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                                 UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION

                            Washington, D.C. 20549

                                   FORM 10-K

                   [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                      THE SECURITIES EXCHANGE ACT OF 1934

                  For the fiscal year ended December 31, 2001
                         Commission file number 0-565

                           ALEXANDER & BALDWIN, INC.
            (Exact name of registrant as specified in its charter)

                       Hawaii                  99-0032630
                   (State or other
                    jurisdiction                 (I.R.S.
                 of incorporation or      Employer Identification
                    organization)                 No.)

                               822 Bishop Street
                 Post Office Box 3440, Honolulu, Hawaii 96801
             (Address of principal executive offices and zip code)

                                 808-525-6611
             (Registrant's telephone number, including area code)

          Securities registered pursuant to Section 12(b) of the Act:
                                     None

          Securities registered pursuant to Section 12(g) of the Act:
                        Common Stock, without par value
                               (Title of Class)

      Number of shares of Common Stock outstanding at February 14, 2002:
                                  40,606,808

 Aggregate market value of Common Stock held by non-affiliates at February 14,
                                     2002:
                                 $937,859,339

   Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.       Yes X    No
                                                   ---     ---

   Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [X]

                      Documents Incorporated By Reference
Portions of Registrant's Proxy Statement dated March 11, 2002 (Part III of Form
                                    10-K).


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                               TABLE OF CONTENTS



                                               PART I
                                                                                                 Page
                                                                                                 ----
                                                                                        
Items 1. & 2.    Business and Properties........................................................   1

   A.            Ocean Transportation...........................................................   1
                 (1)  Freight Services..........................................................   1
                 (2)  Vessels...................................................................   2
                 (3)  Terminals.................................................................   2
                 (4)  Other Services............................................................   4
                 (5)  Competition...............................................................   4
                 (6)  Labor Relations...........................................................   5
                 (7)  Rate Regulation...........................................................   5

   B.            Property Development and Management............................................   5
                 (1)  General...................................................................   5
                 (2)  Planning and Zoning.......................................................   6
                 (3)  Residential Projects......................................................   6
                 (4)  Commercial and Industrial Properties......................................   8

   C.            Food Products..................................................................  11
                 (1)  Production................................................................  11
                 (2)  Marketing of Sugar and Coffee.............................................  12
                 (3)  Competition and Sugar Legislation.........................................  12
                 (4)  Properties and Water......................................................  13

   D.            Employees and Labor Relations..................................................  14

   E.            Energy.........................................................................  15

Item 3.    Legal Proceedings....................................................................  15

Item 4.    Submission of Matters to a Vote of Security Holders..................................  16

Executive Officers of the Registrant............................................................  16

                                               PART II

Item 5.    Market for Registrant's Common Equity and Related Stockholder Matters................  16

Item 6.    Selected Financial Data..............................................................  18

Item 7.    Management's Discussion and Analysis of Financial Condition and Results of Operations  19

Item 7A.   Quantitative and Qualitative Disclosures About Market Risk...........................  25

Item 8.    Financial Statements and Supplementary Data..........................................  26

Item 9.    Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.  57


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                                    PART III
                                                                            Page
                                                                            ----
Item 10.   Directors and Executive Officers of the Registrant..............  58

    A.     Directors.......................................................  58

    B.     Executive Officers of the Registrant............................  58

Item 11.   Executive Compensation..........................................  59

Item 12.   Security Ownership of Certain Beneficial Owners and Management..  59

Item 13.   Certain Relationships and Related Transactions..................  59

                                    PART IV

Item 14.   Exhibits, Financial Statement Schedules, and Reports on Form 8-K  60

    A.     Financial Statements............................................  60

    B.     Financial Statement Schedules...................................  60

    C.     Exhibits Required by Item 601 of Regulation S-K.................  60

    D.     Reports on Form 8-K.............................................  65

Signatures.................................................................  66

Independent Auditors' Consent..............................................  68


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                           ALEXANDER & BALDWIN, INC.

                                   FORM 10-K

                       Annual Report for the Fiscal Year
                            Ended December 31, 2001

                                    PART I

ITEMS 1 AND 2.  BUSINESS AND PROPERTIES

   Alexander & Baldwin, Inc. ("A&B") is a diversified corporation with most of
its operations centered in Hawaii. It was founded in 1870 and incorporated in
1900. Ocean transportation operations and related shoreside operations of A&B
are conducted by a wholly-owned subsidiary, Matson Navigation Company, Inc.
("Matson"), and several Matson subsidiaries. Real property and food products
operations are conducted by A&B and certain other wholly-owned subsidiaries of
A&B.

   The industry segments of A&B are as follows:

    A. Ocean Transportation--carrying freight, primarily between various ports
       on the United States Pacific Coast and major Hawaii ports and Guam;
       chartering vessels to third parties; providing terminal, stevedoring and
       container equipment maintenance services in Hawaii; arranging intermodal
       transportation in North America; and providing supply and distribution
       services.

    B. Property Development and Management--purchasing, developing, selling,
       managing and leasing retail, office, industrial, commercial and
       residential properties, in Hawaii and on the U.S. Mainland.

    C. Food Products--growing sugar cane and coffee in Hawaii; producing bulk
       raw sugar, specialty food-grade sugars, molasses and green coffee;
       marketing and distributing roasted coffee and green coffee; providing
       sugar and molasses hauling and storage, general freight and petroleum
       hauling in Hawaii; and generating and selling electricity.

   For information about the revenue, operating profits and identifiable assets
of A&B's industry segments for the three years ended December 31, 2001, see
Note 14 ("Industry Segments") to A&B's financial statements in Item 8 below.

DESCRIPTION OF BUSINESS AND PROPERTIES

  A.  Ocean Transportation

  (1)  Freight Services

   Matson's Hawaii Service offers containership freight services between the
ports of Los Angeles, Oakland, Seattle, and the major ports in Hawaii, which
are located on the islands of Oahu, Kauai, Maui and Hawaii. Roll-on/roll-off
service is provided between California and the major ports in Hawaii. Container
cargo also is received at and delivered to Portland, Oregon, and moved overland
between Portland and Seattle at no extra charge.

   Matson is the principal carrier of ocean cargo between the United States
Pacific Coast and Hawaii. In 2001, Matson carried 149,636 containers (compared
with 151,496 in 2000) and 122,389 motor vehicles (compared with 132,186 in
2000) between those destinations. In response to a weakening Hawaii economy and
declining demand, Matson reduced its Hawaii Service fleet from eight vessels to
seven vessels in January 2002. Principal westbound cargoes carried by Matson to
Hawaii include refrigerated commodities, dry containers of mixed commodities,

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packaged foods, motor vehicles, and building materials. Principal eastbound
cargoes carried by Matson from Hawaii include motor vehicles, household goods,
canned pineapple, refrigerated containers of fresh pineapple, and dry
containers of mixed commodities. The preponderance of Matson's Hawaii Service
revenue is derived from the westbound carriage of containerized freight and
motor vehicles.

   Matson's Guam Service provides containership freight service between the
United States Pacific Coast and Guam and Micronesia. Matson's Guam Service is a
component of the Pacific Alliance Service, a strategic alliance established in
1996 by Matson and American President Lines, Ltd. ("APL") to provide freight
service between the United States Pacific Coast and Hawaii, Guam, and several
Far East ports. In 2001, Matson carried 17,225 containers (compared with 18,165
in 2000) and 2,750 automobiles (compared with 2,616 in 2000) in the Guam
Service. The alliance currently utilizes five vessels (three Matson vessels and
two APL vessels) in a schedule which provides service from the United States
Pacific Coast to Guam and Micronesia, continuing through Far East ports, and
returning to California.

   Matson's Mid-Pacific Service offers container and conventional freight
service between the United States Pacific Coast and the ports of Kwajalein,
Ebeye and Majuro in the Republic of the Marshall Islands and Johnston Island,
all via Honolulu.

   See "Rate Regulation" below with respect to Matson's freight rates.

  (2) Vessels

   Matson's cargo fleet consists of eleven containerships, two combination
container/trailerships, one roll-on/roll-off barge, two container barges
equipped with cranes which serve the neighbor islands of Hawaii and one
container barge equipped with cranes in the Mid-Pacific Service. These
seventeen vessels represent an investment of approximately $694,618,000
expended over the past 31 years. The majority of vessels in the Matson cargo
fleet have been acquired with the assistance of withdrawals from a Capital
Construction Fund established under Section 607 of the Merchant Marine Act,
1936, as amended. Matson's fleet is aging and includes six vessels that will be
between 29 and 32 years old in 2002. During 2001, Matson actively began
pursuing vessel replacement alternatives.

   Currently, three containerships are time-chartered to APL in connection with
the Pacific Alliance Service. Two container/trailerships previously
bareboat-chartered to Sea Star Line, LLC, which operates the vessels in the
Florida-Puerto Rico trade, and in which Matson has a minority investment
interest, were sold to Sea Star Line, LLC in January 2002.

   Matson's fleet units are described on the list on the following page.

   As a complement to its fleet, Matson owns approximately 15,000 containers,
10,670 container chassis, 730 auto-frames and miscellaneous other equipment.
Capital expenditures by Matson in 2001 for vessels, equipment and systems
totaled approximately $28,000,000.

  (3) Terminals

   Matson Terminals, Inc. ("Matson Terminals"), a wholly-owned subsidiary of
Matson, provides container stevedoring, container equipment maintenance and
other terminal services for Matson and other ocean carriers at its 108-acre
marine terminal in Honolulu. Matson Terminals owns and operates seven cranes at
the terminal, which handled 383,506 containers in 2001 (compared with 402,500
in 2000) and can accommodate three vessels at one time. In 2001, Matson
Terminals substantially completed a $32 million terminal improvement project at
the Honolulu terminal, which included the conversion from a straddle
carrier-based container handling system to a wheeled chassis-based system. The
conversion is expected to increase terminal storage density, improve
productivity, and reduce costs. Matson Terminals' lease with the State of
Hawaii runs through September 2016.

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                        MATSON NAVIGATION COMPANY, INC.
                                 FLEET--2/1/02



                                                                                             Usable Cargo Capacity
                                                                            --------------------------------------------
                                                                                     Containers              Vehicles
                                      Year              Maximum   Maximum   ----------------------------- --------------
                     Official Year   Recon-              Speed  Deadweight                Reefer
Vessel Name           Number  Built structed   Length   (Knots) (Long Tons) 20' 24'  40'  Slots  TEUs (1) Autos Trailers
- -----------          -------- ----- -------- ---------- ------- ----------- --- --- ----- ------ -------- ----- --------
                                                                         
Diesel-Powered Ships
- --------------------
R.J. PFEIFFER.......  979814  1992               713'6"  23.0     27,100     48 171   988  300    2,229     --     --
MOKIHANA (2)........  655397  1983               860'2"  23.0     30,167    182   0 1,340  408    2,824     --     --
MAHIMAHI (2)........  653424  1982               860'2"  23.0     30,167    182   0 1,340  408    2,824     --     --
MANOA (2)...........  651627  1982               860'2"  23.0     30,187    182   0 1,340  408    2,824     --     --
Steam-Powered Ships
- -------------------
KAUAI...............  621042  1980    1994   720'5 1/2"  22.5     26,308     -- 458   538  300    1,626     44     --
MAUI................  591709  1978    1993   720'5 1/2"  22.5     26,623     -- 458   538  300    1,626     --     --
MATSONIA............  553090  1973    1987       760'0"  21.5     22,501     16 128   771  201    1,712    450     56
LURLINE.............  549900  1973    1982       826'6"  21.5     22,213      6 162   713  292    1,379    220     81
EWA (3).............  530140  1972    1978       787'8"  21.0     38,747    286 276   681  228    1,979     --     --
CHIEF GADAO.........  530138  1971    1978       787'8"  21.0     37,346    230 464   597  274    1,981     --     --
LIHUE...............  530137  1971    1978       787'8"  21.0     38,656    286 276   681  188    1,979     --     --
MANULANI............  528400  1970           720'5 1/2"  22.5     27,109     26 160   659  221    1,536     --     --
MANUKAI (3).........  524219  1970           720'5 1/2"  22.5     27,107     -- 537   416  251    1,476     --     --
Tugs and Barges
- ---------------
WAIALEALE (4).......  978516  1991               345'0"    --      5,621     --  --    --   35       --    230     45
ISLANDER (5)........  933804  1988               372'0"    --      6,837     -- 276    24   70      380     --     --
MAUNA LOA (5).......  676973  1984               350'0"    --      4,658     -- 144    72   84      316     --     --
HALEAKALA (5).......  676972  1984               350'0"    --      4,658     -- 144    72   84      316     --     --





                      Molasses
                     ----------

Vessel Name          Short Tons
- -----------          ----------
                  
Diesel-Powered Ships
- --------------------
R.J. PFEIFFER.......      --
MOKIHANA (2)........      --
MAHIMAHI (2)........      --
MANOA (2)...........      --
Steam-Powered Ships
- -------------------
KAUAI...............   2,600
MAUI................   2,600
MATSONIA............   4,300
LURLINE.............   2,100
EWA (3).............      --
CHIEF GADAO.........      --
LIHUE...............      --
MANULANI............   5,300
MANUKAI (3).........   5,300
Tugs and Barges
- ---------------
WAIALEALE (4).......      --
ISLANDER (5)........      --
MAUNA LOA (5).......   2,100
HALEAKALA (5).......   2,100

- --------
(1) "Twenty-foot Equivalent Units" (including trailers). TEU is a standard
    measure of cargo volume correlated to the volume of a standard 20-foot dry
    cargo container.
(2) Time-chartered to APL until February 2006.
(3) Reserve Status
(4) Roll-on/Roll-off Barge
(5) Container Barge

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   SSA Terminals, LLC, a joint venture formed by Matson and Stevedoring
Services of America in July 1999, provides terminal and stevedoring services at
West Coast terminal facilities in Los Angeles, Long Beach, Oakland and Seattle.

   Capital expenditures incurred by Matson Terminals for terminals and
equipment totaled approximately $31,100,000 in 2001.

  (4) Other Services

   Matson Intermodal System, Inc. ("Matson Intermodal") is an intermodal
marketing company which arranges North American rail and truck transportation
for shippers and carriers, frequently in conjunction with ocean transportation.
Through volume purchases of rail and motor carrier transportation services,
augmented by such services as shipment tracing and single-vendor invoicing,
Matson Intermodal is able to reduce transportation costs for customers. Matson
Intermodal currently has 40 offices and manages 30 equipment depots across the
United States Mainland.

   In July 2001, Matson Services Company, Inc. ("Matson Services"), a
wholly-owned subsidiary of Matson, sold the two tugboats which it had employed
in Hawaiian waters to provide harbor assistance to vessels calling at the
islands of Hawaii and Maui. Matson Services was dissolved effective December
31, 2001.

   Matson Logistics Solutions, Inc. ("Matson Logistics"), a wholly-owned
subsidiary of Matson, provides supply chain, transportation management, and
project cargo management services to Matson customers and others. In 2001,
Matson Logistics entered the air freight business by entering into an alliance
with an existing international air freight forwarder.

  (5) Competition

   Matson's Hawaii and Guam Services have one major containership competitor,
which serves Long Beach, Oakland, Tacoma, Honolulu and Guam.

   Other competitors in the Hawaii Service include two common carrier barge
services, unregulated proprietary and contract carriers of bulk cargoes, and
air cargo services. Although air freight competition is intense for
time-sensitive or perishable cargoes, historic and projected inroads of such
competition in cargo volume are limited by the amount of cargo space available
in passenger aircraft and by generally higher air freight rates.

   Matson vessels are operated on schedules which make available to shippers
and consignees regular day-of-the-week sailings from the United States Pacific
Coast and day-of-the-week arrivals in Hawaii. Under its current schedule,
Matson operates 182 Hawaii round-trip voyages per year, 75 percent more than
its closest competitor, and arranges additional voyages when cargo volumes
require additional capacity. This service is attractive to customers because
more frequent arrivals permit customers to lower inventory costs. In addition,
Matson competes by offering more comprehensive service to customers, supported
by its scope of equipment and its efficiency and experience in the handling of
containerized cargoes, and by competitive pricing.

   The carriage of cargo between the United States Pacific Coast and Hawaii on
foreign-built or foreign-documented vessels is prohibited by Section 27 of the
Merchant Marine Act, 1920, frequently referred to as the Jones Act. However,
foreign-flag vessels carrying cargo to Hawaii from foreign sources provide
indirect competition for Matson's container freight service between the United
States Pacific Coast and Hawaii. Far East countries, Australia, New Zealand and
South Pacific islands have direct foreign-flag services to Hawaii.

   In response to coordinated efforts by various interests to convince Congress
to repeal the Jones Act, Matson joined other businesses and organizations in
1995 to form the Maritime Cabotage Task Force, which supports the

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retention of the Jones Act and other cabotage laws. Repeal of the Jones Act
would allow all foreign-flag vessel operators, which do not have to abide by
U.S. laws and regulations, to sail between American ports, in direct
competition with Matson and other U.S. operators which must comply with such
laws and regulations. The Task Force seeks to inform elected officials and the
public about the economic, national security, commercial, safety and
environmental benefits of the Jones Act and similar cabotage laws.

   Matson Intermodal competes for freight with a number of large and small
companies engaged in intermodal transportation. Matson Logistics competes with
many larger providers of logistics services and with transportation companies
whose services include logistics.

  (6) Labor Relations

   The absence of strikes and the availability of labor through hiring halls
are important to the maintenance of profitable operations by Matson. Matson's
operations have not been disrupted significantly by strikes in the past 30
years. See "Employees and Labor Relations" below for a description of labor
agreements and certain unfunded liabilities for multi-employer pension plans to
which Matson and Matson Terminals contribute.

  (7) Rate Regulation

   Matson is subject to the jurisdiction of the Surface Transportation Board
with respect to its domestic rates. A rate in the noncontiguous domestic trade
is presumed reasonable and will not be subject to investigation if the
aggregate of increases and decreases is not more than 7.5 percent above, or
more than 10 percent below, the rate in effect one year before the effective
date of the proposed rate, subject to increase or decrease by the percentage
change in the U.S. Producer Price Index. Matson filed a 3.5 percent
across-the-board increase in its Hawaii Service shipping rates, which became
effective on February 14, 2001. Also in 2001, Matson reduced its fuel surcharge
in its Hawaii and Guam Services by one percentage point, from 4.25 percent to
3.25 percent, effective November 25, 2001.

  B.  Property Development and Management

  (1) General

   A&B and its subsidiaries own approximately 90,900 acres of land, consisting
of approximately 90,600 acres in Hawaii and approximately 300 acres elsewhere,
as follows:



                            Location   No. of Acres
                            --------   ------------
                                    
                            Oahu......        36
                            Maui......    68,709
                            Kauai.....    21,892
                            California       122
                            Texas.....        65
                            Washington        13
                            Arizona...        35
                            Nevada....        19
                            Colorado..        10
                                          ------
                               TOTAL..    90,901
                                          ======


As described more fully in the table below, the bulk of this acreage currently
is used for agricultural and related activities, and includes pasture land,
watershed land, and conservation reserves. The balance is used or planned for
development or other urban uses. An additional 3,270 acres on Maui and Kauai
are leased from third parties.

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                                                         No. of
                 Current Use                             Acres
                 -----------                             ------
                                                      
                  Hawaii
                  ------
                 Fully-entitled urban (defined below)...  1,246
                 Agricultural, pasture and miscellaneous 60,100
                 Watershed land/conservation............ 29,291
                  U.S. Mainland
                  -------------
                 Fully-entitled urban...................    254
                 Agriculture, pasture and miscellaneous.     10
                                                         ------
                    TOTAL............................... 90,901
                                                         ======


   A&B and its subsidiaries are actively involved in the entire spectrum of
land development, including planning, zoning, financing, constructing,
purchasing, managing and leasing, and selling and exchanging real property.

  (2) Planning and Zoning

   The entitlement process for development of property in Hawaii is both
time-consuming and costly, involving numerous State and County regulatory
approvals. For example, conversion of an agriculturally-zoned parcel to
residential zoning usually requires the following approvals:

    .  amendment of the County general plan to reflect the desired residential
       use;

    .  approval by the State Land Use Commission to reclassify the parcel from
       the "Agricultural" district to the "Urban" district;

    .  County approval to rezone the property to the precise residential use
       desired; and,

    .  if the parcel is located in the Special Management Area, the granting of
       a Special Management Area permit by the County.

   The entitlement process is complicated by the conditions, restrictions and
exactions that are placed on these approvals, including, among others, the
construction of infrastructure improvements, payment of impact fees,
restrictions on the permitted uses of the land, provision of affordable
housing, and/or mandatory fee sale of portions of the project.

   A&B actively works with regulatory agencies, commissions and legislative
bodies at various levels of government to obtain zoning reclassification of
land to its highest and best use. A&B designates a parcel as "fully-entitled"
or "fully-zoned" when all necessary government land use approvals have been
obtained.

   As described in more detail below, in 2001, work to obtain entitlements for
urban use focused on (i) obtaining Community Plan designations for various A&B
lands on Maui, and (ii) obtaining County entitlements for a proposed
single-family subdivision and proposed hotel on Maui. The Community Plans serve
to guide planning and development activity on Maui. A&B has obtained and
continues to seek various urban designations for its undeveloped lands within
the four Community Plans where most of its Maui lands are located.

  (3) Residential Projects

   A&B is pursuing a number of residential projects in Hawaii, including:

   (a) Kukui'Ula.   Kukui'Ula is a 1,045-acre master planned resort residential
community located in Poipu, Kauai. Approximately 837 acres are fully entitled
for up to 900 hotel and vacation ownership (timeshare) units, 3,000 residential
units, a golf course, and commercial uses. The balance of the project is
partially entitled and planned for

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up to 750 residential units. During 2001, the Company engaged in a number of
development activities intended to position the project for development and for
securing joint venture partners, including the following:

    .  Civil engineering design commenced on Koloa Plantations, Kukui'Ula's
       second residential project. Approximately 95 one-half acre lots are
       planned.

    .  The project's water master plan was updated, and two potential water
       sources were identified to supply potable water for the initial phase of
       development. Agreements defining the Company's participation in these
       water projects are undergoing final review by the Department of Water of
       the County of Kauai.

    .  Preliminary civil engineering design of backbone infrastructure
       commenced for the major project roadway.

    .  The initial phase of beach improvements was implemented, and
       archaeological mitigation and preservation plans were prepared for
       inventoried archaeological sites.

   In September 2001, a non-binding letter of intent was entered into with a
Mainland-based developer of master-planned communities, for the joint venture
development of Kukui'Ula. Based on due diligence activities completed to date,
a joint venture agreement could be finalized in the first quarter of 2002.

   Sales at Koloa Estates, Kukui'Ula's first for-sale residential project,
neared completion in 2001. Lot sales at this 32-lot subdivision commenced in
September 1999. As of January 31, 2002, 28 lots have been sold, with three lots
in escrow and one lot reserved. The average sales price of the 31 lots sold or
in escrow was $149,200.

   (b) The Vintage at Kaanapali.  Located on 17 acres in the Kaanapali Golf
Estates project in Kaanapali, Maui, and surrounded by the Kaanapali South Golf
Course, this project was developed as 73 detached single-family homes under a
condominium regime. Home construction began in February 2000 and was completed
in June 2001. All 73 homes were sold by July 2001. The units were sold at an
average price of $590,000.

   (c) The Summit at Kaanapali.  In January 2000, the Company acquired an
additional 17 acres in the Kaanapali Golf Estates project. This land is being
developed into 55 single-family homes or house lots. Site work construction was
completed in May 2001 and construction of the 17 homes in Phase I commenced in
June 2001. Five units were completed and closed as of December 31, 2001, at an
average price of $1.1 million. As of January 31, 2002, an additional eight
units were in escrow.

   (d) HoloHolo Ku.  In October 2001, the Company entered into a joint venture
with Kamuela Associates LLC for the development of 44 detached single-family
homes under a condominium regime, on an 8.5-acre parcel in Kamuela on the
island of Hawaii. An additional 7.2-acre estate lot is available for sale.
Construction commenced early November 2001 and sales are projected to begin
closing in the fourth quarter of 2002. As of January 31, 2002, there were 28
binding sales contracts in escrow.

   (e) Kai Lani.  In September 2001, the Company entered into a joint venture
agreement with Armstrong Kai Lani Corporation for the development of 116
townhouse units on an 11-acre parcel in the Ko Olina Resort on Oahu.
Construction commenced February 2002.

   (f) Waikiki Project.  On November 1, 2001, the Company acquired a 1.63-acre
vacant, fee simple development site in Waikiki, Oahu, for approximately $3.6
million. The property, located at the entrance to Waikiki, is zoned for
high-rise residential use and limited commercial uses. Planning and design work
for a high-rise condominium development is expected to take place in 2002.

   (g) Other Maui Subdivisions.  The Company continues to seek entitlements for
two other single-family subdivisions on Maui: (i) an approximately 200-unit
subdivision on 67 acres in Haliimaile (Upcountry, Maui), and (ii) an
approximately 400-unit subdivision on 210 acres in Spreckelsville, which
includes the possible expansion of the nearby nine-hole Maui Country Club golf
course into an 18-hole course. A final decision by the Maui County Council on
the Company's zoning application for the Haliimaile project was anticipated in
2001. However, due to general water and traffic issues for the Upcountry
region, final Council action is not anticipated until the second half of 2002.
Approval of the Spreckelsville project was sought from the Maui County Council
as part of its ten-year update of the Wailuku-Kahului Community Plan. Primarily
in response to concerns raised over potential traffic impacts, the

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Council Planning Committee, in September 2001, voted against including
Spreckelsville in the Community Plan. However, because of the project's
positive planning features, the Committee recommended that the Company file a
separate Community Plan application in order to have the project impacts
evaluated under an environmental impact assessment.

   In May 2001, a Disposition Agreement was entered into for the bulk sale of
the 86.4-acre Maunaolu agricultural subdivision (minimum two-acre sized lots).
Closing could be accomplished in the first half of 2002.

  (4) Commercial and Industrial Properties

   An important source of property revenue is the lease rental income the
Company receives from nearly 5.4 million leasable square feet of industrial and
commercial building space, ground leases on 275 acres for commercial/industrial
use, and leases on 10,930 acres for agricultural/pasture use.

   (a) Hawaii Commercial/Industrial Properties

   In Hawaii, most of the approximately 1.5 million square feet of
income-producing commercial and industrial properties owned by the Company are
located in the central Kahului/Wailuku area of Maui and in central Oahu. They
consist primarily of three shopping centers and ten office buildings, as well
as twelve other improved commercial and industrial properties. The average
occupancy for the Hawaii improved commercial properties increased to 90% in
2001, from 86% in 2000. The improvement was due primarily to the high tenancies
in recently-acquired properties.

   The Pacific Guardian Complex, consisting of an eighteen-story office
building and an adjacent two-story commercial complex, having a total leasable
area of 136,100 square feet, was acquired in February 2001. The property is
located in the Kapiolani business district on the island of Oahu. In June 2001,
the 124,600-square-foot Kaneohe Bay Shopping Center, located in the suburban
community of Kaneohe, Oahu, was added to the portfolio. Both properties were
98% occupied at the time of acquisition. These acquisitions were made through
tax-deferred exchanges under Section 1031 of the Internal Revenue Code, as
amended ("Code").

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   The primary Hawaii commercial/industrial properties are as follows:



                                                                Leasable Area
  Property                        Location           Type         (sq. ft.)
  --------                    ---------------- ---------------- -------------
                                                       
  Maui Mall..................  Kahului, Maui        Retail         192,600
  Pacific Guardian Complex...  Honolulu, Oahu       Office         136,100
  Kaneohe Bay Shopping Center  Kaneohe, Oahu        Retail         124,600
  P&L Warehouse..............  Kahului, Maui      Warehouse        104,100
  Kahului Shopping Center....  Kahului, Maui        Retail          99,400
  Ocean View Center..........  Honolulu, Oahu       Office          99,200
  Hawaii Business Park.......  Pearl City, Oahu   Warehouse         85,200
  Haseko Center..............  Honolulu, Oahu       Office          84,200
  One Main Plaza.............  Wailuku, Maui        Office          81,600
  Wakea Business Center......  Kahului, Maui   Warehouse/Retail     61,500
  Kahului Office Building....  Kahului, Maui        Office          55,400
  Fairway Shops at Kaanapali.  Kaanapali, Maui      Retail          35,000
  Kahului Office Center......  Kahului, Maui        Office          31,000
  Apex Building..............  Kahului, Maui        Retail          28,100
  Stangenwald Building.......  Honolulu, Oahu       Office          27,100
  Judd Building..............  Honolulu, Oahu       Office          20,200


   A number of other commercial and industrial projects are being developed on
Maui, Oahu and Kauai, including:

   (i) Triangle Square.  Construction of Kele Center, a 15,000-square-foot
commercial building at Triangle Square, near the Kahului Airport on Maui, was
completed in June 2001. A 4,500-square-foot national franchise restaurant
opened in October 2001, and a 1,200-square-foot national haircare salon is
scheduled to open in early 2002. Construction of a 6,200-square-foot automobile
dealership was completed in October 2001, and the dealership opened for
business that same month. Ground leases and build-to-suit opportunities are
being pursued for the remaining 4.5 acres at Triangle Square.

   (ii) Maui Business Park.  Located in Kahului, Maui, the initial phase of
Maui Business Park consists of Phase IA (37.4 saleable acres), completed in
1995, and Phase IB (32.0 saleable acres), completed in 2000.

   Phase IA includes the 349,305-square-foot Maui Marketplace retail center,
which is owned by a third party and occupies 20.3 acres of the subdivision.
Maui Marketplace includes national tenants such as Lowe's Home Improvement
Warehouse, Office Max, Sports Authority, Old Navy, Border's Books and Music,
and Pier 1. The remaining area of Phase IA consists of 30 lots with an average
size of 22,900 square feet, of which one lot was sold and one lot was leased in
2001. Thirteen lots (7.3 saleable acres) remain available for sale or lease.

   In Phase IB, Home Depot completed construction of a 135,000-square-foot
store in May 2001. In February 2001, Wal-Mart purchased a 14.0-acre parcel in
the subdivision and completed construction of a 142,000-square-foot store in
October 2001. The remaining area consists of 10 lots with an average size of
18,800 square feet, of which one lot was sold and one lot was leased in 2001.
Eight lots (3.7 saleable acres) remain available for sale or lease.

   As part of the County of Maui's ten-year update of the Wailuku-Kahului
Community Plan, referred to above,
the Company is seeking the approval of approximately 175 acres for future
expansion of Maui Business Park. Based on concerns raised by Maui County
Council members over, among other things, whether the expansion areas were too
close to Kahului Airport, the Council Planning Committee voted against
recommending approval of the expansion areas. Following the Company's efforts
to address these concerns, on January 11, 2002, the County Council voted to
send the expansion proposal back to the Planning Committee for reconsideration.

   (iii) Kahului Airport Hotel.  In January 2001, land use applications were
filed with the County of Maui for the development of a 140-room,
moderately-priced hotel on 3.4 acres, at the entrance to Kahului Airport. The
hotel, to be operated under the Courtyard by Marriott brand, requires Community
Plan, zoning and special management area approvals before development can
proceed. A required environmental assessment for the project was completed in
July 2001. In September 2001, the Maui Planning Commission recommended approval
of the land use applications to

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the Maui County Council, and in January 2002, the Council's Land Use Committee
recommended approval of the land use applications to the Council. Final Council
action is anticipated in the second quarter of 2002.

   (iv) Fairway Shops at Kaanapali.  Construction of this 35,500-square-foot
resort retail center in Kaanapali, Maui commenced in July 2001 and was
completed in December 2001. The center is located on a 3.2-acre site along
Honoapiilani Highway, the main corridor between Lahaina and Kapalua. Leasing
activities have commenced, but have been adversely affected by the September 11
impacts on tourism.

   (v) Port Allen Marina Center.  Pursuant to a long-term master plan for the
development of 80 acres at Port Allen, Kauai, construction began in October
2001 on a 26,000-square-foot retail center located on 1.7 acres. Construction
is expected to be complete by the third quarter of 2002.

   (vi) Mill Town Center.  Located in Waipahu, Oahu (approximately 12 miles
from Honolulu), the Mill Town Center is a light-industrial subdivision
consisting of 27.5 saleable acres being developed in two phases. Phase IA
(10.2 saleable acres), completed in 1999, consists of 23 fee simple industrial
lots. Four lots were sold to commercial and industrial businesses in 2001 and
eight lots (3.2 saleable acres) remain available for sale or lease.

   Construction of infrastructure improvements for Phase IB (17.3 saleable
acres) was delayed in 2001 due to the discovery of lead contamination in
approximately four acres of the subdivision. Infrastructure construction
commenced in August 2001 on the unaffected portion of the site. Remediation
activities on the affected portion commenced in December 2001 and are expected
to be completed in early 2002. Construction of the remaining infrastructure for
Phase IB is expected to be completed by mid-2002. Marketing activities
commenced in 2001. In November 2001, an affiliate of Japan-based Fuji Photo
Film Co., Ltd. purchased a 3.0-acre parcel in Phase IB and commenced
construction of a 54,000-square-foot office, film processing and warehouse
facility. The remaining portion of Phase IB consists of 31 lots (14.3 saleable
acres), with an average size of 20,100 square feet.

   (b) U.S. Mainland Commercial/Industrial Properties

   On the U.S. Mainland, the Company owns a portfolio of commercial and
industrial properties, acquired primarily by way of tax-deferred exchanges
under Code Section 1031, comprising a total of approximately 4.0 million square
feet of leasable area, as follows:



                                                                              Leasable Area
Property                              Location                 Type             (sq. ft.)
- --------                        -------------------- ------------------------ -------------
                                                                     
Ontario Distribution Center.... Ontario, CA                 Warehouse             895,500
Great Southwest Industrial..... Dallas, TX                  Warehouse             842,900
Ontario-Pacific Business Centre Ontario, CA                 Warehouse             246,100
Valley Freeway Corporate Park.. Kent, WA                    Warehouse             229,100
Airport Square................. Reno, NV                      Retail              170,800
San Pedro Plaza................ San Antonio, TX               Office              163,800
2868 Prospect Park............. Sacramento, CA                Office              160,700
Day Creek Industrial........... Ontario, CA                 Warehouse             147,300
Arbor Park..................... San Antonio, TX               Retail              139,500
Mesa South Center.............. Phoenix, AZ                   Retail              133,600
Moulton Plaza.................. Laguna Hills, CA              Retail              133,600
San Jose Avenue Warehouse...... City of Industry, CA        Warehouse             126,000
Southbank II................... Phoenix, AZ                   Office              120,800
Village at Indian Wells........ Indian Wells, CA              Retail              104,600
2450 Venture Oaks.............. Sacramento, CA                Office               99,000
Northwest Business Center...... San Antonio, TX      Service Center/Warehouse      87,100
Carefree Court................. Carefree, AZ                  Retail               85,000
Wilshire Center................ Greeley, CO                   Retail               46,700
Market Square.................. Greeley, CO                   Retail               43,300


                                      10

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   In January 2001, the Company sold its Bainbridge Property portfolio located
on Bainbridge Island, WA. This portfolio included two retail properties and an
office building, having a combined leasable area of 114,600 square feet. In
June 2001, the Company acquired the Carefree Court shopping center, located in
the resort community of Carefree, AZ, situated north of Scottsdale, AZ. This
property was acquired as part of a Code Section 1031 exchange. In February
2002, the Company sold the Great Southwest Industrial property, located in
Dallas, TX.

   A&B's Mainland commercial properties achieved an average occupancy rate of
93%, as compared to the 2000 average of 96%. The decrease primarily resulted
from an increase in available space in the Great Southwest Industrial property.

  C.  Food Products

  (1) Production

   A&B has been engaged in activities relating to the production of cane sugar
and molasses in Hawaii since 1870, and production of coffee in Hawaii since
1987. A&B's current food products operations consist of a sugar plantation on
the island of Maui, operated by its Hawaiian Commercial & Sugar Company
("HC&S") division, and a coffee farm on the island of Kauai, operated by its
Kauai Coffee Company, Inc. ("Kauai Coffee") subsidiary.

   HC&S is Hawaii's largest producer of raw sugar, having produced 191,512 tons
of raw sugar in 2001, or about 70% of the raw sugar produced in Hawaii,
compared with 210,269 tons of raw sugar in 2000. The decrease in production was
due primarily to an extended drought. Total Hawaii sugar production, in turn,
amounted to approximately four percent of total United States sugar production.
HC&S harvested 15,101 acres of sugar cane in 2001, compared with 17,266 acres
in 2000. The decrease in acres harvested was due primarily to a
later-than-expected factory startup in 2001 and unexpected factory problems and
weather delays toward the end of the 2001 harvesting season. Yields averaged
12.7 tons of sugar per acre in 2001, compared with 12.2 tons per acre in 2000.
The average cost per ton of sugar produced at HC&S was $371 in 2001, compared
with $331 in 2000. The increase in cost per ton was attributable to higher
operating costs and lower sugar production. As a by-product of sugar
production, HC&S also produced 71,207 tons of molasses in 2001, compared with
70,551 tons in 2000.

   In 2001, 8,848 tons of the raw sugar produced by HC&S were produced as
specialty food-grade raw sugars and sold under HC&S's Maui Brand(R) trademark.
A $2.4 million expansion of the production facilities for these sugars was
completed in February 2001. Further expansion is planned for 2002.

   During 2001, Kauai Coffee had approximately 3,400 acres of coffee trees
under cultivation. The harvest of the 2001 coffee crop yielded approximately
3.8 million pounds of green coffee, compared with 2.8 million pounds in 2000.
The increased production was due primarily to better weather conditions in 2001.

   Due to weaknesses in the panelboard market, production problems and poor
operating results, a development panelboard plant ceased operations and was
abandoned. The plant, operated by Hawaiian DuraGreen, Inc., a wholly-owned
subsidiary of A&B, produced panelboard from bagasse, a by-product in the
production of sugar. A&B recorded operating losses and closure costs of
$2,964,000, and a $11,387,000 write-down of the production assets, as a result
of this action.

   HC&S and McBryde Sugar Company, Limited ("McBryde"), the parent company of
Kauai Coffee, produce electricity for internal use and for sale to the local
electric utility companies. HC&S's power is produced by burning bagasse, by
hydroelectric power generation and, when necessary, by burning fossil fuels,
whereas McBryde produces power solely by hydroelectric generation. The price
for the power sold by HC&S and McBryde is equal to the utility companies'
"avoided cost" of not producing such power themselves. In addition, HC&S
receives a capacity payment to provide a guaranteed power generation capacity
to the local utility. (See "Energy" below.)

   Kahului Trucking & Storage, Inc., a subsidiary of A&B, provides sugar and
molasses hauling and storage, petroleum hauling, mobile equipment maintenance
and repair services, and self-service storage facilities on Maui.

                                      11

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Kauai Commercial Company, Incorporated, another subsidiary of A&B, provides
similar services on Kauai, as well as general trucking services.

  (2) Marketing of Sugar and Coffee

   Substantially all of the raw sugar produced in Hawaii is purchased, refined
and marketed by C&H Sugar Company, Inc. ("C&H"), of which A&B owns a 36 percent
common stock interest. The results of A&B's equity investment in C&H are
reported in A&B's financial statements as an investment in an affiliate. C&H
processes the raw cane sugar at its refinery at Crockett, California, and
markets the refined products primarily in the western and central United
States. HC&S markets its specialty food-grade raw sugars to food and beverage
producers and to retail stores under its Maui Brand(R) label, and to
distributors which repackage the sugars under their own labels. HC&S's largest
food-grade raw sugar customers are Cumberland Packing Corp. and Sugar Foods
Corporation, which repackage HC&S's turbinado sugar for their "Sugar in the
Raw" products.

   Hawaiian Sugar & Transportation Cooperative ("HS&TC"), a cooperative
consisting of the two remaining sugar cane growers in Hawaii (including HC&S),
has a ten-year supply contract with C&H, ending in June 2003, pursuant to which
the growers sell their raw sugar to C&H at a price equal to the New York #14
Contract settlement price, less a discount and less costs of sugar vessel
discharge and stevedoring. This price, after deducting the marketing,
operating, distribution, transportation and interest costs of HS&TC, reflects
the gross revenue to the Hawaii sugar growers, including HC&S. Notwithstanding
the ten-year supply contract, HC&S arranged directly with C&H for the forward
pricing of a substantial portion of its 2001 harvest, as described in Item 7A
("Quantitative and Qualitative Disclosures About Market Risk") below. In
addition, as of January 15, 2002, 30% of the expected 2002 harvest has been
forward priced.

   At Kauai Coffee, coffee marketing efforts are directed toward developing a
market for premium-priced, estate-grown Kauai green coffee. Most of the coffee
crop is being marketed on the U.S. Mainland and in Asia as green (unroasted)
coffee. In addition to the sale of green coffee, Kauai Coffee produces and
sells roasted, packaged coffee in Hawaii under the "Kauai Coffee" trademark.

  (3) Competition and Sugar Legislation

   Hawaii sugar growers produce more sugar per acre than other major producing
areas of the world, but that advantage is partially offset by Hawaii's high
labor costs and the distance to the U.S. Mainland market. Hawaiian refined
sugar is marketed primarily west of Chicago. This is also the largest beet
sugar growing and processing area and, as a result, the only market area in the
United States which produces more sugar than it consumes. Sugar from sugar
beets is the greatest source of competition in the refined sugar market for the
Hawaiian sugar industry.

   The overall U.S. caloric sweetener market continues to grow. The use of
non-caloric (artificial) sweeteners accounts for a relatively small percentage
of the domestic sweetener market. The anticipated increased use of high
fructose corn syrup and artificial sweeteners is not expected to affect sugar
markets significantly in the near future.

   The U.S. Congress historically has sought, through legislation, to assure a
reliable domestic supply of sugar at stable and reasonable prices. The current
protective legislation for domestic sugar, the Federal Agriculture Improvement
and Reform Act (the "1996 Farm Bill"), provides a sugar loan program for the
1996 through 2002 crops, with a loan rate (support price) of 18 cents per pound
for raw sugar. The loan rate represents the value of sugar given as collateral
for government price-support loans. The government is required to administer
the sugar program at no net cost, and this is accomplished by adjusting fees
and quotas for imported sugar to maintain the domestic price at a level that
discourages producers from defaulting on loans. The ten-year supply contract
between HS&TC and C&H limits HC&S's ability to place sugar under loan pursuant
to the sugar loan program. The 1996 Farm Bill also eliminated marketing
allotments, thereby removing the means of limiting domestic production. The
1.25-million-ton minimum import quota set under the General Agreement on Tariff
and Trade ("GATT") is retained in the 1996 Act.


                                      12

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   During 2001, legislation was developed for a new omnibus farm bill ("2002
Farm Bill"). A House farm bill, entitled the Farm Security Act of 2001, was
approved by the U.S. House of Representatives on October 5, 2001. Among other
things, that bill seeks to continue for ten years the current marketing loan
program at current loan rates for sugar, and seeks to reestablish marketing
allotments which are expected to stabilize prices. A Senate farm bill, with
identical provisions for sugar, was approved by the U.S. Senate on February 13,
2002. The 2002 Farm Bill is expected to be approved in 2002.

   In 2001, U.S. domestic raw sugar prices averaged 21.09 cents per pound,
above the 20-year lows experienced in 2000, but still below historical
averages. The pricing situation has improved, but continues to be challenging,
even to efficient producers like HC&S. A chronological chart of the average
U.S. domestic raw sugar prices, based on the average daily New York Contract
#14 settlement price for domestic raw sugar, is shown below:

                                    [CHART]




     
Jan-98  22.11
FEB     21.79
MAR     21.74
APR     22.2
MAY     22.28
JUN     22.298
JUL     22.32
AUG     22.3
SEP     22.25
OCT     22.15
NOV     22.03
DEC     21.97
Jan-99  22.41
FEB     22.34
MAR     22.55
APR     22.58
MAY     22.65
JUN     22.63
JUL     22.61
AUG     21.31
SEP     20.10
OCT     20.51
NOV     17.45
DEC     17.67
Jan-00  17.70
FEB     17.05
MAR     18.46
APR     19.41
MAY     19.12
JUN     19.26
JUL     17.64
AUG     18.13
SEP     18.97
OCT     21.20
NOV     21.39
DEC     20.53
Jan-01  20.81
FEB     21.18
MAR     21.40
APR     21.51
MAY     21.19
JUN     21.04
JUL     20.64
AUG     21.01
SEP     20.87
OCT     20.85
NOV     21.19
DEC     21.35




   Liberalized international trade agreements, such as the GATT, include
provisions relating to agriculture which can affect the U.S. sugar or sweetener
industries materially. A "side" agreement that modified the North American Free
Trade Agreement ("NAFTA") alleviated some of the sugar producers' concerns by
limiting Mexico's exports of sugar to the U.S. under NAFTA. However, the export
ceiling provided for in the side agreement increased to 250,000 tons of sugar
in 2000, and will be eliminated in 2007. The increased sugar supply could
affect domestic sugar prices adversely.

   Kauai Coffee competes with coffee growers located worldwide, including
Hawaii. Due to an oversupply of coffee in the marketplace, coffee commodity
prices dropped significantly in 2000 and continued to drop to record lows in
2001.

  (4) Properties and Water

   The HC&S sugar plantation, the largest in Hawaii, consists of approximately
43,300 acres of land, including 2,000 acres leased from the State of Hawaii and
1,300 acres under lease from private parties. Over 37,000 acres are under
cultivation, and the balance either is used for contributory purposes, such as
roads and plant sites, or is not suitable for cultivation.

   McBryde owns approximately 9,500 acres of land on Kauai, of which
approximately 2,400 acres are used for watershed and other conservation uses,
approximately 3,400 acres are used by Kauai Coffee, and the remaining acreage
is leased to various agricultural enterprises for cultivation of a variety of
crops and for pasturage.

   Large quantities of water are needed by HC&S and Kauai Coffee for their
sugar cane and coffee growing operations. Because of the importance of water,
access to water, reliable sources of supply and efficient irrigation systems
are crucial for the successful growing of sugar cane and coffee. A&B's
plantations use a "drip" irrigation system that distributes water to the roots
through small holes in plastic tubes. All of the cultivated cane land farmed by
HC&S is drip irrigated. All of Kauai Coffee's fields also are drip irrigated.

                                      13

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   A&B owns 16,000 acres of watershed lands on Maui, which supply a portion of
the irrigation water used by HC&S. A&B also held four water licenses to 38,000
acres owned by the State of Hawaii, which over the years supplied approximately
one-third of the irrigation water used by HC&S. The last of these water license
agreements expired in 1986, and all four agreements have since been extended as
revocable permits that are renewable annually. In 2001, a request was made to
the State Board of Land and Natural Resources to replace these revocable
permits with a long-term water lease. Pending a contested case hearing before
the Board on the request for the long-term lease, the Board approved a
month-to-month holdover of the existing permits.

  D.  Employees and Labor Relations

   As of December 31, 2001, A&B and its subsidiaries had approximately 2,054
regular full-time employees. About 916 regular full-time employees were engaged
in the growing of sugar cane and coffee and the production of raw sugar and
green coffee, 927 were engaged in ocean transportation, 44 were engaged in
property development and management, and the balance was in administration and
miscellaneous operations. Approximately 55% were covered by collective
bargaining agreements with unions.

   As of December 31, 2001, Matson and its subsidiaries also had approximately
317 seagoing employees. Approximately 26% of Matson's regular full-time
employees and all of the seagoing employees were covered by collective
bargaining agreements.

   Historically, collective bargaining with longshore and seagoing unions has
been complex and difficult. However, Matson and Matson Terminals consider their
relations with those unions, other unions, and their non-union employees
generally to be satisfactory.

   Matson's seagoing employees are represented by six unions, three
representing unlicensed crew members and three representing licensed crew
members. Matson negotiates directly with these unions. Collective bargaining
agreements with the unions representing unlicensed crew members are expected to
be renewed in mid-2002 without service interruption.

   SSA Terminals LLC ("SSAT"), the previously-described joint venture of Matson
and Stevedoring Services of America ("SSA"), provides stevedoring and terminal
services for Matson vessels calling at U.S. Pacific Coast ports. Matson, SSA,
and SSAT are members of the Pacific Maritime Association ("PMA") which, on
behalf of its members, negotiates collective bargaining agreements with the
International Longshore Workers Union ("ILWU") on the Pacific Coast. Matson
Terminals provides stevedoring and terminal services to Matson vessels calling
at Honolulu. Matson Terminals is a member of the Hawaii Stevedore Industry
Committee which, on behalf of its members, negotiates with the ILWU in Hawaii.
Collective bargaining agreements with ILWU longshore workers on the Pacific
Coast and in Hawaii are expected to be renewed in mid-2002 without service
interruption.

   During 2001, Matson renewed its collective bargaining agreement with ILWU
clerical workers at Los Angeles for a three-year term and expects to renew its
agreement with ILWU clerical workers at Oakland in mid-2002 without service
interruption.

   Matson contributed during 2001 to multi-employer pension plans for vessel
crews. If Matson were to withdraw from or significantly reduce its obligation
to contribute to one of the plans, Matson would review and evaluate data,
actuarial assumptions, calculations and other factors used in determining its
withdrawal liability, if any, and, in the event of material disagreement with
such determination, would pursue the various means available to it under
federal law for the adjustment or removal of its withdrawal liability. Matson
Terminals participates in a multi-employer pension plan for its Hawaii
longshore employees. For a discussion of withdrawal liabilities under the
Hawaii longshore and seagoing plans, see Note 10 to A&B's financial statements
in Item 8 below.

   Bargaining unit employees of HC&S are covered by two collective bargaining
agreements with the ILWU. The agreements with the HC&S production unit
employees and clerical bargaining unit employees were extended in 2001 and will
expire January 31, 2003. A collective bargaining agreement with the ILWU for
production employees of

                                      14

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Hawaiian DuraGreen, Inc. was negotiated, but all production employees
subsequently were terminated in connection with the shutdown of the panelboard
plant. The collective bargaining agreements covering the two ILWU bargaining
units at Kahului Trucking & Storage, Inc. will expire on March 31, 2006 and on
June 30, 2002 (the latter is expected to be renewed without service
interruption). The two collective bargaining agreements with Kauai Commercial
Company, Incorporated employees represented by the ILWU were renegotiated in
2001 and will expire April 30, 2004. The collective bargaining agreement with
the ILWU for the production unit employees of Kauai Coffee was renegotiated in
2001 and will expire on January 31, 2004.

  E.  Energy

   Matson and Matson Terminals purchase residual fuel oil, lubricants, gasoline
and diesel fuel for their operations. Residual fuel oil is by far Matson's
largest energy-related expense. In 2001, Matson vessels consumed approximately
1.8 million barrels of residual fuel oil, the same as in 2000.

   Residual fuel oil prices paid by Matson started in 2001 at $127.50 per
metric ton and ended the year at $103.00 per metric ton. A high of $180.50 per
metric ton occurred in June, and a low of $92.00 per metric ton occurred in
November. Sufficient fuel for Matson's requirements is expected to be available
in 2002.

