/Petro operating
results declined $3,088,000 after experiencing the effects of California's
stay-at-home orders and other social distancing initiatives. Those factors
resulted in lower fuel volumes that led to lower fuel margins. Additionally,
TA/Petro had closed down its full service restaurants for most of the year as
capacity limitations made operating economically unfeasible. Our farming segment
saw a $5,465,000 decline in revenues as a result of lower pistachio bonuses,
pistachio yields, and a decline in almond pricing. Declines in revenues were
partially offset by lower commercial expense, as a result of reduced cost of
sales of $5,839,000 and income taxes of $3,151,000. Additionally, the Company
benefited from recognizing a gain on sale of building and land of $1,331,000
along with experiencing a $1,934,000 reduction in other expense primarily
associated with the disposal of a wine grape vineyard in 2019.

During 2022, we will continue to invest funds towards litigation defense,
permits, and maps for our master plan mixed-use developments and for master
project infrastructure and vertical development within our active commercial and
industrial development. Securing entitlements for our land is a long, arduous
process that can take several years and involves litigation. During the next few
years, our net income will fluctuate from year-to-year based upon, among other
factors, commodity prices, production within our farming segment, the timing of
land sales and the leasing of land and/or industrial space within our industrial
developments, and equity in earnings realized from our unconsolidated joint
ventures.

This Management's Discussion and Analysis of Financial Condition and Results of
Operations provides a narrative discussion of our results of operations. It
contains the results of operations for each operating segment of the business
and is followed by a discussion of our financial position. It is useful to read
the business segment information in conjunction with Note 16 (Reporting Segments
and Related Information) of the Notes to Consolidated Financial Statements.

Critical accounting estimates

The preparation of our consolidated financial statements in accordance with
generally accepted accounting principles in the United States, or GAAP, requires
us to make estimates and judgments that affect the reported amounts of assets,
liabilities, revenues and expenses, and related disclosure of contingent assets
and liabilities. We consider an accounting estimate to be critical if: (1) the
accounting estimate requires us to make assumptions about matters that were
highly uncertain at the time the accounting estimate was made, and (2) changes
in the estimates that are likely to occur from period to period, or use of
different estimates that we reasonably could have used in the current period,
would have a material impact on our financial condition or results of
operations. On an on-going basis, we evaluate our estimates, including those
related to revenue recognition, impairment of long-lived assets, capitalization
of costs, allocation of costs related to land sales and leases, and stock
compensation. We base our estimates on historical experience and on various
other assumptions that are believed to be reasonable under the circumstances,
the results of which form the basis for making judgments about the carrying
values of assets and liabilities that are not readily apparent from other
sources. Actual results may differ from these estimates under different
assumptions or conditions.

Management has discussed the development and selection of these critical
accounting estimates with the Audit Committee of our Board of Directors and the
Audit Committee has reviewed the foregoing disclosure. In addition, there are
other items within our financial statements that require estimation, but are not
deemed critical as defined above. Changes in estimates used in these and other
items could have a material impact on our financial statements. See also Note 1
(Summary of Significant Accounting Policies) of the Notes to Consolidated
Financial Statements, which discusses accounting policies that we have selected
from acceptable alternatives.

We believe that the following critical accounting estimates reflect our most significant judgments and estimates used in the preparation of the consolidated financial statements:

Impairment of Long-Lived Assets - We evaluate our property and equipment and
development projects for impairment on an ongoing basis. Our evaluation for
impairment involves an initial assessment of each real estate development to
determine
                                       39
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whether events or changes in circumstances exist that may indicate that the
carrying amounts of a real estate development are no longer recoverable.
Possible indications of impairment may include events or changes in
circumstances affecting the entitlement process, government regulation,
litigation, geographical demand for new housing, and market conditions related
to pricing of new homes. When events or changes in circumstances indicate that
the carrying value of assets contained in our financial statements may not be
recoverable.

We make significant assumptions to evaluate each real estate development for
possible indications of impairment. These assumptions include the identification
of appropriate and comparable market prices, the consideration of changes to
legal factors or the business climate, and assumptions surrounding continued
positive cash flows and development costs. Considering that the planned
development communities will be in a location that does not currently have many
comparable homes, the Company must make assumptions surrounding the expected
ability to sell the real estate assets at a price that is in excess of current
accumulated costs. We use our internal forecasts and business plans to estimate
future prices, absorption, production, and costs. We develop our forecasts based
on recent sales data, historical absorption and production data, input from
marketing consultants, as well as discussions with commercial real estate
brokers and potential purchasers of our farming products.

The impairment calculation compares the carrying value of the asset to the
asset's estimated future cash flows (undiscounted). If the estimated future cash
flows are less than the carrying value of the asset, we calculate an impairment
loss. The impairment loss calculation compares the carrying value of the asset
to the asset's estimated fair value, which may be based on estimated future cash
flows (discounted). We recognize an impairment loss equal to the amount by which
the asset's carrying value exceeds the asset's estimated fair value. If we
recognize an impairment loss, the adjusted carrying amount of the asset will be
its new cost basis. For a depreciable long-lived asset, the new cost basis will
be depreciated (amortized) over the remaining useful life of that asset.
Restoration of a previously recognized impairment loss is prohibited. If actual
results are not consistent with our assumptions and judgments used in estimating
future cash flows and asset fair values, we may be exposed to impairment losses
that could be material to our results of operations.

Currently, there are no assets within any of our operating segments that we believe are at risk of impairment due to market conditions and we have not identified any indicators of depreciation.

We believe that the accounting estimate related to asset impairment is a
critical accounting estimate because it is very susceptible to change from
period to period; it requires management to make assumptions about future
prices, production, and costs, and the potential impact of a loss from
impairment could be material to our earnings. Management's assumptions regarding
future cash flows from real estate developments and farming operations have
fluctuated in the past due to changes in prices, absorption, production and
costs and are expected to continue to do so in the future as market conditions
change.

Allocation of Costs Related to Land Sales and Leases - When we sell or lease
land within one of our real estate developments, as we are currently doing
within TRCC, and we have not completed all infrastructure development related to
the total project, we determine the appropriate costs of sales for the sold land
and the timing of recognition of the sale. In the calculation of cost of sales
or allocations to leased land, we use estimates and forecasts to determine total
costs at completion of the development project. These estimates of final
development costs can change as conditions in the market and costs of
construction change.

In preparing these estimates, we use internal budgets, forecasts, and
engineering reports to help us estimate future costs related to infrastructure
that has not been completed. These estimates become more accurate as the
development proceeds forward, due to historical cost numbers and to the
continued refinement of the development plan. These estimates are updated
periodically throughout the year so that, at the ultimate completion of
development, all costs have been allocated. Any increases to our estimates in
future years will negatively impact net profits and liquidity due to an
increased need for funds to complete development. If, however, this estimate
decreases, net profits as well as liquidity will improve.

We believe that the estimates used related to cost of sales and allocations to
leased land are critical accounting estimates and will become even more
significant as we continue to move forward as a real estate development company.
The estimates used are very susceptible to change from period to period, due to
the fact that they require management to make assumptions about costs of
construction, absorption of product, and timing of project completion, and
changes to these estimates could have a material impact on the recognition of
profits from the sale of land within our developments.

Recent accounting pronouncements

For a discussion of recent accounting pronouncements, see Note 1 (Summary of Significant Accounting Policies) to the Notes to the Consolidated Financial Statements.

