EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") dated February ___, 1998 and
effective as of March 1, 1998 ("Effective Date") is entered into by and between
Xxxxxxx Xxxxxxxx (the "Employee") and Hawaiian Airlines, Inc., a Hawaii
corporation (the "Company").
The Company desires to establish its right to continued services of the
Employee, in the capacity described below, on the terms and conditions and
subject to the rights of termination hereinafter set forth, and the Employee is
willing to accept such employment on such terms and conditions.
In consideration of the mutual agreements hereinafter set forth, the
Employee and the Company have agreed and do hereby agree as follows:
1. EMPLOYMENT AS SENIOR VICE PRESIDENT-HUMAN RESOURCES. The Company does
hereby employ, engage, and hire the Employee as Senior Vice President-Human
Resources and the Employee does hereby accept and agree to such hiring,
engagement, and employment. The Employee's duties during the Employment Period
(defined below) shall be the executive, managerial and reporting duties as are
appropriate for a Senior Vice President-Human Resources and such other duties as
the Board of Directors of the Company, the Chief Executive Officer of the
Company or any Executive Vice President of the Company shall from time to time
prescribe and as provided in the Bylaws of the Company. The Employee shall
devote full time, energy and skill to the performance of Employee's duties for
the Company and for the benefit of the Company, reasonable vacations authorized
by the Company's Board of Directors and reasonable absences because of illness
excepted. Furthermore, the Employee shall exercise due diligence and care in
the performance of Employee's duties to the Company under this Agreement.
2. TERM OF AGREEMENT. The term of this Agreement ("Term") shall commence
on the Effective Date and shall continue for a period of twelve (12) months;
provided, however, that on the first day of each calendar month commencing one
month following the Effective Date, the Term shall be extended one additional
month unless either party shall have given written notice to the other party
that it does not wish to extend the Term. The period of time commencing on the
Effective Date and ending on the expiration date of the Term, or, if earlier,
the date of termination of the Employee's employment ("Termination Date") under
this or any successor agreement shall be referred to as the "Employment Period".
3. COMPENSATION.
(a) BASE SALARY. The Company shall pay the Employee, and the Employee
agrees to accept from the Company, in full payment of Employee's
services to the Company, a base salary at the rate of ONE HUNDRED
FIFTY THOUSAND AND NO/100THS DOLLARS ($150,000.00) per year ("Base
Salary"), payable in equal bimonthly installments or at such other
time or times as the Employee and the Company shall agree. The
Employee's Base Salary shall be reviewed at least annually by the
Company and may be increased as determined by the Company's
Compensation Committee and/or the Board of Directors, in their sole
and absolute discretion.
Employment Agreement - Xxxxxxx Xxxxxxxx
Page 2
(b) SIGNING BONUS. In addition to the foregoing and in consideration
of Employee entering into this Agreement, Employee shall receive an
initial bonus of Ten Thousand U.S. Dollars ($10,000.00), payable on
the first day of Employee's employment by the Company.
(c) PERFORMANCE BONUS - BOARD OF DIRECTORS DISCRETION. The Employee
shall be eligible to receive an annual performance bonus. Any such
bonus awarded to the Employee shall be payable in the amount, in
the manner, and at the time determined by the Company's
Compensation Committee and/or the Board of Directors, in their sole
and absolute discretion.
4. FRINGE BENEFITS. The Employee shall be entitled to participate in any
benefit programs adopted from time to time by the Company for the benefit of its
executive employees, and the Employee shall be entitled to receive such other
fringe benefits as may be granted to Employee from time to time by the Company's
Compensation Committee and/or the Board of Directors.
(a) BENEFIT PLANS. The Employee shall be entitled to participate in
any benefit plans relating to stock options, stock purchases, pension, thrift,
profit sharing, life and disability insurance, medical coverage, executive
medical and dental coverage, education, or other retirement or employee benefits
available to all other executive employees of the Company, subject to any
restrictions specified in such plans.
(b) TRAVEL BENEFITS. Employee and Employee's spouse shall be
entitled to travel benefits on Company flights (but not charter flights) at the
PS2F/PS2Y category. Employee's eligible dependents shall be entitled to travel
benefits on Company flights (but not charter flights) at the SA2F/SA1Y category.
