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 UNITED STATES

 SECURITIES AND EXCHANGE COMMISSION

 Washington, D.C. 20549

 FORM 10-K

 [ X ]

 Annual Report Pursuant to Section 13 or 15(d)
 of the Securities Exchange Act of 1934

 for the fiscal year ended December 31, 2024

 or

 [ ]

 Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 For the transition period from _____ to _____

 Commission file number: 0-50273

 (Exact name of registrant as specified in its
charter)

 Delaware

 (State or other jurisdiction

 of incorporation or organization)

 01-0731997

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

 900 N. Michigan Ave., Chicago, Illinois

 (Address of principal executive offices)

 60611

 (Zip Code)

 Registrant's telephone number, including area
code 312 - 915-1987

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

 Title of each class

 Trading Symbol(s)

 Name of each exchange on

 which registered

 N/A

 N/A

 N/A

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

 Limited Liability Company Interests (Class
A Shares)

 (Title of Class)

 Indicate by check mark if the registrant is a
well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes [ ] No [ X ]

 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 [ ] No [ X ]

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

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

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

 Large accelerated filer

 [ ]

 Accelerated filer

 [ ]

 Non-accelerated filer

 [ X ]

 Smaller reporting company

 [ X ]

 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. Yes [ ] No [ ]

 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 checkmark 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 Act). Yes [ ] No [ X ]

 State the aggregate market value of the voting
and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the
average bid and asked price of such common equity, as of the last business day of the registrant's most recently completed second fiscal
quarter. Not applicable.

 As of March 24, 2025, the registrant had 1,792,613
Common Shares and 52,000 Class C Shares outstanding.

 Documents incorporated by reference: None

 Page

 Item 1.

 Business

 Item 1A.

 Risk Factors

 Item 1B.

 Unresolved Staff Comments

 Item 1C.

 Cybersecurity

 Item 2.

 Properties

 Item 3.

 Legal Proceedings

 Item 4.

 Mine Safety Disclosures

 Item 5.

 Market
 for Registrant's Common Equity, Related Stockholders Matters and Issuer Purchases of Equity Securities

 Item 6.

 [Reserved]

 Item 7.

 Management's Discussion and Analysis
 of Financial Condition and Results of Operations

 Item 7A.

 Quantitative and Qualitative Disclosures About Market Risk

 Item 8.

 Financial Statements and Supplementary Data

 Item 9.

 Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

 Item 9A.

 Controls and Procedures

 Item 9B.

 Other Information

 Item 9C.

 Disclosure Regarding Foreign Jurisdictions that Prevent Inspections `

 Item 10.

 Directors, Executive Officers and Corporate Governance

 Item 11.

 Executive Compensation

 Item 12.

 Security Ownership of Certain Beneficial
 Owners and Management and Related Stockholder Matters

 Item 13.

 Certain Relationships and Related Transactions, and Director Independence

 Item 14.

 Principal Accountant Fees and Services

 Item 15.

 Exhibit and Financial Statement Schedules

 Item 16.

 Form 10-K Summary

 Signatures

 Item 1. Business

 Kaanapali Land, LLC ("Kaanapali
Land" or the "Company"), a Delaware limited liability company, is the reorganized entity resulting from the Joint Plan
of Reorganization of Amfac Hawaii, LLC (now known as KLC Land Company, LLC ("KLC Land")), certain of its subsidiaries (together
with KLC Land, the "KLC Debtors") and FHT Corporation ("FHTC" and, together with the KLC Debtors, the "Debtors")
under Chapter 11 of the Bankruptcy Code, dated June 11, 2002 (as amended, the "Plan"). The Plan was filed jointly by
all Debtors to consolidate each case for joint administration in the Bankruptcy Court in order to (a) permit the petitioners to present
a joint reorganization plan that recognized, among other things, the common indebtedness of the debtors (i.e. the Certificate of Land
Appreciation Notes ("COLAs") and Senior Indebtedness (as defined in the Plan)) and (b) facilitate the overall administration
of the bankruptcy proceedings. As indicated in the Plan, Kaanapali Land has elected to be taxable as a corporation.

 The Plan was confirmed by
the Bankruptcy Court by orders dated July 29, 2002 and October 30, 2002 (collectively, the "Order") and became effective
November 13, 2002 (the "Plan Effective Date"). During August 2005, pursuant to a motion for entry of final decree, the
bankruptcy cases were closed.

 The Company operates in two
primary business segments: (i) Property and (ii) Agriculture. The Company operates through a number of subsidiaries, each of which is
owned directly or indirectly by Kaanapali Land.

 KLC Land is the direct subsidiary
of Kaanapali Land through which the Company conducts substantially all of its remaining operations. KLC Land conducts substantially all
of its business through various subsidiaries. Those subsidiaries with remaining assets of significant net value include KLC Holding Corp.
("KLC"), Pioneer Mill Company, LLC ("PMC"), and Kaanapali Land Management Corp. ("KLMC" formerly known as
Kaanapali Development Corp.).

 All dollar amounts are in
thousands of dollars unless otherwise noted.

 Project Planning and Development.
The Company's real estate development approach, for land that it holds for development rather than investment, is designed to enhance
the value of its properties in phases. In most instances, the process begins with the preparation of market and feasibility studies that
consider potential uses for the property, as well as costs associated with those uses. The studies consider factors such as location,
physical characteristics, demographic patterns, anticipated absorption rates, transportation, infrastructure costs, both onsite and offsite,
and regulatory and environmental requirements.

 For any property targeted
for development, the Company will generally prepare a land plan that is consistent with the findings of the studies and then commence
the process of applying for the entitlements necessary to permit the use of the property in accordance with the land plan. The length
and difficulty of obtaining the requisite entitlements by government agencies, as well as the cost of complying with any conditions attached
to the entitlements, are significant factors in determining the viability of the Company's projects. Applications for entitlements may
include, among other things, applications for state land use reclassification, Maui County (the "County") community plan amendments,
changes in zoning, and if applicable, subdivision.

 Pioneer Mill Site.
The Company owns approximately 19 acres in Lahaina, known as the Pioneer Mill Site, which is zoned primarily industrial. This is the former
site of PMC's sugar mill on Maui and was the site of the coffee mill operation. In addition, portions of this parcel were subject
to various short-term license agreements with third parties that generated income for the Company. As discussed below, the site was negatively
impacted by the Lahaina wildfire.

 On June 13, 2024, PMC
entered into a property sale agreement ("PMC Sales Agreement") with an unrelated third party for the sale of four
parcels of land, aggregating approximately 20 acres (the "PMS land parcels") located in Lahaina, Hawaii. Pursuant to the
PMC Sales Agreement, the sales price for the PMS land parcels is $20 million, and the closing of the sale of the PMS land parcels is
subject to the due diligence period. On August 12, 2024, pursuant to an amendment to the PMC Sales Agreement, the due diligence
period was extended to October 2, 2024. On October 2, 2024, pursuant to a Second Amendment to the PMC Sales Agreement, the due
diligence period was extended to November 1, 2024. On October 31, 2024, pursuant to a Third Amendment to the PMC Sales
Agreement, the PMC Sales Agreement was modified to extend the deadline for the purchaser to deliver the Notice to Proceed to
November 29, 2024. A notice to proceed was received from the purchaser in accordance with the PMC Sales Agreement, as amended. The
purchaser has deposited a total of $2 million into an escrow account, managed by a title company, established for the sale of the
property. As noted below, the property is currently leased by a USACE contractor and was used as a base yard for the clean-up of
Lahaina. The lease term expires July 2025 with an option to extend for six months. The purchaser has the right to terminate the PMC
Sales Agreement depending on various factors, including environmental testing of the property which will commence after the
subcontractor vacates the property. As the PMC Sales Agreement is subject to certain conditions, including the results of the
environmental testing, there can be no assurance that the sale of the PMS land parcels will be completed under the existing or any
other terms of the PMC Sales Agreement, if at all.

 Lahaina Wildfire. Beginning
on August 8, 2023, a wildfire occurred due east of historic Lahaina town in Maui. The fire spread rapidly due to extreme wind conditions
caused in part by Hurricane Dora which traveled 800 miles offshore west of Maui. The fires caused multiple fatalities, widespread damage
to Lahaina town and the surrounding area including the Company's 19-acre Pioneer Mill Site. The Company's offices and coffee
mill were located on the site as well as various other structures and a building which was leased to an unrelated third party and used
to operate a coffee store. The Company also utilized portions of the property for short term license agreements with third parties that
generated income for the Company. Although no employees were injured in the fire, the Company's offices and coffee store building
were destroyed. Additionally, most of the personal property of the licensees and the coffee mill was destroyed. The widespread destruction
has caused disruptions in the Company's development plans. The damage to the coffee mill has disrupted operations and prevented
the Company from processing and selling the 2023 and 2024 year coffee crop. It is also likely that the fires and devastation caused thereby
will adversely affect the long-term Maui economy and businesses operated on Maui. Maui hotel occupancy and average daily rates have declined
significantly during 2024 as the Lahaina wildfire continues to disrupt tourism. Maui's recovery from the wildfire remains slow.
Clean up of Lahaina has been substantially completed by U.S. Army Corps of Engineers ("USACE") contractors. The property is
currently leased by a USACE contractor and was used as a base yard for the clean-up of Lahaina. The lease term expires July 2025 with
an option to extend for six months. During 2023, the Company initiated claims with its insurance carriers and in October 2023, the Company
received an initial, unallocated advance payment of $1 million, in June 2024, the Company received approximately $4.9 million and in August
2024 received approximately $1.1 million from its insurance carrier. Although the Company currently expects that the Company's insurance
coverage will compensate the Company for the majority of its losses incurred in connection with the fire and related devastation, including
the costs of its structures and equipment lost in the fire, the loss in revenue from the lack of coffee sales and the loss of income from
the licensees, there can be no assurances the Company will be fully compensated for such losses. The Company could experience losses in
excess of its insured limits, and further claims for certain losses could be denied or subject to deductibles or exclusions under its
insurance policies. The Company has relocated its offices to temporary office facilities located on its lands in Kaanapali and is in the
planning and design stages of relocating its coffee mill to its farm in Kaanapali.

 Kaanapali 2020 Development
Plan. The Company's developable lands are located on the west side of the Island of Maui in the State of Hawaii. The majority of the
developable lands are located near to the Kaanapali resort area. The Kaanapali development lands have been the subject of a community-based
planning process that commenced in 1999 for the Kaanapali 2020 Development Plan. The Kaanapali 2020 Development Plan includes a mix of
residential (including workforce affordable housing), commercial, quasi-public facilities, recreation, agriculture, rural, and open space.
Any development plan for any of the Company's land, including the Kaanapali 2020 Development Plan, will be subject to approval and regulation
by various state and County agencies and governing entities, especially insofar as the nature and extent of zoning, and improvements necessary
for site infrastructure, building, transportation, water management, environmental and health are concerned. A substantial portion of
the Company's Kaanapali 2020 Development Plan land will require state district boundary amendments and county general plan and community
plan amendments, as well as rezoning approvals. In Hawaii, the governmental entities may impose limits or controls on growth in their
communities during the review and consideration of the various entitlement processes mainly through restrictive conditions, including
limitations on density, impact fees, infrastructure contribution, among others, all of which may materially affect utilization of the
land and the costs associated with developing the land. In addition, the County currently requires certain percentages and levels of affordability
to be included in proposed residential developments or subdivisions of land, thereby affecting the feasibility of these projects. There
can be no assurance that the Company will be successful in obtaining the necessary zoning and related entitlements for development of
any currently unentitled Maui lands. At this time, the only Kaanapali 2020 Development Plan land that has sufficient entitlements to commence
development is the Puukolii Village Mauka development, as described below.

 The current regulatory approval
process for a development project takes a number of years or more and involves substantial expense. The applications generally require
the submission of comprehensive plans that involve the use of consultants and other professionals. A substantial portion of the Company's
Kaanapali 2020 Development Plan land will require state district boundary amendments and county general plan and community plan amendments,
as well as rezoning approvals. There is no assurance that all necessary approvals and permits will be obtained with respect to the current
projects or future projects of the Company. Generally, entitlements are extremely difficult to obtain in Hawaii. There is often significant
opposition to proposed developments from numerous local groups, environmental organizations, various community and civic groups, condominium
associations and politicians advocating no-growth policies, among others. Any such group with standing can challenge submitted applications,
which may substantially delay the process. Generally, once the applications are deemed acceptable, the various governing agencies involved
in the entitlement process commence consideration of the requested entitlements. The applicable agencies often impose conditions, which
may be costly and time consuming, on any approvals of the entitlements. The substantial time and expense of obtaining entitlements and
the uncertainty of success in obtaining the entitlements could have a material adverse effect on the Company's success.

 At the state level, all land
in Hawaii is divided into four land use classifications: urban, rural, agricultural and conservation. The majority of the Kaanapali 2020
Development Plan land is currently classified as either agricultural or conservation.

 Despite the hurdles mentioned
above, the Company remains hopeful that it will generally be able to develop that portion of its land for which it can obtain classification
as an urban district from the State Land Use Commission. However, it is uncertain whether the Company will be able to obtain all necessary
entitlements or, if so, how long it will take, and it cannot be predicted what the market will be for such land (or the associated development
costs) at such time. Conservation land is land that has been considered by the state as necessary for preserving natural conditions as
well as to protect water resources and cannot be developed. Lands within agricultural and rural districts have limited development potential,
especially as it relates to density and use. Pursuant to the Kaanapali 2020 Development Plan, the Company intends to apply to the State
Land Use Commission for reclassification of a portion of the agricultural lands to urban, and perhaps some rural, but does not intend
to apply for reclassification of the conservation lands.

 During 2012, the County updated
its General Plan which projects general growth of the County over the next few decades. This update included a new component with maps
which show directed growth areas. The County recognized the Kaanapali 2020 Development Plan to be within the urban growth limits identified
in these directed growth maps. Development of the Kaanapali 2020 Development Plan lands in accordance with the Kaanapali 2020 Development
Plan will require, in addition to state land use reclassification of some of the land from agriculture to urban, appropriate designation
under the County community plan, and the appropriate County zoning designation included in the Maui County General Plan noting it as an
urban growth area. In December 2021, the West Maui Community Plan ("WMCP"),which consists of a vision statement, goals, policies,
and actions to guide growth and preservation in West Maui, was updated and became part of the General Plan. The Company is evaluating
the effect, if any, the changes to the WMCP will have on its development plans. Obtaining any and all of these approvals can involve a
substantial amount of time and expense, and approvals may need to be resubmitted if there is any subsequent, material deviation in current
approved plans or significant objections by the responsible government agencies. There are no assurances that the Company can obtain approvals
or deviations.

 In connection with any
successful petition to change any of the various land use classifications (state land use district, county community plan, county
zoning) of the Kaanapali 2020 Development Plan, the Company may be required to make significant improvements in public facilities
(such as roads), to dedicate property for public use, to provide employee/workforce housing units and to make other concessions,
monetary or otherwise. The ability of the Company to perform its development activities may also be adversely affected by
restrictions that may be imposed by government agencies and the surrounding communities because of inadequate public facilities,
such as roads, water management areas and sewer facilities, and by local opposition to continued growth. The Lahaina wildfires have
caused, and may continue to cause, further delays in the Company's planned developments. However, as part of the Kaanapali
2020 Development Plan, the Company has included a number of community members and local government officials in the development
planning process and has earned significant community support for its preliminary Kaanapali 2020 Development Plan. It also believes
that it enjoys general local community support for its Puukolii Village Mauka concept. The Company hopes that carrying on with this
process will continue to generate substantial support from local government and the community for the Company's development
plans.

 There can be no assurance
that all necessary approvals will be obtained, that modifications to those plans will not require additional approvals, or that such additional
approvals will be obtained, nor can there be any assurance as to the timing of such events.

 In September 2014, KLMC, pursuant
to a property and option purchase agreement ("Purchase Agreement") with Newport Hospital Corporation ("NHC") sold
an approximately 14.9 acre parcel in West Maui. The Purchase Agreement (as subsequently amended) commits KLMC to fund up to $0.6 million,
depending on various factors, for off-site roadway, sewer and electrical improvements that will also provide service to other KLMC properties.
KLMC may, at its discretion, design, construct, install, and complete all or portions of the off-site road, sewer and/or electrical improvements,
in which case the developer shall pay to KLMC the total costs thereof, less the KLMC committed amount. In relation to such sewer line
improvement, KLMC has entered into a contract for $1.1 million to install the sewer line. KLMC has paid $1.1 million on the contract which
has been recorded as a receivable, less KLMC's sewer line commitment of $0.2 million. In accordance with the Purchase Agreement,
the receivable accrues interest of 6.5% and is secured by the 14.9 acre property. Due to the receipt of a Demand for Arbitration, discussed
below, as of December 31, 2024, the Company recorded an approximate $1 million credit loss reserve on its receivable with NHC based on
its evaluation of the probability of default that exists at NHC. The amount of the credit loss reserve represents the entire receivable
amount and interest incurred as of December 31, 2024. In conjunction with the Purchase Agreement, the Company retains certain approval
rights relating to the uses and designs of the site to ensure the uses and designs are aligned with the Company's planned master
development. If such uses result in a dispute with the developer of the site, development of the site could be delayed. The 14.9 acre
site is intended to be used for a critical access hospital, skilled nursing facility, assisted living facility, and independent living
facility.

