☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 36-7730868 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employment Identification No.) |
Suite | ||
(Address of principal executive offices) | (Zip Code) |
Securities registered pursuant to Section 12(b) of the Act: None |
Large accelerated filer ☐ | Accelerated filer ☐ | |
Non-accelerated filer ☐ | Smaller reporting company ☒ | |
Emerging growth company ☒ |
PART I. FINANCIAL INFORMATION | |||||
Item 1. | |||||
Item 2. | |||||
Item 3. | |||||
Item 4. | |||||
PART II. OTHER INFORMATION | |||||
Item 1. | |||||
Item 1A. | |||||
Item 2. | |||||
Item 3. | |||||
Item 4. | |||||
Item 5. | |||||
Item 6. |
PART I. | FINANCIAL INFORMATION |
Item 1. | Financial Statements |
Consolidated Statements of Net Assets in Liquidation As of 2021 |
(Unaudited, $ |
12/31/2019 | 6/30/2019 | |||||||
Assets | ||||||||
Real estate assets held for sale, net (Note 3): | ||||||||
Single family homes under development | $ | 234,690 | $ | 265,340 | ||||
Real estate assets available for sale | 137,806 | 216,336 | ||||||
Subtotal | 372,496 | 481,676 | ||||||
Cash | 98,830 | 34,998 | ||||||
Restricted cash (Note 4) | 2,971 | 3,364 | ||||||
Other assets (Note 5) | 3,596 | 2,436 | ||||||
Total assets | $ | 477,893 | $ | 522,474 | ||||
Liabilities | ||||||||
Accounts payable and accrued liabilities | $ | 297 | $ | 441 | ||||
Distributions payable | 1,738 | 1,814 | ||||||
Accrued liquidation costs (Note 6) | 141,275 | 190,248 | ||||||
Total liabilities | $ | 143,310 | $ | 192,503 | ||||
Commitments and Contingencies (Note 12) | ||||||||
Net Assets in Liquidation | $ | 334,583 | $ | 329,971 |
9/30/2021 | 6/30/2021 | |||||||
Assets | ||||||||
Real estate assets held for sale, net (Note 3) | ||||||||
Single-family homes | $ | 98,465 | $ | 137,945 | ||||
Other real estate assets | 2,901 | 2,910 | ||||||
Subtotal | 101,366 | 140,855 | ||||||
Cash and cash equivalents | 80,271 | 45,369 | ||||||
Restricted cash (Note 4) | 8,117 | 8,273 | ||||||
Other assets (Note 5) | 5,596 | 5,473 | ||||||
Total assets | $ | 195,350 | $ | 199,970 | ||||
Liabilities | ||||||||
Accounts payable and accrued liabilities | $ | 209 | $ | 160 | ||||
Distributions payable | 4,550 | 4,687 | ||||||
Accrued liquidation costs (Note 6) | 56,048 | 65,583 | ||||||
Total liabilities | $ | 60,807 | $ | 70,430 | ||||
Commitments and contingencies (Note 14) | 0 | 0 | ||||||
Net Assets in Liquidation | ||||||||
Restricted for Qualifying Victims (Note 7) | $ | 3,167 | $ | 3,167 | ||||
All Interestholders | 131,376 | 126,373 | ||||||
Total net assets in liquidation | $ | 134,543 | $ | 129,540 |
Woodbridge Liquidation Trust and Subsidiaries For the Three Months Ended September 30, 2021 and 2020 |
(Unaudited, $ in Thousands) |
Three Months Ended September 30, 2021 | Three Months Ended September 30, 2020 | |||||||||||||||||||||||
Restricted For Qualifying Victims | All Interestholders | Total | Restricted For Qualifying Victims | All Interestholders | Total | |||||||||||||||||||
Net Assets in Liquidation as of beginning of period | $ | 3,167 | $ | 126,373 | $ | 129,540 | $ | 0 | $ | 264,517 | $ | 264,517 | ||||||||||||
Change in assets and liabilities (Note 8): | ||||||||||||||||||||||||
Restricted for Qualifying Victims - | ||||||||||||||||||||||||
Change in carrying value of assets and liabilities, net | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||
All Interestholders: | ||||||||||||||||||||||||
Change in carrying value of assets and liabilities, net | 0 | 4,904 | 4,904 | 0 | 5,083 | 5,083 | ||||||||||||||||||
Distributions (declared) reversed, net | 0 | 99 | 99 | 0 | (29,877 | ) | (29,877 | ) | ||||||||||||||||
Net change in assets and liabilities | 0 | 5,003 | 5,003 | 0 | (24,794 | ) | (24,794 | ) | ||||||||||||||||
Net Assets in Liquidation as of end of period | $ | 3,167 | $ | 131,376 | $ | 134,543 | $ | 0 | $ | 239,723 | $ | 239,723 |
Item 1. | Financial Statements (Continued) |
Three Months Ended December 31, 2019 | Six Months Ended December 31, 2019 | |||||||
Net Assets in Liquidation as of beginning of period | $ | 333,582 | $ | 329,971 | ||||
Change in assets and liabilities (Note 7): | ||||||||
Change in carrying value of assets and liabilities, net | 960 | 4,535 | ||||||
Distributions reversed | 41 | 77 | ||||||
Net change in assets and liabilities | 1,001 | 4,612 | ||||||
