SECURITIES AND EXCHANGE COMMISSION

                          Washington, D.C.  20549



                                 FORM 10-K

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

For the fiscal year
ended December 31, 2005                  Commission File Number #0-50273

                            KAANAPALI LAND, LLC
          (Exact name of registrant as specified in its charter)


        Delaware                             01-0731997
(State of organization)           (I.R.S. Employer Identification No.)


900 N. Michigan Ave., Chicago, Illinois         60611
(Address of principal executive office)       (Zip Code)


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


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

                                          Name of each exchange
      Title of each class                 on which each class
      to be so registered                 is to be registered
      -------------------                 ---------------------
            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 whether 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 (the "Act") 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 if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K [ X ]

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Act).  Yes [   ]   No [ X ]

Indicate by check mark whether the registrant is a shell company (as
defined in Rule 12b-2 of the Act).     Yes [   ]     No [ X ]



<PAGE>


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.

Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a
plan confirmed by a court.    Yes [ X ]   No [   ]

As of March 15, 2006, the registrant had 1,792,613 shares of common stock
outstanding.

Documents incorporated by reference:  None


<PAGE>


                             TABLE OF CONTENTS



                                                             Page
                                                             ----
PART I

Item 1.      Business. . . . . . . . . . . . . . . . . . . .    1

Item 1A.     Risk Factors. . . . . . . . . . . . . . . . . .    9

Item 2.      Properties. . . . . . . . . . . . . . . . . . .   10

Item 3.      Legal Proceedings . . . . . . . . . . . . . . .   11

Item 4.      Submission of Matters to a Vote of
             Security Holders. . . . . . . . . . . . . . . .   13


PART II

Item 5.      Market Price of and Dividends on the
             Registrant's Common Equity and
             Related Stockholder Matters . . . . . . . . . .   14

Item 6.      Financial Information . . . . . . . . . . . . .   15

Item 7.      Management's Discussion and
             Analysis of Financial Condition and
             Results of Operations . . . . . . . . . . . . .   16

Item 7A.     Quantitative and Qualitative Disclosures
             about Market Risk . . . . . . . . . . . . . . .   21

Item 8.      Financial Statements and
             Supplementary Data. . . . . . . . . . . . . . .   22

Item 9.      Changes in and Disagreements
             with Accountants on Accounting
             and Financial Disclosure. . . . . . . . . . . .   46

Item 9A.     Controls and Procedures . . . . . . . . . . . .   46


PART III

ITEM 10.     Managers and Executive Officers
             of the Registrant . . . . . . . . . . . . . . .   47

Item 11.     Executive Compensation. . . . . . . . . . . . .   49

Item 12.     Security Ownership of Certain
             Beneficial Owners and Management. . . . . . . .   50

Item 13.     Certain Relationships and
             Related Transactions. . . . . . . . . . . . . .   51

Item 14.     Principal Accountant Fees and Services. . . . .   51


PART IV

Item 15.     Exhibits, Financial Statement Schedules,
             and Reports on Form 8-K . . . . . . . . . . . .   52


SIGNATURES   . . . . . . . . . . . . . . . . . . . . . . . .   54


                                     i


<PAGE>


                                  PART I

ITEM 1.  BUSINESS

     Kaanapali Land, LLC ("Kaanapali Land"), 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").  As indicated in the Plan, Kaanapali
Land has elected to be taxable as a corporation.  The Debtors had filed
their petitions for reorganization under Chapter 11 on February 27, 2002
(the "Petition Date") in the United States Bankruptcy Court for the
Northern District of Illinois, Eastern Division (the "Bankruptcy Court"),
which petitions were consolidated into a single joint proceeding by the
Bankruptcy Court (the "Reorganization Case").

     The principal goal of the Plan was to address the Debtors' debt
burdens so that the Debtors could emerge from Chapter 11 with a viable
capital structure and with the resources necessary to operate their land
development business.  The Plan achieved this goal by converting certain
indebtedness and other liabilities of the Debtors into new equity of
Kaanapali Land (to the extent such creditors did not elect an available
cash distribution option).  Another goal of the Plan was to secure
additional liquidity for the Debtors to help fund future operations.  The
Plan achieved this goal through the Merger of Northbrook Corporation
("Northbrook") into FHTC and the subsequent merger of FHTC into Kaanapali
Land, which made the assets and liquidity of Northbrook available to the
Debtors to help fund their land development business.

     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").  After the Plan
Effective Date, Kaanapali Land continued to implement the restructuring
transactions that were contemplated to be effected under the Plan.  All
material requirements and transactions that the Company implemented under
the Plan are described herein.  On August 21, 2005, pursuant to a motion
for entry of final decree, the bankruptcy cases were closed.  References in
this Form 10-K to Kaanapali Land or the Company for dates on or after the
Plan Effective Date are to the entity surviving the Reorganization Case and
for dates before the Plan Effective Date are to predecessor entities,
unless otherwise specified.

     KLC Land (formerly known as Amfac Hawaii, LLC and, previously,
Amfac/JMB Hawaii, LLC) is a Hawaii limited liability company that is a
wholly-owned subsidiary of Kaanapali Land. KLC Land and Kaanapali Land have
continued the businesses formerly conducted by KLC Land and Northbrook and
their subsidiaries prior to the bankruptcy, although some of such
businesses have been discontinued or reduced in scope as described herein.

     Northbrook was formed in 1978 as a holding company to facilitate the
purchase of a number of businesses, generally relating to short line
railroads, rail car leasing and light manufacturing. Over 90% of the stock
of Northbrook was purchased by persons and entities affiliated with JMB
Realty Corporation, through a series of stock purchases in 1987 and 1988.
One of Northbrook's subsidiaries (later merged into Northbrook) purchased
the stock of Amfac, Inc. ("Amfac"), in 1988, pursuant to a public tender
offer, and thus Amfac became an indirect subsidiary of Northbrook at such
time. As a consequence of the merger of Amfac into Northbrook in 1995, KLC
Land, FHTC and Amfac's other direct subsidiaries became direct subsidiaries
of Northbrook. All existing shareholders of Northbrook contributed their
shares to Pacific Trail Holdings, LLC ("Pacific Trail") in 2000. Pursuant
to the Plan, Northbrook was merged into FHTC and FHTC was thereafter merged
into Kaanapali Land in November 2002.


<PAGE>


     Kaanapali Land's subsidiaries include the Debtors as reorganized under
the Plan, certain subsidiaries of KLC Land that were not debtors (the "Non-
Debtor KLC Subsidiaries") and other former subsidiaries of Northbrook
(collectively with Kaanapali Land, all the Reorganized Debtors, the Non-
Debtor KLC Subsidiaries and such other subsidiaries are referred to herein
as the "Company").  Kaanapali Land pursues its businesses utilizing the
assets of the KLC Debtors and the Non-Debtor KLC Subsidiaries and the
assets formerly owned by Northbrook and its other subsidiaries.

     The Company operates in three primary business segments:  (i)
Property, (ii) Agriculture and (iii) Golf.  The Company operates through a
number of subsidiaries, each of which is 100% owned directly or indirectly
by Kaanapali Land, LLC.

     SUMMARY OF PLAN

     Material aspects of the history and business of the Company, the Plan,
the procedures for consummating the Plan and the risks attendant thereto
were set forth in a 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,
dated June 11, 2002 (the "Disclosure Statement").  The Disclosure Statement
and the Plan are each filed as Exhibits to Form 10 filed on May 1, 2003 and
incorporated herein by reference.

     All claims against the Debtors were deemed discharged as of the Plan
Effective Date, provided that creditors with allowed claims became entitled
to receive distributions under the Plan as of that date and provided that
the Plan does not impair any claims of taxing authorities.  The time for
filing proofs of claim relating to all classes of claims has expired prior
to the Plan Effective Date, including the period for those whose executory
contracts were rejected by the Debtors.  Therefore, all claims that could
be asserted by the creditors against the Debtors relative to amounts due on
pre-petition obligations as of the Plan Effective Date are known and has
since been liquidated or otherwise disposed of.  However, any claims of the
Internal Revenue Service ("IRS") relative to pre-petition transactions were
left unimpaired by the Plan, as described below.

     The Limited Liability Company Agreement of Kaanapali Land (the "LLC
Agreement") provides for two classes of membership interests, "Class A
Shares" and "Class B Shares", which have substantially identical rights and
economic value under the LLC Agreement; except that holders of Class A
Shares are represented by a "Class A Representative" who must approve
certain transactions proposed by Kaanapali Land before they can be
undertaken.  The Class A Representative is further entitled to receive
certain reports from the Company and meet with Company officials on a
periodic basis.  Reference is made to the LLC Agreement for a more detailed
discussion of these provisions. Class B Shares are held by Pacific Trail
Holdings, LLC ("Pacific Trail") and various entities and individuals that
are affiliated with Pacific Trail.  Class A Shares were issued under the
Plan to claimants who had no such affiliation.  Reference is made to
Item 10 below for a further explanation of the LLC Agreement and the rights
and duties of the Class A Representative.

     As of December 31, 2005, Kaanapali Land has distributed in the
aggregate, approximately $1.8 million in cash and approximately 161,100
Class A Shares on account of the claims that have been made under the Plan
and does not anticipate making any further distributions under the Plan.

     Kaanapali Land has issued all Class B Shares required to be issued
under the Plan to Pacific Trail and those entities and individuals who are
affiliated with Pacific Trail that are entitled to Class B Shares.  As a
consequence, Kaanapali Land has approximately 1,631,513 Class B Shares
outstanding.



<PAGE>


     Federal tax return examinations have been completed for all years
through 2000.  Refunds aggregating approximately $4.7 million are due for
previous payments of taxes and interest.  The statutes of limitations with
respect to the Company's tax return for 2001 and subsequent years remain
open.  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 could be liable could be material.

     KLC Land is the direct subsidiary of Kaanapali Land through which the
Company conducts substantially all of its operations, except those relating
to the Waikele Golf Course whose operations are conducted by another direct
subsidiary of Kaanapali Land.  KLC Land conducts all of its business
through various subsidiaries. Those with remaining assets of significant
net value include KLC Holdings Corp. ("KLC"), Pioneer Mill Company, LLC
("PMCo") and Kaanapali Development Corp. ("KDC").

     The Company has completed certain restructuring transactions and may
complete others, as permitted by the Plan, for the purpose of simplifying
the corporate structure and administrative organization of the Company.
The general impact of such transactions will be to reduce the number of
unneeded subsidiaries of Kaanapali Land and to move assets into those
entities that make the most sense for administrative reasons or to
facilitate future transactions with third parties.

     PROPERTY

     KAANAPALI 2020 PLANS.  "Kaanapali 2020", the comprehensive plan for
approximately 4,000 acres of land in the Kaanapali/Honokawai area on the
west side of Maui, Hawaii is one of Kaanapali Land's principal entitlement
focuses.  The entitlement work is being done by KDC, which owns, either
directly or through subsidiaries, substantially all of the land within the
Kaanapali 2020 boundaries.  Currently, the Company is preparing
applications for the necessary entitlements to carry out the Kaanapali 2020
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 county general plan amendments, as
well as rezoning approvals.  Approximately 1,500 acres of this land is
located toward the top of mountain ridges and in gulches and is classified
as conservation land, which precludes other use.  However, this land, and
other land that will be designated as open space, is an important component
of the overall project and assists in obtaining the entitlements for the
land as a whole.

     The process of determining market and project feasibility will be
ongoing with pursuit of entitlements.  If KDC obtains the necessary
entitlements, it intends, if market and project feasibility studies justify
it, to develop some or all of the project (either alone or through one or
more joint ventures with strategic partners) and/or sell some or all of the
entitled parcels.  KDC will need to apply for subdivision of the land in
order to develop the parcels.  As a condition to subdivision of the land,
the county will generally require the completion or bonding of certain
infrastructure, including roads, water and sewer facilities, each of which
will require their own building and grading permits as well as certain
extractions.



<PAGE>


     For the last several years, KDC has been working with the West Maui
community to involve the community in plans for the use of the Kaanapali
2020 lands.  Committees, comprised of private sector individuals from the
community as well as public employee participants, have been working with
KDC to create a vision for the future of the Kaanapali lands.  Variations
of this strategy have been used in several communities, including the
successful Weston, Florida planned community that has recently been
substantially completed by an affiliate of Kaanapali Land.  Management is
optimistic that a plan can be implemented with the support of the community
that meets Kaanapali Land's long-term financial objectives.

     The Kaanapali 2020 plan is currently at a predevelopment stage.  The
plan is now in the process of being finalized to the extent necessary to
commence the entitlement process.  Approximately 990 acres of land have
been identified to contain approximately 2,800 residential units along with
commercial, retail and recreational assets.  The balance of the land is
expected to remain open space or agricultural.  Over the next few years,
the Company expects to seek the necessary approvals to pursue its business
strategy.

     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, costs, both on site and offsite, and
regulatory and environmental requirements.

     The Company expects to prepare a land plan that is consistent with the
findings of the studies and then to 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, 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 include
applications for state land use reclassification, county community plan
amendments and changes in zoning.

     The entitlement process involves substantial amounts of time and
expense.  The applications generally require the submission of
comprehensive plans that involve the use of consultants and other
professionals.  Parties affected can challenge the applications at the time
of submission, 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, on any approvals of the entitlements.  These conditions may
include the requirement that the Company dedicate land for public use, fund
infrastructure improvements, pay impact fees and provide affordable housing
in the area.  The Company may also be subject to conditions that the
entitlement will be revoked if the project does not take place within a
particular time period.  If there is a significant change in the land
plans, if the governmental requirements change, or if market conditions
change subsequent to obtaining the county approvals, the Company may be
required to apply for amendments to the existing entitlements.  The
amendment process can also be lengthy and costly, and it may result in
additional conditions attaching to any approvals.

     If the Company is not successful in obtaining the necessary
entitlements as originally planned, the Company may be required to revise
its land plan.  In that case, the revised plans may not be as economically
viable as the original plan.  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.



<PAGE>


     During the first quarter of 2006, the Company received final
subdivision approval on an approximate 336 acre parcel in the region
"mauka" (toward the mountains) from the main Kaanapali 2020 area.  This
project, called Kaanapali Coffee Farms, consists of 58 agricultural lots
that are being offered to individual buyers.  The Company has begun
accepting reservations on certain of these lots which are expected to be
converted to contracts during the second quarter of 2006.  The Company
expects to begin closing on the lot sales and commence the land
improvements on the project during the second or third quarter of 2006.  It
is anticipated that the land improvements will be completed within an
approximate one year period.  In conjunction with the final approval, the
Company was required to obtain two subdivision bonds in the amounts of
approximately $18.6 million and $4.7 million and was required to secure the
bonds with a cash deposit of $8.3 million into an interest bearing
collateral account.  The funds will be withdrawn from the collateral
account by the Company upon completion of the subdivision improvements.

