Exhibit 10.15
EXECUTION COPY
April 8, 2005
James A. Attwood, Jr.
William Kennard
Hawaiian Telcom HoldCo,
Inc.
Hawaiian Telcom Communications,
Inc.
c/o The Carlyle Group
520 Madison Avenue, 41
st
Floor
New York, NY 10022
R. Ronald Hopkinson
Latham & Watkins
LLP
885 Third Avenue
Suite 1000
New York, NY 10022
Subject: Amendment No. 2 of Transition Services
Agreement
Dear Sirs,
Reference is made to the Transition Services
Agreement by and among Verizon Information Technologies LLC
(successor to Verizon Information Technologies Inc.), Hawaiian
Telcom HoldCo, Inc. (f/k/a Paradise HoldCo, Inc.), Hawaiian Telcom
Communications, Inc. (f/k/a Paradise MergerSub, Inc.) and Verizon
Hawaii Inc. dated May 21, 2004, as amended on August 27,
2004 (herein the “Transition Services Agreement”).
Capitalized terms used herein have the meanings assigned in the
Transition Services Agreement or the Merger Agreement, as
applicable, unless otherwise defined herein.
A. The parties hereby agree to revise and
replace in its entirety Schedules A and B attached hereto and
incorporated herein and add a new set of Transition Services
identified in Schedules C and D attached hereto and incorporated
herein. The provisions of Sections 2.1(a), 2.3, 2.5, 2.7, 3.1,
3.2(d), 7.1 and 22.13 are amended, modified and restated in their
entirety as follows:
2.1 (a) Following the Closing,
and subject to the terms and conditions hereof, Supplier shall
arrange for, procure, aggregate and otherwise cause its Affiliates
and their employees and agents to provide to the Surviving
Corporation and its Affiliates for use in the Business during the
term hereof, the Services listed on Schedules A, C and D
(collectively, the “ Transition Services ” and
each service, a “ Transition Service ”).
Schedules A, C and D include, for each Transition Service, (
i ) a description of the service (or group of related
services) to be performed, ( ii ) significant
performance requirements of Supplier or its Affiliates and the
Surviving Corporation and other special terms and conditions
relating directly to the services to be performed, and ( iii
) the base service fee
or methodology to calculate the base
service fee to be paid to Supplier, including monthly fixed
payments (a “ Fixed Monthly Service Fee ”) or
per unit fees or costs (a “ Unit Based Service Fee
”) as applicable.
2.3. Special Services Fees .
Buyer, the Surviving Corporation or its representatives may request
that Supplier or its Affiliates (1) participate in meetings,
telephone calls, training or other consultations which may be
(a) necessary for Supplier and its Affiliates or the Surviving
Corporation to perform their requirements as described in Schedules
A, C and D, (b) desirable to the Surviving Corporation in
order to perform its requirements described in Schedule A, C and D
or (c) desirable to the Surviving Corporation in connection
with the usage of the Verizon Proprietary Software or
(2) prepare a Linked Services Report as contemplated in
Section 4.1 (all such services in clauses (1) and (2),
the “ Special Services ”). Supplier and its
Affiliates shall provide reasonable services as requested in
accordance with the following terms:
(i) from May 21, 2004 until 30
calendar days following the Closing, at no charge, unless and until
the total time spent by Supplier and its Affiliates for such
Special Services exceeds 1,500 documented hours (the “
Special Services Threshold ”), in which case Buyer or
the Surviving Corporation, as the case may be, shall pay Seller for
all such time relating to the provision of such Special Services in
excess of the Special Services Threshold at the rate of $85 per
hour; and
(ii) from 30 calendar days following
the Closing until the end of the term of this Agreement, at the
rate of $85 per hour; provided that if the total time spent
by Supplier and its Affiliates for Special Services pursuant to
clause (i) above does not exceed the Special Services
Threshold, then from 30 calendar days following the Closing until
the end of the term of this Agreement the time spent by Supplier
and its Affiliates rendering Special Services in connection with
the Verizon Proprietary Software shall be at no charge, unless and
until the total time spent by Supplier and its Affiliates in
connection with the Verizon Proprietary Software exceeds the
remaining hours available under the Special Services Threshold, and
then Surviving Corporation shall pay Seller for all such time at
the rate of $85 per hour (such fees for Special Services under
clauses (i) and (ii) of this Section 2.3, and any
amount payable pursuant to the immediately following paragraph, the
“ Special Services Fees ”)
In addition to any amounts payable
pursuant to clause (i) and (ii), Buyer or the Surviving
Corporation, as the case may be, shall reimburse the Seller for all
reasonable pre-approved out-of-pocket travel related costs in
connection with providing any Special Services hereunder. For the
avoidance of doubt, ( x ) the time spent by the
Supplier in preparing a Linked Services Report, if requested, shall
be included in the calculation of time spent by the Supplier for
Special Services; provided that, notwithstanding anything to
the contrary, no more than 750 hours of the time spent in preparing
the Linked Services Report shall count towards the Special Services
Threshold, and any time spent in preparing the Linked Services
Report that is in excess of 750 hours shall be free of charge to
Buyer or Surviving Corporation and ( y ) the time spent
by the Cutover Planning
2
Committee in preparing the Cutover
Plan shall not be included in the calculation of time spent by the
Supplier for Special Services.
