Exhibit 10.4

 

 

 

FORM OF

 

AMENDED AND RESTATED

 

STOCKHOLDERS’ AGREEMENT

 

by and among

 

SK TELECOM CO., LTD.;

 

EARTHLINK, INC.;

 

and

 

HELIO, INC.

 

 

 

 

Dated as of                       , 2007

 

 

 

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THIS AMENDED AND RESTATED STOCKHOLDERS’ AGREEMENT (this “Stockholders’
Agreement”) is dated as of                          , 2007, by and among SK
Telecom Co., Ltd., a corporation with limited liability organized under the laws
of The Republic of Korea (“SKT”), EarthLink, Inc., a Delaware corporation
(“EarthLink”) and HELIO, Inc., a Delaware corporation (the “Management
Company”).

 

WHEREAS, the Management Company has authorized capital stock of two hundred
fifty million four (250,000,004) shares, consisting of two hundred thirty
million two (230,000,002) shares of Class A Common Stock, $.01 par value per
share (the “Class A Common Stock”), two (2) shares of Class B Common Stock, $.01
par value per share (the “Class B Common Stock”, and together with the Class A
Common Stock, the “Common Stock”) and twenty million (20,000,000) shares of
Preferred Stock, $.01 par value per share (the “Preferred Stock”);

 

WHEREAS, SKT Holdings, EarthLink and the Management Company are the sole members
of HELIO LLC, a Delaware limited liability company (the “Operating Company”);

 

WHEREAS, the Operating Company is a joint venture established by EarthLink and
SKT for the purpose of developing and marketing branded wireless
telecommunications services, including, but not limited to, handsets, voice
services, data services (including CDMA laptop cards and related software),
stand-alone and other wireless services within the United States;

 

WHEREAS, the parties entered into that certain Stockholders’ Agreement dated
March 24, 2005 (the “Original Agreement”); and

 

WHEREAS, the parties wish to amend and restate the Original Agreement pursuant
to the terms hereof.

 

NOW, THEREFORE, for and in consideration of the premises and mutual promises set
forth herein, the receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:

 

ARTICLE 1
DEFINITIONS

 

1.1.         CERTAIN DEFINITIONS. CAPITALIZED TERMS THAT ARE USED BUT NOT
OTHERWISE DEFINED HEREIN SHALL HAVE THE MEANINGS GIVEN TO THEM IN THE OPERATING
AGREEMENT. FOR THE PURPOSES OF THIS STOCKHOLDERS’ AGREEMENT, THE FOLLOWING TERMS
SHALL HAVE THE FOLLOWING MEANINGS:

 

“Affiliate” shall mean with respect to any Person, any Person directly or
indirectly Controlling, Controlled by, or under common Control with such other
Person at any time during the period for which the determination of affiliation
is being made.

 

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“Ancillary Agreements” shall mean, collectively, the Contribution and Formation
Agreement, the SKT Contribution Agreement, the Operating Agreement and the
Registration Rights Agreement.

 

“Bankruptcy Matter” shall mean a decision with respect to the commencement of a
voluntary case pursuant to Title 11 of the United States Bankruptcy Code, the
filing of a petition to take advantage of any other federal or state laws
relating to bankruptcy, insolvency, reorganization or composition for adjustment
of debts or the liquidation of the Operating Company or the Management Company.

 

“Beneficial Owner” shall mean a person deemed to have “Beneficial Ownership” of
any securities pursuant to Rule 13d-3 and 13d-5 under the Securities Exchange
Act of 1934, as amended, as such rules are in effect on the date of this
Stockholders’ Agreement, as well as any securities as to which such Person has
the right to become Beneficial Owner (whether such right is exercisable
immediately or only after the passage of time or the occurrence of conditions)
pursuant to any agreement, arrangement or understanding (other than customary
agreements with and between underwriters and selling group members with respect
to a bona fide public offering of securities), or upon the exercise of
conversion rights, exchange rights, rights, warrants or options, or otherwise;
provided, that no Stockholder shall be deemed the “Beneficial Owner” or to have
“Beneficial Ownership” of or to “Beneficially Own,” any Membership Units or
Shares of the other Stockholder solely by virtue of the rights set forth in this
Stockholders’ Agreement.

 

“Board of Directors” shall mean the Board of Directors of the Management
Company.

 

“Business Plan” shall have the meaning set forth in Article 1 of the Operating
Agreement.

 

“Certificate of Incorporation” shall mean the Certificate of Incorporation of
the Management Company filed with the Delaware Secretary of State, as amended or
restated from time to time.

 

“Change of Control” shall mean the transfer of Control, or sale of all or
substantially all of the assets (in one or more related transactions), of a
holder of Class B Common Stock, from the Person that holds such Control or
assets, to another Person, but shall not include a transfer of Control, or such
sale of assets, to an Affiliate of such holder of Class B Common Stock.

 

“Class A Common Stock” shall have the meaning set forth in the Recitals.

 

“Class A Director” shall have the meaning set forth in the Certificate of
Incorporation.

 

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“Class A Options” shall have the meaning set forth in Article 5.5 of the
Certificate of Incorporation.

 

“Class B Common Stock” shall have the meaning set forth in the Recitals.

 

“Class B Director” shall have the meaning set forth in the Certificate of
Incorporation.

 

“Class B Stockholders” shall mean EarthLink and SKT and any successor holder of
the shares of Class B Common Stock and any stockholder of the Management Company
that acquires one or more shares of Class B Common Stock and becomes a party
hereto by executing a joinder signature page as provided in Section 12.12
hereof.

 

“Common Stock” shall have the meaning set forth in the Recitals.

 

“Confidentiality Agreement” shall mean the confidentiality agreement entered
into by and among EarthLink, SKT, SKT Holdings, the Management Company and the
Operating Company on March 24, 2005.

 

“Contracts” shall mean all agreements, contracts, leases and subleases, purchase
orders, arrangements, commitments, non-governmental licenses, notes, mortgages,
indentures or other obligations.

 

“Contribution and Formation Agreement” shall mean the Contribution and Formation
Agreement, entered into by and among SKT, SKTI and EarthLink, as such agreement
may be amended from time to time. On March 24, 2005, SKTI assigned its rights,
liabilities and obligations under the Contribution and Formation Agreement to
SKT Holdings.

 

“Contribution Breach” shall mean a failure by SKT to make a scheduled cash
contribution to the Operating Company in accordance with the SKT Commitment.

 

“Control” as used with respect to any Entity, shall mean the possession,
directly or indirectly, of the power to direct or cause the direction of
management policies of such Entity through the ownership of voting securities or
by contract.

 

“CPR” shall have the meaning set forth in Section 11.1.2.

 

“Deadlock Matter” shall have the meaning set forth in Section 8.2.

 

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“Directors” shall mean the directors serving on the Board of Directors of the
Management Company.

 

 “EarthLink” shall have the meaning set forth in the introductory paragraph.

 

“Entity” shall mean any corporation, firm, unincorporated organization,
association, partnership, limited partnership, limited liability company,
limited liability partnership, business trust, joint stock company, joint
venture organization, entity or business.

 

“First Party” shall have the meaning set forth in Section 5.3.

 

“Governmental Entity” shall mean any governmental or regulatory authority,
court, agency, commission, body or other similar entity.

 

“ICC” shall have the meaning set forth in Section 11.1.3.

 

“JV Securities” shall mean the Shares and the Membership Units.

 

“Lock-in Period” shall have the meaning set forth in Section 5.1.1.

 

“M&A Transaction” shall mean a sale in a merger, consolidation, share exchange,
combination or other similar transaction, of at least eighty percent (80%) of:
(a) the outstanding JV Securities, or (b) the assets of the Operating Company
and the Management Company (measured in terms of the fair market value of the
assets of the Operating Company or the Management Company, as applicable).

 

“Management Company” shall have the meaning set forth in the introductory
paragraph and shall include any other successor Management Company selected in
accordance with the terms of the Operating Agreement.

 

“Material Adverse Effect” shall have the meaning set forth in the Contribution
and Formation Agreement.

 

“MVNO Services” shall have the meaning set forth in Section 6.7.2.

 

“Membership Units” shall have the meaning set forth in the Operating Agreement.

 

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“Operating Agreement” shall mean that certain Limited Liability Company
Agreement, by and among EarthLink, SKT Holdings, Operating Company and
Management Company, as such agreement may be amended from time to time.

 

“Operating Company” shall have the meaning set forth in the Recitals.

 

“Operating Company Products and Services” shall have the meaning set forth in
Article 1 of the Operating Agreement.

 

“Original Agreement” shall have the meaning set forth in the Recitals.

 

“Parent Entity” shall mean, with respect to any Entity that is a Subsidiary of a
Person, the Person that, directly or indirectly, Beneficially Owns at least
fifty percent (50%) of the equity of such Subsidiary and is not a Subsidiary of
any Person.

 

“Percentage Interest” shall mean a Stockholder’s percentage interest in the
Total Outstanding Shares as determined by dividing the number of Total
Outstanding Shares owned by such Stockholder or any Subsidiary or Parent Entity
of such Stockholder by the number of Total Outstanding Shares then owned by all
Stockholders (including all Subsidiaries or Parent Entities of such
Stockholders). The Percentage Interests owned by the Class B Stockholders as of
the date hereof are set forth on Addendum 1 to Schedule 9.1.1 of the Operating
Agreement.

 

“Permitted Transfers” shall have the meaning set forth in Section 5.1.2.

 

“Person” shall mean any natural person or Entity.

 

“Preferred Stock” shall have the meaning set forth in the Recitals.

 

“Provider” shall have the meaning set forth in Section 6.5.

 

“Public Common Stock” shall mean the Class A Common Stock that has been
registered with the Securities and Exchange Commission for sale to the public.

 

“Public Offering” shall mean a sale of Public Common Stock to underwriters in a
bona fide, firm commitment underwriting pursuant to a registration statement on
Form S-1, SB-2 or S-3 (or successor forms) under the Securities Act.

 

“Recommended Transaction” shall have the meaning set forth in Section 5.6.

 

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“Registration Rights Agreement” shall mean the Registration Rights Agreement
entered into by and among SKT, EarthLink and the Management Company as of March
24, 2005.

 

“Restricted Services” shall have the meaning set forth in Section 6.1.

 

“Right of First Refusal” shall have the meaning set forth in Section 5.3.

 

“ROFR Percentage Interest” shall mean the percentage as determined by dividing
the number of Total Outstanding Shares owned by SKT or any Subsidiary or Parent
Entity of SKT by the number of Total Outstanding Shares then owned by all Class
B Stockholders and Subsidiaries and Parent Entities of Class B Stockholders, but
excluding the shares owned by the First Party.

 

“ROFR Termination Date” shall have the meaning set forth in Section 5.3.

 

“Second Party” shall have the meaning set forth in Section 5.4.

 

“Securities Act” shall have the meaning set forth in Section 9.1.

 

“Shares” shall mean the issued and outstanding Common Stock and Preferred Stock.

 

“SKT” shall have the meaning set forth in the introductory paragraph.

 

“SKT Commitment” shall have the meaning set forth in Section 9.1.2 of the
Operating Agreement.

 

“SKT Contribution Agreement” shall mean the Contribution Agreement dated
November 7, 2007, between EarthLink, SKT Holdings and the Operating Company.

 

“SKTI” shall mean SK Telecom International, Inc.

 

“SKT Holdings” shall mean SK Telecom USA Holdings, Inc.

 

“SKT Triggering Contribution” shall have the meaning set forth in Section 9.1.2
of the Operating Agreement.

 

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“Stockholders” shall mean EarthLink and SKT and the successors of each and any
stockholder of the Management Company that acquires one or more Shares and
becomes a party hereto by executing a joinder signature page as provided in
Section 12.12 hereof.

 

“Stockholders’ Agreement” shall have the meaning set forth in the Recitals.

 

“Strategic Decision” shall have the meaning set forth in Section 8.1.

 

“Subject Interest” shall have the meaning set forth in Section 5.3.

 

“Subject Stockholders” shall have the meaning set forth in Section 5.6.

 

“Subsidiary” shall mean, as to any Person, any Entity (i) of which such Person,
directly or indirectly, owns securities or other equity interests representing
fifty percent (50%) or more of the aggregate voting power or (ii) of which such
Person possesses the right to elect fifty percent (50%) or more of the directors
or Persons holding similar positions. The Operating Company shall be deemed to
be a Subsidiary of the Management Company. Neither the Operating Company nor the
Management Company shall be deemed to be a Subsidiary of any Stockholder.

