November 17, 2010

Retirement Plan for Employees of Hawaiian Electric Industries, Inc. and Participating
Subsidiaries
Notice of Plan Amendment Reducing Future Early Retirement Subsidies

Notice for Bargaining Unit Employees

The Retirement Plan for Employees of Hawaiian Electric Industries, Inc. and Participating
Subsidiaries (the “HEI Retirement Plan” or “Plan”) currently provides subsidized early
retirement benefits for participants who retire after meeting the age and service requirements for
early retirement.

Subject to the collective bargaining process, Hawaiian Electric Industries, Inc. (“HEI”) intends to
amend the HEI Retirement Plan to reduce the early retirement subsidies for benefits accrued after
December 31, 2010. These changes will be effective January 1, 2011.

There are two criteria that must be met for the amendments reducing the early retirement
subsidies not to apply to you. The two criteria are that, as of December 31, 2010, you must have:

a. Attained age 45; and

b. Become fully vested in your retirement benefit. Generally, a participant becomes fully vested in
his or her retirement benefit after completing five consecutive, full years of employment with
HEI or its subsidiaries.

The retirement benefits, including the early retirement subsidies, accrued by all participants
through December 31, 2010, will remain unchanged. The amendments only affect benefits
accrued after December 31, 2010.

Following is an explanation of the current early retirement subsidies provided under the Plan and
the changes in the subsidies for benefits accrued after December 31, 2010. Examples are
provided to help you understand how these changes might affect you.

This Notice also explains an amendment to the HEI Retirement Plan that is being made in
connection with the adoption of a sick leave “bank” effective January 1, 2011. This amendment
applies to every participant in the HEI Retirement Plan.

Please read this Notice carefully.

I. How the Early Retirement Subsidies Are Calculated Under Current Plan Terms
Prior to Amendment

Generally, benefits paid prior to the attainment of normal retirement age (age 65) are reduced to
account for the fact that they will be paid for a longer period. If the benefit is reduced to the
actuarial equivalent of the benefit that would be paid at normal retirement age, the benefit is

HEI\204(h)\BU.11.17.10.3
“unsubsidized”.1 If, however, the benefit is greater than the actuarial equivalent of the benefit
that would be paid at normal retirement age (assuming no change in credited service or pay), the
benefit is “subsidized”. The amount of the subsidy is the difference between the actual
percentage of the reduction from the normal retirement benefit payable at age 65 and the
percentage of the reduction that would apply if the full actuarial equivalent reduction applied.
For example, if the actual reduction is 70% of the age 65 benefit and the full actuarial equivalent
reduction would be 43%, the subsidy is 27% (70% - 43% = 27%). If the benefit paid prior to age
65 is equal to the payment that would be paid at age 65, using the same credited service and pay,
the benefit is “fully subsidized”.

Currently, the HEI Retirement Plan provides subsidized early retirement benefits for two sets of
participants: (1) participants who retire after attaining age 55 with at least 5 years of vesting
service, and (2) participants who retire after age 50 with at least 5 years of vesting service and
meet the “rule of 65”. The rule of 65 is the attainment of at least age 50 plus a number of
completed full years of vesting service such that the participant’s age (in full years) plus the
number of full years of vesting service equals 65 years. For example, a participant who is age 53
and has 12 years of vesting service has met the rule of 65 (age 53 + 12 years of vesting service =
65).

A participant who retires after becoming eligible for early retirement and after attaining age 60 is
entitled to receive a fully subsidized benefit (i.e., a benefit that is equal to the benefit that the
participant would receive at age 65, if there were no change in the participant’s credited service
or pay). For retirements between ages 55 and 59, there is a 1% reduction for each year prior to
age 60. For retirements between ages 50 and 54, there is a 5% reduction for each year prior to
age 55. The reduction is more easily explained in the following table as a percentage of the
benefit that would be paid at normal retirement:

Age at Retirement* Percentage of Normal Retirement Benefit Payable

at Early Retirement Date
60 - 65 100%
59 99%
58 98%
57 97%
56 96%
55 95%
54 90%
53 85%
52 80%
51 75%
50 70%
*Note: The factor depends upon the participant’s age (in full years and months) when benefits
start. For example, if the participant is age 52 years and 6 months, the factor is 82.5%.

1
“Actuarial equivalence” is a term that is used to compare two benefits that are paid at different times or in
different forms. Two benefits are considered to be “actuarially equivalent” if they have equivalent value when
determined using assumptions for mortality (life expectancy) and interest. Currently, “actuarial equivalence” is
determined using the “Applicable Interest Rate” and “Applicable Mortality Table,” which are specified in the
Internal Revenue Code and are subject to change on an annual basis.

