Exhibit 10.37

 

MUTUAL RELEASE AND SEVERANCE AGREEMENT

 

This Mutual Release and Severance Agreement (hereafter “Agreement”) dated as of
February 22, 2008, is hereby entered into between Michael S. Ruley
(“Executive”), and Hawaiian Telcom Holdco, Inc., a Delaware corporation (the
“Employer”).

 

WHEREAS, Employer and Executive entered into an Employment Agreement dated
October 1, 2004 (the “Employment Agreement”);

 

WHEREAS, Employer and Executive entered into a Non-Qualified Stock Option
Agreement dated November 8, 2005 (the “Stock Option Agreement”) pursuant to the
terms of the Stock Option Plan of Hawaiian Telcom Holdco, Inc. (the “Stock
Option Plan”);

 

WHEREAS, Employer, Executive and certain other parties thereto entered into an
Amended and Restated Limited Partnership Agreement dated May 13, 2005 (the “LP
Agreement”); and

 

WHEREAS, Executive and Employer have agreed that Executive shall terminate his
employment from the Employer under the terms hereof.

 

NOW THEREFORE, in exchange for the good and valuable consideration set forth
herein, the adequacy of which is specifically acknowledged, Executive and
Employer (the “parties”) hereby agree as follows:

 

1.                                       TERMINATION OF EMPLOYMENT. EXECUTIVE
ACKNOWLEDGES THAT HIS EMPLOYMENT WITH EMPLOYER SHALL TERMINATE EFFECTIVE AS OF
FEBRUARY 4, 2008 (THE “TERMINATION DATE”). EXECUTIVE’S TERMINATION WILL BE
CLASSIFIED BY EMPLOYER AS A VOLUNTARY RESIGNATION.

 

2.                                       SEVERANCE PAYMENTS.

 

(A)                                  NO LATER THAN FIFTEEN DAYS AFTER EXECUTIVE
TENDERS TO THE EMPLOYER A SIGNED MUTUAL RELEASE IN THE FORM OF EXHIBIT A,
PROVIDED THAT SUCH TENDER OCCURS NO EARLIER THAN THE TERMINATION DATE AND NO
LATER THAN FEBRUARY 28, 2008 AND THAT SUCH MUTUAL RELEASE HAS NOT BEEN REVOKED
BY EXECUTIVE, THE EMPLOYER WILL PAY EXECUTIVE THE FOLLOWING AMOUNTS, LESS
APPLICABLE WITHHOLDINGS:

 

(1)                                  $1,117,272;

 

(2)                                  ANY BONUS WHICH HAS BEEN DECLARED OR EARNED
BUT NOT YET PAID FOR FISCAL YEAR 2007;

 

(3)                                  $71,340 (WITH RESPECT TO EXECUTIVE’S ANNUAL
COLA PAYMENT FOR 2007);

 

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(4)                                  ANY BUSINESS EXPENSES INCURRED BY THE
EXECUTIVE IN ACCORDANCE WITH THE EMPLOYER’S POLICIES NOT YET PAID TO THE
EXECUTIVE;

 

(5)                                  THE VALUE OF ALL ACCRUED, UNUSED VACATION
DAYS BASED ON EXECUTIVE’S SERVICE TO THE EMPLOYER WHICH THE PARTIES AGREE IS
320.33 HOURS;

 

(6)                                  ANY OTHER AMOUNTS DUE TO THE EXECUTIVE
ARISING FROM THE EXECUTIVE’S PARTICIPATION IN, OR BENEFITS UNDER, ANY EMPLOYEE
BENEFIT PLANS, PROGRAMS OR ARRANGEMENTS; PLUS

 

(7)                                  $20,000 (WITH RESPECT TO ACCRUED BUT UNUSED
AIRFARE BETWEEN HONOLULU AND THE UNITED STATES MAINLAND) (THE “AIRFARE
PAYMENT”).

