PARTI FINANCIAL INFORMATION

Item1. Condensed Consolidated Financial Statements (Unaudited)

MAUI LAND& PINEAPPLE COMPANY,INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

See Notes to Condensed Consolidated Interim Financial Statements.

MAUI LAND& PINEAPPLE COMPANY,INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSSCOMPREHENSIVE INCOME (LOSS)

(UNAUDITED)

See Notes to Condensed Consolidated Interim Financial Statements.

MAUI LAND& PINEAPPLE COMPANY,INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERSOPERATIONS AND COMPREHENSIVE’ INCOMEEQUITY

(UNAUDITED)

See Notes to Condensed Consolidated Financial Statements.

MAUI LAND& PINEAPPLE COMPANY,INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(UNAUDITED)

For the Nine monthsThree Months EndedSeptember 30, 2017 March 31, 2022 and 20162021

(in thousands)

See Notes to Condensed Consolidated Interim Financial Statements.

MAUI LAND & PINEAPPLE COMPANY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

SUPPLEMENTAL SCHEDULE OF NON-CASH FINANCING ACTIVITIES:

See Notes to Condensed Consolidated Interim Financial Statements.

MAUI LAND& PINEAPPLE COMPANY,INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

(UNAUDITED)

The accompanying interim unaudited condensed consolidated interim financial statements have been prepared by Maui Land & Pineapple Company, Inc. (together with its subsidiaries, collectively, the “Company”) in accordanceconformity with U.S. generally accepted accounting principles (GAAP)in the United States (“GAAP”) for interim financial information that are consistent in all material respects with those applied in the Company’s Annual Report on Form 10-K10-K for the fiscal year ended December 31, 2016, 2021, and pursuant to the instructions to Form 10-Q10-Q and Article 8 promulgated by Regulation S-XS-X of the U.S. Securities and Exchange Commission (SEC)(“SEC”). Accordingly, they do not include all of the information and notes to the annual audited consolidated financial statements required by GAAP for complete financial statements. In the opinion of management, the accompanying unaudited condensed consolidated interim financial statements contain all normal and recurring adjustments necessary to fairly present the Company’s financial position, results of operations and cash flows for the interim periods ended September 30, 2017 March 31, 2022 and 2016.2021. The unaudited condensed consolidated interim financial statements and notes should be read in conjunction with the annual audited consolidated financial statements and notes thereto included in the Company’s Form 10-K10-K for the fiscal year ended December 31, 2016.2021.

The Company’sCompany’s reports for interim periods utilize numerous estimates of general and administrative expenses and other costs for the full year. Future actual amounts may differ from these estimates. Amounts reflected in these condensed consolidated interim reportsstatements are not necessarily indicative of results for a full year. Certain amounts in the December 31, 2016 condensed consolidated balance sheet were reclassified to conform to the current period’s presentation. Such amounts had no impact on total assets and liabilities or net income and comprehensive income previously reported.

Restricted cash of $2.3 million at March 31, 2022 consisted of deposits held in escrow from the prospective buyers of properties held for sale.

Basic and diluted weighted-average shares outstanding for the periodsthree months ended September 30, 2017 March 31, 2022 and 20162021 were as follows:19,398,085 and 19,327,739, respectively.

Basic net incomeloss per common share is computed by dividing net incomeloss by the weighted-averageweighted-average number of common shares outstanding. Diluted net incomeloss per common share is computed similar to basic net incomeloss per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the dilutive potential common shares from share-based compensation arrangements had been issued.

Potentially dilutive shares arise from non-qualified stock options to purchase common stock and non-vested restricted stock. The treasury stock method is applied to determine the number of potentially dilutive shares for non-vested restricted stock and stock options assuming that the shares of non-vested restricted stock are issued for an amount based on the grant date market price of the shares and that the outstanding stock options are exercised.

