CORAL GABLES, FL / ACCESSWIRE / August 22, 2017 / According to a Securities and Exchange Commission filing, via 13G/A, Towerstream (OTCQB: TWER) received an activist shareholder correspondence from HS Contrarian Investments LLC urging the company to seek strategic counsel to unlock shareholder value.

The letter is detailed below and can also be found in the company's regulatory filings.

I am the beneficial owner of 630,991 shares of common stock and $1.139 million of Preferred Stock currently convertible into 10,388,000 common shares (subject to 9.9% ownership blocker) of Towerstream Corporation (the "Company"). On a converted basis, this represents 30% of the equity. I have been a shareholder of the Company for the last two years, and very familiar with your business operations and balance sheet. I believe that the public market does not properly value the Company and the Company's shareholders deserve the opportunity to be provided a premium to prices reflected in the current market.

The internet service space has seen significant M&A activity in the past 15 months. In June 2016, Google Fiber acquired Webpass which serves 5 markets in the US and has a similar customer base and revenues as Towerstream. Since the transaction was private, the terms of the deal were not disclosed, but rumored to be more than $50 million. In addition to Webpass, there was a significant transaction in May 2017 when Verizon acquired Straight Path for $3.1 billion, an owner of spectrum rights for 5G networks. These recent transactions show that there is substantial interest from big tech companies for internet service assets.

As a shareholder, I believe that Towerstream has done a great job improving the fundamentals and it is now time for the shareholders to reap the benefits from the recent turnaround. I am requesting that the Board of Directors engage a banker for the sale of the Towerstream assets or an outright sale of the Company. Based on the quarterly filings and recent earnings announcement, it appears the Company is approximately 6 months away from breaching their debt covenants. On separate calls with legacy and current management, I have been told that the assets are worth between $60 and $100 million.

Unfortunately, the current cap table does not allow the shareholders to realize this value. Over the past two years, the Company has continued to raise equity and dilute the equity shareholders. All the EBITDA has gone to pay interest on the nearly $33 million in long term debt incurring huge losses for the Company. The Company currently has $9 million in cash and approximately 38 million shares outstanding on a fully diluted basis. At $0.08 per share, the equity is worth just $3 million. Therefore, $3 million of market cap plus $33 million of debt less the $9 million in cash gives the company an enterprise value of $27 million. This means that the common stock should be trading at $1 per share based on Management's assessment. Other Company competitors, such as Cogent Communications trades at 4x revenue. Towerstream's revenue run rate of $25 million would put the share price well over $1 per share as well.

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