 

(b)                                 No earlier than thirty days after Executive
tenders to the Employer a signed Mutual Release in the form of Exhibit A,
provided that such tender occurs no earlier than the Termination Date and no
later than February 28, 2008 and that such Mutual Release has not been revoked
by Executive, the Employer will pay Executive within 30 days of Executive
submitting expenses to Employer for payment the following amounts, less
applicable withholdings:

 

(1)                                  PURSUANT TO SECTION 3(F) OF THE EMPLOYMENT
AGREEMENT AND AS OUTLINED IN THE COMPANY’S EXECUTIVE RELOCATION BENEFITS PLAN,
REIMBURSEMENT FOR ALL RELOCATION EXPENSES (“RELOCATION REIMBURSEMENT”) INCURRED
BY THE EXECUTIVE DUE TO HIS RELOCATION BACK TO THE MAINLAND UNITED STATES AT A
LOCATION OF HIS CHOICE, INCLUDING PAYMENT  OF UP TO A 6% REAL ESTATE BROKER
COMMISSION FEE (“HAWAIIAN BROKER FEE”) PAID BY THE EXECUTIVE ON THE SALE OF HIS
HAWAIIAN RESIDENCE, PLUS AN ADDITIONAL PAYMENT IN AN AMOUNT SUCH THAT, AFTER
PAYMENT BY THE EXECUTIVE OF ALL THE INCOME TAXES IMPOSED ON THE RELOCATION
REIMBURSEMENT AND THE ADDITIONAL PAYMENT, THE EXECUTIVE WOULD RETAIN AN AMOUNT
EQUAL TO RELOCATION REIMBURSEMENT; AND

 

(2)                                  Reimbursement for any lease termination
penalties (“Lease Reimbursement”) incurred by Executive pursuant to
Section 3(i) of the Employment Agreement (but subject to the limitations
contained therein) plus an additional payment in an amount such that, after
payment by the Executive of all the income taxes imposed on the Lease
Reimbursement and the additional payment, the Executive would retain an amount
equal to Lease Reimbursement.

 

3.                                       CONTINUED MEDICAL BENEFITS. FOLLOWING
THE TERMINATION DATE, EMPLOYER SHALL CONTINUE COVERAGE (AT THE COMPANY’S
EXPENSE) FOR EXECUTIVE AND HIS DEPENDENTS UNDER ALL COMPANY GROUP HEALTH BENEFIT
PLANS IN WHICH EXECUTIVE AND ANY DEPENDENTS WERE ENTITLED TO PARTICIPATE
IMMEDIATELY PRIOR TO THE TERMINATION DATE (UNDER THE SAME TERMS AS DURING
EMPLOYMENT), INCLUDING HMSA MEDICAL PLAN, HDS DENTAL PLAN, HMSA VISION PLAN, AND
EXEC U CARE SUPPLEMENTAL PLAN, FOR TWELVE MONTHS FROM THE TERMINATION DATE,
WHICH PERIOD SHALL BE CO-EXTENSIVE WITH THE PERIOD OF COVERAGE WITH RESPECT TO
EXECUTIVE UNDER COBRA. . THEREAFTER, EXECUTIVE SHALL BE ELIGIBLE FOR SUCH
CONTINUED COVERAGE AT HIS OWN EXPENSE FOR THE REMAINDER OF THE APPLICABLE COBRA
COVERAGE PERIOD. EXCEPT AS PROVIDED IN SECTIONS 1, 2, 3, 5 AND 7 HEREOF OR BY
APPLICABLE LAW OR PLAN DOCUMENTS, ALL OTHER COMPENSATION, BENEFITS OR
PERQUISITES SHALL CEASE UPON THE TERMINATION DATE.

 

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4.                                       CONTINUED EFFECT OF EMPLOYMENT
AGREEMENT. THE TERMS AND CONDITIONS OF SECTIONS 6 THROUGH 10 OF THE EMPLOYMENT
AGREEMENT SHALL REMAIN IN FULL FORCE AND EFFECT FOR THE APPLICABLE PERIODS OF
TIME INDICATED.

 

5.                                       EQUITY IN EMPLOYER. EXECUTIVE SHALL BE
ENTITLED TO EXERCISE ALL OF HIS VESTED STOCK OPTIONS THROUGH THE THIRTIETH DAY
FOLLOWING THE TERMINATION DATE IN ACCORDANCE WITH THE TERMS OF THE STOCK OPTION
AGREEMENT AND STOCK OPTION PLAN.

