UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 11, 2006
ALEXANDER & BALDWIN, INC.
(Exact name of registrant as specified in its charter)
Hawaii 0-565 99-0032630
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(State or other jurisdiction (Commission File Number) (I.R.S. Employer
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of incorporation) Identification No.)
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822 Bishop Street, P. O. Box 3440
Honolulu, Hawaii 96801
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(Address of principal executive office and zip code)
(808) 525-6611
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(Registrant's telephone number, including area code)
Not Applicable
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(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
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|_| Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
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|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
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|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
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|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an
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Off-Balance Sheet Arrangement of a Registrant.
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On October 11, 2006, Alexander & Baldwin, Inc. ("A&B"), MLR Golf
Partners LLC ("MLR"), and BH/JP Hawaii Holdings LLC ("Brookfield") entered into
an Indemnification Agreement (the "Agreement"). The Agreement was entered into
in connection with Brookfield's execution of an indemnity agreement or
agreements (collectively, "Indemnity Agreement") in favor of The Guarantee
Company of North America ("The Guarantee"). The Indemnity Agreement relates to,
among other things, The Guarantee's execution of an agreement with MLR for the
delivery of one or more bonds. MLR is a real-estate development joint venture
that is developing a 30.5-acre residential project in the Mauna Lani Resort on
the island of Hawaii (the "Project"). The joint venture is more fully described
in A&B's most recently filed Form 10-K. Under the Indemnity Agreement,
Brookfield agrees to indemnify The Guarantee from all loss and expense in
connection with any bonds for which it serves as surety for MLR.
Under the Agreement, the parties agree that MLR shall be responsible
for 100% of all payments related to the Project required to be made under the
Indemnity Agreement, and Brookfield and A&B shall each be proportionately liable
(50% for Brookfield and 50% for A&B) for all payments related to the Project
required to be made under the Indemnity Agreement if MLR fails to timely pay
amounts due to The Guarantee. Under the Indemnity Agreement, the maximum
potential amount of aggregate future payments is a function of the amount
covered by outstanding bond(s) at the time of default, reduced by the amount of
work completed. Based on current projections, bonds with an aggregate value of
approximately $71 million are anticipated to be issued and retired over the
construction period. However, the total amount of bonds outstanding at any point
in time is not currently anticipated to exceed approximately $33 million. In
other words, assuming an event of default where the maximum amount of bonds are
issued and no work is completed, the maximum potential amount of aggregate
future payments under the Indemnity Agreement for the Project is currently
projected at approximately $33 million. In that instance, the maximum potential
amount of aggregate future payments for A&B under the Agreement would be
approximately $16.5 million.
Statements in this Form 8-K that are not historical facts are
"forward-looking statements" that involve a number of risks and uncertainties
that could cause actual results to differ materially from those contemplated by
the relevant forward-looking statement. Factors that could cause actual results
to differ materially from those contemplated in the statements include, without
limitation, those described in the most recently filed Form 10-K.
SIGNATURE
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Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: October 16, 2006
ALEXANDER & BALDWIN, INC.
/s/ Christopher J. Benjamin
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Christopher J. Benjamin
Senior Vice President, Chief Financial
Officer and Treasurer