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Operating results by segment

We evaluate the performance of our reporting segments separately to monitor the
different factors affecting financial results. Each reporting segment is subject
to review and evaluation as we monitor current market conditions, market
opportunities, and available resources. The performance of each reporting
segment is discussed below:

Real Estate – Commercial/Industrial

($ in thousands)                                 2021         2020          

2019

Commercial/industrial revenues
Pastoria Energy Facility Lease                $  4,380      $ 4,584      $  

4,573

TRCC Leasing                                     1,724        1,744         

1,815

TRCC management fees and reimbursements            692          715         1,172
Commercial leases                                  627          580           658
Communication leases                               952          927           924
Landscaping and other                            1,066          986         1,029
Land sales                                      10,035            -         6,621
Total commercial revenues                     $ 19,476      $ 9,536      $ 16,792
Total commercial expenses                     $ 11,953      $ 7,122      $ 12,961

Commercial/industrial operating result $7,523 $2,414 $3,831


2021 Operational Highlights:

•During 2021, commercial/industrial segment revenues increased $9,940,000, or
104%, from $9,536,000 in 2020 to $19,476,000. During 2021, the Company sold two
land parcels, comprised of 55.96 acres, for $10,035,000. The first sale
comprised of a 38.86 acre land parcel contributed with a fair value of
$8,464,000 to TRC-MRC 4, LLC. The Company recognized revenues of $5,679,000 and
deferred profit of $2,785,000 after applying the five-step revenue recognition
model in accordance with ASC Topic 606 - Revenue From Contracts With Customers
and ASC Topic 323, Investments - Equity Method and Joint Ventures. The second
sale was to a third party for a 17.1 acre parcel for total consideration of
$4,665,000. Under the terms of the sale, the Company recognized $4,355,000 in
revenues and deferred $300,000 that will be recognized upon completion of a
performance obligation in 2022. There were no land sales in 2020.

•Commercial/industrial real estate segment expenses increased $4,831,000, or
68%, from $7,122,000 in 2020 to $11,953,000 in 2021. The increase in expenses is
primarily attributed to land cost of sales of $4,246,000 and an increase in TCWD
water assessments of $535,000 that is associated with the drought conditions.

•Please refer to Section 1, “Business – Real Estate Development Overview” for a discussion of minimum rent deferrals resulting from the COVID-19 pandemic.

2020 operational highlights:

•During 2020, commercial/industrial segment revenues decreased $7,256,000, or
43%, from $16,792,000 in 2019 to $9,536,000. During 2020, the Company did not
have any land sales, which contributed $6,621,000 of the decrease. Additionally,
management fees and reimbursements decreased $457,000 primarily because there
were no real estate construction projects in 2020.

•  Commercial/industrial real estate segment expenses decreased $5,839,000, or
45%, from $12,961,000 in 2019 to $7,122,000 in 2020. In the absence of land
sales, there was a $4,745,000 decrease in land cost of sales. The remainder of
the decrease is attributed to lower fixed water assessments from TCWD.

For 2022, TRCC will continue to be the driver of new activity within the Company
as construction is completed on a 629,274 square-foot industrial building,
anticipated construction commencement of a multi-family project in late 2022,
and finalizing plans for an up to 445,000 square-foot building that will begin
construction in 2023. We also expect the commercial/industrial segment to
continue to experience operating costs, net of amounts capitalized, primarily
related to professional service fees, marketing, commissions, planning, and
staffing costs as we continue to pursue these development opportunities. These
costs are expected to remain consistent with current levels of expense with any
variability in the future tied to specific absorption transactions in any given
year. TCWD water assessments may vary depending on water availability and its
ability to sell water.
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The actual timing and completion of development is difficult to predict due to
the uncertainties of the market. Infrastructure development and marketing
activities and costs will continue over several years as we develop our land
holdings. Prices for building materials such as concrete and steel have
increased over the past year and have longer than usual lead times. We will also
continue to evaluate land resources to determine the highest and best uses for
our land holdings. Future sales of land are dependent on market circumstances
and specific opportunities. Our goal in the future is to increase land value and
create future revenue growth through planning and development of commercial and
industrial properties.

See Article 1, “Business – Real Estate Development Overview” for a discussion of the market outlook for next year.

Real Estate – Resort/Residential

Our resort/residential segment activities include defending entitlements, land
planning and pre-construction engineering and conservation activities for our
Centennial, Grapevine, and MV projects.

We are in the preliminary stages of development; therefore, no revenue is attributed to this segment for these reporting periods.

2021 operational highlights:

•In 2021, resort/residential segment expenses increased $111,000 to $1,723,000,
or 7%, when compared to $1,612,000 in 2020. The increase is primarily associated
with payroll expenses net of capitalization associated with the Company's
development efforts.

2020 operational highlights:

•In 2020, resort/residential segment expenses decreased $635,000 to $1,612,000,
or 28%, when compared to $2,247,000 in 2019. The decrease is attributed to an
$801,000 decrease in professional services as there were fewer strategic
planning efforts in 2020. This decrease was partially offset by a $171,000
increase in payroll and overhead costs, net of capitalization, as a result of
right sizing initiatives and the issuance of performance based stock
compensation.

The resort/residential segment will continue to incur costs in the future
related to professional service fees, public relations costs, and staffing costs
as we continue forward with permitting activities for the above communities. We
expect these expenses to remain consistent with current years cost in the near
term and only begin to increase as we move into the development phase of each
project in the future. The actual timing and completion of entitlement-related
activities and the beginning of development is difficult to predict due to the
uncertainties of the approval process, the length of time related to litigation
defense, and the status of the economy. We will also continue to evaluate land
resources to determine the highest and best use for our land holdings. Our
long-term goal through this process is to increase the value of our land and
create future revenue opportunities through resort and residential development.

We are continuously monitoring the markets in order to identify the appropriate
time in the future to begin infrastructure improvements and lot sales. Our
long-term business plan of developing the communities of MV, Centennial, and
Grapevine remains unchanged. As home buyer trends change in California to a more
suburban orientation and the economy stabilizes, we believe the perception of
land values will also begin to improve. Long-term macro fundamentals, primarily
California's population growth and household formation will also support housing
demand in our region. California also has a significant documented housing
shortage, which we believe our communities will help ease as the population base
within California continues to grow.

See Section 1, “Business – Real Estate Development Overview” for a more in-depth discussion of real estate development activities.

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Mineral resources

         ($ in thousands)                                2021          2020         2019
         Mineral resources revenues
         Oil and gas                                  $    737      $    654      $ 1,842
         Rock aggregate                                  1,910         1,407        1,467
         Cement                                          2,210         2,214        1,908
         Exploration leases                                119           100          101
         Water sales                                    15,523         5,909        3,997
         Reimbursables and other                           488          

452 476

         Total mineral resources revenues             $ 20,987      $ 

10,736 $9,791

         Total mineral resources expenses             $ 13,559      $ 

6,414 $5,818

         Operating income from mineral resources      $  7,428      $  4,322      $ 3,973


                                                                     2021                  2020                  2019
Oil and gas
Oil production (barrels)                                            75,006                114,567               220,000
Average price per barrel                                            $69.00                $46.00                $61.00
Blended royalty rate                                                 13.9%                 11.7%                 13.2%
Natural gas production (millions of cubic feet)                     64,000                207,000               312,000
Average price per thousand cubic feet                                $1.50                 $1.06                 $1.58
Blended royalty rate                                                 13.9%                 11.7%                 13.2%

Water
Water sold in acre-feet                                             13,651                 5,022                 4,482
Average price per acre-feet                                         $1,137                $1,177                 $750

Cement
Tons sold                                                          1,275,000             1,253,000             1,117,000
Average price per ton                                                $1.73                 $1.77                 $1.71

Rock/Aggregate
Tons sold                                                          1,466,000             1,272,000             1,283,000
Average price per ton                                                $1.30                 $1.11                 $1.03

Note: Differences between the revenues calculated in this table and the revenues reported in the previous table are attributed to rounding and the level of detail presented on the production units shown.

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2021 operational highlights:

•Revenues from our mineral resources segment increased $10,251,000, or 95%, to
$20,987,000 in 2021 when compared to $10,736,000 in 2020. The increase is
attributed to a $9,614,000 increase in water sales driven by dry 2021 winter
conditions and low SWP allocations. Comparatively, the Company sold 13,651
acre-feet and 5,022 acre-feet in 2021 and 2020, respectively.

