Exhibit 10.1

 

EXECUTIVE EMPLOYMENT AGREEMENT

 

This EXECUTIVE EMPLOYMENT AGREEMENT (“Agreement”) is made and entered into as of
the 15th day of May, 2017, by and between Towerstream Corporation, a Delaware
corporation (the “Company”) and Laura Thomas, an individual (“Executive”).

 

W I T N E S S E T H:

 

WHEREAS, the Executive desires to be employed by the Company as its Chief
Financial Officer and the Company wishes to employ the Executive in such
capacity, commencing on and as of May 15, 2017 (the “Effective Date”).

 

NOW, THEREFORE, in consideration of the foregoing and their respective covenants
and agreements contained in this document, the Company and the Executive hereby
agree as follows:

 

1. Employment and Duties. The Company agrees to employ and the Executive agrees
to serve as the Company’s Chief Financial Officer. The duties and
responsibilities of the Executive shall include the duties and responsibilities
as the Company’s Board of Directors (“Board”) or Chief Executive Officer may
from time to time assign to the Executive and reasonably commensurate with those
duties and responsibilities normally associated with and appropriate for someone
in the position of Chief Financial Officer.

 

The Executive shall devote her full time efforts and services to the business
and affairs of the Company and its subsidiaries. Nothing in this Section 1 shall
prohibit the Executive from: (A) serving as a director or member of any other
board, committee thereof of any other entity or organization, (B) delivering
lectures, fulfilling speaking engagements, and any writing or publication
relating to her area of expertise, (C) serving as a director or trustee of any
governmental, charitable or educational organization or (D) engaging in
additional activities in connection with personal investments and community
affairs, including, without limitation, professional or charitable or similar
organization committees, boards, memberships or similar associations or
affiliations, provided, however, such activities are not in competition with the
business and affairs of the Company or would tend to cast executive of Company
in a negative light in the reasonable judgment of the Board.

  

2. Term. The term of this Agreement shall commence on the Effective Date and
shall continue for a period of two (2) years following the Effective Date and
shall be automatically renewed for successive one (1) year periods thereafter
unless either party provides the other party with written notice of her or its
intention not to renew this Agreement at least one (1) month prior to the
expiration of the initial term or any renewal term of this Agreement.
“Employment Period” shall mean the initial two (2) year term plus renewals, if
any.

 

3. Place of Employment. The Executive’s services shall be performed at the
Company’s principal executive offices, currently located at 88 Silva Lane,
Middletown, Rhode Island, provided that the Executive may be required to travel
on Company business during the Employment Period.

 

4. Base Salary and Board Fees. The Company agrees to pay the Executive a base
salary (“Base Salary”) of $240,000.00 per annum for the position of Chief
Financial Officer. Annual adjustments after the first year of the Employment
Period shall be determined by the Board. The Base Salary shall be paid in
periodic installments in accordance with the Company’s regular payroll
practices.

 

5. Incentive Compensation and Bonuses.

 

(a) Annual Bonus: For each fiscal year during the term of employment, the
Executive shall be eligible to receive a cash bonus (the “Annual Bonus”) in the
amount of up to 50% of the Base Salary for such year, as may be determined from
time to time by the Board in its discretion. The Annual Bonus shall be paid by
the Company to the Executive promptly after determination that the relevant
targets, if any, have been met, it being understood that the attainment of any
financial targets associated with any bonus shall not be determined until
following the completion of the Company’s annual audit and public announcement
of such results and shall be paid promptly following the Company’s announcement
of earnings. For the period beginning on the Effective Date and ending on the
last day of the applicable fiscal year, the Executive shall be eligible to
receive a prorated Annual Bonus (calculated as the Annual Bonus that would have
been paid for the entire fiscal year multiplied by a fraction the numerator of
which is equal to the number of days the Executive worked in the applicable
fiscal year and the denominator of which is equal to the total number of days in
such year). In the event that the Compensation Committee is unable to act or if
there shall be no such Compensation Committee, then all references herein to the
Compensation Committee (except in the proviso to this sentence) shall be deemed
to be references to the Board. Upon her termination from employment, the
Executive shall be entitled to receive a pro-rata portion of the Annual Bonus
calculated based upon her final day of employment, regardless of whether she is
employed by the Company through the conclusion of the fiscal quarter or year, as
the case may be, on which the Annual Bonus is based.

