(c)                                  Embedded Accenture Technical Elements.

(i)                                     Except with respect to specific projects agreed in advance in writing by the Hawaiian Telcom and Accenture Account Representatives (or other duly authorized representatives), all development work performed by or on behalf of Accenture under this Agreement will be original, including the development of Deliverables and the making of any changes to Hawaiian Telcom Technical Elements.  Without limiting the generality of the foregoing, Accenture shall not incorporate into any Deliverable or any Hawaiian Telcom Technical Element any software, documentation, or other materials that it has not created, or had created on its behalf, under this Agreement, except with respect to specific projects or work agreed in advance in writing by the Parties.

(ii)                                  Accenture may embed Accenture Technical Elements into a Deliverable or a Hawaiian Telcom Technical Element only if (A) such Accenture Technical Elements are identified in a separate section of the SOW or Work Order clearly and conspicuously identified as “Accenture Technical Elements Embedded in Deliverables or Hawaiian Telcom Technical Elements,” (B) such section clearly identifies, for each Deliverable or Hawaiian Telcom Technical Element in which Accenture intends to embed an Accenture Technical Element, what Accenture Technical Elements will be embedded and which are Accenture Owned Technical Elements versus Accenture Third Party Technical Elements, and (C) for any Accenture Third Party Technical Elements, such section clearly identifies any limitations on the rights provided to Hawaiian Telcom in this Section 6.5 which are applicable to each such Accenture Third Party Technical Element.  Subject only to any deviations which are identified in accordance with Section 6.5(c)(ii)(C), Accenture hereby grants Hawaiian Telcom a royalty-free, nonexclusive, perpetual, revocable, transferable license to use, copy, distribute, modify and create derivative works and otherwise use in any manner solely for Hawaiian Telcom’s internal business purposes any such Accenture Technical Elements embedded in a Deliverable or Hawaiian Telcom Technical Element solely as used in such Deliverable or Hawaiian Telcom Technical Element and not as a “stand-alone” product or separately from the Deliverable or Hawaiian Telcom Technical Element in which it is embedded.  Hawaiian Telcom may sublicense the rights in the preceding sentence to a third party service provider, solely on behalf of Hawaiian Telcom for Hawaiian Telcom’s internal business purposes; provided that such service provider is bound by a legally binding agreement including the foregoing license restrictions and confidentiality provisions consistent with those set forth in this Agreement.  The rights granted under this Section are also subject to Hawaiian Telcom and its sublicensees complying with the restrictions and nondisclosure obligations that are applicable to Accenture Third Party Technical Elements which are specifically identified as required by Section 6.5(c)(ii)(C) above.  Accenture shall be responsible for obtaining Required Consents with respect to such Accenture Third Party Technical Elements.  Subject to the restrictions identified pursuant to Section 6.5(c)(ii)(C), the license to Accenture Technical Elements embedded in a Deliverable or Hawaiian Telcom Technical Element shall become fully paid up and irrevocable when Accenture has received (except for issuance of a Service Level Credit or Balanced Scorecard Credit, if applicable) payment of all Charges associated with such Deliverable or Hawaiian Telcom Technical Element (or such Service rendered with respect to the AM Services).  For the avoidance of doubt, references herein to “internal business purposes” include the right of Hawaiian Telcom to use the applicable Technical Element to service its customers as a telecommunications service provider, and not for timesharing or service bureau or other rental or sharing arrangements.

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(d)                                 Accenture-Provided User Tools.  Accenture may use Accenture-Provided User Tools in connection with providing the Services, provided that such tools are solely used in connection with Accenture providing and Hawaiian Telcom receiving the Services, and are not necessary for the operation of the System or the functionality of any aspects of the System.  Accenture-Provided User Tools are defined in Exhibit F (Resources).  Accenture hereby grants Hawaiian Telcom a royalty-free, limited, nonexclusive, revocable license to use the Accenture-Provided User Tools, during the term of the applicable Statement of Work (and any applicable Termination Assistance Period), solely as necessary for Hawaiian Telcom to receive the Services.  All Accenture-Provided User Tools in Hawaiian Telcom’s possession shall be promptly returned to Accenture upon completion of the Services under the applicable Statement of Work (or earlier expiration or termination thereof).

(e)                                  Ownership of Accenture Technical Elements.  As between Accenture and Hawaiian Telcom, Accenture shall be the sole and exclusive owner of any Accenture Technical Elements.

