Document:

exhibit10-mip.htm

    Exhibit
10.15

    

    
      	
               

              2007
      Management Incentive Plan  (MIP)

               

            
	
              Participants

            	
              VP
      Products and Services

              Chief
      Information Officer

              Chief
      Accounting Officer

              VP
      Human Resources

              General
      Counsel

              Senior
      VP Sales  (also participates in Sales Incentive
      Plan)

              Executive
      VP Corporate Sales (also participates in Sales Incentive
Plan)

               

            
	
              Objectives

            	
              Achieve
      corporate performance Shareholders care about

              Drive
      and reward unified performance across exec team

              Focus
      on building trend for long term, profitable growth

               

            
	
              Key
      Achievement Measures for 2007

            	
               

              Achievement
      of Board defined goals around Bookings Growth, Cash Flow Profitability and
      Profitability Objectives.

               

            
	
              Bonus
      Target

               @
      100% Achievement

            	
              VP
      Products and Services     33% of Base
      Salary

              Chief
      Information Officer     33% of Base
      Salary

              Chief
      Accounting Officer     33% of Base
      Salary

              VP
      Human
      Resources           22% of Base
      Salary

              General
      Counsel                   11% of Base
      Salary

              Sr. VP
      Sales                                  $20,000

              Exec. VP Corp.
      Sales                   $20,000

               

            
	
              Terms
      of Achievement and Payment of Incentive Bonus

            	
              All
      three Measures of Success must be achieved

              All
      or Nothing, no partial payment or accelerators

              Bonus
      to be paid upon completion of annual audit and verification of measures
      achieved (approx. January,
2007)Exhibit 10.11

 

SERVICES
AGREEMENT

 

This SERVICES AGREEMENT (the
“Agreement”) dated as of February 4, 2008 is made by and between Hawaiian
Telcom Communications, Inc., a Delaware corporation, on behalf of itself
and its subsidiaries (collectively, “Hawaiian Telcom” or the “Company”) and
Stephen F. Cooper (“Cooper”), Kevin Nystrom (“Nystrom”) and Kroll Zolfo Cooper
LLC (“KZC”), a New Jersey limited liability company, relating to Hawaiian
Telcom and its subsidiaries.

 

Recitals:

 

WHEREAS, the parties hereto desire to enter into this Agreement to set
forth the basis on which Cooper, Nystrom and KZC will perform management
services for the Company, all as set forth more fully in this Agreement.

 

NOW, THEREFORE, in consideration of the premises and covenants set forth
herein, and intending to be legally bound hereby, the parties to this Agreement
hereby agree as follows:

 

1.             Engagement.  The
Company hereby engages Cooper, Nystrom and KZC and Cooper, Nystrom and KZC
hereby accept such engagement, on the terms and conditions set forth in this
Agreement.  The Company is hereby
acquiring from KZC the services of Cooper, Nystrom and additional individuals
to work for the Company (the “Associate Directors”) as set forth below.  Subject to the last sentence of Section 3
with respect to Cooper only, all compensation for the services and actions of
Cooper, Nystrom, KZC and the Associate Directors under this Agreement will be
paid to KZC.

 

2.             Duties.

 

(a)           The
Company represents to Cooper, Nystrom and KZC that its Board of Directors (the “Board”)
has duly adopted the resolution (the “Resolution”) appended hereto and
incorporated herein by reference approving the terms of this Agreement and
electing Cooper as the Chief Executive Officer of the Company and Nystrom as
the Chief Operating Officer of the Company. 
KZC will assign Associate Directors to serve in various capacities with
the Company and to perform other services required of KZC or the Company
hereunder; provided that (i) from the period beginning on the date hereof
and ending on February 29, 2008, no less than two full-time Associate
Directors shall be assigned, and (ii) from the period beginning on March 1,
2008 and through the remainder of the term of this Agreement, no less than
three full-time Associate Directors shall be assigned.  KZC may, with prior written approval from the
Executive Committee of the Board (the “Committee”), utilize employees of KZC’s
parent, Kroll, Inc. and its other subsidiaries.