     OTHER PROPERTY.  Apart from the golf course (discussed below) and the
Kaanapali 2020 lands, the Company owns approximately 390 acres of remaining
land.  The site of the Pioneer Mill sugar mill that was closed in 1997
("Pioneer Mill Site") located in Lahaina and owned by a subsidiary of the
Company, is approximately 19.5 acres and is zoned for industrial use.
Pioneer Mill has entered into a contract for the demolition of the sugar
mill buildings on the Pioneer Mill site.  It is anticipated that such
demolition will cost approximately $3.2 million and that the work will be
completed during 2006.  Pioneer Mill also owns several parcels, known
collectively as the "Wainee Lands", which are located in Lahaina south of
the mill site.  The Wainee Lands include approximately 235 acres and are
classified and zoned for agricultural use.  The Company believes that
certain portions of the Wainee Lands might be available for a number of
uses compatible with the close proximity of the Wainee Lands to the Lahaina
Town-center, including both affordable and market housing and certain
recreational and service uses, once the property is reclassified and
rezoned.  The Company is conducting various meetings with the West Maui
community, public officials and consultants to determine a plan for a
portion of their lands.  A determination on the viability to proceed in the
entitlement process will be made during 2006.  However, the Company is
currently considering several options for the Wainee Lands.  During January
2005, the Company sold its mill sites and associated lands located on the
Island of Kauai for approximately $1.3 million.  On June 21, 2005, the
Company closed the sale of Lot 3 for a base price of $22.5 million with an
additional $6 million received during the third quarter of 2005 pursuant to
a purchase price adjustment agreement on the land.  The Company also owns
less than 100 acres of miscellaneous land parcels located on the Islands of
Kauai, Maui and Oahu.  These miscellaneous parcels primarily include land
associated with now-closed sugar growing and processing operations, remnant
parcels abutting infrastructure improvements from previously sold lands,
such as strips along roadways, and water-related assets.  It is not
expected that upon sale these miscellaneous parcels will yield any
significant cash proceeds to the Company.

     AGRICULTURE

     HISTORIC OPERATIONS.  A significant portion of the Company's revenues
were formerly derived from agricultural operations primarily consisting of
the cultivation, milling and sale of raw sugar.  The last remaining sugar
plantation of the Company, owned by a subsidiary of Kaanapali Land was shut
down at the end of 2000.  In September 2001, the Company also ceased its
coffee operations, which were owned by a subsidiary of Kaanapali Land.  The
Company liquidated its remaining inventory of coffee beans and mill
equipment.  The Company leased, or granted limited licenses to operate on,
to a third party, certain portions of the Kaanapali 2020 land on which the
coffee trees are located for the purpose of continuing agricultural coffee
operations on such land.  The lessee purchased the Company's coffee mill
equipment during the first quarter of 2004.



<PAGE>


     SEED CORN AND SOYBEAN OPERATIONS.  The Company's seed corn operations
are located on former Maui sugar lands that are now part of the Kaanapali
2020 area.  The Company earns modest income, under a contract with Monsanto
Seed Company that generates approximately $1.2 million of annual gross
revenue, to grow seed corn and soybeans according to Monsanto's
specifications.  In addition to generating such revenue, this operation is
otherwise advantageous, because the cultivated land helps control dust and
soil erosion and keeps the fields green, to the benefit of the local
community.  The Company may seek to expand this operation if it can find
ready markets for their products and it is profitable to do so.  There can
be no assurance that any expansion will occur or that current operations
will remain profitable.

     GOLF

     The Company owns the golf course land and improvements and is
responsible for the management and operation of an 18-hole golf course
known as the Waikele Golf Course on Oahu.  The Company ceased operations at
the golf course effective March 1, 2006 for approximately six months to
allow for renovations of the golf course greens and facilities.  The assets
and operations of the Waikele Golf Course represent all of the golf segment
for purposes of business segment information.  The cost of the renovations
and the shut-down of the course is not expected to have a material adverse
effect on the overall financial condition of the Company.

     For a description of financial information by segment, please read
Note 9 to the attached consolidated financial statements, which information
is incorporated herein by reference.

     SIGNIFICANT ASSET SALES

     There are strategic land sales that the Company has consummated or
that may occur based on options held by third parties.  These transactions
were generally pursued in order to raise additional cash that would enhance
the Company's ability to fund the Kaanapali 2020 development.  No further
significant bulk land sales are currently contemplated by the Company.

     NORTH BEACH.  At the Plan Effective Date and prior to the sale of
Lots 2 and 4 in 2003, the Company owned three beachfront lots that total
approximately 62 developable acres, commonly known as Lots 2, 3 and 4. All
three lots are zoned for hotel development.  In December 2000, the Company
sold a fourth parcel, the 14-acre Kaanapali Ocean Resort ("KOR") site known
as Lot 1, to SVO Pacific, Inc. ("SVO"), an affiliate of Starwood Hotels and
Resorts, which is in the process of developing time-share units on the
property.  In addition, SVO received an option to purchase Lot 2, which
contains approximately 11.5 acres.  In January 2003, the option for Lot 2
was exercised and the sale closed on January 31, 2003, at which time a non-
refundable payment was made for $2 million (before closing costs and
prorations).  The remainder of the purchase price was reflected by a note
secured by a mortgage due and paid in March 2004 for approximately $14.4
million.  On August 5, 2003, the Company closed the sale of Lot 4 (an
approximately 40 acre site) for a purchase price of $33 million; of which
$16 million was paid in cash (before closing costs and prorations) at
closing and the balance was delivered in the form of a promissory note in
the original principal amount of $17 million.  The note was fully collected
by the Company during December 2004.  At closing, the Company also granted
to the purchaser an option to purchase Lot 3.  On June 21, 2005, the
Company closed the sale of Lot 3 for a base price of $22.5 million,
pursuant to the option.  On September 12, 2005, the Company received $6
million pursuant to a purchase price adjustment agreement.



<PAGE>


     PARCEL 22/23.  Kaanapali Golf Estates ("KGE") is a residential
community that is part of the Kaanapali Beach Resort in West Maui.  KGE has
been subdivided into several parcels that have been sold to residential
developers.  There was one remaining parcel available for sale in the
residential community called "Parcel 22/23".  Parcel 22/23 includes
approximately 110 acres.  In December 2003, the Company closed on its sale
of Parcel 22/23 to a third party for a purchase price of $12.5 million.
Approximately $11.5 million was received in cash at closing and the Company
deposited approximately $1 million into an escrow account.  In conjunction
with the sale, the Company has agreed to pay a portion of the cost of
certain roadway improvements and pay the costs of the design and
construction of an underground sewer line and drainage construction as well
as the cost of certain other improvements.  Such escrowed funds are funding
the Company's portion of the costs associated with the road improvements
and the sewer and drainage costs.  The Company is responsible for certain
costs in excess of the escrowed funds associated with the road improvements
and sewer and drainage costs and has accrued approximately $1 million in
excess of the amount escrowed as an estimate of such costs.  These
improvement projects are proceeding and are expected to be completed during
2006.

     OTHER MAUI PROPERTY ASSETS

     The company has certain other property assets on Maui that are not
considered part of Kaanapali 2020.  The most significant of such assets is
the Pioneer Mill Site.

     PIONEER MILL SITE.  The Company owns approximately 19 acres in
Lahaina, known as the Pioneer Mill Site, which is zoned for industrial
development.  This was the former site of Pioneer Mill's sugar and coffee
mills on Maui.  Pioneer Mill is currently evaluating strategic options
relating to this site, but has in the interim entered into a contract for
the demolition of the sugar mill buildings on the Pioneer Mill site.  It is
anticipated that such demolition will cost approximately $3.2 million and
that the work will be completed during 2006.  Pioneer Mill was engaged in a
modest cleanup operation arising out of the discovery of petroleum
contamination found at the Pioneer Mill site.  The Pioneer Mill site was
assigned a high priority by the Hawaii Department of Health ("HDOH") and
the HDOH has shown an interest in the environmental conditions relating to
or arising out of the former operations of Pioneer Mill.  The United States
Environmental Protection Agency, Region IX (hereinafter "EPA") has
designated HDOH as the oversight agency for Pioneer Mill.  Pioneer Mill has
received a report on the results of environmental testing conducted on the
site by the United States Environmental Protection Agency and HDOH.
However, Pioneer Mill's cleanup efforts to date have satisfied HDOH and
Pioneer Mill received a no further action letter during the fourth quarter
of 2004.  It is possible that further clean up operations may become
necessary in connection with the demolition of the former sugar mill
buildings on the site.

     EMPLOYEES.

     At March 1, 2006, Kaanapali Land and its subsidiaries employed
approximately 64 persons, more than half of whom are employed at the
Waikele Golf Course.  Certain corporate services are provided by Pacific
Trail and its affiliates.  Kaanapali Land reimburses for these services and
related overhead at cost.



<PAGE>


     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,
the various trade names and service marks obtained in connection with the
Company's coffee operations and the use of the term "Waikele" in connection
with the Waikele golf course and related developments.  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 therefrom 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 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 operating deficits in its other business
segments.  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.

     Maui's real estate market has experienced improvement during 2004 and
2005 and the areas of primary and secondary residential homes, condominiums
and time share units have been relatively strong.  There can be no
assurance that the ongoing recovery of Maui's real estate market can be
sustained.

     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.

     The golf course operated by the Company competes with several other
golf courses located in its proximity and with other entertainment and
tourist activities.  In order to improve the golf course's competitive
position, the Company closed the golf course in order to implement certain
improvements, with an expected re-opening during the fourth quarter of
2006, as discussed below.  Competition in the agriculture business segment
affects the prices the Company may obtain for the land and other assets it
leases to third parties for the production of agricultural products.

     GOVERNMENT REGULATIONS AND APPROVALS

     The current regulatory approval process for a project can take three
to five years or more 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.  There is often
significant opposition from numerous groups - including native Hawaiians,
environmental organizations, various community and civic groups,
condominium associations and politicians advocating no-growth policies,
among others.



<PAGE>


     Currently, Kaanapali Land is preparing applications for the necessary
entitlements to carry out the Kaanapali 2020 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 county general plan amendments, as well as rezoning
approvals.  Entitlements for a 58 lot agricultural subdivision were
received during the first quarter of 2006.  Approximately 1,500 acres of
this land that is located toward the top of mountain ridges and in gulches
is classified as conservation, which precludes other use.  This
conservation land, and other land that will be designated as open space, is
an important component of the overall project and is expected to be part of
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, 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 such substances
including asbestos related liabilities.  Those laws and regulations often
impose liability without regard to fault.  The Company is not aware of any
environmental condition on any of its properties which is likely to have a
material adverse effect on its consolidated financial position or results
of operations; however, no assurance can be given that any such condition
does not exist or may not arise in the future.  Reference is made to
Item 3. Legal Proceedings for a description of certain legal proceedings
related to environmental conditions.


ITEM 1A.  RISK FACTORS

     Kaanapali Land faces numerous risks, including those set forth below.

     Reference is made to Item 1. Business and Item 3. Legal Proceedings
for an item specific detailed discussion of some of the risk factors facing
Kaanapali Land, LLC.

     Risk factors include a number of factors that could negatively impact
Kaanapali Land's property activities.  Any of the risks may have a material
adverse effect on the Company's success, consolidated financial position or
results of operations.

MARKET CONDITIONS AND COMPETITION

     The Company operates in a highly competitive market and is subject to
competition from 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, adverse market conditions,
such as an economic downturn in the economy locally or nationally or
internationally could thereby affect travel to Hawaii and result in a
downturn in the tourism industry which could negatively impact the real
estate industry in Hawaii.

GOVERNMENT REGULATIONS AND APPROVALS

     The current regulatory approval process for a project can take three
to five years or more and involves substantial expense.  A substantial
portion of the Company's Kaanapali 2020 land will require state district
boundary amendments and county general plan amendments, as well as rezoning
approvals.  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. There


<PAGE>


is often significant opposition from numerous groups - including native
Hawaiians, environmental organizations, various community and civic groups,
condominium associations and politicians advocating no-growth policies,
among others.  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.

ENVIRONMENTAL MATTERS AND LEGAL PROCEEDINGS

     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 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 chemicals used in
current and historical operations including asbestos related liabilities.
Those laws and regulations often impose liability without regard to fault.
No assurance can be given that any such condition does not exist or may not
arise in the future.

     Federal tax return examinations have been completed for all years
through 2000.  The statutes of limitations with respect to the Company's
tax return for 2001 and subsequent years remain open.  The Company believes
adequate provisions for income tax have been recorded for all years,
although there can be no assurance that such provision will be adequate.
To the extent that there is a shortfall, any such shortfall for which the
Company could be liable could be material.

LAND DEVELOPMENT PROJECTS

     The Company's ability to complete its projects on time and on budget
can be negatively affected by numerous variables including the inability to
secure entitlements on the land to be developed, construction delays or
cost overruns, weather related disasters such as hurricanes, tsunamis, and
heavy prolonged rains, the inability of subcontractors to perform their
contracts, and the inability to sustain sales.

GOLF COURSE OPERATIONS

     The Company's golf course competes with several other golf courses
located in the proximity and with other entertainment and tourist
activities.  In addition, the golf course operations are subject to risks
such as adverse weather conditions including heavy prolonged rains and
hurricanes, employee related issues such as a labor shortage and
disruptions, and an economic downturn in the economy which could effect
travel to Hawaii and a downturn in the tourism industry.


ITEM 2.  PROPERTIES

     LAND HOLDINGS.

     The major real properties owned by the Company are described under
Item 1. Business.




<PAGE>


ITEM 3.  LEGAL PROCEEDINGS

     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.  In proceedings filed prior to the Petition Date where a Debtor
was a defendant, such proceedings were stayed as against such Debtor by the
filing of the Reorganization Case.  Any claims that were not filed on a
timely basis under the Plan have been discharged by the Bankruptcy Court
and thus the underlying legal proceedings should not result in any
liability to the Debtors.  All other claims have been satisfied.
Proceedings against subsidiaries or affiliates of Kaanapali Land that are
not Debtors were not stayed by the Plan and may proceed.  However, one such
subsidiary, Oahu Sugar, filed a subsequent petition for liquidation under
Chapter 7 of the bankruptcy code in April 2005, as described below.

