Earthlink 2005 Annual Report Download - page 28

In addition, the stock market in general and the market prices for Internet-related companies in particular, have experienced volatility that
often has been unrelated to the operating performance of such companies. These broad market and industry fluctuations may adversely affect
the price of our stock, regardless of our operating performance. Additionally, volatility or a lack of positive performance in our stock price may
adversely affect our ability to retain key employees, many of whom have been granted stock incentive awards.
Provisions in our second restated certificate of incorporation, amended and restated bylaws and other elements of our capital structure
could limit our share price and delay a change of management.
Our second restated certificate of incorporation, amended and restated bylaws and shareholder rights plan contain provisions that could
make it more difficult or even prevent a third party from acquiring us without the approval of our incumbent board of directors. These
provisions, among other things:
• divide the board of directors into three classes, with members of each class to be elected in staggered three-year terms;
•
limit the right of stockholders to call special meetings of stockholders; and
•
authorize the board of directors to issue preferred stock in one or more series without any action on the part of stockholders.
These provisions could limit the price that investors might be willing to pay in the future for shares of our common stock and significantly
impede the ability of the holders of our common stock to change management. In addition, we have adopted a rights plan, which has anti-
takeover effects. The rights plan, if triggered, could cause substantial dilution to a person or group that attempts to acquire our common stock
on terms not approved by the board of directors. Provisions and agreements that inhibit or discourage takeover attempts could reduce the
market value of our common stock.
Item 1B.
Unresolved Staff Comments.
None.
Item 2.
Properties.
We currently maintain and occupy the following principal properties:
Our principal executive offices are in Atlanta, Georgia. We also maintain and occupy certain other leased space for operations and
administrative purposes. Certain of our leases include scheduled base rent increases over the respective lease terms. The total amount of base
rent payments, net of allowances and incentives, is being charged to expense using the straight-line method over the terms of the leases. In
addition to the base rent payments, we generally pay a monthly allocation of the buildings’ operating expenses. We believe we have adequate
facilities to meet our future growth needs.
We have three technology centers at various locations in the U.S. which contain computer and electronic equipment. We own one and
lease two of our three technology centers. The technology centers have a combined square footage of approximately 23,000 feet. Our
technology centers host and manage Internet content, email, web hosting and authentication applications and services. We may acquire
additional amounts of storage and processing capacity in relatively small increments and, consequently, we
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Facilities
Location
Approximate
Square Feet
Lease
Expiration
Principal executive and corporate offices
Atlanta, GA
328,000
2014
Operations and corporate offices
Pasadena, CA
141,000
2014
Operations and corporate offices
San Francisco, CA
26,000
2007