Woodbridge Liquidation Trust - Annual Report: 2023 (Form 10-K)

Statements Regarding Forward-Looking Statements. This Annual Report, and other filings by the Trust with the U.S. Securities and Exchange Commission (“SEC”), or written statements made by the Trust in press releases or in other communications, oral or written, may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, as codified in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act” and, together with the Securities Act, the “Acts”). Such statements include, without limitation, statements (other than historical facts) that address future plans, goals, expectations, activities, events or developments. The Trust has tried, where possible, to use words such as “anticipates”, “if”, “believes,” “estimates,” “plans,” “expects,” “intends,” “forecasts”, “initiative, “objective”, “goal, “projects”, “outlook”, “priorities”, “target”, “evaluate”, “pursue”, “seek”, “potential”, “continue”, “designed”, “impact”, “may”, “could”, “would”, “should”, “will” and similar expressions to identify forward-looking statements. Forward-looking statements are based on current expectations and are subject to substantial risks, uncertainties and other factors, many of which are beyond our control and not of all of which can be predicted by the Trust. Such risks and uncertainties include the amount of funds needed for construction defect and other claims, the amount of general and administrative costs, the number and amount of successful litigations and/or settlements and the ability to recover thereon, the amount of funding required to continue litigations, changes in tax and other governmental rules and regulations applicable to the Trust and its subsidiaries, and other risks identified and described in “Item 1A. Risk Factors” of this Annual Report. Accordingly, the Trust cannot guarantee that any forward-looking statements will be realized, as actual results may differ materially from those identified or implied in any forward-looking statement. These risks and uncertainties are beyond the ability of the Trust to control, and in many cases, the Trust cannot predict the risks and uncertainties that could cause its actual results to differ materially from those indicated by the forward-looking statements.

The purpose of the Wind-Down Entity is, through its subsidiaries (the “Wind-Down Subsidiaries” and, with the Wind-Down Entity, the “Wind-Down Group”), to develop (as applicable), market, and sell the real estate assets owned by the Wind-Down Subsidiaries to generate cash to be remitted to the Trust after the payment of Wind-Down Group expenses and subject to the retention of various reserves. The Trust, the Remaining Debtors (as defined in Section B of this Item 1) and the Wind-Down Group are collectively referred to in this Annual Report as the “Company.”

During the year ended June 30, 2023, the Company concluded that its liquidation activities would not be completed by February 15, 2024, the current outside termination date of the Trust, for a number of reasons. First, there have been significant delays in certain legal proceedings where the Company is the plaintiff as more fully described in "Item 3. Legal Proceedings". Second, a construction defect claim has been asserted against one of the Wind-Down Subsidiaries by the buyer of one of the subsidiary’s single-family homes. The subsidiary has tendered the claim to its insurance carrier. At this time, the amount of the liability exposure, if any, has not been determined and it is not known if the subsidiary has any exposure in excess of its insurance coverage. The subsidiary is investigating the claim, including the extent and causes of the alleged damage and the identification of other potentially responsible persons. Based on the foregoing, the Company currently projects a revised estimated completion date for the Company’s operations of approximately March 31, 2026.

Pursuant to the Plan and the Liquidation Trust Agreement of the Trust (as amended, the “Trust Agreement”), a copy of which is referenced as Exhibits 3.2, 3.3 and 3.4 to this Annual Report, distributions to Interestholders are net of any costs and expenses incurred by the Trust, including in connection with administering the Trust and litigating or otherwise resolving the various Causes of Action and disputed claims. Amounts withheld from distribution may include cost of collecting, administering, distributing, and liquidating the Trust assets such as fees and expenses of the Liquidation Trustee, premiums for directors’ and officers’ insurance, and fees and expenses of attorneys and consultants. Furthermore, cash received from the Wind-Down Group is net of the payment of Wind-Down Group expenses and the retention of reserves by the Wind-Down Group for contingent liabilities, including potential construction defect claims.

Reflective of the progress toward the completion of its liquidation activities, the following two tables show the Wind-Down Group’s decreasing number of real estate assets and amount of net carrying values of the real estate assets since the Plan Effective Date and through June 30, 2023:

The Trust’s distributed cash through June 30, 2023, together with its distributions payable as of June 30, 2023, totaled approximately $426.55 million.  The Trust’s consolidated net assets in liquidation as of June 30, 2023 were approximately $6.77 million.

On the Plan Effective Date and by operation of the Plan, the Wind-Down Entity became a wholly-owned subsidiary of the Trust. The Wind-Down Entity was organized for the purpose of accepting, holding, and administering the Debtors’ real estate assets and distributing the net proceeds of liquidating such real estate assets to the Trust in accordance with the Plan and the Limited Liability Company Agreement of the Wind-Down Entity (as amended, the “Wind-Down Entity LLC Agreement”), consistent with the purposes of the Trust. As of the Plan Effective Date, the Wind-Down Group received, in the aggregate, assets consisting of approximately $31.34 million in cash and approximately $585.01 million of real estate and other assets.