2
The subsidies shown in the table above will continue to apply for all benefits accrued prior to
January 1, 2011, based on years of credited service and final pay as of December 31, 2010.
Benefits accrued after December 31, 2010, will be eligible for the reduced subsidies described in
Part II below.

For participants who have attained age 45 and become fully vested in their retirement benefits as
of December 31, 2010, the subsidies shown in the table above will continue to apply for all
benefit accruals, both before and after December 31, 2010.

II. How the Early Retirement Subsidies Are Calculated Under the Amended Plan
Terms

HEI intends to amend the HEI Retirement Plan to reduce the subsidies available for retirement
prior to age 62. These reductions apply only to benefits accrued after December 31, 2010. For
retirements between ages 62 and 64, the benefit will continue to be fully subsidized. For
retirements between the ages of 55 and 61, there will be a 3% reduction for each year prior to age
62. For retirements prior to age 55, there will be no subsidy available. A participant retiring
after age 50 and before age 55 will receive the actuarial equivalent of the age 65 benefit. The
amended early retirement reduction factors are shown in the table below, which compares the
new factors to the factors applicable prior to these amendments. The new factors for retirements
in years prior to age 55 are the actuarial equivalent factors. The actuarial equivalent factors are
subject to change each year.

Age at Retirement Percentage of Normal Retirement Percentage of Normal

Benefit Payable at Early Retirement Retirement Benefit Payable
Date at Early Retirement Date
(Old Factors, Which Remain in (New Factors, Applicable to
Effect for Benefits Accrued Prior to Benefits Accrued After
January 1, 2011) December 31, 2010)
62 - 65 100% 100%
61 100% 97%
60 100% 94%
59 99% 91%
58 98% 88%
57 97% 85%
56 96% 82%
55 95% 79%
54 90% 56%
53 85% 52%
52 80% 48%
51 75% 45%
50 70% 43%

As you can see, the difference between the old and new factors increases as retirement precedes
age 62. The greatest difference occurs for retirements prior to age 55, when there is no longer
any subsidy available.

3
III. How Will These Amendments Affect Your Retirement Benefit?

If you have attained age 45 and become fully vested in your retirement benefit as of December
31, 2010, the amendments reducing the early retirement subsidies do not apply to you. The
subsidies described in Part I of this Notice will continue to apply to all accruals you have under
the Plan, including accruals after December 31, 2010.

If you have not attained age 45 or become fully vested in your retirement benefit as of December
31, 2010, you will have two pieces to your retirement benefit: (1) benefits accrued prior to
January 1, 2011, based on your years of credited service and final pay as of December 31, 2010,
plus (2) benefits accrued after December 31, 2010. Your benefits accrued prior to January 1,
2011, will be eligible for the subsidies described in Part I of this Notice. Your benefits accrued
after December 31, 2010, will be eligible only for the reduced subsidies described in Part II of
this Notice.

Federal law requires that all benefits accrued as of December 31, 2010, be protected. One way to
have done this would have been simply to add the two pieces of your benefit together, so that
when you retired, your total benefit would have equaled Piece One (benefits accrued before
January 1, 2011), plus Piece Two (benefits accrued after December 31, 2010). However, the
amendments are more generous than the law requires. Under the amendments, your total normal
retirement benefit will first be calculated the same way as it was before the amendment. Then
the portion of the benefit that accrued before January 1, 2011, will be subtracted from the total
benefit. That portion, Piece One, will be eligible for the subsidies described in Part 1 of this
Notice. The difference (the total benefit minus Piece One) is Piece Two, and it will be eligible
only for the subsidies described in Part II of this Notice. The effect of this design is that, if you
continue in employment to age 62 (or are deemed to be age 62 under the Plan’s rules at the time
of your retirement), the amendments will have no effect on your benefit.

The following example is intended to help you better understand these amendments and their
potential effects on your retirement benefit. In the example, the employee is 35 years of age with
10 years of service credit as of December 31, 2010. The example demonstrates what happens if
the participant retires at ages 50, 55, 60, and 62.

Example:

If you are covered by the IBEW bargaining unit agreement, your monthly normal retirement
income (commencing at your normal retirement date in the form of a single life annuity) is
computed by multiplying:

a) 1.83% times your total years of credited service (the product not to exceed 60%),
times

b) your monthly rate of straight-time pay at your date of termination of employment

(“Final Pay”).

