Company seeking approval to nearly double common stocks
By GREG WILES, The Honolulu Advertiser
Maui Land & Pineapple Co. is seeking shareholder approval to almost double the amount of its authorized common stock as it contemplates financing alternatives to pay down debt and raise money.
The company is proposing increasing the authorized shares to 43 million from the current 23 million, according to proxy material filed with the U.S. Securities and Exchange Commission.
The proposed increase comes after the company reported losses totaling $202.7 million during the past two years and the exit from the pineapple business on which it was built.
Maui Land had previously noted that it might have to sell shares as it looked to generate additional cash, use stock in compensation plans and make acquisitions.
"Our cash outlook for the next 12 months and ability to continue to meet our financial covenants under our credit facilities is highly dependent on generating additional capital, including the sale of equity," said the filing.
The filing said the company has no definite plans for the shares should they be authorized, but that it may need to sell shares in excess of its current authorized number.
This would be needed to facilitate meeting obligations as well as its ability to redeem $40 million of convertible notes that become redeemable in July 2011.
Maui Land’s annual shareholders meeting is scheduled for 8:30 a.m. May 13 at the Kapalua Village Center in West Maui.
Shareholders are also being asked to approve a downsizing of the company’s board as part of its effort to simplify its operations and reduce costs.
Maui Land would shrink its board to seven directors from the current nine under the proposal to be considered, with four current directors giving up their seats and two new people being added.
Warren Haruki, interim chief executive officer since May 2009, would receive a director’s seat, as would Arthur Tokin, who was the managing member of the Honolulu office of accounting firm PricewaterhouseCoopers.
Steve Case, David Heenan, Kent Lucien, Duncan MacNaughton and Fred Trotter III would remain on the board. Nonemployee directors were each paid a $27,000 cash retainer last year.
Leaving the board would be John Agee, former ML&P CEO David Cole, Walter Dods Jr. and Miles Gilburne if the measure is passed.