HECO Exhibit 10.18

RELEASE, TRANSITION AND CONSULTING AGREEMENT

This RELEASE, TRANSITION AND CONSULTING AGREEMENT (the “Agreement”) is made and
entered into this 5th day of June, 2009, by and between Thomas L. Joaquin,
residing at 91-1005 Kanihaalilo St., Kapolei, HI 96707-3011 (“Consultant”), and
Hawaiian Electric Company, Inc. (the “Company”).

R E C I T A L S

A. The Company is transitioning to a new organizational structure reflecting
changed circumstances.

B. Consultant has served the Company as its Senior Vice President-Operations.

C. The Company wishes to obtain the benefit of Consultant’s executive advice
during a period of transition by means of retaining him as a consultant for a
period of one year, and Consultant desires to be so retained.

D. The Company wishes to define and clarify the rights and obligations of the
parties with respect to the aforementioned one-year consulting period.

NOW, THEREFORE, in consideration of the premises, Consultant and the Company
(collectively, the “Parties”) hereby agree as follows.

A G R E E M E N T

1. RESIGNATION AND RETIREMENT. Effective June 30, 2009, Consultant shall resign
from employment and retire from the Company as an employee, and at that time
Consultant agrees to resign from any and all positions held at or on behalf of
Company. Incident to such termination, Consultant shall be entitled to any
benefit and to exercise any right available to an employee who separates from
service through retirement under the terms of the benefit and compensation plans
of the Company and its affiliates in which Consultant is a participant.
Notwithstanding the foregoing, and in addition to the benefits outlined in
Section 2 below, Consultant shall also be entitled to the Severance Pay and
Health Benefits Payment for which he would have been eligible under the
Severance Pay Plan for Merit Employees of Hawaiian Electric Industries, Inc.,
and Affiliates if his termination had been a Qualifying Termination for purposes
of such plan.

2. ENGAGEMENT AS CONSULTANT. Effective July 1, 2009, Consultant shall be engaged
to provide consulting services to the Company, subject to the following terms
and conditions.

(a) Term. The term of Consultant’s engagement under this Agreement shall be the
one year period from July 1, 2009 through June 30, 2010, or such earlier date on
which Consultant’s engagement is terminated in accordance with the terms of this
Agreement (as stipulated or so modified, the “Termination Date”).

 

1

--------------------------------------------------------------------------------

(b) Fee and Payment.

(1) In consideration for his serving as a consultant, Consultant shall be paid a
retainer and consulting fee (the “Fee”) which shall be equal to the sum of the
annual base salary as in effect on the last day of Consultant’s employment with
the Company (as stated in Section 1, Resignation and Retirement) and
Consultant’s targeted annual bonus, calculated as 30% of Consultant’s salary
midpoint as in effect on the last day of Consultant’s employment with the
Company.

(2) The Fee shall be paid in two installments. The first installment (50% of the
aggregate Fee) shall be paid on July 1, 2009. Provided that this Agreement has
not been terminated without Cause by Consultant or with Cause by the Company (as
“Cause” is defined in Section 3(b)(1), below), the second and final installment
(50% of the aggregate Fee) shall be paid on July 1, 2010. Payment shall be made
on the date required or as soon thereafter as is administratively feasible, but
not later than two and one half months after such date. Payment of the second
installment shall be contingent upon Consultant’s providing a Final Release to
the Company, as defined in Section 5 below. If this Agreement is terminated with
Cause by the Company or without Cause by Consultant, or if the requirement for a
Final Release is not satisfied, then Consultant shall forfeit the second
installment portion of the Fee.

(c) Services. In exchange for the Fee, Consultant shall provide up to 500 hours
per year of consultation to the Company on demand. The matters on which the
Company may request consultation may range from matters relating to Consultant’s
special technical expertise to more general and nontechnical subjects within
Consultant’s knowledge, including, for example, matters pertaining to specific
vendors or to the strategic positioning of the Company in diverse fields of
energy production and conservation. Consultant’s service as a consultant shall
not exceed, on average, 83 1/3 hours per month. In no event shall Consultant’s
service exceed 500 hours for the twelve month period commencing July 1, 2009.

