Exhibit 10.4


 




 





 


FORM OF


 


AMENDED AND RESTATED


 


STOCKHOLDERS’ AGREEMENT


 


by and among


 


SK TELECOM CO., LTD.;


 


EARTHLINK, INC.;


 


and


 


HELIO, INC.


 


 


 


 


Dated as of                
      , 2007


 




 





 

















 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


ARTICLE
1

DEFINITIONS


 


1.1.         Certain Definitions.
Capitalized terms that are used but not otherwise defined herein shall have the
meanings given to them in the Operating Agreement. For the purposes of this
Stockholders’ Agreement, the following terms shall have the following meanings:


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


“Person”
shall mean any natural person or Entity.


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


“SKTI”
shall mean SK Telecom International, Inc.


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


“VOIP”
shall mean voice over Internet protocol.


 


“VoWiFi”
shall mean voice over WiFi.


 


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


 


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


 


ARTICLE
2

REPRESENTATIONS AND WARRANTIES


 


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


 


2.1.         Corporate Authority.
It has all requisite corporate or limited liability company power and authority
and has taken all corporate or limited liability company action necessary in
order to execute and deliver this Stockholders’ Agreement and to perform fully
its obligations hereunder.


 


2.2.         Encumbrances.
Such Stockholder owns that number of issued and outstanding shares of Class A
Common Stock and/or Class B Common Stock as set forth in Schedule 2.2 hereto, free and clear of all
liens and encumbrances, except for this Stockholders’ Agreement and the Operating
Agreement. There are no options, warrants or other rights, agreements,
arrangements or commitments of any character to which such Stockholder is a
party relating to the pledge, disposition or voting of any Shares and there are
no voting trusts or voting agreements with respect to such Shares.


 


2.3.         Binding Agreement.
This Stockholders’ Agreement has been duly executed and delivered and is a
valid and binding agreement of such Stockholder enforceable against it in


 


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accordance
with its terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating
to or affecting creditor’s rights and to general equity principles.


 


2.4.         Notices, Reports and Filings.
No notices, reports or other filings are required to be made by such
Stockholder with, nor are any consents, registrations, approvals, permits or
authorizations required to be obtained by it or the Management Company from,
any Governmental Entity, in connection with the execution and delivery of this
Stockholders’ Agreement, except those that have been made or obtained or that
the failure to make or obtain are not, individually or in the aggregate,
reasonably likely to result in a Material Adverse Effect on the Operating
Company.


 


2.5.         Non-Contravention.
The execution, delivery and performance of this Stockholders’ Agreement by such
Stockholder does not, and the consummation by it of the transactions
contemplated hereby will not, constitute or result in (a) a breach or violation
of, or a default under, its organizational documents, (a) a breach of or
violation of or default under, or the acceleration of any obligations of or the
creation of a lien or encumbrance on its assets (with or without notice, lapse
of time or both) pursuant to any Contracts binding upon it or any law, statute
or regulation or governmental or non-governmental permit or license to which it
is subject or (c) any change in the rights or obligations of any party under any
of such Contracts to which it is a party, except, in the case of clause (b) or
(c) above, for any breach, violation, default, acceleration, creation or change
that individually or in the aggregate, is not reasonably likely to (x) result
in a Material Adverse Effect on the Operating Company.


 


ARTICLE
3

VOTING


 


3.1.         Voting Agreements.
Each Stockholder agrees to vote or cause the voting of, whether in person, by
proxy or written consent, all Shares, directly or indirectly, Beneficially
Owned by it so as to cause the events set forth in this Section 3.1 to occur:


 


3.1.1       Election of Class B Directors.
The election of Class B Directors as provided for in Article 6 of the
Certificate of Incorporation.


 


3.1.2       Removal of Class B Directors.
The removal of any Class B Director, upon the request of the Stockholder
entitled to elect such Class B Director.


 


3.1.3       Replacement of Class B Directors.
The appointment of a new Class B Director, to fill any vacancy in the Class B
Directors on the Board of Directors or any committee of the Board of Directors,
as determined by the Stockholder entitled to elect such Class B Director whose
departure has caused the vacancy.


 


3.1.4       Election of Independent Directors.
Following an initial Public Offering, the election of such independent Class A
Directors as are required by Article 6 of the Certificate of Incorporation.


 


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3.1.5       Payment of Dividends.
To the extent that the Management Company receives distributions as a member of
the Operating Company and to the extent permitted by applicable law, the
payment of a dividend in the amount of the net distributions received from the
Operating Company to the holders of shares of Common Stock, subject to (i) any
preferential rights of holders of Preferred Stock, and (ii) any restrictions or
limitations under any credit facility or other loan document in respect of
borrowed money.