 

6.                                       RESIDUAL DUTIES. THE PARTIES AGREE AND
INTEND THAT ANY AND ALL DUTIES OF LOYALTY, FIDELITY, AND CONFIDENTIALITY RUNNING
FROM EXECUTIVE TO EMPLOYER AND ARISING OUT OF THE COMMON LAW AS A CONSEQUENCE OF
THE PARTIES’ EMPLOYMENT RELATIONSHIP SHALL CONTINUE IN FULL FORCE AND EFFECT
BETWEEN THE PARTIES UNTIL THE TERMINATION DATE; PROVIDED, HOWEVER, THAT NEITHER
THIS PARAGRAPH NOR ANY OTHER PORTION OF THIS AGREEMENT SHALL BE INTERPRETED TO
DIMINISH ANY RESIDUAL DUTIES OR OBLIGATIONS OF EXECUTIVE TO EMPLOYER THAT MAY
ARISE OR CONTINUE IN EFFECT UNDER THE COMMON LAW AFTER THE TERMINATION DATE.

 

7.                                       ATTORNEYS’ FEES. EXECUTIVE SHALL BE
REIMBURSED FOR REASONABLE ATTORNEYS’ FEES AND COSTS INCURRED IN CONNECTION WITH
THE NEGOTIATION AND EXECUTION OF THIS AGREEMENT IN AN AMOUNT NOT TO EXCEED
$4,500.

 

8.                                       NO OTHER PAYMENTS. EXECUTIVE
UNDERSTANDS AND AGREES THAT EMPLOYER SHALL MAKE NO OTHER PAYMENTS TO EXECUTIVE,
AND SHALL HAVE NO OTHER OBLIGATIONS TO EXECUTIVE EXCEPT AS DESCRIBED IN THIS
AGREEMENT OR AS OTHERWISE REQUIRED BY LAW OR PLAN DOCUMENTS.

 

9.                                       TAXES. TO THE EXTENT ANY TAXES MAY BE
DUE ON THE PAYMENTS TO EXECUTIVE PROVIDED IN THIS AGREEMENT BEYOND ANY WITHHELD
BY EMPLOYER, EXECUTIVE AGREES TO PAY THEM HIMSELF AND TO INDEMNIFY AND HOLD
EMPLOYER AND OTHER ENTITIES RELEASED BY EXECUTIVE PURSUANT TO THE TERMS HEREOF
(INCLUDING EXHIBIT A)  HARMLESS FOR ANY TAX CLAIMS OR PENALTIES RESULTING FROM
SUCH PAYMENTS. EXECUTIVE FURTHER AGREES TO PROVIDE ANY AND ALL INFORMATION
PERTAINING TO EXECUTIVE UPON REQUEST AS REASONABLY NECESSARY FOR EMPLOYER AND
OTHER ENTITIES SO RELEASED TO COMPLY WITH APPLICABLE TAX LAWS.

 

