Maui Land & Pineapple Co Inc 10-K for FY2024
Maui Land & Pineapple Co Inc (MLP)
About this 10-K
Maui Land & Pineapple Co Inc filed this 10-K on March 31, 2025, covering the fiscal year ended December 31, 2024 (FY2024).
Headline figures
Fiscal year ended December 31, 2024, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $11.57M
- up 24.5% from $9.29M a year earlier
- Net loss
- $7.39M
- compared with a net loss of $3.08M a year earlier
- Diluted EPS
- -$0.38
- compared with -$0.15 a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
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MAUI LAND & PINEAPPLE COMPANY, INC. (Exact name of registrant as specified in its charter) |
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Securities registered pursuant to Section 12(b) of the Act:
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Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or emerging growth company. See the definitions of “large accelerated filer,” accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer ☐ | Accelerated filer ☐ Smaller reporting company Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate by check mark whether the registrant is a shell Company (as defined in Rule 12b-2 of the Exchange Act). Yes
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| DOCUMENTS INCORPORATED BY REFERENCE Portions of registrant’s definitive Proxy Statement on Schedule 14A relating to the registrant’s 2025 Annual Meeting of Stockholders, to be filed with the Securities and Exchange Commission pursuant to Regulation 14A not later than 120 days after the end of the fiscal year covered by this Form 10-K, are incorporated by reference in Part III, Items 10-14 of this Form 10-K. | |
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Annual Report on Form 10-K for the year ended December 31, 2024 (this “Annual Report”), filed by Maui Land & Pineapple Company, Inc. with the Securities and Exchange Commission (“SEC”), contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which statements are subject to considerable risks and uncertainties. Forward-looking statements include all statements that are not statements of historical fact contained in this Annual Report and can be identified by words such as “anticipate,” “believe,” “continue” or “could,” “estimate,” “expect,” “intend,” “may,” “might,” “project,” “pursue,” “will,” or “would,” or the negative or other variations thereof or comparable terminology. In particular, forward-looking statements contained in this Annual Report relate to, among other things, our future events, future financial performance, results of operations, strategic plans and objectives, and recent accounting pronouncements. We caution you that the foregoing list may not include all of the forward-looking statements made in this Annual Report. All of our forward-looking statements include assumptions underlying or relating to such statements that may cause actual results to differ materially from those that we are currently expecting, and are subject to considerable risks and uncertainties impacted by various factors, including the following, without limitation:
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the occurrence of natural disasters such as the Maui wildfires that occurred on August 8, 2023, changes in weather conditions, or threats of the spread of contagious diseases, such as the COVID-19 pandemic and its variants; |
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concentration of credit risk on deposits held at banks in excess of the Federal Deposit Insurance Corporation (the “FDIC”) insured limits and in receivables due from our commercial leasing portfolio; |
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unstable macroeconomic market conditions, including, but not limited to, energy costs, credit markets, interest rates, inflationary pressures, and changes in income and asset values; |
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risks associated with real estate investments, including demand for real estate and tourism in Hawai‘i and Maui; |
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security incidents through cyber-attacks or intrusions on our information systems; |
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our ability to complete land development projects within forecasted time and budget expectations; |
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our ability to obtain required land use entitlements at reasonable costs; |
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our ability to compete with other developers of real estate on Maui; |
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potential liabilities and obligations under various federal, state, and local environmental regulations; |
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our ability to cover catastrophic losses in excess of insurance coverages; |
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unauthorized use of our trademarks could negatively impact our business; |
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our ability to establish and maintain effective internal controls over financial reporting; |
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our ability to comply with funding requirements of our retirement plans; |
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our ability to comply with the terms of our indebtedness, including financial covenants, and to extend maturity dates, or refinance such indebtedness, prior to its maturity date; |
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availability of capital on terms favorable to us, and our ability to raise capital through the sale of certain real estate assets, sale of equity, or at all; |
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changes in U.S. accounting standards adversely impacting us. |
The forward-looking statements contained in this Annual Report are based on management’s current plans, estimates and expectations in light of information currently available to us, and they are subject to uncertainty and changes in circumstances. Actual results may differ materially from our expectations due to changes in global, regional or local political, economic, business, competitive, market, regulatory and other factors, many of which are beyond our control, as well as the other factors described in the section entitled “Risk Factors” within this Annual Report, our quarterly reports on Form 10-Q, and in the other reports we file with the SEC.
Although we believe that our opinions and expectations reflected in the forward-looking statements are reasonable as of the date of this Annual Report, we cannot guarantee future results, levels of activity, performance or achievements, and our actual results may differ substantially from the views and expectations set forth in this Annual Report. Thus, you should not place undue reliance on any forward-looking statements. New factors emerge from time to time, and it is not possible for us to predict which factors will arise. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Further, any forward-looking statements speak only as of the date made and, except as required by law, we undertake no obligation to publicly revise our forward-looking statements to reflect events or circumstances that arise after the date of this Annual Report.
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Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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Changes in and Disagreements with Accountants on Accounting and Financial Disclosure |
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Disclosure Regarding Foreign Jurisdictions that Prevent Inspections |
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Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters |
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Certain Relationships and Related Transactions, and Director Independence |
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| BUSINESS |
Overview
Maui Land & Pineapple Company, Inc. is a Delaware corporation and the successor to a business organized in 1909 as a Hawai‘i corporation. The Company reincorporated from Hawai‘i to Delaware pursuant to a plan of conversion completed on July 18, 2022. Total authorized capital stock of the Company includes 48,000,000 shares, consisting of 43,000,000 shares of common stock, par value $0.0001 per share, and 5,000,000 shares of preferred stock, par value $0.0001 per share. Shares of the Company’s common stock are listed on the New York Stock Exchange (“NYSE”) under the ticker symbol “MLP.”
Depending upon the context, the terms “Company,” “we,” “our,” and “us,” refer to either Maui Land & Pineapple Company, Inc. alone, or to Maui Land & Pineapple Company, Inc. and its subsidiaries collectively. The Company consists of a landholding and operating parent company, has a principal subsidiary, Kapalua Land Company, Ltd., and certain other subsidiaries.
We own approximately 22,300 acres of land and 247,000 square feet of commercial property on the island of Maui, Hawai‘i which we put into productive use by planning, managing, developing, and selling residential, resort, commercial, agricultural, and industrial real estate through three business segments:
| Land Development & Sales: |
Our land development and sales operations consist of land planning and entitlement, development, development related construction, and sales activities. |
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| Leasing: |
Our leasing operations include commercial, agricultural, and industrial land and property leases, licensing of our registered trademarks and trade names, management of potable and non-potable water systems in West and Upcountry Maui, and stewardship of conservation areas. |
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| Resort Amenities: |
Our resort amenities operations include the operations of the Kapalua Club, a private, non-equity club, providing its members special programs, access, and other privileges at certain amenities in the Kapalua Resort. |
For additional information and operating results related to the above business segments refer to the section entitled “Business Segments” in this Item 1 and in Note 13 to our financial statements set forth in Item 8 of this Annual Report.
Business Segments
Land Development and Sales
Our Land Development and Sales segment includes all land planning, entitlement, development, and sales activities of our landholdings on Maui. Our principal real estate development is the Kapalua Resort, a master-planned, destination resort and residential community located in West Maui. The following is a summary of our landholdings in approximate number of acres as of December 31, 2024:
| West Maui |
Upcountry Maui |
Total |
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| Commercial/Industrial |
19 | - | 19 | |||||||||
| Residential/Resort/Mixed-use |
866 | - | 866 | |||||||||
| Agricultural |
8,871 | 1,485 | 10,356 | |||||||||
| Conservation/watershed |
11,045 | - | 11,045 | |||||||||
| Total |
20,801 | 1,485 | 22,286 | |||||||||
Revenues from our Land Development and Sales segment totaled approximately $520,000, or 5% of our total operating revenues for the year ended December 31, 2024.
Real Estate Planning and Entitlements – In certain cases we must obtain appropriate entitlements and approvals for the land we intend to develop. Securing proper land entitlements is a process that may require county, state, and federal approvals, which can take years to complete and entails a variety of risks. The entitlement process requires that we satisfy certain conditions and restrictions in connection with such governmental approvals, including, among other things, infrastructure improvements and impact fees in the form of dedicated land for schools and public parks, provide traffic mitigation measures, restrictions on permitted uses of the land, and provisions of affordable housing. We actively work with the community, regulatory agencies, and legislative bodies at all levels of government to obtain and manage necessary approvals consistent with the needs of the community.
In 2024, under new leadership, our primary activities in this segment focused on the marketing and sale of non-strategic parcels and initiating the development of active projects. In addition to strategic planning of our entire asset portfolio, we have approximately 7,985 acres of land on Maui that are in various stages of active planning and development process. The following is a summary of our active land development projects as of December 31, 2024:
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Zoned for |
Approximate Project |
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Number of Acres |
Planned Use |
Start/End Dates |
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| Upcountry Maui - Baldwin Ranch Estates Phase 2 (JV) |
31 | Yes |
2024-2025 | |||||
| West Maui - Kapalua Resort - Makai |
37 | Yes |
2024-2034 | |||||
| West Maui - Kapalua Resort - Central |
46 | Yes |
2024-2031 | |||||
| West Maui - Kapalua Resort - Mauka |
927 | Yes |
2024-2034 | |||||
| West Maui - State Temporary Housing |
50 | Yes |
2024-2026 | |||||
| Upcountry Maui - Hali'imaile Ranch |
325 | Yes |
2024-2031 | |||||
| West Maui - Honokeana Farms |
1,503 | Yes |
2024-2033 | |||||
| West Maui - Kapalua Ranch |
915 | Yes |
2025-2030 | |||||
| Upcountry Maui - Hali‘imaile Farms |
757 | Yes |
2025-2034 | |||||
| West Maui - Kahana Farms |
3,046 | Yes |
2025-2036 | |||||
| Upcountry Maui - Hali‘imaile Farm Land |
348 | Yes |
2025-2035 | |||||
| Total |
7,985 | |||||||
We are engaged in planning, permitting and entitlement activities of real estate development projects, and we intend to proceed with construction and sales of the following projects, among others, when internal and external factors permit:
West Maui - Kapalua Resort: We began development of the Kapalua Resort in the early 1970’s. Today, the Kapalua Resort is an internationally recognized world-class destination resort, beach, golf and residential community. We presently have entitlements to develop a variety of projects in the Kapalua Resort. Three projects that are currently in various stages of planning include Kapalua Central Resort, Kapalua Mauka, and Kapalua Makai.
Kapalua Makai is a 37-acre project of the Kapalua Resort which is located adjacent to Honokahua Bay, also known as DT Fleming Beach Park. The land has State and County land use entitlements to deliver up to up to 573 residences, 349 hotel units, and new commercial and/or resort amenities. As of this filing, planning efforts are in process the project.
Kapalua Central Resort is a commercial town center and residential community located in the heart of the Kapalua Resort. It is comprised of 46 acres and State and County land use entitlements have been secured for this project. The project is currently planned to include up to 196 residential units and 61,000 square feet of commercial space. In December 2021, we entered into an agreement to sell the Kapalua Central Resort property for $40.0 million. On April 11, 2023, we regained control of the project from the buyer. We are currently processing an extension of a Special Management Area (“SMA”) permit issued by the County of Maui. We are actively working with our consultants and engaging with the community in preparation for the permit extension, which is anticipated to occur in 2025 or 2026.
Kapalua Mauka was master planned and entitled in 2008 as a luxury single-family residential neighborhood within Kapalua Resort. The property is located directly upslope of the existing resort development. The first phase of Kapalua Mauka, consisting of 51 residential lots, was subdivided, sold to a developer, and has since been completed. The remaining project area encompasses approximately 930 acres of land and has State and County land use entitlements to deliver up to 639 single-family homes, resort amenities, and an additional golf course or recreational space. As of this filing, planning and pre-development efforts are underway for the project.
Upcountry Maui - Hali'imaile Town:
Hali‘imaile is an existing town located in Upcountry Maui, adjacent to historic Makawao Town. We own approximately 1,485 acres in Hali‘imaile zoned for agriculture, light industrial, and business. The majority of this land is in the federal Tax Cuts and Jobs Act (“TCJA”) Opportunity Zone. Our landholdings include 290 acres classified for growth potential as “Small Town” in the long-range County of Maui Island Plan. As of this filing, we are underway with development activities including planning, design, and subdivision for all land in Hali‘imaile.
In December 2023, we entered into a joint venture, BRE2 LLC, with Stone Properties, a Maui based developer. The joint venture developed approximately 31 acres in Hali‘imaile Town into two ranch lots. The LLC sold one ranch lot during the year ended December 31, 2024. The second ranch lot sold and closed in February 2025.
As we develop these and other strategic projects, we expect to finance pre-development costs with operating revenues, proceeds from non-strategic land sales, debt financing, capital from joint venture partners, other sources, or a combination of these methods.
The price and market for resort and other real estate in Maui is generally cyclical and influenced significantly by interest rates, other real estate markets in the mainland United States, specifically the west coast, where Hawai‘i is a popular location for vacations and the second-home market, the general condition of the economy in the United States and Asia, and the relationship of the dollar to foreign currencies. Our Land Development and Sales segment faces competition from other landowners and developers in Maui, as well as in other parts of Hawai‘i and the mainland United States. Our land holdings in West Maui are highly desired due to their proximity to beaches and amenities, along with a natural grade which provides a majority of the land with unobstructed ocean views.
Leasing
Our Leasing segment includes commercial, industrial, and agricultural leases of land and property, licensing of our registered trademarks and trade names, sales of potable and non-potable water in West and Upcountry Maui, and grants related to watershed stewardship and conservation efforts.
Revenues from our Leasing segment totaled $9.6 million, or approximately 83% of our total operating revenues for the year ended December 31, 2024.
Commercial and Industrial Leases – We are the owner and lessor of approximately 247,328 square feet of commercial, retail and light industrial properties, including restaurants, retail outlets, office buildings, warehouses and Kapalua Resort activities. The following summarizes information related to our commercial, retail and industrial leases as of December 31, 2024:
| Total |
Average |
Lease |
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| Square |
Occupancy |
Expiration |
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| Footage |
Percentage |
Dates |
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| Kapalua Resort |
72,169 | 85% | 2025-2032 | |||||||||
| Other West Maui |
40,050 | 98% | 2025-2034 | |||||||||
| Upcountry Maui |
135,109 | 82% | 2025-2032 | |||||||||
Agricultural Leases – We own, market, and lease approximately 10,300 acres of diversified agriculture, ranching, renewable energy, eco tours, and activities in West and Upcountry Maui.
Trademark and Trade Name Licensing – Our primary trademarks and trade names include Kapalua, the Kapalua butterfly logo and the Maui Gold name and associated pineapple logo. We currently have licensing agreements for the use of these trademarks and trade names with several different companies, mainly in conjunction with our agricultural, commercial and industrial leases.
Potable and Non-Potable Water Systems – We own and operate several potable water wells, non-potable irrigation water ditches, reservoirs and transmission systems serving the Kapalua Resort, the County of Maui, and agricultural users in West and Upcountry Maui.
Stewardship and Conservation – We own and manage the conservation of a 9,000-acre nature and watershed preserve in West Maui known as the Pu‘u Kukui Watershed Preserve. A portion of our stewardship and conservation efforts is subsidized by the State of Hawai‘i.
Our Leasing segment is highly sensitive to economic conditions, including tourism and consumer spending levels, and faces substantial competition from other property owners in both Maui and Hawai‘i as a whole. The amount of rainfall and the level of development in the Kapalua Resort area also affect the demand and associated availability for our potable and non-potable water.
Resort Amenities
Our Resort Amenities segment includes the operations of the Kapalua Club, a private, non-equity club providing its members special programs, access and other privileges at certain amenities at the Kapalua Resort, including a 30,000 square foot full-service spa and fitness center, a private pool-side dining beach club, and two 18-hole championship golf courses.
Revenues from our Resort Amenities segment totaled $1.4 million, or approximately 12% of our total operating revenues for the year ended December 31, 2024.
The Kapalua Club is principally dependent on the overall appeal and success of the Kapalua Resort. The resort faces competition from other resort destination communities on Maui and other parts of Hawai‘i.
Employees
As of December 31, 2024, we had fifteen employees, fifteen of which were full-time employees. None of our employees are members of a collective bargaining group.
We have adopted a Code of Business Conduct and Ethics, which applies to all of our directors, officers and employees. We also utilize an ethics reporting email and voice system which is monitored by the Audit Committee of the Board of Directors (“the Board”). Our Code of Business Conduct and Ethics is available on our website at www.mauiland.com under the Investor section of the website. We will promptly disclose on our website the nature of any amendment to, or waiver or implicit waiver from, our Code of Business Conduct and Ethics that applies to any principal executive officer, principal financial officer, principal accounting officer or persons performing similar functions.
Available Information
Our internet address is www.mauiland.com. Reference in this Annual Report to this website address does not constitute incorporation by reference of the information contained on the websites. We make available free of charge on or through our website our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and other reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act, as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. We also make available through our website all filings of our executive officers and directors on Forms 3, 4 and 5 pursuant to Section 16 of the Exchange Act. These filings are also available on the SEC’s website at www.sec.gov.
| RISK FACTORS |
Our short and long-term success is subject to numerous risks and uncertainties, many of which involve factors that are difficult to predict or beyond our control. As a result, investing in our common stock involves substantial risk. Our stockholders should carefully consider the risks and uncertainties described below, in addition to the other information contained in or incorporated by reference into this Annual Report, as well as the other information we file with the SEC from time to time. If any of these risks are realized, our business, financial condition, results of operations, liquidity and prospects could be materially and adversely affected. In that case, the value of our common stock could decline, and stockholders may lose all or part of their investment. Furthermore, additional risks and uncertainties of which we are currently unaware, or which we currently consider to be immaterial, could have a material adverse effect on our business. Certain statements made in this section constitute “forward-looking statements,” which are subject to numerous risks and uncertainties including those described in this section. For additional information, refer to the section entitled “Cautionary Note Regarding Forward-Looking Statements” within this Annual Report.
Risks Related to our Business
Unstable macroeconomic market conditions could materially and adversely affect our operating results.
Our operations and performance depend on worldwide economic conditions. Uncertainty about global economic conditions poses a risk to our business as consumers, tourists and real estate investors postpone or reduce spending in response to tighter credit markets, energy costs, negative financial news, reduced consumer confidence, and/or declines in income or asset values, which could have a material negative effect on the demand for our products and services. Other factors that could influence demand include increases in fuel costs, conditions in the residential real estate and mortgage markets, interest rates, labor costs, access to credit on reasonable terms, geopolitical issues, and other macroeconomic factors affecting consumer spending behavior. These and other economic factors could have a material adverse effect on demand for our products and services and on our financial condition and operating results.
In addition, should current equity or credit market conditions deteriorate, or if our expenses increase unexpectedly, it may become necessary for us to raise additional capital in the form of a debt or equity financing, or a combination of the two. A downturn in industry, market or economic conditions could make debt or equity financing more difficult, more costly, and, in the case of an equity financing, more dilutive to our existing stockholders. Failure to secure any necessary financing in a timely manner and on favorable terms could have a material adverse effect on our ability to execute our current business strategy, as well as our financial performance and stock price.
Real estate investments are subject to numerous risks and we are negatively impacted by downturns in the real estate market.
We are subject to risks that generally relate to investments in real property because we develop, sell, and lease real property, primarily for residential use. The market for real estate on Maui and in Hawai‘i generally tends to be highly cyclical and is typically affected by numerous changes in local, national, and worldwide conditions, especially economic conditions, many of which are beyond our control, including the following:
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periods of economic uncertainty and weakness in Hawai‘i and in the United States generally; |
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uncertainties and changes in U.S. social, political, regulatory, and economic conditions or laws and policies, and concerns surrounding ongoing developments in the European Union, the Middle East and Asia; |
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high unemployment rates and low consumer confidence; |
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the general availability of mortgage financing, including the effect of more stringent lending standards for mortgages and perceived or actual changes in interest rates; |
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energy costs, including fuel costs, which could impact the cost and desirability of traveling to Hawai‘i; |
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local, state, and federal government regulation, including eminent domain laws, which may result in a taking for less compensation than what we believe our property is worth; |
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the popularity of the Kapalua Resort area, the island of Maui, and the State of Hawai‘i as a vacation destination or second home market; |
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the relationship of the dollar to foreign currencies; |
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tax law changes, including limits or potential elimination of the deductibility of certain mortgage interest expenses, real property taxes and employee relocation expenses; and/or |
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acts of God, such as wildfires as recently experienced on Maui, tsunamis, hurricanes, earthquakes, and other natural disasters, including the impacts of the COVID-19 pandemic and its variants. |
Changes in any of the foregoing could have a material adverse effect on our business by causing a more significant decline in the market for residential or luxury real estate, which, in turn, could adversely affect our development plans, revenues and profitability. During low periods of demand, real estate may remain on hand for much longer than expected or be sold at lower-than-expected returns, or even at a loss, which could impair our liquidity and ability to proceed with development projects and negatively affect our operating results. Sustained adverse changes to our development plans could result in impairment charges or write-offs of deferred development costs, which could have a material adverse impact on our financial condition and results of operations. In addition, in the current economic environment, equity real estate investments may be difficult to sell quickly and we may not be able to adjust our portfolio of properties quickly in response to economic or other conditions.
Because we are located in Hawai‘i and therefore apart from the mainland United States, our financial results are more sensitive to certain economic factors, such as spending on tourism and increased fuel and travel costs, which may adversely impact and materially affect our business, financial condition and results of operations.
Our businesses are dependent on attracting visitors to the Kapalua Resort, to the island of Maui, and to the State of Hawai‘i as a whole. Economic factors that affect the number of visitors, their length of stay or expenditure levels will affect our financial performance. Factors such as worldwide economic uncertainty and weakness, the level of unemployment in Hawai‘i and the mainland United States, natural disasters, substantial increases in the cost of energy, including fuel costs, and events in the airline industry that may reduce passenger capacity or increase traveling costs could reduce the number of visitors to the Kapalua Resort and negatively affect a potential buyer’s demand for our future property developments, each of which could have a material adverse impact on our business, financial condition and results of operations. In addition, the threat, or perceived threat, of heightened terrorist activity in the United States or other geopolitical events, or the threat, or perceived threat, of the spread of contagious diseases, such as COVID-19 and its variants, could negatively affect a potential visitor’s choice of vacation destination or second home location or result in travel bans that could, as a result, have a material adverse impact on our business, financial condition and results of operations.
We have previously been involved in joint ventures and may be subject to risks associated with future joint venture relationships.
We have previously been involved in partnerships, joint ventures and other joint business relationships, and may initiate future joint venture projects. A joint venture involves certain risks such as:
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our actual or potential lack of voting control over the joint venture; |
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our ability to maintain good relationships with our joint venture partners; |
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a venture partner at any time may have economic or business interests that are inconsistent with ours, especially in light of economic uncertainty and weakness; |
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a venture partner may fail to fund its share of operations and development activities, or to fulfill its other commitments, including providing accurate and timely accounting and financial information to us; and |
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a joint venture or venture partner could lose key personnel. |
In connection with our joint venture projects, we may be asked to guarantee the joint venture’s obligations, or to indemnify third parties in connection with a joint venture’s contractual arrangements. If we were to become obligated under such arrangements or become subject to the risks associated with joint venture relationships, our business, financial condition and results of operations may be adversely affected.
If we are unable to complete land development projects within forecasted time and budget expectations, if at all, our financial results may be negatively affected.
We intend to develop subdivisions, resort and other properties as suitable opportunities arise, taking into consideration the general economic climate. New project developments have a number of risks, including risks associated with:
| • |
construction delays or cost overruns that may increase project costs; |
| • |
receipt of zoning, subdivision, water availability, occupancy and other required governmental permits and authorizations; |
| • |
development costs incurred for projects that are not pursued to completion; |
| • |
earthquakes, tsunamis, hurricanes, floods, fires or other natural disasters that could adversely impact a project; |
| • |
defects in design or construction that may result in additional costs to remedy or require all or a portion of a property to be closed during the period required to rectify the situation; |
| • |
ability to raise capital; |
| • |
impact of governmental fines and assessments such as park fees or affordable housing requirements; |
| • |
governmental restrictions on the nature or size of a project or timing of completion; and |
| • |
the potential lack of adequate building/construction capacity for large development projects. |
If any development project is not completed on time or within budget, this could have a material adverse effect on our financial results.
If we are unable to obtain required land use approvals at reasonable costs, or at all, our operating results would be adversely affected.
The financial performance of our Land Development and Sales segment is dependent upon our success in obtaining discretionary and ministerial approvals for proposed development projects. Obtaining all the necessary approvals to develop a parcel of land is often difficult, costly and may take several years, or longer, to complete. In some situations, we may be unable to obtain the necessary approvals to proceed with a real estate development or may be required to alter our plans for the development. Delays or failures to obtain these approvals may have a material adverse effect on our financial results.
If we are unable to successfully compete with other developers of real estate in Maui, our financial results could be materially adversely affected.
Our real estate products face significant competition from other luxury resort real estate properties on Maui, and from other residential property in Hawai‘i and the mainland United States. In many cases, our competitors are larger than us and have greater access to capital. If we are unable to compete with these competitors, our financial results could be materially adversely affected.
We may be subject to certain environmental regulations under which we may have additional liability and experience additional costs for land development.
Various federal, state, and local environmental laws, ordinances and regulations regulate our properties and could make us liable for the costs of removing or cleaning up hazardous or toxic substances on, under, or in property we currently own or operate or that we previously owned or operated. These laws could impose liability without regard to whether we knew of, or were responsible for, the presence of hazardous or toxic substances. The presence of hazardous or toxic substances, or the failure to properly clean up such substances when present, could jeopardize our ability to develop, use, sell or rent our real property or to borrow using our real property as collateral. If we arrange for the disposal or treatment of hazardous or toxic wastes, we could be liable for the costs of removing or cleaning up wastes at the disposal or treatment facility, even if we never owned or operated that facility. Certain laws, ordinances, and regulations, particularly those governing the management or preservation of wetlands, coastal zones and threatened or endangered species, could limit our ability to develop, use, sell or rent our real property.
Changes in weather conditions or natural disasters could adversely impact and materially affect our business, financial condition, and results of operations.
Natural disasters, including wildfires, tsunamis, hurricanes, earthquakes and others, could damage our resort and real estate holdings, resulting in substantial repair or replacement costs to the extent not covered by insurance, a reduction in property values, or a loss of revenue, each of which could have a material adverse impact on our business, financial condition and results of operations. Our competitors may be affected differently by such changes in weather conditions or natural disasters depending on the location of their assets or operations. The wildfires in August 2023 devasted the town of Lahaina, Maui and negatively impacted tourism to the area and the local economy. We expect the aftermath of the wildfires to continue to impact commercial activity throughout the island of Maui, and there is uncertainty as to how long it will take Maui to rebuild, return tourism to historic levels, and recover economically. Until such time as commercial activity and tourism return to normal levels, the impact of the wildfires may continue to negatively impact operations.
Our insurance coverages may be inadequate to cover any losses we incur.
We maintain various insurance coverages for our business. We have engaged experts to assist us in the determination of our insurance policy terms, including coverage limits and deductibles, based on an evaluation of the level of potential risk, exposure and costs involved. This may result in insurance coverage that may not be sufficient to cover the full value of our losses in certain catastrophic or unforeseen circumstances. In addition, securing coverage in the event we file a claim under our insurance policies may involve substantial time, effort, resources, and the risk that the insurance carrier may deny or dispute coverage under the policy. Under such circumstances, we may not receive insurance proceeds or the insurance proceeds we receive may not fully cover business interruptions or losses and our operating results, liquidity and financial condition could be adversely affected.
Unauthorized use of our trademarks could negatively impact our businesses.
We have several trademarks that we have been registered in the United States and in several foreign countries. To the extent that our exclusive use of these trademarks is challenged, we intend to vigorously defend our rights. If we are not successful in defending our rights, our businesses could be adversely impacted.
Market volatility of asset values and interest rates affect the funded status of our defined benefit pension plans and could, under certain circumstances, have a material adverse effect on our financial condition.
We have a defined benefit pension plan which was frozen with respect to benefits and the addition of participants in 2011. The Board approved the termination of the Defined Plan and the Non-qualified Plan in 2023. The funded status and our ability to satisfy the future obligations of the plan is affected by, among other things, changes in interest rates, returns from plan asset investments, and actuarial assumptions including the life expectancies of the plan’s participants. If we are unable to adequately fund or meet our future obligations with respect to the plan, our business, financial condition and results of operations may be adversely affected.
Changes in U.S. accounting standards may adversely impact us.
The regulatory boards and government agencies that determine financial accounting standards and disclosures in the U.S., including the Financial Accounting Standards Board (“FASB”) and the International Accounting Standards Board (“IASB”) (collectively, the “Boards”) and the SEC, continually change and update the financial accounting standards we must follow.
Any difficulties in the implementation of changes in accounting principles, including the ability to modify our accounting systems and to update our policies, procedures, information systems, and internal controls over financial reporting, could result in materially inaccurate financial statements, which in turn could harm our operating results or cause us to fail to meet our reporting obligations. The adoption of new accounting standards could also affect the calculation of our credit facility covenants. We cannot be assured that we will be able to work with our lenders to amend our credit facility covenants in response to changes in accounting standards.
Security incidents through cyber-attacks, cyber intrusions, or other methods could disrupt our information technology networks and related systems, cause a loss of assets or loss of data, give rise to remediation or other expenses, expose us to liability under federal and state laws, and subject us to litigation and investigations, which could result in substantial reputational damage and materially and adversely affect our business, financial condition, results of operations, cash flows, and the market price of our common stock.
Information technology, communication networks, and related systems are essential to the operation of our business. We use these systems to manage our tenant, vendor and customer relationships, internal communications, accounting and record-keeping systems, and many other key aspects of our business. Our operations rely on the secure processing, storage, and transmission of confidential and other information in our computer systems and networks, which also depend on the strength of our procedures and the effectiveness of our internal controls.
A security incident may occur through physical break-ins, breaches of our secure network by an unauthorized party, software vulnerabilities, malware, computer viruses, attachments to emails, employee theft or misuse, social engineering, or inadequate use of security controls. Outside parties may attempt to fraudulently induce our employees to disclose sensitive information or transfer funds via illegal electronic spamming, phishing, spoofing or other tactics. Additionally, cyber attackers can develop and deploy malware, credential theft or guessing tools, and other malicious software programs to gain access to sensitive data or fraudulently obtain assets we hold.