 


3.1.6       Conversion and Exchange.
All matters necessary to facilitate the conversion of a Stockholder’s Class B
Common Stock, convertible Preferred Stock and exchange of Membership Units for
shares of Class A Common Stock, each as provided for in the Certificate of
Incorporation.


 


3.1.7       Public Offering.
All matters necessary to facilitate the registration, issuance and sale of
shares of Class A Common Stock in a Public Offering, as provided for in the
Certificate of Incorporation, Operating Agreement and Registration Rights
Agreement, and to give effect to the contribution, to the Operating Company, of
the net proceeds received from such Public Offering of Class A Common Stock.


 


3.1.8       Solicitation of an M&A Transaction.
All matters necessary to facilitate the solicitation or exploration of an
M&A Transaction, including, without limitation, the engagement or retention
of accountants, investment banks, attorneys and similar professionals in
connection therewith (the fees for which shall be paid by the Operating
Company).


 


3.2.         Voting of Irrevocable Proxies.
Each of SKT and EarthLink have been granted irrevocable proxies from certain
stockholders of the Management Company to vote 50% of such stockholders’ Shares
(collectively, the “Proxy Shares”).
Notwithstanding the terms of the irrevocable proxies, SKT and EarthLink agree
to vote or cause the voting of, whether in person, by proxy or written consent,
the Proxy Shares in accordance with the Percentage Ownership of each Class B
Stockholder that is not a Triggering Party (as defined in the Certificate of
Incorporation).


 


ARTICLE
4

ADDITIONAL AGREEMENTS


 


4.1.         Standstill.
The Stockholders and their Subsidiaries shall not take any of the following
actions without the prior written consent of the other Stockholder or the Board
of Directors, as appropriate:


 


(a)                                  acquire
or seek to acquire Beneficial Ownership of any securities, including rights or
options, of the other Stockholder or the Operating Company, except as permitted
by the Operating Agreement;


 


(b)                                 propose
to enter into any merger, purchase of substantially all the assets or any other
business combination involving the other Stockholder;


 


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(c)                                  participate
in any solicitation of proxies to vote, or seek to advise any Person with
respect to the voting of, any securities of the other Stockholder; propose any
stockholder proposals for submission to a vote of stockholders of the other
Stockholder, or propose any Person for election to, or the removal of any
member from, the Board of Directors of the other Stockholder; or in any way
seek to influence the management or policies of the other Stockholder; or


 


(d)                                 enter
into any discussions or understandings with any Third Party, which, if
concluded by any action, would result in a violation of the foregoing.


 


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


 


4.2.         Composition of the Board.
If necessary, the composition of the Board of Directors shall be adjusted, to
the extent necessary, to ensure the ongoing compliance with the Sarbanes-Oxley
Act and the rules and regulations of any stock exchange on which the Management
Company’s Class A Common Stock may be traded. The Stockholders agree to vote
their stock in favor of any such adjustments to the composition of the Board of
Directors.


 


4.3.         [Reserved].


 


4.4.         Insurance.
The Management Company shall purchase and maintain insurance coverage adequate
to cover risks of such types and in such amounts as are customary for companies
of similar size engaged in similar lines of business, including, without
limitation, liability insurance for the benefit of its employees, directors and
officers with respect to claims against such employees, directors and officers
in their capacity as employees, directors and officers in such amounts as the
Management Company shall determine are adequate.


 


ARTICLE
5

TRANSFER RESTRICTIONS


 


5.1.         Transfer Restrictions.
Until such time as a Triggering Event (as defined in Article 5 of the Certificate
of Incorporation) shall occur, each Stockholder agrees that it and its
Subsidiaries and Parent Entities shall not Transfer or permit any Transfer, in
any single transaction or series of related transactions, any JV Securities
that are, directly or indirectly, Beneficially Owned by it, except in
accordance with the terms of this Stockholders’ Agreement and the Operating
Agreement. Any Transfer of any JV Securities other than in accordance with this
Stockholders’ Agreement and the Operating Agreement shall be null and void.


 


5.1.1       Lock-In Period.
Prior to March 24, 2008 (the “Lock-in Period”),
the Stockholders and their Subsidiaries and Parent Entities shall not Transfer
or solicit any Transfer of any JV Securities without the prior written consent
of the non-transferring Class B Stockholder, which cannot be unreasonably
withheld or delayed. After the expiration of the


 


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Lock-in
Period, the Stockholders and their Subsidiaries may, subject to the restrictions
on Transfer contained in this Article 5
or in the Operating Agreement, Transfer all or any portion of their JV
Securities to a Third Party without the necessity of obtaining the prior
written consent of the Class B Stockholder(s).


