Exhibit 10.26


 


AMENDED AND RESTATED


EMPLOYMENT AGREEMENT


 


THIS AMENDED
AND RESTATED EMPLOYMENT AGREEMENT (this “Agreement”) between EARTHLINK, INC., a
Delaware corporation (the “Company”), and ROLLA HUFF (referred to herein as
“You”) is entered into on December 15, 2008.  This Agreement amends, restates and
supersedes the Employment Agreement between the Company and You dated June 25,
2007 (the “Previous Agreement”).


 


RECITALS


 


1.             The
Company is engaged in the business of providing integrated communication services
and related value added services to individual consumers and business customers
throughout the States of the United States; and


 


2.             The
Company previously determined that, in view of Your knowledge, expertise and
experience in the integrated communication services and related value-added
services industries, Your services as the Chief Executive Officer and President
of the Company would be of great value to the Company, and accordingly, the
Company desired to enter into the Previous Agreement with You on the terms set
forth therein in order to secure Your services; and


 


3.             You
desired to serve as the Chief Executive Officer and President of the Company on
the terms set forth in the Previous Agreement; and


 


4.             The
Company and You now desire to amend and restate the Previous Agreement, as set
forth herein, to address Section 409A of the Code (as defined below) and
the final regulations issued thereunder.


 


NOW,
THEREFORE, in consideration of Your employment by the
Company, the above premises and the mutual agreements hereinafter set forth,
You and the Company agree as follows:


 


1.             Definitions.


 


(a)               “Affiliate”
means any trade or business with whom the Company would be considered a single
employer under Sections 414(b) or 414(c) of the Code (except that, for
purposes of determining Your Termination of Employment, the language “at least
fifty percent (50%)” shall be used instead of “at least eighty percent (80%)”
each place it appears in Sections 414(b) or 414(c) of the Code).


 


(b)               “Business
of the Company” means the business of providing integrated communication
services and related value added services to individual consumers and business
customers.


 


(c)               “Cause”
means (i) Your commission of any act of fraud or dishonesty relating to
and adversely affecting the business affairs of the Company; (ii) Your
conviction of any felony; or (iii) Your willful and continued failure to 


 

















 


perform substantially Your duties owed to the
Company after written notice specifying the nature of such non-performance and
a reasonable opportunity to cure such non-performance.  No act or omission shall be considered
“willful” unless it is done or omitted in bad faith or without reasonable
belief that the action or omission was in the best interests of the Company.


 


(d)               “Code”
means the Internal Revenue Code of 1986, as amended, and any regulations
promulgated thereunder.


 


(e)               “Company”
shall mean EarthLink, Inc.


 


(f)                “Confidential
Information” means any and all non-public information concerning, relating
to and/or in the possession of the Company and/or its Affiliates and/or the
Business of the Company treated as confidential or secret by the Company and/or
its Affiliates (that is, such business information is subject to efforts by the
Company and/or its Affiliates that are reasonable under the circumstances to
maintain its secrecy) that does not constitute a Trade Secret, including,
without limitation, information concerning the Company’s or an Affiliate’s
financial position and results of operations (including revenues, assets, net
income, etc.), annual and long range business plans, product and service plans,
marketing plans and methods, employee lists and information, in whatever form
and whether or not computer or electronically accessible.


 


(g)               “Eligible
Earnings” has the same meaning given to that term in the Company’s bonus
plan and payroll policies.


 


(h)               “Good
Reason” means, with respect to Your Termination of Employment, any of the
following acts or omissions that are not cured within thirty (30) days after
written notice of such act or omission is delivered to the Company, the
Chairman of the Board of Directors and the Chairman of the Leadership and
Compensation Committee of the Board of Directors (which notice must be given no
later than ninety (90) days after the initial occurrence of such event):


 


(1)           without Your express written consent (i) the
assignment to You of any duties materially inconsistent in any respect with
Your position, authority, duties or responsibilities as contemplated by Section 2,
(ii) the requirement by the Company that You report to any officer or
employee other than directly to the Board of Directors of the Company, (iii) any
other action by the Company that results in a significant diminution in such
position, authority, duties or responsibilities, provided that the Company’s no
longer being a reporting company with the Securities and Exchange Commission
shall not be deemed to result in such a significant diminution, or (iii) any
failure by the Company to comply in any material respect with any of the
provisions of Section 4(a), (b) and (d) of this Agreement;


 


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(2)           any requirement that You relocate
outside of, or any relocation of the Company’s principal executive office
outside of, the metropolitan area of Atlanta, Georgia; or


 


(3)           any breach by the Company of any
other material provision of this Agreement.


