Attached files
| file | filename |
|---|---|
| 10-K - TOWERSTREAM CORP | v177599_10k.htm |
| EX-31.2 - TOWERSTREAM CORP | v177599_ex31-2.htm |
| EX-23.1 - TOWERSTREAM CORP | v177599_ex23-1.htm |
| EX-21.1 - TOWERSTREAM CORP | v177599_ex21-1.htm |
| EX-32.1 - TOWERSTREAM CORP | v177599_ex32-1.htm |
| EX-32.2 - TOWERSTREAM CORP | v177599_ex32-2.htm |
| EX-31.1 - TOWERSTREAM CORP | v177599_ex31-1.htm |
EXHIBIT
10.11
TOWERSTREAM
CORPORATION
2008
NON-EMPLOYEE DIRECTORS COMPENSATION PLAN
1. Purpose of the
Plan.
This 2008
Non-Employee Directors Compensation Plan (the “Plan”) is intended as an
incentive to enable Towerstream Corporation, a Delaware corporation (the
“Company”), to attract and retain the services of experienced and
highly-qualified individuals as directors of the Company and to encourage stock
ownership by such directors so that their interests are aligned with the
interests of the Company and its stockholders. It is intended that
participants in the Plan may acquire or increase their proprietary interests in
the Company and be encouraged to remain in the directorship of the
Company. For purposes of the Plan, a parent corporation and a
subsidiary corporation shall be as defined in Sections 424(e) and 424(f) of the
Internal Revenue Code of 1986, as amended (the “Code”).
2. Administration of the
Plan.
The Plan
shall be administered by the Board of Directors of the Company and/or
by a duly appointed committee of the Board having such powers as shall be
specified by the Board (the “Board”). Any subsequent references
herein to the Board shall also mean the committee if such committee has been
appointed and, unless the powers of the committee have been specifically
limited, the committee shall have all of the powers of the Board granted herein,
including, without limitation, the power to terminate or amend the Plan at any
time subject to the terms of the Plan and any applicable limitations imposed by
law. The Board shall have authority to administer the Plan subject to
the provisions of the Plan but shall have no authority, discretion or power to
select the non-employee directors of the Company who will receive options under
the Plan, to set the exercise price of the options granted under the Plan, to
determine the number of shares of common stock to be granted upon exercise of
options or the time at which such options are to be granted, to establish the
duration of option grants, or to alter other terms or conditions specified in
the Plan. All questions of interpretation of the Plan or of any
options granted under the Plan (an “Option”) shall be determined by the Board,
and such determinations shall be final and binding upon all persons having an
interest in the Plan and/or any Option. Any officer of the Company
shall have the authority to act on behalf of the Company with respect to any
matter, right, obligation, or election which is the responsibility of or which
is allocated to the Company herein, provided the officer has apparent authority
with respect to such matter, right, obligation, or election.
3. Eligibility.
Options
and cash fees may be granted only to directors of the Company who, at the time
of such grant, are not employees of the Company or of any parent or subsidiary
corporation of the Company (“Non-Employee Directors”). Options
granted to Non-Employee Directors shall be nonqualified stock options; that is,
options that are not treated as having been granted under Section 422(b) of the
Code. A person granted an Option is hereinafter referred to as an
“Optionee.”
1
4. Cash Fees.
Each
Non-Employee Director shall receive an annual retainer fee of $25,000 payable in
cash, for serving as a director of the Company. In addition, each Non-Employee
Director shall be entitled to receive a fee, payable in cash, of $1,000 for each
meeting of the Board and $500 for any committee thereof attended in person or
telephonically and shall be reimbursed for his or her expenses reasonably
incurred in connection with serving on the Board.
5. Shares Subject to
Plan.
Subject
to adjustment as provided in Section 8 hereof, a total of 1,000,000 shares of
the Company’s common stock, par value $0.001 per share (the “Stock”), shall be
subject to the Plan. The shares of Stock subject to the Plan shall
consist of unissued shares or treasury shares, and such amount of shares of
Stock shall be and is hereby reserved for such purpose. Any of such
shares of Stock that may remain unsold and that are not subject to outstanding
Options at the termination of the Plan shall cease to be reserved for the
purposes of the Plan, but until termination of the Plan the Company shall at all
times reserve a sufficient number of shares of Stock to meet the requirements of
the Plan. If an Option expires or becomes unexercisable without
having been exercised in full, or is forfeited, the unpurchased shares which
were subject thereto shall become available for future grant or sale under the
Plan. Stock used to pay the exercise price of an Option shall not
become available for future grant or sale under the Plan. Stock used
to satisfy tax withholding obligations shall not become available for future
grant to sale under the Plan.
