Woo vs. Harmon - Witness Walter A. Dods, Jr.

David C. Farmer, Successor-Trustee vs. Harmon

(Formerly Woo vs. Harmon & Nicholson vs. Harmon)

U.S. District Court For the District of Hawaii

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DEFENDANT’S WITNESS

WALTER A. DODS, JR.

Walter A. Dods, Jr. is the retired Chairman/CEO of BancWest Corporation and its subsidiary First Hawaiian Bank, a subsidiary of BNP Paribas; Director, Alexander & Baldwin; Director, Maui Land & Pineapple Company, Inc.; Director, Servco Pacific, Inc.; past Chairman, Democratic Campaigns for Senator Dan Inouye and former Gov. George Ariyoshi; Trustee, The Nature Conservancy.

Address to be determined.

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NEW DISCOVERY (09/10/08):

August 17, 2007

Isle investors buying Mid Pac fuel chain

The purchase includes 36 of 51 Union 76 gas stations

By Jennifer Sudick, Star-Bulletin

A group of local investors led by First Hawaiian Bank Chairman Walter Dods Jr. is purchasing Mid Pac Petroleum LLC from a Singaporean investment firm.

Hawaii-based Koko'oha Investments Inc., formed this month by Dods and three other investors, will buy the petroleum distributor and marketer for $44 million from k1 Ventures Ltd. Mid Pac owns 36 of the 51 Union 76-branded gas stations in Hawaii. It is the second time control of the brand and the stations has changed hands in three years.

"It's very rare in Hawaii that a top-50 type company becomes available," Dods said in an interview. "I loved the fact that we were able to bring the company back home."

There will be "no disruption" to the company's 100 employees, he said.

The cash purchase, expected to close Sept. 1, includes Union 76 stations on Oahu, Maui, Kauai and the Big Island, with fuel-supply contracts for Hawaii's independently operated Union 76 stations. The deal also includes Mid Pac's trucking assets, marketing programs, and fueling terminals at Hilo and Kawaihae on the Big Island.

The former longtime First Hawaiian chief executive, who will become chairman of the company, is being joined by David Hulihee, president of Hawaii-based construction company Royal Contracting Company Ltd.; Bill Mills, chairman of Hawaii-based real estate investment company the Mills Group; and Jim Yates, who will serve as president and CEO of Mid Pac.

Yates is stepping down at the end of this month as president and CEO of local natural-gas supplier the Gas Co., where he worked for 12 years.

"This company has been really well run in the last three years since it was started up, so to some extent it will be business as usual," Yates said in an interview. "As compared to a foreign owner, we are just going to be able to offer more to the local community. I'm excited about it."

The investors will have an equal share in the company, Dods said, with no immediate plans for other purchases.

"We take a long-term approach," he said. "We want to build the company. We would love to use the company to buy additional energy-related vehicles over time."

K1 Ventures formed Mid Pac in 2004 -- its second foray into the Hawaii energy market. It acquired the Gas Co., now owned by New York-based Macquarie Infrastructure Co., in 2002.

Mid Pac was ranked as the state's 52nd-largest company with annual sales of $170 million last year in Hawaii Business Magazine's August issue.

Dods, who retired as CEO of First Hawaiian Bank and parent BancWest Corp. in 2004 after 16 years at the helm, teamed with Hulihee and Mills as part of a group of a dozen investors for a $30 million stake in Hawaiian Telcom Communications Inc. A Washington, D.C.-based private-equity firm, the Carlyle Group, acquired Verizon Communications Inc.'s Hawaii assets for $1.6 billion in May 2005, changing the company name from Verizon Hawaii to Hawaiian Telcom.

