Exhibit 99
CENTENNIAL COMMUNICATIONS CORP.
AND ITS SUBSIDIARIES
EMPLOYEE STOCK PURCHASE PLAN
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CENTENNIAL COMMUNICATIONS CORP. AND ITS SUBSIDIARIES
EMPLOYEE STOCK PURCHASE PLAN
1. PURPOSE
The purpose of the Centennial Communications Corp. and its Subsidiaries Employee
Stock Purchase Plan (the "Plan") is to enable Eligible Employees of Centennial
Communications Corp. (the "Company") and its Subsidiaries to acquire proprietary
interests in the Company through the ownership of common stock in the Company.
The Company believes that employees who participate in the Plan will have a
closer identification with the Company by virtue of their ability as
stockholders to participate in the Company's growth and earnings. It is the
intention of the Company to have the Plan qualify as an "an employee stock
purchase plan" under Section 423 of the Internal Revenue Code of 1986, as
amended (the "Code"). Accordingly, the provisions of the Plan shall be construed
so as to extend and limit participation in a manner consistent with the
requirements of that section of the Code.
2. DEFINITIONS
The following terms have the following meanings:
(a) "Annual Pay" shall mean an amount equal to the annual basic rate of pay of
an Eligible Employee as determined from the payroll records of the Company
or a Subsidiary on the effective date of an offer of stock made pursuant to
the Plan.
(b) "Average Market Price" shall mean the average of the high and low prices
for the Company's Common Stock in the over-the-counter market, as reported
by the National Association of Securities Dealers Automated Quotation
System (NASDAQ) (or other quotation service). If the Company's Common Stock
is not regularly traded in the over-the-counter market, but is registered
on a national securities exchange, "Average Market Price" shall mean the
closing price of the Company's Common Stock on such national securities
exchange.
(c) "Board of Directors" shall mean the board of directors of the Company.
(d) "Common Stock" shall mean shares of the $.01 par value Class A common stock
of the Company.
(e) "Eligible Employee" shall mean a person regularly employed by the Company
or a Subsidiary on the effective date of any offering of any stock pursuant
to the Plan, provided, however, that no person shall be considered an
Eligible Employee unless he/she is customarily employed by the Company or a
Subsidiary for more than twenty hours per week and more than five months in
a calendar year, and provided further, that the Board of Directors may
exclude the employees of any specified Subsidiary from any offering under
the Plan.
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(f) "Option" shall mean the right granted to Eligible Employees to purchase the
Common Stock under an offering made under the Plan.
(g) "Purchase Period" shall mean the number of calendar months during which
installment payments for stock purchased under the Plan shall be made.
(h) "Subscription Period" shall mean that period of time prescribed in any
offer of stock under the Plan beginning on the first day employees may
elect to purchase shares and ending on the last day such elections are
authorized to be received and accepted.
(i) "Subsidiary" shall mean any corporation (other than corporations organized
outside of the United States and Puerto Rico) which is or would be a
"subsidiary corporation" of the Company as the term defined in Section 424
of the Code.
3. SHARES RESERVED FOR PLAN ADJUSTMENTS
The shares of the Company's Common Stock to be sold to Eligible Employees under
the Plan may, at the election of the Company, be either treasury shares or
shares originally issued for such purpose. The maximum number of shares of
Common Stock which shall be reserved and made available for sale under the Plan
shall be 600,000, provided however, that the maximum number of shares that are
available in any one purchase period is 200,000, subject to adjustment as
determined by the Compensation Committee.
In the event of a subdivision or combination of the Company's shares (including
a stock split), the maximum number of shares which may thereafter be issued and
sold under the Plan and the number of shares under elections to purchase at the
time of such subdivision or combination will be proportionately increased or
decreased, the terms relating to the price at which shares under elections to
purchase will be sold will be appropriately adjusted, and such other action will
be taken as in the opinion of the Board of Directors is appropriate under the
circumstances. In case of a reclassification or other change in the Company's
shares, the Board of Directors also will make appropriate adjustments.
4. ADMINISTRATION OF THE PLAN
The Plan shall be administered by the Compensation Committee of the Board of
Directors. No director of the Company serving as a member of the Committee shall
be eligible, at any time while serving as a member of the Committee, to be
granted Options under the Plan. The Committee shall be vested with full
authority to make, administer and interpret such rules and regulations regarding
the Plan or to make amendments to the Plan itself as it may deem advisable
(including in the case of a change in control of the Company); provided,
however, that no such amendment shall increase the maximum number of shares
available for sale under the Plan, otherwise than as requested to reflect a
subdivision or a combination as provided in Article 3 hereof, nor shall any such
amendment act to expand the persons eligible to participate in the Plan beyond
the employees of the Company and its Subsidiaries. Any determination, decision,
or action of the Committee in connection with the construction, interpretation,
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administration, or application of the Plan shall be binding upon all Eligible
Employees and all persons claiming under an Eligible Employee.