 On August 5, 2024, NHC served
KLMC with a Demand for Arbitration administered by Dispute Prevention and Resolution, Inc. ("DPR"), relating to the Infrastructure
Improvement Agreement and NHC's development of the site. NHC alleges, among other things, that KLMC wrongfully caused significant
delays, increased costs and related damages to NHC with respect to NHC's planning and construction of the infrastructure improvements
required of NHC under the Infrastructure Improvement Agreement (as subsequently amended). NHC seeks judgment for declaratory relief that
the Infrastructure Improvement Agreement between NHC and KLMC is void; in the alternative, for reformation of the Infrastructure Improvement
Agreement; for award of damages in an amount to be proven at arbitration; for attorneys' fees and costs; for prejudgment and post-judgment
interest on any monetary award; and for such other and further relief as the arbitrator deems appropriate. On October 25, 2024, KLMC
filed an Answering Statement to NHC's Demand for Arbitration and KLMC's counterclaim against NHC. On November 5, 2024, DPR
confirmed the assignment of a mutually agreed upon arbitrator. The arbitration hearing is expected to begin in August 2025. The pre-arbitration
discovery process is ongoing. KLMC will continue to vigorously defend. However, there can be no assurance that the eventual outcome of
the arbitration will not result in any material liability or a material impact on business and financial results for KLMC.

 A relatively small portion
(approximately 300 acres) of the Kaanapali 2020 Development Planning area owned by the Company, known as Puukolii Village Mauka, comprised
of two parcels known as Puukolii Village Mauka and another parcel adjacent to Puukolii Village Mauka, received entitlements in 1993 under
the terms of a superseded law that fast tracked entitlements for planned mixed use developments that contained the requisite percentage
of affordable housing units. The requirements imposed on the Company relative to these entitlements proved uneconomic and thus the developments
were not pursued. The Company proposed revisions to certain entitlement conditions as well as the development agreement with the applicable
state agencies and is continuing to plan for the development of the Puukolii Village Mauka area, which will, if ultimately developed,
include certain affordable and market housing units, a small commercial area, a school, a park and associated improvements. From 2007
through 2009, the Company received various approvals of its proposed revisions of entitlement conditions and of the development agreement
including the addition of the County housing department as a party to the development agreement.

 On June 3, 2024, KLMC entered
into a property sale agreement ("PVM Sales Agreement") with an unrelated third party for the sale of several parcels of land,
aggregating approximately 241 acres (the "PVM land parcels") within Pu'ukoli'i Village Mauka located near the
Kaanapali resort area, north of Lahaina, Hawaii. The closing of the sale of the PVM land parcels was subject to the satisfactory completion
of the developer's investigation and evaluation of the PVM land parcels during a specified due diligence period. Prior to the expiration
of the due diligence period on November 15, 2024, the developer had not delivered a notice to proceed, and therefore, the PVM Sales Agreement
terminated pursuant to its terms on November 15, 2024.

 Due to the termination of the PVM Sales Agreement, the Company is continuing
with its planning for the development of a 241-acre residential development site in the region south of Kaanapali Coffee Farms known as
Puukolii Village. The conceptual master plan is comprised of 20 developable parcels planned for 940 units including a mix of affordable
and market priced homes, both single and multi-family, mixed use commercial, parks, school, and community facilities. Puukolii Village
is fully entitled. Critical to the Company's ability to develop Puukolii Village is the Company's ability to secure water
use permits from the State of Hawaii Commission on Water Resource Management (CWRM). The purveyor for potable water for the Kaanapali
service area, which would supply water to Puukolii Village, is in the process of preparing an application to CWRM for a permit to secure
the water needed to service the development. The Company is providing necessary information to support the application. The Company cannot
provide any assurance that CWRM will approve such permit application for the amount of water needed or CWRM could impose conditions on
such use that might affect the feasibility of the development. See below for further discussion of CWRM. In conjunction with the potential
development of Puukolii Village and in coordination with the possible development by an unrelated third party of the 14.9 acre site to
be used for a critical access hospital, as noted above, the Company entered into a contract to install a sewer line from the Puukolii
Village site to the critical care hospital site. The developer of the critical access hospital site is obligated to reimburse KLMC for
the cost of the portion of the sewer line fronting the critical care hospital site less KLMC's obligated share of the cost. (See
discussion above).

 The Company is in the planning stages for the development of a 295-acre
parcel in the region mauka of the Kaanapali Coffee Farms ("KCF Mauka"). The parcel is to be comprised of 61 agricultural lots
that will be offered to individual buyers. The Company expects to develop the parcel in phases and all phases have been submitted to the
County for subdivision approval. The Company continues to work with the County to resolve certain of the County's comments relating
to the subdivision. The Company's understanding is that all outstanding comments from the County have been resolved verbally with
County staff. The final approval letter has been pending and additional efforts are being made to secure the approval. Upon final subdivision
approval of all phases and receipt of final plat of the first phase from the County, which requires a bond in the amount of the cost to
develop the first phase, the Company can pre-sell the undeveloped lots in the first phase. The Company expects to market the lots in the
first phase upon receiving final approvals from the County, subject to various contingencies, including, but not limited to, governmental
and market factors and the availability of a bond to secure the first phase of the development. Also critical to the Company's ability
to develop KCF Mauka is the Company's ability to secure water use permits from the State of Hawaii Commission on Water Resource
Management (CWRM). The purveyor for potable water for the Kaanapali service area, which would supply water to KCF Mauka, is in the process
of preparing an application to CWRM for a permit to secure the water needed to service the development. The Company is providing necessary
information to support the application. The Company cannot provide any assurance that CWRM will approve such permit application for the
amount of water needed or CWRM could impose conditions on such use that might affect the feasibility of the development. See below for
further discussion of CWRM. Therefore, there can be no assurance the Company will be able to meet such timetable, that the subdivision
will ultimately be approved or that the lots will sell for prices deemed advantageous by the Company.

 KLMC is a party to an agreement
with the State of Hawaii for the development of the Lahaina Bypass Highway. Approximately 2.4 miles of this two lane state highway have
been completed. Construction to extend the southern terminus was completed mid-2018. The northern portion of the Bypass Highway, which
extends to KLMC's lands, is in the early stage of planning. Under certain circumstances, which have not yet occurred, KLMC remains
committed for approximately $1.1 million of various future costs relating to the planning and design of the uncompleted portion of the
Bypass Highway. Under certain conditions, which have not yet been met, KLMC has agreed to contribute an amount not exceeding $6.7 million
toward construction costs. Any such amount contributed would be reduced by the value of KLMC's land actually contributed to the
State for the Bypass Highway.

 These potential commitments have
not been reflected in the accompanying consolidated financial statements. While the completion of the Bypass Highway would add value to
KLMC's lands north of the town of Lahaina, there can be no assurance that it will be completed or when any future phases will be
undertaken.

 Current
Operations. Agricultural operations consist primarily of cultivation, milling and sale of coffee. The coffee farming operation
includes manpower and equipment required to fertilize, prune and maintain the coffee plantations as well as equipment required to
harvest and haul coffee cherry to the Company's former processing plant (the "Mill") located on the former sugar
mill site in Lahaina, Hawaii. As discussed above, the coffee mill was destroyed in the Lahaina wildfire. The Company is in the
planning and design stages of building a new mill at its farm in Kaanapali, which is not expected to be completed in time for the
next coffee harvest. The coffee fields were not destroyed in the fire. The Company also maintains and operates a system of
irrigation infrastructure including development tunnels, ditches, tunnels, siphons, flumes and reservoirs required to irrigate the
Company's agricultural operations and future planned developments with non-potable water.

 The Company sells milled
green coffee under the brand name Mauigrown Coffee mainly to interisland Hawaii customers, generally roasters who have retail coffee shops,
and also sell to grocery stores and online. Based on availability, green coffee is also shipped and sold to mainland and international
customers, including roasters, dealers, and traders. Portions of the coffee farms are operated as part of the 336-acre Kaanapali Coffee
Farms agricultural subdivision, in which a portion of each lot owned by the lot owner is used for their single-family dwelling, while
the remainder of the lot containing coffee trees is farmed by the Company. The Company has entered into certain agreements with the Kaanapali
Coffee Farms Lot Owners Association in this regard. The planned 295-acre, second phase of KCF Mauka will be within the coffee farming
area as well. The Company continues to plant additional acreage of coffee on its agricultural land not currently included in the developable
lands of Kaanapali 2020 Development Plan.

 Coffee production and yields
are subject to many factors, particularity weather related factors, including rainfall and the availability of sufficient irrigation water
flowing through its irrigation system. Yields may be reduced in years of drought when irrigation water and rainfall is insufficient. Reference
is made to Item 1A. Risk Factors for risks relating to agriculture. The Company purchases crop insurance annually which reduces certain
coffee crop production risks. The Company received crop insurance proceeds in 2023 related to losses sustained to the 2022 coffee crop
due to an insured event. Additionally, acreage under production is reduced annually by required tree pruning of approximately one quarter
to one third of total coffee acreage in production.

 The coffee is sold as Maui
origin "specialty coffee" (as defined by the Specialty Coffee Association) as is most coffee produced in Hawaii. Hawaiian
coffees generally command a higher price per pound green than many other specialty coffees produced around the world but there can be
no assurance such prices will continue or that coffee prices or yields will be sufficient to cover all costs of production and sales.

 In addition to the Company's
commercial coffee farming operations, the Company grows bananas and citrus. The Company also has approximately 660 acres of fenced pasture
for cattle grazing as well as approximately 40 acres of fenced pasture for goat grazing. The Company's banana operation currently
consists of approximately 14 acres. The bananas are sold by the Company to certain customers for distribution on Maui. KLMC also grows
and sells a small amount of various citrus including grapefruit and lemons. These are sold to various local venders to be sold at farmer's
markets on Maui. Although the Company realizes minor amounts of revenue relating to these agricultural operations there are certain property
tax advantages with land engaged in active agriculture.

 For a description of financial
information by segment, please read Note 7 to the attached consolidated financial statements included in Item 8, which information is
incorporated herein by reference.

 Employees

 At March 1, 2025,
Kaanapali Land and its subsidiaries employed a total of 24 employees. Certain corporate services are provided by Pacific Trail
Holdings, LLC ("Pacific Trail") and its affiliates. Pacific Trail owns approximately 76% of the Common
Shares of Kaanapali Land. Kaanapali Land reimburses Pacific Trail and its affiliates for these services and related overhead at
cost.

 Trademarks and Service
Marks

 The Company maintains a variety
of trademarks and service marks that support each of its business segments. These marks are filed in various jurisdictions, including
the United States Patent and Trademark Office, the State of Hawaii Department of Commerce and Consumer Affairs and foreign trademark offices.
The trademarks and service marks protect, among other things, the use of the term "Kaanapali" and related names in connection
with the developments in the vicinity of the Kaanapali Resort area on Maui and the various trade names and service marks obtained in connection
with the Company's coffee operations. Certain trademarks, trade names and service marks have also been registered in connection with the
Kaanapali Coffee Farms development. Also protected are certain designs and logos associated with the names protected. Certain marks owned
by the Company have been licensed to third parties, however, the income there from is not material to the Company's financial results.
To the extent deemed advantageous in connection with the Company's ongoing businesses, to satisfy contractual commitments with respect
to certain marks or where the Company believes that there are future licensing opportunities with respect to specific marks, the Company
intends to maintain such marks to the extent necessary to protect their use relative thereto. The Company also intends to develop and
protect appropriate marks in connection with its future land development and agricultural activities.

 Market Conditions and
Competition

 There are a number of factors
that historically have negatively impacted Kaanapali Land's property activities, including market conditions, the difficulty in obtaining
regulatory approvals, the high cost of required infrastructure and the Company's ability to maintain operating surplus in its other business
segment. In addition, the Lahaina wildfire could eventually cause a weakening of the west Maui real estate market, which could negatively
impact the Company. As a result, the planned use of many of the Company's land holdings and the ability to generate cash flow from these
land holdings have become long-term in nature, and the Company has found it necessary to sell certain parcels in order to raise cash rather
than realize their full economic potential through the entitlement process.

 There are several developers,
operators, real estate companies and other owners of real estate that compete with the Company in its property business on Maui, many
of which have greater resources. The number of competitive properties in a particular market could have a material adverse effect on the
Company's success. In addition, many properties previously purchased from the Company by retail buyers are listed for resale and could
provide additional competition to the Company in future years.

 Government Regulations
and Approvals

 The current regulatory approval
process for a project can take many years and involves substantial expense. There is no assurance that all necessary approvals and permits
will be obtained with respect to the Company's current and future projects. Generally, entitlements are extremely difficult to obtain
in Hawaii. Many different agencies at the state and County level are involved in the entitlement process. There is often significant opposition
from numerous local groups - including environmental organizations, various community and civic groups, condominium associations and politicians
advocating no-growth policies, among others. Certain ordinances adopted by the County of Maui have placed additional requirements on developers,
some of which may be difficult or expensive to satisfy. Other proposed ordinances that have not yet passed may place moratoria on new
development. It is currently unknown to what extent new legislative initiatives will impact the cost or timing of the Company's planned
developments.

 By letters dated October 28, 2022,
the State of Hawaii Commission on Water Resource Management ("CWRM") officially designated all six Aquifer System Areas of
the Lahaina Aquifer Sector, Maui, as Ground Water Management Areas, as of August 6, 2022. CWRM notified the Company that by August 5,
2023, the Company would need to apply for ground and surface water use permits to continue the Company's use of certain wells that are
integral to the Company's entire operations. The permits, when or if granted
and subject to various conditions, would preserve the Company's existing water uses as of August 6, 2022. The Company has submitted such
applications for permits. The Company cannot provide any assurances that CWRM will approve such permit applications for the amounts of
water the Company seeks or impose conditions on such use that might affect the Company's operations. If CWRM should fail to approve
the Company's water requests or impose onerous conditions on its use, CWRM's actions could delay the Company's development
in substantial and material respects and affect the Company's operations and finances. Further,
i n the event permits adequate to the Company's plans are not received timely or at all, there could be negative impacts on the
west Maui real estate market as a whole and the development and sale of the Company's lands on the Island of Maui, thereby materially
and adversely affecting the Company's operations, land sales, land values, results, and financial position.

 Kaanapali Land continues to work
toward the necessary entitlements for the Kaanapali 2020 Development Plan. While some of these lands have some form of entitlements,
it is anticipated that at least a substantial portion of the land will require state district boundary amendments and Community Plan
amendments, as well as rezoning approvals. In January 2009 the Company received approval of revisions to its development plans for the
Puukolii Village Mauka parcels. The Kaanapali 2020 Development Plan is recognized within the urban growth areas identified in the growth
maps of the Maui County General Plan. Approximately 1,500 acres of the Company's Maui land which is contiguous to Kaanapali 2020 Development
Plan land is located toward the top of mountain ridges and in gulches is classified as conservation, which precludes most other use.
This conservation land, and other land that will be designated as open space, is an important component of the overall project, allowing
for the protection of water and other natural resources, and its existence is expected to influence obtaining the entitlements for the
remaining land.

 Environmental Matters

 The Company is subject to environmental
and health safety laws and regulations related to the ownership, operation, development and acquisition of real estate, the destruction
that occurred at the Pioneer Mill Site as a result of the Lahaina wildfire, or the operation of former business units. Under those laws
and regulations, the Company may be liable for, among other things, the costs of removal or remediation of certain hazardous substances.
In addition, the Company may find itself having to defend against personal injury lawsuits based on exposure to substances including asbestos
related liabilities. Regarding asbestos related liabilities, Kaanapali Land, as successor to other entities and D/C Distribution Corporation
("D/C") have been named as defendants in personal injury actions allegedly based on exposure to asbestos. Those laws and regulations
often impose liability without regard to fault. With regard to other environmental matters as generally described in the risk factors
set forth below, no assurance can be given that those matters will not have a material adverse effect on the Company's consolidated
financial position or results of operations. Reference is made to Item 1A. Risk Factors and Note 6 of the consolidated financial
statements included in Item 8 for a description of certain legal proceedings related to environmental conditions.

 Item 1A. Risk Factors

 The Company faces
numerous risks and uncertainties, including those set forth below. The risks described below are not the only risks that the Company
faces. New risk may emerge from time to time and it is not possible to predict all such risks. These risk factors include a number
of risks and uncertainties that could negatively impact Kaanapali Land's property activities and operations. If any of the risks
described below or any potential new risks not yet identified occur, they may have a material adverse effect on the Company's
business, consolidated financial position or results of operations.

 Reference is made to
Item 1. Business and Item 3. Legal Proceedings for further discussion of some of the risks and uncertainties factors facing
Kaanapali Land.