Net Assets in Liquidation as of December 31, 2019 | $ | 334,583 | $ | 334,583 |
Formation and Description of Business |
Item 1. | Financial Statements (Continued) |
(Unaudited) |
2) | Summary of Significant Accounting Policies |
Item 1. | Financial Statements (Continued) |
Item 1. | Financial Statements (Continued) |
(Unaudited) |
Item 1. | Financial Statements (Continued) |
(Unaudited) |
3) | Real Estate Assets Held for Sale |
September 30, 2021 | June 30, 2021 | |||||||||||||||||||||||||||||||
Number of Assets | Gross Value | Closing and Other Costs | Net Value | Number of Assets | Gross Value | Closing and Other Costs | Net Value | |||||||||||||||||||||||||
Single-family homes | 5 | $ | 104,750 | $ | (6,285 | ) | $ | 98,465 | 7 | $ | 146,750 | $ | (8,805 | ) | $ | 137,945 | ||||||||||||||||
Other real estate assets: | ||||||||||||||||||||||||||||||||
Secured loans | 4 | 1,936 | (87 | ) | 1,849 | 4 | 1,945 | (87 | ) | 1,858 | ||||||||||||||||||||||
Other properties | 2 | 1,107 | (55 | ) | 1,052 | 2 | 1,107 | (55 | ) | 1,052 | ||||||||||||||||||||||
Subtotal | 6 | 3,043 | (142 | ) | 2,901 | 6 | 3,052 | (142 | ) | 2,910 | ||||||||||||||||||||||
Total | 11 | $ | 107,793 | $ | (6,427 | ) | $ | 101,366 | 13 | $ | 149,802 | $ | (8,947 | ) | $ | 140,855 |
December 31, 2019 | June 30, 2019 | |||||||||||||||||||||||
Number of Assets | Gross Value | Closing and Other Costs | Net Value | Number of Assets | Net Value | |||||||||||||||||||
Single-family homes under development | 12 | $ | 249,500 | $ | (14,810 | ) | $ | 234,690 | 14 | $ | 265,340 | |||||||||||||
Real estate assets available for sale: | ||||||||||||||||||||||||
Single-family homes | 5 | 133,500 | (7,300 | ) | 126,200 | 11 | 182,878 | |||||||||||||||||
Lots | 19 | 4,410 | (332 | ) | 4,078 | 35 | 15,658 | |||||||||||||||||
Secured loans | 18 | 4,184 | (209 | ) | 3,975 | 20 | 5,302 | |||||||||||||||||
Other properties | 13 | 3,740 | (187 | ) | 3,553 | 15 | 12,498 | |||||||||||||||||
Subtotal | 55 | 145,834 | (8,028 | ) | 137,806 | 81 | 216,336 | |||||||||||||||||
Total | 67 | $ | 395,334 | $ | (22,838 | ) | $ | 372,496 | 95 | $ | 481,676 |
Item 1. | Financial Statements (Continued) |
4) | Restricted Cash |
September 30, 2021 | June 30, 2021 | |||||||
Distributions restricted by the Company related to unresolved claims, distributions for recently allowed claims, uncashed distribution checks, distributions withheld due to pending avoidance actions and distributions that the Trust is waiting for further beneficiary information | $ | 4,550 | $ | 4,687 | ||||
Forfeited Assets (Note 7) | 1,817 | 1,836 | ||||||
Interest reserve (Note 9) | 1,750 | 1,750 | ||||||
Total restricted cash | $ | 8,117 | $ | 8,273 |
December 31, 2019 | June 30, 2019 | |||||||
Distributions related to unresolved claims and uncashed distribution checks, restricted by the Company | $ | 1,734 | $ | 1,810 | ||||
Fair Funds, legally restricted for distribution | 1,237 | 1,237 | ||||||
Other | - | 317 | ||||||
Total restricted cash | $ | 2,971 | $ | 3,364 |
5) | Other Assets |
September 30, 2021 | June 30, 2021 | |||||||
Escrow receivables (a) | $ | 2,607 | $ | 2,500 | ||||
Forfeited Assets (Note 7) | 1,549 | 1,549 | ||||||
Settlement installment receivables, net (b) | 1,021 | 1,014 | ||||||
Other | 419 | 410 | ||||||
Total other assets | $ | 5,596 | $ | 5,473 |
Item 1. | Financial Statements (Continued) |
(Unaudited) |
December 31, 2019 | June 30, 2019 | |||||||
Insurance claim receivable | $ | 1,900 | $ | 1,900 | ||||
Settlement installments receivable | 988 | 518 | ||||||
Other | 708 | 18 | ||||||
Total other assets | $ | 3,596 | $ | 2,436 |
6) | Accrued Liquidation Costs |
September 30, 2021 | June 30, 2021 | |||||||
Development costs: | ||||||||
Construction costs | $ | 18,769 | $ | 23,480 | ||||
Construction warranty | 2,870 | 2,870 | ||||||
Indirect costs | 568 | 712 | ||||||
Bond refunds | (989 | ) | (1,134 | ) | ||||
Total development costs | 21,218 | 25,928 | ||||||
Holding costs: | ||||||||
Property tax | 1,727 | 1,901 | ||||||
Insurance | 994 | 1,291 | ||||||
Maintenance, utilities and other | 746 | 1,000 | ||||||
Total holding costs | 3,467 | 4,192 | ||||||
General and administrative costs: | ||||||||
Legal and other professional fees | 14,804 | 17,697 | ||||||
Payroll and payroll-related | 9,646 | 10,432 | ||||||
Directors and officers insurance | 2,576 | 2,576 | ||||||