The three investors and longtime friends also have a majority ownership of Hawaii-based construction material supplier and contractor Grace Pacific Corp., Dods said.

http://starbulletin.com/2007/08/17/news/story09.html

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NEW DISCOVERY (09/10/08):

May 6, 2006

Tesoro agrees to buy 4 gas stations on Garden Island

By Dave Segal, Star-Bulletin

Kauai Petroleum Co. has agreed to sell its four company-owned gas stations, a storage facility at Nawiliwili Harbor and trucking operations to San Antonio-based Tesoro Corp., which operates Hawaii's largest refinery.

Kauai Petroleum, founded in 1948, is a supplier for Union 76. With the deal, Tesoro would be making its first entry into the Kauai market. The company has 33 branded stations on Oahu, Maui and the Big Island. Thirty of those are company operated and three are run by independent dealers.

"I'm glad we're being acquired by a major oil company," Kauai Petroleum General Manager Baltazar Manibog said yesterday. "Part of the reason why the owners wanted to sell is the margin on fuel as a (supplier) is diminishing. To keep up with the changes in the petroleum industry, you have to have more resources and deeper pockets, and we're just a small company."

Kauai Petroleum has nine full-time employees and nine part-timers, according to Manibog.

"They'll offer employment to our present employees they want to retain," he said.

Tesoro, which operates six refineries in the western United States and has more than 475 branded gas stations, said it was interested in Kauai Petroleum because it allows Tesoro to expand and capitalize on its operations in the state.

"Since ... Kauai is the fourth-largest fuel market in Hawaii and has the fastest-growing jet-fuel demand, we believe this acquisition will provide another strategic outlet for our gasoline and jet-fuel production from our (94,000-barrel-a-day) Kapolei facility," said Bruce Smith, chairman, president and chief executive of Tesoro.

Tesoro said it expects to complete its due-diligence review of Kauai Petroleum's assets within 30 days. The acquisition needs to be approved by Kauai Petroleum's three dozen shareholders before it can close.

Manibog said he was confident a majority of shareholders would approve the deal, and Tesoro said it expected the sale to close by the end of next month.

Kauai Petroleum has been hurt by the state gas-cap law that went into effect Sept. 1. The law linked the price of fuel in Hawaii to prices on the mainland and limited the margin that goes from the refinery to the service station.

However, state lawmakers voted this week to indefinitely suspend the gas cap law and allow gasoline companies to charge whatever the market will bear. Gov. Linda Lingle yesterday signed the legislation to suspend the cap, effective immediately.

"With the gas cap and all the changes in the petroleum industry, and the increased government regulations, the owners of the company decided that we should just exit the petroleum industry," Manibog said. "When the gas cap went into effect, I did lose some accounts. And when you lose accounts, your volume decreases."

http://starbulletin.com/2006/05/06/business/story02.html

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May 22, 2004

Isle ties vital to
Verizon buyer

Local investors join a D.C.-based
firm in the $1.65 billion phone
company deal

By Dave Segal, Star-Bulletin

The private-equity Carlyle Group, which announced yesterday it was buying Verizon Hawaii for $1.65 billion, said it wants to return the telephone company to its local roots.

And to prove its commitment, the Washington, D.C.-based company has brought in BancWest Chairman and Chief Executive Walter Dods to lead a group of local investors.

"A big part of our plan is to return Verizon Hawaii to its roots as a local phone company, empowering local management," said William Kennard, Carlyle's managing director and a former Federal Communications Commission chairman. "It's sort of a version of 'Back to the Future,' if you will."

Dods, who will be retiring as chairman and CEO of First Hawaiian Bank and parent BancWest at the end of this year, stressed that his investment is personal and has nothing to do with the bank.

"I'm a strong believer in community involvement, and I've talked to the Carlyle Group (and Kennard) and he strongly agrees with the idea of bringing local community involvement back to Hawaii," Dods said. "I've signed up a group of local investors to be part of the transaction."

Dods declined to divulge any of their names.

But Kennard said the group of local business people Dods assembled represents a cross section of business, banking, various retail operations, real estate and hospitality.

"The notion here is that we're just not paying lip service to the desire to reconnect to the local community," Kennard said. "We want local business leaders investing alongside of us."

