News Releases

Friday, October 31, 2003

PARKER RANCH FOUNDATION TRUST RESTRUCTURES ROLES AND RESPONSIBILITIES

TRUST SETS UP MECHANISM TO CHOOSE SUCCESSOR TRUSTEES

WAIMEA, BIG ISLAND OF HAWAII A two-year corporate restructuring at Parker Ranch Foundation Trust that began in January 2002 is nearly complete. The new corporate structure calls for a modified Trustee role with day-to-day operations headed by a Chief Executive Officer. Consequently, Dave Houle, formerly Parker Ranch Chief Operating Officer, was appointed President and Chief Executive Officer of Parker Ranch, Inc.

Once this new corporate structure was achieved, the three Parker Ranch Foundation Trust Trustees (Mel Hewett, Carl Carlson, Tom Whittemore) then began to reassess their involvement both short- and long-term. Trustee Carl Carlson announced his work complete in August and tendered his resignation pending the selection of a successor trustee. Thereafter, the three Trustees unanimously determined a two-year course of action to secure stability for the Trust parallel with planned transitions.

During the course of 2004, Tom Whittemore, who has served the Parker Ranch Foundation Trust since 1999, and been instrumental in developing the Trust investment policy and plan, will shift his duties and responsibilities to an as-yet-to-be-named successor Trustee. In 2005, Mel Hewett, one of the original Trustees personally selected by Richard Smart prior to his death in 1992, will retire at age 70.

Hewett’s understanding of the responsibilities of the Parker Ranch Foundation Trust, the intent of Richard Smart’s wishes for Trust beneficiaries and the Waimea community as outlined in his Will, and the asset appreciation phase of the restructuring plan, will provide a knowledge bank for the new successor Trustees.

Since its inception in 1992, the Parker Ranch Foundation Trust initiated a three-phase evolution. The first phase, a period of probate settlement, litigation and short-term debt repayment, successfully concluded in 1999 with long-term debt restructuring. The Trust is about to emerge from the second phase with its diversification, land planning, expanded efforts to blend the visitor industry with Ranch history and lifestyle, and revenue enhancements. The third phase, one of asset appreciation, will increase distributions to Trust beneficiaries and the greater Waimea community.

Trustee Mel Hewett commented, “We faced the challenges of a Trust funded with land, but virtually no cash. We defended Richard Smart’s Will in a lengthy legal battle and paid out $26 million in federal estate taxes, bequests and legal costs. We oversaw the redesign and renovation of the 30-year-old Parker Ranch Center into a modern, dynamic locale for shopping and dining in Waimea. Management of Parker Ranch, Inc. has been restructured and the long-term future for Parker Ranch is solid.”

“With Parker Ranch’s newly redefined Trustee role, it is the opportune time to phase in successor Trustees,” said Trustee Tom Whittemore. “We will work with a Trustee Selection Advisory Committee in naming successor Trustees to guide Parker Ranch into its next period of asset appreciation.”

The Trustees are forming a Trustee Selection Advisory Committee (TSAC) to recruit and review successor trustee candidates. Eight individuals will be appointed to the TSAC, four representing Trust Beneficiaries and four selected by the Trustees. The TSAC will provide five or more nominees to the Trustees for their consideration and the Trustees may appoint one or two of these individuals as new Trustees.

The transition of Trustees Whittemore and Hewett is subject to the successful appointment of new Trustees.

Parker Ranch’s restructuring process was initiated in January 2002 and focused on designing and implementing a more traditional corporate structure for the organization. Central to this effort was the development of a new Corporate Governance Policy to document the arms-length relationship that the tax-exempt Parker Ranch Foundation Trust maintains with its wholly owned for-profit subsidiary, Parker Ranch, Inc. The policy describes the relationship between Parker Ranch Foundation Trust and Parker Ranch, Inc., the role of the Trustees, the role of the Parker Ranch, Inc. Board of Directors and management.

The assets of Parker Ranch Foundation Trust are managed by the Trustees. The Board of Directors of Parker Ranch, Inc. assumes governance responsibilities over the policies and operations of the for-profit Parker Ranch, Inc. Its Board of Directors includes John Andrews, retired partner, Ernst and Young; Matt Echeverria, Senior Vice President, Tejon Ranch in Southern California; Gary L. Gifford, retired President and Chief Executive Officer, Maui Land & Pineapple; Herbert M. (Monty) Richards, President, Kahua Ranch; and Patrick K. Sullivan, Ph.D., P.E. founder, Oceanit Laboratories.

Parker Ranch is one of the largest ranches in the United States, spanning over 175,000 acres across Hawaii’s Big Island. It surrounds the town of Waimea and spreads between the Kohala and Mauna Kea mountains. The ranch is owned by the Parker Ranch Foundation Trust for the benefit of four local charities: North Hawaii Community Hospital, Hawaii Preparatory Academy, Parker School Trust Corporation and Hawaii Community Foundation’s Richard Smart Fund.

For more information on the Parker Ranch Foundation Trust, Trustee bios, Beneficiary information and distributions, and Parker Ranch visit the website at http://www.parkerranchfoundationtrust.com .