•Rock aggregate royalties increased as a result of higher demand and better
pricing, fueled by the continuing growth in infrastructure projects throughout
the state.

• Spending on mineral resources increased $7,145,000i.e. 111%, at $13,559,000 in 2021 compared to $6,414,000 in 2020 due to the increase in the volume of water sales.

2020 operational highlights:

•Revenues from our mineral resources segment increased $945,000, or 10%, to
$10,736,000 in 2020 when compared to $9,791,000 in 2019. The increase is
attributed to a $1,912,000 increase in water sales. During 2019, the Company had
an unfavorable water sales adjustment of $1,050,000 that was tied to an increase
in SWP allocation levels, which adversely affected sales pricing. In 2020
however, SWP allocation levels were much lower, which in turn improved pricing,
resulting in additional water sales revenues. Lastly, there were 540 additional
acre-feet of water sold during 2020 when compared to 2019.

• There has been an increase in royalties on cement from $306,000 resulting from increased demand from the Company’s tenant, National Cement, due to an increase in road infrastructure projects.

•  Offsetting the favorable revenue increases was a $1,188,000 decrease in oil
and gas royalties resulting from lower prices for much of 2020 and lower demand
driven by social distancing initiatives such as California's stay-at-home
orders.

•  Mineral resource expense increased $596,000, or 10%, to $6,414,000 in 2020
when compared to $5,818,000 in 2019. Of the $596,000 increase, $469,000 is
attributed to increased water cost of sales as a result of selling additional
water. The remainder is attributed to an increase in property taxes that
occurred because of higher mineral assessments on the Company's land.

For more details on mineral resource transactions, see Section 1 “Business – Mineral Resources”.

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Farming

             ($ in thousands)                       2021          2020          2019
             Farming revenues
             Almonds                             $  3,100      $  5,021      $  7,310
             Pistachios                             4,293         5,636         7,466
             Wine grapes                            2,850         2,589         3,740
             Hay                                      408           419           468
             Other                                    388           201           347
             Total farming revenues              $ 11,039      $ 13,866      $ 19,331
             Total farming expenses              $ 14,116      $ 15,103      $ 15,251
             Operating Income from farming       $ (3,077)     $ (1,237)     $  4,080


                                                 December 31, 2021                                                  December 31, 2020                                                       Change
                                                                            Average                                                            Average                                                          Average
($ in thousands)                 Revenue           Quantity Sold2            Price                  Revenue           Quantity Sold2            Price                  Revenue          Quantity Sold2           Price
ALMONDS (lbs.)
Current year crop              $   2,257                 945              $   2.39                $   4,207               2,078              $   2.02                $ (1,950)             (1,133)             $  0.37
Prior crop years                     670                 377              $   1.78                      783                 405              $   1.93                    (113)                (28)               (0.15)
Prior crop price
adjustment                             -                                                                  -                                                                 -
Signing bonus                          -                                                                 31                                                               (31)
Crop Insurance                       173                                                                  -                                                               173
Subtotal Almonds1              $   3,100               1,322              $   2.21                $   5,021               2,483              $   2.01                $ (1,921)             (1,161)             $  0.20
PISTACHIOS (lbs.)
Current year crop              $   3,462               1,615              $   2.14                $     932                 456              $   2.04                $  2,530               1,159              $  0.10
Prior crop years                       -                   -                     -                       25                  13                  1.92                     (25)                (13)               (1.92)
Prior crop price
adjustment                           365                                                                890                                                              (525)
Crop Insurance                       466                                                              3,789                                                            (3,323)
Subtotal Pistachios1           $   4,293               1,615              $   2.14                $   5,636                 469              $   2.04                $ (1,343)              1,146              $  0.10
WINE GRAPES (tons)
Current year crop              $   2,850                   9              $ 316.67                $   2,589                   9              $ 287.67                $    261                   -              $ 29.00

Crop Insurance                         -                                                                  -                                                                 -
Subtotal Wine Grapes           $   2,850                   9              $ 316.67                $   2,589                   9              $ 287.67                $    261                   -              $ 29.00
Other
Hay                            $     408                                                          $     419                                                          $    (11)
Other farming revenues               388                                                                201                                                               187
Total farming revenues         $  11,039                                                          $  13,866                                                          $ (2,827)

1 The calculation of the average price reflects the sale of the almond and pistachio harvests during the calendar year in question, excluding any price adjustment. 2 Units of almonds and pistachios are presented in thousands of pounds while wine grapes are presented in thousands of tons.

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2021 operational highlights:

• In 2021, revenues from the agricultural segment decreased $2,827,000or 20%, from
$13,866,000 in 2020 for $11,039,000 in 2021. The factors contributing to this decrease are as follows:

•Almond revenues decreased $1,921,000 due to supply chain disruptions that
impacted our ability to deliver 2021 almond crop. In particular, there is a
shortage of truck drivers needed to transport goods to the Los Angeles and Long
Beach ports so that goods can be shipped overseas. Additionally, there is a
shortage in food grade shipping containers that are necessary to ship almonds
overseas. Thus far, these disruptions have continued into 2022 but we expect to
sell the remainder of our 2021 crop in 2022.

•Pistachio revenues decreased $1,343,000 primarily due to the decrease in
insurance proceeds received in 2021 when compared to 2020. In 2020, we received
pistachio insurance proceeds of $3,789,000, but because the 2021 pistachio crop
year is a down bearing production year the insurance proceeds were only
$466,000, a decrease of $3,323,000. The primary driver leading to higher
insurance proceeds in 2020, was the assumption that 2020 production was based on
yields typically seen during an on production year, which is much higher than
that of the current down bearing production year. With respect to yields, the
Company sold 1,615,000 and 456,000 pounds of pistachios in 2021 and 2020,
respectively. The 2021 pistachio yields were inline with a normal off-production
year.

• Wine grape revenues increased $261,000 due to better wine grape pricing.

                                                December 31, 2020                                                  December 31, 2019                                                       Change
                                                                           Average                                                            Average                                                          Average
($ in thousands)                Revenue           Quantity Sold2            Price                  Revenue           Quantity Sold2            Price                  Revenue          Quantity Sold2           Price
ALMONDS (lbs.)
Current year crop             $   4,207               2,078              $   2.02                $   6,359               2,252              $   2.82                $ (2,152)               (174)             $ (0.80)
Prior crop years                    783                 405                  1.93                      568                 227              $   2.50                     215                 178                (0.57)
Prior crop price
adjustment                            -                                                                (61)                                                               61
Signing bonus                        31                                                                 28                                                                 3
Crop Insurance                        -                                                          $     416                                                          $   (416)
Subtotal Almonds1             $   5,021               2,483              $   2.01                $   7,310               2,479              $   2.79                $ (2,289)                  4              $ (0.78)
PISTACHIOS (lbs.)
Current year crop             $     932                 456              $   2.04                $   1,624                 819              $   1.98                $   (692)               (363)             $  0.06
Prior crop years                     25                  13                  1.92                      976                 558                  1.75                    (951)               (545)                0.17
Prior crop price
adjustment                          890                                                              3,807                                                            (2,917)
Insurance                         3,789                                                              1,059                                                             2,730
Subtotal Pistachios1          $   5,636                 469              $   2.04                $   7,466               1,377              $   1.89                $ (1,830)               (908)             $  0.15
WINE GRAPES (tons)
Current year crop             $   2,589                   9              $ 287.67                $   3,730                  14              $ 266.43                $ (1,141)                 (5)             $ 21.24
Insurance                             -                                                                 10                                                               (10)
Subtotal Wine Grapes          $   2,589                   9              $ 287.67                $   3,740                  14              $ 266.43                $ (1,151)                 (5)             $ 21.24
Other
Hay                           $     419                                                          $     468                                                          $    (49)
Other farming revenues              201                                                                347                                                              (146)
Total farming revenues        $  13,866                                                          $  19,331                                                          $ (5,465)

1 The calculation of the average price reflects the sale of the almond and pistachio harvests during the calendar year in question, excluding any price adjustment. 2 Units of almonds and pistachios are presented in thousands of pounds while wine grapes are presented in thousands of tons.