     On or about February 23, 2001 Kekaha Sugar Co., Ltd., a company that
was, prior to its dissolution, a subsidiary of Kaanapali Land, received a
letter from the Hawaii Department of Health ("HDOH") assigning the Kekaha
Sugar Co., Ltd. site a high priority status based on HDOH's review of
available environmental data.  In the letter, HDOH identified five major
areas of potential environmental concern including the former wood
treatment plant, the herbicide mixing plant, the seed dipping plant, the
settling pond, and the Kekaha Sugar Mill.  While setting forth specific
concerns, the HDOH reserved the right to designate still further areas of
potential concern which might require further investigation and possible
remediation.  HDOH further reserved the right to modify its prioritization
of the site should conditions warrant.  The assignment of the high priority
status will likely result in a high degree of oversight by the HDOH as the
issues raised are studied and addressed.  Kekaha Sugar Co., Ltd. responded
to the letter.  The United States Environmental Protection Agency has
performed a visual inspection of the property and indicated there will be
some testing performed.  HDOH has performed some testing at the site and
results are pending.  Kekaha Sugar Co., Ltd. was substantially without
assets and was dissolved and thus will be unable to perform in the event of
further pursuit of the matter by HDOH.  On or about February 23, 2001, the
Lihue Plantation Company, Limited, now known as LPC Corporation ("LPCo")
received a similar letter from the HDOH assigning the LPCo site a high
priority status based on HDOH's review of available environmental data.  In
the letter, HDOH identified four major areas of potential environmental
concern relative to LPCo's former operations including the herbicide mixing
plant, the seed dipping plant, the settling pond and the Lihue Sugar Mill.
While setting forth specific concerns, the HDOH reserved the right to
designate still further areas of potential concern which might require
further investigation and possible remediation.  HDOH further reserved the
right to modify its prioritization of the site should conditions warrant.
As noted above, the high priority assignment will likely result in a high
degree of oversight by the HDOH as the issues raised are studied and
addressed.  LPCo is substantially without assets, and further pursuit of
this matter by HDOH could have a material adverse effect on the financial
condition of LPCo.

     The purchaser of the Kekaha and Lihue Sugar Mill properties in January
2005 assumed any obligations for environmental matters concerning the
property it purchased.  However, there can be no assurance that such
purchasers will have sufficient assets to satisfy a claim should any
substantial liabilities result.



<PAGE>


     Pioneer Mill was engaged in a modest cleanup operation arising out of
the discovery of petroleum contamination found at the Pioneer Mill site.
The Pioneer Mill site was assigned a high priority by the HDOH and the HDOH
has shown an interest in the environmental conditions relating to or
arising out of the former operations of Pioneer Mill.  EPA has designated
HDOH as the oversight agency for Pioneer Mill.  Pioneer Mill received a
report on the results of environmental testing conducted on the site by the
United States Environmental Protection Agency and HDOH.  However, Pioneer
Mill's cleanup efforts to date have satisfied HDOH and Pioneer Mill
received a no further action letter during the fourth quarter of 2004.  It
is possible that further cleanup operations may become necessary in
connection with the ongoing demolition of the former sugar mill buildings
on the site.

     As a result of an administrative order issued to Oahu Sugar by the
HDOH, Order No. CH 98-001, dated January 27, 1998, Oahu Sugar was engaged
in environmental site assessment of lands it leased from the U.S. Navy and
located on the Waipio Peninsula.  Oahu Sugar submitted a Remedial
Investigation Report to the HDOH.  The HDOH provided comments which
indicated that additional testing may be required.  Oahu Sugar responded to
these comments with additional information.  On January 9, 2004, EPA issued
a request to Oahu Sugar seeking information related to the actual or
threatened release of hazardous substances, pollutants and contaminants at
the Waipio Peninsula portion of the Pearl Harbor Naval Complex National
Priorities List Superfund Site.  The request sought, among other things,
information relating to the ability of Oahu Sugar to pay for or perform a
clean up of the land formerly occupied by Oahu Sugar.  Oahu Sugar was in
the process of responding to the information requests and had notified both
the Navy and the EPA that while it had some modest remaining cash that it
could contribute to further investigation and remediation efforts in
connection with an overall settlement of the outstanding claims, Oahu Sugar
was substantially without assets and would be unable to make a significant
contribution to such an effort.  While Oahu Sugar contested its liability
for such contamination and believed that it had meritorious defenses to any
claims, it did not have sufficient assets to justify litigation and
believed that attempting to cooperate and negotiate with the government was
its only opportunity to avoid bankruptcy.  Nevertheless, attempts at
negotiating such a settlement were fruitless and Oahu Sugar received an
order from EPA in March 2005 that would purport to require certain testing
and remediation of the site.  While the cost of compliance could not be
estimated, it was clear that the cost involved would have greatly exceeded
Oahu Sugar's remaining assets.  Oahu Sugar has no source of additional
capital and has substantial unpaid obligations to Kaanapali Land and other
affiliates.  Furthermore, as Oahu Sugar is substantially without assets,
the pursuit of any action, informational, enforcement, or otherwise, would
have had a material adverse effect on the financial condition of Oahu
Sugar.

     Therefore, as a result of the pursuit of further action by the HDOH
and EPA as described above and the immediate material adverse effect that
the actions had on the financial condition of Oahu Sugar, Oahu Sugar filed
with the United States Bankruptcy Court, Northern District of Illinois,
Eastern Division its voluntary petition for liquidation under Chapter 7 of
Title 11, United States Bankruptcy Code, 11 U.S.C. Subsection 101-1330 on
April 19, 2005, Case No. 05-15100.  Such filing is not expected to have a
material adverse effect on the Company as Oahu Sugar was substantially
without assets at the time of the filing and it is not believed that any
other affiliates have any responsibility for the debts of Oahu Sugar.

     EPA sent two requests for information to Kaanapali Land regarding
Kaanapali Land's organization and relationship, if any, to entities that
may have, historically, operated on the site.  Kaanapali Land responded to
the requests for information.  It is not clear what EPA proposes to do with
the information that has been provided.  EPA has not designated Kaanapali
Land as a potentially responsible party.



<PAGE>


     Federal tax return examinations have been completed for all years
through 2000.  Refunds aggregating approximately $4.7 million are due for
previous payments of taxes and interest.  The statutes of limitations with
respect to the Company's tax return for 2001 and subsequent years remain
open.  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 could be liable could be material.

     On February 15, 2005, D/C Distribution Corporation ("D/C"), a
subsidiary of Kaanapali Land, was served with a lawsuit entitled American &
Foreign Insurance Company v. D/C Distribution and Amfac Corporation, Case
No. 04433669 filed in the Superior Court of the State of California for the
County of San Francisco, Central Justice Center.  In the eight-count
complaint for declaratory relief, reimbursement and recoupment of
unspecified amounts, costs and for such other relief as the court might
grant, plaintiff alleges that it is an insurance company to whom D/C has
tendered for defense and indemnity various personal injury lawsuits
allegedly based on exposure to asbestos containing products.  Plaintiff
alleges that because none of the parties have been able to produce a copy
of the policy or policies in question, a judicial determination of the
material terms of the missing policy or policies is needed.  Plaintiff
seeks, among other things, a declaration:  of the material terms, rights,
and obligations of the parties under the terms of the policy or policies;
that the policies have been exhausted; that plaintiff is not obligated to
reimburse D/C for its attorneys' fees in that the amounts of attorneys'
fees incurred by D/C have been incurred unreasonably; that plaintiff is
entitled to recoupment and reimbursement of some or all of the amounts it
has paid for defense and/or indemnity; and that D/C has breached its
obligation of cooperation with plaintiff.  D/C has filed an answer and an
amended cross-claim.  The litigation is in its early stages and D/C
believes that it has meritorious defenses and positions, and intends to
vigorously defend.  In February 2006, in order to simplify its
administration and facilitate an additional capital contribution by
Kaanapali Land, D/C merged into a newly-formed Illinois limited liability
company named D/C Distribution, LLC.

     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.  There are approximately 77 cases against such
subsidiary that are pending on the mainland and are alleged based on such
subsidiary's prior business operations.  Each company believes that it has
meritorious defenses against these actions, but can give no assurances as
to the ultimate outcome of these cases.  In the case of D/C, there can be
no certainty that it will be able to satisfy all of its liabilities for
these cases as it is without assets to satisfy any material existing or
future judgments, there can be no assurance that these cases (or any of
them) if adjudicated in a manner adverse to the subsidiary, will not have a
material adverse effect on the financial condition of such subsidiary.
Kaanapali Land does not believe that it has liability, directly or
indirectly, for such subsidiary's obligations.

     Other than as described above and the Reorganization Case 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.


ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     Not applicable.


<PAGE>


                                  PART II

ITEM 5.  MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S
         COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

     As of December 31, 2005 there were approximately 635 holders of record
of the Company's 161,100 outstanding Class A Shares and approximately 15
holders of record of the Company's 1,631,513 outstanding Class B Shares.
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 membership interests.  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 membership
interests in the Company will not receive annual K-1 reports or 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 have been paid by the Company in 2005, 2004 or 2003
and the Company does not anticipate making any distributions for the
foreseeable future.




<PAGE>


ITEM 6.  SELECTED FINANCIAL DATA

                          KAANAPALI LAND, LLC (a)
     For the years ended December 31, 2005, 2004, 2003, 2002 and 2001
              (Dollars in Thousands Except Per Share Amounts)

                      2005       2004      2003       2002       2001
                    --------   --------  --------   --------   --------
Total revenues
 (c) . . . . . .    $ 37,251     13,916    63,783     11,112     81,894
                    ========   ========  ========   ========   ========
Net income
 (loss) (d). . .    $ 21,042      4,887    70,636    140,784    (17,082)
                    ========   ========  ========   ========   ========

Income (loss)
 from continuing
 operations per
 share, basic
 and diluted . .    $  11.74       2.73      5.86      (b)       (6,794)
                    ========   ========  ========   ========   ========

Net income
 (loss) per
 share, basic
 and diluted . .    $  11.74       2.73     39.44      (b)       (4,270)
                    ========   ========  ========   ========   ========

Total assets . .    $187,875    179,401   189,473    189,626    223,628
                    ========   ========  ========   ========   ========

Certificate of
 Land Apprecia-
 tion Notes. . .    $  --         --        --         --       139,413
                    ========   ========  ========   ========   ========

      (a)   The  above selected financial data should be read in conjunc-
tion with the financial statements and the related notes appearing
elsewhere in this report.  The amounts reflected are those business
segments of the Company's predecessor that are continuing in nature.

      (b)   The income per share from continuing operations for the period
prior to the Plan Effective Date is $3,235 and the loss per share from
continuing operations for the period after the Plan Effective Date is $5.
The net income per share for the period prior to the Plan Effective Date is
$37,389 and the net loss per share for the period after the Plan Effective
Date is approximately $5.

      (c)   In 2001, the Company recognized as revenue a gain from the
extinguishment of debt of $10,653.

      (d)   In 2002, the Company recognized an extraordinary gain on
reorganization of $136,618.  In 2003, the Company recognized a gain on
disposition of unconsolidated investment of $60,134.





<PAGE>


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.  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, changes in national and Hawaiian economic conditions,
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.


LIQUIDITY AND CAPITAL RESOURCES

     A description of the reorganization of Kaanapali Land and its
subsidiaries pursuant to the Plan and a description of certain elements of
the Plan are set forth in Item 1 above.

     Unless wound up by the Company or merged, the Debtors continued to
exist after the Plan Effective Date as separate legal entities.  Except as
otherwise provided in the Order or the Plan, the Debtors have been
discharged from all claims and liabilities existing through the Plan
Effective Date.  As such, all persons and entities who had receivables,
claims or contracts with the Debtors that first arose prior to the Petition
Date and have not previously filed timely claims under the Plan or have not
previously reserved their right to do so in the Reorganization Case are
precluded from asserting any claims against the Debtors or their assets for
any acts, omissions, liabilities, transactions or activities that occurred
before the Plan Effective Date.  On August 31, 2005, pursuant to a motion
for entry of final decree, the bankruptcy cases were closed.

     On November 14, 2002, pursuant to the Plan, all of the KLC Debtors
executed and delivered to Kaanapali Land a certain Secured Promissory Note
in the principal amount of $70 million.  Such note matures on October 31,
2011 and carries an interest rate of 3.04% compounded semi-annually.  The
note, which is prepayable, is secured by substantially all of the remaining
real property owned by the KLC Debtors, pursuant to a certain Mortgage,
Security Agreement and Financing Statement, dated as of November 14, 2002
and placed on record in December 2002.  The note has been eliminated in the
consolidated financial statements because the obligors are consolidated
subsidiaries of Kaanapali Land.



<PAGE>


     In addition to such Secured Promissory Note, certain Non-Debtor KLC
Subsidiaries continue to be liable to Kaanapali Land under certain
guarantees (the "Guarantees") that they had previously provided to support
certain Senior Indebtedness (as defined in the Plan) and the Certificate of
Land Appreciation Notes ("COLA Notes") formerly issued by Amfac/JMB Hawaii,
Inc. (as predecessor to KLC Land).  Although such Senior Indebtedness and
COLA Notes were discharged under the Plan, the Guarantees of the Non-Debtor
KLC Subsidiaries were not.  Thus, to the extent that the holders of the
Senior Indebtedness and COLA Notes did not receive payment on the
outstanding balance thereof from distributions made under the Plan, the
remaining amounts due thereunder remain obligations of the Non-Debtor KLC
Subsidiaries under the Guarantees.  Under the Plan, the obligations of the
Non-Debtor KLC Subsidiaries under such Guarantees were assigned by the
holders of the Senior Indebtedness and COLA Notes to Kaanapali Land on the
Plan Effective Date.  Kaanapali Land has notified each of the Non-Debtor
KLC Subsidiaries that are liable under such Guarantees that their
respective guarantee obligations are due and owing and that Kaanapali Land
reserves all of its rights and remedies in such regard.  Given the
financial condition of such Non-Debtor Subsidiaries, however, it is
unlikely that Kaanapali Land will realize payments on such Guarantees that
are more than a small percentage of the total amounts outstanding
thereunder or that in the aggregate will generate any material proceeds to
the Company.  Nevertheless, Kaanapali Land intends to assert its claims in
the Chapter 7 bankruptcy proceeding of Oahu Sugar in order that it may
recover substantially all of the assets remaining in the bankruptcy estate,
if any, that become available for creditors of Oahu Sugar.  Any amounts so
received would not be material to the Company.  These Guarantee obligations
have been eliminated in the consolidated financial statements because the
obligors are consolidated subsidiaries of Kaanapali Land, which is now the
sole obligee thereunder.

     Those persons and entities that were not affiliated with Northbrook
and were holders of COLAs (Certificate of Land Appreciation Notes) on the
date that the Plan was confirmed by the Bankruptcy Court, and their
successors in interest, represent approximately 9.0% of the ownership of
the Company.

     At December 31, 2005, the Company had cash and cash equivalents of
approximately $52 million which is available for, among other things,
working capital requirements, including future operating expenses, and the
Company's obligations for engineering, planning, regulatory and development
costs including roadway construction, drainage and utilities, environmental
remediation costs on existing and former properties, the cost of
renovations of the golf course, potential tax liabilities resulting from
IRS audits, retiree medical insurance benefits for Pioneer Mill Company,
and existing and possible future litigation.