 


5.1.2       Permitted Transfers.
Notwithstanding anything in Section 5.1.1
to the contrary, the following Transfers of JV Securities will be permitted
(the “Permitted Transfers”)
without the necessity of obtaining the written consent of the Class B
Stockholders:


 


(a)                                  a
Transfer to a Parent Entity (to which the Stockholder is a wholly-owned
Subsidiary) or a wholly-owned Subsidiary of the Stockholder;


 


(b)                                 a
Transfer in connection with an underwritten Public Offering as a selling
Stockholder;


 


(c)                                  a
Transfer to the Operating Company or the Management Company; and


 


(d)                                 a
pledge to a financial institution in connection with a borrowing secured by, a
Stockholder’s JV Securities together with substantially all of that Stockholder’s
other assets.


 


5.1.3       Agreement to be Bound.
In all circumstances other than those described in Section 5.1.2(b), a Transfer of JV Securities or conversion of
Membership Units or shares of convertible Preferred Stock into shares of Class
A Common Stock shall be given effect by the Management Company or the Operating
Company only upon receipt of the written agreement of the recipient of the
transferred JV Securities agreeing to be bound by the terms and conditions of
this Stockholders’ Agreement or the Operating Agreement, as the case may be,
and the Confidentiality Agreement.


 


5.1.4       Effect of Transfer.
Upon any Transfer of all of a Stockholder’s JV Securities, the transferring
Stockholder will have no continuing rights or obligations under this
Stockholder’s Agreement or the Operating Agreement but shall continue to be
bound by any Ancillary Agreements to which it is a party, in accordance with
their terms.


 


5.2.         [Reserved]


 


5.3.         Right of First Refusal.
Subject to Section 5.5, if a
Stockholder (the “First Party”)
receives a bona-fide written offer by a Third Party to purchase all or a
portion of the First Party’s Shares (the “Subject
Interest”) that the First Party desires to accept, the First Party
shall promptly after receipt of the offer deliver notice (the “Transfer Notice”) to the Management
Company and SKT stating that the First Party proposes to Transfer the Subject
Interest. The Transfer Notice shall (i) specify the purchase price and other
material terms of the Transfer of the Subject Interest, (ii) identify the
proposed purchaser, (iii) specify the date scheduled for the Transfer (which
date shall not be less than ninety (90) days after the date the Transfer Notice
is delivered) and (iv) have attached thereto a copy of the bona fide offer and
any ancillary agreements containing terms and conditions of the sale of the
Subject Interest. Within


 


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sixty (60)
days after receipt of a Transfer Notice, SKT will have the right to elect to
purchase a portion of the Subject Interest being sold equal to their respective
ROFR Percentage Interests (a “Right of First
Refusal”), on terms and conditions no less favorable to the First
Party than those set forth in the Transfer Notice; provided, that
if such terms and conditions include non-cash assets or nonfinancial requirements
that would be impracticable to satisfy, then SKT shall not be required to
satisfy such terms, conditions and requirements, and the purchase price for the
Subject Interest will include an amount equal to the fair market value of such
non-cash assets. If SKT elects to purchase the Subject Interest, the First
Party and SKT shall use reasonable efforts to consummate the closing of the
purchase of the Subject Interest as soon as reasonably practicable and in any
event within one hundred twenty (120) calendar days after receipt of the
Transfer Notice (the “ROFR Termination Date”),
provided, that if the closing does not occur by then due to the
failure to receive any required regulatory approvals or consents, the ROFR
Termination Date may be extended by either the First Party or SKT until such
approvals are received, but in no event for a period of more than one hundred
eighty (180) calendar days after receipt of the Transfer Notice. If the Right
of First Refusal is not exercised by SKT as to the entire Subject Interest
within sixty (60) days of receipt of the Transfer Notice or the entire Subject
Interest is not purchased from the First Party prior to the ROFR Termination
Date, as adjusted for any extension thereto, then the First Party may sell the
Subject Interest to the proposed purchaser identified in the Transfer Notice on
the terms set forth therein, subject to the Tag-along Right of SKT provided in Section 5.4 below. If SKT agrees to
purchase any portion of the Subject Interest in accordance with the foregoing
and fails to complete the purchase of such portion of the Subject Interest
prior to the ROFR Termination Date, other than as a result of a denial of any
required regulatory approvals or consents, then SKT shall be deemed to have
breached this Stockholders’ Agreement and, in addition to any other right or
remedy available to the First Party or the Management Company, shall be deemed
to have forfeited its Tag-along Right under Section
5.4 in connection with the First Party’s right to sell the Subject
Interest to the Third Party named in the Transfer Notice. The above Right of
First Refusal shall not apply to a transaction which constitutes a Change of
Control of a Class B Stockholder.