The Carlyle Group, which has more than $19 billion under management, already has a presence in Hawaii through Horizon Lines LLC, which it purchased from CSX Corp. for $300 million last year. Horizon is the second-biggest ocean shipping operator in the state behind Matson Navigation Co.

"We think that this is a great market, and we're excited about the prospect of investing more money here," Kennard said.

Kennard wouldn't break down the cash and debt structure of the deal with parent company Verizon Communications Inc., but a source familiar with the situation said that each local investor is putting in at least $1 million.

Kennard said the Carlyle Group is still evaluating the current management team and isn't ready yet to make any decisions. Verizon Hawaii is headed by Melvin Horikami, who took over as president for the retired Warren Haruki in September. Kennard wouldn't say whether Haruki was involved with the Carlyle purchase, but other sources said Haruki will play a role.

Kennard said all of Verizon Hawaii's employees will retain their jobs, and there eventually will be an increase in the work force as Carlyle brings back to Hawaii jobs that had been handled on the mainland by Verizon's parent.

Kennard said the former GTE Hawaiian Tel, which was renamed Verizon Hawaii in 2000 when GTE Corp. merged with Bell Atlantic, also will get a new name.

"We don't have a name we can disclose right now, but I can assure you it will be a name that conveys the local character of the company," Kennard said.

The transaction, which Kennard said had been eight months in the making, needs approval from the state Public Utilities Commission, the FCC and the U.S. Department of Justice. He said he was optimistic that Carlyle could receive PUC approval by the end of this year and that the deal could close early in the first quarter. Kennard said he hopes to file an application with the PUC within a month.

Kris Nakagawa, chief legal counsel for the PUC, said complex cases such as the Carlyle-Verizon Hawaii deal normally take six months to a year for the three-member commission to render a decision. He said there was no way now to offer a precise timetable since there are certain statutes and rules that Carlyle must follow. Nakagawa also said objections from other parties could extend the decision-making process.

The Carlyle Group said the deal includes Verizon Hawaii's local telephone operations, print directory, long-distance operations and Internet service provider business.

Verizon Wireless operations and assets in Hawaii are not included in the transaction. Verizon also will retain two units in the state that provide services for federal government customers: Verizon Federal Network Systems and Verizon Federal Inc.

Verizon Hawaii, which has about 1,700 employees, had sales last year of $610 million, operating income of $58 million and depreciation expense of $111 million. The company has 707,000 local phone lines.

"We will offer new services to our customers, including expanded broadband, and we expect to add many new jobs after the acquisition," Kennard said. "Importantly, rates will stay the same as we reposition the business as a true local company."...

Carlyle Group

The global investment firm buys companies around the world, with a concentration in communications.

Offices: Headquarters in Washington, D.C., 23 offices in 14 countries

Assets: $19 billion under management

Portfolio companies: More than 150,000 employees and $31 million in revenues

Hawaii presence: Purchased shipper Horizon Lines LLC from CSX Corp. for $300 million last year.

Managing director: Former Federal Communications Commission Chairman William Kennard

Prominent advisers: Former President George H.W. Bush; former British Prime Minister John Major; former U.S. Secretary of State James A. Baker, III; former U.S. Secretary of Defense Frank C. Carlucci; former U.S. Speaker of the House and Ambassador to Japan Thomas S. Foley

Web site: www.carlyle.com

http://starbulletin.com/2004/05/22/news/story2.html

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October 1, 1996

Here comes Walter Dods.

By Streeter, ABA Banking Journal

Walter Dods keeps a dog outside his office. Not a live dog , but a modest-sized sculpture of one that the bank purchased from a local artist. The vaguely oriental-looking animal wears a curious expression. It almost seems to be smiling, yet the look also suggests tenacity. Not everyone at the bank likes the dog, but Dods does. And so there it sits on a cube at the entrance to his outer office.