As of December 31, 2010, Participant BU, a bargaining unit employee, is age 35 and has 10
years of credited service. Participant BU’s monthly rate of straight-time pay is determined by
multiplying Participant BU’s hourly rate of straight-time pay ($31/hour) by 173.3333 hours ($31

4
x 173.3333 = $5,373.33).2 Participant BU’s accrued benefit as of December 31, 2010, is the
benefit that would be payable at Participant BU’s normal retirement date (in the form of a single
life annuity3) if Participant BU terminated employment on December 31, 2010. Participant BU’s
accrued benefit as of December 31, 2010, is calculated as follows:

1.83% x 10 (years of credited service) x $5,373.33 = $983.32 per month ($11,799.84 per
year). This is Piece One of Participant BU’s retirement benefit.

Let’s assume Participant BU continues in employment and retires at different ages: ages 50, 55,
60, and 62. Let’s further assume that Participant BU’s rate of straight-time pay increases 1%
annually until Participant BU’s retirement. The following shows what benefits would be payable
at the different ages.

Age 50 Benefit

If Participant BU retires at age 50, Participant BU will have 25 years of credited service, 15
years of which accrued after December 31, 2010. Participant BU’s hourly rate of straight-time
pay is assumed to be $35.99, which converts to a monthly rate of $6,238.26.

Piece Two of Participant BU’s retirement benefit is the benefit that accrued after December 31,
2010. It is calculated as follows:
1.83% x 25 (years of credited service) x $6,238.26 = $2,854 per month ($34,248 per
year).
Piece One ($983.32 per month) is subtracted from the total benefit ($2,854 per month).
The difference, $1,870.68 per month ($2,854 - $983.32 = $1,870.68), is Piece Two of
Participant BU’s retirement benefit.
Since Participant BU will have retired prior to age 65, Participant BU’s benefit must be reduced
for early retirement. Piece One, the piece of the benefit accrued prior to January 1, 2011, is
eligible for the subsidies described in Part 1 of this Notice. At age 50, the early retirement
benefit is reduced to 70% of the normal retirement benefit. Because Participant BU has retired
prior to age 55, no subsidy is available for Piece Two of the benefit accrued after December 31,
2010. Piece Two is reduced to 43% of the normal retirement benefit. Participant BU’s total
benefit at age 50 would be calculated as follows:
Piece One: $ 983.32 per month x .70 = $ 688.32
Piece Two: $1,870.68 per month x .43 = $ 804.39
Total per month = $1,492.71
The calculation of the age 50 benefit is illustrated in the Appendix to this Notice.

Age 55 Benefit

If Participant BU retires at age 55, Participant BU will have 30 years of credited service, 20
years of which accrued after December 31, 2010. Participant BU’s hourly rate of straight-time

2
The monthly hours (173.3333) are derived by multiplying 40 hours per week x 52 weeks and then dividing by 12
months (40 x 52 = 2080 hours ÷ 12 = 173.3333 hours).
3
A “single life annuity” provides a monthly benefit for the life of the participant with no survivor or death benefits.

5
pay is assumed to be $37.82, which converts to a monthly rate of $6,555.46.

Piece Two of Participant BU’s retirement benefit is the benefit that accrued after December 31,
2010. It is calculated as follows:
1.83% x 30 (years of credited service) x $6,555.46 = $3,598.95 per month ($43,187.40
per year).
Piece One ($983.32 per month) is subtracted from the total benefit ($3,598.95 per
month). The difference, $2,615.63 per month ($3,598.95 - $983.32 = $2,615.63), is Piece
Two of Participant BU’s retirement benefit.
Since Participant BU will have retired prior to age 65, Participant BU’s benefit must be reduced
for early retirement. Piece One, the piece of the benefit accrued prior to January 1, 2011, is
eligible for the subsidies described in Part 1 of this Notice. At age 55, the early retirement
benefit is reduced to 95% of the normal retirement benefit. Because Participant BU has reached
age 55, a reduced subsidy is available for Piece Two of the benefit accrued after December 31,
2010. Piece Two is reduced to 79% of the normal retirement benefit. Participant BU’s total
benefit at age 55 would be calculated as follows:
Piece One: $ 983.32 per month x .95 = $ 934.15
Piece Two: $2,615.63 per month x .79 = $2,066.35
Total per month = $3,000.50
The calculation of the age 55 benefit is illustrated in the Appendix to this Notice.

By working to age 55, Participant BU would be able to double his monthly retirement benefit.

Age 60 Benefit

If Participant BU retires at age 60, Participant BU will have 35 years of credited service, 25
years of which accrued after December 31, 2010. Participant BU’s hourly rate of straight-time
pay is assumed to be $39.75, which converts to a monthly rate of $6,890.

