Seven years later, shareholders left out of the $25 million tender offer from Hawaiian Airlines' parent company in June 2002 finally are going to get some payback.

The Securities and Exchange Commission said yesterday it has put together a distribution plan for $2.47 million, plus subsequent interest, that it collected in 2004 in a settlement with Hawaiian Holdings Inc.'s then-Chairman and Chief Executive John Adams and AIP LLC, the former controlling shareholder of the company.

Adams and AIP were charged with failing to update material information published in Hawaiian's tender offer documents in mid-2002 concerning Hawaiian's ability to afford the tender offer and remain solvent. Adams and AIP, an entity managed by Adams, received more than $17 million of the $25 million tender offer, which was initiated shortly after Hawaiian received a $30.1 million federal grant as compensation for losses it suffered following the Sept. 11, 2001, terrorist attacks. Shareholders who accepted the tender offer received $4.25 a share, a 31 percent premium over the stock's price at the time of $3.25.

Hawaiian filed for bankruptcy in March 2003—less then a year after the tender offer—and Adams was removed from his position in May 2003 by federal Bankruptcy Judge Robert Faris, who said Adams placed the interests of shareholders ahead of those of creditors.

In the SEC settlement, Adams agreed to pay $4,184, and AIP paid just under $2.47 million. The money collected has been sitting in an escrow account for five years.

“;We're glad to see this long-standing issue between former CEO John Adams and the SEC has finally been settled and that these shareholders will benefit from the settlement,”; Hawaiian said.

Shareholders who held Hawaiian's outstanding stock at the close of the market on June 27, 2002, who did not tender their shares to Hawaiian in the tender offer or who tendered their shares but withdrew that tender before they were purchased are eligible to share in the distribution. Those shareholders will receive a pro rata distribution from the escrow fund.

Tracy Davis, assistant regional director in the San Francisco office of the SEC, said the reason for the length of time between the settlement and the distribution is that “;it takes time to set up the process and to make sure the correct individuals are identified to receive payment.”;