##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended September 30, 2010
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission File Number: 001-34197
 
 LOCAL.COM CORPORATION
  Delaware
(State or other jurisdiction of 
incorporation or organization)
    
    33-0849123
(I.R.S. Employer
Identification Number)
 7555 Irvine Center Drive
Irvine, CA 92618
 (949) 784-0800
 
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company þ(Do not check if a smaller reporting company)
 o þ




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##### 



LOCAL.COM CORPORATION
 Table of Contents
 PagePART I. FINANCIAL INFORMATIONItem 1. Financial StatementsCondensed Consolidated Balance Sheets
As of September 30, 2010 (Unaudited) and December 31, 2009
    
    
    3Condensed Consolidated Statements of Operations
For the three and nine months ended September 30, 2010 and 2009 (Unaudited)
    
    
    4Condensed Consolidated Statements of Cash Flows
For the nine months ended September 30, 2010 and 2009 (Unaudited)
    
    
    5Notes to Condensed Consolidated Financial Statements (Unaudited)
    
    
    6Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    17Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    28Item 4T. Controls and Procedures
    
    
    28PART II. OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    29Item 1A. Risk Factors
    
    
    29Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    30Item 3. Defaults Upon Senior Securities
    
    
    31Item 4. Removed and Reserved
    
    
    31Item 5. Other Information
    
    
    31Item 6. Exhibits
    
    
    32Signatures
    
    
    35Index to Exhibits
    
    
    36EX-10.27EX-10.28EX-10.29EX-31.1EX-31.2EX-32.1
  2




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##### Table of Contents



PART I  FINANCIAL INFORMATION
 
 Item 1. Financial Statements.
 LOCAL.COM CORPORATION
 
 CONDENSED CONSOLIDATED BALANCE SHEETS
  September 30,
    
    
    December 31,2010
    
    
    2009(Unaudited)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    11,887
    
    
    $
    10,080Restricted cash
    
    
    
    
    
    
    35Accounts receivable, net of allowances of
$371 and $205, respectively
    
    
    17,260
    
    
    
    8,792Prepaid expenses and other current assets
    
    
    576
    
    
    
    439Total current assets
    
    
    29,723
    
    
    
    19,346Property and equipment, net
    
    
    6,417
    
    
    
    2,270Goodwill
    
    
    17,339
    
    
    
    13,231Intangible assets, net
    
    
    10,258
    
    
    
    6,406Deposits
    
    
    52
    
    
    
    Total assets
    
    $
    63,789
    
    
    $
    41,253LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    8,829
    
    
    $
    8,891Accrued compensation
    
    
    1,916
    
    
    
    1,112Deferred rent
    
    
    595
    
    
    
    69Warrant liability
    
    
    1,834
    
    
    
    3,727Acquisition consideration payable
    
    
    2,781
    
    
    
    Other accrued liabilities
    
    
    899
    
    
    
    876Revolving line of credit
    
    
    7,000
    
    
    
    3,000Deferred revenue
    
    
    606
    
    
    
    633Total liabilities, all current
    
    
    24,460
    
    
    
    18,308Commitments and contingenciesStockholders equity:Convertible preferred stock, $0.00001 par value;
10,000 shares authorized; none issued and
outstanding for all periods presented
    
    
    
    
    
    
    Common stock, $0.00001 par value; 65,000 shares
authorized; issued and outstanding 16,572 and 14,523,
respectively
    
    
    
    
    
    
    Additional paid-in capital
    
    
    93,239
    
    
    
    81,968Accumulated deficit
    
    
    (53,910
    )
    
    
    (59,023
    )Stockholders equity
    
    
    39,329
    
    
    
    22,945Total liabilities and stockholders equity
    
    $
    63,789
    
    
    $
    41,253
  3




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##### Table of Contents



LOCAL.COM CORPORATION
 
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 
 Three Months Ended September 30,
    
    
    Nine Months Ended September 30,2009
    
    
    
    
    
    
    20092010
    
    
    (As restated)
    
    
    2010
    
    
    (As restated)Revenue
    
    $
    22,457
    
    
    $
    15,128
    
    
    $
    64,092
    
    
    $
    39,918Operating Expenses:Cost of revenues
    
    
    10,705
    
    
    
    8,858
    
    
    
    34,683
    
    
    
    24,116Sales and marketing
    
    
    4,031
    
    
    
    3,080
    
    
    
    11,074
    
    
    
    9,156General and administrative
    
    
    2,663
    
    
    
    1,698
    
    
    
    6,786
    
    
    
    5,676Research and development
    
    
    1,499
    
    
    
    964
    
    
    
    3,753
    
    
    
    2,555Amortization of intangibles
    
    
    1,561
    
    
    
    722
    
    
    
    4,245
    
    
    
    1,801Total operating expenses
    
    
    20,459
    
    
    
    15,322
    
    
    
    60,541
    
    
    
    43,304Operating income (loss)
    
    
    1,998
    
    
    
    (194
    )
    
    
    3,551
    
    
    
    (3,386
    )Interest and other income (expense), net
    
    
    (79
    )
    
    
    (18
    )
    
    
    (196
    )
    
    
    (14
    )Change in fair value of warrant liability
    
    
    1,830
    
    
    
    (1,175
    )
    
    
    1,893
    
    
    
    (2,408
    )Income (loss) before income taxes
    
    
    3,749
    
    
    
    (1,387
    )
    
    
    5,248
    
    
    
    (5,808
    )Provision for income taxes
    
    
    
    
    
    
    
    
    
    
    135
    
    
    
    1Net income (loss)
    
    $
    3,749
    
    
    $
    (1,387
    )
    
    $
    5,113
    
    
    $
    (5,809
    )Per share data:Basic net income (loss) per share
    
    $
    0.23
    
    
    $
    (0.10
    )
    
    $
    0.32
    
    
    $
    (0.40
    )Diluted net income (loss) per share
    
    $
    0.22
    
    
    $
    (0.10
    )
    
    $
    0.31
    
    
    $
    (0.40
    )Basic weighted average shares outstanding
    
    
    16,662
    
    
    
    14,333
    
    
    
    15,760
    
    
    
    14,365Diluted weighted average shares outstanding
    
    
    17,202
    
    
    
    14,333
    
    
    
    16,715
    
    
    
    14,365
  4




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##### Table of Contents



LOCAL.COM CORPORATION
 
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 
 Nine Months Ended Sept 30,20092010
    
    
    (As restated)Cash flows from operating activities:Net income (loss)
    
    $
    5,113
    
    
    $
    (5,809
    )Adjustments to reconcile net income (loss) to cash provided by operating activities:Depreciation and amortization
    
    
    5,081
    
    
    