Property at September 30, 2017 March 31, 2022 and December 31, 2016 2021 consisted of the following:

Land

Most of the Company’s 23,000Company’s 22,800 acres of land were acquired between 1911 and 1932 and isare carried in its consolidated balance sheets at cost. Approximately 21,00020,700 acres of land are located in West Maui and comprise a largely contiguous parcel that extends from the shorelinesea to an elevation of approximately 5,700 feet. This parcel includes approximately 900 acres within the Kapalua Resort, a master-planned, destination resort and residential community located in West Maui encompassing approximately 3,000 acres. The Company’s remaining 2,0002,100 acres of land are located in Upcountry Maui in an area commonly known as HaliimaileHali’imaile and are mainly comprised of leased agricultural fields, including related processing and maintenance facilities.

Land Improvements

Land improvements are comprised primarily of roads, utilities, and landscaping infrastructure improvements at the Kapalua Resort. Also included is the Company’sCompany’s potable and non-potable water systems in West Maui. The majority of the Company’s land improvements were constructed and placed in service in the mid-to-late 1970’s or conveyed in 2017. Depreciation expense would be considerably higher if these assets were stated at current replacement cost.

Buildings

Buildings are comprised of restaurant, retail and light industrial spaces located at the Kapalua Resort and HaliimaileHali’imaile which are used in the Company’sCompany’s leasing operations. The majority of the buildings were constructed and placed in service in the mid-to-late 1970’s. Depreciation expense would be considerably higher if these assets were stated at current replacement cost.

Machinery and Equipment

Machinery and equipment are mainly comprised of zipline course equipment installed in 2008 at the Kapalua Resort and used in the Company’sCompany’s leasing operations. Also included are machinery and equipment used in the Company’s utilities operations.

Assets held for sale at September 30, 2017 March 31, 2022 and December 31, 2016 2021 consisted of the following:

NoneIn December 2021, the Company entered into an agreement to sell the Kapalua Central Resort project for $40.0 million. On May 5, 2022, terms of the agreement were amended to extend the diligence period to May 19, 2022 and extend the closing date to two weeks following the expiration of the diligence period. The buyer transferred a non-refundable deposit of $300,000 into escrow on March 31, 2022. 

In February 2022, the Company entered into an agreement to sell the 646-acre parcel in Upcountry Maui for $9.7 million. Terms of the agreement include a 30-day due diligence period, a closing date 30 days after the last day of the due diligence period, and other customary closing conditions. On May 2, 2022, the agreement was amended to extend the diligence period to May 16, 2022 and extend the closing date to no later than May 20, 2022. A $2.0 million deposit that was transferred into escrow on March 31, 2022 becomes non-refundable at the end of the diligence period.

The above assets held for sale have notbeen pledged as collateral under the Company’s credit facility.Credit Facility (as defined in Note 7).

In April 2017, approximately $6.7 million of land improvements were conveyed to the Company by the owner of a 125-acre portion of the Company’s Kapalua Mauka project. The owner purchased the 125-acre property, commonly known as Mahana Estates, in 2009. As part of the sale, the owner agreed to subsequently develop and convey to the Company upon completion certain easements, subdivision and utility improvements related to the Mahana Estates property.7.LONG-TERM DEBT

In February 2017,Long-term debt is comprised of amounts outstanding under the Company sold the 15-acre Kapalua Golf Academy practice course located in the Kapalua Resort for $7.0 million to the owner of the Kapalua Plantation and Bay Golf Courses. The property was sold without any development entitlements. The sale resulted in a gain of approximately $6.4 million. The Company applied $5.6 million of the sale proceeds toward its revolving line of credit facility.

In August 2016, the Company sold a five-acre, fully-entitled 42-unit workforce housing project located in West Maui for $3.0 million. As part of the transaction, the buyer also agreed to provide to the Company 12 residential workforce housing credits by August 2021. The sale resulted in a gain of approximately $2.8 million. The Company utilized the proceeds from the sale to pay down its First Hawaiian Bank credit facility.

In June 2016, the Company sold a fully-entitled 304-acre working-class community project located in West Maui, commonly referred to as Pulelehua, for $15.0 million. The sale resulted in a gain of approximately $14.3 million. The Company utilized the proceeds from the sale to payoff the outstanding balance of a term loan.