State, local and other taxes | 2,206 | 2,217 | ||||||
Board fees and expenses | 1,363 | 1,558 | ||||||
Other | 768 | 983 | ||||||
Total general and administrative costs | 31,363 | 35,463 | ||||||
Total accrued liquidation costs | $ | 56,048 | $ | 65,583 |
7) | Forfeited Assets - Restricted for Qualifying Victims |
December 31, 2019 | June 30, 2019 | |||||||
Development costs: | ||||||||
Construction costs | $ | 86,939 | $ | 115,947 | ||||
Construction warranty | 2,870 | 3,955 | ||||||
Indirect costs | 1,371 | 2,112 | ||||||
Bond refunds | (1,511 | ) | (2,152 | ) | ||||
Total development costs | 89,669 | 119,862 | ||||||
Holding costs: | ||||||||
Property tax | 4,884 | 6,087 | ||||||
Insurance | 2,714 | 6,345 | ||||||
Maintenance, utilities and other | 2,284 | 2,508 | ||||||
Total holding costs | 9,882 | 14,940 | ||||||
General and administrative costs: | ||||||||
Legal and other professional fees | 18,531 | 26,550 | ||||||
Payroll and payroll related | 11,980 | 13,757 | ||||||
Board fees and expenses | 3,403 | 3,995 | ||||||
State, local and other taxes | 3,207 | 6,062 | ||||||
Marketing | 1,403 | 1,583 | ||||||
Other | 3,200 | 3,499 | ||||||
Total general and administrative costs | 41,724 | 55,446 | ||||||
Total accrued liquidation costs | $ | 141,275 | $ | 190,248 |
Item 1. | Financial Statements (Continued) |
September 30, 2021 | June 30, 2021 | |||||||
Restricted cash (Note 4) | $ | 1,817 | $ | 1,836 | ||||
Other assets (Note 5) | 1,549 | 1,549 | ||||||
Accrued liquidation costs | (199 | ) | (218 | ) | ||||
Net assets in liquidation - restricted for Qualifying Victims | $ | 3,167 | $ | 3,167 |
Net Change In Assets and Liabilities |
Cash Activities | Remeasure- ment | Total | ||||||||||
Real estate assets held for sale, net | $ | 0 | $ | 0 | $ | 0 | ||||||
Cash and cash equivalents | 0 | 0 | 0 | |||||||||
Restricted cash | (19 | ) | 0 | (19 | ) | |||||||
Other assets | 0 | 0 | 0 | |||||||||
Total assets | $ | (19 | ) | $ | 0 | $ | (19 | ) | ||||
Accounts payable and accrued liabilities | $ | 0 | $ | 0 | $ | 0 | ||||||
Accrued liquidation costs | (19 | ) | 0 | (19 | ) | |||||||
Total liabilities | $ | (19 | ) | $ | 0 | $ | (19 | ) | ||||
Change in carrying value of assets and liabilities, net | $ | 0 | $ | 0 | $ | 0 |
Item 1. | Financial Statements (Continued) |
Cash Activities | Remeasure- ment | Total | ||||||||||
Real estate assets held for sale, net | $ | (42,454 | ) | $ | 2,965 | $ | (39,489 | ) | ||||
Cash and cash equivalents | 34,803 | 0 | 34,803 | |||||||||
Restricted cash | 0 | 0 | 0 | |||||||||
Other assets | (700 | ) | 823 | 123 | ||||||||
Total assets | $ | (8,351 | ) | $ | 3,788 | $ | (4,563 | ) | ||||
Accounts payable and accrued liabilities | $ | 0 | $ | 49 | $ | 49 | ||||||
Accrued liquidation costs | (8,723 | ) | (793 | ) | (9,516 | ) | ||||||
Total liabilities | $ | (8,723 | ) | $ | (744 | ) | $ | (9,467 | ) | |||
Change in carrying value of assets and liabilities, net | $ | 372 | $ | 4,532 | $ | 4,904 |
Distributions declared | $ | 0 | ||
Distributions reversed | 99 | |||
Distributions (declared) reversed, net | $ | 99 |
Item 1. | Financial Statements (Continued) |
Cash Activities | Remeasure- ment | Total | ||||||||||
Real estate assets held for sale, net | $ | (33,492 | ) | $ | (11,917 | ) | $ | (45,409 | ) | |||
Cash and cash equivalents | 26,341 | 0 | 26,341 | |||||||||
Restricted cash | 688 | 0 | 688 | |||||||||
Other assets | (588 | ) | 85 | (503 | ) | |||||||
Total assets | $ | (7,051 | ) | $ | (11,832 | ) | $ | (18,883 | ) | |||
Accounts payable and accrued liabilities | $ | (496 | ) | $ | 362 | $ | (134 | ) | ||||
Accrued liquidation costs | (12,689 | ) | (11,143 | ) | (23,832 | ) | ||||||
Total liabilities | $ | (13,185 | ) | $ | (10,781 | ) | $ | (23,966 | ) | |||
Change in carrying value of assets and liabilities, net | $ | 6,134 | $ | (1,051 | ) | $ | 5,083 |
Cash Activities | Remeasure- ment | Total | ||||||||||
Real estate assets, net | $ | (82,967 | ) | $ | (7,040 | ) | $ | (90,007 | ) | |||
Cash | 61,843 | - | 61,843 | |||||||||
Restricted cash | (358 | ) | - | (358 | ) | |||||||
Other assets | (968 | ) | 1,950 | 982 | ||||||||
Total assets | $ | (22,450 | ) | $ | (5,090 | ) | $ | (27,540 | ) | |||
Accounts payable and accrued liabilities | $ | (365 | ) | $ | 117 | $ | (248 | ) | ||||
Accrued liquidation costs | (25,839 | ) | (2,413 | ) | (28,252 | ) | ||||||