    2,265Provision for doubtful accounts
    
    
    205
    
    
    
    175Stock-based compensation expense
    
    
    1,990
    
    
    
    1,672Change in fair value of warrant liability
    
    
    (1,893
    )
    
    
    2,408Changes in operating assets and liabilities:Accounts receivable
    
    
    (8,673
    )
    
    
    (3,722
    )Prepaid expenses and other
    
    
    (137
    )
    
    
    (18
    )Other non-current assets
    
    
    (52
    )
    
    
    Accounts payable and accrued liabilities
    
    
    1,257
    
    
    
    3,670Deferred revenue
    
    
    (27
    )
    
    
    28Net cash provided by operating activities
    
    
    2,864
    
    
    
    669Cash flows from investing activities:Capital expenditures
    
    
    (4,983
    )
    
    
    (1,267
    )Decrease in restricted cash
    
    
    35
    
    
    
    31Acquisition, net of cash acquired
    
    
    (3,825
    )
    
    
    Purchases of intangible assets
    
    
    (3,887
    )
    
    
    (4,252
    )Net cash used in investing activities
    
    
    (12,660
    )
    
    
    (5,488
    )Cash flows from financing activities:Proceeds from issuance of common stock:Exercise of warrants
    
    
    6,974
    
    
    
    Exercise of options
    
    
    1,878
    
    
    
    167Repurchases of common stock
    
    
    (1,221
    )
    
    
    (336
    )Payment of expiring revolving credit facility
    
    
    (3,000
    )
    
    
    Proceeds from new revolving credit facility
    
    
    7,000
    
    
    
    Payment of financing related costs
    
    
    (28
    )
    
    
    (1
    )Net cash provided by (used in) financing activities
    
    
    11,603
    
    
    
    (170
    )Net increase (decrease) in cash and cash equivalents
    
    
    1,807
    
    
    
    (4,989
    )Cash and cash equivalents, beginning of year
    
    
    10,080
    
    
    
    12,142Cash and cash equivalents, end of year
    
    $
    11,887
    
    
    $
    7,153Supplemental cash flow information:Interest paid
    
    $
    381
    
    
    $
    24Income taxes paid
    
    $
    206
    
    
    $
    1
  5




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##### Table of Contents



LOCAL.COM CORPORATION
 
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 1. The Company and Summary of Significant Accounting Policies
 Nature of operations
  Principles of consolidation and basis of presentation
     Use of estimates
  Fair Value of Financial Instruments
  6




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##### Table of Contents



Revenue Recognition
    Intangible Assets
  2. Purchases of customer-related intangible assets
    7




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##### Table of Contents



3. Acquisition
 Simply Static, LLC Asset Purchase
   
    
    targeting and registration of geo-category based local website domains;
    
    small business and geo-category website creation, hosting and management;
    
    an ad exchange to manage the selection and deployment of ad inventory across all
Octane-controlled domains and websites; and
    
    a content marketplace to allow for the management of geo-category content written for
advertising customers or our directly owned portfolio properties.
  Cash consideration
    
    $
    3,825Stock consideration (248,559 shares of common stock)
    
    
    1,679Earnout payable
    
    
    1,950Total
    
    $
    7,454
  8




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##### Table of Contents



Developed technology
    
    $
    1,700Domain names
    
    
    900Trademark and tradenames
    
    
    500Customer-related intangibles
    
    
    210Non-compete agreement
    
    
    70Goodwill
    
    
    4,108Liabilities assumed
    
    
    (34
    )Total
    
    $
    7,454
   4. Intangible assets
  September 30, 2010
    
    
    December 31, 2009Gross
    
    
    
    
    
    
    Net
    
    
    Weighted
    
    
    Gross
    
    
    
    
    
    
    Net
    
    
    WeightedCarrying
    
    
    Accumulated
    
    
    Carrying
    
    
    Average
    
    
    Carrying
    
    
    Accumulated
    
    
    Carrying
    
    
    AverageAmount
    
    
    Amortization
    
    
    Amount
    
    
    Useful Life
    
    
    Amount
    
    
    Amortization
    
    
    Amount
    
    
    Useful Life(years)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (years)Developed technology
    
    $
    3,933
    
    
    $
    (2,339
    )
    
    $
    1,594
    
    
    
    5
    
    
    $
    2,233
    
    
    $
    (2,159
    )
    
    $
    74
    
    
    
    5Customer-related
    
    
    12,719
    
    
    
    (6,189
    )
    
    
    6,530
    
    
    
    5
    
    
    
    7,792
    
    
    
    (2,226
    )
    
    
    5,566
    
    
    
    5Patents
    
    
    431
    
    
    
    (431
    )
    
    
    
    
    
    
    3
    
    
    
    431
    
    
    
    (366
    )
    
    
    65
    
    
    
    3Trademarks and trade name
    
    
    500
    
    
    
    (31
    )
    
    
    469
    
    
    
    4
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Non-compete agreements
    
    
    83
    
    
    
    (19
    )
    
    
    64
    
    
    
    3
    
    
    
    13
    
    
    
    (13
    )
    
    
    
    
    
    
    2Domain names  indefinite life
    
    
    1,601
    
    
    
    
    
    
    
    1,601
    
    
    
    
    
    
    
    701
    
    
    
    
    
    
    
    701$
    19,267
    
    
    $
    (9,009
    )
    
    $
    10,258
    
    
    
    
    
    
    $
    11,170
    
    
    $
    (4,764
    )
    
    $
    6,406
 5. Goodwill and Other Intangible Assets
  9




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##### Table of Contents



6. Website development costs and computer software developed for internal use
   Three Months Ended September 30,
    
    
    Nine Months Ended September 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Additional capitalized website development costs
    
    $
    1,297
    
    
    $
    413
    
    
    $
    2,246
    
    
    $
    540Amortization of capitalized website development costs
    
    $
    (141
    )
    
    $
    (88
    )
    
    $
    (370
    )
    
    $
    (148
    )
 7. Net income (loss) per share
   Three Months Ended September 30,
    
    
    Nine Months Ended September 30,2009
    
    
    
    
    
    
    20092010
    
    
    (As restated)
    
    
    2010
    
    
    (As restated)Numerator:Net income (loss)
    
    $
    3,749
    
    
    $
    (1,387
    )
    
    $
    5,113
    
    
    $
    (5,809
    )Denominator:Denominator for historical basic calculation weighted average shares
    
    
    16,662
    
    
    
    14,333
    
    
    
    15,760
    
    
    
    14,365Dilutive common stock equivalents:*Options
    
    
    533
    
    
    
    
    
    
    
    907
    
    
    
    Warrants
    
    
    7
    
    
    
    
    
    
    
    48
    
    
    