The Company has aCompany’s $15.0 million revolving line of credit facility with First Hawaiian Bank (Credit Facility). (“Credit Facility”) maturing on December 31, 2025. The Credit Facility matures on December 31, 2019 and provides options for two optional one-year extension periods.revolving or term loan borrowing. Interest on borrowingsrevolving loan borrowing is based on the Bank’s prime rate minus 1.125 percentage points. Interest on term loan borrowing is fixed at LIBOR plus 3.50% (4.46% at September 30, 2017).the Bank’s commercial loan rates with interest rate swap options available. The Company has pledged its 800-acre Kapalua Mauka project and approximately 30,000 square feet of commercial leased space in the Kapalua Resort as security for the Credit Facility. Net proceeds from the sale of any collateral are required to be repaid toward outstanding borrowings and will permanently reduce the Credit Facility’s revolving commitment amount. There are no0 commitment fees on the unused portion of the Credit Facility.

The terms of the Credit Facility include various representations, warranties, affirmative, negative and financial covenants and events of default customary for financings of this type. Financial covenants include a minimumminimum liquidity (as defined) of $1.0$2.0 million, a maximum of $45.0 million in total liabilities, and a limitation on new indebtedness.

The outstanding balance of the Credit Facility was zero as of March 31, 2022. The Company believes it iswas in compliance with the covenants under the Credit Facility.Facility as of March 31, 2022.

The Company’sCompany’s directors, officers and certain members of management receive a portion of their compensation in restricted shares of the Company’s common stock granted under the Company’s 2017Equity and Incentive Award Plans (Equity Plans)Plan (“Equity Plan”). Share-based compensation is valued based on the average of the high and low share price on the date of grant. Shares are issued upon execution of agreements reflecting the grantee’s acceptance of the respective shares subject to the terms and conditions of the Equity Plans.Plan. Restricted shares issued under the Equity PlansPlan vest quarterly and have voting and regular dividend rights but cannot be disposed of until such time as they are vested. All unvested restricted shares are forfeited upon the grantee’s termination of directorship or employment from the Company.

Each ofShare-based compensation is determined and awarded annually to the Company’s non-employee directors and certain members of management receive restricted shares of common stock annually. Share-based compensations totaled $327,000 and $123,000 for the nine months ended September 30, 2017 and 2016, respectively, for vesting of restricted shares granted.

The Company’sCompany’s officers and certain members of management receive share-based compensation based on their achievement of certain predefined performance goals and objectives under an incentive compensation plan.the Equity Plan.  Such share-based compensation is comprised of an annual incentive paid in shares of common stock and a long-term incentive paid in restricted shares vesting quarterly over a period of three years.

Share-based compensationscompensation totaled $1,065,000[approximately] $379,000 and $741,000$349,000 for the ninethree months ended September 30, 2017 March 31, 2022 and 2016, respectively, for shares issued2021, respectively. Included in these amounts were $273,000 and the vesting$163,000 of restricted shares granted toof common stock which vested during the Company’s officersfirstthree months of 2022 and certain members of management.2021, respectively.

9.ACCRUED RETIREMENT BENEFITS

Accrued retirement benefits at September 30, 2017 March 31, 2022 and December 31, 2016 2021 consisted of the following:

The Company has a defined benefit pension plan which covers substantially all of its former bargaining and non-bargaining full-time, part-time and intermittent employees. In 2011, pension benefits under the plan were frozen. The Company also has an unfunded non-qualified retirement plan covering nine of its former executives. The non-qualified retirement plan was frozen in 2009 and future vesting of additional benefits was discontinued.

The net periodic benefit costs for pension and postretirement benefits for the three and nine months ended September 30, 2017 March 31, 2022 and 20162021 were as follows:

The Company uses a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The Company’s effectiveprovision for income taxes is calculated using the liability method. Deferred income taxes are provided for all temporary differences between the financial statement and income tax ratebasis of assets and liabilities using tax rates enacted by law or regulation. A full valuation allowance was established for 2017 deferred income tax assets as of March 31, 2022 and 2016 reflects the recognition of expected federal alternative minimum tax liabilities and interim period tax benefits and changes to its tax valuation allowance. In 2017, the Company expects to fully utilize the special alternative minimum tax net operating loss carryforward from 2008 which allows for 100% offset to the alternative minimum taxable income in subsequent years. Subsequent to the full utilization of the 2008 carryforward balance, the Company can only offset the normally allowed 90% of alternative minimum taxable income with net operating loss carryforwards from other years.December 31, 2021, respectively.