Total liabilities | $ | (26,204 | ) | $ | (2,296 | ) | $ | (28,500 | ) | |||
Change in carrying value of assets and liabilities, net | $ | 3,754 | $ | (2,794 | ) | $ | 960 |
Distributions declared | $ | (29,969 | ) | |
Distributions reversed | 92 | |||
Distributions declared, net | $ | (29,877 | ) |
9) | Credit Agreement |
Item 1. | Financial Statements (Continued) |
10) | Beneficial Interests |
For the Three Months Ended September 30, | ||||||||||||||||
2021 | 2020 | |||||||||||||||
Liquidation Trust Interests | Class A | Class B | Class A | Class B | ||||||||||||
Outstanding at beginning of period | 11,512,855 | 675,784 | 11,518,232 | 675,558 | ||||||||||||
Allowed claims | 302 | 0 | 3,319 | 1,133 | ||||||||||||
5% enhancement for certain allowed claims | 0 | 0 | 166 | 56 | ||||||||||||
Settlement of claims by cancelling Liquidation | ||||||||||||||||
Trust Interests | (1,392 | ) | (167 | ) | (2,267 | ) | (435 | ) | ||||||||
Outstanding at end of period | 11,511,765 | 675,617 | 11,519,450 | 676,312 |
For the Three Months Ended September 30, | ||||||||||||||||
2021 | 2020 | |||||||||||||||
Liquidation Trust Interests | Class A | Class B | Class A | Class B | ||||||||||||
Reserved for unresolved claims at beginning of period | 124,609 | 5,011 | 193,559 | 7,118 | ||||||||||||
Allowed claims | (302 | ) | 0 | (3,319 | ) | (1,133 | ) | |||||||||
5% enhancement for certain allowed claims | 0 | 0 | (16 | ) | 0 | |||||||||||
Disallowed claims | (3,146 | ) | 0 | (7,115 | ) | (342 | ) | |||||||||
Reserved for unresolved claims at end of period | 121,161 | 5,011 | 183,109 | 5,643 |
Item 1. | Financial Statements (Continued) |
11) | Distributions |
Cash Activities | Remeasure- ment | Total | ||||||||||
Real estate assets, net | $ | (103,929 | ) | $ | (5,251 | ) | $ | (109,180 | ) | |||
Cash | 63,832 | - | 63,832 | |||||||||
Restricted cash | (394 | ) | - | (394 | ) | |||||||
Other assets | (1,396 | ) | 2,556 | 1,160 | ||||||||
Total assets | $ | (41,887 | ) | $ | (2,695 | ) | $ | (44,582 | ) | |||
Accounts payable and accrued liabilities | $ | (370 | ) | $ | 226 | $ | (144 | ) | ||||
Accrued liquidation costs | (46,231 | ) | (2,742 | ) | (48,973 | ) | ||||||
Total liabilities | $ | (46,601 | ) | $ | (2,516 | ) | $ | (49,117 | ) | |||
Change in carrying value of assets and liabilities, net | $ | 4,714 | $ | (179 | ) | $ | 4,535 |
Liquidation Trust Interests | Class A | Class B | ||||||
Outstanding at June 30, 2019 | 11,433,623 | 655,261 | ||||||
Allowed claims | 84,855 | 21,334 | ||||||
5% enhancement for certain allowed claims | 459 | 5 | ||||||
Settlement of claims by reducing Liquidation Trust Interests | (2,663 | ) | (761 | ) | ||||
Outstanding at December 31, 2019 | 11,516,274 | 675,839 |
Liquidation Trust Interests | Class A | Class B | ||||||
Reserved for unresolved claims at June 30, 2019 | 482,734 | 34,697 | ||||||
Allowed claims | (84,855 | ) | (21,334 | ) | ||||
Disallowed claims | (41,688 | ) | (5,406 | ) | ||||
Reserved for unresolved claims at December 31, 2019 | 356,191 | 7,957 |
Related Party Transactions |
Item 1. | Financial Statements (Continued) |
13) | Causes of Action |
Item 1. |
14) | Commitments and Contingencies |
Item 1. | Financial Statements (Continued) |
Subsequent Events |
Liquidation Trust Interests | Class A | Class B | ||||||
Reserved for unresolved claims at January 1, 2020 | 356,191 | 7,957 | ||||||
Allowed claims | - | - | ||||||
Disallowed claims | (79,071 | ) | - | |||||
Reserved for unresolved claims at February 12, 2020 | 277,120 | 7,957 |
Item 1. | Financial Statements (Continued) |
(Unaudited) |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued) |
Class of Interest | Number Outstanding | |||
Class A Liquidation Trust Interests | ||||
Class B Liquidation Trust Interests |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued) |
Net assets in liquidation, as of September 30, 2019 | $ | 333,582 | ||||||||||||||
Restricted for Qualifying Victims | All Interestholders | Total | ||||||||||||||
Net assets in liquidation as of June 30, 2021 | $ | 3,167 | $ | 126,373 | $ | 129,540 | ||||||||||
Change in assets and liabilities: | ||||||||||||||||
Restricted for Qualifying Victims - change in carrying value of assets and liabilities, net | - | - | - | |||||||||||||
All interestholders: | ||||||||||||||||
Change in carrying value of assets and liabilities, net | 960 | - | 4,904 | 4,904 | ||||||||||||