  

 
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(b) Equity Awards and Incentive Compensation: In consideration of the Executive
entering into this Agreement and as an inducement to join the Company, on the
Effective Date, the Company will grant the Executive options to purchase common
stock equal to up to 2% of the common stock outstanding on the Effective Date on
a fully diluted basis, 25% of which will vest after one (1) year’s service and
the remaining to vest ratably over the three (3) following years (the
“Options”). All other terms and conditions of such awards shall be governed by
the terms and conditions of the applicable equity plan and award agreements, if
any. During the term of employment, the Executive shall be eligible to
participate in any equity-based incentive compensation plan or program adopted
by the Company (such awards under such plan or program, the “Share Awards”) as
the Compensation Committee or Board may from time to time determine. Share
Awards shall be subject to applicable plan terms and conditions and any
additional terms and conditions as determined by the Compensation Committee or
the Board. The attainment of any financial targets associated with any Share
Awards shall not be determined until following the completion of the Company’s
annual audit and public announcement of such results and shall be paid promptly
following the Company’s announcement of earnings. All Share Awards not earned
and vested on the date of termination shall be forfeited. 

 

6. Severance Compensation:

 

(a)     Upon termination of employment for any reason, the Executive shall be
entitled to: (A) all Base Salary earned through the date of termination to be
paid according to Section 4, (B) any Annual Bonuses earned through the date of
termination to be paid according to Section 5(a), (C) any and all reasonable
expenses paid or incurred by the Executive in connection with and related to the
performance of her duties and responsibilities for the Company during the period
ending on the termination date to be paid according to Section 8, (D) any
accrued but unused vacation time through the termination date in accordance with
Company policy, and (E) all Share Awards and Options earned and vested prior to
the date of termination (collectively, the “Separation Payment”); provided, that
the Executive executes an agreement releasing Company and its affiliates from
any liability associated with this Agreement and such release is irrevocable at
the time the Separation Payment is first payable under this Section 6(a) and the
Executive complies with her other obligations under Sections 12 and 13 of this
Agreement.

 

(b)     In the event of a termination by the Company other than for Cause or by
the Executive for Good Reason, each within one hundred eighty days (180) days of
the occurrence of a Change of Control (as defined below), and subject to the
additional provisions of Section 11(d)(3), then in addition to the severance
compensation set forth in Section 6(a), Executive shall also be entitled to the
following enhanced separation benefits (“Enhanced Separation Benefits”): (i) the
greater of Executive’s continued Base Salary through the balance of the
Employment Period, as renewed, or twelve (12) months of Executive’s then Base
Salary; (ii) continued participation in Company welfare benefit plans (including
health benefits) on the same terms as immediately prior to termination and to be
paid in full by the Company for the period of time set forth in this Section
6(b) (not to be less than twelve (12) months of continuation of benefits) and
(iii) immediate vesting of all stock options/equity awards; provided, that the
Executive executes an agreement releasing Company and its affiliates from any
liability associated with this Agreement and such release is irrevocable at the
time any of the Enhanced Separation Benefits are first payable under this
Section 6(b) and the Executive complies with her other obligations under
Sections 12 and 13 of this Agreement.

 

 
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   (c)     Upon termination of Executive’s continued benefits (either pursuant
to Section 6(a) or 6(b) as the case may be), the Executive may continue coverage
with respect to the Company’s group health plans as permitted by the
Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”) for herself and
each of her “Qualified Beneficiaries” as defined by COBRA (“COBRA Coverage”).
  The Company shall reimburse the amount of any COBRA premium paid for COBRA
Coverage timely elected by and for the Executive and any Qualified Beneficiary
of the Executive, and not otherwise reimbursed, during the period that ends on
the earliest of (x) the date the Executive or the Qualified Beneficiary, as the
case may be, ceases to be eligible for COBRA Coverage, (y) the last day of the
consecutive eighteen (18) month period following the date of the Executive’s
termination of employment and (z) the date the Executive or the Qualified
Beneficiary, as the case may be, is covered by another group health plan.  To
reimburse any COBRA premium payment under this paragraph, the Company must
receive documentation of the COBRA premium payment within ninety (90) days of
its payment.

 