 Risks Related to Hawaiian Real Estate and
Development Markets

 The Kaanapali 2020 Development
Plan (including, without limitation, Kaanapali Coffee Farms and Puukolii Village Mauka), as well as the Company's other development activities,
are, apart from the risks associated with the entitlement process described above, subject to the risks generally incident to the ownership
and development of real property. These include the possibility that cash generated from sales will not be sufficient to meet the Company's
continuing obligations. This could result from inadequate pricing or declines on asset values or pace of sales of properties or disruptions
and delays in the supply of construction material or changes in costs of construction or development; increased and continuing government
mandates; adverse changes in Hawaiian economic conditions, such as increased costs resulting from high rates of inflation, and availability
of labor, increased costs of marketing and production, restricted availability of financing; adverse changes in local, national and/or
international economic conditions (including adverse changes in exchange rates of foreign currencies for U.S. dollars); adverse effects
of international political events, such as geopolitical events in Europe, the Middle East, Asia, and Russia's invasion of Ukraine,
additional terrorist activity in the U.S. or abroad that lessen travel, tourism and investment in Hawaii; substantial increase in cost
of travel to Hawaii due to the increase in fuel costs or other events in the airline industry that could lessen travel and tourism in
Hawaii; the spread of contagious viruses or diseases, that could negatively impact commerce generally and travel to Hawaii; the need for
unanticipated improvements or unanticipated expenditures in connection with environmental matters; increase in real estate tax rates and
other expenses; delays in obtaining permits or approvals for construction or development and adverse changes in laws, governmental rules
and fiscal policies; acts of God, including wildfires, earthquakes, volcanic eruptions, floods, droughts, fires, tsunamis, unusually heavy
or prolonged rains, and hurricanes; and other factors which are beyond the control of the Company. Because of these risks and others,
real estate ownership and development is subject to unexpected increases in costs.

 During 2012, the County updated
its General Plan which projects general growth of the County over the next few decades. This update included a new component with maps
which show directed growth areas. The County recognized the Kaanapali 2020 Development Plan to be within the urban growth limits identified
in these directed growth maps. Development of the Kaanapali 2020 lands in accordance with the Kaanapali 2020 Development Plan will require,
in addition to state land use reclassification of some of the land from agriculture to urban, appropriate designation under the County
community plan, and the appropriate County zoning designation included in the Maui County General Plan noting it as an urban growth area.
In December 2021, the WMCP was updated and became part of the General Plan. The Company is evaluating the effect, if any, the changes
to the WMCP will have on its development plans. Obtaining any and all of these approvals can involve a substantial amount of time and
expense, and approvals may need to be resubmitted if there is any subsequent, material deviation in current approved plans or significant
objections by the responsible government agencies. There are no assurances that the Company can obtain approvals or deviations.

 By letters dated October 28, 2022,
CWRM officially designated all six Aquifer System Areas of the Lahaina Aquifer Sector, Maui, as Ground Water Management Areas, as of August
6, 2022. CWRM notified the Company that by August 5, 2023, the Company would need to apply for ground and surface water use permits to
continue the Company's use of certain wells that are integral to the Company's entire operations. The Company has submitted such applications
for permits. The permits, when or if granted and subject to various conditions, would preserve the Company's existing water uses as of
August 6, 2022. The Company cannot provide any assurances that CWRM will approve such permit applications for the amounts of water the
Company seeks or impose conditions on such use that might affect the Company's operations. If CWRM should fail to approve the Company's
water requests or impose onerous conditions on its use, CWRM's actions could delay the Company's development in substantial
and material respects and affect the Company's operations and finances. Further, i n the event

 permits adequate to the Company's plans are not received timely or at all, there could be negative impacts on the west Maui real estate
market as a whole and the development and sale of the Company's lands on the Island of Maui, thereby materially and adversely affecting
the Company's operations, land sales, land values, results, and financial position.

 The Company may, from time
to time and to the extent economically advantageous, sell rezoned, undeveloped or partially developed parcels, such as portions of the
Kaanapali 2020 Development Plan lands and/or the former Pioneer Mill site. The Company currently intends to develop the balance of its
lands for residential, resort, affordable housing, limited commercial and recreational purposes. There can be no assurances that the Company
will be successful in such efforts.

 Additional increases in interest
rates or downturn in the international, national or Hawaiian economy could affect the value of Company's properties and its profitability
and sales. A downturn of the economy could have a profound negative effect on the Hawaiian real estate market. However, the Kaanapali
resort area has historically enjoyed a significant mainland tourist market in the United States and Canada. A weakening of the Maui real
estate market has in the past negatively impacted, and would in the future negatively impact the Company.

 The Company's real estate
activities may be adversely affected by possible changes in the tax laws, including changes which may have an adverse effect on resort
and residential real estate development. High rates of inflation adversely affect real estate development generally because of their impact
on interest rates. High interest rates not only increase the cost of borrowed funds to the Company, but also have a significant effect
on the affordability of permanent mortgage financing to prospective purchasers. However, high rates of inflation may permit the Company
to increase the prices that it charges in connection with land sales, subject to a slowdown in sales and increase in home construction
costs and to general economic conditions affecting the real estate industry and local market factors. There can be no assurance that Hawaiian
real estate values will rise, or that, if such values do rise, the Company's properties will benefit.

 Risks Relating to Natural Events

 The Company's development lands
are located in an area that is susceptible to hurricanes and seismic activity. In addition, during certain times of year, heavy rainfall
is not uncommon. These events may adversely impact the Company's development activities and infrastructure assets, such as roadways, reservoirs,
water courses and drainage ways. Significant events may cause the Company to incur substantial expenditures for investigation and restoration
of damaged structures and facilities. Climate change, flooding, drought, fires, wind, prolonged heavy rains, and other natural perils
can adversely impact agricultural production and water transmission and storage resources on lands owned or used by the Company.

 Beginning on August 8, 2023, a wildfire occurred due
east of historic Lahaina town in Maui. The fire spread rapidly due to extreme wind conditions caused in part by Hurricane Dora which traveled
800 miles offshore west of Maui. The fires caused multiple fatalities, widespread damage to Lahaina town and the surrounding area including
the Company's 19-acre Pioneer Mill Site. The Company's offices and coffee mill were located on the site as well as various
other structures and a building which was leased to an unrelated third party and used to operate a coffee store. The Company also utilized
portions of the property for short term license agreements with third parties that generated income for the Company. Although no employees
were injured in the fire, the Company's offices and coffee store building were destroyed. Additionally, most of the personal property
of the licensees and the coffee mill was destroyed. The widespread destruction has caused disruptions in the Company's development
plans. The damage to the coffee mill has disrupted operations and prevented the Company from processing and selling the 2023 and 2024
year coffee crop. It is also likely that the fires and devastation caused thereby will adversely affect the long-term Maui economy and
businesses operated on Maui. Maui hotel occupancy and average daily rates have declined during 2024 as the Lahaina wildfire continues
to disrupt tourism. Maui's recovery from the wildfire remains slow. Clean up of Lahaina has been substantially completed by U.S.
Army Corps of Engineers ("USACE") contractors. The property is currently leased by a USACE contractor and was used as a base
yard for the clean-up of Lahaina. The lease term expires July 2025 with an option to extend for six months. During 2023, the Company initiated
claims with its insurance carriers and in October 2023, the Company received an initial, unallocated advance payment of $1 million, in
June 2024, the Company received approximately $4.9 million and in August 2024 received approximately $1.1 million from its insurance carrier.
Although the Company currently expects that the Company's insurance coverage will compensate the Company for the majority of its
losses incurred in connection with the fire and related devastation, including the costs of its structures and equipment lost in the fire,
the loss in revenue from the lack of coffee sales, and the loss of income from the licensees, there can be no assurances the Company will
be fully compensated for such losses. The Company could experience losses in excess of its insured limits, and further claims for certain
losses could be denied or subject to deductibles or exclusions under its insurance policies. The Company has relocated its offices to
temporary office facilities located on its lands in Kaanapali and is in the planning and designing stages of relocating its coffee mill
to its farm in Kaanapali.

 In addition, similar events elsewhere
in Hawaii may cause regulatory responses that impact all landowners. For example, as described in Note 6 to the consolidated financial
statements included in Item 8, the Company received notice from the Hawaii Department of Land and Natural Resources ("DLNR")
that DLNR on a periodic basis would inspect all significant dams and reservoirs in Hawaii, including those maintained by the Company on
Maui in connection with its agricultural operations. A series of such inspections have taken place over the period from 2006 through the
most recent inspections that occurred in July 2024. To date, the DLNR has cited certain deficiencies concerning two of the Company's
reservoirs relating to dam and reservoir safety standards established by the State of Hawaii. These deficiencies include, among other
things, vegetative overgrowth, erosion of slopes, uncertainty of inflow control, spillway capacity, and freeboard, and uncertainty of
structural stability under certain loading and seismic conditions. The Company does not expect that additional deficiencies will be cited
as a result of the most recent inspection. The Company has taken certain corrective actions, including lowering the reservoir operating
level; as well as updating plans to address emergency events and basic operations and maintenance. Remediation of all cited deficiencies
could result in significant and costly improvements which may be material to the Company.

 The DLNR categorizes the
reservoirs as "high hazard" under State of Hawaii Administrative Rules and State Statutes concerning dam and reservoir safety.
This classification, which bears upon government oversight and reporting requirements, may materially increase the cost of managing and
maintaining these reservoirs.

 Risks Relating to Agriculture

 The Company remains engaged
in farming, harvesting, and milling operations relating to coffee orchards. The Company incurs significant risks relating to the cost
of growing and maintaining the coffee trees and producing and selling the coffee. As discussed above, the coffee mill was destroyed in
the Lahaina wildfire. The Company is in planning and design stages of building a new mill at its farm in Kaanapali, which is not expected
to be completed in time for the next coffee harvest. The coffee fields were not damaged in the fire. The Company is experiencing rising
costs in its farming operations as a result of local labor shortages and the recent rise in inflation. Such cost increases may negatively
impact the Company's results of operations in the future and may cause disruptions in the Company's development plans. The
Company also incurs the risk that coffee farming could be materially affected because of the adverse effects on coffee yields caused by
coffee berry borer ("CBB"), coffee leaf rust ("CLR") or through regulatory risk, as described below. The Company
relies on water sourced from its irrigation systems, which divert water from streams and development tunnels into a network of ditches,
tunnels, flumes, siphons and reservoirs. In the event CWRM or any other regulatory body limits the Company's ability to divert stream
waters to its irrigation systems, the result could have a negative impact on the Company's ability to continue with its agricultural
operations and development plans.

 Several years ago, CBB, a
beetle native to Central Africa and that has existed for some time in Central and South America, was discovered on the islands of Hawaii
and Oahu. In 2017 the CBB appeared on the island of Maui. Effective May 1, 2017, the Hawaii Department of Agriculture ("HDOA")
began restricting the shipping of coffee grown on Maui to other Hawaiian Islands due to the discovery of the CBB on the island. The restriction
requires specific treatment and inspection by HDOA Plant Quarantine inspectors before shipping to other islands.

 In September 2020, the Company
discovered the CBB on its land. The Company has been aware of the possible spread to its crops and has maintained sound management practices.
The Company has developed an integrated management program designed to manage all aspects for cultural control of the CBB. Such program
has resulted in an increase in the costs of farming the coffee and the CBB may lower the quantity and quality of salable coffee.

 The overall effect of the
CBB is to reduce the yield and quality of the coffee bean. Farming methods have been developed to reduce the effect on the islands of
Hawaii and Oahu, and the Company has incorporated many of these practices into its integrated management program. While the Company intends
to continue to utilize the best practices available, there can be no assurance that the action by the HDOA or the spread of the CBB to
its crops will not have a material effect on its coffee operations.

 In October 2020, agriculture
officials with HDOA confirmed the presence of CLR on Maui. HDOA also confirmed the presence of CLR on the island of Hawaii in November
2020. The Company found evidence of CLR on its farm in January 2021, which was subsequently confirmed by HDOA. CLR is one of the most
devastating diseases of coffee plants. It is established in all of the other major coffee-growing areas of the world but had not previously
been found in Hawaii. The HDOA has since discovered CLR in all of the coffee-growing regions of Hawaii.

 CLR can cause severe defoliation.
Infected leaves drop prematurely, greatly reducing the plant's photosynthetic capacity and reducing berry growth. Long-term effects
of CLR can have a stronger impact by causing dieback, which reduces the number of productive nodes on branches, significantly impacting
the following year's yield.

 The Company has implemented
an integrated past management program designed to manage all aspects for cultural control of CLR. As with the CBB, such program may result
in an increase in the costs of farming the coffee and lower the quantity and quality of salable coffee, and there can be no assurance
that CLR will not have a material adverse effect on the Company's coffee operations.

 Risks Relating to Hawaiian, U.S. and World
Economies Generally

 The Company's businesses
will be subject to risks generally confronting the Hawaiian, U.S. and world economies. All of the Company's tangible property is located
in Hawaii. As a result, the Company's revenues will be exposed to the risks of investment in Hawaii and to the economic conditions prevalent
in the Hawaiian real estate market. While the Hawaiian real estate market is subject to economic cycles that impact tourism and investment
(particularly in the United States, Japan and other Pacific Rim countries), it is also influenced by the level of economic development
in Hawaii generally and by external and internal political forces.

 Adverse macroeconomic conditions
continue to cause economic uncertainty and market volatility. High levels of inflation, slower growth or recession, changes to fiscal
and monetary policy, higher interest rates, currency fluctuations, challenges in the supply chain, implementation of tariffs, and other
adverse macroeconomic conditions, may continue. Such uncertainty and risk may negatively impact the Company's performance and financial
results, including any potential negative impact on the values of its property holdings on Maui and future planned development and sales
of parcels of such development, changes in law and/or regulation, and uncertainty regarding government and regulatory policy.

 Various factors impact the
desire of people to travel, particularly by air. Discretionary income and unemployment throughout the world also impact travel to Hawaii
and the market for real estate. Thus, Hawaii is subject to higher risks than other portions of the United States due to its disproportionate
reliance on air travel and tourism. The visitor industry is Hawaii's most important source of economic activity, accounting for a significant
portion of Gross State Product. For example, the outbreak of the COVID-19 coronavirus materially impacted and limited the travel and tourism
industry and a similar event could again trigger a prolonged adverse effect on such economic activity.

 Because of the foregoing
considerations, the risks associated with the large reliance by Hawaii on a visitor base, both from foreign countries and the United States
mainland, will disproportionately impact the Company in future years, as market and visitation cycles play out.

 Environmental Risks and Environmental Regulations

 The Company is subject to environmental
and health safety laws and regulations related to the ownership, operation, development and acquisition of real estate, or the operation
of former business units. Under various federal, state and local laws, ordinances and regulations, a current or previous owner, developer
or operator of real estate may be liable for the costs of removal or remediation of certain hazardous toxic substances at, on, under or
in its property. The costs of such removal or remediation of such substances could be substantial. Such laws often impose liability without
regard to whether the owner or operator knew of, or was responsible for, the actual release or presence of such hazardous or toxic substances.
The presence of such substances may adversely affect the owner's ability to sell or rent such real estate or to borrow using such real
estate as collateral. Persons who arrange for the disposal or treatment of hazardous or toxic substances also may be liable for the costs
of removal or remediation of such substances at the disposal or treatment facility, whether or not such facility is owned or operated
by such person. Certain environmental laws impose liability for the release of asbestos containing material into the air, pursuant to
which third parties may seek recovery from owners or operators of real properties for personal injuries associated with such materials,
and prescribe specific methods for the removal and disposal of such materials. The cost of legal counsel and consultants to investigate
and defend against these claims is often high and can significantly impact the Company's operating results, even if no liability is ultimately
shown. No assurance can be given that the Company will not incur liability in the future for known or unknown conditions and any significant
claims may have a material adverse impact on the Company.

 Kaanapali Land, as successor by
merger to other entities, and D/C have been named as defendants in personal injury actions allegedly based on exposure to asbestos. While
there are relatively few cases that name Kaanapali Land, there were a substantial number of cases that were pending against D/C on the
U.S. mainland (primarily in California). Cases against Kaanapali Land (hereafter, "Kaanapali Land asbestos cases") are allegedly
based on its prior business operations in Hawaii and cases against D/C were allegedly based on sale of asbestos-containing products by
D/C's prior distribution business operations primarily in California. Certain asbestos-related proofs of claims in the bankruptcy case
had been withdrawn in connection with closing the bankruptcy. Certain of these cases have been refiled subsequent to the closing of the
bankruptcy. Each entity defending these cases believes that it has meritorious defenses against these actions, but can give no assurances
as to the ultimate outcome of these cases. The defense of these cases had a material adverse effect on the financial condition of D/C
as it was forced to file a voluntary petition for liquidation. Such bankruptcy case was closed on June 14, 2023. Kaanapali Land does
not presently believe that future cases in which it may be named will result in any material liability to Kaanapali Land; however, there
can be no assurance in that regard. Reference is made to Note 7 to the Company's consolidated financial statements included in Item
8 for additional discussion.