    Denominator for historical diluted calculation weighted average shares
    
    
    17,202
    
    
    
    14,333
    
    
    
    16,715
    
    
    
    14,365Net income (loss) per share:Historical basic net income (loss) per share
    
    $
    0.23
    
    
    $
    (0.10
    )
    
    $
    0.32
    
    
    $
    (0.40
    )Historical diluted net income (loss) per share
    
    $
    0.22
    
    
    $
    (0.10
    )
    
    $
    0.31
    
    
    $
    (0.40
    )
 
 *
    
    For the three and nine months ended September 30, 2009, potentially dilutive
securities, which consist of options to purchase 3,997,927 shares of common stock at prices
ranging from $1.28 to $16.59 per share and warrants to purchase 3,339,745 shares of common
stock at prices ranging from $2.31 to $25.53 per share were not included in the computation
of diluted net income per share because such inclusion would be antidilutive. 8. Composition of certain balance sheet and statement of operations captions
  September 30,
    
    
    December 31,2010
    
    
    2009Furniture and fixtures
    
    $
    760
    
    
    $
    228Office equipment
    
    
    453
    
    
    
    139Computer equipment
    
    
    2,912
    
    
    
    2,026Computer software
    
    
    5,399
    
    
    
    3,023Leasehold improvements
    
    
    1,458
    
    
    
    58510,982
    
    
    
    6,001Less accumulated depreciation and amortization
    
    
    (4,565
    )
    
    
    (3,731
    )Property and equipment, net
    
    $
    6,417
    
    
    $
    2,270
 10




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Three Months Ended September 30,
    
    
    Nine Months Ended September 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Interest income
    
    $
    2
    
    
    $
    2
    
    
    $
    14
    
    
    $
    10Interest expense
    
    
    (81
    )
    
    
    (20
    )
    
    
    (210
    )
    
    
    (24
    )Interest and other income (expense), net
    
    $
    (79
    )
    
    $
    (18
    )
    
    $
    (196
    )
    
    $
    (14
    )
 9. Credit facilities
         11




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##### Table of Contents



10. Operating information
  Three Months Ended September 30,
    
    
    Nine Months Ended September 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Revenue by geographic region:United States
    
    $
    22,457
    
    
    $
    15,128
    
    
    $
    64,092
    
    
    $
    39,786Europe
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    132Total revenue
    
    $
    22,457
    
    
    $
    15,128
    
    
    $
    64,092
    
    
    $
    39,918Revenue by product:Pay-Per-Click (PPC)
    
    $
    14,102
    
    
    $
    12,230
    
    
    $
    46,500
    
    
    $
    32,242Local Promote (Subscription)
    
    
    1,642
    
    
    
    1,823
    
    
    
    5,097
    
    
    
    5,035Domain Sales and Services
    
    
    5,208
    
    
    
    198
    
    
    
    8,433
    
    
    
    602Banner Advertisement
    
    
    1,499
    
    
    
    864
    
    
    
    4,036
    
    
    
    1,988Local Connect (License)
    
    
    6
    
    
    
    13
    
    
    
    26
    
    
    
    51Total revenue
    
    $
    22,457
    
    
    $
    15,128
    
    
    $
    64,092
    
    
    $
    39,918
 11. Stock-based compensation
  Weighted
    
    
    AggregateAverage
    
    
    Intrinsic ValueShares
    
    
    Exercise Price
    
    
    (in thousands)Outstanding at December 31, 2009
    
    
    3,998,790
    
    
    $
    4.33Granted
    
    
    427,850
    
    
    
    6.78Exercised
    
    
    (589,945
    )
    
    
    3.47Cancelled
    
    
    (260,950
    )
    
    
    5.20Outstanding at September 30, 2010
    
    
    3,575,745
    
    
    $
    4.70
    
    
    $
    2,544Exercisable at September 30, 2010
    
    
    1,754,821
    
    
    $
    5.13
    
    
    $
    1,021
   12




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##### Table of Contents



Options OutstandingWeighted
    
    
    
    
    
    
    Options ExercisableAverage
    
    
    Weighted
    
    
    
    
    
    
    WeightedRemaining
    
    
    Average
    
    
    
    
    
    
    AverageContractual
    
    
    Exercise
    
    
    
    
    
    
    ExerciseRange of Exercise Prices
    
    Shares
    
    
    Life
    
    
    Price
    
    
    Shares
    
    
    Price$0.00 - $2.00
    
    
    609,220
    
    
    8.3 years
    
    $
    1.58
    
    
    
    227,731
    
    
    $
    1.55$2.01 - $3.00
    
    
    109,262
    
    
    8.0 years
    
    
    2.33
    
    
    
    34,176
    
    
    
    2.33$3.01 - $4.00
    
    
    668,476
    
    
    6.2 years
    
    
    3.65
    
    
    
    399,406
    
    
    
    3.76$4.01 - $5.00
    
    
    1,146,462
    
    
    7.1 years
    
    
    4.56
    
    
    
    588,437
    
    
    
    4.61$5.01 - $6.00
    
    
    269,683
    
    
    7.8 years
    
    
    5.57
    
    
    
    89,830
    
    
    
    5.80$6.01 - $7.00
    
    
    261,604
    
    
    8.4 years
    
    
    6.52
    
    
    
    71,953
    
    
    
    6.51$7.01 - $8.00
    
    
    221,862
    
    
    5.6 years
    
    
    7.49
    
    
    
    190,112
    
    
    
    7.51$8.01 - $9.00
    
    
    191,000
    
    
    8.2 years
    
    
    8.51
    
    
    
    55,000
    
    
    
    8.98$9.01 - $10.00
    
    
    15,000
    
    
    4.7 years
    
    
    9.90
    
    
    
    15,000
    
    
    
    9.90$10.01 - $16.59
    
    
    83,176
    
    
    3.7 years
    
    
    15.62
    
    
    
    83,176
    
    
    
    15.623,575,745
    
    
    7.2 years
    
    $
    4.70
    
    
    
    1,754,821
    
    
    $
    5.13
  Three Months Ended September 30,
    
    
    Nine Months Ended September 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Risk-free interest rate
    
    
    1.66
    %
    
    
    3.34
    %
    
    
    2.30
    %
    
    
    2.68
    %Expected lives (in years)
    
    5.4 years
    
    
    7.0 years
    
    
    5.7 years
    
    
    7.0 yearsExpected dividend yield
    
    None
    
    
    None
    
    
    None
    
    
    NoneExpected volatility
    
    
    92.63
    %
    
    
    100.00
    %
    
    
    94.02
    %
    
    
    100.00
    %
  Three Months Ended September 30,
    
    
    Nine Months Ended September 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Cost of revenues
    
