Exhibit 10.24
EXECUTIVE EMPLOYMENT AGREEMENT
This
EMPLOYMENT AGREEMENT (“Agreement”) dated March 24,
2005 and effective as of March 29, 2005 (“Effective
Date”) is entered into by and between David Z. Arakawa
(“Employee”) and Hawaiian Airlines, Inc., a Hawaii
corporation (“Company”).
Company and
Employee desire to establish Company’s right to services of
Employee, in the capacity described below, on the terms and
conditions and subject to the rights of termination hereinafter set
forth, and Employee agrees to engage in such employment on those
terms and conditions.
In
consideration of the mutual agreements hereinafter set forth,
Employee and Company have agreed and do hereby agree as
follows:
1.
EMPLOYMENT AS SENIOR VICE PRESIDENT, GENERAL COUNSEL AND
CORPORATE SECRETARY (“GC”) . Company does
hereby employ and engage Employee as Senior Vice President - GC,
and Employee does hereby accept and agree to such engagement and
employment.
a.
Basic Duties . Employee’s duties during the
Employment Period shall be to serve as Senior Vice President
– GC, which shall generally include those contained in
Attachment A. The precise scope of the duties of Employee may
be modified from time to time at the discretion of Company’s
President or his designee(s) consistent with Employee’s
titles and general duties and responsibilities hereunder.
b.
Reporting Relationship . Employee shall at all times
report to the President or his designee(s).
c.
Time and Effort Expected of Employee . Employee shall
devote full time, attention, energy and skill to the performance of
Employee’s duties for Company and for the benefit of
Company. Furthermore, Employee shall
exercise due
diligence and care in the performance of Employee’s duties to
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 two (2) years, unless terminated
earlier as provided in Section 7 of this Agreement. The
term of this Agreement may be extended upon mutual agreement in
writing signed by Employee and an authorized representative of
Company. 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 Employee’s employment
(“Termination Date”) under this or any successor
agreement shall be referred to as the “Employment
Period.”
3.
COMPENSATION .
a.
BASE SALARY . Company shall pay Employee, and Employee
agrees to accept from Company, a base salary at the rate of TWO
HUNDRED THOUSAND DOLLARS AND NO /100 THS DOLLARS
($200,000) per year (“Base Salary”), less applicable
withholdings required by law or Employee’s benefit plans or
other deductions authorized in writing by Employee to be withheld
or deducted, payable in equal semi-monthly installments in
accordance with Company’s regular payroll practices.
Employee’s Base Salary shall be reviewed annually by Company
and may be increased, but not decreased, by Company in its sole and
absolute discretion. Any adjusted amounts under this
Section 3.a. will thereafter become the “Base
Salary” for purposes of this Agreement.
c.
PERFORMANCE BONUS . In addition to the Base Salary,
Employee shall be eligible to participate during the Employment
Period in any performance bonus plan hereafter established for
senior officers of Company by the Board of Directors (the
“BOD”). Any award to Employee under that plan
shall be payable, less applicable withholdings, in the amount, in
the manner, and at the time determined by the BOD, in its sole and
absolute discretion. Company will request that the BOD award a
target bonus equal to 50% of
2
Employee’s Base Salary, with actual
payment amount established annually as a function of overall
corporate performance and Employee’s performance relative to
previously established management objectives.
d.
STOCK OPTIONS . In addition to Base Salary, Employee
shall be eligible to participate during the Employment Period in
any stock option plan hereafter established for the senior officers
of Company by the BOD in accordance with plan terms and applicable
law. Any award to Employee under such plan shall be made in
an amount, in the manner, and at the time determined by the BOD, in
its sole and absolute discretion. Company will request an
incoming grant of 53,000 stock options for Employee that would vest
in two equal tranches, one tranche each year, during the Employment
Period. Additionally, Employee will be considered for
additional stock option grants if and when such grants are awarded
for other senior executives at Company.
e.
LONG TERM INCENTIVE PLANS . In addition to Base
Salary, Employee shall be eligible to participate during the
Employment Period in any long term incentive plans hereafter
established for the senior officers of Company by the BOD in
accordance with plan terms and applicable law. Any award to
Employee under such plan shall be made in an amount, in the manner,
and at the time determined by the BOD, in its sole and absolute
discretion.
f.
401(k) PLAN . Employee shall be eligible to
participate in a 401(k) or analogous plan (the “401(k)
Plan”) according to its terms, which shall be developed by
Company, subject to approval of the BOD, and which shall not occur
before Company’s emergence from Chapter 11 bankruptcy.
4.
FRINGE BENEFITS . During his employment under this
Agreement, Employee shall be eligible to participate in, and to be
covered by, such employee benefit plans effective generally with
respect to Company’s senior officers as those plans may be
amended, supplemented, replaced or terminated from time to time, to
the extent Employee is eligible under the terms of such
3
plans; and
Employee shall be eligible to receive such other fringe benefits as
may be granted to Employee from time to time by the BOD or as
delegated by it in its sole and absolute discretion. In
addition to the foregoing benefits, Employee shall also receive the
following individual benefits:
a.
