Exhibit 10.66

Covenants Rider

MASTER RIDER NO. 01

This Rider dated September 30, 2009 amends and incorporates that certain Master
Lease Agreement dated as of April 6, 2007 (the “Lease”) between CITY NATIONAL
BANK (“Lessor”) and LOOKSMART, LTD. (“Lessee”).

This Rider hereby supersedes and replaces in its entirety the Master Rider
No. 01 signed and dated May 13, 2009.

FINANCIAL COVENANTS

A. ADDITIONAL EVENTS OF DEFAULT.

The following shall constitute additional Events of Default under the Master
Lease No. 517179001, dated April 6, 2007:

 

1. Failure of Lessee to furnish CNB, within the times specified, the following
statements:

1.1 Copies of weekly account statements as of each Friday, from all brokerage
firms and financial institutions in which Borrower maintains accounts containing
its Liquid Assets, certified by Looksmart to be in compliance with the terms of
section 3.2 of this Agreement and delivered no later than the following Tuesday.

1.2 Such additional information, reports and/or statements as CNB may, from time
to time, reasonably request;

 

2. Failure of Lessee to submit a Form 10-K or Form 10-Q on or before the filing
deadlines set forth by the Securities and Exchange Commission;

 

3. Failure of Lessee to either (i) maintain the following, or (ii) provide CNB
with cash collateral in the amount due under the Master Lease, upon fifteen
(15) days notice:

3.1 Tangible Net Worth of not less than $22,000,000.00 at all times;

3.2 Liquid Assets of not less than $22,000,000.00 at all times;

 

4. Lessee or any guarantor of the Master Lease materially defaults in the
payment or performance of any obligation, or defaults under any provision of any
contract or instrument pursuant to which any of such parties has incurred any
obligation for borrowed money, any purchase obligation or any other liability of
any kind to any person or entity, including CNB;

 

5. Any sale or transfer of all or a substantial or material part of the assets
of Lessee other than in the ordinary course of business, without CNB’s prior
written consent;

 

6. Failure of Lessee to pay and discharge all taxes, assessments, governmental
charges and real and personal property taxes prior to the date upon which
penalties are attached;

 

7. Failure of Lessee to maintain in full force and effect insurance for its
business, including, without limitation, fire, public liability, property
damage, business interruption and extra expense and worker’s compensation, in
amounts, in form and substance, and issued by an insurance company, acceptable
to CNB, provided that CNB provides thirty (30) days written notice that said
failure constitutes an Event of Default;

 

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8. Failure of Lessee to qualify for continued listing in the NASDAQ Global
Market;

 

9. Lessee creates, incurs, assumes or permits to exist any debt, except (a) debt
to CNB and (b) trade Debt incurred in the ordinary course of business;

 

10. Lessee sells, leases or otherwise disposes of any of Lessee’s assets or any
Subsidiary’s assets, other than merchandise inventory in the ordinary course of
business;

 

11. Lessee makes loans or advances to any person except credit extended to
employees or to customers in the ordinary course of its business;

 

12. Lessee assumes, guarantees, endorses, contingently agrees to purchase or
otherwise become liable for the obligation of any person including Lessee, a
Subsidiary, or affiliate except (a) by the endorsement of negotiable instruments
for deposit or collection or similar transactions in the ordinary course of
business, and (b) contingent liabilities in favor of CNB;

 

13. Lessee purchases or acquires the obligations or stock of, or any other
interest in, any partnership, joint venture, limited liability company or
corporation, except (a) direct obligations of the United States of America; and
(b) investments in certificates of deposit issued by, and other deposits with,
commercial banks organized under the United States or a State thereof having
capital of at least One Hundred Million Dollars ($100,000,000.00);

 

14. Lessee mortgages, pledges, hypothecates, grants or contracts to grant any
security interest of any kind in any property or assets, to anyone except CNB;

 

15. Lessee permits any involuntary liens to arise with respect to any property
or assets including but not limited to those arising from the levy of a writ of
attachment or execution, or the levy of any state or federal tax lien which lien
will not be removed within a period of thirty (30) days;

 

16. Lessee enters into any merger or consolidation, or acquire all or
substantially all the assets of any person, except a Subsidiary may be merged
into or consolidated with another Subsidiary or with Lessee;

 

17. Lessee permits a default to occur under any document or instrument
evidencing debt incurred under any indenture, agreement or other instrument
under which such debt may be issued, or any event to occur under any of the
foregoing which would permit any holder of the debt outstanding thereunder to
declare the same due and payable before its stated maturity, whether or not such
acceleration occurs or such default be waived.

B. DEFINITIONS.

For purposes of this letter, the following terms have the following meanings:

“Liquid Assets” shall mean the sum of cash, cash equivalents and Marketable
Securities held in the Lessee’s name, including long-term investments managed by
CNB with maturities less than twenty-four (24) months and excluding (i) assets
in any retirement plan (including any profit-sharing plan, self-employed
retirement plan, individual retirement account, annuity, etc.), (ii) any assets
upon which there is any security interest, lien or encumbrance, and (iii) any
securities or accounts which are not readily convertible into cash (such as
restricted stock or hedge funds).

“Marketable Securities” shall mean “margin stock” as defined in Regulation U of
the Federal Reserve Board; bonds and other debt securities of United States
corporations not falling within the definition of “margin stock” with a credit
quality rating of at least A- by Standard & Poors or A-3 by Moody’s; commercial
paper with a credit quality rating of at least A-2 by Standard & Poors or P-2 by
Moody’s; obligations of the United States government or agencies thereof; and
obligations of any state, territory, municipality or other local governmental
subdivision or entity of the United States, with a credit quality rating of at
least A- by Standard & Poor’s or A-3 by Moody’s.

 

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“Prime Rate” means the rate most recently announced by CNB at its principal
office in Beverly Hills, California as its “Prime Rate”. Any change in the
interest rate resulting from a change in the Prime Rate will be effective on the
day on which each change in the Prime Rate is announced by CNB.

“Subsidiary” shall mean any corporation, the majority of whose voting shares are
at any time owned, directly or indirectly by Lessee and/or by one or more
Subsidiaries.

“Tangible Net Worth” means the total of all assets, appearing on a balance sheet
prepared in accordance with generally accepted accounting principles for Lessee
and the Subsidiaries on a consolidated basis, minus (a) all intangible assets,
including, without limitation, unamoritzed debt discount, Affiliate, employee
and officer receivables or advances, goodwill, research and development costs,
patents, trademarks, the excess of purchase price over underlying values of
acquired companies, any covenants not to compete, deferred charges, copyrights,
franchises and appraisal surplus; minus (b) all obligations, which are required
by generally accepted accounting principles to be reflected as a liability on
the consolidated balance sheet of Lessee and the Subsidiaries; minus (c) the
amount, if any, at which shares of stock of a non-wholly owned Subsidiary appear
on the asset side of Lessee’s consolidated balance sheet, as determined in
accordance with generally accepted accounting principles, minus (d) minority
interests; and minus (e) deferred income and reserves not otherwise reflected as
a liability on the consolidated balance sheet of Lessee and the Subsidiaries.

Executed: October 28, 2009

 

CITY NATIONAL BANK

Lessor

   

LOOKSMART, LTD.,

A Delaware Corporation

Lessee

By:   /s/ David W. Maurer     By:   /s/ Edward West Name:   David W. Maurer    
Name:   Edward West Title:   Senior Vice President     Title:   CEO       By:  
/s/ S. C. Markowski       Name:   Stephen C. Markowski       Title:   CFO

 

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