(d) Reimbursements; Miscellaneous Additional Benefits/Payments.

(di) Business Expenses. The Company shall reimburse Consultant for travel and
business expenses actually, reasonably and proximately incurred by Consultant in
rendering consulting services to the Company under this Agreement. Such expenses
shall not include expenses for equipment, such as computers, having a useful
life in excess of one year, advertising, office rent, parking, general or
professional liability insurance, meals and entertainment, club or association
dues or memberships, or expenses incurred by Consultant in employing other
persons. Travel expenses shall be reimbursed only if authorization for the
travel has been obtained from the Company in advance. The Company may condition
reimbursement upon such documentary proof of expenses as it reasonably deems
necessary.

(dii) Medical Payments. The Company shall reimburse Consultant for the cost of
medical insurance premiums payments made by Consultant for himself and for his
spouse for dental, vision and supplemental Medicare (B) premium payments, both
pursuant to COBRA, for a period not to exceed eighteen months beginning July 1,
2009.

(diii) Automobile. At June 30, 2009, title to the Company automobile, a Honda
Pilot currently used by Consultant while an employee, shall be transferred to
Consultant. This transfer from the Company, and acceptance by Consultant, is on
an “as is” basis; upon transfer of title to the automobile, the Company shall
have no further obligation with respect to the vehicle. Any vehicle warranty
still valid shall likewise be transferred to Consultant at no cost to the
Company. Further, the General Release set

 

2

--------------------------------------------------------------------------------

forth in Section 4(a) hereof covers the transfer of this automobile to the
Consultant. Consultant shall be responsible for all insurance relating to such
vehicle as of June 30, 2009.

(div) Restricted Stock. Instead of forfeiting all of the restricted stock grants
received by Consultant, the Company will pay Consultant upon termination the pro
rated value of his restricted stock grants – that is, the 2007 grant of 1000
shares prorated based on the ratio of 26.5 months out of 48 months, and the 2008
grant of 1000 shares prorated based on the ratio of 14.5 months out of 48
months. The pro rata value will be based on the average high/low share price of
HE stock listed on June 30, 2009.

(e) Independent Contractor Status.

(1) No coverage under benefit plans. Consultant acknowledges that his engagement
shall be on an independent contractor basis, and not as an employee of the
Company or any of its affiliates. Accordingly, Consultant acknowledges that he
shall not be treated as a common law employee for payroll purposes during the
term of this Agreement and shall not have the right to be provided benefits or
to accrue further benefits on account of his engagement as a Consultant under
any of the benefit plans maintained by the Company or its affiliates for
employees, including, without limitation, the Hawaiian Electric Industries
Retirement Savings Plan, the Retirement Plan for Employees of Hawaiian Electric
Industries, Inc. and Participating Subsidiaries, any vacation or paid time off
plan or policy of the Company, and any Worker’s Compensation or other disability
plan or program of the Company, even if his status should be re-determined by
the Internal Revenue Service or other regulatory agency as that of an employee.

(2) Terms and conditions of engagement. Except as otherwise specifically
provided herein, Consultant shall control the manner and conditions under which
his consulting services are provided. Without limiting the generality of the
foregoing, Consultant

 

  (A) shall establish his own hours and place of work; for the convenience of
the parties, the Company may, but is not required, to make office space
available to him on an as-needed or office sharing basis;

 

  (B) shall not have the right to participate in any training or workshops
offered to employees unless doing so is necessary for Consultant’s assignment;

 

  (C) shall provide his own tools and facilities (e.g., desk, telephone,
computer, and office space) and materials (e.g., office supplies and postage),
except as otherwise expressed in Section 2(e)(2)(I) below;

 

  (D) shall not receive secretarial or similar support from the Company, except
to the extent incidental support is provided to Consultant at the convenience of
the Company;

 

  (E) shall not be required to submit oral or written reports on a regularly
scheduled basis (e.g., daily, weekly);

 

  (F) shall not be required to work full-time;

 

  (G) shall apply for a General Excise Tax (“GET”) license from the State of
Hawaii and shall duly file and pay GET on the Fee, if applicable; and

 

  (H) shall be responsible for securing his own insurance coverage as may be
required or desired for operating as an independent consultant.