    $
    78
    
    
    $
    7
    
    
    $
    163
    
    
    $
    17Sales and marketing
    
    
    243
    
    
    
    144
    
    
    
    562
    
    
    
    502General and administrative
    
    
    260
    
    
    
    376
    
    
    
    845
    
    
    
    907Research and development
    
    
    125
    
    
    
    110
    
    
    
    420
    
    
    
    246Total stock-based compensation expense
    
    $
    706
    
    
    $
    637
    
    
    $
    1,990
    
    
    $
    1,672Basic and diluted net stock-based compensation expense per share
    
    $
    0.04
    
    
    $
    0.04
    
    
    $
    0.12
    
    
    $
    0.12
 12. Stock repurchase program
  13




---



##### Table of Contents



13. Warrants
  WeightedAverageShares
    
    
    Exercise PriceOutstanding at December 31, 2009
    
    
    2,859,595
    
    
    $
    6.16Issued
    
    
    
    
    
    
    Exercised
    
    
    (1,525,573
    )
    
    
    4.65Expired
    
    
    
    
    
    
    Outstanding at September 30, 2010
    
    
    1,334,022
    
    
    $
    7.88Exercisable at September 30, 2010
    
    
    1,334,022
    
    
    $
    7.88
  Warrants Outstanding and ExercisableAverageRemaining
    
    
    WeightedContractual
    
    
    AverageRange of Exercise Price
    
    Shares
    
    
    Life
    
    
    Exercise Price$4.00 - $4.99
    
    
    129,638
    
    
    1.4 years
    
    $
    4.60$5.00 - $5.99
    
    
    129,638
    
    
    1.4 years
    
    
    5.41$7.00 - $7.99
    
    
    537,373
    
    
    2.3 years
    
    
    7.89$9.00 - $9.99
    
    
    537,373
    
    
    3.3 years
    
    
    9.261,334,022
    
    
    2.6 years
    
    $
    7.88
 14. Fair Value Measurement of Assets and Liabilities
  Quoted Prices inAs of
    
    
    Active Markets
    
    
    SignificantSeptember 30,
    
    
    for Identical
    
    
    UnobservableDescription
    
    2010
    
    
    Assets (Level 1)
    
    
    Inputs (Level 3)Assets:Cash and cash equivalents:Bank deposits and money market funds
    
    $
    11,887
    
    
    $
    11,887
    
    
    $
    Total financial assets
    
    $
    11,887
    
    
    $
    11,887
    
    
    $
    Liabilities:Warrant liability
    
    $
    1,834
    
    
    $
    
    
    
    $
    1,834
 14




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##### Table of Contents



Quoted Prices inAs of
    
    
    Active Markets
    
    
    SignificantDecember 31,
    
    
    for Identical
    
    
    UnobservableDescription
    
    2009
    
    
    Assets (Level 1)
    
    
    Inputs (Level 3)Assets:Cash and cash equivalents:Bank deposits and money market funds
    
    $
    10,080
    
    
    $
    10,080
    
    
    $
    Restricted cash
    
    
    35
    
    
    
    35
    
    
    
    Total financial assets
    
    $
    10,115
    
    
    $
    10,115
    
    
    $
    Liabilities:Warrant liability
    
    $
    3,727
    
    
    $
    
    
    
    $
    3,727
   Exercise Price of Related Warrants$9.26
    
    
    $7.89Risk-free interest rate
    
    
    0.74
    %
    
    
    0.50
    %Expected lives (in years)
    
    3.3 years
    
    2.3 yearsExpected dividend yield
    
    None
    
    NoneExpected volatility
    
    
    92.50
    %
    
    
    81.53
    %
  Level 3Balance at December 31, 2009
    
    $
    3,727Change in fair value of warrant liability
    
    
    (1,893
    )Balance at September 30, 2010
    
    $
    1,834
  15




---



##### Table of Contents



15. Restatement
 Derivatives and Hedging
  16




---



##### Table of Contents



Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
 This Quarterly Report on Form 10-Q or certain information included or incorporated by reference in
this report, contains or may contain forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact,
are statements that could be deemed forward-looking statements within the meaning of the federal
securities laws. These statements relate to our future operations, prospects, potential products,
services, developments and business strategies. These statements can, in some cases, be identified
by the use of terms such as may, will, should, could, would, expect, plan,
anticipate, believe, estimate, predict, project, and potential or the negative of such
terms or other comparable terminology. In addition, important factors to consider in evaluating
such forward-looking statements include changes or developments in social, economic, market, legal
or regulatory circumstances, changes in our business or growth strategy or an inability to execute
our strategy due to changes in our industry or the economy generally, the emergence of new or
growing competitors, the actions or omissions of third parties, including customers, competitors
and governmental authorities, and various other factors, including those described or referred to
in Item 1A of Part II of this Quarterly Report. Should any one or more of these risks or
uncertainties materialize, or the underlying estimates or assumptions prove incorrect, our actual
results could differ materially from those expressed in the forward-looking statements and there
can be no assurance that the forward-looking statements contained in this report will in fact
occur.
 The following discussion and analysis of our financial condition and results of operations should
be read in conjunction with the attached condensed consolidated financial statements and related
notes thereto, and with the audited consolidated financial statements and related notes thereto as
of December 31, 2009 and for the year ended December 31, 2009 included in our Annual Report on Form
10-K filed with the Securities and Exchange Commission on March 16, 2010.
 Overview
      17




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##### Table of Contents



Recent Developments
       18




---



##### Table of Contents



Outlook for Our Business
       Sources of Revenue
  
    
    click-throughs on sponsored listings;
    
    calls to cost-per-call advertiser listings;
    
    lead generation;
    
    banner ads;
    
    subscription advertiser listings;
    
    domain sales and services; and
    
    web hosting services.
 19




---



##### Table of Contents



Operating Expenses
 Cost of Revenues
  Sales and Marketing
  General and Administrative
  Research and Development
  Critical Accounting Policies
  Revenue Recognition
   20




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##### Table of Contents



Allowance for Doubtful Accounts
   Goodwill and Other Intangible Assets
  Stock Based Compensation
  Three Months Ended September 30,
    
    
    Nine Months Ended September 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Cost of revenues
    
    $
    78
    
    
    $
    7
    
    
    $
    163
    
    
    $
    17Sales and marketing
    
    
    243
    
    
    
    144
    
    
    
    562
    
    
    
    502General and administrative
    
    
    260
    
    
    
    376
    
    
    
    845
    
    
    
    907Research and development
    
    
    125
    
    
    
    110
    
    
    
    420
    
    
    