Piece Two of Participant BU’s retirement benefit is the benefit that accrued after December 31,
2010. It is calculated as follows:

60% (1.83% x 35 years of credited service, not to exceed 60%) x $6,890 = $4,134.00 per
month ($49,608 per year). Although the benefit is limited to 60% of Final Pay, the years
of credited service that cannot be counted in the retirement formula are not completely
lost. Specifically, each full year of credited service over 33 increases a participant’s age
in determining the early retirement reduction factors, as demonstrated below.

Piece One ($983.32 per month) is subtracted from the total benefit ($4,134.00 per
month). The difference, $3,150.68 per month ($4,134.00 - $983.32 = $3,150.68), is Piece
Two of Participant BU’s retirement benefit.

Since Participant BU will have retired prior to age 65, Participant BU’s benefit must be reduced
for early retirement, unless it is fully subsidized, which it is here. Piece One, the piece of the
benefit accrued prior to January 1, 2011, is eligible for the subsidies described in Part 1 of this

6
Notice. At age 60, the early retirement benefit is fully subsidized. Generally, at age 60, a
reduced subsidy is available for Piece Two of the benefit accrued after December 31, 2010.
However, because Participant BU has 2 full years of service credit in excess of 33, Participant
BU is deemed to be age 62 for purposes of determining the subsidy. At age 62, the benefit under
the new formula is also fully subsidized. Participant BU’s total benefit at age 60 would be
calculated as follows:
Piece One: $ 983.32 per month x 1.00 = $ 983.32
Piece Two: $3,150.68 per month x 1.00 = $3,150.68
Total per month = $4,134.00
The calculation of the age 60 benefit is illustrated in the Appendix to this Notice.

Age 62 Benefit

If Participant BU retires at age 62, Participant BU will have 37 years of credited service, 27
years of which accrued after December 31, 2010. Participant BU’s hourly rate of straight-time
pay is assumed to be $40.55, which converts to a monthly rate of $7,028.66.

Piece Two of Participant BU’s retirement benefit is the benefit that accrued after December 31,
2010. It is calculated as follows:
60% (1.83% x 37 years of credited service, not to exceed 60%) x $7,028.66 = $4,217.20
per month ($50,606.40 per year).
Piece One ($983.32 per month) is subtracted from the total benefit ($4,217.20 per
month). The difference, $3,233.88 per month ($4,217.20 - $983.32 = $3,233.88), is Piece
Two of Participant BU’s retirement benefit.
At age 62, benefits are fully subsidized for both Pieces One and Two of Participant BU’s benefit.
Participant BU’s total benefit at age 62 would be calculated as follows:
Piece One: $ 983.32 per month x 1.00 = $ 983.32
Piece Two: $3,233.88 per month x 1.00 = $3,233.88
Total per month = $4,217.20
The calculation of the age 62 benefit is illustrated in the Appendix to this Notice.

Under the facts assumed in this example (that Participant BU had 35 years of credited service at
age 60), the only difference in the age 60 benefit and the age 62 benefit is attributable to the
difference in the assumed Final Pay at retirement.

These are only examples, and they are based on assumptions, including assumptions as to pay.
The assumptions used in determining actuarial equivalence, which is used to calculate the early
retirement reduction factors for Piece Two benefits paid before age 55 are based on assumptions
as to interest and mortality that are prescribed by the Internal Revenue Service and subject to
change annually.

7
IV. Amendment to the HEI Retirement Plan in Connection with the Adoption of a Sick
Leave “Bank” Effective January 1, 2011

If you retire from active employment or die while in active employment at or after age 55, any
full months of sick leave not used in the current year or the last two calendar years (up to 480
hours per year, maximum of 1,440 hours over three years) will be used to increase your
retirement benefit either by increasing your credited service or increasing your age for purposes
of determining the early retirement subsidy. For example, if adding the unused sick leave to
credited service results in an additional full year of credited service over 33 years, your actual
age will be increased by the total number of years of credited service over 33 for purposes of
determining the early retirement subsidy.

Example: Assume you are age 58 at your early retirement date and have 33.5 years of
credited service plus 1440 hours (8 months) of unused sick leave. Since the additional
unused sick leave results in 34.1667 years of credited service, your retirement benefit will
be calculated by adding 1 year to your age and your benefit will be determined as if you
were age 59.