7. Clawback Rights. The Annual Bonus, and any and all stock based compensation
(such as options and equity awards) (collectively, the “Clawback Benefits”)
shall be subject to “Clawback Rights” as follows: during the period that the
Executive is employed by the Company and upon the termination of the Executive’s
employment and for a period of three (3) years thereafter, if there is a
restatement of any financial results from which any Clawback Benefits to the
Executive shall have been determined, the Executive agrees to repay any amounts
which were determined by reference to any Company financial results which were
later restated (as defined below), to the extent the Clawback Benefits amounts
paid exceed the Clawback Benefits amounts that would have been paid, based on
the restatement of the Company’s financial information. All Clawback Benefits
amounts resulting from such restated financial results shall be retroactively
adjusted by the Compensation Committee to take into account the restated
results, and any excess portion of the Clawback Benefits resulting from such
restated results shall be immediately surrendered to the Company and if not so
surrendered within ninety (90) days of the revised calculation being provided to
the Executive by the Compensation Committee following a publicly announced
restatement, the Company shall have the right to take any and all action to
effectuate such adjustment. The calculation of the revised Clawback Benefits
amount shall be determined by the Compensation Committee in good faith and in
accordance with applicable law, rules and regulations. All determinations by the
Compensation Committee with respect to the Clawback Rights shall be final and
binding on the Company and the Executive. The Clawback Rights shall terminate
following a Change of Control, subject to applicable law, rules and regulations.
For purposes of this Section 7, a restatement of financial results that requires
a repayment of a portion of the Clawback Benefits amounts shall mean a
restatement resulting from material non-compliance of the Company with any
financial reporting requirement under the federal securities laws and shall not
include a restatement of financial results resulting from subsequent changes in
accounting pronouncements or requirements which were not in effect on the date
the financial statements were originally prepared (“Restatements”). The parties
acknowledge it is their intention that the foregoing Clawback Rights as relates
to Restatements conform in all respects to the provisions of the Dodd-Frank Wall
Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank Act”) and require
recovery of all “incentive-based” compensation, pursuant to the provisions of
the Dodd-Frank Act and any and all rules and regulations promulgated thereunder
from time to time in effect. Accordingly, the terms and provisions of this
Agreement shall be deemed automatically amended from time to time to assure
compliance with the Dodd-Frank Act and such rules and regulations as hereafter
may be adopted and in effect.

 

8. Expenses. The Executive shall be entitled to prompt reimbursement by the
Company for all reasonable ordinary and necessary travel, entertainment, and
other expenses incurred by the Executive while employed (in accordance with the
policies and procedures established by the Company for its senior executive
officers) in the performance of her duties and responsibilities under this
Agreement; provided, that the Executive shall properly account for such expenses
in accordance with Company policies and procedures.

 

9. Other Benefits. During the term of this Agreement, the Executive shall be
eligible to participate in incentive, stock purchase, savings, retirement
(401(k)), and welfare benefit plans, including, without limitation, health,
medical, dental, vision, life (including accidental death and dismemberment) and
disability insurance plans (collectively, “Benefit Plans”), in substantially the
same manner and at substantially the same levels as the Company makes such
opportunities available to the Company’s managerial or salaried executive
employees and/or its senior executives.

 

The Company shall pay one hundred percent (100%) of the cost for any group
medical, vision and/or dental coverage elected by and for the Executive. 

 

10. Vacation. During the term of this Agreement, the Executive shall be entitled
to accrue, on a pro rata basis, thirty (30) paid vacation days per year.
Vacation shall be taken at such times as are mutually convenient to the
Executive and the Company and no more than fifteen (15) consecutive days shall
be taken at any one time without Company approval in advance.

 

 
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11. Termination of Employment:

 

(a) Death. If the Executive dies during the Employment Period, this Agreement
and the Executive’s employment with the Company shall automatically terminate
and the Company’s obligations to the Executive’s estate and to the Executive’s
Qualified Beneficiaries shall be those set forth in Section 6(a) regarding
severance compensation. 

 

(b) Disability. In the event that, during the term of this Agreement the
Executive shall be prevented from performing her essential functions hereunder
to the full extent required by the Company by reason of Disability (as defined
below), this Agreement and the Executive’s employment with the Company shall
automatically terminate. The Company’s obligation to the Executive under such
circumstances shall be those set forth in Section 6(a) and 6(c) regarding
severance compensation. For purposes of this Agreement, “Disability” shall mean
a physical or mental disability that prevents the performance by the Executive,
with or without reasonable accommodation, of her essential functions hereunder
for an aggregate of ninety (90) days or longer during any twelve (12)
consecutive months. The determination of the Executive’s Disability shall be
made by an independent physician who is reasonably acceptable to the Company and
the Executive (or her representative), be final and binding on the parties
hereto and be made taking into account such competent medical evidence as shall
be presented to such independent physician by the Executive and/or the Company
or by any physician or group of physicians or other competent medical experts
employed by the Executive and/or the Company to advise such independent
physician.

 

(c) Cause.

