R
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Preliminary
Proxy Statement
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£
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Confidential,
for use of the Commission Only (as permitted by Rule
14a-6(e)(2))
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£
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Definitive
Proxy Statement
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£
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Definitive
Additional Materials
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£
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Soliciting
Material Pursuant to §240.14a-12
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R
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No
fee required.
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£
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Fee
computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
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(1)
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Title
of each class of securities to which transaction
applies:
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(2)
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Aggregate
number of securities to which transaction applies:
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(3)
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Per
unit price or other underlying value of transaction computed pursuant to
Exchange Act Rule 0-11 (set forth the amount on which the filing fee
is calculated and state how it was determined):
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(4)
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Proposed
maximum aggregate value of transaction:
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(5)
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Total
fee paid:
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o
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Fee
paid previously with preliminary materials.
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o
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Check
box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its
filing.
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(1)
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Amount
Previously Paid:
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(2)
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Form,
Schedule or Registration Statement No.:
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(3)
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Filing
Party:
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(4)
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Date
Filed:
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1.
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vote
on the election of three directors for three-year terms expiring in 2013
and one director for a one-year term expiring in 2011;
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2.
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vote
on an amendment to our Restated Certificate of Incorporation to increase
the number of authorized shares of our common stock, $0.001 par
value;
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3.
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vote
on the ratification of the Audit Committee’s appointment of
PricewaterhouseCoopers LLP as independent registered public accounting
firm for our fiscal year ending December 31, 2010; and
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4.
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transact
such other business as may properly come before the annual meeting or any
adjournment or postponement
thereof.
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By
order of the Board of
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Directors,
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Richard
P. Dobb
Corporate
Secretary and Chief
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Administrative
Officer
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Your
Vote is Important to Us. Even if You Plan to Attend the Meeting in
Person,
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PLEASE
SIGN, DATE AND RETURN THE ENCLOSED PROXY PROMPTLY OR
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VOTE
BY TELEPHONE OR THE INTERNET.
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Q:
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Why am I receiving these
materials?
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A:
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Our
Board of Directors is providing these proxy materials to you in connection
with its solicitation of proxies for use at the Internap 2010 Annual
Meeting of Stockholders, which will take place on June 17, 2010, at our
corporate headquarters located at 250 Williams Street, Suite E-100,
Atlanta, Georgia, at 10:00 a.m. local time. You are invited to attend the
annual meeting and are requested to vote upon the proposals described in
this proxy statement.
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Q:
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What
information is contained in these materials?
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A:
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The
information included in this proxy statement relates to the proposals to
be voted upon at the annual meeting, the voting process, the compensation
of our directors and named executive officers and certain other required
information. Our Annual Report to Stockholders for the year ended December
31, 2009, which includes our audited consolidated financial statements for
the years ended December 31, 2009, 2008 and 2007, is included in these
proxy materials. Your proxy, which you may use to vote, is also
enclosed.
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Q:
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What
proposals will be voted upon at the annual meeting?
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A:
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There
are three proposals scheduled to be voted upon at the annual
meeting:
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●
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election
of three directors for three-year terms expiring in 2013 and election of
one director for a one-year term expiring in 2011;
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●
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approval
of an amendment to our Restated Certificate of Incorporation to increase
the number of authorized shares of our common stock;
and
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●
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ratification
of the appointment of PricewaterhouseCoopers LLP as the independent
registered public accounting firm for our fiscal year ending December 31,
2010.
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In
addition, such other business as may properly come before the annual
meeting will be considered and voted upon. We are not currently aware of
any other matters to be considered and voted upon at the
meeting.
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||
Q:
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How
does Internap’s Board of Directors recommend that I
vote?
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A:
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Your
Board of Directors recommends that you vote your shares “FOR” each of the
nominees to the Board of Directors, “FOR” approval of the amendment to our
Restated Certificate of Incorporation to increase the number of authorized
shares of our common stock and “FOR” ratification of the appointment of
PricewaterhouseCoopers LLP as the independent registered public accounting
firm for our fiscal year ending December 31, 2010.
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Q:
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Who may
vote?
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A:
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You
may vote at the annual meeting or by proxy if you were a stockholder of
record at the close of business on April 19, 2010. Each stockholder is
entitled to one vote per share on each matter presented. As of April 19,
2010, there were _______________ shares of our common stock
outstanding.
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Q:
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How
do I vote before the annual meeting?
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A:
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We
offer the convenience of voting by mail-in proxy, telephone or the
Internet as described in more detail below. See the enclosed proxy for
voting instructions. If you properly sign and return the proxy in the form
we have provided or properly vote by telephone or the Internet, your
shares will be voted at the annual meeting and at any adjournment of that
meeting.
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Q:
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What
if I return my proxy but do not provide voting
instructions?
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A:
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If
you specify a choice, your proxy will be voted as specified. If you return
a signed proxy but do not specify a choice, your shares will be voted
“for” the election of all nominees named in this proxy statement, “for”
approval of an amendment to our Restated Certificate of Incorporation to
increase the number of authorized shares of our common stock and “for” the
ratification of PricewaterhouseCoopers LLP as the independent registered
public accounting firm for our fiscal year ending December 31, 2010. In
all cases, your proxy will be voted in the discretion of the individuals
named as proxies on the proxy card with respect to any other matters that
may come before the annual meeting.
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Q:
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Can I change my mind after I
vote?
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A:
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You
may revoke your proxy at any time before it is exercised by delivering
written notice of revocation to the Corporate Secretary of Internap or by
attending and voting at the annual meeting.
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Q:
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How
can I vote my shares in person at the annual meeting?
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A:
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Shares
held directly in your name as the stockholder of record may be voted in
person at the annual meeting. If you choose to vote in person, please
bring the enclosed proxy card and proof of identification. Even if you
plan to attend the annual meeting in person, we recommend that you vote
your shares in advance as described below so that your vote will be
counted if you later decide not to attend the annual meeting. Shares held
in “street name” through a brokerage account or by a bank or other nominee
may be voted in person by you if you obtain a signed proxy from the record
holder giving you the right to vote the shares.
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Q:
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What
is the quorum requirement for the annual meeting?
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A:
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The
presence in person or by proxy of the holders of a majority of the shares
entitled to vote at the annual meeting is necessary to constitute a
quorum. If a registered stockholder indicates on his or her proxy card
that the stockholder wishes to abstain from voting, or a beneficial owner
instructs its bank, broker or other nominee that the stockholder wishes to
abstain from voting, these shares are considered present and entitled to
vote at the annual meeting. These shares will count toward determining
whether or not a quorum is present.
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Q:
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What
is the voting requirement to approve each of the
proposals?
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A:
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A
plurality of the shares voting is required to elect directors. This means
that the nominees who receive the most votes will be elected. In counting
votes on the election of directors, only votes “for” or “withheld” affect
the outcome. Broker non-votes (which are explained below) will be counted
as not voted and will be deducted from the total shares of which a
plurality is required.
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The
affirmative vote of holders of a majority of the outstanding shares
entitled to vote at the annual meeting is required to approve the proposed
amendment to our Restated Certificate of Incorporation to increase the
number of authorized shares of our common stock. In counting votes on this
proposal, abstentions, broker non-votes and other shares not voted will be
counted as votes “against” the proposal.