 


A termination by You shall not constitute
termination for Good Reason unless You resign within two (2) years after
the initial occurrence of such uncured event.


 


(i)  “Specified
Employee” means an employee who is (i) an officer of the Company or an
Affiliate having annual compensation greater than $145,000 (with certain
adjustments for inflation after 2008), (ii) a five-percent owner of the
Company or (iii) a one-percent owner of the Company having annual
compensation greater than $150,000.  For
purposes of this Section, no more than 50 employees (or, if lesser, the greater
of three or 10 percent of the employees) shall be treated as officers.  Employees who (i) normally work less
than 17 1/2 hours per week, (ii) normally work not more than 6 months
during any year, (iii) have not attained age 21, (iv) are included in
a unit of employees covered by an agreement which the Secretary of Labor finds
to be a collective bargaining agreement between employee representatives and
the Company or an Affiliate (except as otherwise provided in regulations issued
under the Code) or (v) who have not completed six months of service shall
be excluded for purposes of determining the number of officers for this
determination.  For purposes of this
Section, the term “five-percent owner” (“one-percent owner”) means any person
who owns more than five percent (one percent) of the outstanding stock of the
Company or stock possessing more than five percent (one percent) of the total
combined voting power of all stock of the Company.  For purposes of determining ownership, the
attribution rules of Section 318 of the Code shall be applied by
substituting “five percent” for “50 percent” in Section 318(a)(2) and
the rules of Sections 414(b), 414(c) and 414(m) of the Code
shall not apply.  For purposes of this
Section, the term “compensation” has the meaning given such term by Section 414(q)(4) of
the Code.  The determination of whether
You are a Specified Employee will be based on a December 31 identification
date such that if You satisfy the above definition of Specified Employee at any
time during the 12-month period ending on December 31, You will be treated
as a Specified Employee if You have a Termination of Employment during the
12-month period beginning on the first day of the fourth month following the
identification date.  This definition is
intended to comply with the “specified employee” rules of Section 409A(a)(2)(B)(i) of
the Code and shall be interpreted accordingly.


 


(j)  “Termination
of Employment” means the termination of Your employment and service with
the Company and all Affiliates.  You will
not be considered as having had a Termination of Employment if (i) You continue
to provide services to the Company or any Affiliate as an employee or
independent contractor at an annual rate that is more than 20 percent of the
services rendered, on average, during the immediately preceding 36 months of
employment (or, if employed less than 36 months, such lesser period) or (ii) You
are on military leave, 


 


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sick leave or other bona fide leave of
absence so long as the period of such leave does not exceed six months, or if
longer, so long as Your right to reemployment with the Company or any Affiliate
is provided either by statute or by contract. 
If the period of leave (i) ends or (ii) exceeds six months and
Your right to reemployment is not provided either by statute or by contract,
the Termination of Employment will be deemed to occur on the first date
immediately following such six-month period if not reemployed by the Company or
any Affiliate before such time and eligibility for payments and benefits
hereunder will be determined as of that time. 
Termination of Employment shall be construed consistent with the meaning
of a “separation from service” under Section 409A of the Code.


 


(k)               “Total
Disability” means Your inability, through physical or mental illness or
accident, to perform the majority of Your usual duties and responsibilities
hereunder (as such duties are constituted on the date of the commencement of
such disability) in the manner and to the extent required under this Agreement
for a period of at least ninety (90) consecutive days.  Total Disability shall be deemed to have
occurred on the first day following the expiration of such ninety (90) day
period.


 


(l)  “Trade
Secrets” means any and all information concerning, relating to and/or in
the possession of, the Company and/or its Affiliates and/or the Business of the
Company that qualifies as a trade secret as defined by the laws of the State of
Georgia on the date of this Agreement and as such laws are amended from time to
time thereafter.


 


2.             Employment; Duties.


 


(a)                The
Company agrees to employ You as Chief Executive Officer and President of the
Company with the duties and responsibilities generally associated with such
position and such other reasonable additional responsibilities and positions as
may be added to Your duties from time to time by the Board of Directors
consistent with Your position.


 


(b)                During
Your employment hereunder, You shall (i) diligently follow and implement
all Company employee policies and all management policies and decisions
communicated to You by the Board of Directors; and (ii) timely prepare and
forward to the Board of Directors all reports and accountings as may be
reasonably requested of You.


 


3.             Term. 
The term
hereof commenced on June 25, 2007, shall continue for a period of three (3) years
from such date and shall be automatically extended from year-to-year thereafter
unless terminated in accordance with Section 6 hereof (the “Term”).