6.6                               Consents.  Each Party will be responsible for obtaining any Required Consents which it is obligated to procure as provided for herein or which it otherwise needs to comply with its obligations hereunder.

6.7                               Asset Obligations.  Unless other responsibilities are set forth in the Exhibit identifying the applicable asset, the Parties’ respective administrative, operational, maintenance and financial responsibilities with respect to assets are summarized in this Section 6.7.  For purposes of this Article VI, and except as otherwise provided in this Article VI, a Party having administrative, operational, maintenance or financial responsibility for any particular asset shall mean the following:

(a)                                  A Party who has administrative responsibility for an asset means that such Party shall be responsible for managing such asset, including the tracking of renewal dates and license compliance provisions;

(b)                                 A Party who has financial responsibility for an asset means that such Party shall be responsible for all financial obligations with respect to such asset, including acquisition costs, maintenance costs, refresh and upgrade and, with respect to leased assets, any financial obligations set forth in such lease; and

(c)                                  A Party who has operational responsibility for an asset means that such Party shall be responsible for operational support of the asset, which, in the case of the In-Scope Applications, will include the obligations set forth in Exhibit B-3 (AM Services) and B-4 (Cross Functional Services);

(d)                                 A Party who has maintenance responsibility for an asset means that such Party shall be responsible for establishing and maintaining appropriate third party maintenance arrangements for the maintenance of the asset, including such maintenance arrangements that a well-managed company, acting in a prudent manner would maintain.  At a minimum, with respect to assets existing as of the Effective Date, such maintenance arrangements shall be no less favorable than such arrangements exist as of the Effective Date.

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6.8                               Risk of Loss.  Subject to Section 14.1, Accenture shall bear the risk of loss for any loss, damage or casualty to all Accenture Resources, including any Accenture Resources installed or located at Hawaiian Telcom premises that are in the care, custody or control of Accenture (except that Hawaiian Telcom shall be responsible for loss, damage or casualty to Accenture Resources to the extent such loss, damage or casualty is due to the negligent acts or omissions of Hawaiian Telcom Personnel or any Hawaiian Telcom invitees).  Accenture shall bear the risk of loss for, and insure against, any loss, damage or casualty to any Hawaiian Telcom-Provided Equipment that is located at Accenture Facilities or that are otherwise in the care, custody or control of Accenture.  Hawaiian Telcom shall continue to bear the risk of loss for, and insure against, any loss, damage or casualty to any Hawaiian Telcom Resources that remain at Hawaiian Telcom premises and in the possession, care, custody or control of Hawaiian Telcom (except that Accenture shall be responsible for loss, damage or casualty to such Hawaiian Telcom Resources to the extent such loss, damage or casualty is due to the negligent acts or omissions of Accenture Personnel or any Accenture Personnel invitees).

ARTICLE VII
SERVICE LOCATIONS

7.1                               Service Locations.  Initially, Accenture will perform Services identified in one or more Statements of Work or Work Orders, in a material respect, from the Service Locations.  Accenture may,  without Hawaiian Telcom’s consent (subject to the remainder of this paragraph), relocate the performance of such Services from one Accenture Service Location to another location that is of the same or higher quality within the same metropolitan area, provided that, except for a change in such Service Location requested by Hawaiian Telcom, Accenture shall be responsible for any incremental costs reasonably incurred by Hawaiian Telcom in order to receive the Services from the new location (including any costs necessary for Hawaiian Telcom to secure any Required Consents, which Hawaiian Telcom will use Reasonable Efforts to minimize).  Accenture shall not perform such Services, in a material respect, except from a metropolitan area in which a Service Location is located, unless Accenture obtains prior written consent from Hawaiian Telcom to perform such Services elsewhere, which consent may not be unreasonably withheld, conditioned or delayed.  Notwithstanding the foregoing, Accenture will provide Hawaiian Telcom with notice of any move, and where the move is within the same metropolitan area, Accenture will not move any Actual Services where the consent of Verizon or of any other third party provider of any material Hawaiian Telcom Technical Elements does not approve of such move, provided that Hawaiian Telcom agrees to use Reasonable Efforts to obtain such approval.  The Parties agree that the public perception or reputational ramifications of a migration (which shall be in Hawaiian Telcom’s reasonable judgment) shall constitute a reasonable basis for Hawaiian Telcom to withhold such consent.  The applicable Statement of Work identifies the Key Accenture Personnel who are to be based in Hawaii (“Key On-Site Personnel”).  During the term of the Agreement and subject to Section 9.8(j), Accenture shall not re-locate Key On-Site Personnel to another location, without Hawaiian Telcom’s prior written consent.