Distributions reversed | 41 | |||||||||||||||
Distributions (declared) reversed, net | - | 99 | 99 | |||||||||||||
Net change in assets and liabilities | 1,001 | - | 5,003 | 5,003 | ||||||||||||
Net assets in liquidation, as of December 31, 2019 | $ | 334,583 | ||||||||||||||
Net assets in liquidation, as of September 30, 2021 | $ | 3,167 | $ | 131,376 | $ | 134,543 |
Restricted for Qualifying Victims | All Interestholders | Total | ||||||||||
Sales proceeds in excess of carrying value | $ | - | $ | 3,071 | $ | 3,071 | ||||||
Settlement recoveries recognized, net | - | 926 | 926 | |||||||||
Remeasurement of assets and liabilities, net | - | 812 | 812 | |||||||||
Other | - | 95 | 95 | |||||||||
Change in carrying value of assets and liabilities, net | $ | - | $ | 4,904 | $ | 4,904 |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued) |
Net assets in liquidation, as of June 30, 2020 | $ | 264,517 | ||
Change in assets and liabilities: | ||||
Change in carrying value of assets and liabilities, net | 5,083 | |||
Distributions (declared) reversed, net | (29,877 | ) | ||
Net change in assets and liabilities | (24,794 | ) | ||
Net assets in liquidation, as of September 30, 2020 | $ | 239,723 |
Reduction of state, local and other taxes | $ | 2,890 | ||
Settlement recoveries recognized, net | 1,402 | |||
Sales proceeds in excess of carrying value | 1,424 | |||
Remeasurement of assets and liabilities, net | (5,040 | ) | ||
Other | 284 | |||
Change in carrying value of assets and liabilities, net | $ | 960 |
Net assets in liquidation, as of June 30, 2019 | $ | 329,971 | ||
Change in assets and liabilities: | ||||
Change in carrying value of assets and liabilities, net | 4,535 | |||
Distributions reversed | 77 | |||
Net change in assets and liabilities | 4,612 | |||
Net assets in liquidation, as of December 31, 2019 | $ | 334,583 |
Settlement recoveries recognized, net | $ | 6,195 | ||
Carrying value in excess of sales proceeds | (263 | ) | ||
Remeasurement of assets and liabilities, net | (883 | ) | ||
Other | 34 | |||
Change in carrying value of assets and liabilities, net | $ | 5,083 |
Reduction of state, local and other taxes | $ | 2,890 | ||
Settlement recoveries recognized, net | 3,476 | |||
Sales proceeds in excess of carrying value | 3,291 | |||
Remeasurement of assets and liabilities, net | (5,314 | ) | ||
Other | 192 | |||
Change in carrying value of assets and liabilities, net | $ | 4,535 |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued) |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued) |
Date Declared | $ per Class A Interest | During the Period from February 15, 2019 (inception) through September 30, 2021 ($ in Millions) | During the Period from February 15, 2019 (inception) through November 12, 2021 ($ in Millions) | ||||||||||||||||||||||||||
Total Declared | Paid | Restricted Cash Account | Total Declared | Paid | Restricted Cash Account | ||||||||||||||||||||||||
Distributions Declared | |||||||||||||||||||||||||||||
First | 3/15/2019 | $ | 3.75 | $ | 44.70 | $ | 42.32 | $ | 2.38 | $ | 44.70 | $ | 42.32 | $ | 2.38 | ||||||||||||||
Second | 1/2/2020 | 4.50 | 53.43 | 51.19 | 2.24 | 53.43 | 51.19 | 2.24 | |||||||||||||||||||||
Third | 3/31/2020 | 2.12 | 25.00 | 24.19 | 0.81 | 25.00 | 24.19 | 0.81 | |||||||||||||||||||||
Fourth | 7/13/2020 | 2.56 | 29.97 | 29.24 | 0.73 | 29.97 | 29.24 | 0.73 | |||||||||||||||||||||
Fifth | 10/19/2020 | 2.56 | 29.95 | 29.20 | 0.75 | 29.95 | 29.20 | 0.75 | |||||||||||||||||||||
Sixth | 1/7/2021 | 4.28 | 50.01 | 48.67 | 1.34 | 50.01 | 48.67 | 1.34 | |||||||||||||||||||||
Seventh (a) | 5/13/2021 | 2.58 | 30.02 | 29.33 | 0.69 | 30.02 | 29.33 | 0.69 | |||||||||||||||||||||
Eighth | 10/8/2021 | 3.44 | - | - | - | 40.02 | 39.14 | 0.88 | |||||||||||||||||||||
Subtotal | $ | 25.79 | $ | 263.08 | $ | 254.14 | 8.94 | $ | 303.10 | $ | 293.28 | 9.82 | |||||||||||||||||
Distributions Reversed | |||||||||||||||||||||||||||||
Disallowed/cancelled (b) | (2.93 | ) | (2.93 | ) | |||||||||||||||||||||||||
Returned (c) | 0.74 | 0.74 | |||||||||||||||||||||||||||
Subtotal | (2.19 | ) | (2.19 | ) | |||||||||||||||||||||||||
Distributions Paid from Reserve Account (d) | (2.20 | ) | (2.22 | ) | |||||||||||||||||||||||||
Distributions Payable, Net | as of 9/30/2021: | $ | 4.55 | as of 11/12/2021: | $ | 5.41 |