   As has been the practice with sugar plantations throughout Hawaii, HC&S uses
bagasse, the residual fiber of the sugar cane plant, as a fuel to generate
steam for the production of most of the electrical power for sugar milling and
irrigation pumping operations. In addition to bagasse, HC&S uses diesel fuel
oil, boiler fuel oil, and coal to produce power, principally for pumping
irrigation water during the factory shutdown period when bagasse is not being
produced. Since 1992, when suppliers of boiler fuel oil to HC&S discontinued
regular shipments as a result of unlimited liability concerns arising from
federal and state environmental laws, boiler fuel oil has been provided to HC&S
on a space available basis. In 2001, HC&S produced 203,650 MWH of electric
power and sold 61,074 MWH, compared with 217,279 MWH produced and 67,105 MWH
sold in 2000. The reduction in power produced and sold was caused by HC&S's
increased need to pump irrigation water, due to drought conditions. HC&S's oil
use decreased to 68,999 barrels in 2001, from the 100,313 barrels used in 2000.
Coal use for power generation increased, from 61,222 short tons in 2000 to
62,389 short tons in 2001. The decrease in fuel oil used is attributed to
HC&S's shutdown of one of its two sugar mills in 2000.

   In 2001, McBryde produced 30,637 MWH of hydroelectric power, compared with
31,971 MWH of hydroelectric power produced in 2000. Power sales in 2001
amounted to 21,216 MWH, compared with 23,375 MWH sold in 2000. The reduction in
power production and sales was due primarily to continued drought conditions in
2001.

ITEM 3.  LEGAL PROCEEDINGS

   See "Business and Properties--Ocean Transportation--Rate Regulation" above
for a discussion of rate and other regulatory matters in which Matson is
routinely involved.

   On September 14, 1998, Matson was served with a complaint filed by the
Government of Guam with the Surface Transportation Board ("STB"), alleging that
Sea-Land Services, Inc. ("Sea-Land"), American President Lines, Ltd. ("APL")
and Matson have charged unreasonable rates in the Guam trade since January
1991. Matson did not enter the trade until February 1996. On November 12, 1998,
Matson filed an answer, denying that its rates have been unreasonable. Matson,
Sea-Land and APL filed a joint motion to dismiss the complaint on February 16,
1999. On November 15, 2001, the STB issued a decision, granting the motion in
part and denying it in part. The STB dismissed the claim of discrimination,
dismissed the aggregate rate challenge for shipments prior to September 10,
1996, dismissed APL as a defendant based on the statute of limitations, and
permitted the Caribbean Shippers Association to intervene. The parties have
until April 9, 2002 to file initial briefs addressing the appropriate rate
reasonableness methodology to be applied to the remaining issue of whether the
aggregate rates charged by Matson and Sea-Land in the Guam trade after
September 10, 1996 are reasonable. Reply briefs will be due on June 3, 2002.

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   A&B and its subsidiaries are parties to, or may be contingently liable in
connection with, other legal actions arising in the normal conduct of their
businesses, the outcomes of which, in the opinion of management after
consultation with counsel, would not have a material adverse effect on A&B's
results of operations or financial position.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

   Not applicable.

EXECUTIVE OFFICERS OF THE REGISTRANT

   For the information about executive officers of A&B required to be included
in this Part I, see paragraph B of "Directors and Executive Officers of the
Registrant" in Part III below, which is incorporated into Part I by reference.

                                    PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

   A&B common stock is listed on The Nasdaq Stock Market and trades under the
symbol "ALEX". As of February 14, 2002, there were 4,233 shareholders of record
of A&B common stock. In addition, Cede & Co., which appears as a single record
holder, represents the holdings of thousands of beneficial owners of A&B common
stock.

   A summary of daily stock transactions is listed in the Nasdaq National
Market Issues section of major newspapers. Trading volume averaged 135,600
shares a day in 2001, compared with 98,900 in 2000 and 105,800 in 1999.
Currently, 19 firms make a market in ALEX.

   The quarterly high and low sales prices and closing prices, as reported by
The Nasdaq Stock Market, and cash dividends paid per share of common stock, for
2000 and 2001, were as follows:



                                                     Market Price
                                      Dividends -----------------------
                                        Paid     High     Low    Close
        2001                          --------- ------- ------- -------
        ----
                                                    
        First Quarter................  $0.225   $29.609 $21.063 $21.375
        Second Quarter...............   0.225    25.840  20.610  25.750
        Third Quarter................   0.225    26.430  21.120  23.410
        Fourth Quarter...............   0.225    27.920  21.600  26.700

        2000
        ----
        First Quarter................  $0.225   $22.783 $17.938 $20.625
        Second Quarter...............   0.225    24.625  19.250  22.063
        Third Quarter................   0.225    27.500  21.875  26.000
        Fourth Quarter...............   0.225    28.250  21.625  26.250


   Although A&B expects to continue paying quarterly cash dividends on its
common stock, the declaration and payment of dividends in the future are
subject to the discretion of the Board of Directors and will depend upon A&B's
financial condition, results of operations, cash requirements and other factors
deemed relevant by the Board of Directors. A&B strives to pay the highest
possible dividends commensurate with operating and capital needs. A&B has paid
cash dividends in every quarter since 1903. The most recent increase in the
quarterly dividend rate was effective in the first quarter of 1998, from 22
cents a share to 22.5 cents. In 2001, dividend payments to shareholders

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totaled $36.5 million, which was 33% of reported net income for the year. The
following dividend schedule for 2002 has been set, subject to final approval by
the Board of Directors:



          Quarterly Dividend Declaration Date Record Date Payment Date
          ------------------ ---------------- ----------- ------------
                                                 
          First.......          January 24    February 14     March 7
          Second......            April 25          May 6      June 6
          Third.......             June 27       August 1 September 5
          Fourth......          October 24     November 7  December 5


   A&B common stock is included in the Dow Jones Transportation Index, the Dow
Jones Composite Index, the Dow Jones Marine Transportation Index, the Dow Jones
Sustainability Group Index and the S&P MidCap 400 Index.

   The number of shares of A&B common stock repurchased by A&B during each of
the three years ended December 31, 2001 was as follows:



                                            Shares    Average Price
            Year                          Repurchased  (per share)
            ----                          ----------- -------------
                                                
            2001.........................    105,000     $21.61
            2000.........................  2,378,195     $20.29
            1999.........................  1,564,500     $22.26


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ITEM 6.  SELECTED FINANCIAL DATA

The following financial data should be read in conjunction with Item 8,
"Financial Statements and Supplementary Data," and Item 7, "Management's
Discussion and Analysis of Financial Condition and Results of Operations" :



                                                 2001        2000        1999        1998        1997
                                              ----------  ----------  ----------  ----------  ----------
                                              (dollars and shares in thousands, except per-share amounts)
                                                                               
ANNUAL OPERATIONS
Total revenue/1/............................. $1,190,073  $1,068,646  $  999,998  $1,343,475  $1,310,176
Deduct:
Cost of goods sold and operating expenses/1/.    908,777     849,375     812,783   1,174,881   1,065,470
 Depreciation and amortization...............     75,433      72,304      73,901      88,500      88,558
 Interest expense............................     18,658      24,252      17,774      24,799      28,936
 Income taxes................................     67,392      44,391      32,961      24,352      45,825
                                              ----------  ----------  ----------  ----------  ----------
Income from continuing operations before
  accounting changes.........................    119,813      78,324      62,579      30,943      81,387
Discontinued operations......................     (9,185)         --          --          --          --
Cumulative effect of change in accounting
  methods....................................         --      12,250          --      (5,801)         --
                                              ----------  ----------  ----------  ----------  ----------
Net income................................... $  110,628  $   90,574  $   62,579  $   25,142  $   81,387
                                              ==========  ==========  ==========  ==========  ==========
Comprehensive income......................... $   48,691  $  103,050  $   48,711  $   33,327  $   88,326
Earnings per share before accounting changes:
 Basic....................................... $     2.96  $     1.92  $     1.45  $     0.69  $     1.80
 Diluted..................................... $     2.94  $     1.91  $     1.45  $     0.69  $     1.80
Return on beginning equity...................       15.9%       13.5%        9.0%        3.5%       11.9%
Cash dividends per share..................... $     0.90  $     0.90  $     0.90  $     0.90  $     0.88
Average number of shares outstanding.........     40,535      40,898      43,206      44,760      45,182
Gross profit percentage/1/...................       23.6%       23.0%       22.1%       17.0%       20.1%
Effective income tax rate....................       36.0%       36.5%       34.5%       45.4%       36.0%

MARKET PRICE RANGE PER SHARE
 High........................................ $   29.609  $   28.250  $   27.125  $   31.125  $   29.375
 Low.........................................     20.610      17.938      18.625      18.813      24.375
 Close.......................................     26.700      26.250      22.813      23.250      27.313

AT YEAR END
 Shareholders of record......................      4,252       4,438       4,761       5,125       5,481
 Shares outstanding..........................     40,529      40,353      42,526      44,028      44,881
 Shareholders' equity........................ $  710,667  $  693,651  $  670,963  $  694,642  $  719,588
   Per-share.................................      17.54       17.19       15.78       15.78       16.03
 Total assets................................  1,544,419   1,666,012   1,561,460   1,605,640   1,704,798
 Working capital.............................     24,445      55,861      59,805      67,113     114,806
 Cash and cash equivalents...................     19,291       3,451       3,333      86,818      21,623
 Real estate developments - noncurrent.......     47,840      62,628      60,810      57,690      68,056
 Investments - noncurrent....................     33,021     183,141     158,726     159,068     102,813
 Capital Construction Fund...................    158,737     150,405     145,391     143,303     148,610
 Long-term debt - noncurrent.................    207,378     330,766     277,570     255,766     292,885
 Current ratio...............................   1.1 to 1    1.4 to 1    1.4 to 1    1.4 to 1    1.7 to 1
 Capital stock price/earnings ratio..........   9.8 to 1   11.9 to 1   15.7 to 1   41.5 to 1   15.2 to 1

- --------
/1/ See Note 2 to the consolidated financial statements in Item 8 for
    information regarding changes which were made in 2000 in presentation for
    certain revenues and expenses.

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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

   The following analysis of the consolidated financial condition and results
of operations of Alexander & Baldwin, Inc. and its subsidiaries (collectively,
the "Company") should be read in conjunction with the consolidated financial
statements and related notes thereto.

FORWARD-LOOKING STATEMENTS

   The Company, from time to time, may make or may have made certain
forward-looking statements, whether orally or in writing, such as forecasts and
projections of the Company's future performance or statements of management's
plans and objectives. These statements are "forward-looking" statements as that
term is defined in the Private Securities Litigation Reform Act of 1995. Such
forward-looking statements may be contained in, among other things, Securities
and Exchange Commission (SEC) filings, such as the Forms 10-K, press releases
made by the Company, the Company's Internet Web sites (including Web sites of
its subsidiaries), and oral statements made by the officers of the Company.
Except for historical information contained in these written or oral
communications, such communications contain forward-looking statements. These
forward-looking statements involve a number of risks and uncertainties that
could cause actual results to differ materially from those projected in the
statements, including, but not limited to: (1) impact of events of September
11, 2001; (2) economic conditions in Hawaii and elsewhere; (3) market demand;
(4) competitive factors and pricing pressures in the Company's primary markets;
(5) legislative and regulatory environments at the federal, state and local
levels, such as government rate regulations, land-use regulations, government
administration of the U.S. sugar program, and modifications to or retention of
cabotage laws; (6) dependence on third-party suppliers; (7) fuel prices; (8)
raw sugar prices; (9) labor relations; (10) risks associated with current or
future litigation and resolution of tax issues with the IRS and state tax
authorities; (11) the performance of unconsolidated affiliates and ventures;
and (12) other risk factors described elsewhere in these communications and
from time to time in the Company's filings with the SEC.

CONSOLIDATED RESULTS OF OPERATIONS

   Consolidated Earnings and Revenue:  Net income in 2001 was $110,628,000, or
$2.73 per basic share, versus $90,574,000, or $2.21 per basic share, in 2000
and $62,579,000, or $1.45 per basic share, in 1999. Revenue in 2001 was
$1,190,073,000, compared with revenue of $1,068,646,000 in 2000 and
$999,998,000 in 1999.

Accounting Changes and Significant Transactions

   2001:   Results for 2001 include the sales of the Company's marketable
equity securities. The sales of these securities resulted in cash receipts of
approximately $134,722,000, pre-tax gains of approximately $125,478,000 and
after-tax gains of about $77,788,000 ($1.92 per basic share). The Company also
donated appreciated stock with an approximate fair value of $7,500,000 to its
charitable foundation. These sales are described more fully in Note 5 to the
consolidated financial statements included in Item 8.

   The Company reduced the carrying value of its equity investments in C&H
Sugar Company, Inc. ("C&H") by $28,600,000. This resulted in an after-tax
charge of $17,732,000 ($0.44 per basic share). In addition, the Company wrote
off $4,823,000 of power generation equipment, resulting in a $3,087,000
after-tax charge to earnings ($0.08 per basic share). These impairments are
discussed more fully in Note 4 to the consolidated financial statements
included in Item 8.

   The Company discontinued and abandoned its panelboard manufacturing
subsidiary on Maui. This discontinued operation resulted in a $9,185,000
after-tax charge to earnings ($0.23 per basic share). This is described in Note
3 to the consolidated Financial statements included in Item 8.

   2000:   The Company made two changes in accounting methods (See Note 2 to
the consolidated financial statements). The first change was for vessel
drydocking costs at Matson. Previously, the estimated costs for future
drydocking of vessels were accrued in advance of the drydocking. Subsequent
payments were charged against the accrued liability. Under the new method,
drydocking expenditures that benefit future periods are capitalized and

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depreciated. This change increased 2000 net income by $12,250,000 (net of
income tax expense of $7,668,000), or $0.29 per basic share. The second change
was for the presentation of certain costs recorded in the ocean transportation
and property leasing segments, which previously were recorded as an offset to
revenue. This change did not affect net income.

   1999:   Following continuing operating losses, depressed coffee prices and
negative cash flows at Kauai Coffee Company, Inc. ("Kauai Coffee"), the
Company's coffee plantation, the Company recorded an after-tax charge of
$9,571,000, or $0.22 per basic share, to write down the recorded value of
orchards and other non-current assets to their estimated fair values.

RESULTS OF INDUSTRY SEGMENT OPERATIONS

   Detailed information related to the operations and financial performance of
the Company's Industry Segments is included in Note 14 of Item 8 "Financial
Statements and Supplementary Data." The following information should be read in
relation to information contained in that Note.

2001 Compared with 2000

   Ocean Transportation revenue of $796,840,000 was $53,852,000, or six
percent, lower than the $850,692,000 reported for 2000. Operating profit of
$62,264,000 was $31,468,000, or 34 percent, lower than the $93,732,000 reported
during the prior year. The revenue and operating profit declines were directly
attributable to cargo volumes and productivity issues.

   Matson's total Hawaii Service container volume, at 149,636 units, was one
percent lower than 2000 container volume of 151,496 units. Matson's total
Hawaii Service automobile volume, at 122,389 units, was seven percent lower
than 2000 automobile volume of 132,186 units. The lower cargo and automobile
volumes were primarily the result of the weakened Hawaii economy following the
September 11, 2001 terrorist attacks on the United States of America. These
attacks had a significantly adverse effect on air travel. This reduced Hawaii
tourism and, in turn, significantly reduced the fourth quarter carriage of
commercial cargo and automobiles to Hawaii. In January 2002, Matson reduced the
number of vessels in the Hawaii Service from eight to seven.

   In addition to the lower container and automobile carriage, transition
problems related to a terminal improvement project at Matson's Honolulu
terminal reduced productivity during the fourth quarter. Lower results from
Matson's investments in a shipping operation in Puerto Rico and from a
stevedoring joint venture also adversely affected the total-year results.

   A 3.5 percent increase in Hawaii Service rates announced in 2000 took effect
in February 2001. Total fuel costs decreased by $7,609,000 in 2001 versus 2000,
resulting in a decrease in the fuel surcharge from 4.25% to 3.25%.

   Property Leasing revenue of $70,685,000 was 14 percent higher than 2000
revenue of $62,105,000 and operating profit of $34,139,000 was 13 percent
higher than 2000 operating profit of $30,120,000. These increases were due
primarily to additions to the leased property portfolio and higher occupancy
levels in the Hawaii portfolio and increased royalty revenue. Occupancy levels
for the Mainland portfolio averaged 93 percent in 2001, versus 96 percent in
2000. The Company owned four million square feet of leasable improved property
on the Mainland at year-end 2001, the same as at the year-end 2000. Occupancy
levels for the Hawaii properties averaged 90% in 2001, versus 86% in 2000. The
Company owned 1.5 million square feet of leasable improved property in Hawaii
at year-end 2001 compared with 1.2 million square feet at year-end 2000.

   Property Sales revenue of $89,156,000 for 2001 compared with $46,322,000 of
revenue a year earlier. Operating profit was $17,926,000 for 2001 compared with
operating profit of $24,228,000 for 2000. These fluctuations are due primarily
to the changed composition of sales during the two years.

                                      20

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   The mix of property sales in any year can be diverse. Sales can include
property sold under threat of condemnation, developed residential real estate,
commercial properties, developable subdivision lots and undeveloped land. The
sale of undeveloped land and vacant parcels generally provides a greater
contribution margin than does the sale of residential, developed and commercial
property, due to the low historical-cost basis of the Company's Hawaii land.
Consequently, property sales revenue trends and the amount of real estate held
for sale on the balance sheets do not necessarily indicate future profitability
for this segment.

   Sales in 2001 included a 14-acre parcel at Maui Business Park to Wal-Mart,
three commercial properties in Bainbridge, Washington, a four-acre parcel on
Maui, 82 residential properties and a 68-acre parcel for highway widening on
Maui. Sales in 2000 included a ground lease under a Costco store, a 13-acre
parcel at Maui Business Park, 16 business parcels and 28 residential properties.

   Food Products revenue of $104,376,000 in 2001 compared with revenue of
$106,341,000 in 2000. Operating profit of $5,660,000 in 2001 was 25% lower than
the $7,522,000 earned in 2000. The benefits of higher domestic raw sugar and
molasses prices throughout 2001 and improved sales of natural sugars under the
Maui Brand(R) label were more than offset by a write-off of power generation
equipment which was no longer needed in the business, lower raw sugar
production and power sales, and lower results from A&B's minority investment in
C&H. The previously discussed impairment loss related to the Company's
investment in C&H was not included in segment operating profit.

   HC&S produced 191,512 tons of raw sugar during 2001, compared with 210,269
tons a year earlier. This lower production was the result of harvesting nearly
12.5% fewer acres in 2001, compared with 2000, combined with extended drought
conditions. Although drought conditions on Maui have lessened in late 2001 and
early 2002, this remains a primary risk factor for this business segment's
operations.

   For 2001, HC&S forward priced 95% of its 2001 crop at an average price of
$21.13/cwt. This forward pricing program started with the 2001 crop, following
an average sales price $19.10/cwt. for 2000. Through the forward pricing
program, HC&S expects to stabilize its 2002 raw sugar sales prices above
$21.00/cwt.

   A panelboard business, Hawaiian DuraGreen, was discontinued, due to
depressed sales prices and production problems. This is described more fully in
Note 3 to the consolidated financial statements included in Item 8.

   Other operating profit of $127,635,000 for 2001 was due primarily to the
sales of marketable equity securities during 2001. This is described more fully
in Note 5 of the consolidated financial statements included in Item 8.

2000 Compared with 1999

   Ocean Transportation revenue of $850,692,000 was nine percent higher than
1999 revenue of $778,535,000. Operating profit of $93,732,000 showed a
12-percent improvement over 1999 operating profit of $83,778,000. Hawaii
service container volume in 2000 was flat compared with 1999 and automobile
volume was 31 percent higher. The primary revenue gains occurred in the
lower-margin intermodal business. Operating results for 2000 benefited from
improved performance by the Company's SSAT terminal operating joint venture and
by its Matson Intermodal System subsidiary. Operating results for 1999 were
affected adversely by lower productivity, due to disruptions related to the
1999 renegotiation of longshore labor agreements.

   Matson's total Hawaii Service container volume was 151,496 units in 2000,
compared with 151,215 units in 1999. Matson's total Hawaii Service automobile
volume, at 132,186 units, was 31 percent higher than 1999 automobile volume of
101,095 units.

   A 3.9 percent increase in Hawaii Service rates announced in 1999 took effect
in February 2000. To mitigate partially the effect of rising fuel prices, the
1.75 percent fuel surcharge in effect at the end of 1999 was increased, in
three steps, to 4.25 percent during 2000. Total fuel costs increased by
$17,900,000 in 2000 versus 1999. This increased cost was only partially offset
by the fuel surcharge.

                                      21

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   Property Leasing revenue of $62,105,000 was 15 percent higher than 1999
revenue of $53,910,000, and operating profit of $30,120,000 improved ten
percent compared with 1999 operating profit of $27,497,000. These improvements
were due to higher occupancy levels, increased rents and newly acquired
properties. Occupancy rates for the Mainland properties averaged 96 percent in
2000, versus 94 percent in 1999. The Company owned four million square feet of
leasable property on the Mainland at year-end 2000, compared with 3.1 million
square feet at year-end 1999. Occupancy levels for the Hawaii properties
averaged 86 percent in 2000, versus 81 percent in 1999. The Company owned 1.2
million square feet of leasable property in Hawaii at the end of both 2000 and
1999.

   Property Sales revenue of $46,322,000 was down slightly from the $48,036,000
in sales recorded in 1999, while operating profit of $24,228,000 was 39 percent
higher than the $17,402,000 achieved in 1999, due to mix. Property sales in
2000 included the ground lease for a Costco store, a 13-acre parcel at Maui
Business Park, 16 business parcels and 28 residential properties. Sales in 1999
included an office/research building in Seattle, two developed business
parcels, three undeveloped parcels and 41 residential properties.

   Food Products revenue of $106,341,000 in 2000 compared with revenue of
$116,362,000 in 1999. Operating profit of $7,522,000 in 2000 was 33 percent
lower than the $11,310,000 earned in 1999. The primary reasons for the declines
were U.S. raw sugar prices, which were 20 percent below historical levels,
lower raw sugar production that resulted from continuing drought conditions on
the island of Maui, and the write down of certain assets associated with the
closure of the Company's raw sugar processing factory in Paia, Maui, which
consolidated the processing operation into one factory. These factors were
offset partially by benefit plan settlement gains, insurance-related gains at
Hawaiian Commercial & Sugar Company ("HC&S"), the Company's raw sugar producing
unit on Maui, and a profit turnaround at Kauai Coffee.

   Although HC&S harvested about the same number of acres, sugar production of
approximately 210,000 tons in 2000 was eight percent lower than the prior
year's production of 228,000 tons. Lower production was due to the drought
conditions noted earlier. The average No. 14 domestic raw sugar price for 2000
was $19.10/cwt. This was $3.08/cwt. below 1999's price of $22.18/cwt. and was
the lowest level in 20 years.

   Results from Kauai Coffee showed a small profit for 2000, following a
successful business re-engineering in 1999, which included the write-down of
its orchards and processing equipment to fair values and the implementation of
other business process improvements. In addition, sales and marketing efforts
were improved during 2000.

ECONOMIC OUTLOOK

   Although none of the Company's operations were directly affected by the East
Coast terrorist attacks of September 11, 2001, the events compounded
pre-existing concerns about the outlook for Hawaii's economy. They also created
unprecedented uncertainty about how to assess the extent, pace and duration of
the decline that continues to be felt throughout the United States. Pre-dating
the terrorist attacks were a slowing of the United States' economy and the
economic challenges in Asia. The combination of these events had a significant
effect on 2001 fourth quarter tourism and, consequently, A&B's Ocean
Transportation cargo volumes were lower than in previous quarters. The effect
on real-estate activities was moderate and there was little effect on the
Company's Food Products segment.

   The performance of the Ocean Transportation segment for 2002 will depend on
Matson's realizing the benefits of its Honolulu terminal improvement project,
balancing its service levels and cost structure to shipper demand and improving
returns from both its shipping investment in Puerto Rico and its stevedoring
joint venture.

   Even assuming continued economic recovery, Property Management & Development
operating profit for 2002 is expected to be modestly lower than 2001 operating
profit. Property leasing activity is forecast to continue at a steadily rising
pace, due to properties acquired in 2001, rent rollovers and possible new
acquisitions. Property sales revenue is expected to exceed 2001 sales revenue,
but the contribution to operating profit is expected to be lower, due to the
mix of higher basis property sales in 2002. Investment opportunities, in both
development and income-producing properties, and especially in Hawaii, remain a
primary growth focus.

                                      22

<p Style="page-break-after:always">

   The 2002 outlook for Food Products includes stable raw sugar prices, greater
raw-sugar production, as drought conditions reverse, and tight cost controls.
These positive factors are expected to boost Food Products' operating profit in
2002.

   In the aggregate, with the combination of operating profit growth from a low
base in Ocean Transportation, stable growth in Property Leasing, the timing of
real-estate sales, the normal seasonality of the Food Products segment, and
economic growth in Hawaii, it is likely that operating profit during the first
two, and possibly three, quarters of 2002 will be lower than comparable 2001
periods. It is expected that this would be followed by a return to more normal
trends by the end of 2002.

FINANCIAL CONDITION AND LIQUIDITY

   Liquid Resources:  Liquid resources of the Company, comprising cash and cash
equivalents, receivables, inventories and unused lines of credit, less accrued
deposits to the Capital Construction Fund (CCF), totaled $527,856,000 at
December 31, 2001, an increase of $282,784,000 from December 31, 2000. This net
increase was due primarily to additional credit facilities (see next paragraph
and Note 8), lower balances drawn on continuing facilities and higher cash
balances, partially offset by the termination of a $25,000,000 credit facility
that had expired in late 2000 and lower trade receivable balances.

   New Financing Agreements:  During 2001, the Company increased its revolving
credit and term loan agreement from $140,000,000 to $185,000,000 and extended
the term of the facility for three years, entered into a $50,000,000 private
shelf agreement and withdrew from a $25,000,000 uncommitted credit facility. In
addition, the Company's subsidiary, Matson, added a new $40,000,000 revolving
credit agreement and entered into a $50,000,000 private shelf agreement. This
additional capacity is reflected in liquid resources and the nature of the
facilities are described more fully in Note 8 to the consolidated financial
statements. These new and increased credit facilities may be used for possible
future real estate and ocean transportation related capital investments and
acquisitions.

   Working Capital:  Working capital was $24,445,000 at December 31, 2001, a
decrease of $31,416,000 from a year earlier. The lower working capital was due
primarily to higher income taxes and accounts payable, and to lower trade
receivables and prepaid assets, partially offset by higher other assets held
for sale and cash balances. The higher amount of income taxes payable was due
to the sale of BancWest Corporation shares in late December 2001. The lower
trade receivables balance was due primarily to a decrease in ocean
transportation revenue and to the timing of billing cycles that overlap
year-end. Higher other assets held for sale was due primarily to the
anticipated sale of two vessels, as described in Note 5 to the consolidated
financial statements. The fluctuations in accounts payable and prepaid assets
were in the ordinary course of business.

   Receivables:  At December 31, 2001, the Company had receivables totaling
$130,491,000, compared with $141,553,000 a year earlier. These amounts are net
of allowances for doubtful accounts of $7,252,000 and $6,579,000, respectively.
The decline in receivables was mainly the result of lower Matson cargo during
the fourth quarter of 2001. The Company's management believes that the quality
of these receivables is good and that its reserves are adequate.

   Operating Cash Flows:  Net cash provided by operations was $150,968,000 and
$104,278,000 for 2001 and 2000, respectively. Net operating cash flows were
used principally for capital expenditures, payments of debt, dividends,
repurchases of capital stock and deposits into the CCF. Withdrawals from the
CCF in 2001 were used principally for vessel modifications and equipment
purchases. Approximately $41,928,000 of taxes related to the December sales of
marketable equity securities was accrued as a current liability at year-end.
Although this improved 2001 operating cash flows, when the taxes are paid, 2002
operating cash flows will be comparably reduced.

   Capital Additions:  Capital additions comprise capital expenditures for
property and capital expenditures for real property (including the
re-deployment of non-cash tax deferred funds to purchase property) but excludes
capital expenditures for real-estate developments held for sale, since this
latter item is treated as inventory on the

                                      23

<p Style="page-break-after:always">

balance sheets. Capital additions during 2001 were $141,440,000, compared with
$106,904,000 in 2000. Ocean transportation capital additions in 2001 of
$59,669,000 were primarily for terminal improvements, vessel modifications,
technology investments and the acquisition of container and terminal equipment.
Property development and management capital additions in 2001 of $72,050,000
included $42,257,000 for the redeployment of tax deferred sales proceeds into
similar income producing assets and $29,793,000 for the development of real
estate, for improvements to leased properties, and for the purchase of
developed commercial property. Food products capital additions in 2001 of
$9,454,000 were primarily for routine factory modifications and replacements.

   Other Financing Arrangements:  As described in Notes 5 and 13 to the
consolidated financial statements, the Company or its subsidiaries guarantee
$31,500,000 of debt of an unconsolidated affiliate, guarantee up to $15,000,000
of debt of an unconsolidated sugar marketing and transportation cooperative,
and have $26,019,000 of standby letters of credit. These amounts are not
recorded on the Company's balance sheet. The Company does not currently expect
that it will be called upon to advance funds under these commitments.

   Other Commitments:  Capital expenditures approved but not yet spent were
$77,633,000 at December 31, 2001. These expenditures are primarily for real
estate developments held for investment purposes, containers and operating
equipment and vessel modifications. For 2002, internal cash flows and
short-term borrowing facilities are expected to be sufficient to finance
working capital needs, dividends, capital expenditures and debt service.

   Contingencies:  The Company and certain subsidiaries are parties to various
legal actions and are contingently liable in connection with claims and
contracts arising in the normal course of business, the outcome of which, in
the opinion of management after consultation with legal counsel, will not have
a material adverse effect on the Company's financial position or results of
operations.

OTHER MATTERS

   Tax-Deferred Real Estate Exchanges:  In 2001, the Company sold, on a
tax-deferred basis, nine properties for $31,854,000. These included the sales
of a 14-acre industrial lot to Wal-Mart, three commercial properties in
Bainbridge, Washington and a four-acre parcel on Maui and the sale under threat
of condemnation of a 68-acre parcel on Maui for highway widening. During the
year, the Company reinvested $42,257,000 in four replacement properties. At
December 31, 2001, $2,200,000 of tax deferred proceeds had not been reinvested
compared to $12,900,000 at the end of 2000.

   Funds received in tax-deferred sales of like-kind property are held by a
third party agent and are included in other non-current assets on the Balance
Sheets. These proceeds and the subsequent purchases of replacement property are
reported in the Statements of Cash Flows under the caption "Non-cash
Activities." Funds received for sales under threat of condemnation are not
required to be held by a third party agent and are included in cash flows from
investing activities.

   Environmental Matters:  As with most industrial and land-development
companies of its size, the Company's operations have certain risks that could
result in expenditures for environmental remediation. The Company believes that
it is in compliance, in all material respects, with applicable environmental
laws and regulations, and works proactively to identify potential environmental
concerns. Management believes that appropriate liabilities have been accrued
for environmental matters.

   Dependence on Information Technology Systems:  The Company is partially
dependent on information technology systems to support its ability to conduct
business. These dependencies primarily include accounting, billing, payable,
cargo booking, vessel scheduling and stowage, banking, payrolls and employee
communications. All of these systems are vulnerable to reliability issues,
integration and compatibility concerns, and security-threatening intrusions.
The Company has had no significant instances of interruption to these systems.

   Management believes that its information technology and systems are adequate
to meet the requirements of its business and operations. It continues to make
investments of capital for infrastructure, system development and

                                      24

<p Style="page-break-after:always">

maintenance, system security and staffing and staff development. However, there
can be no assurances that future incidents, whether accidental or malicious,
could not affect adversely the function of the Company's information systems
and operations.

   Significant Accounting Policies:  The Company's significant accounting
policies and the impacts of newly issued accounting standards are described in
Notes 1 and 2 to the consolidated financial statements included in Item 8.

   Management Changes:  During 2001, the Company hired Raymond L. Smith as
Matson's Chief Operating Officer, a newly created position, and hired Matthew
J. Cox as Matson's Senior Vice President, Chief Financial Officer and
Controller, the latter replacing Raymond J. Donohue, who retired. Also, in
2001, Christopher J. Benjamin joined A&B as Director of Corporate Development
and Planning, and Michael G. Wright joined A&B Properties, Inc. as Vice
President, Acquisitions and Investments.

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

   A&B, in the normal course of doing business, is exposed to the risks
associated with fluctuations in the market value of certain financial
instruments. A&B maintains a portfolio of investments, pension fund investments
and, through its Capital Construction Fund, an investment in mortgage-backed
securities. Details regarding these financial instruments are described in
Notes 4, 5, 7 and 10 to the consolidated financial statements in Item 8,
"Financial Statements and Supplementary Data."

   A&B also is exposed to changes in U.S. interest rates, primarily as a result
of its borrowing and investing activities used to maintain liquidity and to
fund business operations. Details regarding these matters are described in Note
8 in Item 8, "Financial Statements and Supplementary Data." The Company does
not use interest rate derivative instruments such as interest rate swaps,
currency swaps, futures or options, to manage its exposure to interest rate
risk or for speculative purposes but may choose to use such instruments to
manage interest rate risk in the future.

   A&B's sugar plantation, HC&S, has a contract to sell its raw sugar
production to Hawaiian Sugar & Transportation Cooperative ("HS&TC"), an
unconsolidated sugar and marketing cooperative, in which the Company has an
ownership interest, until June 2003. Under that contract, the price paid will
fluctuate with the New York Contract #14 settlement price for domestic raw
sugar, less a fixed discount. The Company also has an agreement with C&H Sugar
Company, Inc, the primary purchaser of sugar from HS&TC, which allows the
Company to forward price, with C&H, a portion of its raw sugar deliveries to
HS&TC.

   The Company has no direct material exposure to foreign currency risks,
although it is indirectly affected by changes in currency rates to the extent
that this affects tourism in Hawaii.

   A&B believes that, as of December 31, 2001, its exposure to market risk
fluctuations for its financial instruments was not material.

                                      25

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ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA



                                                                      Page
                                                                      ----
                                                                   
     Management's Report.............................................  27
     Independent Auditors' Report....................................  28
     Consolidated Statements of Income...............................  29
     Consolidated Statements of Cash Flows...........................  30
     Consolidated Balance Sheets.....................................  31
     Consolidated Statements of Shareholders' Equity.................  32
     Notes to Consolidated Financial Statements......................  33
        1.  Summary of Significant Accounting Policies...............  33
        2.  Changes in Accounting Methods............................  36
        3.  Discontinued Operations..................................  36
        4.  Impairment of Long-Lived Assets and Investments..........  37
        5.  Investments..............................................  38
        6.  Property.................................................  40
        7.  Capital Construction Fund................................  40
        8.  Notes Payable and Long-term Debt.........................  41
        9.  Leases...................................................  42
       10.  Employee Benefit Plans...................................  44
       11.  Income Taxes.............................................  47
       12.  Stock Options............................................  47
       13.  Related Party Transactions, Commitments and Contingencies  50
       14.  Industry Segments........................................  50
       15.  Quarterly Information (Unaudited)........................  53
       16.  Parent Company Condensed Financial Information...........  55


                                      26

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MANAGEMENT'S RESPONSIBILITY FOR FINANCIAL REPORTING

   The management of Alexander & Baldwin, Inc. has the responsibility for
preparing the accompanying consolidated financial statements and related notes
accurately and objectively. The statements have been prepared in accordance
with accounting principles generally accepted in the United States of America,
consistently applied, and necessarily include amounts based on judgments and
estimates made by management. Management also prepared the other information in
this annual report and is responsible for its accuracy and consistency with the
consolidated financial statements.

   The Company maintains internal control systems, and related policies and
procedures, designed to provide reasonable assurance that assets are
safeguarded, that transactions are properly executed and recorded in accordance
with management's authorization, and that underlying accounting records may be
relied upon for the accurate preparation of the consolidated financial
statements and other financial information. The design, monitoring and revision
of internal control systems involve, among other things, management's judgment
with respect to the relative cost and expected benefits of specific control
measures. The Company maintains an internal auditing function that evaluates
and formally reports on the adequacy and effectiveness of internal controls,
policies and procedures.

   The Company's consolidated financial statements have been audited by
Deloitte & Touche LLP, its independent auditors, who have expressed their
opinion with respect to the fairness, in all material aspects, of the
presentation of financial position, results of operations and cash flows under
accounting principles generally accepted in the United States of America.
Management has made available to Deloitte & Touche LLP all of the Company's
financial records and related data. Furthermore, management believes that all
representations made to Deloitte & Touche LLP during its audit were valid and
appropriate.

   The Board of Directors, through its Audit Committee (composed of
non-employee directors), oversees management's responsibilities in the
preparation of the consolidated financial statements and nominates the
independent auditors, subject to shareholder election. The Audit Committee
meets regularly with the external and internal auditors to evaluate the
effectiveness of their work in discharging their respective responsibilities
and to assure their independent and free access to the Committee.


                                       


/s/ W. Allen Doane                        /s/ James S. Andrasick

W. Allen Doane                            James S. Andrasick
President and Chief Executive Officer     Senior Vice President
                                          and Chief Financial Officer

                                      27

<p Style="page-break-after:always">

                         INDEPENDENT AUDITORS' REPORT

TO THE SHAREHOLDERS OF ALEXANDER & BALDWIN, INC.:

   We have audited the accompanying consolidated balance sheets of Alexander &
Baldwin, Inc. and subsidiaries as of December 31, 2001 and 2000 , and the
related consolidated statements of income, shareholders' equity, and cash flows
for each of the three years in the period ended December 31, 2001. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

   We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audits to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.

   In our opinion, such consolidated financial statements present fairly, in
all material respects, the financial position of Alexander & Baldwin, Inc. and
subsidiaries at December 31, 2001 and 2000, and the results of their operations
and their cash flows for each of the three years in the period ended December
31, 2001 in conformity with accounting principles generally accepted in the
United States of America.

   As discussed in Note 2 to the consolidated financial statements, the Company
adopted a new accounting standard for reporting discontinued operations in 2001
and changed its method of accounting for vessel drydocking costs in 2000.

/s/ Deloitte & Touche, LLP
Deloitte & Touche LLP
Honolulu, Hawaii
January 24, 2002

                                      28

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                           ALEXANDER & BALDWIN, INC.
                       CONSOLIDATED STATEMENTS OF INCOME
                   (In thousands, except per-share amounts)



                                                                                 Year Ended December 31,
                                                                             -------------------------------
                                                                                2001        2000      1999
                                                                             ----------  ---------- --------
                                                                                           
Revenue:
 Ocean transportation....................................................... $  787,173  $  839,535 $768,414
 Property leasing...........................................................     70,247      61,710   53,416
 Property sales.............................................................     88,911      46,158   47,894
 Food products..............................................................    105,976     102,229  113,680
 Gain on sale of investments................................................    125,478          --       --
 Interest and dividends.....................................................     12,288      19,014   16,594
                                                                             ----------  ---------- --------
   Total revenue............................................................  1,190,073   1,068,646  999,998
                                                                             ----------  ---------- --------
Costs and Expenses:
 Cost of transportation services............................................    656,795     687,223  628,104
 Cost of property sales and leasing services................................    101,000      47,366   51,764
 Cost of agricultural goods and services....................................     98,718      98,820  105,052
 Selling, general and administrative........................................     99,097      88,270   86,354
 Impairment loss on long-lived assets and investments.......................     28,600          --   15,410
 Interest expense...........................................................     18,658      24,252   17,774
                                                                             ----------  ---------- --------
   Total costs and expenses.................................................  1,002,868     945,931  904,458
                                                                             ----------  ---------- --------
Income From Continuing Operations Before Income Taxes and Cumulative
  Effect of Change in Accounting Method.....................................    187,205     122,715   95,540
 Income taxes...............................................................     67,392      44,391   32,961
                                                                             ----------  ---------- --------
Income From Continuing Operations Before Cumulative Effect of Change In
  Accounting Method.........................................................    119,813      78,324   62,579
 Discontinued operations, net of income taxes (See Notes 2 and 3)...........     (9,185)         --       --
 Cumulative effect of change in accounting method, net of income taxes
   (See Note 2).............................................................         --      12,250       --
                                                                             ----------  ---------- --------
Net Income..................................................................    110,628      90,574   62,579
 Unrealized holding gains (losses) and reclassification of realized gains on
   securities (net of income taxes of $36,371, $7,525, and $8,088)..........    (61,937)     12,476  (13,868)
                                                                             ----------  ---------- --------
Comprehensive Income........................................................ $   48,691  $  103,050 $ 48,711
                                                                             ==========  ========== ========
Basic Earnings per Share of Common Stock:
 From continuing operations before cumulative effect of change in accounting $     2.96  $     1.92 $   1.45
 Discontinued operations....................................................      (0.23)         --       --
 Accounting change..........................................................         --        0.29       --
                                                                             ----------  ---------- --------
 Net income................................................................. $     2.73  $     2.21 $   1.45
                                                                             ==========  ========== ========
Diluted Earnings per Share of Common Stock:
 From continuing operations before cumulative effect of change in accounting $     2.94  $     1.91 $   1.45
 Discontinued operations....................................................      (0.22)         --       --
 Accounting change..........................................................         --        0.30       --
                                                                             ----------  ---------- --------
 Net income................................................................. $     2.72  $     2.21 $   1.45
                                                                             ==========  ========== ========
Average Common Shares Outstanding...........................................     40,535      40,898   43,206


                See notes to consolidated financial statements.

                                      29

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                           ALEXANDER & BALDWIN, INC.
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                (In thousands)



                                                                                Year Ended December 31,
                                                                            ------------------------------
                                                                              2001       2000      1999
                                                                            ---------  --------  ---------
                                                                                        
Cash Flows from Operations:
 Net income................................................................ $ 110,628  $ 90,574  $  62,579
 Adjustments to reconcile net income to net cash provided by operations:
   Depreciation and amortization...........................................    75,433    72,304     73,901
   Deferred income taxes...................................................    (7,389)   17,358      8,465
   Gains on disposal of assets.............................................  (142,567)  (26,495)   (13,170)
   Equity in (income) loss of affiliates...................................    13,166    (6,859)    (3,002)
   Write-down of long-lived assets and investments.........................    44,797        --     15,410
   Change in accounting method.............................................        --   (12,250)        --
   Changes in assets and liabilities:
     Accounts and notes receivable.........................................     2,250    (4,161)    (6,007)
     Inventories...........................................................       857    (1,219)    (1,326)
     Prepaid expenses and other assets.....................................     7,823    (7,933)    (8,852)
     Pension and post-retirement assets and obligations....................   (21,149)  (26,169)   (18,174)
     Accounts and income taxes payable.....................................    62,205     9,305     10,436
     Other liabilities.....................................................    (2,766)   10,235     (3,408)
   Real estate developments held for sale:
     Cost of real estate inventory sales...................................    39,831     6,088      2,509
     Expenditures for new real estate inventory............................   (32,151)  (16,500)    (9,982)
                                                                            ---------  --------  ---------
     Net cash provided by operations.......................................   150,968   104,278    109,379
                                                                            ---------  --------  ---------
Cash Flows from Investing Activities:
 Capital expenditures for property and developments........................   (99,183)  (84,201)   (68,606)
 Receipts from disposal of income producing property, investments and other
   assets..................................................................   141,909     3,877      3,688
 Deposits into Capital Construction Fund...................................   (12,071)  (12,220)   (19,464)
 Withdrawals from Capital Construction Fund................................     4,217     8,574     11,458
 (Increase) decrease in investments--net...................................    (1,700)      894     (3,285)
                                                                            ---------  --------  ---------
     Net cash used in investing activities.................................    33,172   (83,076)   (76,209)
                                                                            ---------  --------  ---------
Cash Flows from Financing Activities:
 Proceeds from issuance of long-term debt..................................     6,000    98,500     39,500
 Payments of long-term debt................................................  (137,000)  (48,000)   (30,533)
 Proceeds (payments) from short-term borrowings--net.......................    (3,100)   10,500    (52,000)
 Repurchases of capital stock..............................................    (2,270)  (48,260)   (34,824)
 Proceeds from issuance of capital stock...................................     4,558     2,961        101
 Dividends paid............................................................   (36,488)  (36,785)   (38,899)
                                                                            ---------  --------  ---------
     Net cash used in financing activities.................................  (168,300)  (21,084)  (116,655)
                                                                            ---------  --------  ---------
Cash and Cash Equivalents:
 Net increase (decrease) for the year......................................    15,840       118    (83,485)
 Balance, beginning of year................................................     3,451     3,333     86,818
                                                                            ---------  --------  ---------
 Balance, end of year...................................................... $  19,291  $  3,451  $   3,333
                                                                            =========  ========  =========
Other Cash Flow Information:
 Interest paid, net of amounts capitalized................................. $ (19,546) $(24,663) $ (17,772)
 Income taxes paid, net of refunds.........................................   (20,961)  (31,807)   (34,213)
Non-cash Activities:
 Tax-deferred property sales...............................................    29,963    35,569     34,883
 Tax-deferred property purchases...........................................   (42,257)  (22,703)   (34,907)
 Transfer of assets to joint venture.......................................        --        --     16,438


                See notes to consolidated financial statements.

                                      30

<p Style="page-break-after:always">

                           ALEXANDER & BALDWIN, INC.
                          CONSOLIDATED BALANCE SHEETS
                    (In thousands, except per-share amount)



                                                                          December 31,
                                                                     ----------------------
                                                                        2001        2000
                                                                     ----------  ----------
                                           ASSETS
                                           ------
                                                                           
Current Assets
 Cash and cash equivalents.......................................... $   19,291  $    3,451
 Accounts and notes receivable, less allowances of $7,252 and $6,579    130,491     141,553
 Sugar and coffee inventories.......................................      4,875       4,435
 Materials and supplies inventories.................................     11,405      12,702
 Real estate and other assets held for sale.........................     35,584      19,324
 Deferred income taxes..............................................      9,324      13,186
 Prepaid expenses and other assets..................................     13,044      18,736
 Accrued deposits to Capital Construction Fund......................     (4,000)     (4,520)
                                                                     ----------  ----------
   Total current assets.............................................    220,014     208,867
Investments.........................................................     33,021     183,141
Real Estate Developments............................................     47,840      62,628
Property--net.......................................................    977,048     954,692
Capital Construction Fund...........................................    158,737     150,405
Pension Assets......................................................     63,300      50,476
Other Assets--net...................................................     44,459      55,803
                                                                     ----------  ----------
   Total............................................................ $1,544,419  $1,666,012
                                                                     ==========  ==========

                            LIABILITIES AND SHAREHOLDERS' EQUITY
                            ------------------------------------
Current Liabilities
 Notes payable and current portion of long-term debt................ $   19,900  $   30,500
 Accounts payable...................................................     78,911      63,075
 Payrolls and vacation due..........................................     17,058      18,170
 Uninsured claims...................................................     13,017      11,514
 Income taxes payable...............................................     42,899          --
 Post-retirement benefit obligations--current portion...............      2,317       2,213
 Accrued and other liabilities......................................     21,467      27,534
                                                                     ----------  ----------
   Total current liabilities........................................    195,569     153,006
                                                                     ----------  ----------
Long-term Liabilities
 Long-term debt.....................................................    207,378     330,766
 Deferred income taxes..............................................    338,709     387,139
 Post-retirement benefit obligations................................     42,915      44,752
 Uninsured claims and other.........................................     49,181      56,698
                                                                     ----------  ----------
   Total long-term liabilities......................................    638,183     819,355
                                                                     ----------  ----------
Commitments and Contingencies
Shareholders' Equity
 Capital stock--common stock without par value; authorized,
   150,000 shares ($.75 stated value per share); outstanding,
   40,529 shares in 2001 and 40,353 shares in 2000..................     33,328      33,248
 Additional capital.................................................     66,659      58,007
 Unrealized holding gains on securities.............................         --      61,937
 Retained earnings..................................................    622,615     552,637
 Cost of treasury stock.............................................    (11,935)    (12,178)
                                                                     ----------  ----------
   Total shareholders' equity.......................................    710,667     693,651
                                                                     ----------  ----------
   Total............................................................ $1,544,419  $1,666,012
                                                                     ==========  ==========


                See notes to consolidated financial statements.

                                      31

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                           ALEXANDER & BALDWIN, INC.
                CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
                  For the three years ended December 31, 2001
                   (In thousands, except per-share amounts)



                                                  Capital Stock
                                        --------------------------------
                                             Issued        In Treasury
                                        ---------------  ---------------             Unrealized
                                                Stated                    Additional  Holding   Retained
                                        Shares  Value    Shares   Cost     Capital     Gains    Earnings
                                        ------  -------  ------ --------  ---------- ---------- --------
                                                                           
Balance, December 31, 1998............. 48,132  $36,098  4,104  $(12,551)  $51,946    $ 63,329  $555,820
Shares repurchased..................... (1,565)  (1,173)    --        --        --          --   (33,651)
Stock options exercised................      5        4     --        --        97          --        --
Issued--incentive plans................      7        4    (51)      147     1,081          --        --
Unrealized holding loss................     --       --     --        --        --     (13,868)       --
Net income.............................     --       --     --        --        --          --    62,579
Cash dividends.........................     --       --     --        --        --          --   (38,899)
                                        ------  -------  -----  --------   -------    --------  --------
Balance, December 31, 1999............. 46,579   34,933  4,053   (12,404)   53,124      49,461   545,849
Shares repurchased..................... (2,378)  (1,783)    --        --        --          --   (46,477)
Stock options exercised................    126       94     --        --     3,378          --      (524)
Issued--incentive plans................      4        4    (75)      226     1,505          --        --
Unrealized holding gain................     --       --     --        --        --      12,476        --
Net income.............................     --       --     --        --        --          --    90,574
Cash dividends.........................     --       --     --        --                    --   (36,785)
                                        ------  -------  -----  --------   -------    --------  --------
Balance, December 31, 2000............. 44,331   33,248  3,978   (12,178)   58,007      61,937   552,637
Shares repurchased.....................   (105)     (79)    --        --        --          --    (2,192)
Stock options exercised--net...........    207      155     --        --     6,908          --    (1,970)
Issued--incentive plans................      4        4    (70)      243     1,744          --        --
Reversal of holding gains/1/...........     --       --     --        --        --     (61,937)       --
Net income.............................     --       --     --        --        --          --   110,628
Cash dividends.........................     --       --     --        --        --          --   (36,488)
                                        ------  -------  -----  --------   -------    --------  --------
Balance, December 31, 2001............. 44,437  $33,328  3,908  $(11,935)  $66,659    $     --  $622,615
                                        ======  =======  =====  ========   =======    ========  ========


/1/ See Note 5 for discussion of marketable equity securities sold during 2001.

                See notes to consolidated financial statements.