 

(1) At any time during the Employment Period, the Company may terminate this
Agreement and the Executive’s employment hereunder for Cause. For purposes of
this Agreement, “Cause” shall mean: (a) the willful and continued failure of the
Executive to perform substantially her duties and responsibilities for the
Company (other than any such failure resulting from the Executive’s death or
Disability) after a written demand by the Board for substantial performance is
delivered to the Executive by the Company, which specifically identifies the
manner in which the Board believes that the Executive has not substantially
performed her duties and responsibilities, which willful and continued failure
is not cured by the Executive within thirty (30) days following her receipt of
such written demand; (b) the conviction of, or plea of guilty or nolo contendere
to, a felony, or (c) fraud, dishonesty or gross misconduct which is materially
and demonstratively injurious to the Company. Termination under clauses (b) or
(c) of this Section 11(c)(1) shall not be subject to cure.

  

(2) For purposes of this Section 11(c), no act, or failure to act, on the part
of the Executive shall be considered “willful” unless done, or omitted to be
done, by her in bad faith and without reasonable belief that her action or
omission was in, or not opposed to, the best interest of the Company. Between
the time the Executive receives written demand regarding substantial
performance, as set forth in subparagraph (1) above, and prior to an actual
termination for Cause, the Executive will be entitled to appear (with counsel)
before the full Board to present information regarding her views on the Cause
event. Under no circumstances shall Executive be terminated under Section
11(c)(1)(a) before the expiration of the 30 day cure period. After such hearing,
termination for Cause must be approved by a majority vote of the full Board
(other than the Executive). For terminations pursuant to Sections 11(c)(1)(b)
and (c), the Board may suspend the Executive with full pay and benefits until a
final determination by the full Board has been made.

 

(3) Upon termination of this Agreement for Cause, the Company shall have no
further obligations or liability to the Executive or her heirs, administrators
or executors with respect to compensation and benefits thereafter, except for
the obligation to pay the severance compensation set forth in Section 6(a) and
6(c). The Company shall deduct, from all payments made hereunder, all applicable
taxes, including income tax, FICA and FUTA, and other appropriate deductions.

 

 
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(d) For Good Reason or Without Cause.

 

(1) At any time during the term of this Agreement and subject to the conditions
set forth in Section 11(d)(2) below, the Executive may terminate this Agreement
and the Executive’s employment with the Company for “Good Reason”.  For purposes
of this Agreement, “Good Reason” shall mean the occurrence of any of the
following events without Executive’s consent: (A) the assignment to the
Executive of duties that are significantly different from, and/or that result in
a substantial diminution of, the duties that she assumed on the Effective Date
(including reporting to anyone other than solely and directly to the Board and
Chief Executive Officer); (B) the assignment to the Executive of a title that is
different from and subordinate to the title Chief Financial Officer of the
Company, provided, however, for the absence of doubt following a Change of
Control, should the Executive be required to serve in a diminished capacity in a
division or unit of another entity (including the acquiring entity), such event
shall constitute Good Reason regardless of the title of the Executive in such
acquiring company, division or unit; or (C) material breach by the Company of
this Agreement.

  

(2) The Executive shall not be entitled to terminate this Agreement for Good
Reason unless and until she shall have delivered written notice to the Company
within ninety (90) days of the date upon which the facts giving rise to Good
Reason occurred of her intention to terminate this Agreement and her employment
with the Company for Good Reason, which notice specifies in reasonable detail
the circumstances claimed to provide the basis for such termination for Good
Reason, and the Company shall not have eliminated the circumstances constituting
Good Reason within thirty (30) days of its receipt from the Executive of such
written notice. In the event the Executive elects to terminate this Agreement
for Good Reason in accordance with Section 11(d)(1), such election must be made
within the twenty-four (24) months following the initial existence of one or
more of the conditions constituting Good Reason as provided in Section 11(d)(1).
Upon termination of this Agreement for Good Reason (absent a Change of Control
as addressed in Section 11(d)(3)), the Company shall have no further obligations
or liability to the Executive or her heirs, administrators or executors with
respect to compensation and benefits thereafter, except for the obligation to
pay the severance compensation set forth in Section 6(a) and 6(c). The Company
shall deduct, from all payments made hereunder, all applicable taxes, including
income tax, FICA and FUTA, and other appropriate deductions.

 

(3) In the event of a termination by the Company other than for Cause or the
Executive’s termination for Good Reason, each within one hundred eighty days
(180) days of the occurrence of a Change of Control, the Company shall pay or
provide to the Executive (or, following her death, to the Executive’s heirs,
administrators or executors) the Enhanced Separation Benefits set forth in
Sections 6(b) and 6(c).  Subject to the terms hereof, one-half (1/2) of the
compensation of the Enhanced Separation Benefits payment shall be paid within
thirty (30) days of the Executive’s termination of employment (“Initial
Payment”), and the balance of the compensation of the Enhanced Separation
Benefits shall be paid in substantially equal installments on the Company’s
regular payroll dates beginning with the first payroll date coincident with or
immediately following the Initial Payment and ending on the payroll date
coincident with or immediately following the twelve (12) month anniversary of
the Initial Payment. The Company shall deduct, from all payments made hereunder,
all applicable taxes, including income tax, FICA and FUTA, and other appropriate
deductions. In the event the Executive elects to terminate this Agreement for a
Good Reason following a Change of Control, such election must be made within one
hundred eighty (180) days of the occurrence of the Change of Control to obtain
the Enhanced Separation Benefits.