 

(b)           (i) Pursuant
to and except as limited by the terms of such Resolution, and except as
described in paragraph (b)(ii) below, Cooper, Nystrom and KZC shall be
authorized to make decisions with respect to the management and operation of
the Company’s business, including without limitation organization and human
resources, marketing and sales, logistics,

 

 

finance and
administration and such other areas as they may identify, in such manner as
they deem necessary or appropriate in a manner consistent with the business
judgment rule and the provisions of local law, subject to review and
approval by the Committee in accordance with the Company’s charters, Bylaws,
other governing documents (if any) (collectively the “Constitutive Documents”)
and applicable state law.

 

(ii)           Unless any such action is
being taken in accordance with an annual budget or other action previously
approved by the Board or the Committee, notwithstanding the foregoing and in
addition to any other approval required by the Constitutive Documents or by
applicable law, the approval of the Committee 
shall be required to do any of the following, and none of Cooper,
Nystrom, KZC or the Associate Directors (individually, a “Representative” and
collectively, the “Representatives”) shall take or agree to take any of the
following actions without the approval of the Committee:

 

(1)     Approve the
annual operating or capital budget of the Company, modify in any material
respect any such budget or take any action that is or would be reasonably
likely to be in material variance therefrom.

 

(2)     Enter into
any contract involving payments to or from the Company in excess of $500,000
other than any such contract that is in accordance with the annual budget
approved under this Section and entered into in the ordinary course of
business.

 

(3)     Materially
change the nature of the business of the Company.

 

(4)     Hire or
remove, with or without cause, executive officers or other members of senior
management of the Company.

 

(5)     Adopt or
make a material amendment to any severance or management equity program.

 

(6)     Enter into
or effect any transaction between the Company, on the one hand, and a member of
senior management (including Cooper, Nystrom, KZC or any Associate Director) or
any, related business partners or family members, or any of their affiliates
(including any entity in which any such member has made a material investment),
on the other hand.

 

(7)     Settle any
claim or litigation for an amount in excess of $500,000.

 

(8)     Hire or
remove, with or without cause, the independent auditors of the Company.

 

(9)     Create or
permit to exist any subsidiary of the Company.

 

(10)   Enter into
any joint venture or similar business alliance.

 

2

 

(11)   Enter into
or effect any transaction or series of related transactions, involving the
sale, lease, exchange or other disposal by the Company of any assets other than
in the ordinary course of business.

 

(12)   Enter into
or effect any transaction or series of related transactions, involving the
purchase, rent, license, exchange or other acquisition by the Company of any
assets other than in the ordinary course of business.

 

(13)   Enter into
or effect any transaction or series of related transactions involving the
merger or consolidation of the Company with or into any Person, or enter into
or effect a change of control transaction.

 

(14)   Dissolve,
liquidate or engage in any recapitalization or reorganization of the Company or
file for bankruptcy by the Company.

 

(15)   Other than
a draw down in the ordinary course of business under a debt agreement entered
into prior to the date of such draw down, the execution of which was previously
approved by the Board, incur any indebtedness (including refinancings), assume,
guarantee, endorse or otherwise as an accommodation become responsible for the
obligations of any other Person, enter into any agreement under which the
Company may incur indebtedness in the future, or make any loan, advance or
capital contribution to any Person, make any voluntary prepayment of
indebtedness of the Company outside the ordinary course of business, or make an
amendment to the maturity date, aggregate principal amount or interest rate of
existing indebtedness.

 

(16)   Enter into
or effect any transaction or series of related transactions in connection with
or involving the sale, exchange, repurchase, redemption, recapitalization,
reclassification or acquisition of securities of the Company.

 

(c)           During
the term of this Agreement, Cooper and Nystrom shall devote approximately 75%
of their working time and efforts to the business and affairs of the Company
and its subsidiaries.  During the term of
this Agreement, Cooper and Nystrom shall use their reasonable efforts to ensure
that at least one of Cooper or Nystrom shall generally be physically present in
Hawaii during normal business hours.

 

(d)           In
undertaking to provide the services set forth herein, Cooper, Nystrom and KZC
do not guarantee or otherwise provide any assurances that they will succeed in
building the Company’s operational and financial health and stability and,
except for the amount referenced in Section 4(b) hereof, the Company’s
obligation to provide the compensation specified under Section 4 hereof
shall not be conditioned upon any particular results being obtained by Cooper,
Nystrom and KZC.

 

(e)           Each
Representative shall be entitled, in performing his or her duties hereunder on
behalf of KZC, to rely on information disclosed or supplied to them without
verification or warranty of accuracy or validity.