10.                                 SEVERABILITY. EXCEPT AS OTHERWISE SPECIFIED
BELOW, SHOULD ANY PORTION OF THIS AGREEMENT BE FOUND VOID OR UNENFORCEABLE FOR
ANY REASON BY A COURT OF COMPETENT JURISDICTION, THE COURT SHOULD ATTEMPT TO
LIMIT OR OTHERWISE MODIFY SUCH PROVISION SO AS TO MAKE IT ENFORCEABLE, AND IF
SUCH PORTION CANNOT BE MODIFIED TO BE ENFORCEABLE, THE UNENFORCEABLE PORTION
SHALL BE DEEMED SEVERED FROM THE REMAINING PORTIONS OF THIS AGREEMENT, WHICH
SHALL OTHERWISE REMAIN IN FULL FORCE AND EFFECT. IF ANY PORTION OF THIS
AGREEMENT IS SO FOUND TO BE VOID OR UNENFORCEABLE FOR ANY REASON IN REGARD TO
ANY ONE OR MORE PERSONS, ENTITIES, OR SUBJECT MATTERS, SUCH PORTION SHALL REMAIN
IN FULL FORCE AND EFFECT WITH RESPECT TO ALL OTHER PERSONS, ENTITIES, AND
SUBJECT MATTERS. IN THE EVENT EXECUTIVE SHOULD IN THE FUTURE CONTEND THAT
EXECUTIVE’S RELEASE OF CLAIMS PURSUANT TO EXHIBIT A IS FOR ANY REASON VOID,
IMPERFECT, OR INCOMPLETE, EXECUTIVE MAY NOT PURSUE ANY CLAIM AGAINST EMPLOYER
(OR ANY OTHER PARTY INTENDED TO BE RELEASED THEREBY) TO ESTABLISH THE INVALIDITY
OF THE RELEASE OR PREMISED (IN WHOLE OR IN PART) ON THE INVALIDITY OF THE
RELEASE BEFORE OR WITHOUT REPAYING TO EMPLOYER THE FULL AMOUNT OF SUCH CASH
PAYMENTS HE HAS RECEIVED, LESS THE REASONABLE VALUE OF SERVICES ACTUALLY
PROVIDED PURSUANT TO THIS AGREEMENT, AND APPLICABLE STATUTES OF LIMITATIONS
SHALL BE DEEMED TO RUN IN REGARD TO EXECUTIVE’S CLAIMS WITHOUT REGARD TO THE
PARTIES’ ENTRY INTO THIS AGREEMENT. THE PRECEDING SENTENCE SHALL NOT OPERATE TO
LIMIT THE SCOPE OR EFFECT OF EXECUTIVE’S COVENANT NOT TO SUE.

 

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11.                                 UNDERSTANDING AND AUTHORITY. THE PARTIES
UNDERSTAND AND AGREE THAT ALL TERMS OF THIS AGREEMENT ARE CONTRACTUAL AND ARE
NOT A MERE RECITAL, AND REPRESENT AND WARRANT THAT THEY ARE COMPETENT TO
COVENANT AND AGREE AS HEREIN PROVIDED.

 