 

“Tag-along Right” shall have the meaning set forth in Section 5.4.

 

“Tag-along Election Notice” shall have the meaning set forth in Section 5.4.

 

“Tag-along Transfer Notice” shall have the meaning set forth in Section 5.4.

 

“Third Party” shall mean any Person other than EarthLink, SKT Holdings, SKT or
the Operating Company, the Management Company or any Affiliate of the foregoing.

 

“Total Outstanding Shares” shall mean, from time to time, the sum of (a) the
number of shares of Class A Common Stock issued and outstanding and (b) the
number of shares of Class A Common Stock obtained if all issued and outstanding
shares of Class B Common Stock, Membership Units and shares of convertible
Preferred Stock were then converted into shares of Class A Common Stock in
accordance with Articles 5.1, 5.2 and 5.4, respectively, of the Certificate of
Incorporation.

 

“Transfer” shall mean any direct or indirect sale, transfer, assignment, pledge,
hypothecation, mortgage or other disposition or encumbrance, of any beneficial
or economic interest in any JV Securities, including those by operation or
succession of law, merger or

 

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otherwise. A Transfer of JV Securities shall be deemed to have occurred upon any
transfer of the stock of a Subsidiary holding the JV Securities that results in
such Entity no longer being a Subsidiary of a Stockholder. However, a Change of
Control of a holder of Class B Common Stock shall not be deemed to be a
Transfer.

 

“Transfer Notice” shall have the meaning set forth in Section 5.3.

 

“Triggering Event” shall have the meaning set forth in Article 5 of the
Certificate of Incorporation.

 

“VOIP” shall mean voice over Internet protocol.

 

“VoWiFi” shall mean voice over WiFi.

 

“Wimax Enabled Devices” shall have the meaning set forth in Section 6.3.

 

Except as expressly provided herein, whenever in this Stockholders’ Agreement
there shall be a reference to any Ancillary Agreement or this Stockholders’
Agreement, such reference shall be deemed to refer to such agreement as it may
be amended from time to time.

 

ARTICLE 2
REPRESENTATIONS AND WARRANTIES

 

Each Stockholder represents and warrants to the other Stockholder and the
Management Company that:

 

2.1.         CORPORATE AUTHORITY. IT HAS ALL REQUISITE CORPORATE OR LIMITED
LIABILITY COMPANY POWER AND AUTHORITY AND HAS TAKEN ALL CORPORATE OR LIMITED
LIABILITY COMPANY ACTION NECESSARY IN ORDER TO EXECUTE AND DELIVER THIS
STOCKHOLDERS’ AGREEMENT AND TO PERFORM FULLY ITS OBLIGATIONS HEREUNDER.

 

2.2.         ENCUMBRANCES. SUCH STOCKHOLDER OWNS THAT NUMBER OF ISSUED AND
OUTSTANDING SHARES OF CLASS A COMMON STOCK AND/OR CLASS B COMMON STOCK AS SET
FORTH IN SCHEDULE 2.2 HERETO, FREE AND CLEAR OF ALL LIENS AND ENCUMBRANCES,
EXCEPT FOR THIS STOCKHOLDERS’ AGREEMENT AND THE OPERATING AGREEMENT. THERE ARE
NO OPTIONS, WARRANTS OR OTHER RIGHTS, AGREEMENTS, ARRANGEMENTS OR COMMITMENTS OF
ANY CHARACTER TO WHICH SUCH STOCKHOLDER IS A PARTY RELATING TO THE PLEDGE,
DISPOSITION OR VOTING OF ANY SHARES AND THERE ARE NO VOTING TRUSTS OR VOTING
AGREEMENTS WITH RESPECT TO SUCH SHARES.

 

2.3.         BINDING AGREEMENT. THIS STOCKHOLDERS’ AGREEMENT HAS BEEN DULY
EXECUTED AND DELIVERED AND IS A VALID AND BINDING AGREEMENT OF SUCH STOCKHOLDER
ENFORCEABLE AGAINST IT IN

 

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ACCORDANCE WITH ITS TERMS, SUBJECT TO BANKRUPTCY, INSOLVENCY, FRAUDULENT
TRANSFER, REORGANIZATION, MORATORIUM AND SIMILAR LAWS OF GENERAL APPLICABILITY
RELATING TO OR AFFECTING CREDITOR’S RIGHTS AND TO GENERAL EQUITY PRINCIPLES.

 

2.4.         NOTICES, REPORTS AND FILINGS. NO NOTICES, REPORTS OR OTHER FILINGS
ARE REQUIRED TO BE MADE BY SUCH STOCKHOLDER WITH, NOR ARE ANY CONSENTS,
REGISTRATIONS, APPROVALS, PERMITS OR AUTHORIZATIONS REQUIRED TO BE OBTAINED BY
IT OR THE MANAGEMENT COMPANY FROM, ANY GOVERNMENTAL ENTITY, IN CONNECTION WITH
THE EXECUTION AND DELIVERY OF THIS STOCKHOLDERS’ AGREEMENT, EXCEPT THOSE THAT
HAVE BEEN MADE OR OBTAINED OR THAT THE FAILURE TO MAKE OR OBTAIN ARE NOT,
INDIVIDUALLY OR IN THE AGGREGATE, REASONABLY LIKELY TO RESULT IN A MATERIAL
ADVERSE EFFECT ON THE OPERATING COMPANY.

 

2.5.         NON-CONTRAVENTION. THE EXECUTION, DELIVERY AND PERFORMANCE OF THIS
STOCKHOLDERS’ AGREEMENT BY SUCH STOCKHOLDER DOES NOT, AND THE CONSUMMATION BY IT
OF THE TRANSACTIONS CONTEMPLATED HEREBY WILL NOT, CONSTITUTE OR RESULT IN (A) A
BREACH OR VIOLATION OF, OR A DEFAULT UNDER, ITS ORGANIZATIONAL DOCUMENTS, (A) A
BREACH OF OR VIOLATION OF OR DEFAULT UNDER, OR THE ACCELERATION OF ANY
OBLIGATIONS OF OR THE CREATION OF A LIEN OR ENCUMBRANCE ON ITS ASSETS (WITH OR
WITHOUT NOTICE, LAPSE OF TIME OR BOTH) PURSUANT TO ANY CONTRACTS BINDING UPON IT
OR ANY LAW, STATUTE OR REGULATION OR GOVERNMENTAL OR NON-GOVERNMENTAL PERMIT OR
LICENSE TO WHICH IT IS SUBJECT OR (C) ANY CHANGE IN THE RIGHTS OR OBLIGATIONS OF
ANY PARTY UNDER ANY OF SUCH CONTRACTS TO WHICH IT IS A PARTY, EXCEPT, IN THE
CASE OF CLAUSE (B) OR (C) ABOVE, FOR ANY BREACH, VIOLATION, DEFAULT,
ACCELERATION, CREATION OR CHANGE THAT INDIVIDUALLY OR IN THE AGGREGATE, IS NOT
REASONABLY LIKELY TO (X) RESULT IN A MATERIAL ADVERSE EFFECT ON THE OPERATING
COMPANY.

 

ARTICLE 3
VOTING

 

3.1.         VOTING AGREEMENTS. EACH STOCKHOLDER AGREES TO VOTE OR CAUSE THE
VOTING OF, WHETHER IN PERSON, BY PROXY OR WRITTEN CONSENT, ALL SHARES, DIRECTLY
OR INDIRECTLY, BENEFICIALLY OWNED BY IT SO AS TO CAUSE THE EVENTS SET FORTH IN
THIS SECTION 3.1 TO OCCUR:

 

3.1.1       ELECTION OF CLASS B DIRECTORS. THE ELECTION OF CLASS B DIRECTORS AS
PROVIDED FOR IN ARTICLE 6 OF THE CERTIFICATE OF INCORPORATION.

 

3.1.2       REMOVAL OF CLASS B DIRECTORS. THE REMOVAL OF ANY CLASS B DIRECTOR,
UPON THE REQUEST OF THE STOCKHOLDER ENTITLED TO ELECT SUCH CLASS B DIRECTOR.

 

3.1.3       REPLACEMENT OF CLASS B DIRECTORS. THE APPOINTMENT OF A NEW CLASS B
DIRECTOR, TO FILL ANY VACANCY IN THE CLASS B DIRECTORS ON THE BOARD OF DIRECTORS
OR ANY COMMITTEE OF THE BOARD OF DIRECTORS, AS DETERMINED BY THE STOCKHOLDER
ENTITLED TO ELECT SUCH CLASS B DIRECTOR WHOSE DEPARTURE HAS CAUSED THE VACANCY.

 

3.1.4       ELECTION OF INDEPENDENT DIRECTORS. FOLLOWING AN INITIAL PUBLIC
OFFERING, THE ELECTION OF SUCH INDEPENDENT CLASS A DIRECTORS AS ARE REQUIRED BY
ARTICLE 6 OF THE CERTIFICATE OF INCORPORATION.

 

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3.1.5       PAYMENT OF DIVIDENDS. TO THE EXTENT THAT THE MANAGEMENT COMPANY
RECEIVES DISTRIBUTIONS AS A MEMBER OF THE OPERATING COMPANY AND TO THE EXTENT
PERMITTED BY APPLICABLE LAW, THE PAYMENT OF A DIVIDEND IN THE AMOUNT OF THE NET
DISTRIBUTIONS RECEIVED FROM THE OPERATING COMPANY TO THE HOLDERS OF SHARES OF
COMMON STOCK, SUBJECT TO (I) ANY PREFERENTIAL RIGHTS OF HOLDERS OF PREFERRED
STOCK, AND (II) ANY RESTRICTIONS OR LIMITATIONS UNDER ANY CREDIT FACILITY OR
OTHER LOAN DOCUMENT IN RESPECT OF BORROWED MONEY.

 

3.1.6       CONVERSION AND EXCHANGE. ALL MATTERS NECESSARY TO FACILITATE THE
CONVERSION OF A STOCKHOLDER’S CLASS B COMMON STOCK, CONVERTIBLE PREFERRED STOCK
AND EXCHANGE OF MEMBERSHIP UNITS FOR SHARES OF CLASS A COMMON STOCK, EACH AS
PROVIDED FOR IN THE CERTIFICATE OF INCORPORATION.

 

3.1.7       PUBLIC OFFERING. ALL MATTERS NECESSARY TO FACILITATE THE
REGISTRATION, ISSUANCE AND SALE OF SHARES OF CLASS A COMMON STOCK IN A PUBLIC
OFFERING, AS PROVIDED FOR IN THE CERTIFICATE OF INCORPORATION, OPERATING
AGREEMENT AND REGISTRATION RIGHTS AGREEMENT, AND TO GIVE EFFECT TO THE
CONTRIBUTION, TO THE OPERATING COMPANY, OF THE NET PROCEEDS RECEIVED FROM SUCH
PUBLIC OFFERING OF CLASS A COMMON STOCK.

 

3.1.8       SOLICITATION OF AN M&A TRANSACTION. ALL MATTERS NECESSARY TO
FACILITATE THE SOLICITATION OR EXPLORATION OF AN M&A TRANSACTION, INCLUDING,
WITHOUT LIMITATION, THE ENGAGEMENT OR RETENTION OF ACCOUNTANTS, INVESTMENT
BANKS, ATTORNEYS AND SIMILAR PROFESSIONALS IN CONNECTION THEREWITH (THE FEES FOR
WHICH SHALL BE PAID BY THE OPERATING COMPANY).

 

3.2.         VOTING OF IRREVOCABLE PROXIES. EACH OF SKT AND EARTHLINK HAVE BEEN
GRANTED IRREVOCABLE PROXIES FROM CERTAIN STOCKHOLDERS OF THE MANAGEMENT COMPANY
TO VOTE 50% OF SUCH STOCKHOLDERS’ SHARES (COLLECTIVELY, THE “PROXY SHARES”).
NOTWITHSTANDING THE TERMS OF THE IRREVOCABLE PROXIES, SKT AND EARTHLINK AGREE TO
VOTE OR CAUSE THE VOTING OF, WHETHER IN PERSON, BY PROXY OR WRITTEN CONSENT, THE
PROXY SHARES IN ACCORDANCE WITH THE PERCENTAGE OWNERSHIP OF EACH CLASS B
STOCKHOLDER THAT IS NOT A TRIGGERING PARTY (AS DEFINED IN THE CERTIFICATE OF
INCORPORATION).