6. Time for Granting
Options.
All
Options shall be granted, if at all, within five (5) years from the Effective
Date.
7. Terms, Conditions and Form of
Options.
Options
granted pursuant to the Plan may be evidenced by written agreements specifying
the number of shares of Stock covered thereby, which written agreement may
incorporate all or any of the terms of the Plan by reference and shall comply
with and be subject to the following terms and conditions:
(a) Automatic Grant of
Options. Options shall be granted automatically and without
further action of the Board, as follows:
(i) Each
Non-Employee Director will receive 50,000 options to acquire shares of our Stock
during each year of continued service to the Board of Directors on the first
business day of June of each year; provided that the recipient Non-Employee
Director is then serving on the Board of Directors, or re-elected to serve on
the Board of Directors, as the case may be. Any annual award shall be
subject to a pro rata reduction for service of less than one full year since the
date of joining the Board of Directors. The annual award, if subject
to such pro rata reduction, shall be reduced as follows:
2
|
Date
of Joining Board
|
Reduction
Amount
|
|
First
business day of June to September 30th
|
no
reduction
|
|
October
1st
to December 31st
|
reduced
by 12,500 options
|
|
|
|
|
January
1st
to March 31st
|
reduced
by 25,000 options
|
|
April
1st
to last business day of May
|
reduced
by 37,500 options
|
(i) Notwithstanding
the foregoing, any person may elect not to receive an Option to be granted
pursuant to this Section 7(a) by delivering written notice of such election to
the Board no later than the day prior to the date on which such Option would
otherwise be granted. A person so declining an Option shall receive
no payment or other consideration in lieu of such declined Option. A
person who has declined an Option may revoke such election by delivering written
notice of such revocation to the Board no later than the day prior to the date
on which such Option would be granted pursuant to this Section
7(a).
(ii) Notwithstanding
any other provision of the Plan to the contrary, no Option shall be granted to
any individual on a day when he or she is no longer serving as a Non-Employee
Director of the Company.
(iii) Options
granted in accordance with this Section 7(a) shall not be binding on the Company
and no person shall have any rights thereunder unless and until the Plan or any
individual Option grant shall be approved by the stockholders of the Company
within one year of the date of grant.
(b) Option Exercise
Price. The purchase price of each share of Stock purchasable
under an Option shall be the Fair Market Value of such share of Stock on the
date the Option is granted. “Fair Market Value” means for the purpose
of the Plan, for any date, the price determined by the first of the following
clauses that applies: (i) if the Stock is then listed or quoted on any
established stock exchange or national market system (a “Trading Market”), the
daily volume weighted average price of the Stock for such date (or the nearest
preceding date) on the Trading Market on which the Stock is then listed or
quoted as reported by Bloomberg L.P. (based on a day on which the New York Stock
Exchange is open for trading from 9:30 a.m. (New York City time) to 4:02 p.m.
(New York City time); (ii) if the OTC Bulletin Board is not a Trading
Market, the volume weighted average price of the Stock for such date (or the
nearest preceding date) on the OTC Bulletin Board; (iii) if the Stock is not
then quoted for trading on the OTC Bulletin Board and if prices for the Common
Stock are then reported in the “Pink Sheets” published by Pink Sheets, LLC (or a
similar organization or agency succeeding to its functions of reporting prices),
the most recent bid price per share of the Stock so reported; or (iv) in all
other cases, the fair market value of a share of Stock as determined by the
Board in good faith in a manner consistent with the provisions of the
Code. Anything in this Section 7(b) to the contrary notwithstanding,
in no event shall the purchase price of a share of Stock be less than the
minimum price permitted under the rules and policies of any national securities
exchange on which the shares of Stock are listed.
3
(c) Exercise Period and Exercisability of
Options. An Option granted pursuant to the Plan shall be
exercisable for a term of five (5) years. Options granted pursuant to
the Plan shall become exercisable on the date of grant; provided, however, that no option shall
be exercisable until such time as any limitation required by Section 16 of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), and related
rules and regulations shall be satisfied for availability of the exemption
provided under Rule 16b-3(d)(3) of the Exchange Act.
(d) Termination of
Options.