 

3

 

(f)            Cooper,
Nystrom and KZC shall keep the Board fully apprised of their findings, plans
and activities through regularly scheduled meetings with the Committee, as
requested by the Committee, which shall be held at a time mutually convenient
to all parties.

 

(g)           Cooper,
as Chief Executive Officer of the Company, acknowledges that he will be the
Principal Executive Executive Officer with the responsibility to sign the
Certifications of the Principal Executive Officer pursuant to Sections 302 and
906 of the Sarbanes-Oxley Act of 2002, as amended, attached as exhibits to the
Company’s periodic reports and filed with the Securities and Exchange
Commission during the term of this Agreement.

 

3.             Term.  The term of KZC’s engagement hereunder shall
commence on the date hereof and shall continue on a month to month basis until
terminated by either party at the end of any such month upon written notice to
the other party given at least ten days prior to the end of such month.  Notwithstanding the foregoing, KZC’s
responsibilities to provide interim management services pursuant to Section 2
hereof shall not commence until (i) this Agreement has been fully
executed, and (ii) the Company has furnished insurance policies, as
detailed in Section 7(c) below, to KZC and KZC has determined that
such policies are acceptable to KZC or if such policies do not exist, cannot be
located or determined, or are not acceptable to KZC, the Company has agreed to
purchase (supplemental) directors, officers and corporate liability insurance,
fiduciary liability insurance and employment practices insurance coverages
acceptable to KZC.  Prior to March 31,
2008, the parties shall endeavor to reach an agreement to provide for the
parties’ desire that Messrs. Cooper and Nystrom continue to provide
management services to the Company for periods after June 30, 2008.

 

4.             Compensation.  Cooper, Nystrom, Associate Directors and KZC’s
compensation hereunder shall consist of the following:

 

(a)           A
monthly fee of $600,000 cash payable to KZC in immediately available funds upon
execution of this Agreement and on the first day of each month thereafter
throughout the term hereof.

 

(b)           In
addition, the Company shall pay KZC a success fee (“Success Fee”) provided that
KZC has performed its duties under this Agreement for the period ending June 30,
2008.  The Success Fee is based upon
improvements in EBITDA (Earnings Before Interest, Taxes, Depreciation and
Amortization) of the Company from the actual results for the 12 month period
ending December 31, 2007.  The
Company and KZC shall agree on a definition of EBITDA within 30 days of the
date hereof.  The Success Fee is
calculated as a sliding scale percentage of the amount of the improvement in EBITDA.

 

	
  Percentage Improvement in

  EBITDA

  	
   

  	
  Success Fee as a Percent of the

  Amount of Increase in

  EBITDA

  	
   

  
	
  First 10%

  	
   

  	
  2

  	
  %

  
	
  Next 15%

  	
   

  	
  4

  	
  %

  
	
  Next 25%

  	
   

  	
  6

  	
  %

  
	
  Next 50%

  	
   

  	
  8

  	
  %

  
	
  Greater than 100%

  	
   

  	
  10

  	
  %

  

 

4

 

The measured EBITDA will be the EBITDA for the 12 month period ending
with the last day of the calendar quarter which follows the calendar quarter in
which the Term ends. The Success Fee will be payable in cash not later than the
end of the month following the end of such 12 month period].

 

(c)           Expenses
– The Company shall reimburse Cooper, Nystrom, Associate Directors and KZC’s
reasonable out-of-pocket expenses.  Such
expenses may include, but are not limited to, costs of travel, reproduction,
typing, computer usage, legal counsel (but excluding time spent negotiating
this Agreement and any time spent with respect to the interpretation or enforcement
of this Agreement) and any applicable state sales or excise tax and other
direct expenses.  Within 30 days from the
date hereof, KZC or Cooper shall provide the Committee with a budget of all
such reimbursable expenses. Certain employees of KZC, individually and/or
jointly through separate entities and through KZC, own and/or charter private
aircraft.  In the event that owned or
chartered aircraft is used, the Company will be charged the applicable first
class or coach fare prevailing on or about the date of travel (which such
amounts shall be included in the “travel” expenses above).

 

The Company shall pay to KZC the compensation set forth in Sections 4(a) and
4(c) hereof based upon the submission of monthly invoices by KZC setting
forth a general description of the services provided and a detailed listing of
the expenses sought to be reimbursed. 
The compensation provided for in this Agreement shall constitute full
payment for the services to be rendered by KZC, Cooper, Nystrom and the
Associate Directors to the Company hereunder.