                                      32

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ALEXANDER & BALDWIN, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

   Principles of Consolidation:  The consolidated financial statements include
the accounts of Alexander & Baldwin, Inc. and all wholly owned subsidiaries
("Company"), after elimination of significant intercompany amounts. Significant
investments in businesses, partnerships and joint ventures in which the Company
does not have control are accounted for under the equity method. Generally,
these are investments in businesses in which the Company's ownership is between
20 and 50 percent.

   Segment Information:  The Company has three operating segments: Ocean
Transportation, Property Development and Management, and Food Products. The
Company reports segment information in the same way that management assesses
segment performance. Additional information regarding these segments is found
in Note 14.

   Cash and Cash Equivalents:  Cash equivalents are composed of all highly
liquid investments with an original maturity of three months or less and which
have no significant risk of change in value.

   Inventories:  Raw sugar and coffee inventories are stated at the lower of
cost (first-in, first-out basis) or market. Other inventories, composed
principally of materials and supplies, are stated at the lower of cost
(principally average cost) or market. Materials and supplies inventories are
carried at historical cost, which is not greater than replacement cost.

   Property:  Property is stated at cost. Expenditures for major renewals and
betterments are capitalized. Replacements, maintenance and repairs that do not
improve or extend asset lives are charged to expense as incurred. Gains or
losses from property disposals are included in the determination of net income.
As discussed in Note 2, the Company changed its accounting for drydocking costs
in 2000. Costs of regularly scheduled drydocking of vessels and planned major
vessel repairs performed during drydocking are capitalized and amortized over
the periods benefited.

   Coffee Orchards:  Costs of developing coffee orchards are capitalized during
the development period and depreciated over the estimated productive lives. In
1999, following the provisions of Statement of Financial Accounting Standards
No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to Be Disposed Of," the Company reduced the carrying value of its coffee
orchards and field and factory processing equipment. This is described further
in Note 4.

   Capitalized Interest:  Interest costs incurred in connection with
significant expenditures for real estate developments or the construction of
assets are capitalized. Interest expense is shown net of capitalized interest
on the Statements of Income, because the amounts are not significant.

   Construction Expenditures:  Expenditures for real estate developments are
capitalized during construction and are classified as Real Estate Developments
on the Consolidated Balance Sheets. When construction is complete, the costs
are reclassified as either Real Estate Held for Sale or Property, based upon
the Company's intent to sell the completed asset or to hold it as an
investment. Cash flows related to real estate developments are classified as
either operating or investing activities, based upon the Company's intention to
sell the property or to retain ownership of the property as an investment
following completion of construction.

   Depreciation:  Depreciation is computed using the straight-line method.
Estimated useful lives of property are as follows:



                    Classification       Range of Life (in years)
                    --------------       ------------------------
                                      
               Buildings................         10 to 50
               Vessels..................         10 to 40
               Marine containers........          2 to 25
               Terminal facilities......          3 to 35
               Machinery and equipment..          3 to 35
               Utility systems and other          5 to 60


                                      33

<p Style="page-break-after:always">

   Fair Value of Financial Instruments:  The fair values of cash and cash
equivalents, receivables and short-term and long-term borrowings approximate
their carrying values.

   Fair Value of Real-Estate Assets:  Real estate is carried at the lower of
cost or fair value. Fair values generally are determined using the expected
market value for the property, less sales costs. For residential units and lots
held for sale, market value is determined by reference to the sales of similar
property, market studies, tax assessments and cash flows. For commercial
property, market value is determined using recent comparable sales, tax
assessments and cash flows. A large portion of the Company's real estate is
undeveloped land located in Hawaii on the Islands of Maui and Kauai. This land
has a cost basis that averages approximately $150 per acre, a value much lower
than fair value.

   Impairments of Long-lived Assets:  Long-lived assets are reviewed for
possible impairment when events or circumstances indicate that the carrying
value may not be recoverable. In such evaluation, the estimated future
undiscounted cash flows generated by the asset are compared with the amount
recorded for the asset to determine if a write-down may be required. If this
review determines that the recorded value will not be recovered, the amount
recorded for the asset is reduced to estimated fair value. (See Note 4.)

   Voyage Revenue Recognition:  Voyage revenue and variable costs and expenses
associated with voyages are included in income at the time each voyage leg
commences. This method of accounting does not differ materially from other
acceptable accounting methods. Freight rates are provided in tariffs filed with
the Surface Transportation Board of the U.S. Department of Transportation.

   Real Estate Sales Revenue Recognition:  Sales are recorded when the risks
and benefits of ownership have passed to the buyers (generally on closing
dates), adequate down payments have been received, and collection of remaining
balances is reasonably assured.

   Sugar and Coffee Revenue Recognition:  Revenue from bulk raw sugar sales is
recorded when delivered to the cooperative of Hawaiian producers based on the
estimated net return to producers in accordance with contractual agreements.
Revenue from coffee is recorded when the title to the product and risk of loss
passes to third parties (generally this occurs when the product is shipped or
delivered to customers) and when collection is reasonably assured.

   Non-voyage Ocean Transportation Costs:  Vessel depreciation, charter hire,
terminal operating overhead and general and administrative expenses are charged
to expense as incurred.

   Agricultural Costs:  Costs of growing and harvesting sugar cane are charged
to the cost of production in the year incurred and to cost of sales as raw
sugar is delivered to the cooperative of Hawaiian producers as allowed in
Statement of Position No. 85-3. Costs of growing coffee are charged to
inventory in the year incurred and to cost of sales as coffee is sold.

   Employee Benefit Plans:  Certain ocean transportation subsidiaries are
members of the Pacific Maritime Association (PMA) and the Hawaii Stevedoring
Industry Committee, which negotiate multi-employer pension plans covering
certain shoreside bargaining unit personnel. The subsidiaries directly
negotiate multi-employer pension plans covering other bargaining unit
personnel. Pension costs are accrued in accordance with contribution rates
established by the PMA, the parties to a plan or the trustees of a plan.
Several trusteed, noncontributory, single-employer defined benefit plans and
defined contribution plans cover substantially all other employees.

   Stock-based Compensation:  As allowed by Statement of Financial Accounting
Standards (SFAS) No. 123, "Accounting for Stock-Based Compensation," the
Company has elected to continue to apply the provisions of Accounting
Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees," as
discussed in Note 12.

   Income Taxes:  Deferred tax assets and liabilities are established for
temporary differences between the way certain income and expense items are
reported for financial reporting and tax purposes. Deferred tax assets and

                                      34

<p Style="page-break-after:always">

liabilities are adjusted to the extent necessary to reflect tax rates expected
to be in effect when the temporary differences reverse. A valuation allowance
is established for deferred tax assets for which realization is not likely.

   Basic and Diluted Earnings per Share of Common Stock:  Basic Earnings per
Share is determined by dividing Net Income by the weighted-average common
shares outstanding during the year. The calculation of Diluted Earnings per
Share includes the effect of unexercised options to purchase the Company's
stock.

   Comprehensive Income:  Comprehensive Income includes changes from either
recognized transactions or other economic events, excluding capital stock
transactions, which impact Shareholders' Equity. For the Company, the only
difference between Net Income and Comprehensive Income is the unrealized
holding gains on securities available for sale. Comprehensive Income is not
used in the calculation of Earnings per Share. (See Note 5 for a discussion of
the liquidation of marketable equity securities.)

   Environmental Costs:  Environmental expenditures that relate to current
operations are expensed or capitalized, as appropriate. Expenditures that
relate to an existing condition caused by past operations or events, and which
do not contribute to current or future revenue generation, are charged to
expense. Liabilities are recorded when environmental assessments or remedial
efforts are probable and the costs can be estimated reasonably.

   Use of Estimates:  The preparation of the consolidated financial statements
in conformity with generally accepted accounting principles requires management
to make estimates and assumptions that affect the amounts reported in the
consolidated financial statements and accompanying notes. Future actual amounts
could differ from those estimates.

   Impact of Newly Issued Accounting Standards:  On January 1, 2001, the
Company adopted SFAS No. 133, "Accounting for Derivative Instruments and
Hedging Activities," as amended, which establishes the accounting and reporting
standards for derivative instruments and hedging activities. The adoption of
this standard did not have a material effect on the consolidated financial
statements.

   In 2000, the Company adopted SFAS No. 140, "Accounting for Transfers and
Servicing of Financial Assets and Extinguishment of Liabilities." SFAS No. 140
provides standards for transfers and servicing of financial assets and
extinguishments of liabilities using a financial-components approach that
focuses on control. The adoption of this standard did not have a material
effect on the consolidated financial statements.

   SFAS No. 141 "Business Combinations" was issued in June 2001 and became
effective in July 2001. This statement requires the purchase method of
accounting for business combinations. This standard will affect how the Company
accounts for new business combinations, but the adoption of the standard in
2001 had no effect on the Company's current year's consolidated financial
statements.

   SFAS No. 142 "Goodwill and Other Intangible Assets" was issued in June 2001
and is effective in January 2002. This statement addresses how intangible
assets, including goodwill, should be accounted for in the consolidated
financial statements. The new statement, which will be adopted by the Company
in January, 2002, will not have a material effect on the consolidated financial
statements.

   SFAS No. 143 "Accounting for Asset Retirement Obligations" was issued in
June 2001 and becomes effective in January 2003. This statement addresses
accounting and reporting for obligations and costs which will occur when
long-term assets are retired. Among other things, the statement requires that
the present value of the liability associated with future asset retirements be
recorded on the balance sheet when an obligation has been incurred and when it
can be measured. The amortization of the capitalized cost and increases in the
present value of the obligation which result from the passage of time, are
recorded as charges to earnings. The possible financial impacts of this
standard, when it is adopted by the Company in January 2003, are not yet known,
but are being assessed.

   Reclassifications:  Certain amounts in the 2000 and 1999 consolidated
financial statements have been reclassified to conform with the 2001
presentation.

                                      35

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2.  CHANGES IN ACCOUNTING METHODS

   2001--Adoption of New Accounting Standard for Reporting Discontinued
Operations:  SFAS No. 144, "Accounting for the Impairment or Disposal of
Long-Lived Assets" was issued in August 2001 and becomes effective in January
2002. However, as permitted by the standard, the Company adopted SFAS No. 144
effective January 1, 2001. This statement replaces previous accounting
standards related to asset impairments and provides guidance concerning the
recognition and measurement of impairment losses for certain types of long-term
assets. The statement recommends the use of probability-weighted cash flow
estimations, precludes accruing future operating losses prior to asset
disposal, expands the scope of "discontinued operations" to include a component
of an entity, and eliminates the current exemption to consolidation when
control over a subsidiary is likely to be temporary. The statement changes how
the Company analyzes and accounts for asset impairments and discontinued
operations, but, upon adoption, it had no immediate financial impacts. During
the fourth quarter of 2001, the Company recorded a loss from the abandonment of
its panelboard manufacturing facility, which it classified as Discontinued
Operations. This is described in Note 3 to the consolidated financial
statements.

   2000--Change in Accounting Method for Vessel Drydocking Costs:  The Company
changed its method of accounting for vessel drydocking costs, as of January 1,
2000, from the accrual method to the deferral method. Drydocking costs had been
accrued as a liability and an expense on an estimated basis, in advance of the
next scheduled drydocking. Subsequent payments for drydocking were charged
against the accrued liability. Under the deferral method, actual drydocking
costs are capitalized when incurred and amortized over the period benefited;
generally, this is the period between scheduled drydockings. This method
eliminates the uncertainty of estimating these costs. This change was made to
conform with prevailing industry accounting practices. The cumulative effect of
this accounting change, as of January 1, 2000, is shown separately in the
Consolidated Statements of Income and increased net income by $12,250,000 (net
of income tax expense of $7,668,000), or $0.29 per basic share.

   The effect of this change in accounting method on the balance sheets, as of
December 31, 2000, was to increase other assets by $4,765,000, eliminate
drydocking reserves of $15,153,000, increase deferred taxes by $7,668,000, and
increase shareholders' equity by $12,250,000. Had this change been applied
retroactively, the impact on net income for 1999 would not have been materially
different from reported net income.

   2000--Change in Accounting for Certain Revenues and Expenses:  The Company
changed its method of presentation for certain freight services that are
performed by third parties and billed by the Company to its customers. The
expenses and related revenue for these services previously were reported on a
net basis and were not reflected in the Consolidated Statements of Income.
Accordingly, operating revenue and expenses for 2000 and 1999 were increased by
$38,059,000 and $31,874,000, respectively. For 2001, the amount billed for
these services was approximately $32,764,000.

   The Company also changed its method of presentation for common area
maintenance (CAM) costs. These costs, which are incurred by the Company but
which are charged to tenants under various lease arrangements, previously were
netted against Property Leasing Revenue. The Company now records CAM amounts in
Costs of Leasing Services in the Consolidated Statements of Income.
Accordingly, Property Leasing Revenue and Costs of Leasing Services for 2000
and 1999 were increased by $11,246,000 and $8,852,000, respectively. For 2001,
the CAM costs totaled $12,207,000.

   These two changes were in response to the Securities and Exchange
Commission's Staff Accounting Bulletin No. 101, "Revenue Recognition in
Financial Statements," which provides guidance about the classification, on a
gross basis, of revenues and expenses. These changes had no effect on earnings
or segment operating profit.

3.  DISCONTINUED OPERATIONS

   The Company ceased the operations of and abandoned its panelboard
manufacturing business operated by Hawaiian DuraGreen, Inc., a wholly-owned
subsidiary ("DuraGreen"). This subsidiary constructed a production

                                      36

<p Style="page-break-after:always">

facility during 1999 and 2000 with an initial capital investment of
approximately $12,500,000. DuraGreen produced a panelboard product using
bagasse, a byproduct in the production of raw cane-sugar, for use in various
furniture and construction applications. After nearly a year of production
issues, poor operating results and weaknesses in the panelboard market,
management determined that the Company's investment in the business will not be
recovered and profitability could not be achieved. The 2001 loss from
Discontinued Operations includes operating losses and closure costs of
$2,964,000 and a $11,387,000 write-down of the production assets to their
estimated salvage value, net of a total income tax benefit of approximately
$5,166,000. There were no operations in prior years. The Consolidated Balance
Sheet at December 31, 2000 included assets of $11,616,000 for DuraGreen. This
amount principally was machinery and equipment.

4.  IMPAIRMENT OF LONG-LIVED ASSETS AND INVESTMENTS

   2001--As described in Note 5, the Company holds common and preferred stock
holdings in C&H Sugar Company, Inc. ("C&H"). As a result of operating losses
and declining cash flows at C&H, combined with adverse market changes, the
Company concluded that C&H's estimated future earnings and cash flows would not
allow recovery of the carrying value of the Company's investments. This loss in
value was considered an "other than temporary" impairment condition;
accordingly, the carrying values of the investments were written down by
$28,600,000 during the fourth quarter of 2001. The loss includes a write-down
of the common stock and junior preferred stock values to zero, and a write-down
of the senior preferred stock to approximately $11,500,000. The amount of the
write-down was based on the valuation of the common, and junior and senior
preferred stocks, as conducted by an independent valuation firm. Accepted
valuation practices were utilized in determining these investments' fair
values, including the market and income approaches, discounted cash flow
method, and market yield analysis. The valuation considered the Company's
minority position, the illiquidity of these types of investments in the public
market, the ability of future cash flows to fund future debt and preferred
obligations, and sugar industry conditions. The Company has no current plans to
divest or sell its investments in C&H.

   2001--The Company wrote off $4,823,000 for power generation equipment that
is being removed from service. This equipment was no longer needed in the
Company's cane sugar refining operations on Maui, due to changes in factory and
power generation processes.

   1999--The Company began growing coffee in Hawaii in 1987 as an alternative
crop to sugar cane. Since inception, the Company's coffee operation generated
operating losses and negative cash flows. During the second half of 1999, the
Company significantly reduced the coffee workforce and changed its coffee
marketing and selling plans. To exacerbate the problem, coffee commodity prices
dropped significantly in 1999, due to an oversupply of coffee in the
marketplace. Because of continuing cash-flow losses, the ongoing viability of
the coffee operation was evaluated again. As a result, the Company determined
that the estimated future cash flows of the coffee operation were less than the
carrying value of its productive assets, consisting mainly of orchards and
field and processing equipment. Accordingly, a $15,410,000 (pre-tax) charge was
recorded to write down these productive assets to their fair value (i.e.,
present value of estimated future cash flows).

                                      37

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5.  INVESTMENTS

   At December 31, 2001 and 2000, investments consisted principally of
marketable equity securities, equity in affiliated companies, limited
partnership interests and purchase-money mortgages, as follows:



                                                                   2001     2000
                                                                  ------- --------
                                                                   (in thousands)
                                                                    
Equity in Affiliated Companies:
    SSA Terminals, LLC (SSAT).................................... $16,033 $ 21,867
    C&H Sugar Company, Inc. (C&H)................................  11,504   41,705
    Sea Star Line, LLC (Sea Star)................................   1,854    7,586
    Other........................................................     300      300
Marketable Equity Securities.....................................      --  108,069
Limited Partnership Interests, Purchase-money Mortgages and Other   3,330    3,614
                                                                  ------- --------
Total Investments................................................ $33,021 $183,141
                                                                  ======= ========


   Marketable Equity Securities:   The marketable equity securities are
classified as "available for sale" and are stated at quoted market values as
traded on national exchanges. The unrealized holding gains on these securities
and the reclassification of gains previously included in Comprehensive Income,
net of deferred income taxes, have been recorded as a separate component of
Shareholders' Equity and are included in Comprehensive Income.

   In May, 2001, BNP Paribas SA, France's largest bank, announced that, subject
to regulatory, shareholder and other approvals, it would purchase the remaining
55 percent of BancWest Corporation ("BancWest") which it did not already own
for $35 per share. This offer was 40% higher than the market price of
BancWest's stock at the time of the offer. When the offer was made, the Company
owned 3,385,788 shares of BancWest. The transaction closed during the fourth
quarter of 2001. As a result of the sale, the Company received cash of
$118,503,000, recorded a pre-tax gain of $110,338,000, and recognized an
after-tax gain of approximately $68,410,000 ($1.69 per basic share.)

   During 2001, the Company also divested its holdings in Pacific Century
Financial Corporation ("Pacific Century"). This was completed through the
donation of 360,000 shares to the Company's charitable foundation and the sales
of 749,000 shares of the stock. The fair value of the donated stock was
approximately $7,500,000 and the historical cost basis was approximately
$500,000. The net expense related to this contribution was $500,000 and is
included in "Selling general and administrative expenses" in the 2001
consolidated financial statements. The Company received $16,219,000 for the
sales of the shares, recognized a pre-tax gain of $15,140,000 and recorded an
after-tax gain of $9,378,000 ($0.23 per basic share).

   The changes in the net unrealized holding gains (losses) for the three years
ended December 31, 2001 were as follows:



                                                   2001     2000     1999
                                                 --------  ------- --------
                                                       (in thousands)
                                                          
   Holding gains (losses) arising during year,
    net of deferred income tax.................. $ 15,851  $12,476 $(13,868)
   Reclassification of gains previously included
    in Comprehensive Income, net of income tax..  (77,788)      --       --
                                                 --------  ------- --------
   Total........................................ $(61,937) $12,476 $(13,868)
                                                 ========  ======= ========


   As described above, the marketable equity investments were divested during
2001. Accordingly there was no balance in unrealized holdings at year-end 2001.
The components of the net unrealized holding gains, as noted on the
Consolidated Balance Sheet at December 31, 2000, were as follows:



                                                    2000
                                               --------------
                                               (in thousands)
                                            
                  Market value................    $108,069
                  Less historical cost........       9,761
                                                  --------
                  Unrealized holding gains....      98,308
                  Less deferred income taxes..      36,371
                                                  --------
                  Net unrealized holding gains    $ 61,937
                                                  ========


                                      38

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   Equity in Affiliated Companies:  In 1998, the Company sold a majority
interest in C&H. Following the sale, the Company retained approximately 36
percent of the common stock, 40 percent of the junior preferred stock and all
of the senior preferred stock of C&H. Dividends on the senior and junior
preferred stocks are cumulative. Through December 2003, dividends on the senior
preferred stock may be paid either in cash or by issuance of additional shares
of senior preferred stock. C&H must redeem from the Company, at one thousand
dollars per share, the outstanding senior preferred stock in December 2009 and
outstanding junior preferred stock in December 2010. C&H was included in the
consolidated results of the Company up to the date of the sale. The Company
accounts for its investment in C&H under the equity method. See Note 4 for a
discussion of the 2001 impairment loss related to this investment which
resulted from an other than temporary decline in value. Financial information
for C&H as of and for the years ended December 31, 2001 and 2000 follows:

                           Condensed Balance Sheets


                                                           2001     2000
                                                         -------- --------
                                                          (in thousands)
                                                            
      Assets:
        Current......................................... $103,699 $125,735
        Property and other..............................  116,293  129,529
                                                         -------- --------
      Total............................................. $219,992 $255,264
                                                         ======== ========
      Liabilities and Shareholders' Equity:
        Current......................................... $ 35,030 $ 63,470
        Long-term debt and other........................  139,737  124,941
        Shareholders' equity, including preferred stock.   45,225   66,853
                                                         -------- --------
      Total............................................. $219,992 $255,264
                                                         ======== ========


                        Condensed Statements of Income


                                           2001      2000
                                         --------  --------
                                           (in thousands)
                                             

                      Revenue........... $427,350  $413,153
                      Cost and Expenses.  433,864   409,839
                                         --------  --------
                      Net (Loss) Income. $ (6,514) $  3,314
                                         ========  ========


   Matson, a wholly owned subsidiary of the Company, has a minority interest
investment in a limited liability corporation (LLC) with Saltchuk Resources,
Inc. and International Shipping Agency, Inc., named Sea Star Line, LLC, which
operates an ocean transportation service between Florida and Puerto Rico.
Matson has guaranteed obligations of $31,500,000 of this unconsolidated
affiliate and chartered two vessels to Sea Star Line, LLC. Subsequent to 2001
year-end, Matson sold the two vessels to Sea Star for an aggregate sales price
of $17,000,000, which was the approximate carrying value of the vessels at 2001
year end. This amount is included in "Real estate and other assets held for
sale" on the Consolidated Balance Sheet at December 31, 2001. This investment
represents a minority interest and is accounted for under the equity method.

   Matson is part owner of an LLC with Stevedoring Services of America, named
SSA Terminals, LLC, which provides stevedoring and terminal services at six
terminals in three West Coast ports to the Company and other shipping lines.
This investment represents a minority interest and is accounted for under the
equity method. During 1999, Matson contributed assets with a value of
$16,438,000 in connection with the formation of SSAT. The "Cost of
transportation services" included approximately $89,551,000, $99,151,000 and
$46,856,000, for 2001, 2000 and 1999, respectively, paid to this unconsolidated
affiliate for terminal services.

   The Company's equity in income (loss) of unconsolidated affiliates for the
three years ended December 31, 2001 was $(8,778,000), $6,859,000, and
$3,002,000, respectively.

   Limited Partnership Interests and Purchase-money Mortgages:  The investments
in limited partnerships are recorded at the lower of cost or fair value and
purchase-money mortgages are recorded at cost. The purchase-money mortgages are
intended to be held to maturity. The values of the investments in limited
partnerships are assessed annually.

                                      39

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   See Note 7 for a discussion of fair values of investments in the Capital
Construction Fund.

6.  PROPERTY

   Property on the Consolidated Balance Sheets includes the following:



                                                        2001       2000
                                                     ---------- ----------
                                                        (in thousands)
                                                          
      Vessels....................................... $  694,618 $  770,352
      Machinery and equipment.......................    545,298    534,894
      Buildings.....................................    317,068    271,314
      Land..........................................    104,135     95,195
      Water, power and sewer systems................     87,915     80,084
      Other property improvements...................     67,645     56,355
                                                     ---------- ----------
          Total.....................................  1,816,679  1,808,194
      Less accumulated depreciation and amortization    839,631    853,502
                                                     ---------- ----------
          Property--net............................. $  977,048 $  954,692
                                                     ========== ==========


7.  CAPITAL CONSTRUCTION FUND

   Matson is party to an agreement with the United States government which
established a Capital Construction Fund (CCF) under provisions of the Merchant
Marine Act, 1936, as amended. The agreement has program objectives for the
acquisition, construction or reconstruction of vessels and for repayment of
existing vessel indebtedness. Deposits to the CCF are limited by certain
applicable earnings. Such deposits are federal income tax deductions in the
year made; however, they are taxable, with interest payable from the year of
deposit, if withdrawn for general corporate purposes or other non-qualified
purposes, or upon termination of the agreement. Qualified withdrawals for
investment in vessels and certain related equipment do not give rise to a
current tax liability, but reduce the depreciable bases of the vessels or other
assets for income tax purposes.

   Amounts deposited into the CCF are a preference item for calculating federal
alternative minimum taxable income. Deposits not committed for qualified
purposes within 25 years from the date of deposit, will be treated as
non-qualified withdrawals over the subsequent five years. As of December 31,
2001, the oldest CCF deposits date from 1994. Management believes that all
amounts on deposit in the CCF at the end of 2001 will be used or committed for
qualified purposes prior to the expiration of the applicable 25-year periods.

   Under the terms of the CCF agreement, Matson may designate certain qualified
earnings as "accrued deposits" or may designate, as obligations of the CCF,
qualified withdrawals to reimburse qualified expenditures initially made with
operating funds. Such accrued deposits to and withdrawals from the CCF are
reflected on the Consolidated Balance Sheets either as obligations of the
Company's current assets or as receivables from the CCF.

   The Company has classified its investments in the CCF as "held-to-maturity"
and, accordingly, has not reflected temporary unrealized market gains and
losses on the Consolidated Balance Sheets or Consolidated Statements of
Income. The long-term nature of the CCF program supports the Company's
intention to hold these investments to maturity.

                                      40

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   At December 31, 2001 and 2000, the balances on deposit in the CCF are
summarized as follows:



                                       2001                           2000
                           ----------------------------- -----------------------------
                                                  (in thousands)
                           Amortized  Fair    Unrealized Amortized  Fair    Unrealized
                             Cost     Value      Gain      Cost     Value   Gain (Loss)
                           --------- -------- ---------- --------- -------- -----------
                                                          
Mortgage-backed securities $ 26,180  $ 26,983   $  803   $ 32,302  $ 32,281    $(21)
Cash and cash equivalents.  128,557   129,161      604    113,583   113,871     288
Accrued deposits..........    4,000     4,000       --      4,520     4,520      --
                           --------  --------   ------   --------  --------    ----
Total..................... $158,737  $160,144   $1,407   $150,405  $150,672    $267
                           ========  ========   ======   ========  ========    ====


   Fair value of the mortgage-backed securities was determined by an outside
investment management company, based on experience trading identical or
substantially similar securities. No central exchange exists for these
securities; they are traded over-the-counter. The Company earned $2,476,000 in
2001, $2,654,000 in 2000, and $3,152,000 in 1999 on its investments in
mortgage-backed securities. The fair values of other CCF investments are based
on quoted market prices. These other investments mature no later than January
9, 2004. One security classified as "held to maturity" was sold during 2001 for
a loss of $42,800. In 2000, three securities classified as "held-to-maturity"
were sold for a combined loss of $48,400. These securities no longer met
authorized credit requirements.

8.  NOTES PAYABLE AND LONG-TERM DEBT

   At December 31, 2001 and 2000, long-term debt consisted of the following:



                                                                       2001     2000
                                                                     -------- --------
                                                                      (in thousands)
                                                                        
Commercial paper, 2001 high 6.79%, low 1.88%........................ $ 99,878 $ 99,766
Bank variable rate loans, due after 2001, 2001 high 7.13%, low 2.17%   17,400  136,500
Term loans:
  7.38%, payable through 2007.......................................   45,000   52,500
  7.42%, payable through 2010.......................................   20,000   20,000
  7.43%, payable through 2007.......................................   15,000   15,000
  7.57%, payable through 2009.......................................   15,000   15,000
  7.55%, payable through 2009.......................................   15,000   15,000
  7.65%, payable through 2001.......................................       --    7,500
                                                                     -------- --------
Total...............................................................  227,278  361,266
Less current portion................................................   19,900   30,500
                                                                     -------- --------
Long-term debt...................................................... $207,378 $330,766
                                                                     ======== ========


   Commercial Paper:  At December 31, 2001, $99,878,000 of commercial paper
notes was outstanding under a commercial paper program used by a subsidiary to
finance the construction of a vessel. Maturities ranged from 6 to 56 days. The
borrowings outstanding under this program are classified as long-term because
the subsidiary intends to continue the program and, eventually, to repay the
borrowings with qualified withdrawals from the Capital Construction Fund.

   Variable Rate Loans:  The Company has a revolving credit and term loan
agreement with six commercial banks, whereby it may borrow up to $185,000,000
under revolving loans through November 2004, at market rates of interest. Any
revolving loan outstanding on that date may be converted into a term loan,
which would be payable in four equal quarterly installments. The agreement
contains certain restrictive covenants, the most significant of which requires
the maintenance of an interest coverage ratio of 2:1 and total debt to earnings
before interest, depreciation,
amortization and taxes of 3:1. At December 31, 2000, $113,500,000 was
outstanding under this agreement. No amount was drawn on this facility at
December 31, 2001.

   The Company has an uncommitted $70,000,000 short-term revolving credit
agreement with a commercial bank. The agreement extends through November 2002,
but may be canceled by the bank or the Company at any time. The

                                      41

<p Style="page-break-after:always">

amount which the Company may draw under the facility is reduced by the amount
drawn against the bank under the previously referenced $185,000,000 multi-bank
facility, in which it is a participant, and by letters of credit issued under
the $70,000,000 uncommitted facility. At December 31, 2001 and 2000, $5,000,000
and $7,500,000, respectively, were outstanding under this agreement. Under the
borrowing formula for this facility, the Company could have borrowed an
additional $59,477,000 at December 31, 2001.

   Matson has two revolving credit agreements totaling $90,000,000 with
commercial banks. The first facility is a $50,000,000 two-year revolving credit
agreement which expires in September 2003. At December 31, 2001, no amounts
were drawn on this facility. At December 31, 2000, $15,500,000 was outstanding.
The second facility is a two-year $40,000,000 revolving credit agreement which
was entered into during 2001 and which expires in January 2003. At December 31,
2001, $12,400,000 was drawn on this new facility.

   Matson also has a $25,000,000 one-year revolving credit agreement with a
commercial bank, expiring in November 2002, which serves as a commercial paper
liquidity back-up line. At December 31, 2001 and 2000, no amounts were
outstanding under this agreement.

   Other Debt Agreements:  During 2001, the Company completed a private shelf
agreement for $50,000,000, which expires in April 2004. At December 31, 2001,
no amount had been drawn on this facility. Also in 2001, Matson entered into a
$50,000,000 private shelf offering which expires in June 2004. No amounts were
drawn on that facility at year end. An uncommitted $25,000,000 revolving credit
agreement with a commercial bank expired in May 2001.

   Long-term Debt Maturities:  At December 31, 2001, maturities and planned
prepayments of all long-term debt during the next five years are $19,900,000
for 2002, $9,643,000 for 2003, $12,500,000 for 2004, $17,500,000 for 2005 and
$17,500,000 for 2006.

   Interest Rate Risk:  The Company is exposed to changes in U.S. interest
rates, primarily as a result of its borrowing and investing activities used to
maintain liquidity and to fund business operations. In order to manage its
exposure to changes in interest rates, the Company utilizes a balanced mix of
debt maturities, along with both fixed-rate and variable-rate debt. The Company
does not hedge its interest rate exposure. The nature and amount of the
Company's long-term and short-term debt can be expected to fluctuate as a
result of future business requirements, market conditions and other factors.
The following table summarizes the Company's debt obligations at December 31,
2001, presenting principal cash flows and related interest rates by expected
fiscal year of maturity. Variable interest rates represent the weighted-average
rates of the portfolio at December 31, 2001. The Company estimates that the
carrying value of its debt is not materially different from its fair value.



                           Expected Fiscal Year of Maturity at December 31, 2001
                      ---------------------------------------------------------------
                       2002     2003    2004     2005     2006    Thereafter  Total
                      -------  ------  -------  -------  -------  ---------- --------
                                          (dollars in thousands)
                                                        
Fixed rate........... $ 7,500  $9,643  $12,500  $17,500  $17,500   $ 45,357  $110,000
Average interest rate    7.17%   7.33%    7.38%    7.42%    7.45%      7.49%       --
Variable rate........ $12,400      --       --       --       --   $104,878  $117,278
Average interest rate    2.20%     --       --       --       --       2.04%       --


9.  LEASES

   The Company as Lessee:  Principal operating leases include land, office and
terminal facilities, containers and equipment, leased for periods which expire
between 2003 and 2052. Management expects that, in the normal course of
business, most operating leases will be renewed or replaced by other similar
leases.

   Rental expense under operating leases totaled $19,748,000, $19,741,000, and
$28,343,000 for the years ended December 31, 2001, 2000, and 1999, respectively.

                                      42

<p Style="page-break-after:always">

   Future minimum payments under operating leases as of December 31, 2001 were
as follows:



                                                 Operating
                                                   Leases
                                               --------------
                                               (in thousands)
                                            
                  2002........................    $ 12,843
                  2003........................      12,699
                  2004........................      12,556
                  2005........................       8,848
                  2006........................       7,814
                  Thereafter..................      91,761
                                                  --------
                  Total minimum lease payments    $146,521
                                                  ========


   The Company is obligated to pay terminal facility rent equal to the
principal and interest on Special Facility Revenue Bonds issued by the
Department of Transportation of the State of Hawaii. Interest on the bonds is
payable semi-annually and principal, in the amount of $16,500,000, is due in
2013. An accrued liability of $10,431,000 and $9,887,000 at December 31, 2001
and 2000, respectively, included in other long-term liabilities, provides for a
pro-rata portion of the principal due on these bonds.

   The Company as Lessor:  The Company leases land, buildings, land
improvements, and five vessels under operating leases. Two of the vessels were
chartered to an unconsolidated affiliate and were sold to that affiliate in
January 2002 (see Note 5). The historical cost of and accumulated depreciation
on leased property at December 31, 2001 and 2000 were as follows:



                                                    2001     2000
                                                  -------- --------
                                                   (in thousands)
                                                     
             Leased property..................... $653,200 $621,860
             Less accumulated amortization.......  173,269  154,467
                                                  -------- --------
             Property under operating leases--net $479,931 $467,393
                                                  ======== ========


   Total rental income under these operating leases for the three years ended
December 31, 2001 was as follows:



                                                   2001     2000    1999
                                                 -------- -------- -------
                                                      (in thousands)
                                                          
      Minimum rentals........................... $105,251 $ 98,607 $93,275
      Contingent rentals (based on sales volume)    2,481    1,917   1,244
                                                 -------- -------- -------
      Total..................................... $107,732 $100,524 $94,519
                                                 ======== ======== =======


   Future minimum rental income on non-cancelable leases at December 31, 2001
was as follows:



                                        Operating
                                          Leases
                                      --------------
                                      (in thousands)
                                   
                           2002......    $ 96,807
                           2003......      90,028
                           2004......      81,757
                           2005......      75,112
                           2006......      26,586
                           Thereafter     151,375
                                         --------
                           Total.....    $521,665
                                         ========


                                      43

<p Style="page-break-after:always">

10.  EMPLOYEE BENEFIT PLANS

   The Company has funded single-employer defined benefit pension plans which
cover substantially all non-bargaining unit employees.

   In addition, the Company has plans that provide certain retiree health care
and life insurance benefits to substantially all salaried and to certain hourly
employees. Employees are generally eligible for such benefits upon retirement
and completion of a specified number of years of credited service. The Company
does not pre-fund these benefits and has the right to modify or terminate
certain of these plans in the future. Certain groups of retirees pay a portion
of the benefit costs.

   The status of the funded defined benefit pension plans and the unfunded
accumulated post-retirement benefit plans, at December 31, 2001, 2000, and 1999
is shown in the table on page 46.

   The net periodic benefit cost for the defined benefit pension plans and the
post-retirement health care and life insurance benefit plans during 2001, 2000,
and 1999 is summarized in the table on page 46.

   The assumptions used to determine the benefit information were as follows:



                                                          Other Post-retirement
                                     Pension Benefits            Benefits
                                     ----------------     ---------------------
                                     2001  2000  1999       2001  2000  1999
                                     ----  ----  ----       ----  ----  ----
                                                      
      Discount rate................. 7.25% 7.75% 7.75%      7.25% 7.75% 7.75%
      Expected return on plan assets 9.00% 9.00% 9.00%       --    --    --
      Rate of compensation increase. 4.25% 4.25% 4.25%      4.25% 4.25% 4.25%


   For the 2001 post-retirement benefit measurement purposes, a ten percent
annual rate of increase in the per capita cost of covered health care benefits
was assumed through 2001. The rate was assumed to decrease by one percent per
year through 2005 and then remain at five percent thereafter. For the 2000
measurement purposes, a ten percent annual rate of increase was assumed through
2001, after which a constant five percent rate was assumed. Unrecognized gains
and losses of the post-retirement benefit plans are amortized over five years.

   If the assumed health care cost trend rate were increased or decreased by
one percentage point, the accumulated post-retirement benefit obligation, as of
December 31, 2001, 2000, and 1999 and the net periodic post-retirement benefit
cost for 2001, 2000 and 1999, would have increased or decreased as follows:



                                                                Other Post-retirement Benefits
                                                                     One Percentage Point
                                                        ----------------------------------------------
                                                              Increase                Decrease
                                                        -------------------- -------------------------
                                                         2001   2000   1999   2001     2000     1999
                                                        ------ ------ ------ -------  -------  -------
                                                                        (in thousands)
                                                                             
Effect on total of service and interest cost components $  296 $  196 $  416 $  (244) $  (226) $  (347)
Effect on post-retirement benefit obligation........... $3,856 $1,664 $4,062 $(3,199) $(2,278) $(3,388)


   The assets of the defined benefit pension plans consist principally of
listed stocks and bonds. Contributions are determined annually for each plan by
the Company's pension administrative committee, based upon the actuarially
determined minimum required contribution under the Employee Retirement Income
Security Act of 1974 (ERISA), as amended, and the maximum deductible
contribution allowed for tax purposes. For the plans covering employees who are
members of collective bargaining units, the benefit formulas are determined
according to the collective bargaining agreements, either using career average
pay as the base or a flat dollar amount per year of service. The benefit
formulas for the remaining defined benefit plans are based on final average pay.

   The Company has non-qualified supplemental pension plans covering certain
employees and retirees, which provide for incremental pension payments from the
Company's general funds, so that total pension benefits would be substantially
equal to amounts that would have been payable from the Company's qualified
pension plans if it were

                                      44

<p Style="page-break-after:always">

not for limitations imposed by income tax regulations. The obligation, included
with other non-current liabilities, relating to these unfunded plans, totaled
$13,807,000 and $12,597,000 at December 31, 2001 and 2000, respectively.

   Total contributions to the multi-employer pension plans covering personnel
in shoreside and seagoing bargaining units were $4,028,000 in 2001, $3,027,000
in 2000, and $4,367,000 in 1999. Union collective bargaining agreements provide
that total employer contributions during the terms of the agreements must be
sufficient to meet the normal costs and amortization payments required to be
funded during those periods. Contributions are generally based on union labor
paid or cargo volume. A portion of such contributions is for unfunded accrued
actuarial liabilities of the plans being funded over periods of 25 to 40 years,
which began between 1967 and 1976.

   The multi-employer plans are subject to the plan termination insurance
provisions of ERISA and are paying premiums to the Pension Benefit Guarantee
Corporation (PBGC). The statutes provide that an employer who withdraws from,
or significantly reduces its contribution obligation to, a multi-employer plan
generally will be required to continue funding its proportional share of the
plan's unfunded vested benefits.

   Under special rules approved by the PBGC and adopted by the Pacific Coast
longshore plan in 1984, the Company could cease Pacific Coast cargo-handling
operations permanently and stop contributing to the plan without any withdrawal
liability, provided that the plan meets certain funding obligations as defined
in the plan. The estimated withdrawal liabilities under the Hawaii longshore
plan and the seagoing plans aggregated approximately $2,465,000 as of December
31, 2001, based on estimates by plan actuaries. Management has no present
intention of withdrawing from and does not anticipate termination of any of the
aforementioned plans.

                                      45

<p Style="page-break-after:always">



                                                       Pension Benefits         Other Post-retirement Benefits
                                               -------------------------------  -----------------------------
                                                 2001       2000       1999       2001       2000      1999
                                               ---------  ---------  ---------  --------   --------  --------
                                                                       (in thousands)
                                                                                   
Change in Benefit Obligation
Benefit obligations at beginning of year...... $ 235,000  $ 218,189  $ 229,573  $ 37,910   $ 47,836  $ 55,298
Service cost..................................     4,844      4,877      5,705       443        504       892
Interest cost.................................    17,549     16,882     15,013     2,720      2,939     3,460
Plan participants' contributions..............        --         --         --     1,137      1,165     1,423
Actuarial (gain) loss.........................    13,130     (2,016)   (25,177)    2,314     (2,652)   (8,198)
Benefits paid.................................   (14,094)   (13,146)   (12,109)   (3,452)    (3,635)   (4,320)
Amendments....................................       498      1,137     10,129        --         --        --
Settlements...................................        --      8,602     (1,304)       --     (8,247)       --
Curtailments..................................        --         --     (3,823)       --         --      (719)
Special or contractual termination benefits...        --        475        182        --         --        --
                                               ---------  ---------  ---------  --------   --------  --------
Benefit obligation at end of year.............   256,927    235,000    218,189    41,072     37,910    47,836
                                               ---------  ---------  ---------  --------   --------  --------
Change in Plan Assets
Fair value of plan assets at beginning of year   364,299    381,090    338,267        --         --        --
Actual return on plan assets..................   (35,747)    (3,645)    56,236        --         --        --
Settlements...................................        --         --     (1,304)       --         --        --
Employer contribution.........................       135         --         --        --         --        --
Benefits paid.................................   (14,094)   (13,146)   (12,109)       --         --        --
                                               ---------  ---------  ---------  --------   --------  --------
Fair value of plan assets at end of year......   314,593    364,299    381,090        --         --        --
                                               ---------  ---------  ---------  --------   --------  --------
Accrued Asset (Obligation)
Plan assets less benefit obligation...........    57,666    129,299    162,901   (41,072)   (37,910)  (47,836)
Unrecognized net actuarial gain...............    (4,963)   (91,307)  (135,670)   (4,232)    (9,134)  (15,841)
Unrecognized transition asset.................        --        (63)      (183)       --         --        --
Unrecognized prior service cost...............    10,597     12,547     13,939        72         79        32
                                               ---------  ---------  ---------  --------   --------  --------
Accrued asset (obligation).................... $  63,300  $  50,476  $  40,987  $(45,232)  $(46,965) $(63,645)
                                               =========  =========  =========  ========   ========  ========
Components of Net Periodic
 Benefit Cost/(Income)
Service cost.................................. $   4,844  $   4,877  $   5,705  $    443   $    504  $    892
Interest cost.................................    17,549     16,882     15,013     2,720      2,939     3,460
Expected return on plan assets................   (32,107)   (33,651)   (29,922)       --         --        --
Recognition of net gain.......................    (5,360)    (9,083)    (4,251)   (2,522)    (2,872)   (2,644)
Amortization of prior service cost............     2,448      2,528        905         7          7         8
Amortization of unrecognized transition asset.       (63)      (119)      (713)       --         --        --
Recognition of settlement (gain)/loss.........        --      8,602        (53)       --    (14,800)       --
Recognition of curtailment gain...............        --         --     (3,641)       --         --      (292)
                                               ---------  ---------  ---------  --------   --------  --------
Net periodic benefit cost/(income)............ $ (12,689) $  (9,964) $ (16,957) $    648   $(14,222) $  1,424
                                               =========  =========  =========  ========   ========  ========
Cost of termination benefits recognized....... $      --  $     475  $     182  $     --   $     --  $     --
                                               =========  =========  =========  ========   ========  ========


                                      46

<p Style="page-break-after:always">

11.  INCOME TAXES

   The income tax expense for the three years ended December 31, 2001 consisted
of the following:



                                      2001     2000    1999
                                     -------  ------- -------
                                          (in thousands)
                                             
                  Current:
                    Federal......... $65,881  $26,186 $21,035
                    State...........   8,900      847   3,461
                                     -------  ------- -------
                  Current...........  74,781   27,033  24,496
                  Deferred..........  (7,389)  17,358   8,465
                                     -------  ------- -------
                  Income tax expense $67,392  $44,391 $32,961
                                     =======  ======= =======


   Income tax expense for the three years ended December 31, 2001 differs from
amounts computed by applying the statutory federal rate to pre-tax income, for
the following reasons:



                                                    2001     2000     1999
                                                   -------  -------  -------
                                                         (in thousands)
                                                            
  Computed federal income tax expense............. $65,522  $42,950  $33,439
  State tax on income, less applicable federal tax   5,285    2,968    3,790
  Low-income housing credits......................    (859)  (1,124)  (1,161)
  Dividend exclusion..............................    (867)    (954)    (860)
  Prior years' tax settlement.....................      --       --   (2,815)
  Fair market value over cost of donations........  (1,481)      --       --
  Other--net......................................    (208)     551      568
                                                   -------  -------  -------
  Income tax expense.............................. $67,392  $44,391  $32,961
                                                   =======  =======  =======


   The tax effects of temporary differences that give rise to significant
portions of the net deferred tax liability at December 31, 2001 and 2000 were
as follows:



                                                        2001      2000
                                                      --------  --------
                                                        (in thousands)
                                                          
       Property basis and depreciation............... $166,810  $180,895
       Tax-deferred gains on real estate transactions  106,993   104,033
       Capital Construction Fund.....................   61,998    58,704
       Unrealized holding gains on securities........       --    36,371
       Pensions......................................   24,720    19,447
       Post-retirement benefits......................  (17,331)  (17,900)
       Insurance reserves............................   (9,301)  (10,740)
       Other--net....................................   (4,504)    3,143
                                                      --------  --------
       Total......................................... $329,385  $373,953
                                                      ========  ========


   The Internal Revenue Service (IRS) completed its examination of the
Company's tax returns through 1997. The IRS is currently auditing the Company's
tax returns for 1998 and 1999. Management believes that the outcome of the
current audit will not have a material effect on the Company's financial
position or results of operations.

12.  STOCK OPTIONS

   Employee Stock Option Plans:  The Company has two stock option plans under
which key employees are granted options to purchase shares of the Company's
common stock. There are no longer any outstanding options under a third plan,
which terminated in 1993.

                                      47

<p Style="page-break-after:always">

   Adopted in 1998, the Company's 1998 Stock Option/Stock Incentive Plan ("1998
Plan") provides for the issuance of non-qualified stock options to employees of
the Company. Under the 1998 Plan, option prices may not be less than the fair
market value of the Company's common stock on the dates of grant, the options
become exercisable over periods determined, at the dates of grant, by the
committee that administers the plan (generally ratably over three years), and
the options generally expire ten years from the date of grant. Payments for
options exercised may be made in cash or in shares of the Company's stock. If
an option to purchase shares is exercised within five years of the date of
grant and if payment is made in shares of the Company's stock, the option
holder may receive, under a reload feature, a new stock option grant for such
number of shares as is equal to the number surrendered, with an option price
not less than the greater of the fair market value of the Company's stock on
the date of exercise or one and one-half times the original option price.

   Adopted in 1989, the Company's 1989 Stock Option/Stock Incentive Plan ("1989
Plan") is substantially the same as the 1998 Plan, except that each option is
generally exercisable in-full one year after the date granted. The 1989 Plan
terminated in January 1999, but options granted through 1998 remain exercisable.

   The 1998 and 1989 Plans also permit the issuance of shares of the Company's
common stock as a reward for past service rendered to the Company or one of its
subsidiaries or as an incentive for future service with such entities. The
recipients' interest in such shares may be vested fully upon issuance or may
vest in one or more installments, upon such terms and conditions as are
determined by the committee which administers the plans. The number of
incentive shares issued during 2001 or outstanding at the end of the year was
not material.

   Director Stock Option Plans:  The Company has two Directors' stock option
plans. Under the 1998 Non-Employee Director Stock Option Plan ("1998 Directors'
Plan"), each non-employee Director of the Company, elected at an Annual Meeting
of Shareholders, is automatically granted, on the date of each such Annual
Meeting, an option to purchase 3,000 shares of the Company's common stock at
the fair market value of the shares on the date of grant. Each option to
purchase shares becomes exercisable in three successive annual installments of
1,000 shares beginning one year after the date granted.

   The 1989 Non-Employee Directors Stock Option Plan ("1989 Directors' Plan")
is substantially the same as the 1998 Directors' Plan, except that each option
generally becomes exercisable in-full one year after the date granted. This
plan terminated in January 1999, but options granted through termination remain
exercisable.

   Changes in shares and the weighted average exercise prices for the three
years ended December 31, 2001, were as follows:


                      Employee Plans      Directors' Plans
                    ------------------  --------------------         Weighted
                                           1998       1989           Average
                    1998   1989   1983  Directors' Directors' Total  Exercise
                    Plan   Plan   Plan     Plan       Plan    Shares  Price
                    -----  -----  ----  ---------- ---------- ------ --------
                                 (shares in thousands)
                                                
  December 31, 1998   100  3,263   161       -        204     3,728   $26.69
  Granted..........   515      -     -      24          -       539   $20.65
  Exercised........     -     (4)    -       -          -        (4)  $22.02
  Canceled.........    (2)  (373) (161)      -        (15)     (551)  $29.16
                    -----  -----  ----      --        ---     -----   ------
  December 31, 1999   613  2,886     -      24        189     3,712   $25.43
  Granted..........   511      -     -      24          -       535   $21.70
  Exercised........    (7)  (139)    -       -          -      (146)  $23.79
  Canceled.........   (31)  (340)    -       -        (21)     (392)  $29.49
                    -----  -----  ----      --        ---     -----   ------
  December 31, 2000 1,086  2,407     -      48        168     3,709   $24.52
  Granted..........   590      -     -      24          -       614   $27.23
  Exercised........   (35)  (244)    -       -          -      (279)  $23.53
  Canceled.........   (14)   (21)    -       -        (21)      (56)  $25.81
                    -----  -----  ----      --        ---     -----   ------
  December 31, 2001 1,627  2,142     -      72        147     3,988   $24.99
                    -----  -----  ----      --        ---     -----   ------
  Exercisable......   550  2,142     -      24        147     2,863   $25.19
                    -----  -----  ----      --        ---     -----   ------


                                      48

<p Style="page-break-after:always">

   As of December 31, 2001, the Company had reserved 431,000 and 58,000 shares
of its common stock for the exercise of options under the 1998 Plan and 1998
Directors' Plan, respectively. Additional information about stock options
outstanding as of 2001 year-end is summarized below:



                                     Weighted                         Weighted
                          Shares      Average   Weighted   Shares      Average
                        Outstanding  Remaining  Average  Exercisable  Price of
                           as of    Contractual Exercise    as of    Exercisable
Range of Exercise Price 12/31/2001     Years     Price   12/31/2001    Options
- ----------------------- ----------- ----------- -------- ----------- -----------
                                         (shares in thousands)
                                                      
    $0.00..............       16        9.1      $ 0.00        --          --
    $20.01 - 22.00.....    1,170        6.3      $21.31       682      $21.31
    $22.01 - 24.00.....      445        4.3      $23.07       360      $23.05
    $24.01 - 26.00.....      382        1.6      $24.37       378      $24.36
    $26.01 - 28.00.....    1,025        3.3      $27.05     1,025      $27.05
    $28.01 - 30.00.....      852        5.7      $28.33       320      $28.35
    $30.01 - 34.88.....       98        0.8      $33.51        98      $33.51
                           -----        ---      ------     -----      ------
    $ 0.00 - 34.88.....    3,988        4.7      $24.99     2,863      $25.19
                           -----        ---      ------     -----      ------


   Accounting Method for Stock-based Compensation:  The Company applies
Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to
Employees," and related Interpretations, to account for its stock-based
compensation plans. Accordingly, no compensation cost is recognized in the
Company's income statement for stock option plans at the time grants are
awarded. Pro forma information regarding net income and earnings per share is
required, using the fair value method, by SFAS No. 123, "Accounting for
Stock-based Compensation."