    246Total stock-based compensation expense
    
    $
    706
    
    
    $
    637
    
    
    $
    1,990
    
    
    $
    1,672Basic and diluted net stock-based compensation expense per share
    
    $
    0.04
    
    
    $
    0.04
    
    
    $
    0.12
    
    
    $
    0.12
 21




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##### Table of Contents



Results of Operations
  Three Months Ended September 30,
    
    
    Nine Months Ended September 30,2009
    
    
    
    
    
    
    20092010
    
    
    (As restated)
    
    
    2010
    
    
    (As restated)Revenue
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %Operating expenses:Cost of revenues
    
    
    47.7
    
    
    
    58.6
    
    
    
    54.1
    
    
    
    60.4Sales and marketing
    
    
    17.9
    
    
    
    20.4
    
    
    
    17.3
    
    
    
    22.9General and administrative
    
    
    11.9
    
    
    
    11.2
    
    
    
    10.6
    
    
    
    14.2Research and development
    
    
    6.7
    
    
    
    6.4
    
    
    
    5.9
    
    
    
    6.4Amortization of intangibles
    
    
    7.0
    
    
    
    4.8
    
    
    
    6.6
    
    
    
    4.5Total operating expenses
    
    
    91.1
    
    
    
    101.3
    
    
    
    94.5
    
    
    
    108.5Operating income (loss)
    
    
    8.9
    
    
    
    (1.3
    )
    
    
    5.5
    
    
    
    (8.5
    )Interest and other income (expense), net
    
    
    (0.4
    )
    
    
    (0.1
    )
    
    
    (0.3
    )
    
    
    (0.0
    )Change in fair value of warrant liability
    
    
    8.2
    
    
    
    (7.8
    )
    
    
    3.0
    
    
    
    (6.0
    )Income (loss) before income taxes
    
    
    16.7
    
    
    
    (9.2
    )
    
    
    8.2
    
    
    
    (14.5
    )Provision for income taxes
    
    
    
    
    
    
    
    
    
    
    0.2
    
    
    
    0.0Net income (loss)
    
    
    16.7
    %
    
    
    (9.2
    )%
    
    
    8.0
    %
    
    
    (14.5
    )%
 Three and nine months ended September 30, 2010 and 2009
 Revenue (dollars in thousands):
 Three Months Ended September 30,
    
    
    Percent
    
    
    Nine Months Ended September 30,
    
    
    Percent2010
    
    
    (*)
    
    
    2009
    
    
    (*)
    
    
    change
    
    
    2010
    
    
    (*)
    
    
    2009
    
    
    (*)
    
    
    changeOwned and operated
    
    $
    11,576
    
    
    
    51.5
    %
    
    $
    9,953
    
    
    
    65.8
    %
    
    
    16.3
    %
    
    $
    34,365
    
    
    
    53.6
    %
    
    $
    27,285
    
    
    
    68.4
    %
    
    
    25.9
    %Network
    
    
    6,818
    
    
    
    30.4
    %
    
    
    3,158
    
    
    
    20.9
    %
    
    
    115.9
    %
    
    
    18,987
    
    
    
    29.6
    %
    
    
    7,017
    
    
    
    17.6
    %
    
    
    170.6
    %Sales and advertiser services
    
    
    4,063
    
    
    
    18.1
    %
    
    
    2,017
    
    
    
    13.3
    %
    
    
    101.4
    %
    
    
    10,740
    
    
    
    16.8
    %
    
    
    5,616
    
    
    
    14.1
    %
    
    
    91.2
    %Total revenue
    
    $
    22,457
    
    
    
    100.0
    %
    
    $
    15,128
    
    
    
    100.0
    %
    
    
    48.4
    %
    
    $
    64,092
    
    
    
    100.0
    %
    
    $
    39,918
    
    
    
    100.0
    %
    
    
    60.6
    %
 
      22




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##### Table of Contents



Three Months Ended September 30,
    
    
    Percent
    
    
    Nine Months Ended September 30,
    
    
    Percent2010
    
    
    (*)
    
    
    2009
    
    
    (*)
    
    
    change
    
    
    2010
    
    
    (*)
    
    
    2009
    
    
    (*)
    
    
    changeRevenue from internal
and outsourced sales
    
    $
    1,303
    
    
    
    32.1
    %
    
    $
    866
    
    
    
    42.9
    %
    
    
    50.4
    %
    
    $
    3,499
    
    
    
    32.6
    %
    
    $
    2,369
    
    
    
    42.2
    %
    
    
    47.7
    %Revenue from acquired bases
    
    
    2,760
    
    
    
    67.9
    %
    
    
    1,151
    
    
    
    57.1
    %
    
    
    139.8
    %
    
    
    7,241
    
    
    
    67.4
    %
    
    
    3,247
    
    
    
    57.8
    %
    
    
    123.0
    %Total sales and advertiser
services revenue
    
    $
    4,063
    
    
    
    100.0
    %
    
    $
    2,017
    
    
    
    100.0
    %
    
    
    101.4
    %
    
    $
    10,740
    
    
    
    100.0
    %
    
    $
    5,616
    
    
    
    100.0
    %
    
    
    91.2
    %
 
 (*)
    
    - Percent of sales and advertiser services revenue      Percentage of Total Revenue
    
    
    Percentage of Total RevenueThree Months Ended September 30,
    
    
    Nine Months Ended September 30,Customer
    
    2010
    
    
    2009
    
    
    2010
    
    
    2009Yahoo! Inc.
    
    
    36.3
    %
    
    
    41.7
    %
    
    
    45.5
    %
    
    
    44.8
    %SuperMedia Inc.
    
    
    30.4
    %
    
    
    22.0
    %
    
    
    23.1
    %
    
    
    21.6
    %
 Operating expenses:
  Three Months Ended September 30,
    
    
    
    
    
    
    Nine Months Ended September 30,Percent of
    
    
    
    
    
    
    Percent of
    
    
    
    
    
    
    
    
    
    
    Percent of
    
    
    
    
    
    
    Percent ofTotal
    
    
    
    
    
    
    Total
    
    
    Percent
    
    
    
    
    
    
    Total
    
    
    
    
    
    
    Total
    
    
    Percent2010
    
    
    Revenue
    
    
    2009
    
    
    Revenue
    
    
    Change
    
    
    2010
    
    
    Revenue
    
    
    2009
    
    
    Revenue
    
    
    ChangeCost of revenues
    
    $
    10,705
    
    
    
    47.7
    %
    
    $
    8,858
    
    
    
    58.6
    %
    
    
    20.9
    %
    
    $
    34,683
    
    
    
    54.1
    %
    
    $
    24,116
    
    
    
    60.4
    %
    
    
    43.8
    %Sales and marketing
    
    
    4,031
    
    
    