The Company’sCompany’s reportable operating segments are comprised of the discrete business units whose operating results are regularly reviewed by the Company’s Chief Executive Officer – its chief decision maker – in assessing performance and determining the allocation of resources. The Company’s reportableReportable operating segments are as follows:

The Company’sCompany’s reportable operating segment results are measured based on operating income (loss), exclusive of interest, depreciation, general and administrative, share-based compensation, pension and other postretirement expenses.

Reportable operating segment revenues and income for the three and nine months ended September 30, 2017 March 31, 2022 and 20162021 were as follows:

The Company leases land primarily to agriculture operators and space in commercial buildings, primarily to restaurant and retail tenants through 2048. These operating leases generally provide for minimum rents and, in some cases, licensing fees, percentage rents based on tenant revenues, and reimbursement of common area maintenance and other expenses. Certain leases allow the lessee an option to extend or terminate the agreement. There have been are no changes leases allowing a lessee an option to purchase the underlying asset. Total leasing income subject to ASC Topic 842 for the three months ended March 31, 2022 and 2021 were as follows:

14.DISCONTINUED OPERATIONS

In December 2019, the Company entered into an Asset Purchase Agreement to sell the Public Utilities Commission (“PUC”) regulated assets of Kapalua Water Company, Ltd. and Kapalua Waste Treatment Company, Ltd. located in the statusKapalua Resort. The Company received net proceeds of commitments and contingencies asapproximately $4.2 million upon closing of the sale in May 2021. A loss of approximately $0.1 million was reported in discontinued operations for the three months ended March 31, 2021.

15.COMMITMENTS AND CONTINGENCIES

On December 31, 2018, the State of Hawaii Department of Health (“DOH”) issued a Notice and Finding of Violation and Order (“Order”) for alleged wastewater effluent violations related to the Company’s Annual ReportUpcountry Maui wastewater treatment facility. The facility was built in the 1960’s to serve approximately 200 single-family homes developed for workers in the Company’s former agricultural operations. The facility is made up of two1.5-acre wastewater stabilization ponds and surrounding disposal leach fields. The Order includes, among other requirements, payment of a $230,000 administrative penalty and development of a new wastewater treatment plant, which become final and binding – unless a hearing is requested to contest the alleged violations and penalties.

The DOH agreed to defer the Order without a hearing date while the Company continues working on Form 10-K fora previously approved corrective action plan to resolve and remediate the fiscal year ended facility’s wastewater effluent issues. Continued testing of wastewater effluent consistently returns results within the allowable ranges. No hearing date has been set as discussions with the DOH are still ongoing to address any other matters regarding the Order. At March, 31 2022 and December 31, 2016. 2021, approximately $23,000 was accrued related to the administrative penalty. The Company is presently unable to estimate the remaining amount, or range of amounts, of any probable liability, if any, related to the Order and no additional provision has been made in the accompanying consolidated financial statements.

There are various other claims and legal actions pending against the Company. In the opinion of management, after consultation with legal counsel, theThe resolution of these other matters is not expected to have a material adverse effect on the Company’s consolidated financial position or results of operations.operations after consultation with legal counsel.

GAAP establishes a framework for measuring fair value, and requires certain disclosures about fair value measurements to enable the reader of the unaudited condensed consolidated interim financial statements to assess the inputs used to develop those measurements by establishing a hierarchy for ranking the quality and reliability of the information used to determine fair values. GAAP requires that financial assets and liabilities be classified and disclosed in one of the following three categories:

Level 1: Quoted market prices in active markets for identical assets or liabilities.

Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data.

