Exhibit 10.5
SEPARATION AGREEMENT
AND COMPLETE SETTLEMENT AND RELEASE OF ALL CLAIMS
I.
PARTIES TO THE AGREEMENT
This Separation Agreement and Complete Settlement and Release of All
Claims ("Agreement") is made between XXXXX X. XXXXXX ("Executive") and
HAWAIIAN AIRLINES, INC. ("Hawaiian"). Executive and Hawaiian are
collectively referred to as the "Parties."
II.
BACKGROUND AND RECITAL
A. By mutual agreement, Executive's active employment with Hawaiian
will end as of the close of business on March 31, 1997.
B. The Parties wish to resolve all potential claims Executive may have
arising out of or related to Executive's employment by Hawaiian.
III.
CLAIMS
For the purpose of this Agreement, the term "Claims" shall be defined as
any and all claims, counterclaims, cross-claims, third-party complaints,
demands, causes of action, obligations, controversies, liabilities and
damages of any kind, name, nature or description, whether based on contract,
tort, fraud, misrepresentation, statute or any other theory which the Parties
had, have or may have against each other and/or related persons and/or past
and present officers and directors and/or entities either at law, or in
equity, whether now known, or unknown, and whether suspected or unsuspected,
and which have been, or could have been, alleged by the Parties in a lawsuit
or administrative or other legal proceeding or forum of any nature or which
are based upon, arose from, related to, or are connected in any way
whatsoever with: (i) the hiring, employment, or cessation of employment of
Executive; or (ii) any and all claims arising from any alleged violations by
Hawaiian and/or past or present officers and directors and/or related persons
and/or entities of any federal, state or local statutes, ordinances or common
laws, including, but not limited to, Title VII of the Civil Rights Act of
1964, the Employee Retirement Income Security Act, and all federal and state
laws and regulations regarding employment matters.
As used in this Agreement the term "Claims" expressly does not include
any of the obligations under this Agreement. The duties, covenants and
warranties of the Parties under this Agreement shall expressly survive the
execution of this Agreement.
IV.
CONSIDERATION
In consideration of the mutual covenants contained in this Agreement,
the Parties hereby agree as follows:
A. SETTLEMENT SUM. If and only if Executive does not breach any term
or condition in this Agreement, Hawaiian shall provide Executive with the
following:
1. Pay Executive the sum of Three Hundred Thirty-One Thousand
Dollars ($331,000.00) in equal semi-monthly payments beginning on April 1,
1997 and continuing through March 31, 1998.
2. Provide Executive with full medical, dental and insurance
benefits as provided to senior executives of Hawaiian through March 31, 1998.
3. a. Extend the last exercise date of Executive's existing
stock options granted under Hawaiian's 1994 Stock Option Plan (including
those transferred to Executive's former wife pursuant to their Property
Settlement Agreement) until June 30, 1999.
b. During the term of Executive's options, extend to
Executive and his former spouse the benefits of any amendments, other than
maturity changes, awarded to the other option holders.
4. Provide Executive travel benefits on Hawaiian as a senior
executive through March 31, 1999.
5. Provide Executive with travel benefits on other airlines as a
continuing employee of Hawaiian through the expiration dates of the current
year's pass cards, with the exception of American Airlines. The intention is
that Executive shall be entitled to Executive's current boarding priority
category.
6. Provide free shipment of Executive's personal effects from
Hawaii to Dallas, Texas, including pick up and delivery.
7. Provide Executive with COMAT cargo benefits on Hawaiian as if
he were employed by Hawaiian through March 31, 1998.
8. Provide Executive with a container freight employee discount
between Hawaii and the U.S. mainland as if he were employed by Hawaiian
through March 31, 1998.
9. Provide Executive with the use of his leased vehicle through
March 31, 1997.
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10. For the nine-month period from April 1, 1997, it will be
assumed that employee status for income tax on personal travel will apply.
After that, taxable travel will be valued at no higher than FTP rates unless
changes in federal tax law, regulations or practice dictate otherwise.
11. Hawaiian will continue to assist Executive in making required
personal SEC filings relating to Hawaiian securities.
The consideration stated in this paragraph IV.A. in its entirety is
hereinafter referred to as the "Settlement Sum." If Executive breaches in a
material way any term of this Agreement, he shall immediately forfeit all
rights under this Agreement to any portion of the Settlement Sum that remains
to be paid or provided as of the date of the breach. In the event of such
breach, the Executive's duties under this Agreement will remain, and
Executive acknowledges that his receipt of any portion of the Settlement Sum
shall be good and adequate consideration for all of the duties he has
undertaken in this Agreement.
Prior to the time that Executive's medical and dental benefits cease or
are terminated, Hawaiian shall provide Executive with information regarding
his right to receive COBRA benefits.