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Each
other matter requires the affirmative vote of a majority of the shares
present or represented at the annual meeting and entitled to vote upon the
proposal. In counting votes on these other matters, abstentions will be
counted as votes “against” the matter and broker non-votes, if any, will
not be counted as votes cast and therefore will have no
effect.
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Q:
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What are broker non-votes and
what effect do they have on the proposals?
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A:
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Generally,
broker non-votes occur when shares held by a broker in “street name” for a
beneficial owner are not voted with respect to a particular proposal
because (a) the broker has not received voting instructions from the
beneficial owner and (b) the broker lacks discretionary voting power to
vote those shares.
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If
you do not vote your proxy and your shares are held in street name, your
brokerage firm may either vote your shares on routine matters or leave
your shares unvoted. On non-routine matters, if the brokerage firm has not
received voting instructions from you, the brokerage firm cannot vote your
shares on that proposal, which is considered a “broker non-vote.” Broker
non-votes will be counted for purposes of establishing a quorum to conduct
business at the annual meeting. The proposal for the ratification of the
appointment of our independent registered public accounting firm is
routine. The proposal for approval of an amendment to our Restated
Certificate of Incorporation to increase the number of authorized shares
of our common stock is non-routine. The New York Stock Exchange recently
eliminated broker discretionary voting for the election of directors.
Therefore, unlike in prior years, your broker is not able to vote
uninstructed shares on your behalf in any director election. These rules
apply to us even though our common stock is traded on The NASDAQ Global
Market (“Nasdaq”). Accordingly, brokers that do not receive instructions
will be entitled to vote on the ratification of the appointment of our
independent registered public accounting firm at the annual meeting, but
may not vote for the election of directors or for approval of an amendment
to our Restated Certificate of Incorporation to increase the number of
authorized shares of our common stock. Therefore, we encourage you to sign
and return your proxy, with voting instructions, before the annual meeting
so that your shares will be represented and voted at the meeting even if
you cannot attend in person.
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Q:
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What
does it mean if I receive more than one proxy or voting instruction
card?
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A:
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It
means that your shares are registered differently or are in more than one
account. Please provide voting instructions for all proxy and voting
instruction cards you receive.
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Q:
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Where
can I find the voting results of the annual meeting?
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A:
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We
will announce preliminary voting results at the annual meeting and publish
final results in a current report on Form 8-K shortly after the
meeting.
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●
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reviewing
and approving the company’s key objectives and strategic business plans
and monitoring implementation of those plans and our success in meeting
identified objectives;
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●
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reviewing
the company’s financial objectives and major corporate plans, business
strategies and actions;
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●
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selecting,
evaluating and compensating the Chief Executive Officer and overseeing
Chief Executive Officer succession planning;
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●
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providing
advice and oversight regarding the selection, evaluation, development and
compensation of executive management;
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●
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reviewing
significant risks confronting our company and alternatives for their
mitigation; and
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●
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assessing
whether adequate policies and procedures are in place to safeguard the
integrity of our business operations and financial reporting and to
promote compliance with applicable laws and regulations, and monitoring
management’s administration of those policies and
procedures.
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Audit
Committee
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Compensation
Committee
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Nominations
and Governance
Committee
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||
Gary
M. Pfeiffer (Committee Chair)
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Charles
B. Coe (Committee Chair)
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Patricia
L. Higgins (Committee Chair)
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Eugene
Eidenberg
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Patricia
L. Higgins
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Charles
B. Coe
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||
Kevin
L. Ober
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Michael
A. Ruffolo
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Gary
M. Pfeiffer
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||
Debora
J. Wilson
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Daniel
C. Stanzione
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Daniel
C. Stanzione
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●
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appoints,
retains, compensates, oversees, evaluates and, if appropriate, terminates
our independent registered public accounting firm;
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●
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annually
reviews the performance, effectiveness, objectivity and independence of
our independent registered public accounting firm and our internal audit
function;
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●
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establishes
procedures for the receipt, retention and treatment of complaints
regarding accounting and auditing matters;
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●
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reviews
with our independent registered public accounting firm the scope and
results of its audit;
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●
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approves
all audit services and pre-approves all permissible non-audit services to
be performed by our independent registered public accounting
firm;
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●
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assesses
and provides oversight to management relating to identification and
evaluation of major risks inherent in our business and the control
processes with respect to such risks;
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●
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oversees
the financial reporting process and discusses with management and our
independent registered public accounting firm the interim and annual
financial statements that we file with the SEC;
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●
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reviews
and monitors our accounting principles, policies and financial and
accounting processes and controls; and
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●
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oversees
the internal auditor and reviews and approves the annual internal audit
plan.
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●
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assists
the Board in discharging its responsibilities relating to executive
compensation and fulfilling its responsibilities relating to our
compensation and benefit programs and policies;
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●
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oversees
the overall compensation structure, policies and programs, and assesses
whether the compensation structure establishes appropriate incentives for
management and employees;
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●
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administers
and makes recommendations with respect to our incentive compensation
plans, including stock option and other equity-based incentive
plans;
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●
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reviews
and approves the compensation of our executive officers, including bonuses
and equity compensation;
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●
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reviews
and approves corporate and personal goals and objectives relevant to
executive officers other than the Chief Executive Officer, evaluates the
performance of such executive officers in light of these goals and
objectives and approves the compensation of the executive officers based
on the evaluation;
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●
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reviews
corporate and personal goals and objectives relevant to the Chief
Executive Officer, evaluates the performance of the Chief Executive
Officer in light of these goals and objectives and recommends to the full
Board the compensation of the Chief Executive Officer based on the
evaluation;
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●
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reviews
and discusses with management our Compensation Discussion and Analysis and
related disclosures required by the rules of the SEC and recommends to the
Board whether such disclosures should be included in our annual report and
proxy statement;
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●
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reviews
and recommends employment agreements and severance arrangements for
executive officers, including change in control provisions;
and
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●
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reviews
annually the compensation of directors for service on the Board and
committees and makes recommendations to the Board regarding such
compensation.
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●
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assists
the Board in fulfilling its responsibilities on matters and issues related
to our corporate governance practices;
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●
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in
conjunction with the Board, establishes qualification standards for
membership on the Board and its committees;
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●
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leads
the search for individuals qualified to become members of the Board,
reviews the qualifications of candidates for election to the Board and
assesses the contributions and independence of incumbent directors
eligible to stand for re-election to the Board;
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●
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selects
and recommends to the Board the nominees for election or re-election by
the stockholders at the annual meeting, and fills vacancies and newly
created directorships on the Board;
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●
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develops
and recommends to the Board corporate governance guidelines, reviews the
guidelines on an annual basis and recommends any changes to the guidelines
as necessary;
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●
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establishes
and recommends to the Board guidelines, in accordance with applicable
rules and regulations, to be applied when assessing the “independence” of
directors;
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●
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reviews
and approves related person transactions, as defined in applicable SEC
rules, and establishes policies and procedures for the review, approval
and ratification of related person transactions;
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●
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annually
reviews and makes recommendations to the Board concerning the structure,
composition and functioning of the Board and its committees and recommends
to the Board directors to serve as committee members and
chairpersons;
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●
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reviews
directorships in other public companies held by or offered to
directors;
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●
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develops
and recommends to the Board for its approval an annual self-evaluation
process for the Board and its committees and oversees the evaluation
process; and
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●
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reviews
and reports on all matters generally relating to corporate
governance.