   The fair value of options granted for each of the three years ended December
31, 2001, reported below, has been estimated using a Black-Scholes option
pricing model. This model was developed for use in estimating the fair value of
traded options which do not have vesting requirements and which are fully
transferable. The Company's options have characteristics significantly
different from those of traded options. The following assumptions were used in
determining the pro forma amounts:



                                                    2001  2000  1999
                                                    ----  ----  ----
                                                       
           Stock volatility........................ 25.2% 25.0% 24.8%
           Expected term from grant date (in years)  6.2   6.7   6.5
           Risk-free interest rate.................  4.5%  6.0%  5.0%
           Forfeiture discount.....................  2.6%  0.3%  0.2%
           Dividend yield..........................  3.3%  3.4%  4.0%


   Based upon the above assumptions, the computed annual weighted average fair
value of employee stock options granted during 2001, 2000, and 1999 was $6.22,
$5.54, and $4.63, respectively, per option.

   Had compensation cost for the stock options granted during the past three
years been based on the estimated fair value at grant dates, as prescribed by
SFAS No. 123, the Company's pro forma net income and net income per share would
have been as follows:



                                    2001          2000         1999
                                  --------      -------      -------
                               (in thousands, except per share amounts)
                                                  
         Net Income:
          As reported.........    $110,628      $90,574      $62,579
          Pro forma...........    $108,848      $89,060      $61,108
         Net Income Per Share:
          Basic, as reported..    $   2.73      $  2.21      $  1.45
          Basic, pro forma....    $   2.69      $  2.18      $  1.41
          Diluted, as reported    $   2.72      $  2.21      $  1.45
          Diluted, pro forma..    $   2.67      $  2.17      $  1.42


                                      49

<p Style="page-break-after:always">

   The pro forma disclosures of net income and earnings per share are not
likely to be representative of the pro forma effects on future net income or
earnings per share, because the number of future shares which may be issued is
not known, shares vest over several years, and assumptions used to determine
the fair value can vary significantly.

   Shareholder Rights Plan:  The Company has a Shareholder Rights Plan,
designed to protect the interests of shareholders in the event an attempt is
made to acquire the Company. The rights initially will trade with the Company's
outstanding common stock and will not be exercisable absent certain
acquisitions or attempted acquisitions of specified percentages of such stock.
If exercisable, the rights generally entitle shareholders (other than the
acquiring party) to purchase additional shares of the Company's stock or shares
of an acquiring company's stock at prices below market value.

13.  RELATED PARTY TRANSACTIONS, COMMITMENTS AND CONTINGENCIES

   At December 31, 2001, the Company and its subsidiaries had an unspent
balance of total appropriations for capital expenditures of approximately
$77,633,000. However, there are no contractual obligations to spend this entire
amount.

   The Company has arranged for standby letters of credit totaling $26,019,000.
This includes letters of credit, totaling approximately $13,959,000, which
enable the Company to qualify as a self-insurer for state and federal workers'
compensation liabilities. The amount also includes a letter of credit of
$6,112,000 for workers' compensation claims incurred by C&H employees, under a
now-closed self-insurance plan, prior to December 24, 1998 (see Note 5). The
Company only would be called upon to honor this letter of credit in the event
of C&H's insolvency. The obligation to provide this letter of credit expires on
December 24, 2003. The remaining letters of credit are for insurance-related
matters, construction performance guarantees and other routine operating
matters.

   C&H is a party to a sugar supply contract with Hawaiian Sugar &
Transportation Cooperative (HS&TC), a raw sugar marketing and transportation
cooperative that the Company uses to market and transport its sugar to C&H.
Under the terms of this contract, which expires in June 2003, C&H (an
unconsolidated entity in which the Company has a minority ownership equity
interest--see Notes 4 and 5) is obligated to purchase, and HS&TC is obligated
to sell, all of the raw sugar delivered to HS&TC by the Hawaii sugar growers,
at prices determined by the quoted domestic sugar market. The Company delivered
to HS&TC raw sugar totaling $70,149,000, $64,455,000, and $83,412,000, during
2001, 2000, and 1999, respectively. The Company has guaranteed up to
$15,000,000 of HS&TC's $30,000,000 working capital line. The facility is fully
collateralized by raw-sugar inventory. At December 31, 2001, HS&TC had borrowed
$2,500,000 under that facility.

   The State of Hawaii, Department of Taxation (State) has informed the
Company that it believes a portion of the Company's ocean transportation
revenue is subject to the Public Service Company tax. The Company strongly
disagrees with the State's tax position. If the State were to prevail fully,
the amount of the claim could be material. Management believes, after
consultation with legal counsel, that the ultimate disposition of this matter
will not have a material adverse effect on the Company's results of operations
or financial position.

   Note 5 contains additional information about transactions with
unconsolidated affiliates, which affiliates are also related parties, due to
the Company's minority interest investments.

   The Company and certain subsidiaries are parties to various legal actions
and are contingently liable in connection with claims and contracts arising in
the normal course of business, the outcome of which, in the opinion of
management after consultation with legal counsel, will not have a material
adverse effect on the Company's financial position or results of operations.

14.  INDUSTRY SEGMENTS

   Operating segments are defined as components of an enterprise about which
separate financial information is available that is evaluated regularly by the
chief operating decision maker, or decision-making group, in deciding how to
allocate resources and in assessing performance. The Company's chief operating
decision-making group is

                                      50

<p Style="page-break-after:always">

made up of the president and lead executives of the Company and each of the
Company's segments. The lead executive for each operating segment manages the
profitability, cash flows and assets of his or her respective segment's various
product or service lines and businesses. The operating segments are managed
separately, because each operating segment represents a strategic business unit
that offers different products or services and serves different markets.

   The Company's reportable operating segments include Ocean Transportation,
Property Development and Management and Food Products. The Ocean Transportation
segment carries freight between various United States West Coast, Hawaii and
other Pacific ports; holds investments in ocean transportation and terminal
service businesses (see Note 5); and provides terminal and cargo logistics
services. The Property Development and Management segment develops, manages and
sells residential, commercial and industrial properties. The Food Products
segment grows and processes raw sugar and molasses; invests in a sugar refining
and marketing business (see Note 5); grows, mills and markets coffee; and
generates and sells electricity.

   The accounting policies of the operating segments are the same as those
described in the summary of significant policies. Reportable segments are
measured based on operating profit, exclusive of non-operating or unusual
transactions, interest expense, general corporate expenses and income taxes.


                                      51

<p Style="page-break-after:always">

   Industry segment information for each of the five years ended December 31,
2001 is summarized below:



                                                                                For the Year
                                                         ----------------------------------------------------------
                                                            2001        2000        1999        1998        1997
                                                         ----------  ----------  ----------  ----------  ----------
                                                                               (in thousands)
                                                                                          
Revenue:
  Ocean transportation.................................. $  796,840  $  850,692  $  778,535  $  748,121  $  720,962
  Property development and management:
    Leasing.............................................     70,685      62,105      53,910      44,433      43,606
    Sales...............................................     89,156      46,322      48,036      82,382      35,916
  Food products.........................................    104,376     106,341     116,362     465,661     486,912
  Other.................................................    129,016       3,186       3,155       2,878       2,815
                                                         ----------  ----------  ----------  ----------  ----------
     Total revenue...................................... $1,190,073  $1,068,646  $  999,998  $1,343,475  $1,290,211
                                                         ==========  ==========  ==========  ==========  ==========
Operating Profit:
  Ocean transportation.................................. $   62,264  $   93,732  $   83,778  $   66,298  $   80,385
  Property development and management:
    Leasing.............................................     34,139      30,120      27,497      22,634      24,559
    Sales...............................................     17,926      24,228      17,402      21,663      13,262
  Food products.........................................      5,660       7,522      11,310      21,327      27,083
  Other.................................................    127,635       2,974       2,944       2,696       2,639
                                                         ----------  ----------  ----------  ----------  ----------
     Total operating profit.............................    247,624     158,576     142,931     134,618     147,928
  Write-down of long-lived assets.......................    (28,600)         --     (15,410)    (20,216)         --
  Loss on partial sale of subsidiary....................         --          --          --     (19,756)         --
  Insurance settlement..................................         --          --          --          --      19,965
  Interest expense, net.................................    (18,658)    (24,252)    (17,774)    (24,799)    (28,936)
  General corporate expenses............................    (13,161)    (11,609)    (14,207)    (14,552)    (11,745)
                                                         ----------  ----------  ----------  ----------  ----------
     Income from continuing operations before income
      taxes and accounting changes...................... $  187,205  $  122,715  $   95,540  $   55,295  $  127,212
                                                         ==========  ==========  ==========  ==========  ==========
Identifiable Assets:
  Ocean transportation.................................. $  888,161  $  911,109  $  894,607  $  898,277  $  930,636
  Property development and management...................    476,126     440,416     384,515     338,090     317,622
  Food products.........................................    139,695     197,143     173,069     261,712     382,109
  Other.................................................     40,437     117,344     109,269     107,561      74,431
                                                         ----------  ----------  ----------  ----------  ----------
     Total assets....................................... $1,544,419  $1,666,012  $1,561,460  $1,605,640  $1,704,798
                                                         ==========  ==========  ==========  ==========  ==========
Capital Expenditures:
  Ocean transportation.................................. $   59,669  $   40,190  $   19,232  $   60,403  $   20,828
  Property development and management/1/................     72,050      44,821      66,752     107,408      30,790
  Food products.........................................      9,454      21,677      17,271      18,237      18,806
  Other.................................................        267         216         258         441         242
                                                         ----------  ----------  ----------  ----------  ----------
     Total capital expenditures......................... $  141,440  $  106,904  $  103,513  $  186,489  $   70,666
                                                         ==========  ==========  ==========  ==========  ==========
Depreciation and Amortization:
  Ocean transportation.................................. $   55,359  $   54,586  $   56,174  $   61,543  $   62,192
  Property development and management...................     10,486       8,972       7,299       6,357       6,281
 Food products..........................................      9,118       8,285       9,962      20,086      19,538
 Other..................................................        470         461         466         514         547
                                                         ----------  ----------  ----------  ----------  ----------
     Total depreciation and amortization................ $   75,433  $   72,304  $   73,901  $   88,500  $   88,558
                                                         ==========  ==========  ==========  ==========  ==========

- --------
See Note 2 for information regarding changes in presentation for certain
revenues and expenses.
See Note 3 for information regarding discontinued operations.
See Note 4 for discussion of the write-down of long-lived assets and
investments.
See Note 5 for discussion of the partial sale of California and Hawaiian Sugar
Company, Inc.

/1/ Includes tax-deferred property purchases which are considered non-cash
    transactions in the Consolidated Statements of Cash Flows; excludes capital
    expenditures for real estate developments held for sale.

                                      52

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15.  QUARTERLY INFORMATION (Unaudited)

   Segment results by quarter for 2001 are listed below:



                                                                        2001
                                                      ---------------------------------------
                                                         Q1         Q2        Q3        Q4
                                                      --------   --------  --------  --------
                                                      (in thousands, except per-share amounts)
                                                                         
Revenue:
  Ocean transportation............................... $196,609   $203,212  $207,828  $189,191
  Property development and management:...............
    Leasing..........................................   17,096     17,490    18,103    17,996
    Sales............................................   43,084     29,155     5,063    11,854
  Food products......................................   18,185     28,076    32,268    25,847
  Other..............................................      857     16,188       803   111,168
                                                      --------   --------  --------  --------
    Total revenue.................................... $275,831   $294,121  $264,065  $356,056
                                                      ========   ========  ========  ========
Operating Profit (Loss):
  Ocean transportation............................... $ 17,455   $ 18,713  $ 24,245  $  1,851
  Property development and management:
    Leasing..........................................    8,740      8,679     8,704     8,016
    Sales............................................   12,216      3,551      (405)    2,564
  Food products/1/...................................    5,802      1,509     2,235    (3,886)
  Other..............................................      840     16,107       767   109,921
                                                      --------   --------  --------  --------
    Total operating profit...........................   45,053     48,559    35,546   118,466
Impairment loss on Investments/1/....................       --         --        --   (28,600)
Interest Expense.....................................   (5,779)    (4,870)   (4,330)   (3,679)
General Corporate Expenses...........................   (3,791)    (3,191)   (2,878)   (3,301)
                                                      --------   --------  --------  --------
Income From Continuing Operations before Income Taxes   35,483     40,498    28,338    82,886
  Income taxes.......................................  (12,603)   (15,496)  (10,475)  (28,818)
                                                      --------   --------  --------  --------
Income From Continuing Operations....................   22,880     25,002    17,863    54,068
Discontinued Operations (net of income taxes)/2/.....     (446)      (488)     (551)   (7,700)
                                                      --------   --------  --------  --------
Net Income........................................... $ 22,434   $ 24,514  $ 17,312  $ 46,368
                                                      ========   ========  ========  ========
Earnings Per Share:
  Basic.............................................. $   0.55   $   0.61  $   0.42  $   1.15
  Diluted............................................ $   0.55   $   0.60  $   0.42  $   1.15


/1/ See Note 4 for discussion of the write-down of the Company's investment in
    C&H and certain power equipment.
/2/ See Note 3 for discussion of discontinued operations.

   Fourth quarter 2001 results include the sale of the Company's BancWest stock
holdings (see Note 5; amount included in the "Other" segment), the impairment
loss related to the Company's investment in C&H (see Note 4) and a write-off of
power generation assets (see Note 4). In addition, the Company discontinued and
abandoned its panelboard business and restated previously reported quarters
(see Notes 2 and 3).

                                      53

<p Style="page-break-after:always">

   Segment results by quarter for 2000 are listed below:



                                                                                        2000
                                                                      ---------------------------------------
                                                                         Q1         Q2        Q3        Q4
                                                                      --------   --------  --------  --------
                                                                      (in thousands, except per-share amounts)
                                                                                         
Revenue:.............................................................
    Ocean transportation/1/.......................................... $200,225   $213,584  $220,759  $216,124
    Property development and management:
       Leasing/1/....................................................   14,518     15,287    15,522    16,778
       Sales.........................................................    3,052     24,987    14,435     3,848
    Food products....................................................   13,666     34,504    34,294    23,877
    Other............................................................      764        798       776       848
                                                                      --------   --------  --------  --------
       Total revenue................................................. $232,225   $289,160  $285,786  $261,475
                                                                      ========   ========  ========  ========
Operating Profit (Loss):
    Ocean transportation............................................. $ 19,893   $ 27,914  $ 26,106  $ 19,819
    Property development and management:.............................
       Leasing.......................................................    7,184      7,606     7,467     7,863
       Sales.........................................................      701     18,917     5,472      (862)
    Food products....................................................    2,068     (2,060)    2,901     4,613
    Other............................................................      709        764       745       756
                                                                      --------   --------  --------  --------
       Total operating profit........................................   30,555     53,141    42,691    32,189
Interest Expense.....................................................   (5,347)    (5,959)   (6,661)   (6,285)
General Corporate Expenses...........................................   (3,502)    (2,706)   (2,392)   (3,009)
                                                                      --------   --------  --------  --------
Income Before Income Taxes and Accounting Change.....................   21,706     44,476    33,638    22,895
    Income taxes.....................................................   (7,525)   (16,233)  (12,284)   (8,349)
    Change in accounting method (net of income taxes of $7,668)/1/...   12,250         --        --        --
                                                                      --------   --------  --------  --------
Net Income........................................................... $ 26,431   $ 28,243  $ 21,354  $ 14,546
                                                                      ========   ========  ========  ========
Earnings Per Share:
    Basic............................................................ $   0.63   $   0.69  $   0.53  $   0.36
    Diluted.......................................................... $   0.63   $   0.69  $   0.52  $   0.36

- --------
/1/ See Note 2 for discussion of changes in presentation and accounting method

                                      54

<p Style="page-break-after:always">

16.  PARENT COMPANY CONDENSED FINANCIAL INFORMATION

   Set forth below are the unconsolidated condensed financial statements of
Alexander & Baldwin, Inc. (Parent Company). The significant accounting policies
used in preparing these financial statements are substantially the same as
those used in the preparation of the consolidated financial statements as
described in Note 1, except that, for purposes of the tables presented in this
footnote, subsidiaries are carried under the equity method.

   The following table presents the Parent Company's condensed Balance Sheets
as of December 31, 2001 and 2000:



                                                          2001        2000
                                                       ----------  ----------
                                                           (in thousands)
                                                             
 ASSETS
 Current Assets:
     Cash and cash equivalents........................ $   15,509  $      126
     Accounts and notes receivable, net...............     11,971      10,065
     Prepaid expenses and other.......................     13,157    1923,432
                                                       ----------  ----------
        Total current assets..........................     40,637      23,623
                                                       ----------  ----------
 Investments:
     Subsidiaries consolidated, at equity.............    545,819     678,636
     Other............................................      1,630     110,714
                                                       ----------  ----------
        Total investments.............................    547,449     789,350
                                                       ----------  ----------
 Property, at Cost....................................    367,332     348,774
     Less accumulated depreciation and amortization...    167,445     161,246
                                                       ----------  ----------
        Property--net.................................    199,887     187,528
                                                       ----------  ----------
 Due from Subsidiaries................................    162,118      46,706
                                                       ----------  ----------
 Other Assets.........................................     31,592      27,973
                                                       ----------  ----------
        Total......................................... $  981,683  $1,075,180
                                                       ==========  ==========

 LIABILITIES AND SHAREHOLDERS' EQUITY
 Current Liabilities:
     Current portion of long-term debt................ $    7,500  $    7,500
     Accounts payable.................................      4,157       2,784
     Income taxes payable.............................     55,034       1,000
     Other............................................     15,572      22,693
                                                       ----------  ----------
        Total current liabilities.....................     82,263      33,977
                                                       ----------  ----------
 Long-term Debt.......................................    107,500     231,000
                                                       ----------  ----------
 Other Long-term Liabilities..........................     16,184      14,762
                                                       ----------  ----------
 Deferred Income Taxes................................     65,069     101,790
                                                       ----------  ----------
 Commitments and Contingencies
 Shareholders' Equity:
     Capital stock....................................     33,328      33,248
     Additional capital...............................     66,659      58,007
     Unrealized holding gains on securities...........         --      61,937
     Retained earnings................................    622,615     552,637
     Cost of treasury stock...........................    (11,935)    (12,178)
                                                       ----------  ----------
        Total shareholders' equity....................    710,667     693,651
                                                       ----------  ----------
        Total......................................... $  981,683  $1,075,180
                                                       ==========  ==========


                                      55

<p Style="page-break-after:always">

   The following table presents the Parent Company's condensed Statements of
Income for the years ended December 31, 2001, 2000 and 1999:



                                                                                                 2001      2000      1999
                                                                                               --------  --------  --------
                                                                                                      (in thousands)
                                                                                                          
Revenue:
  Food products............................................................................... $ 84,428  $ 77,190  $     --
  Property leasing............................................................................   16,422    14,397    10,999
  Property sales..............................................................................   15,569    19,732       803
  Interest, dividends and other...............................................................  131,672     5,055     3,180
                                                                                               --------  --------  --------
    Total revenue.............................................................................  248,091   116,374    14,982
                                                                                               --------  --------  --------
Costs and Expenses:
  Cost of agricultural goods and services.....................................................   78,491    77,302        --
  Cost of property sales and leasing services.................................................   16,764     8,194     4,808
  Selling, general and administrative.........................................................   13,160    11,609     9,686
  Interest and other..........................................................................   20,852    20,220     1,770
  Income taxes................................................................................   42,272    (1,273)   (3,271)
                                                                                               --------  --------  --------
    Total costs and expenses..................................................................  171,539   116,052    12,993
                                                                                               --------  --------  --------
Income Before Equity in Net Income of Subsidiaries Consolidated...............................   76,552       322     1,989
Equity in Net Income of Subsidiaries Consolidated.............................................   43,261    90,252    60,590
Equity in Net Loss from Discontinued Operations of Subsidiaries Consolidated..................   (9,185)       --        --
                                                                                               --------  --------  --------
Net Income....................................................................................  110,628    90,574    62,579
Unrealized holding gains (losses) and reclassification of realized gains on securities, net of
 income taxes.................................................................................  (61,937)   12,476   (13,868)
                                                                                               --------  --------  --------
Comprehensive Income.......................................................................... $ 48,691  $103,050  $ 48,711
                                                                                               ========  ========  ========


                                      56

<p Style="page-break-after:always">

   The following table presents the Parent Company's condensed Statements of
Cash Flows for the years ended December 31, 2001, 2000 and 1999:



                                                        2001       2000       1999
                                                      ---------  ---------  --------
                                                              (in thousands)
                                                                   
Cash Flows from Operations........................... $   6,180  $  (5,634) $  3,579
                                                      ---------  ---------  --------
Cash Flows from Investing Activities:
  Capital expenditures...............................   (22,800)   (18,107)   (1,346)
  Proceeds from disposal of property and investments.   138,222      3,705        --
  Dividends received from subsidiaries...............    40,000     50,000    50,000
                                                      ---------  ---------  --------
  Net cash provided by investing activities..........   155,422     35,598    48,654
                                                      ---------  ---------  --------
Cash Flows from Financing Activities:
  Increase (decrease) in intercompany payable........    11,481     (8,507)   20,757
  Proceeds from (repayments of) long-term debt, net..  (123,500)    60,500        --
  Proceeds from issuance of capital stock............     4,558      2,961       101
  Repurchases of capital stock.......................    (2,270)   (48,260)  (34,824)
  Dividends paid.....................................   (36,488)   (36,785)  (38,899)
                                                      ---------  ---------  --------
  Net cash used in financing activities..............  (146,219)   (30,091)  (52,865)
                                                      ---------  ---------  --------
Cash and Cash Equivalents:
  Net increase (decrease) for the year...............    15,383       (127)     (632)
  Balance, beginning of year.........................       126        253       885
                                                      ---------  ---------  --------
  Balance, end of year............................... $  15,509  $     126  $    253
                                                      =========  =========  ========
Other Cash Flow Information:
  Interest paid, net of amounts capitalized.......... $ (14,386) $ (16,485) $   (303)
  Income taxes paid..................................   (20,961)   (31,807)  (34,213)

Other Non-cash Information:
  Depreciation expense...............................   (12,216)   (11,037)   (2,550)
  Tax-deferred property sales........................    12,415     18,692        --
  Tax-deferred property purchases....................   (12,076)   (18,459)       --


   General Information and Principles of Consolidation:  Alexander & Baldwin,
Inc. ("Parent Company"), headquartered in Honolulu Hawaii, is engaged in the
operations that are described in Note 14, "Industry Segments." Due to a merger,
one of the Company's wholly owned subsidiaries, A&B-Hawaii, Inc., is included
in the Parent Company's financial statements effective January 1, 2000.
Previously, A&B-Hawaii, Inc. was accounted for in the Parent Company financial
statements using the equity method.

   Investments:  Other investments on the Parent Company Balance Sheet at
December 31, 2000, consisted primarily of marketable equity securities that
were liquidated during 2001 (see Note 5).

   Long-term Debt:  The Parent Company's long term debt at December 31, 2001
consisted of all the debt that is described in Footnote 8, with the exceptions
of $99,878,000 of commercial paper notes and $12,400,000 of variable rate
loans. At December 31, 2001, maturities and planned prepayments of all
long-term debt during the next five years are $7,500,000 for 2002, $9,643,000
for 2003, $12,500,000 for 2004, $17,500,000 for 2005 and $17,500,000 for 2006.

   Other Long-term Liabilities:  Other Long-term Liabilities at December 31,
2001 and 2000 consisted principally of deferred compensation, executive benefit
plans and self-insurance liabilities.

   Additional Information:  Additional information related to the Parent
Company is described in the foregoing notes to the consolidated financial
statements.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
        FINANCIAL DISCLOSURE

   Not applicable.

                                      57

<p Style="page-break-after:always">

                                   PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

  A.   Directors

   For information about the directors of A&B, see the section captioned
"Election of Directors" in A&B's proxy statement dated March 11, 2002 ("A&B's
2002 Proxy Statement"), which section is incorporated herein by reference.

  B.   Executive Officers of the Registrant

   The name of each executive officer of A&B (in alphabetical order), age (in
parentheses) as of March 31, 2002, and present and prior positions with A&B and
business experience for the past five years are given below.

   Generally, the term of office of executive officers is at the pleasure of
the Board of Directors. For a discussion of compliance with Section 16(a) of
the Securities Exchange Act of 1934 by A&B's directors and executive officers,
see the subsection captioned "Section 16(a) Beneficial Ownership Reporting
Compliance" in A&B's 2002 Proxy Statement, which subsection is incorporated
herein by reference. For a discussion of severance agreements between A&B and
certain of A&B's executive officers, see the subsection captioned "Severance
Agreements" in A&B's 2002 Proxy Statement, which subsection is incorporated
herein by reference.

  James S. Andrasick (58)
   Senior Vice President, Chief Financial Officer and Treasurer of A&B,
6/00-present; President and Chief Operating Officer, C. Brewer and Company,
Limited, 9/92-3/00.

  Meredith J. Ching (45)
   Vice President (Government & Community Relations) of A&B, 10/92-present;
Vice President of A&B-Hawaii, Inc. ("ABHI") (Government & Community Relations),
10/92-12/99; first joined A&B or a subsidiary in 1982.

  Matthew J. Cox (40)
   Senior Vice President, Chief Financial Officer and Controller of Matson,
6/01-present; Executive Vice President and Chief Financial Officer,
Distribution Dynamics, Inc., 8/99-6/01; Vice President, American President
Lines, Ltd., 12/86-7/99.

  W. Allen Doane (54)
   President and Chief Executive Officer of A&B, and Director of A&B and
Matson, 10/98-present; Vice Chairman of Matson, 12/98-present; Executive Vice
President of A&B, 8/98-10/98; Director of ABHI, 4/97-12/99; Chief Executive
Officer of ABHI, 1/97-12/99; President of ABHI, 4/95-12/99; first joined A&B or
a subsidiary in 1991.

  John F. Gasher (68)
   Vice President (Human Resources) of A&B, 12/99-present; Vice President
(Human Resources Development) of ABHI, 1/97-12/99; first joined A&B or a
subsidiary in 1960.

  G. Stephen Holaday (57)
   Vice President of A&B, 12/99-present; Senior Vice President of ABHI,
4/89-12/99; Vice President and Controller of A&B, 4/93-1/96; first joined A&B
or a subsidiary in 1983.

                                      58

<p Style="page-break-after:always">

  John B. Kelley (56)
   Vice President (Investor Relations) of A&B, 8/01-present; Vice President
(Corporate Planning & Investor Relations) of A&B, 10/99-8/01; Vice President
(Investor Relations) of A&B, 1/95-10/99; Vice President of ABHI, 9/89-12/99;
first joined A&B or a subsidiary in 1979.

  Stanley M. Kuriyama (48)
   Vice President (Properties Group) of A&B, 2/99-present; Chief Executive
Officer and Vice Chairman of A&B Properties, Inc., 12/99-present; Executive
Vice President of ABHI, 2/99-12/99; Vice President of ABHI, 1/92-1/99; first
joined A&B or a subsidiary in 1992.

  Michael J. Marks (63)
   Vice President and General Counsel of A&B, 9/80-present; Secretary of A&B,
8/84-1/99; Senior Vice President and General Counsel of ABHI, 4/89-12/99; first
joined A&B or a subsidiary in 1975.

  C. Bradley Mulholland (60)
   Executive Vice President of A&B, 8/98-present; President of Matson,
5/90-present; Chief Executive Officer of Matson, 4/92-present; Director of A&B,
4/91-present; Director of Matson, 7/89-present; Director of ABHI, 4/91-12/99;
first joined Matson in 1965.

  Alyson J. Nakamura (36)
   Secretary of A&B, 2/99-present; Assistant Secretary of A&B, 6/94-1/99;
Secretary of ABHI, 6/94-12/99; first joined A&B or a subsidiary in 1994.

  Raymond L. Smith (47)
   Chief Operating Officer of Matson, 11/01-present; Chief Executive Officer,
Ampent, 3/01-10/01; Chief Executive Officer, Fritz Companies, Inc., 1/99-11/00;
President, United States Fleet Leasing, 2/93-1/99.

  Thomas A. Wellman (43)
   Controller of A&B, 1/96-present; Assistant Treasurer, 1/96-12/99,
6/00-present; Treasurer of A&B, 1/00-5/00; Vice President of ABHI, 1/96-12/99;
Controller of ABHI, 11/91-12/99; first joined A&B or a subsidiary in 1989.

ITEM 11.  EXECUTIVE COMPENSATION

   See the section captioned "Executive Compensation" in A&B's 2002 Proxy
Statement, which section is incorporated herein by reference.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

   See the section captioned "Security Ownership of Certain Shareholders" and
the subsection titled "Security Ownership of Directors and Executive Officers"
in A&B's 2002 Proxy Statement, which section and subsection are incorporated
herein by reference.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

   See the subsection captioned "Certain Relationships and Transactions" in
A&B's 2002 Proxy Statement, which subsection is incorporated herein by
reference.

                                      59

<p Style="page-break-after:always">

                                    PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

  A.  Financial Statements

   The financial statements are set forth in Item 8 ("Financial Statements and
Supplementary Data") above.

  B.  Financial Statement Schedules

   The financial schedules for Alexander & Baldwin, Inc. (Parent Company) are
set forth in Note 16 of Item 8 ("Financial Statements and Supplementary Data")
above. All other schedules are omitted because of the absence of the conditions
under which they are required or because the information called for is included
in the financial statements or notes thereto.

  C.  Exhibits Required by Item 601 of Regulation S-K

   Exhibits not filed herewith are incorporated by reference to the exhibit
number and previous filing shown in parentheses. All previous exhibits were
filed with the Securities and Exchange Commission in Washington, D.C. Exhibits
filed pursuant to the Securities Exchange Act of 1934 were filed under file
number 0-565. Shareholders may obtain copies of exhibits for a copying and
handling charge of $0.15 per page by writing to Alyson J. Nakamura, Secretary,
Alexander & Baldwin, Inc., P. O. Box 3440, Honolulu, Hawaii 96801.

   3.  Articles of incorporation and bylaws.

       3.a.  Restated Articles of Association of Alexander & Baldwin, Inc., as
       restated effective May 5, 1986, together with Amendments dated April 28,
       1988 and April 26, 1990 (Exhibits 3.a.(iii) and (iv) to A&B's Form 10-Q
       for the quarter ended March 31, 1990).

       3.b.  Revised Bylaws of Alexander & Baldwin, Inc. (as Amended Effective
       February 22, 2001) (Exhibit 3.b.(i) to A&B's Form 10-K for the year
       ended December 31, 2000).

   4.  Instruments defining rights of security holders, including indentures.

       4.a.  Equity.

       4.a.  Rights Agreement, dated as of June 25, 1998 between Alexander &
       Baldwin, Inc. and ChaseMellon Shareholder Services, L.L.C. and Press
       Release of Alexander & Baldwin, Inc. (Exhibits 4 and 99 to A&B's Form
       8-K dated June 25, 1998).

       4.b.  Debt.

       4.b.  Third Amended and Restated Revolving Credit and Term Loan
       Agreement, dated November 19, 2001, among Alexander & Baldwin, Inc. and
       First Hawaiian Bank, Bank of America, N.A., Bank of Hawaii, The Bank of
       New York, Wells Fargo Bank, National Association, American Savings Bank,
       F.S.B., and First Hawaiian Bank, as Agent.

   10.  Material contracts.

       10.a.  (i) Issuing and Paying Agent Agreement between Matson Navigation
       Company, Inc. and U.S. Bank National Association, as
       successor-in-interest to Security Pacific National Trust (New York),
       with respect to Matson Navigation Company, Inc.'s $150 million
       commercial paper program dated September 18, 1992 (Exhibit
       10.b.1.(xxviii) to A&B's Form 10-Q for the quarter ended September 30,
       1992).

                                      60

<p Style="page-break-after:always">

       (ii) Note Agreement among Alexander & Baldwin, Inc., A&B-Hawaii, Inc.
       and The Prudential Insurance Company of America, effective as of
       December 20, 1990 (Exhibit 10.b.(ix) to A&B's Form 10-K for the year
       ended December 31, 1990).

       (iii) Note Agreement among Alexander & Baldwin, Inc., A&B-Hawaii, Inc.
       and The Prudential Insurance Company of America, dated as of June 4,
       1993 (Exhibit 10.a.(xiii) to A&B's Form 8-K dated June 4, 1993).

       (iv) Amendment dated as of May 20, 1994 to the Note Agreements among
       Alexander & Baldwin, Inc., A&B-Hawaii, Inc. and The Prudential Insurance
       Company of America, dated as of December 20, 1990 and June 4, 1993
       (Exhibit 10.a.(xviv) to A&B's Form 10-Q for the quarter ended June 30,
       1994).

       (v) Amendment dated January 23, 1995 to the Note Agreement among
       Alexander & Baldwin, Inc., A&B-Hawaii, Inc. and The Prudential Insurance
       Company of America, dated as of December 20, 1990 (Exhibit 10.a.(xvi) to
       A&B's Form 10-K for the year ended December 31, 1994).

       (vi) Amendment dated as of June 30, 1995 to the Note Agreements, among
       Alexander & Baldwin, Inc., A&B-Hawaii, Inc. and The Prudential Insurance
       Company of America, dated as of December 20, 1990 and June 4, 1993
       (Exhibit 10.a.(xxvii) to A&B's Form 10-Q for the quarter ended June 30,
       1995).

       (vii) Amendment dated as of November 29, 1995 to the Note Agreements
       among Alexander & Baldwin, Inc., A&B-Hawaii, Inc. and The Prudential
       Insurance Company of America, dated as of December 20, 1990 and June 4,
       1993 (Exhibit 10.a.(xvii) to A&B's Form 10-K for the year ended December
       31, 1995).

       (viii) Revolving Credit Agreement between Alexander & Baldwin, Inc.,
       A&B-Hawaii, Inc., and First Hawaiian Bank, dated December 30, 1993
       (Exhibit 10.a.(xx) to A&B's Form 10-Q for the quarter ended September
       30, 1994).

       (ix) Amendment dated August 31, 1994 to the Revolving Credit Agreement
       between Alexander & Baldwin, Inc., A&B-Hawaii, Inc., and First Hawaiian
       Bank dated December 30, 1993 (Exhibit 10.a.(xxi) to A&B's Form 10-Q for
       the quarter ended September 30, 1994).

       (x) Second Amendment dated March 29, 1995 to the Revolving Credit
       Agreement between Alexander & Baldwin, Inc., A&B-Hawaii, Inc., and First
       Hawaiian Bank, dated December 30, 1993 (Exhibit 10.a.(xxiii) to A&B's
       Form 10-Q for the quarter ended March 31, 1995).

       (xi) Third Amendment dated November 30, 1995 to the Revolving Credit
       Agreement between Alexander & Baldwin, Inc., A&B-Hawaii, Inc., and First
       Hawaiian Bank, dated December 30, 1993 (Exhibit 10.a.(xvii) to A&B's
       Form 10-K for the year ended December 31, 1996).

       (xii) Fourth Amendment dated November 25, 1996 to the Revolving Credit
       Agreement between Alexander & Baldwin, Inc., A&B-Hawaii, Inc., and First
       Hawaiian Bank, dated December 30, 1993 (Exhibit 10.a.(xviii) to A&B's
       Form 10-K for the year ended December 31, 1996).

       (xiii) Fifth Amendment dated November 28, 1997 to the Revolving Credit
       Agreement between Alexander & Baldwin, Inc., A&B-Hawaii, Inc., and First
       Hawaiian Bank, dated December 30, 1993 (Exhibit 10.a.(xix) to A&B's Form
       10-K for the year ended December 31, 1997).

       (xiv) Sixth Amendment dated November 30, 1998 to the Revolving Credit
       Agreement between Alexander & Baldwin, Inc., A&B-Hawaii, Inc., and First
       Hawaiian Bank, dated December 30, 1993 (Exhibit 10.a.(xiv) to A&B's Form
       10-K for the year ended December 31, 1998).

       (xv) Seventh Amendment dated November 23, 1999 to the Revolving Credit
       Agreement between Alexander & Baldwin, Inc., A&B-Hawaii, Inc., and First
       Hawaiian Bank, dated December 30, 1993 (Exhibit 10.a.(xv) to A&B's Form
       10-K for the year ended December 31, 1999).


                                      61

<p Style="page-break-after:always">

       (xvi) Eighth Amendment dated May 3, 2000 to the Revolving Credit
       Agreement ("Agreement") between Alexander & Baldwin, Inc. and First
       Hawaiian Bank, dated December 30, 1993 (A&B-Hawaii, Inc., an original
       party to the Agreement, was merged into Alexander & Baldwin, Inc.
       effective December 31, 1999) (Exhibit 10.a.(xxvii) to A&B's Form 10-Q
       for the quarter ended June 30, 2000).

       (xvii) Ninth Amendment dated November 16, 2000 to the Revolving Credit
       Agreement between Alexander & Baldwin, Inc. and First Hawaiian Bank,
       dated December 30, 1993 (Exhibit 10.a.(xvii) to A&B's Form 10-K for the
       year ended December 31, 2000).

       (xviii) Tenth Amendment dated November 30, 2001 to the Revolving Credit
       Agreement between Alexander & Baldwin, Inc. and First Hawaiian Bank,
       dated December 30, 1993.

       (xix) Private Shelf Agreement between Alexander & Baldwin, Inc.,
       A&B-Hawaii, Inc., and Prudential Insurance Company of America, dated as
       of August 2, 1996 (Exhibit 10.a.(xxxiii) to A&B's Form 10-Q for the
       quarter ended September 30, 1996).

       (xx) First Amendment, dated as of February 5, 1999, to the Private Shelf
       Agreement between Alexander & Baldwin, Inc., A&B-Hawaii, Inc., and
       Prudential Insurance Company of America, dated as of August 2, 1996
       (Exhibit 10.a.(xxii) to A&B's Form 10-K for the year ended December 31,
       1998).

       (xxi) Private Shelf Agreement between Alexander & Baldwin, Inc. and
       Prudential Insurance Company of America, dated as of April 25, 2001
       (Exhibit 10.a.(xlvii) to A&B's Form 10-Q for the quarter ended June 30,
       2001).

       (xxii) Amendment, dated as of April 25, 2001, to the Note Agreement
       among Alexander & Baldwin, Inc., A&B-Hawaii, Inc. and The Prudential
       Insurance Company of America, dated as of June 4, 1993, and the Private
       Shelf Agreement between Alexander & Baldwin, Inc., A&B-Hawaii, Inc., and
       Prudential Insurance Company of America, dated as of August 2, 1996
       (Exhibit 10.a.(xlviii) to A&B's Form 10-Q for the quarter ended June 30,
       2001).

       (xxiii) Private Shelf Agreement between Matson Navigation Company, Inc.
       and Prudential Insurance Company of America, dated as of June 29, 2001
       (Exhibit 10.a.(xlix) to A&B's Form 10-Q for the quarter ended June 30,
       2001).

       (xxiv) Amended and Restated Asset Purchase Agreement, dated as of
       December 24, 1998, by and among California and Hawaiian Sugar Company,
       Inc., A&B-Hawaii, Inc., McBryde Sugar Company, Limited and Sugar
       Acquisition Corporation (without exhibits or schedules) (Exhibit
       10.a.1.(xxxvi) to A&B's Form 8-K dated December 24, 1998).

       (xxv) Amended and Restated Stock Sale Agreement, dated as of December
       24, 1998, by and between California and Hawaiian Sugar Company, Inc. and
       Citicorp Venture Capital, Ltd. (without exhibits) (Exhibit
       10.a.1.(xxxvii) to A&B's Form 8-K dated December 24, 1998).

       (xxvi) Pro forma financial information relative to the Amended and
       Restated Asset Purchase Agreement, dated as of December 24, 1998, by and
       among California and Hawaiian Sugar Company, Inc., A&BHawaii, Inc.,
       McBryde Sugar Company, Limited and Sugar Acquisition Corporaion, and the
       Amended and Restated Stock Sale Agreement, dated as of December 24,
       1998, by and between California and Hawaiian Sugar Company, Inc. and
       Citicorp Venture Capital, Ltd. (Exhibit 10.a.1.(xxxviii) to A&B's Form
       8-K dated December 24, 1998).

       *10.b.1. (i) Alexander & Baldwin, Inc. 1989 Stock Option/Stock Incentive
       Plan (Exhibit 10.c.1.(ix) to A&B's Form 10-K for the year ended December
       31, 1988).

       (ii) Amendment No. 1 to the Alexander & Baldwin, Inc. 1989 Stock
       Option/Stock Incentive Plan (Exhibit 10.b.1.(xxvi) to A&B's Form 10-Q
       for the quarter ended June 30, 1992).

- --------
* All exhibits listed under 10.b.1. are management contracts or compensatory
plans or arrangements.

                                      62

<p Style="page-break-after:always">

       (iii) Amendment No. 2 to the Alexander & Baldwin, Inc. 1989 Stock
       Option/Stock Incentive Plan (Exhibit 10.b.1.(iv) to A&B's Form 10-Q for
       the quarter ended March 31, 1994).

       (iv) Amendment No. 3 to the Alexander & Baldwin, Inc. 1989 Stock
       Option/Stock Incentive Plan (Exhibit 10.b.1.(ix) to A&B's Form 10-K for
       the year ended December 31, 1994).

       (v) Amendment No. 4 to the Alexander & Baldwin, Inc. 1989 Stock
       Option/Stock Incentive Plan (Exhibit 10.b.1.(v) to A&B's Form 10-K for
       the year ended December 31, 2000).

       (vi) Alexander & Baldwin, Inc. 1989 Non-Employee Director Stock Option
       Plan (Exhibit 10.c.1.(x) to A&B's Form 10-K for the year ended December
       31, 1988).

       (vii) Amendment No. 1 to the Alexander & Baldwin, Inc. 1989 Non-Employee
       Director Stock Option Plan (Exhibit 10.b.1.(xxiv) to A&B's Form 10-K for
       the year ended December 31, 1991).

       (viii) Amendment No. 2 to the Alexander & Baldwin, Inc. 1989
       Non-Employee Director Stock Option Plan (Exhibit 10.b.1.(xxvii) to A&B's
       Form 10-Q for the quarter ended June 30, 1992).

       (ix) Amendment No. 3 to the Alexander & Baldwin, Inc. 1989 Non-Employee
       Director Stock Option Plan (Exhibit 10.b.1.(ix) to A&B's Form 10-K for
       the year ended December 31, 2000).

       (x) Alexander & Baldwin, Inc. 1998 Stock Option/Stock Incentive Plan
       (Exhibit 10.b.1.(xxxii) to A&B's Form 10-Q for the quarter ended March
       31, 1998).

       (xi) Amendment No. 1 to the Alexander & Baldwin, Inc. 1998 Stock
       Option/Stock Incentive Plan (Exhibit 10.b.1.(xi) to A&B's Form 10-K for
       the year ended December 31, 2000).

       (xii) Alexander & Baldwin, Inc. 1998 Non-Employee Director Stock Option
       Plan (Exhibit 10.b.1.(xxxiii) to A&B's Form 10-Q for the quarter ended
       March 31, 1998).

       (xiii) Amendment No. 1 to the Alexander & Baldwin, Inc. 1998
       Non-Employee Director Stock Option Plan (Exhibit 10.b.1.(xiii) to A&B's
       Form 10-K for the year ended December 31, 2000).

       (xiv) Alexander & Baldwin, Inc. Non-Employee Director Stock Retainer
       Plan, dated June 25, 1998 (Exhibit 10.b.1.(xxxiv) to A&B's Form 10-Q for
       the quarter ended June 30, 1998).

       (xv) Amendment No. 1 to Alexander & Baldwin, Inc. Non-Employee Director
       Stock Retainer Plan, effective December 9, 1999 (Exhibit 10.b.1.(xi) to
       A&B's Form 10-K for the year ended December 31, 1999).

       (xvi) Second Amended and Restated Employment Agreement between Alexander
       & Baldwin, Inc. and R. J. Pfeiffer, effective as of October 25, 1990
       (Exhibit 10.c.1.(xiii) to A&B's Form 10-K for the year ended December
       31, 1990).

       (xvii) A&B Deferred Compensation Plan for Outside Directors (Exhibit
       10.c.1.(xviii) to A&B's Form 10-K for the year ended December 31, 1985).

       (xviii) Amendment No. 1 to A&B Deferred Compensation Plan for Outside
       Directors, effective October 27, 1988 (Exhibit 10.c.1.(xxix) to A&B's
       Form 10-Q for the quarter ended September 30, 1988).

       (xix) A&B Life Insurance Plan for Outside Directors (Exhibit
       10.c.1.(xix) to A&B's Form 10-K for the year ended December 31, 1985).

       (xx) A&B Excess Benefits Plan, Amended and Restated effective February
       1, 1995 (Exhibit 10.b.1.(xx) to A&B's Form 10-K for the year ended
       December 31, 1994).

       (xxi) Amendment No. 1 to the A&B Excess Benefits Plan, dated June 26,
       1997 (Exhibit 10.b.1.(xxxi) to A&B's Form 10-Q for the quarter ended
       June 30, 1997).

       (xxii) Amendment No. 2 to the A&B Excess Benefits Plan, dated December
       10, 1997 (Exhibit 10.b.1.(xx) to A&B's Form 10-K for the year ended
       December 31, 1997).

                                      63

<p Style="page-break-after:always">

       (xxiii) Amendment No. 3 to the A&B Excess Benefits Plan, dated April 23,
       1998 (Exhibit 10.b.1.(xxxv) to A&B's Form 10-Q for the quarter ended
       June 30, 1998).

       (xxiv) Amendment No. 4 to the A&B Excess Benefits plan, dated June 25,
       1998 (Exhibit 10.b.1.(xxxvi) to A&B's Form 10-Q for the quarter ended
       June 30, 1998).

       (xxv) Amendment No. 5 to the A&B Excess Benefits Plan, dated December 9,
       1998 (Exhibit 10.b.1.(xxii) to A&B's Form 10-K for the year ended
       December 31, 1998).

       (xxvi) Amendment No. 6 to the A&B Excess Benefits Plan, dated October
       25, 2000 (Exhibit 10.b.1.(xxviii) to A&B's Form 10-K for the year ended
       December 31, 2000).

       (xxvii) Restatement of the A&B Executive Survivor/Retirement Benefit
       Plan, effective February 1, 1995 (Exhibit 10.b.1.(xxii) to A&B's Form
       10-K for the year ended December 31, 1994).

       (xxviii) Amendment No. 1 to the A&B Executive Survivor/Retirement
       Benefit Plan, dated October 25, 2000 (Exhibit 10.b.1.(xxx) to A&B's Form
       10-K for the year ended December 31, 2000).

       (xxix) Restatement of the A&B 1985 Supplemental Executive Retirement
       Plan, effective February 1, 1995 (Exhibit 10.b.1.(xxiv) to A&B's Form
       10-K for the year ended December 31, 1994).

       (xxx) Amendment No. 1 to the A&B 1985 Supplemental Executive Retirement
       Plan, dated August 27, 1998 (Exhibit 10.b.1.(xliii) to A&B's Form 10-Q
       for the quarter ended September 30, 1998).

       (xxxi) Amendment No. 2 to the A&B 1985 Supplemental Executive Retirement
       Plan, dated October 25, 2000 (Exhibit 10.b.1.(xxxiii) to A&B's Form 10-K
       for the year ended December 31, 2000).

       (xxxii) Restatement of the A&B Retirement Plan for Outside Directors,
       effective February 1, 1995 (Exhibit 10.b.1.(xxvi) to A&B's Form 10-K for
       the year ended December 31, 1994).

       (xxxiii) Amendment No. 1 to the A&B Retirement Plan for Outside
       Directors, dated August 27, 1998 (Exhibit 10.b.1.(xlii) to A&B's Form
       10-Q for the quarter ended September 30, 1998).

       (xxxiv) Amendment No. 2 to the A&B Retirement Plan for Outside
       Directors, dated October 25, 2000 (Exhibit 10.b.1.(xxxvi) to A&B's Form
       10-K for the year ended December 31, 2000).

       (xxxv) Form of Severance Agreement entered into with certain executive
       officers, as amended and restated effective August 24, 2000 (Exhibit
       10.b.1.(xli) to A&B's Form 10-Q for the quarter ended September 30,
       2000).

       (xxxvi) Alexander & Baldwin, Inc. One-Year Performance Improvement
       Incentive Plan, as restated effective October 22, 1992 (Exhibit
       10.b.1.(xxi) to A&B's Form 10-K for the year ended December 31, 1992).

       (xxxvii) Amendment No. 1 to the Alexander & Baldwin, Inc. One-Year
       Performance Improvement Incentive Plan, dated December 13, 2001.

       (xxxviii) Alexander & Baldwin, Inc. Three-Year Performance Improvement
       Incentive Plan, as restated effective October 22, 1992 (Exhibit
       10.b.1.(xxii) to A&B's Form 10-K for the year ended December 31, 1992).

       (xxxix) Alexander & Baldwin, Inc. Deferred Compensation Plan effective
       August 25, 1994 (Exhibit 10.b.1.(xxv) to A&B's Form 10-Q for the quarter
       ended September 30, 1994).

       (xl) Amendment No. 1 to the Alexander & Baldwin, Inc. Deferred
       Compensation Plan, effective July 1, 1997 (Exhibit 10.b.1.(xxxii) to
       A&B's Form 10-Q for the quarter ended June 30, 1997).

       (xli) Amendment No. 2 to the Alexander & Baldwin, Inc. Deferred
       Compensation Plan, dated June 25, 1998 (Exhibit 10.b.1.(xxxvii) to A&B's
       Form 10-Q for the quarter ended June 30, 1998).