 

ARTICLE 4
ADDITIONAL AGREEMENTS

 

4.1.         STANDSTILL. THE STOCKHOLDERS AND THEIR SUBSIDIARIES SHALL NOT TAKE
ANY OF THE FOLLOWING ACTIONS WITHOUT THE PRIOR WRITTEN CONSENT OF THE OTHER
STOCKHOLDER OR THE BOARD OF DIRECTORS, AS APPROPRIATE:

 

(A)                                  ACQUIRE OR SEEK TO ACQUIRE BENEFICIAL
OWNERSHIP OF ANY SECURITIES, INCLUDING RIGHTS OR OPTIONS, OF THE OTHER
STOCKHOLDER OR THE OPERATING COMPANY, EXCEPT AS PERMITTED BY THE OPERATING
AGREEMENT;

 

(B)                                 PROPOSE TO ENTER INTO ANY MERGER, PURCHASE
OF SUBSTANTIALLY ALL THE ASSETS OR ANY OTHER BUSINESS COMBINATION INVOLVING THE
OTHER STOCKHOLDER;

 

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(C)                                  PARTICIPATE IN ANY SOLICITATION OF PROXIES
TO VOTE, OR SEEK TO ADVISE ANY PERSON WITH RESPECT TO THE VOTING OF, ANY
SECURITIES OF THE OTHER STOCKHOLDER; PROPOSE ANY STOCKHOLDER PROPOSALS FOR
SUBMISSION TO A VOTE OF STOCKHOLDERS OF THE OTHER STOCKHOLDER, OR PROPOSE ANY
PERSON FOR ELECTION TO, OR THE REMOVAL OF ANY MEMBER FROM, THE BOARD OF
DIRECTORS OF THE OTHER STOCKHOLDER; OR IN ANY WAY SEEK TO INFLUENCE THE
MANAGEMENT OR POLICIES OF THE OTHER STOCKHOLDER; OR

 

(D)                                 ENTER INTO ANY DISCUSSIONS OR UNDERSTANDINGS
WITH ANY THIRD PARTY, WHICH, IF CONCLUDED BY ANY ACTION, WOULD RESULT IN A
VIOLATION OF THE FOREGOING.

 

The foregoing obligations of the Stockholders shall terminate upon one (1) year
after the earlier of: (a) the dissolution of the Operating Company, or (b) the
Transfer or conversion by any Stockholder of its Class B Common Stock.

 

4.2.         COMPOSITION OF THE BOARD. IF NECESSARY, THE COMPOSITION OF THE
BOARD OF DIRECTORS SHALL BE ADJUSTED, TO THE EXTENT NECESSARY, TO ENSURE THE
ONGOING COMPLIANCE WITH THE SARBANES-OXLEY ACT AND THE RULES AND REGULATIONS OF
ANY STOCK EXCHANGE ON WHICH THE MANAGEMENT COMPANY’S CLASS A COMMON STOCK MAY BE
TRADED. THE STOCKHOLDERS AGREE TO VOTE THEIR STOCK IN FAVOR OF ANY SUCH
ADJUSTMENTS TO THE COMPOSITION OF THE BOARD OF DIRECTORS.

 

4.3.         [RESERVED].

 

4.4.         INSURANCE. THE MANAGEMENT COMPANY SHALL PURCHASE AND MAINTAIN
INSURANCE COVERAGE ADEQUATE TO COVER RISKS OF SUCH TYPES AND IN SUCH AMOUNTS AS
ARE CUSTOMARY FOR COMPANIES OF SIMILAR SIZE ENGAGED IN SIMILAR LINES OF
BUSINESS, INCLUDING, WITHOUT LIMITATION, LIABILITY INSURANCE FOR THE BENEFIT OF
ITS EMPLOYEES, DIRECTORS AND OFFICERS WITH RESPECT TO CLAIMS AGAINST SUCH
EMPLOYEES, DIRECTORS AND OFFICERS IN THEIR CAPACITY AS EMPLOYEES, DIRECTORS AND
OFFICERS IN SUCH AMOUNTS AS THE MANAGEMENT COMPANY SHALL DETERMINE ARE ADEQUATE.

 

ARTICLE 5
TRANSFER RESTRICTIONS

 

5.1.         TRANSFER RESTRICTIONS. UNTIL SUCH TIME AS A TRIGGERING EVENT (AS
DEFINED IN ARTICLE 5 OF THE CERTIFICATE OF INCORPORATION) SHALL OCCUR, EACH
STOCKHOLDER AGREES THAT IT AND ITS SUBSIDIARIES AND PARENT ENTITIES SHALL NOT
TRANSFER OR PERMIT ANY TRANSFER, IN ANY SINGLE TRANSACTION OR SERIES OF RELATED
TRANSACTIONS, ANY JV SECURITIES THAT ARE, DIRECTLY OR INDIRECTLY, BENEFICIALLY
OWNED BY IT, EXCEPT IN ACCORDANCE WITH THE TERMS OF THIS STOCKHOLDERS’ AGREEMENT
AND THE OPERATING AGREEMENT. ANY TRANSFER OF ANY JV SECURITIES OTHER THAN IN
ACCORDANCE WITH THIS STOCKHOLDERS’ AGREEMENT AND THE OPERATING AGREEMENT SHALL
BE NULL AND VOID.

 

5.1.1       LOCK-IN PERIOD. PRIOR TO MARCH 24, 2008 (THE “LOCK-IN PERIOD”), THE
STOCKHOLDERS AND THEIR SUBSIDIARIES AND PARENT ENTITIES SHALL NOT TRANSFER OR
SOLICIT ANY TRANSFER OF ANY JV SECURITIES WITHOUT THE PRIOR WRITTEN CONSENT OF
THE NON-TRANSFERRING CLASS B STOCKHOLDER, WHICH CANNOT BE UNREASONABLY WITHHELD
OR DELAYED. AFTER THE EXPIRATION OF THE

 

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LOCK-IN PERIOD, THE STOCKHOLDERS AND THEIR SUBSIDIARIES MAY, SUBJECT TO THE
RESTRICTIONS ON TRANSFER CONTAINED IN THIS ARTICLE 5 OR IN THE OPERATING
AGREEMENT, TRANSFER ALL OR ANY PORTION OF THEIR JV SECURITIES TO A THIRD PARTY
WITHOUT THE NECESSITY OF OBTAINING THE PRIOR WRITTEN CONSENT OF THE CLASS B
STOCKHOLDER(S).

 

5.1.2       PERMITTED TRANSFERS. NOTWITHSTANDING ANYTHING IN SECTION 5.1.1 TO
THE CONTRARY, THE FOLLOWING TRANSFERS OF JV SECURITIES WILL BE PERMITTED (THE
“PERMITTED TRANSFERS”) WITHOUT THE NECESSITY OF OBTAINING THE WRITTEN CONSENT OF
THE CLASS B STOCKHOLDERS:

 

(A)                                  A TRANSFER TO A PARENT ENTITY (TO WHICH THE
STOCKHOLDER IS A WHOLLY-OWNED SUBSIDIARY) OR A WHOLLY-OWNED SUBSIDIARY OF THE
STOCKHOLDER;

 

(B)                                 A TRANSFER IN CONNECTION WITH AN
UNDERWRITTEN PUBLIC OFFERING AS A SELLING STOCKHOLDER;

 

(C)                                  A TRANSFER TO THE OPERATING COMPANY OR THE
MANAGEMENT COMPANY; AND

 

(D)                                 A PLEDGE TO A FINANCIAL INSTITUTION IN
CONNECTION WITH A BORROWING SECURED BY, A STOCKHOLDER’S JV SECURITIES TOGETHER
WITH SUBSTANTIALLY ALL OF THAT STOCKHOLDER’S OTHER ASSETS.

 

5.1.3       AGREEMENT TO BE BOUND. IN ALL CIRCUMSTANCES OTHER THAN THOSE
DESCRIBED IN SECTION 5.1.2(B), A TRANSFER OF JV SECURITIES OR CONVERSION OF
MEMBERSHIP UNITS OR SHARES OF CONVERTIBLE PREFERRED STOCK INTO SHARES OF CLASS A
COMMON STOCK SHALL BE GIVEN EFFECT BY THE MANAGEMENT COMPANY OR THE OPERATING
COMPANY ONLY UPON RECEIPT OF THE WRITTEN AGREEMENT OF THE RECIPIENT OF THE
TRANSFERRED JV SECURITIES AGREEING TO BE BOUND BY THE TERMS AND CONDITIONS OF
THIS STOCKHOLDERS’ AGREEMENT OR THE OPERATING AGREEMENT, AS THE CASE MAY BE, AND
THE CONFIDENTIALITY AGREEMENT.

 

5.1.4       EFFECT OF TRANSFER. UPON ANY TRANSFER OF ALL OF A STOCKHOLDER’S JV
SECURITIES, THE TRANSFERRING STOCKHOLDER WILL HAVE NO CONTINUING RIGHTS OR
OBLIGATIONS UNDER THIS STOCKHOLDER’S AGREEMENT OR THE OPERATING AGREEMENT BUT
SHALL CONTINUE TO BE BOUND BY ANY ANCILLARY AGREEMENTS TO WHICH IT IS A PARTY,
IN ACCORDANCE WITH THEIR TERMS.

 

5.2.         [RESERVED]

 

5.3.         RIGHT OF FIRST REFUSAL. SUBJECT TO SECTION 5.5, IF A STOCKHOLDER
(THE “FIRST PARTY”) RECEIVES A BONA-FIDE WRITTEN OFFER BY A THIRD PARTY TO
PURCHASE ALL OR A PORTION OF THE FIRST PARTY’S SHARES (THE “SUBJECT INTEREST”)
THAT THE FIRST PARTY DESIRES TO ACCEPT, THE FIRST PARTY SHALL PROMPTLY AFTER
RECEIPT OF THE OFFER DELIVER NOTICE (THE “TRANSFER NOTICE”) TO THE MANAGEMENT
COMPANY AND SKT STATING THAT THE FIRST PARTY PROPOSES TO TRANSFER THE SUBJECT
INTEREST. THE TRANSFER NOTICE SHALL (I) SPECIFY THE PURCHASE PRICE AND OTHER
MATERIAL TERMS OF THE TRANSFER OF THE SUBJECT INTEREST, (II) IDENTIFY THE
PROPOSED PURCHASER, (III) SPECIFY THE DATE SCHEDULED FOR THE TRANSFER (WHICH
DATE SHALL NOT BE LESS THAN NINETY (90) DAYS AFTER THE DATE THE TRANSFER NOTICE
IS DELIVERED) AND (IV) HAVE ATTACHED THERETO A COPY OF THE BONA FIDE OFFER AND
ANY ANCILLARY AGREEMENTS CONTAINING TERMS AND CONDITIONS OF THE SALE OF THE
SUBJECT INTEREST. WITHIN

 