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●
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the
person filling each role;
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●
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the
composition, independence and effectiveness of the entire
Board;
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●
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other
corporate governance structures in place;
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●
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the
compensation practices used to motivate our leadership
team;
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●
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our
leadership succession plan; and
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●
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the
competitive and economic environment facing the
company.
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●
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are
well documented, appropriately communicated, consistently applied and
reviewed annually by the Compensation Committee;
|
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●
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are
based on both individual performance and company performance metrics that
are tied to the strategic goals and objectives of the
company;
|
|
●
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balance
short- and long-term rewards, with compensation capped at levels
consistent with industry standards;
|
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●
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do
not encourage excessive risk taking, focus on short-term gains rather than
long-term value creation, reward circumvention of controls or contain
unrealistic goals and/or targets; and
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●
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are
compared to industry standards and peer companies on an on-going basis by
both the internal compensation department as well as independent
compensation consultants and amended periodically to maintain consistency
with common practices.
|
Common
Stock Beneficially
Owned
|
||||||
Name
and Address of Beneficial Owner
|
Number
of
Shares
|
Percent
of
Class(1)
|
||||
BlackRock,
Inc.(2)
|
2,993,245
|
5.77%
|
||||
Dimensional
Fund Advisors LP(3)
|
2,665,178
|
5.14%
|
||||
Kornitzer
Capital Management, Inc. (4)
|
3,395,850
|
6.55%
|
Common
Stock Beneficially
Owned
|
||||||
Name
and Address of Beneficial Owner
|
Number
of
Shares(1)
|
Percent
of
Class(2)
|
||||
Charles
B. Coe
|
86,900
|
*
|
||||
J.
Eric Cooney(3)
|
807,092
|
1.6
|
%
|
|||
Eugene
Eidenberg(4)
|
281,056
|
*
|
||||
William
J. Harding(5)
|
30,684
|
*
|
||||
Patricia
L. Higgins
|
74,629
|
*
|
||||
Kevin
L. Ober
|
34,202
|
*
|
||||
Gary
M. Pfeiffer
|
45,900
|
*
|
||||
Michael
A. Ruffolo
|
15,957
|
*
|
||||
Daniel
C. Stanzione
|
83,900
|
*
|
||||
Debora
J. Wilson
|
28,957
|
*
|
||||
George
E. Kilguss III
|
249,200
|
*
|
||||
Richard
P. Dobb
|
111,453
|
*
|
||||
Randal
R. Thompson
|
110,510
|
*
|
||||
Steven
A. Orchard
|
53,726
|
|||||
James
P. DeBlasio(6)
|
245,284
|
*
|
||||
Timothy
P. Sullivan(7)
|
—
|
*
|
||||
All
directors and executive officers as a group (16 persons)
|
2,259,450
|
4.3
|
%
|
Name
|
Options
|
|||
Charles
B. Coe
|
58,270
|
|||
J.
Eric Cooney
|
25,000
|
|||
Eugene
Eidenberg
|
157,269
|
|||
William
J. Harding
|
—
|
|||
Patricia
L. Higgins
|
56,270
|
|||
Kevin
L. Ober
|
22,133
|
|||
Gary
M. Pfeiffer
|
22,270
|
|||
Michael
A. Ruffolo
|
—
|
|||
Daniel
C. Stanzione
|
56,270
|
|||
Debora
J. Wilson
|
—
|
|||
George
E. Kilguss III
|
19,804
|
|||
Richard
P. Dobb
|
19,658
|
|||
Randal
R. Thompson
|
15,137
|
|||
Steven
A. Orchard
|
21,262
|
|||
James
P. DeBlasio
|
—
|
|||
Timothy
P. Sullivan
|
—
|
|||
Directors
and executive officers as a group
|
473,343
|
Name
|
Age
|
Position
|
||
J.
Eric Cooney
|
44
|
Chief
Executive Officer and President
|
||
George
E. Kilguss III
|
49
|
Chief
Financial Officer
|
||
Richard
P. Dobb
|
56
|
Chief
Administrative Officer
|
||
Randal
R. Thompson
|
42
|
Senior
Vice President, Global Sales
|
||
Steven
A. Orchard
|
38
|
Senior
Vice President, Operations and
Support
|
●
|
Compensation
Philosophy and Objectives
|
|
●
|
Compensation
Consultant and Market Comparisons
|
|
●
|
Overview
of Compensation Components
|
|
●
|
2009
Compensation Decisions and 2010
Actions
|
●
|
J.
Eric Cooney, Chief Executive Officer and President
|
|
●
|
George
E. Kilguss III, Chief Financial Officer
|
|
●
|
Richard
P. Dobb, Chief Administrative Officer
|
|
●
|
Randal
R. Thompson, Senior Vice President, Global Sales
|
|
●
|
Steven
A. Orchard, Senior Vice President, Operations and
Support
|
●
|
attract,
motivate, reward and retain highly-qualified executives who will lead our
company and achieve and inspire superior performance;
|
|
●
|
provide
incentives for achieving specific near-term individual, business unit and
corporate goals and reward goal attainment at established
levels;
|
|
●
|
provide
incentives for achieving longer-term corporate goals;
and
|
|
●
|
align
the interests of named executive officers and other executives with those
of our stockholders to reward increasing stockholder
value.
|
●
|
2008
Confidential Radford Executive Compensation Survey; Telecommunications
Products/Services; Revenues $200 million to $1 billion;
|
|
●
|
2007
William M. Mercer Executive Compensation Report, All Organizations,
Revenue less than $1 billion; and
|
|
●
|
2007
Watson Wyatt Industry Report on Top Management Compensation, All
Organizations; Revenue $150 million to $750
million.
|
Akamai Technologies, Inc. | Global Crossing Ltd. | Riverbed Technology Inc. |
Blue Coat Systems | Level 3 Communications Inc. | Savvis Inc. |
Cbeyond Inc. | Limelight Networks Inc. | Switch & Data Facilities Co. |
Cogent Communications Group | Navisite Inc. | Terremark Worldwide Inc. |
Equinix Inc. | Paetec Holding Corp. | XO Holdings Inc. |
Akamai Technologies, Inc. | F5 Networks, Inc. | Rackspace Hosting, Inc. |
Aruba Networks, Inc. | InfoSpace, Inc. | Riverbed Technology Inc. |
Blue Coat Systems | j2 Global Communications, Inc. | Savvis Inc. |
Cbeyond Inc. | Limelight Networks Inc. | Switch & Data Facilities Co. |
Cogent Communications Group | Navisite Inc. | Terremark Worldwide Inc. |
Digital River, Inc. | NeuStar, Inc. | Veraz Networks, Inc. |
Equinix Inc. | Omniture, Inc. | Websense, Inc. |
Pay
Element
|
What
the Pay Element Rewards
|
Purpose
of the Pay Element
|
|
Base
Salary
|
● Core
responsibilities, skills, knowledge and years of service with us and/or
experience in similar positions
|
● Provide
a regular and stable source of income to the named executive
officers
|
|
Annual Incentive Compensation | ● Achieving specific corporate objectives with respect to which the named executive officer has reasonable control, influence or input |
● Focus
named executive officers on specific annual goals that contribute to our
success
|
|
● Achieving specific business unit objectives over which the named executive officer has reasonable control | ● Provide annual performance-based cash compensation | ||
● Achieving specific personal objectives | ● Reward participants for achieving specified objectives | ||
Long-Term
Incentive Compensation
|
● Achieving long-term corporate objectives with respect to which the named executive officer has reasonable control, influence or input |
● More
closely align named executive officers’ interests with stockholders’
interests
|
|
● Achieving results that drive stockholder value | ● Reward named executive officers for building stockholder value | ||
● Continuing
employment with us during the vesting period
|
● Encourage long-term investment in us by named executive officers | ||
● Retain
named executive officers
|
●
|
Mr.
