Document:

exv10w2

 

Exhibit 10.2

Portions of this exhibit indicated by “***” have been omitted pursuant to the Company’s request for
confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended, and the
omitted material has been separately filed with the Securities and Exchange Commission.

FIRST AMENDMENT

TO

AMENDED AND RESTATED PFP ADVERTISER 

DISTRIBUTION AGREEMENT

     This First Amendment to Amended and Restated PFP Advertiser Distribution Agreement
(“Amendment”) is effective as of the 1st day of March, 2008 (the “First Amendment Effective Date”)
and entered into by and between Local.com Corporation (f/k/a Interchange Corporation), a Delaware
corporation, whose principal offices are located at One Technology Drive, Building G, Irvine CA
92618 (“Local”), and Idearc Media Corp. (f/k/a Verizon Directories Corp.), a Delaware corporation,
with its principal place of business located at 2200 West Airfield Drive, D/FW Airport, Texas 75261
(“Idearc”), to amend the Amended and Restated PFP Advertiser Distribution Agreement
effective as of March 1, 2007 and entered into by and between Local and Idearc (the “Agreement”).

1. Amendments. The Agreement is hereby amended, as of the First Amendment Effective Date,
as follows:

	 	a.	 	Background Paragraph B. Paragraph B of the Background section
of the Agreement is amended to read in its entirety as follows:
	 
	 	 	 	Local offers Internet users access to (1) various content and services through (a)
the Internet web site it owns, operates, hosts and maintains located at
http://www.local.com (referred to as the “Local.com Web Site”) and (b) the Internet
web site it owns, operates, hosts and maintains located at
www.premierguide.com
(which Local obtained in connection with its acquisition of the assets of
PremierGuide, Inc. on or about July 2007) (the “PG Local-Owned Web Site”), (2)
co-branded and private label versions of such content and services (corresponding to
the LC Third Party Web Sites (defined below)) on Internet web pages that are owned,
operated, hosted and maintained by Local on its own servers and systems (each group
of such pages corresponding to each LC Third Party Site, an “LC Co-Branded Site”,
and every LC Co-Branded Site, collectively, the “LC Co-Branded Sites”), and (3)
various content and services through other Internet web sites which are owned,
hosted, operated and maintained by Third Party Networked Web Site Owner(s) (defined
below) (collectively, the “Local Networked Sites” and each, a “Local Networked
Site”). “LC Third Party Web Site” means each of, and “LC Third Party Web Sites”
means all of, (a) the PG Third Party Web Sites, (b) such other web site(s) that are
owned and operated by a third party and for which Local hosts a corresponding LC
Co-Branded Web Site as of March 1, 2008, and (c) such other web site(s) that are
owned and operated by a third party and that Idearc approves (as “LC Third Party Web
Site(s)” under this Agreement) in writing after Local’s request (which approval
Idearc may grant or deny in its sole discretion) and for which Local hosts a
corresponding LC Co-Branded Web Site. “PG Third Party

 

			
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	 	 	 	Web Site” means each of, and “PG Third Party Web Sites” means all of, the web sites
that are owned and operated by a third party and regarding which Local obtained the
right to provide local search and directory services in connection with its
acquisition of the assets of PremierGuide, Inc. on or about July 2007, and for which
Local hosts a corresponding LC Co-Branded Site. “LC Web Site” means each of, and
“LC Web Sites” means all of, the LC Co-Branded Sites and the PG Local-Owned Web
Site. “Local Web Site” means each of, and “Local Web Sites” means all of, the
Local.com Web Site and the LC Web Sites. The “Local Network” means the Local Web
Sites, the LC Third Party Web Sites and the Local Networked Sites, collectively.
	 
	 	b.	 	Background Paragraph C. Paragraph C of the Background section
of the Agreement is amended to read in its entirety as follows:
	 