We have implemented security measures to safeguard our systems and data and to manage cyber security risk. We monitor and develop our information technology networks and infrastructure and invest in the development and enhancement of our controls designed to prevent, detect, address, and mitigate the risk of unauthorized access, misuse, computer viruses, and other events that could have a security impact. We conduct periodic security awareness trainings for our employees to educate them on how to identify and alert management regarding phishing emails, spoofed or manipulated electronic communications, and other critical security threats. We have implemented internal controls around our treasury function including enhanced payment authorization procedures, verification requirements for new vendor set-up and vendor information changes and bolstered outgoing payment notification processes and account reconciliation procedures.
While, to date, we are not aware of having experienced a significant security incident or cyber-attack, there can be no assurance that our actions, security measures, and controls designed to prevent, detect, or respond to intrusion; to limit access to data; to prevent loss, destruction, alteration, or exfiltration of business information; or to limit the negative impact from such attacks can provide absolute security against a security incident.
A principal reason that we cannot provide absolute protection from security incidents is that it may not always be possible to anticipate, detect, or recognize threats to our systems, or to implement effective preventive measures against all security incidents due to, among other things, the frequent change in techniques used in cyber-attacks, which may not be recognized until launched, and the wide variety of sources from which a cyber-attack can originate. We may not be able to immediately address the consequences of a security incident due to a cyber-attack.
The extent of a particular cyber-attack and the steps that we may need to take to investigate the attack may not be immediately clear. Therefore, in the event of an attack, it may take a significant amount of time before such an investigation can be completed. During an investigation, we may not necessarily know the extent of the damage incurred or how best to remediate it, and certain errors or actions could be repeated or compounded before they are discovered and remediated, which could further increase the costs and consequences of a cyber-attack.
Even if we are not targeted directly, cyber-attacks on the U.S. government, financial markets, financial institutions, or other businesses, including our tenants, vendors, software creators, cloud providers, and other third parties with whom we do business, could disrupt our normal business operations and networks.
We maintain insurance to protect ourselves against certain losses incurred in the event of a security incident or disruption of our information systems. However, we cannot be certain that the coverage will be adequate to compensate us for all damages that may arise. In addition, we cannot be certain that such insurance coverages will remain available to us in the future on commercially reasonable terms, or at all.
Risks Related to Indebtedness
We have entered into a credit agreement for a $15.0 million revolving line of credit facility with a bank. The credit facility has a maturity date of December 31, 2025 and its terms include certain financial and operating covenants, which if we fail to satisfy, could accelerate our repayment obligations, and adversely affect our operations and financial results.
The terms of our credit facility include covenants requiring among other things, a minimum of $2.0 million in liquidity (as defined), a maximum of $45.0 million in total liabilities and a limitation on new indebtedness. Our ability to continue to borrow under our credit facility to fund our business initiatives depends upon our ability to comply with these covenants.
Our business initiatives for the next twelve months include investing in our operating infrastructure and continued planning and pre-development efforts on our land development and sales projects. At times, this may require borrowing under our credit facility or other indebtedness, repayment of which may be dependent on selling of our real estate assets at acceptable prices in condensed timeframes.
Our indebtedness could have the effect of, among other things, increasing our exposure to general adverse economic and industry conditions, limiting our flexibility in planning for, or reacting to, changes in our business and industry, and limiting our ability to borrow additional funds.
Risks Relating to our Stock
Our stock price has been subject to significant volatility.
During the year ended December 31, 2024, the low and high share prices of our common stock ranged from $16.43 to $26.01. Our stock price has been, and may continue to be, subject to significant volatility. Among others, including the risks and uncertainties discussed in this Annual Report, the following factors, some of which are out of our control, may cause the market price of our common stock to continue to be volatile:
| • |
our quarterly or annual earnings or those of other companies in our industry; |
| • |
actual or unanticipated fluctuations in our operating results; |
| • |
the relatively low volume of trading in our stock; and |
| • |
the lack of significant securities analysts’ coverage of our stock. |
Fluctuations in the price of our common stock may also be exacerbated by economic and other conditions in Maui in particular, or conditions in the financial markets generally.
Share ownership by our affiliates make it more difficult for third parties to acquire us or effectuate a change of control that might be viewed favorably by other stockholders.
Affiliates of our company owned, in the aggregate, a majority of our outstanding shares at December 31, 2024. As a result, if these affiliates were to oppose a third party’s acquisition proposal for, or a change in control of, the Company, these affiliates may have sufficient voting power to be able to block or at least delay such an acquisition or change in control from taking place, even if other stockholders would support such a sale or change of control.
Trading in our stock over the last twelve months has been limited, so investors may not be able to sell as much stock as they want at prevailing prices.
The average daily trading volume in our common stock for the year ended December 31, 2024 was approximately 19,000 shares. If limited trading in our stock continues, it may be difficult for investors to sell their shares in the public market at any given time at prevailing prices. Moreover, the market price for shares of our common stock may be made more volatile because of the relatively low volume of trading in our common stock. When trading volume is low, significant price movement can be caused by the trading in a relatively small number of shares. Volatility in our common stock could cause stockholders to incur substantial losses.
We do not anticipate declaring any cash dividends on our common stock.
We have not declared or paid regular cash dividends on our common stock. Our current policy is to retain all funds and any earnings for use in the operation and expansion of our business. The payment of cash dividends by us is restricted by our credit facility which contains covenants prohibiting us from paying any cash dividends without the lender’s prior approval. If we do not pay dividends, our stock may be less valuable to you because a return on your investment will only occur if our stock price appreciates.
We may need additional funds which, if available, could result in significant dilution to our stockholders, have superior rights to our common stock and contain covenants that restrict our operations.
If unanticipated contingencies or other unforeseen circumstances arise, it may be necessary for us to raise additional capital either through public or private equity or debt financing. We cannot say with any certainty that we will be able to obtain the additional needed funds on reasonable terms, or at all. If we were to raise capital through the issuance of our common stock or securities convertible or exercisable into our common stock, our existing stockholders may suffer significant dilution. If we issued preferred equity or debt securities, these securities could have rights superior to holders of our common stock and could contain covenants that will restrict our operations. If additional funds are raised through a bank credit facility or the issuance of debt securities, the holder of such indebtedness would have rights senior to the rights of equity holders and the terms of such indebtedness could impose restrictions on our operations.
| UNRESOLVED STAFF COMMENTS |
Not applicable.
| CYBERSECURITY |
Risk management and strategy
Our IT Manager, along with the information security and technical consultants hired by us, help identify, assess, and manage our cybersecurity threats and risks. They work to identify and assess risks from cybersecurity threats by monitoring and evaluating the threat environment using various methods including manual and automated tools, subscribing to reports and services that identify cybersecurity threats, evaluating our and our industry’s risk profile, conducting audits and threat assessments, conducting vulnerability assessments, and external threat intelligence.
Depending on the environment, system, and data, we implement and maintain certain technical and organizational measures, processes, standards and policies designed to manage and mitigate material risks from cybersecurity threats to our Information Systems and Data, including, for example: incident response procedures, vulnerability management process, disaster recovery/business continuity plans, encryption, network security controls, user access controls including multifactor authentication and role-based access, data segregation, asset management, systems monitoring, vendor risk management program, employee training, penetration testing and cybersecurity insurance.
Our assessment and management of material risks from cybersecurity threats are integrated into our overall risk management processes, including by prioritizing our risk management processes and mitigating cybersecurity threats that are more likely to lead to a material impact to our business.
We use -party service providers to assist us from time to time to identify, assess, and manage material risks from cybersecurity threats, including, for example, professional services firms, cybersecurity consultants, managed cybersecurity service providers, penetration testing firms, and forensics investigators as needed.
We also use third-party service providers to perform a variety of functions throughout our business, such as application providers, hosting companies, and various supply chain resources. We have a vendor management program to manage cybersecurity risks associated with our use of these providers which includes, depending on the vendor, nature of the services provided, and sensitivity of the Information Systems and Data at issue: different levels of assessment designed to help identify cybersecurity risks associated with the vendor, security questionnaires, review of security assessments, and imposition of contractual obligations related to cybersecurity.
Governance
| PROPERTIES |
Most of our land was acquired from 1911 to 1932 and, accordingly, has a relatively low-cost basis. The following is a summary of the approximate acreage of our landholdings as of December 31, 2024:
| Acres |
||||
| West Maui |
20,801 | |||
| Upcountry Maui |
1,485 | |||
| Total |
22,286 | |||
Our West Maui landholdings are comprised of several, largely contiguous parcels that extend from the sea to the top of the second largest mountain on Maui, at an elevation of approximately 5,700 feet. It includes approximately 900 acres of land entitled for commercial, residential, hotel, or other mixed-use development within the Kapalua Resort. Leasing revenue is generated from restaurants, retail outlets, office buildings, warehouses, and other resort activities. The remaining lands consist of former pineapple fields, gulches, undeveloped coastal and forest areas, and our 9,000-acre conservation watershed preserve. These properties generate leasing revenue from agricultural and industrial leases, management of water systems, sales of potable and non-potable water, and stewardship and conservation grants.
Our Upcountry Maui landholdings are situated at elevations between 1,000 and 2,000 feet above sea level on the slopes of Haleakala, a volcanic-formed mountain on the island that rises above 10,000 feet in elevation. These properties generate leasing revenue from commercial, industrial, and agricultural leasing.
We have pledged certain of our real estate properties in the Kapalua Resort as security for borrowings under our credit facility.
We own our corporate offices located in the Kapalua Resort in West Maui and in Upcountry Maui. We believe our facilities are suitable and adequate for our business and have sufficient capacity for the purposes for which they are currently being used or intended to be used. For additional information, refer to the section entitled “Business” in this Annual Report.
| LEGAL PROCEEDINGS |
On December 31, 2018, the State of Hawai‘i Department of Health (“DOH”) issued a Notice and Finding of Violation and Order (“Order”) for alleged wastewater effluent violations related to our Upcountry Maui wastewater treatment facility. The facility was built in the 1960’s to serve approximately 200 single-family homes developed for workers in our former agricultural operations. The facility is made up of two 1.5-acre wastewater stabilization ponds and surrounding disposal leach fields. The Order includes, among other requirements, payment of a $230,000 administrative penalty and improvements to the wastewater treatment plant.
The DOH agreed to defer the Order as we continue to work to resolve and remediate the facility’s wastewater effluent issues through an approved corrective action plan. The construction of additional leach fields and installations of a surface aerator, sludge removal system, and natural pond cover using water plants were completed. Test results from wastewater monitoring indicate effluent concentration amounts within allowable ranges. A feasibility study was prepared and submitted identifying various technical solutions that could be implemented to resolve the Order. We submitted a plan and proposed solution to resolve the Order. The plan included the installation of an additional pond that will be lined and installed with aerators. One of the existing ponds will be lined and renovated as necessary and the other pond will be taken offline and used as a backup pond if needed. The Company continues to make progress with the DOH and is awaiting approval of submitted engineering and design drawings from the State of Hawai‘i at the time of filing the Form 10-K.
We have accrued approximately $23,000 related to the administrative penalty as of December 31, 2024. We are presently unable to estimate the remaining amount, or range of amounts, of any probable liability, if any, related to the Order and no additional provision has been made in the accompanying financial statements.
From time to time, we are a party to various legal proceedings, disputes, and other claims, arising in the ordinary course of business. Although the results of these ordinary course matters cannot be predicted with certainty, we believe the final outcome of these ordinary course legal proceedings will not, individually or in the aggregate, have a material adverse effect on our operations, financial position or cash flows.
| MINE SAFETY DISCLOSURES |
Not applicable.
| MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES |
Our common stock is traded on the NYSE under the symbol “MLP.” As of March 27, 2025, there were 224 stockholders of record of our common stock, which do not include beneficial owners of our common stock whose shares are held in the names of various securities brokers, dealers and registered clearing agencies.
Dividend Policy
We have not declared or paid any cash dividends on our common stock since March 2001. We currently do not anticipate declaring or paying any cash dividends.
Unregistered Sales of Equity Securities
None.
Repurchases
None.
| [RESERVED] |
| MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
The following discussion and analysis of our Annual Report on Form 10-K and audited consolidated financial statements and related notes are for the year ended December 31, 2024. The following discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those expressed or implied by the forward-looking statements below. Factors that could cause or contribute to those differences in our actual results include, but are not limited to, those discussed below and those discussed elsewhere within this Quarterly Report, particularly in the section entitled “Cautionary Note Regarding Forward-Looking Statements.” Depending upon the context, the terms the “Company,” “we,” “our,” and “us,” refer to either Maui Land & Pineapple Company, Inc. alone, or to Maui Land & Pineapple Company, Inc. and its subsidiaries collectively.
Overview
We own and manage a diverse portfolio including approximately 22,300 acres of land on the island of Maui, Hawaii along with approximately 247,000 square feet of commercial real estate. For over a century, we have built a legacy of authentic innovation through conservation, agriculture, community building and land management. Our current portfolio of assets includes unimproved land, entitled land allowing for various residential and mixed-use construction, and completed commercial properties.
This past year we began to implement our strategic plan, driven by our steadfast mission of activating our assets into their most productive use. We accelerated a broad spectrum of land development and housing projects crafted to build stronger and more vibrant communities. We continued to strengthen our business foundation with the addition of key experts on our board and management team to ensure we could effectively establish plans for each parcel and self-perform value creating projects. In addition, we created a land management team responsible for risk mitigation strategies and productive use of fallow farm and ranch lands throughout our portfolio. Our local team has enhanced our ability to manage assets effectively and execute value-creating projects. We also established new office locations in West Maui and Upcountry, enabling our team to be present within the community to foster stronger relationships and ensure responsible stewardship of our assets.
In 2024, we advanced efforts to maximize the productivity of our leasable land and commercial properties. We identified and addressed critical deferred maintenance in our town centers, allowing us to create spaces for many businesses who lost their location in the 2023 Maui wildfires. This effort has increased occupancy and leasing revenue over the past year while adding vibrancy and creating a sense of place in our communities. At December 31, 2024, our commercial properties and land were occupied at the following levels:
| Commercial Real Estate |
Total |
Leased |
2024 Net increase (decrease) in leased area |
|||||||||||||
| Sq. ft. |
Sq. ft. |
Percent |
Sq. ft. |
|||||||||||||
| Industrial |
168,880 | 142,153 | 84 | % | 8,591 | |||||||||||
| Office |
10,105 | 10,105 | 100 | % | 3,978 | |||||||||||
| Retail |
61,004 | 56,312 | 92 | % | (471 | ) | ||||||||||
| Residential |
7,339 | 3,000 | 41 | % | - | |||||||||||
| Total CRE |
247,328 | 211,570 | 86 | % | 12,098 | |||||||||||
| Land |
Total |
Leased |
2024 Net increase (decrease) in leased area |
|||||||||||||
| Acres |
Acres |
Percent |
Acres |
|||||||||||||
| Comm./Ind. |
19 | 19 | 100 | % | - | |||||||||||
| Residential |
866 | 12 | 1 | % | - | |||||||||||
| Agriculture |
10,356 | 4,653 | 45 | % | 1,026 | |||||||||||
| Conservation |
11,045 | - | 0 | % | - | |||||||||||
| Total Land |
22,286 | 4,684 | 21 | % | 1,026 | |||||||||||
During 2024, the team increased commercial property occupancy from 72% to 86%, including tenant relocations and improvements necessary to enhance the variety and quality of experiences in our town centers. This effort will continue, along with capital improvements necessary to continue attracting top tier tenants. In addition to stable cashflow in a supply-constrained market, our commercial properties allow us to perform value-creating placemaking for our surrounding landholdings. We anticipate cashflow from our commercial properties to increase in the coming years as we reach stabilization, the Maui market continues to recover from the 2023 wildfire, and we complete the tenant improvements and leasing costs inherent with new tenancies.
To enable the productive use of land for homes, businesses, farms, resort projects, or otherwise, we generally must make improvements to the land. These improvements take the form of master planning, entitlements and zoning, subdivision of large parcels into useful lot sizes, or the addition of infrastructure, enabling it to be placed into productive use. In 2024, we completed portfolio-wide strategic plans across all 22,300 acres to prioritize and guide actions of the Company in the forthcoming quarters.
Our strategic plan for land utilization aligns with our mission to meet the current and future needs of the community, in a significantly supply-constrained market. In 2024, we listed non-strategic assets for sale and began monetizing them through direct customer sales and a structured partnership approach. The plan identified four categories of improved and unimproved land actions as follows in the table below.
| Category |
Region |
Property |
Approximate Land Area (acres) |
Current Land Use/Zoning |
Improvements in process |
# of Parcels or # of allowable units/lots |
| 1. Improved Land - Remnant and non-strategic parcels planned for sale |
West Maui |
Five Miscellaneous Non-strategic properties |
67 |
Miscellaneous |
N/A - Complete |
5 parcels |
| Upcountry |
Three Miscellaneous Non-strategic properties |
24 |
Miscellaneous |
N/A - Complete |
3 parcels |
|
| 2. Improved Land - Property in active marketing for sale and/or development |
Upcountry |
Baldwin Ranch Estates Phase 2 |
31 |
Agriculture |
Active construction and sales by JV partner. |
2 farm lots |
| West Maui |
Kapalua Resort - Makai |
37 |
Resort mixed-use |
Planning |
Existing Entitlements allow for up to 769 residential units, 545 hotel units, and commercial space across both project areas. |
|
| West Maui |
Kapalua Resort - Central |
46 |
Resort mixed-use |
Planning, Permitting |
||
| 3. Unimproved Land - Property in active planning and improvements |
West Maui |
Kapalua Resort - Mauka |
927 |
Resort Residential |
Planning, Permitting |
Existing Entitlements allow for up to 639 single-family homes or lots |
| West Maui |
Honokeana Homes – State Temporary Housing |
50 |
Agriculture |
Design, permitting |
Up to 200 single-family lots |
|
| Upcountry |
Hali‘imaile Ranch |
325 |
Agriculture |
Subdivision Design |
Approximately 24 farm lots |
|
| West Maui |
Honokeana Farms |
1,503 |
Agriculture |
Planning |
Approximately 250 farm lots across both project areas. |
|
| West Maui |
Kapalua Ranch |
915 |
Agriculture |
Planning |
||
| Upcountry |
Hali‘imaile Farms |
757 |
Agriculture |
Planning |
Approximately 102 farm lots |
|
| West Maui |
Kahana Farms |
3,046 |
Agriculture |
Planning |
Approximately 200 farm lots |
|
| Upcountry |
Hali‘imaile Farm Land |
348 |
Agriculture |
Planning |
TBD |
|
| 4. Unimproved Land - Property being marketed for long-term lease and ongoing asset management |
West Maui |
Honolua Farm Land |
1,758 |
Agriculture |
Asset management |
TBD |
| West Maui |
Honokohau Farm Land |
1,884 |
Agriculture |
Asset management |
TBD |
|
| West Maui |
Watershed Conservation Land |
10,328 |
Conservation |
Asset management |
TBD |
|
| West Maui |
Waterfront Conservation Land |
243 |
Conservation |
Asset management |
TBD |
|
| Total Land Portfolio Area (acres) |
22,289 |
|||||
Near-term sales revenues (1-3 years) may be anticipated from our remnant and non-strategic parcels for sale, along with improved land in active marketing for sale and/or development.
In 2024, our team began to self-perform priority land development projects, including the planning and engineering of Kapalua Resort projects and the preliminary subdivision of a 325-acre former ranch site in Upcountry, Maui. Unimproved land in active planning and improvements will likely require three or more years before improvements are completed and revenue generation is realized. Funding for soft cost improvements, if not covered by our commercial properties and land leasing cashflow, will likely be provided by remnant non-strategic parcel sales and our revolving line of credit. As infrastructure and site improvement hard costs are warranted, capital will primarily be provided by project presale deposits and construction financing.
For the Honokeana Homes State Temporary Housing Project, 50 acres has been leased to the State of Hawai‘i and we are administering the construction of improvements necessary to support temporary homes for individuals and families displaced by the Maui wildfires on August 8, 2023. The land will be leased to the State at no cost for five years, plus the duration of time necessary to construct the temporary homes. The land is a portion of a larger, 1,377-acre parcel owned by MLP. The Agreement provides the State will fund all costs to complete the project, including approximately $35,500,000 to complete the necessary horizontal improvements. MLP has agreed to administer the construction of the horizontal improvements and, at the State’s election, the subsequent vertical improvements which are yet to be estimated. MLP will provide its administration services to the State at its cost and will not directly profit from these services. After the end of the lease, the State will remove any vertical improvements unless MLP requests that specific improvements remain.
Unimproved land identified for long-term lease and ongoing asset management may be expected to be leased or licensed for diversified agricultural, conservation, and cultural uses for the next ten or more years. Approximately 1,000 acres has been leased to Ka Ike Ranch, a local family-owned and operated business committed to local food production and sustainable ranching. Unimproved land also includes the Pu’u Kukui Watershed, which is over 8,600 acres and is actively managed to maximize rainfall capture and recharge of the aquifer which provides approximately 70% of the water consumed in West Maui. The Company is focused on continuing to increase the occupancy of these agricultural lands to improve productivity via economic activity and local food production.
RESULTS OF OPERATIONS
Comparison of Years Ended December 31, 2024 and 2023
CONSOLIDATED
| Years Ended December 31, |
||||||||
| 2024 |
2023 |
|||||||
| (in thousands) |
||||||||
| Operating revenues |
$ | 11,565 | $ | 9,289 | ||||
| Segment operating costs and expenses |
(7,587 | ) | (6,547 | ) | ||||
| General and administrative |
(4,297 | ) | (3,998 | ) | ||||
| Share-based compensation |
(6,312 | ) | (2,846 | ) | ||||
| Depreciation |
(723 | ) | (869 | ) | ||||
| Operating loss |
(7,354 | ) | (4,971 | ) | ||||
| Gain from derecognition of nonfinancial asset |
- | 1,626 | ||||||
| Loss on asset disposal |
48 | - | ||||||
| Other income |
924 | 707 | ||||||
| Pension and other postretirement expenses |
(948 | ) | (436 | ) | ||||
| Interest expense |
(61 | ) | (6 | ) | ||||
| Net loss |
$ | (7,391 | ) | (3,080 | ) | |||
| Net loss per Common Share - Basic |
$ | (0.38 | ) | $ | (0.15 | ) | ||
| Net loss per Common Share - Diluted |
$ | (0.38 | ) | $ | (0.15 | ) | ||
LAND DEVELOPMENT AND SALES
| Years Ended December 31, |
||||||||
| 2024 |
2023 |
|||||||
| (in thousands) |
||||||||
| Operating revenues |
$ | 520 | $ | - | ||||
| Operating costs and expenses |
(1,104 | ) | (595 | ) | ||||
| Operating loss |
$ | (584 | ) | $ | (595 | ) | ||
Land Development and Sales operating revenues include the sales of our real estate inventory. The increase in our land development and sales revenues and expenses for the year ended December 31, 2024 compared to the year ended December 31, 2023 was attributed to sales of non-strategic remnant real estate inventory and construction revenues and expenses for the Honokeana Homes Temporary Housing Project incurred during the year.
There were no significant real estate development expenditures during the years ended December 31, 2024 and 2023, respectively.
Land Development and Sales activities are cyclical and depend on several factors. Results for one period are therefore not necessarily indicative of future performance trends in this business segment. Prior to the Maui wildfires which occurred on August 8, 2023, there was a shortage of primary housing supply on Maui. While the provision of land to generate primary housing and additional jobs was a priority of ours prior to the wildfires, the loss of over 2,000 homes and over 3,000 jobs in the Lahaina wildfire have accelerated our efforts to get land into productive use to meet these critical needs.
LEASING
| Years Ended |
||||||||
| December 31, |
||||||||
| 2024 |
2023 |
|||||||
| (in thousands) |
||||||||
| Operating revenues |
$ | 9,621 | $ | 8,461 | ||||
| Operating costs and expenses |
(5,006 | ) | (4,420 | ) | ||||
| Operating income |
$ | 4,615 | $ | 4,041 | ||||
Operating revenues from leasing activities for the year ended December 31, 2024, were comprised of $8.0 million from commercial, industrial, and agricultural leases, $0.2 million of licensing fees from our registered trademarks and trade names, $1.1 million from potable and non-potable water system sales and $0.3 million in grant revenue from the State of Hawai‘i for conservation management of our Pu‘u Kukui Watershed, compared to $5.9 million from commercial, industrial, and agricultural leases, $0.8 million of licensing fees from our registered trademarks and trade names, $1.5 million from potable and non-potable water system sales and $0.3 million in grant revenue from the State of Hawai‘i for conservation management of our Pu‘u Kukui Watershed for the year ended December 31, 2023.
Certain rental income is contingent upon the sales of tenants exceeding a defined threshold and recognized as a percentage of sales after those thresholds are achieved. As the COVID-19 pandemic waned, visitor traffic to Maui was increasing and these percentage rents, leasing revenues in general and land licensing from adventure tourism tenants were returning to pre-pandemic levels until August 8, 2023, the date of the devastating Maui wildfires. The wildfires impacted West Maui tourism and reduced percentage rents and licensing revenues for tourism-based tenants. Revenue recognized from percentage rents and land licensing in 2024 amounted to $2.3 million as compared to $2.2 million in 2023, an increase of $0.1 million. Tourist traffic has started increasing again post wildfire, and as a result, it is anticipated that percentage rents will return to pre-wildfire levels in 2025 to 2026.
The increase in leasing operating costs and expenses for the year ended December 31, 2024, compared to the year ended December 31, 2023, was primarily due to higher insurance costs and property maintenance costs for our commercial leasing portfolio properties and the hiring of a property management and leasing firm to grow our leasing portfolio and the associated start-up costs and fees.
Our leasing operations face substantial competition from other property owners in Maui and Hawai‘i.
RESORT AMENITIES
| Years Ended |
||||||||
| December 31, |
||||||||
| 2024 |
2023 |
|||||||
| (in thousands) |
||||||||
| Operating revenues |
$ | 1,424 | $ | 828 | ||||
| Operating costs and expenses |
(1,477 | ) | (1,532 | ) | ||||
| Operating income (loss) |
$ | (53 | ) | $ | (704 | ) | ||
Our Resort Amenities segment includes the operations of the Kapalua Club, a private, non-equity club providing its members special programs, access and other privileges at certain of the amenities at the Kapalua Resort including a 30,000 square foot full-service spa and fitness center, a private pool-side dining beach club, and two 18-hole championship golf courses. The Kapalua Club does not own or operate any resort amenities and the member dues collected are primarily used to pay contracted fees to provide access for its members to the spa, beach club and other resort amenities.
The increase in operating revenues for year ended December 31, 2024, compared to the year ended December 31, 2023, was due to the increase in members in 2024. Following the Maui wildfires on August 8, 2023, the Kapalua Club operations were temporarily closed. Additionally, the Kapalua Club issued refunds of membership fees during a two-month period following the wildfires.
Contracted amenity fees decreased for the year ended December 31, 2024, compared to the year ended December 31, 2023, attributable to a change in policy regarding amenity fees paid for member utilization.
The Club was restructured in 2023 and revised policies and practices were implemented to reduce the impact of the amenity fees and to better match club dues with club expenses. The Club has begun accepting new membership applications beginning late 2023.
OTHER INCOME
Investment income of approximately $0.3 million and $0.5 million was earned from our money market and bond investment portfolio during the years ended December 31, 2024 and 2023, respectively
We also recorded approximately $0.6 million of return of equity from our investment in the BRE2 LLC joint venture during the year ended December 31, 2024. This was due to the sale of a ranch lot from a land development joint venture in Hali‘imaile, based on the gross sales price of $1.8 million for a lot of approximately 6 usable acres resulting in price per usable acre of $0.3 million. In February 2025, the joint venture sold the second and final lot of the subdivision for $2.4 million for a 25-acre parcel with usable acreage of 16 acres resulting in a value of $150,000 per usable acre.
PENSION EXPENSE
The termination notification of the Qualified Plan originally made on August 31, 2023, was amended to November 30, 2023. The change in timing allowed for the Company to issue lump sum distributions in the fourth quarter of 2024 amounting to approximately $1.1 million and final annuitization of plan participants to take place in the first and second quarters of 2025. An estimated settlement charge (non-cash GAAP expense) between $7.0 million to $8.0 million will be recognized at the time of final annuitization and plan termination.
SHARE-BASED COMPENSATION PLANS
The Company accounts for share-based compensation, including grants of restricted shares of common stock and options to purchase common shares, as compensation expense over the respective vesting periods in the consolidated financial statements based on their fair values on the grant dates. The impact of any forfeitures that may occur prior to vesting is estimated and considered in the expense recognized. The increase in share-based compensation expenses were primarily attributed to a $3.5 million increase in non-cash stock compensation costs due to valuation expenses for stock options issued to the directors of the company and the Chief Executive Officer, accelerated vesting expense for option and restricted grants cancelled in August 2024, which amounted to $0.6 million.
INTEREST EXPENSE
There was $3.0 million of borrowings outstanding on our credit facility with a bank at December 31, 2024. There were no borrowings outstanding at December 31, 2023. On December 31, 2024 and 2023, interest rates on our credit facility were 6.375% and 7.38%, respectively. Interest expense paid during the year ended December 31, 2024 equaled approximately $55,000.
LIQUIDITY AND CAPITAL RESOURCES
We had cash on hand of $6.8 million and $5.7 million at December 31, 2024 and 2023, respectively. We hold deposit accounts with several local banks in Hawai‘i. Accounts at each institution are insured by the Federal Deposit Insurance Corporation up to $250,000. We rely on the financial strength and stability of these banks and have no reason to believe that our deposits would be unavailable on demand.
Our investments consisted of corporate bond securities maturing over various dates through the end of 2025. The fair value of our investments was $2.7 million at December 31, 2024. We intend to hold our bond investments until maturity.
We also had $12.0 million and $15.0 million of available credit under a revolving line of credit facility with First Hawaiian Bank (the “Bank”) (the “Credit Facility”) as of December 31, 2024 and 2023, respectively. In 2021, we executed a Fourth Loan Modification Agreement and Second Amended and Restated Credit Agreement (collectively the “Agreements”) extending the maturity date of the Credit Facility to December 31, 2025. The Agreements provide revolving or term loan borrowing options. Interest on revolving borrowing is calculated based on the Bank’s prime rate minus 1.125 percentage points. Interest on term loan borrowing is fixed at the Bank’s commercial loan rates with interest rate swap options available. We have pledged approximately 30,000 square feet of commercial leased space in the Kapalua Resort as security for the Credit Facility. Net proceeds from the sale of any collateral are required to be repaid toward outstanding borrowings and will permanently reduce the Credit Facility’s revolving commitment amount. There are no commitment fees on the unused portion of the Credit Facility. The terms of the Credit Facility include various representations, warranties, affirmative, negative, and financial covenants and events of default customary for financings of this type. Financial covenants include a minimum liquidity (as defined) of $2.0 million, a maximum of $45.0 million in total liabilities, and a limitation on new indebtedness.