Kilguss’ base salary was increased to $290,000 from $275,000. This
increase of 5.5% reflects his level of personal performance and overall
contribution to our results, the impact of his role and finance
organization on us and the degree of market competitiveness of his base
salary level.
|
|
●
|
Mr.
Dobb’s base salary was increased to $280,000 from $272,800. This increase
of 2.6% reflects his level of personal performance and organizational
impact and the degree of market competitiveness of his base salary
level.
|
|
●
|
Mr.
Thompson’s base salary was increased to $230,000 from $225,000. This
increase of 2.2% reflects his personal and organizational level of
performance, as well as the degree of market competitiveness of his base
salary level.
|
|
●
|
Mr.
Orchard’s base salary was increased to $195,000 from $185,000. This
increase of 5.4% reflects his personal performance since assuming
responsibility as our Senior Vice President, Operations and
Support.
|
●
|
focus
participants’ actions on the achievement of annual corporate financial
goals;
|
|
●
|
encourage
and reward participants for the achievement of specified individual goals
and/or business unit goals; and
|
|
●
|
maintain
a competitive range of incentive compensation
opportunities.
|
●
|
revenue
of $284.8 million (30% of potential award);
|
|
●
|
adjusted
earnings before interest, taxes, depreciation and amortization (“EBITDA”)
of $40.3 million (20% of potential award);
|
|
●
|
free
cash flow of $15.3 million (20% of potential award);
and
|
|
●
|
personal
and business unit goals specific to each named executive officer (30% of
potential award).
|
Name
|
Target
of
Base
Salary
(%)
|
2009
STIP
Target(1)
($)
|
Maximum
of
Base
Salary
(%)
|
2009
STIP
Maximum
($)
|
2009
STIP
Award(2)
($)
|
|||||||||||||||
J. Eric
Cooney
|
100%
|
|
$ |
475,000
|
(3)
|
200%
|
|
$ |
950,000
|
$ |
200,000
|
|||||||||
George
E. Kilguss III
|
50%
|
|
137,500
|
100%
|
|
275,000
|
97,103
|
|||||||||||||
Richard
P. Dobb
|
50%
|
|
136,400
|
100%
|
|
272,800
|
55,768
|
|||||||||||||
Randal
R. Thompson
|
50%
|
|
105,729
|
100%
|
|
211,458
|
36,885
|
|||||||||||||
Steven
A. Orchard
|
40%
|
|
70,568
|
80%
|
|
141,136
|
62,557
|
(1)
|
The
target amount that a named executive could earn was based on the actual
base salary earned during 2009.
|
(2)
|
These
amounts were paid in March 2010.
|
(3)
|
Mr.
Cooney’s plan target was prorated for his partial-year
service.
|
●
|
revenue
(30% of potential award);
|
|
●
|
adjusted
EBITDA (40% of potential award); and
|
|
●
|
personal
and business unit goals specific to each named executive officer (30% of
potential award).
|
At
Threshold(1)
|
At
Target
(%)
|
At
Target(2)
($)
|
At
Stretch
(%)
|
At
Stretch
($)
|
|||||||||||||||
J.
Eric Cooney
|
– | 100% | $ | 600,000 | 200% | $ | 1,200,000 | ||||||||||||
George
E. Kilguss III
|
– | 50% | 145,000 | 100% | 290,000 | ||||||||||||||
Richard
P. Dobb
|
– | 50% | 140,000 | 100% | 280,000 | ||||||||||||||
Randal
R. Thompson
|
– | 50% | 115,000 | 100% | 230,000 | ||||||||||||||
Steven
A. Orchard
|
– | 40% | 78,000 | 80% | 156,000 |
●
|
split
the value of the grant of equity awards into 50% restricted stock and 50%
stock options;
|
|
●
|
modify
the vesting of future restricted stock awards to be 100% time-based
vesting;
|
|
●
|
discontinue
the use of the prior formula-based approach for determining equity award
amounts in favor of determining award values based on the results of
competitive market data discussed above in “Compensation Consultant and
Market Comparisons;”
|
|
●
|
grant
stock options with vesting of 25% on the first anniversary of the grant
date and 36 equal monthly installments thereafter; and
|
|
●
|
grant
restricted stock with vesting of 25% annually in four equal annual
installments.
|
Restricted
Stock
|
Stock
Options
|
||||||||
Name
|
(#)
|
(#)
|
|||||||
J.
Eric Cooney
|
32,092
|
(1)
|
248,830
|
||||||
George
E. Kilguss III
|
13,352
|
103,530
|
|||||||
Richard
P. Dobb
|
7,597
|
58,905
|
|||||||
Randal
R. Thompson
|
7,597
|
58,905
|
|||||||
Steven
A. Orchard
|
7,597
|
58,905
|
(1) Pursuant
to his offer letter, Mr. Cooney was granted 200,000 shares of restricted
stock on March 16, 2010 and will be entitled to an additional 200,000
shares of restricted stock on March 16, 2011, the second anniversary of
his commencement of employment.
|
The
Compensation Committee believes that the compensation program for the
named executive officers provides significant performance incentives.
Specifically, the 2010 STIP provides incentives for performance and
includes defined performance thresholds and maximum opportunity levels for
each of the named executive officers. The restricted stock and stock
option grants encompassing our long-term incentive program also provide
longer-term incentives since recipients can benefit significantly from
appreciation in our stock price. The increased level of stock option
grants in the equity awards focuses recipients on stock price
appreciation, thus furthering the goal of rewarding performance and
aligning the interests of the named executive officers with those of our
stockholders. Because these awards vest over time, they also serve as a
retention device.
|
Position
|
Retention
Ratio
|
Time
to Retain
From
Date of
Acquisition
|
|||
Chief
Executive Officer
|
50.0%
|
Five
Years
|
|||
Chief
Financial Officer
|
33.0%
|
Four
Years
|
|||
Chief
Administrative Officer
|
33.0%
|
Four
Years
|
|||
Senior
Vice President, Global Sales
|
33.0%
|
Four
Years
|
Name
|
Severance
Payment
($)
|
Accelerated
Vesting
of
Equity
Awards
($)
|
|||
J.