(a) | The seventh distribution included the cash the Trust received from Fair Funds. |
(b) | As a result of claims being disallowed or Class A Interests cancelled. |
(c) | Distribution checks returned or not cashed. |
(d) | Paid as claims are allowed or resolved. |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued) |
Less than 1 year | 1-3 years | 3-5 years | 5 years | Total | ||||||||||||
Construction contracts (1) | $ | 52,000 | ||||||||||||||
Office lease | $ | 160 | $ | - | $ | - | $ | - | 160 | |||||||
Total | $ | 160 | $ | - | $ | - | $ | - | $ | 52,160 |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued) |
Item 4. |
Item 1. | Legal Proceedings (Continued) |
Item 1. | Legal Proceedings (Continued) |
Item 1. | Legal Proceedings (Continued) |
Item 1. | Legal Proceedings (Continued) |
• | Preferential transfers. Certain of the actions include claims arising under chapter 5 of the Bankruptcy Code, and seek to avoid or recover payments made by the Debtors during the 90 days prior to the December 4, 2017 bankruptcy filing, including payments to miscellaneous vendors and former Noteholders and Unitholders. |
• | Fraudulent transfers (Interest to Noteholders and Unitholders). Certain of the actions include claims arising under chapter 5 of the Bankruptcy Code, and seek to avoid or recover payments made by the Debtors during the course of the Ponzi scheme (from July 2012 through the December 4, 2017 bankruptcy filing) for interest paid to former Noteholders and Unitholders. |
• | Fraudulent transfers (Shapiro personal expenses). Certain of the actions include claims arising under chapter 5 of the Bankruptcy Code, and seek to avoid and recover payments made by the Debtors during the course of the Ponzi scheme (from July 2012 through the December 4, 2017 bankruptcy filing) for the personal expenses of Robert and Jeri Shapiro, including those identified in a forensic report prepared in connection with an SEC enforcement action in the United States District Court for the Southern District of Florida. |
o | The Trust has filed over 400 legal actions of this nature, many of which have been resolved, resulting in recoveries by or judgments in favor of the Trust. Since inception and as of October 31, 2021, the Trust has obtained judgments of approximately $8.17 million and has entered into settlements in approximately 200 legal actions and approximately 245 potential avoidance claims for which litigation was not filed, resulting in an aggregate of approximately $16.36 million of cash payments made or due to the Trust and approximately $9.93 million in reductions of claims against the Trust. |
o | In addition, other legal proceedings are being prosecuted by the Trust and United States governmental authorities, which actions may result in recoveries in favor of the Trust. Such actions currently include: |
• | Fraudulent transfers and fraud (against former agents). These actions, which arise under chapter 5 of the Bankruptcy Code and applicable state law governing fraudulent transfers, seek to avoid and recover payments made by the Debtors during the course of the Ponzi scheme (from July 2012 through the December 4, 2017 bankruptcy filing) for commissions to former agents, as well as for fraud, aiding and abetting fraud, and the unlicensed sale of securities asserted by the Trust based on claims contributed to the Trust by defrauded investors. These actions were filed by the Trust in the United States Bankruptcy Court for the District of Delaware between November 15, 2019 and December 4, 2019. Actions of this type are also being pursued by the SEC, and it is the Trust’s understanding that any recoveries obtained by the SEC will be transmitted to the Trust pursuant to a Fair Fund established by the SEC. |
• | Actions regarding the Shapiro’s personal assets. On December 4, 2019, the Trust filed an action in the Bankruptcy Court, Adv. Pro. No. 10-51076 (BLS), Woodbridge Liquidation Trust v. Robert Shapiro, Jeri Shapiro, 3X a Charm, LLC, Carbondale Basalt Owners, LLC, Davana Sherman Oaks Owners, LLC, In Trend Staging, LLC, Midland Loop Enterprises, LLC, Schwartz Media Buying Company, LLC and Stover Real Estate Partners LLC. In this action, the Trust asserts claims under chapter 5 of the Bankruptcy Code and applicable state law for avoidance of preferential and fraudulent transfers together with claims for fraud, aiding and abetting fraud, the unlicensed sale of securities, breach of fiduciary duty and unjust enrichment. The Trust seeks to recover damages and assets held in the names of Robert Shapiro, Jeri Shapiro and their family members and entities owned or controlled by them, which assets the Trust contends are beneficially owned by the Debtors or for which the Debtors are entitled to recover based on the Shapiros’ defalcations, including over $20 million in avoidable transfers. |