                                      64

<p Style="page-break-after:always">

       (xlii) Amendment No. 3 to the Alexander & Baldwin, Inc. Deferred
       Compensation Plan, dated October 25, 2000 (Exhibit 10.b.1.(xliii) to
       A&B's Form 10-K for the year ended December 31, 2000).

       (xliii) Alexander & Baldwin, Inc. Restricted Stock Bonus Plan, as
       restated effective April 28, 1988 (Exhi-bit 10.c.1.(xi) to A&B's Form
       10-Q for the quarter ended June 30, 1988).

       (xliv) Amendment No. 1 to the Alexander & Baldwin, Inc. Restricted Stock
       Bonus Plan, effective December 11, 1997 (Exhibit 10.b.1.(ii) to A&B's
       Form 10-K for the year ended December 31, 1997).

       (xlv) Amendment No. 2 to the Alexander & Baldwin, Inc. Restricted Stock
       Bonus Plan, dated June 25, 1998 (Exhibit 10.b.1.(xxxviii) to A&B's Form
       10-Q for the quarter ended June 30, 1998).

   11.  Statement re computation of per share earnings.

   21.  Subsidiaries.

      21.  Alexander & Baldwin, Inc. Subsidiaries as of February 14, 2002.

   23.  Consent of Deloitte & Touche LLP dated March 11, 2002 (included as the
   last page of A&B's Form 10-K for the year ended December 31, 2001).

D.  Reports on Form 8-K

   No reports on Form 8-K were filed during the quarter ended December 31, 2001.

                                      65

<p Style="page-break-after:always">

                                  SIGNATURES

   Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.

                                        ALEXANDER & BALDWIN, INC.
                                       (Registrant)

Date: March 11, 2002
                                             /s/  W. ALLEN DOANE
                                          By_________________________________
                                             W. Allen Doane, President
                                             and Chief Executive Officer

   Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant in the capacities and on the dates indicated.

          Signature                     Title                Date
          ---------                     -----                ----

/s/  W. ALLEN DOANE              President and Chief    March 11, 2002
- -----------------------------    Executive Officer and
W. Allen Doane                         Director

/s/   JAMES S. ANDRASICK       Senior Vice President,   March 11, 2002
- -----------------------------   Chief Financial Officer
James S. Andrasick                   and Treasurer

/s/   THOMAS A. WELLMAN            Controller and       March 11, 2002
- -----------------------------     Assistant Treasurer
Thomas A. Wellman

/s/   CHARLES M. STOCKHOLM      Chairman of the Board   March 11, 2002
- -----------------------------        and Director
Charles M. Stockholm

/s/   MICHAEL J. CHUN                 Director          March 11, 2002
- -----------------------------
Michael J. Chun

/s/   LEO E. DENLEA, JR.              Director          March 11, 2002
- -----------------------------
Leo E. Denlea, Jr.

/s/   WALTER A. DODS, JR.             Director          March 11, 2002
- -----------------------------
Walter A. Dods, Jr.

/s/   CHARLES G. KING                 Director          March 11, 2002
- -----------------------------
Charles G. King

                                      66

<p Style="page-break-after:always">

          Signature                       Title                  Date
          ---------                       -----                  ----

/s/   CARSON R. MCKISSICK               Director            March 11, 2002
- -----------------------------
Carson R. McKissick

/s/   C. BRADLEY MULHOLLAND             Director            March 11, 2002
- -----------------------------
C. Bradley Mulholland

/s/   LYNN M. SEDWAY                    Director            March 11, 2002
- -----------------------------
Lynn M. Sedway

/s/   MARYANNA G. SHAW                  Director            March 11, 2002
- -----------------------------
Maryanna G. Shaw

                                      67

<p Style="page-break-after:always">

INDEPENDENT AUDITORS' CONSENT

   We consent to the incorporation by reference in Registration Statements
33-31922, 33-31923, 33-54825, and 333-69197 of Alexander & Baldwin, Inc. and
subsidiaries on Form S-8 of our report dated January 24, 2002, appearing in the
Annual Report on Form 10-K of Alexander & Baldwin, Inc. and subsidiaries for
the year ended December 31, 2001.

/s/ Deloitte & Touche, LLP

Deloitte & Touche LLP
Honolulu, Hawaii
March 11, 2002

                                      68



</PRE><div><a name="thirdrevolver.txt"></a></div><PRE>
                                  $185,000,000

                           THIRD AMENDED AND RESTATED

                                REVOLVING CREDIT

                                      AND

                              TERM LOAN AGREEMENT

                                     among

                           ALEXANDER & BALDWIN, INC.,

                                      and

                              FIRST HAWAIIAN BANK
                             BANK OF AMERICA, N.A.
                                 BANK OF HAWAII
                              THE BANK OF NEW YORK
                     WELLS FARGO BANK, NATIONAL ASSOCIATION
                        AMERICAN SAVINGS BANK, F. S. B.

                                      and

                         FIRST HAWAIIAN BANK, as Agent



                           Dated November 19, 2001




<p Style="page-break-after:always">

                               TABLE OF CONTENTS


ARTICLE I - AMOUNT AND TERMS OF THE LOANS AND LETTERS OF CREDIT....1
     1.1  Revolving Credit.........................................2
     1.2  Revolving Credit Notes...................................3
     1.3  Fees.....................................................3
     1.4  Termination or Reduction of Commitment...................4
     1.5  Term Credit..............................................4
     1.6  Term Notes...............................................4
     1.7  Interest.................................................5
     1.8  Conversions..............................................6
     1.9  Lending Office for Eurodollar Loans......................6
     1.10  Notice and Manner of Borrowing..........................6
     1.11  Voluntary Prepayments...................................7
     1.12  Place and Manner of Payment.............................7
     1.13  Pro Rata Treatment......................................7
     1.14  Borrower's Ability to Obtain Letters of Credit..........8

ARTICLE II - YIELD PROTECTION; CHANGED CIRCUMSTANCES..............12
     2.1  Unavailability or Impracticability of Eurodollar Loans..12
     2.2  Increased Costs.........................................12
     2.3  Reserve Requirements....................................13
     2.4  Illegality of Eurodollar Loans..........................13
     2.5  Substitution of Banks...................................13
     2.6  Indemnity...............................................14
     2.7  Payments of Accrued Amounts.............................14
     2.8  Banks' Obligation to Mitigate...........................15
     2.9  Funding Assumptions.....................................15

ARTICLE III - CONDITIONS PRECEDENT................................15
     3.1  All Loans and Letters of Credit.........................15
     3.2  Effectiveness of the Agreement..........................15
     3.3  Certificate of Agent....................................16
     3.4  Loan Under Term Credit..................................16

ARTICLE IV - REPRESENTATIONS AND WARRANTIES OF THE BORROWER.......16
     4.1  Due Incorporation, Qualification, Etc...................16
     4.2  Capacity................................................16
     4.3  Authority and Enforceability............................16
     4.4  Compliance with other Instruments.......................17
     4.5  Financial Statements....................................17
     4.6  Material Adverse Events.................................17
     4.7  Litigation, Etc.........................................17
     4.8  Title...................................................18
     4.9  Patent and Other Rights.................................18
     4.10  Adverse Contracts and Orders...........................18
     4.11  Taxes..................................................18
     4.12  Lawful Use of Proceeds; Compliance with Federal Reserve
           Board Regulations......................................19
     4.13  Employee Retirement Income Security Act of 1974........19
     4.14  Investment Borrower(s) Act of 1940.....................19
     4.15  Subsidiaries...........................................19
     4.16  Solvency...............................................19

ARTICLE V - REPRESENTATION OF THE BANKS...........................20

ARTICLE VI - AFFIRMATIVE COVENANTS OF THE BORROWER................20
     6.1  Financial Records, Statements and Reports and Inspection20
     6.2  Insurance...............................................22
     6.3  Other Debt..............................................22
     6.4  Maintenance of Existence; Conduct of Business...........23
     6.5  Expenses................................................23
     6.6  Advice of Acquisition...................................23

ARTICLE VII - NEGATIVE COVENANTS OF THE BORROWER..................23
     7.1  Financial Covenants.....................................24
     7.2  Indebtedness............................................24
     7.3  Liens...................................................24
     7.4  Sale of Assets..........................................25
     7.5  Consolidation, Merger, Etc..............................26
     7.6  Investment, Advances and Guarantees.....................26
     7.7  Subsidiary Ownership....................................26
     7.8  Dividends, Redemptions..................................26
     7.9  Release of Restrictions.................................27

ARTICLE VIII - EVENTS OF DEFAULT..................................27
     8.1  Events of Default.......................................27

ARTICLE IX - DEFINITIONS..........................................30
     9.1  Certain Definitions.....................................30
     9.2  Accounting Terms........................................37

ARTICLE X - PARTICIPATIONS; SETOFFS...............................37

ARTICLE XI - RIGHTS AND DUTIES OF THE AGENT AND THE BANKS.........38
     11.1  Obligations Several....................................38
     11.2  Appointment and Duties of Agent; Agent's Fee...........38
     11.3  Discretion and Liability of Agent......................38
     11.4  Event of Default.......................................38
     11.5  Consultation...........................................39
     11.6  Communications to and from Agent.......................39
     11.7  Limitations of Agency..................................39
     11.8  No Representation or Warranty..........................39
     11.9  Bank Credit Decision...................................39
     11.10  Indemnity.............................................40
     11.11  Resignation...........................................40
     11.12  Note Holders..........................................40
     11.13  Co-Agent..............................................40

ARTICLE XII - MISCELLANEOUS.......................................40
     12.1  Entire Agreement.......................................40
     12.2  No Waiver..............................................40
     12.3  Survival...............................................40
     12.4  Notices................................................40
     12.5  Termination............................................41
     12.6  Separability of Provisions.............................41
     12.7  Successors and Assigns.................................41
     12.8  Counterparts...........................................41
     12.9  Choice of Law..........................................41
     12.10  Amendment and Waiver..................................41
     12.11  Indemnification by the Borrower.......................42


Schedules
- ---------

     I       Commitments of Banks


Exhibits
- --------

     A       Revolving Credit Note
     B       Term Note
     C       Certificate of Agent
     D       Letter of Credit Application
     E       Subsidiaries

<p Style="page-break-after:always">

                            THIRD AMENDED AND RESTATED
                                 REVOLVING CREDIT
                             AND TERM LOAN AGREEMENT
                             -----------------------


     THIS THIRD AMENDED AND RESTATED REVOLVING CREDIT AND TERM LOAN AGREEMENT
(the "Agreement"), effective as of November 30, 2001 (the "Effective Date"), at
Honolulu, Hawaii, between ALEXANDER & BALDWIN, INC., a Hawaii corporation (the
"Borrower"), the undersigned Banks (herein called, individually, a "Bank" and,
collectively, the "Banks"), and FIRST HAWAIIAN BANK, as agent for the Banks
(the "Agent") under this Agreement.  Certain other capitalized terms used
herein, unless otherwise defined, are defined in Article IX hereof.

                             PRELIMINARY STATEMENTS
                             ----------------------

          A.   The Borrower, certain of the Banks and other institutions were
parties to the Revolving Credit and Term Loan Agreement dated as of December 1,
1982.  Such Revolving Credit and Term Loan Agreement was amended on nine
occasions by the First through the Ninth Amendments to Revolving Credit and
Term Loan Agreement.

          B.   The Borrower, with the consent of certain of the Banks and other
institutions, transferred from the Borrower to A & B-Hawaii, Inc., a Hawaii
corporation ("A & B-Hawaii") the bulk of its assets excluding the stock of
Matson, First Hawaiian, Inc., Bancorp Hawaii, Inc., Hawaii Western Steel, and
its aircraft and certain less material assets (the "Transferred Assets").  A &
B-Hawaii was a wholly owned subsidiary of the Borrower.

          C.   The Borrower and A & B-Hawaii, certain of the Banks and other
institutions were parties to an Amended and Restated Revolving Credit and Term
Loan Agreement dated as of April 1, 1989 pursuant to which borrowings became
the joint and several obligations of the Borrower and A&B-Hawaii.  Such Amended
and Restated Revolving Credit and Term Loan Agreement was amended on eight
occasions by those certain First through Eighth Amendments to Amended and
Restated Revolving Credit and Term Loan Agreement.

          D.   The Borrower and A & B-Hawaii, certain of the Banks and other
institutions were parties to that certain Second Amended and Restated Revolving
Credit and Term Loan Agreement dated as of December 31, 1996.  Such Second
Amended and Restated Revolving Credit and Term Loan Agreement was amended on
four occasions by those certain First through Fourth Amendments to Second
Amended and Restated Revolving Credit and Term Loan Agreement.  The Second
Amended and Restated Revolving Credit and Term Loan Agreement, as amended, is
hereinafter referred to as the "Existing Agreement."

          E.   Pursuant to that certain Third Amendment to Second Amended and
Restated Revolving Credit and Term Loan Agreement dated as of November 30,
1999, due to A & B-Hawaii's merger into the Borrower, A & B-Hawaii ceased to
be a borrower under the Existing Agreement.

          F.   The Borrower, the Banks, and the Agent desire to amend and
restate the Existing Agreement in its entirety all as provided herein.



ARTICLE I - AMOUNT AND TERMS OF THE LOANS AND LETTERS OF CREDIT
- ---------------------------------------------------------------

          Section 1.1  Revolving Credit.
                       ----------------

          A.   Subject to and upon the terms and conditions herein set forth,
each Bank agrees to lend to the Borrower from time to time, until the
Termination Date, amounts hereunder up to an aggregate principal amount not to
exceed at any one time outstanding its Commitment hereunder.  The total amount
of the Revolving Loans and Letters of Credit issued and outstanding shall not
exceed $185,000,000.00 (the "Total Commitment").  Within the limits of each
Bank's Commitment, the Borrower may borrow, prepay pursuant to Section 1.11,
and reborrow under this Section 1.1.  Each Borrowing under this Article I (a
"Revolving Loan," and, collectively, the "Revolving Loans") shall be, (i) in
the case of Eurodollar Loans, not less than $500,000 and an integral multiple
of $50,000 from each Bank and, (ii) in the case of Prime Loans, in an aggregate
principal amount from all the Banks of not less than $1,000,000 and an integral
multiple of $100,000, and shall be made simultaneously from the Banks ratably
according to their respective Commitments.  Upon the Effective Date, all
Revolving Loans (as defined in the Existing Agreement) outstanding under the
Existing Agreement shall become Revolving Loans hereunder and Borrower shall
thereby have liability for such outstanding amounts.

          B.   If the Borrower wishes to extend the then applicable Termination
Date for an additional 12-month period and so long as no Event of Default or
Unmatured Event of Default shall have occurred and be continuing the Borrower
shall, no later than six (6) months prior to the Termination Date, give Notice
to the Agent of such request.  Upon receipt of such Notice, the Agent shall
transmit the same to the Banks, which shall, not later than three (3) months
prior to the Termination Date, give the Agent Notice as to whether each such
Bank consents to the proposed extension.  If all of the Banks consent, the then
applicable Termination Date shall be extended for 12 months.  If any Bank does
not consent, the then applicable Termination Date shall remain in full force
and effect.  Notwithstanding the foregoing provisions of this Section 1.1B,
if the Termination Date has not been so extended, such additional lender(s)
(the "Replacement Lenders") as agree at the election and invitation of the
Borrower to become parties to this Agreement shall have the option to purchase
from the Bank(s) that did not so consent (the "Departing Bank(s)"), and the
Departing Bank(s) shall be required to sell, prior to the Termination Date,
all or any portion of the Note(s) then held by the Departing Bank(s);
provided however that the Commitment of any Replacement Lender, after such
- -------- -------
purchase, shall not be less than $5,000,000.  To the extent the Replacement
Lenders elect to purchase less than 100% of the Note(s) of the Departing
Bank(s), those Banks that would have elected to extend the Termination Date
(the "Continuing Banks") shall have the option to purchase, and the Departing
Bank(s) shall be required to sell, prior to the Termination Date, all or any
of the remaining portion of such Note(s), without recourse to or warranty by
(other than a warranty from each Departing Bank as to the principal amount of
the Loans being purchased from such Departing Bank), or expense to, such
Departing Bank(s).

          In the case of any purchase of 100% of such Notes, (i) the Departing
Banks shall no longer have any obligations hereunder (other than those, if any,
as have been accrued before the date of such purchase) and shall no longer
constitute Banks for purposes of this Agreement, and (ii) this Agreement shall
continue in full force and effect, and the Continuing Banks and such Replace-
ment Lenders shall then constitute the Banks hereunder, and (iii) the then
applicable Termination Date shall be extended for 12 months.  Each Continuing
Bank's Commitment shall be increased in, and each Replacement Bank's Commitment
shall be, an amount equal to the pro rata share of the Departing Banks'
Commitments represented by the Note(s) or portion(s) thereof purchased by such
Continuing Bank or Replacement Bank. Upon completing any purchase pursuant to
this Section 1.1B and upon executing an appropriate Amendment to this
Agreement, each Replacement Lender shall become a Bank hereunder to the extent
of their respective Commitment.  If the Continuing Banks and/or such
Replacement Lenders elect to purchase less than 100% of the Notes then held by
the Departing Banks, then no purchase shall be deemed to have occurred and each
Departing Bank shall make a Term Loan, as of the Termination Date, pursuant to
Sections 1.5 and 1.6, in the amount of their respective Commitments.  In the
case of the issuance of such Term Note, this Agreement shall continue in full
force and effect and the Continuing Banks, any Replacement Lenders and any
Departing Banks holding such Term Notes shall then constitute the Banks
hereunder.

          The purchase price of Notes held by Departing Banks shall be the
outstanding principal amount thereof as of the date of purchase.  Interest
accrued on such Notes and accrued Facility Fees shall remain payable as
provided in this Agreement and upon receipt thereof by the Agent shall be
apportioned among the sellers and purchasers of such Notes pro rata according
to the period each has held such Note or any portion thereof and the
applicable interest rates during such period.

          Section 1.2  Revolving Credit Notes.  The obligation of the Borrower
                       ----------------------
to repay the amount of its Revolving Loans to each Bank is and shall be
evidenced by a promissory note (a "Revolving Credit Note") in substantially
the form of Exhibit A hereto, executed and delivered by the Borrower pursuant
to this Agreement, with appropriate insertions, which shall mature on the
Termination Date, and shall bear interest on the daily unpaid principal amount
at the rate(s) specified in Section 1.7.  Upon the execution and delivery of
a Revolving Credit Note by the Borrower in favor of each of the Banks as stated
herein, any prior Revolving Credit Note under the Existing Agreement shall be
deemed replaced and canceled.  All outstanding Revolving Loans on such replaced
and canceled Revolving Credit Notes (all acknowledged to be Eurodollar Loans)
shall be transferred to the corresponding new Revolving Credit Note executed
concurrently herewith and the interest rate on such outstanding Eurodollar
Loans shall remain in effect until the end of the current Eurodollar Interest
Period for each such outstanding Eurodollar Loan.  The date and amount of each
Revolving Loan made by such Bank to the Borrower and the date and amount of
each payment of principal and interest on such Revolving Loans shall be
recorded by such Bank at the time of each such Revolving Loan or payment, as
the case may be, on the schedule annexed to the Revolving Credit Note;
provided, however, that failure to make such a notation with respect to any
- --------  -------
Revolving Loan shall not limit or otherwise affect (a) the obligation of the
Borrower hereunder or under such Revolving Credit Note, and (b) recognition
of payments of principal or interest on such Revolving Credit Note by the
Borrower.

          Section 1.3 Fees.  The Borrower agrees to pay the Agent, for
                      ----
distribution to the Banks ratably according to their respective Commitments,
the following:

          A.   A  "Facility Fee" computed on the basis of the actual number of
days elapsed and a 365-day year, payable from time to time at the rate of one-
eighth of one percent (0.125%) per annum on the full amount of each Bank's
Commitment.  The Facility Fee shall be determined at the aforesaid rate from
the Effective Date of the Third Amended and Restated Revolving Credit and Term
Loan Agreement to and including the Termination Date.  Except as otherwise
provided in Section 1.4 below, the Facility Fee will be payable quarterly in
arrears not later than the fifteenth day of each January, April, July and
October, for the quarter ending on the last day of the previous month,
commencing October 15, 2001.

          B.   A "Restructuring Fee" equal to one-twentieth of one percent
(0.05%) of the amount of the Total Commitment.  The Restructuring Fee shall be
due and payable upon the Effective Date of this Third Amended and Restated
Revolving Credit and Term Loan Agreement.

          C.   A "Renewal Fee" on any future extension of the Termination Date
of the Total Commitment equal to three-one hundredth of one percent (0.03%) of
the amount of the Total Commitment.  The Renewal Fee shall be due and payable
upon the Effective Date of any future extension of the Termination Date.  Such
Renewal Fee shall be imposed solely as part of the consideration for the
extension of the Termination Date, for any minor adjustments of the Interest
Rate and Fees, and for the normal ordinary course of due diligence necessary
for the Agent to obtain the Banks consent therefor.  Except for the minor
adjustments to the matters described in the prior sentence, any further or
other modification, amendment or restructuring of the Total Commitment in
connection with any future extension of the Termination Date shall be subject
to such further renewal fees as negotiated between the Agent and the Borrower.
Such Renewal Fee shall not be due for the extension of the Termination Date in
effect under the Existing Agreement, effected pursuant to this Third Amended
and Restated Revolving Credit and Term Loan Agreement.

          D.   A Letter of Credit Fee due and payable in accordance with and as
specified in Section 1.14 hereinbelow.

          Section 1.4 Termination or Reduction of Commitment.  Except as
                      --------------------------------------
specifically provided below, the Borrower shall have the right, upon Notice to
the Agent (which shall give prompt Notice thereof to each of the other Banks),
to reduce permanently in an aggregate principal amount of $5,000,000 or an
integral multiple thereof, or terminate, the Total Commitment without premium
or penalty therefor, provided that (i) any permanent partial reduction of the
Total Commitment shall be accompanied first, by a prepayment of so much of the
                                      -----
Revolving Loans necessary to reduce the aggregate amount of all remaining
outstanding Revolving Loans and the aggregate amount of all outstanding Letters
of Credit to the amount  of the Total Commitment as so reduced, and second, if
                                                                    ------
necessary, by a pledge and deposit with the Agent, for the benefit of the Agent
and the Banks, cash or deposit account balances sufficient to fully
collateralize so much of the Letters of Credit outstanding as necessary to
reduce the aggregate amount of all outstanding Letters of Credit not so
collateralized to the amount of the Total Commitment as so reduced, and (ii)
in the case of a termination, the  Revolving Loans then outstanding shall be
paid in full, together in each case with all interest accrued thereon and all
Fees due hereunder, and if there are any Letters of Credit outstanding at the
time of such termination, the Borrower shall, no later than thirty (30) days
prior to the date of termination of the Total Commitment, either (a) make
arrangements satisfactory to the Agent for a credit facility to support all
Letters of Credit that may be outstanding as of the date of termination of the
Total Commitment), or (b) pledge and deposit with the Agent, for the benefit
of the Agent and the Banks, cash or deposit account balances sufficient to
fully collateralize all Letters of Credit outstanding as of the date of
termination of the Total Commitment.  From the effective date of any such
termination or reduction of the Total Commitment, and provided that the
Borrower shall have paid all amounts due as described herein to effectuate
such termination or reduction, the obligation of the Borrower to pay further
Fees shall correspondingly cease or be proportionately reduced.

          Section 1.5  Term Credit.  Subject to and upon the terms and
                       -----------
conditions herein set forth, each Bank agrees to make a term loan (a "Term
Loan," and, collectively, the "Term Loans") to the Borrower on each Bank's
applicable Termination Date in an amount up to an aggregate principal amount
not exceeding the amount of such Bank's Commitment on the applicable
Termination Date.  The proceeds of the Term Loan shall be immediately applied
by each Bank, to the extent necessary, to the repayment in full of the
Revolving Credit Note then held by such Bank.  On each Bank's Termination
Date, the commitment of each Bank shall terminate and any facility fee then
outstanding shall be paid in full.

          Section 1.6  Term Notes.  The obligation of the Borrower to repay the
                       ----------
amount of its Term Loan to each Bank shall be evidenced by a promissory note of
the Borrower (a "Term Note," and collectively, the "Term Notes"), in
substantially the form of Exhibit B hereto, with appropriate insertions, dated
the date of such Term Loan, which shall bear interest on the unpaid principal
amount of each installment thereof at the rate provided in Section 1.7, and
shall be payable in four substantially equal quarterly installments, each equal
to one-fourth of the original principal balances of such Term Note, on the last
Business Day of September, December, March and June of any year commencing the
first such day after the date of the Term Note, all as set forth in such Term
Note; provided, however, that the fourth such installment shall be in an amount
sufficient to repay in full the unpaid principal amount thereof.

          Section 1.7  Interest.
                       --------
          A.   Interest on Each Loan.  Each Loan shall bear interest,
               ---------------------
determined as herein provided, on its unpaid principal amount from the date on
which such Loan is made to the date on which the full amount thereof is repaid.
Interest on each Prime Loan shall be payable quarterly in arrears on the first
Domestic Business Day of each calendar quarter commencing the first such date
after such Prime Loan is made, and at maturity (whether by acceleration or
otherwise), at the applicable Interest Rate computed on the basis of the actual
number of days elapsed and a 365-day or 366-day year.  Accrued interest on each
Eurodollar Loan shall be payable in arrears on (i) the last day of the
applicable Eurodollar Interest Period, and (ii) at maturity (whether by
acceleration or otherwise), at the applicable Interest Rate computed on the
basis of the actual number of days elapsed and a 360-day year.  Notwithstanding
any other provision of this Agreement, the Borrower agrees to repay the
principal amount of each Eurodollar Loan on the last day of the applicable
Eurodollar Interest Period and upon maturity (whether by acceleration or
otherwise), which repayment may be accomplished with the proceeds of a Prime
Loan or Eurodollar Loan to the extent otherwise permitted hereunder.

          B.   Extensions of Eurodollar Loans.  Not later than three (3)
               ------------------------------
Eurodollar Business Days prior to the end of each Eurodollar Interest Period,
the Borrower shall, if it elects to extend the related Eurodollar Loans, give
the Agent a Notice specifying the proposed Extension Date and the duration of
the next succeeding Eurodollar Interest Period.  The Agent shall advise each
Bank of each above Notice promptly after its receipt thereof.

          Any Notice given by the Borrower under this Section 1.7B, shall be
irrevocable.  If no such Notice (or Notice of Conversion pursuant to Section
1.8) is so received by the Agent, the relevant Eurodollar Loans of the Borrower
shall automatically be converted into Prime Loans on the last day of the
relevant Eurodollar Interest Period.

          C.   Interest Rates on Revolving Loans.  Except as otherwise provided
               ---------------------------------
in Section 1.7F:

               (i)    The Interest Rate in respect of each Prime Loan shall
be the Prime Rate;

               (ii)   For each Revolving Loan that is a Eurodollar Loan, the
Interest Rate in respect of each Eurodollar Loan during its related Eurodollar
Interest Period shall be the Eurodollar Rate for such Eurodollar Interest
Period plus eleven-twentieths of one percent (0.55%);

          D.   Interest Rates on Term Loans.  Except as otherwise provided in
               ----------------------------
Section 1.7F:

               (i)    The Interest Rate in respect of each Term Loan that is a
Prime Loan shall be the Prime Rate;

               (ii)   The Interest Rate in respect of each Term Loan that is
a Eurodollar Loan during its related Eurodollar Interest Period shall be the
Eurodollar Rate for such Eurodollar Interest Period plus seven-tenths of one
percent (0.70%).

          E.   Notice of Prime Rate and Eurodollar Rate.  The relevant Interest
               ----------------------------------------
Rates for Prime Loans and Eurodollar Loans shall be determined by the Agent as
herein provided.  Notice of Eurodollar Rates shall be given by the Agent to the
Borrower on or before the first day of the relevant Interest Period, and to
each Bank promptly thereafter, and Notice of changes in the Prime Rate shall be
given by the Agent to the Borrower within a reasonable time after such change
is made.

          F.   Interest Rates After Maturity.  If the Borrower defaults in the
               -----------------------------
payment when due (whether by acceleration or otherwise) of any principal amount
of any loan, or of any other amount (other than interest) due under this
Agreement, the Borrower shall pay interest on such unpaid amount, payable on
demand, from the date such amount shall have become due to the date of actual
payment, for each day from and including the date such amount is payable to but
excluding the date such amount is paid, at a rate equal to the Prime Rate from
time to time in effect, plus two percent (2%).

          Section 1.8  Conversions.  Subject to the terms and conditions of
                       -----------
this Agreement, the Borrower shall have the option to convert at any time any
Loans into Prime Loans or Eurodollar Loans, provided, however, that Eurodollar
                                            --------  -------
Loans may be converted only on the last day of the relevant Eurodollar Interest
Period (except as otherwise required by Section 2.4).  The Borrower shall give
a Notice to the Agent of each proposed Conversion, on the day which is, in the
case of a proposed Conversion into Eurodollar Loans, three (3) Eurodollar
Business Days, prior to the proposed Conversion Date.  Such Notice shall
specify the proposed Conversion Date (which shall be a Domestic Business Day
in the event of a Conversion into Prime Loans and a Eurodollar Business Day in
the event of a Conversion into Eurodollar Loans).  If the Conversion is to be
into Eurodollar Loans, such Notice shall also specify the duration of the
initial Eurodollar Interest Period.  Any Notice given by the Borrower under
this Section shall, subject to the provisions of Article II, be irrevocable
and shall constitute a representation by the Borrower of the matters set forth
in Section 3.lA(i) and 3.lA(ii).  The Agent shall advise each Bank of a
conversion promptly after receiving such Notice from the Borrower.

          Section 1.9  Lending Office for Eurodollar Loans.  As to any
                       -----------------------------------
Eurodollar Loan, each Bank may fulfill its commitment to make any Loan by
causing any of its foreign branches or foreign affiliates to make such Loan
(whether or not such branch or affiliate is named as a lending office on the
signature pages hereof); provided, however, that in such event the obligation
                         --------  -------
of the Borrower to repay such Loan shall nevertheless be to such Bank and
shall, for all purposes of this Agreement (including, without limitation, for
purposes of the definition of the term "Majority Banks") be deemed held by it,
to the extent of such Loan, for the account of such branch or affiliate; and
provided, further, that, as of the time of the making of such election, such
- --------  -------
election does not increase the amounts which would have been payable by the
Borrower to such Bank under this Agreement and such Bank's Note in the absence
of such election.

          Section 1.10  Notice and Manner of Borrowing.  The Borrower shall
                        ------------------------------
give a Notice to the Agent of each proposed Prime Loan Borrowing not less than
four (4) Domestic Business Days prior to the proposed Borrowing Date,
specifying the aggregate principal amount of Prime Loans the Borrower then
desires the Banks to make, and the proposed Borrowing Date thereof (which date
shall be a Domestic Business Day).   The Borrower shall give a Notice to the
Agent of each proposed Eurodollar Loan Borrowing not less than four (4)
Eurodollar Business Days prior to the proposed Borrowing Date, specifying the
aggregate principal amount of Eurodollar Loans the Borrower then desires the
Banks to make, the proposed Borrowing Date and Maturity Date (which dates shall
be Eurodollar Business Days) and the duration of the initial Eurodollar
Interest Period with respect thereto.  Any Notice given by the Borrower under
this Section 1.10 shall, subject to the provisions of Article II, be
irrevocable.  The Agent shall advise each Bank of each such Notice promptly
after the Agent's receipt thereof.  Not later than 12:00 noon, San Francisco
time, on each proposed Borrowing Date, each Bank shall provide the Agent at
its office specified  in Section 12.4, with immediately available funds in
Dollars covering such Bank's Proportional Share of the Borrowing, and the Agent
shall promptly pay over to the Borrower such funds as it has received from the
Banks pursuant to this section by depositing the same in the general deposit
account of the Borrower maintained with the Agent; provided, however, that if
                                                   --------  -------
such Loan is a refinancing of a Eurodollar Loan having a Maturity Date on such
Borrowing Date, each Bank shall on behalf of the Borrower on such Borrowing
Date repay in full or in part such Eurodollar Loans theretofore outstanding
from the proceeds of the Loans made on such Borrowing Date.

          Section 1.11  Voluntary Prepayments.  The Borrower shall have the
                        ---------------------
right at any time and from time to time upon at least one full Business Day's
Notice to the Agent (which shall promptly advise the Banks) to prepay, without
premium or penalty, either the Revolving Credit Notes or the Term Notes, as the
Borrower shall specify, in whole or in part, in the amount of $500,000, or an
integral multiple thereof, provided that (i) any such prepayment on the Term
Notes shall be applied, first to the last maturing installment or installments
of said Notes, (ii) the amount of each prepayment on the Revolving Credit Notes
shall again become available for borrowing pursuant to Section 1.1 on the date
of such prepayment, and (iii) any repayment of Eurodollar Loans shall be made
only on the expiration date(s) of the related Eurodollar Interest Period(s).

          Section 1.12  Place and Manner of Payment.  All amounts payable by
                        ---------------------------
the Borrower to the Banks pursuant to the provisions of this Agreement shall
be paid in Dollars and in immediately available funds.  All such amounts
payable by the Borrower to the Banks shall be paid to the Agent at its office
specified in Section 12.4 for the account of the Banks ratably, and the Agent
shall concurrently pay to the Banks such amounts as and when received by it
for the account of the Banks, in the same funds in which such amounts were
received.  Any payment received by the Agent after 12:00 noon San Francisco
time shall be deemed to have been received on the next Domestic Business Day
and interest thereon shall accrue until, and be payable on, such next Domestic
Business Day.  Any payment made by the Borrower to the Agent pursuant to the
terms of this Agreement or the Notes for the Account of any Bank shall
constitute payment to such Bank.  Until the Borrower gives the Agent a Notice
to the contrary, the Borrower hereby authorizes the Agent to debit the
Borrower's deposit account maintained at said office of the Agent for all
payments of principal and interest when due hereunder.  The Agent shall
promptly furnish the Borrower a written debit advice after each such debit.

          Section 1.13  Pro Rata Treatment.  Each Borrowing from, and change in
                        ------------------
the Commitments of, the Banks hereunder, shall be made pro rata in accordance
with their respective Commitments, except as provided in Section 2.5.  If any
Notes or any payment required to be made thereon becomes due and payable on a
day other than a Domestic or Eurodollar Business Day, as the case may be, the
due date thereof shall be extended to the next succeeding Business Day and
interest thereon shall be payable at the then applicable rate during such
extension, unless, in the case of interest on a Eurodollar Loan, the next
succeeding Eurodollar Business Day falls in another calendar month, in which
case the applicable Eurodollar Interest Period shall expire on the next
preceding Eurodollar Business Day.  Each payment and prepayment on the Term
Notes and on the Revolving Credit Notes shall be made to the Banks pro rata in
accordance with the unpaid principal amount of the Term Notes and Revolving
Credit Notes, respectively, held by each of them at the time of such payment.
The Banks agree among themselves that, if a Bank shall obtain payment of any
obligation held by it through the exercise of a right of setoff, banker's lien
or counterclaim, or from any other source, it shall promptly purchase from the
other Banks participations in the obligations held by the other Banks in such
amounts, and make such other adjustments from time to time, as shall be
equitable to the end that all the Banks shall share the benefit of such payment
pro rata as specified in the preceding sentence, provided, however, that if all
                                                 --------  -------
or any portion of such excess payment is thereafter recovered from such
purchasing Bank, the purchase shall be rescinded and the purchase price
restored to the extent of such recovery, but without interest.  The Banks
further agree that for the purpose of this Section 1.13, all exercises of right
of setoff, banker's lien or counterclaim by any Bank shall be deemed to have
been made against and in respect of the Note or Notes held by such Bank and not
against any other obligation of the Borrower to it.  The Borrower agrees that
any Bank so purchasing a participation in obligations held by the other Banks
may exercise all rights of setoff, banker's lien or counterclaim with respect
to such participation as fully as if such Bank were a direct holder of said
Note or other Obligations in the amount of such participation.

          Section 1.14  Borrower's Ability to Obtain Letters of Credit.  The
                        ----------------------------------------------
Banks agree, subject to the terms and conditions contained herein, to allow
standby letters of credit ("Letters of Credit") to be issued by the Agent for
the account of the Borrower.  The Agent agrees, in reliance upon the agreement
of the Banks set forth herein, from time to time on any Domestic Business Day
for the period from the Effective Date of this Agreement until the date ten
(10) Domestic Business Days prior to the Termination Date (the "Letters of
Credit Expiration Date"), to issue Letters of Credit for the account of the
Borrower and to honor drafts under the Letters of Credit.  The Banks agree to
participate in the Letters of Credit according to each Bank's Proportional
Share, and the responsibility for the payment thereon, upon drawing by a
beneficiary, shall be made by the Banks as specified in sub-part J of this
Section 1.14.  The Letters of Credit shall be issued for general corporate
purposes and for such other purposes as the Banks may approve.

          A.   Conditions to Agent's Obligation to Issue Letters of Credit.
               -----------------------------------------------------------
The Agent's obligation to issue Letters of Credit hereunder is subject to all
of the conditions precedent described in Section 3.1 of this Agreement.
Additionally, the Agent shall be under no obligation to issue any Letter of
Credit if: (i) any order, judgment or decree of any governmental authority or
arbitrator shall by its terms purport to enjoin or restrain the Agent from
issuing such Letter of Credit, or (ii) any law applicable to the Agent or any
request or directive (whether or not having the force of law) from any
governmental authority with jurisdiction over the Agent shall prohibit, or
request that the Agent refrain from, the issuance of letters of credit
generally or such Letter of Credit in particular or shall impose upon the Agent
with respect to such Letter of Credit any restriction, reserve or capital
requirement (for which the Agent is not otherwise compensated hereunder) not in
effect on the Effective Date, or shall impose upon the Agent any unreimbursed
loss, cost or expense which was not applicable on the Effective Date and which
the Agent in good faith deems material to it.

          B.   Notice of Issuance of Letter of Credit.  Notice of each desired
               --------------------------------------
Letter of Credit under this Agreement shall be made by the Borrower to the
Agent on the Agent's standard form, a copy of which is attached hereto as
Exhibit D (the "Letter of Credit Application").  The Letter of Credit
Application shall specify, among other matters required by the Agent, (a) the
proposed date of issuance of the Letter of Credit (which date shall be a
Domestic Business Day), (b) the face amount of the Letter of Credit, (c) the
proposed expiration date of the Letter of Credit (which date shall not be later
than the Letters of Credit Expiration Date), (d) the name and address of the
beneficiary, and (e) a summary of the purpose of the Letter of Credit.  The
Borrower shall also provide to the Agent the precise terms and conditions,
including a description of any and all documents and/or certificates required
thereunder, which, if strictly complied with by the beneficiary on or before
the expiration date of the Letter of Credit, would require the Agent to make
payment under the Letter of Credit.  The Letter of Credit Application shall be
delivered to the Agent no later than four (4) Domestic Business Days prior to
the date the Letter of Credit is desired.  The terms, conditions and
obligations under the Letter of Credit Application shall be deemed to
supplement the terms, conditions and obligations of this Agreement, however,
in the event of any conflict or inconsistency between this Agreement and the
Letter of Credit Application, this Agreement shall control.

          The Agent shall notify each Bank of the issuance of any Letter of
Credit, and thereafter, the amendment, cancellation or extension of all such
issued Letters of Credit.

          C.   Examination of Letter of Credit.  The Borrower shall, within
               -------------------------------
three (3) Domestic Business Days, examine a copy of each Letter of Credit and
each amendment thereto that is delivered to it and, in the event of any claim
of noncompliance with the Borrower's instructions or other irregularity, the
Borrower will notify the Agent prior to the end of the third Business Day after
receipt of such Letter of Credit.  The Borrower shall be conclusively deemed to
have waived any such claim against the Agent and its correspondents unless such
notice is given as aforesaid.

          D.   Applicability of ISP98 and UCP.  Unless otherwise expressly
               ------------------------------
agreed by the Agent and the Borrower when a Letter of Credit is issued (i) the
rules of the "International Standby Practices 1998" published by the Institute
of International Banking Law & Practice (or such later version thereof as may
be in effect at the time of issuance) shall apply to each standby Letter of
Credit, and (ii) the rules of the Uniform Customs and Practice for Documentary
Credits, as most recently published by the International Chamber of Commerce
(the "ICC") at the time of issuance (including the ICC decision published by
the Commission on Banking Technique and Practice on April 6, 1998 regarding the
European single currency (euro)) shall apply to each commercial Letter of
Credit.

          E.   Limitation on Amounts.  Each Letter of Credit shall be for an
               ---------------------
amount which is at least FIVE MILLION AND NO/100 DOLLARS ($5,000,000.00).  The
expiry date of any Letter of Credit shall be no later than the Letters of
Credit Expiration Date.  The aggregate amount of all Letters of Credit issued
and outstanding at any one time may not exceed the amount available under the
Total Commitment after subtracting all outstanding Revolving Loans and in no
event shall it exceed FIFTY MILLION AND NO/100 DOLLARS ($50,000,000.00).  The
amount of the Total Commitment available to the Borrower for Revolving Loans
shall be reduced by the aggregate amount of all Letters of Credit issued and
outstanding at any one time.

          F.   Drawing of Letter of Credit; Interest; Obligations Absolute.
               -----------------------------------------------------------
Upon the drawing of any Letter of Credit and the payment by each Bank of the
amount drawn thereunder in accordance with each Bank's Proportional Share, the
amount so drawn shall become and be deemed a Revolving Loan, the principal
amounts due to each Bank being deemed part of the principal amount due under
each Bank's Revolving Credit Note.  For interest purposes, the amount due under
such drawn Letter of Credit shall be considered a Prime Loan subject to
Conversion by the Borrower under Section 1.8 herein.  Upon the occurrence of an
Event of Default hereunder, the full amount of any outstanding Letter of Credit
shall become and be deemed a Revolving Loan, the principal amount of which
shall be deemed proportionally a part of the principal balance due under each
Banks' Revolving Credit Note.  Interest shall not accrue on any Letters of
Credit until the same has been drawn by the beneficiary and paid by the Agent,
or if an Event of Default occurs.  The obligation of the Borrower to repay each
drawing under any Letter of Credit, whether or not any such drawing under a
Letter of Credit becomes a Revolving Loan, shall be, absent the gross
negligence or wilful misconduct of the Agent or the failure of the Agent to act
in good faith as described in the first sentence of Section 1.14 L with respect
to the honoring of any drawing under any Letter of Credit, absolute,
unconditional and irrevocable, and shall be paid strictly in accordance with
the terms of this Agreement and the Letter of Credit Application.

          G.   Evergreen Letters of Credit.  If the Borrower so requests in any
               ---------------------------
Notice for issuance of a Letter of Credit, the Agent may, in its sole and
absolute discretion, agree to issue a Letter of Credit that has automatic
renewal provisions (each, an "Evergreen Letter of Credit"); provided, however,
                                                            --------
that (1) no such Evergreen Letter of Credit shall have any provision extending
its expiration date beyond the Letters of Credit Expiration Date; and (2) that
any Evergreen Letter of Credit must permit the Agent to prevent any such
automatic renewal at least once in each twelve-month period (commencing with
the date of issuance of such Evergreen Letter of Credit) by giving prior notice
to the Borrower and the beneficiary thereof not later than a date (the
"Nonrenewal Notice Date") in each such twelve-month period to be agreed upon at
the time such Evergreen Letter of Credit is issued.  Once an Evergreen Letter
of Credit has been issued, the Banks shall be deemed to have authorized (but
may not require) the Agent to permit the renewal of an Evergreen Letter of
Credit beyond its expiration date at any time to a date not later than the
Letters of Credit Expiration Date; provided, however, that the Agent shall not
                                   --------  -------
permit such automatic renewal if (A) the Agent would have no obligation at such
time to issue such Evergreen Letter of Credit in its renewed form, or any other
Letter of Credit, under the terms hereof, or (B) it has received notice (which
may be by telephone, telecopier, facsimile or in writing) on or before the
Business Day immediately preceding the Nonrenewal Notice Date that the Majority
Banks have elected not to permit such renewal.  Notwithstanding anything to the
contrary contained herein, nothing in this Section 1.14F shall be construed to
impose any obligation on the Agent to permit the renewal of any Evergreen
Letter of Credit at any time.

          H.   Letter of Credit Fee.  The Borrower agrees to pay the Agent, for
               --------------------
distribution to the Banks pro rata according to their respective Commitments,
for each Letter of Credit issued and outstanding, a "Letter of Credit Fee"
which shall be equal to a percentage of the amount of the Letter of Credit
issued, such percentage to be agreed upon by the Banks for each Letter of
Credit at the time it is issued.  No formal approval by the Banks is necessary
if the Letter of Credit Fee is equal to or greater than 55 basis points (0.55%)
of the amount of the Letter of Credit issued.  If, however, the proposed Letter
of Credit Fee is proposed to be less than 55 basis points (0.55%) of the amount
of the proposed Letter of Credit, unanimous agreement of all Banks is necessary
to set such Letter of Credit Fee at such rate.  If the Banks cannot unanimously
agree as to such rate, the Letter of Credit Fee shall be 55 basis points
(0.55%) of the amount of the proposed Letter of Credit.  The Letter of Credit
Fee shall be aggregated quarterly, such payment to be made quarterly in
advance, based on a year of 360 days and the actual days elapsed.

          I.   Letter of Credit Issuance Fee.  The Borrower also agrees, at the
               -----------------------------
time of issuance of any Letter of Credit, to pay the Agent, for its own account
and not for distribution to Banks, a  "Letter of Credit Issuance Fee" equal to
$500.00.

          J.   Banks' Obligation.  The Banks' obligation to pay their
               -----------------
proportionate share of any drawn Letter of Credit issued by the Agent in
accordance with the terms of this Agreement shall be absolute, unconditional
and irrevocable regardless of whether there has been an Event of Default.  The
Agent shall advise each Bank of the impending drawing of any outstanding Letter
of Credit, and the corresponding date of payment of such Letter of Credit (such
payment date shall be deemed a Borrowing Date as defined herein),  promptly
after the Agent's receipt thereof.  Not later than 12:00 noon, Hawaii Standard
Time, on such Borrowing Date, each Bank shall provide the Agent at its office
specified in Section 12.4, with immediately available funds in Dollars covering
such Bank's Proportional Share of the drawn Letter of Credit, and the Agent
shall promptly pay over to the beneficiary of such Letter of Credit all such
funds necessary to pay the amount of the drawn Letter of Credit as such
beneficiary directs.

          In the event that a Bank fails to make available funds in Dollars
covering such Bank's Proportional Share of the drawn Letter of Credit on the
Borrowing Date, such Bank shall forfeit any interest accruing  on its
Proportional Share to the Agent and such Bank shall on the next Business Day
following the Borrowing Date make such amount available to the Agent, together
with interest at the federal funds rate for and determined as of each day
during such period that the Agent is without such funds from such Bank.

          K.   Indemnification.   The Borrower hereby agrees to protect,
               ---------------
indemnify, pay and save harmless the Agent and the Banks from and against any
and all third party claims, demands, liabilities, damages, losses, costs,
charges and expenses (including reasonable fees, expenses and disbursements of
counsel) which the Agent or Banks may incur or be subject to as a consequence,
direct or indirect, of (i) the issuance of any Letter of Credit by the Agent,
other than as a result of (a) the gross negligence or willful misconduct of the
Agent or the failure of the Agent to act in good faith as described in the
first sentence of Section 1.14 L with respect to the honoring of any drawing
under any Letter of Credit or (b) the wrongful dishonor (so long as such
wrongful dishonor is not a result of an occurrence under the following clause
(ii)) by the Agent of a proper demand for payment made under any Letter of
Credit issued by it or (ii) the failure of the Agent to honor a drawing under
any such Letter of Credit as a result of any act or omission, whether rightful
or wrongful, of any present or future de jure or de facto government or
governmental authority (all such acts or omissions herein called "Governmental
Acts").

          L.   Responsibility of Agent With Respect to Payment Under a Letter
               --------------------------------------------------------------
of Credit; Nature of Agent's Duties.  In determining whether to honor any
- -----------------------------------
drawing under any Letter of Credit by the beneficiary thereof, the Agent shall
be responsible only to use reasonable care (the degree of care reasonably
expected of similar issuers of letters of credit) to determine that the terms
and conditions of such drawing, including the delivery of such documents,
instruments and certificates required therefor, have been complied with by the
beneficiary and the Agent shall not have any liability for or responsibility
for the correctness, validity, genuineness, sufficiency, or falsification of
any such documents, instruments or certificates or for the failure of any
person to comply with the terms any Letter of Credit or for any other error,
neglect, or omission if done in good faith and absent the gross negligence or
wilful misconduct of the Agent, and any action taken in good faith by Agent and
absent the gross negligence or wilful misconduct of the Agent shall be binding
on the Borrower.  As between the Borrower and the Agent, the Borrower assumes
all risks of the acts and omissions of, or misuse of the Letters of Credit
issued by the Agent, by the respective beneficiaries of such Letters of Credit.
In furtherance and not in limitation of the foregoing, and absent the gross
negligence or wilful misconduct of the Agent or the failure of the Agent to act
in good faith as described in the first sentence of Section 1.14 L with respect
to the honoring of any drawing under any Letter of Credit, the Agent shall not
be responsible for: (i) the form, validity, sufficiency, accuracy, genuineness
or legal effect of any document submitted by any party in connection with the
application for and issuance of any such Letter of Credit, even if it should in
fact prove to be in any or all respects invalid, insufficient, inaccurate,
fraudulent or forged; (ii) the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign any such Letter
of Credit or the rights or benefits thereunder or proceeds thereof, in whole or
in part, which may prove to be invalid or ineffective for any reason; (iii)
failure of the beneficiary of such Letter of Credit to strictly comply with any
conditions required in order to draw upon such Letter of Credit; (iv) errors,
omissions, interruptions or delays in transmission or delivery of any messages,
by mail, cable, telegraph, telex or otherwise, whether or not they be in
cipher; (v) errors in interpretation of technical terms; (vi) any loss or delay
in the transmission or otherwise of any document required in order to make a
drawing under any such Letter of Credit or of the proceeds thereof; (vii) the
misapplication by the beneficiary of any such Letter of Credit of the proceeds
of any drawing under such Letter of Credit; or (viii) any consequences arising
from causes beyond the control of such Issuing Lender, including limitation any
Governmental Acts, and none of the above shall affect or prevent the vesting
of, any of the Agent's rights or powers hereunder.

          In furtherance and extension and not in limitation of the specific
provisions set forth in the first paragraph of this Subsection 1.14L, any
action taken by the Agent under or in connection with a Letter of Credit by it
or any documents and certificates delivered thereunder, if taken or omitted in
good faith and without gross negligence, shall not put the Agent under any
resulting liability to the Borrower.

          Notwithstanding anything to the contrary contained in this Section
1.14L, the Borrower shall retain any and all rights it may have against the
Agent for any liability arising solely out of (a) the gross negligence or
willful misconduct of the Agent or the failure of the Agent to act in good
faith as described in the first sentence of Section 1.14 L  with respect to the
honoring of any drawing under any Letter of Credit or (b) the wrongful dishonor
by the Agent of a proper demand for payment made under any Letter of Credit
issued by it except where such dishonor results from Governmental Acts.

