Creditors support new
plan for airline

A group of Hawaiian Airlines creditors is throwing its support behind a new reorganization plan for the bankrupt airline, the first to allow the creditors to recoup 100 percent of their claims against the carrier.

Joshua Gotbaum, the court-appointed trustee overseeing the airline's re-emergence from bankruptcy, said yesterday the Official Committee of Unsecured Creditors has endorsed the plan unveiled on Thursday. This is the first time the committee has endorsed one of the several plans expected for Hawaiian.

"The endorsement confirms that the plan we're proposing, which could be the first in the airline industry to pay all of the company's debts, is the right course for Hawaiian Airlines," Gotbaum said.

An attorney representing the creditors committee confirmed that it was on board.

The reorganization plan, reached by Gotbaum and the airline's parent, Hawaiian Holdings Inc., will be filed with U.S. Bankruptcy Court.

The plan allows unsecured creditors -- a range of vendors that had offered goods and services to Hawaiian on credit -- full recovery of their claims through a choice of either 100 percent in cash or 50 percent cash and 50 percent stock.

Previous reorganization proposals fell short of offering 100 percent recovery.

Hawaiian's aircraft lessors -- its largest creditors -- also would receive full payment, either through a 50/50 cash/stock arrangement or a long-term note from Hawaiian. Those creditors have yet to comment on the plan.

Hawaiian faces $250 million to $300 million in total claims.

The plan was developed largely by Larry Hershfield, chairman of Hawaiian Holdings and chief executive of Ranch Capital LLC.

Ranch Capital LLC is the managing member of RC Aviation LLC, which owns 35 percent of Hawaiian Holdings and has committed to invest more than $160 million to purchase claims and reorganize the carrier.