     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, although the material portion of such anticipated expenses are
not currently subject to any contractual commitments.  Reference is made to
Item 1 - Business, Item 3 - Legal Proceedings and the footnotes to the
financial statements.  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 ceased operations at the Waikele Golf Course effective
March 1, 2006 for approximately six months to allow for renovations of the
golf course greens and facilities.  The cost of renovations and the shut-
down of operations is not expected to have a material adverse effect on the
overall financial condition of the Company.



<PAGE>


      The Company's mortgage note payable as of December 31, 2004 was a
loan secured by the Waikele Golf Course.  The owner of the golf course
repaid the mortgage in full on March 1, 2005, with proceeds obtained
through a new mortgage loan granted by a subsidiary of Kaanapali Land in
the original principal amount of approximately $7.2 million.  The note has
been eliminated in the consolidated financial statements because the
obligor and maker are consolidated subsidiaries of Kaanapali Land.

     The Company's continuing operations have in recent periods been
primarily reliant upon the net proceeds of sales of developed and
undeveloped land parcels.  On January 20, 2005, the Company sold its mill
sites and associated lands on the Island of Kauai for approximately $1.3
million (before closing costs and prorations).  On June 21, 2005, the
Company closed the sale of Lot 3 for a base price of $22.5 million (before
closing costs and prorations).  On September 12, 2005, the Company received
$6 million pursuant to the purchase price adjustment agreement in
connection with the sale of Lot 3.

     During the first quarter of 2006, the Company received final
subdivision approval on an approximate 336 acre parcel in the region
"mauka" (toward the mountains) from the main Kaanapali 2020 area.  This
project, called Kaanapali Coffee Farms, consists of 58 agricultural lots
that are being offered to individual buyers.  The Company has begun
accepting reservations on certain of these lots which are expected to be
converted to contracts during the second quarter of 2006.  The Company
expects to begin closing on the lot sales and commence the land
improvements on the project during the second or third quarter of 2006.  It
is anticipated that the land improvements will be completed within an
approximate one year period.  In conjunction with the final approval, the
Company was required to obtain two subdivision bonds in the amounts of
approximately $18.6 million and $4.7 million and was required to secure the
bonds with a cash deposit of $8.3 million into an interest bearing
collateral account.  The funds will be withdrawn from the collateral
account by the Company upon completion of the subdivision improvements.
While construction contracts have not yet been entered into, it is expected
that on-site and off-site construction commitments will exceed the
aggregate of the two subdivision bonds.

     Although the Company does not currently believe that it has
significant liquidity problems over the near term, should the Company be
unable to satisfy its liquidity requirements from its existing resources,
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.

RESULTS OF OPERATIONS

     Reference is made to the footnotes to the financial statements for
additional discussion of items addressing comparability between years.

     2005 COMPARED TO 2004

     Cash and cash equivalents increased and property, net decreased in the
accompanying balance sheets due to the sale of Lot 3 during 2005 offset by
development costs incurred during the year and the deposit of cash into a
collateral deposit account to secure two subdivision bonds.

     Receivables, net increased due to refunds due for previous payments of
taxes and interest as a result of the recently concluded examination of the
2000 Federal tax return.

     Other assets increased primarily due to a cash deposit into an
interest bearing collateral account to secure two subdivision bonds
relating to the Kaanapali Coffee Farms project.

     The accumulated post-retirement benefit obligation decreased primarily
due to the recognition of the effect of ending the retiree medical and life
insurance coverage for all active employees.



<PAGE>


     Other liabilities and selling, general and administrative expenses,
decreased primarily due to the reduction of certain reserves related to
contingencies which originated in prior years and were resolved in 2005.

     Mortgage note payable and interest decreased due to the repayment of
the Waikele Golf Course mortgage in full during the first quarter of 2005.

     The increase in sales and cost of sales is primarily due to the sale
of the mill sites and associated lands on the Island of Kauai and the sale
of Lot 3 during 2005.

     The decrease in the reduction of post-retirement benefit obligations
was due to the effect of the expected termination of most of the post-
retirement obligations at the end of 2004.

     The decrease in income tax expense is a result of utilization of
deferred tax assets that had previously been subject to a valuation
allowance.

     2004 COMPARED TO 2003

     Cash and cash equivalents increased and notes receivable, net
decreased in the accompanying balance sheets due to the collection of the
notes receivable during 2004 which were received in the sales of Lots 2 and
4 during 2003.

     The accumulated post-retirement benefit obligation decreased due in
part to benefits paid but primarily due to the effect of the termination of
most of the post-retirement obligations.  Such reductions have been
reflected as reduction of post-retirement benefit obligation in the
Consolidated Statement of Operations.

     Other liabilities decreased primarily due to the Company's payment to
the U.S. Treasury as a result of the IRS' examination and resulting tax
adjustments related to the Company's Federal tax returns for 1998 and 1999.

The decrease is also a result of the settlement of certain personal injury
actions and the reduction of certain reserves related to obligations
resulting from the sales of properties in prior years which have been
completed.

     Mortgage payable decreased in the accompanying balance sheets due to
the debt modification agreement reached with the lender of the Waikele Golf
Course.  In conjunction with the loan modification, a principal payment of
$1 million was made to the lender to decrease the outstanding principal
balance of the note.

     The decrease in sales and cost of sales is primarily due to the sale
of Lot 2, the sale of Lot 4, and the sale of Parcel 22/23 during 2003.

     Selling, general and administrative expense decreased primarily as a
result of the recovery from an insurance company of amounts previously
expensed by D/C relating to the defense of certain liability claims, a
decrease in legal fees incurred during 2004 as a result of the settlement
of various litigation matters during 2003 and a reduction in payroll
related costs as a result of the reduction in personnel in 2004.

     Interest decreased due to the settlement with a lender which resulted
in the Company being released from its obligations under a mortgage
indebtedness in December 2003.  The decrease is also due to a lower
interest rate on the mortgage payable secured by the Waikele Golf Course
during the second half of 2004 as a result of the loan modification with
the lender effective June 1, 2004, offset by interest paid for federal
income taxes.

     The reduction to carrying value of investments for the year ended
December 31, 2004 represents impairment losses recognized to reduce the
carrying value of certain land parcels and leasehold improvements which are
not considered to be part of the Company's Kaanapali 2020 development plan.



<PAGE>


     The decrease in income tax expense is a result of the decrease in the
Company's income from continuing operations as well as an increase in the
deferred tax asset valuation allowance.


INFLATION

     Due to the lack of significant fluctuations in the level of inflation
in recent years, inflation generally has not had a material effect on real
estate development.

     In the future, high rates of inflation may 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 can 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 real property sales, subject to general economic
conditions affecting the real estate industry and local market factors, and
therefore may be advantageous where property investments are not highly
leveraged with debt or where the cost of such debt has been previously
fixed.

     At December 31, 2005, the Company's only known material contractual
obligations is approximately $3.2 million for the demolition of the sugar
mill buildings on the Pioneer Mill site.


CRITICAL 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 and
judgements 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 judgements
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 Company reviews its property for impairment of value.  This
includes considering certain indications 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.

     There are various judgments and uncertainties affecting the
application of these and other accounting policies, including the
liabilities related to asserted and unasserted claims and the utilization
of net operating losses.  Materially different amounts may be reported
under different circumstances or if different assumptions were used.




<PAGE>


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 prevalent 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 debt payments, capital
expenditures and other cash requirements.  Prior to the filing of the
Reorganization Case, the Company's primary risk exposure had been to
interest rate risk.  The Company does not enter into financial instruments
for trading purposes.

     The Company's debt arrangement at December 31, 2004 was at a variable
rate.  Based upon the Company's indebtedness and interest rates at
December 31, 2004, a 1% increase in market rates or a 1% decrease in market
rates would have had no significant effect on future earnings and cash
flows.  The Company's debt was repaid during 2005.


<PAGE>


ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA


                            KAANAPALI LAND, LLC

                                   INDEX


Report of Independent Registered Public Accounting Firm

Consolidated Balance Sheets, December 31, 2005 and 2004

Consolidated Statements of Operations for the years ended
  December 31, 2005, 2004 and 2003

Consolidated Statements of Stockholders' Equity (Deficit) for
  the years ended December 31, 2005, 2004 and 2003

Consolidated Statements of Cash Flows for the years ended
  December 31, 2005, 2004 and 2003

Notes to Consolidated Financial Statements



Schedules not filed:

     All schedules have been omitted as the required information is
inapplicable or the information is presented in the financial statements or
related notes.





<PAGE>





          REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM



The Managing Member and Stockholders
Kaanapali Land, LLC


We have audited the accompanying consolidated balance sheets of Kaanapali
Land, LLC as of December 31, 2005 and 2004, and the related consolidated
statements of operations, stockholders' equity (deficit), and cash flows
for each of the three years in the period ended December 31, 2005.  These
financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements
based on our audits.

We conducted our audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States).  Those standards
require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement.
We were not engaged to perform an audit of the Company's internal control
over financial reporting.  Our audits included consideration of internal
control over financial reporting as a basis for designing audit procedures
that are appropriate in the circumstances, 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.

An audit also includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation.  We believe
that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Kaanapali
Land, LLC at December 31, 2005 and 2004, and the consolidated results of
its operations and its cash flows for each of the three years in the period
ended December 31, 2005, in conformity with U.S. generally accepted
accounting principles.






                                        /s/ Ernst & Young LLP




Chicago, Illinois
March 24, 2006






<PAGE>


                            KAANAPALI LAND, LLC

                        Consolidated Balance Sheets

                        December 31, 2005 and 2004
                 (Dollars in Thousands, except share data)


                                A S S E T S
                                -----------
                                                       2005      2004
                                                     --------  --------

Cash and cash equivalents. . . . . . . . . . . . .   $ 51,677    45,744
Receivables, net . . . . . . . . . . . . . . . . .      4,735       445
Property, net. . . . . . . . . . . . . . . . . . .     92,322   104,036
Prepaid pension costs. . . . . . . . . . . . . . .     27,473    26,630
Other assets . . . . . . . . . . . . . . . . . . .     11,668     2,546
                                                     --------  --------
                                                     $187,875   179,401
                                                     ========  ========


                           L I A B I L I T I E S
                           ---------------------

Accounts payable and accrued expenses. . . . . . .   $  1,351     1,647
Deferred income taxes. . . . . . . . . . . . . . .     28,197    25,120
Accumulated post-retirement benefit obligation . .      2,716     3,267
Other liabilities. . . . . . . . . . . . . . . . .     36,551    44,171
Mortgage note payable. . . . . . . . . . . . . . .      --        7,178
                                                     --------  --------
        Total liabilities. . . . . . . . . . . . .     68,815    81,383

Commitments and contingencies


                   S T O C K H O L D E R S'  E Q U I T Y
                   -------------------------------------

Common stock, at 12/31/05 and 12/31/04 non par
  value shares authorized - 4,500,000; shares
  issued 1,792,613 . . . . . . . . . . . . . . . .      --        --
Additional paid-in capital . . . . . . . . . . . .      5,357     5,357
Accumulated earnings . . . . . . . . . . . . . . .    113,703    92,661
                                                     --------  --------

        Total stockholders' equity . . . . . . . .    119,060    98,018
                                                     --------  --------

                                                     $187,875   179,401
                                                     ========  ========















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


<PAGE>


                            KAANAPALI LAND, LLC

                   Consolidated Statements of Operations

               Years ended December 31, 2005, 2004 and 2003
              (Dollars in Thousands Except Per Share Amounts)

                                            2005       2004      2003
                                          --------   --------  --------
Revenues:
  Sales. . . . . . . . . . . . . . . . .  $ 34,988     10,793    59,178
  Interest and other income. . . . . . .     2,263      3,123     4,605
                                          --------   --------  --------
                                            37,251     13,916    63,783
                                          --------   --------  --------
Cost and expenses:
  Cost of sales. . . . . . . . . . . . .    17,213      2,693    39,564
  Reduction of post-retirement
    benefit obligation . . . . . . . . .      (206)    (8,860)   (7,679)
  Selling, general and administrative. .    (5,083)     6,256     8,475
  Interest . . . . . . . . . . . . . . .       168        743     1,129
  Depreciation and amortization. . . . .     1,040      1,136     1,164
  Reduction to carrying value of
    investments. . . . . . . . . . . . .     --         1,310     --
                                          --------   --------  --------
                                            13,132      3,278    42,653
                                          --------   --------  --------
Operating income (loss). . . . . . . . .    24,119     10,638    21,130

  Equity in income (loss) from
    unconsolidated investments . . . . .     --         --         (402)
                                          --------   --------  --------
  Income (loss) from continuing
    operations before income taxes,
    and gain on disposition of
    unconsolidated investment. . . . . .    24,119     10,638    20,728
  Income tax (expense) benefit . . . . .    (3,077)    (5,751)  (10,226)
                                          --------   --------  --------
  Income (loss) from continuing
    operations . . . . . . . . . . . . .    21,042      4,887    10,502
  Gain on disposition of
    unconsolidated investment. . . . . .     --         --       60,134
                                          --------   --------  --------
        Net income (loss). . . . . . . .  $ 21,042      4,887    70,636
                                          ========   ========  ========
Earnings per share:
  Income (loss) from continuing
    operations, basic and diluted. . . .  $  11.74       2.73      5.86
                                          ========   ========  ========
  Net income (loss), basic and
    diluted. . . . . . . . . . . . . . .  $  11.74       2.73     39.44
                                          ========   ========  ========















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


<PAGE>


                            KAANAPALI LAND, LLC

         Consolidated Statements of Stockholders' Equity (Deficit)

               Years ended December 31, 2005, 2004 and 2003
                          (Dollars in Thousands)


                                                                Total
                                                 Accumu-        Stock-
                                  Additional     lated          holders'
                      Common       Paid-In       (Deficit)      Equity
                      Stock        Capital       Earnings      (Deficit)
                     --------     ---------      --------      --------

Balance at
  December 31,
  2002 . . . . . .   $    --          5,357        17,138        22,495

Net income . . . .        --          --           70,636        70,636
                     --------      --------      --------      --------
Balance at
  December 31,
  2003 . . . . . .        --          5,357        87,774        93,131

Net income . . . .        --          --            4,887         4,887
                     --------      --------      --------      --------
Balance at
  December 31,
  2004 . . . . . .        --          5,357        92,661        98,018

Net income . . . .        --          --           21,042        21,042
                     --------      --------      --------      --------
Balance at
  December 31,
  2005 . . . . . .   $    --          5,357       113,703       119,060
                     ========      ========      ========      ========






























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


<PAGE>


                            KAANAPALI LAND, LLC

                   Consolidated Statements of Cash Flows

               Years ended December 31, 2005, 2004 and 2003
                          (Dollars in Thousands)