 

The Company acknowledges and agrees that the hours worked, the results
achieved and the ultimate benefit to the Company of the work performed in
connection with this engagement may be variable and that Company, Cooper,
Nystrom and KZC have taken this into account in setting the fees
hereunder.  No fee payable to any other
person or entity by the Company or any other party shall affect any fee payable
to Cooper, Nystrom and KZC hereunder.

 

5.             Confidentiality.

 

(a)           The
Company, including the Board, shall treat any information received from Cooper,
Nystrom and KZC or a Representative as confidential and, except as specified in
this Section 5(a), will not publish, distribute or otherwise disclose in any
manner any information developed by or received from Cooper, Nystrom and KZC or
a Representative without Cooper, Nystrom and KZC’s or such Representative’s
prior written approval.  Such approval
shall not be required if (i) the information sought is required to be
disclosed by an order binding on Cooper, Nystrom and KZC or a Representative
and issued by a court having competent jurisdiction over Cooper, Nystrom and
KZC and such Representative and such information is disclosed only pursuant to
the terms of such order, (ii) disclosure of such information is otherwise
required by federal or state securities law or regulation, (iii) the
information is otherwise publicly available other than through disclosure by a
party in breach of a confidentiality obligation with respect thereto or (iv) the
information was furnished pursuant to this engagement.

 

5

 

(b)           Cooper,
Nystrom, KZC and each Representative agrees to treat any information received
from the Company or its representatives with utmost confidentiality, and except
as provided in this letter, will not publish, distribute or disclose in any
manner any information developed by or received from the Company or its
representatives without the Company’s prior written approval.  The Company’s approval is not needed if
either (i) the information sought is required to be disclosed by an order
binding on Cooper, Nystrom and KZC, issued by a court having competent
jurisdiction over Cooper, Nystrom and KZC (unless such order specifies that the
information to be disclosed is to be placed under seal) and such information is
disclosed only pursuant to the terms of such order, or (ii) such
information is otherwise publicly available other than through disclosure by a
party in breach of a confidentiality obligation with respect thereto.

 

6.             Representations
and Warranties.

 

As an inducement to Cooper, Nystrom and KZC and to enter into this
Agreement, the Company represents and warrants to Cooper, Nystrom and KZC as
follows:

 

(a)           The
Company is a corporation duly organized and validly existing under the laws of
the jurisdiction in which it was organized and has all requisite corporate
power to enter into this Agreement.

 

(b)           Subject
to the execution by Cooper, Nystrom and KZC of this Agreement, neither the
execution and delivery of this Agreement nor the consummation of the
transactions contemplated herein or therein nor compliance by the Company with
any of the provisions hereof or thereof will: (i) violate any order, writ,
injunction, decree, law, statute, rule or regulation applicable to it or (ii) require
the consent, approval, permission or other authorization of, or qualification
or notice to, any court, arbitrator or other tribunal or any governmental,
administrative, regulatory or self-regulatory agency or any other third-party.

 

(c)           Subject
to execution by Cooper, Nystrom and KZC of this Agreement, this Agreement has
been duly authorized, executed and delivered by the Company and constitutes the
legal, valid and binding agreement of the Company, enforceable in accordance
with its terms.

 

7.             Indemnification.

 

(a)           The
Company shall indemnify and hold harmless Cooper, Nystrom, the Associate
Directors, KZC and its principals, and other KZC employees, representatives or
agents (including counsel) (collectively, the “KZC Indemnitees”) from and
against any and all losses, claims, damages, liabilities, penalties, judgments,
awards, costs, fees, expenses and disbursements, including without limitation,
the reasonable costs, fees, expenses and disbursements, as and when incurred,
from the first dollar, of investigating, preparing or defending any action,
suit, proceeding or investigation (whether or not in connection with
proceedings or litigation in which any KZC Indemnitee is a party)(any such
amount being hereinafter sometimes referred to as an “Indemnifiable Loss”),
directly or indirectly caused by, relating to, based upon, arising out of or in
connection with this engagement of Cooper, Nystrom 

 

6

 

and KZC by
the Company or the performance by Cooper, Nystrom and KZC of any services
rendered pursuant to such engagement, unless there is a final non-appealable
order of a Court of competent jurisdiction, at the trial level, finding KZC
Indemnitees directly liable for gross negligence or willful misconduct.  KZC shall provide the Company with prompt
notice of any claim under this paragraph. 
The Company and KZC shall jointly control any settlement on any action
for which any KZC Indemnitee seeks indemnity; provided, however, that the
Company shall be entitled on its own to effect the settlement of any pending or
threatened proceeding so long as such settlement (i) includes an
unconditional release of KZC, in form and substance reasonably satisfactory to
KZC, from all liability on claims that are the subject matter of such
proceeding and (ii) does not include any statement as to or any admission
of fault, culpability or failure to act by or on behalf of KZC.