ARTICLE II - YIELD PROTECTION; CHANGED CIRCUMSTANCES
- ----------------------------------------------------

          Section 2.1  Unavailability or Impracticability of Eurodollar Loans.
                       ------------------------------------------------------
If (i) with respect to any Eurodollar Interest Period, the Agent reasonably
determines that Dollar deposits in the principal amount requested in the
relevant Notice of Borrowing for periods equal to the relevant Eurodollar
Interest Period are not available in the London Interbank Eurodollar Market, or
(ii) the Majority Banks in any Borrowing reasonably determine, and give Notice
to the Agent, that the making of Eurodollar Loans  in such Borrowing has become
impracticable because the related Eurodollar Rate does not adequately and
accurately reflect the cost of maintaining or funding such Eurodollar Loans,
then the Agent shall forthwith give Notice of such determination to the
Borrower and the Banks in such Borrowing.  Thereafter, and so long as either
conditions specified in clause (i) or (ii) of this Section 2.1 continues, no
Bank shall have any obligation to make or extend Eurodollar Loans (or to
convert Loans into Eurodollar Loans) in such Borrowing (and any outstanding
Notice requesting any such Borrowing, Extension or conversion pertaining to
such Borrowing shall be deemed to be revoked), and the Borrower shall convert
any Eurodollar Loans in such Borrowing into Prime Loans in accordance with
Section 1.8, or prepay such Eurodollar Loans upon four (4) Domestic Business
Days' prior Notice to the Agent, which prepayment shall be made without premium
or penalty and on the expiration date of the related existing Eurodollar
Interest Period.

          Section 2.2  Increased Costs.  If any Bank reasonably determines
                       ---------------
that, because of any Regulatory Requirement (including, but not limited to,
those affecting Taxes or reserve or special deposit or similar requirements),
or because of actions permitted by Section 1.9, the cost to such Bank of making
or maintaining any Loans has increased (which increased cost shall be deemed to
include any decrease in any amount receivable by such Bank in connection with
any Loans), then such Bank shall forthwith give Notice of such determination to
the Borrower and the Agent.  Thereafter, the Borrower shall pay to each such
Affected Bank, fifteen (15) Domestic Business Days after written demand to the
Borrower with a copy to the Agent (which demand shall show the basis for the
calculation of the increased cost), such additional amounts as shall be
required to compensate such Affected Bank for such increased costs.  If as a
result the Borrower elects to prepay or convert Loan(s) pursuant to Section
2.5, the Borrower shall pay fifteen (15) Domestic Business Days after written
demand the increased costs of the Affected Bank(s) accruing for the period
prior to such date of prepayment or Conversion.

          If after the Effective Date the implementation of or any change in
any Regulatory Requirement imposes, modifies or deems applicable any capital
adequacy or similar requirement (including without limitation a request or
requirement which affects the manner in which any Bank allocates capital
resources to its commitments, including its obligations hereunder) and as a
result thereof, in the sole opinion of such Bank, the rate of return on such
Bank's capital as a consequence of its obligations hereunder is reduced to a
level below that which such Bank could have achieved but for such
circumstances, then and in each such case upon demand from time to time the
Borrower shall pay to such Bank such additional amount or amounts as shall
compensate such Bank for such reduction in rate of return; provided, however,
                                                           --------  -------
that such amounts shall be computed solely on a prospective basis from the date
such Bank notifies the Borrower of such circumstances.  A certificate of such
Affected Bank as to any such additional amount or amounts, in the absence of
manifest error, shall be final and conclusive.  In determining such amount,
the Affected Bank may use any reasonable averaging and attribution methods.

          Section 2.3  Reserve Requirements.  In addition to all other amounts
                       --------------------
payable by the Borrower hereunder, the Borrower shall pay to each Bank that is
subject to a Eurodollar Reserve Requirement an amount equal to the difference
between (i) the interest payable to such Bank on each Eurodollar Loan at the
applicable Eurodollar Rate and (ii) the interest that would have been so
payable if such Eurodollar Rate had been multiplied by the following fraction:

                           1
          ___________________________________


          100% - Eurodollar Reserve Requirement


Each Bank which has such a reserve requirement imposed on it shall forthwith
give Notice of such requirement to the Borrower and the Agent.  Within fifteen
(15) Domestic Business Days after the date of such Notice, the Borrower shall
pay to each such Bank such additional amount as shall be required to compensate
such Bank for such reserve requirement; provided, however, to the extent such
                                        --------  -------
additional amounts relate to a Eurodollar Loan that has not yet matured, the
Borrower shall pay such amount upon the maturity of that Eurodollar Loan
concurrently with the payment of interest thereon; and provided further, that
                                                       -------- -------
the Borrower shall not be liable to a Bank for amounts under this Section 2.3
that are allocable to any time more than sixty (60) days before such Bank gives
the Notice of imposition of a reserve requirement described above.

          Section 2.4  Illegality of Eurodollar Loans. If any Bank reasonably
                       ------------------------------
determines that it has become unlawful, because of any Regulatory Requirement,
for such Bank (i) to make Eurodollar Loans hereunder, or (ii) to maintain
Eurodollar Loans hereunder, then such Bank shall give Notice of such
determination to the Borrower and the Agent.  Thereupon, in the case of clause
(i), the obligation of such Affected Bank to make or extend Eurodollar Loans or
to convert Loans into Eurodollar Loans shall be suspended until such time as it
is once again lawful for such Affected Bank to make Eurodollar Loans, and, in
the case of clause (ii), the Borrower shall prepay each Eurodollar Loan of such
Affected Bank either (x) on the last day of the then current Interest Period
applicable to such Eurodollar Loan if such Bank may lawfully continue to fund
and maintain such Eurodollar Loan to such day or (y) immediately if such Bank
may not lawfully continue to fund and maintain such Eurodollar Loan to such
day.  Any such prepayment of an Affected Bank's Eurodollar Loan(s) or any such
conversion of all Borrowings of which the Affected Bank's Eurodollar Loans are
a part shall be subject to the payment of the indemnity referred to in Section
2.6.

          Section 2.5  Substitution of Banks.  If any Affected Bank has given
                       ---------------------
Notice pursuant to Section 2.2 or 2.4, the Borrower shall, at its election,
take one of the following actions: (i) revoke (subject to payment of any
amounts required under Section 2.6) any then pending Notice of proposed
Borrowing or Conversion and give another Notice for a Borrowing or a Conversion
to be made up of, and/or prepay or convert each existing Borrowing made up of
Loans subject to such Notice into a Borrowing consisting of, Loans not subject
to such increased costs or not claimed to be illegal; (ii) if any Affected Bank
has given Notice of increased costs, agree to pay such increased costs, on
terms and conditions mutually satisfactory to the Borrower and such Affected
Bank; (iii) instruct the Affected Bank to make such Affected Bank's Loan as a
Prime Loan, which shall be converted to a Eurodollar Loan at such time as such
Notice is no longer applicable; (iv) request the non-Affected Banks to take
over all (but not part) of such Affected Bank's Loans; provided, however, that
                                                       --------  -------
the non-Affected Banks may elect to take over fewer than all of the Affected
Bank's Loans; or (v) if and only if the non-Affected Banks have elected to take
over less than all of the Affected Bank's Loans, designate a Replacement Lender
or Lenders to take over all of the Loans of the Affected Bank not being taken
over by the non-Affected Banks subject, in the case of (v), to the requirement
that no Replacement Lender may have a Commitment of less than $5,000,000.

          If one or more non-Affected Banks shall so agree in writing, such
non-Affected Banks (pro rata according to their outstanding Loans) shall make
Loans to the Borrower in an aggregate amount equal to the portion of the
outstanding Loans of the Affected Bank being replaced pursuant to this sentence
(and in the same admixture of Prime Loans and Eurodollar Loans as all the
outstanding Loans of the Affected Bank) on a date mutually acceptable to such
non-Affected Banks and the Borrower.  The proceeds of such Loans shall be used
to repay the outstanding principal amount of the Loans of the Affected Bank
being taken over the non-Affected Banks.  If the Borrower designates a
Replacement Lender or Lenders in respect of all or a portion of the outstanding
Loans of the Affected Bank, such Replacement Lenders shall purchase such Loans
or portion, without recourse to or warranty by (other than a warranty from the
Affected Bank as to the principal amount of the Loans being purchased), or
expense to, such Affected Bank, and such Affected Bank shall sell such Loans,
for a purchase price equal to the outstanding principal amount of the Loans of
such Affected Bank being purchased.  Thereafter, the Commitment of such
Affected Bank shall be allocated pro rata among such non-Affected Banks and/or
such Replacement Lender(s).  Any purchase of Eurodollar Loans by non-Affected
Banks or Replacement Lenders shall take place only on the last day of the
relevant Eurodollar Interest Period, or as otherwise required by Section 2.4.

          Upon accomplishment of the foregoing, the Affected Bank shall no
longer have any obligations hereunder (except for obligations, if any, accrued
before and not discharged as of such accomplishment) and shall no longer
constitute a Bank for the purposes of this Agreement.

          Upon completing any purchase pursuant to this Section 2.5 and upon
executing a counterpart of this Agreement, each Replacement Lender shall become
a Bank hereunder.  The Borrower shall provide replacement Notes to each
Replacement Lender and to any non-Affected Bank making Loans pursuant to this
Section 2.5 to reflect the identity of, and/or the increased or new,
respectively, Commitment of, each such non-Affected Bank or Replacement Lender,
respectively.

          Section 2.6  Indemnity.  The Borrower shall compensate each Bank,
                       ---------
fifteen (15) Domestic Business Days after Notice by such Bank (which Notice
shall set forth the basis for requesting such amounts), for all reasonable
losses and expenses in respect of any interest paid or premium or penalty
incurred by such Bank (or its lending ,branch or affiliate) to lenders or
otherwise in respect of the funds borrowed by or deposited with it to make or
maintain its Eurodollar Loans which such Bank (or its lending branch or
affiliate) may sustain, to the extent not otherwise compensated for under this
Agreement (under Section 2.2 or otherwise) and not mitigated by the re-
employment of such funds: (i) if for any reason (other than a default by such
Bank or the operation of Section 2.1) a Borrowing, Conversion or Extension of
any Loan does not occur on a date specified therefor in a Notice of Borrowing,
Conversion or Extension given by the Borrower, including, without limitation,
because a Notice is revoked pursuant to Section 2.5(i), or (ii) if a Eurodollar
Loan is repaid other than on the expiration date of the related Eurodollar
Interest Period.  A statement as to such loss or expense (including
calculations, in reasonable detail, showing how such Bank computed such loss or
expense) shall be promptly submitted by such Bank to the Borrower (with a copy
to the Agent).

          Section 2.7  Payments of Accrued Amounts.  On the date of any Loan
                       ---------------------------
prepayment made in accordance with this Article II, the Borrower shall also
pay, to the Bank being prepaid, interest accrued on the amount of such Loan
being prepaid.  The Borrower shall also make timely payment of all other
amounts owing to such Bank hereunder with respect to the amount of such Loan
being prepaid.

          Section 2.8  Banks' Obligation to Mitigate.  Each Bank agrees that as
                       -----------------------------
promptly as practicable after it becomes aware of the occurrence of an event
that would entitle it to give Notice pursuant to Section 2.2 or 2.4, it will,
prior to the date of any prepayment or Conversion of an affected Loan, use
reasonable efforts to make, fund or maintain such Loan through another lending
office of such Bank if as a result thereof the increased costs would be avoided
or materially reduced or the illegality would thereby cease to exist and if, as
determined by such Bank, the making, financing or maintenance of such Loan
through such other lending office does not otherwise materially adversely
affect such Loan or Bank.  The Borrower hereby agrees to pay all reasonable
expenses incurred by any Bank in utilizing another lending office of such Bank
pursuant to this Section 2.8.

          Section 2.9  Funding Assumptions.  Solely for purposes of calculating
                       -------------------
amounts payable by the Borrower to the Banks under this Article II, (i) each
Eurodollar Loan made by a Bank (and each related reserve, special deposit
similar requirement) shall be conclusively deemed to be funded at the Libor
Rate used in determining the relevant Eurodollar Rate by such Bank (or its
branch or affiliate) by a matching deposit in the London Interbank Eurodollar
Market, whether or not such Loan is in fact so funded.


ARTICLE III - CONDITIONS PRECEDENT
- ----------------------------------

          Section 3.1 All Loans and Letters of Credit.  The obligations of each
                      -------------------------------
of the Banks to make any Loan hereunder, and of the Agent to issue any Letter
of Credit hereunder, are subject to the following conditions precedent:

          A.   Receipt by the Agent from the Borrower of the Notice of
Borrowing specified in Section 1.10 or a Notice for Letter of Credit as
specified in Section 1.14.  Each such Notice received by the Agent hereunder
shall be deemed to be a representation and warranty by the Borrower as of the
Borrowing Date in such Notice that, after giving effect to the requested Loan
or Letter of Credit:

               (i)  the material representations and warranties contained
     herein, on and as the date of such Loan or Letter of Credit, or made in
     any writing delivered or furnished pursuant to this Agreement or to induce
     and Banks to amend or waive any provisions of this Agreement or extend the
     Termination Date on and as of the date as of which made, are or were, as
     the case may be, true and correct in all material respects, and provided
     the representations and warranties contained in Section 4.5 shall be
     deemed to be made with respect to the most recent financial statements
     delivered to the Banks; and

               (ii)  no Event of Default or Unmatured Event of Default shall
     have occurred and be continuing.

          Section 3.2  Effectiveness of the Agreement.  This Agreement shall
                       ------------------------------
not be effective until the following conditions have been satisfied, all of
which shall be deemed either satisfied or waived upon delivery by the Agent of
the certificate attached as Exhibit C:

          A.   The Revolving Credit Notes.  The Borrower shall have delivered
               --------------------------
to the Agent for the account of each Bank duly executed Revolving Credit Notes.

          B.   Certificate of Authority. The Borrower shall have delivered to
               ------------------------
the Agent a certificate of an officer of the Borrower concerning the authority
of the officers executing this Agreement in form and substance satisfactory to
the Agent.

          C.   Required Acts and Conditions.  All acts and conditions
               ----------------------------
(including, without limitation, the obtaining of any necessary regulatory
approvals and the making of any required filings, recordings or registrations)
required to be done and performed, and to have happened precedent to the
execution, delivery and performance of this Agreement and the Notes, and to
constitute the same legal, valid and binding obligations enforceable in
accordance with their respective terms, shall have been done and performed and
shall have happened in due and strict compliance with all applicable laws.

          D.   Documentation and Proceedings.  All corporate and legal
               -----------------------------
proceedings and all instruments in connection with the transactions
contemplated by this Agreement shall be reasonably satisfactory in form and
substance to the Banks and their counsel, Watanabe, Ing & Kawashima, and the
Banks and such counsel shall have received any and all further information
and documents, including records of corporate proceedings, which the Banks
and such counsel may reasonably have requested in connection therewith, such
documents where appropriate to be certified by proper corporate or governmental
authorities.

          Section 3.3  Certificate of Agent.  When the conditions enumerated
                       --------------------
under Section 3.2 have been fulfilled, the Agent, on behalf of the Banks, shall
execute and deliver to the Borrower a certificate substantially in the form of
Exhibit C attached hereto.

          Section 3.4  Loan Under Term Credit.  In the case of the Term Loans
                       ----------------------
pursuant to Section 1.5 above, the Borrower shall have delivered to the Agent
for the account of the Banks Term Notes complying with the requirements of
Section 1.6 above.


ARTICLE IV - REPRESENTATIONS AND WARRANTIES OF THE BORROWER
- -----------------------------------------------------------

          As an inducement to the Banks to enter into this Agreement and to
make the Loans, and to the Agent to issue the Letters of Credit, both as
provided for herein, the Borrower represents and warrants to the Banks and the
Agent as follows:

          Section 4.1  Due Incorporation, Qualification, Etc. The Borrower and
                       --------------------------------------
each of the Significant Subsidiaries are corporations duly organized, validly
existing and in good standing under the law of the jurisdiction in which they
are incorporated and each are authorized to do business in the jurisdictions in
which its ownership of property or conduct of business legally requires such
authorization and where failure to do so would have a material adverse effect
on the Borrower or any such Significant Subsidiary, and has full power and
authority to own its properties and assets and to conduct its business as
presently conducted.

          Section 4.2  Capacity.  The Borrower has full power and authority to
                       --------
execute and deliver, and to perform and observe the provisions of, this
Agreement and the Notes and to carry out the transactions contemplated hereby
and thereby.

          Section 4.3  Authority and Enforceability.  The execution, delivery
                       ----------------------------
and performance by the  Borrower of this Agreement and the Notes have been duly
authorized by all necessary corporate action, and do not and will not require
any registration with, consent or approval of, notice to, or any action by, any
Person, except such, if any, as have been obtained in writing, copies of which
consents have been furnished to the Banks.  This Agreement constitutes, and the
Notes when or as delivered by the Borrower hereunder will or do constitute,
legal, valid and binding obligations of the Borrower enforceable against the
Borrower in accordance with their respective terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency, moratorium,
reorganization or similar laws affecting the enforcement of creditors' rights
generally and by the effect of rules of law governing specific performance,
injunctive relief or other equitable remedies.

          Section 4.4  Compliance with other Instruments.  The execution and
                       ---------------------------------
delivery of this Agreement and compliance with its terms, and the issuance of
the Notes as contemplated herein, will not result in a material breach of any
of the terms or conditions of, or result in the imposition of any lien, charge
or encumbrance upon any properties of the Borrower or its Subsidiaries pursuant
to, or constitute a default (with due notice or lapse of time or both) or
result in an occurrence of an event for which any holder or holders of Funded
Indebtedness with any unpaid principal balance of $1,000,000 or more may
declare the same due and payable under, any indenture, agreement, order,
judgment or instrument under which the Borrower or any of its Subsidiaries is a
party or by which the Borrower or any of its Subsidiaries or its or their
property may be bound or affected, or under the charter documents or bylaws of
the Borrower or any its Subsidiaries, and will not violate any existing
provision of law applicable to the Borrower.

          Section 4.5  Financial Statements.  The consolidated financial
                       --------------------
statements of the Borrower as of and for the year ended December 31, 2000, as
audited by Deloitte & Touche, LLP, and the consolidated unaudited financial
statements of the Borrower as of June 30, 2001, which statements are duly
certified by the Chief Financial Officer of the Borrower, are complete, correct
and present fairly the financial position and results of operations as of or
for the periods indicated, all in accordance with GAAP applied on a consistent
basis, except as set forth in the notes thereto.

          Section 4.6  Material Adverse Events.  Since December 31, 2000, there
                       -----------------------
has been no material adverse change in the business, financial position or
results of operations of the Borrower and its Subsidiaries, considered as a
whole.

          Section 4.7  Litigation, Etc.  Except as reflected in the financial
                       ---------------
statements referred to in Section 4.5 or as otherwise disclosed to the Banks in
writing, (including, without limitation, for such purposes, any document
furnished to the Banks pursuant to Section 6.1) there are no actions, suits or
proceedings (whether or not purportedly on behalf of the Borrower) pending, or
to the knowledge of the Borrower threatened, against or affecting the Borrower
or any of its Subsidiaries, at law or in equity, which, if adversely
determined, could have a material adverse effect on the business, properties or
condition (financial or otherwise) of the Borrower and its Subsidiaries taken
as a whole.  Any action, suit or proceeding as to which the Borrower and/or the
relevant Subsidiary or Subsidiaries have received, from the counsel
representing the Borrower and/or the relevant Subsidiary or Subsidiaries
therein, a written opinion that the likelihood of the successful assertion of
any liability that could have a material adverse effect as described in the
preceding sentence is remote, shall not be deemed an action, suit or proceeding
which could have such a material adverse effect.  After due inquiry, to the
knowledge of the Borrower, neither the Borrower nor any of its Subsidiaries is
in violation or default with respect to any applicable laws and/or regulations
which materially affect the operations and/or condition (financial or
otherwise) of the Borrower and its Subsidiaries taken as a whole nor are they,
or any of them, in violation or default with respect to any order, writ,
injunction, demand or decree of any court or any governmental agency or in
violation or default in any material respect under any indenture, agreement or
other instrument under which the Borrower or any of its Subsidiaries is a party
or may be bound, default under which there might be consequences that would
materially and adversely affect the business, properties or condition
(financial or otherwise) of the Borrower and its Subsidiaries taken as a whole.

          Section 4.8  Title.  The Borrower and its Subsidiaries have good and
                       -----
marketable title to its properties reflected in the consolidated balance sheet
and related notes referred to in Section 4.5 (except (i) those properties
disposed of since the date of such accounts in the ordinary course of business
or as are no longer used or useful in the conduct of its business, (ii) title
defects and encumbrances which either individually or in the aggregate are of
no material consequence to the Borrower and its Subsidiaries taken as a whole,
(iii) such vessels and other assets of Matson, title to which is held in the
name of owner trusts or similar entities pursuant to the requirements of the
transactions by which the construction and/or purchase of the same were
financed, and (iv) property leased pursuant to finance leases) and all
properties and assets acquired by the Borrower or a Subsidiary thereafter and
prior to the Effective Date; and all such properties and assets are not subject
to any lien (including any encumbrance or security interest), except liens
permitted under Section 7.3 hereof and those which are reflected in the most
recent balance sheet (referred to in Section 4.5) and the related notes.

          Section 4.9  Patent and Other Rights.  The Borrower and its
                       -----------------------
Subsidiaries either possess or have applied for all material patents, licenses,
trademarks, trade names, trade secrets, copyrights and all rights with respect
thereto, which are required to conduct their business as now conducted without
known conflict with the rights of others which would materially affect the
business, properties or condition (financial or otherwise) of the Borrower and
its Subsidiaries, taken as a whole.

          Section 4.10  Adverse Contracts and Orders.  Except as heretofore
                        ----------------------------
publicly disclosed or disclosed in writing to the Banks, neither the Borrower
nor any of its Subsidiaries is a party to or is bound by, or subject to, any
contract, instrument, charter, bylaw or other corporate restriction or any
order, decree or judgment of any Person (the "Restrictive Documents") which
materially and adversely affects the business, properties or condition
(financial or otherwise) of the Borrower and its Subsidiaries taken as a whole
or is in material default in the performance, observance, or fulfillment of any
of the material obligations or conditions contained in any of such Restrictive
Documents.

          Section 4.11  Taxes.  The Borrower has filed or caused to be filed
                        -----
all material tax returns which are required to be filed by it and any of its
Subsidiaries, pursuant to the laws, regulations or orders of each Person with
taxing power over the Borrower or any of its Subsidiaries or the assets of any
thereof.  The Borrower and each of its Subsidiaries has paid, or made provision
for the payment of, all material taxes, assessments, fees and other govern-
mental charges which have or may have become due pursuant to said returns, or
otherwise, or pursuant to any assessment received by the Borrower or any of its
Subsidiaries, except such taxes, if any, as are being contested in good faith
and as to which adequate reserves (determined in accordance with generally
accepted accounting principles) have been provided.  Federal income tax returns
of the Borrower have been audited by and settled with the Internal Revenue
Service or the statute of limitations has expired for all years to and
including the fiscal year ended December 31, 1998, and the results of such
settlement are or will be properly reflected in the financial statements
referred to in Section 4.5 and Section 6.1.  The charges, accruals and reserves
in respect of taxes on the books of the Borrower are sufficient to comply with
generally accepted accounting principles.  The Borrower knows of no proposed
material tax assessment against it or any of its Subsidiaries, and no extension
of time for the assessment of federal, state or local taxes of the Borrower or
any of its Subsidiaries is in effect or has been requested except in either
case as disclosed in the financial statements furnished to the Banks pursuant
to Sections 4.5 and 6.1A, and except for extensions obtained in the ordinary
course of business.

          Section 4.12  Lawful Use of Proceeds; Compliance with Federal Reserve
                        -------------------------------------------------------
Board Regulations.  All proceeds of the Revolving Loans shall be used by the
- -----------------
Borrower for its general working capital purposes or to make Friendly
Acquisitions or by the Borrower to repurchase shares of the capital stock of
the Borrower.  No part of the proceeds of the Loans will be used, directly or
indirectly, for the purpose of purchasing or carrying or trading in any
securities under such circumstances as to involve the Borrower in a violation
of Regulation X of the Federal Reserve Board or the Banks in a violation of
Regulation U of the Federal Reserve Board.  If requested by the Banks, the
Borrower will furnish to the Banks in connection with the Loans a statement in
conformity with the requirements of Federal Reserve Form U-1 referred to in
said Regulation U.

          Section 4.13  Employee Retirement Income Security Act of 1974.
                        -----------------------------------------------

          A.   To the best of the Borrower's knowledge, after due inquiry, no
material Reportable Event has occurred and is continuing with respect to any
Plan.

          B.   No accumulated funding deficiency (as defined in section 302 of
ERISA and section 412 of the Code), whether or not waived, exists with respect
to any Plan (other than a Multiemployer Plan).  No liability to the PBGC has
been or is expected by the Borrower or any ERISA Affiliate to be incurred with
respect to any Plan (other than a Multiemployer Plan) by the Borrower, any
Subsidiary or any ERISA Affiliate which is or would be materially adverse to
the business, condition (financial or otherwise) or operations of the Borrower
and its Subsidiaries taken as a whole.  Neither Borrower, any of its
Subsidiaries nor any ERISA Affiliate has incurred or presently expects to incur
any withdrawal liability under Title IV or ERISA with respect to any Multi-
employer Plan which is or would be materially adverse to the Borrower and its
Subsidiaries taken as a whole.  The execution and delivery of this Agreement
and of the Notes will be exempt from, or will not involve any transaction in
connection with which a penalty could be imposed under section 502(i) of ERISA
or a tax could be imposed pursuant to section 4975 of the Code.  The
representation by the Companies in the next preceding sentence is made in
reliance upon and subject to the accuracy of each Bank's representation in
Article V.

          Section 4.14  Investment Borrower(s) Act of 1940.  Neither the
                        ----------------------------------
Borrower nor any of its Subsidiaries is an "investment borrower(s)" within the
meaning of the Investment Borrower Act of 1940.

          Section 4.15  Subsidiaries.  Exhibit E is a complete and correct list
                        ------------
of all present Subsidiaries of the Borrower, which list shows for each
Subsidiary, its state or jurisdiction of incorporation, its principal business,
and the number and percentage of its outstanding securities owned of record
and/or beneficially by the Borrower.  Except as disclosed in Exhibit E,
Borrower directly or indirectly owns, free and clear of all liens, charges,
encumbrances and rights of others whatsoever, all shares of such Subsidiaries
shown on Exhibit E, and all shares of Significant Subsidiaries are validly
issued and fully paid.

          Section 4.16  Solvency.  The fair value of the property of Borrower
                        --------
is greater than the total amount of liabilities, including without limitation
contingent liabilities, of Borrower; the present fair salable value of the
assets of Borrower is not less than the amount that will be required to pay the
probable liability of Borrower on its debts as they become absolute and
matured; Borrower does not intend to, nor does it believe that it will, incur
debts or liabilities beyond its abilities to pay as such debts and liabilities
mature; and Borrower is not engaged in a business or a transaction, or about to
engage in a business or a transaction, for which Borrower's property would
constitute an unreasonably small capital.


ARTICLE V - REPRESENTATION OF THE BANKS
- ---------------------------------------

          Each Bank represents that it is its present intention to make the
Loans for its own account and not to make any public offering or to effect any
distribution of the Notes, subject nevertheless to any requirement of law that
the disposition of its Notes should remain within the control of such Bank.
Each Bank further represents and warrants that no Loan made by it will be made
out of the assets of any separate account maintained by it in which any Plan
(or any individual account plan maintained for employees of the Borrower or any
Subsidiary) has an interest, nor will such Bank assign or otherwise transfer
any of its Loans or Notes to any Plan.


ARTICLE VI - AFFIRMATIVE COVENANTS OF THE BORROWER
- --------------------------------------------------

          During the term of this Agreement and until payment in full of the
obligations, unless compliance shall have been waived in accordance with
Section 12.10 by the Majority Banks, the Borrower agrees that:

          Section 6.1  Financial Records, Statements and Reports and
                       ---------------------------------------------
Inspection.
- ----------


          A.   The Borrower at all times will keep, and will cause each of its
Subsidiaries to keep, books of record and account in which proper entries will
be made of its financial transactions in accordance with generally accepted
accounting principles and will furnish to the Banks:

               (i)  as soon as possible and in any event within ten days after
     any officer of the Borrower has knowledge of the occurrence of each Event
     of Default, or each Unmatured Event of Default which is continuing on the
     date of such statement, the statement of the chief financial officer of
     the Borrower setting forth details of such Event of Default or Unmatured
     Event of Default and the action which the Borrower propose to take with
     respect thereto;

               (ii)  as soon as available and in any event within 45 days after
     the close of each of the first three quarters of the Borrower's fiscal
     year, (a) a consolidated and consolidating balance sheet of the Borrower
     and its Subsidiaries as of the end of such quarter and comparative
     consolidated statements of income for such quarter and year to date, and
     (b) a statement that, to the best of the Borrower's knowledge, after due
     inquiry, no event which constitutes an Event of Default or Unmatured Event
     of Default hereunder has occurred and is continuing, each certified by the
     chief financial officer of the Borrower;

               (iii)  as soon as available and in any event within 90 days
     after the close of the Borrower's fiscal year, (a) a copy of the annual
     report for such year for the Borrower and its Subsidiaries, including
     therein an audited consolidated and consolidating balance sheet of the
     Borrower and its Subsidiaries as of the end of such fiscal year and
     audited consolidated statements of income and shareholders' equity of the
     Borrower and its Subsidiaries for such fiscal year, in the case of each of
     the audited statements, covered by the opinions of Deloitte & Touche, LLP
     or other independent public accountants of recognized standing reasonably
     acceptable to the Banks; and (b) a letter of the chief financial officer
     of the Borrower, dated as of the end of such year, stating that, to the
     best of the Borrower's knowledge, after due inquiry, no event which
     constitutes an Event of Default or Unmatured Event of Default hereunder
     has occurred and is continuing;

               (iv)  within 45 days after the close of each of the first three
     quarters of the Borrower's fiscal year, and within 90 days after the close
     of the Borrower's fiscal year, a "Compliance Certificate" in form
     reasonably satisfactory to the Banks comparing the required quantitative
     covenants set forth in Section 7.1, 7.2, 7.4, 7.5 and 7.8 hereof and
     certified as correct by the chief financial officer of the Borrower;

               (v)  prompt notice of any Reportable Condition reported to the
     Borrower, or to the Borrower's Board of Directors, by the Borrower's
     independent public accountants;

               (vi)  promptly after the sending or filing thereof, copies of
     all proxy statements, financial statements, and reports which the Borrower
     sends to its stockholders, and copies of all regular, periodic and special
     reports, and all registration statements under the Securities Act of 1933,
     as amended, which the Borrower or any Subsidiary files with the Securities
     and Exchange commission, with any governmental authority successor
     thereto, or with any national securities exchange;

               (vii)  promptly after the furnishing thereof, copies of any
     statement or report furnished to any other holder of the securities of the
     Borrower pursuant to the terms of any indenture, loan or credit, or
     similar agreement, and not otherwise required to be furnished to the Bank
     pursuant to any other clause of this Section 6.1A;

               (viii)  prompt notice of any condition or event which has
     resulted in (a) a material adverse change in the Borrower's consolidated
     financial condition or (b) a material breach of or noncompliance with any
     material term, condition or covenant of any material contract to which the
     Borrower or any Significant Subsidiary is a party or by which it or its
     property may be bound;

               (ix)  prompt written notice of any claims, proceedings or
     disputes (whether or not purportedly on behalf of the Borrower) against,
     or to the knowledge of the Borrower, threatened against or affecting, the
     Borrower and/or any of its Subsidiaries not fully covered by insurance
     (other than usual and customary deductibles), which, if adversely
     determined, would have a material adverse effect on the business,
     properties or condition (financial or otherwise) of the Borrower and its
     Subsidiaries taken as a whole (without in any way limiting the foregoing,
     claims, proceedings, or disputes involving monetary amounts the uninsured
     portion of which is in excess of $5,000,000 shall be deemed to be
     material, other than claims for personal injury brought by seamen and
     longshoremen against Matson unless there exists a substantial probability
     that the uninsured liability of Matson thereunder will be in excess of
     $5,000,000), or any material labor controversy resulting in a strike
     against the Borrower or any Significant Subsidiary that is likely to have
     a material adverse effect on the condition (financial or otherwise) of
     the Borrower or such Significant Subsidiary, or any proposal by any public
     authority to acquire any material amount of the assets or business of the
     Borrower or any Significant Subsidiary;

               (x)  (a) and will cause each of its Subsidiaries to furnish to
     the Banks, as soon as possible, and in any event, within thirty (30) days
     after the Borrower or any of its Subsidiaries knows that any material
     Reportable Event with respect to any Plan has occurred, a statement of the
     chief financial officer of the affected Borrower or Subsidiary setting
     forth details as to such material Reportable Event and the action which
     the affected Borrower or Subsidiary proposes to take with respect thereto,
     together with a copy of the notice of such material Reportable Event given
     to the PBGC, if a copy of such notice is available to the affected
     Borrower or Subsidiary, (b) prompt written Notice of any decision by the
     Borrower, any Subsidiary or any member of the Controlled Group to
     terminate or withdraw from any Plan, and (c) promptly after receipt
     thereof a copy of any notice of intent to terminate any Plan or to appoint
     a trustee to administer any Plan which the Borrower, any Subsidiary or any
     member of the Controlled Group may receive from the PBGC or the Internal
     Revenue Service with respect to any Plan; and

               (xi)  at any time the value of all Margin Stock and Publicly
     Traded Securities owned by the Borrower and its Subsidiaries exceeds (or
     following application of the proceeds of an intended Borrowing hereunder
     to a Friendly Acquisition would exceed) 25% of the value of the total
     assets of the Borrower and its Subsidiaries, in each case as reasonably
     determined by the Borrower, the Borrower shall give prompt Notice of such
     fact to the Agent.

          B.   So long as the Borrower is required to file periodic reports
with the Securities and Exchange Commission (or any successor agency thereto)
under the Securities Exchange Act of 1934 (or any successor statute thereto),
the Borrower shall be deemed to have fulfilled their obligations under Sections
6.1A(ii)(a) and 6.1A(iii)(a) to provide consolidated financial statements if
they timely furnish the Banks the Borrower's quarterly report on Form 10-Q and
its annual report on Form 10-K, respectively (or any successor forms required
to be filed under such Act if they contain substantially the same information).

          C.   The Borrower will, upon request, furnish to the Banks and will
cause any of its Subsidiaries to furnish such information as the Banks may
reasonably request with respect to the business, affairs or condition
(financial or otherwise) of the Borrower or any of its Subsidiaries, and will
permit and will cause its Subsidiaries to permit the Banks or representatives
thereof, with reasonable prior Notice, at any reasonable time or times, to
inspect the properties of the Borrower or its Subsidiaries, and to inspect and
examine the books or records of the Borrower and its Subsidiaries and to take
extracts therefrom, in each case while accompanied by an officer or
representative of the Borrower, provided that the information obtained pursuant
to this Section 6.1C, to the extent not otherwise publicly available, shall
remain confidential, but shall be available to the Agent and the other Banks
(until such time, if any, as it otherwise becomes publicly available), subject,
however, to any laws, regulations or orders of any court or governmental agency
requiring the Banks to divulge any of such information.

          Section 6.2  Insurance.  The Borrower will maintain, and will cause
                       ---------
its Subsidiaries to maintain, insurance with responsible and reputable
insurance companies or associations in such amounts and covering such risks as
is usually carried by companies engaged in similar businesses and owning
similar properties in the same general areas in which the Borrower or
Subsidiary operates.  Notwithstanding the foregoing, the Borrower or any of its
Subsidiaries may maintain a plan or plans of self-insurance to such extent and
covering such risks as is usual for companies of comparable size engaged in the
same or similar business, and, on request, the Borrower will advise the Banks
concerning any such plan or plans for self-insurance.

          Section 6.3  Other Debt.  The Borrower will promptly pay and
                       ----------
discharge, and will cause its Subsidiaries to promptly pay and discharge, any
and all Indebtedness, liens, charges, taxes, assessments and governmental
charges or levies imposed upon it or upon its income or profits, or upon any of
its properties prior to the date on which penalties accrue thereon, and lawful
claims which, if unpaid, might become a lien or charge upon the property of the
Borrower or such Subsidiary, except such as may in good faith be contested or
disputed, or for which arrangements for deferred payment have been made,
provided appropriate reserves are maintained to the reasonable satisfaction of
the Majority Banks.

          Section 6.4  Maintenance of Existence; Conduct of Business.  The
                       ---------------------------------------------
Borrower will preserve and maintain, and will cause each of its Significant
Subsidiaries to preserve and maintain, its corporate existence, and all of its
rights, privileges and franchises necessary or desirable in the normal conduct
of its business, and will conduct its business in an orderly and efficient
manner, keep the properties which are useful or necessary in its business in
good working order and condition, and will comply with all applicable laws and
regulations of any governmental authority and the terms of any indenture,
contract or other instrument to which it may be a party or under which it or
its properties may be bound, if noncompliance will have a material adverse
effect upon its consolidated financial condition, except where contested in
good faith and by proper proceedings; provided, however, that nothing herein
                                      --------  -------
contained shall prevent the Borrower or any of its Subsidiaries from exercising
any of their rights under Sections 7.4 and 7.5 of this Agreement.

          Section 6.5  Expenses.  The Borrower will pay all reasonable out-of-
                       --------
pocket expenses of the Agent (including, but not limited to, reasonable fees
and disbursements of the Agent's special counsel) incident to the preparation,
execution and delivery of, and the making of the Loans or Letters of Credit
under this Agreement, the administration of the Loans or Letters of Credit, any
amendments to or waivers of this Agreement, the protection of the rights of the
Banks under this Agreement and the enforcement of payment of the Obligations,
whether by judicial proceedings or otherwise; provided, however, that upon and
                                              --------  -------
after the occurrence of an Event of Default under Section 8.1F, the Borrower
shall pay the reasonable fees and disbursements of each Bank's counsel incurred
by such Bank in its dealings with the Borrower after the occurrence of such
Event of Default.  The billing rates usually and customarily charged by the
counsel referred to in the above proviso in the jurisdiction in which it
maintains its principal offices shall be deemed reasonable under the provisions
of this Section 6.5 even if such rates are greater than the billing rates
usually and customarily charged by counsel whose principal offices are located
in a different jurisdiction where a proceeding to enforce the rights of the
Banks or any Bank under this Agreement may be pending.  The Obligations of the
Borrower under this Section 6.5 shall survive payment of the Loans or Letters
of Credit and cancellation of the Notes.

          Section 6.6  Advice of Acquisition.  Not later than five (5) Business
                       ---------------------
Days before the proposed Borrowing Date of any Borrowing, the proceeds of which
are proposed to be used to make an Acquisition or to replenish any portion of
the Borrower's working capital that is proposed to be or has been expended to
make an Acquisition, the Borrower shall give a Notice to the Agent (which shall
promptly transmit the same to the Banks) specifying: (a) the identity of the
Person the securities or assets of which were or are to be acquired in the
Acquisition, (b) the nature of the Acquisition, (c) the tentative principal
amount of Loans or Letters of Credit to be outstanding at any one time with
respect to such Acquisition; and (d) with respect to a proposed Acquisition,
whether or not the Borrower believes it will be a Friendly Acquisition and the
        -- ---
basis for such belief.  It is understood and agreed that notwithstanding the
provisions of this Section 6.6, the Banks shall make any Loan the proceeds of
which are to be used to make a Friendly Acquisition if the requirements of
Article I hereof have been fulfilled with respect to the proposed Borrowing and
if the conditions of Section 3.1 hereof have been met.  Any Acquisition other
than a Friendly Acquisition for which the proceeds of a Borrowing shall be used
shall require the consent of the Majority Banks.


ARTICLE VII - NEGATIVE COVENANTS OF THE BORROWER
- ------------------------------------------------


          During the term of this Agreement and until the payment in full of
any and all Obligations of the Borrower, without the consent of the Majority
Banks given in accordance with Section 12.10:

          Section 7.1  Financial Covenants.  The Borrower agrees that it will
                       -------------------
not:

          A.   Commencing with the fiscal year beginning January 1, 2001,
permit the Borrower's Consolidated Tangible Net Worth to be less than the sum
of (x) $530,000,000 plus (y) 25% of the Borrower's Consolidated Cumulative Net
Income after December 31, 2000 (such required minimum net worth not to be
reduced by any consolidated net loss during any such period).

          B.   (i)  At any time that the aggregate principal balance of Loans
and Letters of Credit outstanding hereunder is less than $75,000,000, permit
the Borrower's Consolidated Current Assets plus the amount available to the
Borrower under committed (subject only to conditions precedent that are or
could promptly be satisfied) but unfunded lines of credit (including amounts
available hereunder) to be less than 130% of the Borrower's Consolidated
Current Liabilities, and (ii) at any time that the aggregate principal balance
of Loans and Letters of Credit outstanding hereunder is $75,000,000 or more,
permit the Borrower's Consolidated Current Assets plus the amount available
to the Borrower under committed (subject only to conditions precedent that are
or could promptly be satisfied) but unfunded lines of credit (including amounts
available hereunder) to be less than 100% of the Borrower's Consolidated
Current Liabilities.

          C.   Permit the Borrower's consolidated Contingent Liabilities to be
more than 20% of its Consolidated Tangible Net Worth.

          D.   Permit the Borrower's Interest Coverage Ratio for any fiscal
quarter (measured at the end of such fiscal quarter) to be less than 2.0 to
1.0.

          Section 7.2  Indebtedness.  The Borrower agrees that it will not, and
                       ------------
will not permit any of its Subsidiaries to, create, incur, assume or suffer to
exist, or otherwise become or be liable in respect of any Funded Indebtedness,
other than Funded Indebtedness which, together with all other Funded
Indebtedness of the Borrower and its Subsidiaries, does not exceed 300% of
Consolidated Net Income Before Interest, Taxes, Depreciation and Amortization.

          Section 7.3  Liens.  The Borrower agrees that it will not, and will
                       -----
not permit any of its Subsidiaries to, create, incur, assume or suffer to exist
any lien (including any encumbrance or security interest) of any kind upon any
of its assets, whether now owned or hereafter acquired, except:

          A.   liens for taxes, assessments or other governmental charges or
levies not at the time delinquent or thereafter payable without penalty or
being contested in good faith, and liens of carriers, warehousemen, mechanics,
materialmen and landlords incurred in the ordinary course of business for sums
not overdue or being contested in good faith, provided provision is made to the
satisfaction of the Banks for the eventual payment thereof in the event it is
found that such is payable by the Borrower or any of its Subsidiaries;

          B.   liens incurred in the ordinary course of business in connection
with worker's compensation, unemployment insurance or other forms of
governmental insurance or benefits, or to secure performance of tenders and
statutory obligations entered into in the ordinary course of business or to
secure obligations on surety or appeal bonds, or easements, rights of way,
restrictions and similar encumbrances incurred in the ordinary course of
business and not interfering with the ordinary conduct of the business of the
Borrower or any of its Subsidiaries nor materially and adversely affecting the
value of the properties encumbered;

          C.   material judgment liens in existence less than thirty (30) days
after the entry thereof or with respect to which execution has been stayed or
the payment of which is covered in full by insurance;

          D.   liens existing on the Effective Date reflected in the latest
balance sheet furnished to the Banks pursuant to Section 6.1A or any mortgage
or lien which replaces an existing mortgage or other lien, provided the
principal amount of the debt secured by the replacing mortgage or lien does not
exceed the principal amount at the time of replacement of the existing mortgage
or lien, or cover property different from the property covered by the existing
mortgage or lien;

          E.   liens and mortgages on the vessels owned or to be owned or
chartered, or any shoreside facilities or equipment to be owned or leased by
Matson or its Subsidiaries;

          F.   the giving, simultaneously with or within ninety (90) days after
the acquisition or construction of real property or tangible personal property,
of any purchase money lien (including vendor's rights under purchase contracts
under an agreement whereby title is retained for the purpose of securing the
purchase price thereof) on real property or tangible personal property
hereafter acquired or constructed and not heretofore owned by the Borrower or
any of its Subsidiaries, or the acquiring hereafter of real property or
personal tangible property not heretofore owned by the Borrower or any of its
Subsidiaries subject to any then existing lien (whether or not assumed);
provided, however, that in each such case (i) such lien is limited to such
- --------  -------
acquired or constructed real or tangible personal property, and (ii) the
principal amounts of the Indebtedness secured by each such lien, together
(without duplication) with the principal amount of all other Indebtedness
secured by liens on such property, shall not exceed 100% of the cost (which
shall be deemed to include the amount of Indebtedness secured by liens,
including existing liens, on such property) of such property to the Borrower
or any of its Subsidiaries;

          G.   liens incurred in the ordinary course of the Borrower's property
development activities not in excess, in the aggregate, of eighty-five million
dollars ($85,000,000) plus an additional five million dollars ($5,000,000) for
each completed calendar year commencing with the year ended December 31, 2001,
provided that each lien permitted by this Section 7.3G shall be limited to such
real and personal property secured thereby and the aggregate principal amounts
of the debt secured by each such lien, together with the principal amount of
all other debt secured by liens on such property, shall not exceed one-hundred
percent (100%) of the cost (which cost shall be deemed to include the amount of
debt secured by liens, including existing liens, on such property) of such
property to the Borrower;

          H.   other liens, charges or encumbrances incidental to the conduct
of the business of the Borrower and its Subsidiaries or the ownership of their
property and assets which were not incurred in connection with the borrowing of
money or the obtaining of advances of credit and which do not in the aggregate
materially detract from the value of their property or assets or materially
impair the use thereof in the operation of their businesses.

          Section 7.4  Sale of Assets.  The Borrower agrees that it will not,
                       --------------
and Borrower agrees that it will not permit Matson or any Subsidiary of Matson
to, sell the accounts, contract rights or receivables pertaining to its
business or sell, lease, abandon or otherwise dispose of, directly or
indirectly, its assets or any portion thereof except in the ordinary course of
business; provided, however, that the Borrower, Matson or any Subsidiary of
          --------  -------
Matson may discontinue or sell the operations of any division of its business
(other than discontinuing or selling the Borrower's HC&S division substantially
in its entirety), or otherwise may dispose of any operation, right, privilege
or property, if management shall deem the same advisable in the interest of the
business of the Borrower and of Matson and Matson's Subsidiaries, subject to
the provisions of Section 7.5 hereof, and subject to the further provisions
that, (i) in any fiscal year, the aggregate value of all such dispositions not
in the ordinary course of business shall not exceed twenty percent (20%) of
Consolidated Total Assets, and (ii) from and after September 30, 1996, the
aggregate value of all such dispositions not in the ordinary course of business
shall not exceed three hundred sixty million dollars ($360,000,000), provided
                                                                     --------
that at any time such assets disposed of since the beginning of the most
recently ended fiscal year shall not have contributed more than an average of
twenty percent (20%) of Borrower's Consolidated Net Income during the two most
recently ended fiscal years and, provided further that the proceeds of any such
                                 -------- -------
dispositions in excess of one hundred million dollars ($100,000,000) after
September 30, 1996 shall be applied to the repayment of Funded Indebtedness.
Sales of assets from the Borrower's property management and development
activities, and sales of marketable securities owned by the Borrower and that
are not securities issued by a Subsidiary shall be deemed within the ordinary
course of business.

          Section 7.5  Consolidation, Merger, Etc.  The Borrower agrees that it
                       --------------------------
will not, and agrees it will not permit either Matson or any Subsidiary of
Matson to, consolidate or merge with, or sell (whether in one transaction or in
a series of transactions) all or substantially all of its assets to any Person,
except that Matson and any Subsidiary of Matson may merge with or transfer
assets to one another, the Borrower, or any other Subsidiary; provided, that
after such merger or transfer such other Subsidiary shall be subject to the
provisions of Article VII hereof.

          Section 7.6  Investment, Advances and Guarantees.  The Borrower
                       -----------------------------------
agrees that it will not, and Borrower agrees it will not permit Matson or any
Subsidiary of Matson to, advance funds to (by way of loan) or to incur any
Indebtedness with respect to the obligations of, any Person (other than (i) the
Borrower, or a Subsidiary, (ii) employees thereof in connection with customary
employee benefit arrangements, (iii) owner trusts and similar title holding
entities used in transactions to finance vessels, shoreside facilities or
equipment and other facilities to be operated by the Borrower, Matson or any
Subsidiary of Matson or (iv) partnerships or joint ventures in which the
Borrower and/or any Subsidiary is a partner or joint venturer), or make any
Acquisition other than a Friendly Acquisition.

          Section 7.7  Subsidiary Ownership.  The Borrower agrees that it will
                       --------------------
not, except for directors' qualifying shares (if required), directly or
indirectly sell, assign, pledge or otherwise transfer (except to a subsidiary)
any indebtedness of or claim against Matson or any Subsidiary of Matson or any
shares of stock or securities of Matson or any Subsidiary of Matson; and
Borrower will not permit Matson or any Subsidiary of Matson to sell, assign,
pledge or otherwise transfer (except to the Borrower, Matson or a Subsidiary of
Matson) any Indebtedness of or claim against the Borrower, Matson or any
Subsidiary of Matson or any shares of stock or securities of Matson or any
Subsidiary of Matson, except pursuant to a transaction permitted under Section
7.4 or 7.5 of this Agreement.

          Section 7.8  Dividends, Redemptions.  The Borrower agrees that it
                       ----------------------
will not, and will not permit any of its Subsidiaries to, directly or
indirectly:

          A.   Declare or pay any dividend or other distribution on any class
of its capital stock or other equity interests, redeem or repurchase any such
interests or make any other distribution on account of any such interests (all
of the foregoing being "Restricted Payments"), except that the Borrower may
make Restricted Payments in any amount so long as (i) no Event of Default or
Unmatured Event of Default shall then be existing or be existing after giving
effect to any such Restricted Payment, and (ii) any such Restricted Payment
will not violate any applicable law or regulation, including Regulation U of
the Board of Governors of the Federal Reserve System.

          B.   Redeem, retire, purchase or otherwise acquire beneficially any
shares of any class of its own stock, or any stock of the Borrower or any of
its Subsidiaries, now or hereafter outstanding, or set apart any sum for any
such purposes, except that the Borrower may redeem, retire, or repurchase its
own shares, if such shares are immediately retired and canceled, or if the
Borrower delivers to the Agent an opinion of counsel in form and substance
reasonably satisfactory to the Majority Banks that failure to retire and cancel
such shares will not result in the Banks being involved in a violation of
Regulation U of the Board of Governors of the Federal Reserve System; provided,
                                                                      --------
however, that the preceding requirements pertaining to cancellation or
- -------
retirement or the provision of an opinion of counsel shall not apply to shares
being redeemed, retired or repurchased pursuant to an employee benefit plan,
or to options granted employees in the ordinary course of business.

