Exhibit 10.1


 


EARTHLINK, INC.


                    PLAN


Incentive
Stock Option Agreement


No. of shares subject to

Incentive Stock Option:


THIS INCENTIVE STOCK
OPTION AGREEMENT (this “Agreement”) dated as of the      
day of                ,
20     , by and between EarthLink, Inc., a Delaware
corporation (the “Company”), and                     
(“Participant”) is made pursuant and subject to the provisions of the                     
Plan (the “Plan”), a copy of which is attached hereto.  All terms used herein that are defined in the
Plan have the same meaning given them in the Plan.


1.                                   Grant of Incentive Stock Option. 
Pursuant to the Plan, the Company, on                ,
20      (the “Date of Grant”), granted to Participant,
subject to the terms and conditions of the Plan and subject further to the
terms and conditions herein set forth, the right and option to purchase from
the Company all or any part of an aggregate of           
shares of Common Stock at the option price of $          
per share, such option price per share being not less than the Fair Market
Value of a share of the Common Stock on the Date of Grant (or, in case of a Ten
Percent Shareholder as described in the Plan, not less than 110 percent of the
Fair Market Value of a share of the Common Stock on the Date of Grant). This
Option is to be treated as an Incentive Stock Option; except, however, if the
aggregate Fair Market Value, determined at the time of grant, of shares of
Common Stock with respect to which Participant may exercise Incentive Stock
Options for the first time during any calendar year under the Plan and any
other plan of the Company exceeds $100,000, the Incentive Stock Options that
cause the limitation to be exceeded shall be treated as Nonqualified Stock
Options. . This Incentive Stock Option is exercisable as hereinafter provided.


 


2.                                       Terms and Conditions. 
This Incentive Stock Option is subject to the following terms and
conditions:


(a)                                  Expiration Date. 
This Incentive Stock Option shall expire at 11:59 p.m. on                ,
20      (the “Expiration Date”).  In no event shall the Expiration Date be
later than 10 years from the Date of Grant (or, in case of a Ten Percent
Shareholder as described in the Plan, five years from the Date of Grant).


(b)                                 Exercise of Option. 
Except as provided in the Plan and in paragraphs 3, 4, 5, 6 or 7, this
Incentive Stock Option shall be exercisable with respect to Twenty-Five Percent
(25%) of the shares of Common Stock subject to the Option on the first annual
anniversary of the Date of Grant and then with respect to another Six and One
Quarter Percent (6.25%) of the Shares of Common Stock subject to this Option on
each quarterly (three-month) anniversary thereafter until this Option has
become exercisable with respect to One Hundred Percent (100%) of the shares of
Common Stock subject to this Option, provided Participant is still employed by


 





















 


the Company or any Subsidiary at each such time.  Once this Incentive Stock Option has become
exercisable in accordance with the preceding sentence, it shall continue to be
exercisable until the earlier of the termination of the Participant’s rights
hereunder pursuant to paragraphs 3, 4, 5, 6 or 7 or until the Expiration
Date.  A partial exercise of this
Incentive Stock Option shall not affect Participant’s right to exercise this
Incentive Stock Option with respect to the remaining shares, subject to the
conditions of the Plan and this Agreement.


(c)                                  Method of Exercise and Payment for Shares. 
This Incentive Stock Option shall be exercised by delivering written
notice to the attention of the Company’s Secretary or his designee at the
Company’s principal office located at 1375 Peachtree Street, Level A, Atlanta,
GA 30309.  The exercise date shall be (i)
in the case of notice by mail, the date of postmark, or (ii) if delivered in
person, the date of delivery.  Such
notice shall be accompanied by payment of the Option price in full, in cash or
cash equivalent acceptable to the Administrator, or, if the Administrator in
its discretion permits, (i) by the surrender of shares of Common Stock
that Participant has owned for at least six months with an aggregate Fair
Market Value (determined as of the preceding business day) which, together with
any cash or cash equivalent Participant pays, is not less than the Option price
of the number of shares of Common Stock for which the Incentive Stock Option is
being exercised, (ii) by a cashless exercise through a broker, (iii) by
such other medium of payment as the Administrator in its discretion shall
authorize or (iv) by any combination of the aforementioned methods of
payment.


