Document:

Exhibit 10.3

 

EARTHLINK, INC.

EQUITY PLAN FOR NON-EMPLOYEE DIRECTORS

(as
amended effective May 8, 2008)

 

Restricted
Stock Unit Agreement

 

No. of Restricted
Stock

Units Awarded Hereunder:

 

THIS RESTRICTED
STOCK UNIT AGREEMENT (this “Agreement”) dated as of the
       day
of          ,
20    , between EarthLink, Inc., a Delaware
corporation (the “Company”), and
                    
(the “Participant”) is made pursuant and subject to the provisions of the
Company’s Equity Plan for Non-Employee Directors (as amended effective May 8,
2008) (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.                                        Award
of Units.  Pursuant to the Plan, the
Company, on
              
    , 20     (the “Date of Award”),
awarded to the Participant
           Restricted Stock
Units, each Restricted Stock Unit corresponding to one share of the Company’s
$0.01 par value Common Stock (this “Award”). 
Subject to the terms and conditions of the Plan, each Restricted Stock
Unit represents an unsecured promise of the Company to deliver, and the right
of the Participant to receive, one share of the $0.01 par value common stock of
the Company (the “Common Stock”) at the time and on the terms and conditions
set forth herein.  As a holder of
Restricted Stock Units, the Participant has only the rights of a general
unsecured creditor of the Company.

 

2.                                        Terms
and Conditions.  This Award is
subject to the following terms and conditions:

 

(a)                                  Expiration
Date.  This Award shall expire at
11:59 p.m. on           
    ,         (the “Expiration
Date”).

 

(b)                                 Vesting
of Award.

 

(i)                                     In
General.  Except as otherwise
provided below, one hundred percent (100%) of the outstanding Restricted Stock
Units shall become nonforfeitable and payable on the first annual anniversary
of the Date of Award, provided the Participant is still serving as a
Non-Employee Director at such time.

 

(ii)                                  Change in Control.  Outstanding Restricted Stock Units that are
not then nonforfeitable and payable shall become nonforfeitable and payable
immediately before the consummation of a Change in Control, provided the
Participant is still serving as a Non-Employee Director at such time.

 

(iii)                               Vesting
Date.  Outstanding Restricted Stock
Units shall be forfeitable until they become nonforfeitable and payable as
described above.  The date upon 

 

 

which
Restricted Stock Units become nonforfeitable and payable shall be referred to
as the “Vesting Date” with respect to such number of Restricted Stock Units.

 

(c)                                Settlement
of Award.  Subject to the terms of
this Section 2 and Section 3 below and except to the extent the
Participant defers receipt of such shares of Common Stock pursuant to Section 9
below,  the Company shall issue to
the Participant one share of Common Stock for each Restricted Stock Unit that
becomes nonforfeitable and payable under Section 2(b) above and shall
deliver to the Participant certificates representing such Shares as soon as
practicable after the Vesting Date.  As a
condition to the settlement of the Award, the Participant shall be required to
pay any required withholding taxes attributable to the Award in cash or cash
equivalent acceptable to the Board.  The
Company may allow the Participant to satisfy any such applicable withholding
taxes (i) by allowing the Participant to deliver shares of Common Stock
that the Participant already owns and, if necessary to avoid adverse accounting
consequences, has held for at least six months valued at their Fair Market
Value by a “net” settlement procedure on the day preceding such date (but only
for the minimum required withholding), (ii) through a cashless exercise
through a broker, (iii) by such other medium of payment as the Company
shall authorize, or (iv) by any combination of the allowable methods of
payment set forth herein.

 

3.                                        Termination
of Award.  Outstanding Restricted
Stock Units that have not become nonforfeitable and payable prior to the
Expiration Date shall expire and may not become nonforfeitable and payable
after such time.  Additionally, any
Restricted Stock Units that have not become nonforfeitable and payable on or
before the termination of the Participant’s service as a director of the
Company shall expire and may not become nonforfeitable and payable after such
time.

 

4.                                        Shareholder Rights.  The Participant shall not have any rights as
a shareholder with respect to shares of Common Stock subject to any Restricted
Stock Units until issuance of the certificates representing such shares of
Common Stock.  The Company may include on
any certificates representing shares of Common Stock issued pursuant to this
Award such legends referring to any representations, restrictions or any other
applicable statements as the Company, in its discretion, shall deem
appropriate.