12.                                 INTERNAL REVENUE CODE SECTION 409A. CERTAIN
PAYMENTS AND BENEFITS PAYABLE UNDER THIS AGREEMENT ARE INTENDED TO COMPLY WITH
THE REQUIREMENTS OF SECTION 409A OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (THE “CODE”). CERTAIN PAYMENTS AND BENEFITS PAYABLE UNDER THIS AGREEMENT
ARE INTENDED TO BE EXEMPT FROM THE REQUIREMENTS OF SECTION 409A OF THE CODE.
THIS AGREEMENT SHALL BE INTERPRETED IN ACCORDANCE WITH THE APPLICABLE
REQUIREMENTS OF, AND EXEMPTIONS FROM, SECTION 409A OF THE CODE AND THE TREASURY
REGULATIONS THEREUNDER. TO THE EXTENT THE PAYMENTS AND BENEFITS UNDER THIS
AGREEMENT ARE SUBJECT TO SECTION 409A OF THE CODE, THIS AGREEMENT SHALL BE
INTERPRETED, CONSTRUED AND ADMINISTERED IN A MANNER THAT SATISFIES THE
REQUIREMENTS OF SECTIONS 409A(A)(2), (3) AND (4) OF THE CODE AND THE TREASURY
REGULATIONS THEREUNDER (SUBJECT TO THE TRANSITIONAL RELIEF UNDER INTERNAL
REVENUE SERVICE NOTICE 2005-1, THE PROPOSED REGULATIONS UNDER SECTION 409A OF
THE CODE, INTERNAL REVENUE SERVICE NOTICE 2006-79, INTERNAL REVENUE SERVICE
NOTICE 2007-78 AND OTHER APPLICABLE AUTHORITY ISSUED BY THE INTERNAL REVENUE
SERVICE). AS PROVIDED IN INTERNAL REVENUE NOTICE 2007-78, NOTWITHSTANDING ANY
OTHER PROVISION OF THIS AGREEMENT, WITH RESPECT TO AN ELECTION OR AMENDMENT TO
CHANGE A TIME OR FORM OF PAYMENT UNDER THIS AGREEMENT MADE ON OR AFTER
JANUARY 1, 2008 AND ON OR BEFORE DECEMBER 31, 2008, THE ELECTION OR AMENDMENT
SHALL APPLY ONLY WITH RESPECT TO PAYMENTS THAT WOULD NOT OTHERWISE BE PAYABLE IN
2008 AND SHALL NOT CAUSE PAYMENTS TO BE PAID IN 2008 THAT WOULD NOT OTHERWISE BE
PAYABLE IN 2008. IF THE EMPLOYER AND THE EXECUTIVE DETERMINE THAT ANY
COMPENSATION, BENEFITS OR OTHER PAYMENTS THAT ARE PAYABLE UNDER THIS AGREEMENT
AND INTENDED TO COMPLY WITH SECTIONS 409A(A)(2), (3) AND (4) OF THE CODE DO NOT
COMPLY WITH SECTION 409A OF THE CODE, THE TREASURY REGULATIONS THEREUNDER AND
OTHER APPLICABLE AUTHORITY ISSUED BY THE INTERNAL REVENUE SERVICE, THE EMPLOYER
AND THE EXECUTIVE AGREE TO AMEND THIS AGREEMENT, OR TAKE SUCH OTHER ACTIONS AS
THE EMPLOYER AND THE EXECUTIVE DEEM REASONABLY NECESSARY OR APPROPRIATE, TO
COMPLY WITH THE REQUIREMENTS OF SECTION 409A OF THE CODE, THE TREASURY
REGULATIONS THEREUNDER AND OTHER APPLICABLE AUTHORITY ISSUED BY THE INTERNAL
REVENUE SERVICE, WHILE PRESERVING THE ECONOMIC AGREEMENT OF THE PARTIES. IN THE
CASE OF ANY COMPENSATION, BENEFITS OR OTHER PAYMENTS THAT ARE PAYABLE UNDER THIS
AGREEMENT AND INTENDED TO COMPLY WITH SECTIONS 409A(A)(2), (3) AND (4) OF THE
CODE, IF ANY PROVISION OF THE AGREEMENT WOULD CAUSE SUCH COMPENSATION, BENEFITS
OR OTHER PAYMENTS TO FAIL TO SO COMPLY, SUCH PROVISION SHALL NOT BE EFFECTIVE
AND SHALL BE NULL AND VOID WITH RESPECT TO SUCH COMPENSATION, BENEFITS OR OTHER
PAYMENTS, AND SUCH PROVISION SHALL OTHERWISE REMAIN IN FULL FORCE AND EFFECT.
CONSISTENT WITH THE FOREGOING, THE PARTIES INTEND THAT THE TERMINATION DATE
SHALL BE THE DATE OF THE EXECUTIVE’S “SEPARATION FROM THE SERVICE” WITH THE
EMPLOYER WITHIN THE MEANING OF CODE SECTION 409A(A)(2)(A)(I).

 

13.                                 MUTUAL RELEASE. EXECUTIVE UNDERSTANDS,
AGREES AND REPRESENTS THAT THE COVENANTS MADE HEREIN AND THE MUTUAL RELEASE TO
BE EXECUTED BY BOTH PARTIES PURSUANT TO EXHIBIT A MAY AFFECT RIGHTS AND
LIABILITIES OF SUBSTANTIAL EXTENT AND AGREES THAT THE COVENANTS AND RELEASES
PROVIDED HEREIN ARE IN EXECUTIVE’S BEST INTEREST. EXECUTIVE REPRESENTS AND
WARRANTS THAT IN NEGOTIATING AND EXECUTING THIS AGREEMENT EXECUTIVE HAS HAD AN
ADEQUATE OPPORTUNITY TO CONSULT WITH COMPETENT LEGAL COUNSEL OF HIS CHOOSING
CONCERNING THE MEANING AND EFFECT OF EACH TERM AND PROVISION HEREOF, AND THAT
THERE ARE NO REPRESENTATIONS, PROMISES, OR AGREEMENTS BETWEEN EMPLOYER AND
EXECUTIVE OTHER THAN THOSE EXPRESSLY SET FORTH IN WRITING HEREIN.

 

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14.                                 Governing Law. This Agreement shall be
governed by the laws of the State of New York, without reference to conflicts of
law principles.

 

15.                                 Entire Agreement. This Agreement, including
Exhibit A attached hereto, and the Consulting Agreement of even date, embody the
entire agreement between the parties with regard to its subject matter. This
Agreement supersedes any and all prior agreements and understandings between the
parties with respect to its subject matter.