    17.9
    %
    
    
    3,080
    
    
    
    20.4
    %
    
    
    30.9
    %
    
    
    11,074
    
    
    
    17.3
    %
    
    
    9,156
    
    
    
    22.9
    %
    
    
    20.9
    %General and administrative
    
    
    2,663
    
    
    
    11.9
    %
    
    
    1,698
    
    
    
    11.2
    %
    
    
    56.8
    %
    
    
    6,786
    
    
    
    10.6
    %
    
    
    5,676
    
    
    
    14.2
    %
    
    
    19.6
    %Research and development
    
    
    1,499
    
    
    
    6.7
    %
    
    
    964
    
    
    
    6.4
    %
    
    
    55.5
    %
    
    
    3,753
    
    
    
    5.9
    %
    
    
    2,555
    
    
    
    6.4
    %
    
    
    46.9
    %Amortization of intangibles
    
    
    1,561
    
    
    
    7.0
    %
    
    
    722
    
    
    
    4.8
    %
    
    
    116.2
    %
    
    
    4,245
    
    
    
    6.6
    %
    
    
    1,801
    
    
    
    4.5
    %
    
    
    135.7
    %Total operating expenses
    
    $
    20,459
    
    
    
    91.1
    %
    
    $
    15,322
    
    
    
    101.3
    %
    
    
    33.5
    %
    
    $
    60,541
    
    
    
    94.5
    %
    
    $
    43,304
    
    
    
    108.5
    %
    
    
    39.8
    %
 Cost of revenues
  23




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##### Table of Contents



Sales and marketing
  General and administrative
  Research and development
   Three Months Ended June 30,
    
    
    Nine Months Ended September 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Research and development expense
    
    $
    1,499
    
    
    $
    964
    
    
    $
    3,753
    
    
    $
    2,555Capitalized website development costs
    
    $
    1,297
    
    
    $
    413
    
    
    $
    2,246
    
    
    $
    540Amortization of capitalized website development costs
    
    $
    (141
    )
    
    $
    (88
    )
    
    $
    (370
    )
    
    $
    (148
    )
 Amortization of intangibles
  Interest and other income (expense), net
  Provision for income taxes
  24




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##### Table of Contents



Liquidity and Capital Resources
  September 30,
    
    
    December 31,2010
    
    
    2009Cash and cash equivalents
    
    $
    11,887
    
    
    $
    10,080Working capital
    
    $
    7,097
    
    
    $
    4,765
  Nine Months Ended September 30,2010
    
    
    2009Net cash provided by operating activities
    
    $
    2,864
    
    
    $
    669Net cash used in investing activities
    
    
    (12,660
    )
    
    
    (5,488
    )Net cash provided by (used in) financing activities
    
    
    11,603
    
    
    
    (170
    )
      Nine Months Ended September 30,20092010
    
    
    (As restated)
    
    
    ChangeNet income (loss)
    
    $
    5,113
    
    
    $
    (5,809
    )
    
    $
    10,922Non-cash (1)
    
    
    5,383
    
    
    
    6,520
    
    
    
    (1,137
    )Subtotal
    
    
    10,496
    
    
    
    711
    
    
    
    9,785AR, AP and Other
    
    
    (7,632
    )
    
    
    (42
    )
    
    
    (7,590
    )Net cash provided by operations
    
    $
    2,864
    
    
    $
    669
    
    
    $
    2,195
 
 (1)
    
    Includes depreciation, amortization, change in fair value of warrant liability, non-cash
expense related to stock-based compensation and provision for doubtful accounts. 25




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##### Table of Contents



Credit facility
          26




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##### Table of Contents



Shelf Registration Statement
  Stock repurchase program
  Off-Balance Sheet Arrangements
  27




---



##### Table of Contents



Item 3. Quantitative and Qualitative Disclosures About Market Risk
  
 Item 4T. Controls and Procedures
 Evaluation of Disclosure Controls and Procedures
        Changes in Internal Control over Financial Reporting
  28




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##### Table of Contents



PART II. OTHER INFORMATION
 
 Item 1. Legal Proceedings
  GEOTAG Litigation
  
 Item 1A. Risk Factors
  If we are not successful in defending against the patent infringement lawsuit filed against us, our
operations could be materially adversely affected.
  Recent changes to our Local.com website could have a material adverse effect on our financial
results.
  Recent changes to the Yahoo! search and advertising platform could have a material and adverse
effect on our financial results.
  Our announced suspension of LEC-billed subscriber bases is expected to result in a decline in
revenue and earnings.
  29




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##### Table of Contents



Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
         ApproximateTotal Number of
    
    
    Dollar Value ofShares Purchased
    
    
    Shares that Mayas Part of a
    
    
    Yet be PurchasedTotal Number
    
    
    Average
    
    
    Publicly
    
    
    Under theof Shares
    
    
    Price Paid
    
    
    Announced
    
    
    ProgramsPurchased (1)
    
    
    per Share
    
    
    Program
    
    
    (in 000s) (1)January 1  January 31, 2010
    
    
    
    
    
    $
    
    
    
    
    February 1  February 28, 2010
    
    
    
    
    
    $
    
    
    
    
    March 1  March 31, 2010
    
    
    
    
    
    $
    
    
    
    
    April 1  April 30, 2010
    
    
    
    
    
    $
    
    
    
    
    May 1  May 31, 2010
    
    
    
    
    
    $
    
    
    
    
    June 1  June 30, 2010
    
    
    
    
    
    $
    
    
    
    
    July 1  July 31, 2010
    
    
    
    
    
    $
    
    
    
    
    August 1  August 31, 2010
    
    
    270,400
    
    
    $
    4.52
    
    
    
    270,400
    
    
    $
    779September 1  September 30, 2010
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    779Total
    
    
    270,400
    
    
    $
    4.52
    
    
    
    270,400
 
 (1)
    
    The shares repurchased in the nine months ended September 30, 2010 were under our stock
repurchase program that was approved in August 2010 with an authorized level of $2.0 million.
The shares repurchased were retired. This program will expire in April 2011. 30




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##### Table of Contents



Item 3. Defaults Upon Senior Securities
  
 Item 4. Removed and Reserved
 
 Item 5. Other Information
  31




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##### Table of Contents



Item 6. Exhibits
 ExhibitNumber
    
    Description3.1 (1)
    
    Amended and Restated Certificate of Incorporation of the Registrant3.2 (2)
    
    Amendment to Restated Certificate of Incorporation of the Registrant3.2 (3)
    
    Amended and Restated Bylaws of the Registrant3.3 (4)
    
    Certificate of Ownership and Merger of Interchange Merger Sub, Inc. with and into Interchange
Corporation3.4 (5)
    