 

5.                                        Nontransferability.  Except as described below, this Award is
nontransferable except by will or the laws of descent and distribution.  If this Award is transferred by will or the
laws of descent and distribution, the Award must be transferred in its entirety
to the same person or persons or entity or entities.  Notwithstanding the foregoing, the
Participant, at any time prior to the Participant’s death, may transfer all or
any portion of this Award to a Permitted Transferee.  In that event, the Permitted Transferee will
be entitled to all the rights of the Participant with respect to the
transferred Award (except that such Permitted Transferee may not assign the
Award other than by will or the laws of descent and distribution), and such
portion of the Award shall continue to be subject to all of the terms,
conditions and restrictions applicable to the Award as set forth herein and in
the Plan immediately prior to the effective date of the transfer.  Any such transfer will be permitted only if (i) the
Participant does not receive any consideration for the transfer and (ii) the
Board expressly approves the transfer. 
Any such transfer shall be evidenced by an appropriate written document
that the Participant executes and the Participant shall deliver a copy thereof
to the Board on or prior to the effective date of the 

 

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transfer.  No right or interest of the Participant in
this Award shall be liable for, or subject to, any lien, liability or
obligation of the Participant.

 

6.                                        Representation.  In connection with the acquisition of this
Award, the Participant represents and warrants that it is the Participant’s
intent to continue to serve as a director of the Company for the remainder of
Participant’s term as a director during which this Award is granted.

 

7.                                        Cash
Dividends.  For so long as the
Participant holds outstanding Restricted Stock Units, if the Company pays any
cash dividends on its Common Stock, then the Company in its discretion (a) may
pay the Participant in cash for each outstanding Restricted Stock Unit covered
by this Award as of the record date for such dividend, less any required
withholding taxes, the per share amount of such dividend or (b) may
increase the number of outstanding Restricted Stock Units covered by this Award
by the number of Restricted Stock Units, rounded down to the nearest whole
number, equal to (i) the product of the number of the Participant’s
outstanding Restricted Stock Units as of the record date for such dividend
multiplied by the per share amount of the dividend divided by (ii) the
Fair Market Value of a share of Common Stock on the payment date of such
dividend.  In the event the Company
awards additional Restricted Stock Units pursuant to this Section 7, such
Restricted Stock Units shall be subject to the same terms and conditions set
forth in the Plan and herein as the outstanding Restricted Stock Units with
respect to which they were granted. 
Notwithstanding the foregoing, the Company in its sole discretion may
choose not to pay the cash amounts described above and not to increase the
number of outstanding Restricted Stock Units covered by this Award, and this Section 7
shall not constitute any agreement or commitment that the Company take any such
actions.

 

8.                                        Change
in Capital Structure.  The terms of
this Award shall be adjusted in accordance with the terms and conditions of the
Plan if the Company effects one or more stock dividends or stock splits.  If there is a subdivision or consolidation of
shares or other similar change in capitalization other than as a result of
stock dividends or stock splits, the Board may adjust the terms of this Award
to the extent the Board in its discretion may consider appropriate.

 

9.                                        Deferral
of Common Stock.  If the Participant
is eligible to participate in the Deferred Compensation Program, then the
Participant may elect to defer the receipt of Common Stock issuable pursuant to
this Award in accordance with rules the Board prescribes for the Deferred
Compensation Program.  If the Participant
elects to defer the receipt of Common Stock hereunder, the shares of Common
Stock shall be deferred and credited under the Deferred Compensation Program
and shall become payable and issuable pursuant to the terms and at such time or
times as set forth in the Deferred Compensation Program, but will be paid, if
at all, only in shares of Common Stock.