7.2                               Relocation of Service Locations.  Except as provided in Section 7.3, if either Party requests a change in the Service Locations, such change will be addressed pursuant to the Contract Change Control Process.

7.3                               Relocation Resulting from Changes in Laws and Regulations.  The Parties acknowledge and agree that a portion of the Services are being provided from offshore Service Locations (i.e., outside the United States) to leverage the use of lower cost offshore resources, and that the Charges are based on the use of such lower cost resources.  In the event any Laws or regulations are promulgated, changed,

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amended or otherwise come into effect at any time during the Term that impose restrictions or limitations on, or prohibit, the offshore portion of the Services, in whole or part, Hawaiian Telcom shall either pay for the added expenses of performing the work offshore or pay the transition expenses associated with relocating to an onshore U.S. Accenture service delivery location and increased Charges resulting from providing the Services from such location.  Notwithstanding anything to the contrary herein, Hawaiian Telcom shall be responsible for, and shall reimburse Accenture for the payment of, any new or increased taxes imposed by the State of Hawaii or any governmental sub-division thereof (e.g., county or municipality in Hawaii).

ARTICLE VIII
RELATIONSHIP GOVERNANCE

8.1                               Accenture Account Representative.  During the Term, Accenture shall designate a senior level individual who shall be primarily dedicated to Hawaiian Telcom’s account who (i) shall be the primary contact for Hawaiian Telcom in dealing with Accenture under this Agreement, (ii) shall have overall responsibility for managing and coordinating the delivery of the Services, (iii) shall meet regularly with the Hawaiian Telcom Account Representative, and (iv) shall have the authority to make decisions with respect to actions to be taken by Accenture in the ordinary course of day-to-day management of Accenture’s account in accordance with this Agreement (the “Accenture Account Representative”).

8.2                               Hawaiian Telcom Account Representative.  During the Term, Hawaiian Telcom shall designate a senior level individual who (i) shall be the primary contact for Accenture in dealing with Hawaiian Telcom under this Agreement, (ii) shall have overall responsibility for managing and coordinating the receipt of the Services, (iii) shall meet regularly with the Accenture Account Representative, and (iv) shall have the authority to make decisions with respect to actions to be taken by Hawaiian Telcom in the ordinary course of day-to-day management of this Agreement (the “Hawaiian Telcom Account Representative”).

8.3                               Establishment of Service Management Steering Committee.  Accenture and Hawaiian Telcom shall appoint a Service Management Steering Committee (the “Service Management Steering Committee”), made up of a number of key executives from each Party (inclusive of the Accenture Account Representative and the Hawaiian Telcom Account Representative), which shall meet, from time to time, and at such time as its members or the Parties deem appropriate, to (i) review and analyze the monthly performance reports for the preceding period and the Parties’ overall performance under this Agreement, (ii) review progress on the resolution of issues, (iii) provide a strategic outlook for Hawaiian Telcom’s requirements, and (iv) attempt to resolve, or designate individuals to attempt to resolve, any disputes or disagreements under this Agreement.  Although the Hawaiian Telcom Account Representative and the Accenture Account Representative shall remain as members of the Service Management Steering Committee, either Party may change its other representatives from time to time upon written notice to the other; provided that such replacement shall be of the same or a higher level of responsibility within Hawaiian Telcom or Accenture, as applicable.  In addition, the Parties may mutually agree to increase or decrease the size, purpose or composition of the Service Management Steering Committee in an effort for Accenture to better provide, and for Hawaiian Telcom to better utilize, the Services.  The members of the Service Management Steering Committee shall not have separate voting rights; all actions of the Service Management Steering Committee required under this Agreement shall require the mutual consent of the Parties.  As of the Effective Date, the Parties agree that the Service Management Steering Committee shall meet at least once a month, shall include the following persons: from Hawaiian Telcom, Michael Ruley, Matt Boyer and David Torline, and from Accenture, Andy Zimmerman, Dan Lauderback and Tim Hale.

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8.4                               Accenture Personnel.