 


4.             Compensation.


 


(a)                (1) 
You shall be paid an annual base salary of not less than Eight Hundred Thousand
Dollars ($800,000) per year (the “Base Salary”).  The Base Salary shall accrue and be due and
payable in equal, or as nearly equal as 


 


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practicable, biweekly installments and the
Company may deduct from each such installment all amounts required to be
deducted and withheld in accordance with applicable federal and state income,
FICA and other withholding tax requirements.


 


(2)  The Base Salary shall
be reviewed by the Board of Directors at least once during each year of the
Term and may be increased from time to time and at any time by the Board of
Directors.  The Base Salary shall in no
event be reduced or decreased below the highest level attained at any time by
You, unless You and the Board of Directors agree to implement a salary
reduction program for cost abatement purposes.


 


(3)  As the Term begins on
other than the first business day of a calendar month and as the Term hereof
shall terminate on other than the last day of a calendar month, Your compensation
for such month shall be prorated according to the number of days during such
month that occur within the Term.


 


(b)                For
each fiscal year of the Company, You shall be entitled to receive an annual
target bonus opportunity in an amount equal to one hundred percent (100%) of
Your Eligible Earnings (the “Annual Target Bonus”), with the ability to earn 50
percent (50%) (threshold) to One Hundred Fifty Percent (150%) (maximum) of Your
Annual Target Bonus if the bonus criteria for such annual period, as set by the
Board of Directors of the Company, are satisfied (the “Target Bonus Payment”);
provided that if such bonus criteria are not satisfied, no Annual Target Bonus
shall be payable.  The criteria to earn
Your Annual Target Bonus and other levels between the threshold and maximum for
each year of the Term shall be based upon good faith negotiations between You
and the Board of Directors.  All Target
Bonus Payments that become payable shall be paid to You in accordance with the
applicable bonus plan but in no event later than 21⁄2 months after the end of the
fiscal year of the Company to which Your Target Bonus Payments relate.


 


(c)                While
You are performing the services described herein, the Company shall reimburse
You for all reasonable and necessary expenses incurred by You in connection
with the performance of Your duties of employment hereunder in accordance with
the Company’s expense reimbursement policy, as applied to the Company’s
executive officers, as soon as administratively practicable but no later than 2
1⁄2 months after the end of the year in which You incur the reimbursable expense.


 


(d)                Pursuant
to this Section 4(d), You shall participate in the Change-In-Control
Accelerated Vesting and Severance Plan amended and restated effective December 15,
2008 and any plan(s) or program(s) that supersede, replace and/or
supplement such plan, as in effect from time to time (the “AV/SP”), at the
highest and most beneficial level of participation provided under the
AV/SP.  With respect to each individual benefit,
or category of similar benefit, provided to You under each of the AV/SP and
this Agreement, the two (2) benefits shall not be cumulative, and You
shall be entitled to receive each such benefit, or category of benefit, under
the terms of the AV/SP or the terms of this Agreement, whichever would be the
greater amount or value to You, except that the timing and manner of payment of



 


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such benefits shall be consistent with the
terms of this Agreement, regardless of whether the amount or value of the
benefits You are entitled to receive are determined under the AV/SP or this
Agreement.  The restrictions on
cumulation of benefits in this Section 4(d), and the application of the
terms of the AV/SP to benefits provided thereunder, shall not apply to Your
right to qualify for and participate in the AV/SP at the highest and most
beneficial level of participation.


 


(e)                You
shall receive paid vacation during each twelve (12) month period of Your
employment in accordance with the Company’s vacation policy.  To the extent that You do not use Your
accrued vacation during such twelve (12) month period, any remaining accrued
vacation shall be subject to the carryover restrictions applicable in the
Company’s normal vacation policies.


 


5.             Equity Rights.


 


(a)                Upon
execution of the Previous Agreement, You received 100,000 RSUs which shall vest
in accordance with the terms of the EarthLink, Inc. 2006 Equity and Cash
Incentive Plan, with 50,000 RSUs vesting on June 25, 2009, 25,000 RSUs
vesting on June 25, 2010 and 25,000 RSUs vesting on June 25, 2011,
assuming Your continued employment until each such time, or as otherwise vested
pursuant to Section 6.  Upon execution of the Previous
Agreement, You also received (1) 700,000 stock options which vested as of September 30,
2007 and (ii) 800,000 stock options which vest over a period of four years
in accordance with the terms of the EarthLink, Inc. 2006 Equity and Cash
Incentive Plan, with 300,000 stock options vesting on December 31, 2008
and the remaining 500,000 stock options vesting on a monthly basis between January 1,
2009 and June 25, 2011, assuming Your continued employment until each such
time, or as otherwise vested pursuant to Section 6.


