Honolulu, May 14, 2003—Hawaiian Airlines, Inc. today filed a motion in bankruptcy court proposing a comprehensive solution to issues raised by the company’s largest aircraft lessor, Boeing Capital Corporation (BCC), and its Creditors’ Committee in a motion seeking to appoint a trustee in the company’s Chapter 11 case. If accepted by the court, the solution would include sweeping changes in the governance of the company, including the resignation of John W. Adams as its chairman and chief executive officer, and the appointment of an examiner in the case.
“What’s most important to me is that Hawaiian Airlines is given every opportunity to complete the last mile of this marathon and emerge the strong competitor that I know it can be,” Adams said.
“The only major stakeholder that hasn’t agreed to participate in Hawaiian’s restructuring is Boeing. While Boeing has said that they want Hawaiian Airlines to remain a customer, the effort they have focused on me is wreaking profound damage on the company, and I can’t allow this to continue.
“Accordingly, the board today approved a number of extraordinary steps that address directly each of the concerns that have been raised by Boeing,” Adams said.
In addition to his stepping down from his board and executive positions if the motion is granted, Adams announced that the motion included the following provisions:
* Mark B. Dunkerley, the airline’s president and chief operating officer, would be appointed CEO of Hawaiian Airlines and join its board.
* Four members of the Hawaiian Airlines board, three of whom have affiliations with Adams and his investment company, AIP LLC, would resign their positions on the board.
* The U.S. Trustee would be asked to nominate two independent members of the Hawaii business community to join the Hawaiian Airlines board.
* Hawaiian Holdings would repay $500,000 previously received from Hawaiian Airlines.
* Termination of the company’s exclusive right to propose a Plan of Reorganization.
Adams said that, having assented to Boeing’s and the Creditors’ Committee’s demands, he had asked them to formally abandon their request for appointment of a trustee to oversee the company’s Chapter 11 case.
“It is important that both Boeing and the Committee recognize that disruption in the day-to-day management of the company risks its ability to successfully restructure. I would gladly accept the appointment of an examiner with the power to bring a cause of action as a much more reasonable and constructive way to resolve issues that have been raised without damaging the business. To do otherwise would be irresponsible to every creditor, employee and customer of Hawaiian Airlines.”
The proposed changes would become effective promptly upon approval of the court.