	 	 	 	Local desires to (a) host search forms (on which users may enter search criteria)
and submission buttons and submission links (through which a search is submitted to
Local for information about local businesses) on the Local.com Web Site, the PG
Local-Owned Web Site and the LC Co-Branded Sites (each such search form, submission
button or submission link, a “Local Hosted Search Form” and, collectively, the
“Local Hosted Search Forms”), (b) allow the owner of each LC Third Party Web Site,
for which Local hosts a corresponding LC Co-Branded Site, to host search forms and
submission buttons and submission links on such LC Third Party Web Site (each such
search form, submission button or submission link, an “LC TP Search Form” and,
collectively, the “LC TP Search Forms”) and to receive search criteria submitted by
the end user through such LC TP Search Forms, and (c) send such search criteria
submitted by users through such Local Search Forms (defined below) from the Local
Server(s) (defined below), to the server(s) that host the Superpages.com Web Site
(the “Superpages.com Server(s)”), and Idearc desires to send, in eXtensible Markup
Language format (“XML format”), Search Results (as defined below) from the
database(s) that serves the Superpages.com Service (the “Superpages.com Business
Database”) to the Local Server(s), for display (1) on the search results page(s) on
the section of the Local.com Web Site, PG Local-Owned Web Site or LC Co-Branded Site
on which the Local SF Search (defined below) originated (in the case of Local SF
Searches submitted through a Local Hosted Search Form) or for display on search
results page(s) of the LC Co-Branded Site corresponding to the LC Third Party Web
Site on which the Local SF Search originated (in the case of Local SF Searches
submitted through an LC TP Search Form) (such search results page(s) on the Local
Web Sites may hereinafter be referred to as the “Local SF Results Page(s)”) and (2)
at Local’s option, on Local Business Detail Pages (defined below) and Additional
Local Pages (defined below), subject to the terms and conditions set forth in this
Agreement. “Local Search Form” means each of, and “Local Search Forms” means all
of, the Local Hosted Search Forms and the LC TP Search Forms.

 

			
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	 	c.	 	Background Paragraph E. Paragraph E of the Background section
of the Agreement is amended to read in its entirety as follows:
	 
	 	 	 	Local has implemented search engine marketing strategies (including, without
limitation, search engine optimization strategies) with respect to the Local.com Web
Site, and Local desires to send Search Criteria (defined below) submitted by users
of Search Engines (defined below) from the Local Server(s), to the Superpages.com
Server(s), and Idearc desires to send, in XML format, Search Results, from the
Superpages.com Business Database to the Local Server(s), for display (1) on the
search results page(s) on the Local.com Web Site (such search results pages, the
“Local SEM Results Page(s)”), accessible via a link on the Search Engine on which
the Search Criteria was submitted, and (2) at Local’s option, on Local Business
Detail Pages (defined below) and Additional Local Pages (defined below), subject to
the terms and conditions set forth in this Agreement.
	 
	 	d.	 	Local Web Site(s); Local.com Web Site. The Agreement is
amended to (i) change the reference to “Local Web Site” in Section 10(c) to “Local
Web Sites”, (ii) change the references to “Local Web Site” in Section 3(a) and
Section 3(b)(ii) to “Local.com Web Site”, and (iii) change the references to “the
Local Web Site” in Sections 1(q), 1(r), and 1(gg) to “a Local Web Site”.
	 
	 	e.	 	Definitions.

	 	i.	 	Local Qualified Click. Section 1(l) is
amended to read in its entirety as follows:
	 
	 	 	 	“Local Qualified Click(s)” means (i) with regard to a PPC Ad, an end-user
action consisting of clicking on an active link of a PPC Ad (1) displayed on
a Local Results Page in accordance with the terms and conditions of this
Agreement or (2) displayed on a Local Business Detail Page in accordance
with the terms and conditions of this Agreement or (3) displayed on an
Additional Local Page in accordance with the terms and conditions of this
Agreement, and (ii) with respect to a PfC Ad, an end-user action consisting
of clicking on an active link or button associated with a telephone number
contained in a PfC Ad (1) displayed on a Local Results Page in accordance
with the terms and conditions of this Agreement or (2) displayed on a Local
Business Detail Page in accordance with the terms and conditions of this
Agreement or (3) displayed on an Additional Local Page in accordance with
the terms and conditions of this Agreement, but excluding Invalid Clicks.
	 
	 	ii.	 	Local SEM Search. Section 1(o) is amended
to read in its entirety as follows:

 

			
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	 	 	 	“Local SEM Search(es)” means the process whereby Local sends Search Criteria
(some of which is submitted by users of a Search Engine) from the Local
Server(s) to the Superpages.com Server(s), and Idearc sends, in XML format,
Search Results related to such Search Criteria to the Local Server(s), and
Local displays such Search Results on the Local SEM Results Pages accessible
via a link on the Search Engine on which the Search Criteria was submitted
(and, at Local’s option, on Local Business Detail Pages or Additional Local
Pages), in accordance with this Agreement.
	 