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SIXTY (60) DAYS AFTER RECEIPT OF A TRANSFER NOTICE, SKT WILL HAVE THE RIGHT TO
ELECT TO PURCHASE A PORTION OF THE SUBJECT INTEREST BEING SOLD EQUAL TO THEIR
RESPECTIVE ROFR PERCENTAGE INTERESTS (A “RIGHT OF FIRST REFUSAL”), ON TERMS AND
CONDITIONS NO LESS FAVORABLE TO THE FIRST PARTY THAN THOSE SET FORTH IN THE
TRANSFER NOTICE; PROVIDED, THAT IF SUCH TERMS AND CONDITIONS INCLUDE NON-CASH
ASSETS OR NONFINANCIAL REQUIREMENTS THAT WOULD BE IMPRACTICABLE TO SATISFY, THEN
SKT SHALL NOT BE REQUIRED TO SATISFY SUCH TERMS, CONDITIONS AND REQUIREMENTS,
AND THE PURCHASE PRICE FOR THE SUBJECT INTEREST WILL INCLUDE AN AMOUNT EQUAL TO
THE FAIR MARKET VALUE OF SUCH NON-CASH ASSETS. IF SKT ELECTS TO PURCHASE THE
SUBJECT INTEREST, THE FIRST PARTY AND SKT SHALL USE REASONABLE EFFORTS TO
CONSUMMATE THE CLOSING OF THE PURCHASE OF THE SUBJECT INTEREST AS SOON AS
REASONABLY PRACTICABLE AND IN ANY EVENT WITHIN ONE HUNDRED TWENTY (120) CALENDAR
DAYS AFTER RECEIPT OF THE TRANSFER NOTICE (THE “ROFR TERMINATION DATE”),
PROVIDED, THAT IF THE CLOSING DOES NOT OCCUR BY THEN DUE TO THE FAILURE TO
RECEIVE ANY REQUIRED REGULATORY APPROVALS OR CONSENTS, THE ROFR TERMINATION DATE
MAY BE EXTENDED BY EITHER THE FIRST PARTY OR SKT UNTIL SUCH APPROVALS ARE
RECEIVED, BUT IN NO EVENT FOR A PERIOD OF MORE THAN ONE HUNDRED EIGHTY (180)
CALENDAR DAYS AFTER RECEIPT OF THE TRANSFER NOTICE. IF THE RIGHT OF FIRST
REFUSAL IS NOT EXERCISED BY SKT AS TO THE ENTIRE SUBJECT INTEREST WITHIN SIXTY
(60) DAYS OF RECEIPT OF THE TRANSFER NOTICE OR THE ENTIRE SUBJECT INTEREST IS
NOT PURCHASED FROM THE FIRST PARTY PRIOR TO THE ROFR TERMINATION DATE, AS
ADJUSTED FOR ANY EXTENSION THERETO, THEN THE FIRST PARTY MAY SELL THE SUBJECT
INTEREST TO THE PROPOSED PURCHASER IDENTIFIED IN THE TRANSFER NOTICE ON THE
TERMS SET FORTH THEREIN, SUBJECT TO THE TAG-ALONG RIGHT OF SKT PROVIDED IN
SECTION 5.4 BELOW. IF SKT AGREES TO PURCHASE ANY PORTION OF THE SUBJECT INTEREST
IN ACCORDANCE WITH THE FOREGOING AND FAILS TO COMPLETE THE PURCHASE OF SUCH
PORTION OF THE SUBJECT INTEREST PRIOR TO THE ROFR TERMINATION DATE, OTHER THAN
AS A RESULT OF A DENIAL OF ANY REQUIRED REGULATORY APPROVALS OR CONSENTS, THEN
SKT SHALL BE DEEMED TO HAVE BREACHED THIS STOCKHOLDERS’ AGREEMENT AND, IN
ADDITION TO ANY OTHER RIGHT OR REMEDY AVAILABLE TO THE FIRST PARTY OR THE
MANAGEMENT COMPANY, SHALL BE DEEMED TO HAVE FORFEITED ITS TAG-ALONG RIGHT UNDER
SECTION 5.4 IN CONNECTION WITH THE FIRST PARTY’S RIGHT TO SELL THE SUBJECT
INTEREST TO THE THIRD PARTY NAMED IN THE TRANSFER NOTICE. THE ABOVE RIGHT OF
FIRST REFUSAL SHALL NOT APPLY TO A TRANSACTION WHICH CONSTITUTES A CHANGE OF
CONTROL OF A CLASS B STOCKHOLDER.

 

5.4.         TAG-ALONG RIGHT. IF (I) THE RIGHT OF FIRST REFUSAL IS NOT EXERCISED
BY SKT AS TO THE ENTIRE SUBJECT INTEREST WITHIN SIXTY (60) DAYS OF RECEIPT OF
THE TRANSFER NOTICE OR THE ENTIRE SUBJECT INTEREST IS NOT PURCHASED FROM THE
FIRST PARTY ON OR BEFORE THE ROFR TERMINATION DATE, AS IT MAY HAVE BEEN EXTENDED
OR (II) SKT RECEIVES A BONA-FIDE WRITTEN OFFER BY A THIRD PARTY TO PURCHASE
SKT’S SUBJECT INTEREST THAT SKT DESIRES TO ACCEPT, THEN THE FIRST PARTY OR SKT,
AS APPLICABLE, SHALL PROMPTLY DELIVER WRITTEN NOTICE THEREOF (“TAG-ALONG
TRANSFER NOTICE”) TO ANY NON-TRANSFERRING CLASS B STOCKHOLDER (EACH
NON-TRANSFERRING CLASS B STOCKHOLDER A “SECOND PARTY” AND COLLECTIVELY, THE
“SECOND PARTIES”) AND EACH SECOND PARTY WILL HAVE THE RIGHT TO SELL TO THE
THIRD-PARTY PURCHASER IDENTIFIED IN THE TAG-ALONG TRANSFER NOTICE A PORTION OF
THE SUBJECT INTEREST, FROM SUCH SECOND PARTY’S SHARES, EQUAL TO THE SUBJECT
INTEREST MULTIPLIED BY SUCH SECOND PARTY’S PERCENTAGE INTEREST (“TAG-ALONG
RIGHT”); PROVIDED THAT NO SECOND PARTY THAT HAS BREACHED ITS OBLIGATIONS UNDER
SECTION 5.3 WITH RESPECT TO ANY SUBJECT INTEREST MAY EXERCISE ANY TAG-ALONG
RIGHT WITH RESPECT TO SUCH SUBJECT INTEREST. A SECOND PARTY ELECTING TO EXERCISE
ITS TAG-ALONG RIGHT SHALL PROVIDE TO THE OPERATING COMPANY AND THE FIRST PARTY
WRITTEN NOTICE OF SUCH ELECTION (THE “TAG-ALONG ELECTION NOTICE”) WITHIN SUCH
SIXTY (60) DAY PERIOD. THE TAG-ALONG ELECTION NOTICE SHALL SPECIFY THE NUMBER OF
SHARES TO BE INCLUDED IN THE SALE TO THE THIRD-PARTY PURCHASER. ANY SALE
PURSUANT TO THIS SECTION 5.4 SHALL BE CONSUMMATED NOT LATER THAN SIXTY (60) DAYS
FOLLOWING DELIVERY OF THE TAG-ALONG ELECTION NOTICE.

 

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5.5.         LIMITATION ON THE RIGHT OF FIRST REFUSAL AND TAG-ALONG RIGHT. THE
RIGHT OF FIRST REFUSAL AND TAG-ALONG RIGHT DESCRIBED IN SECTIONS 5.3 AND 5.4,
ABOVE, SHALL NOT APPLY TO PERMITTED TRANSFERS. THE RIGHT OF FIRST REFUSAL AND
THE TAG-ALONG RIGHT SHALL TERMINATE UPON A PUBLIC OFFERING OF THE CLASS A COMMON
STOCK AND THE AVAILABILITY OF RULE 144 TO STOCKHOLDERS FOR THE TRANSFER OF THEIR
SHARES.

 

5.6.         DRAG-ALONG RIGHT. NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY,
IN THE EVENT OF A BONA FIDE ARM’S LENGTH SALE (INCLUDING A BINDING COMMITMENT TO
SELL) TO AN UNAFFILIATED THIRD PARTY BY SKT, IN A SINGLE TRANSACTION OR A SERIES
OF RELATED TRANSACTIONS (WHETHER BY SALE OF SHARES, MERGER, AMALGAMATION,
CONSOLIDATION, SALE OF ASSETS OR SIMILAR TRANSACTION), OF NOT LESS THAN A
MAJORITY OF THE TOTAL OUTSTANDING SHARES THEN OWNED BY SKT (A “RECOMMENDED
TRANSACTION”), EACH OF THE OTHER STOCKHOLDERS (COLLECTIVELY, THE “SUBJECT
STOCKHOLDERS”) WILL BE OBLIGED TO SELL IF REQUIRED BY SKT, IN THE SAME
TRANSACTION OR TRANSACTIONS, THE SAME PROPORTION OF THE TOTAL OUTSTANDING SHARES
HELD BY SUCH SUBJECT STOCKHOLDER AS BEING SOLD BY SKT, AND EACH SUBJECT
STOCKHOLDER FURTHER AGREES (IF IT IS REQUIRED TO PARTICIPATE IN THE SALE) TO
VOTE, OR GRANT PROXIES TO VOTE, THE PROPORTION OF SUCH SUBJECT STOCKHOLDER’S
TOTAL OUTSTANDING SHARES SUBJECT TO THE RECOMMENDED TRANSACTION IN FAVOR OF THE
RECOMMENDED TRANSACTION AND TO TAKE SUCH OTHER VOTES OR ACTIONS AS MAY BE
REASONABLY NECESSARY TO FACILITATE THE RECOMMENDED TRANSACTION. THE OBLIGATIONS
OF THE SUBJECT STOCKHOLDERS PURSUANT TO THIS SECTION 5.6 ARE SUBJECT TO THE
SATISFACTION OF THE FOLLOWING CONDITIONS:

 

5.6.1       UPON THE CONSUMMATION OF THE RECOMMENDED TRANSACTION, ALL OF THE
SUBJECT STOCKHOLDERS SHALL RECEIVE THE SAME PROPORTION OF THE AGGREGATE
CONSIDERATION FROM SUCH RECOMMENDED TRANSACTION THAT SUCH HOLDER WOULD HAVE
RECEIVED IF SUCH AGGREGATE CONSIDERATION HAD BEEN DISTRIBUTED BY THE MANAGEMENT
COMPANY IN COMPLETE LIQUIDATION PURSUANT TO THE RIGHTS AND PREFERENCES SET FORTH
IN THE CERTIFICATE OF INCORPORATION AS IN EFFECT IMMEDIATELY PRIOR TO SUCH
RECOMMENDED TRANSACTION. SKT UNCONDITIONALLY AGREES THAT NO CONSIDERATION IN
CONNECTION WITH THE RECOMMENDED TRANSACTION WILL BE DIVERTED AWAY FROM THE
SUBJECT STOCKHOLDERS THROUGH VALUE-ADDED PARTNERSHIP OR COMMERCIAL AGREEMENTS
ENTERED INTO IN CONNECTION WITH SUCH RECOMMENDED TRANSACTION.

 

5.6.2       IF ANY SUBJECT STOCKHOLDERS OF A CLASS OR SERIES IS GIVEN AN OPTION
AS TO THE FORM AND AMOUNT OF CONSIDERATION TO BE RECEIVED, ALL HOLDERS OF SUCH
CLASS OR SERIES WILL BE GIVEN THE SAME OPTION.

 

5.6.3       NO SUBJECT STOCKHOLDERS SHALL BE OBLIGATED TO MAKE ANY OUT-OF-POCKET
EXPENDITURE PRIOR TO THE CONSUMMATION OF THE RECOMMENDED TRANSACTION AND NO
SUBJECT STOCKHOLDERS SHALL BE OBLIGATED TO PAY MORE THAN ITS PRO RATA SHARE
(BASED UPON THE AMOUNT OF CONSIDERATION RECEIVED) OF REASONABLE EXPENSES
INCURRED IN CONNECTION WITH A CONSUMMATED RECOMMENDED TRANSACTION TO THE EXTENT
SUCH COSTS ARE INCURRED FOR THE BENEFIT OF SKT AND ALL SUBJECT STOCKHOLDERS AND
ARE NOT OTHERWISE PAID BY THE MANAGEMENT COMPANY OR THE ACQUIRING PARTY (COSTS
INCURRED BY SKT OR ON BEHALF OF A SUBJECT STOCKHOLDER FOR ITS SOLE BENEFIT WILL
NOT BE CONSIDERED COSTS OF THE TRANSACTION HEREUNDER); PROVIDED THAT SKT AND A
SUBJECT STOCKHOLDER’S LIABILITY FOR SUCH EXPENSES SHALL BE SHARED PRO RATA BASED
ON SKT AND EACH SUBJECT STOCKHOLDER’S SHARE OF THE SHARE CAPITAL OF THE
MANAGEMENT COMPANY.

 

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5.6.4       IN THE EVENT THAT SKT AND ALL THE SUBJECT STOCKHOLDERS ARE REQUIRED
TO PROVIDE ANY REPRESENTATIONS OR INDEMNITIES IN CONNECTION WITH THE RECOMMENDED
TRANSACTION (OTHER THAN REPRESENTATIONS AND INDEMNITIES CONCERNING (I) EACH
SUBJECT STOCKHOLDER’S VALID OWNERSHIP OF ITS SHARES IN THE MANAGEMENT COMPANY,
FREE OF ALL LIENS AND ENCUMBRANCES (OTHER THAN THOSE ARISING UNDER APPLICABLE
SECURITIES LAWS), AND (II) EACH SUBJECT STOCKHOLDER’S AUTHORITY, POWER, AND
RIGHT TO ENTER INTO AND CONSUMMATE SUCH PURCHASE OR MERGER (AMALGAMATION)
AGREEMENT WITHOUT VIOLATING ANY OTHER AGREEMENT), THEN EACH SUBJECT STOCKHOLDER
SHALL NOT BE LIABLE FOR MORE THAN ITS PRO RATA SHARE (BASED UPON THE AMOUNT OF
CONSIDERATION ACTUALLY RECEIVED) OF ANY LIABILITY FOR MISREPRESENTATION OR
INDEMNITY AND SUCH LIABILITY SHALL NOT EXCEED THE TOTAL PURCHASE PRICE RECEIVED
BY SUCH SUBJECT STOCKHOLDER FOR ITS SHARES.