                                       46
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2020 operational highlights:

• In 2020, revenue from the agricultural segment decreased $5,465,000i.e. 28%, of
$19,331,000 in 2019 at $13,866,000 in 2020. The factors contributing to this decrease are as follows:

•Almond revenues decreased $2,289,000 as a result of lower pricing. California's
2020 almond crop yielded in excess of 3 billion pounds, surpassing all previous
production records. The increased yields were driven by favorable blooms along
with new almond plantings coming into production throughout California in recent
years. The mix of demand has been changed in the near term as a result of
COVID-19 as more product is moving through wholesale markets and less through
high end users such as restaurants. The global demand for almonds remains as
strong as it was prior to the pandemic, with India and China being the largest
importer of California almonds. Although COVID-19 disrupted international trade
during its early onset, it ultimately had a sparing effect on the Company's
sales volumes. The aforementioned factors discussed are the primary drivers of
the overall decline in pricing.

•Pistachio revenues decreased $1,830,000. Although 2020 was not a down bearing
year for pistachios, the crop did not receive adequate chilling hours as a
result of the warm 2020 winter. Crops with inadequate chilling hours will have
depressed yields and blooms. As a hedge against below average production for its
almond and pistachio crops, the Company purchases crop production insurance
annually. This insurance will pay for reduced production if crop production in
the year falls below the insured levels. The Company filed a claim with its
insurance provider in order to recuperate a portion of the reduced production
revenues as a result of lost production. The insurance claim in the amount of
$3,789,000 was collected during the fourth quarter.

•Wine grape revenues decreased $1,151,000 due to less production, which was the
result of removing a 313 acre vineyard. The vineyard was removed in 2020 as
there was no longer interest for its fruit. The Company in late 2020 acquired a
new sales contract for a different variety of grapes, resulting in the
development of a new vineyard, which will ultimately replace this lost revenue
stream.

For further details on farming operations, see Section 1 “Commercial Farming”.

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Ranch Operations

($ in thousands)                                                2021              2020              2019
Ranch operations revenue
Game management and other 1                                  $  2,744          $  2,097          $  2,020
Grazing                                                         1,367             1,595             1,589
Total ranch operations revenues                              $  4,111          $  3,692          $  3,609
Total ranch operations expenses                              $  4,679          $  4,896          $  5,316
Operating loss from ranch operations                         $   (568)         $ (1,204)         $ (1,707)
1 Game management and other revenues consist of revenues from hunting, filming, high desert hunt club (a
premier upland bird hunting club), and other ancillary activities.


2021 operational highlights:

•Revenues from ranch operations increased $419,000, or 11%, from $3,692,000 in
2020 to $4,111,000 in 2021, which is primarily attributed to an increase in
guided hunts of $123,000 and an increase in filming location fees of $292,000.
Due to extended mandates and restrictions from COVID-19 in Los Angeles County,
our vast open area was able to attract more production companies during 2021. As
restrictions in Los Angeles County continue into 2022, we expect to see the same
level of interest for filming on our land.

•Ranch operations expenses decreased $217,000, or 4%, to $4,679,000 in 2021 from
$4,896,000 in 2020. The decrease is primarily attributed to reduced payroll and
overhead expenses of $218,000.

2020 operational highlights:

• Income from ranch operations has increased $83,000or 2%, of $3,609,000 in 2019 at $3,692,000 in 2020, which is mainly attributable to an increase in guided hunts from $121,000.

•Ranch operations expenses decreased $420,000, or 8%, to $4,896,000 in 2020 from
$5,316,000 in 2019. The decrease is primarily attributed to reduced payroll and
overhead expenses of $332,000 as a result of the Company's right sizing efforts.
This segment also had notable decreases in fuel costs and fees of $56,000 and
$60,000, respectively.

Other Income

Total other income decreased $2,104,000, or 90%, from $2,325,000 in 2020 to
$221,000 in 2021. In 2020, the Company sold building and land that was
previously operated by a fast food tenant to its joint venture, Petro Travel
Plaza LLC. The Company received a cash distribution of $2,000,000 from the joint
venture, and realized a Gain on Sale of Real Estate of $1,331,000. In addition,
investment interest income decreased $489,000 as a result of having less
marketable securities invested throughout the year.

Total other income increased $2,910,000, or 497%, from a loss of $585,000 in
2019 to income of $2,325,000 in 2020. In 2019, the Company recognized asset
abandonment costs of $1,604,000, that was primarily related to a wine grape
vineyard consisting of 313 acres. There were no similar abandonment costs
recorded in 2020. Also in 2020, the Company sold building and land that was
previously operated by a fast food tenant to its joint venture, Petro Travel
Plaza LLC. The Company received a cash distribution of $2,000,000 from the joint
venture, and realized a Gain on Sale of Real Estate of $1,331,000. Offsetting
these favorable variances in other income was a $355,000 decrease in investment
income that resulted from not reinvesting maturing securities in order to fund
the Company's major development projects.

Corporate expenses

Corporate general and administrative costs increased $413,000, or 4.4%, to
$9,843,000 during 2021 when compared to $9,430,000 in 2020. The increase is
attributed to a $255,000 increase in insurance expense and a $128,000 increase
in director expenses associated with the expansion of the Board of Directors to
fulfill California state requirements on gender and underrepresented community
requirements.

Corporate general and administrative costs increased $69,000, or 0.7%, to
$9,430,000 during 2020 when compared to $9,361,000 in 2019. The increase is
attributed to an $1,182,000 increase in stock compensation as a result of
implementing a new performance stock compensation plan. This increase was offset
by a $546,000 decrease in payroll as a result of temporary cost cutting measures
resulting from the COVID-19 pandemic, a $426,000 decrease in professional
services, and a $139,000 decrease in depreciation.
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Equity in Earnings of Unconsolidated Joint Ventures
Equity in earnings of unconsolidated joint ventures is an important and growing
component of our commercial/industrial activities and in the future, equity in
earnings of unconsolidated joint ventures can become a significant part of our
operations within the resort/residential segment. We continue to use joint
ventures to advance our development projects at TRCC. This allows us to combine
our resources with other real estate companies and gain greater access to
capital, share in the risks of real estate developments, and share in the
operating expenses. More importantly, it allows us to better manage the
deployment of our capital and increase our leasing portfolio.

($ in thousands)                                              2021         2020          2019
Equity in earnings (loss)
Petro Travel Plaza Holdings LLC                             $ 4,957      $ 5,722      $  8,810
Five West Parcel, LLC                                             -           (2)        9,119
18-19 West, LLC                                               5,206          (68)          (53)
TRCC/Rock Outlet Center, LLC                                 (1,443)      (2,090)       (1,921)
TRC-MRC 1, LLC                                                   (7)          64            46
TRC-MRC 2, LLC                                                  634          678           575
TRC-MRC 3, LLC                                                 (144)         200            (1)
TRC-MRC 4, LLC                                                   (1)           -             -

Equity to results of unconsolidated joint ventures, net $9,202 $4,504 $16,575


2021 Operational Highlights:

In 2021, equity in profit of unconsolidated joint ventures increased
$4,698,000i.e. 104%, at $9,202,000 when compared to $4,504,000 in 2020.

•The 18-19 West LLC joint venture had a purchase option in place with a
third-party to purchase lots l8 and 19 at a price of $15,213,000. In November
2021, the third-party exercised the land option and purchased the land from the
joint venture for $15,213,000.