 

10.                                  Golden
Parachute Provisions.

 

(a)                                If
any payment to the Participant hereunder or in conjunction with any other
payment pursuant to any other agreement, policy, plan or program would subject
the Participant to an excise tax imposed by Code Section 4999 or to any
similar tax imposed by state or local law or any related interest or penalties
(such tax or taxes, together with any such interest or penalties, being hereinafter
collectively referred to as the “Excise Tax”), then the payments 

 

3

 

provided under
this Agreement shall be reduced (but not below zero) if, and only to the extent
that, such reduction will allow the Participant to receive a greater “Net After
Tax Amount” than the Participant would receive absent any such reduction.  “Net After Tax Amount” means the amount of
any Parachute Payments (as defined in (b) below) or Capped Payments (as
defined in (c) below), as applicable, net of taxes imposed under Code
Sections 1, 3101(b) and 4999 and any State or local income taxes
applicable to the Participant on the date of payment.  The determination of the Net After Tax Amount
shall be made using the highest combined effective rate imposed by the
foregoing taxes on income of the same character as the Parachute Payments or
Capped Payments, as applicable, in effect on the date of payment.

 

(b)                                 The
independent accounting firm that the Company, in its sole discretion, engages
(the “Accounting Firm”) will first determine the amount of any “Parachute
Payments” that are payable to the Participant. 
“Parachute Payment” means a payment that is described in Code Section 280G(b)(2),
determined in accordance with Code Section 280G and the regulations
promulgated or proposed thereunder.  The
Accounting Firm also will determine the Net After Tax Amount attributable to
the Participant’s total Parachute Payments.

 

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

 

(d)                                 The
Participant then will receive the total Parachute Payments or the Capped
Payments, whichever provides the Participant with the higher Net After Tax
Amount.  If the Participant will receive
the Capped Payments (i.e. some amount less than the total Parachute Payments),
the total Parachute Payments will be adjusted by first reducing the amount of
any benefits under this Agreement or the noncash benefits under any other plan,
agreement or arrangement (with the source of the reduction to be directed by
the Participant) and then by reducing the amount of any cash benefits under any
other plan, agreement or arrangement (with the source of the reduction to be
directed by the Participant).  The
Accounting Firm will notify the Participant and the Company if it determines
that the Parachute Payments must be reduced and will send the Participant and
the Company a copy of its detailed calculations supporting that determination.

 

(e)                                  As
a result of the uncertainty in the application of Code Sections 280G and 4999
at the time that the Accounting Firm makes its determinations under this Section 10,
it is possible that amounts will have been paid or distributed to the
Participant that should not have been paid or distributed under this Section 10
(“Overpayments”), or that additional amounts should be paid or distributed to
the Participant under this Section 10 (“Underpayments”).  If the Accounting Firm determines, based on
either the assertion of a deficiency by the Internal Revenue Service against
the Company or the Participant, which assertion the Accounting Firm believes
has a high probability of success or controlling precedent or substantial
authority, that an Overpayment has been made, that Overpayment will be treated
for all purposes as a loan that the Participant must repay to the Company
together with interest at the applicable federal rate under Code Section 7872(f)(2);
provided, however, that no loan will be deemed to have been made and no amount
will be payable by the Participant to the Company unless, and then only to the
extent that, the deemed loan and payment would either reduce the amount on
which the 

 

4

 

Participant is
subject to tax under Code Sections 1, 3101 or 4999 or generate a refund of such
taxes.  If the Accounting Firm determines,
based upon controlling precedent or other substantial authority, that an
Underpayment has occurred, the Accounting Firm will notify the Participant and
the Company of that determination and the amount of that Underpayment will be
paid to the Participant promptly by the Company.

 

(f)                                    The
fees and expenses of the Accounting Firm for its services in connection with
the determinations and calculations contemplated by the preceding subsections
shall be borne by the Company.  If such
fees and expenses are initially paid by Participant, the Company shall
reimburse Participant the full amount of such fees and expenses within five
business days after receipt from Participant of a statement therefor and
reasonable evidence of Participant’s payment thereof.

 

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

 

(h)                                 The
federal, state and local income or other tax returns filed by the Participant
shall be prepared and filed on a consistent basis with the determination of the
Accounting Firm with respect to the any such Excise Tax payable by Participant.  The Participant, at the request of the
Company, shall provide the Company true and correct copies (with any
amendments) of the Participant’s federal income tax returns as filed with the
Internal Revenue Service and corresponding state and local tax returns, if
relevant, as filed with the applicable taxing authority, and such other
documents reasonably requested by the Company, evidencing such conformity.