Level 3: Unobservable inputs that are not corroborated by market data.

the unaudited condensed consolidated balance sheets and unaudited condensed consolidated statements of cash flows. The fair value of cash, receivables and payables approximate their carrying value due to the short-term nature of the instruments. The valuation is based on settlements of similar financial instruments all of which are short-term in nature and are generally settled at or near cost. The fair value

17.RECENT ACCOUNTING PRONOUNCEMENTS

In May 2014, June 2016, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606)2016-13 to update the methodology used to measure current expected credit losses (“CECL”). This ASU requires that an entity use the defined five step processapples to recognize revenue. The ASU also requires additional disclosuresfinancial assets measured at amortized cost, including loans, held-to-maturity debt securities, net investments in leases, and is effective for annual periods beginning after December 15, 2016, including interim periods within that reporting period. While the Company continues to assess its contracts with customers, it does not currently expect a material impact on results of operations, cash flows or financial position. The Company expects the consolidated financial statement disclosures over revenue recognition will expand in order to comply with the ASU.

In March 2017, FASB issued ASU No. 2017-07, Compensation-Retirement Benefits.trade accounts receivable as well as certain off-balance sheet exposures, such as loan commitments. This ASU aimsrequires consideration of a broader range of reasonable and supportable information to improve the presentation of the net periodic pension cost and net periodic postretirement benefit cost by requiring the reporting of the service cost componentexplain credit loss estimates. The guidance must be adopted using a modified retrospective transition method through a cumulative-effect adjustment to retained earnings/(accumulated deficit) in the same line item or items as other compensation costs arising from services rendered by employees duringperiod of adoption. ASU 2019-10 was subsequently issued delaying the period. The other componentseffective date to the first quarter of net benefit cost are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations This ASU will be effective for public business entities for annual periods beginning after December 15, 2017.2023. The Company is in the process of assessing the impact of the ASU No, 2017-07on its consolidated financial statements.

In November 2021, the FASB issued ASU 2021-10 as an update of ASC Topic 832 to increase the transparency of government assistance received by a business entity, including disclosure of the types of transactions, the accounting for those transactions, and the effect of those transactions on its financial statements.

In May 2017, the FASB issued The ASU No. 2017-09, Compensation-Stock Compensation (Topic 718) Scope of Modification Accounting. This ASU clarifies which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. The standard is effective for interim and annual reporting periods beginning after December 15, 2017, with early adoption permitted. 2021. The Company is in the process of assessingcurrently evaluating the impact of the ASU No, 2017-09 on its consolidated financial statements.statements and related disclosures.

Item 2.  MMANAGEMENTANAGEMENT’S’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our unaudited condensed consolidated interim financial condition and results of operations should be read in conjunction with our annual audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 20162021 and the unaudited condensed consolidated financial statements and related notes included in this Quarterly Report on Form 10-Q. The following discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those expressed or implied by the forward-looking statements below. Factors that could cause or contribute to those differences in our actual results include, but are not limited to, those discussed below and those discussed elsewhere within this Quarterly Report, particularly in the section entitled “Cautionary Note Regarding Forward-Looking Statements.” Depending upon the context, the terms the “Company,” “we,” “our,” and “us,” refer to either Maui Land & Pineapple Company, Inc. alone, or to Maui Land & Pineapple Company, Inc. and its subsidiaries collectively.

Overview

Maui Land & Pineapple Company, Inc. is a Hawaii corporation and the successor to a business organized in 1909. The Company consists of a landholding and operating parent company, its principal subsidiary, Kapalua Land Company, Ltd. and certain other subsidiaries of the Company.

We own approximately 23,00023,000 acres of land on the island of Maui, Hawaii and develop, sell, and manage residential, resort, commercial, agricultural and industrial real estate through the following business segments:

Critical Accounting PoliciesWe continue to monitor the effects of the COVID-19 pandemic on us, our customers, and Estimatesour vendors. While we are not able to accurately predict the magnitude or scope of such impacts at this time, should the existence of the COVID-19 pandemic continue for an extended period, our future business operations, including the results of operations, cash flows and financial position will be significantly affected. Appropriate remote work arrangements continue to be established for our employees in order to maintain our financial reporting systems.

The preparation

RESULTS OF OPERATIONSResults of Operations

Three and Nine monthsMonths Ended September 30, 2017March 31, 2022 compared to Three and Nine monthsMonths Ended March 31, 2021September 30, 2016

CONSOLIDATED