On December 24, 2019, the Trust’s Registration Statement on Form 10 became effective under the Exchange Act. The trading symbol for the Trust’s Class A Interests is WBQNL. Bid and ask prices for the Trust’s Class A Interests are quoted on the OTC Link^® ATS, the SEC-registered alternative trading system. The Class A Interests are eligible for the Depository Trust Company’s Direct Registration (DRS) services. The Class B Interests are not registered with the SEC.

Under the Plan and the Wind-Down Entity LLC Agreement, the Trust is required at all times to be the sole and exclusive owner of all membership interests of the Wind-Down Entity. The Trust is prohibited from selling, transferring, or otherwise disposing of its membership interests in the Wind-Down Entity without approval of the Bankruptcy Court, and the Wind-Down Entity is prohibited from issuing any equity interest to any other person.

Formerly under the Plan and the Wind-Down Entity LLC Agreement, the Wind-Down Entity was required to be managed by a three-member Board of Managers, one of whom was required to be the Chief Executive Officer. Accordingly, the Board of Managers initially consisted of Richard Nevins, M. Freddie Reiss, and Frederick Chin, with Mr. Chin as the Chief Executive Officer of the Wind-Down Entity.  On November 30, 2022, the Wind-Down Entity LLC Agreement was amended to reduce the Wind-Down Entities’ Board of Managers to two members and to eliminate the requirement that the Chief Executive Officer serve as a member of the Board of Managers, effective upon Mr. Chin’s resignation on December 31, 2022. Marion W. Fong was appointed to serve as Chief Executive Officer of the Wind-Down Entity effective as of January 1, 2023. Ms. Fong is not a member of the Board of Managers. On March 27, 2023, the Wind-Down Entity LLC Agreement was further amended and the Board of Managers was reduced to one person, M. Freddie Reiss, following the sale of the last single-family home and the resignation of Richard Nevins on April 29, 2023.

The Wind-Down Entity is required to advise the Trust regarding its affairs on at least a monthly basis, reasonably make available such information as is necessary for any reporting by the Trust and advise the Trust of material actions. Excess cash of the Wind-Down Entity (cash that is in excess of budgeted reserve for ongoing operations and other anticipated obligations including potential construction defect claims and expenses as determined by the Board of Managers) is required to be remitted to the Trust on a quarterly basis, and the Wind-Down Entity is restricted in its ability to invest or gift any of its assets or make asset acquisitions.

The Plan identified 12 types of Claims against and equity interests in the Debtors, eight of which were “classified” (i.e., placed into formalized classes under the Plan) and four of which are not. Claims required to be paid in full under the Plan are referred to as “Unimpaired Claims.” Four types of claims are not classified—(i) claims arising under Bankruptcy Code sections 503(b), 507(a)(2), 507(b), or 1114(e)(2) (“Administrative Claims”), (ii) claims by professionals employed in the Bankruptcy Cases pursuant to Bankruptcy Code sections 327, 328, 1103, or 1104 for compensation or reimbursement of costs and expenses relating to services provided during the period from the Petition Date through and including the Plan Effective Date (“Professional Fee Claims”), (iii) tax claims entitled to priority under Bankruptcy Code section 507(a)(8) (“Priority Tax Claims”), and (iv) debtor-in-possession financing claims (“DIP Claims”). The foregoing claims are all Unimpaired Claims and have been or will be paid in full. Although the amounts may be subject to negotiation based on the Debtors’ and creditors’ records, and to ultimate determination, if necessary, in the Bankruptcy Court, liabilities resulting from any such Administrative Claims, Professional Fee Claims, Priority Tax Claims, and DIP Claims that are allowed are analogous, in substance, to accounts payable. As of September 27, 2023, there were no allowed and unpaid DIP Claims. As of September 27, 2023, there were no unpaid Administrative Claims, approximately $.18 million of unpaid Priority Tax Claims and no remaining unpaid Professional Fee Claims.

Pursuant to the Plan and the Trust Agreement, distributions to Interestholders are net of any costs and expenses incurred by the Trust, including in connection with administering the Trust and litigating or otherwise resolving the various Causes of Action and disputed claims. Amounts withheld from distribution may include cost of collecting, administering, distributing, and liquidating the Trust assets such as fees and expenses of the Liquidation Trustee, reserves for contingent liabilities, including potential construction defect claims of the Wind-Down Entity and/or its subsidiaries, premiums for directors’ and officers’ insurance, and fees and expenses of attorneys and consultants. Distributions will be made only from assets of the Trust and only to the extent that the Trust has sufficient assets (in excess of amounts retained for contingent liabilities, including potential construction defect claims and future costs and expenses, among other things) to make such payments in accordance with the Plan and the Trust Agreement. No distribution is required to be made to any Interestholder unless such Interestholder is to receive in such distribution at least $10.00.