 

 (4)           The Executive shall not be required to mitigate the amount of any
payment provided for in this Section 11(d) by seeking other employment or
otherwise, nor shall the amount of any payment provided for in this Section
11(d) be reduced by any compensation earned by the Executive as the result of
employment by another employer or business or by profits earned by the Executive
from any other source at any time before and after the termination date. The
Company’s obligation to make any payment pursuant to, and otherwise to perform
its obligations under, this Agreement shall not be affected by any offset,
counterclaim or other right that the Company may have against the Executive for
any reason.

  

(e) Without “Good Reason” by the Executive. At any time during the term of this
Agreement, the Executive shall be entitled to terminate this Agreement and the
Executive’s employment with the Company without Good Reason by providing prior
written notice of at least thirty (30) days to the Company. Upon termination by
the Executive of this Agreement or the Executive’s employment with the Company
without Good Reason, the Company shall have no further obligations or liability
to the Executive or her heirs, administrators or executors with respect to
compensation and benefits thereafter, except for the obligations set forth in
Section 6(a) and 6(c). The Company shall deduct, from all payments made
hereunder, all applicable taxes, including income tax, FICA and FUTA, and other
appropriate deductions.

 

 
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(f) Change of Control. For purposes of this Agreement, “Change of Control” shall
mean the occurrence of any one or more of the following: (i) the accumulation
(if over time, in any consecutive twelve (12) month period), whether directly,
indirectly, beneficially or of record, by any individual, entity or group
(within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange
Act of 1934, as amended) of more than fifty percent (50%) or more of the shares
of the outstanding Common Stock of the Company, whether by merger,
consolidation, sale or other transfer of shares of Common Stock (other than a
merger or consolidation where the stockholders of the Company prior to the
merger or consolidation are the holders of a majority of the voting securities
of the entity that survives such merger or consolidation) for purposes of
clarity the Company expects to sell a number of shares and/or convert
outstanding senior debt to either preferred or common stock not limited to the
period of this contract to raise funds and stabilize its balance sheet and any
such sales shall not constitute a change of control for purposes of this section
or Agreement, (ii) a sale of all or substantially all of the assets of the
Company or (iii) during any period of twelve (12) consecutive months, the
individuals who, at the beginning of such period, constitute the Board, and any
new director whose election by the Board or nomination for election by the
Company’s stockholders was approved by a vote of at least two-thirds (2/3) of
the directors then still in office who either were directors at the beginning of
the twelve (12) month period or whose election or nomination for election was
previously so approved, cease for any reason to constitute at least a majority
of the Board; provided that the following shall not constitute a Change of
Control for the purposes of this Agreement: any action by the Company’s senior
lender, Melody Capital Partners, which would result in the senior lender, or its
successor, assuming control of the Board, the company’s assets or business.

  

(g) Failure to Renew. This Agreement may be terminated upon either party’s
failure to renew the Agreement in accordance with Section 2. Upon such
termination, the Company shall have no further obligations or liability to the
Executive or her heirs, administrators or executors with respect to compensation
and benefits thereafter, except for the obligations set forth in Section 6(a)
and 6(c).

 

(h) Any termination of the Executive’s employment by the Company or by the
Executive (other than termination by reason of the Executive’s death) shall be
communicated by written Notice of Termination to the other party of this
Agreement. For purposes of this Agreement, a “Notice of Termination” shall mean
a written notice which shall indicate the specific termination provision in this
Agreement relied upon and shall set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the Executive’s
employment under the provision so indicated, provided, however, failure to
provide timely notification shall not affect the employment status of the
Executive.