We were in compliance with the covenants under the Credit Facility at December 31, 2024.
Cash Flows
Net cash flow provided by (used in) our operating activities totaled $0.4 million and ($1.4) million for the years ended December 31, 2024 and 2023, respectively.
Minimum funding contributions to our defined benefit pension plan were not required during the year ended December 31, 2024 or 2023.
Interest income from our investment portfolio was $0.3 million and $0.5 million during the years ended December 31, 2024 and 2023, respectively. Our bond investments yielded approximately 5.6% and 5.7% in aggregate at December 31, 2024 and 2023, respectively.
Future Cash Inflows and Outflows
In 2023, the Company entered into a joint venture, BRE2 LLC with Stone Properties, a Hawai‘i based LLC to develop and sell ranch lots in Hali‘imaile, Hawai‘i. The first lot sold for $1.8 million in December 2024 and the second lot sold for $2.4 million in February 2025. The Company received a distribution from BRE2 LLC in the amount of $1.0 million in December 2024, the remaining distributions of approximately $1.1 million is expected during 2025 which is comprised of $0.6 million in remaining return of equity and approximately $0.5 million in net profit.
Land development costs to be capitalized are budgeted at $6.0 million for 2025. This includes costs for planning, engineering, permitting, subdivision, and preliminary site improvements on various projects totaling approximately 7,900 acres. These projects include three Kapalua resort projects (Central Resort, Mauka, and Makai) along with farm subdivision projects in Upcountry and West Maui. This investment reflects the expanding volume of active, value-adding projects in the pipeline to create value and meet Maui's need for increased housing inventory, job opportunities, and farms for local food production.
Maintenance and capital improvements on the Company’s commercial assets in the Kapalua Town Center, Alaeloa Business Center and the Hali‘imaile Town Center are budgeted at $0.6 million and $2.8 million will be expended on our water assets and infrastructure which includes our West Maui water wells, Honolua ditch system, Ka‘ili‘ili ditch system in upcountry Maui and our Hali‘imaile Waste Water Treatment system. Budgeted amounts are approximate estimates and can vary significantly based on a number of factors, Costs in excess of billings amounts may materially and adversely affect our operating results, liquidity and financial condition.
Our business initiatives include investing in our operating infrastructure and continued planning and entitlement efforts on our development projects. At times, this may require borrowing under our Credit Facility or other indebtedness, repayment of which may be dependent on selling of our real estate assets at acceptable prices in condensed timeframes. We believe our cash and investment balances, cash provided from ongoing operating activities, and available borrowings under our revolving credit facility, will provide sufficient liquidity to enable us to meet our working capital requirements, contractual obligations, and timely service our debt obligations for the next 12 months and the foreseeable longer term.
Our indebtedness could have the effect of, among other things, increasing our exposure to general adverse economic and industry conditions, limiting our flexibility in planning for, or reacting to, changes in our business and industry, and limiting our ability to borrow additional funds.
CRITICAL ACCOUNTING POLICIES AND ESTIMATES
Our accounting policies are described in Note 1 to our financial statements set forth in Item 8 of this Annual Report. The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires the use of accounting estimates. Some of these estimates and assumptions involve a high level of subjectivity and judgment and therefore the impact of a change in these estimates and assumptions could materially affect the amounts reported in our financial statements. The accounting policies and estimates that we have identified as being critical to our financial statements are as follows:
| • |
Our long-lived assets are reviewed for impairment if events or circumstances indicate that the carrying amount of the long-lived asset may not be recoverable. These asset impairment loss analyses contain uncertainties because they require management to make assumptions and apply considerable judgments to, among others, estimates of the timing and amount of future cash flows, expected useful lives of the assets, uncertainty about future events, including changes in economic conditions, changes in operating performance, changes in the use of the assets, and ongoing costs of maintenance and improvements of the assets; thus, the accounting estimates may change from period to period. If management uses different assumptions or if different conditions occur in future periods, our financial condition or future operating results could be materially impacted. |
| • |
Deferred development costs consist principally of predevelopment and offsite development costs related to various projects in the planning stages by our real estate segment. Based on our future development plans for the Kapalua Resort and other properties, and the estimated value of these future projects, we have concluded that our deferred development costs will be recoverable from our future development projects. Our assumptions and estimates could be subject to significant change because of the long-term nature of our development plans and the uncertainty of when or if certain projects will be developed. |
| • |
Assets are classified as held for sale when (i) management approves and commits to a plan to sell the property; (ii) the property is available for immediate sale in its present condition, subject only to terms that are usual and customary; (iii) an active program to locate a buyer and other actions required to complete the plan to sell have been initiated; (iv) the sale of the property is probable and is expected to be completed within one year; (v) the property is being actively marketed for sale at a price that is reasonable in relation to its current fair value; and (vi) actions necessary to complete the plan of sale indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. Assets held for sale are stated at the lower of net book value or estimated fair value less cost to sell. |
| • |
Held-to-maturity debt securities are stated at amortized cost. Investments are reviewed for impairment by management on a periodic basis. If any impairment is considered other-than-temporary, the security is written down to its fair value and a corresponding loss recorded as a component of other income (expense). Management measures expected credit losses on held-to-maturity debt securities on a collective basis by major type. If there are anticipated credit losses a reserve for credit losses will be established and held to debt maturities will be presented net of the allowance. There were no accrued interest receivable on held-to-maturity debt securities at December 31, 2024. |
| • |
Sales of real estate assets that are considered central to our ongoing major operations are classified as real estate sales revenue, along with any associated cost of sales, in our consolidated statements of operations. Sales of real estate assets that are considered peripheral or incidental transactions to our ongoing major or central operations are reflected as net gains or losses in our consolidated statements of operations. |
| • |
If the sale of a real estate asset represents a strategic shift that has, or will have, a major effect on our operations, such as the discontinuance of a business segment, then the operations of the property, including any interest expense directly attributable to it, are classified as discontinued operations, and amounts for all prior periods presented are reclassified from continuing operations to discontinued operations. The disposal of an individual property generally will not represent a strategic shift and, therefore, will typically not meet the criteria for classification as discontinued operations. Real estate assets that would be considered for sale are remnant parcels that are not part of existing strategic development plans and projects. |
| • |
Determining pension expense and obligations for our defined benefit pension plan utilizes actuarial estimates of participants’ age at retirement, life span, the long-term rate of return on investments and other factors. In addition, pension expense is sensitive to the discount rate utilized to value the pension obligation. These assumptions are subject to the risk of change as they require significant judgment and have inherent uncertainties that management or its consulting actuaries may not control or anticipate. A detailed discussion of our defined benefit pension plans is contained in Note 7 to our financial statements set forth in Item 8 of this Annual Report. |
| • |
Stock options were issued to the Chairperson of the Board, members of the Board, and the Chief Executive Officer. With the option issuances, management engages with a certified valuation company to perform the valuation analysis and calculations based on option terms, number of shares issued, issuance share price, volatility, risk and historical trends with the options issuances. The valuation expense is reviewed and approved by the Company’s Audit Committee and valuation expenses are recognized over the duration of the exercisable period of the issuances. For cancellations of options, the remaining unvested option valuation expense will be accelerated and expensed immediately upon the option cancellation date. |
| • |
Management calculates the income tax provision, current and deferred income taxes, and tax credits along with the valuation allowance based upon various complex estimates and interpretations of income tax laws and regulations. Deferred tax assets and tax credits are reduced by a valuation allowance to the extent that it is more likely than not that they will not be realized. To the extent we begin to generate taxable income in future years, and it is determined the valuation allowance is no longer required, the tax benefit for the remaining deferred tax assets and tax credits will be recognized at such time. A detailed discussion of our income taxes is contained in Note 12 to our financial statements set forth in Item 8 of this Annual Report. |
| • |
Our results of operations could be affected by significant litigation or contingencies adverse to the Company, including, but not limited to, liability claims, environmental matters, and contract terminations. We record accruals for legal matters when the information available indicates that it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. We make adjustments to these accruals to reflect the impact and status of negotiations, settlements, rulings, advice of legal counsel and other information and events that may pertain to a particular matter. Predicting the outcome of claims and lawsuits and estimating related costs and exposure involves substantial uncertainties that could cause actual costs to vary materially from those estimates. In making determinations of likely outcomes of litigation matters, we consider many factors. These factors include, but are not limited to, the nature of specific claims, our experience with similar types of claims, the jurisdiction in which the matter is filed, input from outside legal counsel, the likelihood of resolving the matter through alternative dispute resolution mechanisms and the matter’s current status. A detailed discussion of significant litigation matters and contingencies is contained in Note 9 to our financial statements set forth in Item 8 of this Annual Report. |
| • |
The construction contract for the Honokeana Homes Temporary Housing Project follows the cost to cost accounting method. Contracting revenues and expenses are proportionately recognized based on actual costs incurred in relation to reliable and updated estimates of the cost to complete the project. Project billings in excess of recognized revenues are recognized as Billings in Excess of Revenues (a deferred revenue account) and where project costs are recognized in excess of project billings, this is recognized as Contract overbillings (a deferred expense account). |
IMPACT OF INFLATION AND CHANGING PRICES
Most land holdings we own were acquired from 1911 to 1932 and are carried at cost. At the Kapalua Resort, some of the fixed assets were constructed and placed in service in the mid-to-late 1970’s. Depreciation expense would be considerably higher if fixed assets were stated at current replacement cost.
OFF-BALANCE SHEET ARRANGEMENTS
As of December 31, 2024, we did not have any significant off-balance sheet arrangements, as defined in Item 303(a)(4)(ii) of Regulation S-K.
| QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
We are a smaller reporting company, as defined in Item 10(f)(1) of Regulation S-K and are not required to provide the information required by this Item.
| FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders of
Maui Land & Pineapple Company, Inc.
Opinion on the Consolidated Financial Statements
We have audited the accompanying consolidated balance sheets of Maui Land & Pineapple Company, Inc. and its Subsidiaries (collectively, the “Company”) as of December 31, 2024 and 2023, and the related consolidated statements of operations and comprehensive loss, changes in stockholders’ equity, and cash flows for each of the years in the two‑year period ended December 31, 2024 and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2024 and 2023, and the results of their operations and their cash flows for each of the years in the two‑year period ended December 31, 2024 in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
The consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the U.S. Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the accounts or disclosures to which they relate.
Revenue Recognition for Honokeana Temporary Housing Project
Description of the Matter
The Company entered into a Memorandum of Agreement with the State of Hawaii, Department of Transportation to lease land and administer the construction of improvements necessary to support temporary homes for individuals and families displaced by the Maui wildfires on August 8, 2023.
The Company recognizes the contract revenue over time, as performance obligations are satisfied, using the cost-to-cost method (an input method) based on contract costs incurred to date compared to total estimated contract cost. Revenue recognition under this method is judgmental, as it requires the Company to prepare estimates of total contract revenue and total contract costs, including costs to complete the in-process contract.
Management exercised judgment at the inception of the agreement to determine the appropriate accounting treatment of the transaction. This included deciding on the appropriate revenue recognition for this customer agreement, which involved the following considerations:
| ● | Determination of whether the agreement entered into by the Company was a contract with a customer that would be assessed under Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers. |
| ● | Determination of whether there was a single or multiple, distinct performance obligation for goods or services to be provided. |
| ● | Determination of the transaction price for each distinct performance obligation. |
| ● | Determination of the allocated transaction price to the performance obligations in the contract. |
| ● | Determination of the timing of when the Company satisfies a performance obligation and amount of revenue to recognize. |
Given the factors, the related audit effort in evaluating management’s judgments in determining the appropriate revenue recognition for this customer contract was extensive and involved subjective judgments.
How We Addressed the Matter in Our Audit
Our audit procedures over revenue recognition and disclosures included the following:
| ● | We obtained an understanding and evaluated the design and implementation of internal controls that address the risks of material misstatement relating to revenue recognized for the Honokeana Temporary Housing Project. |
| ● | We obtained and reviewed the Honokeana Temporary Housing Project agreement; evaluated management’s considerations used to identify the performance obligations and transaction prices for each distinct performance obligation, identify unique contract terms that may impact the timing and amount of revenue recognized, and identify the pattern of delivery; and examined the appropriateness of management’s application of accounting policies in accordance with ASC Topic 606. |
| ● | We tested management’s analysis by evaluating the reasonableness of the Company’s estimated project costs, costs incurred to date, and transaction price. |
/s/
We have served as the Company’s auditor since 2014.
March 31, 2025
MAUI LAND & PINEAPPLE COMPANY, INC. & SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
| December 31, 2024 | December 31, 2023 | |||||||
| (in thousands except share data) | ||||||||
| ASSETS | ||||||||
| CURRENT ASSETS | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Accounts receivable, net | ||||||||
| Investments, current portion | ||||||||
| Prepaid expenses and other assets | ||||||||
| Assets held for sale | ||||||||
| Total current assets | ||||||||
| PROPERTY & EQUIPMENT, NET | ||||||||
| OTHER ASSETS | ||||||||
| Investments, noncurrent portion | ||||||||
| Investment in unconsolidated joint venture | ||||||||
| Deferred development costs | ||||||||
| Other noncurrent assets | ||||||||
| Total other assets | ||||||||
| TOTAL ASSETS | $ | $ | ||||||
| LIABILITIES & STOCKHOLDERS' EQUITY | ||||||||
| LIABILITIES | ||||||||
| CURRENT LIABILITIES | ||||||||
| Accounts payable | $ | $ | ||||||
| Payroll and employee benefits | ||||||||
| Accrued retirement benefits, current portion | ||||||||
| Deferred revenue, current portion | ||||||||
| Long-term debt, current portion | ||||||||
| Line of credit | ||||||||
| Other current liabilities | ||||||||
| Contract overbillings | ||||||||
| Total current liabilities | ||||||||
| LONG-TERM LIABILITIES | ||||||||
| Accrued retirement benefits, noncurrent portion | ||||||||
| Deferred revenue, noncurrent portion | ||||||||
| Deposits | ||||||||
| Long-term debt, noncurrent portion | ||||||||
| Other noncurrent liabilities | ||||||||
| Total long-term liabilities | ||||||||
| TOTAL LIABILITIES | ||||||||
| COMMITMENTS AND CONTINGENCIES | ||||||||
| STOCKHOLDERS' EQUITY | ||||||||
| Preferred stock--$ par value; shares authorized; shares issued and outstanding | ||||||||
| Common stock--$ par value; shares authorized; and shares issued and outstanding at December 31, 2024 and December 31, 2023, respectively | ||||||||
| Additional paid-in-capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Accumulated other comprehensive loss | ( | ) | ( | ) | ||||
| Total stockholders' equity | ||||||||
| TOTAL LIABILITIES & STOCKHOLDERS' EQUITY | $ | $ | ||||||
See Notes to Consolidated Financial Statements
MAUI LAND & PINEAPPLE COMPANY, INC. & SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE LOSS
| Years Ended | ||||||||
| 2024 | 2023 | |||||||
| (in thousands except | ||||||||
| per share amounts) | ||||||||
| OPERATING REVENUES | ||||||||
| Land development and sales | $ | $ | ||||||
| Leasing | ||||||||
| Resort amenities and other | ||||||||
| Total operating revenues | ||||||||
| OPERATING COSTS AND EXPENSES | ||||||||
| Land development and sales | ||||||||
| Leasing | ||||||||
| Resort amenities and other | ||||||||
| General and administrative | ||||||||
| Share-based compensation | ||||||||
| Depreciation | ||||||||
| Total operating costs and expenses | ||||||||
| OPERATING LOSS | ( | ) | ( | ) | ||||
| Gain from derecognition of nonfinancial asset | ||||||||
| Gain on assets disposal | ||||||||
| Other income | ||||||||
| Pension and other post-retirement expenses | ( | ) | ( | ) | ||||
| Interest expense | ( | ) | ( | ) | ||||
| NET LOSS | $ | ( | ) | $ | ( | ) | ||
| Other comprehensive income - pension, net | ||||||||
| TOTAL COMPREHENSIVE LOSS | $ | ( | ) | $ | ( | ) | ||
| NET LOSS PER COMMON SHARE-BASIC | $ | ( | ) | $ | ( | ) | ||
| NET LOSS PER COMMON SHARE-DILUTED | $ | ( | ) | $ | ( | ) | ||
See Notes to Consolidated Financial Statements
MAUI LAND & PINEAPPLE COMPANY, INC. & SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
For the Years Ended December 31, 2024 and 2023
(in thousands)
| Accumulated | ||||||||||||||||||||||||
| Additional | Other | |||||||||||||||||||||||
| Common Stock | Paid in | Accumulated | Comprehensive | |||||||||||||||||||||
| Shares | Amount | Capital | Deficit | Loss | Total | |||||||||||||||||||
| Balance, December 31, 2022 | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||
| Share-based compensation expense | - | |||||||||||||||||||||||
| Issuance of shares for incentive plan | ||||||||||||||||||||||||
| Vested restricted stock issued | ( | ) | ||||||||||||||||||||||
| Shares cancelled to pay tax liability | ( | ) | ( | ) | ( | ) | ||||||||||||||||||
| Other comprehensive income - pension | - | |||||||||||||||||||||||
| Net loss | - | ( | ) | ( | ) | |||||||||||||||||||
| Balance December 31, 2023 | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||
| Share-based compensation | - | |||||||||||||||||||||||
| Issuance of shares for incentive plan | ||||||||||||||||||||||||
| Restricted stock and options cancellation | - | |||||||||||||||||||||||
| Vested restricted stock issued | ( | ) | ||||||||||||||||||||||
| Shares cancelled to pay tax liability | ( | ) | ( | ) | ( | ) | ||||||||||||||||||
| Other comprehensive income - pension | - | |||||||||||||||||||||||
| Net loss | - | ( | ) | ( | ) | |||||||||||||||||||
| Balance, December 31, 2024 | ( | ) | ( | ) | ||||||||||||||||||||
See Notes to Consolidated Financial Statements
MAUI LAND & PINEAPPLE COMPANY, INC. & SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
| Years Ended | ||||||||
| 2024 | 2023 | |||||||
| (in thousands) | ||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||
| Cash receipts from customers and other receipts | $ | $ | ||||||
| Cash paid to vendors | ( | ) | ( | ) | ||||
| Cash paid for payroll and taxes | ( | ) | ( | ) | ||||
| NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | ( | ) | ||||||
| CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||
| Purchases of bond securities | ( | ) | ( | ) | ||||
| Maturities of bond securities | ||||||||
| Distribution from unconsolidated joint venture | ||||||||
| Purchases of property and equipment | ( | ) | ( | ) | ||||
| Payments for deferred development | ( | ) | ||||||
| Contribution to unconsolidated joint venture | ( | ) | ||||||
| Payments for other assets | ( | ) | ||||||
| NET CASH USED IN INVESTING ACTIVITIES | ( | ) | ( | ) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
| Borrowing under line of credit | ||||||||
| Principal payments on long term debt | ( | ) | ||||||
| Common stock issuance costs and other | ( | ) | ( | ) | ||||
| NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES | ( | ) | ||||||
| NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | ( | ) | ||||||
| CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | ||||||||
| CASH AND CASH EQUIVALENTS AT END OF PERIOD | $ | $ | ||||||
| RECONCILIATION OF NET LOSS TO NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITES: | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash provided by | ||||||||
| (used in) operating activities: | ||||||||
| Depreciation and amortization | ||||||||
| Provision for credit losses | ||||||||
| Share-based compensation | ||||||||
| (Gain) loss on disposal of property | ( | ) | ||||||
| Debt financed equipment | ||||||||
| Revenue from investment in unconsolidated joint venture | ( | ) | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | ( | ) | ( | ) | ||||
| Retirement liabilities | ||||||||
| Accounts payable | ||||||||
| Deferred revenue | ||||||||
| Contract overbilling | ||||||||
| Other operating assets and liabilities | ( | ) | ( | ) | ||||
| NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | $ | $ | ( | ) | ||||
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
| • | Common stock issued to certain members of the Company’s management totaled $ |
| • | The Company had a $ |
| • | The Company had $ |
| • | The Company's financed lease liabilities for equipment were $ |
See Notes to Consolidated Financial Statements.
MAUI LAND & PINEAPPLE COMPANY, INC. & SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Years Ended December 31, 2024 and 2023
| 1. | DESCRIPTION OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES |
DESCRIPTION OF BUSINESS
Maui Land & Pineapple Company, Inc. is a Delaware corporation and the successor to a business organized in 1909 as a Hawaii corporation. The Company reincorporated from Hawaii to Delaware pursuant to a plan of conversion completed on July 18, 2022. Total authorized capital stock of the Company includes
| Land Development & Sales: | Our real estate operations consist of land planning and entitlement, development, and sales activities. | |
| Leasing: | Our leasing operations include commercial, agricultural, and industrial land and property leases, licensing of our registered trademarks and trade names, management of potable and non-potable water systems in West and Upcountry Maui, and stewardship of conservation areas. | |
| Resort Amenities: | The resort amenities operations include the operations of the Kapalua Club, a private, non-equity club program, providing its members special programs, access, and other privileges at certain amenities at the Kapalua Resort. |
BASIS OF ACCOUNTING AND CONSOLIDATION
The accompanying consolidated financial statements of the Company are presented in conformity with generally accepted accounting principles in the United States of America (“GAAP”) as codified by the Financial Accounting Standards Board (“FASB”). The consolidated financial statements include the accounts of Maui Land & Pineapple Company, Inc. and its subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents include cash on hand, deposits in banks, and money market funds.
ACCOUNTS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES
Receivables are recorded net of an allowance for credit losses. The Company estimates future write-offs based on delinquencies, credit ratings, aging trends, and historical experience. The Company believes the allowance for credit losses is adequate to cover anticipated losses; however, significant deterioration in any of the aforementioned factors or in general economic conditions could change these expectations, and accordingly, the Company’s consolidated financial condition and/or its future operating results could be materially impacted. Credit is extended after evaluating creditworthiness and no collateral is generally required from customers.
INVESTMENT IN BOND SECURITIES
Held-to-maturity debt securities are stated at amortized cost. Investments are reviewed for impairment for each reporting period. If any impairment is considered other-than-temporary, an allowance for credit losses would be established and held-to-maturity debt securities would be presented net of the allowance for credit losses. Adjustments to expected credit losses are recorded as a component of other income (expense).
ASSETS HELD FOR SALE
Assets are classified as held for sale when management approves and commits to a plan to sell the property; the property is available for immediate sale in its present condition, subject only to terms that are usual and customary; an active program to locate a buyer and other actions required to complete the plan to sell have been initiated; the sale of the property is probable and is expected to be completed within one year; the property is being actively marketed for sale at a price that is reasonable in relation to its current fair value; and actions necessary to complete the plan of sale indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. Assets held for sale are stated at the lower of net book value or estimated fair value less cost to sell. There were
DEFERRED DEVELOPMENT COSTS
Deferred development costs consist primarily of design, entitlement and permitting fees and real estate development costs related to various planned projects. Deferred development costs are written off if management decides that it is no longer probable that the Company will proceed with the related development project. There were
INVESTMENT IN JOINT VENTURES
Investments in joint ventures in which we have less than a controlling financial interest are accounted for under the equity method of accounting. The initial capital contribution of assets to a joint venture is recorded at fair value.
PROPERTY & EQUIPMENT AND DEPRECIATION
Property is stated at cost. Major replacements, renewals and betterments are capitalized while maintenance and repairs that do not improve or extend the life of an asset are charged to expense as incurred. When property is retired or otherwise disposed of, the cost of the property and the related accumulated depreciation are written off and the resulting gains or losses are included in income. Depreciation is provided over the estimated useful lives of the respective assets using the straight-line method generally over to
LONG-LIVED ASSETS
Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When such events or changes occur, an estimate of the future undiscounted cash flows expected to result from the use of the assets and their eventual disposition is made. If the sum of such expected future cash flows (undiscounted and without interest charges) is less than the carrying amount of the asset, an impairment loss is recognized in an amount by which the assets’ net book values exceed their fair value. These asset impairment loss analyses require management to make assumptions and apply considerable judgments regarding, among others, estimates of the timing and amount of future cash flows, expected useful lives of the assets, uncertainty about future events, including changes in economic conditions, changes in operating performance, changes in the use of the assets, and ongoing cost of maintenance and improvements of the assets, and thus, the accounting estimates may change from period to period. If management uses different assumptions or if different conditions occur in future periods, the Company’s consolidated financial condition or its future operating results could be materially impacted.
There was
ACCRUED RETIREMENT BENEFITS
The Company’s policy is to fund retirement benefit costs at a level at least equal to the minimum funding requirements under federal law, but not more than the maximum amount deductible for federal income tax purposes.
The funded status of the Company’s defined benefit pension plan is recorded as an asset or liability in the consolidated balance sheet reflecting the difference between the fair value of plan assets and the projected benefit obligation. Changes in the funded status of the plan are recorded in the year in which the changes occur, through comprehensive income.
Deferred compensation plans for certain former management employees provide for specified payments after retirement. A liability has been recognized based on the present value of estimated payments to be made.
REVENUE RECOGNITION
The Company recognizes revenue to represent the transfer of goods and services to customers in an amount that reflects the consideration to which the Company expects to be entitled in such exchange. This requires the Company to identify contractual performance obligations and determine whether revenue should be recognized at a point in time or over time, based on when control of goods and services transfers to a customer. Operating results pertaining to the Company’s business segments are summarized in Note 13 to the consolidated financial statements.
A customer is distinguished from a noncustomer by the nature of the goods or services that are transferred. Customers are provided with goods or services that are generated by a company’s ordinary output activities, whereas noncustomers are provided with nonfinancial assets that are outside of a company’s ordinary output activities. This distinction may not significantly change the pattern of income recognition but determines whether that income is classified as revenue (contracts with customers) or other gains/losses (contracts with noncustomers) in the Company’s consolidated financial statements. The Company’s revenue streams for the period were generated as ordinary output activities to customers as defined by the guidance and were properly classified as revenues.
The Company uses the five-step model to recognize revenue from customer contracts. The five-step model requires the Company (i) identify the contract with the customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, including variable consideration to the extent that it is probable that a significant future reversal will not occur, (iv) allocate the transaction price to the respective performance obligations in the contract, and (v) recognize revenue when (or as) the Company satisfies the performance obligation.
For each contract that involves variable consideration, the transaction price of the contract is considered the most likely outcome in estimating possible consideration amounts. The information used to determine the transaction price is similar to the information used in establishing prices of goods or services.
The Company is also required to determine if it controls the goods or services prior to the transfer to the customer in order to determine if it should account for the arrangement as a principal or agent. Principal arrangements, where the Company controls the goods or services provided, will result in the recognition of the gross amount of consideration expected in the exchange. Agent arrangements, where the Company simply arranges but does not control the goods or services being transferred to the customer, will result in the recognition of the net amount the Company is entitled to retain in the exchange.
Revenues from the Company’s land development and sales segment consist of sales of real estate. Revenues from sales of real estate are recognized in the period in which sufficient cash has been received, collection of the balance is reasonably assured, performance obligations have been performed and risks of ownership have passed to the buyer.
Sales of real estate assets that are considered central to the Company’s ongoing major operations are classified as real estate sales revenue, along with any associated cost of sales, in the Company’s consolidated statements of operations and comprehensive income (loss). Sales of real estate assets that are considered peripheral or incidental transactions to the Company’s ongoing major or central operations are reflected as net gains or losses in the Company’s consolidated statements of operations and comprehensive income (loss).
The construction contract for the Honokeana Homes Temporary Housing Project follows the cost to cost accounting method. Contracting revenues and expenses are proportionately recognized based on actual costs incurred in relation to reliable and updated estimates of the cost to complete the project. Project billings in excess of recognized revenues are recognized as Billings in Excess of Revenues (a deferred revenue account) and where project costs are recognized in excess of project billings, this is recognized as Costs in Excess of Billings (a deferred expense account).
Leasing revenues are recognized on a straight-line basis over the terms of the leases. Lease income may include certain percentage rents determined in accordance with the terms of the leases. Lease income arising from rents that are contingent upon the sales of the tenant exceeding a defined threshold are recognized only after the defined sales thresholds are achieved. Reimbursements received for real estate taxes, general excise taxes, insurance and common area maintenance expenses are recognized as revenue as provided in the underlying lease terms.
The Company elected the following practical expedients upon adoption of ASC Topic 842 on January 1, 2019:
| ● | Single component practical expedient – requires the Company to account for lease and non-lease components associated with that lease, if certain criteria are met. |
| ● | Short-term leases practical expedient – for operating leases with a term of 12 months or less in which the Company is the lessee, this expedient allows the Company to not record on its balance sheets the related lease liabilities, taxes collected from lessees, lessor costs paid directly by lessee to a third party and right-of-use assets. |
Included in leasing revenues are grants issued by the State of Hawai‘i to subsidize the conservation and preservation efforts of the Pu‘u Kukui Watershed Preserve (“PKW”). The PKW is approximately
Revenue from resort amenities consist of annual dues received from the Kapalua Club membership program. Member services include access, special programs, and other privileges at certain of the amenities at the Kapalua Resort. Annual membership dues are recognized on a straight-line basis over one year. Performance obligations for services are satisfied by relying on information received from the Company’s employees and vendors who have rendered services in accordance with the terms and conditions of the membership program.
The Company estimates expected credit losses on accounts receivable from customers by considering relevant information (past, current, and future) in assessing the collectability of cash flows. The expected credit losses of the Company’s accounts receivable are summarized in Note 14 to the consolidated financial statements.
Economic factors affecting the nature, amount, timing, and uncertainty of the Company’s revenue and cash flows are identified as Risks and Uncertainties in this Note 1.
OPERATING COSTS AND EXPENSES
Land development and sales, leasing, resort amenities, and general and administrative costs and expenses are reflected exclusive of depreciation and pension and other post-retirement expenses.
SHARE-BASED COMPENSATION PLANS
The Company accounts for share-based compensation, including grants of restricted shares of common stock and options to purchase common shares, as compensation expense over the respective vesting periods in the consolidated financial statements based on their fair values on the grant dates. The impact of forfeitures that may occur prior to vesting is estimated and considered in the expense recognized.