If you were to spend three days observing and trying to keep up with the fast-moving chairman and chief executive officer of First Hawaiian, Inc., you might sense that the sculpture and its caretaker are kindred spirits.

The man who will be president of the American Bankers Association for the next 12 months is an affable, down-to-earth fellow who is at home speaking with anyone. At the same time, he is by all indications an aggressive competitor, a hands-on manager with an almost uncanny grasp of detail, and a boss who gives his subordinates free rein to innovate, but also holds them accountable. Thus, like the sculpture outside his office, there's a certain yin and yang to Walter Dods--personable yet demanding....

Hawaiian Horatio Alger

Walter A. Dods, Jr., 55, is the oldest of seven children. His father was a policeman and his mother worked as a cashier at a Waikiki restaurant--both are retired now.

A 1970 Honolulu magazine article about Dods (he was then 29 and a newly minted First Hawaiian VP), described the Dods family as very close. Everyone learned to hustle early because, as Dods put it, "The last one to the table got the leftovers." That hustle has never left him.

Beginning at about 14, Dods paid his own way working nights and weekends at service stations, Chinese restaurants, a pineapple cannery – sometimes one place during the day and another at night in the summer months.

True, some of Dods' earnings went toward souping up cars--the policeman's son even admits to some hot rodding and drag racing as a teenager. He's long since rechanneled that energy, but an interest in cars remains. He owns a 1957 Ford Thunderbird (the type with "portholes" in the hardtop), which he bought from James MacArthur of the "Hawaii Five-O" television show.

When Dods graduated high school, his father urged him to go to college. But, says Dods, "I was too 'smart' to go to school, so I went to work instead." His first full-time job was as dead files clerk at First Insurance Co. Gradually Dods realized his mistake and began taking night classes to get a college degree.

Doris also did a five-year stint in community relations and advertising at Dillingham Construction Co. before answering an ad for public relations director at First Hawaiian Bank. He landed the job and was promoted four times within 23 months, becoming vice-president for advertising, public relations, and business development by age 29. In the process he caught the attention of First Hawaiian CEO John Bellinger....

http://www.allbusiness.com/finance/579261-1.html

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Walter Dods is expected to testify regarding his business, professional and personal relationships with Kamehameha Schools/Bishop Estate; Oswald Stender; Kamehameha Schools Pension Plan; Maryanne Inouye; J. Michael Shepherd; BNP Paribas; Kroll Associates; Marsh & McLennan; The Nature Conservancy; Dee Jay Mailer; Faye Watanabe Kurren; Haunani Apoliona; George Ariyoshi; Dan Inouye; Daniel Akaka; John Waihee; Ben Cayetano; Margery Bronster; Mark Fukunaga; Servco Insurance Services; Island Insurance Company; Mark Polivka; Puna Chillingworth; Anton C. Krucky; Tissue Genesis, Inc.; Earl Anzai; Linda Lingle; Lawrence M. Johnson; Robin Campaniano; AIG; Robert K.U. Kihune; Gilbert Tam; Sandwich Isles Communications; Steven Guttman; Mary Lou Woo; Judith Neustadter Fuqua; James Duca; Summit Communications; Hawaii Community Foundation; John Marshall; The Queen Emma Foundation; Peter Savio; Harold C. Johnston; Grant Johnston; Chad Johnston; Al Hee; Francis Keala; GTE Hawaiian Tel; Warren Haruki; Greg Pai; Dwayne Steele; Micah Kane; Hawaiian Insurance Companies; Crystal Rose; Aloha Airlines; John Goemans; Colbert Matsumoto; Jeffrey Watanabe; Marsh & McLennan; Robin Campaniano, AIG; Duncan MacNaughton; David Cole; Maui Land & Pineapple; Steve Case; Ed Case; Jeffrey Case; Aon Insurance; Donna Tanoue; Kirk Caldwell; Alexander & Baldwin, Inc.; Chester Dods; Robert Dods; Darren Ah Chong, David Farmer, Steven Guttman, and others to be named upon discovery.