(d)                                 Nontransferability. 
This Incentive Stock Option is nontransferable except by will or by the
laws of descent and distribution.  During
Participant’s lifetime, only Participant may exercise this Incentive Stock
Option. No right or interest of Participant in this Incentive Stock Option
shall be liable for, or subject to, any lien, obligation or liability of the
Participant.


(e)                                  Shareholder Rights. 
Participant shall not have any rights as a shareholder with respect to
shares of Common Stock subject to this Incentive Stock Option until the proper
exercise of such Incentive Stock Option, the payment of the Option price and
any applicable withholding taxes, and the issuance to Participant of the certificates
representing the shares of Common Stock for which the Incentive Stock Option is
exercised.


3.                                       Exercise in the Event of Death. 
This Incentive Stock Option shall be exercisable for all or part of the
number of shares of Common Stock that Participant is entitled to purchase
pursuant to paragraph 2(a) and (b) as of the date of Participant’s death,
reduced by the number of shares for which Participant previously exercised the
Incentive Stock Option, in the event Participant dies while employed by the Company
or any Subsidiary and prior to the Expiration Date and prior to the termination
of the Participant’s rights under paragraphs 4, 5, 6 or 7.  In that event, this Incentive Stock Option
may be exercised by Participant’s estate, or the person or persons to whom Participant’s
rights under this Incentive Stock Option shall pass by will or the laws of
descent and distribution.  In that event,
Participant’s estate or such persons may exercise this Incentive Stock Option
during the remainder of the period preceding the Expiration Date or within 180
days of the date Participant dies, whichever is shorter.


4.                                       Exercise in the Event of Disability. 
This Incentive Stock Option shall be exercisable for all or part of the
number of shares of Common Stock that Participant is entitled to 


 


 


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purchase pursuant to paragraph 2(a) and (b) as of the
date Participant becomes Permanently and Totally Disabled (as defined below),
reduced by the number of shares for which Participant previously exercised the
Incentive Stock Option, if Participant becomes permanently and totally disabled
within the meaning of Section 22(e)(3) of the Code (“Permanently and
Totally Disabled”) while employed by the Company or any Subsidiary and prior to
the Expiration Date and prior to the termination of Participant’s rights under
paragraphs 3, 5, 6 or 7.  In that
event, Participant may exercise this Incentive Stock Option during the
remainder of the period preceding the Expiration Date or within 180 days of the
date he ceases to be employed by the Company or any Subsidiary on account of
being Permanently and Totally Disabled, whichever is shorter.  The Administrator, in its sole discretion,
shall determine whether Participant is Permanently and Totally Disabled for
purposes of this paragraph 4.


5.                                       Exercise in the Event of Retirement. 
This Incentive Stock Option shall be exercisable for all or part of the
number of shares of Common Stock that Participant is entitled to purchase
pursuant to paragraph 2(a) and (b) as of the date Participant Retires (as
defined below), reduced by the number of shares for which Participant
previously exercised the Incentive Stock Option, if Participant Retires (as
defined below) while employed by the Company or any Subsidiary and prior to the
Expiration Date and prior to the termination of Participant’s rights under
paragraphs 3, 4, 6 or 7.  In that
event, Participant may exercise this Option during the remainder of the period
preceding the Expiration Date or within 30 days of the date Participant
Retires, whichever is shorter.  For
purposes of this Agreement, Participant Retires whenever Participant terminates
employment with the Company or any Subsidiary on account of retirement under
any tax-qualified retirement plan of the Company in which Participant
participates.


6.                                       Exercise After Termination of Employment. 
This Incentive Stock Option shall be exercisable for all or part of the
number of shares that Participant is entitled to purchase pursuant to paragraph
2(a) and (b) as of the date Participant ceases to be employed by the Company or
any Subsidiary, reduced by the number of shares for which Participant
previously exercised the Incentive Stock Option, if Participant ceases to be
employed by the Company or any Subsidiary other than on account of death or
Disability or because he Retires prior to the Expiration Date and prior to the
termination of Participant’s rights under paragraphs 3, 4, 5 or 7.  In that event, Participant may exercise this
Incentive Stock Option during the remainder of the period preceding the
Expiration Date or until the date that is 30 days after the date Participant
ceases to be employed by the Company or any Subsidiary other than on account of
death or Disability or because Participant Retires, whichever is shorter.