 

16.                                 Amendments. This Agreement may not be
amended or changed except by a written agreement signed by both parties.

 

17.                                 Successors and Assigns. This Agreement shall
be binding on the parties and their respective successors and assigns.

 

The parties have carefully read this Agreement in its entirety; fully understand
and agree to its terms and provisions; and intend and agree that it is final and
binding on all parties.

 

[signature page follows]

 

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IN WITNESS WHEREOF, and intending to be legally bound, the parties have executed
the foregoing on the dates shown below.

 

 

HAWAIIAN TELECOM HOLDCO, INC.

MICHAEL S. RULEY

 

 

 

 

By:

/s/ Alan M. Oshima

 

/s/ Michael S. Ruley

 

 

 

 

Print Name:

Alan M. Oshima

 

Date:

February 22, 2008

 

 

 

 

Title:

SVP, General Counsel & Secretary

 

 

 

 

 

 

Date:

February 25, 2008

 

 

 

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EXHIBIT A

 

MUTUAL RELEASE

 

This Mutual Release (hereafter “Agreement”), dated February         , 2008 is
hereby entered into between Michael S. Ruley (“Executive”), and Hawaiian Telcom
Holdco, Inc., a Delaware corporation (the “Employer”).

 

WHEREAS, Employer and Executive entered into a Mutual Release and Severance
Agreement (the “Severance Agreement”) dated February 22, 2008, which Agreement
contemplates the Execution of this Mutual Release.

 

THEREFORE, in exchange for the good and valuable consideration set forth herein,
the adequacy of which is specifically acknowledged, Executive and Employer (the
parties”) hereby agree as follows:

 

1.                                       GENERAL RELEASE OF CLAIMS BY EXECUTIVE.
EXECUTIVE AGREES FOR EXECUTIVE, EXECUTIVE’S SPOUSE AND CHILD OR CHILDREN (IF
ANY), EXECUTIVE’S HEIRS, BENEFICIARIES, DEVISEES, EXECUTORS, ADMINISTRATORS,
ATTORNEYS, PERSONAL REPRESENTATIVES, SUCCESSORS AND ASSIGNS, HEREBY FOREVER TO
RELEASE, DISCHARGE, AND COVENANT NOT TO SUE EMPLOYER, EMPLOYER’S PAST, PRESENT,
OR FUTURE PARENT, AFFILIATED, RELATED, AND/OR SUBSIDIARY ENTITIES (COLLECTIVELY
“AFFILIATES”), AND ALL OF THEIR PAST AND PRESENT DIRECTORS, SHAREHOLDERS,
OFFICERS, GENERAL OR LIMITED PARTNERS, EMPLOYEES, AGENTS, AND ATTORNEYS, AND
AGENTS AND REPRESENTATIVES OF SUCH ENTITIES, AND EMPLOYEE BENEFIT PLANS IN WHICH
EXECUTIVE IS OR HAS BEEN A PARTICIPANT BY VIRTUE OF HIS EMPLOYMENT WITH
EMPLOYER, FROM ANY AND ALL CLAIMS, DEBTS, DEMANDS, ACCOUNTS, JUDGMENTS, RIGHTS,
CAUSES OF ACTION, EQUITABLE RELIEF, DAMAGES, COSTS, CHARGES, COMPLAINTS,
OBLIGATIONS, PROMISES, AGREEMENTS, CONTROVERSIES, SUITS, EXPENSES, COMPENSATION,
RESPONSIBILITY AND LIABILITY OF EVERY KIND AND CHARACTER WHATSOEVER (INCLUDING
ATTORNEYS’ FEES AND COSTS), WHETHER IN LAW OR EQUITY, KNOWN OR UNKNOWN, ASSERTED
OR UNASSERTED, SUSPECTED OR UNSUSPECTED, WHICH EXECUTIVE HAS OR MAY HAVE HAD
AGAINST SUCH ENTITIES BASED ON ANY EVENTS OR CIRCUMSTANCES ARISING OR OCCURRING
ON OR PRIOR TO THE TERMINATION DATE (OR, WITH RESPECT TO CLAIMS OF
DISPARAGEMENT, ARISING OR OCCURRING ON OR PRIOR TO THE DATE THIS AGREEMENT IS
EXECUTED), ARISING DIRECTLY OR INDIRECTLY OUT OF, RELATING TO, OR IN ANY OTHER
WAY INVOLVING IN ANY MANNER WHATSOEVER, (A) EXECUTIVE’S EMPLOYMENT WITH EMPLOYER
OR THE TERMINATION THEREOF OR (B) THE EXECUTIVE’S STATUS AT ANY TIME AS A HOLDER
OF ANY SECURITIES OF EMPLOYER, AND ANY AND ALL CLAIMS ARISING UNDER FEDERAL,
STATE, OR LOCAL LAWS RELATING TO EMPLOYMENT, OR SECURITIES, INCLUDING WITHOUT
LIMITATION CLAIMS OF WRONGFUL DISCHARGE, BREACH OF EXPRESS OR IMPLIED CONTRACT,
FRAUD, MISREPRESENTATION, DEFAMATION, OR LIABILITY IN TORT, CLAIMS OF ANY KIND
THAT MAY BE BROUGHT IN ANY COURT OR ADMINISTRATIVE AGENCY, ANY CLAIMS ARISING
UNDER TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, THE AGE DISCRIMINATION IN
EMPLOYMENT ACT, THE AMERICANS WITH DISABILITIES ACT, THE FAIR LABOR STANDARDS
ACT, THE EMPLOYEE RETIREMENT INCOME SECURITY ACT, THE FAMILY AND MEDICAL LEAVE
ACT, THE SECURITIES ACT OF 1933, THE SECURITIES EXCHANGE ACT OF 1934, AND
SIMILAR STATE OR LOCAL STATUTES, ORDINANCES, AND REGULATIONS, PROVIDED, HOWEVER,
NOTWITHSTANDING ANYTHING TO THE CONTRARY SET FORTH HEREIN, THAT THIS RELEASE
SHALL NOT EXTEND TO (I) BENEFIT CLAIMS UNDER EMPLOYEE PENSION BENEFIT PLANS IN
WHICH EXECUTIVE IS A PARTICIPANT BY VIRTUE OF HIS EMPLOYMENT WITH  EMPLOYER OR
TO BENEFIT CLAIMS UNDER EMPLOYEE WELFARE BENEFIT PLANS FOR OCCURRENCES (E.G.,
MEDICAL CARE, DEATH, OR ONSET OF DISABILITY) ARISING