If Consultant determines to hire employees, such employees shall be retained and
their wages paid by Consultant himself; in no event and for no purpose shall
such employees be treated as employees of the Company. Further, the Company will
provide Consultant office space on an as needed basis when Consultant is
performing work for the Company and the use of the office is incidental to said
work. Consultant will be notified in advance when his attendance is required for
meetings. Consultant will be

 

3

--------------------------------------------------------------------------------

permitted limited access to the Company’s intranet for purposes of email
correspondence and for specific work assignments.

(3) Taxes. Except for applicable Hawaii GET related to services provided under
this Agreement, which shall be the responsibility of the Company, all other
taxes of every nature and kind levied on Consultant in relation to the services
or benefits provided under this Agreement, including, without limitation,
Federal and State net income taxes, shall be the responsibility of Consultant,
and the Company shall have no obligation to Consultant for the same.

3. TERMINATION OF CONSULTANT’S ENGAGEMENT PRIOR TO TERMINATION DATE.
Consultant’s engagement may be terminated by Company or Consultant prior to the
Termination Date only pursuant to this Section 3.

(a) Termination without Cause. Either Party may terminate Consultant’s
engagement without Cause upon 30 days’ written notice to the other Party. Such
termination shall be without prejudice to any other rights such terminating
Party may have under this Agreement or applicable law.

(1) By Company. If the Company terminates Consultant’s engagement without Cause,
the remainder of the Fee shall be paid to Consultant in a single sum as soon as
administratively feasible but not later than two and one half months after
Consultant’s satisfaction of the requirement for a Final Release

(2) By Consultant. If Consultant terminates his engagement without Cause, then
Consultant shall forfeit any remaining portion of the Fee, subject to Company’s
right to waive such forfeiture in its sole discretion. In the event of such
waiver, any remaining portion of the Fee may be paid to Consultant upon
Consultant’s satisfaction of the requirement for a Final Release.

(b) Termination for Cause by Company.

(1) For purposes of this Agreement, “Cause” shall mean:

(A) any act that constitutes a material violation of this Agreement or the
Company’s written policies for its employees, officers, directors, and vendors;

(B) engaging in conduct materially and demonstrably injurious to the Company; or

(C) any act that violates Section 6 or 7 of this Agreement,

provided that the Company specifically terminates the Consultant’s engagement
for Cause within 30 calendar days from the date the Company has actual notice of
such conduct or within such other time as may be mutually agreed in writing by
the Company and Consultant in order to afford the Company the opportunity for
full review.

(2) If the Company terminates the Consultant’s engagement for Cause, then
Consultant shall forfeit any remaining portion of the Fee.

(c) Termination for Good Reason by Consultant.

(1) For purposes of this Agreement, “Good Reason” shall mean termination by
Consultant of Consultant’s engagement owing to:

 

4

--------------------------------------------------------------------------------

(A) a material diminution in Consultant’s compensation under this Agreement,
including the failure of the Company to pay any installment of the Fee when such
installment is due, which failure is not cured within fifteen (15) days of
written notification by Consultant; or

(B) any other action or inaction that constitutes a material breach by the
Company of this Agreement, and which are not cured within thirty (30) days of
written notice of such breach or breaches to the Company by the Consultant, or
such other period as may be mutually agreed in writing by the Parties,

provided that Consultant terminates his engagement for Good Reason within 30
days of such act or event.

(2) If the Consultant terminates his engagement for Good Reason, then Consultant
shall be entitled to payment of the remaining portion of the Fee in the manner
described in Section 2(b)(2), provided that Consultant executes the Final
Release. Alternatively, Consultant may freely retain any claims that Consultant
believes he may have against the Company, but in that event shall not be
entitled to payment of any remaining portion of the Fee.

