Exhibit 10.27


 


AMENDED AND RESTATED

EMPLOYMENT AGREEMENT


 


THIS AMENDED
AND RESTATED EMPLOYMENT AGREEMENT (this “Agreement”) between EARTHLINK, INC., a
Delaware corporation (the “Company”), and JOSEPH M. WETZEL (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 August 27,
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 Operating Officer 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 Operating Officer 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 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)        “Beneficial
Ownership” means beneficial ownership as that term is used in Rule 13d-3
promulgated under the Securities Exchange Act of 1934, as amended.


 


(c)        “Business
Combination” means a reorganization, merger or consolidation of the
Company.


 

















 


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


 


(e)        “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.


 


(f)         “Change
in Control Event” of the Company means the occurrence of any of the
following events:


 


(1)           The accumulation in any number of
related or unrelated transactions by any Person of Beneficial Ownership of more
than fifty percent (50%) of the combined voting power of the Company’s Voting
Stock; provided that for purposes of this subparagraph (1), a Change in Control
Event will not be deemed to have occurred if the accumulation of more than
fifty percent (50%) of the voting power of the Company’s Voting Stock results
from any acquisition of Voting Stock (a) by the Company, (b) by any
employee benefit plan (or related trust) sponsored or maintained by the Company
or any Affiliate, or (c) by any Person pursuant to a Business Combination
that complies with clauses (a) and (b) of subparagraph (2) below;
or


 


(2)           Consummation of a Business
Combination, unless, immediately following that Business Combination, (a) all
or substantially all of the Persons who were the beneficial owners of Voting
Stock of the Company immediately prior to that Business Combination
beneficially own, directly or indirectly, more than fifty percent (50%) of the
then outstanding shares of common stock and more than fifty percent (50%) of
the combined voting power of the then outstanding Voting Stock entitled to vote
generally in the election of directors of the entity resulting from that
Business Combination (including, without limitation, an entity that as a result
of that transaction owns the Company or all or substantially all of the Company’s
assets either directly or through one or more subsidiaries) in substantially
the same proportions relative to each other as their ownership, immediately
prior to that Business Combination, of the common stock and Voting Stock of the
Company, and (b) at least sixty percent (60%) of the members of the Board
of Directors of the entity resulting from that Business Combination holding at
least sixty percent (60%) of the voting power of such Board of Directors were
members of the Incumbent Board at the time of the execution of the initial
agreement or of the action of the Board of Directors providing for that
Business Combination and as a result of or in connection with such Business
Combination, no Person has a right to dilute either of such 


 


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percentages by appointing additional members
to the Board of Directors or otherwise without election or other action by the
stockholders; or


 


(3)           A sale or other disposition of all or
substantially all of the assets of the Company, except pursuant to a Business
Combination that complies with clauses (a) and (b) of subparagraph (2) above;
or


 


(4)           Approval by the shareholders of the Company of a complete
liquidation or dissolution of the Company, except pursuant to a Business
Combination that complies with clauses (a) and (b) of subparagraph 2
above.


 


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


 


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


 


(i)         “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.


 


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


 


(k)        “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 Chief Executive Officer, the President of
the Company (excluding a President of any division of the Company) or 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 (iv) any failure 


 


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by the Company to comply in any material
respect with any of the provisions of Sections 4(a), (b) and (d) of
this Agreement;


 


(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.


 


(l)         “Incumbent
Board” means a Board of Directors consisting of individuals who either are (a) members
of the Company’s Board of Directors on the date hereof or (b) members who
become members of the Company’s Board of Directors subsequent to the date
hereof whose election, or nomination for election by the Company’s
shareholders, was approved by a vote of at least sixty percent (60%) of the
directors then comprising the Incumbent Board (either by a specific vote or by
approval of the proxy statement of the Company in which that Person is named as
a nominee for director, without objection to that nomination), but excluding,
for that purpose, any individual whose initial assumption of office occurs as a
result of an actual or threatened election contest (within the meaning of Rule 14a-11
of the Securities Exchange Act of 1934, as amended) with respect to the
election or removal of directors or other actual or threatened solicitation of
proxies or consents by or on behalf of a Person other than the Board of
Directors.


 


(m)       “Non-Public
Change in Control Event” means any Change in Control Event that is not a
Public Change in Control Event.


 


(n)        “Person”
means any individual, entity or group within the meaning of Section 13(d)(3) or
14(d)(2) of the Securities Exchange Act of 1934, as amended.


 


(o)        “Public Change in Control
Event” means any Change in Control Event as defined in clause (f) above
where (i) the Person that accumulates
Beneficial Ownership of more than fifty percent (50%) of the combined voting
power of the Company’s Voting Stock has, or such Person is a direct or indirect
subsidiary of a Person that has, a class of common stock (or depositary
receipts or other certificates representing common equity interests) traded on
a U.S. national securities exchange or quoted on NASDAQ or another established
over-the-counter trading market in the United States or which will be so traded
or quoted when issued or exchanged in connection with such Change in Control
Event or (ii) upon the consummation of such Change in Control Event, the
Voting Stock of the Company will remain trading on a U.S. national securities
exchange or quoted on NASDAQ or another established over-the-counter trading
market in the United States.


 


(p)        “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 


 


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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)(C) 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.