 


(b)                The
stock options and restricted stock units granted by the Company to You from
time to time are hereinafter collectively called the “Stock Options and
RSUs.”  You shall be given the period
permitted under Your respective Stock Option agreements, which shall contain
the material terms provided in the form attached to this Agreement, to exercise
Your Stock Options after Your termination of employment.


 


(c)                Vested
Stock Options shall be exercisable for ninety (90) days following termination
of employment, provided that if You are prohibited from exercising vested stock
options during such ninety (90) day period due to having material non-public
information about the Company, such exercise period shall be extended until ten
(10) days following the date that You no longer have material non-public
information about the Company, but in no event shall the vested Stock Options
be exercisable beyond their latest expiration date as set forth in the
respective Stock Option agreements.


 


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6.             Termination.


 


(a)                A
Termination of Employment shall occur only as follows:


 


(1)           For Cause immediately by the Company; or


 


(2)           At Your option for Good Reason; or


 


(3)           At Your option upon thirty (30) days prior written notice
of termination delivered by You to the Company; or


 


(4)           For any reason by the Company upon three (3) calendar
months prior written notice of termination delivered to You, except during a
period of Your disability that may qualify as the period for qualification for
Your Termination of Employment due to Your Total Disability as set forth in Section 6(a)(6);
or


 


(5)           By the Company upon Your death; or


 


(6)           By the Company because of Your Total Disability upon
thirty (30) days prior written notice of termination delivered to You.


 


(b)                If
You have a Termination of Employment that is (i) by the Company for other
than “Cause,” Your death or Your Total Disability, or (ii) by You for
“Good Reason,” You shall be paid an amount equal to (a) two hundred
percent (200%) of the sum of (i) Your Base Salary as of the effective date
of Your Termination of Employment and (ii) Your Annual Target
Bonus for the year in which Your Termination of Employment occurs, less (b) the
amount of the Non-Compete Payment.  Subject to Section 19 below, such amount
shall be paid in equal, or as nearly equal as practicable, biweekly
installments, starting with the first payroll payment date following Your
Termination of Employment as described in this Section 6(b) and
continuing thereafter for eighteen (18) months. 
In the event of such Termination of Employment, You shall become
immediately vested in all Your outstanding Stock Options and RSUs, and for
eighteen (18) months following Termination of Employment the Company shall pay,
no less frequently than monthly, all costs of health care continuation coverage
for which You and Your spouse and dependents are eligible under the
Consolidated Omnibus Budget Reconciliation Act of 1986.


 


(c)                If
You have a Termination of Employment on account of Your death or Your Total
Disability, You shall be paid (i) one hundred percent (100%) of Your Base
Salary as of the effective date of Your Termination of Employment, such amount
to be paid in equal, or as nearly equal as practicable, biweekly installments,
starting with the first payroll payment date following Your Termination of
Employment and continuing thereafter for eighteen (18) months (subject to any
delay in payments that may be required by Section 19), and (ii) Your
Annual Target Bonus for the year in which Your Termination of Employment
occurs, such Annual 


 


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Target Bonus to be determined in accordance
with Section 4(b) and to be payable in accordance with the last
sentence of Section 4(b).


 


(d)                If
You have a Termination of Employment by the Company for Cause or by You for
reasons other than for “Good Reason,” the Company will have no obligations to
pay You any amount beyond the effective date of such Termination of Employment
whether as Base Salary, Annual Target Bonus or otherwise or to provide You with
any benefits arising hereunder or otherwise except as required by law.


 


7.             Confidential Information and
Trade Secrets.  You acknowledge that the nature
of Your engagement by the Company is such that You shall have access to the
Confidential Information and the Trade Secrets, each of which has great value
to the Company, provides the Company a competitive advantage, and constitutes
the foundation upon which the Business of the Company is based.  You agree to hold all of the Confidential
Information and the Trade Secrets in confidence and to not use, disclose, publish
or otherwise disseminate any of such Confidential Information and the Trade
Secrets to any other person, except to the extent such disclosure is
(i) necessary to the performance of this Agreement and in furtherance of
the Company’s best interests, (ii) required by applicable law,
(iii) as a result of portions of the Confidential Information and/or the
Trade Secrets becoming lawfully obtainable from other sources,
(iv) authorized in writing by the Company, or (v) necessary to enforce
this Agreement.  The restrictions set
forth in this Section 7 shall remain in full force and effect
(a) with respect to the Confidential Information, for the three
(3) year period following the effective date of Your Termination of
Employment, and with respect to the Trade Secrets, until the Trade Secrets no
longer retain their status or qualify as trade secrets under applicable
law.  Upon Your Termination of
Employment, You shall deliver to the Company all documents, records, notebooks,
work papers, and all similar material containing Confidential Information and
Trade Secrets, whether prepared by You, the Company or anyone else.