	 	iii.	 	Local SF Search. Section 1(p) is amended
to read in its entirety as follows:
	 
	 	 	 	“Local SF Search” means the process whereby Local sends Search Criteria
(some of which is submitted by a user through a Local Search Form) from the
Local Server(s) to the Superpages.com server(s), and Idearc sends, in XML
format, Search Results relating to such Search Criteria to the Local
Server(s), and Local displays such Search Results on Local SF Results Pages
(and, at Local’s option, on Local Business Detail Pages or Additional Local
Pages) in accordance with this Agreement (excluding any search conducted
through the use of search form(s) into which the Search Form(s) may be
incorporated, but which does not involve Idearc).
	 
	 	iv.	 	Qualified Click. Section 1(aa) is amended
to read in its entirety as follows:
	 
	 	 	 	“Qualified Click(s)” means (i) with regard to a PPC Ad, an end-user action
consisting of clicking on an active link of a PPC Ad (1) displayed on a
Results Page in accordance with the terms and conditions of this Agreement
or (2) displayed on a Local Business Detail Page in accordance with the
terms and conditions of this Agreement or (3) displayed on an Additional
Local Page in accordance with the terms and conditions of this Agreement,
and (ii) with respect to a PfC Ad, an end-user action consisting of clicking
on an active link or button associated with a telephone number contained in
a PfC Ad (1) displayed on a Results Page in accordance with the terms and
conditions of this Agreement or (2) displayed on a Local Business Detail
Page in accordance with the terms and conditions of this Agreement or (3)
displayed on an Additional Local Page in accordance with the terms and
conditions of this Agreement, but excluding Invalid Clicks.
	 
	 	v.	 	Search Criteria. Section 1(ff)(ii) is
amended to delete the words “to Idearc”.
	 
	 	vi.	 	Search Page. Section 1(kk) is amended to
read in its entirety as follows:

 

			
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	 	 	 	“Search Page” shall mean each of, and “Search Pages” shall mean all of, the
Local Search Pages, LC TP Search Pages (defined below), and Network Search
Pages.
	 
	 	vii.	 	Additional Definitions. Section 1 is
amended to add the following definitions, as subsections (rr), (ss), (tt)
and (uu) respectively:
	 
	 	 	 	“Additional Local Page(s)” means page(s) of a Local Web Site that Idearc
approves (as “Additional Local Page(s)” under this Agreement) in writing
after Local’s written request (which approval Idearc may grant or deny in
its sole discretion). Notwithstanding anything to the contrary, an
“Additional Local Page” is not a “Local Results Page” or a “Local SF Results
Page” or a “Local SEM Results Page” or a “Results Page” for purposes of this
Agreement.
	 
	 	 	 	“Local Business Detail Page” means each of, and “Local Business Detail
Pages” means all of, the pages hosted by Local on a Local Web Site, which
include detailed information about a business. Notwithstanding anything to
the contrary, a “Local Business Detail Page” is not a “Local Results Page”
or a “Local SF Results Page” or a “Local SEM Results Page” or a “Results
Page” for purposes of this Agreement.
	 
	 	 	 	“Local Query” means a Query in which the Search Criteria elements that are
submitted by users are submitted through a Local Search Form or a Search
Engine.
	 
	 	 	 	“LC TP Web Site Owner(s)” means third party(ies) that own, operate, host or
maintain one or more LC Third Party Web Sites.
	 
	 	 	 	“LC TP Server(s)” means the server(s) that host LC Third Party Web Site(s).

	 	f.	 	Term; Renewal. Section 2, first sentence, is amended to read
in its entirety as follows:
	 
	 	 	 	Unless sooner terminated in accordance with the terms of this Agreement, this
Agreement will commence on the Amended Effective Date and will continue for a period
of one (1) year following March 1, 2008 (the “First Amendment Initial Term”), after
which it will automatically renew and extend on a month to month basis until
terminated in accordance with this Agreement (collectively, the “Term”). Either
party may terminate this Agreement after it converts to a month to month term for
any reason or no reason upon *** days prior written notice to the other party.
	 
	 	g.	 	Search Forms. Section 3(b), third sentence is amended as
follows:

 

			
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From:

In no event shall Local allow any third party hosting a Network Search Form
(or any other third party) to transmit Search Criteria directly to Idearc.