TRAVEL BENEFITS . During the Employment Period,
Employee and Employee’s spouse and eligible dependents shall
be entitled to travel benefits on Company flights (but not charter
flights) at a level and under procedures commensurate with the
senior officer level, subject to IRS requirements, and pursuant to
Company policy. Employee and Employee’s spouse and
eligible dependents of Employee shall be entitled to travel
benefits on other airlines consistent with Company’s
interline transportation agreements.
b.
EXECUTIVE LONG-TERM DISABILITY INSURANCE PLAN .
Subject to the applicable waiting periods, Employee will be
included, at Company’s expense, in Company’s Executive
Long-Term Disability Insurance Plan, as it may be amended,
supplemented, replaced or terminated from time to time.
c.
BUSINESS EXPENSES . Company shall reimburse Employee
for any and all reasonable out-of-pocket, necessary, customary, and
usual expenses, properly receipted in accordance with Company
policies, incurred by Employee on behalf of Company, provided
Employee properly accounts to Company for such expenses in
accordance with the rules and regulations of the Internal
Revenue Service under the Code, and in accordance with the standard
policies and procedures of Company to reimburse business expenses,
which obligation shall survive the termination of this
Agreement.
d.
VACATIONS . Company will provide reasonable vacations
authorized by the President subject to requirements of operations
and as duties may permit, provided that unused vacation will not be
accrued and Company will not make payment to Employee for
unutilized vacation.
e.
SICK LEAVE . Reasonable sick leave for illness or
injury will also be
4
provided,
provided that unused sick leave will not be accrued and Company
will not make payment to Employee for unutilized sick
leave.
5.
CONFIDENTIAL INFORMATION . Employee recognizes that by
reason of Employee’s employment by and service to 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 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 Company’s valuable and unique asset and agrees
that Employee shall not, during or after the Term of this
Agreement, use or disclose directly or indirectly any of
Company’s Confidential Information to any person, except that
Employee may use and disclose to Company’s authorized
personnel such Confidential Information as is reasonably
appropriate in the course of the performance of Employee’s
duties hereunder. Company’s Confidential Information
shall include all information and knowledge of any nature and in
any form relating to 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 Company’s
business; and advertising, promotions, financial matters, sales and
profit figures, and customers or customer lists.
6.
TERMINATION OF EMPLOYEE’S EMPLOYMENT .
a.
DEATH . If Employee dies while employed by Company,
Employee’s employment shall immediately terminate.
Company’s obligation to pay Employee’s Base Salary
shall cease as of the date of Employee’s death. Thereafter,
Employee’s beneficiaries or estate shall receive benefits, if
any, in accordance with Company’s retirement, insurance, and
other applicable benefit plans then in effect.
b.
DISABILITY . If Employee (i) becomes Disabled, as
defined in Company’s Executive Long-Term Disability Plan,
(ii) he cannot be reasonably
5
accommodated
by Company, and (iii) he commences to receive long-term
disability benefits, Employee’s employment may be terminated
by Company or Employee. During any period prior to such
termination during which Employee is absent from the full-time
performance of Employee’s duties with Company due to
Disability, Company shall continue to pay Employee the Base Salary
at the rate in effect at the commencement of such period of
Disability. Any such payments made to Employee shall be
reduced by amounts received from disability insurance obtained or
provided by Company, and by the amounts of any benefits payable to
Employee, with respect to such period, under Company’s
Executive Long-Term Disability Plan. Subsequent to the
termination provided for in this Section 6.b.,
Employee’s eligibility for any benefits shall be determined
under Company’s retirement, insurance, and other applicable
benefit plans then in effect in accordance with the terms of such
plans.
c.
TERMINATION BY COMPANY FOR CAUSE . Company may
terminate 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 Employee, including
without limitation, repeated neglect of Employee’s duties,
Employee’s repeated material lack of diligence and attention
in performing services as provided in this Agreement, or
Employee’s repeated failure to implement or adhere to Company
policies.
(ii)
Conduct of a criminal nature that may have an adverse impact on
Company’s reputation and standing in the community.
(iii)
Fraudulent conduct in connection with the business affairs of
Company, regardless of whether said conduct is designed to defraud
Company or others.
(iv)
Conduct at any time or place which is detrimental to
6
Hawaiian Airlines’ reputation and/or
goodwill among its customers and/or the community as determined by
the company.
(v)
Conduct in violation of the Company’s and/or its parent
company’s corporate compliance rules, practices, procedures
and ethical guidelines.
(vi)
Material violation(s) of Company’s House Rules, a copy of which has
been provided to Employee by Company.
In the event
of termination for Cause, Company’s obligation to pay
Employee’s Base Salary and
| 