 

11.                                  Notice.  Any notice or other communication given
pursuant to this Agreement, or in any way with respect to the Award, shall be
in writing and shall be personally delivered or mailed by United States
registered or certified mail, postage prepaid, return receipt requested, to the
following addresses:

 

If to the Company:                                                                                           EarthLink, Inc.

1375 Peachtree Street - Level A

Atlanta, Georgia 30309

Attention:  General Counsel

 

If to the Participant:                                                                                                                                             

                                                      

                                                      

 

12.                                  No
Right to Continued Service.  Neither
the Plan, the granting of this Award nor any other action taken pursuant to the
Plan or this Award constitutes or is evidence of any 

 

5

 

agreement or
understanding, express or implied, that the Company will retain the Participant
as a director for any period of time or at any particular rate of compensation.

 

13.                                  Participant
Bound by Plan.  The Participant
hereby acknowledges receipt of a copy of the Plan and agrees to be bound by all
the terms and provisions of the Plan.

 

14.                                  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 distributees, legatees and personal representatives of the
Participant and the successors of the Company.

 

15.                                  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.

 

16.                                  Counterparts.  This Agreement may be executed in a number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one in the same instrument.

 

17.                                  Miscellaneous.  The parties agree to execute such further
instruments and take such further actions as may be necessary to carry out the
intent of the Plan and this Agreement. 
This Agreement and the Plan shall constitute the entire agreement of the
parties with respect to the subject matter hereof.

 

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

 

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

 

	
   

  	
  COMPANY:

  
	
   

  	
   

  
	
   

  	
  EARTHLINK,
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Rolla
  P. Huff

  
	
   

  	
  Chief
  Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PARTICIPANT:

  
	
   

  	
   

  
	
   

  	
   

  

 

7Exhibit 10.4

 

EARTHLINK, INC.

2006 EQUITY AND CASH INCENTIVE PLAN

 

Restricted Stock Unit Agreement

 

No. of Restricted Stock

Units Awarded Hereunder:  400,000

 

THIS RESTRICTED STOCK UNIT
AGREEMENT (this “Agreement”) dated as of the 8th day of February, 2008, between
EarthLink, Inc., a Delaware corporation (the “Company”), and Rolla P. Huff
(the “Participant”) is made pursuant and subject to the provisions of the
Company’s 2006 Equity and Cash Incentive 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,
except that the term “Change in Control Event” shall have the meaning given it
in the Employment Agreement dated June 25, 2007 between the Participant
and the Company (the “Employment Agreement”).

 

1.                                       Grant of Restricted Stock Units.  Pursuant
to the Plan, the Company, on February 8, 2008 (the “Date of Grant”),
granted to the Participant Four Hundred Thousand (400,000) restricted stock
units (the “Restricted Stock Units”), each Restricted Stock Unit corresponding
to one share of the Common Stock of the Company (this “Award”).  Subject to the terms and conditions of the
Plan, each Restricted Stock Unit represents an unsecured promise of the Company
to deliver, and the right of the Participant to receive, one share of the
Common Stock of the Company at the time and on the terms and conditions set
forth herein.  As a holder of Restricted
Stock Units, the Participant has only the rights of a general unsecured
creditor of the Company.

 

2.                                       Terms and Conditions.  This
Award is subject to the following terms and conditions:

 

(a)                            Expiration
Date.  This Award shall expire at
11:59 p.m. on February 8, 2018 (the “Expiration Date”).  In no event shall the Expiration Date be later
than 10 years from the Date of Grant.

 

(b)                           Vesting
of Award.