 


8.             Inventions and Patents. 
All
inventions, designs, improvements, patents, copyrights and discoveries
conceived by You during the term of this Agreement which are useful in or
directly or indirectly relate to the business of the Company or to any
experimental work carried on by the Company, shall be the property of the
Company.  You agree to promptly and fully
disclose to the Company all such inventions, designs, improvements, patents,
copyrights and discoveries (whether developed individually or with other
persons) and at the Company’s expense, to take all steps necessary and
reasonably required to assure the Company’s ownership thereof and to assist the
Company in protecting or defending the Company’s proprietary rights therein.


 


9.             Restrictive Covenants.


 


(a)                Non-Competition.  You agree that during Your employment, and
for a period of eighteen (18) calendar months following Termination of
Employment, You shall not perform within the 50 states of the United States of
America any services which are in competition with the Business of the Company
during Your employment, or following Your Termination of Employment any
services which are in competition with a Material line of Business engaged in
by the 


 


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Company at the time of Your Termination of
Employment, and which are the same as or similar to those services You
performed for the Company under this Agreement; provided, however, if the other
business competitive with the Business of the Company has multiple lines,
divisions, segments or units, some of which are not competitive with the
Business of the Company, nothing herein shall prevent You from being employed
by or providing services to such line, division, segment or unit that is not
competitive with the Business of the Company. 
For purposes of this Section 9(a), “Material” means a line of
Business that represents 20% or more of the Company’s consolidated revenues or
adjusted EBITDA for the four fiscal quarters immediately preceding Your
Termination of Employment.


 


(b)                Non-Recruitment.  You agree that during Your employment and for
a period of eighteen (18) calendar months following Termination of Employment,
You will not, directly or indirectly: 
(1) solicit, induce, recruit, or cause a Restricted Employee to
resign employment with the Company or its Affiliates, or (2) participate
in making hiring decisions, encourage the hiring of, or aid in the hiring
process of a Restricted Employee on behalf of any employer other than the
Company and its Affiliates.  As used
herein, “Restricted Employee” means any employee of the Company or its
Affiliates with whom You had material business-related contact while performing
services under this Agreement, and who is: 
(1) a member of executive management; (2) a corporate officer
of the Company or any of its Affiliates, or (3) any employee of the
Company or any of its Affiliates engaged in product or service development or
product or service management.


 


(c)                Effect
of Breach.  The obligation of the
Company to continue to fulfill its payment and benefit obligations to You
pursuant to Sections 6(b), 6(c) and 9(d) is conditioned upon Your
compliance with the provisions of this Section 9 and Sections 7 and
8.  Accordingly, in the event that You
shall materially breach the provisions of this Section 9 and/or
Sections 7 and/or 8 and not cure or cease (as appropriate) such material
breach within ten (10) days of receipt of notice thereof from the Company,
the Company’s obligations under Sections 6(b), 6(c) and 9(d) shall
terminate.  Termination of the Company’s
obligations under Sections 6(b), 6(c) or 9(d) shall not be the
Company’s sole and exclusive remedy for a breach of this Section 9 and/or
Sections 7 and/or 8.  In addition to
the remedy provided in this Section 9(c), the Company shall be entitled to
seek damages and injunctive relief to enforce this Section 9 and
Sections 7 and 8, in the event of a breach by You of this Section 9
and/or Sections 7 and/or 8. 
Additionally, in the event You materially breach such provisions, You
shall be required to repay to the Company all such amounts paid pursuant to
Sections 6(b), 6(c) and 9(d) that You would not have received had
such amount not been paid and You breached such provisions.


 


(d)                Compensation
for Restrictive Covenants.  In
consideration of Your obligations under this Section 9, upon Your
Termination of Employment other than on account of Your death or Total
Disability or by the Company for “Cause” or by You for reasons other than “Good
Reason,” You shall be paid an amount equal to one million five hundred thousand
dollars ($1,500,000) (the “Non-Compete Payment”).  Subject to Section 19 below, such amount
shall be paid in equal, or as 


 


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nearly equal as practicable, biweekly
installments, starting with the first payroll payment date following Your
Termination of Employment other than on account of Your death or Total Disability
or by the Company for “Cause” or by You for reasons other than “Good Reason,”
and continuing thereafter for the eighteen (18) month restriction period.