 Risks Relating to the Company's Shares

 The Company's shares are
not listed on a major exchange in the United States and are instead traded via the over-the-counter broker-dealer network. Therefore,
there may be additional steps and fees when trading the Company's shares. The Company's shares have less liquidity, low trading
volume, price volatility, and may experience larger spreads between bid price and ask price.

 Item 1B. Unresolved Staff Comments

 Not applicable.

 Item 1C. Cybersecurity

 The Company utilizes an affiliated
company of Pacific Trail ("IT Provider"), which is a provider of financial services to numerous affiliates of Pacific Trail,
which operate in the real estate and financial services industries for its accounting, accounts payable, treasury and related Information
Technology ("IT") and data processing functions. The Company's financial systems and related controls, procedures, risk
management, and including IT systems is integrated with that of the affiliated companies (together the "Affiliated Group").

 Cybersecurity and cybersecurity
risk management are important aspects of operations and a focus area for the Affiliated Group. Cybersecurity risks are evaluated on an
ongoing basis by the Affiliated Group and its IT Provider, both internally and with the assistance of external firms.

 The Company engages a national
technology firm in an effort to maintain and continually update its cybersecurity posture and keep current with evolving cybersecurity
risks. The IT Provider's cybersecurity program is examined on a regular basis, and new procedures and tools are adopted on an ongoing
basis to address the changing cybersecurity landscape. The IT Provider's technology team tests the effectiveness of its tools with
periodic exercises, including Penetration (PEN) tests. Risk is assessed to identify and manage risks that could affect its ability to
provide reliable processing to the Affiliated Group. This process requires IT Provider to identify significant risks based upon the following:
(a) management's internal knowledge of and perceived risks to the IT environment, (b) significant changes to the internal
and the third-party vendor IT environments, (c) input received annually from its consultants and external auditors based on its auditor's
review of the IT operating environment, (d) management's review of Service Organization Controls (SOC) reports received from
vendors housing critical applications, (e) regulatory requirements or operating standards that may directly impact the IT environment,
and (f) identification of threats and the evaluation of the probability and likelihood of threats. For any significant risks identified,
IT Provider's management is responsible for implementing appropriate measures to monitor and manage these risks, including implementing
or revising control procedures, conducting specific consulting projects, and updating systems and processes to ensure compliance.

 As many security threats
involve email and social engineering, the IT Provider has a multifaceted security training program for Affiliated Group employees. Cybersecurity
training classes are administered at least annually. Testing and assessment of employees' ability to thwart attacks are performed
throughout the year, with training being targeted at areas of users' weakness.

 The Company does not believe
that any risks from cybersecurity threats to date, including as a result of any previous cybersecurity incidents of which the Company
is aware, have materially affected or are reasonably likely to materially affect the Company, including its business strategy, results
of operations, or financial conditions, however, there can be no assurance in that regard.

 The management of IT Provider
is responsible for directing and controlling operations and for establishing, communicating, and monitoring policies and procedures. The
key members of management are the President, (who has over 20 years' experience in his current position) and is responsible for
overseeing delivery of the services, and the Chief Information Officer ("CIO") (who has over 10 years' experience in
his current position) and is responsible for overseeing the IT environment that supports the services. Importance is placed on maintaining
sound internal controls and promoting integrity and the ethical values of the Affiliated Group in all personnel. Organizational values
and behavioral standards are communicated to all personnel through policy statements and the Employee Handbook. Additionally, the President
and CIO are in daily contact with personnel at all levels and reinforce the Affiliated Group's policies, procedures, and organizational
values.

 The IT Provider reports to
the President and upper level management of the Affiliated Group as part of the risk management process in which IT Provider management
identifies significant risks through discussions with Affiliated Group management and develops responses and mitigating actions to address
such risks.

 Item 2. Properties

 Land Holdings

 The major real
properties owned by the Company are described under Item 1. Business. The Company believes that its real properties are
adequate and suitable for its business as presently conducted.

 Item 3. Legal Proceedings

 The information set forth
under the "Commitments and Contingencies" section in Note 6 to the consolidated financial statements, included in Part II,
Item 8 of this report, is incorporated herein by reference.

 Item 4. Mine Safety Disclosures

 None.

 Item 5. Market for Registrant's
Common Equity, Related Stockholder Matters and
Issuer Purchases of Equity Securities

 As of March 1, 2025, there
were approximately 611 holders of record of the Company's 1,792,613 Common Shares and 52,000 Class C Shares. "Shares" mean
shares of the Company which represents membership interests in the Company. The Company has no outstanding options, warrants to purchase
or securities convertible into, common equity of the Company. There is no established public trading market for the Company's shares.
The Company has elected to be treated as a corporation for federal and state income tax purposes. As a consequence, under current law,
holders of shares in the Company will not receive direct allocations of profits or losses relating to the financial results of the Company
as they would for the typical limited liability company that elects to be treated as a partnership for tax purposes. In addition, any
distributions that may be made by the Company will be treated as dividends. However, no dividends were paid by the Company in 2024 and
the Company does not anticipate making any distributions for the foreseeable future.

 Item 6. [Reserved]

 Item 7. Management's Discussion
and Analysis of Financial Condition and Results of
Operations

 All references to "Notes"
herein are to Notes to Consolidated Financial Statements contained in this report. Information is not presented on a reportable segment
basis in this section because in the Company's judgment such discussion is not material to an understanding of the Company's business.

 In addition to historical information, this Report contains forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current
expectations about its businesses and the markets in which the Company operates. These statements include expectations concerning, among
other things, the expected outcome of legal proceedings, the anticipated resolution of permit applications and regulatory comments, the
Company's liquidity and operations, and the Company's land development plans, goals and initiatives. Such forward-looking
statements are not guarantees of future performance and involve known and unknown risks, uncertainties or other factors which may cause
actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements
expressed or implied by such forward-looking statements. Actual operating results may be affected by various factors including, without
limitation, natural events, including the Lahaina wildfire discussed below, the effect of geopolitical, economic and market conditions
in Hawaii and globally, including increases in the rate of inflation, changes to fiscal and monetary policy, heightened interest rates
and currency fluctuations, pressure on the global banking system, competitive market conditions, uncertainties and costs related to the
imposition of conditions on receipt of governmental approvals and costs of material and labor, and actual versus projected timing of events
all of which may cause such actual results to differ materially from what is expressed or forecast in this report.

 Lahaina Wildfire

 Beginning on August 8, 2023, a wildfire occurred due east of historic Lahaina
town in Maui. The fire spread rapidly due to extreme wind conditions caused in part by Hurricane Dora which traveled 800 miles offshore
west of Maui. The fires caused multiple fatalities, widespread damage to Lahaina town and the surrounding area including the Company's
19-acre Pioneer Mill Site. The Company's offices and coffee mill were located on the site as well as various other structures and
a building which was leased to an unrelated third party and used to operate a coffee store. The Company also utilized portions of the
property for short term license agreements with third parties that generated income for the Company. Although no employees were injured
in the fire, the Company's offices and coffee store building were destroyed. Additionally, most of the personal property of the
licensees and the coffee mill was destroyed. The widespread destruction has caused disruptions in the Company's development plans.
The damage to the coffee mill has disrupted operations and prevented the Company from processing and selling the 2023 and 2024 coffee
crop. It is also likely that the fires and devastation caused thereby will adversely affect the long-term Maui economy and businesses
operated on Maui. Maui hotel occupancy and average daily rates have declined during 2024 as the Lahaina wildfire continues to disrupt
tourism. Maui's recovery from the wildfire remains slow. Clean up of Lahaina has been substantially completed by USACE contractors.
The property is currently leased by a USACE contractor and was used as a base yard for the clean-up of Lahaina. The lease term expires
July 2025 with an option to extend for six months. During 2103, the Company initiated claims with its insurance carriers and in October
2023, the Company received an initial, unallocated advance payment of $1 million, in June 2024, the Company received approximately $4.9
million and in August 2024 received approximately $1.1 million from its insurance carrier. Although the Company currently expects that
the Company's insurance coverage will

 compensate the Company for the majority of its
losses incurred in connection with the fire and related devastation, including the costs of its structures and equipment lost in the
fire, the loss in revenue from the lack of coffee sales, and the loss of income from the licensees, there can be no assurances the
Company will be fully compensated for such losses. The Company could experience losses in excess of its insured limits, and further
claims for certain losses could be denied or subject to deductibles or exclusions under its insurance policies. The Company has
relocated its offices to temporary office facilities located on its lands in Kaanapali and is in the planning and design stages of
relocating its coffee mill to its farm in Kaanapali.

 Inflation and Interest Rates

 High rates of inflation adversely
affect real estate development generally because of their impact on interest rates. However, high rates of inflation may permit the Company
to increase the prices that it charges in connection with land sales, subject to a slowdown in sales and increase in home construction
costs and to general economic conditions affecting the real estate industry and local market factors.

 High interest rates not only increase
the cost of borrowed funds to the Company, but can also have a significant effect on the affordability of permanent mortgage financing
to prospective purchasers.

 Water Use Permits

 By letters dated October 28, 2022,
CWRM officially designated all six Aquifer System Areas of the Lahaina Aquifer Sector, Maui, as Ground Water Management Areas, as of August
6, 2022. CWRM notified the Company that by August 5, 2023, the Company would need to apply for ground and surface water use permits to
continue the Company's use of certain wells that are integral to the Company's entire operations. The Company has submitted such applications
for permits. In response to the Company's applications for permits, the Company received letters dated July 19, 2024 from CWRM
requesting additional information for both of the Company's ground water and surface water applications. Such responses were due
within 30 days of the date of the letters. The Company obtained an extension for its responses to the letters and such responses were
subsequently submitted. The permits, when or if granted and subject to various conditions, would preserve the Company's existing water
uses as of August 6, 2022. The Company cannot provide any assurances that CWRM will approve such permit applications for the amounts of
water the Company seeks or impose conditions on such use that might affect the Company's operations. If CWRM should fail to approve
the Company's water requests or impose onerous conditions on its use, CWRM's actions could delay the Company's development
in substantial and material respects and affect the Company's operations and finances. Further, in the event permits adequate to
the Company's plans are not received timely or at all, there could be negative impacts on the west Maui real estate market as a whole
and the development and sale of the Company's lands on the Island of Maui, thereby materially and adversely affecting the Company's operations,
land sales, land values, results, and financial position.

 Pension Plan

 Pacific Trail Holdings LLC, the
manager of the Company, adopted a plan to freeze the benefit accruals under and close participation in the Company's former Pension
Plan (the "Pension Plan") and terminated the Pension Plan on or about June 1, 2022. The Company paid lump sum benefits totaling
approximately $0.42 million to Pension Plan participants during October 2022, thereby settling all Pension Plan liabilities. The remaining
assets of the terminated Pension Plan of approximately $14.5 million reverted to the Company on September 15, 2023.

 The Company transferred $5 million,
which was approximately 25% of the Pension Plan assets to a qualified replacement plan ("QRP"). The Company's contribution
to the QRP enabled the Company to reduce the excise tax due as a result of the Pension Plan termination from 50% to 20% of the amount
reverted to the Company. Such assets are maintained in a suspense account within the QRP pending allocation to plan participants. The
assets will be allocated to the participants in the QRP who were participants in the terminated Pension Plan and the employees of certain
affiliates of the Company and were concluded as eligible participants per the Employee Retirement Income Security Act ("ERISA")
required for QRPs. Such allocations are planned to be allocated ratably over a period not to exceed seven years to comply with regulatory
requirements. On February 26, 2024, approximately $1 million was allocated to the participants in the QRP.

 The Company paid the 20% excise
tax of approximately $2.9 million in October 2023. The funds freed up cash to better prepare the Company for tightening credit markets
and are available for, among other things, working capital requirements, including future operating expenses, the Company's obligations
for engineering, planning, regulatory and development costs, drainage and utilities, and potential environmental remediation costs on
existing properties.

 Land Development

 In September 2014, Kaanapali Land
Management Corp. ("KLMC"), pursuant to a property and option purchase agreement ("Purchase Agreement") with Newport
Hospital Corporation ("NHC"), sold a parcel of approximately 14.9 acres in West Maui. The Purchase Agreement included an Infrastructure
Improvement Agreement (as subsequently amended) which committed KLMC to fund up to $0.6 million depending on various factors, for off-site
roadway, sewer and electrical improvements that will also provide service to other KLMC properties. KLMC may, at its discretion, design,
construct, install, and complete all or portions of the off-site road, sewer and/or electrical improvements, in which case the developer
shall pay to KLMC the total costs thereof, less the KLMC committed amount. In relation to such sewer line improvement, KLMC entered into
a contract for $1.1 million, as amended, to install the sewer line. KLMC paid $1.1 million on the contract which has been recorded as
a receivable, less KLMC's sewer line commitment of $0.2 million. In accordance with the Infrastructure Improvement Agreement, the
receivable accrues interest of 6.5% and is secured by the 14.9 acre property. Due to the receipt of a Demand for Arbitration, discussed
below, as of December 31, 2024, the Company recorded a $1 million credit loss reserve on its receivable with NHC based on its evaluation
of the probability of default that exists at NHC. The amount of the credit loss reserve represents the entire receivable amount and interest
incurred as of December 31, 2024. In conjunction with the Infrastructure Improvement Agreement, the Company retains certain approval rights
relating to the uses and designs of the site to ensure the uses and designs are aligned with the Company's planned master development.
If such uses result in a dispute with the developer of the site, development of the site could be delayed. The 14.9 acre site is intended
to be used for a critical access hospital, skilled nursing facility, assisted living facility, and independent living facility.

 On August 5, 2024, NHC served
KLMC with a Demand for Arbitration, administrated by Dispute Prevention and Resolution, Inc. ("DPR"), relating to the Infrastructure
Improvement Agreement and NHC's development of the site. NHC alleges, among other things, that KLMC wrongfully caused significant
delays, increased costs and related damages to NHC with respect to NHC's planning and construction of the infrastructure improvements
required of NHC under the Infrastructure Improvement Agreement (as subsequently amended). NHC seeks judgment for declaratory relief that
the Infrastructure Improvement Agreement between NHC and KLMC is void; in the alternative, for reformation of the Infrastructure Improvement
Agreement; for award of damages in an amount to be proven at arbitration; for attorneys' fees and costs; for prejudgment and post-judgment
interest on any monetary award; and for such other and further relief as the arbitrator deems appropriate. On October 25, 2024, KLMC filed
an Answering Statement to NHC's Demand for Arbitration and KLMC's counterclaim against NHC. On November 5, 2024, DPR confirmed
the assignment of a mutually agreed upon arbitrator. The arbitration hearing is expected to begin in August 2025. The pre-arbitration
discovery process is ongoing. KLMC will continue to vigorously defend. However, there can be no assurance that the eventual outcome of
the arbitration will not result in any material liability or a material impact on business and financial results for KLMC.

 The Company is in the planning
stages for the development of a 295-acre parcel in KCF Mauka. The parcel is to be comprised of 61 agricultural lots that will be offered
to individual buyers. The Company expects to develop the parcel in phases and all phases have been submitted to the County for subdivision
approval. The Company has been working with the County to resolve certain of the County's comments relating to the subdivision.
The Company's understanding is that all outstanding comments from the County have been resolved verbally with County staff. The
final approval letter has been pending and additional efforts are being made to secure the approval. Upon final subdivision approval of
all phases and receipt of final plat of the first phase from the County, which requires a bond in the amount of the cost to develop the
first phase, the Company can pre-sell the undeveloped lots in the first phase. The Company expects to market the lots in the first phase
upon receiving final approvals from the County, subject to various contingencies, including, but not limited to, governmental and market
factors and the availability of a bond to secure the first phase of the development. Also critical to the Company's ability to develop
KCF Mauka is the Company's ability to secure water use permits from the State of Hawaii Commission on Water Resource Management
(CWRM). The purveyor for potable water for the Kaanapali service area, which would supply water to KCF Mauka, is in the process of preparing
an application to CWRM for a permit to secure the water needed to service the development. The Company is providing necessary information
to support the application. The Company cannot provide any assurance that CWRM will approve such permit application for the amount of
water needed or CWRM could impose conditions on such use that might affect the feasibility of the development. See below for further discussion
of CWRM. Therefore, there can be no assurance the Company will be able to meet such timetable, that the subdivision will ultimately be
approved or that the lots will sell for prices deemed advantageous by the Company.

 On June 3, 2024, KLMC
entered into a property sale agreement ("PVM Sales Agreement") with an unrelated third party for the sale of several
parcels of land, aggregating approximately 241 acres (the "PVM land parcels") within Pu'ukoli'i Village
Mauka located near the Kaanapali resort area, north of Lahaina, Hawaii. The closing of the sale of the PVM land parcels was subject
to the satisfactory completion of the developer's investigation and evaluation of the PVM land parcels during a specified due
diligence period, and prior to the expiration of the due diligence period on November 15, 2024, the developer had not delivered a
notice to proceed. Therefore, the PVM Sales Agreement terminated pursuant to its terms on November 15, 2024.