 

12. Confidential Information.

 

(a) The Executive recognizes, acknowledges and agrees that she has had and will
continue to have access to secret and confidential information regarding the
Company, its subsidiaries and their respective businesses (“Confidential
Information”), including but not limited to, its products, methods, formulas,
software code, patents, sources of supply, customer dealings, data, know-how,
trade secrets and business plans, provided such information is not in or does
not hereafter become part of the public domain, or become known to others
through no fault of the Executive.  The Executive acknowledges that such
information is of great value to the Company, is the sole property of the
Company, and has been and will be acquired by her in confidence.  In
consideration of the obligations undertaken by the Company herein, the Executive
will not, at any time, during or after her employment hereunder, reveal, divulge
or make known to any person, any information acquired by the Executive during
the course of her employment, which is treated as confidential by the Company,
and not otherwise in the public domain. The provisions of this Section 12 shall
survive the termination of the Executive’s employment hereunder.

 

(b) The Executive affirms that she does not possess and will not rely upon the
protected trade secrets or confidential or proprietary information of any prior
employer(s) in providing services to the Company or its
subsidiaries.                        

 

 
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(c) In the event that the Executive’s employment with the Company terminates for
any reason, the Executive shall deliver forthwith to the Company any and all
originals and copies, including those in electronic or digital formats, of
Confidential Information; provided, however, the Executive shall be entitled to
retain (i) papers and other materials of a personal nature, including, but not
limited to, photographs, correspondence, personal diaries, calendars and
rolodexes, personal files and phone books, (ii) information showing her
compensation or relating to reimbursement of expenses, (iii) information that
she reasonably believes may be needed for tax purposes and (iv) copies of plans,
programs and agreements relating to her employment, or termination thereof, with
the Company. The covenants and agreements in this Section 12 shall exclude
excludes information (A) which is in the public domain through no unauthorized
act or omission of Executive or (B) which becomes available to Executive on a
non-confidential basis from a source other than Company or its affiliates
without breach of such source’s confidentiality or non-disclosure obligations to
Company or any of its affiliates.

  

13. Non-Competition and Non-Solicitation.

 

(a) The Executive agrees and acknowledges that the Confidential Information that
the Executive has already received and will receive is valuable to the Company
and that its protection and maintenance constitutes a legitimate business
interest of the Company, to be protected by the non-competition restrictions set
forth herein. The Executive agrees and acknowledges that the non-competition
restrictions set forth herein are reasonable and necessary and do not impose
undue hardship or burdens on the Executive. The Executive also acknowledges that
the Company’s Business (as defined in Section 13(b) (1) below) is conducted
throughout the United States (the “Territory”), and that the Territory, scope of
prohibited competition, and time duration set forth in the non-competition
restrictions set forth below are reasonable and necessary to maintain the value
of the Confidential Information of, and to protect the goodwill and other
legitimate business interests of, the Company, its affiliates and/or its clients
or customers. The provisions of this Section 13 shall survive the termination of
the Executive’s employment hereunder for the time periods specified below.

 

(b) The Executive hereby agrees and covenants that she shall not without the
prior written consent of the Company, directly or indirectly, in any capacity
whatsoever, including, without limitation, as an employee, employer, consultant,
principal, partner, shareholder, officer, director or any other individual or
representative capacity (other than (i) as a holder of less than two (2%)
percent of the outstanding securities of a company whose shares are traded on
any national securities exchange or (ii) as a limited partner, passive minority
interest holder in a venture capital fund, private equity fund or similar
investment entity which holds or may hold an equity or debt position in
portfolio companies that are competitive with the Company; provided however,
that the Executive shall be precluded from serving as an operating partner,
general partner, manager or governing board designee with respect to such
portfolio companies), or whether on the Executive's own behalf or on behalf of
any other person or entity or otherwise howsoever, during the Term and
thereafter to the extent described below, within the Territory:

 

(1) Engage, own, manage, operate, control, be employed by, consult for,
participate in, or be connected in any manner with the ownership, management,
operation or control of any business in competition with the Business of the
Company, as defined in the next sentence. For purposes hereof, the Company’s
“Business” shall mean the provision of fixed wireless services to businesses.

 

(2) Recruit, solicit or hire, or attempt to recruit, solicit or hire, any
employee, or independent contractor of the Company to leave the employment (or
independent contractor relationship) thereof, whether or not any such employee
or independent contractor is party to an employment agreement, for the purpose
of competing with the Business of the Company;

  

(3) Attempt in any manner to solicit or accept from any customer of the Company,
with whom Executive had significant contact during Executive’s employment by the
Company (whether under this Agreement or otherwise), business of the kind or
competitive with the business done by the Company with such customer or to
persuade or attempt to persuade any such customer to cease to do business or to
reduce the amount of business which such customer has customarily done or might
do with the Company, or if any such customer elects to move its business to a
person other than the Company, provide any services of the kind or competitive
with the business of the Company for such customer, or have any discussions
regarding any such service with such customer, on behalf of such other person
for the purpose of competing with the Business of the Company; or

 

(4) Interfere with any relationship, contractual or otherwise, between the
Company and any other party, including, without limitation, any supplier,
distributor, co-venturer or joint venturer of the Company, for the purpose of
soliciting such other party to discontinue or reduce its business with the
Company for the purpose of competing with the Business of the Company.