 


10.          Remedies.


 


(a)                The
parties hereto agree that the services to be rendered by You pursuant to this
Agreement, and the rights and privileges granted to the Company pursuant to
this Agreement, are of a special, unique, extraordinary and intellectual
character, which gives them a peculiar value; the loss of which cannot be
reasonably or adequately compensated in damages in any action at law, and that
a breach by You of any of the terms of this Agreement will cause the Company
great and irreparable injury and damage. 
You hereby agree that the definition of the Business of the Company set
forth in Section 1 is correct, that the Company and its Affiliates conduct
business throughout the 50 states of the United States of America and beyond,
and that these restrictions are reasonably necessary to protect the legitimate
business interests of the Company.  You
hereby expressly agree that the Company shall be entitled to the remedies of
injunction, specific performance and other equitable relief to prevent a breach
of this Agreement by You.  This
Section 10 shall not be construed as a waiver of any other rights or remedies
which the Company may have for damages or otherwise.


 


(b)                In
the event of any dispute over the interpretation or application of this
Agreement, the Company shall reimburse You for Your reasonable attorneys’ fees
and costs incurred in connection with that dispute unless the Company is
determined, by final judgment of a court of competent jurisdiction, to be the
prevailing party on all or substantially all of the issues in dispute, which
reimbursement shall be made promptly (and within thirty (30) days) following
final judgment.


 


11.          Construction and Severability. 
The
parties hereto agree that the provisions of this Agreement shall be presumed to
be enforceable, and any reading causing unenforceability shall yield to a
construction permitting enforcement.  In
the event a court should determine not to enforce a provision of this Agreement
due to overbreadth, violation of public policy, or similar reasons, the parties
specifically authorize such reviewing court to enforce said covenant to the
maximum extent reasonable, whether said revisions be in time, territory, scope
of prohibited activities, or other respects. 
If any single covenant, provision, word, clause or phrase in this
Agreement shall be found unenforceable, it shall be severed and the remaining
covenants and provisions enforced in accordance with the tenor of the
Agreement.


 


12.          Assignment.  This Agreement and the rights
and obligations of the hereunder may not be assigned by either party hereto
without the prior written consent of the other party hereto.


 


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13.          Notices. 
Except
as otherwise specifically provided herein, any notice required or permitted to
be given to You pursuant to this Agreement shall be given in writing, and
personally delivered or mailed to You by certified mail, return receipt
requested, at the address set forth below Your signature on this Agreement or
at such other address as You shall designate by written notice to the Company
given in accordance with this Section 13, and any notice required or
permitted to be given to the Company, the Chairman of the Board of Directors or
the Chairman of the Leadership and Compensation Committee of the Board of
Directors shall be given in writing, and personally delivered or mailed to that
recipient by certified mail, return receipt requested, addressed to the
appropriate recipient at the address set forth under the signature of the
Executive Vice President of the Company or his designee on this Agreement or at
such other address as the Company shall designate by written notice to You
given in accordance with this Section 13. 
Any notice complying with this Section 13 shall be deemed received
upon actual receipt by the addressee.


 


14.          Waiver. 
The
waiver by either party hereto of any breach of this Agreement by the other
party hereto shall not be effective unless in writing, and no such waiver shall
operate or be construed as the waiver of the same or another breach on a
subsequent occasion.


 


15.          Governing Law. 
This
Agreement and the rights of the parties hereunder shall be governed by and
construed in accordance with the laws of the State of Georgia.


 


16.          Beneficiary. 
All of
the terms and provisions of this Agreement shall be binding upon and inure to
the benefit of and be enforceable by the parties hereto and their respective
successors, heirs, executors, administrators and permitted assigns.


 


17.          Entire Agreement. 
This
Agreement embodies the entire agreement of the parties hereto relating to Your
employment by the Company in the capacity herein stated and, except as
specifically provided herein, no provisions of any employee manual, personnel
policies, Company directives or other agreement or document shall be deemed to
modify the terms of this Agreement.  No
amendment or modification of this Agreement shall be valid or binding upon You
or the Company unless made in writing and signed by the parties hereto.  All prior understandings and agreements
relating to Your employment by the Company, in whatever capacity, are hereby
expressly terminated.