Eric Cooney
|
4,500,000(1)
|
2,886,000(2)
|
|||
George
E. Kilguss III
|
550,000
|
1,028,854
|
|||
Richard
P. Dobb
|
1,091,200
|
505,378
|
|||
Randal
R. Thompson
|
450,000
|
398,772
|
|||
Steven
A. Orchard(3)
|
—
|
187,865
|
|||
Name
and Principal
Position
|
Year
|
Salary | Bonus |
Stock
Awards(1)
|
Option Awards(2) |
Non-Equity
Incentive
Plan
Compensation(3)
|
All Other Compensation(4) | Total | ||||||||||||||||||||||
J. Eric Cooney | 2009 |
$
|
475,000 |
$
|
300,000
|
(6) |
$
|
1,568,000
|
(7)
|
$ |
838,440
|
$
|
200,000
|
$
|
41
|
$
|
3,381,481
|
|||||||||||||
President
and Chief
Executive
Officer(5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
George
E. Kilguss III
|
2009
|
275,000
|
—
|
95,758
|
107,479
|
97,103
|
7,404
|
582,744
|
||||||||||||||||||||||
Chief
Financial Officer(8)
|
2008
|
202,196
|
—
|
962,000
|
—
|
—
|
91,837
|
1,256,033
|
||||||||||||||||||||||
Richard
P. Dobb
|
2009
|
272,800
|
—
|
109,647
|
(10)
|
106,687
|
55,768
|
7,404
|
552,306
|
|||||||||||||||||||||
Chief
Administrative Officer(9)
|
2008
|
260,400
|
—
|
113,780
|
(10)
|
—
|
—
|
6,954
|
381,134
|
|||||||||||||||||||||
2007
|
180,000
|
—
|
460,800
|
—
|
122,580
|
4,554
|
767,934
|
|||||||||||||||||||||||
Randal
R. Thompson
|
2009
|
211,458
|
—
|
70,996
|
(10)
|
66,324
|
36,885
|
5,132
|
390,795
|
|||||||||||||||||||||
Senior
Vice President, Global Sales
|
2008
|
200,000
|
—
|
80,006
|
(10)
|
—
|
—
|
4,479
|
284,485
|
|||||||||||||||||||||
2007
|
167,010
|
30,000
|
567,650
|
—
|
125,000
|
197,487
|
1087,147
|
|||||||||||||||||||||||
Steven
A. Orchard
|
2009
|
176,421
|
—
|
53,280
|
66,949
|
62,577
|
5,347
|
364,574
|
||||||||||||||||||||||
Senior
Vice President, Operations
|
2008
|
160,095
|
—
|
10,088
|
—
|
—
|
3,179
|
173,362
|
||||||||||||||||||||||
and Support |
2007
|
139,689
|
—
|
82,450
|
—
|
45,000
|
3,223
|
270,362
|
||||||||||||||||||||||
James
P. DeBlasio
|
2009
|
95,833
|
—
|
—
|
—
|
—
|
979,592
|
1,075,425
|
||||||||||||||||||||||
Former
Chief Executive Officer(11)
|
2008
|
460,000
|
—
|
469,519
|
(10)
|
—
|
—
|
114,618
|
1,044,137
|
|||||||||||||||||||||
2007
|
425,000
|
—
|
2,061,250
|
—
|
337,663
|
27,462
|
2,851,375
|
|||||||||||||||||||||||
Timothy
P. Sullivan
|
2009
|
160,417
|
—
|
118,321
|
(10)
|
107,479
|
—
|
355,352
|
741,569
|
|||||||||||||||||||||
Former
Chief Technology Officer(12)
|
2008
|
269,792
|
—
|
184,373
|
(10)
|
—
|
—
|
25,193
|
479,358
|
|||||||||||||||||||||
2007
|
180,000
|
—
|
588,742
|
—
|
—
|
54
|
768,796
|
(1) Represents the full grant date fair value of restricted stock awards granted in the years shown, calculated in accordance with FASB ASC Topic 718. We value restricted stock based on the closing market price of our common stock reported on Nasdaq on the various grant dates. For valuation assumptions, see the Notes to our Consolidated Financial Statements for the fiscal years ended December 31, 2009, 2008 and 2007. |
(2) Represents the full grant date fair value of stock options granted in the years shown, calculated in accordance with FASB ASC Topic 718. Stock options were valued using the Black-Scholes model. For additional valuation assumptions, see the Notes to our Consolidated Financial Statements for the fiscal years ended December 31, 2009, 2008 and 2007. |
(3) Includes amounts earned under our annual short-term incentive plans. We did not pay bonuses in 2009 based on our 2008 performance. The amounts reported for 2009 were earned under our 2009 STIP and paid in March 2010. |
(4) The compensation listed in this column for 2009 includes: (a) our matching contributions to the accounts of the named executive officers under our 401(k) savings plan as follows: $0 for Mr. Cooney; $7,350 for Mr. Kilguss; $7,350 for Mr. Dobb; $5,078 for Mr. Thompson; $5,293 for Mr. Orchard; $2,875 for Mr. DeBlasio and $0 for Mr. Sullivan; and (b) payments made by us for premiums on certain life insurance policies in the amount of $41 for Mr. Cooney; $54 for each of Messrs. Kilguss, Dobb, Thompson and Orchard; $14 for Mr. DeBlasio and $32 for Mr. Sullivan. The compensation listed in this column for Mr. DeBlasio also includes $927,200 of severance related to his termination of employment, $10,350 for corporate housing, $2,889 for the use of a company-provided automobile and a gross up of $36,264 for the payment of estimated taxes on taxable reimbursements made to Mr. DeBlasio. The compensation listed in this column for Mr. Sullivan also includes $275,000 of accrued severance related to his termination of employment, $17,438 for corporate housing, $4,398 for the use of a company-provided automobile and a gross up of $58,484 for the payment of estimated taxes on taxable reimbursements made to Mr. Sullivan. |
(5) Mr. Cooney’s employment began in March 2009. |
(6) We paid this sign-on bonus to Mr. Cooney in connection with his commencement of employment. |
(7) Mr. Cooney’s March 2009 offer letter provided for a grant of 200,000 shares of restricted stock on each of the first anniversary and second anniversary of his commencement date. The amount reported in this column includes the grant date fair value of $896,000 attributable to these 400,000 shares of restricted stock which we considered granted per his offer letter. We made the first grant of 200,000 shares of restricted stock in March 2010. We value his restricted stock at $2.24 per share, the closing price of our common stock reported on Nasdaq on the grant date. |
(8) Mr. Kilguss’ employment began in April 2008. |
(9) Mr. Dobb’s employment began in April 2007. |
(10) Amounts reported include the grant date fair value of performance-based restricted stock awards considered granted in March of 2008 and 2009 calculated in accordance with FASB ASC Topic 718. Our Board of Directors established revenue and EBITDA targets in 2008 and 2009 which would either be met or not met in the particular year. If the revenue and EBITDA targets are met for a particular year, 100% of the award for that year will vest in March of the following year. If the revenue and EBITDA targets are not met for a particular year, 50% of the award for that year is forfeited and the remaining 50% of the award will vest in March 2012. For 2008, the amounts reported include $24,802 for Mr. Dobb, $20,004 for Mr. Thompson, $107,341 for Mr. DeBlasio and $38,201for Mr. Sullivan, valued at $4.30 per share, the closing price of our common stock reported on Nasdaq on the date the 2008 targets were established. For 2009, the amounts reported include $14,651 for Mr. Dobb, $11,814 for Mr. Thompson and $22,563 for Mr. Sullivan, valued at $2.54 per share, the closing price of our common stock reported on Nasdaq on the date the 2009 targets were established. The revenue and EBITDA targets were not met in either 2008 or 2009, which resulted in forfeiture of 50% of the award reported for each individual. |