 


5.4.         Tag-along Right.
If (i) the Right of First Refusal is not exercised by SKT as to the entire
Subject Interest within sixty (60) days of receipt of the Transfer Notice or
the entire Subject Interest is not purchased from the First Party on or before
the ROFR Termination Date, as it may have been extended or (ii) SKT receives a
bona-fide written offer by a Third Party to purchase SKT’s Subject Interest
that SKT desires to accept, then the First Party or SKT, as applicable, shall
promptly deliver written notice thereof (“Tag-along
Transfer Notice”) to any non-transferring Class B Stockholder (each
non-transferring Class B Stockholder a “Second
Party” and collectively, the “Second
Parties”) and each Second Party will have the right to sell to the
Third-Party purchaser identified in the Tag-along Transfer Notice a portion of
the Subject Interest, from such Second Party’s Shares, equal to the Subject
Interest multiplied by such Second Party’s Percentage Interest (“Tag-along Right”); provided that no Second
Party that has breached its obligations under Section
5.3 with respect to any Subject Interest may exercise any Tag-along
Right with respect to such Subject Interest. A Second Party electing to
exercise its Tag-along Right shall provide to the Operating Company and the
First Party written notice of such election (the “Tag-along Election Notice”) within such sixty (60) day period.
The Tag-along Election Notice shall specify the number of Shares to be included
in the sale to the Third-Party purchaser. Any sale pursuant to this Section 5.4 shall be consummated not later
than sixty (60) days following delivery of the Tag-along Election Notice.


 


13

















 


5.5.         Limitation on the Right of First
Refusal and Tag-along Right. The Right of First
Refusal and Tag-along Right described in Sections
5.3 and 5.4, above,
shall not apply to Permitted Transfers. The Right of First Refusal and the
Tag-along Right shall terminate upon a Public Offering of the Class A Common
Stock and the availability of Rule 144 to Stockholders for the Transfer of
their Shares.


 


5.6.         Drag-along Right.
Notwithstanding anything herein to the contrary, in the event of a bona fide
arm’s length sale (including a binding commitment to sell) to an unaffiliated
Third Party by SKT, in a single transaction or a series of related transactions
(whether by sale of shares, merger, amalgamation, consolidation, sale of assets
or similar transaction), of not less than a majority of the Total Outstanding
Shares then owned by SKT (a “Recommended
Transaction”), each of the other Stockholders (collectively, the “Subject Stockholders”) will be obliged to
sell if required by SKT, in the same transaction or transactions, the same
proportion of the Total Outstanding Shares held by such Subject Stockholder as
being sold by SKT, and each Subject Stockholder further agrees (if it is
required to participate in the sale) to vote, or grant proxies to vote, the
proportion of such Subject Stockholder’s Total Outstanding Shares subject to
the Recommended Transaction in favor of the Recommended Transaction and to take
such other votes or actions as may be reasonably necessary to facilitate the
Recommended Transaction. The obligations of the Subject Stockholders pursuant
to this Section 5.6 are subject to
the satisfaction of the following conditions:


 


5.6.1       Upon the consummation
of the Recommended Transaction, all of the Subject Stockholders shall receive
the same proportion of the aggregate consideration from such Recommended
Transaction that such holder would have received if such aggregate
consideration had been distributed by the Management Company in complete
liquidation pursuant to the rights and preferences set forth in the Certificate
of Incorporation as in effect immediately prior to such Recommended Transaction.
SKT unconditionally agrees that no consideration in connection with the
Recommended Transaction will be diverted away from the Subject Stockholders
through value-added partnership or commercial agreements entered into in
connection with such Recommended Transaction.


 


5.6.2       If any Subject
Stockholders of a class or series is given an option as to the form and amount
of consideration to be received, all holders of such class or series will be
given the same option.


 


5.6.3       No Subject
Stockholders shall be obligated to make any out-of-pocket expenditure prior to
the consummation of the Recommended Transaction and no Subject Stockholders
shall be obligated to pay more than its pro rata share (based upon the amount
of consideration received) of reasonable expenses incurred in connection with a
consummated Recommended Transaction to the extent such costs are incurred for
the benefit of SKT and all Subject Stockholders and are not otherwise paid by
the Management Company or the acquiring party (costs incurred by SKT or on
behalf of a Subject Stockholder for its sole benefit will not be considered
costs of the transaction hereunder); provided that SKT and a Subject
Stockholder’s liability for such expenses shall be shared pro rata based on SKT
and each Subject Stockholder’s share of the share capital of the Management
Company.


 


14

















 


5.6.4       In the event
that SKT and all the Subject Stockholders are required to provide any
representations or indemnities in connection with the Recommended Transaction
(other than representations and indemnities concerning (i) each Subject
Stockholder’s valid ownership of its Shares in the Management Company, free of
all liens and encumbrances (other than those arising under applicable
securities laws), and (ii) each Subject Stockholder’s authority, power, and
right to enter into and consummate such purchase or merger (amalgamation)
agreement without violating any other agreement), then each Subject Stockholder
shall not be liable for more than its pro rata share (based upon the amount of
consideration actually received) of any liability for misrepresentation or
indemnity and such liability shall not exceed the total purchase price received
by such Subject Stockholder for its Shares.