 


18.          Excise Tax.


 


(a)                If
any payment or distribution by the Company and/or any Affiliate of the Company
to or for Your benefit, whether paid or payable or distributed or distributable
pursuant to the terms of this Agreement or otherwise pursuant to or by reason
of any other agreement, policy, plan, program or arrangement, including without
limitation any stock option, stock appreciation right or similar right, or the
lapse or termination of any restriction on or the vesting or exercisability of
any of the foregoing (a “Payment”), would be subject to the excise tax imposed
by Section 4999 of the Code or to any similar tax imposed by state or
local law, or any interest or penalties with respect to such tax (such tax or
taxes, together with any such interest and penalties, being hereafter
collectively referred to as the “Excise Tax”), then the payments and benefits
payable or provided under this Agreement (or other 


 


11

















 


Payments as described below) shall be reduced
(but not below the amount of the payments or benefits provided under this
Agreement) if, and only to the extent that, such reduction will allow You to
receive a greater Net After Tax Amount than You would receive absent such
reduction.


 


(b)                The
Accounting Firm will first determine the amount of any Parachute Payments (as
defined below) that are payable to You. 
The Accounting Firm also will determine the Net After Tax Amount (as
defined below) attributable to Your total Parachute Payments.


 


(c)                The
Accounting Firm will next determine the largest amount of Payments that may be
made to You without subjecting You to the Excise Tax (the “Capped
Payments”).  Thereafter, the Accounting
Firm will determine the Net After Tax Amount attributable to the Capped
Payments.


 


(d)                You
then will receive the total Parachute Payments or the Capped Payments or such
other amount less than the total Parachute Payments, whichever provides You
with the higher Net After Tax Amount, but in no event will any such reduction
imposed by this Section 18 be in excess of the amount of payments or
benefits payable or provided under this Agreement.  If You will receive the Capped Payments or
some other amount lesser than the total Parachute Payments, the total Parachute
Payments will be adjusted by first reducing the amount of any noncash benefits
under this Agreement or any other plan, agreement or arrangement on a pro rata
basis and then by reducing the amount of any cash benefits under this Agreement
or any other plan, agreement or arrangement on a pro rata basis.  The Accounting Firm will notify You and the
Company if it determines that the Parachute Payments must be reduced and will
send You and the Company a copy of its detailed calculations supporting that
determination.


 


(e)                As
a result of the uncertainty in the application of Code Sections 280G and 4999
at the time that the Accounting Firm makes its determinations under this
Section 18, it is possible that amounts will have been paid or distributed
to You that should not have been paid or distributed under this Section 18
(“Overpayments”), or that additional amounts should be paid or distributed to
You under this Section 18 (“Underpayments”).  If the Accounting Firm determines, based on
either the assertion of a deficiency by the Internal Revenue Service against
the Company or You, which assertion the Accounting Firm believes has a high
probability of success or controlling precedent or substantial authority, that
an Overpayment has been made, that Overpayment will be treated for all purposes
as a debt ab initio that You must repay to the
Company together with interest at the applicable Federal rate under Code
Section 7872; provided, however, that no debt will be deemed to have been
incurred by You and no amount will be payable by You to the Company unless, and
then only to the extent that, the deemed debt and payment would either reduce
the amount on which You are subject to tax under Code
Section 4999 or generate a refund of tax imposed under Code Section 4999.  If the Accounting Firm determines, based upon
controlling precedent or substantial authority, that an Underpayment has
occurred, the Accounting Firm will notify You 


 


12

















 


and the Company of that determination and the
amount of that Underpayment will be paid to You promptly (and no later than
thirty (30) days after the final determination of the Underpayment) by the
Company.


 


(f) For
purposes of this Section 18, the following terms shall have their
respective meanings:


 


(i)            “Accounting Firm” means the· independent accounting firm
engaged by the Company in the Company’s sole discretion.


 


(ii)           “Net After Tax Amount” means the amount of any Parachute
Payments, Capped Payments or other payments described in this Section 18,
as applicable, net of taxes imposed under Code Sections 1, 3101(b) and
4999 and any State or local income taxes applicable to You on the date of
payment.  The determination of the Net
After Tax Amount shall be made using the highest combined effective rate
imposed by the foregoing taxes on income of the same character as the Parachute
Payments or Capped Payments, as applicable, in effect on the date of payment.


 


(iii)          “Parachute Payment” means a payment that is described in
Code Section 280G(b)(2), determined in accordance with Code
Section 280G and the regulations promulgated or proposed thereunder.