 Due to the termination of the
PVM Sales Agreement, the Company is continuing with its planning for the development of a 241-acre residential development site in the
region south of Kaanapali Coffee Farms known as Puukolii Village. The conceptual master plan is comprised of 20 developable parcels planned
for 940 units including a mix of affordable and market priced homes, both single and multi-family, mixed use commercial, parks, school,
and community facilities. Puukolii Village is fully entitled. Critical to the Company's ability to develop Puukolii Village is the
Company's ability to secure water use permits from the State of Hawaii Commission on Water Resource Management (CWRM). The purveyor
for potable water for the Kaanapali service area, which would supply water to Puukolii Village, is in the process of preparing an application
to CWRM for a permit to secure the water needed to service the development. The Company is providing necessary information to support
the application. The Company cannot provide any assurance that CWRM will approve such permit application for the amount of water needed
or CWRM could impose conditions on such use that might affect the feasibility of the development. See below for further discussion of
CWRM. In conjunction with the potential development of Puukolii Village and in coordination with the possible development by an unrelated
third party of the 14.9 acre site to be used for a critical access hospital, as noted above, the Company entered into a contract to install
a sewer line from the Puukolii Village site to the critical care hospital site. The developer of the critical access hospital site is
obligated to share in the sewer line cost for the portion of the sewer line fronting the critical care hospital site (see discussion above).

 Comparison of Results of Operations

 2024 Compared to 2023

 The decrease in retirement
plan investments as of December 31, 2024 as compared to December 31, 2023, is primarily due to the QRP allocation that was made to
plan participants during the first quarter of 2024.

 The decrease in other assets
as of December 31, 2024 as compared to December 31, 2023, is primarily due to recording a credit loss reserve related to the Demand
for Arbitration from the Newport Hospital Corporation during the second quarter of 2024.

 The decrease in deposits
and deferred gains as of December 31, 2024 as compared to December 31, 2023 is primarily due to the recognition of an insurance advance
during 2024 to purchase mill replacement equipment.

 The decrease in sales for
the year ended December 31, 2024 as compared to the year ended December 31, 2023 is primarily due to the reduction of coffee sales
as a result of the Lahaina wildfire.

 The increase in selling,
general and administrative expenses for the year ended December 31, 2024 as compared to the year ended December 31, 2023 is due to
the derecognition of a contingent liability related to the D/C Distribution bankruptcy case during second quarter 2023.

 The decrease in excise tax
expense for the year ended December 31, 2024 as compared to the year ended December 31, 2023 is due to the excise taxes paid in 2023 related
to the terminated Pension Plan.

 The increase in insurance
proceeds for the year ended December 31, 2024 as compared to the year ended December 31, 2023 is due to the recognition of an insurance
advance during the first quarter of 2024 to purchase mill replacement equipment as well as approximately $6 million received from the
Company's insurance carriers as a result of the Lahaina wildfire.

 See also the notes in the
condensed consolidated financial statements included in Item 8, for additional discussion of items addressing comparability between years.

 Liquidity and Capital Resources

 The primary business of Kaanapali
Land is the investment in and development of the Company's assets on the Island of Maui. The various development plans will take many
years at significant expense to fully implement. Reference is made to Item 1 - Business, Note 6 to the consolidated financial statements
and other footnotes to the consolidated financial statements included in Item 8. Proceeds from land sales are the Company's only
source of significant cash proceeds and the Company's ability to meet its liquidity needs is dependent on the timing and amount of such
proceeds.

 The Company's operations
have in recent periods been primarily reliant upon the net proceeds of sales of developed and undeveloped land parcels.

 The Company had cash and
cash equivalents of approximately $23 million as of December 31, 2024, which is available for, among other things, working capital
requirements, including future operating expenses, the rebuilding of the coffee mill and replacement of equipment and structures destroyed
in the Lahaina wildfire, and the Company's obligations for engineering, planning, regulatory and development costs, drainage and utilities,
environmental remediation costs on existing and former properties, potential liabilities resulting from tax audits, and existing and possible
future litigation. The Company does not anticipate making any distributions for the foreseeable future.

 The Company's liquidity
is influenced by many factors, including the coverage and timing of insurance proceeds, the impact of the Lahaina wildfire (including
on the marketability of property), coffee sales, and completion of property sales on acceptable terms, if at all. Although the Company
believes that it has sufficient liquidity to fund its operations and capital needs over the near term, should the Company be unable to
satisfy its liquidity requirements from its existing resources and future property sales, it will likely pursue alternate financing arrangements.
However it cannot be determined at this time what, if any, financing alternatives may be available and at what cost.

 Critical Estimates and Significant Accounting
Policies

 The discussion and analysis
of the Company's financial condition and results of operations are based upon the Company's consolidated financial statements, which have
been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements
requires management to make estimates, assumptions, and judgments that affect the reported amounts of assets, liabilities, revenues and
expenses, and related disclosures of contingent assets and liabilities. These estimates are based on historical experience and on various
other assumptions that management believes are reasonable under the circumstances; additionally management evaluates these results on
an on-going basis. Management's estimates form the basis for making judgments about the carrying values of assets and liabilities that
are not readily apparent from other sources. Different estimates could be made under different assumptions or conditions, and in any event,
actual results may differ from the estimates. The impact of a change in these estimates, assumptions, and judgments could materially affect
the amounts reported in the Company's consolidated financial statements.

 The Company reviews its
property for impairment of value if events or circumstances indicate that the carrying amount of its property may not be recoverable.
Such reviews contain uncertainties due to assumptions and judgments considering certain indicators of impairment such as significant
changes in asset usage, significant deterioration in the surrounding economy or environmental problems. If such indications are present
and the undiscounted cash flows estimated to be generated by those assets are less than the assets' carrying value, the Company will
adjust the carrying value down to its estimated fair value. Fair value is based on management's estimate of the property's fair value
based on discounted projected cash flows. If significant changes occur in future periods, future operating results could be materially
impacted.

 Deferred income taxes are
accounted for in accordance with FASB ASC Topic 740 – Income Taxes. Deferred income taxes reflect the net tax effects of temporary
differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax
purposes. Topic 740 requires that deferred tax assets be reduced by a valuation allowance if it is more likely than not that some portion
of the deferred income tax asset will not be realized. The Company has a deferred tax asset related to federal net operating losses (NOLs)
of $8,289, of which $4,063 has been subject to a valuation allowance. Such allowance is subject to assumptions and judgment. If the Company
generates taxable income in future years and the Company determines that the valuation allowance is no longer required, the tax benefit
for the remaining deferred tax asset will be recognized at that time. Reference is made to Note 4 to the consolidated financial statements
included in Item 8 for further discussion.

 Material legal proceedings of
the Company include Kaanapali Land, as successor by merger to other entities, and D/C having been named as defendants in personal injury
actions allegedly based on exposure to asbestos. Cases against Kaanapali Land are allegedly based on its prior business operations in
Hawaii and cases against D/C are allegedly based on sale of asbestos-containing products by D/C's prior distribution business operations
primarily in California. Predicting the outcome of such claims and estimating the costs and exposure requires the Company to make estimates,
assumptions, and judgments that could result in actual costs to be materially different from such estimates. Reference is made to Note 7
to the consolidated financial statements included in Item 8 for further discussion.

 Item 7A. Quantitative and Qualitative Disclosures
About Market Risk

 The Company's future earnings,
cash flows and fair values relevant to financial instruments are dependent upon prevailing market rates. Market risk is the risk of loss
from adverse changes in market prices and interest rates. The Company manages its market risk by matching projected cash inflows from
operating properties, financing activities, and investing activities with projected cash outflows to fund capital expenditures and other
cash requirements. The Company does not enter into financial instruments for trading purposes.

 Item 8. Financial Statements and Supplementary
Data

 Report of Independent Registered Public Accounting
Firm (PCAOB ID Number 248)

 Consolidated Balance Sheets, December 31, 2024
and 2023

 Consolidated Statements of Operations for the
years ended December 31, 2024 and 2023

 Consolidated Statements of Equity for the years
ended December 31, 2024 and 2023

 Consolidated Statements of Cash Flows for the
years ended December 31, 2024 and 2023

 Notes to Consolidated Financial Statements

 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 The Managing Member and Stockholders

 Opinion on the financial statements

 We have audited the accompanying consolidated balance sheets of Kaanapali
Land LLC (a Delaware limited liability company) and subsidiaries (the "Company") as of December 31, 2024 and 2023, the related
consolidated statements of operations, equity, and cash flows for each of the two years in the period ended December 31, 2024, and the
related notes (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial
statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results
of its operations and its cash flows for each of the two years in the period ended December 31, 2024, in conformity with accounting principles
generally accepted in the United States of America.

 Basis for opinion

 These 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 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 audit to obtain reasonable assurance about whether the 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 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 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 financial statements. We believe that our audits provide a reasonable basis for our opinion.

 Critical audit matters

 Critical audit matters are matters arising from the current period audit
of the 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 financial statements and (2) involved our especially challenging, subjective, or complex judgments.
We determined that there are no critical audit matters.

 /s/ GRANT THORNTON LLP

 We have served as the Company's auditor
since 2015.

 Dallas, Texas

 March 24, 2025

 Consolidated Balance Sheets

 December 31, 2024 and 2023

 (Dollars in Thousands, except share data)

 2024

 2023

 Assets

 Cash and cash equivalents

 $

 23,082

 $

 26,260

 Property, net

 62,992

 60,200

 Retirement plan investments

 4,255

 5,067

 Other assets, net

 1,492

 Total assets

 $

 90,967

 $

 93,019

 Liabilities

 Accounts payable and accrued expenses

 $

 $

 Deposits and deferred gains

 1,433

 Deferred income taxes

 5,769

 5,979

 Other liabilities

 2,063

 1,550

 Total liabilities

 9,184

 9,308

 Commitments and contingencies (Note 7)

 Equity

 Common equity, at 12/31/2024 and 12/31/2023

 Shares authorized – Common shares unlimited,
 Class C shares

 52,000;Common
 shares issued and outstanding 1,792,613

 at 12/31/2024
 and 12/31/2023, Class C shares issued and

 outstanding
 52,000 at 12/31/2024 and 12/31/2023

 --

 --

 Additional paid-in capital

 5,471

 5,471

 Accumulated earnings

 76,312

 78,240

 Total shareholders' equity

 81,783

 83,711

 Total liabilities and shareholders' equity

 $

 90,967

 $

 93,019

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

 Consolidated Statements of Operations

 Years ended December 31, 2024 and 2023

 (Dollars in Thousands except Per Share Amounts)

 2024

 2023

 Revenues:

 Sales and lease income

 $

 $

 2,990

 Interest and other income

 1,445

 1,726

 Crop insurance proceeds

 --

 1,951

 5,254

 Cost and expenses:

 Cost of sales

 2,774

 2,858

 Selling, general and administrative

 6,516

 ( 804)

 Excise tax expense

 --

 2,952

 Depreciation and amortization

 9,495

 5,204

 Operating income (loss) before other income and income
taxes

 ( 7,544)

 Other income:

 Net gain on property damage
 and lost profits, net of insurance claims

 6,243

 6,243

 Income (loss) before income taxes

 ( 1,301)

 Income tax benefit (expense)

 3,343

 Net income (loss)

 $

 $

 3,707

 Net income (loss) per share – basic and diluted

 $

 ( 0.59)

 $

 2.01

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

 Consolidated Statements of Equity

 Years ended December 31, 2024 and 2023

 (Dollars in Thousands)

 Common

 Stock

 Additional

 Paid-In

 Capital

 Accumulated

 (Deficit)

 Earnings

 Total

 Stockholders'

 Equity

 Balance
 December 31 2022

 $

 --

 $

 5,471

 $

 74,533

 $

 80,004

 Net income

 --

 --

 3,707

 3,707

 Balance
 December 31, 2023

 --

 5,471

 78,240

 83,711

 Distribution
 for retirement plan contribution for employees

 of affiliates under common
 control

 --

 --

 ( 837)

 ( 837)

 Net loss

 --

 --

 Balance
 December 31, 2024

 $

 --

 $

 5,471

 $

 76,312

 $

 81,783

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

 Consolidated Statements of Cash Flows

 Years ended December 31, 2024 and 2023

 (Dollars in Thousands)

 2024

 2023

 Cash flows from operating activities:

 Net income (loss)

 $

 $

 3,707

 Adjustments
 to reconcile net income (loss) to net cash

 provided by
 (used in) operating activities:

 Proceeds from insurance

 ( 5,970)

 --

 Interest from retirement plan
 investments

 ( 207)

 --

 Depreciation and amortization

 Credit loss reserve

 --

 Deferred income taxes

 ( 210)

 ( 3,343)

 Insurance proceeds from
 business interruption

 3,827

 --

 Changes in operating assets and liabilities:

 Investments

 --

 19,115

 Retirement plan investments

 --

 ( 5,067)

 Other assets

 ( 134)

 ( 598)

 Accounts
 payable, accrued expenses, deposits, deferred gains and other

 ( 187)

 ( 5,859)

 Net cash provided by (used in) operating activities

 ( 2,779)

 8,153

 Cash flows from investing activities:

 Property additions

 ( 2,997)

 ( 1,823)

 Receivable due to sewer line installation

 --

 ( 885)

 Insurance proceeds from casualty loss

 2,416

 1,000

 Proceeds from retirement plan
 investments

 1,019

 --

 Net cash used in investing activities

 ( 1,708)

 Cash flows from financing activities:

 Distribution
 for retirement plan contribution for employees of affiliates

 under
 common control

 ( 837)

 --

 Net cash provided by (used in) financing activities

 ( 837)

 --

 Net
 increase (decrease) in cash and cash equivalents

 ( 3,178)

 6,445

 Cash
 and cash equivalents at beginning of year

 26,260

 19,815

 Cash
 and cash equivalents at end of year

 $

 23,082

 $

 26,260

 Supplemental Cash Flow Information:

 Income taxes paid

 $

 $

 --

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

 Notes to Consolidated Financial Statements

 (Dollars in Thousands)

 (1) Summary of Significant Accounting Policies

 Basis of Presentation

 The accompanying consolidated
financial statements include the accounts of Kaanapali Land, LLC and all of its subsidiaries and its predecessors (collectively, the "Company")
("Kaanapali Land"). All significant intercompany transactions and balances have been eliminated in consolidation.

 There are 1,792,613 Common
Shares and 52,000 Class C Shares issued, all of which are outstanding at December 31, 2024.

 The Company's continuing
operations are in two business segments - Agriculture and Property. The Agriculture segment primarily engages in farming, harvesting and
milling operations relating to coffee orchards and also cultivates, harvests and sells bananas and citrus fruits and engages in certain
ranching operations. The Property segment primarily develops land for sale and negotiates bulk sales of undeveloped land. The Property
and Agriculture segments operate exclusively in the State of Hawaii. For further information on the Company's business segments see Note
7.

 Property is stated at cost.
Depreciation is based on the straight-line method over the estimated economic lives of 15 - 40
 years for the Company's depreciable land improvements, 3 - 18
 years for machinery and equipment. Maintenance and repairs are charged to operations as incurred. Significant betterments and
improvements are capitalized and depreciated over their estimated useful lives.

 2024

 2023

 Property, net:

 Land
 and land improvements

 $

 60,942

 $

 59,874

 Buildings

 Machinery and equipment

 6,405

 4,330

 68,159

 65,162

 Accumulated depreciation

 ( 5,167)

 ( 4,962)

 Property, net

 $

 62,992

 $

 60,200

 The Company's significant property holdings
are on the island of Maui consisting of approximately 3,900 acres, of which approximately 1,500 acres is classified as conservation land
which precludes development. The Company has determined, based on its current projections for the development and/or disposition of its
property holdings, that the property holdings are not currently recorded in an amount in excess of proceeds that the Company expects
that it will ultimately obtain from the operation and disposition thereof.

 Inventory of land held for
sale, if any, is carried at the lower of cost or fair market value, less costs to sell, which is based on current and foreseeable market
conditions, discussions with real estate brokers and review of historical land sale activity (Level 2 and 3). The Company has determined
that none of its properties currently meet held for sale criteria. Land is currently utilized for commercial specialty coffee farming
operations which also support the Company's land development program, as well as, farming bananas, citrus, other farm products,
and ranching operations. Additionally, miscellaneous parcels of land had been leased or licensed to third parties on a short term basis
prior to the Lahaina wildfire, as discussed below.