Further information about the way unused sick leave may be used to increase your retirement
benefit is available in the Summary Plan Description for the HEI Retirement Plan dated June 1,
2009, which is available on-line at HR Suite>My Employee Self Service>My Benefits. The
methods for using unused sick leave to increase your retirement benefits are not being changed
by this amendment.

Effective January 1, 2011, HEI is amending the HEI Retirement Plan to replace the two-year
look-back with an unlimited look-back “bank”. Your original bank will consist of the unused
sick leave from the calendar years 2009 and 2010, but thereafter may include unused sick leave
from any number of years, subject, however, to the continuing maximum limit of 1,440 hours.

This amendment to the HEI Retirement Plan is made in conjunction with a change in sick leave
benefits also effective as of January 1, 2011. In particular, the sick leave available to employees
with 3 or more years of service will be reduced after 2010. The new sick leave benefits are
shown in the table below:

Years of Service Current Sick New Sick Leave Date Available

Leave Benefits Benefits
Date of Hire 0 40 Date of hire
6 months 40 0 ---
1 year 40 80 1 year anniversary
2 years 80 80 50% Jan 1, 50% July 1
3 – 6 years 160 128 50% Jan 1, 50% July 1
7 – 9 years 320 256 50% Jan 1, 50% July 1
10+ years 480 384 50% Jan 1, 50% July 1

The method of applying the unused sick leave will not change under the HEI Retirement Plan.
However, for calendar years after 2010, there will be less sick leave available. By creating a
“bank,” employees will still be able to accumulate sick leave of up to 1440 hours which may be

8
used in calculating retirement benefits after age 55, but it will take more than three years to
accumulate the maximum unused sick leave that may be used in your retirement benefit
calculation.

This Notice is intended to satisfy the notice requirement under section 204(h) of the Employee
Retirement Income Security Act of 1974 and section 4980F of the Internal Revenue Code. This
Notice is also intended to serve as a summary of material modifications to the information
provided in the Summary Plan Description for the HEI Retirement Plan dated June 1, 2009,
which is available on-line at HR Suite>My Employee Self Service>My Benefits.

If there are any differences between the information in this Notice and in the Plan, or to the
extent the Plan contains more complete or detailed information or rules, the provisions of the
Plan will control.

If you have any questions concerning this Notice or would like a copy of the Summary Plan
Description for the HEI Retirement Plan, please contact Julie Price at (808) 543-4670.

9
 Appendix

Calculation of Retirement Benefits from Examples

Age 50 Benefit
Piece One Piece Two
12/31/2010 Age 50
Yrs of Svc 12/31/10 10 Total Yrs of Svc 25
BU Multiplier x 1.83% x 1.83%
Final Pay 12/31/10 x $5,373.33 Final Pay at Age x $6,238.26
50 (assumed)
Benefit/Month $983.32 $2,854.00
Less Piece One - $983.32
$1,870.68
Early Retirement x 70% New Early x 43%
Factor Retirement Factor
$688.32 $804.39 = $1,492.71

Age 55 Benefit
Piece One Piece Two
12/31/2010 Age 55
Yrs of Svc 12/31/10 10 Total Yrs of Svc 30
BU Multiplier x 1.83% x 1.83%
Final Pay 12/31/10 x $5,373.33 Final Pay at Age x $6,555.46
55 (assumed)
Benefit/Month $983.32 $3,598.95
Less Piece One - $983.32
$2,615.63
Early Retirement x 95% New Early x 79%
Factor Retirement Factor
$934.15 $2,066.35 = $3,000.50

A-1
 Age 60 Benefit
Piece One Piece Two
12/31/2010 Age 60
Yrs of Svc 12/31/10 10 Total Yrs of Svc 35
BU Multiplier x 1.83% x 1.83%
Final Pay 12/31/10 x $5,373.33 Final Pay at Age x $6,890.00
60 (assumed)
Benefit/Month $983.32 *limited to 60% of $4,134.00*
Final Pay
Less Piece One - $983.32
$3,150.68
Early Retirement x 100% New Early x 100%
Factor Retirement Factor
$983.32 $3,150.68 = $4,134.00

Age 62 Benefit
Piece One Piece Two
12/31/2010 Age 62
Yrs of Svc 12/31/10 10 Total Yrs of Svc 37
BU Multiplier x 1.83% x 1.83%
Final Pay 12/31/10 x $5,373.33 Final Pay at Age x $7,028.66
62 (assumed)
Benefit/Month $983.32 *limited to 60% of $4,217.20*
Final Pay
Less Piece One - $983.32
$3,233.88
Early Retirement x 100% New Early x 100%
Factor Retirement Factor
$983.32 $3,233.88 = $4,217.20

A-2