(11) Mr. DeBlasio’s employment ended March 15, 2009. |
(12) Mr. Sullivan’s employment began in November 2006 and ended July 31, 2009. |
Estimated
Future Payouts
Under
Non-Equity Incentive
Plan
Awards(1)
|
All
Other
Stock
Awards:
Number
of
Shares
of
Stock
or
Units(2)
(#)
|
All
Other
Stock
Awards:
Number
of
Securities
Underlying
Options(3)
(#)
|
Exercise
or
Base
Price
of
Option
Awards(4)
($/Sh)
|
Grant
Date
Fair
Value
of
Stock
and
Option
Awards(5)
($)
|
|||||||||||||||||||||
Name
and
Principal
Position
|
Award
Type
|
Grant
Date
|
Threshold
($)
|
Target
($)
|
Maximum
($)
|
||||||||||||||||||||
J. Eric Cooney | Restricted Stock | 3/16/2009 | 300,000 | 672,000 | |||||||||||||||||||||
President
and Chief
|
Restricted
Stock
|
3/16/2009
|
400,000 | (6) | 896,000 | ||||||||||||||||||||
Executive
Officer
|
Stock
Option
|
3/16/2009
|
600,000 | 2.24 | 838,440 | ||||||||||||||||||||
2009
STIP
|
8/19/2009
|
— | 475,000 | 950,000 | |||||||||||||||||||||
George
E. Kilguss, III
|
Restricted
Stock
|
3/25/2009
|
37,700 | 95,758 | |||||||||||||||||||||
Chief
Financial
|
Stock
Option
|
3/25/2009
|
67,900 | 2.54 | 107,479 | ||||||||||||||||||||
Officer
|
2009
STIP
|
8/19/2009
|
— | 137,500 | 275,000 | ||||||||||||||||||||
Richard
P. Dobb
|
Restricted
Stock
|
3/25/2009
|
37,400 | 94,996 | |||||||||||||||||||||
Chief
Administrative
|
Stock
Option
|
3/25/2009
|
67,400 | 2.54 | 106,687 | ||||||||||||||||||||
Officer
|
Performance
Shares(7)
|
3/25/2009
|
5,768 | 14,651 | |||||||||||||||||||||
2009
STIP
|
8/19/2009
|
— | 136,400 | 272,800 | |||||||||||||||||||||
Randal
R. Thompson
|
Restricted
Stock
|
3/25/2009
|
23,300 | 59,182 | |||||||||||||||||||||
SVP,
Global Sales
|
Stock
Option
|
3/25/2009
|
41,900 | 2.54 | 66,324 | ||||||||||||||||||||
Performance
Shares(7)
|
3/25/2009
|
4,652 | 11,814 | ||||||||||||||||||||||
2009
STIP
|
8/19/2009
|
— | 105,729 | 211,458 | |||||||||||||||||||||
Steven
A. Orchard
|
Restricted
Stock
|
3/25/2009
|
13,800 | 35,052 | |||||||||||||||||||||
SVP,
Operations and
|
Stock
Option
|
3/25/2009
|
24,800 | 2.54 | 39,256 | ||||||||||||||||||||
Support
|
Restricted
Stock
|
7/14/2009
|
6,200 | 18,228 | |||||||||||||||||||||
Stock
Option
|
7/14/2009
|
15,200 | 2.94 | 27,693 | |||||||||||||||||||||
2009
STIP
|
8/19/2009
|
— | 70,568 | 141,136 | |||||||||||||||||||||
James
P. DeBlasio(8)
|
— | — | — | — | — | — | — | — | — | ||||||||||||||||
Former
Chief
|
|||||||||||||||||||||||||
Executive
Officer
|
|||||||||||||||||||||||||
Timothy
P. Sullivan
|
Restricted
Stock
|
3/25/2009
|
37,700 | 95,758 | |||||||||||||||||||||
Former
Chief
|
Stock
Option
|
3/25/2009
|
67,900 | 2.54 | 107,479 | ||||||||||||||||||||
Technology
Officer
|
Performance
Shares(7)
|
3/25/2009
|
8,884 | 22,563 |
Option
Awards
|
Stock
Awards
|
|||||||||||||||||||
Name
and Principal
Position
|
Grant
Date
|
Number
of
Securities
Underlying
Unexercised
Options
Exercisable
(#)
|
Number
of Securities Underlying Unexercised
Options
Unexercisable(1)
(#)
|
Option
Exercise
Price
($)
|
Option
Expiration
Date
|
Number
of
Shares
or
Units
of
Stock
That
Have
Not
Vested(2)
(#)
|
Market
Value
of
Shares
or
Units
of
Stock
That
Have
Not
Vested(3)
($)
|
Equity
Incentive
Plan
Awards:
Number
of
Unearned
Shares,
Units
or
Other
Rights
That
Have
Not
Vested
(#)
|
Equity
Incentive
Plan
Awards:
Market
or
Payout
Value
of
Unearned
Shares,
Units
or
Other
Rights
That
Have
Not
Vested
($)
|
|||||||||||
J.
Eric Cooney
|
3/16/2009
|
—
|
600,000
|
2.24
|
3/15/2019
|
|||||||||||||||
President
and Chief
|
3/16/2009
|
300,000
|
1,410,000
|
|||||||||||||||||
Executive Officer | 3/16/2009 |
400,000
|
1,880,000
|
|||||||||||||||||
George
E. Kilguss, III
|
3/25/2009
|
—
|
67,900
|
2.54
|
3/24/2019
|
|||||||||||||||
Chief
Financial Officer
|
3/25/2009
|
37,700
|
177,190
|
|||||||||||||||||
4/30/2008
|
150,000
|
705,000
|
||||||||||||||||||
Richard
J. Dobb
|
3/25/2009
|
—
|
67,400
|
2.54
|
3/24/2019
|
|||||||||||||||
Chief
Administrative
|
3/25/2009
|
37,400
|
175,780
|
|||||||||||||||||
Officer
|
3/20/2008
|
9,733
|
45,745
|
|||||||||||||||||
|
4/30/2007
|
15,000
|
70,500
|
|||||||||||||||||
3/25/2009
|
5,768
|
(4) |
27,111
|
|||||||||||||||||
3/20/2008
|
2,883
|
(5) |
13,550
|
|||||||||||||||||
Randal
R. Thompson
|
3/25/2009
|
—
|
41,900
|
2.54
|
3/24/2019
|
|||||||||||||||
Senior
Vice President,
|
3/25/2009
|
|
23,300
|
109,510
|
||||||||||||||||
Global
Sales
|
3/20/2008
|
7,849
|
36,890
|
|||||||||||||||||
11/15/2007
|
20,000
|
94,000
|
||||||||||||||||||
3/19/2007
|
1,562
|
7,341
|
||||||||||||||||||
9/28/2006
|
2,187
|
—
|
14.46
|
9/27/2016
|
||||||||||||||||
3/15/2006
|
1,250
|
5,875
|
||||||||||||||||||
1/18/2006
|
708
|
21
|
5.30
|
1/17/2016
|
||||||||||||||||
3/25/2009
|
4,651
|
(6) |
21,860
|
|||||||||||||||||
3/20/2008
|
2,326
|
(5) |
10,932
|
|||||||||||||||||
Steven
A. Orchard
|
7/14/2009
|
—
|
15,200
|
2.94
|
7/13/2019
|
|||||||||||||||
Senior
Vice President,
|
7/14/2009
|
6,200
|
29,140
|
|||||||||||||||||
Operations
and
|
3/25/2009
|
—
|
24,800
|
2.54
|
3/24/2019
|
|||||||||||||||
Support
|
3/25/2009
|
13,800
|
64,860
|
|||||||||||||||||
3/20/2008
|
1,320
|
6,204
|
||||||||||||||||||
3/19/2007
|
1,562
|
7,341
|
||||||||||||||||||
9/28/2006
|
1,794
|
—
|
14.46
|
9/27/2016
|
||||||||||||||||
3/15/2006
|
7,188
|
312
|
7.40
|
3/14/2016
|
||||||||||||||||
1/18/2006
|
685
|
15
|
5.30
|
1/17/2016
|
||||||||||||||||
12/20/2002
|
3,535
|
—
|
4.80
|
12/19/2012
|
||||||||||||||||
2/21/2002
|
450
|
—
|
11.30
|
2/20/2012
|
||||||||||||||||
12/28/2001
|
50
|
—
|
11.90
|
12/27/2011
|
||||||||||||||||
James
P. DeBlasio(7)
|
9/30/2005
|
500,000
|
—
|
4.80
|
9/29/2015
|
|||||||||||||||
Former
Chief
|
6/23/2005
|
2,000
|
—
|
4.60
|
6/22/2015
|
|||||||||||||||
Executive Officer | 5/27/2004 | 2,000 |
—
|
14.90 |
5/26/2014
|
|||||||||||||||
9/16/2003
|
25,000
|
—
|
13.50
|
9/15/2013
|
||||||||||||||||
Timothy
P. Sullivan(8)
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
|||||||||||
Former
Chief
|
||||||||||||||||||||
Technology
Officer
|
Name
and Principal Position
|
Number
of
Shares
Acquired
on
Vesting
(#)
|
Value
Realized
On
Vesting
($)
|
|||
J.