(a)                                  Designation of Key Personnel.  Hawaiian Telcom may designate up to fifteen percent (15%) of those Accenture Personnel dedicated for the entire term of the Recovery Services or Enhancement Services to the performance of the Recovery Services or Enhancement Services from time to time and up to fifteen percent (15%) of the dedicated Accenture Personnel performing Non-Discretionary AM Services from time to time as key supplier personnel (“Key Accenture Personnel”), inclusive of those Key Accenture Personnel identified in Exhibit B-4 (Cross-Functional Statement of Work).  The Accenture Personnel approved as of the Effective Date to fill the Key Accenture Personnel positions are listed in Exhibit B-4 (Cross Functional Statement of Work).  Subject to the foregoing, Hawaiian Telcom may from time to time change Accenture positions that are designated as Key Accenture Personnel positions by giving written notice to Accenture thirty (30) days in advance of the effective date of the change.

(b)                                 Removal of Key Personnel. Accenture shall cause each of the Key Accenture Personnel to be dedicated to performing the Services on essentially a full-time basis, subject to Section 9.8(j).  Without Hawaiian Telcom’s prior written consent (which it may withhold in its sole discretion), Accenture shall not withdraw or re-assign any Key Accenture Personnel from his or her Key Accenture Personnel position (i) during the duration of the Recovery Services or Enhancement Services, with respect to Recovery Services or Enhancement Services, respectively, or (ii) prior to the (a) the end of the AM Services Term or (b) the first twelve (12) months after such individual began serving in such role on a permanent basis, whichever is earlier, with respect to the AM Services.

(c)                                  Exceptions.  The obligations in Section 8.4(b) shall not apply where any Key Accenture Personnel staff member:  (i) voluntarily resigns from Accenture; (ii) is dismissed by Accenture for misconduct (including fraud, drug abuse, theft, or failure to comply with Accenture personnel policies (including the business conduct guidelines)); (iii) fails to perform his or her assigned duties and responsibilities (including refusal to undergo background investigations and examinations by Accenture in accordance with Accenture policies, as described in Exhibit J); (iv) dies or is unable to work due to disability; or (v) is placed on an approved leave of absence in accordance with applicable Laws.

(d)                                 Assignment of Key Accenture Personnel.  Before placing a person in a Key Accenture Personnel position, Accenture shall:  (i) notify Hawaiian Telcom of the proposed assignment; (ii) introduce the individual to appropriate Hawaiian Telcom representatives; (iii) provide such representatives upon request with the opportunity to interview the individual; and (iv) provide Hawaiian Telcom with a résumé and other information about the individual reasonably requested by Hawaiian Telcom to the extent that the disclosure of such other information is consistent with Accenture’s employment policies, reasonably applied.  If Hawaiian Telcom objects to the proposed assignment, the Parties shall attempt to resolve Hawaiian Telcom’s concerns on a mutually agreeable basis.  Unless and until Hawaiian Telcom’s concerns are satisfied, the individual shall not be assigned to the Key Accenture Personnel position.  If the Parties have not been able to resolve Hawaiian Telcom’s concerns within five (5) Business Days, Accenture shall propose to Hawaiian Telcom the assignment of another individual of suitable ability and qualifications.  Subject to Section 8.5, Hawaiian Telcom hereby approves the Key Accenture Personnel identified in the applicable Statement of Work as of the Effective Date.

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(e)                                  Replacement of Key Accenture Personnel.  Subject to Section 8.4(c), Key Accenture Personnel may not be transferred or re-assigned by Accenture until a suitable replacement has been approved by Hawaiian Telcom in accordance with Section 8.4(d).  No transfer may occur at a time or in a manner that would have a material adverse impact on the Services.  Where Accenture may replace a person filling a Key Accenture Personnel role other than as a result of the circumstances in Section 8.4(c), Accenture will use Reasonable Efforts to not remove the replaced person until he/she has worked with the replacement person for a period of thirty (30) days to facilitate an adequate knowledge transfer.

(f)                                    Reservation of Rights.  Except as provided in this Section 8.4, Accenture reserves the right to determine which Accenture Personnel shall be assigned to perform Services, and to replace or reassign such personnel during the Term.

(g)                                 Hawaii-Based Key Personnel.  Accenture’s obligations with respect to Key On-Site Personnel shall be as described in Section 7.1.