 

5.6.5       NO SUBJECT STOCKHOLDER SHALL BE OBLIGATED TO ENTER INTO ANY
NON-COMPETITION OR OTHER RESTRICTIVE COVENANT IN CONNECTION WITH THE RECOMMENDED
TRANSACTION UNLESS (I) SUCH RESTRICTIVE COVENANT ONLY PROHIBITS THE SUBJECT
STOCKHOLDER FROM PROVIDING MVNO SERVICES (AS DEFINED IN SECTION 6.7.2) IN THE
UNITED STATES FOR A PERIOD OF TWO (2) YEARS, AND (II) SKT AND EACH OTHER SUBJECT
STOCKHOLDER AGREE TO SUCH RESTRICTIVE COVENANT IN CONNECTION WITH THE
RECOMMENDED TRANSACTION.

 

5.6.6       THE PROVISIONS OF THIS SECTION 5.6 SHALL TERMINATE ON THE
CONSUMMATION OF A PUBLIC OFFERING.

 

5.7.         TRANSFER OF CLASS B COMMON STOCK. EXCEPT AS PROVIDED BELOW, IF A
CLASS B STOCKHOLDER DESIRES TO TRANSFER ITS SHARES OF CLASS B COMMON STOCK OTHER
THAN TO AN AFFILIATE, THEN IT MUST, FIRST, CONVERT ITS SHARES OF CLASS B COMMON
STOCK INTO SHARES OF CLASS A COMMON STOCK, AND SECOND, TRANSFER THE SHARES OF
CLASS A COMMON STOCK PURSUANT TO A PERMITTED TRANSFER. NOTWITHSTANDING THE
FOREGOING RESTRICTION, A HOLDER OF CLASS B COMMON STOCK MAY SELL ITS SHARES OF
CLASS B COMMON STOCK IN A TRANSACTION IN WHICH IT COMPLETELY DIVESTS ITSELF OF
ALL INTERESTS IN THE MANAGEMENT COMPANY AND THE OPERATING COMPANY, SUBJECT AT
ALL TIMES TO THE TRANSFER RESTRICTIONS SET FORTH IN THIS STOCKHOLDERS’ AGREEMENT
AND THE OPERATING AGREEMENT.

 

ARTICLE 6
RESTRICTED SERVICES

 

6.1.         RESTRICTED SERVICES. FOR THE PERIODS SPECIFIED BELOW, THE
MANAGEMENT COMPANY SHALL CAUSE THE OPERATING COMPANY AND ITS SUBSIDIARIES TO
REFRAIN FROM PROVIDING THE SERVICES SET FORTH IN THIS SECTION 6.1 (THE
“RESTRICTED SERVICES”), EXCEPT AS PROVIDED IN SECTION 6.1.3 OR PURSUANT TO A
WRITTEN AGREEMENT WITH THE PARTY BENEFITING FROM SUCH RESTRICTIONS.

 

6.1.1       EARTHLINK SERVICES. FOR SO LONG AS EARTHLINK OR A SUBSIDIARY OF
EARTHLINK OWNS A SHARE OF CLASS B COMMON STOCK, THE MANAGEMENT COMPANY SHALL
CAUSE THE OPERATING COMPANY AND ITS SUBSIDIARIES TO REFRAIN FROM PROVIDING THE
FOLLOWING RESTRICTED SERVICES THAT THE PARTIES DEEM TO COMPETE WITH AND OVERLAP
THE PRODUCTS AND SERVICES PROVIDED BY EARTHLINK AND ITS AFFILIATES: (A)
BROADBAND INTERNET ACCESS, INCLUDING CABLE, DSL, PC-BASED SATELLITE AND FIXED
WIRELESS; (B) DIAL-UP INTERNET ACCESS; (C) WEB HOSTING SERVICES; (D) VOIP OR
VOWIFI SERVICES OVER BROADBAND; (E) PC-BASED WIRELESS WIDE AREA NETWORK OR LOCAL
AREA

 

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NETWORK INTERNET ACCESS SERVICES (E.G. HOME NETWORKING) AND (F) INTERNET PORTAL
SERVICE FOR THIRD PARTIES THAT ARE NOT CUSTOMERS OF THE OPERATING COMPANY OR A
SUBSIDIARY THEREOF, EXCEPT AS NEEDED FOR CUSTOMER ACQUISITION SERVICES AND
MAINTENANCE PURPOSES.

 

6.1.2       SKT SERVICES. FOR SO LONG AS SKT OR A SUBSIDIARY OF SKT OWNS A SHARE
OF CLASS B COMMON STOCK, THE MANAGEMENT COMPANY SHALL CAUSE THE OPERATING
COMPANY AND ITS SUBSIDIARIES TO REFRAIN FROM PROVIDING THE FOLLOWING RESTRICTED
SERVICES THAT THE PARTIES DEEM TO COMPETE WITH AND OVERLAP THE PRODUCTS AND
SERVICES PROVIDED BY SKT AND ITS AFFILIATES:  (A) MOBILE VIRTUAL NETWORK
ENABLER, WIRELESS APPLICATION SERVICE PROVIDER AND MANAGED SERVICES FOR WIRELESS
TELECOM SERVICE PROVIDERS AND (B) DEVELOPMENT AND MANUFACTURE OF WIRELESS
DEVICES WITH THE INTENT TO SELL SUCH DEVICES TO WIRELESS TELECOM SERVICE
PROVIDERS, PROVIDED, THAT THE OPERATING COMPANY AND ITS SUBSIDIARIES ARE
PERMITTED TO PURCHASE AND DISTRIBUTE SUCH DEVICES THAT ARE MANUFACTURED BY
THIRD-PARTY MANUFACTURERS.

 

6.1.3       SALES TO COMMERCIAL PARTNERS. NOTWITHSTANDING THE ABOVE
RESTRICTIONS, THE OPERATING COMPANY AND ITS SUBSIDIARIES MAY OFFER THE OPERATING
COMPANY PRODUCTS AND SERVICES TO COMMERCIAL PARTNERS WHO BUNDLE AND SELL THE
OPERATING COMPANY PRODUCTS AND SERVICES WITH PRODUCTS AND SERVICES WHICH
CONSTITUTE OR ARE SIMILAR TO THE RESTRICTED SERVICES.

 

6.2.         PRODUCTS AND SERVICES OUTSIDE THE BUSINESS PLAN. THE MANAGEMENT
COMPANY SHALL CAUSE THE OPERATING COMPANY AND ITS SUBSIDIARIES TO REFRAIN FROM
ENGAGING IN THE DEVELOPMENT OF NEW PRODUCTS AND SERVICES THAT ARE OUTSIDE OF THE
APPROVED BUSINESS PLAN.

 

6.3.         WIMAX ENABLED DEVICES. THE OPERATING COMPANY AND ITS SUBSIDIARIES
MAY DISTRIBUTE HANDSET DEVICES THAT CONTAIN THE HARDWARE AND SOFTWARE COMPONENTS
NECESSARY TO PERMIT WIMAX ACCESS (“WIMAX ENABLED DEVICES”) AND RELATED HAND-SET
ONLY WIMAX SERVICES, BUT, FOR SO LONG AS EARTHLINK OR A SUBSIDIARY OF EARTHLINK
OWNS A SHARE OF CLASS B COMMON STOCK, MAY NOT SELL PC-BASED WIMAX SERVICES OTHER
THAN THOSE OF EARTHLINK. THE OPERATING COMPANY AND ITS SUBSIDIARIES MAY
DISTRIBUTE WIMAX ENABLED DEVICES TO THIRD PARTIES WHO BUNDLE AND RESELL THE
WIMAX ENABLED DEVICES WITH THE WIMAX HANDSET ONLY ACCESS SERVICES OF SUCH THIRD
PARTY. THE OPERATING COMPANY MAY ONLY OFFER EARTHLINK’S PC-BASED WIMAX DEVICES
AND SERVICES, WHICH EARTHLINK SHALL MAKE AVAILABLE TO THE OPERATING COMPANY ON
PRICES, TERMS AND CONDITIONS THAT ARE AT LEAST AS FAVORABLE, FROM A FINANCIAL
PERSPECTIVE, TO THE OPERATING COMPANY AS THE PRICES, TERMS AND CONDITIONS OF
SUBSTANTIALLY SIMILAR PRODUCTS AND SERVICES PROVIDED BY EARTHLINK TO A THIRD
PARTY NOT AFFILIATED WITH EARTHLINK. DISTRIBUTION OF ANY OTHER WIMAX CONVERGENT
DEVICES, BETWEEN PC AND HANDSET DEVICES, MUST BE APPROVED BY (I) A MAJORITY OF
CLASS B DIRECTORS, AND (II) A MAJORITY VOTE OF ALL DIRECTORS.

 

6.4.         [RESERVED.]

 

6.5.         ASP. FOR SO LONG AS EARTHLINK OR A SUBSIDIARY OF EARTHLINK OWNS A
SHARE OF CLASS B COMMON STOCK, EACH STOCKHOLDER AND EACH SUBSIDIARY OF A
STOCKHOLDER THAT ACTS AS AN ASP IN THE UNITED STATES (EACH, A “PROVIDER”) SHALL,
IF REQUESTED BY THE OPERATING COMPANY, PROVIDE ASP SOLUTIONS, APPLICATIONS AND
PLATFORMS, INCLUDING A LICENSE OR PROFESSIONAL SERVICE WITH RESPECT THERETO, BUT
EXCLUDING COLORING SERVICE, TO THE OPERATING COMPANY ON TERMS NO LESS FAVORABLE
THAN THOSE OFFERED BY THE PROVIDER TO THIRD PARTY PURCHASERS IN THE UNITED
STATES FOR SUBSTANTIALLY SIMILAR VOLUMES OF SUBSTANTIALLY SIMILAR PRODUCTS AND
SERVICES.

 

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6.6.         Future Services. EarthLink and SKT acknowledge that the list of
Restricted Services is complete as of March 24, 2005. If EarthLink or SKT
provides any future products or services within the United States, such as
wired-wireless integrated service or satellite/terrestrial digital broadcasting
services, that are excluded from the then-current scope of Restricted Services,
then, for so long as such Stockholder or a Subsidiary of such Stockholder owns a
share of Class B Common Stock, EarthLink and SKT shall negotiate in good faith
whether or not to include such services as part of the Restricted Services.