                                            2005       2004      2003
                                          --------   --------  --------
Cash flows from operating activities:
  Net income (loss). . . . . . . . . . .  $ 21,042      4,887    70,636
  Adjustments to reconcile net income
   (loss) to net cash provided by
   (used in) continuing operations:
    Property sales, disposals and
      retirements, net . . . . . . . . .    13,825     (4,113)    8,337
    Gain on disposition of uncon-
      solidated investment . . . . . . .     --         --      (60,134)
    Depreciation and amortization. . . .     1,040      1,136     1,164
    Equity in loss (income) from
      unconsolidated investments . . . .     --         --          402
    Reduction to carrying value of
      investments. . . . . . . . . . . .     --           695     --
  Changes in operating assets and
   liabilities:
    Receivables, net . . . . . . . . . .    (4,290)       332     1,118
    Prepaid pension costs. . . . . . . .      (935)      (549)   (1,216)
    Accumulated post-retirement
      benefit obligation . . . . . . . .      (551)   (10,476)   (9,817)
    Collateral deposit . . . . . . . . .    (8,333)     --        --
    Accounts payable, accrued expenses
      and other. . . . . . . . . . . . .    (8,613)    (9,117)   (6,015)
    Deferred income taxes. . . . . . . .     3,077      5,751    10,226
                                          --------   --------  --------
Net cash provided by (used in)
  operating activities . . . . . . . . .    16,262    (11,454)   14,701
                                          --------   --------  --------

Cash flows from investing activities:
  Property additions . . . . . . . . . .    (3,151)    (2,053)   (1,190)
  Distributions from (contributions to)
    investments in unconsolidated
    entities, at equity, net . . . . . .     --         --         (254)
  Proceeds from notes receivable . . . .     --        31,366     --
                                          --------   --------  --------
Net cash provided by (used in)
  investing activities . . . . . . . . .    (3,151)    29,313    (1,444)
                                          --------   --------  --------



<PAGE>


                            KAANAPALI LAND, LLC

             Consolidated Statements of Cash Flows - Continued

               Years ended December 31, 2005, 2004 and 2003
                          (Dollars in Thousands)


                                            2005       2004      2003
                                          --------   --------  --------
Cash flows from financing activities:
  Net repayments of debt . . . . . . . .    (7,178)    (1,110)     (110)
                                          --------   --------  --------
        Cash used in
          financing activities . . . . .    (7,178)    (1,110)     (110)
                                          --------   --------  --------
        Net increase (decrease) in
          cash and cash equivalents. . .     5,933     16,749    13,147

        Cash and cash equivalents
          at beginning of year . . . . .    45,744     28,995    15,848
                                          --------   --------  --------
        Cash and cash equivalents
          at end of year . . . . . . . .  $ 51,677     45,744    28,995
                                          ========   ========  ========

Supplemental disclosure of cash flow
 information:
  Cash paid for interest from
    continuing operations. . . . . . . .  $    168        743       643
                                          ========   ========  ========

  Cash received (paid) for
    income taxes . . . . . . . . . . . .  $  --        (4,100)    --
                                          ========   ========  ========

Non-cash investing and financing
 activities:
  Note receivable received in sale
    of Lot 2 . . . . . . . . . . . . . .  $  --         --       14,366
  Deferred gain. . . . . . . . . . . . .     --         --       (5,308)
                                          --------   --------  --------
                                             --         --        9,058
  Note receivable received in sale
    of Lot 4 . . . . . . . . . . . . . .     --         --       17,000
                                          --------   --------  --------
  Note receivable, net . . . . . . . . .  $  --         --       26,058
                                          ========   ========  ========



















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


<PAGE>


                            KAANAPALI LAND, LLC

                Notes to Consolidated Financial Statements

                          (Dollars in Thousands)


(1)  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     ORGANIZATION AND BASIS OF ACCOUNTING

     Kaanapali Land, LLC ("Kaanapali Land"), 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) 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 Debtors had
filed their petition for reorganization under Chapter 11 on February 27,
2002 (the "Petition Date") in the United States Bankruptcy Court for the
Northern District of Illinois, Eastern Division (the "Bankruptcy Court")
which petitions were consolidated into a single joint proceeding by the
Bankruptcy Court (the "Reorganization Case").

     The principal goal of the Plan was to address the Debtors' debt
burdens so that the Debtors could emerge from Chapter 11 with a viable
capital structure and with the resources necessary to operate their land
development business.  The Plan achieved this goal by converting certain
indebtedness and other liabilities of the Debtors into new equity of
Kaanapali Land (to the extent such creditors did not elect an available
cash distribution option).  Another goal of the Plan was to secure
additional liquidity for the Debtors to help fund future operations.  The
Plan achieved this goal through the Merger of Northbrook Corporation
("Northbrook") into FHTC and the subsequent merger of FHTC into Kaanapali
Land, which made the assets and liquidity of Northbrook available to the
Debtors to help fund their land development business.

     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").  After the Plan
Effective Date, Kaanapali Land continued to implement the restructuring
transactions that were contemplated to be effected under the Plan,
including, among other things, the resolution of all outstanding claims and
distributions on all claims that were allowed under the Plan.  On
August 31, 2005, pursuant to a motion for entry of final decree, the
bankruptcy cases were closed.

     In accordance with the Plan, a maximum of 1,863,000 shares of
Kaanapali Land were issuable.  At December 31, 2005, approximately
1,793,000 shares were issued and outstanding and Kaanapali Land believes
that no further shares will be issued under the Plan.



<PAGE>


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

     The Company's continuing operations are in three business segments -
agriculture, property and golf.  The Agriculture segment grows seed corn
and soybeans under contract and leases land currently cultivated in coffee
to a third party, while maintaining additional coffee acreage for possible
future use.  The Property segment primarily develops land for sale and
negotiates bulk sales of undeveloped land.  The Golf segment is responsible
for the management and operation of the Waikele Golf Course.  The Property,
Agriculture and Golf segments operate exclusively in the State of Hawaii.
For further information on the Company's business segments see Note 9.

     STATEMENT OF CASH FLOWS

     The Company considers as cash equivalents all investments with
maturities of three months or less when purchased.

     FAIR VALUE OF FINANCIAL INSTRUMENTS

     Statement of Financial Accounting Standards No. 107 ("SFAS No. 107"),
"Disclosures about Fair Value of Financial Instruments", requires entities
to disclose the SFAS No. 107 value of certain on and off balance sheet
financial instruments for which it is practicable to estimate. Value is
defined in SFAS No. 107 as the amount at which the instrument could be
exchanged in a current transaction between willing parties, other than in a
forced or liquidation sale.  The Company believes the carrying amounts of
its financial instruments on its balance sheet approximate fair value due
to the relatively short maturity of these instruments.  The Company
believes the carrying value of its debt (see Note 3) approximates fair
value.

     RECEIVABLES

     The allowance for doubtful receivables was $53 and $1,476 at
December 31, 2005 and 2004, respectively.

     LAND DEVELOPMENT

     During the first quarter of 2006, the Company received final
subdivision approval on an approximate 336 acre parcel in the region
"mauka" (toward the mountains) from the main Kaanapali 2020 area.  This
project, called Kaanapali Coffee Farms, consists of 58 agricultural lots
that are being offered to individual buyers.  The Company has begun
accepting reservations on certain of these lots.  In conjunction with the
final approval, the Company was required to obtain two subdivision bonds in
the amounts of approximately $18.6 million and $4.7 million and was
required to secure the bonds with a cash deposit of $8.3 million into an
interest bearing collateral account.  The funds will be withdrawn from the
collateral account by the Company upon completion of the subdivision
improvements.

     Project costs associated with the development and construction of real
estate projects are capitalized and classified as Property.  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.  No interest, insurance or property
tax has been capitalized for the periods presented.



<PAGE>


     RECOGNITION OF PROFIT FROM REAL PROPERTY SALES

     For real property sales, profit is recognized in full when the
collectibility of the sales price is reasonably assured and the earnings
process is virtually complete.  When the sale does not meet the
requirements for full profit recognition, a portion of the profit is
deferred until such requirements are met.

     PROPERTY

     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, or the lease term if less.  At December 31, 2005, the Company
held approximately $1,900 of non-depreciable land improvements and
approximately $3,300 of depreciable land improvements, relating principally
to the Waikele Golf Course, which are being depreciated over their
estimated 15-year useful life.  Maintenance and repairs are charged to
operations as incurred.  Significant betterments and improvements are
capitalized and depreciated over their estimated useful lives.

     In 2004, the Company recognized an impairment loss of $1,310.  The
2004 impairment loss was primarily to reduce the carrying value of certain
land parcels and leasehold improvements.  The land parcels were not
considered to be part of future development plans as such land parcels are
not part of the Company's Kaanapali 2020 development plan.

     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 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.

                                                   2005          2004
                                                 --------      --------

  Property, net:
    Land . . . . . . . . . . . . . . . . . .     $ 74,412        89,833
    Land improvements. . . . . . . . . . . .        1,886         4,658
    Buildings. . . . . . . . . . . . . . . .       18,490        19,766
    Machinery and equipment. . . . . . . . .        4,022        12,947
                                                 --------      --------
                                                   98,810       127,204
    Accumulated depreciation . . . . . . . .       (6,488)      (23,168)
                                                 --------      --------
    Property, net. . . . . . . . . . . . . .     $ 92,322       104,036
                                                 ========      ========

     Land held for sale of approximately $14,000, none of which had any
current operations, was included in Property in the consolidated balance
sheets at December 31, 2004 and was carried at the lower of cost or fair
value less cost to sell.  Such land was sold during 2005.  No land is
currently in use except for the land associated with the Waikele Golf
Course (carrying value of approximately $8,000 at December 31, 2005),
certain Kaanapali 2020 land that has been set aside for the Company's seed
corn and soybean operations and certain acreage of coffee trees that have
been leased to a third party plus additional coffee acreage being
maintained to support the Company's land development program.



<PAGE>


    The Company's principal property holdings are on the island of Maui
(including approximately 4,000 acres known as Kaanapali 2020, of which
approximately 1,500 acres is classified as conservation land which
precludes development) and have a carrying value of approximately $65,000.
In addition, the Company's property holdings on the island of Oahu have a
carrying value of approximately $27,000.  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 disposition thereof.

     The Company ceased operations at the golf course effective March 1,
2006 for approximately six months to allow for renovations of the golf
course greens and facilities.  The assets and operations of the Waikele
Golf Course represent all of the golf segment for purposes of business
segment information.  The cost of the renovations and the shut-down of the
course is not expected to have a material adverse effect on the overall
financial condition of the Company.

     LAND SALES AND MORTGAGES RECEIVABLE

     On January 20, 2005, the Company sold its mill sites and associated
lands on the Island of Kauai for approximately $1,300 before closing costs
and prorations.

     On June 21, 2005, the Company closed the sale of Lot 3 for a base
purchase price of $22,500, pursuant to an option that the purchaser of
Lot 4 (a parcel which is contiguous to Lot 3 and sold by the Company in
2003) held on the property.  The purchase price was paid in cash (before
closing costs and prorations) at closing.  Pursuant to a purchase price
adjustment agreement entered into at closing as required in the option
agreement, the purchase price was subject to potential increase under
certain circumstances.

     The purchaser's performance of its obligations under the purchase
price adjustment agreement was secured by a mortgage in favor of Lot 3 and
covering the property, which was filed at closing.  On September 12, 2005,
the Company received $6,000 pursuant to the purchase price adjustment
agreement and the mortgage was released.

     On January 31, 2003, an option to purchase Lot 2 (an approximate 11.5
acre site in the North Beach area of Kaanapali) was exercised.  A non-
refundable payment was made for $2,000 (before closing costs and
prorations).  The remainder of the purchase price was reflected by a note
secured by a mortgage due and paid in March 2004 for approximately $14,000.

     The Company recorded the sale under the cost recovery method of
accounting.  The full note was recorded, offset by the entire deferred gain
of approximately $5,308 at December 31, 2003.  The deferred gain was
recognized during 2004 based upon the anticipated number of units approved
for construction on the site.

     On August 5, 2003, the Company closed the sale of Lot 4 (an
approximate 40 acre site in the North Beach area of Kaanapali) for a
purchase price of $33,000.  The cash portion of the purchase price (before
closing costs and prorations) of $16,000 was paid at closing and the
balance was delivered in the form of a promissory note in the original
principal amount of $17,000.  The promissory note was paid in December
2004.  The promissory note was secured by a first mortgage encumbering
Lot 4, and bore interest at the rate of 8% per annum.  Interest payments
were paid monthly.  The Company recognized approximately $13,000 of gain
related to this transaction for financial reporting purposes during the
third quarter of 2003.



<PAGE>


     In December 2003, the Company closed on its sale of Parcel 22/23 to a
third party for a purchase price of $12,500.  Approximately $11,500 was
received in cash at closing and the Company deposited approximately $1,000
into an escrow account.  The Company recognized a gain of approximately
$4,000 related to the transaction for financial reporting purposes in 2003.

In conjunction with the sale, the Company has agreed to pay a portion of
the cost of certain roadway improvements and pay the costs of the design
and construction of an underground sewer line and drainage construction as
well as the cost of certain other improvements.  Such escrowed funds will
fund the Company's portion of the costs associated with the road
improvements and the sewer and drainage construction costs.  The Company is
responsible for certain costs in excess of the escrowed funds associated
with the road improvements and sewer and drainage construction costs and
has accrued approximately $1,000 in excess of the amount escrowed as an
estimate of such costs.

     OTHER LIABILITIES

     Other liabilities includes project completion costs on land sold in
prior years, reserves for losses on divested segments, reserves for
workmen's compensation and general liability claims, and reserves for
commitments and contingencies as discussed in Note 8, including potential
tax liabilities.

     USE OF ESTIMATES

     The preparation of financial statements in conformity with accounting
principles generally accepted in the United States 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.

     RECLASSIFICATIONS

     Certain amounts in the 2004 and 2003 consolidated financial statements
have been reclassified to conform to the 2005 presentation.


(2)  INVESTMENTS

      The Company owned approximately 16.67% of Amfac Property Investment
Corp. ("APIC"), which owned and operated the Royal Kaanapali Golf Courses
("RKGC") prior to the consummation of the settlement agreement with its
lender.  The remaining approximately 83.33% of the shares of APIC are owned
by AF Investors, LLC ("AF Investors") which is a subsidiary of Amfac
Finance Limited Partnership ("AFLP").