INCOME TAXES
The Company accounts for uncertain tax positions using a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return.
The Company’s provision for income taxes is calculated using the liability method. Deferred income taxes are provided for all temporary differences between the financial statement and income tax bases of assets and liabilities using tax rates enacted by law or regulation. A valuation allowance is established for deferred income tax assets if management believes that it is more likely than not that some portion or all of the asset will not be realized through future taxable income.
The Company recognizes accrued interest related to unrecognized tax benefits as interest expense and penalties in general and administrative expenses in its consolidated statements of operations and comprehensive income (loss) and such amounts are included in income taxes payable on the Company’s consolidated balance sheets.
COMPREHENSIVE INCOME (LOSS)
Comprehensive income (loss) includes all changes in stockholders’ equity, except those resulting from capital stock transactions. Comprehensive income (loss) also includes adjustments to the Company’s defined benefit pension plan obligations.
INCOME (LOSS) PER COMMON SHARE
Basic net income (loss) per common share is computed by dividing net income (loss) by the weighted-average number of common shares outstanding. Diluted net income per common share is computed similar to basic net income (loss) per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if dilutive potential common shares from share-based compensation arrangements had been issued. Potentially dilutive shares from stock option grants to purchase common shares and non-vested restricted stock are determined using the treasury stock method. Basic weighted-average common shares outstanding at December 31, 2024 and 2023 were
FAIR VALUE MEASUREMENTS
GAAP establishes a framework for measuring fair value and requires certain disclosures about fair value measurements to enable the reader of the consolidated financial statements to assess the inputs used to develop those measurements by establishing a hierarchy for ranking the quality and reliability of the information used to determine fair values. GAAP requires that financial assets and liabilities be classified and disclosed in one of the following three categories:
Level 1: Quoted market prices in active markets for identical assets or liabilities.
Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data.
Level 3: Unobservable inputs that are not corroborated by market data.
The Company considers cash and cash equivalents to be unrestricted for purposes of the consolidated balance sheets and consolidated statements of cash flows. The fair value of receivables and payables approximate their carrying value due to the short-term nature of the instruments. The valuation is based on settlements of similar financial instruments all of which are short-term in nature and are generally settled at or near cost.
USE OF ESTIMATES
The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and 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 periods. Future actual amounts could differ from these estimates.
CONCENTRATION OF CREDIT RISK
Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash deposits. Accounts at each institution are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000 per institution. The Company had deposits in excess of the FDIC limit at December 31, 2024 and 2023. No losses have been recognized in 2024 or 2023.
RISKS AND UNCERTAINTIES
Factors that could adversely impact the Company’s future operations or financial results include, but are not limited to the following: periods of economic weakness and uncertainty in Hawai‘i and the mainland United States; high unemployment rates and low consumer confidence; uncertainties and changes in U.S. social, political, regulatory and economic conditions or laws and policies and concerns surrounding ongoing developments in the European Union, Middle East, and Asia; the general availability of mortgage financing, including the effect of more stringent lending standards for mortgages and perceived or actual changes in interest rates; risks related to the Company’s investments in real property, the value and salability of which could be impacted by the economic factors discussed above or other factors; the popularity of Maui in particular and Hawai‘i in general as a vacation destination or second-home market; increased energy costs, including fuel costs, which affect tourism on Maui and Hawai‘i generally; untimely completion of land development projects within forecasted time and budget expectations; inability to obtain land use entitlements at a reasonable cost or in a timely manner; unfavorable legislative decisions by state and local governmental agencies; impact of governmental fines and assessments; the cyclical market demand for luxury real estate on Maui and in Hawai‘i generally; increased competition from other luxury real estate developers on Maui and in Hawai‘i generally; failure of future joint venture partners to perform in accordance with their contractual agreements; environmental regulations; acts of God, such as tsunamis, hurricanes, earthquakes and other natural disasters, such as the recent Maui wildfires; the spread of contagious diseases, such as the Coronavirus; the Company’s location apart from the mainland United States, which results in the Company’s financial performance being more sensitive to the aforementioned economic risks; failure to comply with restrictive financial covenants in the Company’s credit arrangements; and an inability to achieve the Company’s short and long-term goals and cash flow requirements.
LEGAL CONTINGENCIES
The Company is party to claims and lawsuits as well as threatened or potential actions or claims concerning matters arising from the conduct of its business activities. The outcome of claims or litigation and the timing of ultimate resolution are inherently difficult to predict and significant judgment may be required in the determination of both the probability of loss and whether the amount of the loss is reasonably estimable. The Company’s estimates are subjective and are based on the status of legal and regulatory proceedings, the merit of the Company’s defenses and consultation with external legal counsel. An accrual for a potential litigation loss is established when information related to the loss contingency indicates both that a loss is probable and that the amount of loss can be reasonably estimated. Refer to Note 9 to the consolidated financial statements for further information regarding the Company’s legal proceedings.
NEW ACCOUNTING STANDARD ADOPTED
In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280), which requires public entities to disclose information about their reportable segments’ significant expenses and other segment items on an interim and annual basis. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024. We have adopted this guidance, which resulted in modifications to our reportable segment disclosures, which can be found in Note 13 to our consolidated financial statements.
NEW ACCOUNTING STANDARDS ISSUED
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740), which requires public entities to provide disclosure of specific categories in the rate reconciliation, as well as disclosure of income taxes paid disaggregated by jurisdiction on an annual basis. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2023-09.
In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Topic 220), which requires public entities to disclose information about purchases of inventory, employee compensation, depreciation, intangible asset amortization, and depletion for each income statement line item that contains those expenses. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026 and interim periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2024-03.
| 2. | INVESTMENTS IN BOND SECURITIES |
Amortized cost and fair value of debt securities at December 31, 2024 and 2023 consisted of the following:
| December 31, | December 31, | |||||||
| 2024 | 2023 | |||||||
| (in thousands) | ||||||||
| Amortized cost | $ | $ | ||||||
| Unrealized gains | ||||||||
| Fair value | $ | $ | ||||||
Maturities of debt securities at December 31, 2024 and 2023 were as follows:
| December 31, 2024 | December 31, 2023 | |||||||||||||||
| (in thousands) | ||||||||||||||||
| Amortized Cost | Fair Value | Amortized Cost | Fair Value | |||||||||||||
| One year or less | $ | $ | $ | $ | ||||||||||||
| Greater than one year through five years | ||||||||||||||||
| $ | $ | $ | $ | |||||||||||||
The fair value of debt securities were measured using Level 1 inputs which are based on quotes for trades occurring in active markets for identical assets.
| 3. | ASSETS HELD FOR SALE |
Assets held for sale consist of non-strategic land parcels identified for sale at December 31, 2024. There are twelve parcels that total in excess of 373 acres, and carry a historical cost basis of approximately $
| 4. | PROPERTY & EQUIPMENT |
Property and equipment at December 31, 2024 and 2023 consist of the following:
| December 31, | December 31, | |||||||
| 2024 | 2023 | |||||||
| (in thousands) | ||||||||
| Land | $ | $ | ||||||
| Land improvements | ||||||||
| Buildings | ||||||||
| Machinery and equipment | ||||||||
| Construction in progress | ||||||||
| Total property and equipment | ||||||||
| Less accumulated depreciation | ( | ) | ( | ) | ||||
| Property and equipment, net | $ | $ | ||||||
Land
Most of the Company’s
Land Improvements
Land improvements are comprised primarily of roads, utilities, and landscaping infrastructure improvements at the Kapalua Resort. Also included is the Company’s potable and non-potable water systems in West Maui. Majority of the Company’s land improvements were constructed and placed in service in the mid-to-late 1970’s or conveyed in 2017. Depreciation expense would be considerably higher if these assets were stated at current replacement cost.
Buildings
Buildings are comprised of restaurant, retail and light industrial spaces located at the Kapalua Resort and Hali’imaile which are used in the Company’s leasing operations. Most of the Company’s buildings were constructed and placed in service in the mid-to-late 1970s. Depreciation expense would be considerably higher if these assets were stated at current replacement cost.
Machinery and Equipment
Machinery and equipment are mainly comprised of zipline course equipment installed in 2008 at the Kapalua Resort and used in the Company’s leasing operations.
| 5. | INVESTMENT IN UNCONSOLIDATED JOINT VENTURE |
In December 2023, the Company entered into a joint venture agreement with a local developer to form a Hawai‘i limited liability company ("BRE2 LLC"). The Company's initial capital contribution to BRE2 LLC consisted approximately
| 6. | LONG-TERM DEBT |
On December 23, 2021, the Company executed a Fourth Loan Modification Agreement and Second Amended and Restated Credit Agreement (“Agreements”) extending the maturity date of the $
At December 31, 2024, $
The terms of the Credit Facility include various representations, warranties, affirmative, negative and financial covenants and events of default customary for financings of this type. Financial covenants include a minimum liquidity (as defined) of $
The Company was in compliance with the covenants under the Credit Facility as of December 31, 2024.
In July 2024 the Company took out a loan to finance equipment purchases. The loan carried a principal amount of $
At December 31, 2024, long-term debt principal payments and imputed interest on this 0% loan for the next years to maturity are as follows:
| Years ending December 31, | ||||
| 2025 | $ | |||
| 2026 | ||||
| 2027 | ||||
| 2028 | ||||
| 7. | ACCRUED RETIREMENT BENEFITS |
Accrued retirement benefits at December 31, 2024 and 2023 consisted of the following:
| December 31, | December 31, | |||||||
| 2024 | 2023 | |||||||
| (in thousands) | ||||||||
| Defined benefit pension plan | $ | $ | ( | ) | ||||
| Non-qualified retirement plans | ||||||||
| Total | ||||||||
| Less current portion | ( | ) | ( | ) | ||||
| Non-current portion of accrued retirement benefits | $ | $ | ||||||
The Company had two defined benefit pension plans which covered substantially all former bargaining and non-bargaining full-time, part-time and intermittent employees. In 2011, pension benefits under both plans were frozen. The Company merged the two defined benefit pension plans to streamline the administration of the frozen plan in 2018. The Company also has an unfunded non-qualified retirement plan covering nine of its former employees. The non-qualified retirement plan was frozen in 2009 and future vesting of additional benefits was discontinued.
The measurement date for the Company’s benefit plan disclosures is December 31 of each year. The changes in benefit obligations and plan assets for the years ended December 31, 2024 and 2023, and the funded status of the plans and assumptions used to determine benefit information at December 31, 2024 and 2023 were as follows:
| Years Ended December 31, | ||||||||
| 2024 | 2023 | |||||||
| (in thousands) | ||||||||
| Change in benefit obligations: | ||||||||
| Benefit obligations at beginning of year | $ | $ | ||||||
|
| ||||||||
| Actuarial gain | ( | ) | ( | ) | ||||
| Benefits paid | ( | ) | ( | ) | ||||
| Benefit obligations at end of year | ||||||||
| Change in plan assets: | ||||||||
| Fair value of plan assets at beginning of year | ( | ) | ||||||
| Actual return on plan assets | ||||||||
| Employer contributions | ( | ) | ( | ) | ||||
| Benefits paid | ||||||||
| Fair value of plan assets at end of year | ||||||||
| Funded status | $ | ( | ) | $ | ( | ) | ||
| Accumulated benefit obligations | $ | ( | ) | $ | ( | ) | ||
| Weighted average assumptions to determine benefit obligations: | ||||||||
| Discount rate | 5.40 - 5.52 | % | 4.90 - 4.95 | % | ||||
| Expected long-term return on plan assets | % | % | ||||||
| Rate of compensation increase | n/a | n/a | ||||||
Accumulated other comprehensive loss of $
Components of net periodic benefit cost and other amounts recognized in comprehensive income were as follows:
| Years Ended December 31, | ||||||||
| 2024 | 2023 | |||||||
| (in thousands) | ||||||||
| Pensions and other benefits: | ||||||||
| Interest cost | $ | $ | ||||||
| Expected return on plan assets | ( | ) | ( | ) | ||||
| Amortization of net loss | ||||||||
| Settlement expense | ||||||||
| Pension and other postretirement expenses | $ | $ | ||||||
| Other changes in plan assets and benefits obligations recognized in comprehensive income: | ||||||||
| Net loss (gain) | $ | ( | ) | |||||
| Amortization of recognized loss | ( | ) | ( | ) | ||||
| Total recognized gain in comprehensive income | $ | ( | ) | $ | ( | ) | ||
Weighted average assumptions used to determine net periodic benefit cost:
| 2024 | 2023 | |||||||||
| Discount rate | - | - | ||||||||
| Expected long-term return on plan assets | ||||||||||
| Rate of compensation increase | n/a | n/a | ||||||||
The expected long-term rate of return on plan assets was based on a building-block approach. Historical markets are studied and long-term historical relationships between equities and fixed income are presumed consistent with the widely accepted capital market principle that assets with higher volatility generate a greater return over the long run. Current market factors, such as inflation and interest rates, are evaluated before long-term capital markets are determined. Diversification and rebalancing of plan assets are properly considered as part of establishing long-term portfolio returns.
At December 31, 2024 and 2023, the plan held shares of various Aon Collective Investment Trust (“ACIT”) funds. The fair value of the Company’s pension plan assets by category were as follows:
| 2024 Fair Value Measurements | ||||||||||||||||
| ( in thousands) | ||||||||||||||||
| Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Measured at NAC as a practical expedient | Total | |||||||||||||
| ACIT equity funds | $ | $ | $ | $ | ||||||||||||
| ACIT fixed income funds | ||||||||||||||||
| Cash management funds | ||||||||||||||||
| $ | $ | $ | $ | |||||||||||||
| 2023 Fair Value Measurements | ||||||||||||||||
| ( in thousands) | ||||||||||||||||
| Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Measured at NAC as a practical expedient | Total | |||||||||||||
| ACIT equity funds | $ | $ | $ | $ | ||||||||||||
| ACIT fixed income funds | ||||||||||||||||
| Cash management funds | ||||||||||||||||
| $ | $ | $ | $ | |||||||||||||
Level 1 assets are priced using quotes for trades occurring in active markets for the identical asset. Level 2 assets are priced using observable inputs for the asset (for example, interest rates and yield curves observable at commonly quoted intervals, volatilities, prepayment speeds, loss severities, credit risks, and default rates) or inputs that are derived principally from or corroborated by observable market data by correlation or other means (market-corroborated inputs). Net asset values (“NAV”) of ACIT funds included in Level 2 are readily determinable, measured daily and based on the fair value of each fund’s underlying investments. For certain ACIT funds, NAV is used as a practical expedient to estimate fair value and is not categorized in the fair value hierarchy. These funds determine NAV based on the fair value of its underlying investments on a monthly or quarterly basis and have redemption restrictions. Redemptions may be requested at the fund’s quarter-end NAV under the notification requirements of each fund, including a
An administrative committee consisting of certain senior management employees administers the Company’s defined benefit pension plan. The pension plan assets are allocated among approved asset types based on the plan’s current funded status and other characteristics set by the administrative committee, subject to liquidity requirements of the plan.
Estimated future benefit payments are as follows (in thousands):
| Years ending December 31, | |||||
| 2024 | $ | ||||
| 2025 | |||||
| 2026 | |||||
| 2027 | |||||
| 2028 | |||||
| 2029-2033 |
The termination notification of the Qualified Plan originally made on August 31, 2023, was amended to November 30, 2023. The change in timing provided for the Company to issue lump sum distributions in the fourth quarter of 2024 amounting to approximately $
| 8. | CONTRACT ASSETS AND LIABILITIES |
Receivables from contracts with customers were $
Deferred license fee revenue
The Company entered into a trademark license agreement with the owner of the Kapalua Plantation and Bay golf courses, effective April 1, 2020. Under the terms and conditions set forth in the agreement, the licensee is granted a perpetual, terminable on default, transferable, non-exclusive license to use the Company’s trademarks and service marks to promote its golf courses and to sell its licensed products. The Company received a single payment royalty of $
| 9. | COMMITMENTS AND CONTINGENCIES |
On December 31, 2018, the State of Hawai‘i Department of Health (“DOH”) issued a Notice and Finding of Violation and Order (“Order”) for alleged wastewater effluent violations related to the Company’s Upcountry Maui wastewater treatment facility. The facility was built in the 1960’s to serve approximately 200 single-family homes developed for workers in the Company’s former agricultural operations. The facility is made up of two 1.5-acre wastewater stabilization ponds and surrounding disposal leach fields. The Order includes, among other requirements, payment of a $
The DOH agreed to defer the Order as we continue to work to resolve and remediate the facility’s wastewater effluent issues through an approved corrective action plan. The construction of additional leach fields and installations of a surface aerator, sludge removal system, and natural pond cover using water plants were completed. Test results from wastewater monitoring indicate effluent concentration amounts within allowable ranges. A feasibility study was prepared and submitted identifying various technical solutions that could be implemented to resolve the Order. The Company submitted a plan and proposed solution to resolve the Order. The plan included the installation of an additional pond that will be lined and installed with aerators. One of the existing ponds will be lined and renovated as necessary and the other pond will be taken offline and used as a backup pond if needed. The Company is awaiting comments, feedback and approval from the DOH at the time of filing the Form 10-K.
Pursuant to a 1999 settlement agreement with the County of Maui, the Company and several chemical manufacturers have agreed to pay for 90% of capital costs to install filtration systems in any future water wells if the presence of a nematicide, commonly known as DBCP, exceeds specified levels, and for the ongoing maintenance and operating cost for filtration systems on existing and future wells. The Company paid approximately $
In addition, from time to time, the Company is the subject of various other claims, complaints and other legal actions which arise in the normal course of the Company’s business activities. The Company believes the resolution of these other matters, in the aggregate, is not likely to have a material adverse effect on the Company’s consolidated financial position or operations.
| 10. | LEASING ARRANGEMENTS |
The Company leases land primarily to agriculture operators and space in commercial buildings, primarily to restaurant and retail tenants through 2048. These operating leases generally provide for minimum rents, licensing fees, percentage rentals based on tenant revenues, and reimbursement of common area maintenance and other expenses. Certain leases allow the lessee an option to extend or terminate the lease agreement. There are no agreements allowing a lessee an option to purchase the underlying asset. Total leasing income subject to ASC Topic 842 for the years ended December 31, 2024 and 2023 were as follows:
| 2024 | 2023 | |||||||
| (in thousands) | ||||||||
| Minimum rentals | $ | $ | ||||||
| Percentage rentals | ||||||||
| Licensing fees | ||||||||
| Other | ||||||||
| Total | $ | $ | ||||||
Leased property, net of accumulated depreciation, was $
Future minimum rental income for the next five years and thereafter are as follows (in thousands):
| Years ending December 31, | ||||
| 2025 | $ | |||
| 2026 | ||||
| 2027 | ||||
| 2028 | ||||
| 2029 | ||||
| Thereafter | ||||
| 11. | SHARE-BASED COMPENSATION |
The Company’s directors and certain members of management receive a portion of their compensation in shares of the Company’s common stock granted under the Company’s 2017 Equity and Incentive Award Plan, as amended (the “Equity Plan”).
Share-based compensation is awarded annually to certain members of the Company’s management based on their achievement of predefined performance goals and objectives under the Equity Plan. Their share-based compensation is comprised of an annual incentive paid in shares of common stock and a long-term incentive paid in restricted shares of common stock vesting quarterly over a period of years. Share-based compensation is valued based on the average of the high and low share price on the date of grant. Shares are issued upon execution of agreements reflecting the grantee’s acceptance of the respective shares subject to the terms and conditions of the Equity Plan. Restricted shares issued under the Equity Plan have voting and regular dividend rights but cannot be disposed of until such time as they are vested. All unvested restricted shares are forfeited upon the grantee’s termination of directorship or employment from the Company.
Directors receive both cash and share-based compensation under the Equity Plan. Their share-based compensation is comprised of restricted shares of common stock vesting quarterly over the directors’ annual period of service which are valued based on the average of the high and low share price on the date of grant. Shares are issued upon execution of agreements reflecting the grantee’s acceptance of the respective shares subject to the terms and conditions of the Equity Plan. Restricted shares issued under the Equity Plan have voting and regular dividend rights but cannot be disposed of until such time as they are vested. All unvested restricted shares are forfeited upon the grantee’s termination of directorship or employment from the Company.
Options to purchase shares of the Company’s common stock under the Equity Plan were granted to directors and the Chief Executive Officer in 2024 and 2023. Stock option grants are valued at the commitment date, based on the fair value of the equity instruments, and recognized as share-based compensation expense on a straight-line basis over its respective vesting periods. The option agreements provide for accelerated vesting if there is a change in control in ownership.
The number of common shares subject to options granted in 2023 for annual board service, board committee service, and continued service of the Chairperson of the Board are
For continued board service of the Chairperson, the stock option grant has a contractual period of years which vests as follows:
An option to purchase
The number of common shares subject to options granted in 2024 for annual board service and board committee service were
The simplified method described in Staff Accounting Bulletin No. 107 was used by management due to the lack of historical option exercise behavior. The Company does not currently issue dividends. There were forfeitures of stock option grants as of December 31, 2024. Management does not anticipate future forfeitures to be material.
Share-based compensation expenses totaled $
On August 5, 2024, R. Scot Sellers, a director and Chairperson of the Board, Steve Case, a director, and Race A. Randle, Chief Executive Officer, voluntarily executed agreements to cancel previously granted stock options and common stock grants. The Equity Plan was amended in February 2023 to increase the limit on the number of shares to be awarded during a plan year to
| 12. | INCOME TAXES |
GAAP prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return.
The Company’s provision for income taxes is calculated using the liability method. Deferred income taxes are provided for all temporary differences between the financial statement and income tax bases of assets and liabilities using tax rates enacted by law or regulation.
Reconciliations between the total income tax expense (benefit) and the amount computed using the statutory federal rate of
| Year Ended December 31, | ||||||||
| 2024 | 2023 | |||||||
| (in thousands) | ||||||||
| Federal income tax expense/(benefit) at statutory rate | ( | ) | ( | ) | ||||
| Adjusted for: | ||||||||
| Permanent Differences | ||||||||
| True-Ups | ( | ) | ||||||
| Valuation Allowance | ||||||||
| Income Tax expense/(benefit) | ||||||||
Deferred tax assets were comprised of the following temporary differences as of December 31, 2024 and 2023:
| Year Ended December 31, | ||||||||
| 2024 | 2023 | |||||||
| Net operating loss and tax credit carryforwards | $ | $ | ||||||
| Joint Venture and other investments | ( | ) | ( | ) | ||||
| Accrued retirement benefits and other compensation | ||||||||
| Property net book value | ||||||||
| Deferred Revenue | ||||||||
| Reserves and other | ||||||||
| Total Deferred Tax Assets | ||||||||
| Valuation Allowance | ( | ) | ( | ) | ||||
| Net deferred tax asset | ||||||||
Valuation allowances at December 31, 2024 and 2023 have been established to reduce future tax benefits not expected to be realized. Net Operating Loss (NOL) carryforwards created in tax years beginning after December 31, 2017 are limited by the TCJA but do not expire. At December 31, 2024, the Company had approximately $
The Company is subject to U.S. federal income tax as well as income tax in Hawaii. The Company is currently open to examination by taxing authorities for tax years ended after 2020. The Company recognizes and reports interest and penalties related to unrecognized tax benefits if applicable, within the provision for income tax expense. The Company had
| 13. | SEGMENT INFORMATION |
The Company’s reportable operating segments are comprised of the discrete business units whose operating results are regularly reviewed by the Company’s Chief Executive Officer, its chief operating decision maker, and the Board of Directors in assessing performance and determining the allocation of resources. Reportable operating segments in 2024 were as follows:
| • | Land development and sales operations consist of land planning and entitlement, development, development related construction, and sales of land assets. |
| • | Leasing primarily includes revenues and expenses from real property leasing activities, license fees and royalties for the use of certain of the Company’s trademarks and brand names by third parties, and the cost of maintaining the Company’s real estate assets, including conservation activities. The operating segment also includes the management of ditch, reservoir and well systems that provide potable and non-potable water to West and Upcountry Maui areas. |
| • | Resort Amenities include a membership program that provides certain benefits and privileges within the Kapalua Resort for its members. |
The Company’s reportable operating segment results were measured based on operating income, exclusive of interest, pension and other postretirement expenses.
Condensed consolidated financial information for each of the Company’s reportable segments for the years ended December 31, 2024 and 2023 (in thousands) were as follows:
| Land Development & Sales | Leasing | Resort Amenities | Other | Consolidated | ||||||||||||||||
| 2024 | ||||||||||||||||||||
| Operating revenues (1) | $ | $ | $ | $ | $ | |||||||||||||||
| Operating costs and expenses | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Depreciation expense | ( | ) | ( | ) | ( | ) | ||||||||||||||
| General and administrative expenses | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Operating loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Pension and other postretirement expenses | ( | ) | ||||||||||||||||||
| Interest expense | ( | ) | ||||||||||||||||||
| Loss on asset disposal | ||||||||||||||||||||
| Other income | ||||||||||||||||||||
| Income from continuing operations | ( | ) | ||||||||||||||||||
| Capital expenditures (2) | $ | $ | $ | $ | $ | |||||||||||||||
| Assets (3) | $ | (4) | $ | $ | $ | $ | ||||||||||||||
| (1) | Amounts are principally revenues from external customers and exclude equity in earnings of affiliates. |
| (2) | Includes expenditures for property and deferred costs. |
| (3) | Segment assets are located in the United States. |
| (4) | The Land Development and Sales segment includes a $ |
| Land Development & Sales | Leasing | Resort Amenities | Other | Consolidated | ||||||||||||||||
| 2023 | ||||||||||||||||||||
| Operating revenues (1) | $ | $ | $ | $ | $ | |||||||||||||||
| Operating costs and expenses | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Depreciation expense | ( | ) | ( | ) | ( | ) | ||||||||||||||
| General and administrative expenses | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Operating loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Pension and other postretirement expenses | ( | ) | ||||||||||||||||||
| Interest expense | ( | ) | ||||||||||||||||||
| Gain from derecognition of nonfinancial asset | ||||||||||||||||||||
| Other income | ||||||||||||||||||||
| Income from continuing operations | ( | ) | ||||||||||||||||||
| Capital expenditures (2) | $ | $ | $ | $ | $ | |||||||||||||||
| Assets (3) | $ | (4) | $ | $ | $ | $ | ||||||||||||||
| (1) | Amounts are principally revenues from external customers and exclude equity in earnings of affiliates. |
| (2) | Includes expenditures for property and deferred costs. |
| (3) | Segment assets are located in the United States. |
| (4) | The Land Development and Sales segment includes a $ |
| 14. | RESERVES |
Allowance for credit losses for 2024 and 2023 were as follows:
| Description | Balance at Beginning of Year | Increase (Decrease) | Balance at End of Year | |||||||||
| (in thousands) | ||||||||||||
| Allowance for Credit Losses | ||||||||||||
| 2024 | $ | $ | ( | ) | $ | |||||||
| 2023 | $ | $ | $ | |||||||||
| CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE |
None.
| CONTROLS AND PROCEDURES |
EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES
Our management, with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of December 31, 2024. We maintain disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow for timely decisions regarding required disclosure. Our management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures as of December 31, 2024, our principal executive officer, principal financial officer, and principal accounting officer concluded that, as of such date, our disclosure controls and procedures were effective.
MANAGEMENT’S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
Our management has the responsibility for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act, as a process designed by, or under the supervision of, the Company’s principal executive, principal financial officer, principal accounting officer, and effected by our Board, management and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America. Our internal controls over financial reporting include those policies and procedures that:
| • |
Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; |
| • |
Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America, and that receipts and expenditures of the Company are being made only in accordance with authorizations of our management and directors; and |
| • |
Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements. |
Because of its inherent limitations, internal control over financial reporting only provides reasonable assurance with respect to financial statement presentation and preparation. Projections of any evaluation of effectiveness to future periods are subject to the risks that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Our management, including our Chief Executive Officer and Chief Financial Officer, assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2024. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control—Integrated Framework (2013). Based on its assessments, management believes that, as of December 31, 2024, the Company’s internal control over financial reporting is effective.
As we are a smaller reporting company, our independent registered public accounting firm is not required to attest to the effectiveness of our internal control over financial reporting.
CHANGES IN INTERNAL CONTROLS OVER FINANCIAL REPORTING
We have made changes in our internal controls over financial reporting (as such term is defined in Exchange Act Rule 13a-15(f) or 15d-15(f)) relating to joint venture reporting during the fiscal fourth quarter that has materially affected, or is reasonably likely to materially affect, the Company’s internal controls over financial reporting. The Company has designed and implemented new controls to address the risks related to the accounting of its investments in unconsolidated joint ventures.
| DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS |
Not applicable.
| DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE |
The information required under this item will be set forth in our proxy statement related to our 2025 Annual Meeting of Stockholders, which will be filed with the SEC no later than 120 days after the close of our fiscal year ended December 31, 2024, and is incorporated herein by reference.