    Certificate of Designation of Rights, Preferences and Privileges of Series A Participating
Preferred Stock of Local.com Corporation.4.1 (5)
    
    Preferred Stock Rights Agreement, dated as of October 15, 2008, by and between Local.com
Corporation and Computershare Trust Company, N.A., as Rights Agent (which includes the form of
Certificate of Designation of Rights, Preferences and Privileges of Series A Participating
Preferred Stock of Local.com Corporation as Exhibit A thereto, the form of Rights Certificate
as Exhibit B thereto, and the Stockholder Rights Plan, Summary of Rights as Exhibit C
thereto).10.1 (6)#
    
    Description of the Material Terms of the Companys Bonus Program as of January 27, 2010.10.2 (7)
    
    Second Amendment dated February 5, 2010 to Loan and Security Agreement dated June 26, 2009, by
and among Registrant, Local.com PG Acquisition Corporation, and Square 1 Bank.10.3 (8)
    
    Asset Purchase Agreement by and among the Registrant and LaRoss Partners, LLC dated February
12, 2010.10.4 (9)
    
    SuperMedia Superpages Advertising Distribution Agreement effective April 1, 2010 by and among
the Registrant and SuperMedia LLC.10.5 (10)
    
    Asset Purchase Agreement by and among the Registrant and Turner Consulting Group, LLC dated
April 20, 2010.10.6 (11)
    
    First Amendment to Lease by and among the Registrant and The Irvine Company LLC dated April
21, 2010.10.7 (11)
    
    Second Amendment to Lease by and among the Registrant and The Irvine Company LLC dated April
21, 2010.10.8 (11)#
    
    Description of the Material Terms of the Registrants Bonus Program as of April 23, 2010.10.9 (11)#
    
    Second Amended and Restated Employment Agreement by and between the Registrant and Heath
Clarke dated April 26, 2010.10.10 (11)#
    
    Second Amended and Restated Employment Agreement by and between the Registrant and Stanley B.
Crair dated April 26, 2010.10.11 (11)#
    
    Amended and Restated Employment Agreement by and between the Registrant and Brenda Agius dated
April 26, 2010.10.12 (11)#
    
    Amended and Restated Employment Agreement by and between the Registrant and Michael Plonski
dated April 26, 2010.10.13 (12)
    
    Asset Purchase Agreement by and among the Registrant and LaRoss Partners, LLC dated May 28,
2010.10.14 (13)
    
    Third Amendment dated June 9, 2010 to Loan and Security Agreement dated June 26, 2009, by and
among Registrant and Square 1 Bank.10.15 (14)
    
    Amendment No. 7 to Yahoo! Publisher Network Agreement dated June 8, 2010 by and among the
Registrant and Yahoo! Inc.10.16 (15)
    
    Loan and Security Agreement dated June 28, 2010, by and between Registrant and Silicon Valley
Bank.10.17 (16)
    
    Asset Purchase Agreement by and among the Registrant and Simply Static, LLC dated July 1, 2010.10.18 (17)
    
    Sales and Services Agreement dated July 16, 2010 by and among the Registrant and LaRoss
Partners, LLC.10.19 (18)
    
    Amendment dated August 5, 2010 to Loan and Security Agreement dated June 28, 2010, by and
among Registrant and Silicon Valley Bank.10.20 (19)
    
    Yahoo! Publisher Network Contract dated August 25, 2010 by and among the Registrant and Yahoo!
Inc.10.21 (20)
    
    Amendment Number 1 to Yahoo! Publisher Network Contract dated August 30, 2010 by and among the
Registrant and Yahoo! Inc.10.22 (21)+
    
    Amendment No. 1 to SuperMedia Superpages Advertising Distribution Agreement dated September
30, 2010 by and between the Registrant and SuperMedia LLC.10.23 (21)+
    
    Domain Purchase and Development Agreement dated September 30, 2010 by and between the
Registrant and SuperMedia LLC.10.24 (21)
    
    Asset Purchase Agreement dated September 30, 2010 by and between Registrant and Best Click
Advertising.com, LLC.10.25 (22)#
    
    Third Amended and Restated Employment Agreement by and between the Registrant and Kenneth
Cragun dated October 18, 2010.
 32




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##### Table of Contents



ExhibitNumber
    
    Description10.26 (22)#
    
    Separation and General Release Agreement by and among the Registrant and Brenda Agius dated
October 18, 2010.10.27*#
    
    Amended and Restated Employment Agreement by and between the Registrant and Scott Reinke dated
April 26, 2010.10.28*
    
    Microsoft adCenter Terms and Conditions10.29*
    
    Yahoo! Advertising Terms and Conditions31.1*
    
    Certification of Principal Executive Officer Required by Rule 13a-14(a) of the Securities
Exchange Act of 1934, as amended, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act
of 2002.31.2*
    
    Certification of Principal Financial Officer Required by Rule 13a-14(a) of the Securities
Exchange Act of 1934, as amended, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act
of 2002.32.1*
    
    Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C.
Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 
 *
    
    Filed herewith.#
    
    Indicates management contract or compensatory plan.+
    
    Application has been made with the Securities and Exchange Commission
to seek confidential treatment of certain provisions. Omitted
material for which confidential treatment has been requested has been
filed separately with the Securities and Exchange Commission.(1)
    
    Incorporated by reference from the Registrants Statement on Form
SB-2, Amendment No. 2, filed with the Securities and Exchange
Commission on September 16, 2004.(2)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on August
17, 2009(3)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on
November 2, 2007.(4)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K/A, filed with the Securities and Exchange Commission on
November 2, 2006.(5)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on
October 15, 2008.(6)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on
February 1, 2010.(7)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on
February 9, 2010.(8)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on
February 16, 2010.(9)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on April
2, 2010.(10)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on April
22, 2010.(11)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on April
27, 2010.(12)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on June
1, 2010.(13)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on June
11, 2010.(14)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on June
11, 2010.(15)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on July
1, 2010.(16)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on July
8, 2010. 33




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##### Table of Contents



(17)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on July
22, 2010.(18)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on August
6, 2010.(19)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on August
31, 2010.(20)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on
September 3, 2010.(21)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on
October 6, 2010.(22)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on
October 19, 2010. 34




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##### Table of Contents



SIGNATURES
  LOCAL.COM CORPORATION
 November 12, 2010
    /s/ Heath B. ClarkeDate
    Heath B. ClarkeChief Executive Officer
(principal executive officer) and ChairmanNovember 12, 2010

/s/
Kenneth S. CragunDate
    Kenneth S. CragunInterim Chief Financial Officer
(principal financial and accounting officer) and Secretary 35




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##### Table of Contents



INDEX TO EXHIBITS
 ExhibitNumber
    
    Description3.1 (1)
    