 

(b)           If
Cooper, Nystrom, KZC, Representatives or any principal or agent of KZC is
required to testify, prepare for and/or appear at a deposition or produce
documents at any time after the expiration or termination of this Agreement at
any administrative or judicial proceeding relating to any services provided by
Cooper, Nystrom and KZC hereunder, then KZC shall be entitled to be compensated
by the Company for Cooper, Nystrom and KZC’s associated time charges at rates
commensurate with those set forth in Section 4(a)  and to be
reimbursed for reasonable out-of-pocket expenses, including counsel fees.

 

(c)           The
Company has furnished to Cooper, Nystrom and KZC a true, correct and complete
copy of the Directors, Officers and Corporate Liability
Insurance Policy No.                   ,
Employment Practices Insurance, Policy No.                     ,
and Fiduciary Liability Insurance, Policy No.                         
collectively (the “Policies”) issued to the Company by                                                                                 
(the “Insurer”).  The Company represents
that the Policies are in full force and effect and that no event has occurred
that constitutes or, with the passage of time or notice would constitute, an
event of default thereunder or that would otherwise give the Insurer any right
to cancel such Policies.  Promptly and in
any event within two business days of the Company approving this Agreement, the
Company shall notify the Insurer of the election of Cooper as the Chief Executive
Officer and Nystrom as the Chief Operating Officer and of the appointment of
any Associate Directors who become an officer of the Company.  The Company shall cause its insurance broker
to send copies of all documentation and other communications regarding the
Policies, including without limitation any renewal or cancellation thereof, to
the attention of KZC, in the manner set forth herein, and Cooper, Nystrom and
any Associate Directors who become officers of the Company shall have all
indemnities available to the officers of the Company pursuant to the Company’s
Constitutive Documents.  As long as the
same can be done at a commercially reasonable cost, during the term of this
Agreement, the Company shall maintain directors and officers liability
insurance coverage, employment practices insurance coverage and fiduciary
liability insurance coverage comparable as to terms (including without
limitation the provisions or any similar provision regarding extension of the
discovery period thereunder) and amounts as that provided under the Policies during
the term of this Agreement, with any such replacement coverage being obtained
from an insurer with a rating from a nationally recognized rating agency not
lower than that of the Insurer.  Upon any
cancellation or nonrenewal of the Policies by the Insurer, as long as the same
can be done at a commercially reasonable cost, the Company shall exercise its
rights under the applicable clause of the Policies to extend the claim period
for a one-year “discovery period” 

 

7

 

and shall
exercise such rights and pay the premium required thereunder within the 30-day
period specified therein.  The Company
shall use commercially reasonable efforts, in connection with the next renewal
of the Policy, to negotiate to extend the discovery period set forth in the
Policies from one to three years, as long as the same can be obtained at a
commercially reasonable cost.

 

8.             Limitations
on Liability.  The Company agrees
that Cooper, Nystrom, Associate Directors, KZC and its personnel will not be
liable to the Company for any claims, liabilities, or expenses relating to this
engagement in excess of the fees paid by them to KZC pursuant to this
Agreement, unless there is a final non-appealable order of a Court of competent
jurisdiction, at the trial level, finding Cooper, Nystrom, Associate Directors
and KZC directly liable for gross negligence or willful misconduct.  In no event will Cooper, Nystrom, Associate
Directors and KZC, or their personnel be liable for special, punitive or exemplary
loss, damages or expenses relating to this engagement.  These limitations on liability provisions
extend to KZC and its employees, representatives, agents and counsel.  The limitation on liability and
indemnification contained in this agreement shall survive the completion or
termination of this agreement.