Formerly under the Plan and the Wind-Down Entity LLC Agreement, the Wind-Down Entity was required to be managed by a three-member Board of Managers, one of whom was required to be the Chief Executive Officer. Accordingly, the Board of Managers initially consisted of Frederick Chin (then the Chief Executive Officer of the Wind-Down Entity), Richard Nevins and M. Freddie Reiss (the latter two being former members of the Debtors’ New Board).  On November 30, 2022, the Wind-Down Entity LLC Agreement was amended to reduce the Wind-Down Entities’ Board of Managers to two members and to eliminate the requirement that the Chief Executive Officer serve as a member of the Board of Managers, effective upon Mr. Chin’s resignation on December 31, 2022, and Marion W. Fong was appointed to serve as Chief Executive Officer of the Wind-Down Entity effective as of January 1, 2023. Ms. Fong is not a member of the Board of Managers. On March 27, 2023, the Wind-Down Entity LLC Agreement was further amended and the Board of Managers was reduced to one person, M. Freddie Reiss, following the sale of the last single-family home and the resignation of Richard Nevins on April 29, 2023.

During the remainder of the fiscal year ending June 30, 2024, the Trust plans to continue to engage in the resolution of claims filed against the Debtors, the evaluation and prosecution of the Unresolved Causes of Action, the disposition of Forfeited Assets, and the payment of Priority Tax Claims against the Debtors. Subject to the receipt of remittances from the Wind-Down Entity, the payment of Trust expenses, Priority Tax Claims and the retention of various reserves, the Trust may also make distributions of cash to Interestholders in accordance with the Plan. However, during the fiscal year ended June 30, 2023, a construction defect claim was asserted against one of the Wind-Down Susidiaries by the buyer of one of the subsidiary’s single-family homes. The subsidiary has tendered the claim to its insurance carrier. At this time, the amount of the liability exposure, if any, has not been determined and it is not known whether the subsidiary has any exposure in excess of its insurance coverage. The subsidiary is investigating the claim, including the extent and causes of the alleged damage and the identification of other potentially responsible persons. On August 3, 2023, at the recommendation of the Liquidation Trustee, the Trust suspended the making of additional Trust distributions pending the results of the investigation of the claim.

During the remainder of the fiscal year ending June 30, 2024, the Wind-Down Group will continue to manage the liquidation of the remaining assets, including completing  the pending sale of its one parcel of real property, managing the performing secured loan through its December 15, 2024 maturity date, processing remaining bond and property tax refunds, coordinating all necessary work for the release of an escrow holdback and other activities as needed.  In addition, the Wind-Down Group will continue to work to satisfy construction defect claims (where such activities are considered necessary or appropriate).  The Wind-Down Group expects to fund its capital requirement for its operating costs primarily with cash and cash equivalents on hand.

Future distributions by the Trust will primarily depend on the successful outcome of the Unresolved Causes of Action.  The Company has disposed of substantially all of its real estate assets and does not expect to receive additional Fair Funds. The source of funds for future distributions by the Trust will depend primarily on its successful prosecution of the Unresolved Causes of Action.

Delays in the prosecution of the Unresolved Causes of Action, and the need to investigate and resolve a construction defect claim, are expected to extend the Company’s anticipated liquidation period. Appeals and other events that affect the duration of litigation have generated delays in the timing of net recoveries from the Trust’s prosecution of its Unresolved Causes of Action and completion of the Company’s liquidation. Additionally, a construction defect claim has been asserted against a subsidiary of the Trust by the buyer of one of the subsidiary’s single-family homes, and the Company’s investigation of the claim, including the extent and causes of the alleged damage and the identification of other potentially responsible persons, will require additional time. Accordingly, during the year ended June 30, 2023 the Company concluded that its liquidation activities would not be completed by February 15, 2024, the current outside termination date of the Trust. The Company currently projects a revised estimated completion date for the Company’s operations of approximately March 31, 2026. The Company is required to file a motion with the Bankruptcy Court to extend the termination date of the Trust beyond February 15, 2024. The motion is required to be filed within six months before February 15, 2024. The Company expects that the motion will be filed as required and that the Bankruptcy Court will grant the motion as the extension is needed to pursue additional Trust actions that are expected to yield additional proceeds to the Trust and to address the construction defect claim. Further delays in the Trust’s litigation, the receipt of any additional construction defect claims, or other events and factors may require the Company to seek further extensions of the term of the Trust.  Extensions of the Trust’s anticipated liquidation period will increase the overall operating and administrative costs of the Company and reduce the amounts available for distribution in respect of the Liquidation Trust Interests.