 Beginning on August 8, 2023,
a wildfire occurred due east of historic Lahaina town in Maui. The fire spread rapidly due to extreme wind conditions caused in part
by Hurricane Dora which traveled 800 miles offshore west of Maui. The fires caused multiple fatalities, widespread damage to Lahaina
town and the surrounding area including the Company's 19-acre Pioneer Mill Site. The Company's offices and coffee mill
were located on the site as well as various other structures including a building which was leased to an unrelated third party and
used to operate a coffee store. The Company also utilized portions of the property for short term license agreements with third
parties that generated income for the Company. Although no employees were injured in the fire, the Company's offices and
coffee store building were destroyed. Additionally, most of the personal property of the licensees and the coffee mill was
destroyed. The widespread destruction has caused disruptions in the Company's development plans. The damage to the coffee mill
has disrupted operations and prevented the Company from processing and selling the 2023 and 2024 year coffee crop. The costs
associated with harvesting and destroying the annual coffee crop is recorded within cost of sales in the consolidated statement of
operations for the year ended December 31, 2024. It is also likely that the fires and devastation caused thereby will adversely
affect the long-term Maui economy and businesses operated on Maui. Maui hotel occupancy and average daily rates have declined during
2024 as the Lahaina wildfire continues to disrupt tourism. Maui's recovery from the wildfire remains slow. Clean up of Lahaina
has been substantially completed by U.S. Army Corps of Engineers ("USACE") contractors. The property is currently leased
by a USACE contractor and was used as a base yard for the clean-up of Lahaina. The lease term expires July 2025 with an option to
extend for six months. During 2023, the Company initiated claims with its insurance carriers. In October 2023, the Company received
an initial, unallocated advance payment of $ 1,000
from its insurance carrier. In June 2024, the Company received $ 4,882
and in August 2024 received $ 1,088,
both of which are recorded within insurance proceeds in the consolidated statement of operations for the year ended December 31,
2024. Although the Company currently expects that the Company's insurance coverage will compensate the Company for the
majority of its losses incurred in connection with the fire and related devastation, including the costs of its structures and
equipment lost in the fire, the loss in revenue from the lack of coffee sales, or the loss of income from the licensees, there can
be no assurances the Company will be fully compensated for such losses. The Company could experience losses in excess of our insured
limits, and further claims for certain losses could be denied or subject to deductibles or exclusions under our insurance policies.
The Company has relocated its offices to temporary office facilities located on its lands in Kaanapali and is in the planning and
design stages of relocating its coffee mill to its farm in Kaanapali.

 The Company reviews its property
for impairment of value if events or circumstances indicate that the carrying amount of its property may not be recoverable. Such reviews
contain uncertainties due to assumptions and judgments considering certain indicators of impairment such as significant changes in asset
usage, significant deterioration in the surrounding economy or environmental problems.

 Provisions for impairment losses
related to long-lived assets, if any, are recognized when expected future cash flows are less than the carrying values of the assets.
If indicators of impairment are present, the Company evaluates the carrying value of the related long-lived assets in relationship to
the future undiscounted cash flows of the underlying operations or anticipated sales proceeds. The Company adjusts the net book value
of property to fair value if the sum of the expected undiscounted future cash flow or sales proceeds is less than book value. Assets held
for sale are recorded at the lower of the carrying value of the asset or fair value less costs to sell.

 As a result of the fires, the Company performed an impairment evaluation
of its asset groups to determine if provisions for impairment losses should be recognized. Based on the evaluation and continued monitoring,
the Company concluded a provision for impairment should not be recognized for the year ended December 31, 2024. The Company will
continue to monitor and evaluate the indicators for evidence of impairment in future periods. There can be no assurance that future impairment
testing will not indicate that impairment has occurred and that a provision for impairment will be required.

 While most of the personal
property destroyed in the fire was fully depreciated the Company wrote off the net carrying value of destroyed property and
equipment totaling approximately $ 413,
which was offset against a portion of the net gain on property damage and lost profits, net of insurance claims on the Company's consolidated financial statements at December 31, 2023.

 Use of Estimates

 The preparation of financial
statements in conformity with generally accepted accounting principles in the United States ("GAAP") requires management to
make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could
differ from those estimates.

 Cash and Cash Equivalents

 The Company considers as
cash equivalents all investments with maturities of three months or less when purchased. Included in this balance as of December 31,
2024 is a money market fund for $ 21,760 that is considered to be a fair value hierarchy Level 1 investment.
Interest and other income include interest earned on the money market funds. The Company's cash balances are maintained primarily
in two financial institutions. Such balances significantly exceed the Federal Deposit Insurance Corporation insurance limits. Management
does not believe the Company is exposed to significant risk of loss on cash and cash equivalents.

 Allowance
 for Credit Loss Reserve

 Allowances for credit loss are based on the Company's assessment
of the collectability of receivables considering delinquency status and related aging, if applicable, and an evaluation of expected risk
of credit loss based on current conditions and reasonable and supportable forecasts of future economic conditions over the life of receivable.
Account balances would be charged off against the allowance after all means of collection have been exhausted and the potential for recovery
is considered remote. The Company's exposure
to credit losses on accounts receivable is limited to its receivable from Newport Hospital Corporation ("NHC"). The Company
established a reserve for doubtful accounts based on the receipt of a Demand for Arbitration received from NHC and as of December 31,
2024, the Company recorded a $ 988 credit loss reserve. The credit loss reserve is recorded within other assets, net in the consolidated
balance sheet at December 31, 2024. Reference is made to Note 2, Land Development for further discussion.

 Subsequent Events

 The Company has performed
an evaluation of subsequent events from the date of the financial statements included in this annual report through the date of its filing
with the Securities and Exchange Commission. For further information on the Company's subsequent events see Note 9.

 Revenue Recognition

 Revenue from real property
sales is recognized at the time of closing when control of the property transfers to the customer. After closing of the sale transaction,
the Company has no remaining performance obligation.

 Other revenues are recognized
when control of goods or services transfers to the customers, in the amount that the Company expects to receive for the transfer of goods
or provision of services.

 Revenue recognition standards
require entities to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the
consideration to which the entity expects to be entitled to receive in exchange. The revenue recognition standards have implications
for all revenues, excluding those that are under the specific scope of other accounting standards.

 The Company's
revenues that were subject to revenue recognition standards for the years ended December 31, 2024 and 2023, were $ 300 and
 $ 2,283, respectively, related to coffee and other sales.

 The
 revenue recognition standards require the use of a five-step model to recognize revenue from
 customer contracts. The five-step model requires that 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.

 In accordance with the core
principle of ASC 606, revenue from real property sales is recognized at the time of closing when control of the property transfers to
the customer. After closing of the sale transaction, the Company has no remaining performance obligation. When the sale does not meet
the requirements for full profit recognition, all or a portion of the profit is deferred until such requirements are met.

 Other revenues in the scope
of ASC 606 are recognized when control of goods or services transfers to the customers, in the amount that the Company expects to receive
for the transfer of goods or provision of services.

 Lease Accounting

 The Company's lease
arrangements, both as lessor and as lessee, are short-term leases. The Company leases land to tenants under operating leases, and the
Company leases property, primarily office and storage space, from lessors under operating leases. During the years ended December 31,
2024 and 2023, the Company recognized $ 206
 and $ 707,
respectively, of lease income, substantially comprised of non-variable lease payments. During the years ended December 31, 2024
and 2023, the Company recognized $ 205
 and $ 106
, respectively, of lease expense, substantially comprised of non-variable lease payments. The majority of the
Company's leases to tenants were terminated due to the Lahaina wildfire.

 Recently Issued Accounting Pronouncements

 In October 2023, the FASB issued
ASU No. 2023-06 ("ASU 2023-06"), Disclosure Improvements - Codification Amendment in Response to the SEC's Disclosure
Update and Simplification Initiative. This ASU modified the disclosure and presentation requirements of a variety of codification topics
by aligning them with the SEC's regulations. The amendments to the various topics should be applied prospectively, and the effective
date will be determined for each individual disclosure based on the effective date of the SEC's removal of the related disclosure.
If the SEC has not removed the applicable requirements from Regulation S-X or Regulation S-K by June 30, 2027, then this ASU will not
become effective. Early adoption is prohibited. While the Company is currently evaluating the effect that implementation of this update
will have on its consolidated financial statements, no significant impact is anticipated.

 In November 2023, the FASB issued
ASU No. 2023-07 ("ASU 2023-07"), Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures to
improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. In addition,
the amendments in the ASU enhance interim disclosure requirements, clarify circumstances in which an entity can disclose multiple segment
measures of profit or loss, provide new segment disclosure requirements for entities with a single reportable segment, and contain other
disclosure requirements. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal
years beginning after December 15, 2024, and requires retrospective application to all prior periods presented in the financial statements.
The adoption of ASU 2023-07 is disclosed in the Company's business segments. Reference is made to Note 7. Business Segment Information.

 In December 2023, the FASB issued
ASU No. 2023-09 ("ASU 2023-09"), Income Taxes (Topic 740): Improvement to Income Tax Disclosures to enhance the
transparency and decision usefulness of income tax disclosures, primarily related to the rate reconciliation and income taxes paid information.
ASU 2023-09 is effective for annual periods beginning after December 15, 2024, on a prospective basis. Early adoption is permitted. While
the Company is currently evaluating the effect that implementation of this update will have on its consolidated financial statements,
no significant impact is anticipated.

 In November 2024, the FASB issued
ASU No. 2024-03 ("ASU 2024-03"), Income Statement - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of
Income Statement Expenses. This ASU requires entities to improve the disclosures about business expenses and provide more detailed information
about the types of expenses in commonly presented expense captions. In addition, the amendments in the ASU improve financial reporting
by requiring that entities disclose additional information about specific expense categories in the notes to financial statements at interim
and annual reporting periods. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim periods within
fiscal years beginning after December 15, 2027, and requires retrospective application to all prior periods presented in the financial
statements. Early adoption is permitted. While the Company is currently evaluating the effect that implementation of this update will
have on its consolidated financial statements, no significant impact is anticipated.

 Other Liabilities

 Other liabilities are comprised
of estimated liabilities for losses, commitments and contingencies related to various divested assets or operations. These estimated
liabilities include the estimated effects of certain asbestos related claims, obligations related to former officers and employees such
as pension, post-retirement benefits and workmen's compensation. Management's estimates are based, as applicable, on taking into consideration
claim amounts filed by third parties, life expectancy of beneficiaries, advice of consultants, negotiations with claimants, historical
settlement experience, the number of new cases expected to be filed and the likelihood of liability in specific situations. Management
periodically reviews the adequacy of each of its loss contingency amounts and adjusts such as it determines the appropriate loss contingency
amount to reflect current information. Reference is made to Note 6, Commitments and Contingencies.

 Income Taxes

 Income taxes are accounted
for under the asset and liability approach which requires recognition of deferred tax assets and liabilities for the differences between
the financial reporting and tax basis of assets and liabilities. A valuation allowance reduces deferred tax assets when it is more likely
than not some portion or all of the deferred tax assets will not be realized. As of December 31, 2024 and 2023, there were no uncertain
tax positions that had a material impact on the Company's consolidated financial statements.

 (2) Land Development

 In September 2014, Kaanapali
Land Management Corp. ("KLMC"), pursuant to a Property and option purchase agreement ("Purchase Agreement") with
Newport Hospital Corporation ("NHC"), sold a parcel of approximately 14.9 acres in West Maui. The Purchase Agreement included
an Infrastructure Improvement Agreement (as subsequently amended) which commits KLMC to fund up to $ 583,
depending on various factors, for off-site roadway, sewer and electrical improvements that will also provide service to other KLMC properties.
KLMC may, at its discretion, design, construct, install, and complete all or portions of the off-site road, sewer and/or electrical improvements,
in which case the developer shall pay to KLMC the total costs thereof, less the KLMC committed amount. In relation to such sewer line
improvement, KLMC entered into a contract for $ 1,137,
as amended, to install the sewer line. KLMC paid $ 1,108
 on the contract which has been recorded as a receivable, less KLMC's sewer line commitment of $ 208.
In accordance with the Infrastructure Improvement Agreement, the receivable accrues interest of 6.5 %
and is secured by the 14.9 acre property. Due to the receipt of a Demand for Arbitration, discussed in Note 6, Commitments and Contingencies,
as of December 31, 2024, the Company recorded a $ 988
 credit loss reserve on its receivable with NHC based on its evaluation of the probability of default that exists at NHC. The amount
of the credit loss reserve represents the entire receivable amount and interest incurred as of December 31, 2024. The provision for credit
loss reserve is recorded within selling, general and administrative expenses in the consolidated statement of operations for the year
ended December 31, 2024. In conjunction with the Infrastructure Improvement Agreement, the Company retains certain approval rights relating
to the uses and designs of the site to ensure the uses and designs are aligned with the Company's planned master development. If
such uses result in a dispute with the developer of the site, development of the site could be delayed. The 14.9 acre site is intended
to be used for a critical access hospital, skilled nursing facility, assisted living facility, and independent living facility.

 On June 3, 2024, KLMC
entered into a property sale agreement ("PVM Sales Agreement") with an unrelated third party for the sale of several
parcels of land, aggregating approximately 241 acres (the "PVM land parcels") within Pu'ukoli'i Village
Mauka located near the Kaanapali resort area, north of Lahaina, Hawaii. The closing of the sale of the PVM land parcels was subject
to the satisfactory completion of the developer's investigation and evaluation of the PVM land parcels during a specified due
diligence period, and prior to the expiration of the due diligence period on November 15, 2024, the developer had not delivered a
notice to proceed. Therefore, the PVM Sales Agreement terminated pursuant to its terms on November 15, 2024.

 On June 13, 2024, Pioneer
Mill Company, LLC. ("PMC"), entered into a property sale agreement ("PMC Sales Agreement") with an unrelated
third party for the sale of four parcels of land, aggregating approximately 20 acres (the "PMS land parcels") located in
Lahaina, Hawaii. Pursuant to the PMC Sales Agreement, the sales price for the PMS land parcels is $ 20,000,
and the closing of the sale of the PMS land parcels is subject to the due diligence period. On August 12, 2024, pursuant to an
amendment to the PMC Sales Agreement, the due diligence period was extended to October 2, 2024. On October 2, 2024, pursuant to
a Second Amendment to the PMC Sales Agreement, the due diligence period was extended to November 1, 2024. On October 31, 2024,
pursuant to a Third Amendment to the PMC Sales Agreement, the PMC Sales Agreement was modified to extend the deadline for the
purchaser to deliver the Notice to Proceed to November 29, 2024. A notice to proceed was received from the purchaser in accordance
with the PMC Sales Agreement, as amended. The purchaser has deposited a total of $ 2,000
into an escrow account, managed by a title company, established for the sale of the property. The property is currently leased by a
USACE contractor and was used as a base yard for the clean-up of Lahaina. The lease term expires July 2025 with an option to extend
for six months. The purchaser has the right to terminate the PMC Sales Agreement depending on various factors, including
environmental testing of the property which will commence after the subcontractor vacates the property. As the PMC Sales Agreement
is subject to certain conditions, including the results of the environmental testing, there can be no assurance that the sale of the
PMS land parcels will be completed under the existing or any other terms of the PMC Sales Agreement, if at all.

 Project costs associated
with the development and construction of real estate projects are capitalized and classified as Property, net. Such capitalized costs
are not in excess of the projects' estimated fair value as reviewed periodically or as considered necessary. In addition, interest, insurance
and property tax are capitalized to qualifying assets during the period that such assets are undergoing activities necessary to prepare
them for their intended use.

 For development projects,
capitalized costs are allocated using the direct method for expenditures that are specifically associated with the lot being sold and
the relative-sales-value method for expenditures that benefit the entire project.

 (3) Retirement Plan Investments

 Prior to June 1, 2022, the Company
participated in a defined benefit pension plan (the "Pension Plan") that covered substantially all its eligible employees.
The Pension Plan was sponsored and maintained by Kaanapali Land in conjunction with other plans providing benefits to employees of Kaanapali
Land and its affiliates.

 Pacific Trail Holdings LLC, the
manager of the Company, adopted a plan to freeze the benefit accruals under and close participation in the Pension Plan and terminate
the Pension Plan on June 1, 2022. Effective February 7, 2022, the fair value hierarchy Level 1 and Level 2 plan asset investments were
reallocated to a money market fund. Benefit accruals were frozen on March 31, 2022. The Company paid lump sum benefits totaling approximately
$ 420 to Pension Plan participants during October 2022, thereby settling all benefit Pension Plan liabilities. The remaining assets of
the terminated Pension Plan of approximately $ 14,547 reverted to the Company on September 15, 2023.

 On September 8, 2023, the
Company transferred $ 5,000
which was approximately 25 %
of the Pension Plan assets to a qualified replacement plan ("QRP"). The Company's contribution to the QRP enabled
the Company to reduce the excise tax due as a result of the Pension Plan termination from 50% to 20% of the amount reverted to the
Company. The Company paid the 20% excise tax of approximately $ 2,900
in October 2023. In accordance with U.S. GAAP, the amount transferred to the QRP is reflected as Retirement plan investments on the
Company's consolidated balance sheet as of December 31, 2024. Such assets are considered to be a fair value hierarchy Level 1
investment, and are maintained in a suspense account within the QRP pending allocation to plan participants. The assets will be
allocated to the participants in the QRP who were participants in the terminated Pension Plan and the employees of certain
affiliates, all of which have some degree of common ownership with the Company and were concluded as eligible participants per the
Employee Retirement Income Security Act ("ERISA") requirements for QRPs. Such allocations are planned to be allocated
ratably over a period not to exceed seven years to comply with regulatory requirements. On February 26, 2024, approximately $ 1,019
was allocated to the participants in the QRP. Approximately $ 182
was allocated to participants in the terminated Pension Plan and is reflected in general and administrative expenses in the
consolidated statement of operations for the year ended December 31, 2024 and approximately $ 837
was allocated to employees of affiliated companies and is reflected as a distribution from accumulated earnings on the consolidated
balance sheet as of December 31, 2024.