•The Petro Travel Plaza improved its fuel sales volume by 22% in 2021 when
compared to 2020. However, the Company's share of operating results declined as
a result of a 96% increase in the overall cost of fuel that was only partially
mitigated by a 70% increase in fuel sales prices. Additionally, the joint
venture also experienced an increase in labor costs due to increasing market
wages.

2020 Operational Highlights:

During 2020, equity in earnings of unconsolidated joint ventures decreased
$12,071,000i.e. 73%, at $4,504,000 when compared to $16,575,000 in 2019.

•Five West Parcel, LLC's operating results declined $9,121,000 when compared to
2019 because the joint venture in 2020 was focused on dissolution, which was
completed in 2020. In 2019, the joint venture sold its building and land for
$29,088,000, and recognized a gain of $17,537,000. The Company was entitled to
50% of the gain in 2019, explaining the year-over-year variance.

•There was a $3,088,000 decrease in our share of earnings from our TA/Petro
joint venture. This joint venture was impacted by California's stay-at home
orders for most of 2020. As travelers were discouraged from travelling during
the holidays, fuel sales volumes saw a 10% decline, causing a 22% decline in
fuel margins. In addition, indoor dining restrictions forced the joint venture's
full service restaurants to close which resulted in a 77% decline in revenues
and a 78% decline in restaurant operating margins.
                                       49
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Income taxes

For the twelve months ended December 31, 2021, the Company's net income tax
expense was $3,821,000 compared to $829,000 for the twelve months ended
December 31, 2020. These represent effective income tax rates of approximately
42% and 1,011% for the twelve months ended December 31, 2021 and, 2020,
respectively. Our effective income tax rate for the year ended December 31, 2021
was higher than the federal statutory rate in the United States, a result of
permanent differences arising from stock compensation and non-deductible
compensation under Section 162(m) of the Tax Cuts and Jobs Act of 2017. The
discrete item associated with stock grants was triggered when stock grants were
issued to participants at a price less than the original grant price, causing a
deferred tax shortfall. The shortfall recognized during the year represents the
reversal of excess deferred tax assets recognized in prior periods. The
recognition of the shortfall is not anticipated to have an impact on the
Company's current income tax payable. Lastly, the Company recorded a one time
deferred tax liability true-up associated with capitalized stock compensation.
As of December 31, 2021 and 2020 we had an income tax payable of $1,217,000 and
income tax receivable of $1,497,000, respectively.

As of December 31, 2021, we had net deferred tax liabilities of $2,898,000. Our
largest deferred tax assets were made up of temporary differences related to the
capitalization of costs, pension adjustments, interest rate swap, and stock
compensation. Deferred tax liabilities consist of depreciation, deferred gains,
joint venture differences, cost of sales adjustments, and straight-line rent.
Due to the nature of most of our deferred tax assets, we believe they will be
used in future years and an allowance is not necessary.

The Company classifies interest and penalties incurred on tax payments as income
tax expenses. The Company made income tax payments of $730,000 in 2021 and 0 in
2020. The Company received refunds of $483,000 in 2021 and $1,314,000 in 2020.

For further details, see Note 12. (Income Taxes) of the Notes to the Consolidated Financial Statements, included with this Annual Report on Form 10-K.

Cash and capital resources

Cash flow and liquidity

Our financial position allows us to pursue our strategies of continued
development of TRCC, funding of operating activities, land entitlement,
development, and conservation. Accordingly, we have established well-defined
priorities for our available cash, including investing in core operating
segments to achieve profitable future growth. We have historically funded our
operations with cash flows from operating activities, investment proceeds, and
short-term borrowings from our bank credit facilities. In the past, we have also
issued common stock and used the proceeds for capital investment activities.

To enhance shareholder value, we will continue to make investments in our real
estate segments to secure land entitlement approvals, build infrastructure for
our developments, invest in to be leased assets, ensure adequate future water
supplies, and provide funds for general land development activities. Within our
farming segment, we will make investments as needed to improve efficiency and
add capacity to its operations when it is profitable to do so.

Our cash and cash equivalents and marketable securities totaled approximately
$47,178,000 at December 31, 2021, a decrease of $10,913,000, or 19%, from the
corresponding amount at the end of 2020.

The following table summarizes the cash flow activities for the following years
ended December 31:

($ in thousands)             2021           2020          2019
Operating activities      $   2,816      $ 15,481      $ 16,045
Investing activities      $ (14,652)     $ 19,778      $    828
Financing activities      $  (6,086)     $ (7,045)     $ (5,675)



Cash flows provided by operating activities are primarily dependent upon the
rental rates of our leases, the collectability of rent and recovery of operating
expenses from our tenants, distributions from joint ventures, the success of our
crops and commodity prices within our mineral resource segment.

In 2021, our operations generated $2,816,000 in cash, primarily through joint venture distributions.

During 2020, our operations generated $15,481,000 in cash. A portion of these
receipts came from distributions of $6,222,000 from our Five West Parcel,
TA/Petro and Majestic joint ventures, while another $5,427,000 came in the form
of farming receivable collections.
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During 2021, investing activities used $14,652,000, which was largely attributed
to capital expenditures of $20,879,000 used primarily for real estate
development. Of the $20,879,000, we spent $4,004,000 on general planning and
final map preparation for Phase 1 of MV, $2,939,000 on litigation defense for
Centennial, and $1,121,000 on litigation for Grapevine. At TRCC, we primarily
used $4,906,000 to expand water infrastructure at TRCC and early entitlement
efforts for TRCC Residential. All real estate capital expenditures are inclusive
of capitalized interest, payroll and overhead. Our mineral resources segment
spent $2,415,000 to acquire water for use as needed and for future residential
development activity. Lastly, our farming segment had cash outlays of $7,416,000
for cultural and water costs tied to crops not yet in production, developing new
almond orchards, grape vineyards, and replacing old farm equipment. The Company
also reinvested $14,586,000 into marketable securities. Offsetting cash outlays
were maturities on marketable securities of $6,249,000, proceeds from water
sales of $9,534,000, distributions from unconsolidated joint ventures of
$5,734,000, and net proceeds from land sales of $4,413,000.

During 2020, investing activities provided $19,778,000, which was largely
attributed to marketable securities maturities of $41,843,000. The maturities
were used to fund capital expenditures of $22,259,000 that was primarily related
to our real estate development. Of the $22,259,000, we spent $4,132,000 on
general planning and final map preparation for Phase 1 of MV, $3,635,000 on
litigation defense for Centennial, and $1,997,000 on re-entitlement and
litigation for Grapevine. At TRCC, we primarily used $7,128,000 to expand water
infrastructure at TRCC and early entitlement efforts for TRCC Residential. All
real estate capital expenditures are inclusive of capitalized interest, payroll
and overhead. Our mineral resources segment spent $3,568,000 to acquire water
for use as needed and for our future residential developments. Lastly, our
farming segment had cash outlays of $5,145,000 for developing new almond
orchards and replacing old farm equipment.

Our estimated capital investment for 2022 is primarily related to our real
estate projects as it was in 2021. These estimated investments include
approximately $12,716,000 of infrastructure development at TRCC-East to support
continued commercial retail and industrial development and expanding water
facilities to support future anticipated absorption. We are also investing
approximately $3,337,000 to continue developing new almond orchards, wine grape
vineyards, and replacing old farming equipment. The farm investments are part of
a long-term farm management program to redevelop declining orchards and
vineyards allowing the Company to maintain and improve future farm revenues. We
expect to possibly invest up to $8,513,000 for permitting activities, litigation
defense, predevelopment activities and land planning design at MV, Centennial,
and Grapevine. The timing of these investments is dependent on our coordination
efforts with Los Angeles County regarding litigation efforts for Centennial,
permitting activities for Grapevine, and design, civil engineering, land
planning and design, for MV. Our plans also include $4,544,000 for payment of
annual water inventory and water related investments. We are also planning to
potentially invest up to $502,000 in the normal replacement of operating
equipment, such as ranch equipment, and vehicles.