B. ACCRUAL OF BENEFITS. Executive agrees and understands that his
active employment with Hawaiian will cease as of March 31, 1997 and that
final separation from Hawaiian's payroll will occur on March 31, 1998. Both
Parties agree that the Settlement Sum provided by paragraph IV.A. is
consideration for this Agreement and is not a wage or employment benefit.
C. COMPANY PROPERTY. Executive shall immediately return to Hawaiian
all company issued items, including but not limited to office keys, computer
equipment, disks and/or electronic data. Immediately after Hawaiian's
payment obligations pursuant to paragraph IV.A. above cease or are
terminated, Executive shall immediately return to Hawaiian his A.O.A. badge
and Friendship Program vouchers. On or before March 31, 1998, Executive
shall return to Hawaiian his employee identification badge and annual pass
card.
D. MUTUAL RELEASE. The Parties, and their respective and related
entities, for themselves and each of their heirs, and their executors,
administrators, or personal representatives, hereby fully and finally waive,
release and discharge each other and their respective and related entities,
and their stockholders, partners, related partnerships and partners,
subsidiaries, parent corporations, affiliate corporations, corporations under
common control, past and present employees, past and present officers, past
and present directors, agents, representatives, brokers, attorneys, insurers,
excess insurers, reinsurers, indemnitors, subcontractors, consultants,
suppliers, and successors and/or assigns from any and all Claims.
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E. ABSOLUTE BAR. This Agreement is an absolute bar to all Claims
released hereunder. The Parties agree that they will not at any time file
any suit or make any claim or demand against each other or related persons or
entities concerning the Claims released hereunder. The Parties also
specifically warrant that they have no other claims and will bring no other
claim against each other and/or related persons and/or entities.
F. NO PENDING CHARGES OR COMPLAINTS. The Parties warrant that neither
they nor any other person or entity have filed or reported any complaint,
charge, or claim of any nature with any court, agency, or other governmental
office or entity against each other regarding the Claims. The Parties agree
that they will not file or report or permit the filing or reporting of any
complaint, charge, or claim of any nature with any court, agency, or other
governmental office or entity regarding the Claims.
V.
FURTHER AGREEMENTS, COVENANTS AND REPRESENTATIONS
A. CONSULTING. Hawaiian may at its initiative call upon Executive for
services during the nine month period from April 1, 1997 at per diem rates to
be agreed plus expenses for car and lodging, separate from the Settlement
Sum. Executive shall be issued an IRS Form 1099 at year-end for all such
income derived as a result of these services.
B. RIGHT OF REVOCATION. Executive has a period of seven (7) full days
following the execution of this Agreement by all Parties hereto to revoke
this Agreement by providing written notice of such revocation to Hawaiian.
This Agreement shall not become effective or enforceable until this seven (7)
day revocation period has expired without Executive having exercised his
right of revocation.
C. FURTHER ACKNOWLEDGMENTS. Executive fully understands, acknowledges
and agrees that among the various rights and claims he is waiving, releasing
and forever discharging by the execution of this Agreement are all rights and
claims arising under the Federal Age Discrimination in Employment Act of
1967, 29 U.S.C. section 621 et seq. Executive further understands,
acknowledges and agrees that he:
1. Has been given at least twenty-one (21) full days within which
to consider this Agreement before executing it;
2. Has carefully read and fully understands all of the provisions
of this Agreement;
3. Is, by the execution of this Agreement, waiving, releasing and
forever discharging Hawaiian from all claims for relief, causes of action and
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liabilities of any nature whatsoever, known or unknown, that he has or may
have against Hawaiian, individually and/or collectively, including but not
limited to claims of age discrimination;
4. Knowingly and voluntarily agrees to all of the terms of this
Agreement;
5. Knowingly and voluntarily intends to be legally bound by all
of the terms of this Agreement;
6. Was previously advised, and is hereby further advised, in
writing to consult with an attorney of his choice before executing this
Agreement;
7. Has a period of seven (7) full days following the execution of
this Agreement by all Parties hereto to revoke this Agreement by providing
written notice of such revocation to Hawaiian and was previously advised, and
is hereby further advised, in writing that this Agreement shall not become
effective or enforceable until this seven (7) day revocation period has
expired without Executive having exercised his right of revocation; and
8. Understands that rights or claims under the Federal Age
Discrimination in Employment Act of 1967, 29 U.S.C. section 621 et seq., that
may arise after the date when this Agreement is executed by all Parties
hereto are not waived.
D. ACCEPTANCE OF AGREEMENT. If Executive does not revoke this
Agreement within the seven (7) day revocation period described in paragraph
IV.B. above, Executive agrees to mail or hand deliver to Xxx X. Xxxxx the
original of a letter he has executed, in the form attached hereto as Exhibit
"A," confirming Executive has not exercised his right to revoke. Within
seven (7) days after Hawaiian receives the original of said letter as
executed by Executive, Hawaiian agrees to commence the settlement
consideration described in paragraph IV.A. above.