Limited information regarding developments in the Trust’s prosecution of the Unresolved Causes of Action and potential outcomes will be available; therefore, it may be difficult for Interestholders to assess the amount of recovery. The Trust is required to file current and periodic reports with the SEC, as required under the Exchange Act. The SEC reports include certain information regarding pending Unresolved Causes of Action. However, the Trust’s ability to disclose details of the Unresolved Causes of Action is limited by the inherent nature and rules of judicial proceedings, including, among other things, proceedings and filings that are sealed by a court, matters involving attorney-client and work product privilege and proceedings that are conducted on a confidential basis by agreement of the parties, such as settlement negotiations. To the extent that information regarding the Unresolved Causes of Action cannot be provided, it will be difficult for investors in the Liquidation Trust Interests to make any meaningful determination of the potential outcome or value of the Unresolved Causes of Action.

The Trust has a limited purpose. The Trust cannot conduct any trade or business for profit. The Trust was formed pursuant to a chapter 11 bankruptcy plan. The Trust’s purpose is to prosecute Causes of Action, to litigate and resolve claims filed against the Debtors, to pay Allowed Administrative Claims and Priority Claims against the Debtors (including professional fees), to receive cash from certain sources and, in accordance with the Plan, to make distributions of cash to Interestholders subject to the retention of various reserves, including those related to potential construction defect claims and after the payment of Trust expenses and Allowed Administrative Claims and Priority  Claims.

Being a public company is expensive and administratively burdensome. The Trust is subject to the periodic reporting requirements of the Exchange Act. The Trust’s status as a reporting company under the Exchange Act causes the Trust to incur additional legal, accounting, financial reporting and other expenses.

None.

As of September 27, 2023, the Company’s real estate consists of one performing loan secured by a property located in the state of Ohio and one property located in the state of Hawaii.  A transaction for the sale of the property located in Hawaii is currently pending.

Item 3.

Legal Proceedings

The case was designated as a complex matter on December 18, 2019 and was assigned to the Honorable Amy Hogue. The following are updates since the initial filing:

•	On September 11, 2020, the Trust reached a settlement with Finn Dixon & Herling LLP and Reed Balmer that resolved all litigation between them.

Wind-Down Group litigation. The Wind-Down Group owned a portfolio of real estate assets, which included secured loans and other properties.  As part of its recovery efforts, the Wind-Down Group, through its subsidiaries, is involved in ordinary routine litigation incidental to such assets.  Among other litigation, certain Woodbridge entities (including the Trust, the Wind-Down Entity, and WB 8607 Honoapiilani, LLC) filed an action against Certain Underwriters at Lloyd’s of London in Los Angeles Superior Court, alleging that the defendant insurer breached its obligations under an insurance policy purchased to protect a property owned by WB 8607 Honoapiilani (a subsidiary of the Wind-Down Entity) in Hawaii, which property was destroyed by fire in August 2017.  The Superior Court granted the defendant’s motion for summary judgment, and on March 25, 2021 entered judgment in favor of the defendant.  The judgment provided that plaintiffs take nothing by way of the complaint.  Further, the judgment provided that defendant refund plaintiffs for the premium payments under the insurance policy at issue in the lawsuit ($110,829.43), less all amounts paid by the defendant in respect of claims under the policy ($97,770.38) and less defendant’s costs (defendant requested costs of $9,874.71).  Plaintiffs appealed the judgment. The appeal was fully briefed and oral argument took place before the Court of Appeal on November 21, 2022. After extending its time to rule on the submitted matter, the Court of Appeal entered its ruling on April 19, 2023. In an unpublished opinion, the Court of Appeal affirmed the judgment of the Superior Court and awarded costs on appeal to the respondent Underwriters. Although the Wind Down Entity had a right to petition the California Supreme Court for review, such petitions are rarely granted, and counsel did not believe that there was a realistic chance that the petition would be granted, particularly since the Court of Appeal opinion is unpublished and would not be citable precedent in California. As such, the Court of Appeal opinion became final 30 days after entry, on May 19, 2023.

Part II

Item 5.

Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Part II

Item 7.

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

Pursuant to the Plan, the Trust was formed on February 15, 2019 to hold, either directly or indirectly through the Wind-Down Entity and the Wind-Down Subsidiaries, the assets and equity interests formerly owned by the Debtors. Each of the real properties formerly owned by the Debtors was transferred, on the effective date of the Plan to one of the Wind-Down Subsidiaries. The purpose of the Wind-Down Group is to develop (as applicable), market, and sell those properties to generate cash. Assets formerly owned by the Debtors other than real estate assets and certain cash were transferred to the Trust on the Plan Effective Date. The purpose of the Trust is to receive remittances of cash from the Wind-Down Entity, to resolve disputed claims, to prosecute the Causes of Action, to pay Allowed Administrative Claims and Priority  Claims and subject to the payment of Trust expenses and the retention of various reserves, to make distributions of cash to Interestholders in accordance with the Plan.

The Bankruptcy Court has retained certain jurisdiction regarding the Trust, the Liquidation Trustee, the Supervisory Board, the Wind-Down Entity, the Board of Managers, and assets of the Trust and the Wind-Down Entity, including the determination of all disputes arising out of or related to administration of the Trust and the Wind-Down Entity and its subsidiaries.