4. RELEASE OF CLAIMS.

(a) General Release. As part of the consideration given to the Company for the
benefits of this Agreement, Consultant, on behalf of himself and his successors
and assigns, hereby releases the Company and its officers, directors, employees,
agents and attorneys and any parent, subsidiary, affiliated or related companies
and their respective successors and assigns (“Released Parties”) from all
claims, demands, actions or other legal responsibilities of any kind which
Consultant may have based on, or pertaining to his employment with the Company
and the termination of such employment. THIS RELEASE IS A GENERAL RELEASE. This
release (“Release”) includes, but is not limited to, any claims Consultant may
have for wages, bonuses, equity compensation, or other compensation due, claims
under the Age Discrimination in Employment Act arising on or before the date
Consultant signs this Agreement, Title VII of the Civil Rights Act, as amended,
which prohibits discrimination in employment based on race, color, sex, religion
or national origin, the Americans with Disabilities Act, the Family and Medical
Leave Act, the Employee Retirement Income Security Act, or any other federal,
state or local law or regulation affecting employment rights or prohibiting
employment discrimination. This Release also includes any claim for intentional
or negligent infliction of emotional distress, hostile workplace, wrongful
discharge, violation of any public policy or statute, breach of any implied or
express contract between the Company and Consultant, any policy of the Company
or any remedy for any such claim or breach. Consultant understands that the
release of claims set forth in this Section 4(a) covers both known and unknown
claims. This Release shall survive the termination of this Agreement.

(b) Right to Review and Revoke Release. Consultant acknowledges that he has been
given a period of over twenty-one (21) days within which to consider whether to
sign this Agreement and give the Release; that he has been encouraged to consult
with an attorney before signing this Agreement, and that he has done so to the
extent he so desires; and that he has freely elected to sign this Agreement on
the date set forth below. This Agreement and the Release may be revoked by
Consultant within the seven (7) calendar days following the date on which
Consultant signed this Agreement by Consultant’s delivering a written, signed
and dated notice of such revocation to the Company within such seven
(7) calendar day period. After the expiration of said seven (7) calendar days,
the Release shall become final and irrevocable.

(c) Complete Bar to Suit. Consultant acknowledges that upon the Release becoming
final and irrevocable, it shall act as a complete bar against any claim released
by Consultant.

 

5

--------------------------------------------------------------------------------

Consultant promises that he shall never file a lawsuit or initiate any other
proceeding asserting any such released claim or permit any person to file such a
claim on his behalf. Consultant warrants that he has not assigned to any other
person or entity the claims which are the subject of the Release.

5. FINAL RELEASE OF CLAIMS. Prior to receiving any final payment of the Fee
hereunder, Consultant shall execute a final release (the “Final Release”)
releasing any claims that may have accrued in the period following the execution
of this Agreement. Such Final Release shall be substantially identical to the
Release, as set forth in Section 4(a) above, except that the Final Release shall
recite that Consultant thereby releases any claims “Consultant may have based
on, or pertaining to his engagement as a consultant with the Company and the
termination of such engagement.”

6. PROPERTY, DOCUMENTS AND RECORDS. All keys, apparatus, equipment and other
physical property, and documents and records, whether in electronic, paper or
other form, that are provided to Consultant by the Company or are otherwise made
available, loaned or furnished to Consultant in connection with his prior
employment or engagement as a Consultant by the Company shall be and remain the
sole property of the Company, shall be used by Consultant solely for the benefit
of the Company, and shall be returned to the Company immediately upon the
termination of Consultant’s engagement or as and when requested by the Company.

7. NON-DISPARAGEMENT, CONFIDENTIALITY & COOPERATION. Both parties agree to
refrain from making any disparaging remarks about one another to third parties.
For purposes of this Agreement, the term “disparage” includes, but is not
limited to, comments or statements to the press or media, to the Company’s
employees, or to any individual or entity with whom the Company has a business
relationship, and that could adversely affect the conduct of the business of the
Company or its reputation.

Consultant specifically agrees to keep the terms of this Agreement completely
confidential, except that the Consultant may discuss the Agreement with any
governmental agency or Consultant’s attorney, accountant and immediate family,
provided that they agree to keep the contents of this Agreement confidential.
Consultant specifically agrees that because the degree of damages is difficult
to calculate if Consultant breaches this confidentiality provision, the Company
may seek immediate injunctive relief as well as other legal remedies as
available.

Consultant further agrees to cooperate with the Company regarding any matters
relating to Consultant’s prior employment with the Company and to notify the
Company if Consultant is subpoenaed or called to speak about Consultant’s
employment, and not to discuss Consultant’s employment without first notifying
the Company and complying with this Agreement. Consultant agrees that he has not
and will not remove or take any proprietary or confidential information from the
Company and that Consultant has returned or will return all Company property as
soon as possible, but no later than Consultant’s termination of employment with
the Company.