     In December 2002, AFLP redeemed the interest held by Kaanapali Land
(as successor to Northbrook) for approximately $60.  Kaanapali Land
remained obligated under certain circumstances to fund costs related to,
among other things, golf course improvements required under the settlement
agreement with the lender.  A portion of these funding obligations was
anticipated to be reimbursed by AFLP under the Funding Agreement entered
into by Kaanapali Land, AFLP and certain other affiliated entities in
October 2002.  Subsequently, due to adverse developments in certain
litigation, the expected source of funds to AFLP to make such repayments
became impaired and it became doubtful that the Company would receive any
meaningful portion of the amounts that were previously expected to be
reimbursed under the Funding Agreement.  The Company continued to record
its investment in unconsolidated entities due to its funding obligations
and because the Company was awaiting final consummation of the settlement
agreement with the lender.  The agreement was consummated on September 9,
2003, and as a consequence, the Company recorded a gain on disposition of
its investment of approximately $60,134 for financial reporting purposes
which represented the extent of the amount recorded as investment in
unconsolidated entities.



<PAGE>


(3)  MORTGAGE NOTE PAYABLE

      The Waikele Golf Course mortgage note payable, secured by the Waikele
Golf Course, had an outstanding principal balance of $7,178 at December 31,
2004.  The loan had certain cash flow and other financial covenants.

      Effective June 1, 2004, the debt was modified pursuant to a loan
modification agreement with the lender.  In accordance with the agreement,
a $1,000 principal payment was made to the lender to reduce the outstanding
principal balance of the note, the interest rate was modified to LIBOR plus
4.25% with no LIBOR floor (6.43% at December 31, 2004), and the debt was
extended to mature on December 1, 2011.  The loan continued to have certain
cash flow and other financial covenants.  Waikele Golf Course, LLC repaid
the mortgage in full on March 1, 2005, with proceeds obtained through a new
mortgage loan granted by a subsidiary of Kaanapali Land in the original
principal amount of $7,178.  Interest on the principal balance accrues at
an adjustable rate of prime plus 1%.  The principal and accrued interest
are due March 1, 2015.  The note, which is prepayable, is secured by the
Waikele Golf Course.  The note has been eliminated in the consolidated
financial statements because the obligor and maker are consolidated
subsidiaries of Kaanapali Land.


(4)  RENTAL ARRANGEMENTS

     The Company has rented, as lessee, various land, facilities and
equipment under operating leases. Most land leases provided for renewal
options and minimum rentals plus contingent payments based on revenues or
profits. The Company has formerly been involved in various sandwich leases
for land.

     The Company leases various office spaces with average annual rental of
approximately $150 per year.  Leases expire at various times in 2006 and
are not expected to be renewed beyond the end of 2006.  Although the
Company was a party to certain other leasing arrangements, none of them
were material.


(5)  EMPLOYEE BENEFIT PLANS

     (a)  PENSION PLANS

     As of December 31, 2005, the Company participates in a defined benefit
pension plan that covers substantially all its eligible employees.  The
Plan is sponsored and maintained by Kaanapali Land in conjunction with
other plans providing benefits to employees of Kaanapali Land and its
affiliates.  The Pension Plan for Bargaining Unit Employees of Amfac
Plantations (the "Pension Plan") provides benefits based primarily on
length of service and career-average compensation levels.  Accordingly,
there is no difference between the accumulated benefit obligation and the
projected benefit obligation.  Kaanapali Land's policy is to fund pension
costs in accordance with the minimum funding requirements under provisions
of the Employee Retirement Income Security Act ("ERISA").  Under such
guidelines, amounts funded may be more or less than the pension expense or
credit recognized for financial reporting purposes.



<PAGE>


     The following tables summarize the components of the funded status of
the Company's defined benefit pension plan at December 31, 2005 and 2004,
the net pension credit for 2005, 2004 and 2003, and major assumptions used
to determine these amounts.

                                                       2005       2004
                                                      -------   -------

  Benefit obligation at beginning of year. . . . . .  $44,992    44,922
  Service cost . . . . . . . . . . . . . . . . . . .       28        62
  Interest cost. . . . . . . . . . . . . . . . . . .    2,573     2,695
  Actuarial loss . . . . . . . . . . . . . . . . . .    3,007     1,928
  Benefits paid. . . . . . . . . . . . . . . . . . .   (4,534)   (4,615)
                                                      -------   -------
  Benefit obligation at end of year. . . . . . . . .   46,066    44,992
                                                      -------   -------

  Fair value of plan assets at beginning of year . .   71,956    67,870
  Actual return on plan assets . . . . . . . . . . .    5,073     8,701
  Benefits paid. . . . . . . . . . . . . . . . . . .   (4,534)   (4,615)
                                                      -------   -------
  Fair value of plan assets at end of year . . . . .   72,495    71,956
                                                      -------   -------

  Funded status. . . . . . . . . . . . . . . . . . .   26,429    26,964
  Unrecognized net actuarial (gain) loss . . . . . .    1,035      (344)
  Unrecognized prior service cost. . . . . . . . . .        9        10
                                                      -------   -------
  Prepaid pension cost . . . . . . . . . . . . . . .  $27,473    26,630
                                                      =======   =======

     Unrecognized net gains or losses are amortized over a ten year period.

At December 31, 2005, approximately 49% of the plan's assets are invested
in equity securities, 20% in fixed income funds and 31% in alternative
strategies.

      The components of the net periodic pension benefit (credit) for the
years ended December 31, 2005, 2004 and 2003 (which are reflected as
selling, general and administrative in the consolidated statements of
operations) are as follows:

                                              2005      2004      2003
                                            -------   -------   -------

  Service cost . . . . . . . . . . . . . .  $    28        62        65
  Interest cost. . . . . . . . . . . . . .    2,573     2,695     2,939
  Expected return on plan assets . . . . .   (4,367)   (4,266)   (4,647)
  Recognized net actuarial (gain)
    loss . . . . . . . . . . . . . . . . .      922       867       154
  Amortization of prior service cost . . .        1         1         1
  Special termination benefit. . . . . . .    --        --        1,404
                                            -------   -------   -------

  Net periodic pension credit. . . . . . .  $  (843)     (641)      (84)
                                            =======   =======   =======



<PAGE>


     The principal assumptions used to determine the net periodic pension
benefit (credit) and the actuarial value of the accumulated benefit
obligation were as follows:

  As of January 1,                            2005      2004      2003
  ----------------                          -------   -------   -------

  Discount rate. . . . . . . . . . . . . .     5.9%     6.25%      7.0%
                                            =======   =======   =======

  Rates of compensation increase . . . . .       3%        3%        3%

  Expected long-term rate of return
    on assets. . . . . . . . . . . . . . .     7.0%      7.0%      7.0%
                                            =======   =======   =======

  As of December 31,                          2005      2004      2003
  ------------------                        -------   -------   -------

  Discount rate. . . . . . . . . . . . . .     5.9%      5.9%     6.25%
                                            =======   =======   =======

  Rates of compensation increase . . . . .       3%        3%        3%
                                            =======   =======   =======

  Expected long-term rate of return
    on assets. . . . . . . . . . . . . . .     7.0%      7.0%      7.0%
                                            =======   =======   =======

     The above long-term rates of return were selected based on historical
asset returns and expectations of future returns.

     The measurement date is December 31, the last day of the corporate
fiscal year.  The accumulated benefit obligation at December 31, 2005 and
2004 equals approximately $46,000 and $45,000, respectively.

     A comparison of the market value of the Pension Plan's net assets with
the present value of the benefit obligations indicates the Company's
ability at a point in time to pay future benefits.  The fair value of the
Pension Plan's assets available for benefits will fluctuate and certain
future obligations of the Pension Plan may be subject to bargaining unit
agreements.

     There was no contribution required in 2005 to the pension plan.
Furthermore, due to ERISA full funding limits, no contribution, whether
required or discretionary, could be made and deducted on the corporation's
tax return for the current fiscal year.

     The Company's target asset allocations reflect the Company's
investment strategy of maximizing the rate of return on plan assets and the
resulting funded status, within an appropriate level of risk.  Plan assets
are reviewed and, if necessary, rebalanced in accordance with target
allocation levels once every three months.



<PAGE>


     (b)  RETIREE HEALTH AND LIFE INSURANCE BENEFITS

     In addition to providing pension benefits, a subsidiary of KLC Land
currently provides certain healthcare and life insurance benefits to
certain eligible retired employees.  The postretirement life insurance plan
is non-contributory.

     Other entities continued funding their post-retirement health care
obligations until the end of 2004, which was a date on or after the date
when its required cost maintenance period as defined under Internal Revenue
Code Section 420 expired.  Retiree medical benefits for these entities
terminated at the end of 2004.  Most post-retirement life insurance
benefits were terminated effective at the end of 2003.  Kaanapali Land has
not assumed any obligation to fund the cost of these benefits on behalf of
any of its affiliates.

     For measuring the expected postretirement benefit obligation, an 11%
annual rate of increase in the per capita claims cost was assumed through
2005. The healthcare cost trend rate assumption currently has a minimal
effect on the amount of the obligation and periodic cost reported. An
increase (decrease) in the assumed healthcare trend rate by 1% in 2005
would increase (decrease) the medical plans' accumulated postretirement
benefit obligation as of December 31, 2005 by $1 and $(1), respectively,
and the aggregate of the service and interest cost components of net
periodic postretirement benefit cost for the year then ended by $3 and
$(3), respectively.

    Net periodic postretirement benefit credit for 2005, 2004 and 2003
includes the following components:

                                          2005        2004      2003
                                          Total       Total     Total
                                         -------     -------   -------

Service cost . . . . . . . . . . . .     $    19          12         1
Interest cost. . . . . . . . . . . .         167         284       550
Amortization of net gain . . . . . .         (53)     (8,208)   (7,777)
Recognized settlement gain . . . . .        (339)       (948)     (499)
                                         -------     -------   -------
Net periodic postretirement
  benefit credit . . . . . . . . . .     $  (206)     (8,860)   (7,725)
                                         =======     =======   =======

     The following table sets forth the plans' change in benefit obligation
and benefit cost as of December 31, 2005 and 2004 as follows:

                                           December 31,   December 31,
                                               2005           2004
                                           ------------   ------------

Benefit obligation at beginning of year.        $ 3,003          5,343
Service cost . . . . . . . . . . . . . .             19             12
Interest cost. . . . . . . . . . . . . .            167            284
Actuarial losses (gain). . . . . . . . .            (32)           (72)
Employer contribution. . . . . . . . . .           (345)        (1,616)
Settlement . . . . . . . . . . . . . . .           (339)          (948)
                                                -------        -------
Benefit obligation at end of year. . . .          2,473          3,003
Unrecognized net actuarial gain. . . . .            243            264
                                                -------        -------
Accumulated postretirement benefit cost.        $ 2,716          3,267
                                                =======        =======

     The subsidiary's expected contributions for 2006 through 2010 are
approximately $300 for each year of the five year period.



<PAGE>


     The subsidiary continuing to provide benefits currently amortizes
unrecognized gains over the shorter of ten years or the average life
expectancy of the inactive participants since almost all of the Plans'
participants are inactive.  The portion of the unrecognized net actuarial
gain represented by the decrease in the Maintenance of Effort obligation
was being amortized over four years, commencing in 2001.

      The weighted-average discount rate used in determining the
accumulated postretirement benefit obligation was 5.65% as of December 31,
2005 and 5.90% as of December 31, 2004.

     The calculation of the accumulated postretirement benefit cost or the
net periodic postretirement benefit cost does not reflect the effects of
the Medicare Prescription Drug Improvement and Modernization Act of 2003
(the "Act").

     The Company maintains a nonqualified deferred compensation arrangement
(the "Rabbi Trust") which provides certain former directors of Amfac and
their spouses with pension benefits.  The Rabbi Trust invests in marketable
securities and cash equivalents.  The deferred compensation liability
represented in the Rabbi Trust and assets funding such deferred
compensation liability are consolidated in the Company's balance sheet.


(6)  INCOME TAXES

     Income tax expense attributable to income from continuing operations
for the years ended December 31, 2005, 2004 and 2003 consists of:

                                       Current     Deferred     Total
                                       --------    --------    --------
     Year ended December 31, 2005:
       U.S. federal. . . . . . . . .   $  --          2,762       2,762
       State . . . . . . . . . . . .      --            315         315
                                       --------    --------    --------
                                       $  --          3,077       3,077
                                       ========    ========    ========
     Year ended December 31, 2004:
       U.S. federal. . . . . . . . .   $  --          5,161       5,161
       State . . . . . . . . . . . .      --            590         590
                                       --------    --------    --------
                                       $  --          5,751       5,751
                                       ========    ========    ========
     Year ended December 31, 2003:
       U.S. federal. . . . . . . . .   $  --          9,177       9,177
       State . . . . . . . . . . . .      --          1,049       1,049
                                       --------    --------    --------
                                       $  --         10,226      10,226
                                       ========    ========    ========

     Income tax expense attributable to income from continuing operations
differs from the amounts computed by applying the U.S. federal income tax
rate of 35 percent to pretax income from operations as a result of the
following:
                                         2005        2004        2003
                                       --------    --------    --------
Computed "expected" tax provision. .   $  8,442       3,723       7,255
Increase (reduction) in income
 taxes resulting from:
  Increase (reduction) in
    valuation allowance. . . . . . .     (4,893)      2,365       3,756
  Other, net . . . . . . . . . . . .       (472)       (337)       (785)
                                       --------    --------    --------
      Total. . . . . . . . . . . . .   $  3,077       5,751      10,226
                                       ========    ========    ========



<PAGE>


     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, 2005 and
2004 are as follows:
                                                     2005        2004
                                                   --------    --------
    Deferred tax assets:
      Post retirement benefits . . . . . . . . .   $ (1,059)     (1,274)
      Reserves related primarily to losses
        on divestitures. . . . . . . . . . . . .     (6,433)     (8,491)
      Loss carryforwards . . . . . . . . . . . .     (1,322)     (6,216)
      Tax credit carryforwards . . . . . . . . .     (4,081)     (4,081)
      Other, net . . . . . . . . . . . . . . . .     (1,048)     (1,772)
                                                   --------    --------
        Total deferred tax assets. . . . . . . .    (13,943)    (21,834)
        Less - valuation allowance . . . . . . .      5,403      10,297
                                                   --------    --------
        Net deferred tax assets. . . . . . . . .     (8,540)    (11,537)
                                                   --------    --------
    Deferred tax liabilities:
      Property, plant and equipment,
        principally due to purchase
        accounting adjustments,
        net of impairment charges. . . . . . . .     25,339      25,667
      Prepaid pension and core retirement
        award costs. . . . . . . . . . . . . . .     11,398      10,990
                                                   --------    --------
          Total deferred tax liabilities . . . .     36,737      36,657
                                                   --------    --------
          Net deferred tax liability . . . . . .   $ 28,197      25,120
                                                   ========    ========

     The Company at December 31, 2005 has net operating loss carryforwards
("NOLs") of $32,000 for state income tax purposes which can be used to
offset taxable income, if any, in future years.  Substantially all
remaining federal NOLs are expected to be utilized in 2005 and the state
NOLs began to expire in 2005.