7.                                       Termination of Employment for Cause. 
Notwithstanding any other provision of this Agreement, all rights
hereunder will be immediately discontinued and forfeited, and the Company shall
not have any further obligation hereunder to Participant and the Option will
not be exercisable for any number of shares of Common Stock (even if the Option
previously became exercisable), on and after the time Participant is discharged
from employment with the Company or any Subsidiary for Cause.


8.                                       Investment Representations. 
In connection with the acquisition of this Option, Participant
represents and warrants as follows:


(a)                                  Participant is acquiring this Option and,
upon exercise of the Option, will be acquiring shares of Common Stock for
investment for Participant’s own account,


 


 


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not as a nominee or agent, and not with a view to or
for resale in connection with, any distribution thereof.


(b)                                 Participant has a pre-existing
business or personal relationship with the Company or one of its directors,
officers or controlling persons and by reason of Participant’s business or
financial experience, has, and could be reasonably assumed to have, the
capacity to evaluate the merits and risks of purchasing shares of Common Stock
and to make an informed investment decision with respect thereto and to protect
Participant’s interest in connection with the acquisition of this Option and
shares of Common Stock.


9.                                       Minimum Exercise.  This Incentive Stock Option may not be
exercised for less than       shares of Common Stock
unless it is exercised for the full number of shares that remain subject to the
Incentive Stock Option.


10.                                 Fractional Shares.  Fractional shares shall not be issuable
hereunder, and when any provision hereof may entitle
Participant to a fractional share, such fraction shall be disregarded.


11.                                 Tax Withholding and
Reporting.  Participant is
responsible for satisfying in cash or cash equivalent any income and employment
(including without limitation Social Security and Medicare) tax withholding
obligations attributable to participation in the Plan as a result of the grant
or exercise.  The Company shall comply
with all such reporting and other requirements relating to the administration
of the Plan and the grant, exercise and vesting of this Incentive Stock Option
as applicable law requires.


12.                                 Change in
Capital Structure.  The
terms of this Incentive Stock Option shall be adjusted in accordance with the
terms and conditions of the Plan as the Administrator determines is equitably
required in the event the Company effects one or more stock
dividends, stock split-ups, subdivisions or consolidations of shares or other
similar changes in capitalization.


13.                                 Notification Upon
Sale.  Participant shall give written
notice to the Company’s Secretary at the Company’s principal office located at 1375
Peachtree Street, Level A, Atlanta, GA 30309, if Participant
sells or otherwise disposes of any shares of Common Stock acquired under this
Incentive Stock Option before the expiration of the later of the two-year
period beginning on the Date of Grant or the one-year period beginning on the
date that Participant exercised this Incentive Stock Option with respect to
such shares.


14.                                 No Right
to Continued Employment.  This Incentive Stock Option does not confer
upon Participant any right with respect to continuance of
employment by the Company or any Subsidiary, nor shall it interfere in any way
with the right of the Company or any Subsidiary to terminate Participant’s employment
at any time.


15.                                 Participant Bound
by Plan.  Participant hereby
acknowledges receipt of a copy of the Plan and agrees to be bound by all the terms
and provisions of the Plan as it may be amended from time to time in accordance
with the terms thereof, provided that no such amendment shall deprive
Participant, without Participant’s consent, of this Incentive Stock Option or
any rights thereunder.  Pursuant to the
Plan, the Company’s Board of Directors is authorized to adopt rules and
regulations not inconsistent with the Plan as it shall deem appropriate and
proper.  A copy of this Plan in its
present form is available on the Company’s intranet site at                    .


 


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16.                                 Binding Effect.  Subject to the limitations stated above and
in the Plan, this Agreement shall be binding upon and inure to the benefit of
the legatees, distributees, transferees and personal representatives of
Participant and the successors of the Company.


17.                                 Conflicts.  In the event
of any conflict between the provisions of
the Plan and the provisions of this
Agreement, the provisions of the Plan shall govern.  All references herein to the Plan shall mean
the Plan as in effect on the date hereof.


18.                                 Governing Law. 
This Agreement shall be governed by the laws of the State of Delaware, except to the extent federal
law applies.


                                                IN WITNESS WHEREOF, the Company has
caused this Agreement to be signed by a duly authorized officer, and
Participant has affixed his signature hereto.


 


	
   

  	
  COMPANY:

  
	
   

  	
   

  	
   

  
	
   

  	
  EARTHLINK,
  INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  PARTICIPANT:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  SEAL)

  
	
   

  	
  Participant

  
	
   

  	
   

  	
   

  
				



 


 


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