Insider Trading Policy
We have an insider trading policy (the “Insider Trading Policy”), which was most recently amended on March 4, 2025, that governs purchases, sales and other dispositions of our securities by our directors, executive officers, employees and contractors, where applicable. We believe our Insider Trading Policy is reasonably designed to promote compliance with insider trading laws, rules and regulations, and the NYSE listing standards applicable to us. Our Insider Trading Policy prohibits purchases, sales and other dispositions of our securities while in possession of material nonpublic information about us and from disclosing such information to others, and it prohibits trading on material nonpublic information of other companies obtained during the course of providing service to us. It also imposes additional restrictions on and trading requirements for trading in our securities by our insiders. A copy of our Insider Trading Policy is filed as Exhibit 19.1 to this 2024 Annual Report.
| EXECUTIVE COMPENSATION |
The information required under this item will be set forth in our proxy statement related to our 2025 Annual Meeting of Stockholders, which will be filed with the SEC no later than 120 days after the close of our fiscal year ended December 31, 2024, and is incorporated herein by reference.
| SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS |
The information required under this item will be set forth in our proxy statement related to our 2025 Annual Meeting of Stockholders, which will be filed with the SEC no later than 120 days after the close of our fiscal year ended December 31, 2024, and is incorporated herein by reference.
| CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE |
The information required under this item will be set forth in our proxy statement related to our 2025 Annual Meeting of Stockholders, which will be filed with the SEC no later than 120 days after the close of our fiscal year ended December 31, 2024, and is incorporated herein by reference.
| PRINCIPAL ACCOUNTANT FEES AND SERVICES |
The information required under this item will be set forth in our proxy statement related to our 2025 Annual Meeting of Stockholders, which will be filed with the SEC no later than 120 days after the close of our fiscal year ended December 31, 2024, and is incorporated herein by reference.
| EXHIBITS, FINANCIAL STATEMENT SCHEDULES |
a)
| 1. |
Financial Statements. The following financial statements of Maui Land & Pineapple Company, Inc. and subsidiaries and Report of Independent Registered Public Accounting Firm are included in Item 8 of this Annual Report: |
| 2. |
Financial Statements schedules. Financial statement schedules are omitted because they are not applicable, or the required information is shown in the financial statements or notes thereto. |
| 3. |
Exhibits. The following is a list of exhibits filed as part of this Form 10-K. |
| 19.1 | Insider Trading Policy | X | ||||
| 21.1 |
X |
|||||
| 23.1* |
Consent of Accuity LLP, Independent Registered Public Accounting Firm, dated March 28, 2024 |
X |
||||
| 24.1 |
Power of Attorney (included on the signature page of this report) |
X |
||||
| 31.1 |
X |
|||||
| 31.2 |
X |
|||||
| 32.1* |
X |
|||||
| 32.2* |
X |
|||||
| 97.1 | Clawback Policy | X | ||||
| 101.INS |
Inline XBRL Instance Document |
X |
||||
| 101.SCH |
Inline XBRL Taxonomy Extension Schema Document |
X |
||||
| 101.CAL |
InlineXBRL Taxonomy Extension Calculation document |
X |
||||
| 101.DEF |
Inline XBRL Taxonomy Extension Definition Linkbase |
X |
||||
| 101.LAB |
InlineXBRL Taxonomy Extension labels Linkbase Document |
X |
||||
| 101.PRE |
Inline XBRL Taxonomy Extension Presentation Link Document |
X |
||||
| 104 |
Cover Page Interactive Data File (formatted in the Inline XBRL and contained in Exhibit 101). |
|||||
| * | This certification shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section, nor shall it be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that the registrant specifically incorporates it by reference. | |||||
| # | Indicates a management contract or compensatory plan or arrangement. | |||||
| FORM 10-K SUMMARY |
Not applicable.
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on March 31, 2025.
| MAUI LAND & PINEAPPLE COMPANY, INC. |
||
| By: |
/s/ Race Randle |
|
| Race Randle |
||
KNOW ALL PERSONS BY THESE PRESENTS, that each individual whose signature appears below hereby constitutes and appoints Race Randle and Wade K. Kodama, and each or either of them, acting individually, as his or her true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution for him or her and in his or her name, place and stead, in any and all capacities, to sign any and all amendments to this Annual Report, and to file the same, with all exhibits thereto and other documents in connection therewith, with the SEC, granting unto said attorney-in-fact and agent, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully for all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent, or any of them, or their or his or her substitutes, may lawfully do or cause to be done or by virtue hereof.
Pursuant to the requirements of the Exchange Act, as amended, this Annual Report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| By |
/s/ Race Randle |
Date: March 31, 2025 |
|
| Race Randle, Chief Executive Officer (Principal Executive Officer) |
|||
| By |
/s/ Scot Sellers |
Date: March 31, 2025 |
|
| Scot Sellers, Chairman of the Board |
|||
| By | /s/ Wade K. Kodama | Date: March 31, 2025 | |
| Wade K. Kodama, Chief Financial Officer | |||
| (Principal Financial Officer and Principal Accounting Officer) | |||
| By |
/s/ Stephen M. Case |
Date: March 31, 2025 |
|
| Stephen M. Case, Director |
|||
| By |
/s/ Anthony P. Takitani |
Date: March 31, 2025 |
|
| Anthony P. Takitani, Director |
|||
| By |
/s/ Glyn F. Aeppel |
Date: March 31, 2025 |
|
| Glyn F. Aeppel, Director |
|||
| By |
/s/ Ken Ota |
Date: March 31, 2025 |
|
| Ken Ota, Director |
|||
| By |
/s/ Catherine Ngo |
Date: March 31, 2025 |
|
| Catherine Ngo, Director |
|||
| By |
/s/ John M. Sabin |
Date: March 31, 2025 |
|
| John M. Sabin, Director |
EXHIBIT 10.11
MAUI LAND & PINEAPPLE COMPANY, INC.
2017 EQUITY AND INCENTIVE AWARD PLAN
RESTRICTED STOCK AWARD GRANT NOTICE OF LONG-TERM INCENTIVE
Maui Land & Pineapple Company, Inc., a Delaware corporation (the “Company”), pursuant to its 2017 Equity and Incentive Award Plan (the “Plan”), hereby grants to the holder listed below (“Holder”) the number of shares of the Company’s common stock, par value $0.0001 (the “Common Stock”), set forth below (the “Restricted Stock Award”). This Restricted Stock Award is subject to all of the terms and conditions as set forth herein and in the Restricted Stock Award Agreement attached hereto as Exhibit A (the “Restricted Stock Agreement”) and the Plan, each of which are incorporated herein by reference. Unless otherwise defined herein, the terms defined in the Plan shall have the same defined meanings in this Restricted Stock Award Grant Notice (the “Grant Notice”).
Holder:
Grant Date:
Shares Price on Grant Date:
Stock Award Value for Year
Ending 12/31/20XX:
Total Number of
Shares of Restricted Stock:
|
Vesting Schedule: |
Subject to the terms and conditions of the Plan, this Grant Notice and the Restricted Stock Agreement, the Company’s Forfeiture Restriction (as defined in the Restricted Stock Agreement) the Shares will vest as follows: |
||
| Vesting date | Shares | ||
| 03/31/XX | XX | Vested at end of calendar quarter | |
| 06/30/XX | XX | ||
| 09/30/XX | XX | ||
| 12/31/XX | XX | ||
| 03/31/XX | XX | ||
| 06/30/XX | XX | ||
| 09/30/XX | XX | ||
| 12/31/XX | XX | ||
| 03/31/XX | XX | ||
| 06/30/XX | XX | ||
| 09/30/XX | XX | ||
| 12/31/XX | XX | ||
| Total | XX | ||
| Notwithstanding the vesting schedule stated above, in the event of a Change-In-Control as defined in Section 1.6 of the Plan, the Forfeiture Restriction shall terminate and the Restricted Stock Award shall automatically vest immediately prior to such Change in Control; provided, however, that any acquisition or disposition of the Company’s voting securities by the officers or directors of the Company as of the date of this Grant Notice or an entity controlled by any such officer or director shall not be deemed a Change in Control and shall not trigger the foregoing acceleration of the Restricted Stock Award. | |||
| In no event, however, shall the Forfeiture Restriction (as defined in the Restricted Stock Agreement) lapse as to any additional Shares following Holder’s Termination of Employment or Directorship. | |||
By his or her signature below, Holder agrees to be bound by the terms and conditions of the Plan, the Restricted Stock Agreement and this Grant Notice. Holder has reviewed the Restricted Stock Agreement, the Plan and this Grant Notice in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Grant Notice and fully understands all provisions of this Grant Notice, the Restricted Stock Agreement and the Plan. Holder hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under or relating to the Plan, this Grant Notice or the Restricted Stock Agreement.
|
MAUI LAND & PINEAPPLE COMPANY, INC.: |
HOLDER: |
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By: |
By: |
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Print Name: |
Wade K. Kodama |
Print Name: |
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Title: |
Chief Financial Officer |
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Address: |
500 Office Road |
Address: |
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Lahaina, Maui, Hawaii 96761 |
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Date: |
Date: |
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Attachments: |
Restricted Stock Award Agreement (Exhibit A) |
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Maui Land & Pineapple Company, Inc. 2017 Equity and Incentive Award Plan (Exhibit B) |
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Maui Land & Pineapple Company, Inc. 2017 Equity and Incentive Award Plan Prospectus (Exhibit C) |
EXHIBIT A
RESTRICTED STOCK AWARD AGREEMENT
Pursuant to the Restricted Stock Award Grant Notice (“Grant Notice”) to which this Restricted Stock Award Agreement (this “Agreement”) is attached, Maui Land & Pineapple Company, Inc., a Delaware corporation (the “Company”), has granted to Holder the number of shares of the Company’s common stock, par value $0.0001 (“Stock”), set forth in the Grant Notice (the “Shares”), upon the terms and conditions set forth in the Company’s 2017 Equity and Incentive Award Plan (the “Plan”), the Grant Notice and this Agreement.
GENERAL
Defined Terms. Capitalized terms not specifically defined herein shall have the meanings specified in the Grant Notice or, if not defined therein, the Plan.
Incorporation of Terms of Plan. The Shares are subject to the terms and conditions of the Plan which are incorporated herein by reference.
GRANT OF RESTRICTED STOCK
Grant of Restricted Stock. In consideration of Holder’s past and/or continued service to the Company or its Subsidiaries and for other good and valuable consideration, effective as of the Grant Date set forth in the Grant Notice (the “Grant Date”), the Company hereby agrees to issue to Holder the Shares, upon the terms and conditions set forth in the Plan, the Grant Notice and this Agreement.
Issuance of Shares. The issuance of the Shares under this Agreement shall occur at the principal office of the Company simultaneously with, or as soon as practicable after, the execution of the Grant Notice by the parties or on such other date as the Company and Holder shall agree (the “Issuance Date”). Subject to the provisions of Article IV, the Company shall issue the Shares (which shall be issued in Holder’s name) on the Issuance Date.
Conditions to Issuance of Stock Certificates. The Shares, or any portion thereof, may be either previously authorized but unissued shares or issued shares which have then been reacquired by the Company. Such Shares shall be fully paid and nonassessable. The Company shall not be required to issue or deliver any Shares prior to fulfillment of all of the following conditions:
The admission of such Shares to listing on all stock exchanges on which the Stock is then listed;
The completion of any registration or other qualification of such Shares under any state or federal law or under rulings or regulations of the Securities and Exchange Commission or of any other governmental regulatory body, which the Board shall, in its absolute discretion, deem necessary or advisable;
The obtaining of any approval or other clearance from any state or federal governmental agency which the Board shall, in its absolute discretion, determine to be necessary or advisable;
The lapse of such reasonable period of time following the Issuance Date as the Board may from time to time establish for reasons of administrative convenience; and
The receipt by the Company of full payment for all amounts (if any) which, under federal, state or local tax law, the Company (or other employer corporation) is required to withhold upon issuance of such Shares.
Rights as Stockholder. Except as otherwise provided herein, upon delivery of the Shares to the escrow agent pursuant to Article IV, Holder shall have all the rights of a stockholder with respect to said Shares, subject to the restrictions herein, including the right to vote the Shares and to receive all dividends or other distributions paid or made with respect to the Shares; provided, however, that any and all extraordinary cash dividends paid on such Shares and any and all shares of Stock, capital stock or other securities or property received by or distributed to Holder with respect to the Shares as a result of any stock dividend, stock split, reverse stock split, recapitalization, combination, reclassification, or similar change in the capital structure of the Company shall also be subject to the Forfeiture Restriction (as defined in Section 3.1) and the restrictions on transfer in Section 3.4 until such restrictions on the underlying Shares lapse or are removed pursuant to this Agreement (or, if such Shares are no longer outstanding, until such time as such Shares would have been released from the Forfeiture Restriction pursuant to this Agreement). In addition, in the event of any merger, consolidation, share exchange or reorganization affecting the Shares, including, without limitation, a Change in Control, then any new, substituted or additional securities or other property (including money paid other than as a regular cash dividend) that is by reason of any such transaction received with respect to, in exchange for or in substitution of the Shares shall also be subject to the Forfeiture Restriction (as defined in Section 3.1) and the restrictions on transfer in Section 3.4 until such restrictions on the underlying Shares lapse or are removed pursuant to this Agreement (or, if such Shares are no longer outstanding, until such time as such Shares would have been released from the Forfeiture Restriction pursuant to this Agreement). Any such assets or other securities received by or distributed to Holder with respect to, in exchange for or in substitution of any Unreleased Shares (as defined in Section 3.3) shall be immediately delivered to the Company to be held in escrow pursuant to Section 4.1.
RESTRICTIONS ON SHARES
Forfeiture Restriction. Subject to the provisions of Section 3.2, if Holder has a Termination of Employment, Termination of Directorship, or Termination of Consultancy, applicable, for any or no reason, all of the Unreleased Shares (as defined in Section 3.3) shall thereupon be forfeited immediately and without any further action by the Company (the “Forfeiture Restriction”). Upon the occurrence of such a forfeiture, the Company shall become the legal and beneficial owner of the Shares being forfeited and all rights and interests therein or relating thereto, and the Company shall have the right to retain and transfer to its own name the number of Shares being forfeited by Holder. In the event any of the Unreleased Shares are forfeited under this Section 3.1, any cash, cash equivalents, assets or securities received by or distributed to Holder with respect to, in exchange for or in substitution of such Shares and held by the escrow agent pursuant to Section 4.1 and the Joint Escrow Instructions shall be promptly transferred by the escrow agent to the Company.
Release of Shares from Forfeiture Restriction. The Shares shall be released from the Forfeiture Restriction as indicated in the Grant Notice. Any of the Shares released from the Forfeiture Restriction shall thereupon be released from the restrictions on transfer under Section 3.4. In the event any of the Shares are released from the Forfeiture Restriction, any dividends or other distributions paid on such Shares and held by the escrow agent pursuant to Section 4.1 and the Joint Escrow Instructions shall be promptly paid by the escrow agent to Holder.
Unreleased Shares. Any of the Shares which, from time to time, have not yet been released from the Forfeiture Restriction are referred to herein as “Unreleased Shares.”
Restrictions on Transfer. Unless otherwise permitted by the Board pursuant to the Plan, no Unreleased Shares or any dividends or other distributions thereon or any interest or right therein or part thereof, shall be subject to sale or other disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such sale or other disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted sale or other disposition thereof shall be null and void and of no effect.
ESCROW OF SHARES
Escrow of Shares. To ensure the availability for delivery of Holder’s Unreleased Shares in the event of forfeiture of such Shares by Holder pursuant to Section 3.1, Holder hereby appoints the Secretary of the Company, or any other person designated by the Secretary or the Board as escrow agent, as his or her attorney-in-fact to assign and transfer unto the Company, such Unreleased Shares, if any, forfeited by Holder pursuant to Section 3.1 and any dividends or other distributions thereon, and shall, upon request by the Company, deliver and deposit with the Secretary of the Company, or such other person designated by the Board, any share certificates representing the Unreleased Shares, together with a stock assignment duly endorsed in blank. The Unreleased Shares and stock assignment shall be held by the Secretary of the Company, or such other person designated by the Board, in escrow, until the Unreleased Shares are forfeited by Holder as provided in Section 3.1, until such Unreleased Shares are released from the Forfeiture Restriction, or until such time as this Agreement no longer is in effect. Upon release of the Unreleased Shares from the Forfeiture Restriction, the escrow agent shall deliver to Holder the certificate or certificates representing such Shares in the escrow agent’s possession, and the escrow agent shall be discharged of all further obligations hereunder; provided, however, that the escrow agent shall nevertheless retain such certificate or certificates as escrow agent if so required pursuant to other restrictions imposed pursuant to this Agreement. If the Shares are held in book entry form, then such entry will reflect that the Shares are subject to the restrictions of this Agreement. If any dividends or other distributions are paid on the Unreleased Shares held by the escrow agent pursuant to this Section 4.1, such dividends or other distributions shall also be subject to the restrictions set forth in this Agreement and held in escrow pending release of the Unreleased Shares with respect to which such dividends or other distributions were paid from the Forfeiture Restriction.
Transfer of Forfeited Shares. Holder hereby authorizes and directs the Secretary of the Company, or such other person designated by the Secretary or the Board, to transfer the Unreleased Shares which have been forfeited by Holder to the Company.
No Liability for Actions in Connection with Escrow. The Company, or its designee, shall not be liable for any act it may do or omit to do with respect to holding the Shares in escrow while acting in good faith and in the exercise of its judgment.
OTHER PROVISIONS
Adjustment for Stock Split. In the event of any stock dividend, stock split, reverse stock split, recapitalization, combination, reclassification, or similar change in the capital structure of the Company, the Board shall make appropriate and equitable adjustments in the Unreleased Shares subject to the Forfeiture Restriction and the number of Shares, consistent with any adjustment under Section 11.3 of the Plan. The provisions of this Agreement shall apply, to the full extent set forth herein with respect to the Shares, to any and all shares of capital stock or other securities, property or cash which may be issued in respect of, in exchange for, or in substitution of the Shares, and shall be appropriately adjusted for any stock dividends, splits, reverse splits, combinations, recapitalizations and the like occurring after the date hereof.
Taxes. Holder has reviewed with Holder’s own tax advisors the federal, state, local and foreign tax consequences of this investment and the transactions contemplated by the Grant Notice and this Agreement. Holder is relying solely on such advisors and not on any statements or representations of the Company or any of its agents. Holder understands that Holder (and not the Company) shall be responsible for Holder’s own tax liability that may arise as a result of this investment or the transactions contemplated by this Agreement. Holder understands that Holder will recognize ordinary income for federal income tax purposes under Section 83 of the Code as the restrictions applicable to the Unreleased Shares lapse. In this context, “restriction” includes the Forfeiture Restriction. Holder understands that Holder may elect to be taxed for federal income tax purposes at the time the Shares are issued rather than as and when the Forfeiture Restriction lapses by filing an election under Section 83(b) of the Code with the Internal Revenue Service no later than thirty days following the date of purchase. A form of election under Section 83(b) of the Code is attached to the Grant Notice as Exhibit D.
HOLDER ACKNOWLEDGES THAT IT IS HOLDER’S SOLE RESPONSIBILITY AND NOT THE COMPANY’S TO TIMELY FILE THE ELECTION UNDER SECTION 83(b), EVEN IF HOLDER REQUESTS THE COMPANY OR ITS REPRESENTATIVES TO MAKE THIS FILING ON HOLDER’S BEHALF.
Limitations Applicable to Section 16 Persons. Notwithstanding any other provision of the Plan or this Agreement, the Plan, the Shares and this Agreement shall be subject to any additional limitations set forth in any applicable exemptive rule under Section 16 of the Exchange Act (including any amendment to Rule 16b-3 of the Exchange Act) that are requirements for the application of such exemptive rule. To the extent permitted by applicable law, this Agreement shall be deemed amended to the extent necessary to conform to such applicable exemptive rule.
Administration. The Board shall have the power to interpret the Plan and this Agreement and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith and to interpret, amend or revoke any such rules. All actions taken and all interpretations and determinations made by the Board in good faith shall be binding, conclusive and final upon Holder, the Company and all other interested persons. No member of the Board shall be personally liable for any action, determination or interpretation made in good faith with respect to the Plan, this Agreement or the Shares.
Restrictive Legends and Stop-Transfer Orders.
Any share certificate(s) evidencing the Shares issued hereunder shall be endorsed with the following legend and any other legend(s) that may be required by any applicable federal or state securities laws:
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO FORFEITURE IN FAVOR OF THE COMPANY AND MAY BE TRANSFERRED ONLY IN ACCORDANCE WITH THE TERMS OF A RESTRICTED STOCK AWARD AGREEMENT BETWEEN THE COMPANY AND THE STOCKHOLDER, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY.
Holder agrees that, in order to ensure compliance with the restrictions referred to herein, the Company may issue appropriate “stop transfer” instructions to its transfer agent, if any, and that, if the Company transfers its own securities, it may make appropriate notations to the same effect in its own records.
The Company shall not be required: (i) to transfer on its books any Shares that have been sold or otherwise transferred in violation of any of the provisions of this Agreement, or (ii) to treat as owner of such Shares or to accord the right to vote or pay dividends to any purchaser or other transferee to whom such Shares shall have been so transferred.
Tax Withholding.
The Company shall be entitled to require payment of any sums required by federal, state or local tax law to be withheld with respect to the transfer of the Shares or the lapse of the Forfeiture Restriction with respect to the Shares, or any other taxable event related thereto. The Company may permit Holder to make such payment in one or more of the forms specified below:
(i) by cash or check made payable to the Company;
(ii) by the deduction of such amount from other compensation payable to Holder;
(iii) by tendering Shares which are not subject to the Forfeiture Restriction and which have a then current Fair Market Value not greater than the amount necessary to satisfy the Company’s withholding obligation based on the minimum statutory withholding rates for federal, state and local income tax and payroll tax purposes; or
(iv) in any combination of the foregoing.
In the event Holder fails to provide timely payment of all sums required by the Company pursuant to Section 5.6(a), the Company shall have the right and option, but not obligation, to treat such failure as an election by Holder to provide all or any portion of such required payment by means of tendering Shares in accordance with Section 5.6(a)(iii).
Notices. Any notice to be given under the terms of this Agreement to the Company shall be addressed to the Company in care of the Secretary of the Company, and any notice to be given to Holder shall be addressed to Holder at the address given beneath Holder’s signature on the Grant Notice. By a notice given pursuant to this Section 5.7, either party may hereafter designate a different address for notices to be given to that party. Any notice shall be deemed duly given when sent via email or when sent by certified mail (return receipt requested) and deposited (with postage prepaid) in a post office or branch post office regularly maintained by the United States Postal Service.
Titles. Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement.
Governing Law; Severability. This Agreement shall be administered, interpreted and enforced under the laws of the State of Delaware without regard to conflicts of laws thereof. Should any provision of this Agreement be determined by a court of law to be illegal or unenforceable, the other provisions shall nevertheless remain effective and shall remain enforceable.
Conformity to Securities Laws. Holder acknowledges that the Plan is intended to conform to the extent necessary with all provisions of the Securities Act and the Exchange Act and any and all regulations and rules promulgated by the Securities and Exchange Commission thereunder, and state securities laws and regulations. Notwithstanding anything herein to the contrary, the Plan shall be administered, and the Shares are to be issued, only in such a manner as to conform to such laws, rules and regulations. To the extent permitted by applicable law, the Plan and this Agreement shall be deemed amended to the extent necessary to conform to such laws, rules and regulations.
Amendments. This Agreement may not be modified, amended or terminated except by an instrument in writing, signed by Holder and by a duly authorized representative of the Company.
Successors and Assigns. The Company may assign any of its rights under this Agreement to single or multiple assignees, and this Agreement shall inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer herein set forth, this Agreement shall be binding upon Holder and his or her heirs, executors, administrators, successors and assigns.
Award Subject to Company Clawback or Recoupment. To the extent permitted by applicable law, the Shares shall be subject to clawback or recoupment pursuant to any compensation clawback or recoupment policy adopted by the Board or required by law during the term of your employment or other Service with the Company that is applicable to you. In addition to any other remedies available under such policy, applicable law may require the cancellation of your Shares (whether vested or unvested) and the recoupment of any gains realized with respect to your Shares.
EXHIBIT B
MAUI LAND & PINEAPPLE COMPANY, INC.
2017 EQUITY AND INCENTIVE AWARD PLAN
EXHIBIT C
MAUI LAND & PINEAPPLE COMPANY, INC.
2017 EQUITY AND INCENTIVE AWARD PLAN PROSPECTUS
EXHIBIT 10.12
MAUI LAND & PINEAPPLE COMPANY, INC.
2017 EQUITY AND INCENTIVE AWARD PLAN
RESTRICTED STOCK UNIT AWARD NOTICE
Maui Land & Pineapple Company, Inc., a Delaware corporation (the “Company”), pursuant to its 2017 Equity and Incentive Award Plan (the “Plan”), hereby grants to the director listed below (“Director”) the number of Restricted Stock Units (“Units”) listed below. This Restricted Stock Unit Award Notice is subject to all of the terms and conditions as set forth herein and in the Restricted Stock Unit Agreement attached hereto as Exhibit A (the “Agreement”) and the Plan, each of which are incorporated herein by reference. Unless otherwise defined herein, the terms defined in the Plan shall have the same defined meanings in this Restricted Stock Unit Award Notice (the “Award Notice”).
Director:
Award Date:
Total Number of Units:
| Vesting Schedule: | Subject to the provisions of the Agreement, the Director’s ownership interest in the Units shall vest, and the status of the Units as Unvested Units and all Restrictions with respect to the Units shall terminate, in accordance with the following schedule of events: | |||||
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Vesting Event |
Incremental |
Total Shares Vested |
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March 31 after the Award Date |
25% |
25% |
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June 30 after the Award Date |
25% |
50% |
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September 30 after the Award Date |
25% |
75% |
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December 31 after the Award Date |
25% |
100% |
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Termination of the Director’s service as a director by vote of the Company’s stockholders for any reason other than Cause |
100%* |
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Failure by the Board of Directors or any authorized committee thereof to nominate the Director for re-election for any reason other than for Cause |
100%* |
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Failure of the Company’s stockholders to re-elect the Director |
100%* |
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Death or Disability of the Director |
100%* |
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If earlier than any of the above events, a Change in Control |
100%* |
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*or, if fewer, all Restricted Units
By his or her signature below, the Director agrees to be bound by the terms and conditions of the Plan, the Agreement and this Award Notice. The Director has reviewed the Agreement, the Plan and this Award Notice in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Award Notice and fully understands all provisions of this Award Notice, the Agreement and the Plan. The Director hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under or relating to the Plan, this Award Notice or the Agreement.
| MAUI LAND & PINEAPPLE COMPANY, INC.: | DIRECTOR: | ||||
| By: | |||||
| Print Name: | By: | ||||
| Title: | Print Name: | ||||
| Address: | |||||
| Address: | |||||
| Date: | |||||
| Attachments: | Restricted Stock Unit Award Agreement (Exhibit A) |
| Maui Land & Pineapple Company, Inc. 2017 Equity and Incentive Award Plan (Exhibit B) | |
| Maui Land & Pineapple Company, Inc. 2017 Equity and Incentive Award Plan Prospectus (Exhibit C) |
EXHIBIT A
RESTRICTED STOCK UNIT AWARD AGREEMENT
Pursuant to the Restricted Stock Unit Award Notice (“Award Notice”) to which this Restricted Stock Unit Award Agreement (this “Agreement”) is attached, Maui Land & Pineapple Company, Inc., a Delaware corporation (the “Company”), has granted to the director named in the Award Notice (the “Director”) the number Restricted Stock Units (“Units”) set forth in the Award Notice, upon the terms and conditions set forth in the Company’s 2017 Equity and Incentive Award Plan (the “Plan”), the Award Notice and this Agreement.
DEFINITIONS
The following terms used below in this Agreement shall have the meaning specified below unless the context clearly indicates to the contrary. Capitalized terms not otherwise defined herein shall have the meanings set forth in the Plan.
Cause
“Cause” means and shall be limited to (a) an affirmative vote of the holders of at least 75 percent of the shares entitled to vote at a meeting of stockholders called for the purpose, resolving that the Director should be removed from office or (b) a vote of the Board, the Nominating and Governance Committee, if any, or any other authorized committee of the Board resolving that the Director should not be nominated for re-election as a director, in either case, as a result of (i) conviction of a felony, (ii) declaration of unsound mind by order of a court, (iii) gross dereliction of duty, (iv) commission of any act involving moral turpitude or (v) commission of an act that constitutes intentional misconduct or a knowing violation of law if such action in either event results in both an improper substantial personal benefit to such Director and a material injury to the Company.
Disability
“Disability” shall mean the Director’s inability to perform his normal required services for the Company for a period of six consecutive months by reason of the individual’s mental or physical disability, as determined by the Administrator in good faith in its sole discretion.
Restrictions
“Restrictions” shall mean the restrictions set forth in Article III of this Agreement.
Secretary
“Secretary” shall mean the secretary of the Company.
Unvested Units
“Unvested Units” shall mean the Units issued under this Agreement for as long as such Units are subject to the Restrictions (as hereinafter defined) imposed by this Agreement.
RESTRICTED UNITS
Unvested Units
Any Units granted on the Award Date pursuant to this Agreement shall be considered Unvested Units for purposes of this Agreement and shall be subject to the Restrictions until such time or times and except to the extent that the Director’s ownership interest in Units vests in accordance with the Vesting Schedule set forth in the Award Notice.
Rights as Stockholder
From and after the Award Date, the Director shall not have any of the rights of a stockholder with respect to the Units until the Units are distributed to the Director in the form of Common Stock, except with respect to Dividend Equivalent rights as set forth on Section 2.3.
Dividend Equivalent Rights
All Units granted hereunder shall carry Dividend Equivalent rights which shall entitle the Director to receive additional Units, based on the amount of actual dividends payable by the Company with respect to the Common Stock. The amount of Dividend Equivalents credited to the Director’s Units shall be credited on the day following the dividend payment date for such dividend based on the Fair Market Value of a share of Common Stock on the payment date. Such additional Units shall also carry Dividend Equivalent rights. All additional Units credited to a Director’s account pursuant to this Section 2.3 shall be fully vested at all times.
RESTRICTIONS
Reversion of Unvested Units
Except as provided in clauses (a) through (e) of this sentence or in the following paragraph, any interest of the Director in Units that are Unvested Units shall immediately terminate if the Director’s service as a director of the Company terminates for any reason, unless such termination of service results from (a) death of the Director, (b) Disability of the Director, (c) removal of the Director from office by vote of the Company’s stockholders for any reason other than for Cause, (d) failure by the Board of Directors or any authorized committee thereof to nominate the Director for re-election for any reason other than for Cause or (e) failure of the Company’s stockholders to re-elect the Director.
Notwithstanding the provisions of the preceding paragraph, in the event that any Unvested Units are forfeited, the Director shall be entitled to payment with respect to any Units credited to his account pursuant to the Dividend Equivalent rights accrued on the Unvested Units in accordance with Section 2.3 before the date of such event.
Units Not Transferable
No Units, whether vested or unvested, or any interest or right therein or part thereof shall be liable for the debts, contracts or engagements of the Director or his successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such disposition be voluntary or involuntary or by operation of law or judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect; provided, however, that this Section 3.2 shall not prevent transfers by will or by applicable laws of descent and distribution until the Units are distributed to the Director in shares of Common Stock. Until such time when the shares of Common Stock are distributed to the Director, the Director’s rights under this Agreement shall be similar to that of an unsecured creditor of the Company.
Timing and Form of Distribution
To the extent not forfeited pursuant to Section 3.1, Units shall be exchanged into shares of Common Stock on a one-for-one basis and shall be distributed to the Director within 90 days after the date the Director terminates his or her services as a director of the Company but not later than the same tax year of the date the Director terminates his or her service as a director of the Company. Any fractional Unit shall be distributed in cash at the same time.