(i) In
the event that an Optionee ceases to be a director of the Company because the
Optionee has become permanently disabled (within the meaning of Section 22(e)(3)
of the Code), the Option granted to such Optionee may be exercised by the
Optionee, to the extent the Option was exercisable on the date such Optionee
ceases to be a director. Such Option may be exercised at any time
until the earlier of (a) one (1) year after the date the Optionee ceases to be a
director and (b) the date on which the Option otherwise expires by its terms, at
which time the Option shall expire; provided, however, if the Optionee dies
before the Options are forfeited and no longer exercisable, the terms and
provisions of Section 7(d)(ii) shall control.
(ii) In
the event of the death of an Optionee, the Option granted to such Optionee may
be exercised, to the extent the Option was exercisable on the date of such
Optionee’s death, by the estate of such Optionee or by any person or persons who
acquired the right to exercise such Option by bequest or inheritance or
otherwise by reason of the death of such Optionee. Such Option may be
exercised at any time until the earlier of (a) one (1) year after the date the
Optionee ceases to be a director and (b) the date on which the Option otherwise
expires by its terms, at which time the Option shall expire.
(iii) In
the event that an Optionee ceases to be or is removed as a director of the
Company on account of fraud, dishonesty, conviction of a felony under any state
or federal statute or other acts detrimental to the interests of the Company or
any direct or indirect subsidiary of the Company, or for any other reason that,
upon a good faith determination by the Board or the stockholders of the Company,
is deemed to constitute “cause”, provided, however, that it is specifically
understood that “cause” shall not include the commission or omission of any act
taken in the good-faith exercise of such Optionee’s business judgment as a
Non-Employee Director, the Option granted to such Optionee shall terminate as of
the date of the action giving rise to such termination for “cause” and no
unexercised Option or portion of an Option may thereafter be
exercised.
(iv) In
the event that an Optionee is removed as a director by the Company at any time
other than for “cause” pursuant to Section 7(d)(iii) or resigns as a director,
the Option granted to such Optionee may be exercised by the Optionee, to the
extent the Option was exercisable on the date such Optionee ceases to be a
director. Such Option may be exercised at any time until the earlier
of (a) one (1) year after the date the Optionee ceases to be a director and (b)
the date on which the Option otherwise expires by its terms, at which time the
Option shall expire; provided, however, if the Optionee dies before the Option
is forfeited and no longer exercisable, then the terms and provisions of Section
7(d)(ii) shall control.
4
(e) Payment of Option
Exercise. Payment of the exercise price for the number of
shares of Stock being purchased pursuant to any Option shall be made (i) in
cash, by certified check or bank draft or by such other instrument as may be
acceptable to the Company or by wire transfer of immediately available funds,
(ii) by surrender of a number of shares of Stock having a fair market value (as
determined in accordance with Section 7(b) hereof) equal to the aggregate
purchase price of the Stock being purchased (“Cashless Exercise”) as hereinafter
determined, or (iii) a combination of cash and shares, or (iv) on a “net”
cashless exercise basis. If the Optionee elects the net cashless exercise method
of payment, the Company shall issue to the Optionee a number of shares of Stock
determined in accordance with the following formula:
X = Y(A - B)
A
| with: |
X
=
|
the
number of shares of Stock to be issued to the
Holder;
|
|
|
Y
=
|
the
number of shares of Stock with respect to which the Option is being
exercised;
|
|
|
A
=
|
the
Fair Market Value per share of the Stock on the date of exercise of the
Option; and
|
|
|
B
=
|
the
then-current exercise price of the
Option
|
8. Termination or Amendment of
Plan.
(a) The
Board may amend, suspend, or terminate the Plan, except that no amendment shall
be made that would impair the rights of any Optionee under any Option
theretofore granted without such Optionee’s consent.
(b) The
Board may amend the terms of any Option theretofore granted, prospectively or
retroactively, but no such amendment shall impair the rights of any Optionee
without the Optionee’s consent.
(c) It
is the intention of the Board that the Plan comply strictly with the provisions
of Section 409A of the Code and Treasury Regulations and other Internal Revenue
Service guidance promulgated thereunder (the “Section 409A Rules”) and the Board
shall exercise its discretion in granting Options hereunder (and the terms of
such Options) accordingly. The Plan and any grant of an Option
hereunder may be amended from time to time (without, in the case of an Option,
the consent of the Optionee) as may be necessary or appropriate to comply with
the Section 409A Rules.
9. Effect of Change in Stock Subject to
Plan.