          On and after the date, if any, on which Consolidated Tangible Net
Worth declines to an amount equal to $50,000,000 below the amount then
permitted under Section 7.1A(i), the Borrower shall be prohibited from
reacquiring such shares as aforesaid.  Notwithstanding the provisions of the
preceding sentence, the Borrower may reacquire shares as aforesaid when
Consolidated Tangible Net Worth has declined to an amount more than $50,000,000
below the amount then permitted under Section 7.lA(i), but the aggregate net
consideration paid by the Borrower for such reacquisitions shall not exceed
$1,000,000 and each such reacquisition shall be only pursuant to an employee
benefit plan or to options granted employees in the ordinary course of
business.  When Consolidated Tangible Net Worth has once again increased to the
amount then permitted under Section 7.lA(i), the Borrower may reacquire such
shares as aforesaid, in any amount that will not result in Consolidated
Tangible Net Worth declining to more than $50,000,000 below the amount then
permitted under Section 7.lA(i).  Upon any such reacquisition, in any amount,
the Borrower shall once again become subject to the provisions of the first
sentence of this paragraph.

          Section 7.9  Release of Restrictions.  The restrictions of Sections
                       -----------------------
7.3 and 7.4 shall not apply to any Margin Stock or Publicly Traded Securities
owned by the Borrower or its Subsidiaries to the extent the value of such
Margin Stock and Publicly Traded Securities exceeds 25% of the value of the
total assets of the Borrower and its Subsidiaries.


ARTICLE VIII - EVENTS OF DEFAULT
- --------------------------------

          Section 8.1  Events of Default.  If one or more of the following
                       -----------------
described events shall occur ("Event of Default"):

          A.   The Borrower shall fail to pay interest or any part thereof
within three (3) days of the same becoming due or shall fail to pay any
principal or any part thereof on the day the same becomes due; or

          B.   The Borrower shall fail to perform or observe any of the
provisions contained in Article VII hereof; or

          C.   The Borrower shall fail to perform or observe any of the
provisions contained in any other Article of this Agreement and such failure
shall continue for more than thirty (30) days after the Agent gives the
Borrower Notice of such failure; or

          D.   Any material representation or warranty made herein or in any
writing delivered or furnished pursuant to this Agreement or to induce the
Banks to amend or waive any provisions of this Agreement or to extend the
Termination Date, shall prove to have been false or incorrect in any material
respect, or omits to state a material fact required to be stated therein in
order to make the statements contained therein, in the light of the
circumstances under which made, not misleading, on the date as of which made;
or

          E.   The Borrower shall (i) cause a default in any required payment
to be made, beyond any applicable grace period, or cause a material default in
the performance of any other term, covenant or condition, beyond any applicable
grace period, such default in any required payment or such material default in
the performance of any other term, covenant or condition being as defined in
any evidence of Funded Indebtedness, with a remaining unpaid principal amount
of $5,000,000 or more made or issued by the Borrower or under any indenture,
agreement or other instrument under which the same may be issued, or (ii)
permit any Significant Subsidiary to cause a default in any required payment to
be made, beyond any applicable grace period, as defined in any evidence of
Funded Indebtedness, with a remaining unpaid principal amount of $5,000,000 or
more made or issued by any Significant Subsidiary or under any indenture,
agreement or other instrument under which the same may be issued, or (iii)
cause, or permit any Significant Subsidiary to cause, any event which may
result in the holder or holders of any Funded Indebtedness, with a remaining
unpaid principal amount of $5,000,000 or more made or issued by the Borrower
or any Significant Subsidiary or under any indenture, agreement or other
instrument under which the same may be issued, to declare the same due and
payable before its stated maturity, whether or not such acceleration occurs or
such default shall be waived, except where the Borrower or such Significant
Subsidiary is contesting or disputing in good faith that such a default has
occurred, provided that with respect to any such event caused by a Significant
Subsidiary other than a default in a required payment, acceleration of the
Funded Indebtedness shall have occurred; or

          F.   The Borrower or any Significant Subsidiary shall be the subject
of an order for relief entered by any United States Bankruptcy Court, or shall
be adjudicated a bankrupt or insolvent, or shall fail to pay its debts as they
generally come due, or make an assignment for the benefit of creditors; or the
Borrower or any Significant Subsidiary shall apply for or consent to the
appointment of a receiver, trustee, or similar officer for it or for all or any
substantial part of its property; or such receiver, trustee or similar officer
shall be appointed without the application or consent of the Borrower or any
Significant Subsidiary, as the case may be, and such appointment shall continue
undischarged for a period of sixty (60) days; or the Borrower or any
Significant Subsidiary shall institute (by petition, application, answer,
consent or otherwise) any bankruptcy, insolvency, reorganization, arrangement,
readjustment of debt, dissolution, liquidation or similar proceeding relating
to it under the laws of any jurisdiction; or any such proceeding shall be
instituted (by petition, application or otherwise) against the Borrower or any
Significant Subsidiary and shall remain undismissed for a period of ninety (90)
days; or any judgment, writ, warrant of attachment or execution or similar
process shall be issued or levied against a substantial part of the property of
the Borrower or any Significant Subsidiary and such judgment, writ, or similar
process shall not be released, vacated or fully bonded within sixty (60) days
after its issue or levy; or

          G.   A final judgment for money, in excess of $5,000,000 not covered
by insurance where the insurer has admitted coverage in writing and the insurer
is reasonably satisfactory to the Majority Banks, shall be rendered against the
Borrower or any Significant Subsidiary and if, within sixty (60) days after
entry thereof, such judgment shall not have been discharged, satisfied or
execution thereof stayed pending appeal, or if, within sixty (60) days after
the expiration of any such stay, such judgment shall not have been discharged
or satisfied; or

          H.   (i)  Any material Reportable Event, which the Majority Banks
determine in good faith constitutes grounds for the termination of any Plan or
Plans by the PBGC or for the appointment by the appropriate United States
District Court of a trustee to administer or liquidate any Plan or Plans, shall
have occurred and be continuing thirty (30) days after written notice of such
determination by the Majority Banks shall have been given to the Borrower, or
(ii) a decision shall have been made by either Borrower, any of their
respective Subsidiaries or any member of the Controlled Group to terminate,
file a notice
of termination with respect to, or withdraw from, any Plan or Plans, or (iii) a
trustee shall be appointed by the appropriate United States District Court to
administer any Plan or Plans, or (iv) the PBGC shall institute proceedings to
terminate any Plan or Plans or to appoint a trustee to administer any Plan or
Plans, and in case of the occurrence of any event described in the preceding
clauses (i), (ii), (iii) and (iv) of this subsection 8.lH, the aggregate amount
of either or both Borrower' liability to the PBGC under Sections 4062, 4063 and
4064 of ERISA as determined in good faith by the Majority Banks could exceed 5%
of Consolidated Tangible Net Worth of the Borrower, and such liability is not
covered in full, for the benefit of the Borrower, by insurance;

          THEN, or at any time thereafter:

          (1)  Where the Borrower is in default under the provisions of Section
8.1F, the commitment to make the Loans (except the obligation to pay any issued
and outstanding Letter of Credit drawn prior to its expiration), and the
Agent's obligation to issue Letters of Credit, shall terminate, and the entire
unpaid principal amount of the Notes, all interest accrued and unpaid thereon,
the amount of all Letters of Credit issued and outstanding, and all other
amounts payable hereunder shall automatically become and be forthwith due and
payable, without presentment, demand, protest or notice of any kind, all of
which are hereby expressly waived by the Borrower; and

          (2)  In any other case referred to in this Section 8.1, the Agent
may, at its option, or shall, if directed by the Majority Banks, by written
notice to the Borrower, terminate its obligation to issue Letters of Credit,
and the Majority Banks may, at their option, by written notice to the Borrower
through the Agent, terminate the Commitments of the Banks to make the Loans
(except the obligation to pay any issued and outstanding Letter of Credit which
is drawn prior to its expiration) and/or declare the entire unpaid principal
amount of the Notes, all interest accrued and unpaid thereon, the amount of all
Letters of Credit issued and outstanding, and all other amounts payable
hereunder shall automatically become and be forthwith due and payable, without
presentment, demand, protest or notice of any kind, all of which are hereby
expressly waived by the Borrower.  In the case of either (1) or (2) above,
the Banks may immediately, and without expiration of any period of grace,
enforce payment of all Obligations of the Borrower to it under this Agreement
and under the Notes.

          Any declaration made pursuant to subparagraph (2) above of this
Section 8.1 is subject to the condition that, if at any time after the
principal of the Notes shall have become due and payable, and before any
judgment or decree for the payment of the moneys so due, or any thereof, shall
have been entered, all arrears of interest upon the Notes and all other
Obligations owed to the Banks (except that principal of the Notes which by such
declaration shall have become payable) shall have been duly paid, and every
other Event of Default shall have been made good, waived or cured, then and in
every such case the Majority Banks may, by written notice to the Borrower,
rescind and annul such declaration and its consequences; but no such rescission
or annulment shall extend to or affect any subsequent default or Event of
Default or impair any right consequent thereon.  All such amounts paid by the
Borrower on account of any issued and outstanding Letter of Credit shall be
repaid without interest to the Borrower if such Letter of Credit expires
without having been drawn, and if the Borrower has paid all sums required to be
paid by the Borrower hereunder.

          (3)  The Agent may demand that the Borrower immediately cash
collateralize the then outstanding amount of all Letters of Credit (in an
amount equal to such outstanding amount) by pledging and depositing with the
Agent, for the benefit of the Agent and the Banks, as collateral for such
outstanding Letters of Credit, cash or deposit account balances pursuant to
documentation in form and substance satisfactory to the Agent.

ARTICLE IX - DEFINITIONS
- ------------------------

          Section 9.1  Certain Definitions.  As used herein, and unless
                       -------------------
otherwise defined herein, the following terms shall have the following
respective meanings:

          "Acquisition":  shall mean the acquisition by a Borrower or any
           -----------
Subsidiary (i) of a number of the shares of the capital stock or other
securities of any Person such that at the consummation of the acquisition such
Person will thereby become a Subsidiary, or (ii) the purchase of all or any
substantial division or portion of the assets of any other Person, in either
case in exchange for cash and/or shares of capital stock or other securities of
a Borrower or any other Person.

          "Affected Bank":  shall mean any Bank affected by any event described
           -------------
in the first sentence of any of the first paragraph of Section 2.2, the second
paragraph of Section 2.2, or Section 2.4.

          "Agreement":  shall mean this Third Amended and Restated Revolving
           ---------
Credit and Term Loan Agreement and all future amendments and supplements, if
any, thereto.

          "Borrower": shall mean Alexander & Baldwin, Inc., a Hawaii
           --------
corporation.

          "Borrowing": shall mean a borrowing by the Borrower, or the drawing
           ---------
of a Letter of Credit, from the Banks severally, pursuant to Article I.

          "Borrowing Date":  shall mean the date on which a Borrowing is, or is
           --------------
to be, consummated, as the context may indicate.

          "Business Day":  shall mean a day, other than Saturday, upon which
           ------------
banks in the states of Hawaii, California, New York and Washington are open to
conduct their regular banking business.

          "Code" shall mean the Internal Revenue Code of 1986, as amended.
           ----

          "Commitment": shall mean, when used with reference to any Bank at the
           ----------
time any determination thereof is to be made, the amount of such Bank's
commitment hereunder to extend credit to the Borrower by means of Loans and
Letters of Credit, which shall be the amounts set forth in Schedule I, as from
time to time reduced by the amount of any permanent reduction in such amount
made pursuant to Section 1.4, or increased pursuant to Section 1.1B or Section
2.5.

          "Consolidated Cumulative Net Income":  shall mean the aggregate
           ----------------------------------
Consolidated Net Income of the Borrower for the fiscal period(s) in question.

          "Consolidated Current Assets":  shall mean those assets of the
           ---------------------------
Borrower and its Subsidiaries determined on a consolidated basis which would,
in accordance with GAAP, be classified as current assets of a corporation
conducting a business the same as or similar to the business of the Borrower
and its Subsidiaries.
`
          "Consolidated Current Liabilities":  shall mean Indebtedness of the
           --------------------------------
Borrower and its Subsidiaries determined on a consolidated basis which would,
in accordance with GAAP, be classified as current liabilities of a corporation
conducting a business the same as or similar to the business of the Borrower
and its Subsidiaries.

          "Consolidated Interest Expense":  shall mean the sum of all amounts
           -----------------------------
that would, in accordance with GAAP, be deducted in computing Consolidated Net
Income for such period on account of interest, including without limitation,
imputed interest in respect of capitalized lease obligations, fees in respect
of letters of credit and bankers' acceptance financing and amortization of debt
discount and expense.

          "Consolidated Net Income":  shall mean the net income of the Borrower
           -----------------------
and its Subsidiaries determined on a consolidated basis in accordance with GAAP
excluding (net of applicable taxes and expenses thereto): (i) gains in excess
of losses resulting from the sale, conversion, exchange or disposition of
capital assets (i.e., assets other than current assets) other than gains or
losses resulting from the sales of purchased or developed real property sold
for cash, cash equivalents or other property or tangible assets by the Borrower
or any Subsidiary engaged in real-estate activities in the ordinary course of
its property management and development activities; (ii) gains resulting from
the write-up of assets to the extent permitted under GAAP; (iii) losses
resulting from the write-down of impaired assets in accordance with GAAP;
(iv) equity of the Borrower or its Subsidiaries in the unremitted earnings of
any company or entity not required to be consolidated with the Borrower under
GAAP; (v) losses resulting from the write-down of intangible assets, including
goodwill, as required under GAAP; (vi) net income, gains or losses resulting
from any change in accounting, from any discontinued operations or the
disposition thereof, from any extraordinary events, from any cumulative changes
in statutory tax rates, or from any prior period adjustments, all determined in
accordance with GAAP.

          "Consolidated Net Income Before Taxes":  shall mean Consolidated Net
           ------------------------------------
Income plus the sum of all deferred and current federal, state, local and
foreign taxes that are deducted in accordance with GAAP in computing
Consolidated Net Income for such period.

          "Consolidated Net Income Before Interest, Taxes, Depreciation and
           ----------------------------------------------------------------
Amortization":  shall mean Consolidated Net Income plus the sum of all
- ------------
(i)Consolidated Interest Expense, (ii) all deferred and current federal, state,
local and foreign taxes, (iii) depreciation expenses, and (iv) amortization
expenses that are deducted in accordance with GAAP in computing Consolidated
Net Income for such period.

          "Consolidated Tangible Net Worth":  shall mean the consolidated
           -------------------------------
Shareholders Equity of the Borrower and its Subsidiaries, determined in
accordance with GAAP, less all Intangibles.

          "Consolidated Total Assets":  shall mean the Borrower's consolidated
           -------------------------
total assets, determined in accordance with GAAP.

          "Contingent Liabilities":  shall mean, (i) Indebtedness of any Person
           ----------------------
(other than the Borrower or any of its Subsidiaries) guaranteed by the Borrower
or any of its Subsidiaries, (ii) any contingent liability of the Borrower or
any of its Subsidiaries arising from any litigation that, pursuant to FASB
Statement No. 5 (or any successor thereto), is required to be reported in the
notes to the Borrower's consolidated financial statements referred to in
Section 6.1A(iii) hereof and (iii) Indebtedness of any partnership or joint
venture in which the Borrower or any of its Subsidiaries is a venturer or a
partner, for which the ratio of such partnership's or joint venture's
Indebtedness to its Consolidated Tangible Net Worth is greater than 4 to 1.

          "Controlled Group":  shall mean a "controlled group of corporations"
           ----------------
as defined in Section 1563(a) of the Code, as amended, determined without
regard to Section 1563(a)(4) and 1563(e)(3)(C) of the Code, of which the
Borrower is a part.

          "Conversion":  shall mean a conversion of a Loan into a Prime Loan or
           ----------
Eurodollar Loan, as the case may be, pursuant to Section 1.8 (including any
such conversion made as a result of the operation of the last sentence of
Section 1.7B) or Article II.

          "Conversion Date":  shall mean the date on which a conversion is, or
           ---------------
is to be, consummated, as the text may indicate.

          "Date":  shall mean, with respect to any stock redemption, retirement
           ----
or repurchase permitted under Section 7.8B, the last day of the calendar
quarter immediately preceding the calendar quarter in which such redemption,
retirement or repurchase is consummated, if the same is consummated on or
before the day on which one-half of such calendar quarter has elapsed, and the
last day of the calendar quarter in which such redemption, retirement or
repurchase was consummated, if the same was consummated after the day on which
one-half of such calendar quarter has elapsed.

          "Dollars" and "$":  shall mean lawful money of the, United States of
           -------       -
America.

          "Domestic Business Day":  shall mean a day on which the Banks and the
           ---------------------
Borrower are customarily open, at their respective addresses specified herein,
for the purpose of conducting business.

          "Effective Date" shall mean November 30, 2001.  The effective
           --------------
date of any amendment hereto shall be set forth in such amendment.

          "ERISA":  shall mean the Employee Retirement Income Security Act of
           -----
1974, as amended.

          "ERISA Affiliate" shall mean any corporation which is a member of the
           ---------------
same controlled group of corporations as the Borrower within the meaning of
section 414(b) of the Code, or any trade or business which is under common
control with the Borrower within the meaning of section 414(c) of the Code.

          "Eurodollar Business Day":  shall mean a Domestic Business Day on
           -----------------------
which dealings are carried on in the London Interbank Eurodollar Market.

          "Eurodollar Interest Period":  shall mean, as to any Eurodollar Loan,
           --------------------------
the period beginning on the Borrowing Date, Conversion Date or Extension Date,
as the case may be, for such Loan and ending one, two or three months (as the
Borrower shall request) after such Borrowing Date, Conversion Date or Extension
Date; provided, however, that if a Eurodollar Interest Period would otherwise
      --------  -------
expire on a non-Eurodollar Business Day, such Eurodollar Interest Period shall
expire on the next succeeding Eurodollar Business Day unless such day falls in
another calendar month, in which case such Eurodollar Interest Period shall
expire on the next preceding Eurodollar Business Day; and provided, further,
                                                          --------  -------
that no Eurodollar Interest Period shall extend beyond the Final Maturity Date
or shall be of such duration as to require, after giving effect to all
Eurodollar Interest Periods then in effect, the Borrower to prepay any
Eurodollar Loan in order to make the scheduled amortization payments under any
Term Note.

          "Eurodollar Loans" and "Eurodollar Loan":  shall mean, respectively,
           ----------------
(i) any Loans during any period in which such Loans bear interest at a rate
based upon the Eurodollar Rate, and (ii) a single such Loan.

          "Eurodollar Rate":  shall mean, at the time any determination thereof
           ---------------
is to be made and for any Eurodollar Interest Period, the rate per annum
(rounded up to the nearest .05%) determined by the following definition of
Libor Rate.  "Libor Rate" is the rate per annum at which the Agent is offered
deposits in Dollars by prime banks in the London Interbank Eurodollar Market as
of 11:00 a.m., London time, on the day which is two Eurodollar Business Days
prior to the beginning of such Eurodollar Interest Period, for delivery in
immediately available funds on the first day of such Eurodollar Interest
Period, in the amount of the Agent's share of proposed Loan and for a period
equal to such Eurodollar Interest Period.

          "Eurodollar Reserve Requirement":  shall mean the then maximum
           ------------------------------
effective rate per annum (expressed as a percentage) as determined by each Bank
of the reserve requirement, if any, imposed (pursuant to Regulation D) by the
Board of Governors of the Federal Reserve System on such Bank's "Eurocurrency
Liabilities" (as used in Regulation D).  Without limiting the effect of the
foregoing, the Eurodollar Reserve Requirement shall reflect any other reserves
required to be maintained by such member banks by reason of any Regulatory
Change against (i) any category of liabilities which includes deposits by
reference to which the Eurodollar Rate is to be determined as provided in the
definition of "Libor Rate" contained in the definition of "Eurodollar Rate" or
(ii) any category of extensions of credit or other assets which include
Eurodollar Loans.

          "Event of Default":  shall mean each of those events specified in
           ----------------
Section 8.1.

          "Excluded Liabilities":  shall mean indebtedness of any partnership
           --------------------
or joint venture in which the Borrower or any of its Subsidiaries is a venturer
or partner.

          "Existing Agreement":  shall have the meaning assigned to it in
           ------------------
paragraph D of the Preliminary Statements to this Agreement.

          "Extension":  shall mean an extension of a Eurodollar Loan, as the
           ---------
case may be, pursuant to Section 1.7B.

          "Extension Date":  shall mean the date on which an Extension is, or
           --------------
is to be, consummated, as the context may indicate.

          "Fees": shall mean the Facility Fees, the Restructuring Fees, the
           ----
Renewal Fees, the Letter of Credit Fees, and any all other fees due and payable
by the Borrower to the Agent and/or the Banks under this Agreement.

          "Final Maturity Date":  shall mean the date on which the fourth and
           -------------------
final installment of a Term Loan shall be due, as calculated pursuant to
Section 1.6 hereof.

          "Friendly Acquisition":  shall mean an Acquisition which is not
           --------------------
opposed by the management of the Person whose securities or assets are to be
acquired.

          "Funded Indebtedness":  of any Person shall mean the Indebtedness
           -------------------
evidenced by the Notes and all other Indebtedness which matures more than one
year from the date of its creation or matures within one year from such date
but is renewable or extendable, at the option of such Person, to a date more
than one year from such date or arises under a revolving credit or similar
agreement which obligates the lender or lenders to extend credit during a
period of more than one year from such date, excluding, however, all leases not
                                             ---------  -------
required under FASB 13 to be capitalized.

          "GAAP":  shall mean generally accepted accounting principles applied
           ----
on a basis consistent with those followed in the preparation of the financial
statements referred to in Section 6.1 unless otherwise indicated.

          "Indebtedness":  shall mean, as to the Borrower, all items of
           ------------
indebtedness which, in accordance with GAAP, would be included in determining
liabilities as shown on the liability side of a balance sheet of the Borrower
as of the date as of which indebtedness is to be determined and shall also
include all indebtedness and liabilities of others (other than the Borrower or
any of its Subsidiaries) assumed or guaranteed by the Borrower or in respect
of which the Borrower is secondarily or contingently liable (other than by
endorsement of instruments in the course of collection) whether by reason of
any agreement to acquire such indebtedness or to supply or advance sums or
otherwise, excluding, however, Contingent Liabilities and Excluded Liabilities.
           ---------  -------

          "Intangibles":  shall mean any intellectual properties, goodwill
           -----------
(including any amounts, however designated, representing the cost of
acquisition of business and investments in excess of underlying tangible
assets), unamortized debt discount and expense, deferred research and
development costs and other assets treated as intangible assets under GAAP.

          "Interest Coverage Ratio":  for any fiscal quarter shall mean, as to
           -----------------------
the Borrower, the sum of (i) the Borrower's Consolidated Net Income Before
Taxes for the four immediately preceding fiscal quarters, and (ii) the
Borrower's Consolidated Interest Expense for the four immediately preceding
fiscal quarters, divided by the Borrower's Consolidated Interest Expense for
the four immediately preceding fiscal quarters.

          "Interest Rate":  shall mean the rate or rates of interest determined
           -------------
as provided in Section 1.7.

          "Letter of Credit": shall have the meaning described in Section 1.14.
           ----------------

          "Letters of Credit Expiration Date": shall have the meaning described
           ---------------------------------
in Section 1.14.

          "Loans":  shall mean the Revolving Loans and the Term Loan as both
           -----
terms are herein defined in Sections 1.1 and 1.5, respectively.

          "London Interbank Eurodollar Market":  shall mean the London
           ----------------------------------
interbank market of Dollars for deposit.

          "Majority Banks": shall mean, at the time any determination thereof
           --------------
is to be made, (i) the holders of at least 65% of the aggregate unpaid
principal balance of the Notes and the aggregate amount of all outstanding
Letters of Credit or, if no Loans or Letters of Credit are at the time
outstanding, Banks whose Commitments aggregate at least 65% of the Total
Commitment, and (ii) the numeric majority of the Banks; provided, however,
                                                        --------  -------
in the case of a determination made by the Banks with respect to a Borrowing
pursuant to Section 2.1, the Majority Banks in such Borrowing shall mean Banks
which would make 65% of the aggregate principal amount of the Loans in such
Borrowing if such Borrowing were made as requested by the Borrower in the
Notice to the Agent requesting such Borrowing.

          "Margin Stock":  shall have the meaning assigned to it in Regulation
           ------------
U of the Board of Governors of the Federal Reserve System.

          "Matson":  shall mean the Borrower's Subsidiary, Matson Navigation
           ------
Company, Inc., a Hawaii corporation, and the subsidiaries of Matson Navigation
Company, Inc..

          "Maturity Date":  shall mean, when used with reference to any
           -------------
outstanding or requested Borrowing, a date on or before the Final Maturity
Date, as selected by the Borrower pursuant to Section 1.10, on which a
Eurodollar Interest Period shall expire.

          "Multiemployer Plan" shall mean any Plan which is a "multiemployer
           ------------------
plan" (as such term is defined in section 4001(a)(3) of ERISA).

          "Nonordinary Dividends":  shall mean dividends paid out of net income
           ---------------------
from transactions not in the ordinary course of business.  Net income from
sales of assets of the Borrower's property management and development
activities shall be deemed net income from transactions in the ordinary course
of business.

          "Normal Year":  shall mean any fiscal year of the Borrower in which
           -----------
its consolidated net income (excluding cumulative effects of accounting changes
and excluding consolidated net income derived from transactions not in the
ordinary course of business) is $20,000,000 or more and in which actual
Consolidated Tangible Net Worth is equal to or greater than Consolidated
Tangible Net Worth then permitted under Section 7.1A(i).

          "Note" or "Notes":  shall mean in the singular, a Revolving Credit
           ----      -----
Note or a Term Note, and in the plural, the Revolving Credit Notes and the Term
Notes as both terms are herein defined in Sections 1.2 and 1.6, respectively.

          "Notice":  shall mean a notice given by telex, facsimile, telegram or
           ------
telecopier, or by telephone by an authorized representative of the Borrower
(confirmed in writing promptly thereafter), which notice if from the Borrower,
is given at a time (or on a day) prior to 9:30 a.m., Hawaii Standard Time, on
the day such Notice is required or permitted.

          "Obligations":  shall mean and include all loans, advances, debits,
           -----------
liabilities, obligations, letters of credit or acceptance transactions, trust
receipt transactions, or any other financial accommodations, howsoever arising,
owing by the Borrower to the Banks, of every kind and description (whether or
not evidenced by any note or other instrument), direct or indirect, absolute or
contingent, due or to become due, now existing or hereafter in all cases
arising pursuant to the terms of this Agreement and the Notes, including,
without limitation, all interest, fees, charges, expenses, attorneys' fees and
accountants' fees chargeable to the Borrower pursuant to Section 6.5 hereof.

          "PBGC" shall mean the Pension Benefit Guaranty Corporation, or any
           ----
successor or replacement entity thereto under ERISA.

          "Person":  shall mean any natural person, corporation, firm,
           ------
association, government, governmental agency or any other entity and whether
acting in an individual, fiduciary or other capacity.

          "Plan":  shall mean any employee pension benefit plan subject to
           ----
Title IV of ERISA and maintained by the Borrower, any of its Subsidiaries, or
any member of a Controlled Group, or any such plan, to which the Borrower, any
of its Subsidiaries or any member of a Controlled Group is required to
contribute on behalf of any of its employees.

          "Prime Loans" and "Prime Loan":  shall mean respectively, (i) any
           -----------       ----------
Loans during any period in which such Loans bear interest at a rate based upon
the Prime Rate, and (ii) a single such Loan.

          "Prime Rate":  shall mean the higher of (i) the federal funds rate
           ----------
for borrowings by national banks as determined by the Agent plus one-half of
one percent (1/2%) or (ii) the lending rate of interest per annum announced
publicly by First Hawaiian Bank from time to time as its "Prime Interest Rate",
which rate shall not necessarily be the best or the lowest rate charged by
First Hawaiian Bank from time to time.  In the event that any time or times the
prime interest rate is discontinued and replaced by First Hawaiian Bank by a
comparable rate (hereinafter called the "Comparable Rate"), then for purposes
hereof, the Comparable Rate shall be substituted in place of the discontinued
rate; provided, however that if there is no replacement of the discontinued
rate by a Comparable Rate, then the discontinued rate shall be replaced by the
primary index rate from time to time established by First Hawaiian Bank for the
guidance of its lending officers in pricing commercial loans.

          "Proportional Share":  shall mean, at the time any determination
           ------------------
thereof is to be made, and when used with reference to any Bank and any
Borrowing, an amount equal to the product obtained by multiplying the amount of
such Borrowing by the following fraction:

                         Such Bank's then unused Commitment
                         ----------------------------------
                          The then unused Total Commitment.

          "Publicly Traded Securities":  shall have the meaning assigned to it
           --------------------------
in Section 220.7(a) of Regulation T of the Board of Governors of the Federal
Reserve System.

          "Regulation D":  shall mean Regulation D promulgated by the Board of
           ------------
Governors of the Federal Reserve System.

          "Regulatory Change":  shall mean, with respect to any Bank, any
           -----------------
change an or after the date of this Agreement in United States federal, state
or foreign laws or regulations (including Regulation D) or the adoption or
making on or after such date of any interpretations, directives or requests
applying to a class of banks including such Bank of or under any United States
federal or state, or any foreign, laws or regulations (whether or not having
the force of law) by any court or governmental or monetary authority charged
with the interpretation or administration thereof.

          "Regulatory Requirement":  shall mean any of the following:  any
           ----------------------
change in, or enactment of, any applicable (i) law or governmental regulation,
or (ii) governmental requirement, rule, guideline or order, or (iii)
governmental or judicial interpretation of any of the foregoing.

          "Reportable Condition": shall mean any internal control matter which
           --------------------
is required to be reported by the Borrower's independent auditor to the Audit
Committee of the Board of Directors of the Borrower in accordance with
Generally Accepted Auditing Standards.

          "Reportable Event":  shall mean a reportable event as defined in
           ----------------
Title IV of ERISA, except actions of general applicability by the Secretary of
Labor under Section 110 of ERISA.

          "Restricted Payments":  shall have the meaning specified in
           -------------------
Section 7.8A.

          "Significant Subsidiary":  shall mean any Subsidiary of the Borrower,
           ----------------------
other than McBryde Sugar Company, Ltd., the net worth of which constitutes 5%
or more of the Consolidated Tangible Net Worth of the Borrower.

          "Subsidiary":  shall mean, as to the Borrower, any other company,
           ----------
whether operating as a corporation, joint venture, partnership, limited
liability company or other entity, which is consolidated with the Borrower in
accordance with GAAP.

          "Taxes":  shall mean taxes, levies, imposts, duties or other charges
           -----
of whatsoever nature imposed by any government or any political subdivision or
taxing authority thereof, other than any such charges on or measured by the net
income, net worth or shareholders, capital of a Bank pursuant to the income tax
laws of the jurisdiction where such Bank's principal or lending office is
located.

          "Termination Date":  shall mean November 30, 2004, or the Date to
           ----------------
which such date is extended from time to time as provided in Section 1.1B
hereof.

          "Transferred Assets":  shall have the meaning assigned to it in
           ------------------
paragraph B of the Preliminary Statements to this Agreement.

          "Unmatured Event of Default":  shall mean an event, act or occurrence
           --------------------------
which with the giving of notice or the lapse of time, or with both thereof,
would become an Event of Default, other than Events of Default described in
Section 8.1D.

          Section 9.2  Accounting Terms.  All accounting terms not specifically
                       ----------------
defined herein shall be construed in accordance with GAAP consistent with those
applied in the preparation of the financial statements referred to in Section
4.5 hereof, and all financial data submitted pursuant to this Agreement shall
be prepared in accordance with such principles.


ARTICLE X - PARTICIPATIONS; SETOFFS
- -----------------------------------

          Each Bank may sell participations in all or any part of any Loan or
Loans made by it to another bank or other entity without the consent of any
other party hereto, in which event the participant shall not have the rights
under this Agreement or such Bank's Note (the participant's rights against such
Bank in respect of such participation to be those set forth in the agreement
executed by such Bank in favor of the participant relating thereto) and all
amounts payable by the Borrower under Articles I and II hereof shall be
determined as if such Bank had not sold such participation.  In addition, each
Bank shall have the right at any time to sell, assign, transfer, or negotiate
all or part of the Obligations of the Borrower outstanding under this Agreement
or its Notes evidencing such Obligations to such Bank, and the Borrower hereby
acknowledge and agree that any such disposition will give rise to a direct
obligation of the Borrower to the assignee and the assignee shall for all
purposes, where relevant, hereof be considered to be a Bank; provided, however,
                                                             --------  -------
that no assignment with respect to Loans maturing more than 180 days after the
date of such assignment shall be effective without the prior written consent of
the Borrower, which consent shall not be unreasonably withheld; and provided
                                                                    --------
further that, with respect to assignments of Loans maturing 180 days or less
- -------
after the date of such assignment undertaken without the consent of the
Borrower, all amounts payable by the Borrower under Articles I and II shall be
determined as though such assignment had not occurred.  The Borrower hereby
authorizes each such assignee, each Bank and each participant in case of
default by the Borrower hereunder to proceed directly by right of setoff,
banker's lien or otherwise against any assets of the Borrower which may at the
time of such default be in the hands of such Bank or such participant to the
full extent of its interest in the Obligations.

ARTICLE XI - RIGHTS AND DUTIES OF THE AGENT AND THE BANKS
- ---------------------------------------------------------

          Section 11.1  Obligations Several.  The obligations of the Banks
                        -------------------
hereunder shall be several and the failure of one Bank to perform hereunder
shall not relieve any other Bank from such other Bank's obligation to perform,
nor shall such other Bank be required to increase its obligation hereunder.

          Section 11.2  Appointment and Duties of Agent; Agent's Fee.  The
                        --------------------------------------------
parties hereto agree that First Hawaiian Bank, a Hawaii corporation shall act,
subject to the terms and conditions of this Article XI, as the Agent for the
Banks, and to the extent set forth herein each of the Banks hereby irrevocably
appoints, authorizes, empowers and directs the Agent to take such action on its
behalf and to exercise such powers as are specifically delegated to the Agent
herein in connection with the administration and enforcement of any rights or
remedies with respect to this Agreement and the Notes.  The general
administration of the Loans and Letters of Credit hereunder shall be with the
Agent.  It is expressly understood and agreed that the obligations of the Agent
hereunder are only those expressly set forth in this Agreement.  The Agent
shall use reasonable diligence to examine the face of each document received by
it hereunder to determine whether such document, on its face, appears to be
what it purports to be.  However, the Agent shall not be under any duty to
examine into or pass upon the validity or genuineness of any documents received
by it hereunder and the Agent shall be entitled to assume that any of the same
which appears regular on its face is genuine and valid and what it purports to
be.

          In consideration of the Agent's assumption of the duties and
obligations as Agent hereunder, the Borrower shall pay to the Agent an Agent's
Fee to be agreed to by and between the Borrower and the Agent.  The Agent's Fee
shall be for the benefit of and payable to the Agent only and shall not be
shared with any of the Banks.

          Section 11.3  Discretion and Liability of Agent.  Subject to Sections
                        ---------------------------------
11.4 and 11.6 hereof, the Agent shall be entitled to use its discretion with
respect to exercising or refraining from exercising any rights which may be
vested in it under this Agreement or otherwise, or with respect to taking or
refraining from taking any action or actions which it may be able to take under
this Agreement.  Neither the Agent nor any of its directors, officers,
employees, agents or representatives shall be liable to any Bank for any action
taken or omitted by them hereunder or in connection herewith, except for its or
their own gross negligence or willful misconduct.   The Agent shall incur no
liability under, or in respect of, this Agreement, by acting upon a notice,
certificate, warranty or other paper or instrument believed by it to be genuine
or authentic or to be signed by the proper party or parties, or with respect to
anything which it may do or refrain from doing in the reasonable exercise of
its judgment, or which may seem to it to be necessary or desirable in the
premises.

          Section 11.4  Event of Default.  The Agent shall be entitled to
                        ----------------
assume that no Event of Default or Unmatured Event of Default, or both, has
occurred and is continuing, unless the Agent has actual knowledge of such facts
or has received notice from a Bank in writing that such Bank considers that an
Event of Default or an Unmatured Event of Default has occurred and is
continuing and which specifies the nature thereof.

          In the event that the Agent shall acquire actual knowledge of any
Event of Default or Unmatured Event of Default or both, the Agent shall
promptly notify (either orally or in writing) the Banks of such Event of
Default or Unmatured Event of Default and may, or if requested in writing by
the Majority Banks shall, take such action and assert such rights as are
contemplated under this Agreement.  The Agent shall be indemnified pro rata by
the Banks against any liability or expenses, including reasonable counsel fees,
incurred in connection with taking such action.

          Section 11.5  Consultation.  The Agent in good faith may consult with
                        ------------
legal counsel or an accountant selected by it and shall be entitled to rely
fully upon any opinion of such counsel or accountant in connection with any
action taken or suffered by Agent in accordance with such opinion.

          Section 11.6  Communications to and from Agent.  Whenever any notice,
                        --------------------------------
approval, consent, waiver, or other communication or action is required or may
be delivered by the Banks hereunder, action by the Agent shall be effective for
all purposes hereunder; provided, that upon any occasion requiring or
                        --------
permitting an approval, consent, waiver, election or other action on the part
of the Banks, unless action by the Agent alone is expressly permitted
hereunder, action shall be taken by the Agent for and on behalf or for the
benefit of all the Banks upon the direction of the Majority Banks or all of
the Banks, as applicable.  The Borrower may rely on any communication from the
Agent hereunder and need not inquire into the propriety of or authorization for
such communication.  Upon receipt by the Agent from the Borrower or any Bank of
any communication calling for an action on the part of the Banks, the Agent
will, in turn, promptly inform the other Banks in writing of the nature of such
communication.

          Section 11.7  Limitations of Agency.  Notwithstanding anything in
                        ---------------------
this Agreement or any of the other related documents, expressed or implied, it
is agreed by the parties hereto that the Agent will act hereunder and under the
related documents as Agent solely for the Banks and only to the extent
specifically set forth herein, and will, under no circumstances, be considered
to be an agent or fiduciary of any nature whatsoever in respect of any other
Person.  The Agent may generally engage in any kind of banking or trust
business with the Borrower as if it were not the Agent and shall include its
own pro rata share of the Total Commitment in all calculations hereunder, with
respect to which pro rata share it may act or omit to act as if it were not the
Agent.

          Section 11.8  No Representation or Warranty.  No Bank (including the
                        -----------------------------
Agent) makes to any other Bank any representation or any warranty, express or
implied, or assumes any responsibility with respect to the Loans or the
execution, construction or enforceability of this Agreement, the Notes or any
instrument or agreement executed by the Borrower or any other Person in
connection herewith.

          Section 11.9  Bank Credit Decision.  Each Bank acknowledges that it
                        --------------------
has, independent of and without reliance upon any other Bank (including the
Agent) or any information provided by any other Bank (including the Agent) and
based on the financial statements of the Borrower and such other documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement.  Each Bank also acknowledges that it
will, independent of and without reliance upon any other Bank (including the
Agent) and based on such documents and information as it shall deem appropriate
at that time, continue to make its own credit decisions in taking or not taking
action under this Agreement and any other documents relating hereto.

          Section 11.10  Indemnity.  Notwithstanding any of the provisions
                         ---------
hereof, the Banks (up to the amount of their respective Commitments) shall
severally indemnify the Agent against loss, cost, liability, damage or expense,
including attorneys' fees, arising from or in connection with its duties as
Agent hereunder and not caused by its gross negligence or willful misconduct,
to the extent the Agent does not recover such losses, costs, liabilities,
damages or expenses from the Borrower.

          Section 11.11  Resignation.  The Agent may resign as such at any time
                         -----------
upon at least thirty (30) days' prior notice to the Borrower and the Banks,
provided that such resignation shall not take effect until a successor agent
has been appointed.  In the event of such resignation, the Majority Banks
shall, as promptly as practicable, appoint a successor agent, and if they fail
to do so within thirty (30) days after such notice the Agent may appoint a
successor agent.

          Section 11.12  Note Holders.  The Agent may treat the payee of any
                         ------------
Note as the holder thereof until written notice of transfer shall have been
filed with the Agent signed by such payee and in form satisfactory to the
Agent.

          Section 11.13  Co-Agent.  The Bank identified on the facing page or
                         --------
signature pages of this Agreement as a "co-agent" shall not have any right,
power, obligation, liability, responsibility or duty under this Agreement other
than those applicable to all Banks as such.  Without limiting the foregoing,
the Bank so identified as a "co-agent" shall not have or be deemed to have any
fiduciary relationship with any Bank.  Each Bank acknowledges that it has not
relied, and will not rely, on the Bank so identified in deciding to enter into
this Agreement or in taking or not taking action hereunder.


ARTICLE XII - MISCELLANEOUS
- ---------------------------

          Section 12.1  Entire Agreement.  This Agreement with the Schedule and
                        ----------------
Exhibits attached hereto embodies the entire agreement and understanding
between the parties hereto and supersedes all prior agreements and under-
standings relating to the subject matter hereof.

          Section 12.2  No Waiver.  No failure to exercise, and no delay in
                        ---------
exercising, any right, power or remedy hereunder or under any document
delivered pursuant hereto shall impair any right, power or remedy which the
Banks or the Borrower may have, nor shall any such delay be construed to be a
waiver of any of such rights, powers or remedies, or an acquiescence in any
breach or default under this Agreement of any document delivered pursuant
hereto, nor shall any waiver by the Banks or the Borrower, respectively, of any
breach or default of the Borrower or the Banks, respectively, hereunder be
deemed a waiver of any default or breach subsequently occurring.  The rights
and remedies herein specified are cumulative and not exclusive of any rights or
remedies which the Banks or the Borrower would otherwise have.

          Section 12.3  Survival.  All representations, warranties and
                        --------
agreements herein contained on the part of the Borrower and the Banks shall
survive the making of the Loans hereunder and all such representations,
warranties and agreements shall be effective as long as any Obligation arising
pursuant to the terms of this Agreement remains unpaid.

          Section 12.4  Notices.  All Notices, requests, consents and demands
                        -------
hereunder shall be effective when duly deposited in the mails, postage prepaid,
or delivered by telegraph or transmitted by telex, facsimile or telecopier,
addressed to the respective party at the address set forth below, except that
Notices to the Agent pursuant to Article I shall not be effective until
received.

                    Borrower:   Alexander & Baldwin, Inc.
                    --------    822  Bishop Street
                                Honolulu, HI 96813
                                Attention: Mr. James S. Andrasick
                                           Chief Financial Officer
                                Telephone: (808) 525-8404
                                Facsimile: (808) 525-6651


                       Agent:   First Hawaiian Bank
                       -----    Main Banking Center
                                999 Bishop Street, 2nd Floor
                                Honolulu, Hawaii 96813
                                Attention:  Mr. Lance Mizumoto
                                            Vice President
                                Telephone: (808) 525-6132
                                Facsimile: (808) 525-8921

                   The Banks:   At the addresses indicated on the
                   ---------    signature pages below or, if modified, on the
                                signature pages of any amendment or supplement
                                hereto.

Any of the above may change such address by Notice in writing given to the
other parties to this Agreement.

          Section 12.5  Termination.  This Agreement shall terminate when all
                        -----------
Obligations of the Borrower incurred hereunder shall have been discharged in
full.

          Section 12.6  Separability of Provisions.  In case any one or more of
                        --------------------------
the provisions contained in this Agreement should be invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein shall not in any way be affected or
impaired thereby.

          Section 12.7  Successors and Assigns.  This Agreement shall be
                        ----------------------
binding upon and inure to the benefit of the Borrower, the Banks and their
respective successors and assigns; provided, that the Borrower may not transfer
its rights to borrow under this Agreement without prior written consent of the
Banks.

          Section 12.8  Counterparts.  This Agreement may be executed in any
                        ------------
number of counterparts, all of which taken together shall constitute one
agreement, and any party hereto may execute this Agreement by signing any such
counterpart.

          Section 12.9  Choice of Law.  This Agreement shall be governed by and
                        -------------
construed in accordance with the laws of the State of Hawaii.

          Section 12.10  Amendment and Waiver.  No provision, of this Agreement
                         --------------------
or the Notes may be amended, modified, supplement, changed, waived, discharged
or terminated, unless the Majority Banks and the Borrower consent thereto in
writing; provided, however, that no such amendment, modification, supplement or
         --------  -------
change shall modify any of the provisions of this Agreement or the Notes with
respect to an Event of Default or the amount of or time for the payment of the
principal of and interest on the Notes, or reduce the percentage of Banks
required to comprise the "Majority Banks," without the consent of the holders
of all the Notes then outstanding, or, if no Notes are at the time outstanding,
all of the Banks.

          Section 12.11  Indemnification by the Borrower.  The Borrower agrees,
                         -------------------------------
whether or not any Acquisition is consummated, to indemnify, pay and hold the
Agent, each Bank, and the officers, directors, employees and agents of the
Agent and the Banks, harmless from and against any and all claims, liabilities,
losses, damages, costs and expenses, including, without limitation, reasonable
attorneys' fees, arising out of or connected in any way with any Acquisition or
proposed Acquisition, including, without limitation, any liabilities arising
out of or connected in any way with violations, alleged or actual, of any state
or federal securities laws applicable to any Acquisition or proposed
Acquisition (collectively, the "Indemnified Liabilities"), provided that the
Borrower shall have no obligation hereunder with respect to Indemnified
Liabilities to the extent the same arise from the gross negligence or willful
misconduct of any such indemnified Persons.

          If any claim is made, or any action, suit or proceeding is brought,
against any Person indemnified pursuant to this Section 12.11, the indemnified
Person shall notify the Borrower of such claim or of the commencement of such
action, suit or proceeding, and the Borrower will, if so requested by the
indemnified Person, assume the defense of such action, suit or proceeding,
employ counsel reasonably satisfactory to the indemnified Person and pay the
fees and expenses of such counsel.

          The Obligations of the Borrower under this Section 12.11 shall
survive the payment of the Loans and the cancellation of the Notes.

          IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed as of the day and year first above written.


                             ALEXANDER & BALDWIN, INC.


                             By /s/ James S. Andrasick
                                -------------------------------------
                                JAMES S. ANDRASICK
                                Its Senior Vice President,
                                  Chief Financial Officer and
                                  Treasurer


                             By /s/ Thomas A. Wellman
                                -------------------------------------
                                THOMAS A. WELLMAN
                                Its Controller and
                                  Assistant Treasurer

<p Style="page-break-after:always">


                          CERTIFICATE OF FIRST HAWAIIAN BANK

                                    AS AGENT


     This certificate is delivered pursuant to the provisions of Section 3.3 of
the Third Amended and Restated Revolving Credit and Term Loan Agreement
effective as of November 30, 2001, between Alexander & Baldwin, Inc. (the
"Borrower"), First Hawaiian Bank, Bank of America N.A., Bank of Hawaii, The
Bank of New York, Well Fargo Bank, National Association, and American Savings
Bank, F.S.B. (the "Banks"), and First Hawaiian Bank, as agent for the Banks
("Agent").  On behalf of the Banks, the Agent hereby certifies to the Borrower
that (i) the conditions specified in Section 3.2 of the Agreement have been
satisfied, (ii) the Agreement is therefore effective as of November 30, 2001,
and (iii) the Borrower need take no further action to satisfy any of the
conditions specified in Section 3.2 as a condition to any Borrowing, except
that on or before delivery by the Borrower to the Agent of each Notice of
Borrower pursuant to Section 1.10 of the Agreement there shall be delivered to
the Agent a duly certified copy of a resolution of the Board of the Borrower
approving such Borrowing, provided that no such certificate shall be required
as to a Borrowing which is a refinancing of a Eurodollar Loan.

                             Dated:  November 30, 2001

                             FIRST HAWAIIAN BANK,
                             as Agent


                             By /s/ Lance A. Mizumoto
                                ---------------------------
                                Its Vice President

<p Style="page-break-after:always">


                             FIRST HAWAIIAN BANK,
                             individually and as Agent
                             Main Banking Center
                             999 Bishop Street, 2nd Floor
                             Honolulu, Hawaii  96813
                             Att'n: Mr. Lance Mizumoto
                                       Vice President
                             Telephone: (808) 525-6132
                             Facsimile:  (808) 525-7173


                             By /s/ Lance A. Mizumoto
                                ---------------------------
                                Its Vice President



                             BANK OF AMERICA, N.A.
                             WA1-501-35-01
                             800 Fifth Avenue, 35th Floor
                             Seattle, Washington  98104
                             Att'n:   Ms. Nancy Nuerenberg
                               Senior Vice President, Commercial Banking
                             Telephone: (206) 358-6279
                             Facsimile:  (206) 585-1794


                             By /s/ Nancy Nuerenberg
                                ---------------------------
                                Its Senior Vice President



                             BANK OF HAWAII
                             130 Merchant Street, 20th Floor
                             Honolulu, Hawaii  96813
                             Att'n:  Ms. Dana-Ann Takushi
                                         Vice President
                             Telephone: (808) 537-8689
                             Facsimile: (808) 537-8301


                             By  /s/ Dana Takushi
                                 --------------------------
                                 Its Vice President



                             THE BANK OF NEW YORK
                             10990 Wilshire Boulevard
                             Suite 1125
                             Los Angeles, California  90024
                             Att'n:   Ms. Jennifer Ellerman
                               Vice President
                             Telephone: (310) 996-8677
                             Facsimile:  (310) 996-8667


                             By  /s/ Jennifer Ellerman
                                 --------------------------
                                 Its Vice President




                             WELLS FARGO BANK, NATIONAL ASSOCIATION
                             420 Montgomery MAC A0101-096
                             San Francisco, California 94104
                             Attn: Mr. Robert O'Sullivan
                               Relationship Manager
                             Telephone: (415) 222-2951
                             Facsimile:  (415) 421-1352


                             By  /s/ Robert O'Sullivan
                                 --------------------------
                                 Its Relationship Manager



                             AMERICAN SAVINGS BANK, F. S. B.
                             915 Fort Street Mall, 4th Floor
                             Honolulu, Hawaii 96813
                             Attn: Mr. Carl A. Morita
                             Telephone: (808) 539-7631
                             Facsimile:   (808) 536-1169


                             By  /s/ Carl A. Morita
                                 --------------------------
                                 Its Vice President


<p Style="page-break-after:always">

                                  SCHEDULE I



                                                  Commitment
                                                  ----------

     First Hawaiian Bank                         $ 45,000,000
     Bank of America, N.A.                         40,000,000
     Wells Fargo Bank, National Association        40,000,000
     Bank of Hawaii                                30,000,000
     The Bank of New York                          20,000,000
     American Savings Bank, F. S. B.               10,000,000
                                                 ------------
                                                 $185,000,000



<p Style="page-break-after:always">

                                   EXHIBIT A

                             REVOLVING CREDIT NOTE


$__________________                                           Honolulu, Hawaii

                                                   ___________________, ______

          ALEXANDER & BALDWIN, INC., a Hawaii corporation (hereafter referred
to as the "Borrower"), FOR VALUE RECEIVED, hereby promises to pay to the order
of _______________________________ (the "Payee") at the offices of First
Hawaiian Bank, a Hawaii Corporation located at 999 Bishop Street, Honolulu,
Hawaii, 96813, the principal sum of ____________________________ DOLLARS
($_____________), on the Termination Date (as defined in the Agreement referred
to below) in lawful money of the United States of America and
in immediately available funds.