 

(i)                                     In
General.  The Restricted Stock Units
shall be considered “Performance-Based” and shall become eligible to be earned
and payable with respect to that number of the Restricted Stock Units that
correlates to the level of Free Cash
Flow of the Company achieved during the calendar year 2008, as the
Committee in its sole discretion shall establish and set forth on the attached Exhibit A,
provided there is not a Change in Control Event during 2008.  Notwithstanding the foregoing, if at any time
during 2008 there is a Change in Control Event, then the outstanding Restricted
Stock Units shall become eligible to be earned and payable based on actual
performance from the beginning of 2008 through the date of the Change in
Control Event (annualized based on the portion of 2008 preceding the Change in
Control Event).  More specifically,
assessment of actual performance shall be determined in the following manner:  the number of Restricted Stock Units that
shall become eligible to be earned 

 

 

and payable shall equal the aggregate number
of Restricted Stock Units set forth on Exhibit A  multiplied by a fraction, the numerator of
which is the level of Free Cash Flow of
the Company achieved during 2008 through the date of the Change in
Control Event (annualized based on the portion of 2008 preceding the Change in
Control Event) and the denominator of which is the level of Free Cash Flow of the Company that the
Committee set forth on the attached Exhibit A for 2008.  The outstanding Restricted Stock Units that
become eligible to be earned and payable under either of the preceding
sentences shall then become earned and payable as to fifty percent (50%) of
such eligible Restricted Stock Units on each of the second and third
anniversaries of the Date of Grant, provided the Participant has been
continuously employed by, or providing services to, the Company or an Affiliate
from the Date of Grant until each such anniversary of the Date of Grant.

 

For purposes of this Award, (A) “EBITDA”
means earnings before interest, taxes, depreciation and amortization; (B) “Adjusted
EBITDA” means EBITDA excluding facility exit and restructuring costs, equity
method loss of affiliates, and gain (loss) on investments in other companies;
and (C) “Free Cash Flow” means Adjusted EBITDA less capital expenditures
and cash used to purchase customer bases (as more specifically set forth on Exhibit A).  In determining if the level of Free Cash Flow of the Company has been
achieved, the performance targets shall be adjusted in the event of any
unbudgeted acquisition, divestiture or other unexpected fundamental change in
the business of the Company that is material taken as whole, as appropriate to
fairly and equitably determine the Restricted Stock Units to become eligible to
be earned and payable so as to preclude the enlargement or dilution of the
Participant’s rights hereunder.

 

Notwithstanding any other
provision of this Agreement, none of the Performance-Based Restricted Stock
Units shall be eligible to become earned and payable if the actual performance
for 2008 (or the annualized actual performance for the period through the
Change in Control Event) does not at least equal the minimum threshold targets
set forth on the attached Exhibit A.

 

(ii)                                  Termination
of Employment After a Change in Control Event.  Notwithstanding the foregoing, if in
connection with a Change in Control Event the Participant’s employment is
terminated by the Company or an Affiliate for any reason other than Cause and
other than on account of “Total Disability” (as such term is defined in the
Employment Agreement) or death or is terminated by the Participant for “Good
Reason” (as such term is defined in the Employment Agreement), then, the
aggregate number of the Restricted Stock Units described in Section 2(b)(i) above
that are eligible to become earned and payable shall become earned and payable
in full on termination of the Participant’s employment.  For purposes of this Section 2(b)(ii), a
termination of employment will be deemed to be in connection with a Change in
Control Event if it occurs on or after the Change in Control Event or during
the three-month period immediately preceding the Change in Control Event.

 

(iii)                               Termination
of Employment before a Change in Control Event.  Notwithstanding the foregoing, if at any time
before a Change in Control Event but after the end of 2008 the Participant’s
employment is terminated by the Company for any reason other than Cause and
other than on account of Total Disability or death or is terminated by the
Participant for Good Reason, then, to the extent not vested previously, the
aggregate number of outstanding Restricted Stock Units shall become earned and
payable in full on termination of the 

 

 

