Hawaiian Holdings redeems remaining $52.3 million of convertibles due 2010

By Angela McDaniels

Seattle, April 26 - Hawaiian Holdings Inc. said it redeemed the $52.3 million outstanding principal amount of its subordinated convertible notes due 2010 on April 21 at 105% plus accrued interest for a total of $55.9 million.

The company used part of the proceeds from its amended term A and term B credit facilities to fund the redemption of the convertibles, which were issued in conjunction with the company's emergence from bankruptcy in June 2005.

"The redemption of these notes helps complete a restructuring of our balance sheet, which commenced in March with the expansion of Hawaiian Airlines' term loan borrowings," chief financial officer Peter Ingram said in a company news release.

"These notes were designed as a bridge financing to facilitate Hawaiian's exit from bankruptcy. With the support of our lenders, we have redeemed the notes and avoided significant dilution to our shareholders had the notes been converted."

The convertibles would have become convertible on June 2 into roughly 12 million shares of the company's common stock at a conversion price of $4.35.

The redemption will result in a one-time charge that will be recognized in the second quarter of 2006 as a result of writing off the remaining unamortized debt discount recorded upon issuance of the notes, according to the release.

Honolulu-based Hawaiian Holdings is the parent company of Hawaiian Airlines Inc.

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