=============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
of the Securities Exchange Act of 1934
March 1, 2004
Date of Report (Date of Earliest Event Reported)
Hawaiian Holdings, Inc.
(Exact name of registrant as specified in its charter)
Delaware 1-31443 71-0879698
(State or other jurisdiction of (Commission File (I.R.S. Employer
incorporation or organization) Number) Identification No.)
885 Third Avenue, 34th Floor
New York, NY 10022
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (212) 888-5500
=============================================================================
ITEM 5. Other Events and Regulation FD Disclosure.
As previously disclosed in the Registrant's Current Report on Form
8-K filed on March 21, 2003, the Registrant's Form 12b-25 filed on March 21,
2003, and the Registrant's Form 12b-25 filed on April 30, 2003, on March 21,
2003 Hawaiian Airlines, Inc. ("Hawaiian Airlines"), the sole operating
subsidiary of the Registrant, filed a voluntary petition for reorganization
under Chapter 11 of the United States Bankruptcy Code (the "Chapter 11
Filing") in the United States Bankruptcy Court for the District of Hawaii (the
"Bankruptcy Court") (Case No. 03-00827).
On March 1, 2004, the Registrant and AIP, LLC ("AIP" and collectively
with the Registrant, the "Plan Proponents") filed a preliminary plan of
reorganization (the "Proposed HHI Plan") with the Bankruptcy Court that
proposes to recapitalize and reorganize Hawaiian Airlines. A copy of the
Proposed HHI Plan is filed as Exhibit 2 hereto and a copy of the press release
issued by the Registrant on March 1, 2004 relating to the Proposed HHI Plan is
filed as Exhibit 99.1 hereto. The Proposed HHI Plan is subject to approval and
confirmation by the Bankruptcy Court and Hawaiian Airlines' creditors. Under
the Proposed HHI Plan, Hawaiian Airlines would emerge from bankruptcy by the
Fall of 2004 and expand into Asia and other markets in the continental United
States.
Under the Proposed HHI Plan, an investor group would make an
investment of not less than $30 million of new capital in Hawaiian Airlines in
exchange for receiving 50% of the fully diluted common stock of the
reorganized Hawaiian Airlines. The investor group would be comprised of AIP,
which is an affiliate of the Registrant, and/or the Registrant through a
rights offering to be offered to all of the Registrant's shareholders, and
other parties who as a result of negotiations with the Plan Proponents would
contribute to the investor group. The Proposed HHI Plan also provides that the
existing equity in Hawaiian Airlines that is owned by the Registrant or any
affiliate, and owned indirectly by the Registrant's shareholders, would
receive 40% of the common stock of the reorganized Hawaiian Airlines, plus
such additional shares as the Registrant and AIP may provide from the shares
of common stock issued to them by the reorganized Hawaiian Airlines.
Also under the Proposed HHI Plan, unsecured creditors holding claims
in excess of $500,000 would receive subordinated notes issued by Hawaiian
Airlines in the aggregate amount of $160 million, plus 10% of the new common
stock of the reorganized Hawaiian Airlines, as well as the right to receive a
pro-rata share of a pre-determined percentage of the net proceeds (if any) in
a proposed litigation trust. Unsecured creditors holding claims up to $500,000
would receive a cash payment of 50% of their allowed claims and their pro rata
share of a pre-determined percentage of the net proceeds (if any) in the
litigation trust. The Proposed HHI Plan also proposes that Hawaiian Airlines
accept aircraft lease terms that Boeing Capital Corporation ("BCC") and
affiliated entities ("Boeing") proposed in the reorganization plan that BCC,
BCC Equipment Leasing Corporation, and Corporate Recovery Group, LLC filed
with the Bankruptcy Court on February 10, 2004, as the Registrant disclosed in
its Current Report on Form 8-K filed February 13, 2004. Boeing is one of
Hawaiian Airlines' largest creditors.
The proposed litigation trust would be administered and overseen by
an independent committee and would receive any recovery resulting from the
litigation that has been commenced by the bankruptcy trustee in the Chapter 11
Filing against Mr. John W. Adams, Chairman and Chief Executive Officer of the
Registrant, the Registrant, and certain affiliates thereof. Such litigation
was disclosed in the Registrant's Current Report on Form 8-K filed December 3,
2003. The litigation trust also would receive any recovery resulting from
potential product warranty claims Hawaiian Airlines may have against certain
Boeing entities with respect to certain aircraft leased from those entities.
Under the Proposed HHI Plan, 65% of the proceeds (if any) received by the
litigation trust would be distributed to creditors of Hawaiian Airlines and
35% would be distributed to the reorganized Hawaiian Airlines.
Under the Proposed HHI Plan, the reorganized Hawaiian Airlines would
continue to be led by Hawaiian Airlines' existing management team, and Mark B.