 

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AFTER THE EXECUTION OF THIS AGREEMENT BY EXECUTIVE, (II) ANY OBLIGATION ASSUMED
UNDER THIS AGREEMENT BY ANY PARTY HERETO, AND (III) ANY CLAIM FOR
INDEMNIFICATION OR INSURANCE COVERAGE PURSUANT TO SECTION 23 OF THE EMPLOYMENT
AGREEMENT.

 

2.                                       GENERAL RELEASE OF CLAIMS BY THE
EMPLOYER. THE EMPLOYER AGREES, FOR THE EMPLOYER, ITS AFFILIATES, AND ALL OF
THEIR PAST AND PRESENT DIRECTORS, SHAREHOLDERS, OFFICERS, GENERAL OR LIMITED
PARTNERS, EMPLOYEES, AGENTS, AND ATTORNEYS, AND AGENTS AND REPRESENTATIVES OF
SUCH ENTITIES, AND EMPLOYEE BENEFIT PLANS IN WHICH EXECUTIVE IS OR HAS BEEN A
PARTICIPANT BY VIRTUE OF HIS EMPLOYMENT WITH EMPLOYER AND ALL OF THEIR
RESPECTIVE PREDECESSORS, SUCCESSORS AND ASSIGNS, TO HEREBY FOREVER TO RELEASE,
DISCHARGE, AND COVENANT NOT TO SUE EXECUTIVE, FROM ANY AND ALL CLAIMS, DEBTS,
DEMANDS, ACCOUNTS, JUDGMENTS, RIGHTS, CAUSES OF ACTION, EQUITABLE RELIEF,
DAMAGES, COSTS, CHARGES, COMPLAINTS, OBLIGATIONS, PROMISES, AGREEMENTS,
CONTROVERSIES, SUITS, EXPENSES, COMPENSATION, RESPONSIBILITY AND LIABILITY OF
EVERY KIND AND CHARACTER WHATSOEVER (INCLUDING ATTORNEYS’ FEES AND COSTS),
WHETHER IN LAW OR EQUITY, KNOWN OR UNKNOWN, ASSERTED OR UNASSERTED, SUSPECTED OR
UNSUSPECTED, WHICH THE EMPLOYER HAS OR MAY HAVE HAD AGAINST EXECUTIVE BASED ON
ANY EVENTS OR CIRCUMSTANCES ARISING OR OCCURRING ON OR PRIOR TO THE TERMINATION
DATE, INCLUDING WITHOUT LIMITATION ANY AND ALL CLAIMS ARISING OUT OF EXECUTIVE’S
EMPLOYMENT WITH THE COMPANY OR THE TERMINATION THEREOF PROVIDED, HOWEVER,
NOTWITHSTANDING ANYTHING TO THE CONTRARY SET FORTH HEREIN, THAT THIS RELEASE
SHALL NOT EXTEND TO (A) ANY CLAIM WHICH RELATES TO OR ARISES FROM ANY CRIMINAL
ACTIVITY OF EXECUTIVE, AND (B) ANY OBLIGATION ASSUMED UNDER THIS AGREEMENT BY
ANY PARTY HERETO.