 


(g)                The
fees and expenses of the Accounting Firm for its services in connection with
the determinations and calculations contemplated by the preceding subsections
shall be borne by the Company.  If such
fees and expenses are initially paid by You, the Company shall reimburse You
the full amount of such fees and expenses within five business days after
receipt from You of a statement therefore and reasonable evidence of Your
payment thereof but in no event later than the end of the year immediately
following the year in which You incur such reimbursable fees and expenses.


 


(h)                The
Company and You shall each provide the Accounting Firm access to and copies of
any books, records and documents in the possession of the Company or You, as
the case may be, reasonably requested by the Accounting Firm, and otherwise
cooperate with the Accounting Firm in connection with the preparation and
issuance of the determinations and calculations contemplated by the preceding
subsections.  Any determination by the
Accounting Firm shall be binding upon the Company and You.


 


(i) The federal, state and local income
or other tax returns filed by You shall be prepared and filed on a consistent
basis with the determination of the Accounting Firm with respect to the Excise
Tax payable by You.  You, at the request
of the Company, shall provide the Company true and correct copies (with any
amendments) of Your federal income tax return as filed with the Internal
Revenue Service and corresponding state and local tax returns, if relevant, as
filed with the 


 


13

















 


applicable taxing authority, and such other
documents reasonably requested by the Company, evidencing such conformity.


 


(j)  All
payments to be made to You under this Section 18 must be paid no earlier
than when the applicable taxes are to be remitted and by the end of Your
taxable year next following the year in which the taxes that are the subject of
the audit or litigation are remitted to the taxing authorities or, where no
such taxes are remitted, the end of Your taxable year following the year in
which the audit is completed or there is a final and non-appealable settlement
or the resolution of the litigation.


 


19.          Tax Liabilities and Code
Section 409A.  Any payments or benefits that You receive
pursuant to this Agreement shall be subject to reduction for any applicable
employment or withholding taxes. 
Notwithstanding any other provision of this Plan, if You are a Specified
Employee as of Your Termination of Employment, and if the amounts that You are
entitled to receive pursuant to Section 6 or Section 9 are not
otherwise exempt from Section 409A of the Code, then to the extent necessary
to comply with Section 409A, no payments for such amounts may be made
under this Agreement (including, if necessary, any payments for welfare or
other benefits in which case You may be required to pay for such coverage or
benefits and receive reimbursement when payment is no longer prohibited) before
the date which is six (6) months after Your Termination of Employment or,
if earlier, Your date of death.  All such
amounts, which would have otherwise been required to be paid over such six
(6) months after Your Termination of Employment or, if earlier, until Your
date of death, shall be paid to You in one lump sum payment as soon as
administratively feasible after the date which is six (6) months after
Your Termination of Employment or, if earlier, Your date of death.  All such remaining payments shall be made as
if they had begun as set forth in this Agreement.  For purposes of this Agreement, Your rights
to payments shall be treated as rights to receive a series of separate payments
to the fullest extent allowable under Section 409A of the Code.  This Agreement is intended to comply with the
applicable requirements of Section 409A of the Code and shall be construed
and interpreted in accordance therewith. 
The Company may at any time amend, suspend or terminate this Agreement,
or any payments to be made hereunder, as necessary to be in compliance with
Section 409A of the Code to avoid the imposition on You of any potential
excise taxes relating to Section 409A. 
To the extent that You incur liability for excise taxes, penalties or
interest under Section 409A of the Code because any nonqualified deferred
compensation plan of the Company fails to comply with Section 409A, the
Company will make a special reimbursement payment to You equal to the sum of
(i) Your liability for excise taxes, penalties or interest under
Section 409A and (ii) all taxes attributable to the special
reimbursement payment, at the time such taxes, penalties and interest are
required to be remitted to the applicable authorities.


 


14

















 


IN WITNESS WHEREOF,
You and the Company have executed and delivered this Agreement as of
the date first shown above.


 


	
  YOU:

  	
   

  	
  THE COMPANY:

  
	
   

  	
   

  	
   

  
	
  ROLLA HUFF

  	
   

  	
  EARTHLINK, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Rolla
  Huff

  	
   

  	
  By:

  	
  /s/ Susan D.
  Bowick

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Address:

  	
  1375
  Peachtree Street

  	
   

  	
  Name:

  	
  Susan D.
  Bowick

  
	
   

  	
  Atlanta, GA
  30309

  	
   

  	
  Title:

  	
  Chairperson
  - Leadership and Compensation 

  
	
   

  	
   

  	
   

  	
  Committee

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Address:

  	
  1375
  Peachtree Street

  
	
   

  	
   

  	
   

  	
  7-North

  
	
   

  	
   

  	
   

  	
  Atlanta, GA
  30309

  
						



 


15