Appropriate
adjustments shall be made in the number and class of shares of Stock subject to
the Plan, the number of shares to be granted under the Plan and to any
outstanding Options and in the Option exercise price of any outstanding Options
in the event of a stock dividend, stock split, recapitalization, reverse stock
split, combination, reclassification or like change in the capital structure of
the Company.
5
10. Transferability of
Options.
(a) Except
as provided in Section 10(b) hereof, an Option may be exercised during the
lifetime of the Optionee only by the Optionee or the Optionee’s guardian or
legal representative and may not be assigned or transferred in any manner except
by will or by the laws of descent and distribution; provided, however, that Options
may be transferred under a qualified domestic relations order (as defined in the
Code or Title I of the Employee Retirement Income Security Act, or the rules
promulgated thereunder).
(b) Notwithstanding
the foregoing, with the consent of the Board, in its sole discretion, an
Optionee may transfer all or a portion of the Option to: (i) an Immediate Family
Member (as hereinafter defined), (ii) a trust for the exclusive benefit of the
Optionee and/or one or more Immediate Family Members, or (iii) such other person
or entity as the Board may permit (individually, a “Permitted
Transferee”). For purposes of this Section 10(b), “Immediate Family
Members” shall mean the Optionee’s spouse, parents, siblings, children or
grandchildren, whether natural or adopted. As a condition to such
transfer, each Permitted Transferee to whom the Option or any interest therein
is transferred shall agree in writing (in a form satisfactory to the Company) to
be bound by all of the terms and conditions of the Option Agreement evidencing
such Option and any additional restrictions or conditions as the Company may
require. Following the transfer of an Option, the term “Optionee”
shall refer to the Permitted Transferee, except that, with respect to any
provision for the Company’s tax withholding obligations, if any, such term shall
refer to the original Optionee. The Company shall have no obligation
to notify a Permitted Transferee of any termination of the transferred Option,
including an early termination pursuant to Section 7(d) hereof. A
Permitted Transferee shall be prohibited from making a subsequent transfer of a
transferred Option except to the original Optionee or to another Permitted
Transferee or as provided in Section 10(a) hereof.
11. Government
Regulations.
It is the
Company’s intent that the Plan comply in all respects with Rule 16b-3 of the
Exchange Act and any regulations promulgated thereunder. If any
provision of this Plan is later found not to be in compliance with such Rule,
the provision shall be deemed null and void. All grants and exercises
of Options under this Plan shall be executed in accordance with the requirements
of Section 16 of the Exchange Act and any regulations promulgated
thereunder.
12. General
Provisions.
(a) Certificates. All
certificates for shares of Stock delivered under the Plan shall be subject to
such stop transfer orders and other restrictions as the Board may deem advisable
under the rules, regulations and other requirements of the Securities and
Exchange Commission, any applicable Federal or state securities law, any stock
exchange or interdealer quotation system upon which the Stock is then listed or
traded and the Board may cause a legend or legends to be placed on any such
certificates to make appropriate reference to such restrictions.
(b) Director
Status. The adoption of the Plan shall not confer upon any
Optionee of the Company or any subsidiary any right to continued service as a
director with the Company, nor shall it interfere in any way with the right of
the Company to terminate the service of any of its directors at any
time.
6
(c) Limitation of
Liability. No member of the Board, or any officer or employee
of the Company acting on behalf of the Board, shall be personally liable for any
action, determination or interpretation taken or made in good faith with respect
to the Plan, and all members of the Board and each and any officer or employee
of the Company acting on their behalf shall, to the extent permitted by law, be
fully indemnified and protected by the Company in respect of any such action,
determination or interpretation.
13. Registration of
Stock.
Notwithstanding
any other provision in the Plan, no Option may be exercised unless and until the
Stock to be issued upon the exercise thereof has been registered under the
Securities Act and applicable state securities laws or is exempt from such
registration. The Company shall not be under any obligation to
register under applicable federal or state securities laws any Stock to be
issued upon the exercise of an Option granted hereunder in order to permit the
exercise of an Option and the issuance and sale of the Stock subject to such
Option.
14. Effective Date of
Plan.
The Plan
shall be effective on the date that the stockholders of the Company approve the
Plan, which approval shall be obtained prior to February 27, 2009 (the date of
actual approval being the “Effective Date”) which is one year from the date of
the authorization of the Plan by the company’s Board of Directors.
15. Governing Law.
The
validity, construction, and effect of the Plan and any rules and regulations
relating to the Plan shall be determined in accordance with the internal laws of
the State of Delaware, without giving effect to principles of conflicts of laws,
and applicable federal law.
7