 

 
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With respect to the activities described in Paragraphs (1), (2), (3) and (4)
above, the restrictions of this Section 13(b) shall continue during the Term of
this Agreement and for a period of one (1) year thereafter.

 

14. Section 409A.

 

The provisions of this Agreement are intended to comply with or are exempt from
Section 409A of the Code (“Section 409A”) and the related Treasury Regulations
and shall be construed in a manner consistent with the requirements for avoiding
taxes or penalties under Section 409A. The Company and the Executive agree to
work together in good faith to consider amendments to this Agreement and to take
such reasonable actions necessary, appropriate or desirable to avoid imposition
of any additional tax under Section 409A or income recognition prior to actual
payment to the Executive under this Agreement.

 

It is intended that any expense reimbursement made under this Agreement shall be
exempt from Section 409A. Notwithstanding the foregoing, if any expense
reimbursement made under this Agreement shall be determined to be “deferred
compensation” subject to Section 409A (“Deferred Compensation”), then (a) the
right to reimbursement or in-kind benefits is not subject to liquidation or
exchange for another benefit, (b) the amount of expenses eligible for
reimbursement, or in-kind benefits, provided during any taxable year shall not
affect the expenses eligible for reimbursement, or in-kind benefits to be
provided, in any other taxable year (provided that this clause (b) shall not be
violated with regard to expenses reimbursed under any arrangement covered by
Section 105(b) of the Code solely because such expenses are subject to a limit
related to the period the arrangement is in effect) and (c) such payments shall
be made on or before the last day of the taxable year following the taxable year
in which the expense was incurred.

  

With respect to the time of payments of any amount under this Agreement that is
Deferred Compensation, references in the Agreement to “termination of
employment” and substantially similar phrases, including a termination of
employment due to the Executive’s Disability, shall mean “Separation from
Service” from the Company within the meaning of Section 409A (determined after
applying the presumptions set forth in Treasury Regulation Section
1.409A-1(h)(1)). Each installment payable hereunder shall constitute a separate
payment for purposes of Treasury Regulation Section 1.409A-2(b), including
Treasury Regulation Section 1.409A-2(b)(2)(iii). Each payment that is made
within the terms of the “short-term deferral” rule set forth in Treasury
Regulation Section 1.409A-1(b)(4) is intended to meet the “short-term deferral”
rule. Each other payment is intended to be a payment upon an involuntary
termination from service and payable pursuant to Treasury Regulation Section
1.409A-1(b)(9)(iii), et. seq., to the maximum extent permitted by that
regulation, with any amount that is not exempt from Code Section 409A being
subject to Code Section 409A.

  

Notwithstanding anything to the contrary in this Agreement, if the Executive is
a “specified employee” within the meaning of Section 409A at the time of the
Executive’s termination, then only that portion of the severance and benefits
payable to the Executive pursuant to this Agreement, if any, and any other
severance payments or separation benefits which may be considered Deferred
Compensation (together, the “Deferred Separation Benefits”), which (when
considered together) do not exceed the Section 409A Limit (as defined herein)
may be made within the first six (6) months following the Executive’s
termination of employment in accordance with the payment schedule applicable to
each payment or benefit. Any portion of the Deferred Separation Benefits in
excess of the Section 409A Limit otherwise due to the Executive on or within the
six (6) month period following the Executive’s termination will accrue during
such six (6) month period and will become payable in one lump sum cash payment
on the date six (6) months and one (1) day following the date of the Executive’s
termination of employment. All subsequent Deferred Separation Benefits, if any,
will be payable in accordance with the payment schedule applicable to each
payment or benefit. Notwithstanding anything herein to the contrary, if the
Executive dies following termination but prior to the six (6) month anniversary
of the Executive’s termination date, then any payments delayed in accordance
with this paragraph will be payable in a lump sum as soon as administratively
practicable after the date of the Executive’s death and all other Deferred
Separation Benefits will be payable in accordance with the payment schedule
applicable to each payment or benefit.