    Amended and Restated Certificate of Incorporation of the Registrant3.2 (2)
    
    Amendment to Restated Certificate of Incorporation of the Registrant3.2 (3)
    
    Amended and Restated Bylaws of the Registrant3.3 (4)
    
    Certificate of Ownership and Merger of Interchange Merger Sub, Inc. with and into Interchange Corporation3.4 (5)
    
    Certificate of Designation of Rights, Preferences and Privileges of Series A Participating Preferred
Stock of Local.com Corporation.4.1 (5)
    
    Preferred Stock Rights Agreement, dated as of October 15, 2008, by and between Local.com Corporation and
Computershare Trust Company, N.A., as Rights Agent (which includes the form of Certificate of Designation
of Rights, Preferences and Privileges of Series A Participating Preferred Stock of Local.com Corporation
as Exhibit A thereto, the form of Rights Certificate as Exhibit B thereto, and the Stockholder Rights
Plan, Summary of Rights as Exhibit C thereto).10.1 (6)#
    
    Description of the Material Terms of the Companys Bonus Program as of January 27, 2010.10.2 (7)
    
    Second Amendment dated February 5, 2010 to Loan and Security Agreement dated June 26, 2009, by and among
Registrant, Local.com PG Acquisition Corporation, and Square 1 Bank.10.3 (8)
    
    Asset Purchase Agreement by and among the Registrant and LaRoss Partners, LLC dated February 12, 2010.10.4 (9)
    
    SuperMedia Superpages Advertising Distribution Agreement effective April 1, 2010 by and among the
Registrant and SuperMedia LLC.10.5 (10)
    
    Asset Purchase Agreement by and among the Registrant and Turner Consulting Group, LLC dated April 20,
2010.10.6 (11)
    
    First Amendment to Lease by and among the Registrant and The Irvine Company LLC dated April 21, 2010.10.7 (11)
    
    Second Amendment to Lease by and among the Registrant and The Irvine Company LLC dated April 21, 2010.10.8 (11)#
    
    Description of the Material Terms of the Registrants Bonus Program as of April 23, 2010.10.9 (11)#
    
    Second Amended and Restated Employment Agreement by and between the Registrant and Heath Clarke dated
April 26, 2010.10.10 (11)#
    
    Second Amended and Restated Employment Agreement by and between the Registrant and Stanley B. Crair dated
April 26, 2010.10.11 (11)#
    
    Amended and Restated Employment Agreement by and between the Registrant and Brenda Agius dated April 26,
2010.10.12 (11)#
    
    Amended and Restated Employment Agreement by and between the Registrant and Michael Plonski dated April
26, 2010.10.13 (12)
    
    Asset Purchase Agreement by and among the Registrant and LaRoss Partners, LLC dated May 28, 2010.10.14 (13)
    
    Third Amendment dated June 9, 2010 to Loan and Security Agreement dated June 26, 2009, by and among
Registrant and Square 1 Bank.10.15 (14)
    
    Amendment No. 7 to Yahoo! Publisher Network Agreement dated June 8, 2010 by and among the Registrant and
Yahoo! Inc.10.16 (15)
    
    Loan and Security Agreement dated June 28, 2010, by and between Registrant and Silicon Valley Bank.10.17 (16)
    
    Asset Purchase Agreement by and among the Registrant and Simply Static, LLC dated July 1, 2010.10.18 (17)
    
    Sales and Services Agreement dated July 16, 2010 by and among the Registrant and LaRoss Partners, LLC.10.19 (18)
    
    Amendment dated August 5, 2010 to Loan and Security Agreement dated June 28, 2010, by and among
Registrant and Silicon Valley Bank.10.20 (19)
    
    Yahoo! Publisher Network Contract dated August 25, 2010 by and among the Registrant and Yahoo! Inc.10.21 (20)
    
    Amendment Number 1 to Yahoo! Publisher Network Contract dated August 30, 2010 by and among the Registrant
and Yahoo! Inc.10.22 (21)+
    
    Amendment No. 1 to SuperMedia Superpages Advertising Distribution Agreement dated September 30, 2010 by
and between the Registrant and SuperMedia LLC.10.23 (21)+
    
    Domain Purchase and Development Agreement dated September 30, 2010 by and between the Registrant and
SuperMedia LLC.10.24 (21)
    
    Asset Purchase Agreement dated September 30, 2010 by and between Registrant and Best Click
Advertising.com, LLC.10.25 (22)#
    
    Third Amended and Restated Employment Agreement by and between the Registrant and Kenneth Cragun dated
October 18, 2010.10.26 (22)#
    
    Separation and General Release Agreement by and among the Registrant and Brenda Agius dated October 18,
2010.10.27*#
    
    Amended and Restated Employment Agreement by and between the Registrant and Scott Reinke dated April 26,
2010.10.28*
    
    Microsoft adCenter Terms and Conditions
 36




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##### Table of Contents



ExhibitNumber
    
    Description10.29*
    
    Yahoo! Advertising Terms and Conditions31.1*
    
    Certification of Principal Executive Officer Required by Rule 13a-14(a) of the Securities Exchange Act of
1934, as amended, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2*
    
    Certification of Principal Financial Officer Required by Rule 13a-14(a) of the Securities Exchange Act of
1934, as amended, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1*
    
    Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350,
as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 
 *
    
    Filed herewith.#
    
    Indicates management contract or compensatory plan.+
    
    Application has been made with the Securities and Exchange Commission
to seek confidential treatment of certain provisions. Omitted
material for which confidential treatment has been requested has been
filed separately with the Securities and Exchange Commission.(1)
    
    Incorporated by reference from the Registrants Statement on Form
SB-2, Amendment No. 2, filed with the Securities and Exchange
Commission on September 16, 2004.(2)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on August
17, 2009(3)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on
November 2, 2007.(4)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K/A, filed with the Securities and Exchange Commission on
November 2, 2006.(5)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on
October 15, 2008.(6)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on
February 1, 2010.(7)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on
February 9, 2010.(8)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on
February 16, 2010.(9)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on April
2, 2010.(10)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on April
22, 2010.(11)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on April
27, 2010.(12)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on June
1, 2010.(13)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on June
11, 2010.(14)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on June
11, 2010.(15)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on July
1, 2010.(16)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on July
8, 2010.(17)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on July
22, 2010.(18)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on August
6, 2010. 37




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##### Table of Contents



(19)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on August
31, 2010.(20)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on
September 3, 2010.(21)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on
October 6, 2010.(22)
    
    Incorporated by reference from the Registrants Current Report on
Form 8-K, filed with the Securities and Exchange Commission on
October 19, 2010. 38