 


5.6.5       No Subject
Stockholder shall be obligated to enter into any non-competition or other
restrictive covenant in connection with the Recommended Transaction unless (i)
such restrictive covenant only prohibits the Subject Stockholder from providing
MVNO Services (as defined in Section 6.7.2)
in the United States for a period of two (2) years, and (ii) SKT and each
other Subject Stockholder agree to such restrictive covenant in connection with
the Recommended Transaction.


 


5.6.6       The provisions
of this Section 5.6 shall
terminate on the consummation of a Public Offering.


 


5.7.         Transfer of Class B Common Stock.
Except as provided below, if a Class B Stockholder desires to Transfer its
shares of Class B Common Stock other than to an Affiliate, then it must, first,
convert its shares of Class B Common Stock into shares of Class A Common Stock,
and second, Transfer the shares of Class A Common Stock pursuant to a Permitted
Transfer. Notwithstanding the foregoing restriction, a holder of Class B Common
Stock may sell its shares of Class B Common Stock in a transaction in which it
completely divests itself of all interests in the Management Company and the
Operating Company, subject at all times to the Transfer restrictions set forth
in this Stockholders’ Agreement and the Operating Agreement.


 


ARTICLE
6

RESTRICTED SERVICES


 


6.1.         Restricted Services.
For the periods specified below, the Management Company shall cause the
Operating Company and its Subsidiaries to refrain from providing the services
set forth in this Section 6.1 (the
“Restricted Services”), except as
provided in Section 6.1.3 or
pursuant to a written agreement with the party benefiting from such
restrictions.


 


6.1.1       EarthLink Services.
For so long as EarthLink or a Subsidiary of EarthLink owns a share of Class B
Common Stock, the Management Company shall cause the Operating Company and its
Subsidiaries to refrain from providing the following Restricted Services that
the parties deem to compete with and overlap the products and services provided
by EarthLink and its Affiliates: (a) Broadband internet access, including cable,
DSL, PC-based satellite and fixed wireless; (b) Dial-up internet access; (c)
Web hosting services; (d) VOIP or VoWiFi services over broadband; (e) PC-based
wireless Wide Area Network or Local Area


 


15

















 


Network
internet access services (e.g. home networking) and (f) Internet portal service
for Third Parties that are not customers of the Operating Company or a
Subsidiary thereof, except as needed for customer acquisition services and
maintenance purposes.


 


6.1.2       SKT Services.
For so long as SKT or a Subsidiary of SKT owns a share of Class B Common Stock,
the Management Company shall cause the Operating Company and its Subsidiaries
to refrain from providing the following Restricted Services that the parties
deem to compete with and overlap the products and services provided by SKT and
its Affiliates:  (a) mobile virtual
network enabler, wireless application service provider and managed services for
wireless telecom service providers and (b) development and manufacture of
wireless devices with the intent to sell such devices to wireless telecom
service providers, provided, that the Operating Company and its
Subsidiaries are permitted to purchase and distribute such devices that are
manufactured by Third-Party manufacturers.


 


6.1.3       Sales to Commercial Partners.
Notwithstanding the above restrictions, the Operating Company and its
Subsidiaries may offer the Operating Company Products and Services to
commercial partners who bundle and sell the Operating Company Products and
Services with products and services which constitute or are similar to the
Restricted Services.


 


6.2.         Products and Services Outside the
Business Plan. The Management Company shall cause
the Operating Company and its Subsidiaries to refrain from engaging in the
development of new products and services that are outside of the approved
Business Plan.


 


6.3.         Wimax Enabled Devices.
The Operating Company and its Subsidiaries may distribute handset devices that
contain the hardware and software components necessary to permit Wimax access (“Wimax Enabled Devices”) and related
hand-set only Wimax services, but, for so long as EarthLink or a Subsidiary of
EarthLink owns a share of Class B Common Stock, may not sell PC-based Wimax
services other than those of EarthLink. The Operating Company and its
Subsidiaries may distribute Wimax Enabled Devices to Third Parties who bundle
and resell the Wimax Enabled Devices with the Wimax handset only access
services of such Third Party. The Operating Company may only offer EarthLink’s
PC-based Wimax devices and services, which EarthLink shall make available to
the Operating Company on prices, terms and conditions that are at least as
favorable, from a financial perspective, to the Operating Company as the
prices, terms and conditions of substantially similar products and services
provided by EarthLink to a Third Party not affiliated with EarthLink.
Distribution of any other Wimax convergent devices, between PC and handset
devices, must be approved by (i) a majority of Class B Directors, and (ii) a
majority vote of all directors.


 


6.4.         [Reserved.]