 

 
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For purposes of this Agreement, “Section 409A Limit” shall mean a sum equal to
(x) the amounts payable within the terms of the “short-term deferral” rule under
Treasury Regulation Section 1.409A-1(b)(4) plus (y) the amount payable as
“separation pay due to involuntary separation from service” under Treasury
Regulation Section 1.409A-1(b)(9)(iii) equal to the lesser of two (2) times: (i)
the Executive’s annualized compensation from the Company based upon her annual
rate of pay during the Executive’s taxable year preceding her taxable year when
her employment terminated, as determined under Treasury Regulation
1.409A-1(b)(9)(iii)(A)(1); and (ii) the maximum amount that may be taken into
account under a qualified plan pursuant to Section 401(a)(17) of the Code for
the year in which the Executive’s employment is terminated.

 

15. Miscellaneous.

 

(a) Neither the Executive nor the Company may assign or delegate any of their
rights or duties under this Agreement without the express written consent of the
other; provided, however, that the Company shall have the right to delegate its
obligation of payment of all sums due to the Executive hereunder, provided that
such delegation shall not relieve the Company of any of its obligations
hereunder.

 

(b) During the term of this Agreement, the Company (i) shall indemnify and hold
harmless the Executive and her heirs and representatives to the maximum extent
provided by the laws of the State of Delaware and by Company’s bylaws and (ii)
shall cover the Executive under the Company’s directors’ and officers’ liability
insurance on the same basis as it covers other senior executive officers and
directors of the Company.

 

(c) This Agreement constitutes and embodies the full and complete understanding
and agreement of the parties with respect to the Executive’s employment by the
Company, supersedes all prior understandings and agreements, whether oral or
written, between the Executive and the Company, and shall not be amended,
modified or changed except by an instrument in writing executed by the party to
be charged. If any provision of this Agreement, or the application thereof,
shall for any reason and to any extent be invalid or unenforceable, then the
remainder of this Agreement and the application of such provision to other
persons or circumstances shall be interpreted so as reasonably to effect the
intent of the parties hereto.  The parties further agree to replace such void or
unenforceable provision of this Agreement with a valid and enforceable provision
that shall achieve, to the extent possible, the economic, business and other
purposes of the void or unenforceable provision. No waiver by either party of
any provision or condition to be performed shall be deemed a waiver of similar
or dissimilar provisions or conditions at the same time or any prior or
subsequent time.

  

(d) This Agreement shall inure to the benefit of, be binding upon and
enforceable against, the parties hereto and their respective successors, heirs,
beneficiaries and permitted assigns.

 

(e) The headings contained in this Agreement are for convenience of reference
only and shall not affect in any way the meaning or interpretation of this
Agreement.

 

(f) All notices, requests, demands and other communications required or
permitted to be given hereunder shall be in writing and shall be deemed to have
been duly given when personally delivered, sent by registered or certified mail,
return receipt requested, postage prepaid, or by reputable national overnight
delivery service (e.g., Federal Express) for overnight delivery to the party at
the address set forth in the preamble to this Agreement, or to such other
address as either party may hereafter give the other party notice of in
accordance with the provisions hereof. Notices shall be deemed given on the
sooner of the date actually received or the third business day after deposited
in the mail or one business day after deposited with an overnight delivery
service for overnight delivery.

 

(g) This Agreement shall be governed by and construed in accordance with the
internal laws of the State of New York, and each of the parties hereto
irrevocably consents to the jurisdiction and venue of the federal and state
courts located in the State of New York, County of New York, for any disputes
arising out of this Agreement, or the Executive’s employment with the Company.
The prevailing party in any dispute arising out of this Agreement shall be
entitled to her or its reasonable attorney’s fees and costs.

 

(h) This Agreement may be executed simultaneously in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one of the same instrument. The parties hereto have executed this
Agreement as of the date set forth above.

 

 
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(i) The Executive represents and warrants to the Company, that she has the full
power and authority to enter into this Agreement and to perform her obligations
hereunder and that the execution and delivery of this Agreement and the
performance of her obligations hereunder will not conflict with any agreement to
which the Executive is a party.

 

(j) The Company represents and warrants to the Executive that it has the full
power and authority to enter into this Agreement and to perform its obligations
hereunder and that the execution and delivery of this Agreement and the
performance of its obligations hereunder will not conflict with any agreement to
which the Company is a party.

 

[Signature page follows immediately]

 

 
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IN WITNESS WHEREOF, the Executive and the Company have caused this Executive
Employment Agreement to be executed as of the date first above written.

 

 

TOWERSTREAM CORPORATION  

 

 

 

 

By: 

/s/ Ernest Ortega

 

Name:

Ernest Ortega

 

Title: 

Chief Executive Officer

 

Date Signed:

May 15, 2017

 

 

 

 

EXECUTIVE

 

 

 

 

 

By:

/s/ Laura Thomas

 

Name:

Laura Thomas

 

Date Signed:

May 15, 2017

 

 

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