Participant’s employment with respect to that
number of the Restricted Stock Units that correlates to the level of Free Cash Flow of the Company that is achieved during 2008.  Notwithstanding the foregoing, except to the
extent provided by the last sentence of Section 2(b)(ii) above, if at any
time before a Change in Control Event and during 2008 the Participant’s
employment is terminated by the Company or an Affiliate for any reason other
than Cause and other than on account of Total Disability or death or is
terminated by the Participant for Good Reason, then none of the outstanding
Restricted Stock Units shall become earned and payable on termination of the
Participant’s employment unless the following sentence applies.  If the Participant’s employment is terminated
for any reason other than Cause and other than on account of Total Disability
or death or is terminated by the Participant for Good Reason during 2008 and a
Change in Control Event occurs thereafter and before the end of 2008, then the
aggregate number of the outstanding Restricted Stock Units that would have
become eligible to be earned and payable as a result of the Change in Control
Event, assuming the Participant had remained employed by, or providing services
to, the Company or an Affiliate from the Date of Grant until the Change in
Control Event, shall become earned and payable in full on the date of the
Change in Control Event.  Except to the
extent provided by the last sentence of Section 2(b)(ii) above, if
the Participant’s employment is terminated for any reason other than Cause and
other than on account of Total Disability or death or is terminated by the
Participant for Good Reason during 2008 and a Change in Control Event occurs
after the end of 2008, then none of the outstanding Restricted Stock Units shall
become earned and payable.

 

(iv)                              Vesting
Date.  Outstanding Restricted Stock
Units shall be forfeitable until they become earned and payable as described
above.  Each date upon which Restricted
Stock Units become earned and payable shall be referred to as a “Vesting Date”
with respect to such number of Restricted Stock Units.

 

(c)                            Settlement
of Award.  Subject to the terms of
this Section 2 and Section 3 below, and except to the extent the
Participant defers receipt of such shares of Common Stock pursuant to Section 8
below, the Company shall issue to the Participant one share of Common Stock for
each Restricted Stock Unit that has become earned and payable under Section 2(b) above
and shall deliver to the Participant certificates representing such shares as
soon as practicable after (and within thirty (30) days of) the respective
Vesting Date.  As a condition to the
settlement of the Award, the Participant shall be required to pay any required
withholding taxes attributable to the Award in cash or cash equivalent
acceptable to the Committee.  However,
the Company in its discretion may, but is not required to, allow the
Participant to satisfy any such applicable withholding taxes (i) by
allowing the Participant to surrender shares of Common Stock that the Participant
already owns (but only for the minimum required withholding), (ii) through
a cashless transaction through a broker, (iii) by such other medium of
payment as the Committee shall authorize or (iv) by any combination of the
allowable methods of payment set forth herein.

 

3.                                       Termination of Award. 
Notwithstanding any other provision of this Agreement, outstanding
Restricted Stock Units that have not become earned and payable prior to the
Expiration Date shall expire and may not become earned and payable after such
time.  Additionally, any Restricted Stock
Units that have not become earned and payable on or before the termination of
the Participant’s employment with the Company and any Affiliate shall expire
and may not become earned and payable after such time, except as described in Section 2(b)(iii) above.

 

 

4.                                       Shareholder Rights.  Except as
set forth in Section 6 below, the Participant shall not have any rights as
a shareholder with respect to shares of Common Stock subject to any Restricted
Stock Units until issuance of the certificates representing such shares of
Common Stock.  The Company may include on
any certificates representing shares of Common Stock issued pursuant to this
Award such legends referring to any representations, restrictions or any other
applicable statements as the Company, in its discretion, shall deem
appropriate.

 

5.                                       Transferability.  Except as provided herein, this
Award is nontransferable except by will or the laws of descent and
distribution.  If this Award is
transferred by will or the laws of descent and distribution, the Award must be
transferred in its entirety to the same person or persons or entity or
entities.  Notwithstanding the foregoing,
the Participant, at any time prior to the Participant’s death, may transfer all
or any portion of this Award to the Participant’s children, grandchildren,
spouse, one or more trusts for the benefit of such family members or a
partnership in which such family members are the only partners, on such terms
and conditions as are appropriate for such transferees to be included in the
class of transferees who may rely on a Form S-8 registration statement
under the Securities Act of 1933 to sell shares received pursuant to the
Award.  Any such transfer will be
permitted only if (i) the Participant does not receive any consideration
for the transfer and (ii) the Committee expressly approves the
transfer.  Any transferee to whom this
Award is transferred shall be bound by the same terms and conditions that
governed the Award during the time it was held by the Participant (which terms
and conditions shall still be read from the perspective of the Participant);
provided, however, that such transferee may not transfer the Award except than
by will or the laws of descent and distribution.  Any such transfer shall be evidenced by an
appropriate written document that the Participant executes and the Participant
shall deliver a copy thereof to the Committee on or before the effective date
of the transfer.  No right or interest of
the Participant or any transferee in this Award shall be liable for, or subject
to, any lien, liability or obligation of the Participant or transferee.