MISCELLANEOUS
Conditions to Issuance of Stock
The Company shall not be required to issue or deliver any certificate or certificates or enter the Director’s name as the stockholder of record on the books of the Company for shares of stock pursuant to this Agreement prior to fulfillment of all of the following conditions:
The admission of such shares to listing on all stock exchanges on which such class of stock is then listed; and
The completion of any registration or other qualification of such shares under any state or Federal law or under rulings or regulations of the Securities and Exchange Commission or of any other governmental regulatory body, which the Company shall deem necessary or advisable; and
The obtaining of any approval or other clearance from any state or Federal governmental agency which the Company shall, in its absolute discretion, determine to be necessary or advisable.
Administration
The Board shall have the power to interpret the Plan and this Agreement and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith and to interpret, amend or revoke any such rules. All actions taken and all interpretations and determinations made by the Board in good faith shall be binding, conclusive and final upon the Director, the Company and all other interested persons. No member of the Board shall be personally liable for any action, determination or interpretation made in good faith with respect to the Plan, this Agreement or the Units.
Taxes.
The Director has reviewed with the Director’s own tax advisors the federal, state, local and foreign tax consequences of this investment and the transactions contemplated by the Award Notice and this Agreement. The Director is relying solely on such advisors and not on any statements or representations of the Company or any of its agents. The Director understands that the Director (and not the Company) shall be responsible for the Director’s own tax liability that may arise as a result of this investment or the transactions contemplated by this Agreement.
Adjustment for Stock Split.
In the event of any stock dividend, stock split, reverse stock split, recapitalization, combination, reclassification, or similar change in the capital structure of the Company, the Board shall make appropriate and equitable adjustments in the Units and the number of shares issuable under this Agreement, consistent with any adjustment under Section 11.3 of the Plan.
Notices
Any notice to be given under the terms of this Agreement to the Company shall be addressed to the Company in care of its Secretary, and any notice to be given to the Director shall be addressed to the Director at the address maintained in the Company’s records. By a notice given pursuant to this Section 4.3, either party may hereafter designate a different address for notices to be given to such party. Any notice which is required to be given to the Director shall, if the Director is then deceased, be given to the Director’s personal representative if such representative has previously informed the Company of his status and address by written notice under this Section 4.3. Any notice shall be deemed duly given when sent via email or when sent by certified mail (return receipt requested) and deposited (with postage prepaid) in a post office or branch post office regularly maintained by the United States Postal Service.
Titles
Titles and captions are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement.
Amendment
This Agreement may be amended only by a writing executed by the parties hereto which specifically states that it is amending this Agreement.
Successors and Assigns.
The Company may assign any of its rights under this Agreement to single or multiple assignees, and this Agreement shall inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer herein set forth, this Agreement shall be binding upon the Director and his or her heirs, executors, administrators, successors and assigns
Governing Law
The laws of the State of Delaware shall govern the interpretation, validity, administration, enforcement and performance of the terms of this Agreement regardless of the law that might be applied under principles of conflicts of laws.
Limitations Applicable to Section 16 Persons.
Notwithstanding any other provision of the Plan or this Agreement, the Plan, the Units, the shares issuable hereunder and this Agreement shall be subject to any additional limitations set forth in any applicable exemptive rule under Section 16 of the Exchange Act (including any amendment to Rule 16b-3 of the Exchange Act) that are requirements for the application of such exemptive rule. To the extent permitted by applicable law, this Agreement shall be deemed amended to the extent necessary to conform to such applicable exemptive rule.
Conformity to Securities Laws.
The Director acknowledges that the Plan is intended to conform to the extent necessary with all provisions of the Securities Act and the Exchange Act and any and all regulations and rules promulgated by the Securities and Exchange Commission thereunder, and state securities laws and regulations. Notwithstanding anything herein to the contrary, the Plan shall be administered, and the Units and the shares issuable hereunder are to be issued, only in such a manner as to conform to such laws, rules and regulations. To the extent permitted by applicable law, the Plan and this Agreement shall be deemed amended to the extent necessary to conform to such laws, rules and regulations.
Counterparts
This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
Award Subject to Company Clawback or Recoupment.
To the extent permitted by applicable law, the Units shall be subject to clawback or recoupment pursuant to any compensation clawback or recoupment policy adopted by the Board or required by law during the term of the Director’s Service with the Company that is applicable to the Director. In addition to any other remedies available under such policy, applicable law may require the cancellation of the Units (whether vested or unvested) and the recoupment of any gains realized with respect to the Units.
No Special Rights
This Agreement does not, and shall not be interpreted to, create any right on the part of the Director to nomination, election or continued service as a director of the Company or any subsidiary or affiliate thereof, nor to any continued compensation, prerequisites or other current or future benefits or other incidents of such service nor shall it interfere with or restrict in any way any right or power, which is hereby expressly reserved, to remove or not to renominate the Director at any time for any reason whatsoever, with or without cause.
[End of Text]
EXHIBIT B
MAUI LAND & PINEAPPLE COMPANY, INC.
2017 EQUITY AND INCENTIVE AWARD PLAN
EXHIBIT C
MAUI LAND & PINEAPPLE COMPANY, INC.
2017 EQUITY AND INCENTIVE AWARD PLAN PROSPECTUS
EXHIBIT 10.13
MAUI LAND & PINEAPPLE COMPANY, INC.
2017 EQUITY AND INCENTIVE AWARD PLAN
RESTRICTED STOCK UNIT AWARD NOTICE
Maui Land & Pineapple Company, Inc., a Delaware corporation (the “Company”), pursuant to its 2017 Equity and Incentive Award Plan (the “Plan”), hereby grants to the director listed below (“Director”) the number of Restricted Stock Units (“Units”) listed below. This Restricted Stock Unit Award Notice is subject to all of the terms and conditions as set forth herein and in the Restricted Stock Unit Agreement attached hereto as Exhibit A (the “Agreement”) and the Plan, each of which are incorporated herein by reference. Unless otherwise defined herein, the terms defined in the Plan shall have the same defined meanings in this Restricted Stock Unit Award Notice (the “Award Notice”).
Director:
Award Date:
Total Number of Units:
| Vesting Schedule: | Subject to the provisions of the Agreement, the Director’s ownership interest in the Units shall vest, and the status of the Units as Unvested Units and all Restrictions with respect to the Units shall terminate, in accordance with the following schedule of events: | |||||
|
Vesting Event |
Incremental |
Total Shares Vested |
||||
|
March 31 after the Award Date |
25% |
25% |
||||
|
June 30 after the Award Date |
25% |
50% |
||||
|
September 30 after the Award Date |
25% |
75% |
||||
|
December 31 after the Award Date |
25% |
100% |
||||
|
Termination of the Director’s service as a director by vote of the Company’s stockholders for any reason other than Cause |
100%* |
|||||
|
Failure by the Board of Directors or any authorized committee thereof to nominate the Director for re-election for any reason other than for Cause |
100%* |
|||||
|
Failure of the Company’s stockholders to re-elect the Director |
100%* |
|||||
|
Death or Disability of the Director |
100%* |
|||||
|
If earlier than any of the above events, a Change in Control |
100%* |
|
||||
*or, if fewer, all Restricted Units
By his or her signature below, the Director agrees to be bound by the terms and conditions of the Plan, the Agreement and this Award Notice. The Director has reviewed the Agreement, the Plan and this Award Notice in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Award Notice and fully understands all provisions of this Award Notice, the Agreement and the Plan. The Director hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under or relating to the Plan, this Award Notice or the Agreement.
| MAUI LAND & PINEAPPLE COMPANY, INC.: | DIRECTOR: | ||||
| By: | |||||
| Print Name: | By: | ||||
| Title: | Print Name: | ||||
| Address: | |||||
| Address: | |||||
| Date: | |||||
| Attachments: | Restricted Stock Unit Award Agreement (Exhibit A) |
| Maui Land & Pineapple Company, Inc. 2017 Equity and Incentive Award Plan (Exhibit B) | |
| Maui Land & Pineapple Company, Inc. 2017 Equity and Incentive Award Plan Prospectus (Exhibit C) |
EXHIBIT A
RESTRICTED STOCK UNIT AWARD AGREEMENT
Pursuant to the Restricted Stock Unit Award Notice (“Award Notice”) to which this Restricted Stock Unit Award Agreement (this “Agreement”) is attached, Maui Land & Pineapple Company, Inc., a Delaware corporation (the “Company”), has granted to the director named in the Award Notice (the “Director”) the number Restricted Stock Units (“Units”) set forth in the Award Notice, upon the terms and conditions set forth in the Company’s 2017 Equity and Incentive Award Plan (the “Plan”), the Award Notice and this Agreement.
DEFINITIONS
The following terms used below in this Agreement shall have the meaning specified below unless the context clearly indicates to the contrary. Capitalized terms not otherwise defined herein shall have the meanings set forth in the Plan.
Cause
“Cause” means and shall be limited to (a) an affirmative vote of the holders of at least 75 percent of the shares entitled to vote at a meeting of stockholders called for the purpose, resolving that the Director should be removed from office or (b) a vote of the Board, the Nominating and Governance Committee, if any, or any other authorized committee of the Board resolving that the Director should not be nominated for re-election as a director, in either case, as a result of (i) conviction of a felony, (ii) declaration of unsound mind by order of a court, (iii) gross dereliction of duty, (iv) commission of any act involving moral turpitude or (v) commission of an act that constitutes intentional misconduct or a knowing violation of law if such action in either event results in both an improper substantial personal benefit to such Director and a material injury to the Company.
Disability
“Disability” shall mean the Director’s inability to perform his normal required services for the Company for a period of six consecutive months by reason of the individual’s mental or physical disability, as determined by the Administrator in good faith in its sole discretion.
Restrictions
“Restrictions” shall mean the restrictions set forth in Article III of this Agreement.
Secretary
“Secretary” shall mean the secretary of the Company.
Unvested Units
“Unvested Units” shall mean the Units issued under this Agreement for as long as such Units are subject to the Restrictions (as hereinafter defined) imposed by this Agreement.
RESTRICTED UNITS
Unvested Units
Any Units granted on the Award Date pursuant to this Agreement shall be considered Unvested Units for purposes of this Agreement and shall be subject to the Restrictions until such time or times and except to the extent that the Director’s ownership interest in Units vests in accordance with the Vesting Schedule set forth in the Award Notice.
Rights as Stockholder
From and after the Award Date, the Director shall not have any of the rights of a stockholder with respect to the Units until the Units are distributed to the Director in the form of Common Stock, except with respect to Dividend Equivalent rights as set forth on Section 2.3.
Dividend Equivalent Rights
All Units granted hereunder shall carry Dividend Equivalent rights which shall entitle the Director to receive additional Units, based on the amount of actual dividends payable by the Company with respect to the Common Stock. The amount of Dividend Equivalents credited to the Director’s Units shall be credited on the day following the dividend payment date for such dividend based on the Fair Market Value of a share of Common Stock on the payment date. Such additional Units shall also carry Dividend Equivalent rights. All additional Units credited to a Director’s account pursuant to this Section 2.3 shall be fully vested at all times.
RESTRICTIONS
Reversion of Unvested Units
Except as provided in clauses (a) through (e) of this sentence or in the following paragraph, any interest of the Director in Units that are Unvested Units shall immediately terminate if the Director’s service as a director of the Company terminates for any reason, unless such termination of service results from (a) death of the Director, (b) Disability of the Director, (c) removal of the Director from office by vote of the Company’s stockholders for any reason other than for Cause, (d) failure by the Board of Directors or any authorized committee thereof to nominate the Director for re-election for any reason other than for Cause or (e) failure of the Company’s stockholders to re-elect the Director.
Notwithstanding the provisions of the preceding paragraph, in the event that any Unvested Units are forfeited, the Director shall be entitled to payment with respect to any Units credited to his account pursuant to the Dividend Equivalent rights accrued on the Unvested Units in accordance with Section 2.3 before the date of such event.
Units Not Transferable
No Units, whether vested or unvested, or any interest or right therein or part thereof shall be liable for the debts, contracts or engagements of the Director or his successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such disposition be voluntary or involuntary or by operation of law or judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect; provided, however, that this Section 3.2 shall not prevent transfers by will or by applicable laws of descent and distribution until the Units are distributed to the Director in shares of Common Stock. Until such time when the shares of Common Stock are distributed to the Director, the Director’s rights under this Agreement shall be similar to that of an unsecured creditor of the Company.
Timing and Form of Distribution
To the extent not forfeited pursuant to Section 3.1, as soon as practicable (but not later than 30 days) after the vesting of the Units, in whole or in part, the Company shall issue or transfer to the Director the number of Shares underlying the vested Units. The Company may effect such issuance or transfer either by the delivery of one or more stock certificates to the Director or by making an appropriate entry on the books of the Company or the transfer agent of the Company.
MISCELLANEOUS
Conditions to Issuance of Stock
The Company shall not be required to issue or deliver any certificate or certificates or enter the Director’s name as the stockholder of record on the books of the Company for shares of stock pursuant to this Agreement prior to fulfillment of all of the following conditions:
The admission of such shares to listing on all stock exchanges on which such class of stock is then listed; and
The completion of any registration or other qualification of such shares under any state or Federal law or under rulings or regulations of the Securities and Exchange Commission or of any other governmental regulatory body, which the Company shall deem necessary or advisable; and
The obtaining of any approval or other clearance from any state or Federal governmental agency which the Company shall, in its absolute discretion, determine to be necessary or advisable.
Administration
The Board shall have the power to interpret the Plan and this Agreement and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith and to interpret, amend or revoke any such rules. All actions taken and all interpretations and determinations made by the Board in good faith shall be binding, conclusive and final upon the Director, the Company and all other interested persons. No member of the Board shall be personally liable for any action, determination or interpretation made in good faith with respect to the Plan, this Agreement or the Units.
Taxes.
The Director has reviewed with the Director’s own tax advisors the federal, state, local and foreign tax consequences of this investment and the transactions contemplated by the Award Notice and this Agreement. The Director is relying solely on such advisors and not on any statements or representations of the Company or any of its agents. The Director understands that the Director (and not the Company) shall be responsible for the Director’s own tax liability that may arise as a result of this investment or the transactions contemplated by this Agreement.
Adjustment for Stock Split.
In the event of any stock dividend, stock split, reverse stock split, recapitalization, combination, reclassification, or similar change in the capital structure of the Company, the Board shall make appropriate and equitable adjustments in the Units and the number of shares issuable under this Agreement, consistent with any adjustment under Section 11.3 of the Plan.
Notices
Any notice to be given under the terms of this Agreement to the Company shall be addressed to the Company in care of its Secretary, and any notice to be given to the Director shall be addressed to the Director at the address maintained in the Company’s records. By a notice given pursuant to this Section 4.3, either party may hereafter designate a different address for notices to be given to such party. Any notice which is required to be given to the Director shall, if the Director is then deceased, be given to the Director’s personal representative if such representative has previously informed the Company of his status and address by written notice under this Section 4.3. Any notice shall be deemed duly given when sent via email or when sent by certified mail (return receipt requested) and deposited (with postage prepaid) in a post office or branch post office regularly maintained by the United States Postal Service.
Titles
Titles and captions are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement.
Amendment
This Agreement may be amended only by a writing executed by the parties hereto which specifically states that it is amending this Agreement.
Successors and Assigns.
The Company may assign any of its rights under this Agreement to single or multiple assignees, and this Agreement shall inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer herein set forth, this Agreement shall be binding upon the Director and his or her heirs, executors, administrators, successors and assigns
Governing Law
The laws of the State of Delaware shall govern the interpretation, validity, administration, enforcement and performance of the terms of this Agreement regardless of the law that might be applied under principles of conflicts of laws.
Limitations Applicable to Section 16 Persons.
Notwithstanding any other provision of the Plan or this Agreement, the Plan, the Units, the shares issuable hereunder and this Agreement shall be subject to any additional limitations set forth in any applicable exemptive rule under Section 16 of the Exchange Act (including any amendment to Rule 16b-3 of the Exchange Act) that are requirements for the application of such exemptive rule. To the extent permitted by applicable law, this Agreement shall be deemed amended to the extent necessary to conform to such applicable exemptive rule.
Conformity to Securities Laws.
The Director acknowledges that the Plan is intended to conform to the extent necessary with all provisions of the Securities Act and the Exchange Act and any and all regulations and rules promulgated by the Securities and Exchange Commission thereunder, and state securities laws and regulations. Notwithstanding anything herein to the contrary, the Plan shall be administered, and the Units and the shares issuable hereunder are to be issued, only in such a manner as to conform to such laws, rules and regulations. To the extent permitted by applicable law, the Plan and this Agreement shall be deemed amended to the extent necessary to conform to such laws, rules and regulations.
Counterparts
This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
Award Subject to Company Clawback or Recoupment.
To the extent permitted by applicable law, the Units shall be subject to clawback or recoupment pursuant to any compensation clawback or recoupment policy adopted by the Board or required by law during the term of the Director’s Service with the Company that is applicable to the Director. In addition to any other remedies available under such policy, applicable law may require the cancellation of the Units (whether vested or unvested) and the recoupment of any gains realized with respect to the Units.
No Special Rights
This Agreement does not, and shall not be interpreted to, create any right on the part of the Director to nomination, election or continued service as a director of the Company or any subsidiary or affiliate thereof, nor to any continued compensation, prerequisites or other current or future benefits or other incidents of such service nor shall it interfere with or restrict in any way any right or power, which is hereby expressly reserved, to remove or not to renominate the Director at any time for any reason whatsoever, with or without cause.
[End of Text]
EXHIBIT B
MAUI LAND & PINEAPPLE COMPANY, INC.
2017 EQUITY AND INCENTIVE AWARD PLAN
EXHIBIT C
MAUI LAND & PINEAPPLE COMPANY, INC.
2017 EQUITY AND INCENTIVE AWARD PLAN PROSPECTUS
EXHIBIT 10.14
MAUI LAND & PINEAPPLE COMPANY, INC.
2017 EQUITY AND INCENTIVE AWARD PLAN
RESTRICTED STOCK UNIT AWARD NOTICE
Maui Land & Pineapple Company, Inc., a Delaware corporation (the “Company”), pursuant to its 2017 Equity and Incentive Award Plan (the “Plan”), hereby grants to the individual named below (“Grantee”) the number of Restricted Stock Units (“Units”) listed below. This Restricted Stock Unit Award Notice is subject to all of the terms and conditions as set forth herein and in the Restricted Stock Unit Agreement attached hereto as Exhibit A (the “Agreement”) and the Plan, each of which are incorporated herein by reference. Unless otherwise defined herein, the terms defined in the Plan shall have the same defined meanings in this Restricted Stock Unit Award Notice (the “Award Notice”).
Grantee:
Award Date:
Total Number of Units:
| Vesting Schedule: | Subject to the provisions of the Agreement, the Grantee’s ownership interest in the Units shall vest, in accordance with the following schedule of events: | |||||
|
Vesting Event |
Incremental |
Total Shares Vested |
||||
|
March 31 after the Award Date |
25% |
25% |
||||
|
June 30 after the Award Date |
25% |
50% |
||||
|
September 30 after the Award Date |
25% |
75% |
||||
|
December 31 after the Award Date |
25% |
100% |
||||
By his or her signature below, the Grantee agrees to be bound by the terms and conditions of the Plan, the Agreement and this Award Notice. The Grantee has reviewed the Agreement, the Plan and this Award Notice in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Award Notice and fully understands all provisions of this Award Notice, the Agreement and the Plan. The Grantee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under or relating to the Plan, this Award Notice or the Agreement.
| MAUI LAND & PINEAPPLE COMPANY, INC.: | GRANTEE: | ||||
| By: | |||||
| Print Name: | By: | ||||
| Title: | Print Name: | ||||
| Address: | |||||
| Address: | |||||
| Date: | |||||
| Attachments: | Restricted Stock Unit Award Agreement (Exhibit A) |
| Maui Land & Pineapple Company, Inc. 2017 Equity and Incentive Award Plan (Exhibit B) | |
| Maui Land & Pineapple Company, Inc. 2017 Equity and Incentive Award Plan Prospectus (Exhibit C) |
EXHIBIT A
RESTRICTED STOCK UNIT AWARD AGREEMENT
Pursuant to the Restricted Stock Unit Award Notice (“Award Notice”) to which this Restricted Stock Unit Award Agreement (this “Agreement”) is attached, Maui Land & Pineapple Company, Inc., a Delaware corporation (the “Company”), has granted to the grantee named in the Award Notice (the “Grantee”) the number Restricted Stock Units (“Units”) set forth in the Award Notice, upon the terms and conditions set forth in the Company’s 2017 Equity and Incentive Award Plan (the “Plan”), the Award Notice and this Agreement.
DEFINITIONS
The following terms used below in this Agreement shall have the meaning specified below unless the context clearly indicates to the contrary. Capitalized terms not otherwise defined herein shall have the meanings set forth in the Plan.
Cause
“Cause” means and shall be limited to (i) conviction of a felony, (ii) declaration of unsound mind by order of a court, (iii) gross dereliction of duty, (iv) commission of any act involving moral turpitude or (v) commission of an act that constitutes intentional misconduct or a knowing violation of law if such action in either event results in both an improper substantial personal benefit to such Grantee and a material injury to the Company.
Disability
“Disability” shall mean the Grantee’s inability to perform his normal required services for the Company for a period of six consecutive months by reason of the individual’s mental or physical disability, as determined by the Administrator in good faith in its sole discretion.
Restrictions
“Restrictions” shall mean the restrictions set forth in Article III of this Agreement.
Secretary
“Secretary” shall mean the secretary of the Company.
Unvested Units
“Unvested Units” shall mean the Units issued under this Agreement for as long as such Units are subject to the Restrictions (as hereinafter defined) imposed by this Agreement.
RESTRICTED UNITS
Unvested Units
Any Units granted on the Award Date pursuant to this Agreement shall be considered Unvested Units for purposes of this Agreement and shall be subject to the Restrictions until such time or times and except to the extent that the Grantee’s ownership interest in Units vests in accordance with the Vesting Schedule set forth in the Award Notice.
Rights as Stockholder
From and after the Award Date, the Grantee shall not have any of the rights of a stockholder with respect to the Units until the Units are distributed to the Grantee in the form of Common Stock, except with respect to Dividend Equivalent rights as set forth on Section 2.3.
Dividend Equivalent Rights
All Units granted hereunder shall carry Dividend Equivalent rights which shall entitle the Grantee to receive additional Units, based on the amount of actual dividends payable by the Company with respect to the Common Stock. The amount of Dividend Equivalents credited to the Grantee’s Units shall be credited on the day following the dividend payment date for such dividend based on the Fair Market Value of a share of Common Stock on the payment date. Such additional Units shall also carry Dividend Equivalent rights. All additional Units credited to Grantee’s account pursuant to this Section 2.3 shall be fully vested at all times.
RESTRICTIONS
Reversion of Unvested Units
Except as provided in the following paragraph, any interest of the Grantee in Units that are Unvested Units shall immediately terminate if the Grantee’s service as an Employee of the Company terminates for any reason, provided, however, that the Administrator in its sole and absolute discretion may provide that such Unvested Units shall not lapse in the event of a Change in Control or Termination of Employment without cause, following a Change in Control of the Company, or because of the Grantee’s retirement, death or disability, or otherwise.
Notwithstanding the provisions of the preceding paragraph, in the event that any Unvested Units are forfeited, the Grantee shall be entitled to payment with respect to any Units credited to his account pursuant to the Dividend Equivalent rights accrued on the Unvested Units in accordance with Section 2.3 before the date of such event.
Units Not Transferable
No Units, whether vested or unvested, or any interest or right therein or part thereof shall be liable for the debts, contracts or engagements of the Grantee or his successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such disposition be voluntary or involuntary or by operation of law or judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect; provided, however, that this Section 3.2 shall not prevent transfers by will or by applicable laws of descent and distribution until the Units are distributed to the Grantee in shares of Common Stock. Until such time when the shares of Common Stock are distributed to the Grantee, the Grantee’s rights under this Agreement shall be similar to that of an unsecured creditor of the Company.
Timing and Form of Distribution
To the extent not forfeited pursuant to Section 3.1, as soon as practicable (but not later than 30 days) after the vesting of the Units, in whole or in part, the Company shall issue or transfer to the Grantee the number of Shares underlying the vested Units. The Company may effect such issuance or transfer either by the delivery of one or more stock certificates to the Grantee or by making an appropriate entry on the books of the Company or the transfer agent of the Company.
MISCELLANEOUS
Conditions to Issuance of Stock
The Company shall not be required to issue or deliver any certificate or certificates or enter the Grantee’s name as the stockholder of record on the books of the Company for shares of stock pursuant to this Agreement prior to fulfillment of all of the following conditions:
The admission of such shares to listing on all stock exchanges on which such class of stock is then listed; and
The completion of any registration or other qualification of such shares under any state or Federal law or under rulings or regulations of the Securities and Exchange Commission or of any other governmental regulatory body, which the Company shall deem necessary or advisable; and
The obtaining of any approval or other clearance from any state or Federal governmental agency which the Company shall, in its absolute discretion, determine to be necessary or advisable.
Administration
The Board shall have the power to interpret the Plan and this Agreement and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith and to interpret, amend or revoke any such rules. All actions taken and all interpretations and determinations made by the Board in good faith shall be binding, conclusive and final upon the Grantee, the Company and all other interested persons. No member of the Board shall be personally liable for any action, determination or interpretation made in good faith with respect to the Plan, this Agreement or the Units.
Taxes.
The Grantee has reviewed with the Grantee’s own tax advisors the federal, state, local and foreign tax consequences of this investment and the transactions contemplated by the Award Notice and this Agreement. The Grantee is relying solely on such advisors and not on any statements or representations of the Company or any of its agents. The Grantee understands that the Grantee (and not the Company) shall be responsible for the Grantee’s own tax liability that may arise as a result of this investment or the transactions contemplated by this Agreement.
As a condition precedent to the issuance or transfer of any Shares upon the vesting of the Units, Grantee shall, upon request by the Company, pay to the Company such amount as the Company may be required under all applicable federal, state, local or other laws or regulations to withhold and pay over as income or other withholding taxes (“Tax Payments”) with respect to the issuance or transfer of such Shares. If Grantee shall fail to advance the Tax Payments after request by the Company, the Company may, in its discretion, deduct any Tax Payments from any amount then or thereafter payable by the Company to Grantee. Grantee may elect to satisfy his or her obligation to advance the Tax Payments by any of the following means: (1) a check or cash payment to the Company, (2) delivery to the Company previously owned shares having an aggregate Fair Market Value, determined as of the date on which such withholding obligation arises, equal to the Tax Payments, (3) authorizing the Company to withhold whole Shares which would otherwise be issued or transferred to Grantee having an aggregate Fair Market Value, determined as of the date on which such withholding obligation arises, equal to the Tax Payments, or (4) such other means as the Administrator may approve.
Adjustment for Stock Split.
In the event of any stock dividend, stock split, reverse stock split, recapitalization, combination, reclassification, or similar change in the capital structure of the Company, the Board shall make appropriate and equitable adjustments in the Units and the number of shares issuable under this Agreement, consistent with any adjustment under Section 11.3 of the Plan.
Notices
Any notice to be given under the terms of this Agreement to the Company shall be addressed to the Company in care of its Secretary, and any notice to be given to the Grantee shall be addressed to the Grantee at the address maintained in the Company’s records. By a notice given pursuant to this Section 4.3, either party may hereafter designate a different address for notices to be given to such party. Any notice which is required to be given to the Grantee shall, if the Grantee is then deceased, be given to the Grantee’s personal representative if such representative has previously informed the Company of his status and address by written notice under this Section 4.3. Any notice shall be deemed duly given when sent via email or when sent by certified mail (return receipt requested) and deposited (with postage prepaid) in a post office or branch post office regularly maintained by the United States Postal Service.
Titles
Titles and captions are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement.
Amendment
This Agreement may be amended only by a writing executed by the parties hereto which specifically states that it is amending this Agreement.
Successors and Assigns.
The Company may assign any of its rights under this Agreement to single or multiple assignees, and this Agreement shall inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer herein set forth, this Agreement shall be binding upon the Grantee and his or her heirs, executors, administrators, successors and assigns
Governing Law
The laws of the State of Delaware shall govern the interpretation, validity, administration, enforcement and performance of the terms of this Agreement regardless of the law that might be applied under principles of conflicts of laws.
Limitations Applicable to Section 16 Persons.
Notwithstanding any other provision of the Plan or this Agreement, the Plan, the Units, the shares issuable hereunder and this Agreement shall be subject to any additional limitations set forth in any applicable exemptive rule under Section 16 of the Exchange Act (including any amendment to Rule 16b-3 of the Exchange Act) that are requirements for the application of such exemptive rule. To the extent permitted by applicable law, this Agreement shall be deemed amended to the extent necessary to conform to such applicable exemptive rule.
Conformity to Securities Laws.
The Grantee acknowledges that the Plan is intended to conform to the extent necessary with all provisions of the Securities Act and the Exchange Act and any and all regulations and rules promulgated by the Securities and Exchange Commission thereunder, and state securities laws and regulations. Notwithstanding anything herein to the contrary, the Plan shall be administered, and the Units and the shares issuable hereunder are to be issued, only in such a manner as to conform to such laws, rules and regulations. To the extent permitted by applicable law, the Plan and this Agreement shall be deemed amended to the extent necessary to conform to such laws, rules and regulations.
Counterparts
This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
Award Subject to Company Clawback or Recoupment.
To the extent permitted by applicable law, the Units shall be subject to clawback or recoupment pursuant to any compensation clawback or recoupment policy adopted by the Board or required by law during the term of the Grantee’s employment with the Company that is applicable to the Grantee. In addition to any other remedies available under such policy, applicable law may require the cancellation of the Units (whether vested or unvested) and the recoupment of any gains realized with respect to the Units.
No Special Rights
This Agreement does not, and shall not be interpreted to, create any right on the part of the Grantee to continued employment by the Company or any subsidiary or affiliate thereof, nor to any continued compensation, prerequisites or other current or future benefits or other incidents of such service nor shall it interfere with or restrict in any way any right or power, which is hereby expressly reserved, to terminate Grantee at any time for any reason whatsoever, with or without cause.
[End of Text]
EXHIBIT B
MAUI LAND & PINEAPPLE COMPANY, INC.
2017 EQUITY AND INCENTIVE AWARD PLAN
EXHIBIT C
MAUI LAND & PINEAPPLE COMPANY, INC.
2017 EQUITY AND INCENTIVE AWARD PLAN PROSPECTUS
EXHIBIT 10.15
MAUI LAND & PINEAPPLE COMPANY, INC.