2.5. Service Fee . Supplier
shall administer this Agreement with respect to the delivery of
Transition Services. As more fully described in Article XI and
subject to specific arrangements set forth in Schedules A, C and D,
Supplier will coordinate all communications, questions and problem
resolution with respect to all Transition Services. The Surviving
Corporation shall pay Supplier for Unit Based Service Fees, Special
Service Fees, Fixed Monthly Service Fees and Third Party Vendor
Costs for each Transition Service as hereinafter described in
Article VI (collectively, the “ Service Fee ”).
Without limiting the obligation of the Surviving Corporation under
Article VI, Supplier shall be responsible to pay its Affiliates for
any Transition Services or Special Services provided and third
party vendors for Third Party Vendor Costs. The Service Fee is
exclusive of any Taxes.
2.7. Performance by Surviving
Corporation . Subject to Section 14.2, the Surviving
Corporation agrees to perform in a timely fashion those tasks, and
to provide the personnel, facilities and accurate information, as
are expressly set forth in Schedules A, C and D. In addition, the
Surviving Corporation agrees to use commercially reasonable efforts
to cooperate with Supplier and its Affiliates, and to perform in a
timely fashion, those additional commercially reasonable tasks
directly related to the Transition Services which Supplier may
request. For purposes of clarity, the obligation of Surviving
Corporation to use commercially reasonable efforts as described in
the preceding sentence shall be satisfied if Surviving Corporation
performs such tasks in a manner similar to how such tasks are
performed by Parent’s West region telephone operations
Affiliates (including those in California, Texas and the Pacific
Northwest) which are receiving services similar to the Transition
Services from Supplier’s Affiliates.
3.1. General Scope .
Transition Services include only services and functions as were
provided to Verizon Hawaii and/or its Affiliates, as applicable, on
the date immediately prior to the Closing Date, unless the service
descriptions on Schedule A, C or D specifically indicate otherwise.
Unless specifically set forth on Schedule A, C or D, or are
specifically allowed or agreed pursuant to the provisions hereof;
neither Supplier nor its Affiliates will provide any additional,
modified, general or customized services.
3.2 (d) If a Conforming Change
occurs or a Change Request is approved in accordance with this
Article III, the definition of Transition Services and Schedule A,
C or D as applicable will be deemed amended to reflect the
implementation of the Conforming Change or Change Request as well
as any other terms and conditions agreed upon by the parties in
writing.
7.1. General . Supplier and
its Affiliates shall devote such time, effort and resources to the
performance of Transition Services, as they deem necessary in the
exercise of their reasonable discretion to provide the Transition
Services specified in Schedules A, C and D. Supplier and its
Affiliates will perform the Transition Services ( i
) in compliance with applicable Law and ( ii
) with the same overall standards of quality, efficiency and
timeliness as such services are then being provided by
Supplier’s Affiliates
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either to Parent’s West
region
