Executive Employment Agreement

ALASKA COMMUNICATIONS SYSTEMS GROUP, INC.
600 TELEPHONE AVENUE
ANCHORAGE, AK 99503


October 17, 2003


Mr. David C. Eisenberg 10804 West 128th Terrace Overland Park, KS 66213


Re: Employment Agreement


Dear Mr. Eisenberg:


This letter agreement ("Agreement") sets forth the terms and conditions of your employment with Alaska Communications Systems Holdings, Inc. (hereinafter "ACS" or the "Company"), effective as of October 31, 2003 (hereinafter, the "Effective Date" or "the commencement of your employment with ACS").


1. Employment and Services. ACS hereby employs you as Sr. Vice President, Corporate Strategy and Development (hereinafter "Executive" or "you") for the period beginning on the Effective Date and ending upon termination pursuant to paragraph 4 (the "Employment Period"). During the Employment Period, you shall render such services to the Company and its affiliates and subsidiaries as the Boards of Directors of Alaska Communications Systems Group, Inc. and Alaska Communications Systems Holdings, Inc. and its subsidiaries (hereinafter "Boards of Directors") shall reasonably designate from time to time, and you shall devote your best efforts and full time and attention as an Executive Officer to the business of the Company. "Executive Officer" for the purpose of this Agreement is defined as a controlling officer with the authority and responsibility to direct areas of the Company's business under the direction of and as assigned by the CEO, Boards of Directors, or both. Authority extends to operational decision making and goal setting for assigned responsibilities and accountabilities of the business as required by and to support the company strategy and achievement of corporate goals. Your primary responsibilities and accountabilities are outlined in Appendix A to this agreement.


2. Compensation. The Company shall pay you an annual base salary ("Annual Base Salary") of $250,000 during the first year of the Employment Period, subject to annual review in each year of the Employment Period thereafter (for any partial year during the Employment Period, the Annual Base Salary shall be prorated based on the number of days during such year on which you are employed by the Company). Your Annual Base Salary may be increased in years following the first year of employment but may not be decreased. As used herein, the term


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"Annual Base Salary" refers to the Annual Base Salary as so increased. Such Annual Base Salary shall be payable in installments in accordance with the Company's regular payroll practices.


In addition, you will be eligible to receive an annual bonus to be awarded ninety (90) days after the end of each fiscal year, to be paid as soon as practicable but not later than one hundred twenty (120) days after the end of the fiscal year. In order to determine the amount of such bonus, the Company, acting in good faith, shall determine appropriate Company business targets for each fiscal year and your annual bonus shall be based upon 100% attainment of such targets. As a benchmark for such bonuses, the Company agrees that if the Company attains the mutually determined business targets, you shall receive a bonus equal to one hundred percent (100%) of your Annual Base Salary as in effect with respect to any such fiscal year, and in the event that the Company exceeds or does not exceed the business targets, there shall be appropriate adjustments in the amount of your annual bonus. The determination of appropriate business targets shall take place not later than sixty (60) days subsequent to the commencement of the Company's fiscal year, and all Business targets shall be provided in writing to you within thirty (30) days of the Company's determination of said business targets.


Hiring Bonus. Within thirty (30) days of the commencement of your employment with ACS you shall receive a hiring bonus of $100,000. In the event of voluntary termination within twelve consecutive months of the commencement of your employment with ACS, you will be required to repay a pro-rated amount of the hiring bonus equivalent to one-twelfth of the total for each month not served in the first twelve-month period of employment.


Equity Package. You will receive a total of 200,000 ACS stock options with an exercise price equal to the fair market value of ACS stock on the commencement date of your employment and having a term of 10 years. Options shall vest at 20% or 40,000 shares per twelve-month period for the five-year period starting with the commencement of your employment with ACS or on a Change in Control, whichever is earlier. Vesting ceases and the term of unvested options lapse upon termination of employment for any reason. Upon termination of employment, vested options may be exercised for the applicable period provided for in the applicable plan.


3. Benefits. During the Employment Period, you shall be entitled to participate in the Company's fringe benefit plans, subject to and in accordance with applicable eligibility requirements, such as life and disability insurance plans and all other benefit plans (other than severance plans or arrangements) generally available to the Company's Executive Officers, including vehicle allowance and relocation of personal residence benefits except as with respect to relocation of personal residence benefits upon termination of Executive's employment, in which case, Section 4 herein will govern Relocation of personal residence benefits will be provided in the event that your work location is moved more than forty (40) miles from the ACS Headquarters, as in place on the Effective Date of this Agreement, and you elect to move within three (3) months of assignment of a new work location.


4. Termination and Severance. The Employment Period shall terminate on the first to occur of:


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a. ninety (90) days following written notice by you to the
Company of your resignation without Good Reason, (it being
understood that you will continue to perform your services
hereunder during such ninety (90) day period),


b. thirty (30) days following written notice by you to the
Company of your resignation with Good Reason during the
Employment Period, or ninety (90) days following a Change in
Control (it being understood that you will continue to perform
your services hereunder during such ninety (90) day period),


c. your death or Disability,


d. a vote of the Boards of Directors of Alaska Communications
Systems Group, Inc., or Alaska Communications Systems
Holdings, Inc. or in the event the Agreement is assigned to a
subsidiary, the applicable Board of Directors, directing such
termination for Cause,


e. a vote of the Boards of Directors of Alaska Communications
Systems Group, Inc., or Alaska Communications Systems
Holdings, Inc. or in the event the Agreement is assigned to a
subsidiary, the applicable Board of Directors, directing such
termination without Cause,


f. the fifth anniversary of the Effective Date (the "Scheduled
Expiration Date"); provided, however, that the Scheduled
Expiration Date shall be automatically extended for successive
one-year periods unless, at least ninety (90) days prior to
the then-current Scheduled Expiration Date, either the Company
or you shall give written notice to the other of an intention
not to extend the Employment Period, or


g. the termination of Alaska Communications Systems Group, Inc.,
Alaska Communications Systems Holdings, Inc. or in the event
the Agreement is assigned to a subsidiary, the applicable
company's business operations.


In the event of termination of the Employment Period pursuant to the above defined clause (b.), (e.), (g.), or pursuant to clause (f.) as a result of the Company's notice to you of an intention not to extend the Employment Period, the Company shall concurrently with such termination make a lump-sum payment to you equal to the sum of one times your Annual Base Salary plus one times your target annual bonus payment, established pursuant to Section 2 hereof. You shall also be reimbursed for the cost of continuing your health insurance coverage under COBRA for the twelve (12) month period following such a termination.


In the event of termination of employment pursuant to the above defi ...