Employee and Employee's eligible dependents shall be entitled to travel benefits
on other airlines at the sole discretion of such airlines, at a comparable level
to that provided to other Company executive officers.
(c) EXECUTIVE LONG-TERM DISABILITY INSURANCE PLAN. Subject to the
applicable waiting periods, the Employee will be included in the Company's
Executive Long-Term Disability Insurance Plan, as it may be modified from time
to time, at the Company's expense.
(d) BUSINESS EXPENSES. The Company shall reimburse the Employee for
any and all necessary, customary, and usual expenses, properly receipted in
accordance with Company policies, incurred by the Employee on behalf of the
Company, including reimbursement for use of the Employee's personal vehicle for
business purposes.
(e) CLUB DUES. The Company shall pay all dues and similar charges
(other than initiation fees) for two clubs in Hawaii.
(f) AUTOMOBILE. The Company shall provide Employee with a automobile
allowance of $800.00 per month, which amount shall be added to Employee's W-2
compensation at year-end.
Employment Agreement - Xxxxxxx Xxxxxxxx
Page 3
5. CONFIDENTIAL INFORMATION. Employee recognizes that by reason of
Employee's employment by and service to the Company, Employee will occupy a
position of trust with respect to business and technical information of a secret
or confidential nature which is the property of the Company which will be
imparted to Employee from time to time in the course of the performance of
Employee's duties hereunder (the "Confidential Information"). Employee
acknowledges that such information is a valuable and unique asset of the Company
and agrees that Employee shall not, during or after the Term of this Agreement,
use or disclose directly or indirectly any Confidential Information of the
Company to any person, except that Employee may use and disclose to authorized
personnel of the Company such Confidential Information as is reasonably
appropriate in the course of the performance of Employee's duties hereunder.
Confidential Information of the Company shall include all information and
knowledge of any nature and in any form relating to the Company including but
not limited to, business plans; development projects; computer software and
related documentation and materials; designs, practices, processes, methods,
know-how and other facts relating to the business of the Company; advertising,
promotions, financial matters, sales and profit figures, customers or customer
lists. Confidential Information shall not include any information that is or
shall become publicly known through no fault of the Employee and any information
received in good faith from a third party who has the right to disclose such
information and who has not received such information, either directly or
indirectly, from the Company.
6. TERMINATION OF EMPLOYEE'S EMPLOYMENT.
(a) DEATH. If the Employee dies while employed by the Company,
Employee's employment shall immediately terminate. The Company's obligation to
pay the Employee's Base Salary shall cease as of the date of the Employee's
death. Thereafter, the Employee's beneficiaries or estate shall receive
benefits in accordance with the Company's retirement, insurance, and other
applicable programs and plans then in effect.
(b) DISABILITY. If, as a result of the Employee's mental or physical
incapacity, the Employee shall be unable to perform the services for the Company
contemplated by this Agreement in the manner in which Employee previously
performed them during an aggregate one hundred twenty (120) business days in any
consecutive seven (7) month period ("Disability"), the Employee's employment may
be terminated by the Company for Disability. During any period prior to such
termination during which the Employee is absent from the full-time performance
of Employee's duties with the Company due to Disability, the Company shall
continue to pay the Employee the Base Salary at the rate in effect at the
commencement of such period of Disability. Any such payments made to the
Employee shall be reduced by amounts received from disability insurance obtained
or provided by the Company, and by the amounts of any benefits payable to the
Employee, with respect to such period, under the Company's Executive Long-Term
Disability Plan. Subsequent to the termination provided for in this Section
7(b), the Employee's benefits shall be determined under the Company's retirement
insurance, and other compensation programs then in effect in accordance with the
terms of such programs.
(c) TERMINATION BY THE COMPANY FOR CAUSE. The Company may terminate
the Employee's employment under this Agreement for "Cause" at any time prior to
expiration of the Term of the Agreement, only upon the occurrence of any one or
more of the following events:
(i) The material breach of this Agreement by the Employee,
including without limitation, repeated willful neglect of the Employee's
duties, the Employee's material lack of diligence and attention in
performing services as provided in this Agreement, or the Employee's
repeated willful failure to implement or adhere to policies established by,
or directives of, the Company's Board of Directors.