Eric Cooney
President
and Chief Executive Officer
|
—
|
—
|
|||
George
E. Kilguss III
Chief
Financial Officer
|
50,000
|
139,500
|
|||
Richard
P. Dobb
Chief
Administrative Officer
|
11,826
|
35,950
|
|||
Randal
R. Thompson
SVP,
Global Sales
|
17,239
|
52,855
|
|||
Steven
A. Orchard
SVP,
Operations and Support
|
1,836
|
6,533
|
|||
James
P. DeBlasio
Former
Chief Executive Officer
|
222,706
|
567,900
|
|||
Timothy
P. Sullivan
Former
Chief Technology Officer
|
12,081
|
32,168
|
Cash
|
Stock
Options(1)
(#)
|
Restricted
Stock(2)
(#)
|
||||||||||
Newly
appointed or elected director
|
– | – | 12,500 | |||||||||
Annual
director retainer
|
$ | 20,000 | 17,270 | (3) | 8,630 | (3) | ||||||
Board
meeting attendance fee – scheduled to be held in person
|
1,500 | – | – | |||||||||
Committee
meeting attendance fee – scheduled to be held in person
|
1,000 | – | – | |||||||||
Board
or Committee meeting attendance fee – scheduled to be held by
telephone
|
750 | – | – | |||||||||
Audit
Committee chairperson annual retainer
|
10,000 | – | – | |||||||||
Audit
Committee member annual retainer
|
5,000 | |||||||||||
Compensation
Committee chairperson annual retainer
|
7,500 | – | – | |||||||||
Compensation
Committee member annual retainer
|
2,500 | |||||||||||
Nominations
and Governance Committee chairperson annual retainer
|
5,000 | – | – | |||||||||
Chairman
annual retainer(4)
|
40,000 | – | – | |||||||||
Cash
|
Stock
Options(1)(3)
($)
|
Restricted
Stock(2)(3)
($)
|
||||||||||
Newly
appointed or elected director
|
– | – |
Number
of restricted shares equal to $75,000
|
|||||||||
Annual
director retainer
|
$ | 20,000 |
Number
of options equal to $37,500
|
Number
of restricted shares equal to $37,500
|
||||||||
Board
meeting attendance fee – scheduled to be held in person
|
1,500 | – | – | |||||||||
Committee
meeting attendance fee – scheduled to be held in person
|
1,000 | – | – | |||||||||
Board
or Committee meeting attendance fee – scheduled to be held by
telephone
|
750 | – | – | |||||||||
Audit
Committee chairperson annual retainer
|
15,000 | – | – | |||||||||
Audit
Committee member annual retainer
|
7,500 | – | – | |||||||||
Compensation
Committee chairperson annual retainer
|
10,000 | – | – | |||||||||
Compensation
Committee member annual retainer
|
5,000 | |||||||||||
Nominations
and Governance Committee chairperson annual retainer
|
7,500 | – | – | |||||||||
Chairman
annual retainer(4)
|
50,000 | – | – | |||||||||
Name
|
Fees
Earned or
Paid
in
Cash
|
Stock
Awards(1)(2)
|
Option
Awards(1)(2)
|
Total
|
||||||||||||
Eugene
Eidenberg(3)
|
$ |
50,250
|
$ |
30,291
|
$ |
37,761
|
$ |
118,302
|
||||||||
Charles
B. Coe
|
57,000
|
30,291
|
37,761
|
125,052
|
||||||||||||
William
J. Harding(4)
|
45,500
|
30,291
|
37,761
|
113,552
|
||||||||||||
Patricia
L. Higgins
|
61,250
|
30,291
|
37,761
|
129,302
|
||||||||||||
Kevin
L. Ober
|
47,750
|
30,291
|
37,761
|
115,802
|
||||||||||||
Gary
M. Pfeiffer
|
61,000
|
30,291
|
37,761
|
129,052
|
||||||||||||
Daniel
C. Stanzione(3)
|
66,500
|
30,291
|
37,761
|
134,552
|
(1) Represents the full grant date fair value of restricted stock and stock options granted in 2009, calculated in accordance with FASB ASC Topic 718. We value restricted stock using the closing price of our common stock reported on Nasdaq on the grant date. We value stock options using the Black-Scholes model. For additional valuation assumptions, see the Notes to our Consolidated Financial Statements for the fiscal year ended December 31, 2009. |
(2) The following table lists the number of outstanding stock options and restricted stock awards held by our non-employee directors as of December 31, 2009: |
Name
|
Options
(#)(a)
|
Restricted
Stock
(#)(b)
|
||||||
Eugene
Eidenberg
|
157,269
|
13,630
|
||||||
Charles
B. Coe
|
58,270
|
13,630
|
||||||
William
J. Harding(c)
|
22,270
|
833
|
||||||
Patricia
L. Higgins
|
56,270
|
18,359
|
||||||
Kevin
L. Ober
|
35,270
|
13,630
|
||||||
Gary
M. Pfeiffer
|
22,270
|
23,630
|
||||||
Daniel
C. Stanzione
|
56,270
|
13,630
|
(a)
|
All
outstanding options are fully vested.
|
|
(b)
|
Includes
all grants of restricted stock, some of which remain subject to time-based
vesting.
|
|
(c)
|
Dr.