Dunkerly, currently the President of Hawaiian Airlines, would become the Chief
Executive Officer of the reorganized Hawaiian Airlines. The Registrant's
proposed board of directors would be comprised of nine members and would
include, among others, a chairman to be appointed by the Plan Proponents upon
reasonable approval by Hawaiian Airlines' official committee of unsecured
creditors (the "Creditors Committee"), the chief executive officer of Hawaiian
Airlines, and representatives of Hawaiian Airlines' three major unions. The
Plan Proponents, which includes AIP, would have the right to designate only
one representative to the proposed board of directors. Other directors would
be appointed to the board by the Creditors Committee upon reasonable approval
by the Plan Proponents. Mr. Adams would not have a management position with
Hawaiian Airlines or the Registrant. The Proposed HHI Plan also proposes that
AIP or any other controlling shareholder owning more than 30% of the new
common stock of the reorganized Hawaiian Airlines would enter into a
shareholders agreement designed to mitigate the influence that any such
controlling shareholder could have on the management of Hawaiian Airlines. The
Proposed HHI Plan also contemplates negotiation of a three year contract
extension with Hawaiian Airlines' unions with no wage concessions.
2
The Registrant notes that the Proposed HHI Plan is a preliminary plan
of reorganization and is subject to modification. The Registrant anticipates
filing an enhanced and more detailed plan of reorganization for Hawaiian
Airlines after all those wishing to bid in the bankruptcy proceeding have been
provided access to complete financial and other information related to
Hawaiian Airlines that has heretofore not been made available in the
bankruptcy proceeding. The Registrant further notes that the Proposed HHI Plan
does not include any request for a topping fee bonus for the Registrant or any
other party for having submitted the reorganization plan. As noted in prior
disclosure by the Registrant, the Registrant expects that other reorganization
plans will be submitted to the Bankruptcy Court.
This current report on Form 8-K contains "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995
that reflect the current views of the Registrant with respect to certain
current and future events and financial performance. Such forward-looking
statements are and will be, as the case may be, subject to many risks,
uncertainties and factors relating to the operations and business environments
of the Registrant and Hawaiian Airlines that may cause the actual results of
the Registrant and Hawaiian Airlines to be materially different from any
future results, expressed or implied, in such forward-looking statements.
Factors that could cause actual results to differ materially from these
forward-looking statements include, but are not limited to, the following: the
ability of the Registrant and Hawaiian Airlines to continue as a going
concern; the ability of Hawaiian Airlines to obtain court approval with
respect to motions in the Chapter 11 proceeding prosecuted by it from time to
time; the ability of Hawaiian Airlines to develop, prosecute, confirm and
consummate one or more plans of reorganization with respect to the Chapter 11
case; risks associated with third parties seeking to propose and confirm one
or more plans of reorganization with respect to the Chapter 11 case; risks
associated with the appointment of a Chapter 11 trustee and the ability of the
Chapter 11 trustee to successfully manage the day-to-day operations of
Hawaiian Airlines; risks associated with the Chapter 11 trustee or third
parties seeking to convert the case to a Chapter 7 case; the ability of
Hawaiian Airlines to obtain and maintain normal terms with vendors and service
providers; the ability of Hawaiian Airlines to maintain contracts that are
critical to its operations; the potential adverse impact of the Chapter 11
case on the liquidity or results of operations of the Registrant and Hawaiian
Airlines; the ability of Hawaiian Airlines to fund and execute their business
plan; the ability of the Registrant and Hawaiian Airlines to attract, motivate
and/or retain key executives and associates; the ability of Hawaiian Airlines
to attract and retain customers; demand for transportation in the markets in
which Hawaiian Airlines operates; economic conditions; the effects of any
hostilities or act of war (in the Middle East or elsewhere) or any terrorist
attack; labor costs; financing costs; the cost and availability of aircraft
insurance; aviation fuel costs; security-related costs; competitive pressures
on pricing (particularly from lower-cost competitors); weather conditions;
government legislation and regulation; consumer perceptions of the products of
Hawaiian Airlines; and other risks and uncertainties set forth from time to
time in the Registrant's reports to the U.S. Securities and Exchange
Commission.
Similarly, these and other factors, including the terms of any
reorganization plan ultimately confirmed, can affect the value of the various
pre-petition liabilities of Hawaiian Airlines and the common stock and/or
other equity securities of the Registrant. No assurances can be given as to
what values, if any, will be ascribed in the bankruptcy proceedings to each of
these constituencies, and it is possible that Hawaiian Airline's equity will
be restructured in a manner that will substantially reduce or eliminate any
remaining value in Hawaiian Airline's equity and, therefore, in the
Registrant's equity. In addition, other factors may also affect the liquidity
and value of the Registrant's securities. Such factors include: uncertainty as
to whether, or for how long the Registrant's securities will continue to be
listed or traded on Amex, and the uncertainty whether, should the Registrant's
securities cease to be listed or traded on Amex, a comparable or substitute
trading medium can be found. Accordingly, the Registrant urges that the
appropriate caution be exercised with respect to existing and future
investments in any of these liabilities and/or securities.
3
ITEM 7. Financial Statements and Exhibits.
(a) Financial Statements of Business Acquired.
Not Applicable/None
(b) Pro Forma Financial Information.
Not Applicable/None
(c) Exhibits.
Exhibit Number Document Description
-------------- --------------------
2 Plan of Reorganization Proposed for Hawaiian
Airlines, Inc., dated March 1, 2004.
99.1 Press Release, dated March 1, 2004.
4
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: March 3, 2004 By: Hawaiian Holdings, Inc.
By: /s/ John W. Adams
---------------------
John W. Adams
Chairman of the Board of
Directors and Chief
Executive Officer
5