 


6.5.         ASP. For
so long as EarthLink or a Subsidiary of EarthLink owns a share of Class B
Common Stock, each Stockholder and each Subsidiary of a Stockholder that acts
as an ASP in the United States (each, a “Provider”)
shall, if requested by the Operating Company, provide ASP solutions,
applications and platforms, including a license or professional service with
respect thereto, but excluding Coloring Service, to the Operating Company on
terms no less favorable than those offered by the Provider to third party
purchasers in the United States for substantially similar volumes of
substantially similar products and services.


 


16






 












 


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


 


6.7.         Exclusivity.


 


6.7.1       From the date
hereof until the earlier of (a) the date of the SKT Triggering Contribution or
(b) two (2) years from the first date on which either Class B Stockholder’s
ownership of the Total Outstanding Shares falls below ten percent (10%),
EarthLink and SKT and their Subsidiaries shall not provide mobile wireless
voice or data services over handsets in the United States; provided, however,
in the event of a Contribution Breach, SKT shall not provide mobile wireless
voice or data services over handsets in the United States from the date of the
Contribution Breach until two (2) years from the first date on which either
Class B Stockholder’s ownership of the Total Outstanding Shares falls below ten
percent (10%). In the event that SKT provides mobile wireless voice or data
services over handsets in the United States in the period between the date of
the SKT Triggering Contribution and a Contribution Breach, upon a Contribution
Breach (i) SKT must immediately cease providing all such services (other than
through the Management Company or the Operating Company), (ii) any agreements
entered into by SKT (other than through the Management Company or the Operating
Company) related to providing such services will be void as of the date of the
Contribution Breach and (iii) any entity (which shall not include the
Management Company or the Operating Company) created by SKT to provide such
services must be dissolved. It is understood and agreed that money damages
would not fully compensate EarthLink as a remedy for a Contribution Breach by
SKT and, without prejudice to any other rights and remedies otherwise available
to EarthLink, EarthLink shall be entitled to equitable relief by way of
injunction, specific performance or otherwise with respect to this Section 6.7 in the event of a Contribution
Breach.


 


6.7.2       Other than
through the Operating Company, EarthLink and SKT and their Subsidiaries shall
not provide MVNO Services in the United States. The restrictions set forth in
this Section 6.7.2 shall terminate
on the date that is two (2) years from the first date on which either Class B
Stockholder’s ownership of the Total Outstanding Shares falls below ten percent
(10%). For purposes of this Section 6.7.2,
“MVNO Services” means providing mobile voice and data services on mobile
handsets without owning any material part of a mobile network or frequency
pertaining to such said mobile services, but instead by leasing all or
substantially all of the mobile network and frequency from mobile network
operators.


 


6.7.3       Neither
EarthLink nor SKT nor their respective Subsidiaries shall assist any Parent
Entity or any Subsidiary of a Parent Entity in any activity that would
constitute a violation of the exclusivity provisions set forth in this Section 6.7 if it were performed by such
party or its Subsidiary directly. Except as provided in this Agreement, nothing
shall prohibit EarthLink and SKT or their respective Subsidiaries from
competing with each other or the Operating Company, its Parent Entity or any of
its Subsidiaries.


 


17

















 


6.8.         [Reserved].


 


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


 


ARTICLE
7

CONVERSION AND EXCHANGE


 


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


 


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


 


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


 


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


 


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


 


18

















 


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


 


ARTICLE
8

STRATEGIC DECISIONS AND DEADLOCK MATTERS


 


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


 


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


 


ARTICLE
9

CERTIFICATES


 


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


 


19

















 


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


 


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


 


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


 


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


 


20

















 


ARTICLE
10

TERMINATION


 


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


 


10.1.1     Written Consent.
The written consent of the Stockholders.


 


10.1.2     Unlawful to Continue.
The occurrence of any event which makes it unlawful for the Management Company
to be continued.


 


10.1.3     Order of Dissolution.
The issuance of a decree by any court of competent jurisdiction that the
Management Company be dissolved and liquidated.


 


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


 


ARTICLE
11

DISPUTE RESOLUTION


 


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


 


11.1.1     Negotiation Between Executives.
The Stockholders shall attempt in good faith to resolve any dispute arising out
of or relating to this Stockholders’ Agreement promptly by direct negotiation
between executives who have authority to settle the controversy and who are at
a higher level of management than the persons with direct responsibility for
administration of this Agreement, unless there is no executive of a higher
level. Any party may give the other party written notice of any dispute not
resolved in the normal course of business. Within fifteen (15) days after delivery
of the notice, the receiving party shall submit to the other a written response.
The notice and the response shall include: (a) a statement of each party’s
position and a summary of arguments supporting that position; and (b) the name
and title of the executive who will represent that party and of any other
person who will accompany the executive. Within thirty (30) days after delivery
of the disputing party’s notice, the executives of each Stockholder shall meet
at a mutually acceptable time and place, and thereafter as often as they
reasonably deem necessary, to attempt to resolve the dispute. All reasonable
requests for information made by one party to the other will be honored. All
negotiations pursuant to this clause are, confidential and shall be treated as
compromise and settlement negotiations for purposes of applicable rules of
evidence.