8.5                               Responsibility for, and Removal of, Accenture Personnel.

(a)                                  The personnel assigned to the Hawaiian Telcom account by Accenture (or its subcontractors) shall be and remain employees of Accenture (or such subcontractors), and Accenture (or such subcontractors) shall provide for and pay the compensation and other benefits of such personnel, including salary, health, accident and workers’ compensation benefits and all taxes and contributions that an employer is required to pay with respect to the employment of employees, except as otherwise specified in Section 9.8(j).

(b)                                 Accenture will take Reasonable Efforts to limit turnover that Hawaiian Telcom in good faith reasonably believes to be excessive.

(c)                                  If Hawaiian Telcom reasonably determines, lawfully and in good faith, that an Accenture Personnel has engaged in misconduct, Hawaiian Telcom may request the removal of such Accenture Personnel from the Hawaiian Telcom account, with such request to include a confidential description of the alleged misconduct.  Accenture shall promptly investigate the matters forming the basis of such request.  If the alleged actions of the Accenture Personnel would be grounds for termination of employment with Hawaiian Telcom, Accenture shall suspend such Accenture Personnel from the Hawaiian Telcom account pending the completion of the investigation.  If such investigation reveals actual misconduct, Accenture will immediately remove the Accenture Personnel from the Hawaiian Telcom account.

(d)                                 If Hawaiian Telcom reasonably determines, lawfully and in good faith, that an Accenture Personnel is performing in an Unacceptable Manner, Hawaiian Telcom may request the removal of such Accenture Personnel from the Hawaiian Telcom account, with such request to include a confidential description of the reasons why the removal is needed.  Within five (5) Business Days of receiving such request, Accenture shall investigate the matters forming the basis of such request.  Accenture shall, within five (5) Business Days after the conclusion of the investigation, propose a plan to either cure and prevent a recurrence of the performance in an Unacceptable Manner.  If Hawaiian Telcom does not in good faith agree that such plan is likely to either cure and prevent a recurrence of the performance in an Unacceptable Manner, and directs Accenture to remove such individual from the Hawaiian Telcom account, Accenture will promptly do so.

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(e)                                  In the event of removal of an Accenture Personnel under Section 8.5(c) or (d), Accenture shall replace him or her with an individual meeting the requirements of Section 10.1(a).

(f)                                    Hawaiian Telcom will not use its rights under Section 8.5(d) in bad faith or for the purpose of preventing Accenture from meeting its obligations under this Agreement.

8.6                               Background Checks.  Prior to assigning any Accenture Personnel to perform the Services, all such Accenture Personnel shall be subject tothe Accenture Background Investigations and Examinations Policies & Standards, as described in Exhibit J.

8.7                               Reports.  The Parties shall establish an appropriate set of periodic reports regarding the provision of the Steady State Services by Accenture to be delivered by Accenture to Hawaiian Telcom from time to time under this Agreement, which shall include reports that are reasonably necessary to monitor Accenture’s performance of the Services to ensure they are being provided for in accordance with the terms of this Agreement (collectively, “Reports”).  Accenture will provide each Report in both an electronic and, as requested by Hawaiian Telcom, hard copy version.

8.8                               Meetings and Conference Calls.  The Parties shall determine an appropriate set of periodic meetings or telephone conference calls to be held between representatives of Hawaiian Telcom and Accenture.  Such meetings shall include the following:

(a)                                  a weekly meeting among the Hawaiian Telcom Account Representative, the Accenture Account Representative and any other appropriate operational personnel to discuss daily performance and planned or anticipated activities that may adversely affect performance of the Services or any changes;

(b)                                 a monthly management meeting of the Service Management Steering Committee; and

(c)                                  a quarterly management meeting to review relevant Service performance and other issues.

Each Party shall communicate its objectives or publish its proposed agenda for any meeting sufficiently in advance of the meeting to allow meeting participants a reasonable opportunity to prepare.

8.9                               Accenture Subcontractors.

(a)                                  Except as provided in Section 8.9(b) below, Accenture shall not subcontract all or any part of the Services identified in one or more Statements of Work or Work Orders without Hawaiian Telcom’s consent, which shall not be unreasonably withheld, conditioned or delayed.

