Hawaiian Airlines, Boeing Reach Agreement

HONOLULU - Hawaiian Airlines and Boeing Capital Corp. on Thursday announced an agreement to restructure long-term leases which will allow the state's largest carrier to continue operating 14 Boeing-owned jets.

"This agreement is good for both Hawaiian Airlines and Boeing. It means we have the aircraft we need at lease rates we can afford," Hawaiian trustee Joshua Gotbaum said in a statement. "It's another important step toward Hawaiian's successful exit from bankruptcy."

Terms of the new leases were not disclosed.

The Honolulu-based airline filed for Chapter 11 bankruptcy protection in March 2003 after its former management was unable to reduce its leases with Boeing.

Hawaiian leases 11 Boeing 717-200 planes and three Boeing 767-300ER aircraft from Boeing Capital, the financial arm of Seattle-based aircraft maker Boeing Co. Hawaiian also leases seven Boeing 767-300ER from Ansett Worldwide Aviation Services and four others from International Lease Finance Corp.

Boeing Capital also has agreed to sell its unsecured claim resulting from the bankruptcy to RC Aviation LLC. The amount of the claim was not disclosed.

RC Aviation is a unit of Ranch Capital LLC, which purchased the majority share in the carrier's parent company, Hawaiian Holdings Inc., in June for $41.4 million.

Selling the unsecured claim strengthens the joint-bankruptcy reorganization plan proposed by Gotbaum, RC Aviation and the unsecured creditors committee.

Scott Scherer, a Boeing Capital vice president, called the plan a "comprehensive financial solution that strikes a good balance among the interests of Hawaiian Airlines, Boeing Capital and all other stakeholders."

Two other groups _ Hawaiian Investment Partners Group and Madison Air Partners LLC, a unit of New York-based investment banking firm Jefferies & Co. _ also have submitted recovery plans for the carrier.

Boeing Capital and Corporate Recovery Group last week abandoned its joint plan filed earlier this year.

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Hawaiian Airlines: http://hawaiianair.com/