We capitalize interest cost as a cost of the project only during the period for
which activities necessary to prepare an asset for its intended use are ongoing,
provided that expenditures for the asset have been made and interest cost has
been incurred. Capitalized interest for the years ended December 31, 2021 and
2020, of $2,459,000 and $2,713,000, respectively, is classified in real estate
development. We also capitalized payroll costs related to development,
pre-construction, and construction projects which aggregated $2,467,000 and
$3,520,000 for the years ended December 31, 2021 and 2020, respectively.
Expenditures for repairs and maintenance are expensed as incurred. As noted
above, these costs are included in the above investment numbers.

In 2021, financing activities used $6,086,000which includes repayments of the long-term debt of $4,295,000 and tax payments on vested stock awards of $1,791,000.

In 2020, fundraising activities used $7,045,000which includes repayments of the long-term debt of $4,819,000 and tax payments on vested stock awards of $2,226,000.

It is difficult to accurately predict cash flows due to the nature of our
businesses and fluctuating economic conditions. Our earnings and cash flows will
be affected from period to period by the commodity nature of our farming and
mineral operations, the timing of sales and leases of property within our
development projects, and the beginning of development within our residential
projects. The timing of sales and leases within our development projects is
difficult to predict due to the time necessary to complete the development
process and negotiate sales or lease contracts. Often, the timing aspect of land
development can lead to particular years or periods having more or less earnings
than comparable periods. Based on our experience, we believe we will have
adequate cash flows, cash balances, and availability on our line of credit over
the next twelve months to fund internal operations. As we move forward with the
completion of the litigation, permitting and engineering design for our master
planned communities and prepare to move into the development stage, we will need
to secure additional funding through the issuance of equity and secure other
forms of financing such as joint ventures and possibly debt and equity
financing.
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Capital structure and financial situation

AT December 31, 2021total capitalization at book value was $509,141,000
made up of $52,630,000 debt, net of deferred financing costs, and
$456,511,000 equity, resulting in a debt-to-total capitalization ratio of approximately 10.3%, which represents a decrease from the debt-to-total capitalization ratio of 13.1% at December 31, 2020.

In 2014, the Company as borrower, entered into an Amended and Restated Credit
Agreement, a Term Note and a Revolving Line of Credit Note, with Wells Fargo, or
collectively the Credit Facility. The Credit Facility added a $70,000,000 term
loan, or Term Loan, to the then existing $30,000,000 revolving line of credit,
or RLC. In 2019, the Company amended the Term Note (Amended Term Note) and
extended its maturity to June 2029 and amended the RLC to expand
the capacity from $30,000,000 to $35,000,000 and extend the maturity to October
2024.

The Amended Term Loan had an outstanding balance of $50,837,000 as of
December 31, 2021 and an outstanding balance of $54,887,000 as of December 31,
2020. The interest rate per annum applicable to the Amended Term Note is LIBOR
(as defined in the Term Note) plus a margin of 170 basis points. The interest
rate for the Amended Term Note has been fixed at 4.16% through the use of an
interest rate swap agreement. The Amended Term Note requires monthly
amortization payments, with the outstanding principal amount due June 5, 2029.
The Amended Term Note is secured by the Company's farmland and farm assets,
which include equipment, crops and crop receivables; the PEF power plant lease
and lease site; and related accounts and other rights to payment and inventory.

The RLC had no outstanding balance at December 31, 2021 and December 31, 2020.
At the Company's option, the interest rate on this line of credit can float at
1.50% over a selected LIBOR rate or can be fixed at 1.50% above LIBOR for a
fixed rate term. During the term of this RLC, the Company can borrow at any time
and partially or wholly repay any outstanding borrowings and then re-borrow, as
necessary.

Any future borrowings under the RLC will be used for ongoing working capital
requirements and other general corporate purposes. To maintain availability of
funds under the RLC, undrawn amounts under the RLC will accrue a commitment fee
of 10 basis points per annum. The Company's ability to borrow additional funds
in the future under the RLC is subject to compliance with certain financial
covenants and making certain representations and warranties, which are typical
in this type of borrowing arrangement.

The Amended Note and RLC, collectively the Amended Credit Facility, requires
compliance with three financial covenants: (i) total liabilities divided by
tangible net worth not greater than 0.75 to 1.0 at each quarter end; (ii) a debt
service coverage ratio not less than 1.25 to 1.00 as of each quarter end on a
rolling four quarter basis; and (iii) maintain liquid assets equal to or greater
than $20,000,000, including availability on the RLC. At December 31, 2021 and
December 31, 2020, the Company was in compliance with all financial covenants.

The Amended Credit Facility also contains customary negative covenants that
limit the ability of the Company to, among other things, make capital
expenditures, incur indebtedness and issue guaranties, consummate certain assets
sales, acquisitions or mergers, make investments, pay dividends or repurchase
stock, or incur liens on any assets.

The Amended Credit Facility contains customary events of default, including:
failure to make required payments; failure to comply with terms of the Amended
Credit Facility; bankruptcy and insolvency; and a change in control without
consent of the bank (which consent will not be unreasonably withheld). The
Amended Credit Facility contains other customary terms and conditions, including
representations and warranties, which are typical for credit facilities of this
type.

We also have a $4,750,000 promissory note agreement with principal and interest
due monthly. The interest rate on this promissory note is 4.25% per annum, with
principal and interest payments ending on September 1, 2028. The proceeds from
this promissory note were used to eliminate debt that had been previously used
to provide long-term financing for a building being leased to Starbucks and
provide additional working capital for future investment. In March 2020, the
Company made an additional payment of $687,000 that was applied to the principal
of the note. Subsequent principal and interest payments were reduced to $28,000
per month. The additional principal payment was tied to the release of
collateral, which in April 2020 was contributed to Petro Travel Plaza LLC. The
balance of this long-term debt instrument included in "Notes payable" above
approximates the fair value of the instrument. The balance as of December 31,
2021 is $1,947,000.

Our current and future capital resource requirements will be provided primarily
from current cash and marketable securities, cash flow from on-going operations,
distributions from joint ventures, proceeds from the sale of developed and
undeveloped parcels, potential sales of assets, additional use of debt or
drawdowns against our line-of-credit, proceeds from the reimbursement of public
infrastructure costs through CFD bond debt (described below under "Off-Balance
Sheet Arrangements"), and the issuance of common stock. In May 2019, we filed an
updated shelf registration statement on Form S-3 that went effective in May
2019. Under the shelf registration statement, we may offer and sell in the
future one or more
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offerings, common stock, preferred stock, debt securities, warrants or any
combination of the foregoing. The shelf registration allows for efficient and
timely access to capital markets and when combined with our other potential
funding sources just noted, provides us with a variety of capital funding
options that can then be used and appropriately matched to the funding needs of
the Company.

As noted above, at December 31, 2021, we had $47,178,000 in cash and securities
and as of the filing date of this Form 10-K, we had $35,000,000 available on
credit lines to meet any short-term liquidity needs.

We continue to expect that substantial investments will be required in order to
develop our land assets. In order to meet these capital requirements, we may
need to secure additional debt financing and continue to renew our existing
credit facilities. In addition to debt financing, we will use other capital
alternatives such as joint ventures with financial partners, sales of assets,
and the issuance of common stock. We will use a combination of the above funding
sources to properly match funding requirements with the assets or development
project being funded. As we move into 2022, we will be evaluating various
options for funding the potential start of development projects. There is no
assurance that we can obtain financing or that we can obtain financing at
favorable terms. We believe we have adequate capital resources to fund our cash
needs and our capital investment requirements in the near-term as described
earlier in the cash flow and liquidity discussions.