 

6.                                       Cash Dividends.  For so long as the Participant
holds outstanding Restricted Stock Units under this Award, if the Company pays
any cash dividends on its Common Stock, then the Company will pay the
Participant in cash for each outstanding Restricted Stock Unit covered by this
Award as of the record date for such dividend, less any required withholding
taxes, the per share amount of such dividend that the Participant would have
received had the Participant owned the underlying shares of Common Stock as of
the record date of the dividend if, and only if, the Restricted Stock Units
become earned and payable and the related shares of Common Stock are issued to
the Participant.  In that case, the
Company shall pay such cash amounts to the Participant, less any required
withholding taxes, at the same time the related shares of Common Stock are
delivered.  The additional payments pursuant
to this Section 6 shall be treated as a separate arrangement.

 

7.                                       Change in Capital Structure.  The terms
of this Award shall be adjusted in accordance with the terms and conditions of
the Plan as the Committee determines is equitably required in the event the
Company effects one or more stock dividends, stock splits, subdivisions or
consolidations of shares or other similar changes in capitalization.

 

8.                                       Deferral of Common Stock.  If the
Participant is eligible to participate in the Deferred Compensation Program,
then the Participant may elect to defer the receipt of Common 

 

 

Stock issuable pursuant to this
Award in accordance with rules the Committee prescribes for the Deferred
Compensation Program.  If the Participant
elects to defer the receipt of Common Stock hereunder, the shares of Common
Stock shall be deferred and credited under the Deferred Compensation Program
and shall become payable and issuable pursuant to the terms and at such time or
times as set forth in the Deferred Compensation Program, but will be paid, if
at all, only in shares of Common Stock. 
None of the cash dividends that a Participant is eligible to receive
pursuant hereto may be deferred or credited under the Deferred Compensation Program.

 

9.                                       Notice.  Any notice or other communication
given pursuant to this Agreement, or in any way with respect to the Award,
shall be in writing and shall be personally delivered or mailed by United
States registered or certified mail, postage prepaid, return receipt requested,
to the following addresses:

 

If to the Company:                                                                                             EarthLink, Inc.

1375 Peachtree Street - Level A 

Atlanta, Georgia 30309

Attention:  General Counsel

 

If to the Participant:                                                                                       Rolla
P. Huff

14 Moraine Point

Victor, NY  14564

 

10.                                 No Right to Continued Employment or Service.  Neither
the Plan, the granting of this Award nor any other action taken pursuant to the
Plan or this Award constitutes or is evidence of any agreement or
understanding, express or implied, that the Company or any Affiliate will
retain the Participant as an employee or other service provider for any period
of time or at any particular rate of compensation.

 

11.                                 Agreement to Terms of Plan and Agreement.  The
Participant has received a copy of the Plan, has read and understands the terms
of the Plan and this Agreement, and agrees to be bound by their terms and
conditions.

 

12.                                 Tax Consequences.  The Participant acknowledges that
(i) there may be adverse tax consequences upon acquisition or disposition
of the shares of Common Stock issued pursuant to this Award or the receipt of
cash dividends hereunder and (ii) Participant should consult a tax adviser
prior to such acquisition or disposition or receipt.  Except as provided in Section 18 below,
the Participant is solely responsible for determining the tax consequences of
the Award and for satisfying the Participant’s tax obligations with respect to
the Award.

 

13.                                 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 distributees, legatees and personal representatives of the
Participant and the successors of the Company.

 

14.                                 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.

 

 

15.                                 Counterparts.  This Agreement may be executed in
a number of counterparts, each of which shall be deemed an original, but all of
which together shall constitute one in the same instrument.

 

16.                                 Miscellaneous.  The parties agree to execute such
further instruments and take such further actions as may be necessary to carry
out the intent of the Plan and this Agreement. 
This Agreement and the Plan shall constitute the entire agreement of the
parties with respect to the subject matter hereof.