Harding retired from our Board in October 2009. Upon his resignation, he
had three months to exercise his stock options and he forfeited all
unvested shares of restricted
stock.
|
(3) Dr. Eidenberg served as our Chairman from January 1, 2009 through June 18, 2009. Mr. Stanzione became our Chairman on June 19, 2009 and currently serves in that position. |
(4) Dr. Harding retired from our Board of Directors effective October 20, 2009. |
The
Compensation Committee
|
||
Charles
B. Coe, Chairman
|
||
Patricia
L. Higgins
|
||
Michael
A. Ruffolo
|
||
Daniel
C. Stanzione
|
●
|
accounting
and financial principles and significant assumptions, estimates and
matters of judgment used in preparing the financial
statements;
|
|
●
|
allowances
and reserves for accounts receivable, inventories and
taxes;
|
|
●
|
accounting
for acquisitions and equity-based compensation plans;
|
|
●
|
goodwill
impairment analysis; and
|
|
●
|
other
significant financial reporting issues and
practices.
|
Audit
Committee
|
|
Gary
M. Pfeiffer, Chairman
|
|
Eugene
Eidenberg
|
|
Kevin
L. Ober
|
|
Debora
J. Wilson
|
●
|
approximately
51,832,434 shares have been issued and are currently
outstanding;
|
|
●
|
approximately
4,819,154 shares are issuable upon exercise of outstanding stock options
under all of our equity plans;
|
|
●
|
approximately
1,953,625 shares remain available for grant under all of our equity
plans; and
|
|
●
|
approximately
192,708 shares remain available for purchase under our 2004 Employee Stock
Purchase Plan.
|
2009
|
2008
|
|||||||
Audit
Fees(1)
|
$ | 992,538 | $ | 2,250,926 | ||||
Audit-Related
Fees(2)
|
373,791 | 578,049 | ||||||
Tax
Fees(3)
|
122,866 | 42,265 | ||||||
All
Other Fees(4)
|
3,900 | 1,500 | ||||||
Total
|
$ | 1,493,095 | $ | 2,872,740 |
(1) Fees related to the audit of our annual financial statements, including the audit of the effectiveness of internal control over financial reporting and the reviews of the quarterly financial statements filed on Forms 10-Q. |
(2) Fees primarily related to international statutory filings. |
(3) Fees primarily related to tax compliance, advice and planning. |
(4) Fees related to services performed in conjunction with other professional services. |
C/O
AMERICAN STOCK TRANSFER
59
MAIDEN LANE
NEW
YORK, NY 10038
|
VOTE
BY INTERNET - www.proxyvote.com
|
|
Use
the Internet to transmit your voting instructions and for electronic
delivery of information up until 11:59 P.M. Eastern Time the day before
the cut-off date or meeting date. Have your proxy card in hand when you
access the web site and follow the instructions to obtain your records and
to create an electronic voting instruction form.
|
||
ELECTRONIC
DELIVERY OF FUTURE PROXY MATERIALS
|
||
If
you would like to reduce the costs incurred by Internap Network Services
in mailing proxy materials, you can consent to receiving all future proxy
statements, proxy cards and annual reports electronically via e-mail or
the Internet. To sign up for electronic delivery, please follow the
instructions above to vote using the Internet and, when prompted, indicate
that you agree to receive or access proxy materials electronically in
future years.
|
||
VOTE
BY PHONE - 1-800-690-6903
|
||
Use
any touch-tone telephone to transmit your voting instructions up until
11:59 P.M. Eastern Time the day before the cut-off date or meeting date.
Have your proxy card in hand when you call and then follow the
instructions.
|
||
VOTE
BY MAIL
|
||
Mark,
sign and date your proxy card and return it in the postage-paid envelope
we have provided or return it to Internap Network Services, c/o
Broadridge, 51 Mercedes Way, Edgewood, NY
11717.
|
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: | |||
M24527-P90963 | KEEP THIS PORTION FOR YOUR RECORDS | ||
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. | DETACH AND RETURN THIS PORTION ONLY |
INTERNAP NETWORK SERVICES CORPORATION |
For
All
|
Withhold
All
|
For All Except | To withhold authority to vote for any individual nominee(s), mark “For All Except” and write the number(s) of the nominee(s) on the line below. | ||||||||
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSALS 1, 2 AND 3. | o | o | o | |||||||||
Vote on Directors | ||||||||||||
(1) | To elect three directors to serve until the 2013 annual meeting and one director to serve until the 2011 annual meeting and until their successors are elected and qualified, or until such directors' earlier death, resignation or removal (except as indicated to the contrary on the right). | |||||||||||
01) | Kevin L. Ober for a term to expire at the 2013 annual meeting | |||||||||||
02) | Gary M. Pfeiffer for a term to expire at the 2013 annual meeting | |||||||||||
03) | Michael A. Ruffolo for a term to expire at the 2013 annual meeting | |||||||||||
04) | Debora J. Wilson for a term to expire at the 2011 annual meeting | |||||||||||
Vote on Proposals | For | Against | Abstain | |||||||||
(2) | To approve an amendment to the Company's Restated Certificate of Incorporation to increase the number of authorized shares of the Company's common stock; and | o | o | o | ||||||||
(3) |
To
ratify the appointment of PricewaterhouseCoopers LLP as the independent
registered public accounting firm of the Company for the fiscal year
ending December 31, 2010.
|
o | o | o | ||||||||
In
their discretion, the proxies are authorized to vote upon such other
business as properly may come before the annual meeting and any and all
adjournments thereof.
|
||||||||||||
This
Proxy will be voted in the manner directed by the undersigned stockholder.
If this Proxy is returned and no direction is provided by the undersigned
stockholder, this Proxy will be voted FOR ALL NOMINEES in Proposal 1,
"FOR" Proposal 2 and "FOR" Proposal 3.
|
||||||||||||
Yes | No | |||||||||||
Please indicate if you plan to attend this meeting. | o | o | ||||||||||
Signature [PLEASE SIGN WITHIN BOX] | Date | Signature (Joint Owners) | Date |
M24528-P90963 |
INTERNAP
NETWORK SERVICES CORPORATION
PROXY
SOLICITED BY THE BOARD OF DIRECTORS FOR THE
2010
ANNUAL MEETING OF STOCKHOLDERS
|
||||
Revocable Proxy | COMMON STOCK | |||
The
undersigned hereby appoints George E. Kilguss III and Richard P. Dobb, and
each of them, proxies, with full power of substitution, to act for and in
the name of the undersigned to vote all shares of common stock of Internap
Network Services Corporation (the "Company") that the undersigned is
entitled to vote at the 2010 Annual Meeting of Stockholders of the
Company, to be held on Thursday, June 17, 2010, at 10:00 a.m., Eastern
Time, at 250 Williams Street, Atlanta, Georgia, and at any and all
adjournments thereof, with all powers that the undersigned would possess
if personally present, upon and in respect of the matters listed on the
reverse side and in accordance with the instructions listed on the reverse
side, with discretionary authority as to any and all other matters that
may properly come before the meeting.
PROXY
SOLICITED BY THE BOARD OF DIRECTORS
This
proxy card will be voted as directed. If no instructions are specified,
this proxy card will be voted "FOR" Proposals 1, 2 and 3. If any other
business is presented at the annual meeting, this proxy card will be voted
by the proxies in their best judgment. At the present time, the Board of
Directors knows of no other business to be presented at the annual
meeting.
The
undersigned may elect to withdraw this proxy card at any time prior to its
use by: (i) giving written notice to the Corporate Secretary; (ii)
executing and delivering to the Corporate Secretary a duly executed proxy
card bearing a later date; or (iii) attending at the annual meeting and
voting in person.
Please
mark, date and sign exactly as your name appears on this proxy card. When
shares are held jointly, both holders should sign. When signing as
attorney, executor, administrator, trustee, guardian, or custodian, please
give your full title. If the holder is a corporation or a partnership, the
full corporate or partnership name should be signed by a duly authorized
officer.
PLEASE
COMPLETE, DATE, SIGN AND MAIL THIS PROXY CARD IN THE
ENCLOSED
POSTAGE-PAID
ENVELOPE
(Continued,
and to be signed and dated, on the reverse side)
|