Exhibit 10.1
March 5, 2007
Mr. Robert F. Reich
3622 Honey Hill Drive SE
Cedar Rapids, Iowa 52403
Dear Robert:
This letter confirms our discussions
regarding your employment with Hawaiian Telcom, Inc., a Hawaii
corporation (the “ Company” ). The purpose
of this letter is to summarize the terms of your employment.
Notwithstanding anything herein to the contrary, you will be an
employee at-will of the Company. The Company may terminate
your employment at any time with or without cause, at its
discretion. Likewise, you may terminate your employment with
the Company at any time for any reason. We ask that, as
a courtesy, however, you give the Company 30 days advance
notice, prior to a voluntary employment separation.
Additionally, your employment may be terminated if the Company is
not satisfied with the results of a background check, or if
information that you provided in connection with your application
is determined by the Company to be false, inaccurate, or
misleading.
1.
Start Date
: April 16, 2007 (“ Start
Date ”).
2.
Position : Vice President and Controller
3.
Direct Report
: You shall report to the
Chief Financial Officer.
4.
Base Salary
: $195,000 per year (the
“ Base Salary ”), payable in accordance with the
Company’s customary payroll practices. Paydays are
expected to be every other Friday (total of 26 pay days a
year). Your paycheck shall be delivered to you or made
available to you on such dates. If a payday falls on a
holiday or weekend, you may pick up your paycheck on the weekday
immediately preceding the payday.
5.
Sign-on Bonus
: In addition to your Base
Salary, you will receive a sign-on bonus of $40,000, payable in two
(2) installments. The first installment, $25,000, will be
paid in the first payroll cycle after your start date according to
usual payroll processes and practices; the second installment,
$15,000 will be paid in the first payroll cycle after the six-month
anniversary of your Start Date according to usual payroll processes
and practices. Both installments are subject to normal
taxes. If, however, your employment is terminated for Cause,
as defined herein, or you voluntarily leave prior to the one year
anniversary of your Start Date, the Company’s obligations
under this paragraph shall cease and you shall be obligated to
reimburse the Company for the entire sign-on bonus paid to
you. Your signed acknowledgement and acceptance of this offer
letter authorizes the Company to make a payroll deduction for
reimbursement of said bonus in the event that you become obligated
to reimburse the Company pursuant to this Paragraph 5.
6.
Annual Performance
Bonus: Annual
maximum bonus of 50% of Base Salary. The availability and
amount of such bonus, if any, shall be governed by the terms of the
Company’s bonus plan, provided, however, the bonus for the
2007 plan year will not be prorated to reflect your April 16, 2007
Start Date .
7.
Stock Option
: You will be eligible to
receive a grant of a nonqualified stock option to purchase a number
of shares of the common stock of the Company’s parent,
Hawaiian Telcom Holdco, Inc., pursuant to the Company’s stock
option plan. The number of shares subject to the option grant
shall be determined based on financial models prepared by or under
the direction of the Company or its affiliates which, among other
things, assume a certain rate of return on an investment in
Hawaiian Telcom Holdco, Inc. under various possible future
scenarios. You shall receive options covering that number of
shares as would produce a pre-tax target option value of $750,000
at such specified future date as is determined by the Company if as
of that date an investment in the Company achieved a specified rate
of return as determined by the Company.
8.
Employee Benefits
: You shall be eligible
to participate in Company employee benefit plans and programs
commensurate with your position and seniority. You shall be
entitled to three weeks paid vacation each calendar year.
Vacation scheduling should be coordinated with your direct
supervisor to avoid undue impacts on the Company and productivity.
Unused vacation may carry over to subsequent years up to a maximum
of four weeks. Please note that the Company reserves the
right to change its benefits package at its sole
discretion.
9.
Relocation Expenses
: In accordance with the
Company’s applicable relocation plans and policies, the
Company shall reimburse you for reasonable relocation and travel
expenses incurred in connection with your move to Hawaii.
Such expenses include costs of packing, unpacking and
transporting