To:

In no event shall Local allow any third party hosting a Network Search Form or
an LC TP Search Form (or any other third party) to transmit Search Criteria
directly to Idearc.

	 	h.	 	Search Pages. Section 3(c) is amended to read in its entirety
as follows:
	 
	 	 	 	Local shall, at all times during the Term of this Agreement, (i) host the Local
Search Pages on its own servers and systems, (ii) ensure that all Network Search
Pages are hosted, operated and maintained by the Third Party Networked Web Site
Owner which owns the Related Web Site which includes such Network Search Page, (iii)
ensure that each page of each LC Third Party Web Site that contains an LC TP Search
Form (each, a “LC TP Search Page” and, collectively, the “LC TP Search Pages”) is
hosted, operated and maintained by the third party which owns such LC Third Party
Web Site, and (iv) use its best efforts to make the Search Forms and the related
functionality accessible to end users of the Local Network as contemplated in this
Agreement.
	 
	 	i.	 	Local’s Obligations. Section 3(f)(i) is amended to read in its
entirety as follows:

     i. Receive Search Results sent from the Superpages.com Server(s) to the Local
Server(s) in response to each Query, and shall:

          1. with respect to each Local Query initiated through a Search Form on the
Local.com Web Site or through a Search Engine, (a) display (to the end user who
initiated such Local Query) the PFP Ads contained within Search Results resulting
from such Local Query on each applicable resulting Local Results Page of the
Local.com Web Site, in accordance with the rules set forth on Exhibit H-1 to
this Agreement (the “Local.com Results Page Display Rules”), without altering the
content of the PFP Ads, and (b) at Local’s option, display (to the end user who
initiated such Local Query) one or more PFP Ads contained within Search Results
resulting from such Local Query on any Local Business Detail Page(s) and any
Additional Local Page(s) on the Local.com Web Site (only in such position(s), if
any, as Idearc may approve in writing and in advance, in its sole discretion from
time to time during the Term of this Agreement), without altering the content of the
PFP Ads and in the order, format and manner provided by Idearc (i.e., with respect
to the order of placement on each Local Business Detail Page and each Additional
Local Page, if Local displays *** PFP Ads on such page, even if the PFP Ads are
displayed along with search results from sources other than the PFP Service, Local shall ensure that the *** PFP Ad on
such page is the *** PFP Ad provided by Idearc in response to the Local Query

 

			
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relevant to such page (although not necessarily the *** advertisement appearing on
such page) and that the *** PFP Ad (if any) on such page is the *** PFP Ad provided
by Idearc in response to the Local Query relevant to such page (although not
necessarily the *** advertisement appearing on such page), etc.) or as otherwise
reasonably requested by Idearc. Notwithstanding anything to the contrary, in no
event shall Local display any PFP Ad (generated in response to a Local Query
initiated through a Search Form on the Local.com Web Site or through a Search
Engine) at any position on any Local Business Detail Page or any Additional Local
Page without the prior written approval of Idearc. Local shall ensure that ***
featured advertising box (labeled “Featured Sponsors” or labeled with similar text)
appears on each Local Results Page on the Local.com Web Site resulting from a Local
Query, above the fold, and before any other featured advertising space (the “***
Featured Advertising Box”), which will initially appear as set forth in Exhibit
F (Mock-Up of Results Page on Local.com Web Site). Except as expressly set
forth in the Local.com Results Page Display Rules, Local reserves the right, at its
sole discretion, to determine the look, feel, style, format, navigation and all
usability and visual design elements of the Local.com Web Site, including but not
limited to all content and adverting positions but expressly excluding each and
every PFP Ad. Notwithstanding anything in this Agreement to the contrary, Local
will not be obligated to display the *** Featured Advertising Box, in whole or in
part, on Local SEM Results Pages displayed in response to a Local Query initiated
through a Search Engine of a Search Engine Partner (defined below) when prohibited
by Local’s advertising agreement with Yahoo (existing as of the First Amendment
Effective Date) and associated display rules with MSN, Google, Yahoo and ASK (each,
a “Search Engine Partner” and collectively “Search Engine Partners”) which may
change from time to time at the sole discretion of the Search Engine Partners.