 

9.             Independent
Contractor / Benefits; Taxes.  The parties intend that Cooper, Nystrom, KZC
and the Associate Directors shall render services hereunder as independent
contractors, and nothing herein shall be construed to be inconsistent with this
relationship or status.  Cooper, Nystrom,
KZC and the Associate Directors shall not be entitled to any benefits paid by
the Company to its employees.  Cooper,
Nystrom, KZC and the Associate Directors shall be solely responsible for any
tax consequences applicable to Cooper, Nystrom, KZC or the Associate Directors
by reason of this Agreement and the relationship established hereunder, and the
Company shall not be responsible for the payment of any federal, state or local
taxes or contributions imposed under any employment insurance, social security,
income tax or other tax law or regulation with respect to Cooper, Nystrom, KZC
or the Associate Directors’ performance of management services hereunder.  Subject to Section 2(c) of this
Agreement, the parties agree that, subject to the terms and provisions of this
Agreement, Cooper, Nystrom and KZC may perform any duties hereunder and set
Cooper, Nystrom and KZC’s own work schedule without day-to-day supervision by
the Company.  Notwithstanding anything in
this Agreement to the contrary, the Company shall be entitled to effect any
withholding from any amount payable by it pursuant to this Agreement to the
extent required by law.

 

10.          Offer
of Employment.  Subject to the last
sentence of Section 3 with respect to Cooper only, the Company agrees to
promptly notify KZC if it extends (or solicits the possible interest in
receiving) an offer of employment to an employee or principal of KZC and agrees
that it will pay KZC a cash fee, upon hiring, equal to 150% of the aggregate
first year’s annualized compensation, including any guaranteed or target bonus,
to be paid to KZC’s former principal or employee that the Company hires at any
time up to one year subsequent to the date of the final invoice rendered by
Cooper, Nystrom and KZC with respect to this Agreement.

 

11.          Trial.  Each party agrees that neither it nor any of
its assignees or successors shall (a) seek a jury trial in any lawsuit,
proceeding, counterclaim or any other action based upon, or arising out of or
in connection with the engagement of Cooper, Nystrom and KZC by the Company or
any services rendered pursuant to such engagement, or (b) seek to
consolidate any such action with any other action in which a jury trial cannot
be or has not been waived. The

 

8

 

provisions of
this paragraph have been fully discussed by the Company, Cooper, Nystrom and
KZC and these provisions shall be subject to no exceptions.  Neither party has agreed with or represented
to the other that the provisions of this section will not be fully enforced in
all instances.

 

12.          Jurisdiction.  Each party hereby irrevocably and
unconditionally (a) submits for itself and its property in any legal action
or proceeding relating to the engagement of Cooper, Nystrom and KZC by the
Company or any services rendered pursuant to such engagement, to the non-exclusive
general jurisdiction of the State of New York, the Courts of United States of
America for the Southern District of New York, and appellate courts from any
thereof; (b) consents that any such action or proceeding may be brought in
such courts and waives any objection that it may now or hereafter have to the
venue of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or
claim the same; (c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or certified
mail (or any substantially similar form of mail), postage prepaid, to the
respective party at its  address set
forth below or at such other address of which the other parties shall have been
notified pursuant thereto; (d) agrees that nothing herein shall affect the
right to effect service of process in any other manner permitted by law or
shall limit the right to sue in any other jurisdiction; and (e) waives, to
the maximum extent not prohibited by law, any right it may have to claim or
recover in any legal action or proceeding referred to in this subsection any
special, exemplary or punitive damages.

 

13.          Survival
of Agreement.  Except as provided in
this Agreement, the obligations set forth under the above captioned
Confidentiality, Indemnification, Limitation on Liability, Compensation, Offer
of Employment, Trial, and Jurisdiction sections shall survive the expiration,
termination, or supersession of this agreement.

 

14.          Conflicts.  Cooper, Nystrom and KZC confirm that no
employee of KZC has any financial interest or business connection with the
Company.  However, in the case of public
companies, KZC employees may own publicly traded shares and bonds.  Additionally, KZC has run a conflict check
through Kroll Inc.’s database, which is an internal computer database
containing names of individuals-and entities that are- present or recent former
clients of Kroll, Inc. and its’ subsidiaries, including KZC.  Marsh & McLennan Companies Inc. (“MMC”),
KZC’s indirect parent, and its non-Kroll subsidiaries and affiliates do not
maintain a-conflict checking system, and KZC does not presently check for
conflicts against MMC and its non-Kroll subsidiaries and affiliates.  Based upon the information presently
available, KZC is aware of no conflicts in connection with this
engagement.  It is understood and agreed
that KZC may accept the representation of other persons whose general business
interest may compete with the Company’s interest or be adverse to the Company’s
interest, so long as there is no actual or direct conflict of interest.