Employment Agreement - Xxxxxxx Xxxxxxxx
Page 4
(ii) Conduct of a criminal nature that may have an adverse impact
on the Company's reputation and standing in the community; or
(iii) Fraudulent conduct in connection with the business
affairs of the Company, regardless of whether said conduct is designed to
defraud the Company or others.
In the event of termination for Cause, the Company's obligation to pay
the Employee's Base Salary shall cease as of the Termination Date. If the
Employee's employment is terminated for Cause, the Employee's employment may be
terminated immediately without any advance written notice.
(d) TERMINATION BY THE COMPANY WITHOUT CAUSE. The Company shall have
the right to terminate this Agreement prior to the expiration of the Term, at
any time, without "Cause". In the event the Company shall so elect to terminate
this Agreement, the Employee shall receive compensation pursuant to the
provisions of Section 7 hereof.
7. COMPENSATION UPON TERMINATION OR NON-RENEWAL BY THE COMPANY OTHER THAN
FOR CAUSE. If the Employee's employment shall be terminated (i) by act of the
Company other than for Cause, or (ii) upon expiration of the Term and the
Company fails to offer to renew the Employee's employment pursuant to this
Agreement on the same terms and conditions, except by reason of "Cause", the
Employee shall be entitled to the following benefits:
(a) PAYMENT OF UNPAID BASE SALARY. The Company will immediately pay
the Employee any portion of the Employee's Base Salary not paid prior to the
Termination Date.
(b) CONTINUED PAYMENT OF BASE SALARY. For the twelve (12) month
period subsequent to the Termination Date, the Company shall pay to the
Employee, on a bimonthly basis an amount equal to all Base Salary that would
have been payable to the Employee pursuant to this Agreement had the Employee
continued to be employed for the twelve (12) months immediately following the
Termination Date (such Base Salary for such period being equal to the Employee's
Base Salary in effect as of the Termination Date).
(c) CONTINUATION OF FRINGE BENEFITS. The Company shall continue to
provide the Employee with all Fringe Benefits set forth in Section 4 throughout
the remaining twelve (12) month period subsequent to the Termination Date, as if
the Employee's employment under the Agreement had not been terminated. If, as
the result of terminating of Employee's employment, Employee and/or Employee's
otherwise eligible dependents or beneficiaries shall become ineligible for
benefits under any one or more of the Company's benefit plans, the Company shall
continue to provide the Employee and Employee's eligible dependents or
beneficiaries with benefits at a level at least equivalent to the level of
benefits for which the Employee and Employee's dependents and beneficiaries were
eligible under such plans immediately prior to the Termination Date.
8. NONCOMPETITION PROVISIONS.
(a) RIGHT TO COMPANY MATERIALS. The Employee agrees that all styles,
designs, lists, materials, books, files, reports correspondence, records, and
other documents ("Company Materials") used, prepared, or made available to the
Employee, shall be and shall remain the property of the Company. Upon the
termination of employment or the expiration of this Agreement, all Company
Materials shall be returned immediately to the Company, and the Employee shall
not make or retain any copies thereof.
Employment Agreement - Xxxxxxx Xxxxxxxx
Page 5
(b) ANTI-SOLICITATION. The Employee promises and agrees that during
the term of this Agreement Employee will not influence or attempt to influence
customers or suppliers of the Company or any of its present or future
subsidiaries or affiliates, either directly or indirectly, to divert their
business to any individual, partnership, firm, corporation or other entity then
in competition with the business of the Company or any subsidiary or affiliate
of the Company.
(c) SOLICITING EMPLOYEES. During the term of this Agreement and for
the twelve (12) month period commencing on the Termination Date, the Employee
promises and agrees that Employee will not directly or indirectly solicit any of
the Company's employees to work for any business, individual, partnership, firm,
corporation, or other entity then in competition with the business of the
Company or any subsidiary or affiliate of the Company.