 


11.1.2     Mediation With Mutually Agreed-Upon
Neutral. If the dispute has not been resolved by
negotiation within forty-five (45) days of the disputing party’s notice, or if
the Stockholders fail to meet within twenty (20) days the Stockholders shall
submit the dispute to non-binding mediation under the then-current CPR
Institute for Dispute Resolution’s (“CPR”)



 


21

















 


Model
Mediation Procedure for Business Disputes, and endeavor (but not be obligated)
to settle the dispute in such mediation. CPR’s address at the time of this
Agreement is 366 Madison Avenue, 14th Floor, New York, New York 10017
(212-949-6490) and its website is “www.cpradr.org.”  The Stockholders agree to use their
reasonable best efforts and good faith to agree mutually on a mediator, to be
selected from the CPR Technology Panel of Neutrals. If the Stockholders fail to
select a mutually acceptable mediator within thirty (30) days after either
party’s notice to the other party that they request non-binding mediation
pursuant to this subsection, CPR will appoint a mediator from the Technology
Panel.


 


11.1.3     Arbitration.
All disputes arising out of or relating to this Stockholders’ Agreement not
resolved pursuant to non-binding mediation within thirty (30) days or as this
time period may be extended by written agreement of the Stockholders shall be
settled finally in an arbitration conducted under the Rules of Arbitration of
the International Chamber of Commerce (“ICC”)
and as provided in this Section 11.1.3.


 


(a)                                  The
arbitration proceedings shall be conducted in New York, New York, U.S.A.


 


(b)                                 The
arbitration proceedings shall be governed by the laws of New York.


 


(c)                                  The
language of the arbitration proceedings shall be English.


 


(d)                                 The
arbitral tribunal shall consist of three (3) arbitrators, one (1) of which
shall be selected by SKT and one (1) of which shall be selected by EarthLink. The
third arbitrator shall be selected by the two (2) arbitrators appointed by SKT
and EarthLink.


 


(e)                                  The
International Bar Association’s Rules on the Taking of Evidence in
International Commercial Arbitration shall apply together with the ICC Rules
governing any submission to arbitration incorporated in this Agreement.


 


(f)                                    Every
award shall be binding on the Stockholders. By submitting the dispute to
arbitration under the ICC Rules, the Stockholders undertake to carry out any
award without delay and shall be deemed to have waived their right to any form
of recourse insofar as such waiver can validly be made.


 


(g)                                 This
agreement to arbitrate shall be binding on the Stockholders and their
respective successors, assigns and Affiliates.


 


(h)                                 The
prevailing party in any arbitration proceeding conducted pursuant to this
Stockholders’ Agreement may recover its reasonable fees both for legal
representation and related costs in any action to enforce this Agreement in any
judicial or arbitration proceeding.


 


22

















 


(i)                                     The
Stockholders waive any right or claim to punitive or exemplary damages and
agree that punitive or exemplary damages are not within the
contemplation of this Stockholders’ Agreement. No arbitral tribunal may order
an award consisting in whole or in part of punitive or exemplary damages.


 


11.1.4     Tolling of Statutes of Limitation.
All applicable statutes of limitation and defenses based on the passage of time
shall be tolled while the procedures specified in Section 11.1.2 and Section
11.1.3 are pending. The Stockholders will take such action, if any,
required to effectuate such tolling.


 


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


 


ARTICLE
12

MISCELLANEOUS


 


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


 


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


 


If to SKT:


 


SK Telecom Co., Ltd.


11, Euljiro2-ga, Jung-gu


Seoul 100-999, Korea


Attention:  Mr. Seung – Kook Synn


Facsimile:  (822) 6100-7966


 


23

















 


with a copy to:


 


Baker & McKenzie

14th Floor, Hutchison House, 10 Harcourt

Hong Kong, SAR

Attention: Mr. Won Lee

Facsimile:  (852) 2845 0476


 


If to EarthLink:


 


EarthLink, Inc.


1375 Peachtree Street, N.E.


Atlanta, Georgia 30309


Attention:  Chief Executive
Officer


Facsimile:  (404) 892-7616


Copy to:  Samuel R. DeSimone,
General Counsel


 


with a copy to:


 


Troutman Sanders LLP


600 Peachtree Street N.E., Suite 5200


Atlanta, Georgia 30308


Attention:  David M. Carter


Facsimile:  (404) 962-6598


 


If to the Management Company:


 


HELIO, Inc.