          2. with respect to each Local Query initiated through a Local Hosted Search
Form on the PG Local-Owned Web Site or through a Local Hosted Search Form on an LC
Co-Branded Site or through an LC TP Search Form, (a) at Local’s option, display (to
the end user who initiated such Local Query) PFP Ad(s) (contained within Search
Results provided by Idearc as a result of such Local Query) on the Local Results
Pages of the particular Local Web Site from which such Local Query was initiated
(or, to the extent such Local Query producing such PFP Ads was initiated on an LC
Third Party Web Site, on the Local Results Pages of the LC Co-Branded Web Site
corresponding to such LC Third Party Web Site), in accordance with the rules set
forth on Exhibit H-2 to this Agreement (the “LC Web Sites – Results Page
Display Rules”), without altering the content of the PFP Ads, and (b) at Local’s
option, display (to the end user who initiated such Local Query) *** PFP Ads
contained within Search Results resulting from such Local Query on any Local
Business Detail Page(s) and any Additional Local Page(s) on the particular Local Web
Site from which such Local Query was initiated (or, to the extent such Local Query
producing such PFP Ads was initiated on an LC Third Party Web Site, on the LC Co-Branded
Web Site corresponding to such LC Third Party Web Site) (only in such

 

			
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 position(s),
if any, as Idearc may approve in writing and in advance, in its sole discretion from
time to time during the Term of this Agreement), without altering the content of the
PFP Ads and in the order, format and manner provided by Idearc (i.e., with respect
to the order of placement on each Local Business Detail Page and each Additional
Local Page, if Local displays *** PFP Ads on such page, even if the PFP Ads are
displayed along with search results from sources other than the PFP Service, Local
shall ensure that the *** PFP Ad on such page is the *** PFP Ad provided by Idearc
in response to the Local Query relevant to such page (although not necessarily the
*** advertisement appearing on such page) and that the *** PFP Ad (if any) on such
page is the *** PFP Ad provided by Idearc in response to the Local Query relevant to
such page (although not necessarily the *** advertisement appearing on such page),
etc.) or as otherwise reasonably requested by Idearc. Notwithstanding anything to
the contrary, in no event shall Local display any PFP Ad (generated in response to a
Local Query initiated through a Local Hosted Search Form on the PG Local-Owned Web
Site or through a Local Hosted Search Form on an LC Co-Branded Site or through an LC
TP Search Form) at any position on any Local Business Detail Page or any Additional
Local Page without the prior written approval of Idearc. Except as expressly set
forth in the LC Web Sites – Results Page Display Rules, Local reserves the right, at
its sole discretion, to determine the look, feel, style, format, navigation and all
usability and visual design elements of the LC Web Sites, including but not limited
to all content and adverting positions but expressly excluding each and every PFP
Ad.

          3. with respect to Search Results resulting from a Network Search, transmit all
such Search Results directly to the appropriate Third Party Networked Server hosting
the Network Search Page from which the Network Search originated, and ensure that
the Third Party Networked Web Site Owner operating such Third Party Networked Server
displays all such Search Results on the resulting Network Results Pages on the Local
Networked Site on which the Network Search originated, without alteration to the
content and in the order, format and manner provided by Idearc (i.e., even if the
Search Results are displayed along with search results from sources other than the
PFP Service, the *** PFP Ad on a Network Results Page(s) shall be the *** PFP Ad
provided by Idearc in response to the Network Search generating such Network Results
Page(s) (although not necessarily the *** advertisement appearing on such Network
Results Page(s)).

	 	j.	 	Local’s Obligations. Section 3(f) is amended to add a new
subsections (vii), (viii) and (ix), to read in their entirety as follows:
	 
	 	 	 	(vii) Host, operate and maintain an LC Co-Branded Site (on Internet web pages that
are owned, operated, hosted and maintained by Local on its own servers and systems)
corresponding to (1) each web site that is owned and operated by a third
party and regarding which Local obtained the right to provide local search and
directory services in connection with its acquisition of the assets of PremierGuide,

 

			
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	 	 	 	Inc. on or about July 2007, and (2) each web site that Idearc approves in writing as
an LC Third Party Web Site;
	 
