The shares regained some ground later in the day and closed at 45 cents, down 70 percent from its $1.50 price before the Chapter 11 bankruptcy filing. The shares have lost 87 percent of their value since reaching a one-year high of $4 on June 27.

The American Stock Exchange allowed trading to resume after reviewing the airline's annual report issued yesterday.

In the report, the airline stated there is "substantial doubt about our ability to continue as a going concern," raising uncertainty about its ability to emerge from bankruptcy successfully. But spokesman Keoni Wagner dismissed the comment contained in the filing as "common language."

Hawaiian noted in the report that absent other adverse developments, its cash would be sufficient to pay for current operations through 2003.

Also yesterday a federal bankruptcy judge said there were serious allegations about misconduct at the airline and the court would rule on a request from Boeing Capital, which has leased aircraft to Hawaiian, to replace Hawaiian CEO John Adams with a trustee during the bankruptcy. Hawaiian has cited its inability to renegotiate leases with Boeing as a primary reason for filing for bankruptcy.

Asked about the allegations of misconduct, airline spokesman Wagner said: "We take the Boeing assertions very seriously, and we are taking our time to address each of them properly, which we will do in court in due course. Then everyone will have the benefit of hearing our side of the story."

Adams, a New York City resident, paid $20 million for 68 percent of Hawaiian in 1996, soon after the company had emerged from an earlier Chapter 11 bankruptcy.

He bought his shares of Hawaiian through Airline Investors Partnership, a Delaware company formed to take control of the airline.

A frequent investor in financially distressed companies, Adams has controlled firms including automobile parts manufacturer Harvard Industries and health systems management company Regency Health Services. He also owns Smith Management LLC, a private investment firm in New York City.

During Adams' tenure at Hawaiian, the company replaced its aging fleet of McDonnell-Douglas DC-10 jets with new Boeing planes, leased from the manufacturer. Hawaiian's inability to make its lease payments are at the heart of the company's petition for Chapter 11 bankruptcy protection.

Hawaiian paid Adams a $600,000 base salary last year, plus a $2 million bonus payment, and $900,000 in consulting fees to one of his firms.