10960 Wilshire Blvd., Suite 700


Los Angeles, California 90024


Attention:  Legal Department


Facsimile:  (310) 312-8889


 


with a copy to:


 


HELIO LLC


10960 Wilshire Blvd., Suite 700


Los Angeles, California 90024


Attention:  Sky D. Dayton, Chief
Executive Officer


Facsimile:  (310) 996-1368


 


with a copy to:


 


Kirkpatrick & Lockhart Preston Gates Ellis LLP


10100 Santa Monica Boulevard, Seventh Floor


 


24

















 


Los Angeles, California 90067


Attention:  Thomas J. Poletti


Facsimile:  (310) 552-5001


 


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


 


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


 


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


 


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


 


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


 


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


 


25

















 


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


 


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


 


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


 


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


 


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


 


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


 


	
   

  	
  SK TELECOM CO., LTD.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Jin Woo So, Senior Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EARTHLINK, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HELIO, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Sky D. Dayton, Chief Executive Officer

  



 


 


[Signature Page to Stockholders’ Agreement]


 

















 


Schedule 8.1(a)


 


Strategic Decisions


 


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


 


(a)                                  Any
amendment to governing documents, to the extent (i) with respect to an
amendment of the Certificate of Incorporation, such amendment alters or changes
the powers, preferences or special rights of the Class A Common Stock or Class
B Common Stock, (ii) with respect to an amendment to the Operating Agreement,
such amendment alters or changes the powers, preferences or special rights of
the Preferred Membership Units, (iii) with respect to the amendment of the
Bylaws of the Management Company and this Stockholders’ Agreement, such
amendment alters or changes the powers, preferences or special rights of the
Class A Common Stock or the Class B Common Stock;


 


(b)                                 Transactions
with Affiliates in excess of $5,000,000, provided that (i) the Operating
Company notifies both EarthLink and SKT with respect to any such transactions
and (ii) to the extent the aggregate of any such transactions by and between
SKT, and/or its affiliated parties, on one hand, and the Operating Company, on
the other hand, exceeds $10,000,000 on a cumulative annual basis (excluding
from such calculation any transactions that are approved by all Class B
Directors and a majority vote of all directors), then any further transactions
with Affiliates during such year shall be deemed Strategic Decisions and be
subject to approval herein;


 


(c)                                  Any
modifications of Schedules 8.1(a) or
(b);


 


(d)                                 Any
issuance of equity or membership interest senior to the Class B Common Stock or
the Membership Units, including any preferred stock or Preferred Membership
Units;


 


(e)                                  Any
Bankruptcy Matter; and


 


(f)                                    Except
in connection with an M&A Transaction, any event which results in the
primary investment vehicle of the joint venture (represented by the Operating
Company and the Management Company) becoming a corporation as opposed to a
limited liability company, whether such occurs by means of a conversion of the
Operating Company from a limited liability company to a 


 

















 


corporation, a merger of the Operating
Company into the Management Company or otherwise.


 

















 


Schedule 8.1(b)


 


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


 


(a)                                  Indebtedness
(for money borrowed and lease obligations) in excess of $5 million, outside of
ordinary course trade debt;


 


(b)                                 Declaration
and payment of dividends or distributions;


 


(c)                                  Distribution
of any other Wimax convergent devices, between PC and handset devices;


 


(d)                                 Any
M&A Transaction;


 


(e)                                  Approval
of annual Business Plan and Operating Budget;


 


(f)                                    Change
in scope of business;


 


(g)                                 Hiring/firing
(and terms of employment) of Executive Officers;


 


(h)                                 Delegation
and creation of any committees of the Board;


 


(i)                                     Acquisition
or disposition of assets (including, without limitation, subsidiaries, equity,
debt and other investments, etc.) in excess of $5 million;


 


(j)                                     New
technology purchases/investments in excess of $5 million;


 


(k)                                  Entering
into any material agreement in excess of $5 million;


 


(l)                                     Additional
capital contributions;


 


(m)                               Selection
of independent auditors for financial purposes;


 


(n)                                 Creation
and management of significant corporate governance and financial policies;


 


(o)                                 Location
of cash and investment holdings;


 


(p)                                 Change
in the name of the Management Company or the Operating Company or significant
branding;


 


(q)                                 Selection
and/or relocation of headquarters;


 


(r)                                    Establishment/change
in regulatory or public policy positions;


 

















 


(s)                                  New
products or services outside of the Business Plan;


 


(t)                                    Adoption
or change to any material employee policies including the adoption of an equity
compensation plan;


 


(u)                                 Non-competition
or non-solicitation agreements binding the Operating Company;


 


(v)                                 Merger,
consolidation or reorganization that is not an M&A Transaction or
Bankruptcy Matter; and


 


(w)                               The
support, public or in confidence, of any law, rule or regulation that may
likely have a significant impact on the primary business of either EarthLink or
SKT.


 


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