 The Company maintains a nonqualified
deferred compensation arrangement (the "Rabbi Trust") which provides certain former directors of Amfac Hawaii, LLC (now known
as KLC Land Company, LLC, a direct subsidiary of Kaanapali Land through which the Company conducts substantially all of its operations)
and their spouses with pension benefits. The deferred compensation liability of $ 271 and $ 244, included in Other liabilities, and assets
funding such deferred compensation liability of $ 15 and $ 13, included in Other assets, are consolidated in the Company's consolidated
balance sheet as of December 31, 2024 and 2023, respectively.

 (4) Income
Taxes

 Income tax expense/(benefit)
attributable to income from continuing operations for the years ended December 31, 2024 and 2023 consist of:

 Current

 Deferred

 Total

 Year ended December 31, 2024:

 U.S. federal

 $

 --

 $

 ( 283)

 $

 ( 283)

 State

 --

 $

 --

 $

 ( 210)

 $

 ( 210)

 Year ended December 31, 2023:

 U.S. federal

 $

 --

 $

 ( 2,700)

 $

 ( 2,700)

 State

 --

 ( 643)

 ( 643)

 $

 --

 $

 ( 3,343)

 $

 ( 3,343)

 The Tax Cuts and Jobs Act
of 2017 is a comprehensive tax reform bill containing a number of other provisions that either currently or in the future could impact
the Company, particularly the effect of certain limitations effective for the tax year 2018 and forward (prior losses remain subject to
the prior 20 year carryover period) on the use of federal net operating loss ("NOLs") carryforwards which will generally be
limited to being used to offset 80% of future annual taxable income.

 Income tax expense/(benefit) attributable
to income from continuing operations differs from the amounts computed by applying the U.S. federal income tax rate of 21
 percent effective for 2024 and 2023 and prior years to pretax income from operations as a result of the following:

 2024

 2023

 Federal provision at 21%

 $

 ( 275)

 $

 State provision at 5%

 ( 66)

 Federal NOLs utilized

 --

 ( 2,395)

 Federal NOLs generated

 --

 --

 State NOLs utilized

 --

 ( 950)

 State NOLs generated

 --

 Other

 ( 93)

 Total

 $

 ( 210)

 $

 ( 3,343)

 Deferred income taxes reflect
the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes
and the amounts used for income tax purposes. The deferred tax effects of temporary differences at December 31, 2024 and 2023 are
as follows:

 December
 31,

 December
 31,

 2024

 2023

 Deferred tax assets:

 Loss contingencies related primarily

 to losses on divestitures,
 less

 recognized insurance
 recovery

 $

 $

 Loss carryforwards

 10,774

 10,057

 Other, net

 Total deferred tax assets

 11,536

 10,729

 Less – valuation allowance

 6,549

 6,422

 Total deferred tax assets

 4,987

 4,307

 Deferred tax liabilities:

 Property, plant and equipment, principally

 due to purchase accounting
 adjustments,

 net of impairment charges

 10,756

 10,286

 Prepaid pension costs

 --

 --

 Total deferred tax liabilities

 10,756

 10,286

 Net deferred tax liability

 $

 5,769

 $

 5,979

 As of December 31, 2024, the
Company has a deferred tax asset related to federal NOLs of $ 8,289 ($ 39,468
 of gross NOLs), of which $ 4,063
 has been subject to a valuation allowance. The NOLs originated in 2006 through 2017 will expire over 20 years. The NOLs originated
in 2018 and later years will not expire. As of December 31, 2024, the Company has a deferred tax asset related to state NOLs of $ 2,486
( $ 49,710
 of gross NOLs), all of which has been subject to a valuation allowance. The state NOLs expire in various years through 2037.

 The statutes of limitations
with respect to the Company's taxes for 2021 and more recent years remain open to examinations by tax authorities, subject to possible
utilization of loss carryforwards from earlier years. Notwithstanding the foregoing, all NOLs generated and not yet utilized are subject
to adjustment by the Internal Revenue Service ("IRS"). The Company believes adequate provisions for income tax have been
recorded for all years, although there can be no assurance that such provisions will be adequate. To the extent that there is a shortfall,
any such shortfall for which the Company is liable, the Company's results of operations may be affected adversely and materially.

 (5) Transactions
with Affiliates

 An affiliated insurance
agency, JMB Insurance Agency, Inc., which has some degree of common ownership with the Company, earns insurance brokerage commissions
in connection with providing the placement of insurance coverage for certain of the properties and operations of the Company. The total
of such commissions for the years ended December 31, 2024 and 2023 was approximately $ 50
 and $51, respectively.

 The Company reimburses
affiliates of Pacific Trail Holdings, LLC, the owner of approximately 76.4% of the Company's Common Shares, for general
overhead expense and for direct expenses incurred on its behalf, including salaries and salary-related expenses incurred in
connection with the management of the Company's operations. Generally, the entity that employs the person providing the services
receives the reimbursement. Substantially all of such reimbursable amounts were incurred by JMB Realty Corporation or its
affiliates, 900FMS, LLC, 900Work, LLC, and JMB Financial Advisors, LLC, all of which have some degree of common ownership with the
Company. The total costs recorded in cost of sales and selling, general and administrative expenses in the consolidated statement of
operations for the years ended 2024 and 2023 were $ 1,339 and $1,158, respectively,
all of which was paid as of December 31, 2024.

 The Company maintains a suspense
account within the QRP pending allocation to the employees of certain affiliates, all of which have some degree of common ownership with
the Company and were concluded as eligible participants per ERISA requirements for QRPs. The total allocation of $ 837, which occurred
during the first quarter of 2024, was recorded as a reduction in accumulated earnings in the consolidated balance sheet as of December
31, 2024. Reference is made to Note 3 for discussion regarding the QRP.

 (6) Commitments
and Contingencies

 Material legal proceedings
of the Company are described below. Unless otherwise noted, the parties adverse to the Company in the legal proceedings described below
have not made a claim for damages in a liquidated amount and/or the Company believes that it would be speculative to attempt to determine
the Company's exposure relative thereto, and as a consequence believes that an estimate of the range of potential loss cannot be made.

 A subsidiary of the Company,
D/C Distribution Corporation ("D/C") was substantially without assets and was unable to obtain additional sources of capital
to satisfy its liabilities, and therefore filed with the United States Bankruptcy Court, Northern District of Illinois, its voluntary
petition for liquidation under Chapter 7 of Title 11, United States Bankruptcy Code in July 2007, Case No. 07-12776. At the time of the
filing of the bankruptcy petition, Kaanapali Land, as successor by merger to other entities, and D/C had been named as defendants in
personal injury actions allegedly based on exposure to asbestos. While there were relatively few cases that name Kaanapali Land, there
were a substantial number of cases that were pending against D/C on the U.S. mainland (primarily in California). Cases against Kaanapali
Land (hereafter, "Kaanapali Land asbestos cases") were allegedly based on its prior business operations in Hawaii and cases
against D/C were allegedly based on sale of asbestos-containing products by D/C's prior distribution business operations primarily
in California. Such filing was not expected to have a material adverse effect on the Company as D/C was substantially without assets
at the time of the filing. Kaanapali Land filed claims in the D/C bankruptcy that aggregated approximately $ 26,800,
relating to both secured and unsecured intercompany debts owed by D/C to Kaanapali Land.

 On January 21, 2020, certain asbestos
claimants filed a Stay Relief Motion in the Bankruptcy Court for the Northern District of Illinois, Eastern Division, Case No. 07-12776
("motion to lift stay") in connection with the D/C proceeding. The motion sought the entry of an order, among other things,
modifying an automatic stay in the D/C bankruptcy to permit those claimants to prosecute various lawsuits in state courts against D/C
and to recover on any judgment or settlement solely from any available insurance coverage. Various oppositions to the motion to lift stay
were filed, and the matter was heard and taken under advisement in April 2020. On July 21, 2020, the bankruptcy court issued an order
granting the motion to lift stay to permit the movants to pursue their claims and to recover any judgment or settlement from and to the
extent of any available insurance coverage of D/C only.

 Thereafter, certain
asbestos-related proofs claims in the bankruptcy case were withdrawn in connection with the closing of the bankruptcy case. A court
hearing was held on March 29, 2023 in which the court awarded the trustee's compensation and expenses and therefore D/C no
longer has any assets. On June 6, 2023, the bankruptcy trustee filed a final account and application to close the D/C bankruptcy and
on June 14, 2023, the D/C bankruptcy court closed the case and the trustee was discharged. Due to the closing of the case, the
Company derecognized a related contingent liability. The derecognition of the contingent liability is included as a reduction of
Selling, general and administrative expenses and resulted in a credit in expenses on the Company's consolidated statement of
operations for the year ended December 31, 2023. However, personal injury claimants have asserted, and may in the future assert,
asbestos-related claims against D/C.

 The Company has received
notice from Hawaii's Department of Land and Natural Resources ("DLNR") that DLNR on a periodic basis would inspect all
significant dams and reservoirs in Hawaii, including those maintained by the Company on Maui in connection with its agricultural operations.
A series of such inspections have taken place over the period from 2006 through the most recent inspections that occurred in July 2024.
To date, the DLNR cited certain deficiencies concerning two of the Company's reservoirs relating to dam and reservoir safety standards
established by the State of Hawaii. These deficiencies include, among other things, vegetative overgrowth, erosion of slopes, uncertainty
of inflow control, spillway capacity, and freeboard, and uncertainty of structural stability under certain loading and seismic conditions.
The Company has taken certain corrective actions, including lowering the reservoir operating level; as well as updating plans to address
emergency events and basic operations and maintenance. In 2018, the Company contracted with an engineering firm to develop plans to address

 certain DLNR cited deficiencies on one of the Company's reservoirs. Remediation plans for addressing all deficiencies have been
submitted to DLNR. In 2012, the State of Hawaii issued new Hawaii Administrative Rules for Dams and Reservoirs which require dam owners
to obtain from DLNR Certificates of Impoundment ("permits") to operate and maintain dams or reservoirs. Obtaining such permits
requires owners to completely resolve all cited deficiencies. Therefore, the process may involve further analysis of dam and reservoir
safety requirements, which will involve continuing engagement with specialized engineering consultants, and ultimately could result in
significant and costly improvements which may be material to the Company.

 The DLNR categorizes the
reservoirs as "high hazard" under State of Hawaii Administrative Rules and State Statutes concerning dam and reservoir safety.
This classification, which bears upon government oversight and reporting requirements, may materially increase the cost of managing and
maintaining these reservoirs. The Company does not believe that this classification is warranted for either of the reservoirs and has
initiated a dialogue with DLNR in that regard. In April 2008, the Company received further correspondence from DLNR that included the
assessment by their consultants of the potential losses that result from the failure of these reservoirs. In April 2009, the Company filed
a written response to DLNR to correct certain factual errors in its report and to request further analysis on whether such "high
hazard" classifications are warranted. It is unlikely that the "high hazard" designation will be changed.

 On August 5, 2024, NHC served
KLMC with a Demand for Arbitration administrated by Dispute Prevention and Resolution, Inc. ("DPR"), relating to the Infrastructure
Improvement Agreement and NHC's development of the site. NHC alleges, among other things, that KLMC wrongfully caused significant
delays, increased costs and related damages to NHC with respect to NHC's planning and construction of the infrastructure improvements
required of NHC under the Infrastructure Improvement Agreement (as subsequently amended). NHC seeks judgment for declaratory relief that
the Infrastructure Improvement Agreement between NHC and KLMC is void; in the alternative, for reformation of the Infrastructure Improvement
Agreement; for award of damages in an amount to be proven at arbitration; for attorneys' fees and costs; for prejudgment and post-judgment
interest on any monetary award; and for such other and further relief as the arbitrator deems appropriate. On October 25, 2024, KLMC filed
an Answering Statement to NHC's Demand for Arbitration and KLMC's counterclaim against NHC. On November 5, 2024, DPR confirmed
the assignment of a mutually agreed upon arbitrator. The arbitration hearing is expected to begin in August 2025. The pre-arbitration discovery process is ongoing. KLMC will continue to vigorously defend. However, there can be no assurance that
the eventual outcome of the arbitration will not result in any material liability or have a material impact on business and financial
results for KLMC.

 Other than as described above,
the Company is not involved in any material pending legal proceedings, other than ordinary routine litigation incidental to its business.
The Company and/or certain of its affiliates have been named as defendants in several pending lawsuits. While it is impossible to predict
the outcome of such routine litigation that is now pending (or threatened) and for which the potential liability is not covered by insurance,
the Company is of the opinion that the ultimate liability from any of this litigation will not materially adversely affect the Company's
consolidated results of operations or its financial condition.

 The Company often seeks
insurance recoveries under its policies for costs incurred or expected to be incurred for losses or claims under which the policies
might apply. During third quarter 2023, the Company received $ 538
in insurance proceeds related to an insured event that occurred during the 2022 crop year. This amount has been recorded within crop
insurance proceeds in the Company's consolidated financial statements. Additionally, as a result of the Lahaina wildfire, the
Company received an initial, unallocated advance payment of $ 1,000
from its insurance carrier. In June 2024, the Company received an insurance payment of $ 4,882
and in August 2024, received $ 1,088,
both of which are recorded within net gain on property damage and lost profits, net of insurance claims in the
Company's consolidated financial statements. Reference is made to Note 1, Property, for further discussion regarding the
Lahaina wildfire.

 Kaanapali Land Management Corp.
("KLMC") is a party to an agreement with the State of Hawaii for the development of the Lahaina Bypass Highway. Approximately
2.4 miles of this two lane state highway have been completed. Construction to extend the southern terminus was completed mid-2018. The
northern portion of the Bypass Highway, which extends to KLMC's lands, is in the early stage of planning. Under certain circumstances,
which have not yet occurred, KLMC remains committed for approximately $ 1,100 of various future costs relating to the planning and design
of the uncompleted portion of the Bypass Highway. Under certain conditions, which have not yet been met, KLMC has agreed to contribute
an amount not exceeding $ 6,700 toward construction costs. Any such amount contributed would be reduced by the value of KLMC's land
actually contributed to the State for the Bypass Highway.

 These potential commitments have
not been reflected in the consolidated financial statements. While the completion of the Bypass Highway would add value to KLMC's
lands north of the town of Lahaina, there can be no assurance that it will be completed or when any future phases will be undertaken.

 (7) Business
Segment Information

 The Company's reportable
segments are components of the Company that engage in certain business activities. The Company measures and evaluates operating segments
based on revenues and operating income (loss). The internal reporting of these operating segments is based, in part, on the reporting
and review process used in the evaluation of operating income (loss). The internal reporting is used for such review process by the Company's
chief operating decision maker ("CODM"), its President. The CODM primarily uses operating income (loss), a measure that is
determined in accordance with U.S. GAAP, to evaluate segment income (loss) when making decisions about allocating resources to the segments.

 As described in Note 1, the Company
has two reportable business segments, Property and Agriculture. The Company's Property segment consists primarily of revenue received
from land sales and development, and lease and licensing agreements. The Company's Agricultural segment currently consists primarily
of coffee farming and milling operations and sales of coffee, other farm related operations, and revenue derived from licensing agreements.

 The Corporate amounts include interest earned on the Company's investments
and costs that are not allocated to segments including direct expenses and general overhead expenses reimbursed to Pacific Trail, certain
professional fees, insurance expenses and other expenses.

 Net gain on property damage and
lost profits, net of insurance claims is a result of the Company's losses caused by the destruction of the Lahaina wildfires.

 The Company has determined its
significant segment expense categories based on amounts used, in part, by the Company's CODM when making decisions about allocating
resources to the segments.

 Reportable segment revenues and significant reportable
segment expense categories and amounts included in the Company's measure of operating profit (loss) by business segment are presented
in the tables below.

 2024

 2023

 Revenue

 $

 $

 Less:

 Operating
 costs and expenses

 1,022

 1,126

 Credit
 loss reserve expense

 --

 Depreciation

 Other
 selling, general, and administrative expenses

 1,045

 Property operating loss
 before income taxes

 ( 2,932)

 ( 1,625)

 Revenue

 3,178

 Less:

 Cost
 of goods sold

 2,593

 2,869

 tax

 Other
 selling, general, and administrative expenses

 Depreciation

 Agriculture operating
 loss before income taxes

 ( 2,700)

 ( 55)

 Operating loss

 ( 5,632)

 ( 1,680)

 Net
 gain on property damage and lost profits, net of insurance claims

 6,243

 Corporate operating income (loss) before income
 taxes

 ( 1,912)

 1,730

 Income (loss) before income taxes

 $

 ( 1,301)

 $

 Identifiable assets by business
segment are those assets that are used in the Company's operations in each segment. Agricultural identified assets include land
classified as agricultural or conservation for State and County purposes. Corporate assets consist principally of cash and cash equivalents
and receivables related to previously divested businesses.