E. INDEMNITY AND ENFORCEMENT OF THIS AGREEMENT. Each Party agrees that
if he or it shall breach this Agreement, said Party shall fully indemnify and
hold harmless the other Party from the consequences of such breach. The
liability of any Party in any action or other proceeding for breach of this
Agreement shall include not only the monetary amount of any judgment which
may be awarded but also all of the damages, costs and reasonable attorneys'
fees and costs incurred by the non-breaching party.
F. ALL CLAIMS. As a further inducement for this Agreement, the Parties
expressly waive the provisions of any and all ordinances, statutes, and
common law principles and doctrines providing that a general release may not
extend to claims which they did not know or suspect to exist in their favor
at the time of executing
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the release, which if known by them might have materially affected their
settlement with each other and/or related persons and/or entities.
The Parties acknowledge that they understand that this Agreement shall
extend and apply to all unknown, unsuspected and unanticipated Claims, and/or
losses, and/or damages, which are related to the Claims, as well as those
which are specifically referred to herein, and the Parties hereby affirm that
they have affixed their signatures hereto voluntarily and of their own free
will and accord.
G. FACTS. The Parties understand and expressly accept and assume the
risk that the facts with respect to which this Agreement is executed may be
found hereafter to be other than or different from the facts now believed by
them to be true, and agree that this Agreement shall remain effective
notwithstanding any such differences in fact.
H. SERIOUSNESS OF CLAIMS. The Parties further understand that there
is a risk that their damages or Claims may be or may become more serious than
they now expect or anticipate. The Parties expressly accept and assume this
risk, and agree that this Agreement shall be and remain effective
notwithstanding any such misunderstanding as to the seriousness of their
damages or Claims.
I. OWNERSHIP OF CLAIMS. The Parties represent and warrant to each
other that no person other than themselves had, or has, an interest in the
Claims and that they have not sold, assigned, transferred, conveyed or
otherwise disposed of any of the Claims.
J. HEADINGS. The headings included in this Agreement are for
convenience only and do not in any way limit, alter or affect the matters
contained in this Agreement or the paragraphs that they encaption.
K. ALTERATION OF THIS AGREEMENT. This Agreement shall not be altered,
amended, modified or otherwise changed in any respect or particular
whatsoever, except in writing duly executed by all the Parties. Each Party
acknowledges and agrees that he or it will make no claim, at any time or
place, that this Agreement has been verbally altered or modified in any
respect whatsoever.
L. ATTORNEYS' FEES. The Parties will each bear their own attorneys'
fees and costs to date relative to this Agreement, [except that Hawaiian shall
pay for Executive's attorneys' fees relating to the review and execution of this
Agreement].
M. AUTHORITY. The Parties warrant to each other that each of them has
full power, authority and capacity to execute this Agreement. Executive
acknowledges that he has been informed of his right to consult with an
attorney prior to entering into this Agreement.
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N. CONFIDENTIALITY. As a condition of this Agreement, Executive
agrees not to reveal any information concerning the Claims, the terms and
conditions of this Agreement, or the negotiations leading to this Agreement
or the amount or range of amount of the Settlement Sum and/or any other
aspect of settlement made by or on behalf of the Parties to any third person,
except his immediate family members, his attorney (if any), as necessary for
tax purposes, or as otherwise required by law. Anyone to whom the terms are
disclosed as allowed by this Agreement shall be advised of this
confidentiality requirement.
As a further condition of this Agreement, Executive warrants that
he has not disclosed the amount of the Settlement Sum, except as permitted
above, and that he will not and has not, in any manner, publicized the
existence of the Settlement Sum. Executive further warrants that he has not
and will not disclose any confidential or proprietary information of Hawaiian
which he obtained during his employment with Hawaiian except as permitted in
writing signed by an authorized representative of Hawaiian.
O. SUPPORT OF THE COMPANY. Executive acknowledges and understands
that the Settlement Sum pursuant to this Agreement is contingent upon his
support of Hawaiian both in the public domain and within the Company.
Executive agrees that in the aforementioned twelve (12) month period, he will
recommend and promote Hawaiian and not disparage it or its past or present
directors, officers, employees or agents in any way or manner.
P. DISPUTES. Any dispute which arises under this Agreement shall be
resolved solely by binding arbitration under the rules of the American
Arbitration Association with arbitration to take place in Honolulu, Hawaii.
Q. COMPLETE AGREEMENT. This Agreement contains the entire agreement
between the Parties with respect to the subject matter hereof.
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DATED: Honolulu, Hawaii. February __ 1997.
HAWAIIAN AIRLINES, INC.
By _______________________________
Xxxx X. Xxxxx
Chairman
By _______________________________
Xxx X. Xxxxx
Vice President, General
Counsel and Corporate Secretary
"HAWAIIAN"
_______________________________
XXXXX X. XXXXXX
"EXECUTIVE"
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