 

17.                                 Restrictive Covenants.

 

(a)                            In the event the Participant receives the
special enhanced vesting set forth in Section 2(b)(iii) above, the
Participant agrees that during Participant’s employment, and for a period of
eighteen (18) calendar months following Participant’s termination of
employment, that Participant will not, directly or indirectly, (i) solicit,
induce, recruit, or cause a “restricted employee” to resign employment with the
Company or its Affiliates, or (ii) participate in making hiring decisions,
encourage the hiring of, or aid in the hiring process of a “restricted employee”
on behalf of any employer other than the Company and its Affiliates.  As used herein, “restricted employee” means
any employee of the Company or its Affiliates with whom the Participant had
material business-related contact while performing services for the Company and
its Affiliates and who is (x) a member of executive management, (y) a
corporate officer of the Company or any of its Affiliates, or (z) any
employee of the Company or any of its Affiliates engaged in product or service
development or product or service management.

 

(b)                           In the event the Participant receives
the special enhanced vesting set forth in Section 2(b)(iii) above,
the Participant also agrees that during the Participant’s employment, and for a
period of eighteen (18) calendar months following termination of Participant’s
employment, the Participant shall not perform within the fifty (50) states of
the United States of America any services which are in competition with the “business”
of the Company during Participant’s employment, or following Participant’s
termination of employment, any services which are in competition with a “material”
line of “business” engaged in by the Company at the time of Participant’s
termination of employment which are the same as or similar to those services
Participant performed for the Company or any Affiliate; provided, however, that
if the other business competitive with the business the Company has multiple
lines, divisions, segments, or units, some of which are not competitive with
the business of the Company, nothing herein shall prevent Participant from
being employed by or providing services to such line, division, segment, or
unit that is not competitive with the business of the Company.  For purposes of this Agreement, “material”
means a line of business that represents 20% or more of the Company’s
consolidated revenues or adjusted EBITDA for the four fiscal quarters
immediately preceding the Participant’s termination of employment.  As used herein, “business” means the business
of providing integrated communication services and related value added services
to individual customers and business customers.

 

(c)                            The enhanced vesting pursuant to Section 2(b)(iii) above
(along with the related cash dividends under Section 6 above) are
conditioned upon the Participant’s compliance with the provisions of this Section 17.  In the event the Participant shall materially
breach the provisions of this Section 17 and not cure or cease (as
appropriate) such material breach within 

 

 

ten (10) days of receipt
of notice thereof from the Company, the vesting above shall terminate and
Participant shall return to the Company all of the shares of Common Stock and
cash dividends received in connection therewith.  Termination of such vesting and payments
shall not be the Company’s sole and exclusive remedy for a breach of this Section 17.  In addition, the Company shall be entitled to
damages and injunctive relief to enforce this Section 17 in the event of a
breach by the Participant.  Additionally,
in the event the Participant materially breaches this provision, the
Participant shall be required to repay to the Company all amounts previously
paid pursuant to Section 2(b)(iii) and the related cash dividends
paid pursuant to Section 6 above.

 

18.                                 Section 409A.  Notwithstanding any other provision of this
Agreement, it is intended that payments hereunder will not be considered
deferred compensation within the meaning of Section 409A of the Code.  For purposes of this Agreement, all rights to
payments hereunder shall be treated as rights to receive a series of separate
payments and benefits to the fullest extent allowed by Section 409A of the
Code.  Payments hereunder are intended to
satisfy the exemption from Section 409A of the Code for “short-term
deferrals.”  To the extent that the
Participant incurs liability for excise taxes, penalties or interest under Section 409A
of the Code because this Agreement fails to comply with, or be exempt from, Section 409A,
the Company will make a special reimbursement payment to the Participant equal
to the sum of (i) the Participant’s liability for excise taxes, penalties
or interest under Section 409A and (ii) all taxes attributable to the
special reimbursement payment, such payment to be made on or before the time
the Participant is required to pay such taxes, penalties or interest.

 

19.                                 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 the Participant has affixed his signature hereto.

 

	
   

  	
  COMPANY:

  
	
   

  	
   

  
	
   

  	
  EARTHLINK, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name: 

  	
  Kevin Dotts

  
	
   

  	
  Title: 

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  PARTICIPANT:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Rolla P. Huff

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