(b)                                 Hawaiian Telcom’s consent under Section 8.9(a) above is not required with respect to (i) Accenture Affiliates; (ii) subcontractors that provide services customarily purchased from third party vendors such as facilities maintenance, hardware and software maintenance, security, storage and other ancillary services; (iii) subcontractors located at an Accenture off-site solution center who provide contract labor and not subcontracted services, provided that the use of such contract labor on the Hawaiian Telcom account does not exceed ten percent (10%) of the total number of Accenture Personnel located at such centers that are dedicated to Hawaiian Telcom; and (iv) subcontractors that have been pre-approved by Hawaiian Telcom, as set forth in Exhibit N (Approved Accenture Subcontractors).

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(c)                                  Accenture shall remain responsible for obligations under this Agreement performed by any Accenture subcontractor to the same extent as if such obligations were performed by Accenture’s employees.  Accenture shall remain Hawaiian Telcom’s sole point of contact regarding the Services.  Any reference to Accenture shall be deemed to include Accenture’s subcontractors unless the context indicates otherwise.

(d)                                 If Hawaiian Telcom expresses any concerns to Accenture regarding performance issues with any Accenture subcontractors, Accenture shall cooperate with Hawaiian Telcom to resolve such concerns on a mutually acceptable basis.

8.10                        No Solicitation.  Unless otherwise agreed by the Parties in writing, during the Term and twelve (12) months thereafter, neither Party shall, directly or indirectly, knowingly solicit for employment, offer employment to or employ or retain (whether as an employee, officer, agent, consultant, advisor or in any other capacity) any employee of the other Party who is or was actively involved in the performance or evaluation of the Services.  Notwithstanding the foregoing, the Parties acknowledge and agree that this Agreement shall not prohibit (i) solicitations through general public advertising or other publications of general public circulation or (ii) the hiring of any employee of a Party who responds to such solicitations or who otherwise contacts the other Party without such other Party having solicited such employee.

8.11                        Reprioritization of Resources.  Subject to Section 3.8(c)(i)(2), the Hawaiian Telcom Account Representative or his or her designee may identify or reprioritize or reset the schedule for existing work activities.

ARTICLE IX
PRICE & PAYMENT

9.1                               Service Charges.

(a)                                  In consideration for the performance of the Services, Hawaiian Telcom shall pay to Accenture the Charges specified in Exhibit D (Charges) plus Taxes and other amounts described in this Article IX, together with the other charges expressly specified in or provided for in this Agreement.

(b)                                 The Charges specified in Exhibit D (Charges), together with the other charges expressly specified in or provided for in this Agreement, compensate Accenture for providing all of the Services (as a whole) in accordance with this Agreement.  Accenture may not charge separately for any particular service, function, responsibility or activity or for any deliverables or other services comprising the Services beyond the Charges specified in Exhibit D (Charges) unless, and then only to the extent, expressly provided in the applicable provision of the Agreement.

(c)                                  For Services which are to be provided hereunder on a time and materials basis, unless otherwise agreed in writing by the Parties, labor will be based on the Variable Rates in Attachment D-2 (Enhancement Services Rates), and materials that have been pre-approved in writing will be reimbursable by Hawaiian Telcom as Pass Through Expenses.

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9.2                               Reimbursement of Expenses.  Hawaiian Telcom shall pay, or reimburse, Accenture for Out-of-Pocket Expenses as specified in Exhibit D (Charges).

9.3                               Pass-Through Expenses.   Exhibit D (Charges) sets forth certain expenses relating to the Services that shall be incurred by Accenture and shall be passed through to Hawaiian Telcom at Accenture’s actual, direct cost (i.e., with no handling fees, overhead or other markup by Accenture) for reimbursement by Hawaiian Telcom (“Pass-Through Expenses”).  Except as otherwise provided in this Agreement, Hawaiian Telcom shall not be responsible for any additional Pass-Through Expenses without its prior written consent.

9.4                               Invoices; Method of Payment; Finance Charges.

(a)                                  Invoicing. Invoices shall be substantially in the form described in Exhibit K (Form of Invoice).

(i)                                     Recovery Services.  For Recovery Services, Accenture shall render a single consolidated monthly invoice for the payment milestones completed during the previous month.

(ii)                                  Enhancement Services.  For Enhancement Services, Accenture shall render a single consolidated monthly invoice (i) for the payment milestones completed under a fixed price General Enhancement Work Order or Enhancement Capacity Work Order during the previous month; and (ii) for the Non-Work Order Pool Charges for the previous month.

(iii)                               AM Services.  For AM Services, Accenture shall render a single consolidated monthly invoice in advance for the AM Services.