 

15.          Amendments.  Any amendment to this Agreement shall be made
in writing and signed by the parties hereto.

 

9

 

16.          Enforceability.  If any provision of this Agreement shall be
invalid or unenforceable, in whole or in part, then such provision shall be
deemed to be modified or restricted to the extent and in the manner necessary
to render the same valid and enforceable, or shall be deemed excised from this
Agreement, as the case may require, and this Agreement shall be construed and
enforced to the maximum extent permitted by law as if such provision had been
originally incorporated herein as so modified or restricted or as if such
provision had not been originally incorporated herein, as the case may be.

 

17.          Construction.  This Agreement shall be construed and
interpreted in accordance with the internal laws of the State of New York.

 

18.          Notices.  All notices, requests, consents and other
communications hereunder to any party shall be deemed to be sufficient if
contained in a written instrument delivered in person or duly sent by certified
mail, postage prepaid; by an overnight delivery service, charges prepaid; or by
confirmed telecopy; addressed to such party at the address set forth below or
such other address as may hereafter be designated in writing by the addressee
to the addressor:

 

If to the Company:

 

Hawaiian
Telcom Communications, Inc.

c/o The Carlyle Group

520
Madison Avenue

New
York, NY 10022

Attention:
James A.  Attwood, Jr.

 

If to KZC:

 

Kroll
Zolfo Cooper LLC

101
Eisenhower Parkway, 3rd Floor

Roseland,
NJ 07068

Attention:
Elizabeth S. Kardos

 

If to Cooper:

 

Kroll
Zolfo Cooper LLC

101
Eisenhower Parkway, 3rd Floor

Roseland,
NJ 07068

Attention: Elizabeth S.  Kardos

 

If to Nystrom:

 

Kroll
Zolfo Cooper LLC

101
Eisenhower Parkway, 3rd Floor

Roseland,
NJ 07068

Attention:
Elizabeth S.  Kardos

 

10

 

Any party may from time to time change its address for the purpose of
notices to that party by a similar notice specifying a new address, but no such
change shall be deemed to have been given until it is actually received by the
party sought to be charged with its contents.

 

19.          Waivers.  No claim or right arising out of a breach or
default under this Agreement shall be discharged in whole or in part by a
waiver of that claim or right unless the waiver is supported by consideration
and is in writing and executed by the aggrieved party hereto or his or its duly
authorized agent.  A waiver by any party
hereto of a breach or default by the other party hereto of any provision of
this Agreement shall not be deemed a waiver of future compliance therewith, and
such provisions shall remain in full force and effect.

 

20.          Counterparts.  This Agreement may be executed in several
counterparts, each of which shall be deemed an original, and all of which shall
together constitute one and the same instrument.

 

21.          Disclosure.  KZC shall not have the right to disclose its
retention by the Company or the successful completion of its services hereunder
without the prior written consent of the Company.

 

22.          Entire
Agreement.  This Agreement and the
other documents delivered pursuant hereto, if any, constitute the full and
entire understanding and agreement among the parties hereto with regard to the
subjects hereof and thereof and no party shall be liable or bound to any other
in any manner by any representations, warranties, covenants and agreements
except as specifically set forth herein and therein.

 

11

 

IN WITNESS WHEREOF, this Agreement has been executed by the parties as
of the date first above written.

 

	
   

  	
  HAWAIIAN TELCOM COMMUNICATIONS,

  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ James A. Attwood, Jr.

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  KROLL ZOLFO COOPER LLC

  

 

 

	
   

  	
  By:

  	
  /s/ Elizabeth Kardos

  
	
   

  	
  Title:  General Counsel

  
	
   

  	
   

  
	
   

  	
  STEPHEN F. 
  COOPER

  

 

 

	
   

  	
  By:

  	
  /s/ Stephen F. Cooper

  
	
   

  	
  Title:  Chairman

  
	
   

  	
   

  
	
   

  	
  KEVIN NYSTROM

  

 

 

	
   

  	
  By:

  	
  /s/ Kevin Nystrom

  
	
   

  	
  Title: Senior Director

  

 

12

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