 

6.7.         Exclusivity.

 

6.7.1       FROM THE DATE HEREOF UNTIL THE EARLIER OF (A) THE DATE OF THE SKT
TRIGGERING CONTRIBUTION OR (B) TWO (2) YEARS FROM THE FIRST DATE ON WHICH EITHER
CLASS B STOCKHOLDER’S OWNERSHIP OF THE TOTAL OUTSTANDING SHARES FALLS BELOW TEN
PERCENT (10%), EARTHLINK AND SKT AND THEIR SUBSIDIARIES SHALL NOT PROVIDE MOBILE
WIRELESS VOICE OR DATA SERVICES OVER HANDSETS IN THE UNITED STATES; PROVIDED,
HOWEVER, IN THE EVENT OF A CONTRIBUTION BREACH, SKT SHALL NOT PROVIDE MOBILE
WIRELESS VOICE OR DATA SERVICES OVER HANDSETS IN THE UNITED STATES FROM THE DATE
OF THE CONTRIBUTION BREACH UNTIL TWO (2) YEARS FROM THE FIRST DATE ON WHICH
EITHER CLASS B STOCKHOLDER’S OWNERSHIP OF THE TOTAL OUTSTANDING SHARES FALLS
BELOW TEN PERCENT (10%). IN THE EVENT THAT SKT PROVIDES MOBILE WIRELESS VOICE OR
DATA SERVICES OVER HANDSETS IN THE UNITED STATES IN THE PERIOD BETWEEN THE DATE
OF THE SKT TRIGGERING CONTRIBUTION AND A CONTRIBUTION BREACH, UPON A
CONTRIBUTION BREACH (I) SKT MUST IMMEDIATELY CEASE PROVIDING ALL SUCH SERVICES
(OTHER THAN THROUGH THE MANAGEMENT COMPANY OR THE OPERATING COMPANY), (II) ANY
AGREEMENTS ENTERED INTO BY SKT (OTHER THAN THROUGH THE MANAGEMENT COMPANY OR THE
OPERATING COMPANY) RELATED TO PROVIDING SUCH SERVICES WILL BE VOID AS OF THE
DATE OF THE CONTRIBUTION BREACH AND (III) ANY ENTITY (WHICH SHALL NOT INCLUDE
THE MANAGEMENT COMPANY OR THE OPERATING COMPANY) CREATED BY SKT TO PROVIDE SUCH
SERVICES MUST BE DISSOLVED. IT IS UNDERSTOOD AND AGREED THAT MONEY DAMAGES WOULD
NOT FULLY COMPENSATE EARTHLINK AS A REMEDY FOR A CONTRIBUTION BREACH BY SKT AND,
WITHOUT PREJUDICE TO ANY OTHER RIGHTS AND REMEDIES OTHERWISE AVAILABLE TO
EARTHLINK, EARTHLINK SHALL BE ENTITLED TO EQUITABLE RELIEF BY WAY OF INJUNCTION,
SPECIFIC PERFORMANCE OR OTHERWISE WITH RESPECT TO THIS SECTION 6.7 IN THE EVENT
OF A CONTRIBUTION BREACH.

 

6.7.2       OTHER THAN THROUGH THE OPERATING COMPANY, EARTHLINK AND SKT AND
THEIR SUBSIDIARIES SHALL NOT PROVIDE MVNO SERVICES IN THE UNITED STATES. THE
RESTRICTIONS SET FORTH IN THIS SECTION 6.7.2 SHALL TERMINATE ON THE DATE THAT IS
TWO (2) YEARS FROM THE FIRST DATE ON WHICH EITHER CLASS B STOCKHOLDER’S
OWNERSHIP OF THE TOTAL OUTSTANDING SHARES FALLS BELOW TEN PERCENT (10%). FOR
PURPOSES OF THIS SECTION 6.7.2, “MVNO SERVICES” MEANS PROVIDING MOBILE VOICE AND
DATA SERVICES ON MOBILE HANDSETS WITHOUT OWNING ANY MATERIAL PART OF A MOBILE
NETWORK OR FREQUENCY PERTAINING TO SUCH SAID MOBILE SERVICES, BUT INSTEAD BY
LEASING ALL OR SUBSTANTIALLY ALL OF THE MOBILE NETWORK AND FREQUENCY FROM MOBILE
NETWORK OPERATORS.

 

6.7.3       NEITHER EARTHLINK NOR SKT NOR THEIR RESPECTIVE SUBSIDIARIES SHALL
ASSIST ANY PARENT ENTITY OR ANY SUBSIDIARY OF A PARENT ENTITY IN ANY ACTIVITY
THAT WOULD CONSTITUTE A VIOLATION OF THE EXCLUSIVITY PROVISIONS SET FORTH IN
THIS SECTION 6.7 IF IT WERE PERFORMED BY SUCH PARTY OR ITS SUBSIDIARY DIRECTLY.
EXCEPT AS PROVIDED IN THIS AGREEMENT, NOTHING SHALL PROHIBIT EARTHLINK AND SKT
OR THEIR RESPECTIVE SUBSIDIARIES FROM COMPETING WITH EACH OTHER OR THE OPERATING
COMPANY, ITS PARENT ENTITY OR ANY OF ITS SUBSIDIARIES.

 

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6.8.         [Reserved].

 

6.9.         Availability of Injunctive Relief. The parties acknowledge that
each may seek injunctive relief under Section 11.2 to satisfy the requirement of
this Article 6 as well as for any other breach of this Agreement.

 

ARTICLE 7
CONVERSION AND EXCHANGE

 

7.1.         Conversion of Class B Common Stock. The Stockholders may convert
their shares of Class B Common Stock to shares of Class A Common Stock as
provided in the Certificate of Incorporation, and each Stockholder agrees to
vote its Shares in such a manner as to give full effect to such conversion
rights.

 

7.2.         Exchange of Membership Units. The Stockholders may exchange their
Membership Units for shares of Class A Common Stock as provided in the Operating
Agreement, and each Stockholder agrees to vote its Shares in such a manner as to
give full effect to such exchange rights.

 

7.3.         Conversion of Convertible Preferred Stock. The Stockholders may
convert their shares of convertible Preferred Stock, if any, to shares of Class
A Common Stock as provided in the Certificate of Incorporation, and each
Stockholder agrees to vote its Shares in such a manner as to give full effect to
such conversation rights.

 

7.4.         Availability of Authorized and Unissued Class A Common Stock. The
Stockholders will vote their Shares to ensure that at all times sufficient
shares of Class A Common Stock are reserved out of the authorized but unissued
Shares to permit the issuance of shares of Class A Common Stock sufficient to
(a) exchange all of the outstanding Membership Units, (b) convert the shares of
Class B Common Stock (c) convert the shares of convertible Preferred Stock and
(d) permit the exercise of any outstanding Class A Options, each as provided for
in the Management Company’s Certificate of Incorporation and the Operating
Agreement. The Stockholders will vote their Shares to list the shares of Class A
Common Stock required to be delivered by the Operating Company upon conversion
or exchange prior to such delivery upon each national securities exchange or
other recognized trading market upon which the outstanding Class A Common Stock
is listed at the time of such delivery. If at any time there are not sufficient
shares of Class A Common Stock authorized by the Certificate of Incorporation as
required by this Section 7.4 and the then existing holders of the requisite
number of Class A Common Stock fail to vote in favor of an amendment to the
Certificate of Incorporation to increase the amount of Class A Common Stock,
then each Stockholder will exchange its pro rata number of Membership Units for
Class A Common Stock pursuant to Section 7.2 hereof and Section 15.1 of the
Operating Agreement in an amount necessary to obtain the requisite affirmative
vote of the Class A Common Stock to effect such amendment.

 

7.5.         Authorization of Class B Common Stock. The Stockholders, with
respect to any issuance of Class B Common Stock to an unaffiliated third party
approved by the Board, will vote their Shares to increase the authorized number
of shares of Class B Common Stock in the

 

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Certificate of Incorporation to ensure that the Company may issue such shares of
Class B Common Stock.

 

ARTICLE 8
STRATEGIC DECISIONS AND DEADLOCK MATTERS

 

8.1.         Strategic Decisions. For so long as EarthLink owns at least twenty
percent (20%) of the Total Outstanding Shares, all matters set forth on
Schedule 8.1(a) (the “Strategic Decisions”) shall require the affirmative vote
of (i) all Class B Directors, and (ii) a majority vote of all directors, and all
other matters requiring the approval of the Board of Directors, including those
matters set forth on Schedule 8.1(b), shall require the affirmative vote of (A)
a majority of the Class B Directors, and (B) a majority vote of all directors.
If EarthLink ceases to own at least twenty percent (20%) of the Total
Outstanding Shares, all matters requiring the approval of the Board of
Directors, including all matters set forth on Schedules 8.1(a) and (b), shall
require the affirmative vote of (1) a majority of the Class B Directors, and (2)
a majority vote of all directors.

 

8.2.         Deadlock. If, after consideration at a meeting of Board of
Directors, the Board of Directors is unable to reach a decision regarding a
Strategic Decision (a “Deadlock Matter”), then the chief executive officer of
each holder of Class B Common Stock shall have forty-five (45) days following
such meeting of Board of Directors to meet and negotiate, in good faith, to
resolve the Deadlock Matter. If the chief executive officers of the holders of
Class B Common Stock are unable to resolve a Deadlock Matter within such
forty-five (45) day period, then the Deadlock Matter shall remain until later,
if ever, resolved. The Management Company and Operating Company shall continue
to operate in a manner consistent with prior practices until such time as a
Deadlock Matter is resolved. For purposes of illustration only, if a Deadlock
Matter concerns the approval of a Business Plan, the Management Company and
Operating Company shall continue to operate under the then-current Business Plan
pending resolution of the Deadlock Matter. The deadlock provision set forth in
this Section 8.2 shall terminate upon a Public Offering.

 

ARTICLE 9
CERTIFICATES

 

9.1.         Certificates. Any Shares held by a Stockholder shall be represented
by a certificate, setting forth upon the face thereof that the Management
Company is a corporation organized under the laws of the State of Delaware, the
name of the Person to which it is issued and the number of Shares which such
certificate represents. Such certificates shall be entered in the books of the
Management Company as they are issued, and shall be signed by the Chief
Executive Officer of the Management Company. Upon any Transfer permitted under
this Stockholders’ Agreement and the Operating Agreement, the transferring
Stockholder shall (a) issue to the transferee a certificate representing the
number of Shares so transferred and (b) surrender to the Management Company and
the Management Company shall issue to the transferring Stockholder certificates
representing the remaining Shares, if any, held by such transferring Stockholder
after taking into account such Transfer. All certificates representing

 

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Shares (unless registered under the Securities Act of 1933, as amended (the
“Securities Act”), shall bear the following legends:

 

THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY SECURITIES
REGULATORY AUTHORITY OF ANY STATE, AND MAY NOT BE OFFERED, SOLD, ASSIGNED,
PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED, EXCEPT IN A TRANSACTION WHICH IS
REGISTERED UNDER, EXEMPT FROM, OR OTHERWISE IN COMPLIANCE WITH THE FEDERAL AND
STATE SECURITIES LAWS, AS TO WHICH THE MANAGEMENT COMPANY HAS RECEIVED SUCH
ASSURANCES AS THE MANAGEMENT COMPANY MAY REQUEST, WHICH MAY INCLUDE, A
SATISFACTORY OPINION OF COUNSEL.

 

ANY SALE, ASSIGNMENT, TRANSFER, PLEDGE OR OTHER DISPOSITION OF THE SHARES
REPRESENTED BY THIS CERTIFICATE IS RESTRICTED BY, AND SUBJECT TO, THE TERMS AND
PROVISIONS OF AN AMENDED AND RESTATED STOCKHOLDERS’ AGREEMENT BETWEEN THE
MANAGEMENT COMPANY AND THE STOCKHOLDERS SET FORTH THEREIN AND A SECOND AMENDED
AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT BETWEEN HELIO LLC AND THE
MEMBERS NAMED THEREIN, EACH DATED THE         OF           , 2007. A COPY OF THE
AMENDED AND RESTATED STOCKHOLDERS’ AGREEMENT AND THE SECOND AMENDED AND RESTATED
LIMITED LIABILITY COMPANY AGREEMENT IS ON FILE WITH THE SECRETARY OF THE
MANAGEMENT COMPANY. BY ACCEPTANCE OF THIS CERTIFICATE, THE HOLDER HEREOF AGREES
TO BECOME BOUND BY THE AMENDED AND RESTATED STOCKHOLDERS’ AGREEMENT AND SECOND
AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT.

 

9.2.         Lost or Destroyed Certificates. The Management Company may issue a
new certificate for Shares in place of any certificate theretofore issued by it,
alleged to have been lost or destroyed, upon the making of an affidavit of that
fact, and providing an indemnity in form and subject reasonably satisfactory to
the Board of Directors by the Person claiming the certificate to be lost or
destroyed.

 

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ARTICLE 10
TERMINATION

 

10.1.       Termination. This Stockholders’ Agreement shall terminate upon the
first to occur of the events set forth in this Section 10.1:

 

10.1.1     WRITTEN CONSENT. THE WRITTEN CONSENT OF THE STOCKHOLDERS.

 

10.1.2     UNLAWFUL TO CONTINUE. THE OCCURRENCE OF ANY EVENT WHICH MAKES IT
UNLAWFUL FOR THE MANAGEMENT COMPANY TO BE CONTINUED.

 

10.1.3     ORDER OF DISSOLUTION. THE ISSUANCE OF A DECREE BY ANY COURT OF
COMPETENT JURISDICTION THAT THE MANAGEMENT COMPANY BE DISSOLVED AND LIQUIDATED.

 

10.2.       Effect of Termination; Survival. In the event of a termination, this
Stockholders’ Agreement and the provisions set forth herein shall terminate
automatically without any action by any party, except Articles 1, 4, 10 and 11,
which shall survive for the applicable periods set forth therein or, if none
stated, indefinitely.