5. PARTICIPATION IN THE PLAN AND ITS EFFECT ON EMPLOYMENT RELATIONSHIP
Options to purchase Common Stock under the Plan shall be granted only to
Eligible Employees. Options to purchase shares shall be granted to all Eligible
Employees of the Company or any of its Subsidiaries whose Eligible Employees are
granted such rights; provided, however, that in no event may an employee be
granted an option under this Plan if such employee, immediately after the option
is granted, owns stock possessing 5% or more of the total combined voting power
or value of all classes of capital stock of the Company or its Subsidiaries. For
the purposes of determining stock ownership under this paragraph, the rules of
Section 424 (d) of the Code shall apply, and stock which the employee may
purchase under all outstanding options shall be treated as stock owned by the
employee.
Neither the Plan nor any Option held by any Eligible Employee hereunder shall be
construed as conferring upon such Eligible Employee any right to continue in the
employ of the Company or any Subsidiary, or limit in any respect the right of
the Company or any Subsidiary to terminate such Eligible Employee's employment
or other relationship with the Company or any Subsidiary, as the case may be, at
any time.
6. PURCHASE PRICE
The purchase price for shares of Common Stock purchased pursuant to the Plan
(except as otherwise provided herein) will be 85 percent of the lesser of (1)
the Average Market Price of the Company's common stock on the first day of the
Purchase Period or (2) the Average Market Price of the Company's common stock on
the last day of the Purchase Period. If no Average Market Price is available on
either or both of these days, the purchase price shall be established based upon
85% of the Average Market Price on the last day prior thereto on which an
Average Market Price was available.
7. METHOD OF PAYMENT
Payment for shares purchased pursuant to the Plan shall be made in installments
through payroll deductions, with no right of prepayment. Each Eligible Employee
electing to purchase shares will authorize the Company to withhold a designated
amount from his regular weekly, biweekly, semi-monthly, or monthly pay for each
payroll period during the Purchase Period. All such payroll deductions made for
an Eligible Employee shall be credited to his/her account under the Plan. At the
end of the Purchase Period, each Eligible Employee shall receive in cash,
without interest, the balance remaining in his/her account, if any, after the
amount in his/her account has been applied to the purchase of whole shares at
the applicable purchase price. Only whole shares of Common Stock may be
purchased under the Plan.
8. EMPLOYEE'S ELECTION TO PURCHASE-GRANT OF OPTIONS
In order to participate in the Plan, an Eligible Employee must sign an election
to purchase shares on a form provided by the Company stating that the Eligible
Employee desires to purchase shares under the Plan and showing the aggregate
amount which the Eligible Employee elects to have withheld from his pay for such
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Purchase Period and applied to the purchase of shares. The election to purchase
shares must be delivered on or before the last day of the Subscription Period to
the person or office designated to receive and accept such elections.
In the event the total maximum number of shares resulting from all elections to
purchase under any offering of shares under the Plan exceeds the maximum number
of shares offered under Section 3 of the Plan, the Company reserves the right to
reduce the maximum number of shares which Eligible Employees may purchase
pursuant to their elections to purchase, to allot the shares available in such
manner as it shall determine, but generally pro rata to subscriptions received
and to grant Options to purchase only for such reduced number of shares. All
shares included in any offering under the Plan in excess of the total number of
shares which all Eligible Employees elect to purchase and all shares with
respect to which elections to purchase are cancelled as provided in Paragraph 12
shall continue to be reserved for the Plan and shall be available for inclusion
in any subsequent offering under the Plan.
9. LIMITATIONS ON NUMBER OF SHARES WHICH MAY BE PURCHASED
The following limitations shall apply with respect to the number of shares which
may be purchased by each Eligible Employee who elects to participate in an
offering under the Plan:
a) No Eligible Employee shall be granted an Option to purchase shares under the
Plan if such Eligible Employee immediately after such Option is granted, owns
stock or holds Options to purchase stock possessing 5% or more of the total
combined voting power or value of the capital stock of the Company or of any of
its Subsidiaries; and
b) No Eligible Employee may be granted an Option to purchase shares which
permits his rights to purchase stock under the Plan and all other stock option
plans of the Company and of any of its Subsidiaries pursuant to Section 423 of
the Code to accrue at a rate which exceeds in any one calendar year $25,000 of
the fair market value of such stock (determined on the date the option to
purchase is granted).
10. RIGHTS AS STOCKHOLDER
An Eligible Employee will become a stockholder of the Company with respect to
shares for which payment has been completed at the close of business on the last
business day of the Purchase Period. An Eligible Employee will have no rights as
a stockholder with respect to shares under an election to purchase shares until
he/she has become a stockholder as provided above. At the end of the Purchase
Period, eligible employees will receive a form indicating the methods of
distribution of Centennial stock purchased under the Plan.
11. RIGHTS TO PURCHASE SHARES NOT TRANSFERABLE
An Eligible Employee's rights under his election to purchase shares may not be
sold, pledged, assigned or transferred in any manner otherwise than by will or
the laws of descent and distribution. If this provision is violated, the right
of the Eligible Employee to purchase shares shall terminate and the only right
remaining under such Eligible Employee's election to purchase will be to have
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paid over to the person entitled thereto the amount then credited to the
Eligible Employee's account, without interest.