(1)

Includes accrued interest of approximately $62,000 and $1.57 million for Restricted for Qualifying Victims and for All Interestholders, respectively.

•

Declared one distribution of $2.18 per Class A Interest, which totaled approximately $25.02 million. Distributions declared were also reduced by approximately $22,000 relating to claims that were denied after the tenth distribution was paid. Distributions declared were reduced by approximately $20,000 that was received from Interestholders that had been overpaid on prior distributions. Distributions declared were increased by approximately $60,000 relating to the first through tenth distributions for a claim that was allowed and for which the Company had not accrued a distribution.

•

Reversed distributions of approximately $2.63 million from claims being disallowed or Class A Interests being cancelled. Distributions that had been previously reversed were recorded of approximately $0.03 million for Interestholders that were previously deemed to have forfeited their rights to receive Class A Interest distributions but had subsequently responded .

•

Sold Forfeited Assets, including an automobile, jewelry, handbags, clothing and shoes for net proceeds of approximately $0.81 million.

•

Sold one single-family home, one other property and settled one secured loan for net proceeds of approximately $26.95 million.

•

Recorded approximately $0.30 million from the settlement of other Causes of Action, net of 5% payable to the Liquidation Trustee.

•

Accrued interest earnings for the period from July 1, 2023 through March 31, 2026 of approximately $1.63 million of which approximately $0.06 million relates to Forfeited Assets and the remaining amount of approximately $1.57 million relates to All Interestholders.

•

As a result of the expected additional time required for the Company to complete its liquidation activities from February 15, 2024 to March 31, 2026, the Company accrued additional accrued liquidation costs of approximately $7.7 million. The additional costs are primarily legal and other professional fees and payroll and payroll-related costs. A portion of the accrued liquidation costs relate to estimated reserves for contingent liabilities, including potential construction defect claims and the administration of such claims after its liquidation activities are completed.

•

Paid construction costs of approximately $1.99 million relating to single-family homes under development.

•

Paid holding costs of approximately $0.68 million.

•

Paid general and administrative costs of approximately $13.25 million, including approximately $0.53 million of board member fees and expenses, approximately $6.92 million of payroll and other general and administrative costs and approximately $5.80 million of professional fees.

(1)

Net of 5% payable to the Liquidation Trustee of approximately $1.24 million for Comerica Bank and $105,000 for other settlement agreements during the year ended June 30, 2022.

(2)

The components of Other are as follows ($ in thousands):

•

Declared three distributions of $3.44, $3.44 and $5.63 per Class A Interest, which totaled approximately $40.02 million, approximately $39.98 million and approximately $65.04 million, respectively and $145.04 million in the aggregate.

•

Reversed distributions of approximately $0.82 primarily from claims being disallowed or Class A Interests being cancelled and reversed distributions of approximately $1.16 million for Interestholders that were deemed to have forfeited their rights to receive Class A Interest distributions.

•

Sold Forfeited Assets including wine, gold, handbags, clothing and shoes for net proceeds of approximately $0.61 million.

•

Completed construction of two single-family homes (642 St. Cloud and 638 Siena).

•

Sold six single-family homes and settled two secured loans for net proceeds of approximately $131.72 million. One of the single-family homes was under construction.

•

Recorded approximately $23.57 million from the settlement of the two pending actions against Comerica Bank, net of 5% payable to the Liquidation Trustee.

•

Recorded approximately $2.00 million from the settlement of other Causes of Action, net of 5% payable to the Liquidation Trustee.

•

Paid construction costs of approximately $13.49 million relating to single-family homes under development.

•

Paid holding costs of approximately $2.67 million.

•

Paid general and administrative costs of approximately $16.17 million, including approximately $0.71 million of board member fees and expenses, approximately $5.77 million of payroll and other general and administrative costs and approximately $9.69 million of professional fees.

---

•

Sales of Real Estate:  As of June 30, 2023, the Company owned a total of two real estate assets (including a promissory note that it plans to hold to maturity) with an estimated net carrying value of approximately $0.77 million. Based on the remaining assets of the Company, future net proceeds will be negligible as compared to the proceeds the Company has realized in prior periods. A transaction for the sale of the property located in Hawaii is currently pending.

•

Causes of Action Recoveries:  During the year ended June 30, 2023, the Company recognized and received approximately $0.30 million from the settlement of Causes of Action. During the period from July 1, 2023 through September 27, 2023, the Company recognized and received approximately $17.41 million, net of litigation costs and attorney fees, from the settlement of Causes of Action.  During the period from July 1, 2023 through September 27, 2023, the Company recorded approximately $1.20 million payable to the Liquidation Trustee, related to the settlement of Causes of Action.  There can be no assurance that the amounts the Company recovers from settling Causes of Action in the future will be consistent with the amount recovered in prior periods.

•

Interest Earnings:  At June 30, 2023, the Company accrued approximately $1.64 million of interest earnings through March 31, 2026.  Of this amount, the Company projects to receive approximately $.93 million of interest earnings through June 30, 2024.