Accenture may provide such invoices individually or may aggregate them into one invoice.

(b)                                 Invoice Intervals.  All invoices shall be provided as of the 25th day of each month (e.g., they will be measured from the 25th of one month to the 24th of the next month).  Invoices shall be due and payable thirty (30) days after Hawaiian Telcom’s receipt of Accenture’s invoice.

(c)                                  Payments.  All amounts to be paid to Accenture under this Agreement shall be paid in U.S. dollars by federal wire transfer to the account or accounts designated by Accenture from time to time or by such other method as is mutually determined by the Parties.  Any amount not paid when due shall bear interest from the day due until paid, at a rate equal to the lesser of (i) one percent (1%) per month or (ii) the maximum rate of interest allowed by applicable Laws.

9.5                               Proration.  Periodic charges under this Agreement are to be computed on a calendar month basis and shall be prorated on a per diem basis for any partial month.

9.6                               Unused Credits.  Any unused credits against future payments owed to either Party by the other pursuant to this Agreement shall be paid to the applicable Party within thirty (30) days after the expiration or termination of this Agreement.

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9.7                               Disputed Charges.

(a)                                  Hawaiian Telcom may, subject to the notification requirement below and Section 9.7(b), withhold payment of particular charges that Hawaiian Telcom reasonably and in good faith disputes (or, if it has already paid such Charges, Hawaiian Telcom may withhold an equivalent amount from payment to be made during the immediately subsequent month).  Any amounts (or portions thereof) not so disputed otherwise shall be paid by the applicable payment due date, as determined pursuant to Section 9.4(b).  Hawaiian Telcom shall notify Accenture in writing on or before the payment due date of any disputed charges for which Hawaiian Telcom is withholding payment and describe, in reasonable detail, the reason for such withholding.  Hawaiian Telcom and Accenture shall diligently pursue an expedited resolution of such dispute.

(b)                                 Notwithstanding anything to the contrary herein,  Hawaiian Telcom may not withhold at any point in time in the aggregate an amount greater than one (1) month’s fees (for disputed amounts related to the first twelve (12) months following the Effective Date) or fifty percent (50%) of one month’s fees following the twelve (12) month anniversary of the Effective Date.  In lieu of making such payment to Accenture, if the disputed amounts exceed such thresholds, but are less than the Disputed Threshold Amount, Hawaiian Telcom shall have the option of placing the amount in dispute which exceeds such threshold into an interest bearing escrow account, at Hawaiian Telcom’s expense.  To the extent that the disputed amount placed in escrow would exceed the Disputed Threshold Amount, Hawaiian Telcom shall pay Accenture the amount by which the disputed amount exceeds such threshold.

(c)                                  To the extent Hawaiian Telcom prevails in any dispute over charges for which Hawaiian Telcom paid Accenture pursuant to Section 9.7(b), Hawaiian Telcom is entitled to the disputed payment as well as interest on the disputed paid amount (paid by Hawaiian Telcom to Accenture) at the rate prescribed in Section 9.4(c) from the time the disputed amount was paid by Hawaiian Telcom until the time the refund is remitted by Accenture.  To the extent Accenture prevails in any dispute over charges, Accenture is entitled to the disputed payment as well as interest on the withheld amount at the rate prescribed in Section 9.4(c) from the time the disputed amount was due until paid by Hawaiian Telcom.

(d)                                 To the extent a dispute is resolved in favor of Accenture, Accenture shall not be entitled to revoke the licenses granted in Sections 6.5(c)(ii) and 12.1(a), unless Hawaiian Telcom has failed to pay the disputed amount within thirty (30) days following resolution of the dispute.

9.8                               Taxes.  References in this Section 9.8 to Accenture or Hawaiian Telcom shall, as relevant, be deemed to include any Affiliates of such Party that are paying or receiving any of the Charges or otherwise incurring any taxes in relation to the performance or receipt of the Services (including any charges for software or equipment, as applicable).  The Parties’ respective responsibilities for taxes arising under or in connection with this Agreement shall be as follows:

(a)                                  Each Party shall be responsible (i) for any real or personal property taxes on property it owns or leases, (ii) for franchise and privilege taxes on its business, and (iii) for taxes based on its net income or for taxes on its gross receipts.