8. NON-SOLICITATION OF CUSTOMERS AND EMPLOYEES; NON-COMPETITION.

(a) Non-Solicitation of Customers. Unless otherwise concurred to in writing by
the Company’s Authorized Representative, during Consultant’s engagement by the
Company under this Agreement and for a period of six months thereafter,
Consultant shall not directly or indirectly, individually or on behalf of any
other person or entity, whether as principal, agent, stockholder, employee,
consultant, representative or in any other capacity, contact any person or
entity, which:

 

6

--------------------------------------------------------------------------------

(1) is a customer or client of the Company or any of its affiliates as of the
Termination Date; or

(2) has been a customer or client of the Company or any of its affiliates at any
time within two (2) years prior to the Termination Date; or

(3) is a prospective customer or client that the Company or any of its
affiliates is actively soliciting as of the Termination Date,

for the purpose of selling products or services similar to any of the products
and services offered for sale by the Company as of the Termination Date.

(b) Covenant Not to Solicit Employees. Unless otherwise concurred to in writing
by the Company’s Authorized Representative, during Consultant’s engagement by
the Company under this Agreement and for a period of six months thereafter,
Consultant shall not directly or indirectly, individually or on behalf of any
other person or entity, whether as principal, agent, stockholder, employee,
consultant, representative or in any other capacity:

(1) recruit, solicit or encourage any person to leave the employ of the Company
or any of its affiliates; or

(2) hire or retain any employee of the Company or any of its affiliates as a
regular employee, consultant, independent contractor or otherwise.

(c) Non-Competition. Consultant recognizes and acknowledges the competitive and
proprietary nature of the business operations of the Company and its affiliates.
During Consultant’s engagement with the Company, Consultant shall not, without
the prior written consent of the Company, for himself or on behalf of any other
person or entity, directly or indirectly, whether as principal, agent,
stockholder, employee, consultant, representative or in any other capacity, own,
manage, operate or control, or be concerned, connected or employed by, or
otherwise associate in any manner with, engage in or have a financial interest
in any business that competes with the business operations of the Company or any
of its affiliates, except that (i) nothing contained herein shall preclude the
Consultant from purchasing or owning stock in any such competitive business if
such stock is publicly traded, and provided that his holdings are less than five
percent (5%) of the issued and outstanding capital stock of such business; and
(ii) the following activities shall not be deemed to be competitive with the
business operations of the Company or its affiliates: participation by
Consultant in the financial, engineering and/or technical affairs of a for
profit or non-profit entity in the State of Hawaii engaged in the generation and
sale of electric energy and/or the development and implementation of energy
efficiency programs and systems and/or the financing of or investing in such
entities. Notwithstanding the foregoing and without limitation, and unless
otherwise concurred to in writing by the Company’s Authorized Representative,
Consultant shall not, directly or indirectly, participate in or represent any
entity in: (a) the preparation and negotiation of contractual agreements with
the Company or its affiliates; or (b) the preparation and management of any
adjudicative proceeding (court, governmental or administrative) involving or
against the Company or its affiliates.

9. EQUITABLE RELIEF. In addition to, and not in limitation of, any other remedy
which may be available with respect to a breach of this Agreement by Consultant,
the Company shall be entitled to equitable relief with respect to violations of
Sections 6, 7 and 8, hereof. Such right to equitable relief shall survive the
termination of this Agreement.

10. IT ASSISTANCE. The Company shall, if necessary and at Consultant’s
reasonable request, provide limited assistance from its information technology
staff to help Consultant transfer appropriate personal computer files from
Company-owned computers to Consultant’s privately-owned computer. This
assistance shall be without charge to Consultant.

