Exhibit 10.03
 
Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits information subject to the confidentiality request.
Omissions are designated as [*****]. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission.
 

 AMENDMENT NUMBER TWO
TO
GOOGLE ADWORDS RESELLER AGREEMENT
 
 
This  Amendment  Number  Two  (the “Amendment”) is  effective  as of  1 June
2012 (the “Amendment Effective Date”) and is entered into by and between:
 
(1) Google Ireland Limited, whose registered office is located at Gordon House,
Barrow Street, Dublin 4,
Republic of Ireland (“Google”), and
 
(2) ReachLocal Europe BV (f/k/a ReachLocal Netherlands BV), whose registered
office is located at Strawinskylaan 337, WTC tower B, 1077 XX Amsterdam, The
Netherlands (“Reseller”),
 
Hereinafter called each a “Party”, and together the “Parties”.
 
BACKGROUND AND INTERPRETATION:
 
(A)
The Parties have signed a Google AdWords Reseller Agreement effective as of 1
May 2011 (the “Agreement”).

(B)
Pursuant to Amendment One (defined below), Google offered and Reseller
benefitted from, an additional incentive in addition to the Performance Bonus
contemplated in the Agreement (the “Pilot”).

(C)
The parties now wish to extend the Pilot for an additional three month period
for certain Territories only  (the  United  Kingdom  and the  Netherlands),  on
 the terms  of  this  Amendment  (the “Pilot Extension”).

(D)
This Amendment is supplementary to and forms part of the Agreement and terms not
defined in this Amendment shall have the meaning given to them in the Agreement.
If any term in this Amendment conflicts with any term in the Agreement, then
this Amendment shall prevail.

(E)
The Agreement shall remain in full force and effect, amended only as modified by
this Amendment. This Amendment may be executed in one or more counterparts, all
of which shall be considered one and the same agreement.

(F)
The parties acknowledge that the guarantee entered into between Google and
ReachLocal Inc. whose registered office is located at 21700 Oxnard Street, Suite
1600, Woodland Hills, CA 91367, United States with an effective date
of 1 May 2011 (the “Guarantee”) shall remain in full force and effect
notwithstanding this amendment of the Agreement, in accordance with clause 4 of
the Guarantee.

THE PARTIES HAVE AGREED AS FOLLOWS:
 
In consideration for the payment of £1 by Google to Reseller, receipt and
sufficiency of which is hereby acknowledged by Reseller, the parties have agreed
to amend the Agreement for the duration of the Amendment Term by adding the
following provisions:
 
1
Pilot Extension

 
1.1
Pilot Extension Requirements. In order to meet the “Pilot Extension
Requirements” each Qualified Advertiser participating in the Pilot Extension (a
“Pilot Extension Advertiser”) must:

 
1.1.1 
have a principal place of business located in either the Netherlands or the
United Kingdom;

1.1.2 
purchase and begin serving AdWords Inventory within 3 months of the Amendment
Effective Date; and

1.1.3
meet the Share to AdWords Objective for the first seven consecutive months
following Activation of their Adwords account (the “Qualification Period”).

For the purpose of clause 1.1.3 of this Amendment only, the definition of Share
to Adwords Objective set out in each of Part C and Part D of Exhibit C of the
Agreement, shall be adjusted such that references to the “Performance Period”
shall be deemed to be replaced with “Qualification Period”.
 
 
 

--------------------------------------------------------------------------------

 
 
1.2
Payment; Credit. Upon Reseller’s full payment to Google as required in the
Agreement, Google will:

 
1.2.1
pay to Reseller the Performance Bonus earned for each Pilot Extension Advertiser
in the manner as set forth in Exhibit C of the Agreement; and

1.2.2
upon fulfillment of the Pilot Extension Requirements by a Pilot Extension
Advertiser, issue a credit (the “Additional Incentive”) to  Reseller  in
 Reseller’s  AdWords account (to be applied to the following month’s  invoice)
 equal  to the amount  of:

(i)
[*****];

(ii)
[*****].

1.2.3
[*****].

 
1.3
For the purpose of clause 1.2.2(i) of this Amendment only, a Pilot Extension
Advertiser’s Eligible Adwords Spend for the relevant month shall be calculated
as follows:

 
 
[*****].

 
1.4
For the purpose of clause 1.2.2 (ii) above, in the event that the first six
months of the Qualification Period do not correspond with two complete
Performance Periods, the amount attributable to any partial Performance Period
shall be calculated on a daily pro rata basis.

 
1.5
If (i) the Agreement is terminated during the Amendment Term in accordance with
clause 13 of the Agreement, or (ii) this Amendment is terminated in accordance
with clause 2 of this Amendment, Google shall not pay to Reseller any Additional
Incentive in respect of any Pilot Extension Advertiser whose Qualification
Period is not yet complete.

 
2
Amendment Term and Termination

 
2.1
This Amendment shall commence on the Amendment Effective Date and shall end 3
months after the Amendment Effective Date (“Amendment Term”), unless earlier
terminated in accordance with clause 2.2 below. Subject to clause 2.3 of this
Amendment, upon the expiry of the Amendment Term, this amendment shall
automatically terminate and the amendments contained within it shall cease to
apply to the Agreement.

 
2.2
Google may terminate this Amendment at any time, on sixty (60) days written
notice to Reseller.

 
2.3
Terms of this Amendment which relate to the calculation and payment of the
Additional Incentive shall survive termination or expiry of this Amendment in so
far as is necessary to complete such calculations and payment.

 
2.4
If the Agreement is terminated during the Amendment Term which Amendment shall
automatically terminate at the same time as the Agreement.

 
 
Confidential material redacted and filed separately with the Securities and
Exchange Commission.
 
 
2

--------------------------------------------------------------------------------

 
 
3
Reporting

 
3.1
To enable calculation of the Additional Incentive, at the end of the Amendment
Term Reseller shall provide Google with a report in respect of all Pilot
Extension Advertisers. Such report shall contain the information and shall be in
the form, specified below (and shall be in Google Docs, Microsoft Excel or CSV
format):

 
Customer ID
Existing/New
Date of Sale
Retail  Package
Google Spend
Length of Contract the Advertiser is Offered
 
 
         
 
 
         

 
4
Amendment Number One.

 
4.1
The parties acknowledge, for the avoidance of doubt, that amendment number one
to the Agreement, entered into by the parties on 16 November 2011 (“Amendment
One”) has expired in accordance with its terms.

 
Signed by the Parties on the dates stated below.
 
 
GOOGLE IRELAND LTD
 
RESELLER
 
By:
/s/ Ailis Daly
 
By:
/s/ John Mazur
         
Print Name:  Ailis Daly
 
Print Name:  John Mazur
 
Title: Contracts Administrator
 
Title:  CEO, ReachLocal Europe BV
         
Date:  June 6, 2012
 
Date:  May 31, 2012
 

 
 
 
 
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