2017 EQUITY AND INCENTIVE AWARD PLAN
STOCK AWARD GRANT NOTICE OF ANNUAL INCENTIVE AWARD
Maui Land & Pineapple Company, Inc., a Delaware corporation (the “Company”), pursuant to its 2017 Equity and Incentive Award Plan (the “Plan”), hereby grants to the holder listed below (“Holder”) the number of shares of the Company’s common stock, par value $0.0001 (“Common Stock”), set forth below (the “Annual Incentive Award”). This Common Stock Award is subject to all of the terms and conditions as set forth herein and in the Plan, each of which are incorporated herein by reference. Unless otherwise defined herein, the terms defined in the Plan shall have the same defined meanings in this Stock Award Grant Notice (the “Grant Notice”).
Holder:
Grant Date:
Shares Price on Grant Date:
Stock Award Value for Year
Ending 12/31/20XX:
Gross Shares of Unrestricted
Stock:
Shares Net of Tax Issued:
|
Vesting Schedule: |
Fully vested on the Grant Date. |
[Remainder of page intentionally left blank]
By his or her signature below, Holder agrees to be bound by the terms and conditions of the Plan, the Restricted Stock Agreement and this Grant Notice. Holder has reviewed the Restricted Stock Agreement, the Plan and this Grant Notice in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Grant Notice and fully understands all provisions of this Grant Notice, the Restricted Stock Agreement and the Plan. Holder hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under or relating to the Plan, this Grant Notice or the Restricted Stock Agreement.
|
MAUI LAND & PINEAPPLE COMPANY, INC.: |
HOLDER: |
||
|
By: |
By: |
||
|
Print Name: |
Wade K. Kodama |
Print Name: |
|
|
Title: |
Chief Financial Officer |
||
|
Address: |
500 Office Road |
Address: |
|
|
Lahaina, Maui, Hawaii 96761 |
|||
|
Date: |
Date: |
||
|
Attachments: |
Restricted Stock Award Agreement (Exhibit A) |
|
Maui Land & Pineapple Company, Inc. 2017 Equity and Incentive Award Plan (Exhibit B) |
|
|
Maui Land & Pineapple Company, Inc. 2017 Equity and Incentive Award Plan Prospectus (Exhibit C) |
EXHIBIT A
RESTRICTED STOCK AWARD AGREEMENT
Pursuant to the Restricted Stock Award Grant Notice (“Grant Notice”) to which this Restricted Stock Award Agreement (this “Agreement”) is attached, Maui Land & Pineapple Company, Inc., a Delaware corporation (the “Company”), has granted to Holder the number of shares of the Company’s common stock, par value $0.0001 (“Stock”), set forth in the Grant Notice (the “Shares”), upon the terms and conditions set forth in the Company’s 2017 Equity and Incentive Award Plan (the “Plan”), the Grant Notice and this Agreement.
GENERAL
Defined Terms. Capitalized terms not specifically defined herein shall have the meanings specified in the Grant Notice or, if not defined therein, the Plan.
Incorporation of Terms of Plan. The Shares are subject to the terms and conditions of the Plan which are incorporated herein by reference.
GRANT OF RESTRICTED STOCK
Grant of Restricted Stock. In consideration of Holder’s past and/or continued service to the Company or its Subsidiaries and for other good and valuable consideration, effective as of the Grant Date set forth in the Grant Notice (the “Grant Date”), the Company hereby agrees to issue to Holder the Shares, upon the terms and conditions set forth in the Plan, the Grant Notice and this Agreement.
Issuance of Shares. The issuance of the Shares under this Agreement shall occur at the principal office of the Company simultaneously with, or as soon as practicable after, the execution of the Grant Notice by the parties or on such other date as the Company and Holder shall agree (the “Issuance Date”). Subject to the provisions of Article IV, the Company shall issue the Shares (which shall be issued in Holder’s name) on the Issuance Date.
Conditions to Issuance of Stock Certificates. The Shares, or any portion thereof, may be either previously authorized but unissued shares or issued shares which have then been reacquired by the Company. Such Shares shall be fully paid and nonassessable. The Company shall not be required to issue or deliver any Shares prior to fulfillment of all of the following conditions:
The admission of such Shares to listing on all stock exchanges on which the Stock is then listed;
The completion of any registration or other qualification of such Shares under any state or federal law or under rulings or regulations of the Securities and Exchange Commission or of any other governmental regulatory body, which the Board shall, in its absolute discretion, deem necessary or advisable;
The obtaining of any approval or other clearance from any state or federal governmental agency which the Board shall, in its absolute discretion, determine to be necessary or advisable;
The lapse of such reasonable period of time following the Issuance Date as the Board may from time to time establish for reasons of administrative convenience; and
The receipt by the Company of full payment for all amounts (if any) which, under federal, state or local tax law, the Company (or other employer corporation) is required to withhold upon issuance of such Shares.
Rights as Stockholder. Except as otherwise provided herein, upon delivery of the Shares to the escrow agent pursuant to Article IV, Holder shall have all the rights of a stockholder with respect to said Shares, subject to the restrictions herein, including the right to vote the Shares and to receive all dividends or other distributions paid or made with respect to the Shares; provided, however, that any and all extraordinary cash dividends paid on such Shares and any and all shares of Stock, capital stock or other securities or property received by or distributed to Holder with respect to the Shares as a result of any stock dividend, stock split, reverse stock split, recapitalization, combination, reclassification, or similar change in the capital structure of the Company shall also be subject to the Forfeiture Restriction (as defined in Section 3.1) and the restrictions on transfer in Section 3.4 until such restrictions on the underlying Shares lapse or are removed pursuant to this Agreement (or, if such Shares are no longer outstanding, until such time as such Shares would have been released from the Forfeiture Restriction pursuant to this Agreement). In addition, in the event of any merger, consolidation, share exchange or reorganization affecting the Shares, including, without limitation, a Change in Control, then any new, substituted or additional securities or other property (including money paid other than as a regular cash dividend) that is by reason of any such transaction received with respect to, in exchange for or in substitution of the Shares shall also be subject to the Forfeiture Restriction (as defined in Section 3.1) and the restrictions on transfer in Section 3.4 until such restrictions on the underlying Shares lapse or are removed pursuant to this Agreement (or, if such Shares are no longer outstanding, until such time as such Shares would have been released from the Forfeiture Restriction pursuant to this Agreement). Any such assets or other securities received by or distributed to Holder with respect to, in exchange for or in substitution of any Unreleased Shares (as defined in Section 3.3) shall be immediately delivered to the Company to be held in escrow pursuant to Section 4.1.
RESTRICTIONS ON SHARES
Forfeiture Restriction. Subject to the provisions of Section 3.2, if Holder has a Termination of Employment, Termination of Directorship, or Termination of Consultancy, applicable, for any or no reason, all of the Unreleased Shares (as defined in Section 3.3) shall thereupon be forfeited immediately and without any further action by the Company (the “Forfeiture Restriction”). Upon the occurrence of such a forfeiture, the Company shall become the legal and beneficial owner of the Shares being forfeited and all rights and interests therein or relating thereto, and the Company shall have the right to retain and transfer to its own name the number of Shares being forfeited by Holder. In the event any of the Unreleased Shares are forfeited under this Section 3.1, any cash, cash equivalents, assets or securities received by or distributed to Holder with respect to, in exchange for or in substitution of such Shares and held by the escrow agent pursuant to Section 4.1 and the Joint Escrow Instructions shall be promptly transferred by the escrow agent to the Company.
Release of Shares from Forfeiture Restriction. The Shares shall be released from the Forfeiture Restriction as indicated in the Grant Notice. Any of the Shares released from the Forfeiture Restriction shall thereupon be released from the restrictions on transfer under Section 3.4. In the event any of the Shares are released from the Forfeiture Restriction, any dividends or other distributions paid on such Shares and held by the escrow agent pursuant to Section 4.1 and the Joint Escrow Instructions shall be promptly paid by the escrow agent to Holder.
Unreleased Shares. Any of the Shares which, from time to time, have not yet been released from the Forfeiture Restriction are referred to herein as “Unreleased Shares.”
Restrictions on Transfer. Unless otherwise permitted by the Board pursuant to the Plan, no Unreleased Shares or any dividends or other distributions thereon or any interest or right therein or part thereof, shall be subject to sale or other disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such sale or other disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted sale or other disposition thereof shall be null and void and of no effect.
ESCROW OF SHARES
Escrow of Shares. To ensure the availability for delivery of Holder’s Unreleased Shares in the event of forfeiture of such Shares by Holder pursuant to Section 3.1, Holder hereby appoints the Secretary of the Company, or any other person designated by the Secretary or the Board as escrow agent, as his or her attorney-in-fact to assign and transfer unto the Company, such Unreleased Shares, if any, forfeited by Holder pursuant to Section 3.1 and any dividends or other distributions thereon, and shall, upon request by the Company, deliver and deposit with the Secretary of the Company, or such other person designated by the Board, any share certificates representing the Unreleased Shares, together with a stock assignment duly endorsed in blank. The Unreleased Shares and stock assignment shall be held by the Secretary of the Company, or such other person designated by the Board, in escrow, until the Unreleased Shares are forfeited by Holder as provided in Section 3.1, until such Unreleased Shares are released from the Forfeiture Restriction, or until such time as this Agreement no longer is in effect. Upon release of the Unreleased Shares from the Forfeiture Restriction, the escrow agent shall deliver to Holder the certificate or certificates representing such Shares in the escrow agent’s possession, and the escrow agent shall be discharged of all further obligations hereunder; provided, however, that the escrow agent shall nevertheless retain such certificate or certificates as escrow agent if so required pursuant to other restrictions imposed pursuant to this Agreement. If the Shares are held in book entry form, then such entry will reflect that the Shares are subject to the restrictions of this Agreement. If any dividends or other distributions are paid on the Unreleased Shares held by the escrow agent pursuant to this Section 4.1, such dividends or other distributions shall also be subject to the restrictions set forth in this Agreement and held in escrow pending release of the Unreleased Shares with respect to which such dividends or other distributions were paid from the Forfeiture Restriction.
Transfer of Forfeited Shares. Holder hereby authorizes and directs the Secretary of the Company, or such other person designated by the Secretary or the Board, to transfer the Unreleased Shares which have been forfeited by Holder to the Company.
No Liability for Actions in Connection with Escrow. The Company, or its designee, shall not be liable for any act it may do or omit to do with respect to holding the Shares in escrow while acting in good faith and in the exercise of its judgment.
OTHER PROVISIONS
Adjustment for Stock Split. In the event of any stock dividend, stock split, reverse stock split, recapitalization, combination, reclassification, or similar change in the capital structure of the Company, the Board shall make appropriate and equitable adjustments in the Unreleased Shares subject to the Forfeiture Restriction and the number of Shares, consistent with any adjustment under Section 11.3 of the Plan. The provisions of this Agreement shall apply, to the full extent set forth herein with respect to the Shares, to any and all shares of capital stock or other securities, property or cash which may be issued in respect of, in exchange for, or in substitution of the Shares, and shall be appropriately adjusted for any stock dividends, splits, reverse splits, combinations, recapitalizations and the like occurring after the date hereof.
Taxes. Holder has reviewed with Holder’s own tax advisors the federal, state, local and foreign tax consequences of this investment and the transactions contemplated by the Grant Notice and this Agreement. Holder is relying solely on such advisors and not on any statements or representations of the Company or any of its agents. Holder understands that Holder (and not the Company) shall be responsible for Holder’s own tax liability that may arise as a result of this investment or the transactions contemplated by this Agreement. Holder understands that Holder will recognize ordinary income for federal income tax purposes under Section 83 of the Code as the restrictions applicable to the Unreleased Shares lapse. In this context, “restriction” includes the Forfeiture Restriction. Holder understands that Holder may elect to be taxed for federal income tax purposes at the time the Shares are issued rather than as and when the Forfeiture Restriction lapses by filing an election under Section 83(b) of the Code with the Internal Revenue Service no later than thirty days following the date of purchase. A form of election under Section 83(b) of the Code is attached to the Grant Notice as Exhibit D.
HOLDER ACKNOWLEDGES THAT IT IS HOLDER’S SOLE RESPONSIBILITY AND NOT THE COMPANY’S TO TIMELY FILE THE ELECTION UNDER SECTION 83(b), EVEN IF HOLDER REQUESTS THE COMPANY OR ITS REPRESENTATIVES TO MAKE THIS FILING ON HOLDER’S BEHALF.
Limitations Applicable to Section 16 Persons. Notwithstanding any other provision of the Plan or this Agreement, the Plan, the Shares and this Agreement shall be subject to any additional limitations set forth in any applicable exemptive rule under Section 16 of the Exchange Act (including any amendment to Rule 16b-3 of the Exchange Act) that are requirements for the application of such exemptive rule. To the extent permitted by applicable law, this Agreement shall be deemed amended to the extent necessary to conform to such applicable exemptive rule.
Administration. The Board shall have the power to interpret the Plan and this Agreement and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith and to interpret, amend or revoke any such rules. All actions taken and all interpretations and determinations made by the Board in good faith shall be binding, conclusive and final upon Holder, the Company and all other interested persons. No member of the Board shall be personally liable for any action, determination or interpretation made in good faith with respect to the Plan, this Agreement or the Shares.
Restrictive Legends and Stop-Transfer Orders.
Any share certificate(s) evidencing the Shares issued hereunder shall be endorsed with the following legend and any other legend(s) that may be required by any applicable federal or state securities laws:
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO FORFEITURE IN FAVOR OF THE COMPANY AND MAY BE TRANSFERRED ONLY IN ACCORDANCE WITH THE TERMS OF A RESTRICTED STOCK AWARD AGREEMENT BETWEEN THE COMPANY AND THE STOCKHOLDER, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY.
Holder agrees that, in order to ensure compliance with the restrictions referred to herein, the Company may issue appropriate “stop transfer” instructions to its transfer agent, if any, and that, if the Company transfers its own securities, it may make appropriate notations to the same effect in its own records.
The Company shall not be required: (i) to transfer on its books any Shares that have been sold or otherwise transferred in violation of any of the provisions of this Agreement, or (ii) to treat as owner of such Shares or to accord the right to vote or pay dividends to any purchaser or other transferee to whom such Shares shall have been so transferred.
Tax Withholding.
The Company shall be entitled to require payment of any sums required by federal, state or local tax law to be withheld with respect to the transfer of the Shares or the lapse of the Forfeiture Restriction with respect to the Shares, or any other taxable event related thereto. The Company may permit Holder to make such payment in one or more of the forms specified below:
(i) by cash or check made payable to the Company;
(ii) by the deduction of such amount from other compensation payable to Holder;
(iii) by tendering Shares which are not subject to the Forfeiture Restriction and which have a then current Fair Market Value not greater than the amount necessary to satisfy the Company’s withholding obligation based on the minimum statutory withholding rates for federal, state and local income tax and payroll tax purposes; or
(iv) in any combination of the foregoing.
In the event Holder fails to provide timely payment of all sums required by the Company pursuant to Section 5.6(a), the Company shall have the right and option, but not obligation, to treat such failure as an election by Holder to provide all or any portion of such required payment by means of tendering Shares in accordance with Section 5.6(a)(iii).
Notices. Any notice to be given under the terms of this Agreement to the Company shall be addressed to the Company in care of the Secretary of the Company, and any notice to be given to Holder shall be addressed to Holder at the address given beneath Holder’s signature on the Grant Notice. By a notice given pursuant to this Section 5.7, either party may hereafter designate a different address for notices to be given to that party. Any notice shall be deemed duly given when sent via email or when sent by certified mail (return receipt requested) and deposited (with postage prepaid) in a post office or branch post office regularly maintained by the United States Postal Service.
Titles. Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement.
Governing Law; Severability. This Agreement shall be administered, interpreted and enforced under the laws of the State of Delaware without regard to conflicts of laws thereof. Should any provision of this Agreement be determined by a court of law to be illegal or unenforceable, the other provisions shall nevertheless remain effective and shall remain enforceable.
Conformity to Securities Laws. Holder acknowledges that the Plan is intended to conform to the extent necessary with all provisions of the Securities Act and the Exchange Act and any and all regulations and rules promulgated by the Securities and Exchange Commission thereunder, and state securities laws and regulations. Notwithstanding anything herein to the contrary, the Plan shall be administered, and the Shares are to be issued, only in such a manner as to conform to such laws, rules and regulations. To the extent permitted by applicable law, the Plan and this Agreement shall be deemed amended to the extent necessary to conform to such laws, rules and regulations.
Amendments. This Agreement may not be modified, amended or terminated except by an instrument in writing, signed by Holder and by a duly authorized representative of the Company.
Successors and Assigns. The Company may assign any of its rights under this Agreement to single or multiple assignees, and this Agreement shall inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer herein set forth, this Agreement shall be binding upon Holder and his or her heirs, executors, administrators, successors and assigns.
Award Subject to Company Clawback or Recoupment. To the extent permitted by applicable law, the Shares shall be subject to clawback or recoupment pursuant to any compensation clawback or recoupment policy adopted by the Board or required by law during the term of your employment or other Service with the Company that is applicable to you. In addition to any other remedies available under such policy, applicable law may require the cancellation of your Shares (whether vested or unvested) and the recoupment of any gains realized with respect to your Shares.
EXHIBIT B
MAUI LAND & PINEAPPLE COMPANY, INC.
2017 EQUITY AND INCENTIVE AWARD PLAN
EXHIBIT C
MAUI LAND & PINEAPPLE COMPANY, INC.
2017 EQUITY AND INCENTIVE AWARD PLAN PROSPECTUS
EXHIBIT 19.1
Insider Trading Policy
Maui Land & Pineapple Company, Inc.
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1. |
PURPOSE |
The purchase or sale of securities while possessing material nonpublic (“inside”) information or the disclosure of inside information (“tipping”) to others who may trade in such securities is sometimes referred to as “insider trading” and is prohibited by federal and state securities laws. Illegal insider trading occurs when a person buys or sells a security when in possession of inside information in violation of a duty of trust or confidence. As an essential part of your work, you may have or obtain access to inside information about Maui Land & Pineapple Company, Inc. (including information about other companies with which the Company does, or may do, business). When we refer in this Policy to “Maui Land & Pineapple” or the “Company,” we are referring to Maui Land & Pineapple Company, Inc. and any of its current or future subsidiaries.
Maui Land & Pineapple has adopted this Insider Trading Policy (“Policy”) to assist the Company in preventing illegal insider trading and to avoid even the appearance of improper conduct on the part of any director, officer, employee or contractor of the Company. This Policy is designed to protect and further Maui Land & Pineapple’s reputation for integrity and ethical conduct. However, the ultimate responsibility for complying with the securities laws, adhering to this Policy and avoiding improper transactions rests with you. It is imperative that you use your best judgment and that you ask questions where you are uncertain how to handle a particular situation.
The Board of Directors (the “Board”) has delegated to its Nominating and Corporate Governance Committee (the “Committee”) the responsibility of administering this Policy. The Committee may from time to time recommend to the Board changes to this Policy. All changes to this Policy must be approved by the Board. This Policy was amended and restated by the Board on March __, 2025.
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2. |
PENALTIES FOR INSIDER TRADING |
The penalties for violating the insider trading laws include imprisonment, disgorgement of profits gained or losses avoided, and substantial civil and criminal fines. As of the effective date of this Policy, an insider trading violation carries a maximum prison sentence of 20 years. Criminal fines can reach up to $5.0 million for individuals and $25.0 million for entities, and civil sanctions may include an injunction, industry bar, disgorgement and penalties of up to three times the profit gained or loss avoided. Individuals and entities considered to be “control persons” who knew or recklessly disregarded the fact that a “controlled person” was likely to engage in insider trading also may be civilly liable. As of the effective date of this Policy the civil liability of “control persons” can be the greater of (i) $1.0 million or (ii) three times the amount of the profit gained or loss avoided. For this purpose, a “control person” is an entity or person who directly or indirectly controls another person, and could include the Company, its directors and officers. Under some circumstances, individuals who trade on inside information may also be subjected to private civil lawsuits. Moreover, as the inside information of Maui Land & Pineapple is the property of the Company, trading on or tipping Maui Land & Pineapple’s confidential information could result in serious employment sanctions, up to and including termination of employment.
You should be aware that the Securities and Exchange Commission (“SEC”), the Financial Industry Regulatory Authority (“FINRA”) and stock exchanges use sophisticated electronic surveillance techniques to investigate and detect insider trading, and the SEC and the U.S. Department of Justice pursue insider trading violations vigorously. Cases involving trading through foreign accounts, trading by family members and friends, and trading involving only a small number of shares have been successfully prosecuted.
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3. |
SCOPE AND APPLICABILITY |
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3.1. |
Covered Persons. This Policy applies to each member of the Board and to all directors, officers, employees and, where appropriate in the Company's determination, contractors, within all of Maui Land & Pineapple’s operations. All persons covered by this Policy are referred to as “Covered Persons.” This Policy also applies to family members and domestic partners who share a household with a Covered Person. |
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3.2. |
Covered Securities and Transactions. Subject to the specific exceptions set forth in Section 5.2, this Policy applies to all transactions in the Company’s securities, including common stock and any other type of securities that are convertible into, exchangeable for or exercisable for common stock, such as preferred stock, convertible debt securities, warrants, and other derivative securities. This Policy applies to sales, purchases, gifts, exchanges, pledges, options, hedges, puts, calls and short sales, and any other transaction that purports to transfer the economic consequences of ownership. |
This Policy applies to all investment decisions you make regarding transactions in Company securities. For example, if you have the power to direct the purchase or sale of Company securities by virtue of your position as a director or officer of a corporation or non-profit organization, as a general partner of a partnership, as a managing member of a limited liability company (“LLC”), or as a trustee of a trust or executor of an estate, then all transactions in Company securities made on behalf of any such corporation, organization, partnership, LLC, trust or estate are covered by this Policy.
This Policy also applies to trading in securities of another company if you learn inside information about that company in the course of, or as a result of, your employment or association with Maui Land & Pineapple.
You are expected to comply with this Policy until such time as you no longer provide service to the Company and you no longer possess any inside information subject to this Policy. In addition, if you are subject to a trading blackout under this Policy at the time you cease to provide service to the Company, you are expected to abide by the applicable trading restrictions until at least the end of the relevant blackout period.
There may be instances where you suffer financial harm or other hardship or are otherwise required to forego a planned transaction because of the restrictions imposed by this Policy. Personal financial emergency or other personal circumstances are not mitigating factors under securities laws and will not excuse a failure to comply with this Policy. See Section 9.4 for additional information about selling Company securities in connection with a financial hardship.
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3.3. |
Delivery of the Policy. This Policy will be delivered to all new directors, officers, employees and, where appropriate in the Company's determination, contractors, at the commencement of their employment or association with the Company. |
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4. |
DEFINITIONS |
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4.1. |
Insider Trading. In general, “insider trading” occurs when a person purchases or sells a security while in possession of inside information in breach of a duty of trust or confidence owed directly or indirectly to the issuer of the security, the issuer’s stockholders or the source of the information. “Inside information” is information which is considered both “material” and “nonpublic.” Insider trading is a crime, may subject you to serious financial penalties and termination of employment, and is strictly prohibited by this Policy. Please refer to Section 2 of this Policy for additional information. |
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4.2. |
Materiality. A fact is considered “material” if (i) there is a substantial likelihood that a reasonable investor would consider it important in making a decision to buy, hold or sell securities, or (ii) disclosure of the information would be expected to significantly alter the total mix of the information in the marketplace about the issuer of the security. Material information can reflect either good or bad news and is not limited to financial information. While it is impossible to list all types of information that might be deemed “material” under particular circumstances, information dealing with the following subjects affecting the Company would generally be considered material: |
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4.2.1. |
projections of future revenues, expenses, margins, earnings, losses or liquidity position; |
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4.2.2. |
anticipated or actual Company financial results for a quarter and/or year; |
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4.2.3. |
restatements of financial results, or material impairments, write-offs or restructurings; |
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4.2.4. |
launch of new projects by the Company; |
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4.2.5. |
news of a pending or proposed joint venture, merger or acquisition; |
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4.2.6. |
news of a significant sale, disposition or write-downs of assets; |
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4.2.7. |
news of the execution or termination of significant contracts or other commercial arrangements with customers, distributors, suppliers, strategic partners, licensors or other third-parties; |
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4.2.8. |
changes in dividend policies or amounts, recapitalizations or stock splits; |
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4.2.9. |
offerings of securities or other financing developments; |
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4.2.10. |
repurchases of securities; |
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4.2.11. |
repayment or incurrence of indebtedness; |
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4.2.12. |
changes or proposed changes in senior management or other major personnel changes, labor disputes or negotiations; |
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4.2.13. |
regulatory developments affecting the Company’s operations, including land use entitlements, changes in zoning, environmental regulations or issuance of permits; |
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4.2.14. |
Timing of project development activities and any related delays; |
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4.2.15. |
developments in research and development or intellectual property; and |
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4.2.16. |
announcements of significant litigation or government investigations, including any change in status or the resolution thereof. |
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4.3. |
Nonpublic Information. Information is “nonpublic” if it has not been widely disclosed to the general public through major newswire services, national news services, financial news services, filings with the SEC, or other method that has been determined by the SEC to be compliant with Regulation FD. For purposes of this Policy, information will be considered public (i.e., no longer “nonpublic”) after the close of trading on the full trading day following the Company’s public release of the information. |
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4.4. |
Tipping. “Tipping” is the disclosure of material nonpublic information concerning the Company or its securities to an outside person. Providing insider information to anyone who thereafter trades on the basis of that information may subject both you (the “tipper”) and the other person (the “tippee”) to insider trading liability. |
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5. |
PROHIBITED ACTIVITIES |
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5.1. |
Prohibitions. Except for the limited exceptions described below, the following shall apply to all transactions in Company securities: |
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5.1.1. |
No Covered Person may purchase, sell, transfer or effectuate any other transaction in Company securities while in possession of inside information concerning the Company or its securities. This prohibition includes sales of shares received upon exercise of stock options, upon vesting of restricted stock, or upon settlement of restricted stock units. |
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5.1.2. |
No Covered Person may “tip” or disclose inside information concerning the Company or its securities to any outside person (including family members, affiliates, analysts, investors, members of the investment community and news media). Should a Covered Person inadvertently disclose such information to an outside person, the Covered Person must promptly inform the Compliance Officer (or, in the absence of the Compliance Officer, the Chief Executive Officer or, if applicable, the Chief Legal Officer) regarding this disclosure. In that event, the Company will either take steps necessary to (i) preserve the confidentiality of the information, including requiring the outside person to agree in writing to comply with the terms of this Policy and/or sign a confidentiality agreement, or (ii) disclose the information publicly in accordance with the requirements of Regulation FD. |
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5.1.3. |
No Covered Person may purchase Company securities on margin, hold Company securities in a margin account, or otherwise pledge Company securities as collateral for a loan because, in the event of a margin call or default on the loan, the broker or lender could sell the shares at a time when the Covered Person is in possession of inside information, resulting in liability for insider trading. The Compensation Committee of the Board may make exceptions to this prohibition on a case-by-case basis. |
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5.1.4. |
Short-term and speculative trading in Company securities, as well as hedging and other derivative transactions involving Company securities, can create the appearance of impropriety and may become the subject of an SEC or FINRA investigation. These types of transactions can also result in inadvertent violations of insider trading laws and/or liability for “short-swing” profits under Section 16(b) of the Securities Exchange Act of 1934 (“Exchange Act”). Therefore, it is the Company’s policy to prohibit the following activities, even if you are not in possession of inside information: |
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5.1.4.1. |
No Covered Person may trade in any interest or position relating to the future price of Company securities, such as put or call options or other derivative securities, or enter into any short sale of Company securities. |
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5.1.4.2. |
No Covered Person may hedge the value of Company securities. A “hedge” is a transaction designed to offset or reduce the risk of a decline in the market value of an equity security, and can include, but is not limited to, prepaid variable forward contracts, equity swaps, collars and exchange funds. |
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5.1.4.3. |
No Covered Person may trade in securities of the Company on an active basis, including short-term speculation. |
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5.1.5. |
No Covered Person may trade in securities of another company if the Covered Person is in possession of inside information about that other company which the Covered Person learned in the course of, or as a result of, his or her employment or association with Maui Land & Pineapple. |
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5.1.6. |
No Covered Person shall make any information about the Company publicly available, including by posting information about the Company on any Internet message board or social media site, except to the extent specifically authorized to do so. |
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5.2. |
Exceptions to Prohibited Activities. Prohibitions in trading securities under this Policy do not include: |
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5.2.1. |
The acceptance or purchase of stock options, restricted stock, restricted stock units or other equity awards issued or offered by the Company, and the vesting, cancellation or forfeiture of stock options, restricted stock, restricted stock units or other equity awards in accordance with applicable plans and agreements. |
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5.2.2. |
The exercise of vested stock options or warrants, either on a “cash for stock” or “stock for stock” basis, where no Company stock is sold (by the Covered Person, the Company or otherwise) to fund the option or warrant exercise. However, note that while vested stock options and warrants may be exercised at any time under this Policy, the sale of any stock acquired upon such exercise is subject to this Policy. |
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5.2.3. |
The receipt of Company stock upon vesting of restricted stock or settlement of restricted stock units, as well as the withholding of Company stock by the Company in payment of tax obligations, provided that no Company stock is sold (by the Covered Person, the Company or otherwise) in connection with the payment of tax obligations. |
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5.2.4. |
Elections with respect to participation in the Company’s employee stock purchase plan (“ESPP”) or to purchases of Company stock under the ESPP, provided that the sale of any stock acquired through the ESPP is subject to this Policy. |
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5.2.5. |
Company securities purchased or sold under a Rule 10b5-1 Trading Plan that has been approved in advance by the Compliance Officer (see Sections 8 and 10 below). |
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5.2.6. |
Transfers of Company stock by a Covered Person into a trust for which the Covered Person is a trustee, or from the trust back into the name of the Covered Person. |
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5.2.7. |
Transfers of Company securities by will or pursuant to the laws of descent and distribution. |
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5.2.8. |
Bona fide gifts of Company securities following receipt of written approval by the Compliance Officer (provided that the Compliance Officer shall retain the discretion to require the recipient to certify that it will comply with the terms of this Policy as a Covered Person). |
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5.2.9. |
Bona fide charitable donations to an organization that has obtained 501(c)(3) tax exempt status under the Internal Revenue Code following receipt of written approval by the Compliance Officer (provided that the Compliance Officer shall retain the discretion to require the organization to certify that it will comply with the terms of this Policy as a Covered Person). |
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5.2.10. |
Private securities transactions not expressly prohibited under Section 5.1. above between a Covered Person and a sophisticated party provided that (i) if it is proposed by the Covered Person that inside information is to be provided to the sophisticated party, any such information shall only be provided by the Company in the Company’s sole discretion, and then, if so disclosed, only after the party has entered into a non-disclosure agreement with the Company in form and substance satisfactory to the Company and (ii) the party agrees to any restrictions under the federal securities laws that the Company may impose on the party’s ability to effect transactions in any Company securities purchased by the party. |
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5.2.11. |
Purchases and sales of mutual funds, exchange traded funds or other similar funds or investment vehicles that invest in securities of the Company and with respect to which the Covered Person is a passive investor and has no rights with respect to the voting or disposition of any Company securities, and purchases and sales of Company securities by any such entity. |
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6. |
COMPANY COMPLIANCE OFFICER |
The Company has appointed the Chief Financial Officer as the Compliance Officer for this Policy. Any Covered Person who is unsure whether the information they possess constitutes inside information, or whether a specific transaction is covered by this Policy, should consult with the Compliance Officer for guidance. In the event that the Compliance Officer is not available, the Chief Executive Officer or, if applicable, the Chief Legal Officer, may perform the duties of the Compliance Officer hereunder. In addition, the Compliance Officer may designate one or more individuals to perform the Compliance Officer’s duties (which may include the Chief Executive Officer or, if applicable, the Chief Legal Officer). The determinations of the Compliance Officer or any designated individual, as applicable, under this Policy are final.