 

7

--------------------------------------------------------------------------------

11. INDEMNIFICATION. Consultant agrees to indemnify, defend and hold the
Released Parties harmless from and against any claim, demand, cause of action,
lawsuit, damages or judgment asserted, filed or obtained by Consultant or any
person acting on Consultant’s behalf with respect to any Claim subject to the
Release, including costs and attorney fees, and further agree that they shall
not bring, commence, institute, maintain or prosecute any action at law or
proceeding in equity or any proceeding whatsoever based in whole or in part upon
any Claim subject to the Release. Such right to indemnification shall survive
the termination of this Agreement.

12. TAX EFFECTS. The Company makes no representation as to whether or not any
payments received by Consultant hereunder will be treated as includible in or
excludable from gross income for purposes of any tax.

13. WAIVERS. If any Party to this Agreement shall waive any breach of any
provision of this Agreement, he, she or it shall not thereby be deemed to have
waived any preceding or succeeding breach of the same or any other provision of
this Agreement.

14. COUNTERPARTS. This Agreement may be executed in one or more counterparts,
each of which shall be deemed to be an original, but all of which together shall
constitute one and the same instrument. The execution of this Agreement may be
evidenced by signature transmitted by facsimile or by emailed scan, with
original signatures to follow; provided, however, that if originals are not so
provided, the signature transmitted by facsimile or emailed scan shall be for
all purposes treated as an original signature.

15. GOVERNING LAW. This Agreement shall be governed by, interpreted, construed,
applied and enforced in accordance with the laws of the State of Hawaii, without
reference to its conflict of laws provisions. Any action to enforce the terms of
this Agreement shall be brought in a court of competent jurisdiction in the
State of Hawaii, which shall have exclusive jurisdiction in any legal action
that may arise under this Agreement.

16. HEADINGS, NUMBER AND GENDER. The headings are for the convenience of the
parties, and shall not be considered in construing this Agreement. Feminine or
neuter pronouns shall be substituted for those of masculine form or vice versa,
and the plural shall be substituted for the singular number or vice versa, in
the place or places herein where the context may require such substitution.

17. SEVERABILITY. If 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, and this Agreement shall
thereupon be reformed, construed and enforced to the maximum extent permitted by
applicable law.

18. NOTICES. Any notice, consent, request or demand required or permitted to be
given under the provisions of this Agreement shall be in writing, and shall be
signed by the party giving or making the same. Such notice, consent, request or
demand may be hand delivered, but if it is mailed to a Party, it shall be sent
by electronic mail, United States mail, or other nationally recognized courier,
postage prepaid, addressed to such Party’s last known address. The date of such
mailing shall be deemed the date of notice, consent, request or demand.

Notices to Consultant shall be addressed as follows:

 

8

--------------------------------------------------------------------------------

Thomas L. Joaquin

91-1005 Kanihaalilo St.

Kapolei, HI 96707-3011

Notices to the Company shall be addressed as follows:

Robert A. Alm

Executive Vice President, Public Affairs

Hawaiian Electric Company, Inc.

900 Richards St.

Honolulu, HI 96813

19. AUTHORIZED REPRESENTATIVE. The Company’s Authorized Representative for
purposes of this Agreement shall be the Company’s President and Chief Executive
Officer, any Executive Vice President of the Company, or such person as may be
designated in writing by the Company’s President and Chief Executive Officer.

20. RESOLUTION OF DISPUTES. Any controversy or claim arising out of or relating
to this Agreement or the breach thereof, except a violation of confidentiality
under Section 7 above (for which the remedy to seek immediate injunctive relief
shall be preserved), shall be resolved by submitting the issue to confidential
and binding arbitration in Honolulu pursuant to the rules and procedures of
Dispute Prevention & Resolution of Hawaii, each party to bear its/his/her own
costs subject to the award of the arbitrator.

21. TIME IS OF THE ESSENCE. Time is of the essence with respect to all
provisions of this Agreement specifying a time for performance, including
Section 4.

22. ENTIRE AGREEMENT; AMENDMENT. This Agreement constitutes the entire agreement
of the Parties in respect of the subject matter described herein and supersedes
any previous agreement. This Agreement may not be changed or modified except by
an agreement in writing signed by the Parties hereto.

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date
first above written.

 

/s/ Thomas L. Joaquin

Thomas L. Joaquin “Consultant” HAWAIIAN ELECTRIC COMPANY, INC. By  

/s/ Richard M. Rosenblum

Its: President & CEO

 

9