Item 1. | Legal Proceedings (Continued) |
• | Criminal proceeding and forfeiture. In connection with the United States’ criminal case against Robert Shapiro (Case No. No. 19-20178-CR-ALTONAGA (S.D. Fla. 2019)), Shapiro agreed to the forfeiture of certain assets. The Trust filed a petition in the Florida court to claim the Forfeited Assets as property of the Debtors’ estates, and therefore as property that had vested in the Trust pursuant to the Plan. The Trust has entered into an agreement with the United States Department of Justice to resolve its claim. The agreement was approved by the Bankruptcy Court on September 17, 2020 and was approved by the United States District Court on October 1, 2020. Among other things, the agreement provides for the release of specified Forfeited Assets by the United States to the Trust, and for the Trust to liquidate those assets and distribute the net sale proceeds to Qualifying Victims, which include the vast majority of Trust beneficiaries—specifically, all former holders of Class 3 and 5 claims under the Plan and their permitted assigns—but do not include former holders of Class 4 claims under the Plan. The Trust has taken possession of the Forfeited Assets. |
Date of Sale | Number of Class A Interests Sold | Number of Class B Interests Sold | Nature of the Transaction | Consideration Received | ||||||||
October 7, 2019 | 547.43 | - | Surrender of claims | Surrender of claims | ||||||||
October 31, 2019 | 6,130.88 | - | Surrender of claims | Surrender of claims | ||||||||
November 11, 2019 | 2,618.48 | 608.16 | Surrender of claims | Surrender of claims | ||||||||
November 25, 2019 | 5,019.83 | 1,780.82 | Surrender of claims | Surrender of claims | ||||||||
December 10, 2019 | 48,095.23 | 18,243.02 | Surrender of claims | Surrender of claims | ||||||||
Total | 62,411.85 | 20,632.00 |
Date of Sale | Number of Class A Interests Sold | Number of Class B Interests Sold | Nature of the Transaction | Consideration Received | |||||||
July 28, 2021 | 301.67 | - | Allowance of | Allowance of | |||||||
claims | claims | ||||||||||
Total | 301.67 | - |
Item 3. | Defaults upon Senior Securities |
Item 4. | Mine Safety Disclosures |
Item 5. | Other Information |
Exhibit Description | |
First Amended Joint Chapter 11 Plan of Liquidation of Woodbridge Group of Companies, LLC and its Affiliated Debtors dated August 22, 2018, incorporated herein by reference to the Registration Statement on Form 10 filed by the Trust on October 25, 2019. | |
Certificate of Trust of Woodbridge Liquidation Trust incorporated herein by reference to the Registration Statement on Form 10 filed by the Trust on October 25, 2019. | |
Liquidation Trust Agreement of Woodbridge Liquidation Trust dated February 15, 2019, as amended by Amendment No. 1 dated August 21, 2019 and Amendment No. 2 dated September 13, 2019, incorporated herein by reference to the Registration Statement on Form 10 filed by the Trust on October 25, 2019. | |
Amendment No. 3 to Liquidation Trust Agreement dated as of November 1, 2019, incorporated herein by reference to Amendment No. 1 to Registration Statement on Form 10 filed by the Trust on December 13, 2019. | |
Amendment No. 4 to Liquidation Trust Agreement dated as of February 5, 2020, incorporated herein by reference to the Current Report on Form 8-K filed by the Trust on February 6, 2020. | |
Amended and Restated Bylaws of Woodbridge Liquidation Trust effective August 21, 2019, incorporated herein by reference to the Registration Statement on Form 10 filed by the Trust on October 25, 2019. | |
Limited Liability Company Agreement of Woodbridge Wind-Down Entity LLC dated February 15, 2019, incorporated herein by reference to the Registration Statement on Form 10 filed by the Trust on October 25, 2019. | |
Loan and Security Agreement | |