9. NOTICES. All notices, requests, demands and other communications
hereunder shall be in writing and shall be effective upon receipt. All notices
shall be given or served personally or sent by facsimile or first class mail,
postage prepaid, addressed as follows:
If to the Company: Hawaiian Airlines, Inc.
Attn: General Counsel
0000 Xxxxxxx Xxxxxx, Xxxxx X-000
Xxxxxxxx, Xxxxxx 00000
Phone: 808/000-0000
Fax: 808/000-0000
If to the Employee: Xxxxxxx Xxxxxxxx
0000-X Xxxxx Xxxxx
Xxxxxxxx, Xxxxxx 00000
or to such other address which the party receiving the notice has notified the
party giving the notice in the manner aforesaid.
10. ATTORNEYS' FEES. In the event judicial or quasi-judicial
determination is necessary of any dispute arising as to the parties' rights and
obligations hereunder, the Company and the Employee shall bear their respective
attorneys' fees and costs associated with such dispute.
11. TERMINATION OF PRIOR AGREEMENTS. This Agreement terminates and
supersedes any and all prior agreements and understandings between the parties
with respect to employment or with respect to the compensation of the Employee
by the Company from and after the Effective Date.
12. ASSIGNMENT; SUCCESSORS. This Agreement is personal in its nature and
neither of the parties hereto shall, without the consent of the other, assign or
transfer this Agreement or any rights or obligations hereunder; provided that,
in the event of the merger, consolidation, transfer, or sale of all or
substantially all of the assets of the Company with or to any other individual
or entity, this Agreement shall, subject to the provisions hereof, be binding
upon, and inure to the benefit of such successor and such successor shall
discharge and perform all the promises, covenants, duties, and obligations of
the Company hereunder.
13. GOVERNING LAW. This Agreement and the legal relations thus created
between the parties hereto shall be governed by and construed under and in
accordance with the laws of the State of Hawaii.
14. ENTIRE AGREEMENT; HEADINGS. This Agreement embodies the entire
agreement of the parties respecting the matters within its scope and may be
modified only in
Employment Agreement - Xxxxxxx Xxxxxxxx
Page 6
writing. This Agreement constitutes the employment contract referred to in
that letter dated March 10, 1997 between the Company and Employee, a copy of
which is attached hereto as Exhibit A, and is intended to be consistent
therewith. Section headings in this Agreement are included herein for
convenience of reference only and shall not constitute a part of this
Agreement for any other purpose.
15. WAIVER: MODIFICATION. Failure to insist upon strict compliance with
any of the terms, covenants, or conditions hereof shall not be deemed a waiver
of such term, covenant, or condition, nor shall any waiver or relinquishment of,
or failure to insist upon strict compliance with, any right or power hereunder
at any one or more times be deemed a waiver or relinquishment of such right or
power at any other time or times. This Agreement shall not be modified in any
respect except by a writing executed by each party hereto.
16. SEVERABILITY. In the event that a court of competent jurisdiction
determines that any portion of this Agreement is in violation of any statute or
public policy, only the portions of this Agreement that violate such statute or
public policy shall be stricken. All portions of this Agreement that do not
violate any statute or public policy shall continue in full force and effect.
Further, any court order striking any portion of this Agreement shall modify the
stricken terms as narrowly as possible to give as much effect as possible to the
intentions of the parties under this Agreement.
17. INDEMNIFICATION. The Company shall indemnify and hold the Employee
harmless to the maximum extent permitted by the appropriate provisions of the
statutes of the State of Hawaii and the Restated Articles of Incorporation of
the Company, as such may be amended.
18. COUNTERPARTS. This Agreement may be executed in several counterparts,
each of which shall be deemed to be an original but all of which together will
constitute one and the same instrument.
IN WITNESS WHEREOF, the Company has caused this Agreement to executed
by its duly authorized officers, and the Employee has hereunto signed this
Agreement, as of the date first above written.
HAWAIIAN AIRLINES, INC.
BY: __________________________________
Xxxx X. Xxxxx
Its President and Chief Executive Officer
BY: __________________________________
Xxxx X. Xxxxxxxxx
Its Executive Vice President and
Chief Financial Officer
EMPLOYEE
_____________________________________
Xxxxxxx Xxxxxxxx