     Federal tax return examinations have been completed for all years
through 2000.  Refunds aggregating approximately $4,700 are due for
previous payments of taxes and interest.  Such refunds and the reduction of
certain related contingencies reduced selling, general and administrative
in the consolidated statement of operations.  The statutes of limitations
with respect to the Company's tax return for 2001 and subsequent years
remain open.  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 could be liable could be material.


(7)  TRANSACTIONS WITH AFFILIATES

     An affiliated insurance agency, JMB Insurance Agency, Inc., earns
insurance brokerage commissions in connection with providing the placement
of insurance coverage for certain of the properties and operations of the
Company.  Such commissions are believed by management to be comparable to
those that would be paid to such affiliate insurance agency in similar
dealings with unaffiliated third parties.  The total of such commissions
for the years ended December 31, 2005, 2004 and 2003 was approximately $13,
$8 and $102, respectively, all of which was paid as of December 31, 2005.

     The Company pays a non-accountable reimbursement of $30 per month to
JMB Realty Corporation in respect of general overhead expense, all of which
was paid as of December 31, 2005.



<PAGE>


     The Company reimburses their affiliates 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 affiliate, Management Services,
LLC, during 2005.  The total costs for the years ended 2005, 2004 and 2003
were approximately $2,400, $1,800 and $1,800, respectively, of which
approximately $494 was unpaid as of December 31, 2005.


(8)  COMMITMENTS AND CONTINGENCIES

     As security for performance of certain development obligations, the
Company is contingently liable under two subdivision bonds for
approximately $23,300.

     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.  In proceedings filed prior to the Petition Date where a Debtor is
a defendant, such proceedings were stayed as against such Debtor by the
filing of the Reorganization Case.  Those proceedings could continue since
the Plan Effective Date had occurred so long as the plaintiffs therein
filed timely claims under the Plan.  However, any judgments rendered
therein were subject to the distribution provisions of the Plan, which
resulted in the entitlement of such claims to proceeds that were
substantially less than the face amount of such judgments.  Any claims that
were not filed on a timely basis under the Plan have been discharged by the
Bankruptcy Court and thus the underlying legal proceedings should not
result in any liability to the Debtors.  All other claims have been
satisfied.  Proceedings against subsidiaries or affiliates of Kaanapali
Land that are not Debtors were not stayed by the Plan and may proceed.
However, one such subsidiary, Oahu Sugar, filed a subsequent petition for
liquidation under Chapter 7 of the Bankruptcy Code in April 2005, as
described below.

     On June 3, 2003, the Trustees under the Will and of the Estate of
Bernice Paugahi Bishop, deceased, also known as Kamehameha Schools
("Trustees") filed a Complaint against Oahu MS and City Bank in Trustees
Under the Will and the Estate of Bernice Paugahi Bishop, deceased, also
known as Kamehameha Schools v. Amfac Property Development Corp., et al, in
the Circuit Court of the First Circuit, State of Hawaii, Civil No. 03-1-
1154-05, seeking, among other things, cancellation of certain leases with
APDC, collection of unpaid net rents on the leases, and appointment of a
receiver to collect future subrents under the subleases.  Concurrent
therewith, Trustees filed a motion for appointment of receiver.  Oahu MS
filed its answer on June 24, 2003.

     On October 22, 2004, the parties entered into a settlement agreement
to resolve the case and related issues.  Under the terms of the settlement,
and in consideration of among other things APDC's payment of $400 to Bishop
Estate, the parties have entered into mutual releases of pending claims
arising out of or in connection with the pending lawsuit, the leased
properties, and the receivership.  Pursuant to the terms of the settlement,
the above-mentioned sum was paid and the leases were cancelled effective
December 29, 2004.  The stipulation to dismiss the suit is expected to be
filed shortly.



<PAGE>


     On or about February 23, 2001 Kekaha Sugar Co., Ltd., a company that
was, prior to its dissolution, a subsidiary of Kaanapali Land, received a
letter from the Hawaii Department of Health ("HDOH") assigning the Kekaha
Sugar Co., Ltd. site a high priority status based on HDOH's review of
available environmental data.  In the letter, HDOH identified five major
areas of potential environmental concern including the former wood
treatment plant, the herbicide mixing plant, the seed dipping plant, the
settling pond, and the Kekaha Sugar Mill.  While setting forth specific
concerns, the HDOH reserved the right to designate still further areas of
potential concern which might require further investigation and possible
remediation.  HDOH further reserved the right to modify its prioritization
of the site should conditions warrant.  The assignment of the high priority
status will likely result in a high degree of oversight by the HDOH as the
issues raised are studied and addressed.  Kekaha Sugar Co., Ltd. has
responded to the letter.  The United States Environmental Protection Agency
has performed a visual inspection of the property and indicated there will
be some testing performed.  HDOH has performed some testing at the site and
results are pending.  Kekaha Sugar Co., Ltd. was substantially without
assets and was dissolved.  On or about February 23, 2001, the Lihue
Plantation Company, Limited, now known as LPC Corporation ("LPCo") received
a similar letter from the HDOH assigning the LPCo site a high priority
status based on HDOH's review of available environmental data.  In the
letter, HDOH identified four major areas of potential environmental concern
relative to LPCo's former operations including the herbicide mixing plant,
the seed dipping plant, the settling pond and the Lihue Sugar Mill.  While
setting forth specific concerns, the HDOH reserved the right to designate
still further areas of potential concern which might require further
investigation and possible remediation.  HDOH further reserved the right to
modify its prioritization of the site should conditions warrant.  As noted
above, the high priority assignment will likely result in a high degree of
oversight by the HDOH as the issues raised are studied and addressed.  LPCo
is substantially without assets and further pursuit of this matter by HDOH
could have a material adverse effect on the financial condition of LPCo.

      The purchaser of the Kehaha and Lihue Sugar Mill properties in
January 2005 assumed any obligations for environmental matters concerning
the property if purchased.  However, there can be no assurance that such
purchasers will have sufficient assets to satisfy a claim should any
substantial liabilities result.

     Pioneer Mill was engaged in a modest cleanup operation arising out of
the discovery of petroleum contamination found at the Pioneer Mill site.
The Pioneer Mill site was assigned a high priority by the HDOH and the HDOH
has shown an interest in the environmental conditions relating to or
arising out of the former operations of Pioneer Mill.  EPA has designated
HDOH as the oversight agency for Pioneer Mill.  Pioneer Mill received a
report on the results of environmental testing conducted on the site by the
United States Environmental Protection Agency and HDOH.  However, Pioneer
Mill's cleanup efforts to date have satisfied HDOH and Pioneer Mill
received a no further action letter during the fourth quarter of 2004.  It
is possible that further cleanup operations may become necessary in
connection with the ongoing demolition of the former sugar mill buildings
on the site.



<PAGE>


     As a result of an administrative order issued to Oahu Sugar by the
HDOH, Order No. CH 98-001, dated January 27, 1998, Oahu Sugar was engaged
in environmental site assessment of lands it leased from the U.S. Navy and
located on the Waipio Peninsula.  Oahu Sugar submitted a Remedial
Investigation Report to the HDOH.  The HDOH provided comments which
indicated that additional testing may be required.  Oahu Sugar responded to
these comments with additional information.  On January 9, 2004, EPA issued
a request to Oahu Sugar seeking information related to the actual or
threatened release of hazardous substances, pollutants and contaminants at
the Waipio Peninsula portion of the Pearl Harbor Naval Complex National
Priorities List Superfund Site.  The request sought, among other things,
information relating to the ability of Oahu Sugar to pay for or perform a
clean up of the land formerly occupied by Oahu Sugar.  Oahu Sugar was in
the process of responding to the information requests and had notified both
the Navy and the EPA that while it had some modest remaining cash that it
could contribute to further investigation and remediation efforts in
connection with an overall settlement of the outstanding claims, Oahu Sugar
was substantially without assets and would be unable to make a significant
contribution to such an effort.  While Oahu Sugar contested its liability
for such contamination and believed that it had meritorious defenses to any
claims, it did not have sufficient assets to justify litigation and
believed that attempting to cooperate and negotiate with the government was
its only opportunity to avoid bankruptcy.  Nevertheless, attempts at
negotiating such a settlement were fruitless and Oahu Sugar received an
order from EPA in March 2005 that would purport to require certain testing
and remediation of the site.  While the cost of compliance could not be
estimated, it was clear that the cost involved would have greatly exceeded
Oahu Sugar's remaining assets.  Oahu Sugar has no source of additional
capital and has substantial unpaid obligations to Kaanapali Land and other
affiliates.  Furthermore, as Oahu Sugar is substantially without assets,
the pursuit of any action, informational, enforcement, or otherwise, would
have had a material adverse effect on the financial condition of Oahu
Sugar.

     Therefore, as a result of the pursuit of further action by the HDOH
and EPA as described above and the immediate material adverse effect that
the actions had on the financial condition of Oahu Sugar, Oahu Sugar filed
with the United States Bankruptcy Court, Northern District of Illinois,
Eastern Division its voluntary petition for liquidation under Chapter 7 of
Title 11, United States Bankruptcy Code, 11 U.S.C. Subsection 101-1330 on
April 19, 2005, Case No. 05-15100.  Such filing is not expected to have a
material adverse effect on the Company as Oahu Sugar was substantially
without assets at the time of the filing and it is not believed that any
other affiliates have any responsibility for the debts of Oahu Sugar.

     EPA sent two requests for information to Kaanapali Land regarding
Kaanapali Land's organization and relationship, if any, to entities that
may have, historically, operated on the site.  Kaanapali Land responded to
the requests for information.  It is not clear what EPA proposes to do with
the information that has been provided.  EPA has not designated Kaanapali
Land as a potentially responsible party.

     Federal tax return examinations have been completed for all years
through 2000.  Refunds aggregating approximately $4,700 are due for
previous payments of taxes and interest.  The statutes of limitations with
respect to the Company's tax return for 2001 and subsequent years remain
open.  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 could be liable could be material.



<PAGE>


     On February 15, 2005, D/C Distribution Corporation ("D/C"), a
subsidiary of Kaanapali Land, was served with a lawsuit entitled American &
Foreign Insurance Company v. D/C Distribution and Amfac Corporation, Case
No. 04433669 filed in the Superior Court of the State of California for the
County of San Francisco, Central Justice Center.  In the eight-count
complaint for declaratory relief, reimbursement and recoupment of
unspecified amounts, costs and for such other relief as the court might
grant, plaintiff alleges that it is an insurance company to whom D/C has
tendered for defense and indemnity various personal injury lawsuits
allegedly based on exposure to asbestos containing products.  Plaintiff
alleges that because none of the parties have been able to produce a copy
of the policy or policies in question a judicial determination of the
material terms of the missing policy or policies is needed.  Plaintiff
seeks, among other things, a declaration:  of the material terms, rights,
and obligations of the parties under the terms of the policy or policies;
that the policies have been exhausted; that plaintiff is not obligated to
reimburse D/C for its attorneys' fees in that the amounts of attorneys'
fees incurred by D/C have been incurred, unreasonably; that plaintiff is
entitled to recoupment and reimbursement of some or all of the amounts it
has paid for defense and/or indemnity; and that D/C has breached its
obligation of cooperation with plaintiff.  D/C has filed an answer and
cross-claim.  The litigation is in its early stages and D/C believes that
it has meritorious defenses and positions, and intends to vigorously
defend.  In February 2006, in order to simplify its administration and
facilitate an additional capital contribution by Kaanapali Land, D/C merged
into a newly-formed Illinois limited liability company named D/C
Distribution, LLC.

     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.  There are approximately 77 cases against such
subsidiary that are pending on the mainland and are alleged based on such
subsidiary's prior business operations.  Each company believes that it has
meritorious defenses against these actions, but can give no assurances as
to the ultimate outcome of these cases.  In the case of D/C, there can be
no certainty that it will be able to satisfy its liabilities for these
cases or future judgments, if any.  There can be no assurances that these
cases (or any of them), if adjudicated in a manner adverse to the
subsidiary, will not have a material adverse effect on the financial
condition of such subsidiary.  Kaanapali Land does not believe that it has
liability, directly or indirectly, for such subsidiary's obligations.

     Northbrook Corporation ("Northbrook"), a predecessor by merger to
Kaanapali Land was named in a lawsuit filed in August 2003 in the Circuit
Court of Cook County, Chicago, Illinois, styled Silverado Golf & Country
Club, Inc. v. JMB Realty Corporation and Northbrook Corporation.  The
lawsuit sought unspecified damages and alleged that the defendants engaged
in fraudulent conduct in connection with the administration and termination
of a defined benefit pension plan that had been sponsored by Northbrook
Corporation and certain affiliates and predecessors.  In the eight count
amended complaint, the plaintiff sought unspecified general damages, the
imposition of a constructive trust, an accounting, attorneys' fees and
costs, interest, punitive damages and such other further relief as deemed
appropriate by the court under the circumstances.  The amended complaint
was dismissed with prejudice on March 4, 2005, pursuant to a settlement and
without any payment of money by defendants.

     Other than as described above and the Reorganization Case 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.




<PAGE>


(9) BUSINESS SEGMENT INFORMATION

     As described in Note 1, the Company operates in three business
segments.  Total revenues, operating profit, identifiable assets, capital
expenditures, and depreciation and amortization by business segment are
presented in the tables below.

     Total revenues by business segment includes primarily (i) sales, all
of which are from unaffiliated customers and (ii) interest income that is
earned from outside sources on assets which are included in the individual
industry segment's identifiable assets.

     Operating profit is comprised of total revenue less operating
expenses.  In computing operating profit, none of the following items have
been added or deducted:  general corporate revenues and expenses, interest
expense, income taxes, and equity in income (loss) from unconsolidated
investments.

     Identifiable assets by business segment are those assets that are used
in the Company's operations in each industry. Corporate assets consist
principally of cash and cash equivalents, prepaid pension costs and
receivables related to previously divested businesses. Investments in net
assets of unconsolidated investments are related to ownership interests
held by the Company primarily in various real estate related entities.