Cash contractual obligations

The following table summarizes our contractual cash obligations and commercial commitments as of December 31, 2021to be paid over the next five years:

                                                                           Payments Due by Period
                                                             Less than a                                               More than 5
($ in thousands)                             Total               year            1-3 years          3-5 years             years
Contractual Obligations:
Estimated water payments                  $ 285,566          $  11,452          $  23,945          $  25,404          $  224,765
Long-term debt                               52,784              4,475              9,596             10,454              28,259
Interest on long-term debt                   10,624              2,098              3,613              2,778               2,135

Cash contract commitments                     9,429              6,184              1,656                518               1,071
Defined Benefit Plan                          4,647                317                712                973               2,645
SERP                                          5,230                526                997              1,115               2,592

Financing fees                                  163                163                  -                  -                   -
Operating lease                                  27                 16                 11                  -                   -
Total contractual obligations             $ 368,470          $  25,231      

$40,530 $41,242 $261,467

The table above only includes contracts that include fixed or minimum obligations. It does not include normal purchases, which are made in the normal course of business.

As discussed in Note 15 (Retirement Plans) of the Notes to Consolidated
Financial Statements, we have long-term liabilities for deferred employee
compensation, including pension and supplemental retirement plans. Payments in
the above table reflect estimates of future defined benefit plan contributions
from the Company to the plan trust, estimates of payments to employees from the
plan trust, and estimates of future payments to employees from the Company that
are in the SERP program. During 2021, we made pension contributions of $165,000
and it is projected that we will make a similar contribution in 2022.

Our cash contract commitments consist of contracts in various stages of
completion related to infrastructure development within our industrial
developments and entitlement costs related to our industrial and residential
development projects. Also, included in the cash contract commitments are
estimated fees earned in 2014 by a consultant, related to the entitlement of the
Grapevine Development Area. The Company exited a consulting contract in 2014
related to the Grapevine Development and is obligated to pay an earned incentive
fee at the time of successful receipt of litigated project entitlements and at a
value measurement date five-years after entitlements have been achieved for
Grapevine. The final amount of the incentive fees will not be finalized until
the future payment dates. The Company believes that net savings from exiting the
contract over this future time period will more than offset the incentive
payment costs.

Estimated water payments include the Nickel water contract, which obligates us
to purchase 6,693 acre-feet of water annually through 2044 and SWP contracts
with Wheeler Ridge Maricopa Water Storage District, Tejon-Castac Water District,
Tulare Lake Basin Water Storage District, and Dudley-Ridge Water Storage
District. These contracts for the supply of future water run through 2035.
Please refer to Note 6 (Long-Term Water Assets) of the Notes to Consolidated
Financial Statements for additional information regarding water assets.
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Off-balance sheet arrangements

The following table sets out the potential obligations we have in relation to CFDs.

                                                                           Amount of Commitment Expiration Per Period
($ in thousands)                                   Total               < 1 year           2 -3 Years           4 -5 Years           After 5 Years
Other Commercial Commitments:
Standby letter of credit                      $       4,393          $   4,393          $         -          $         -          $            -
Total other commercial commitments            $       4,393          $   4,393          $         -          $         -          $            -


The Tejon Ranch Public Facilities Financing Authority, or TRPFFA, is a joint
powers authority formed by Kern County and TCWD to finance public infrastructure
within the Company's Kern County developments. TRPFFA created two CFD's, the
West CFD and the East CFD. The West CFD has placed liens on 420 acres of the
Company's land to secure payment of special taxes related to $28,620,000 of bond
debt sold by TRPFFA for TRCC-West. The East CFD has placed liens on 1,931 acres
of the Company's land to secure payments of special taxes related to $75,965,000
of bond debt sold by TRPFFA for TRCC-East. At TRCC-West, the West CFD has no
additional bond debt approved for issuance. At TRCC-East, the East CFD has
approximately $44,035,000 of additional bond debt authorized by TRPFFA.

In connection with the sale of bonds there is a standby letter of credit for
$4,393,000 related to the issuance of East CFD bonds. The standby letter of
credit is in place to provide additional credit enhancement and cover
approximately two years' worth of interest on the outstanding bonds. This letter
of credit will not be drawn upon unless the Company, as the largest landowner in
the CFD, fails to make its property tax payments. As development occurs within
TRCC-East there is a mechanism in the bond documents to reduce the amount of the
letter of credit. The Company believes that the letter of credit will never be
drawn upon. This letter of credit is for a two-year period of time and will be
renewed in two-year intervals as necessary. The annual cost related to the
letter of credit is approximately $68,000. The assessment of each individual
property sold or leased within each CFD is not determinable at this time because
it is based on the current tax rate and the assessed value of the property at
the time of sale or on its assessed value at the time it is leased to a
third-party. Accordingly, the Company is not required to recognize an obligation
at December 31, 2021.

At December 31, 2021, aggregate outstanding debt of unconsolidated joint
ventures was $141,917,000. We guarantee $127,069,000 of this debt, relating to
our joint ventures with Rockefeller and Majestic. Because of positive cash flow
generation within the Rockefeller and Majestic joint ventures, we do not expect
the guarantee to ever be called upon. We do not provide a guarantee on the
$14,848,000 of debt related to our joint venture with TA/Petro.
                                       54
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Non-GAAP Financial Measures

EBITDA represents earnings before interest, taxes, depreciation, and
amortization, a non-GAAP financial measure, and is used by us and others as a
supplemental measure of performance. We use Adjusted EBITDA to assess the
performance of our core operations, for financial and operational decision
making, and as a supplemental or additional means of evaluating period-to-period
comparisons on a consistent basis. Adjusted EBITDA is calculated as EBITDA,
excluding stock compensation expense and asset abandonment charges. We believe
Adjusted EBITDA provides investors relevant and useful information because it
permits investors to view income from our operations on an unleveraged basis
before the effects of taxes, depreciation and amortization, stock compensation
expense, and abandonment charges. By excluding interest expense and income,
EBITDA and Adjusted EBITDA allow investors to measure our performance
independent of our capital structure and indebtedness and, therefore, allow for
a more meaningful comparison of our performance to that of other companies, both
in the real estate industry and in other industries. We believe that excluding
charges related to share-based compensation facilitates a comparison of our
operations across periods and among other companies without the variances caused
by different valuation methodologies, the volatility of the expense (which
depends on market forces outside our control), and the assumptions and the
variety of award types that a company can use. EBITDA and Adjusted EBITDA have
limitations as measures of our performance. EBITDA and Adjusted EBITDA do not
reflect our historical cash expenditures or future cash requirements for capital
expenditures or contractual commitments. While EBITDA and Adjusted EBITDA are
relevant and widely used measures of performance, they do not represent net
income or cash flows from operations as defined by GAAP. Further, our
computation of EBITDA and Adjusted EBITDA may not be comparable to similar
measures reported by other companies.

                                                                         Year-Ended December 31,
($ in thousands)                                                2021              2020              2019
Net (loss) income                                            $  5,342          $   (747)         $ 10,579
Net loss attributed to non-controlling interest                    (6)               (7)               (1)
Interest, net
Consolidated interest income                                      (57)             (884)           (1,239)
Our share of interest expense from unconsolidated joint
ventures                                                        1,708             1,902             2,785
Total interest, net                                             1,651             1,018             1,546
Income tax expense                                              3,821               829             3,980
Depreciation and amortization
Consolidated                                                    4,594             4,938             5,036
Our share of depreciation and amortization from
unconsolidated joint ventures                                   4,639             4,419             4,135
Total depreciation and amortization                             9,233             9,357             9,171
EBITDA                                                         20,053            10,464            25,277
Stock compensation expense                                      4,271             4,494             3,198
Asset abandonment charges                                           -                 -             1,604
Adjusted EBITDA                                              $ 24,324          $ 14,958          $ 30,079


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Net operating income (NOI) is a non-GAAP financial measure calculated as
operating income, the most directly comparable financial measure calculated and
presented in accordance with GAAP, excluding general and administrative
expenses, interest expense, depreciation and amortization, and gain or loss on
sales of real estate. We believe NOI provides useful information to investors
regarding our financial condition and results of operations because it primarily
reflects those income and expense items that are incurred at the property level.
Therefore, we believe NOI is a useful measure for evaluating the operating
performance of our real estate assets.