 

ARTICLE 11
DISPUTE RESOLUTION

 

11.1.       Dispute Resolution. Any dispute arising out of or relating to this
Stockholders’ Agreement shall be resolved in accordance with the procedures
specified in this Section 11.1, which shall be the sole and exclusive procedure
for the resolution of any such dispute.

 

11.1.1     NEGOTIATION BETWEEN EXECUTIVES. THE STOCKHOLDERS SHALL ATTEMPT IN
GOOD FAITH TO RESOLVE ANY DISPUTE ARISING OUT OF OR RELATING TO THIS
STOCKHOLDERS’ AGREEMENT PROMPTLY BY DIRECT NEGOTIATION BETWEEN EXECUTIVES WHO
HAVE AUTHORITY TO SETTLE THE CONTROVERSY AND WHO ARE AT A HIGHER LEVEL OF
MANAGEMENT THAN THE PERSONS WITH DIRECT RESPONSIBILITY FOR ADMINISTRATION OF
THIS AGREEMENT, UNLESS THERE IS NO EXECUTIVE OF A HIGHER LEVEL. ANY PARTY MAY
GIVE THE OTHER PARTY WRITTEN NOTICE OF ANY DISPUTE NOT RESOLVED IN THE NORMAL
COURSE OF BUSINESS. WITHIN FIFTEEN (15) DAYS AFTER DELIVERY OF THE NOTICE, THE
RECEIVING PARTY SHALL SUBMIT TO THE OTHER A WRITTEN RESPONSE. THE NOTICE AND THE
RESPONSE SHALL INCLUDE: (A) A STATEMENT OF EACH PARTY’S POSITION AND A SUMMARY
OF ARGUMENTS SUPPORTING THAT POSITION; AND (B) THE NAME AND TITLE OF THE
EXECUTIVE WHO WILL REPRESENT THAT PARTY AND OF ANY OTHER PERSON WHO WILL
ACCOMPANY THE EXECUTIVE. WITHIN THIRTY (30) DAYS AFTER DELIVERY OF THE DISPUTING
PARTY’S NOTICE, THE EXECUTIVES OF EACH STOCKHOLDER SHALL MEET AT A MUTUALLY
ACCEPTABLE TIME AND PLACE, AND THEREAFTER AS OFTEN AS THEY REASONABLY DEEM
NECESSARY, TO ATTEMPT TO RESOLVE THE DISPUTE. ALL REASONABLE REQUESTS FOR
INFORMATION MADE BY ONE PARTY TO THE OTHER WILL BE HONORED. ALL NEGOTIATIONS
PURSUANT TO THIS CLAUSE ARE, CONFIDENTIAL AND SHALL BE TREATED AS COMPROMISE AND
SETTLEMENT NEGOTIATIONS FOR PURPOSES OF APPLICABLE RULES OF EVIDENCE.

 

11.1.2     MEDIATION WITH MUTUALLY AGREED-UPON NEUTRAL. IF THE DISPUTE HAS NOT
BEEN RESOLVED BY NEGOTIATION WITHIN FORTY-FIVE (45) DAYS OF THE DISPUTING
PARTY’S NOTICE, OR IF THE STOCKHOLDERS FAIL TO MEET WITHIN TWENTY (20) DAYS THE
STOCKHOLDERS SHALL SUBMIT THE DISPUTE TO NON-BINDING MEDIATION UNDER THE
THEN-CURRENT CPR INSTITUTE FOR DISPUTE RESOLUTION’S (“CPR”)

 

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MODEL MEDIATION PROCEDURE FOR BUSINESS DISPUTES, AND ENDEAVOR (BUT NOT BE
OBLIGATED) TO SETTLE THE DISPUTE IN SUCH MEDIATION. CPR’S ADDRESS AT THE TIME OF
THIS AGREEMENT IS 366 MADISON AVENUE, 14TH FLOOR, NEW YORK, NEW YORK 10017
(212-949-6490) AND ITS WEBSITE IS “WWW.CPRADR.ORG.”  THE STOCKHOLDERS AGREE TO
USE THEIR REASONABLE BEST EFFORTS AND GOOD FAITH TO AGREE MUTUALLY ON A
MEDIATOR, TO BE SELECTED FROM THE CPR TECHNOLOGY PANEL OF NEUTRALS. IF THE
STOCKHOLDERS FAIL TO SELECT A MUTUALLY ACCEPTABLE MEDIATOR WITHIN THIRTY (30)
DAYS AFTER EITHER PARTY’S NOTICE TO THE OTHER PARTY THAT THEY REQUEST
NON-BINDING MEDIATION PURSUANT TO THIS SUBSECTION, CPR WILL APPOINT A MEDIATOR
FROM THE TECHNOLOGY PANEL.

 

11.1.3     ARBITRATION. ALL DISPUTES ARISING OUT OF OR RELATING TO THIS
STOCKHOLDERS’ AGREEMENT NOT RESOLVED PURSUANT TO NON-BINDING MEDIATION WITHIN
THIRTY (30) DAYS OR AS THIS TIME PERIOD MAY BE EXTENDED BY WRITTEN AGREEMENT OF
THE STOCKHOLDERS SHALL BE SETTLED FINALLY IN AN ARBITRATION CONDUCTED UNDER THE
RULES OF ARBITRATION OF THE INTERNATIONAL CHAMBER OF COMMERCE (“ICC”) AND AS
PROVIDED IN THIS SECTION 11.1.3.

 

(A)                                  THE ARBITRATION PROCEEDINGS SHALL BE
CONDUCTED IN NEW YORK, NEW YORK, U.S.A.

 

(B)                                 THE ARBITRATION PROCEEDINGS SHALL BE
GOVERNED BY THE LAWS OF NEW YORK.

 

(C)                                  THE LANGUAGE OF THE ARBITRATION PROCEEDINGS
SHALL BE ENGLISH.

 

(D)                                 THE ARBITRAL TRIBUNAL SHALL CONSIST OF THREE
(3) ARBITRATORS, ONE (1) OF WHICH SHALL BE SELECTED BY SKT AND ONE (1) OF WHICH
SHALL BE SELECTED BY EARTHLINK. THE THIRD ARBITRATOR SHALL BE SELECTED BY THE
TWO (2) ARBITRATORS APPOINTED BY SKT AND EARTHLINK.

 

(E)                                  THE INTERNATIONAL BAR ASSOCIATION’S RULES
ON THE TAKING OF EVIDENCE IN INTERNATIONAL COMMERCIAL ARBITRATION SHALL APPLY
TOGETHER WITH THE ICC RULES GOVERNING ANY SUBMISSION TO ARBITRATION INCORPORATED
IN THIS AGREEMENT.

 

(F)                                    EVERY AWARD SHALL BE BINDING ON THE
STOCKHOLDERS. BY SUBMITTING THE DISPUTE TO ARBITRATION UNDER THE ICC RULES, THE
STOCKHOLDERS UNDERTAKE TO CARRY OUT ANY AWARD WITHOUT DELAY AND SHALL BE DEEMED
TO HAVE WAIVED THEIR RIGHT TO ANY FORM OF RECOURSE INSOFAR AS SUCH WAIVER CAN
VALIDLY BE MADE.

 

(G)                                 THIS AGREEMENT TO ARBITRATE SHALL BE BINDING
ON THE STOCKHOLDERS AND THEIR RESPECTIVE SUCCESSORS, ASSIGNS AND AFFILIATES.

 

(H)                                 THE PREVAILING PARTY IN ANY ARBITRATION
PROCEEDING CONDUCTED PURSUANT TO THIS STOCKHOLDERS’ AGREEMENT MAY RECOVER ITS
REASONABLE FEES BOTH FOR LEGAL REPRESENTATION AND RELATED COSTS IN ANY ACTION TO
ENFORCE THIS AGREEMENT IN ANY JUDICIAL OR ARBITRATION PROCEEDING.

 

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(I)                                     THE STOCKHOLDERS WAIVE ANY RIGHT OR
CLAIM TO PUNITIVE OR EXEMPLARY DAMAGES AND AGREE THAT PUNITIVE OR EXEMPLARY
DAMAGES ARE NOT WITHIN THE CONTEMPLATION OF THIS STOCKHOLDERS’ AGREEMENT. NO
ARBITRAL TRIBUNAL MAY ORDER AN AWARD CONSISTING IN WHOLE OR IN PART OF PUNITIVE
OR EXEMPLARY DAMAGES.

 

11.1.4     TOLLING OF STATUTES OF LIMITATION. ALL APPLICABLE STATUTES OF
LIMITATION AND DEFENSES BASED ON THE PASSAGE OF TIME SHALL BE TOLLED WHILE THE
PROCEDURES SPECIFIED IN SECTION 11.1.2 AND SECTION 11.1.3 ARE PENDING. THE
STOCKHOLDERS WILL TAKE SUCH ACTION, IF ANY, REQUIRED TO EFFECTUATE SUCH TOLLING.

 

11.2.       Right to Injunctive Relief Before Appointment of Arbitrators. With
respect to any violations of this Stockholders’ Agreement which would cause or
might cause irreparable injury to any one of the parties to this Stockholders’
Agreement, any party may, in addition to any other rights under this
Stockholders’ Agreement and notwithstanding the dispute resolution procedures
including, particularly, the arbitration agreement contained in this Section
11.2, seek specific performance of this Stockholders’ Agreement and injunctive
relief in any court of competent jurisdiction against any ongoing violation of
this Stockholders’ Agreement. Prior to the appointment of the arbitrators
pursuant to the arbitration agreement, any party hereto may seek provisional or
interim measures from any court of competent jurisdiction. After the appointment
of the arbitrators, the arbitrators shall have exclusive power to consider and
grant requests for provisional or interim measures.

 

ARTICLE 12
MISCELLANEOUS

 

12.1.       Governing Law. This Stockholders’ Agreement and the rights and
obligations of the Stockholders shall be governed by and construed in accordance
with and subject to the laws of the State of New York.

 

12.2.       Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be deemed given (i) on
the first calendar day following the date of delivery in person or by telecopy
(in each case with telephonic confirmation of receipt by the addressee), (ii) on
the first calendar day following timely deposit with an overnight courier
service, if sent by overnight courier specifying next day delivery or (iii) on
the first calendar day that is at least five (5) days following deposit in the
mails, if sent by first class mail, to the Stockholders at the following
addresses (or at such other address for a Stockholder as shall be specified by
like notice):

 

If to SKT:

 

SK Telecom Co., Ltd.

11, Euljiro2-ga, Jung-gu

Seoul 100-999, Korea

Attention:  Mr. Seung – Kook Synn

Facsimile:  (822) 6100-7966

 

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with a copy to:

 

Baker & McKenzie
14th Floor, Hutchison House, 10 Harcourt
Hong Kong, SAR
Attention: Mr. Won Lee
Facsimile:  (852) 2845 0476

 

If to EarthLink:

 

EarthLink, Inc.

1375 Peachtree Street, N.E.

Atlanta, Georgia 30309

Attention:  Chief Executive Officer

Facsimile:  (404) 892-7616

Copy to:  Samuel R. DeSimone, General Counsel

 

with a copy to:

 

Troutman Sanders LLP

600 Peachtree Street N.E., Suite 5200

Atlanta, Georgia 30308

Attention:  David M. Carter

Facsimile:  (404) 962-6598

 

If to the Management Company:

 

HELIO, Inc.

10960 Wilshire Blvd., Suite 700

Los Angeles, California 90024

Attention:  Legal Department

Facsimile:  (310) 312-8889

 

with a copy to:

 

HELIO LLC

10960 Wilshire Blvd., Suite 700

Los Angeles, California 90024

Attention:  Sky D. Dayton, Chief Executive Officer

Facsimile:  (310) 996-1368

 

with a copy to:

 

Kirkpatrick & Lockhart Preston Gates Ellis LLP

10100 Santa Monica Boulevard, Seventh Floor

 

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Los Angeles, California 90067

Attention:  Thomas J. Poletti

Facsimile:  (310) 552-5001

 

12.3.       Compliance with Applicable Laws. The Management Company shall
provide each Class B Stockholder with access to all of the books, records and
other information of the Management Company necessary to permit each such Class
B Stockholder to satisfy its compliance obligations under the Sarbanes-Oxley Act
of 2002 and under all other applicable state, federal and foreign laws.