•

Forfeited Assets:  Forfeited Assets consist of cash and other assets (jewelry, art, clothing, handbags and shoes). During the year ended June 30, 2023, the Trust sold some of its Forfeited Assets and received net proceeds of approximately $0.81 million. As noted earlier, net sale proceeds from liquidating the Forfeited Assets are to be distributed only to Qualifying Victims.

							During the Period from February 15, 2019 (inception) through June 30, 2023 ($ in Millions)												During the Period from February 15, 2019 (inception) through September 27, 2023 ($ in Millions)
	Date Declared		$ per Class A Interest				Total Declared				Paid				Restricted Cash Account				Total Declared				Paid				Restricted Cash Account
Distributions Declared
First	3/15/2019		$	3.75			$	44.70			$	42.32			$	2.38			$	44.70			$	42.32				2.38
Second	1/2/2020			4.50				53.44				51.20				2.24				53.44				51.20				2.24
Third	3/31/2020			2.12				25.00				24.19				0.81				25.00				24.19				0.81
Fourth	7/13/2020			2.56				29.97				29.24				0.73				29.97				29.24				0.73
Fifth	10/19/2020			2.56				29.96				29.21				0.75				29.96				29.21				0.75
Sixth	1/7/2021			4.28				50.01				48.67				1.34				50.01				48.67				1.34
Seventh (a)	5/13/2021			2.58				30.04				29.35				0.69				30.04				29.35				0.69
Eighth	10/8/2021			3.44				40.02				39.14				0.88				40.02				39.14				0.88
Ninth	2/4/2022			3.44				39.98				39.15				0.83				39.98				39.15				0.83
Tenth	6/15/2022			5.63				65.02				64.19				0.83				65.02				64.19				0.83
Eleventh	5/10/2023			2.18				25.02				24.90				0.12				25.02				24.90				0.12
Subtotal			$	37.04			$	433.16			$	421.56			$	11.60			$	433.16			$	421.56			$	11.60
Distributions Returned / (Reversed)
Disallowed/cancelled (b)																(6.27	)											(6.31	)
Returned (c)																0.74												0.74
Forfeited (d)																(1.13	)											(1.13	)
Subtotal																(6.66	)											(6.70	)
Distributions Paid from Reserve Account (e)																(3.66	)											(3.66	)
Distributions Payable, Net							as of 6/30/2023:								$	1.28			as of 9/27/2023:								$	1.24

Item 7A.

Quantitative and Qualitative Disclosures About Market Risk

Item 8.

Financial Statements and Supplementary Data

Item 9.

Changes In and Disagreements With Accountants on Accounting and Financial Disclosure

Item 9A.

Controls and Procedures

Item 9B.

Other Information

Item 9C.

Disclosure Regarding Foreign Jurisdictions That Prevent Inspections

(1)	Includes all individuals who may be considered the executive officers of the Trust or the Wind-Down Entity.

(2)

In addition to salary and bonus, the named executive officers (other than Mr. Goldberg) may receive other annual compensation in the form of health, dental, vision and life insurance coverages, paid vacation, paid time off, and other personal benefits.  For fiscal years ended June 30, 2023 and 2022, the total value of health, dental, vision, life insurance coverages and other personal benefits did not exceed $10,000 in the aggregate for any named executive officer.  The amount indicated is for paid vacation and paid time off which were due and payable upon the termination of the full-time employment agreements.

(3)

Mr. Goldberg is eligible for incentive compensation equal to 5% of total gross settlement amounts by the Trust from the pursuit of Causes of Action as further discussed below.  Bonus amounts are attributed to the fiscal year in which they are settled.  During fiscal years ended June 30, 2023 and 2022, $83,160 and $1,424,944, respectively, were paid.

(4)	Bonuses are attributed to the fiscal year in which they are earned.   Mr. Chin, Ms. Fong and Mr. Kemper each were eligible for bonuses through December 31, 2022. The part-time employment agreements that become effective on January 1, 2023 do not provide for bonuses.

(5)	Mr. Chin resigned as Chief Executive Officer effective December 31, 2022 and was replaced by Ms. Fong effective January 1, 2023.

•

the Liquidation Trustee must submit to the Supervisory Board an itemized statement or statements reflecting all fees and itemized costs to be reimbursed;

•

after seven (7) days after the delivery of the statements, the amount reflected in the statements may be paid by the Trust unless, prior to the expiration of such seven-day period, the Supervisory Board has objected in writing to any compensation reflected in the Statement; and

•

in the case of any Supervisory Board objection to payment, the undisputed amounts may be paid, and the disputed amounts may only be paid by agreement of the Supervisory Board, or pursuant to order of the Bankruptcy Court, which retains jurisdiction over all disputes regarding the Liquidation Trustee’s and his or her professionals’ compensation.

(1)

A business address for each of the named beneficial owners is c/o Woodbridge Liquidation Trust, 201 N. Brand Blvd., Suite M, Glendale, California 91203.