 

3.                                       RELEASE OF AGE DISCRIMINATION CLAIMS;
PERIODS FOR REVIEW AND RECONSIDERATION.

 

(A)                                  EXECUTIVE UNDERSTANDS THAT THIS AGREEMENT
INCLUDES A RELEASE OF CLAIMS ARISING UNDER THE AGE DISCRIMINATION IN EMPLOYMENT
ACT (ADEA). EXECUTIVE UNDERSTANDS AND WARRANTS THAT HE HAS BEEN GIVEN A PERIOD
OF TWENTY-ONE (21) DAYS TO REVIEW AND CONSIDER THIS AGREEMENT. EXECUTIVE IS
HEREBY ADVISED TO CONSULT WITH AN ATTORNEY PRIOR TO EXECUTING THE AGREEMENT. BY
HIS SIGNATURE BELOW, EXECUTIVE WARRANTS THAT HE HAS HAD THE OPPORTUNITY TO DO SO
AND TO BE FULLY AND FAIRLY ADVISED BY THAT LEGAL COUNSEL AS TO THE TERMS OF THE
AGREEMENT. EXECUTIVE FURTHER WARRANTS THAT HE UNDERSTANDS THAT HE MAY USE AS
MUCH OR ALL OF HIS 21-DAY PERIOD AS HE WISHES BEFORE SIGNING, AND WARRANTS THAT
HE HAS DONE SO.

 

(B)                                 EXECUTIVE FURTHER WARRANTS THAT HE
UNDERSTANDS THAT HE HAS SEVEN (7) DAYS AFTER SIGNING THIS AGREEMENT TO REVOKE
THE AGREEMENT BY NOTICE IN WRITING TO JED W. BRICKNER, LATHAM & WATKINS, 885
THIRD AVENUE, SUITE 1000, NEW YORK, N.Y. 10022. THIS AGREEMENT SHALL BE BINDING,
EFFECTIVE, AND ENFORCEABLE UPON BOTH PARTIES UPON THE EXPIRATION OF THIS
SEVEN-DAY REVOCATION PERIOD WITHOUT MR. BRICKNER HAVING RECEIVED SUCH
REVOCATION, BUT NOT BEFORE SUCH TIME.

 

[signature page follows]

 

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IN WITNESS WHEREOF, and intending to be legally bound, the parties have executed
the foregoing on the dates shown below.

 

 

HAWAIIAN TELCOM HOLDCO, INC.

MICHAEL S. RULEY

 

 

 

 

By:

/s/ Alan M. Oshima

 

/s/ Michael S. Ruley

 

 

 

 

 

 

 

 

Print Name:

Alan M. Oshima

 

Date:

February 22, 2008

 

 

 

 

 

 

 

 

Title:

SVP, General Counsel & Secretary

 

 

 

 

 

 

 

 

 

 

Date:

February 25, 2008

 

 

 

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