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(b)                                 All amounts payable pursuant to this Agreement in respect of the Services and all other amounts referred to and monetary figures used in this Agreement are stated exclusive of any sales, use, excise, value added, services, withholding taxes related to cross-border payments (which are transaction taxes and which are not considered income taxes in such country), consumption, privilege, and other similar taxes or duties (collectively, “Taxes”).

(c)                                  Accenture shall be responsible for any Taxes on the goods or services used or consumed by Accenture in providing the Services (other than goods, including equipment or software, purchased, leased or licensed for Hawaiian Telcom or on Hawaiian Telcom’s behalf (in respect of which Hawaiian Telcom holds title or is the licensee, including by assignment)) where the Tax is imposed (including during the Term) on Accenture’s acquisition or use of such goods or services and the amount of Tax is measured by Accenture’s cost in acquiring such goods or services.

(d)                                 Hawaiian Telcom shall be responsible for, and shall pay or reimburse Accenture for the payment of, any Taxes imposed or assessed (including during the Term) on (i) the provision of the Services, as a whole, or on any particular Service or on the charges under this Agreement or (ii) on any equipment or software, purchased, leased or licensed for Hawaiian Telcom or on Hawaiian Telcom’s behalf (in respect of which Hawaiian Telcom holds title or is the licensee (including by assignment), if any).  Accenture shall only invoice Taxes to Hawaiian Telcom which Hawaiian Telcom is (A) obligated to pay pursuant to this Agreement, or (B) otherwise legally obligated to pay Accenture pursuant to relevant tax Laws, and in no instance shall Hawaiian Telcom be responsible for Taxes to the extent excluded pursuant to Section 9.8(f) below.

(e)                                  If a Tax is imposed or assessed on the provision of any of the Services as a whole, or on any particular Service, or the charges therefor or on any equipment or software, purchased, leased or licensed for Hawaiian Telcom or on Hawaiian Telcom’s behalf (in respect of which Hawaiian Telcom holds title or is the licensee (including by assignment)), the Parties shall work together to segregate the payments under this Agreement into three (3) payment streams:

(i)                                     those for taxable Services;

(ii)                                  those for which Accenture functions merely assist Hawaiian Telcom in obtaining or receiving goods, supplies, or services from third parties (including leasing and licensing arrangements); and

(iii)                               those for other nontaxable Services.

In addition, Accenture’s invoices shall separately state the Services, software and equipment (if any) provided to Hawaiian Telcom as reasonably requested by Hawaiian Telcom, including the geography from which Services are provided or where equipment or software is located.  Accenture shall otherwise reasonably cooperate with Hawaiian Telcom in invoicing Hawaiian Telcom in the most Tax efficient manner.

(f)                                    Hawaiian Telcom shall be responsible for and invoiced by Accenture for any new or increased Taxes, excluding Taxes based on income, that may arise from Accenture performing or providing Services from a location different than those specified in the Exhibit E (Service Locations), unless such change is initiated by Accenture (except where such Accenture initiation is the result of a change in Laws, which is addressed in Section 7.3).

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(g)                                 The Parties agree to cooperate with each other to enable each to more accurately determine its own tax liability and to minimize such liability to the extent legally permissible.  Accenture’s invoices shall separately state the amounts of any taxes Accenture is collecting from Hawaiian Telcom, and Accenture shall timely remit such taxes to the appropriate authorities.  Each Party shall provide and make available to the other any resale, multiple points of use, or other relevant exemption certificates, information regarding out-of-county, out-of-state or out-of-country sales or use of equipment, materials or services, and other exemption certificates or information reasonably requested by the other Party.

(h)                                 Accenture shall promptly notify Hawaiian Telcom of, and coordinate with Hawaiian Telcom the response to and settlement of, any claim for taxes asserted by applicable taxing authorities for which Hawaiian Telcom is responsible hereunder, it being understood that with respect to any claim arising out of a form or return signed by a Party to this Agreement, such Party shall have the right to control the response to and settlement of the claim.  If, in good faith, Hawaiian Telcom timely requests Accenture to challenge the imposition of any tax for which Hawaiian Telcom is responsible hereunder, and Hawaiian Telcom does not have standing to challenge such tax itself, Accenture shall do so in a timely manner and Hawaiian Telcom shall reimburse Accenture for the reasonable legal fees and expenses it incurs in doing so.  Notwithstanding the foregoing, Accenture shall retain the right to refuse to challenge the imposition of such tax and shall bear the associated tax costs.