(2)

Based on 11,514,578 Class A Interests and 675,617 Class B Interests outstanding as of September 27, 2023.

(3)

As trustee of a family trust.

(4)

Of which 25,485.81 are held individually and the remainder is beneficially owned in an individual retirement account.

(5)

Of which 9,667.03 are held individually and the remainder is beneficially owned in an individual retirement account.

(6)

Of which 13,449.54 are held by a limited liability company of which Ms. Myrick is a member, 10,369.63 are held by a family trust of which Ms. Myrick is a beneficiary.

(7)

Held by a limited liability company, of which Ms. Myrick is a member.

(8)

Beneficially owned together with spouse.

•

any person who is, or at any time since the beginning of the Trust’s last fiscal year was, the Liquidation Trustee, a member of the Supervisory Board, a member of the Board of Managers, an executive officer of the Wind-Down Entity or a nominee to become a member of the Board of Managers or a more than 5% beneficial owner of the Trust;

•

any immediate family member of any of the foregoing persons, which means any child, stepchild, parent, stepparent, spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law of the Liquidation Trustee, a member of the Board of Managers, an executive officer of the Wind-Down Entity, or a nominee to become a member of the Board of Managers, or a more than 5% beneficial owner of the Trust, and any person (other than domestic employees or tenants) sharing the household of any such person; and

•

any firm, corporation or other entity in which any of the foregoing persons is employed or is a partner or principal or in a similar position or in which such person has a 5% or greater beneficial ownership interest.

•

The benefits to the Trust and the Wind-Down Entity;

•

The impact on the independence of a member of the Supervisory Board or the Board of Managers in the event the Related Person is a member of the Supervisory Board, a member of the Board of Managers, an immediate family member of any such member, or an entity in which any such member is a director, officer, manager, principal, member, partner, shareholder or executive officer;

•

The availability of other sources for comparable products or services;

•

The terms of the transaction; and

•

The terms available to unrelated third parties and employees generally.

		Years Ended June 30,
		2023				2022
Audit fees		$	207,900			$	280,800
Audit-related fees			-				-
Tax fees			-				-
All other fees			-				-
Total		$	207,900			$	280,800

•

Audit Fees: These fees for professional services performed for the audit of our annual consolidated financial statements, the required review of quarterly consolidated financial statements, registration statements and other procedures performed by independent auditors in order for them to be able to form an opinion on our consolidated financial statements.

•

Audit-Related Fees: These are fees for assurance and related services that traditionally are performed by independent auditors that are reasonably related to the performance of the audit or review of the consolidated financial statements, such as due diligence related to acquisitions and dispositions, attestation services that are not required by statute or regulation, internal control reviews, and consultation concerning financial accounting and reporting standards.

•

Tax Fees: These are fees for all professional services performed by professional staff in our independent auditor’s tax division, except those services related to the audit of our consolidated financial statements. These include fees for tax compliance, tax planning, and tax advice, including federal, state, and local issues. Services may also include assistance with tax audits and appeals before the IRS and similar state and local agencies, as well as federal, state and local tax issues related to due diligence.

•

All Other Fees:  These are fees for any services not included in the above-described categories, including assistance with internal audit plans and risk assessments.

(1)	Consolidated Financial Statements

	Page
Index to Consolidated Financial Statements	F-1
Audited Consolidated Financial Statements As of and For the Years Ended June 30, 2023 and 2022:
Report of Independent Registered Public Accounting Firm (PCAOB ID 23)	F-2
Consolidated Statements of Net Assets in Liquidation as of June 30, 2023 and 2022	F-3
Consolidated Statements of Changes in Net Assets in Liquidation for the Years Ended June 30, 2023 and 2022	F-4
Notes to Consolidated Financial Statements	F-5

(2)	Financial Statement Schedules

2.1	First Amended Joint Chapter 11 Plan of Liquidation of Woodbridge Group of Companies, LLC and its Affiliated Debtors dated August 22, 2018, incorporated herein by reference to the Registration Statement on Form 10 filed by the Trust on October 25, 2019.
3.1	Certificate of Trust of Woodbridge Liquidation Trust dated February 14 and effective February 15, 2019, incorporated herein by reference to the Registration Statement on Form 10 filed by the Trust on October 25, 2019.
3.2	Liquidation Trust Agreement of Woodbridge Liquidation Trust dated February 15, 2019, as amended by Amendment No. 1 dated August 21, 2019 and Amendment No. 2 dated September 13, 2019, incorporated herein by reference to the Registration Statement on Form 10 filed by the Trust on October 25, 2019.
3.3	Amendment No. 3 to Liquidation Trust Agreement dated as of November 1, 2019, incorporated herein by reference to Amendment No. 1 to Registration Statement on Form 10 filed by the Trust on December 13, 2019.
3.4	Amendment No. 4 to Liquidation Trust Agreement dated as of February 5, 2020, incorporated herein by reference to the Current Report on Form 8-K filed by the Trust on February 6, 2020.
3.5	Amended and Restated Bylaws of Woodbridge Liquidation Trust effective August 21, 2019, incorporated herein by reference to the Registration Statement on Form 10 filed by the Trust on October 25, 2019.
10.1	Limited Liability Company Agreement of Woodbridge Wind-Down Entity LLC dated February 15, 2019, incorporated herein by reference to the Registration Statement on Form 10 filed by the Trust on October 25, 2019.
10.2	First Amendment to Limited Liability Agreement of Woodbridge Wind-Down Entity LLC dated November 30, 2022, incorporated herein by reference to the Current Report on Form 8-K filed by the Trust on December 1, 2022.