($ in thousands)                                          Year-Ended December 31,
Net operating income                                  2021          2020         2019
Pastoria Energy Facility                           $   4,355      $ 4,576      $ 4,573
TRCC                                                   1,250        1,290        1,488
Communication leases                                     940          911          912
Other commercial leases                                  609          557          650

Total Commercial/Industrial Net Operating Profit $7,154 $7,334

   $ 7,623


                                                                       Year-Ended December 31,
($ in thousands)                                           2021                  2020                 2019
Commercial/Industrial operating income                $      7,523          $     2,414          $     3,831
Plus: Commercial/Industrial depreciation and
amortization                                                   463                  486                  517
Plus: General, administrative and other expenses            10,950                6,137               11,907
Less: Other revenues including land sales                  (11,782)              (1,703)              (8,632)

Total Commercial/Industrial Net Operating Profit $7,154 $7,334 $7,623


The Company utilizes NOI of unconsolidated joint ventures as a measure of
financial or operating performance that is not specifically defined by GAAP. We
believe NOI of unconsolidated joint ventures provides investors with additional
information concerning operating performance of our unconsolidated joint
ventures. We also use this measure internally to monitor the operating
performance of our unconsolidated joint ventures. Our computation of this
non-GAAP measure may not be the same as similar measures reported by other
companies. This non-GAAP financial measure should not be considered as an
alternative to net income as a measure of the operating performance of our
unconsolidated joint ventures or to cash flows computed in accordance with GAAP
as a measure of liquidity nor are they indicative of cash flows from operating
and financial activities of our unconsolidated joint ventures.

The following table reconciles the net income of unconsolidated joint ventures with the net income of unconsolidated joint ventures.

                                                                   Year-Ended December 31,
($ in thousands)                                        2021                2020                2019

Net income from unconsolidated joint ventures $16,752 $

  7,099          $   30,213
Plus: Interest expense of unconsolidated joint
ventures                                                 4,926               5,154               5,438
Operating income of unconsolidated joint ventures       21,678              12,253              35,651
Plus: Depreciation and amortization of
unconsolidated joint ventures                            8,720               8,323               7,773
Less: Gain on sale of asset                                  -                   -             (17,537)
Less: Profit from sale of land                         (10,380)                  -                   -
Net operating income of unconsolidated joint
ventures                                            $   20,018          $   20,576          $   25,887


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SECTION 7A. QUANTITATIVE AND QUALITATIVE INFORMATION ON MARKET RISK

Market risk represents the risk of loss that may impact the financial position,
results of operations, or cash flows of the Company due to adverse changes in
financial or commodity market prices or rates. We are exposed to market risk in
the areas of interest rates and commodity prices.

Financial market risks

Our exposure to financial market risks includes changes to interest rates and
credit risks related to marketable securities, interest rates related to our
outstanding indebtedness and trade receivables.

The primary objective of our investment activities is to preserve principal
while at the same time maximizing yields and prudently managing risk. To achieve
this objective and limit interest rate exposure, we limit our investments to
securities with a maturity of less than five years and an investment grade
rating from Moody's or Standard and Poor's. See Note 3 (Marketable Securities)
of the Notes to Consolidated Financial Statements.

Our current RLC has no outstanding balance. The interest rate on the RLC can
either float at 1.50% over a selected LIBOR rate or can be fixed at 1.50% above
LIBOR for a fixed term for a limited period of time and change only at maturity
of the fixed rate portion. The floating rate and fixed rate options within our
RLC help us manage our interest rate exposure on any outstanding balances.

We are exposed to interest rate risk on our long-term debt. Long-term debt
consists of two term loans, one for $50,837,000 and is tied to LIBOR plus a
margin of 1.70%. The interest rate for the term of this loan has been fixed
through the use of an interest rate swap that fixed the rate at 4.16%. The
outstanding balance on the second term loan is $1,947,000 and has a fixed rate
of 4.25%. We believe it is prudent at times to limit the variability of
floating-rate interest payments and have from time-to-time entered into interest
rate swap arrangements to manage those fluctuations, as we did with the Term
Loan.

Market risk related to our farming inventories ultimately depends on the value
of almonds, grapes, and pistachios at the time of payment or sale. Credit risk
related to our receivables depends upon the financial condition of our
customers. Based on historical experience with our current customers and
periodic credit evaluations of our customers' financial conditions, we believe
our credit risk is minimal. Market risk related to our farming inventories is
discussed below in the section pertaining to commodity price exposure.
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The following tables provide information about our financial instruments that are sensitive to changes in interest rates. The tables present our debt and marketable securities and their associated weighted average interest rates by expected maturity dates.

                Interest Rate Sensitivity Financial Market Risks
                     Principal Amount by Expected Maturity
                              At December 31, 2021
                     (In thousands except percentage data)

                                  2022              2023              2024              2025               2026             Thereafter             Total             Fair Value
Assets:
Marketable securities            $9,834             $756               $-                $-                 $-                  $-                $10,590              $10,983
Weighted average interest rate    0.20%             0.22%              -%                -%                 -%                  -%                 0.20%
Liabilities:

Long-term debt ($4.75M note)      $254              $265              $277              $289               $302                $560                $1,947              $1,947
Weighted average interest rate    4.25%             4.25%             4.25%             4.25%             4.25%                4.25%               4.25%
Long-term debt ($70.0M note)     $4,221            $4,429            $4,624            $4,825             $5,038              $27,700             $50,837              $50,837
Weighted average interest rate    4.16%             4.16%             4.16%             4.16%             4.16%                4.16%               4.16%



                Interest Rate Sensitivity Financial Market Risks
                     Principal Amount by Expected Maturity
                              At December 31, 2020
                     (In thousands except percentage data)

                                  2021               2022              2023              2024              2025             Thereafter             Total             Fair Value
Assets:
Marketable securities            $2,766               $-                $-                $-                $-                  $-                 $2,766              $2,771
Weighted average interest rate    0.99%               -%                -%                -%                -%                  -%                 0.99%
Liabilities:

Long-term debt ($4.75M note)      $244               $254              $265              $277              $289                $862                $2,191              $2,191
Weighted average interest rate    4.25%             4.25%              4.25%             4.25%             4.25%               4.25%               4.25%
Long-term debt ($70.0M note)     $4,051             $4,221            $4,429            $4,624            $4,825              $32,737             $54,887              $54,887
Weighted average interest rate    4.16%             4.16%              4.16%             4.16%             4.16%               4.16%               

4.16%


Our risk with regard to fluctuations in interest rates has decreased slightly
related to marketable securities since these balances have decreased compared to
the prior year.

Commodity Price Exposure

As of December 31, 2021, we have exposure to adverse price fluctuations
associated with certain inventories and accounts receivable. Farming inventories
consist of farming cultural and processing costs related to 2021 and 2020 crop
production. The farming costs inventoried are recorded at actual costs incurred.
Historically, these costs have been recovered each year when that year's crop
harvest has been sold.

With respect to accounts receivable, the amount at risk relates primarily to
farm crops. These receivables are recorded based on estimated final pricing. The
final price is generally not known for several months following the close of our
fiscal year. Of the $6,473,000 in outstanding accounts receivable at
December 31, 2021, $2,409,000 or 37%, is at risk for changing prices, all of
which is attributed to pistachios.
                                       58

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The price estimated for recording accounts receivable for pistachios recorded at
December 31, 2021 was $2.14 per pound, as compared to $2.04 per pound at
December 31, 2020. For each $0.01 change in the price per pound of pistachios,
our receivable for pistachios increases or decreases by $11,200. Although the
final price per pound of pistachios (and therefore the extent of the risk) is
not presently known, over the last three years prices have ranged from $1.98 to
$2.14.

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