          The Borrower promises also to pay interest on the unpaid principal
amount thereof in like money and funds at said office from the date hereof
until paid at the rates per annum which will be determined in accordance with
the provisions of Article I and Article II of the Third Amended and Restated
Revolving Credit and Term Loan Agreement (the "Agreement") effective as of
__________________, among the Borrower, the Payee and the other banks party
thereto, said interest to be payable at the times provided for in the
Agreement.

          This Note is one of the Notes referred to in the Agreement and is
entitled to the benefits thereof.  This Note is subject to prepayment, in whole
or in part, as specified in the Agreement.  In case an Event of Default, as
defined in the Agreement, shall occur and shall be continuing, the principal of
and accrued interest on this Note may become due and payable in the manner and
with the effect provided in the Agreement.

          The Borrower hereby waives presentment, demand, protest or notice of
any kind in connection with this Note.

          This Note shall be governed by and construed in accordance with the
laws of the State of Hawaii.

                             ALEXANDER & BALDWIN, INC.


                             By ____________________________

                                  Its ______________________


                             By ____________________________

                                  Its ______________________




<p Style="page-break-after:always">


                          LOAN AND REPAYMENT SCHEDULE
                             REVOLVING CREDIT NOTE
                             ---------------------
_______________________________________________________________________________

              (Use this section when evidencing a Eurodollar Loan)

                                EURODOLLAR LOANS
                                ----------------
_______________________________________________________________________________


                                          Amount and
                                          date of
                                          Principal
                                          Repayment     Amount and
                                          (including    date of
      When                    Maturity    amounts       Interest       Notation
Rate  Made  Term    Amount    Date        converted)    Payment        Made By
_______________________________________________________________________________












_______________________________________________________________________________

               (Use this section when evidencing Prime Rate Loan)

                                PRIME RATE LOANS
                                ----------------
_______________________________________________________________________________


                                          Amount and
                                          date of
                                          Principal
                                          Repayment     Amount and
                                          (including    date of
      When                    Maturity    amounts       Interest       Notation
Rate  Made  Term    Amount    Date        converted)    Payment        Made By
_______________________________________________________________________________



<p Style="page-break-after:always">

                                   EXHIBIT B

                                   TERM NOTE

$___________________                                          Honolulu, Hawaii
                                                     _______________, ________


          ALEXANDER & BALDWIN, INC., a Hawaii corporation (hereafter referred
to as the "Borrower"), for value received, hereby promises to pay to the order
of ________________________(the "Payee") at the offices of FIRST HAWAIIAN BANK,
a Hawaii corporation, located at 999 Bishop Street, Honolulu, Hawaii, 96813,
the principal sum of _______________________ Dollars ($____________), in lawful
money of the United States of America and in immediately available funds, in
four consecutive substantially equal quarterly installments of $_____________,
which installments shall be payable on the last Business Day of September,
December, March and June, commencing _____________, ______; provided, however,
that the last such installment shall be in an amount sufficient to repay in
full the unpaid principal amount; and to pay interest from the date hereof on
said principal sum, or the unpaid balance thereof, in like money and funds,
at said office, at the rates per annum which shall be determined in accordance
with the provisions of Articles I and II of the Agreement referred to below,
said interest to be payable at the times provided for in the Agreement.

          This Note is one of the Term Notes referred to in the Third Amended
and Restated Revolving Credit and Term Loan Agreement (the "Agreement")
effective as of ________________, among the Borrower, the Payee, and the other
banks party thereto, and is entitled to all the benefits provided therein.
Reference is made to said Agreement for the rights and obligations of the
Borrower, the Payee (as one of the "Banks" defined therein), and First Hawaiian
Bank, as Agent, with regard to this Note.

          This Note is subject to prepayment, in whole or in part, as specified
in the Agreement.  In case an Event of Default, as defined in the Agreement,
shall occur and shall be continuing, the principal of and accrued interest on
this Note may become due and payable in the manner and with the effect provided
in the Agreement.

          The Borrower hereby waives presentment, demand, protest or notice of
any kind in connection with this Note.

          This Note shall be governed by and construed in accordance with the
laws of the State of Hawaii.

                             ALEXANDER & BALDWIN, INC.


                             By ____________________________

                                  Its ______________________


                             By ____________________________

                                  Its ______________________





<p Style="page-break-after:always">

                                   EXHIBIT C

                       CERTIFICATE OF FIRST HAWAIIAN BANK

                                    AS AGENT


     This certificate is delivered pursuant to the provisions of Section 3.3 of
the Third Amended and Restated Revolving Credit and Term Loan Agreement
effective as of _______________, between Alexander & Baldwin, Inc. (the
"Borrower"), First Hawaiian Bank, Bank of America N.A., Bank of Hawaii, The
Bank of New York, Well Fargo Bank, National Association, and American Savings
Bank, F.S.B. (the "Banks"), and First Hawaiian Bank, as agent for the Banks
("Agent").  On behalf of the Banks, the Agent hereby certifies to the Borrower
that (i) the conditions specified in Section 3.2 of the Agreement have been
satisfied, (ii) the Agreement is therefore effective as of _________________,
and (iii) the Borrower need take no further action to satisfy any of the
conditions specified in Section 3.2 as a condition to any Borrowing, except
that on or before delivery by the Borrower to the Agent of each Notice of
Borrower pursuant to Section 1.10 of the Agreement there shall be delivered
to the Agent a duly certified copy of a resolution of the Board of the Borrower
approving such Borrowing, provided that no such certificate shall be required
as to a Borrowing which is a refinancing of a Eurodollar Loan.

                              Dated: _______________________.

                              FIRST HAWAIIAN BANK,
                              as Agent


                              By ___________________________

                                   Its Vice President





<p Style="page-break-after:always">

                                  EXHIBIT D

                      LETTER OF CREDIT APPLICATION FORM

<p Style="page-break-after:always">

                                                       BANK USE ONLY
                                                       L/C No. ______
                              FIRST HAWAIIAN BANK

                         APPLICATION AND AGREEMENT FOR
                            STANDBY LETTER OF CREDIT


To: First Hawaiian Bank
_______________ Branch
_______________, Hawaii                                Date __________________

Please issue an Irrevocable Standby Letter of Credit on substantially the same
terms and conditions as shown in this application for delivery to the
beneficiary by:

/ / Airmail   / / Airmail with short preliminary cable advice   / / Full Cable
/ / Courier   / / Other

______________________________________________________________________________
                                     |
            ADVISING BANK            |        FOR ACCOUNT OF (APPLICANT)
    (If Blank, Correspondent Bank)   |
                                     |
                                     |
                                     |
                                     |
_____________________________________|________________________________________
      IN FAVOR OF (BENEFICIARY)      |                   AMOUNT
                                     |
                                     |
                                     |
                                     |_________________________________________
                                     |          EXPIRY DATE AND PLACE
                                     |             FOR PRESENTATION
                                     |
                                     | Date
                                     |  Automatic Extension: / /Yes   / / No
                                     |  Place:  FHB's International Banking
                                     |          offices, Honolulu, unless
                                     |          otherwise specified.
______________________________________________________________________________

Available for payment by presentation of draft(s) at sight drawn on you or your
correspondent.
Please issue the Letter of Credit as per attached.

FEES:
Issuing Fee $____ Initial Standby Fee at the rate of __% per annum (360 days
per year).
                 Minimum $___________/Year
                 (Subject to adjustment in the event of extension or increase.)

Payment Fee ___________%, or minimum $___________, whichever is greater.  Plus
other applicable fees (telex, courier, fax, etc.)

Partial Drawings PERMITTED unless otherwise stated




By signing below, applicant acknowledges that applicant has read and agrees to
all of the above terms and conditions and the Agreement Governing Standby
Letter of Credit on the reverse side.

The applicant authorizes Bank to charge applicant's checking account number
_________ maintained by the applicant with Bank at its _____________ Branch,
for any and all amounts due from applicant to Bank under this Agreement.  In
the event said checking account does not have sufficient funds to reimburse
Bank for the amounts due hereunder, the applicant will pay such amounts on
demand, as specified in this Agreement.  This authorization will remain in full
force and effect until revoked by the applicant in writing.  However, any such
revocation by the applicant shall not affect or impair Bank's rights and
remedies set forth in this Agreement.

________________________________      ____________________________________
Date                                  Authorized Signature        Title

________________________________      ____________________________________
Applicant - Firm Name                 Authorized Signature        Title


_______________________________________________________________________________

                                BANK USE ONLY
_______________________________________________________________________________
                             |
Outstanding Balance _______  | The Letter of Credit is approved under one of
                             | the following:
                             | / / Executive Committee   / / BLAD Authority
Amount Requested __________  | / / My Lending Authority  / / Credit Committee
                             | / / Other _______________
          TOTAL ___________  |
                             |
                             |     Under Line of Credit No. ___________
                             |     Applicant's Obligor No. ____________
                             |
Security __________________  |     Type: / / Financial   / / Performance
                             |
                             |     Grade ____   Approved By _______________
_____________________________|_________________________________________________

<p Style="page-break-after:always">


                 AGREEMENT GOVERNING STANDBY LETTERS OF CREDIT

          First Hawaiian Bank (herein called "Bank") and the applicant(s)
(herein called the "applicant") for Standby Letter of Credit (herein called the
"Credit") agrees as set forth on the application as follows:

          1.   As to drafts or other requests for payment drawn under or
purporting to be drawn under the Credit, the applicant will reimburse, or pay
in advance to Bank in U.S. currency at Bank's election and on demand, the
amount paid on or required to pay each sight draft payable in U.S. currency,
and as to such drafts payable in other than U.S. currency, to reimburse Bank,
on demand, the equivalent of the amount paid (plus cable charges) in U.S.
currency at the current rate of exchange in Hawaii for cable transfers, to the
place of payment in the currency in which such draft is drawn. If there is a
note executed by the applicant in connection herewith, the note evidences the
debt due hereunder.

          2.   The applicant will pay Bank all fees specified on the
application and/or in a separate agreement.

          3.   As security for the payment of all obligations and indebtedness
of the applicant to Bank, now or hereafter existing under this Agreement, the
applicant hereby (a) pledges to Bank and/or gives Bank a general lien upon
and/or right of set-off against all right, title, and interest of the applicant
in and to the balance of every deposit account now or at any time hereafter
existing, of the applicant with Bank, and any other claims of applicant against
Bank, and in and to all property, claims, and demands and rights and interests
therein of the applicant, and in and to all evidences thereof, which have been
or at any time shall be delivered to or otherwise come into Bank's possession,
custody or control, or into the possession, custody or control of any of its
agents or correspondents for any purpose, whether or not for the express
purpose of being used by Bank as collateral security or for safekeeping or for
any other or different purposes, it being understood that the receipt at any
time by Bank, or any of its correspondents, of other security, of whatever
nature, including cash, shall not be deemed a waiver of any of Bank's rights or
powers under this Agreement, (b) if any party shall have joined in the
application for the Credit, assigns and transfers to Bank all right, title, and
interest of the applicant in and to all property and interests which the
applicant may now or hereafter obtain from such party as security for the
obligations of such party arising in connection with the transaction to which
the Credit relates; and (c) agrees at any time and from time to time, on
demand, to deliver, convey transfer, or assign to Bank additional security of
value and character satisfactory to Bank, or to make such payment as Bank may
require.

          4.   Upon demand by Bank, applicant will execute and deliver to Bank
all documents concerning security to be given or granted Bank, all in form and
content applicable to Bank and shall pay Bank all applicable filing fees
therefor.

          5.   Until and except as the applicant shall instruct Bank in writing
to the contrary, Bank and its correspondents may, but shall have no obligation
to, under the Credit, (a) receive and accept and pay drafts or other documents
and instruments otherwise in order signed by, or issued to, the receiver,
successor in interest, trustee in bankruptcy, personal representative,
administrator, guardian or conservator of anyone named in the Credit as the
person to whom drafts and other documents and instruments are to be drawn or
issued; and (b) honor drafts for partial payments whether or not made in any
designated amount or period of time, provided that the liability of the
applicant to reimburse Bank shall not exceed the amount to the Credit plus all
applicable charges, expenses, and interest.

          6.   The users of the Credit shall be deemed agents of the applicant.
Neither Bank nor Bank's correspondents shall have any liability or
responsibility for tile correctness, validity, genuineness, sufficiency, or
falsification of any documents or instruments, or for any delay in giving or
failure to give notice, or for failure of any person to comply with the terms
of the Credit, or for errors, omissions, delays in or nondelivery of any
message, however sent, or for any other error, neglect, or omission if done in
good faith, and any action taken in good faith by Bank and Bank's
correspondents shall be binding on the applicant.

          7.   Any and all payments made to Bank hereunder shall be made free
and clear of and without deduction for any present or future taxes, levies,
imposts, deductions, charges, or withholdings, and all liabilities with respect
thereto, excluding taxes imposed on net income and all income and franchise
taxes of the United States and any political subdivisions thereof (all such
non-excluded taxes, levies, imposts, deductions, charges, withholdings, and
liabilities being hereinafter called "Taxes"). If the applicant shall be
required by law to deduct any taxes from or in respect of any sum payable
hereunder, (a) the sum payable shall be increased as may be necessary so that
after making all required deductions (including deductions applicable to
additional sums payable under this section 7) Bank shall receive an amount
equal to tile sum Bank would have received had no such deductions been made;
(b) the applicant shall make such deductions; and (c) the applicant shall pay
the full amount deducted to the relevant taxation authority or other authority
in accordance with applicable law. The applicant will indemnify Bank for the
full amount of Taxes (including, without limitation, any Taxes imposed by any
jurisdiction on amounts payable under this section 7) paid by Bank and any
liability (including penalties, interest, and expenses) arising therefrom or
with respect thereto, whether or not such Taxes were correctly or legally
asserted. This indemnification shall be made within 30 days from the date Bank
makes written demand therefor. Within 30 days after the date of any payment of
Taxes, the applicant will furnish to Bank the original or a certified copy of a
receipt evidencing payment thereof.

          8.   Any property of the applicant of whatever kind or character now
or hereafter in Bank's possession or under Bank's control is security for the
payment and performance of all of the applicant's indebtedness and obligations
to Bank and may, without notice to the applicant, be applied to the same by
Bank, and applicant will, upon demand, execute and deliver to Bank a security
agreement in Bank's regular form. Should the applicant default in payment or
performance of any of the terms hereof or of the Credit or any other agreements
with Bank, or discontinue its present business, become incompetent or
insolvent, die, institute any proceedings seeking to adjudicate the applicant
as bankrupt or insolvent, make an assignment for the benefit of creditors or
become the subject of any receivership or other proceedings under the
bankruptcy laws, or give any materially false information to, or withhold any
essential financial information from Bank, or should the property, goods,
documents, and instruments referred to in section 3 of this Agreement be
attached, seized, impounded, or become subject to any other legal process or
order, then upon the happening of any such events, Bank without the necessity
of any notice, demand, or protest to or upon the applicant or any other person,
may do any or all of the following: (a) declare all indebtedness owing from the
applicant to Bank immediately due and payable; (b) take possession of the
property, goods, documents, and instruments or any part thereof, and do all
such acts affecting the same as Bank may deem necessary to conserve the same
and its security interest therein; (c) apply all property of the applicant to
said indebtedness; (d) set off and apply all deposits at any time held or other
indebtedness at any time owing by Bank to or for the credit or the account of
the applicant against any amounts owing by the applicant to Bank; (e) take
possession of the property, goods, documents, and instruments, or any part
thereof, with or without process of law, and sell and dispose of the same at
public or private sale; and (f) exercise all rights under the Uniform
Commercial Code, Chapter 490, Hawaii Revised Statutes, or any other applicable
law. To the extent notice of sale shall be required by law, reasonable notice
shall include, but shall not be limited to, written notice to the applicant at
the address shown on the reverse hereof at least five business
days prior to the date of sale. Bank may purchase at such sale free from any
right of redemption, which the applicant hereby waive(s) and release(s). Bank
in conducting such sale may act through an agent, its attorney, or any of its
officers. The applicant will pay Bank all expenses of taking possession,
storing, transporting, conditioning, sale and collection, including reasonable
attorneys' fees, and Bank may deduct the same from the proceeds of any sale
before crediting the balance, if any, to the indebtedness of the applicant.
Upon demand, the applicant will pay to Bank any deficiency, and Bank will pay
to the applicant any surplus remaining after the application of the proceeds of
the sale. The provisions of any separate agreement concerning security shall,
if inconsistent herewith, control and govern Bank's rights in respect thereby.

          9.   (a) Each remedy of Bank herein provided is cumulative, not
alternative and in addition to all other remedies provided by law, and no
waiver by Bank of any term or condition hereof or breach hereunder shall be
deemed a waive of any other term, condition, or subsequent breach; (b) all
payments, remittances, deliveries of documents and instruments, and notices to
Bank shall be made and delivered (unless otherwise specified herein) to the
office of Bank shown on the reverse hereof; (c) this Agreement shall inure to
the benefit of Bank's successors and assigns, and shall be binding upon the
heirs, personal representatives, guardians, conservators, and trustees of the
applicant; (d) if the applicant is more than one person, the liability of each
applicant shall be joint and several.

          10.  Without releasing the applicant from any liability hereunder and
under the Credit, Bank may make such changes from the terms set forth herein as
Bank, in its sole discretion, may deem advisable, provided that no such changes
shall vary the principal terms hereof (amount, expiry); however, Bank may, at
the applicant's request, which may be signified by signing or initialing such
change(s), vary or modify principal terms as described herein. Further, Bank
may surrender, from time to time, to the person designated by the applicant (or
their nominees) all or any part of any property, goods, documents, and
instruments against payments by, or other documents or instruments satisfactory
to Bank executed by such persons.

          11.  The applicant will comply with all foreign and U.S. laws, rules
and regulations (including exchange and control regulations) now or hereafter
applicable to the transaction related to the Credit or applicable to the
execution, delivery, and performance by the applicant of this Agreement.

          12.  This Agreement shall be construed and enforced in accordance
with the International Standby Practices (the "ISP") as most recently published
by the International Chamber of Commerce (ICC Publication 590) and in
accordance with the laws of the State of Hawaii, U.S.A. The ISP shall govern in
the event of any inconsistency.

          13.  If Bank extends to applicant (or any other party liable
hereunder) a loan or other credit which in whole or in part is intended to (or
does) satisfy the obligations of the applicant hereunder (or of any other party
liable hereunder), the rights of Bank hereunder shall continue until both full
satisfaction of all obligations owed Bank hereunder as well as full
satisfaction of all obligations owed Bank under any loan or other credit
documents. Bank shall have all rights hereunder and under any such other
documents, separately and cumulatively, until the occurrence of both events

          14.  The applicant hereby authorizes Bank to accept, honor, or pay
(as applicable) against any draft or other document which on its face appears
otherwise in order but which is signed, issued, or presented by any party or
under the name of any party (a) purporting to act with authority (actual or
apparent) on behalf of anyone named in the Credit as the person to whom drafts
and other documents and instruments are to be drawn or issued (herein called
the "Beneficiary"), (b) purporting to claim through such Beneficiary, or (c)
posing as such Beneficiary. The applicant hereby agrees to reimburse Bank and
any and all amounts which Bank may have to pay under the Credit by reason of
any legal or factual insufficiency or infirmity in such party's conduct or
documents under clauses (a), (b), or (c) above.




<p Style="page-break-after:always">




                                   EXHIBIT E
                   SUBSIDIARIES OF ALEXANDER & BALDWIN, INC.
                   -----------------------------------------



                                                            
                                                           NO. OF          % OF
                                                          UNITS OR        COMMON
                                                           SHARES         EQUITY
                                                           OWNED          OWNED
                          JURISDICTION                     BY A&B         BY A&B
                               OF        PRINCIPAL       DIRECTLY OR    DIRECTLY OR
       LEGAL NAME         ORGANIZATION   BUSINESS        INDIRECTLY     INDIRECTLY

A&B Development Company    California    Real-estate           100         100%
(California)

A&B Properties, Inc.       Hawaii        Real-estate         4,517         100%

ABHI-Crockett, Inc.***     Hawaii        Food Products     151,785         100%

Agri-Quest Development     Hawaii        Agriculture         1,000         100%
Company

East Maui Irrigation       Hawaii        Agriculture        14,270         100%
Company, Limited

Haleakala Town Center LLC  Hawaii LLC    Real-estate             1         100%

Hawaiian DuraGreen, Inc.   Hawaii        Panelboard          1,000         100%

Kahului Trucking &         Hawaii        Trucking &          1,000         100%
Storage, Inc.                            Storage

Kauai Commercial Company,  Hawaii        Trucking &          1,000         100%
Incorporated                             Storage

Kukui'ula Development      Hawaii        Real-estate         1,000         100%
Company, Inc.

Prospect Venture LLC       Hawaii LLC    Real-estate             1         100%

South Shore Community      Hawaii LLC    Real-estate             1         100%
Services LLC

South Shore Resources LLC  Hawaii LLC    Real-estate             1         100%

Kauai Coffee Company,      Hawaii        Agriculture         1,000         100%
Inc.**

Ohanui Corporation         Hawaii        Agriculture            10         100%

Matson Navigation          Hawaii        Ocean               1,000         100%
Company, Inc.                            Transportation

Matson Intermodal System,  Hawaii        Freight             1,000         100%
Inc.*                                    Transportation

Matson Intermodal _        Hawaii        Freight             1,000         100%
Paragon, Inc.****                        Transportation

Matson Logistics           Hawaii        Freight             1,000         100%
Solutions, Inc.*                         Transportation

Matson Terminals, Inc.*    Hawaii        Terminal            1,000         100%
                                         Services

Matson Ventures, Inc.*     Hawaii        Transportation        500         100%
                                         Services

McBryde Sugar Company,     Hawaii        Real-estate       439,000         100%
Limited

Upcountry Town Center,     Hawaii LLC    Real-estate             1         100%
LLC

WDCI, Inc.                 Hawaii        Real-estate           100         100%

West Maui Development      Hawaii LLC    Real-estate             1         100%
Company LLC

A&B, Inc.                  Hawaii        Inactive               10         100%

The Matson Company*        California    Inactive            1,000         100%

The Oceanic Steamship      California    Inactive                5         100%
Company*

Matson Services Inc.*      Hawaii        Inactive            1,000         100%


  *    Subsidiary of Matson Navigation Company, Inc.
  **   Subsidiary of McBryde Sugar Company, Ltd.
  ***  5.3% owned by McBryde Sugar Company, Ltd.




<p Style="page-break-after:always">


                             REVOLVING CREDIT NOTE


$45,000,000.00
                                                              Honolulu, Hawaii

                                                             November 30, 2001

          ALEXANDER & BALDWIN, INC., a Hawaii corporation (hereafter referred
to as the "Borrower"), FOR VALUE RECEIVED, hereby promises to pay to the order
of FIRST HAWAIIAN BANK (the "Payee") at the offices of First Hawaiian Bank, a
Hawaii Corporation, located at 999 Bishop Street, Honolulu, Hawaii, 96813, the
principal sum of FORTY-FIVE MILLION AND NO/100 DOLLARS ($45,000,000.00), on the
Termination Date (as defined in the Agreement referred to below) in lawful
money of the United States of America and in immediately available funds.

          The Borrower promises also to pay interest on the unpaid principal
amount thereof in like money and funds at said office from the date hereof
until paid at the rates per annum which will be determined in accordance with
the provisions of Article I and Article II of the Third Amended and Restated
Revolving Credit and Term Loan Agreement (the "Agreement") effective as of
November 19,  2001, among the Borrower, the Payee and the other banks party
thereto, said interest to be payable at the times provided for in the
Agreement.

          This Note is one of the Notes referred to in the Agreement and is
entitled to the benefits thereof.  This Note is subject to prepayment, in whole
or in part, as specified in the Agreement.  In case an Event of Default, as
defined in the Agreement, shall occur and shall be continuing, the principal of
and accrued interest on this Note may become due and payable in the manner and
with the effect provided in the Agreement.

          The Borrower hereby waives presentment, demand, protest or notice of
any kind in connection with this Note.


          This Note shall be governed by and construed in accordance with the
laws of the State of Hawaii.



                             ALEXANDER & BALDWIN, INC.


                             By     /s/ James S. Andrasick
                               ---------------------------------
                                  JAMES S. ANDRASICK
                                  Its Senior Vice President,
                                    Chief Financial Officer and
                                    Treasurer


                             By     /s/ Thomas A. Wellman
                               ---------------------------------
                                  THOMAS A. WELLMAN
                                  Its Controller and
                                    Assistant Treasurer


<p Style="page-break-after:always">

                          LOAN AND REPAYMENT SCHEDULE
                             REVOLVING CREDIT NOTE
                             ---------------------
_______________________________________________________________________________

              (Use this section when evidencing a Eurodollar Loan)

                                EURODOLLAR LOANS
                                ----------------
_______________________________________________________________________________


                                          Amount and
                                          date of
                                          Principal
                                          Repayment     Amount and
                                          (including    date of
      When                    Maturity    amounts       Interest       Notation
Rate  Made  Term    Amount    Date        converted)    Payment        Made By
_______________________________________________________________________________












_______________________________________________________________________________

               (Use this section when evidencing Prime Rate Loan)

                                PRIME RATE LOANS
                                ----------------
_______________________________________________________________________________


                                          Amount and
                                          date of
                                          Principal
                                          Repayment     Amount and
                                          (including    date of
      When                    Maturity    amounts       Interest       Notation
Rate  Made  Term    Amount    Date        converted)    Payment        Made By
_______________________________________________________________________________

<p Style="page-break-after:always">

                             REVOLVING CREDIT NOTE


$40,000,000.00
                                                              Honolulu, Hawaii

                                                             November 30, 2001

          ALEXANDER & BALDWIN, INC., a Hawaii corporation (hereafter referred
to as the "Borrower"), FOR VALUE RECEIVED, hereby promises to pay to the order
of BANK OF AMERICA, N.A. (the "Payee") at the offices of First Hawaiian Bank, a
Hawaii Corporation located at 999 Bishop Street, Honolulu, Hawaii, 96813, the
principal sum of FORTY MILLION AND NO/100 DOLLARS ($40,000,000.00), on the
Termination Date (as defined in the Agreement referred to below) in lawful
money of the United States of America and in immediately available funds.

          The Borrower promises also to pay interest on the unpaid principal
amount thereof in like money and funds at said office from the date hereof
until paid at the rates per annum which will be determined in accordance with
the provisions of Article I and Article II of the Third Amended and Restated
Revolving Credit and Term Loan Agreement (the "Agreement") effective as of
November 19, 2001, among the Borrower, the Payee and the other banks party
thereto, said interest to be payable at the times provided for in the
Agreement.

          This Note is one of the Notes referred to in the Agreement and is
entitled to the benefits thereof.  This Note is subject to prepayment, in whole
or in part, as specified in the Agreement.  In case an Event of Default, as
defined in the Agreement, shall occur and shall be continuing, the principal of
and accrued interest on this Note may become due and payable in the manner and
with the effect provided in the Agreement.

          The Borrower hereby waives presentment, demand, protest or notice of
any kind in connection with this Note.

          This Note shall be governed by and construed in accordance with the
laws of the State of Hawaii.

                             ALEXANDER & BALDWIN, INC.


                             By     /s/ James S. Andrasick
                               ---------------------------------
                                  JAMES S. ANDRASICK
                                  Its Senior Vice President,
                                    Chief Financial Officer and
                                    Treasurer


                             By     /s/ Thomas A. Wellman
                               ---------------------------------
                                  THOMAS A. WELLMAN
                                  Its Controller and
                                    Assistant Treasurer


<p Style="page-break-after:always">

                          LOAN AND REPAYMENT SCHEDULE
                             REVOLVING CREDIT NOTE
                             ---------------------
_______________________________________________________________________________

              (Use this section when evidencing a Eurodollar Loan)

                                EURODOLLAR LOANS
                                ----------------
_______________________________________________________________________________


                                          Amount and
                                          date of
                                          Principal
                                          Repayment     Amount and
                                          (including    date of
      When                    Maturity    amounts       Interest       Notation
Rate  Made  Term    Amount    Date        converted)    Payment        Made By
_______________________________________________________________________________












_______________________________________________________________________________

               (Use this section when evidencing Prime Rate Loan)

                                PRIME RATE LOANS
                                ----------------
_______________________________________________________________________________


                                          Amount and
                                          date of
                                          Principal
                                          Repayment     Amount and
                                          (including    date of
      When                    Maturity    amounts       Interest       Notation
Rate  Made  Term    Amount    Date        converted)    Payment        Made By
_______________________________________________________________________________

<p Style="page-break-after:always">


                             REVOLVING CREDIT NOTE


$40,000,000.00
                                                              Honolulu, Hawaii

                                                             November 30, 2001

          ALEXANDER & BALDWIN, INC., a Hawaii corporation (hereafter referred
to as the "Borrower"), FOR VALUE RECEIVED, hereby promises to pay to the order
of WELLS FARGO BANK, NATIONAL ASSOCIATION (the "Payee") at the offices of First
Hawaiian Bank, a Hawaii Corporation, located at 999 Bishop Street, Honolulu,
Hawaii, 96813, the principal sum of FORTY MILLION AND NO/100 DOLLARS
($40,000,000.00), on the Termination Date (as defined in the Agreement referred
to below) in lawful money of the United States of America and in immediately
available funds.

          The Borrower promises also to pay interest on the unpaid principal
amount thereof in like money and funds at said office from the date hereof
until paid at the rates per annum which will be determined in accordance with
the provisions of Article I and Article II of the Third Amended and Restated
Revolving Credit and Term Loan Agreement (the "Agreement") effective as of
November 19, 2001, among the Borrower, the Payee and the other banks party
thereto, said interest to be payable at the times provided for in the
Agreement.

          This Note is one of the Notes referred to in the Agreement and is
entitled to the benefits thereof.  This Note is subject to prepayment, in whole
or in part, as specified in the Agreement.  In case an Event of Default, as
defined in the Agreement, shall occur and shall be continuing, the principal of
and accrued interest on this Note may become due and payable in the manner and
with the effect provided in the Agreement.
<p Style="page-break-after:always">


          The Borrower hereby waives presentment, demand, protest or notice of
any kind in connection with this Note.

          This Note shall be governed by and construed in accordance with the
laws of the State of Hawaii.

                             ALEXANDER & BALDWIN, INC.


                             By     /s/ James S. Andrasick
                               ---------------------------------
                                  JAMES S. ANDRASICK
                                  Its Senior Vice President,
                                    Chief Financial Officer and
                                    Treasurer


                             By     /s/ Thomas A. Wellman
                               ---------------------------------
                                  THOMAS A. WELLMAN
                                  Its Controller and
                                    Assistant Treasurer





<p Style="page-break-after:always">

                          LOAN AND REPAYMENT SCHEDULE
                             REVOLVING CREDIT NOTE
                             ---------------------
_______________________________________________________________________________

              (Use this section when evidencing a Eurodollar Loan)

                                EURODOLLAR LOANS
                                ----------------
_______________________________________________________________________________


                                          Amount and
                                          date of
                                          Principal
                                          Repayment     Amount and
                                          (including    date of
      When                    Maturity    amounts       Interest       Notation
Rate  Made  Term    Amount    Date        converted)    Payment        Made By
_______________________________________________________________________________












_______________________________________________________________________________

               (Use this section when evidencing Prime Rate Loan)

                                PRIME RATE LOANS
                                ----------------
_______________________________________________________________________________


                                          Amount and
                                          date of
                                          Principal
                                          Repayment     Amount and
                                          (including    date of
      When                    Maturity    amounts       Interest       Notation
Rate  Made  Term    Amount    Date        converted)    Payment        Made By
_______________________________________________________________________________


<p Style="page-break-after:always">



                             REVOLVING CREDIT NOTE


$30,000,000.00
                                                              Honolulu, Hawaii

                                                             November 30, 2001

          ALEXANDER & BALDWIN, INC., a Hawaii corporation (hereafter referred
to as the "Borrower"), FOR VALUE RECEIVED, hereby promises to pay to the order
of BANK OF HAWAII (the "Payee") at the offices of First Hawaiian Bank, a Hawaii
Corporation located at 999 Bishop Street, Honolulu, Hawaii, 96813, the
principal sum of THIRTY MILLION AND NO/100 DOLLARS ($30,000,000.00), on the
Termination Date (as defined in the Agreement referred to below) in lawful
money of the United States of America and in immediately available funds.

          The Borrower promises also to pay interest on the unpaid principal
amount thereof in like money and funds at said office from the date hereof
until paid at the rates per annum which will be determined in accordance with
the provisions of Article I and Article II of the Third Amended and Restated
Revolving Credit and Term Loan Agreement (the "Agreement") effective as of
November 19, 2001, among the Borrower, the Payee and the other banks party
thereto, said interest to be payable at the times provided for in the
Agreement.

          This Note is one of the Notes referred to in the Agreement and is
entitled to the benefits thereof.  This Note is subject to prepayment, in whole
or in part, as specified in the Agreement.  In case an Event of Default, as
defined in the Agreement, shall occur and shall be continuing, the principal of
and accrued interest on this Note may become due and payable in the manner and
with the effect provided in the Agreement.

          The Borrower hereby waives presentment, demand, protest or notice of
any kind in connection with this Note.

          This Note shall be governed by and construed in accordance with the
laws of the State of Hawaii.

                             ALEXANDER & BALDWIN, INC.


                             By     /s/ James S. Andrasick
                               ---------------------------------
                                  JAMES S. ANDRASICK
                                  Its Senior Vice President,
                                    Chief Financial Officer and
                                    Treasurer


                             By     /s/ Thomas A. Wellman
                               ---------------------------------
                                  THOMAS A. WELLMAN
                                  Its Controller and
                                    Assistant Treasurer



<p Style="page-break-after:always">

                          LOAN AND REPAYMENT SCHEDULE
                             REVOLVING CREDIT NOTE
                             ---------------------
_______________________________________________________________________________

              (Use this section when evidencing a Eurodollar Loan)

                                EURODOLLAR LOANS
                                ----------------
_______________________________________________________________________________


                                          Amount and
                                          date of
                                          Principal
                                          Repayment     Amount and
                                          (including    date of
      When                    Maturity    amounts       Interest       Notation
Rate  Made  Term    Amount    Date        converted)    Payment        Made By
_______________________________________________________________________________












_______________________________________________________________________________

               (Use this section when evidencing Prime Rate Loan)

                                PRIME RATE LOANS
                                ----------------
_______________________________________________________________________________


                                          Amount and
                                          date of
                                          Principal
                                          Repayment     Amount and
                                          (including    date of
      When                    Maturity    amounts       Interest       Notation
Rate  Made  Term    Amount    Date        converted)    Payment        Made By
_______________________________________________________________________________

<p Style="page-break-after:always">





                             REVOLVING CREDIT NOTE


$20,000,000.00
                                                              Honolulu, Hawaii

                                                             November 30, 2001

          ALEXANDER & BALDWIN, INC., a Hawaii corporation (hereafter referred
to as the "Borrower"), FOR VALUE RECEIVED, hereby promises to pay to the order
of BANK OF NEW YORK (the "Payee") at the offices of First Hawaiian Bank, a
Hawaii Corporation, located at 999 Bishop Street, Honolulu, Hawaii, 96813, the
principal sum of TWENTY MILLION AND NO/100 DOLLARS ($20,000,000.00), on the
Termination Date (as defined in the Agreement referred to below) in lawful
money of the United States of America and in immediately available funds.

          The Borrower promises also to pay interest on the unpaid principal
amount thereof in like money and funds at said office from the date hereof
until paid at the rates per annum which will be determined in accordance with
the provisions of Article I and Article II of the Third Amended and Restated
Revolving Credit and Term Loan Agreement (the "Agreement") effective as of
November 19, 2001, among the Borrower, the Payee and the other banks party
thereto, said interest to be payable at the times provided for in the
Agreement.

          This Note is one of the Notes referred to in the Agreement and is
entitled to the benefits thereof.  This Note is subject to prepayment, in whole
or in part, as specified in the Agreement.  In case an Event of Default, as
defined in the Agreement, shall occur and shall be continuing, the principal of
and accrued interest on this Note may become due and payable in the manner and
with the effect provided in the Agreement.

          The Borrower hereby waives presentment, demand, protest or notice of
any kind in connection with this Note.

          This Note shall be governed by and construed in accordance with the
laws of the State of Hawaii.

                             ALEXANDER & BALDWIN, INC.


                             By     /s/ James S. Andrasick
                               ---------------------------------
                                  JAMES S. ANDRASICK
                                  Its Senior Vice President,
                                    Chief Financial Officer and
                                    Treasurer


                             By     /s/ Thomas A. Wellman
                               ---------------------------------
                                  THOMAS A. WELLMAN
                                  Its Controller and
                                    Assistant Treasurer



<p Style="page-break-after:always">

                          LOAN AND REPAYMENT SCHEDULE
                             REVOLVING CREDIT NOTE
                             ---------------------
_______________________________________________________________________________

              (Use this section when evidencing a Eurodollar Loan)

                                EURODOLLAR LOANS
                                ----------------
_______________________________________________________________________________


                                          Amount and
                                          date of
                                          Principal
                                          Repayment     Amount and
                                          (including    date of
      When                    Maturity    amounts       Interest       Notation
Rate  Made  Term    Amount    Date        converted)    Payment        Made By
_______________________________________________________________________________












_______________________________________________________________________________

               (Use this section when evidencing Prime Rate Loan)

                                PRIME RATE LOANS
                                ----------------
_______________________________________________________________________________


                                          Amount and
                                          date of
                                          Principal
                                          Repayment     Amount and
                                          (including    date of
      When                    Maturity    amounts       Interest       Notation
Rate  Made  Term    Amount    Date        converted)    Payment        Made By
_______________________________________________________________________________

<p Style="page-break-after:always">



                             REVOLVING CREDIT NOTE


$10,000,000.00
                                                              Honolulu, Hawaii

                                                             November 30, 2001

          ALEXANDER & BALDWIN, INC., a Hawaii corporation (hereafter referred
to as the "Borrower"), FOR VALUE RECEIVED, hereby promises to pay to the order
of AMERICAN SAVINGS BANK, F.S.B. (the "Payee") at the offices of First Hawaiian
Bank, a Hawaii Corporation located at 999 Bishop Street, Honolulu, Hawaii,
96813, the principal sum of TEN MILLION AND NO/100 DOLLARS ($10,000,000.00), on
the Termination Date (as defined in the Agreement referred to below) in lawful
money of the United States of America and in immediately available funds.

          The Borrower promises also to pay interest on the unpaid principal
amount thereof in like money and funds at said office from the date hereof
until paid at the rates per annum which will be determined in accordance with
the provisions of Article I and Article II of the Third Amended and Restated
Revolving Credit and Term Loan Agreement (the "Agreement") effective as of
November 19, 2001, among the Borrower, the Payee and the other banks party
thereto, said interest to be payable at the times provided for in the
Agreement.

          This Note is one of the Notes referred to in the Agreement and is
entitled to the benefits thereof.  This Note is subject to prepayment, in whole
or in part, as specified in the Agreement.  In case an Event of Default, as
defined in the Agreement, shall occur and shall be continuing, the principal of
and accrued interest on this Note may become due and payable in the manner and
with the effect provided in the Agreement.

          The Borrower hereby waives presentment, demand, protest or notice of
any kind in connection with this Note.

          This Note shall be governed by and construed in accordance with the
laws of the State of Hawaii.

                             ALEXANDER & BALDWIN, INC.


                             By     /s/ James S. Andrasick
                               ---------------------------------
                                  JAMES S. ANDRASICK
                                  Its Senior Vice President,
                                    Chief Financial Officer and
                                    Treasurer


                             By     /s/ Thomas A. Wellman
                               ---------------------------------
                                  THOMAS A. WELLMAN
                                  Its Controller and
                                    Assistant Treasurer



<p Style="page-break-after:always">

                          LOAN AND REPAYMENT SCHEDULE
                             REVOLVING CREDIT NOTE
                             ---------------------
_______________________________________________________________________________

              (Use this section when evidencing a Eurodollar Loan)

                                EURODOLLAR LOANS
                                ----------------
_______________________________________________________________________________


                                          Amount and
                                          date of
                                          Principal
                                          Repayment     Amount and
                                          (including    date of
      When                    Maturity    amounts       Interest       Notation
Rate  Made  Term    Amount    Date        converted)    Payment        Made By
_______________________________________________________________________________












_______________________________________________________________________________

               (Use this section when evidencing Prime Rate Loan)

                                PRIME RATE LOANS
                                ----------------
_______________________________________________________________________________


                                          Amount and
                                          date of
                                          Principal
                                          Repayment     Amount and
                                          (including    date of
      When                    Maturity    amounts       Interest       Notation
Rate  Made  Term    Amount    Date        converted)    Payment        Made By
_______________________________________________________________________________

<p Style="page-break-after:always">



</PRE><div><a name="tenthamend.txt"></a></div><PRE>
                            TENTH AMENDMENT TO GRID NOTE


     THIS TENTH AMENDMENT TO GRID NOTE is made on November 30, 2001, and
effective as of November 30, 2001, by and between ALEXANDER & BALDWIN, INC., a
Hawaii corporation, hereinafter called the "Maker", and FIRST HAWAIIAN BANK, a
Hawaii corporation, hereinafter called the "Bank";

                               WITNESSETH THAT;

     WHEREAS, the Bank extended to the Maker that certain uncommitted line of
credit facility in the principal amount not to exceed FORTY MILLION AND NO/100
DOLLARS ($40,000,000.00) which line of credit is evidenced by that certain Grid
Note (the "Note") dated December 30, 1993, with a final maturity of said Note
being November 30, 1994; and

     WHEREAS, the Maker and the Bank subsequently entered into that certain
Amendment to Grid Note dated August 31, 1994, whereby the Note was increased to
SIXTY-FIVE MILLION AND NO/100 DOLLARS ($65,000,000.00), Section 4 of the Note,
"Limitation" was deleted in its entirety and replaced, and the Note was
 ----------
extended to November 30, 1995; and

     WHEREAS, the Maker and the Bank subsequently entered into that Second
Amendment to Grid Note dated March 29, 1995, whereby the Note was decreased to
FORTY-FIVE MILLION AND NO/100 DOLLARS ($45,000,000.00), and Section 4 of the
Note, entitled "Limitation" was deleted in its entirety and replaced, and
                ----------

     WHEREAS, the Maker and the Bank subsequently entered into that Third
Amendment to Grid Note dated November 17, 1995, whereby the Note was extended
to November 30, 1996; and

     WHEREAS, the Maker and the Bank subsequently entered into that Fourth
Amendment to Grid Note dated November 25, 1996, whereby the Note was extended
to November 30, 1997; and

     WHEREAS, the Maker and the Bank subsequently entered into that Fifth
Amendment to Grid Note dated November 28, 1997, whereby the Note was extended
to November 30, 1998; and

     WHEREAS, the Maker and the Bank subsequently entered into that Sixth
Amendment to Grid Note dated November 30, 1998, whereby the Note was extended
to November 30, 1999; and

     WHEREAS, the Maker and the Bank subsequently entered into that Seventh
Amendment to Grid Note dated November 23, 1999, whereby the Note as extended
to November 30, 2000, and with the merger of A&B-Hawaii, Inc. into Alexander &
Baldwin, Inc., with Alexander & Baldwin, Inc. being the surviving corporation,
the obligations of A&B-Hawaii, Inc. under the Note were terminated, with all
references in the Note to the Maker deemed to be references to Alexander &
Baldwin, Inc.; and

     WHEREAS, the Maker and the Bank subsequently entered into that certain
Eighth  Amendment to Grid Note dated May 3, 2000, whereby the Note was
increased to SEVENTY MILLION AND NO/100 DOLLARS ($70,000,000.00), and Section 4
of the Note, "Limitation" was deleted in its entirety and replaced; and
       ----------

     WHEREAS, the Maker and the Bank subsequently entered into that Ninth
Amendment to Grid Note dated November 30, 2000, whereby the Note was extended
to November 30, 2001; and

     WHEREAS, the Maker and the Bank desire to further amend the Note as
hereinafter provided.

     NOW, THEREFORE, in consideration of the mutual covenants contained herein,
the Maker and the Bank agree as follows:

     1.  The Maturity Date of the Note, as previously amended, shall be and
hereby is further amended to provide that all unpaid principal and accrued but
unpaid interest shall be due and payable on NOVEMBER 30, 2002, unless sooner
due as otherwise provided in the Note.

     2.   Section 4 of the Note, entitled "Limitation", shall be deleted in its
entirety and replaced by the following:

          4.   Limitation.  Notwithstanding any contrary provision
               ----------
          hereunder, the unpaid principal balance outstanding under
          this Note, plus the unpaid principal balance or balances
          owing by the Maker under First Hawaiian Bank's share of that
          certain $185,000,000 Third Amended and Restated Revolving
          Credit and Term Loan Agreement, effective as of November 30,
          2001, by and between the Maker, the Bank and the banks
          that are parties thereto, as amended from time to time,
          shall not any time exceed the aggregate principal sum of
          $70,000,000.

     3.  In all other respects, the Note, as herein amended, shall remain
unmodified and in full force and effect, and the Maker hereby reaffirms all of
its obligations under the Note, as previously amended, and as amended hereby.
Without limiting the generality of the foregoing, the Maker hereby expressly
acknowledges and agrees that, as of the date of this TENTH AMENDMENT TO GRID
NOTE, the Maker has no offsets, claims or defenses whatsoever against the Bank
or against any of the Maker's obligations under the Note, as previously
amended, and as amended hereby, and that if any such claims, defenses or
offsets exist, they are hereby irrevocably waived and released.


     IN WITNESS WHEREOF, this Tenth Amendment to Grid Note is executed by the
undersigned parties on the date first above written.

                                   ALEXANDER & BALDWIN, INC.


                                   By:  /s/ J. S. Andrasick
                                        ----------------------------------
                                        James S. Andrasick
                                        Its:  Senior Vice President, Chief
                                              Financial Officer and Treasurer


                                   By:  /s/ Thomas A. Wellman
                                        ----------------------------------
                                        Thomas A. Wellman
                                        Its:  Controller and Assistant
                                              Treasurer

                                                                       "Maker"



                                   FIRST HAWAIIAN BANK


                                   By:  /s/ Lance A. Mizumoto
                                        ----------------------------------
                                        Lance A. Mizumoto
                                        Its:  Vice President
                                                                        "Bank"



</PRE><div><a name="piip.txt"></a></div><PRE>                        ALEXANDER & BALDWIN, INC.
           ONE-YEAR PERFORMANCE IMPROVEMENT INCENTIVE PLAN


                            AMENDMENT NO. 1
                            ---------------



	The Alexander & Baldwin, Inc. One-Year Performance Improvement Incentive
Plan, as restated effective October 22, 1992 (the "Plan"), is hereby amended,
effective as of January 1, 2002, as follows:

	1.	Section III.A. of the Plan is hereby amended by adding the following
sentence to the end thereof:  "Beginning with awards granted for the 2002 Plan
Year, however, an eligible assignment is a job with 1350 total points under
the Company's job evaluation program."

	2.	Section V.B.2. is hereby amended by replacing it in its entirety with
the following:

	   "2.  Aggregate.  The aggregate award paid to all participants will be
   limited by minimum requirements for 'income before income taxes' and
   'return on adjusted net assets' for the Company, which will be established
   or approved by the Committee in advance for each Plan Year.  If such
   limitations become effective, then the individual award of each participant
   will be proportionately reduced."

	3.	Except as modified by this Amendment, all terms and provisions of the
Plan shall continue in full force and effect.

	IN WITNESS WHEREOF, Alexander & Baldwin, Inc. has caused this Amendment to
be executed on its behalf by its duly authorized officers on this 13th day of
December, 2001.


                                             ALEXANDER & BALDWIN, INC.

                                             By /s/ John F. Gasher
                                                Its Vice President


                                             By /s/ Alyson J. Nakamura
                                             Its Secretary




</PRE><div><a name="exh11_10-k.txt"></a></div><PRE>
                                                                     EXHIBIT 11

                           ALEXANDER & BALDWIN, INC.
                       COMPUTATION OF EARNINGS PER SHARE
              FOR THE YEARS ENDED DECEMBER 31, 2001, 2000 AND 1999
                    (In thousands, except per share amounts)


                                             2001          2000         1999
                                             ----          ----         ----

Basic Earnings Per Share
- ------------------------
                                                             

   Net income                             $ 110,628     $  90,574     $  62,579
                                          =========     =========     =========
   Average number of shares outstanding      40,535        40,898        43,206
                                          =========     =========     =========
   Basic earnings per share               $    2.73     $    2.21     $    1.45
                                          =========     =========     =========

Diluted Earnings Per Share
- --------------------------

   Net income                             $ 110,628     $  90,574     $  62,579
                                          =========     =========     =========

   Average number of shares outstanding      40,535        40,898        43,206
   Effect of assumed exercise of
      outstanding stock options                 185           109            30
                                          ---------     ---------     ---------
   Average number of shares outstanding
      after assumed exercise of
      outstanding stock options              40,720        41,007        43,236
                                          =========     =========     =========

   Diluted earnings per share             $    2.72     $    2.21     $    1.45
                                          =========     =========     =========



</PRE><div><a name="exh21_10-k.txt"></a></div><PRE>

                    ALEXANDER & BALDWIN, INC.
             Subsidiaries as of February 28, 2002

                                              State or Other
                                            Jurisdiction Under
Name of Subsidiary                            Which Organized
- ------------------                          ------------------

A & B Development Company (California)          California
A & B Properties, Inc.                          Hawaii
ABHI-Crockett, Inc.                             Hawaii
McBryde Sugar Company, Limited                  Hawaii
   Subsidiary:
        Kauai Coffee Company, Inc.              Hawaii
East Maui Irrigation Company, Limited           Hawaii
Hawaiian DuraGreen, Inc.                        Hawaii
Kahului Trucking & Storage, Inc.                Hawaii
Kauai Commercial Company, Incorporated          Hawaii
Kukui'Ula Development Company, Inc.             Hawaii
   Subsidiary:
        South Shore Community Services LLC      Hawaii
Matson Navigation Company, Inc.                 Hawaii
   Subsidiaries:
        Matson Intermodal System, Inc.          Hawaii
        Matson Logistics Solutions, Inc.        Hawaii
        Matson Terminals, Inc.                  Hawaii
WDCI, INC.                                      Hawaii


NOTE:   Certain A&B subsidiaries, which considered in the aggregate do not
        constitute a significant subsidiary, have been omitted.


</PRE>

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