 


(q)        “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, 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.


 


(r)         “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 


 


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(90) consecutive days.  Total Disability shall be deemed to have
occurred on the first day following the expiration of such ninety (90) day
period.


 


(s)        “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.


 


(t)         “Voting
Stock” means the then outstanding securities of an entity entitled to vote
generally in the election of members of that entity’s Board of Directors.


 


2.             Employment;
Duties.


 


(a)        The
Company agrees to employ You as Chief Operating Officer 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 Chief Executive Officer, the President of
the Company (excluding a President of any division of the Company) or 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 Chief Executive Officer, the President or the Board
of Directors; and (ii) timely prepare and forward to the Chief Executive
Officer, the President or the Board of Directors all reports and accountings as
may be reasonably requested of You.


 


3.             Term.  The term hereof commenced on August 27,
2007, continued for a period of one (1) year, was extended for an
additional year from the anniversary of August 27, 2007 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 Four Hundred and
Sixteen Thousand Dollars ($416,000) per year (the “Base Salary”).  The Base Salary shall accrue and be due and
payable in equal, or as nearly equal as 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.


 


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(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 sixty-five percent (65%) of Your
Eligible Earnings (the “Annual Target Bonus”), with the ability to earn Fifty
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
second highest and second 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 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 second highest and second 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 


 


7

















 


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 50,000 RSUs which shall vest
in accordance with the terms of the EarthLink, Inc. 2006 Equity and Cash
Incentive Plan, with 25,000 RSUs vesting on August 27, 2009, 12,500 RSUs
vesting on August 27, 2010 and 12,500 RSUs vesting on August 27,
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 150,000 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 and the Company’s standard vesting schedule for stock
options.


 


(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 to exercise Your Stock Options after
Your termination of employment, except as otherwise provided in Section 5(c) below.


 


(c)        Vested Stock Options
shall be exercisable for thirty (30) days following termination of employment
but in no event beyond the latest expiration date as set forth in the
respective Stock Option agreement.


 


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.


 


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(b)        If
You have a Termination of Employment that is not in connection with a Change in
Control Event (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 one hundred percent (100%) 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.  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. 
However, You will not be entitled to any payment under this Section 6(b) if
you previously received payments under Section 6(c) below.  In addition, in the event of such Termination
of Employment as described in this Section 6(b), You shall become
immediately vested in all Your outstanding Stock Options and RSUs that
otherwise would have vested during the 18-month period immediately following
such Termination of Employment.


 


(c)        If a
Non-Public Change in Control Event occurs (and such Non-Public Change-in-Control
constitutes a “change in control event” within the meaning of Section 409A
of the Code and
applicable regulations) and you have not previously incurred a Termination of
Employment, You shall be paid as soon as administratively practicable (and
within thirty (30) days) after such Change in Control Event an amount equal to
one hundred and fifty percent
(150%) of
the sum of (i) Your Base Salary as of the effective date of the Non-Public
Change in Control Event and (ii) Your Annual Target Bonus for the year in
which the Non-Public Change in Control Event occurs.  In the event You receive any payments under
this Section 6(c), Your right to receive payments under Sections 6(b) and
6(d) will be terminated.


 


(d)        If, in connection with
a Public Change in Control Event (or a Non-Public Change-in-Control that does
not meet the
definition of a “change
in control event” in Section 409A of the Code and applicable regulations), You have a Termination of
Employment (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) one hundred and fifty percent (150%) 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.  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(d) and continuing
thereafter for eighteen (18) months. 
However, You will not be entitled to any payment under this Section 6(d) if
you have received payments under Section 6(c) above.


 


(e)        If
You have a Termination of Employment by the Company for Cause, Your death or
Your Total Disability 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.


 


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(f)         For
purposes of this Section 6, Your Termination of Employment will be deemed
to be in connection with a Change in Control Event if it occurs on or after the
Change in Control Event or after the public announcement of or execution of a
definitive agreement for a transaction or event that would, if consummated, be
a Change in Control Event.


 


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 twelve (12) 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
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


 


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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 twelve (12) 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 6(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 6(d) shall
terminate.  Termination of the Company’s
obligations under Sections 6(b), 6(c) and 6(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 6(d) that You would not have received had
such amount not been paid and You breached such provisions.


 


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


 


11

















 


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.


 


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 Chief Executive Officer 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.


 


12

















 


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 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


 


13

















 


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 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.


 


14

















 


(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
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
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


 


15

















 


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.


 


16

















 


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


 


	
  YOU:

  	
   

  	
  THE COMPANY:

  
	
   

  	
   

  	
   

  
	
  JOSEPH M. WETZEL

  	
   

  	
  EARTHLINK, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Joseph
  M. Wetzel

  	
   

  	
  By:

  	
  /s/ Rolla
  Huff

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Address:

  	
  1375
  Peachtree Street

  	
   

  	
  Name:

  	
  Rolla Huff

  
	
   

  	
  Atlanta, GA
  30309

  	
   

  	
  Title:

  	
  Chief
  Executive Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Address:

  	
  1375
  Peachtree Street

  
	
   

  	
   

  	
   

  	
  7-North

  
	
   

  	
   

  	
   

  	
  Atlanta, GA
  30309

  
						



 


17