The duties and responsibilities of the Compliance Officer include the following:
|
6.1. |
Administering and interpreting this Policy and monitoring and enforcing compliance with all of its provisions and procedures. |
|
6.2. |
Responding to all inquiries relating to this Policy and its procedures. |
|
6.3. |
Designating and announcing special trading blackout periods during which trading in Company securities is prohibited by specific persons. |
|
6.4. |
Recommending revisions of this Policy (with the assistance of outside legal counsel as necessary) to reflect changes in applicable laws, regulations or listing standards, provided that all changes to this Policy must be approved by the Board. |
|
6.5. |
Annually providing or otherwise making available copies of this Policy to all Covered Persons and overseeing periodic training related to this Policy. |
|
6.6. |
Ensuring the maintenance of records required by the provisions of this Policy. |
|
6.7. |
Such other duties and responsibilities as are consistent with the terms of this Policy. |
|
7. |
CONFIDENTIALITY OF INFORMATION RELATING TO THE COMPANY |
|
7.1. |
Access to Information. Risk of insider trading violations by individuals employed or contracted with the Company can be substantially limited by restricting the pool of individuals with access to inside information to the greatest extent possible. Access to inside information about the Company should be limited to officers, directors, employees and contractors of the Company on a need-to-know basis. In addition, such information should not be communicated to anyone outside of the Company, unless such person has signed an appropriate non-disclosure agreement prior to dissemination of the information. When communication of inside information about the Company becomes necessary, all directors, officers, employees, and contractors must take care to emphasize the need for confidential treatment of such information and adherence to the Company’s policies with regard to confidential information. |
|
7.2. |
Disclosure of Information. Inside Company information is the property of Maui Land & Pineapple and the confidentiality of this information must be strictly maintained within the Company. Only the Company’s executive officers, as such are determined from time to time by the Board, are authorized to disclose inside information about the Company to the public, members of the investment community or stockholders, unless one of these officers has expressly authorized disclosure of such information by another employee in advance. All inquiries regarding the Company should be directed to the Chief Executive Officer, Chief Financial Officer, Chief Legal Officer, or other senior financial officers, and no other comment should be provided. |
|
8. |
PRE-CLEARANCE REQUIRED FOR TRADING BY COVERED PERSONS AND FOR TRADING PLANS ENTERED INTO BY COVERED PERSONS |
All Covered Persons must pre-clear all transactions in Company securities as provided below:
|
8.1. |
The Covered Person proposing to effectuate a trade or other transaction in Company securities must notify the Compliance Officer in writing of the proposed transaction prior to the proposed transaction date, in accordance with the instructions provided on Exhibit A, or as may otherwise be approved by the Compliance Officer and communicated to the Covered Person from time to time. |
|
8.2. |
The Compliance Officer must approve the proposed trade or other transaction in writing. If the proposed transaction is not completed within five trading days after the Covered Person has received pre-clearance (or fewer trading days, if so designated as a condition to receiving clearance), pre-clearance for the transaction (or any unfilled portion) must be re-requested since circumstances may have changed over that time period. |
|
8.3. |
The Compliance Officer’s decision with respect to the pre-clearance of a particular trade or other transaction, whether approved or denied, shall be final and shall be kept confidential by the requestor. |
All Covered Persons must pre-clear any Rule 10b5-1 trading plan (“Trading Plan”) as provided below:
|
8.4. |
Any Covered Person who wishes to implement a Trading Plan must first pre-clear the Trading Plan, and any renewals, amendments or modifications of the Trading Plan, with the Compliance Officer (or, in the case of the Compliance Officer, with the Committee). To obtain pre-clearance for implementing, renewing, amending or modifying any 10b5-1 Trading Plan please email the Company’s Compliance Officer and copy the Company’s stock plan administrator. |
|
8.5. |
The Compliance Officer must approve the Trading Plan, or any renewals, amendments or modifications, in writing. If the proposed Trading Plan is not entered into, renewed, amended or modified within five trading days after the Covered Person has received pre-clearance (or fewer trading days, if so designated as a condition to receiving clearance), pre-clearance for the Trading Plan must be re-requested since circumstances may have changed over that time period. |
For additional information regarding the adoption of a Trading Plan and the applicable requirements and limitations, see Section 10 below.
|
9. |
BLACKOUT PERIODS |
|
9.1. |
Regular Blackout Periods for Covered Persons. As a matter of good corporate governance, the Company institutes trading blackout periods during predetermined time periods. Covered Persons may not trade or effectuate any other transactions in Company securities during the period that begins with the day that is the fourteenth calendar day before the end of the fiscal quarter and continues until the close of trading on the second full trading day after the Company’s public release of quarterly or annual financial results. Trades or other transactions made pursuant to an approved 10b5-1 Trading Plan (but not the adoption, renewal, amendment, modification or termination of a 10b5-1 Trading Plan; see Section 10 below) and pursuant to a Hardship Exemption (see Section 9.4 below) are exempted from this restriction. |
|
9.2. |
Special Blackout Periods. From time to time, the Compliance Officer may determine that trading or transacting in Company securities is inappropriate during an otherwise open trading window due to the existence, or potential existence, of inside information. Accordingly, the Compliance Officer may prohibit trading or other transactions at any time by announcing a special blackout period and the scope of impacted personnel (which may include Covered Persons). The Compliance Officer will provide written notice of any modification of the trading blackout policy or any additional prohibition on trading during the period when trading or other transactions are otherwise permitted under this Policy. The existence of a special blackout period should be considered confidential information and any Covered Person to whom the special blackout period applies shall be prohibited from communicating the existence of the special blackout period to anyone to whom the special blackout period does not apply. |
|
9.3. |
Hardship Trading Exceptions. The Compliance Officer may, on a case-by-case basis, authorize trading or transactions in Company securities during a trading blackout period due to financial or other hardship. Any Covered Person wanting to rely on this exception must first notify the Compliance Officer in writing of the circumstance of the hardship and the amount and nature of the proposed trade or transaction. Such person will also be required to certify to the Compliance Officer in writing no earlier than two trading days prior to the proposed trade or transaction that they are not in possession of inside information concerning the Company or its securities. Upon authorization from the Compliance Officer, the person may trade or transact, although such person will be responsible for ensuring that any such trade or transaction complies in all other respects with this Policy. |
|
9.4. |
No Safe Harbors. There are no unconditional “safe harbors” for trades or transactions made at particular times, and all persons subject to this Policy must exercise good judgment at all times. Even when a regular blackout period is not in effect, you may be prohibited from engaging in any transactions involving the Company’s securities because you possess inside information concerning the Company or its securities, are subject to a special blackout period, or are otherwise restricted under this Policy. |
|
10. |
RULE 10B5-1 PLANS |
A Rule 10b5-1 Trading Plan is a contract to purchase, sell or otherwise transact securities according to a written instruction or plan established prior to effecting any transactions in the securities. In general, a Trading Plan must set forth a non-discretionary trading method by leaving the amount of securities to be purchased, sold or otherwise transacted and the price and date for each event to either (i) a written specification, (ii) a written formula, or (iii) a third party.
While adoption of a Trading Plan does not obviate the requirement to otherwise comply with insider trading laws, it does provide an affirmative defense to a claim that the insider acted on the basis of material, nonpublic information, even if an individual was aware of such information at the time of the transaction.
To be adopted in good faith, the Trading Plan must be adopted, renewed, amended or modified when the individual has no knowledge of inside information, and the plan must not be made as part of a scheme to fraudulently evade insider trading prohibitions.
In addition to obtaining pre-clearance of a Trading Plan as required by Section 8 above, a Trading Plan must meet the following requirements and specifications:
|
10.1. |
No Adoption During Blackout Period. A Trading Plan involving the Company’s securities may not be adopted, renewed, amended or modified by any Covered Person during any blackout period, even if the individual is not then in possession of any inside information. |
|
10.2. |
90-Day Cooling-Off Period for Directors and Officers: A Trading Plan adopted by any director or officer may not commence until both (i) the passage of at least 90 calendar days after the adoption, renewal, amendment, or modification of the Trading Plan, and (ii) the passage of at least two business days following the disclosure of the Company’s financial results in a Form 10-Q or Form 10-K for the fiscal quarter in which the Trading Plan was adopted, renewed, amended or modified (but in any event, the required cooling-off period is subject to a maximum of 120 calendar days after adoption, renewal, amendment or modification of the Trading Plan). |
|
10.3. |
Cooling-Off Period for Covered Persons Who are Not Directors and Officers: The Trading Plan of a Covered Person who is not a director or officer may not commence until the passage of at least 30 calendar days following the adoption, renewal, amendment or modification of the Trading Plan. |
|
10.4. |
Director and Officer Certifications: Any Trading Plan adopted by a director or officer must include a representation certifying that, at the time of the adoption, renewal, amendment or modification, the director or officer is: (i) not aware of material, nonpublic information about the Company or its securities; and (ii) adopting, renewing, amending or modifying the Trading Plan in good faith and not as part of a plan or scheme to evade the prohibitions of Rule 10b5-1. |
|
10.5. |
Prohibition on Multiple Overlapping Trading Plans: No multiple overlapping Trading Plans will be permitted unless qualifying for one of the following exceptions and pre-cleared by the Compliance Officer under Section 8: (i) a later-commencing Trading Plan that is not authorized to begin until after all trades under the earlier-commencing Trading Plan are completed or expired; or (ii) an outstanding or additional Trading Plan qualifies as an eligible sell-to-cover transaction (i.e., a sale of securities for the purpose of generating funds to cover the withholding taxes associated with equity vesting and elections under 401(K) plans or employee stock purchase plans that may be structured as Trading Plans). |
Any amendments or modifications to a Trading Plan must meet each of the requirements of a new Trading Plan as described above. In addition, while this Policy does not limit the ability of a Covered Person to terminate a previously adopted Trading Plan, any new Trading Plan adopted following the termination of a previously adopted Trading Plan must meet each of the requirements of a new Trading Plan as described above.
Transactions effected under an approved Trading Plan will not require further pre-clearance at the time of the transaction and will typically not be subject to future trading blackout periods (regular or special) that may be in effect under this Policy at the time of the transaction (although the Compliance Officer retains the discretion to terminate a Trading Plan during any blackout period).
The Compliance Officer may, from time to time, institute additional parameters and requirements regarding Trading Plans.
Purchases, sales and other transactions made pursuant to a Trading Plan must still comply with all other applicable reporting requirements under federal and state securities laws, including filings pursuant to Section 16 of the Exchange Act.
Newly adopted SEC rules require the Company to make disclosures concerning the Trading Plans adopted, renewed, amended, modified or terminated by its officers and directors, including names, titles, dates and duration of trading plans, and the aggregate number of securities to be sold or purchased pursuant to the trading plans. Accordingly, you must timely provide such information regarding your Trading Plan to the Compliance Officer.
EXHIBIT A
TRADING PRE-CLEARANCE INSTRUCTIONS
Pre-clearance for Covered Persons is mandatory. In addition to the steps outlined below, the individual requesting to trade must execute a certification (in the form approved by the Chief Legal Officer) that he, she or it is not aware of material, non-public information about the Company. If you have questions about the process by which pre-clearance must be obtained, please email the Compliance Officer.
Instructions for Pre-Clearance of Purchase or Sale of Maui Land & Pineapple Securities or Exercising Maui Land & Pineapple Stock Options/Warrants
For processing of your request to purchase or sell shares on the open market, or exercise options or warrants or other securities, please send an email request to the Compliance Officer.
If you are purchasing or selling shares on the open market, the Company requests that you place the following in the subject line of your email, as applicable: “Pre-Clearance Request - Purchase of Shares” or “Pre-Clearance Request - Sale of Shares”
The body of the email should contain the following:
|
o |
If a sale, the source and purchase date of the shares proposed to be sold; and |
|
o |
Estimated purchase or sale date. |
If you are exercising options or warrants and planning to sell on the open market, the Company requests that you place the following in the subject line of your email: “Pre-Clearance Request - Exercise of Options/Warrants”
The body of the email should contain the following:
|
o |
Type of security being exercised (e.g., stock option, warrant, etc.); |
|
o |
Estimated sale date; and |
|
o |
“Exercising and Selling” or “Exercising and Holding.” |
If you need any of the information requested above, please contact the Company’s Compliance Officer.
Please note that the ultimate responsibility for compliance with federal and state securities laws rests with you, and that the clearance of any proposed transaction should not be construed as a guarantee that you will not later be found to have been in possession of inside information.
Exhibit B
CERTIFICATION
I hereby certify that:
|
● |
I have read and understand the Company’s Insider Trading Policy. I understand that the Company’s Compliance Officer is available to answer any questions I have regarding this Insider Trading Policy. |
|
● |
Since the effective date of the Insider Trading Policy, or such shorter period of time that I have been a director, officer, employee or contractor of the Company, I have complied with the Insider Trading Policy. |
|
● |
I will continue to comply with the Company’s Insider Trading Policy for as long as I am a director, officer, employee or contractor of the Company. |
|
● |
I understand that failure to comply with the Insider Trading Policy could subject me to disciplinary action or termination of the business or employment relationship with Maui Land & Pineapple. |
| Signature | Date | ||
| Printed Name (Please print legibly) |
Exhibit 21.1
Maui Land & Pineapple Company, Inc.—Subsidiaries
As of December 31, 2024
|
Name |
State of |
Percentage Ownership |
||
|
Maui Pineapple Company, Ltd. |
Hawai‘i |
100 |
||
|
Kapalua Land Company, Ltd. |
Hawai‘i |
100 |
||
|
Kapalua Realty Company, Ltd. |
Hawai‘i |
100 |
||
|
Kapalua Advertising Company, Ltd. |
Hawai‘i |
100 |
||
|
BRE2 LLC (a Joint Venture) |
Hawai‘i |
60 |
||
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the incorporation by reference in Registration Statements No. 333 217538 and No. 333 273009 on Form S 8 of our report dated March 31, 2025, relating to the consolidated financial statements of Maui Land & Pineapple Company, Inc. and its subsidiaries (which report expresses unqualified opinions), appearing in this Annual Report on Form 10 K of Maui Land & Pineapple Company, Inc. for the years ended December 31, 2024 and 2023.
/s/ ACCUITY LLP
Honolulu, Hawaii
March 31, 2025
Exhibit 31.1
CERTIFICATION
I, Race A. Randle, certify that:
|
1. |
I have reviewed this Annual Report on Form 10-K of Maui Land & Pineapple Company, Inc. (the “Registrant”); |
|
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
|
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report; |
|
4. |
The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have: |
|
(a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
|
(b) |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
|
(c) |
Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
|
(d) |
Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and |
|
5. |
The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions): |
|
(a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and |
|
(b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting. |
|
Date: March 31, 2025 |
By: |
/s/ RACE A. RANDLE |
|
Race A. Randle |
Exhibit 31.2
CERTIFICATION
I, Wade K. Kodama, certify that:
|
1. |
I have reviewed this Annual Report on Form 10-K of Maui Land & Pineapple Company, Inc. (the “Registrant”); |
|
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
|
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report; |
|
4. |
The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have: |
|
(a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
|
(b) |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
|
(c) |
Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
|
(d) |
Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and |
|
5. |
The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions): |
|
(a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and |
|
(b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting. |
|
Date: March 31, 2025 |
By: |
/s/ WADE K. KODAMA |
|
Wade K. Kodama |
EXHIBIT 32.1
CERTIFICATION
In connection with the Annual Report of Maui Land & Pineapple Company, Inc. (the “Company”) on Form 10-K for the fiscal year ended December 31, 2024 as filed with the Securities and Exchange Commission on March 31, 2025 (the “Report”), I, Race A. Randle, Chief Executive Officer of the Company, certify, pursuant to Rule 13a-14(b) or Rule 15d-14(b) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 780(d)) and 18 U.S.C. Section 1350, that to the best of my knowledge:
1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
By: |
/s/ RACE A. RANDLE |
|
|
Race A. Randle |
||
|
March 31, 2025 |
This certification accompanies this Report pursuant to Rule 13a-14(b) or Rule 15d-14(b) under the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350 and shall not be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934.
EXHIBIT 32.2
CERTIFICATION
In connection with the Annual Report of Maui Land & Pineapple Company, Inc. (the “Company”) on Form 10-K for the fiscal year ended December 31, 2024, as filed with the Securities and Exchange Commission on March 31, 2025 (the “Report”), I, Wade K. Kodama, Chief Financial Officer of the Company, certify, pursuant to Rule 13a-14(b) or Rule 15d-14(b) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 780(d)) and 18 U.S.C. Section 1350, that to the best of my knowledge:
1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
By: |
/s/ WADE K. KODAMA |
|
|
Wade K. Kodama |
||
|
March 31, 2025 |
This certification accompanies this Report pursuant to Rule 13a-14(b) or Rule 15d-14(b) under the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350 and shall not be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934.
EXHIBIT 97.1
OFFICER ACKNOWLEDGEMENT & AGREEMENT
MAUI LAND AND PINEAPPLE COMPANY, INC. CLAWBACK POLICY
This Acknowledgement & Agreement (the “Acknowledgement”) is delivered by the undersigned named executive officer (“NEO”), as the date set forth below, to Maui Land and Pineapple Company, Inc. (the “Company”). The NEO is an officer (as defined under Section 16 of the Securities Exchange Act of 1934, as amended) of the Company and an employee of the Company or one of its subsidiaries.
Effective November 2, 2022, the Board of Directors (the “Board”) of the Company adopted a clawback policy, attached as Exhibit A hereto (as amended, restated, , or otherwise modified from time to time by the Board, the “Clawback Policy”). The Clawback Policy provides for the recoupment of certain compensation from officers in the event of (i) an accounting restatement resulting from material noncompliance with financial reporting requirements under applicable law, or (ii) other detrimental conduct that has caused or is likely to cause material financial, operational or reputational harm to the Company.
In consideration of the continued benefits to be received from the Company (and/or any subsidiary of the Company) and NEO’s right to participate in, and as a condition to the receipt of, Incentive Compensation (as defined in the Clawback Policy), NEO hereby acknowledges and agrees to the following:
|
1. |
NEO has read and understands the Clawback Policy and has had an opportunity to ask questions to the Company regarding the Clawback Policy. |
|
2. |
NEO agrees to be bound by and to abide by the terms of the Clawback Policy and intends for the Clawback Policy to be applied to the fullest extent of the law. |
|
3. |
The Clawback Policy shall apply to any and all Incentive Compensation that is approved, awarded or granted to NEO on or after November 2, 2022, and any Incentive Compensation that is outstanding as of November 2, 2022. |
|
4. |
In the event of any inconsistency between the provisions of the Clawback Policy and this Acknowledgement or any applicable incentive-based compensation arrangements, employment agreement, equity agreement or similar agreement or arrangement setting forth the terms and conditions of any Incentive Compensation, the terms of the Clawback Policy shall govern. |
No modifications, waivers, or amendments of the terms of this Acknowledgement shall be effective unless signed in writing by NEO and the Company. The provisions of this Acknowledgement shall inure to the benefit of the Company, and shall be binding upon, the successors, administrators, heirs, legal representatives and assigns of the NEO.
By signing below, NEO agrees to the application of the Clawback Policy and the other terms of this Acknowledgement.
| (Signature) | (Date) |
| (Name and Title) |
EXHIBIT A
MAUI LAND AND PINEAPPLE COMPANY, INC.
CLAWBACK POLICY
INTRODUCTION
The Board of Directors of the Company (the “Board”) believes that it is in the best interests of Maui Land and Pineapple Company, Inc., a Delaware corporation (together with its direct and indirect subsidiaries, the “Company”) and its stockholders to create and maintain a culture that emphasizes integrity and accountability, that reinforces the Company’s pay-for-performance compensation philosophy and deters wrongdoing. The Board has therefore adopted this Clawback Policy (this “Policy”) which provides for the recoupment of certain compensation in the event of (i) an accounting restatement resulting from material noncompliance with financial reporting requirements under the Federal securities laws, or (ii) other detrimental conduct that has caused or is likely to cause material financial, operational or reputational harm to the Company.
ADMINISTRATION
This Policy shall be administered by the Board or, if so designated by the Board, the Compensation Committee of the Board (the “Compensation Committee”), in which case references herein to the Board shall be deemed references to the Compensation Committee. Any determinations made by the Board shall be final and binding on all affected individuals.
COVERED EXECUTIVES
This Policy applies to any current or former officer of the Company who is (or was at any time from and after the Effective Time (as defined below)) subject to Section 16 of the Securities Exchange Act of 1934, as amended from time to time (each, a “Covered Executive”).
RECOUPMENT - ACCOUNTING RESTATEMENT
In the event the Company is required to prepare a restatement of its financial statements (“Accounting Restatement”) due in whole or in part to the Company’s material noncompliance with any financial reporting requirement under applicable law (including any rule or regulation promulgated thereunder), the Board may require reimbursement or forfeiture of any Excess Incentive Compensation (as defined below) deemed to have been received by any Covered Executive during the three completed fiscal years immediately preceding the date on which the Company is required to prepare an accounting restatement (the “Covered Period”). For the avoidance of doubt, in no event will a restatement of the Company’s financial statements that is not due in whole or in part to the Company’s material noncompliance with any financial reporting requirement under applicable law (including any rule or regulation promulgated thereunder) be considered an Accounting Restatement under this Policy. For example, a restatement due exclusively to a retrospective application of any one or more of the following will not be considered an Accounting Restatement under this Policy: (A) a change in accounting principles; (B) revision to reportable segment information due to a change in the structure of the Company’s internal organization; (C) reclassification due to a discontinued operation; (D) application of a change in reporting entity, such as from a reorganization of entities under common control; (E) adjustment to provision amounts in connection with a prior business combination; and (F) revision for stock splits.
For purposes of this Policy, “Incentive Compensation” means any (A) annual bonus or other short and long-term cash incentive that is earned, and (B) equity award that is vested, in each case, based (in whole or in part) on the attainment of one or more “financial reporting measures.” For these purposes, “financial reporting measures” are any measures used in preparing the Company’s financial statements or terms of compensation awards (or results that are derived from such measures), including, without limitation, (i) revenue, (ii) net income, (iii) earnings before interest, tax, depreciation and amortization, (iv) return on equity, (v) cash flows, (vi) stock price, and (vii) measures of shareholder return, in each case, whether absolute or relative. For the avoidance of doubt, a financial reporting measure need not be presented within the financial statements or included in a filing with the SEC.
Incentive Compensation will be deemed to have been “received” in the fiscal year during which the applicable financial reporting measure (as specified in the terms of the award) is attained, even if the payment occurs after the end of that fiscal year. In addition, the date on which the Company is required to prepare an Accounting Restatement will be deemed to have occurred on the earlier of (A) the date the Board concludes or reasonably should have concluded that the Company’s previously issued financial statements contain a material error, and (B) the date a court, regulator, or other legally authorized body directs the Company to restate its previously issued financial statements to correct a material error.
RECOUPMENT - DETRIMENTAL CONDUCT
In the event that a Covered Executive engages in Detrimental Conduct (as defined below) that, in the sole discretion of the Board, is likely to cause or has caused material financial, operational, or reputational harm to the Company, the Board may recover Incentive Compensation received by the Covered Executive from and after the date on which such Detrimental Conduct occurred. “Detrimental Conduct” consists of:
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i. |
the commission of an act of fraud, misappropriation, or embezzlement in the course of employment; |
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ii. |
the commission of a criminal act, whether or not in the course of employment or in the workplace, that constitutes a felony (or substantial equivalent thereof in a non-US jurisdiction) or other serious crime involving moral turpitude, dishonesty, or fraud; |
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iii. |
the material violation of a non-compete, non-solicitation, or confidentiality agreement; |
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iv. |
the material breach of the Company’s Code of Conduct (the “Code”) that could give rise to dismissal under the Code; or |
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v. |
any act or omission that resulted in such Covered Executive’s termination for Cause (as defined below). |
For the purposes of this Policy, “Cause” shall, as of any applicable date of determination, have the meaning ascribed to such term in the agreement and/or plan governing the most recent equity (or other long-term incentive) award granted to the applicable Covered Executive.
AMOUNT AND METHOD OF RECOVERY - NO ADDITIONAL PAYMENTS
The Board shall determine the amount of Incentive Compensation paid to be recovered in its sole discretion as follows:
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i. |
In the event of recoupment due to an Accounting Restatement, up to the sum of (x) the amount (if any) by which the Incentive Compensation received exceeds the amount that would have been received if calculated based upon the financial reporting measures had such error(s) not been made (“Excess Incentive Compensation”), and (y) to the extent that the Board determines that the Accounting Restatement is due in any material respect to the actions, or failure to taken action, of a Covered Executive, any costs incurred by the Company in connection with such Accounting Restatement (including, without limitation, any legal, audit and accounting fees incurred in investigating and preparing such Accounting Restatement, any fees incurred in responding or defending any claims relating in whole or in part to the Accounting Restatement or the facts or circumstances relating thereto, and any amounts paid in settlement of or on account of any judgment relating to any such claims). For Incentive Compensation based in part of whole on stock price or measures of shareholder return, Excess Incentive Compensation will be calculated in such manner as the Board deems appropriate in its sole discretion under the circumstances. |
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ii. |
In the event of recoupment due to Detrimental Conduct, an amount of Incentive Compensation up to and based upon the Covered Person’s relative degree of fault or involvement, the impact of the conduct on the Company, the magnitude of any loss caused and other relevant facts and circumstances. |
In no event shall the Company be required to award Covered Executives an additional payment if the restated or accurate financial results would have resulted in a higher incentive compensation payment.
If Incentive Compensation in the form of an equity award is recoverable pursuant to this Policy, the Company will be entitled to: (A) if the equity award is still outstanding, cause the Covered Executive to forfeit the award; (B) if the equity award has been exercised or settled into shares (the “Underlying Shares”) and the Covered Executive still holds the Underlying Shares, recover the number of Underlying Shares (less any exercise price, if any, paid in cash for the Underlying Shares); and (C) if the Underlying Shares have been sold by the Covered Executive, recover the after-tax portion of the proceeds received by the Covered Executive from the sale of the Underlying Shares (less any exercise price, if any, paid in cash for the Underlying Shares).
In addition, the Board may determine, in its sole discretion, any additional method for recouping Incentive Compensation hereunder which may include, without limitation: (A) requiring reimbursement of cash Incentive Compensation previously paid; (B) offsetting the recouped amount from any compensation otherwise owed by the Company to the Covered Executive; or (C) taking any other remedial and recovery action permitted by law, as determined by the Board.
NO INDEMNIFICATION
The Company shall not indemnify any Covered Executives against (i) the loss of any incorrectly awarded Incentive Compensation or any Incentive Compensation that is recouped pursuant to the terms of this Policy, or (ii) any claims relating to the Company’s enforcement of its rights under this Policy.
INTERPRETATION
The Board is authorized to interpret and construe this Policy and to make all determinations necessary, appropriate, or advisable for the administration of this Policy.
EFFECTIVE DATE
This Policy shall be effective as of November 2, 2022 (the “Effective Date”) and shall apply to any and all Incentive Compensation that is approved, awarded or granted to Covered Executives on or after that date and any Incentive Compensation that is outstanding as of the Effective Date.
AMENDMENT - TERMINATION
The Board may amend this Policy from time to time in its discretion and shall amend this Policy as it deems necessary, including as and when it determines that it is legally required by Securities and Exchange Commission rule or the rules of any national securities exchange on which the Company’s securities are listed. The Board may terminate this Policy at any time.
OTHER RECOUPMENT RIGHTS - NO ADDITIONAL PAYMENTS
The Board intends that this Policy will be applied to the fullest extent of the law. The Board may require that any employment agreement, equity award agreement, or similar agreement entered into on or after the Effective Date shall, as a condition to the grant of any benefit thereunder, require a Covered Executive to agree to abide by the terms of this Policy. Any right of recoupment under this Policy is in addition to, and not in lieu of, any other remedies or rights of recoupment that may be available to the Company pursuant to the terms of any similar policy in any employment agreement, equity award agreement, or similar agreement and any other legal remedies available to the Company.
IMPRACTICABILITY
The Board shall have the sole discretion to consider all facts and circumstances in determining whether to recover any Incentive Compensation in accordance with this Policy. In determining whether to require reimbursement or forfeiture, and if so, the amount of such reimbursement or forfeiture, the Board may take into account such considerations as it deems appropriate, including, without limitation: (A) the likelihood of success in seeking reimbursement or forfeiture under governing law relative to the effort involved; (B) whether the assertion of a reimbursement or forfeiture claim may prejudice the interests of the Company in any related proceeding or investigation, or otherwise; (C) whether the expense of seeking reimbursement or forfeiture is likely to exceed the amount sought or likely to be recovered; (D) the passage of time since the occurrence of any acts or omissions giving rise, directly or indirectly, to the Accounting Restatement or Detrimental Conduct; (E) any pending or threatened legal proceeding relating to any acts or omissions giving rise, directly or indirectly, to the Accounting Restatement or Detrimental Conduct, and any actual or anticipated resolution (including any settlement) relating thereto; and (F) such other factors as it may deem appropriate under the circumstances.
SUCCESSORS
This Policy shall be binding and enforceable against all Covered Executives and their beneficiaries, heirs, executors, administrators, or other legal representatives.
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