10.3 | Agreement and Amendment to Loan and Security Agreement dated December 18, 2020 by and among WB Propco, LLC and WB 141 S. Carolwood, LLC, as Borrowers, Woodbridge Wind-Down Entity, LLC, as Guarantor, and City National Bank of Florida, as Lender, incorporated by reference herein to the Form 10-Q filed by the Trust on May 17, 2021. |
10.4 | Assumption Agreement and Joinder dated February 11, 2021 by and among WB Propco, LLC, WB 638 Siena, LLC and WB 642 St. Cloud, LLC, as co-borrowers, Woodbridge Wind Down Entity, LLC, as guarantor, and City National Bank of Florida, incorporated by reference herein to the Form 10-Q filed by the Trust on May 17, 2021. |
10.5 | Amended and Restated Security Agreement dated February 11, 2021 by WB Propco, LLC, WB 638 Siena, LLC and WB 642 St. Cloud, LLC in favor of City National Bank of Florida, incorporated by reference herein to the Form 10-Q filed by the Trust on May 17, 2021. |
Amended and Restated Employment Agreement dated July 31, 2019 between Woodbridge Wind-Down Entity LLC and Frederick Chin, incorporated herein by reference to the Registration Statement on Form 10 filed by the Trust on October 25, 2019. | |
First Amendment to Amended and Restated Employment Agreement dated September 24, 2020 between Woodbridge Wind-Down Entity LLC and Frederick Chin, incorporated herein by reference to the Form 10-K filed by the Trust on September 28, 2020. | |
Indemnification Agreement dated February 27, 2019 between Woodbridge Wind-Down Entity LLC and Frederick Chin, incorporated herein by reference to the Registration Statement on Form 10 filed by the Trust on October 25, 2019. |
Employment Agreement dated November 12, 2019 between Woodbridge Wind-Down Entity LLC and Marion W. Fong, incorporated herein by reference to Amendment No. 1 to Registration Statement on Form 10 filed by the Trust on December 13, 2019. |
Item 6. | Exhibits (Continued) |
First Amendment to Employment Agreement dated September 24, 2020 between Woodbridge Wind-Down Entity LLC and Marion W. Fong, incorporated herein by reference to the Form 10-K filed by the Trust on September 28, 2020. | |
Indemnification Agreement dated November 12, 2019 between Woodbridge Wind-Down Entity LLC and Marion W. Fong, incorporated herein by reference to Amendment No. 1 to Registration Statement on Form 10 filed by the Trust on December 13, 2019. | |
Employment Agreement dated November 12, 2019 between Woodbridge Wind-Down Entity LLC and David Mark Kemper, incorporated herein by reference to Amendment No. 1 to Registration Statement on Form 10 filed by the Trust on December 13, 2019. | |
First Amendment to Employment Agreement dated September 24, 2020 between Woodbridge Wind-Down Entity LLC and David Mark Kemper, incorporated herein by reference to the Form 10-K filed by the Trust on September 28, 2020. | |
Indemnification Agreement dated November 12, 2019 between Woodbridge Wind-Down Entity LLC and David Mark Kemper, | |
Stipulation and Settlement Agreement between the United States and Woodbridge Liquidation Trust, as approved by order of the United States Bankruptcy Court for the District of Delaware entered September 17, 2020, incorporated herein by reference to the Form 10-K filed by the Trust on September 28, 2020. | |
Settlement Agreement dated August 6, 2021 by and among Mark Baker, Jay Beynon as Trustee for the Jay Beynon Family Trust DTD 10/23/1998, Alan and Marlene Gordon, Joseph C. Hull, Lloyd and Nancy Landman, and Lilly A. Shirley on behalf of themselves and the proposed Settlement Class, Michael I. Goldberg, as Trustee for Woodbridge Liquidation Trust, and Comerica Bank, incorporated herein by reference to the Form 10-K filed by the Trust on September 27, 2021. | |
Certification of Liquidation Trustee pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
Certification of Liquidation Trustee pursuant to 18 U.S.C. 1350, as Adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
Findings of Fact, Conclusions of Law, and Order Confirming the First Amended Joint Chapter 11 Plan of Liquidation of Woodbridge Group of Companies, LLC and its Affiliated Debtors, entered October 26, 2018, | |
Item 6. | Exhibits (Continued) |
Cover Page Interactive Data File (Formatted as Inline XBRL and contained in Exhibit 101) |
Woodbridge Liquidation Trust | ||
Date: November 12, 2021 | By: | /s/ Michael I. Goldberg |
Michael I. Goldberg, | ||
Liquidation Trustee |