10.3	Second Amendment to Limited Liability Agreement of Woodbridge Wind-Down Entity LLC dated as of March 27, 2023, incorporated herein by reference to the Current Report on Form 8-K filed by the Trust on March 29, 2023.
10.4	Third Amendment to Limited Liability Agreement of Woodbridge Wind-Down Entity LLC dated as of April 28, 2023, incorporated herein by reference to the Current Report on Form 8-K filed by the Trust on May 1, 2023.
10.5	Employment Agreement dated November 12, 2019 between Woodbridge Wind-Down Entity LLC and Marion W. Fong, incorporated herein by reference to Amendment No. 1 to Registration Statement on Form 10 filed by the Trust on December 13, 2019.
10.6	First Amendment to Employment Agreement dated September 24, 2020 between Woodbridge Wind-Down Entity LLC and Marion W. Fong, incorporated herein by reference to the Form 10-K filed by the Trust on September 28, 2020.
10.7	Indemnification Agreement dated November 12, 2019 between Woodbridge Wind-Down Entity LLC and Marion W. Fong, incorporated herein by reference to Amendment No. 1 to Registration Statement on Form 10 filed by the Trust on December 13, 2019.
10. 8	Part-Time Employment Agreement dated November 30, 2022 between Woodbridge Wind-Down Entity and Marion W. Fong, incorporated herein by reference to the Current Report on Form 8-K filed by the Trust on December 1, 2022.

10.9	Employment Agreement dated November 12, 2019 between Woodbridge Wind-Down Entity LLC and David Mark Kemper, incorporated herein by reference to Amendment No. 1 to Registration Statement on Form 10 filed by the Trust on December 13, 2019.
10.10	First Amendment to Employment Agreement dated September 24, 2020 between Woodbridge Wind-Down Entity LLC and David Mark Kemper, incorporated herein by reference to the Form 10-K filed by the Trust on September 28, 2020.
10.11	Part-Time Employment Agreement dated November 30, 2022 between Woodbridge Wind-Down Entity and David Mark Kemper, incorporated herein by reference to the Current Report on Form 8-K filed by the Trust on December 1, 2022.
10.12	Indemnification Agreement dated November 12, 2019 between Woodbridge Wind-Down Entity LLC and David Mark Kemper, incorporated herein by reference to Amendment No. 1 to Registration Statement on Form 10 filed by the Trust on December 13, 2019.
10.13	Stipulation and Settlement Agreement between the United States and Woodbridge Liquidation Trust, as approved by order of the United States Bankruptcy Court for the District of Delaware entered September 17, 2020, incorporated herein by reference to the Form 10-K filed by the Trust on September 28, 2020.
10.14	Settlement Agreement dated August 6, 2021 by and among Mark Baker, Jay Beynon as Trustee for the Jay Beynon Family Trust DTD 10/23/1998, Alan and Marlene Gordon, Joseph C. Hull, Lloyd and Nancy Landman, and Lilly A. Shirley on behalf of themselves and the proposed Settlement Class, Michael I. Goldberg, as Trustee for Woodbridge Liquidation Trust, and Comerica Bank, incorporated herein by reference to the Form 10-K filed by the Trust on September 27, 2021.
31.1*	Certification of Liquidation Trustee pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*	Certification of Liquidation Trustee pursuant to 18 U.S.C. 1350, as Adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

99.1	Findings of Fact, Conclusions of Law, and Order Confirming the First Amended Joint Chapter 11 Plan of Liquidation of Woodbridge Group of Companies, LLC and its Affiliated Debtors, entered October 26, 2018, incorporated herein by reference to the Registration Statement on Form 10 filed by the Trust on October 25, 2019.
101	The following financial statements from the Woodbridge Liquidation Trust Annual Report on Form 10-K for the year ended June 30, 2023, formatted in eXtensible Business Reporting Language (XBRL): (i) consolidated statements of net assets in liquidation as of June 30, 2023 and 2022, (ii) consolidated statements of changes in net assets in liquidation for the years ended June 30, 2023 and 2022, (iii) the notes to the consolidated financial statements. XBRL Instance Document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
104	Cover Page Interactive Data File (Formatted as Inline XBRL and contained in Exhibit 101)