 

12.4.       Severability. The provisions of this Stockholders’ Agreement shall
be deemed severable and the invalidity or unenforceability of any provision
shall not affect the validity or enforceability of the other provisions hereof.
If any provision of this Stockholders’ Agreement or the application thereof to
any Person or any circumstance, is invalid or unenforceable, (i) a suitable and
equitable provision shall be substituted therefor in order to carry out, so far
as may be valid and enforceable, the intent and purpose of such invalid or
unenforceable provision and (ii) the remainder of this Stockholders’ Agreement
and the application of such provision to other Persons or circumstances shall
not be affected by such invalidity or unenforceability, nor shall such
invalidity or unenforceability affect the validity or enforceability of such
provision, or the application thereof, in any other jurisdiction.

 

12.5.       Counterparts. For the convenience of the parties hereto, this
Stockholders’ Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original and all of which shall together
constitute the same agreement.

 

12.6.       Headings. All Section headings are for convenience of reference only
and are not part of this Stockholders’ Agreement, and no construction or
reference shall be derived therefrom.

 

12.7.       Successors and Assigns. This Stockholder’s Agreement shall be
binding upon and inure to the benefit of the Stockholders and their respective
successors and permitted assigns and shall not be assignable except to the
extent expressly permitted hereby and any purported assignment of this
Stockholders’ Agreement or of any Shares in violation of this Stockholders’
Agreement shall be null and void and of no force or effect. The rights and
obligations under this Stockholders’ Agreement shall be assigned by a
Stockholder to a transferee in connection with the Transfer to such transferee
pursuant to Article 5.

 

12.8.       Entire Agreement; Waiver. This Stockholders’ Agreement (including
any Schedules hereto) and the Ancillary Agreements (including any exhibits and
schedules thereto), supersede all prior agreements, written or oral, among the
Stockholders with respect to the subject matter hereof and thereof and contain
the entire agreement among the Stockholders with respect to the subject matter
hereof and thereof. This Stockholders’ Agreement may not be amended,
supplemented or modified, and no provisions hereof may be modified or waived,
except by an instrument in writing signed by the Management Company and each
Stockholder owning more than ten percent (10%) of the Total Outstanding Shares;
provided, however, that Article 6 and Section 8.1 may only be amended with the
approval of (i) all Class B Directors, and (ii) a majority vote of all
directors. No waiver of any provisions hereof by any Stockholder

 

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shall be deemed a waiver of any other provisions hereof by any such Stockholder,
nor shall any such waiver be deemed a continuing waiver of any provision hereof
by such Stockholder.

 

12.9.       No Relief of Liabilities. The Transfer by a Stockholder of any JV
Securities Beneficially Owned by such Stockholder shall not relieve such
Stockholder of any liabilities or obligations to the Management Company or any
other Stockholder, as the case may be, that arose or accrued prior to the date
of such Transfer.

 

12.10.     Further Assurances. Each Stockholder shall at any time, and from time
to time, execute and deliver such additional instruments and other documents and
shall at any time, and from time to time, take such further actions as may be
necessary or appropriate to effectuate, carry out and comply with all of the
terms of this Stockholders’ Agreement and the transactions contemplated hereby.

 

12.11.     THIRD PARTY BENEFICIARIES. NOTHING IN THIS STOCKHOLDERS’ AGREEMENT,
EXPRESS OR IMPLIED, IS INTENDED TO CONFER UPON ANY THIRD PARTY ANY RIGHTS OR
REMEDIES OF ANY NATURE WHATSOEVER UNDER OR BY REASON OF THIS STOCKHOLDERS’
AGREEMENT.

 

12.12.     Joinder. Any Person that acquires any shares of Class B Common Stock
in compliance with the terms hereof and the Certificate of Incorporation shall,
without the need for approval by any other party to this Stockholders’
Agreement, become a party to this Stockholders’ Agreement by executing and
delivering a joinder signature page hereto in the form of Exhibit A hereto
whereupon such Person shall be deemed a “Class B Stockholder” and a
“Stockholder” for all purposes of this Agreement and shall automatically be
added to Schedule 2.2 hereto.

 

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IN WITNESS WHEREOF, the Parties hereto have executed this Stockholders’
Agreement as of the date first written above.

 

 

SK TELECOM CO., LTD.

 

 

 

 

 

 

 

 

Jin Woo So, Senior Vice President

 

 

 

 

 

EARTHLINK, INC.

 

 

 

 

 

 

 

 

Name:

 

Title:

 

 

 

 

 

 

 

HELIO, INC.

 

 

 

 

 

 

 

 

Sky D. Dayton, Chief Executive Officer

 

 

[Signature Page to Stockholders’ Agreement]

 

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Schedule 8.1(a)

 

Strategic Decisions

 

The following Strategic Decisions shall be approved as provided in Article 8 of
this Stockholders’ Agreement:

 

(A)                                  ANY AMENDMENT TO GOVERNING DOCUMENTS, TO
THE EXTENT (I) WITH RESPECT TO AN AMENDMENT OF THE CERTIFICATE OF INCORPORATION,
SUCH AMENDMENT ALTERS OR CHANGES THE POWERS, PREFERENCES OR SPECIAL RIGHTS OF
THE CLASS A COMMON STOCK OR CLASS B COMMON STOCK, (II) WITH RESPECT TO AN
AMENDMENT TO THE OPERATING AGREEMENT, SUCH AMENDMENT ALTERS OR CHANGES THE
POWERS, PREFERENCES OR SPECIAL RIGHTS OF THE PREFERRED MEMBERSHIP UNITS, (III)
WITH RESPECT TO THE AMENDMENT OF THE BYLAWS OF THE MANAGEMENT COMPANY AND THIS
STOCKHOLDERS’ AGREEMENT, SUCH AMENDMENT ALTERS OR CHANGES THE POWERS,
PREFERENCES OR SPECIAL RIGHTS OF THE CLASS A COMMON STOCK OR THE CLASS B COMMON
STOCK;

 

(B)                                 TRANSACTIONS WITH AFFILIATES IN EXCESS OF
$5,000,000, PROVIDED THAT (I) THE OPERATING COMPANY NOTIFIES BOTH EARTHLINK AND
SKT WITH RESPECT TO ANY SUCH TRANSACTIONS AND (II) TO THE EXTENT THE AGGREGATE
OF ANY SUCH TRANSACTIONS BY AND BETWEEN SKT, AND/OR ITS AFFILIATED PARTIES, ON
ONE HAND, AND THE OPERATING COMPANY, ON THE OTHER HAND, EXCEEDS $10,000,000 ON A
CUMULATIVE ANNUAL BASIS (EXCLUDING FROM SUCH CALCULATION ANY TRANSACTIONS THAT
ARE APPROVED BY ALL CLASS B DIRECTORS AND A MAJORITY VOTE OF ALL DIRECTORS),
THEN ANY FURTHER TRANSACTIONS WITH AFFILIATES DURING SUCH YEAR SHALL BE DEEMED
STRATEGIC DECISIONS AND BE SUBJECT TO APPROVAL HEREIN;

 

(C)                                  ANY MODIFICATIONS OF SCHEDULES 8.1(A) OR
(B);

 

(D)                                 ANY ISSUANCE OF EQUITY OR MEMBERSHIP
INTEREST SENIOR TO THE CLASS B COMMON STOCK OR THE MEMBERSHIP UNITS, INCLUDING
ANY PREFERRED STOCK OR PREFERRED MEMBERSHIP UNITS;

 

(E)                                  ANY BANKRUPTCY MATTER; AND

 

(F)                                    EXCEPT IN CONNECTION WITH AN M&A
TRANSACTION, ANY EVENT WHICH RESULTS IN THE PRIMARY INVESTMENT VEHICLE OF THE
JOINT VENTURE (REPRESENTED BY THE OPERATING COMPANY AND THE MANAGEMENT COMPANY)
BECOMING A CORPORATION AS OPPOSED TO A LIMITED LIABILITY COMPANY, WHETHER SUCH
OCCURS BY MEANS OF A CONVERSION OF THE OPERATING COMPANY FROM A LIMITED
LIABILITY COMPANY TO A

 

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CORPORATION, A MERGER OF THE OPERATING COMPANY INTO THE MANAGEMENT COMPANY OR
OTHERWISE.

 

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Schedule 8.1(b)

 

The following matters, which list shall not be an exclusive list of matters
requiring the approval of the Board of Directors, shall be approved as provided
in Article 8 of this Stockholders’ Agreement by (i) a majority of Class B
Directors, and (ii) a majority vote of all directors:

 

(A)                                  INDEBTEDNESS (FOR MONEY BORROWED AND LEASE
OBLIGATIONS) IN EXCESS OF $5 MILLION, OUTSIDE OF ORDINARY COURSE TRADE DEBT;

 

(B)                                 DECLARATION AND PAYMENT OF DIVIDENDS OR
DISTRIBUTIONS;

 

(C)                                  DISTRIBUTION OF ANY OTHER WIMAX CONVERGENT
DEVICES, BETWEEN PC AND HANDSET DEVICES;

 

(D)                                 ANY M&A TRANSACTION;

 

(E)                                  APPROVAL OF ANNUAL BUSINESS PLAN AND
OPERATING BUDGET;

 

(F)                                    CHANGE IN SCOPE OF BUSINESS;

 

(G)                                 HIRING/FIRING (AND TERMS OF EMPLOYMENT) OF
EXECUTIVE OFFICERS;

 

(H)                                 DELEGATION AND CREATION OF ANY COMMITTEES OF
THE BOARD;

 

(I)                                     ACQUISITION OR DISPOSITION OF ASSETS
(INCLUDING, WITHOUT LIMITATION, SUBSIDIARIES, EQUITY, DEBT AND OTHER
INVESTMENTS, ETC.) IN EXCESS OF $5 MILLION;

 

(J)                                     NEW TECHNOLOGY PURCHASES/INVESTMENTS IN
EXCESS OF $5 MILLION;

 

(K)                                  ENTERING INTO ANY MATERIAL AGREEMENT IN
EXCESS OF $5 MILLION;

 

(L)                                     ADDITIONAL CAPITAL CONTRIBUTIONS;

 

(M)                               SELECTION OF INDEPENDENT AUDITORS FOR
FINANCIAL PURPOSES;

 

(N)                                 CREATION AND MANAGEMENT OF SIGNIFICANT
CORPORATE GOVERNANCE AND FINANCIAL POLICIES;

 

(O)                                 LOCATION OF CASH AND INVESTMENT HOLDINGS;

 

(P)                                 CHANGE IN THE NAME OF THE MANAGEMENT COMPANY
OR THE OPERATING COMPANY OR SIGNIFICANT BRANDING;

 

(Q)                                 SELECTION AND/OR RELOCATION OF HEADQUARTERS;

 

(R)                                    ESTABLISHMENT/CHANGE IN REGULATORY OR
PUBLIC POLICY POSITIONS;

 

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(S)                                  NEW PRODUCTS OR SERVICES OUTSIDE OF THE
BUSINESS PLAN;

 

(T)                                    ADOPTION OR CHANGE TO ANY MATERIAL
EMPLOYEE POLICIES INCLUDING THE ADOPTION OF AN EQUITY COMPENSATION PLAN;

 

(U)                                 NON-COMPETITION OR NON-SOLICITATION
AGREEMENTS BINDING THE OPERATING COMPANY;

 

(V)                                 MERGER, CONSOLIDATION OR REORGANIZATION THAT
IS NOT AN M&A TRANSACTION OR BANKRUPTCY MATTER; AND

 

(W)                               THE SUPPORT, PUBLIC OR IN CONFIDENCE, OF ANY
LAW, RULE OR REGULATION THAT MAY LIKELY HAVE A SIGNIFICANT IMPACT ON THE PRIMARY
BUSINESS OF EITHER EARTHLINK OR SKT.

 

Notwithstanding the foregoing, if the annual aggregate amount to be expended by
the Operating Company for marketing, inventory, business development or capital
expenditures is delineated within the Annual Budget approved by a majority of
Class B Directors, and a majority vote of all directors, in accordance with this
Schedule 8.1(b), but the aggregate annual amount to be spent on any such
category is greater than those limitations set forth under this Schedule 8.1(b)
but lower than the amount delineated in the Annual Budget, additional approvals
under Section 8.1 of this Stockholders’ Agreement for such aggregate
expenditures shall not be required. Notwithstanding the foregoing, the Board
wishes to be made aware of any material increases in any inventory expenditures.

 

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