 Identifiable assets, capital
expenditures, and depreciation and amortization by business segment are presented in the tables below.

 2024

 2023

 Identifiable Assets:

 $

 12,220

 $

 10,468

 58,299

 53,298

 70,519

 63,766

 Corporate

 20,448

 29,253

 $

 90,967

 $

 93,019

 Capital Expenditures:

 $

 1,016

 $

 1,619

 1,981

 $

 2,997

 $

 1,823

 Depreciation and Amortization:

 $

 $

 $

 $

 (8) Calculation
of Net Income Per Share

 The
following tables set forth the computation of net income (loss) per share - basic and diluted:

 Year Ended

 December 31,

 2024

 Year Ended

 December 31,

 2023

 (Amounts in thousands except

 per share amounts)

 Numerator:

 Net income (loss)

 $

 $

 3,707

 Denominator:

 Number of weighted average shares –

 basic and diluted

 1,845

 1,845

 Net income (loss) per share – basic
and diluted

 $

 ( 0.59)

 $

 2.01

 As of December 31, 2024,
the Company had issued and outstanding 1,792,613 Common Shares and 52,000 Class C Shares. The Class C Shares have the same rights
as the Common Shares except that the Class C Shares will not participate in any distributions until the holders of the Common Shares
have received aggregate distributions equal to $19 per share, subject to customary antidilution adjustments. Net income per share data
is based on the aggregate 1,844,613 outstanding shares.

 (9) Subsequent Events

 In February 2025, approximately
 $ 1,098 was allocated to the participants in the qualified replacement plan.

 Item 9. Changes in and Disagreements with
Accountants on Accounting and Financial Disclosure

 None.

 Item 9A. Controls and Procedures

 Disclosure Controls and Procedures

 The principal executive officer
and the principal financial officer of the Company have evaluated the effectiveness of the Company's disclosure controls and procedures
as defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended, (the "Exchange Act") as of the end of
the period covered by this report. Based on such evaluation, the principal executive officer and the principal financial officer have
concluded that the Company's disclosure controls and procedures were effective to ensure that information required to be disclosed
was recorded, processed, summarized and reported within the time periods specified in the applicable rules and form of the Security and
Exchange Commission ("SEC").

 Management's Report on Internal Control
Over Financial Reporting

 The Company's management
is responsible for establishing and maintaining adequate internal control over financial reporting as such term is defined in Rule 13a-15(f)
under the Exchange Act. Under the supervision and with the participation of management including the principal executive officer and the
principal financial officer management conducted an evaluation of the effectiveness of internal control over financial reporting based
on the framework in Internal Control - Integrated Framework (2013 Framework) issued by the Committee of Sponsoring Organizations of the
Treadway Commission.

 Because of its inherent limitations,
internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective
can only provide reasonable assurances with respect to financial statement preparation and presentation.

 Based on the Company's
evaluation under the framework in Internal Control – Integrated Framework (2013 Framework), management concluded that its internal
control over financial reporting was effective as of December 31, 2024.

 Changes in Internal Control Over
Financial Reporting

 There have not been any changes
in the Company's internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange
Act) that occurred during the fourth quarter of 2024 that have materially affected, or are reasonably likely to materially affect, the
Company's internal control over financial reporting.

 Item 9B. Other Information

 Not applicable.

 Item 9C. Disclosure Regarding Foreign Jurisdictions
that Prevent Inspections

 None

 Item 10. Directors, Executive Officers and
Corporate Governance

 The sole managing member
of Kaanapali Land, LLC is Pacific Trail, which is also Kaanapali Land's largest shareholder. Pacific Trail manages the business of Kaanapali
Land pursuant to the terms of the Company's Amended and Restated Limited Liability Agreement ("LLC Agreement"). Although
the executive officers of Kaanapali Land are empowered to manage its day-to-day business affairs, under the Company's LLC Agreement,
most significant actions of Kaanapali Land outside the ordinary course of business must first be authorized by Pacific Trail, which is
responsible and has full power and authority to do all things deemed necessary and desirable by it to conduct the business of Kaanapali
Land. Pacific Trail may be removed as manager in certain specified circumstances. As of December 31, 2024, the executive officers
and certain other officers of the Company were as follows:

 Name

 Position Held with the Company

 President, Chief Executive Officer and Chief Financial Officer

 Richard Helland

 Vice President and Principal Accounting Officer

 Certain of these officers
are also officers and/or directors of JMB Realty Corporation ("JMB") and numerous affiliated companies of JMB (hereinafter collectively
referred to as "JMB affiliates"). JMB affiliates outside of the Company have not materially engaged in the agriculture business
and have primarily purchased, or made mortgage loans securing, existing commercial, retail, office, industrial and multi-family residential
rental buildings or have owned or operated hotels on various other hospitality businesses. However, certain partnerships sponsored by
JMB and other affiliates of JMB were previously engaged in land development activities including planned communities, none of which are
in Hawaii.

 The following sets forth
certain business experience during the past five years of such officers of the Company.

 Stephen Lovelette (age 68)
has been the President of KLC Land and Kaanapali Land since March 2019. Since March 2019, Mr. Lovelette has been Chief Executive Officer
of Kaanapali Land and since June 2018, Mr. Lovelette has been Chief Financial Officer of Kaanapali Land. Mr. Lovelette is in charge of
implementing the Kaanapali 2020 Development Plan. Mr. Lovelette has been associated with JMB and its affiliates for over 30 years. Mr.
Lovelette holds a bachelor's degree from The College of the Holy Cross and an MBA from Seton Hall University. In addition, Mr. Lovelette
has extensive experience in corporate finance and has been responsible for obtaining substantial financial commitments from institutional
lenders relating to the assets of JMB and its affiliates. During the past five years, Mr. Lovelette has also been a Managing Director
of JMB.

 It is currently
anticipated that Stephen Lovelette will continue to devote approximately 25 to 50 percent of his time to the operations of the
Company. The percentage is largely dependent upon potential land sale transactions, the entitlement processes relating to various
land parcels and other matters (including attention devoted to litigation, overhead, staffing and operations).

 Richard Helland (age 68)
has been a Vice President of the Company since July 2004. Mr. Helland has been Principal Accounting Officer since June 2018. He holds
a bachelor's degree from Illinois State University and is a Certified Public Accountant. Mr. Helland has substantial experience
in the management and reporting functions of both public and private entities.

 In light of the fact that the Company's shares are not publicly traded,
the Company is a limited liability company and the rights of members are governed by the Company's LLC Agreement, the Company has
determined that it is not necessary to have a separately designated audit committee, compensation committee, an audit committee financial
expert, or a code of ethics that applies to its principal executive, financial or accounting officers as those terms are defined in the
rules and regulations of the SEC or an insider trading policy governing the purchase, sale and/or other dispositions of the Company's
shares.

 Item 11. Executive Compensation

 Certain officers of the Company
listed in Item 10 above are officers of JMB and are compensated by JMB or an affiliate thereof (other than the Company and its
subsidiaries). The Company will reimburse JMB, Pacific Trail and their affiliates for any expenses incurred while providing services to
the Company.

 Summary Compensation Table

 Name (1)

 Principal Position

 Year

 Salary

 ($) (2)

 All Other

 Compensation

 ($)

 Total

 ($)

 President, Chief Executive

 Officer and Chief Financial

 Officer

 2024

 445,278

 --

 445,278

 2023

 337,778

 --

 337,778

 (1) Mr.
Lovelette is the Company's only executive officer.

 (2) Salary
amounts for Mr. Lovelette represents the portion of total compensation allocated and charged to the Company. The Company does not have
a compensation committee as compensation is determined by the Company's manager. Executive officer compensation was determined through
deliberations with Pacific Trail representatives.

 The Company does not have
a specific policy or practice on the timing of awards of stock options, stock appreciation rights, or similar option-like instruments
in relation to the disclosure of material nonpublic information by the Company, as the Company does not currently grant such awards.

 Item 12. Security Ownership of
Certain Beneficial Owners and Management and Related
Stockholder Matters

 The
following sets forth, as of March 24, 2025, the beneficial ownership of the Company's Common Shares and Class C Shares by the Company's
named executive officer and each shareholder known to us to be the beneficial owner of more than 5% of the Company's outstanding
Common Shares and Class C Shares. The percentage of beneficial ownership is based on the number of Common Shares and Class C Shares set
forth on the cover page of this report.

 Title
 of Class

 Name and Address

 of Beneficial Owner

 Amount and Nature

 of Beneficial Ownership

 Percent

 of Class

 Common Shares

 Pacific Trail Holdings, LLC

 900 North Michigan Avenue

 Chicago, IL 60611

 1,369,295 Common Shares

 owned directly (1) (2)

 76.4%

 Common Shares

 900 North Michigan Avenue

 Chicago, IL 60611

 96,480 Common Shares

 owned directly (2)

 5.4%

 Class C Shares

 900 North Michigan Avenue

 Chicago, IL 60611

 52,000 Class C Shares

 owned directly (2)

 100.0%

 (1)

 The sole managing member of Pacific Trail, Pacific Trail Holdings, Inc. ("PTHI"), may be deemed to beneficially own the Common Shares owned by Pacific Trail. PTHI disclaims beneficial ownership with respect to any of the shares owned by Pacific Trail. Each of the shareholders of PTHI may be deemed to own the Common Shares owned by Pacific Trail. Each of such shareholders, being Gary Nickele, Gailen J. Hull and Stephen A. Lovelette, disclaims beneficial ownership with respect to any of the shares owned by Pacific Trail. The addresses of PTHI and Messrs. Nickele, Hull and Lovelette are the same as for Pacific Trail.

 (2)

 As of March 24, 2025, there were approximately
 1,792,613 Common Shares and 52,000 Class C Shares issued and outstanding.

 No other person including any officer of the
Company is known by the Company to beneficially own in excess of 5% of the Common Shares issued, outstanding and distributed.

 Item 13. Certain Relationships and Related
Transactions, and Director Independence

 An affiliated insurance agency,
JMB Insurance Agency, Inc., which has some degree of common ownership with the Company, earns insurance brokerage commissions in connection
with providing the placement of insurance coverage for certain of the properties and operations of the Company. The total of such commissions
for the year ended December 31, 2024 was approximately $50 thousand, all of which was paid as of December 31, 2024.

 The Company reimburses Pacific
Trail and its affiliates for general overhead expense and for direct expenses incurred on its behalf, including salaries and salary-related
expenses incurred in connection with the management of the Company's operations. Generally, the entity that employs the person providing
the services receives the reimbursement. Substantially all of such reimbursable amounts were incurred by JMB Realty Corporation or its
affiliates, 900FMS, LLC, 900Work, LLC, and JMB Financial Advisors, LLC, all of which have some degree of common ownership with the Company.
The total costs for the year ended December 31, 2024 was approximately $1.3 million, all of which was paid as of December 31, 2024.

 The Company maintains a suspense account within the QRP pending allocation
to the employees of certain affiliates, all of which have some degree of common ownership with the Company and were concluded as eligible
participants per ERISA requirements for QRPs. The total allocation for the year ended December 31, 2024 was approximately $0.8 million.

 In light of the fact that the Company's
shares are not publicly traded, is a limited liability company, and has no independent outside directors or managers, it has no formal
policy or procedure for the review, approval or ratification of related party transactions that are required to be disclosed pursuant
to Item 404 of Regulation S-K.

 Item 14. Principal Accountant Fees and Services

 In March 2015, the
managing member of the Company approved the engagement of Grant Thornton, LLP ("Grant Thornton") as the Company's independent
registered public accounting firm. The fees billed by Grant Thornton for services performed for each of the years ended
December 31, 2024 and 2023 are as follows:

 (1) Audit
Fees

 The fees incurred for
the years ended December 31, 2024 and 2023 professional services for the audit of the Company's consolidated financial statements
were approximately $255 thousand and $258 thousand, respectively.

 (2) Audit
Related Fees

 None

 (3) Tax
Fees

 The fees incurred for
the years ended December 31, 2023 for professional tax compliance services related to the Pension Plan's IRS Form 5500 Annual Report
was approximately $9 thousand.

 (4) All
Other Fees

 None.

 All audit and permitted non-audit
services proposed to be performed by the Company's independent registered public accounting firm are approved by the managing member
of the Company before the service is undertaken.

 Item 15.
Exhibits and Financial Statement Schedules

 (a)

 Exhibits.

 2.1

 Order
 Confirming Second Amendment Joint Plan of Reorganization Dated June 1, 2002, including as an exhibit thereto, the Second Amended
 Joint Plan of Reorganization of Amfac Hawaii, LLC, Certain of its Subsidiaries and FHT Corporation Under Chapter 11 of the Bankruptcy
 Code incorporated herein by reference the Amfac Hawaii, LLC Current Report on Form 8-K for July 29, 2002 dated August 13, 2002 (File
 No. 33-24180).

 2.2

 Second
 Amended Disclosure Statement with Respect to Joint Plan of Reorganization of Amfac Hawaii, LLC, Certain of its Subsidiaries and FHT
 Corporation Under Chapter 11 of the Bankruptcy Code, incorporated herein by reference from the Amfac Hawaii, LLC Current Report
 on Form 8-K for July 29, 2002 dated August 13, 2002 (File No. 33-24180).

 3.1

 Amended
 and Restated Limited Liability Company Agreement of Kaanapali Land, LLC dated November 14, 2002 filed as an exhibit to the Company's
 Form 10 filed May 1, 2003 and hereby incorporated by reference.

 3.2

 Consent
 Decree entered into as of April 16, 2021, for the United States of America by U.S. Department of Justice and U.S. Environmental
 Protection Agency and by Kaanapali Land, LLC and Oahu Sugar Company, LLC filed as an exhibit to the Company's report on Form 8-K
 filed April 22, 2021, and hereby incorporated by reference.

 4.1

 Description
 of the Registrant's Common Shares is filed herewith.

 10.1

 Service
 Agreement, dated November 18, 1988, between Amfac/JMB Hawaii, Inc., and Amfac Property Development Corp.; Amfac Property Investment
 Corp.; Amfac Sugar and Agribusiness, Inc.; Kaanapali Water Corporation; Amfac Agribusiness, Inc.; Kekaha Sugar Company, Limited;
 The Lihue Plantation Company; Oahu Sugar Company, Limited; Pioneer Mill Company, Limited; Puna Sugar Company, Limited; H. Hackfeld
 & Co., Ltd.; and Waiahole Irrigation Company, Limited and JMB Realty Corporation, incorporated herein by reference to the Amfac
 Hawaii, LLC Annual Report on Form 10-K filed on March 22, 1989 (File No. 33-24180) for the year ended December 31, 1988.

 10.2*

 Property Purchase Agreement between Kaanapali Land Management Corp. and Kauhale Development LLC dated June 3, 2024, filed as Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q filed August 13, 2024, and hereby incorporated by reference.

 10.3*

 Property Purchase Agreement between Pioneer Mill Company, LLC and Pioneer Mill Site LLC dated June 13, 2024, filed as Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q filed August 13, 2024, and hereby incorporated by reference.

 10.4

 Amendment to Property Purchase Agreement between Pioneer Mill Company, LLC and Pioneer Mill Site LLC, dated August 12, 2024, filed as Exhibit 10.3 to the Company's Quarterly Report on Form 10-Q filed November 12, 2024, and hereby incorporated by reference.

 List
 of Subsidiaries is filed herewith.

 Certification
 of Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14(a) is filed herewith.

 Certifications
 pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 furnished herewith.

 101.SCH

 Inline

 101.CAL

 Inline

 101.LAB

 Inline

 101.DEF

 Inline

 101.PRE

 (1)

 Previously filed as exhibits to Amfac Hawaii, LLC's Registration Statement on Form S-1 (as amended) under the Securities Act of 1933 (File No. 33-24180) and hereby incorporated by reference.

 * Certain exhibits and schedules
to this exhibit have been omitted in accordance with Item 601(a)(5) of Regulation S-K. Kaanapali Land, LLC agrees to furnish to the U.S.
Securities and Exchange Commission or its staff, upon request, a copy of any omitted exhibits and schedules.

 Item 16. Form 10-K Summary

 None.

 Signatures

 Pursuant to the requirements
of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

 By:

 Pacific Trail Holdings, LLC

 (Sole Managing Member)

 /s/ Richard Helland

 By:

 Richard Helland

 Vice President

 Date:

 March 24, 2025

 Pursuant to the requirements
of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in
the capacities and on the dates indicated.

 /s/ Richard Helland

 By:

 Richard Helland

 Vice President and Principal Accounting Officer

 Date:

 March 24, 2025

 /s/ Stephen A. Lovelette

 By:

 President, Chief Executive Officer and

 Chief Financial Officer

 Date:

 March 24, 2025