                                         2005        2004        2003
                                       --------    --------    --------
Revenues:
  Property . . . . . . . . . . . . .   $ 31,180       8,139      56,184
  Agriculture  . . . . . . . . . . .      1,515       1,354       1,241
  Golf . . . . . . . . . . . . . . .      3,719       3,843       4,141
  Corporate. . . . . . . . . . . . .        837         580       2,217
                                       --------    --------    --------
                                       $ 37,251      13,916      63,783
                                       ========    ========    ========

Operating income (loss):
  Property . . . . . . . . . . . . .   $ 15,078       4,981      21,234
  Agriculture  . . . . . . . . . . .      1,192         973        (912)
  Golf . . . . . . . . . . . . . . .        334         381         580
                                       --------    --------    --------

Operating income (loss). . . . . . .     16,604       6,335      20,902

Corporate. . . . . . . . . . . . . .      7,683       5,046       1,357
Interest expense . . . . . . . . . .       (168)       (743)     (1,129)
Equity in income (loss) from
  unconsolidated investments . . . .      --          --           (402)
                                       --------    --------    --------
Income (loss) from continuing
  operations before income taxes
  and gain on disposition of
  unconsolidated investment. . . . .   $ 24,119      10,638      20,728
                                       ========    ========    ========

Identifiable Assets:
  Property . . . . . . . . . . . . .   $ 60,155      62,009      65,919
  Agriculture. . . . . . . . . . . .     51,633      51,137      48,091
  Golf . . . . . . . . . . . . . . .     27,147      27,362      29,084
                                       --------    --------    --------

                                        138,935     140,508     143,094

Corporate. . . . . . . . . . . . . .     48,940      38,893      46,379
                                       --------    --------    --------
                                       $187,875     179,401     189,473
                                       ========    ========    ========


<PAGE>


     Agricultural identified assets include land classified as agricultural
or conservation for State and County purposes.

                                         2005        2004        2003
                                       --------    --------    --------
Capital Expenditures:
  Property . . . . . . . . . . . . .   $  2,538       1,737         861
  Agriculture. . . . . . . . . . . .        224           2         197
  Golf . . . . . . . . . . . . . . .        389         314         132
  Corporate. . . . . . . . . . . . .      --          --          --
                                       --------    --------    --------
                                       $  3,151       2,053       1,190
                                       ========    ========    ========

Depreciation and Amortization:
  Property . . . . . . . . . . . . .   $     70          92          87
  Agriculture. . . . . . . . . . . .         75          91          60
  Golf . . . . . . . . . . . . . . .        515         535         609
  Corporate. . . . . . . . . . . . .        380         418         408
                                       --------    --------    --------
Total. . . . . . . . . . . . . . . .   $  1,040       1,136       1,164
                                       ========    ========    ========

(10) CALCULATION OF NET INCOME PER SHARE

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

                                 Year Ended    Year Ended    Year Ended
                                 December 31,  December 31,  December 31,
                                    2005          2004          2003
                                 ------------  ------------  ------------
                                          (Amounts in thousands
                                        except per share amounts)
NUMERATOR:
Operating income (loss). . . .    $   24,119        10,638        21,130
                                  ==========    ==========    ==========
Equity in income (loss) from
  unconsolidated investments .    $    --            --             (402)
                                  ==========    ==========    ==========
Income (loss) from continuing
  operations . . . . . . . . .    $   21,042         4,887        10,502

Gain on disposition of
  unconsolidated investment. .         --            --           60,134
                                  ----------    ----------    ----------
Net income (loss). . . . . . .    $   21,042         4,887        70,636
                                  ==========    ==========    ==========
DENOMINATOR:
Denominator for net income
  (loss) per share -
  basic and diluted. . . . . .    $    1,793         1,793         1,791
                                  ==========    ==========    ==========
Net income (loss) per
  share - basic and diluted. .    $    11.74          2.73         39.44
                                  ==========    ==========    ==========
Net income per share -
  basic and diluted:
Income (loss) from
  continuing operations. . . .    $    11.74          2.73          5.86
Gain on disposition of
  unconsolidated investment. .         --            --            33.58
                                  ----------    ----------    ----------
Net income per share basic
  and diluted. . . . . . . . .    $    11.74          2.73         39.44
                                  ==========    ==========    ==========


<PAGE>


     Pursuant to the Plan, a maximum of 1,863,000 shares of the Company
were issuable.  As of December 31, 2005, the Company had issued and
outstanding 1,631,513 Class B shares, non par value, and approximately
161,100 Class A shares, non par value stock.  The Company does not expect
to issue any additional shares under the Plan.  The LLC Agreement provides
for two classes of membership interests, Class A Shares and Class B Shares,
which have substantially identical rights and economic value under the LLC
Agreement; except that holders of Class A Shares are represented by a
"Class A Representative" who must approve certain transactions proposed by
Kaanapali Land  before they can be undertaken.  Class B Shares are held by
Pacific Trail and various entities and individuals that are affiliated with
Pacific Trail.  Class A Shares were issued under the Plan to claimants who
had no such affiliation.



ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
         AND FINANCIAL DISCLOSURE

     There were no changes in or disagreements with the accountants during
the fiscal years 2005, 2004 and 2003.



ITEM 9A. 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 Securities and Exchange Commission.


<PAGE>


                                 PART III


ITEM 10.  MANAGERS AND EXECUTIVE OFFICERS OF THE REGISTRANT

    The sole manager 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 LLC Agreement.  Although the
executive officers of Kaanapali Land are empowered to manage its day-to-day
business affairs, under the 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 not be removed as
manager except in those circumstances described in Item 11 below.  As of
March 15, 2006, the executive officers and certain other officers of the
Company were as follows:

                                          Position
                                          Held with
         Name                             the Company
      ----------                          ------------

      Gary Nickele                        President and
                                            Chief Executive Officer
      Stephen A. Lovelette                Executive Vice President
      Gailen J. Hull                      Senior Vice President and
                                          Chief Financial 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.

     There is no family relationship among any of the foregoing officers.

     The LLC Agreement also provides for the appointment of a "Class A
Representative" to monitor the activities of Kaanapali Land on behalf of
its Class A Shareholders.  The Class A Representative who must be
independent is entitled to receive certain information from Kaanapali Land
and must approve certain actions that Kaanapali Land may take outside the
course of business primarily related to debt that might be obtained from
affiliated parties.  The current Class A Representative is RSM McGladry,
Inc.  Reference is also made to Item 11 for more information.

     There are no arrangements or understandings between or among any of
said officers and any other person pursuant to which any officer was
selected as such.



<PAGE>


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

     Gary Nickele (age 53) has been Manager of KLC Land since August, 2000
and President of KLC Land and certain of its subsidiaries since February
2001.  He has been the President of Kaanapali Land since May 2002.  Mr.
Nickele is also the President and Director of Arvida Company, the
administrator of ALP Liquidating Trust, which exists to manage the
liquidation of the former business of Arvida/JMB Partners, L.P. ("Arvida
Partners").  From October 1987 until September 2005, Arvida Partners
conducted land development activities primarily in Florida.  Mr. Nickele
has been associated with JMB and Arvida Partners since February, 1984 and
September, 1987, respectively.  He holds a J.D. degree from the University
of Michigan Law School and is a member of the Bar of the State of Illinois.

Mr. Nickele's experience relative to JMB, the Company and Arvida Partners
during the past five years has included overall responsibility for all
legal matters, oversight of the relationship of Arvida Partners and its
affiliates, including matters relating to property development and sales
and general personnel and administrative functions. During the past five
years, Mr. Nickele has also been an Executive Vice President of JMB.

     Stephen Lovelette (age 49) has been an Executive Vice President of KLC
Land since 2000 and Kaanapali Land since May 2002.  Mr. Lovelette is in
charge of implementing the Kaanapali 2020 development plan.  Mr. Lovelette
has been associated with JMB and its affiliates for over 15 years.  Prior
to joining an affiliate of JMB, Mr. Lovelette worked for Arvida
Corporation, the predecessor to Arvida Partners, under its previous
ownership.  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 Arvida Partners.
During the past five years, Mr. Lovelette has also been a Managing Director
of JMB.

     Gailen J. Hull (age 56) is Senior Vice President and, since August
2002, Chief Financial Officer of Kaanapali Land.  Mr. Hull has been
associated with JMB since March, 1982.  He holds a Masters degree in
Business Administration from Northern Illinois University and is a
Certified Public Accountant.  Mr. Hull has substantial experience in the
management of the accounting and financial reporting functions of both
public and private entities, primarily including those of JMB, Arvida
Partners, the Company and their respective affiliates. During the past five
years, Mr. Hull has also been a Senior Vice President of JMB.

     It is currently anticipated that Gary Nickele will devote 25 to 50
percent of his time to the operations of the Company.  The percentage is
largely dependant 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).

     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 limited liability company agreement, the
Company has determined that it is not necessary to have either an audit
committee financial expert or a code of ethics as those terms are defined
in the rules and regulations of the SEC.




<PAGE>


ITEM 11.  EXECUTIVE COMPENSATION

   Certain of the officers of the Company listed in Item 5 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

                        Annual Compensation (1)(3)
                        ---------------------------
                                                               Other
                                                              Annual
                                                             Compensa-
                   Principal               Salary     Bonus    tion
Name (2)           Position (4)     Year     ($)       ($)      ($)
---------------    ------------    -----   -------   ------  ---------

Gary Nickele       President        2005   180,000  100,000     N/A
                   and Chief        2004   180,000  100,000     N/A
                   Executive        2003   180,000  100,000     N/A
                   Officer

Stephen A.
  Lovelette        Executive        2005   215,000  100,000     N/A
                   Vice President   2004   195,000  100,000     N/A
                                    2003   175,000   50,000     N/A

Gailen J. Hull     Senior Vice      2005   175,000   50,000     N/A
                   President and    2004   175,000   50,000     N/A
                   Chief Financial  2003   175,000   50,000     N/A
                   Officer
----------

      (1)   The Company does not have a compensation committee.  Executive
officer compensation was determined through deliberations with Pacific
Trail representatives.

      (2)   Includes CEO and all other executive officers.

      (3)   Salary and bonus amounts for Messrs. Nickele, Lovelette and
Hull represent the portion of total compensation allocated and charged to
the Company.

      (4)   Positions listed are those for Kaanapali Land, and prior to its
formation, with KLC Land.



<PAGE>


ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Security ownership of certain beneficial owners.

                     NAME AND ADDRESS                 AMOUNT AND NATURE
                     OF BENEFICIAL                    OF BENEFICIAL
TITLE OF CLASS       OWNER                            OWNERSHIP
--------------       ---------------------------      --------------------

Class B Shares       Pacific Trail Holdings, LLC      1,466,573 Shares
                     900 North Michigan Avenue        owned directly
                     Chicago, Illinois 60611          (89.9% of the
                                                      Class B Shares)
                                                      (1) (2)

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

(2)   As of March 15, 2006, there were 1,631,513 Class B 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 Class A or Class B
shares issued, outstanding and distributed.  No officers of the Company own
any Class A Shares.




<PAGE>


ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     An affiliated insurance agency, JMB Insurance Agency, Inc., earns
insurance brokerage commissions in connection with providing the placement
of insurance coverage for certain of the properties and operations of the
Company.  Such commissions are comparable to those that would be paid to
such affiliate insurance agency in similar dealings with unaffiliated third
parties, and are generally paid by the insurance carriers that the agency
represents out of the premiums paid by the Company for such coverage.  The
total of such commissions for the years ended December 31, 2005, 2004 and
2003 was approximately $13 thousand, $8 thousand and $102 thousand,
respectively, all of which was paid as of December 31, 2005.

     The Company pays a non-accountable reimbursement of approximately $30
thousand per month to JMB Realty Corporation in respect of general overhead
expense, all of which was paid as of December 31, 2005.

     The Company reimburses their affiliates 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 affiliate, Management Services,
LLC, during 2005.  The total costs for the years ended December 31, 2005,
2004 and 2003 was approximately $2.4 million, $1.8 million and $1.8
million, respectively, of which approximately $494 thousand was unpaid as
of December 31, 2005.


ITEM 14.  PRINCIPAL ACCOUNTANT FEES AND SERVICES

     The aggregate audit fees incurred for professional services by Ernst
and Young LLP ("E&Y") in 2005, 2004 and 2003 were $167,600, $157,000 and
$154,300, respectively.  In accordance with the SEC's definitions and
rules, "audit fees" are fees the Company paid E&Y for professional services
for the audit of the Company's consolidated financial statements included
in Form 10-K and review of financial statements included in Form 10-Qs, and
for services that are normally provided by the accountant in connection
with statutory and regulatory filings or engagements.  There were no non-
audit related, tax or other services provided by E&Y.

     The Company has not adopted any pre-approval policies and procedures.
All audit and permitted non-audit services are approved by the managing
member of the Company before the service is undertaken.



<PAGE>


                                  PART IV

ITEM 15.  EXHIBITS AND REPORTS ON FORM 8-K

  (a) Exhibits.

       2.1  Order Confirming Second Amendment Joint Plan of Reorganization
            Dated June 11, 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.

      10.1  Honokohau Water License, dated December 22, 1980,
            between Maui Pineapple Company Ltd. and Pioneer Mill
            Company, Limited. (1)

      10.2  Water Licensing Agreement, dated September 22, 1980, by
            and between Maui Land & Pineapple Company, Inc. and
            Amfac, Inc. (1)

      10.3  Funding Agreement dated October 29, 2002 between
            Kaanapali Land and certain affiliates filed as an exhibit to
            the Company's Form 10 filed May 1, 2003 and hereby incorporated
            by reference.

      10.4  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.

      10.5  Property Purchase and Option Agreement by and between NB
            Lot 4, LLC, Maui Beach Resort Limited Partnership, and NB
            Lot 3, LLC dated August 4, 2003 filed as an exhibit to the
            Company's report on Form 8-K (File No. 0-50273) filed on
            August 22, 2003 is hereby incorporated by reference.

      10.6  Lot 3 Option Agreement by and between NB Lot 3, LLC and
            Maui Beach Resort Limited Partnership dated August 5, 2003
            filed as an exhibit to the Company's report on Form 8-K
            (File No. 0-50273) filed on June 21, 2005 is hereby
            incorporated by reference.



<PAGE>


      21.   List of Subsidiaries

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

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

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

      99.1  Settlement Agreement dated March 14, 2003 between Amfac
            Property Investment Corp., Amfac Hawaii, LLC, Pioneer
            Mill Company, Limited, and Employees' Retirement System
            of the State of Hawaii filed as an exhibit to the Company's
            report on Form 8-K (File No. 0-50273) filed on September 26,
            2003 is hereby incorporated by reference.

     (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.

      (b)   No reports on Form 8-K were filed since the beginning of the
            last quarter of the period covered by the report.




<PAGE>


                                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.


                              KAANAPALI LAND, LLC

                              BY:   Pacific Trail Holdings, LLC
                                    (Sole Member)


                                    /s/ Gailen J. Hull
                                    ---------------------
                              By:   Gailen J. Hull
                                    Senior Vice President
                              Date: March 27, 2006



     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/ Gailen J. Hull
                                    ---------------------
                              By:   Gailen J. Hull,
                                    Senior Vice President
                                    Chief Accounting Officer
                                    and Chief Financial Officer
                              Date: March 27, 2006



                                    /s/ Gary Nickele
                                    ---------------------
                              By:   Gary Nickele,
                                    President and
                                    Chief Executive Officer
                              Date: March 27, 2006