12. CANCELLATION OF ELECTION TO PURCHASE
An Eligible Employee who has elected to purchase shares may elect on of the
three options to change or cancel his/her election one time during the Purchase
Period. Only one such election is permitted by any employee during any Purchase
Period. Any such cancellation shall be effective upon the delivery by the
Eligible Employee of written notice of cancellation to the office or person
designated to receive elections. Such notice of cancellation must be so
delivered before the close of business on the last business day of the Purchase
Period. If an Eligible Employee reduces the amount authorized to be withheld
from his/her pay, he/she shall continue to make installment payments at the
reduced rate for the remainder of the Purchase Period.
The three options are:
(a) He/She may terminate all future contributions and receive in cash, without
interest, as soon as administratively practicable after delivery of the
notice of cancellation, the amount then credited to his account, or
(b) He/She may terminate all future contributions but keep his/her existing
contributions in his/her account and receive shares at the end of the
Purchase Period according to Plan procedures, or
(c) He/She may reduce the amount of contributions withheld from each paycheck
for the remainder of the Purchase Period after delivery of the
Cancellation/Change Authorization form.
13. LEAVE OF ABSENCE OR LAYOFF
An Eligible Employee purchasing stock under the Plan who is granted a leave of
absence (including a military leave) during the Purchase Period and such absence
is for a period of 90 days or less (or if for a period in excess of 90 days, the
Employee's right of reemployment with the Company is guaranteed either by
statute or by contract), may during such period of absence make payments in cash
to the Company in amounts equal to what such payments would have been pursuant
to corresponding payroll deductions.
14. EFFECT OF FAILURE TO MAKE PAYMENTS WHEN DUE
If in any payroll period, for any reason not set forth in Paragraph 13, an
Eligible Employee who has filed an election to purchase shares under the Plan
has no pay or his/her pay is insufficient (after other authorized deductions) to
permit deduction of his/her installment payment, such payment may be made in
cash at the time. If not so made, the Eligible Employee, when his/her pay is
again sufficient to permit the resumption of installment payments, must pay in
cash the amount of the deficiency in his/her account or arrange for uniformly
increased installment payments so that, assuming the maximum purchase price per
share, payment for the maximum number of shares covered by his/her Option will
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be completed in the last month of the Purchase Period. If the eligible employee
elects to make increased installment payments, he/she may, nevertheless, at any
time, make up the remaining deficiency by a lump sum payment. Subject to the
above and other provisions of the plan permitting postponement, the Company may,
in its sole discretion, treat the failure by an Eligible Employee to make any
payment as a cancellation of his/her election to purchase shares. Such
cancellation will be effected by mailing notice to him/her at his/her last known
business or home address. Upon such mailing, his/her only right will be to
receive in cash, without interest, the amount credited to his/her account.
15. DEATH
If an Eligible Employee dies and has an election to purchase shares in effect at
the time of his/her death, the legal representative of the deceased Eligible
Employee may, within three months from the date of death (but in no event later
than the end of the Purchase Period), by delivering written notice to the office
or person designated to receive elections, elect to:
(a) Complete the remaining installment payments in cash,
(b) Make a lump sum payment in the amount of any deficiency for the remaining
portion of the Purchase Period, or
(c) Cancel the election to purchase shares in accordance with the provisions of
Paragraph 12.
If no such notice is given within such period, the election will be deemed
cancelled as of the date of death, and the only right of such legal
representative will be to receive in cash, without interest, the amount credited
to the deceased Eligible Employee's account.
16. TERMINATION OF EMPLOYMENT OTHER THAN FOR DEATH
If an Eligible Employee's employment is terminated for any reason other than
death prior to the end of the Purchase Period, his/her election to purchase
shall thereupon be deemed cancelled as of the date on which his employment
ended. In such an event, no further payments under such election will be
permitted, and the Eligible Employee's only right will be to receive in cash,
without interest, the amount credited to his account.
17. APPLICATION OF FUNDS, INTEREST
All funds received by the Company in payment for shares purchased under the Plan
and held by the Company at any time may be used for any valid corporate purpose.
All cash payments to be made to Eligible Employees hereunder shall be made
exclusive of interest.
18. GOVERNMENTAL APPROVALS OR CONSENTS
The Plan shall not be effective unless it is approved by the stockholders of the
Company within 12 months after the Plan is adopted by the Board of Directors of
the Company. The Plan and any offerings and sales to Eligible Employees under it
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are subject to any governmental approvals or consents that may be or become
applicable in connection therewith. The Board of Directors of the Company may
make such changes in the Plan and include such terms in any offering under the
Plan as may be necessary or desirable, in the opinion of counsel, so that the
Plan will comply with the rules and regulations of any governmental authority
and so that Eligible Employees participating in the Plan will be eligible for
tax benefits under the Code or the laws of any state.