	 	 	 	(viii) (1) Host, operate and maintain each Local Business Detail Page and each
Additional Local Page on its own servers and systems, and (2) not add any link,
content, feature or functionality to (or in association with) any PFP Ad without
Idearc’s prior written consent, notwithstanding anything to the contrary; and
	 
	 	k.	 	Local’s Obligations. Sections 3(f)(ii), 3(f)(iv) and 3(f)(v)
are amended to add “and Local Business Detail Pages and Additional Local Pages”
after each reference to “Results Pages”, Section 3(f)(iii) is amended to add “the”
before the reference to “Search”, and Section 3(f)(vi) is amended to add “and
links” after the reference to “Searches”.
	 
	 	l.	 	License Grants; Covenants — Idearc. Section 4(a), subsection
(iii), is amended as follows:

From:

display the Search Results resulting from a Local Search within the resulting Local
Results Pages on the Local Web Site

To:

display the Search Results resulting from a Local Search initiated through a Local
Hosted Search Form within the Local Results Pages (and Local Business Detail Pages
and Additional Local Pages) on the Local Web Site on which the Local Search
originated (to the end user who initiated such Local Search), display the Search
Results resulting from a Local Search initiated through an LC TP Search Form within
the Local Results Pages (and Local Business Detail Pages and Additional Local Pages)
on the LC Co-Branded Site corresponding to the LC Third Party Web Site on which the
Local Search was originated (to the end user who initiated such Local Search), and
display the Search Results resulting from a Local Search initiated through a Search
Engine within the Local Results Pages (and Local Business Detail Pages and
Additional Local Pages) of the Local.com Web Site to the end user who initiated such
Local Search

	 	m.	 	License Grants; Covenants — Local.

	 	i.	 	Section 4(b)(ii) is amended to read in its entirety
as follows:
	 
	 	 	 	it will ensure that the Third Party Networked Servers are owned and operated
by the Third Party Networked Web Site Owner which owns the Local Networked
Site served by such Third Party Networked Server, and it will ensure that
the LC TP Servers are owned an operated by the LC TP
Web Site Owner which owns the LC Third Party Web Site served by such LC TP
Server

 

			
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	 	ii.	 	Section 4(b)(xi) is amended to read in its entirety
as follows:
	 
	 	 	 	it will not (and will ensure that each Third Party Networked Web Site Owner
and each LC TP Web Site Owner does not) use, or allow the use of, any
hyperlink to the Superpages.com Web Site or other device to “datamine” the
Superpages.com Business Database in any way
	 
	 	iii.	 	Section 4(b)(xii) is amended to read in its
entirety as follows:
	 
	 	 	 	it will ensure that no Third Party Networked Web Site Owner and no Search
Engine Owner and no LC TP Web Site Owner sends Search Criteria submitted
through a Search Form directly to any Superpages.com Server
	 
	 	iv.	 	Section 4(b)(xiv) is amended to read in its
entirety as follows:
	 
	 	 	 	it will ensure that no Search Engine Owner and no LC TP Web Site Owner
engages in any activity with respect to the PFP Service (including, without
limitation, Search Results related thereto) except as expressly contemplated
herein,
	 
	 	v.	 	Section 4(b) is amended to add the following:
	 
	 	 	 	and (xv) it will not transfer, transmit, distribute, provide or otherwise
make available all or any portion of any Search Results to any LC TP Web
Site Owner or any LC TP Server, and (xvi) it will ensure that each LC TP Web
Site Owner does not edit, modify or create any derivative works of all or
any part of the SuperPages.com Service without Idearc’s express prior
written consent.

	 	n.	 	Traffic Credits. Section 5(b) is amended to read in its
entirety as follows:
	 
	 	 	 	Local acknowledges and agrees that, notwithstanding anything to the contrary, the
Parties intend for Idearc to receive all web site traffic credit for all pages of
the Local.com Web Site as measured by ComScore/Media Metrix, including, without
limitation, *** The technical implementation of the method for assigning traffic
credit as set forth above will be performed by Local in its sole discretion. In
addition, Local shall make reasonable efforts to ensure that Idearc receives all web
site traffic credit for all pages of the Local.com Web Site as measured by Neilson,
including, without limitation, ***
	 
	 	o.	 	Compensation — Revenue Share). Section 6(a)(i) is amended to
read in its entirety as follows:

	 	i.	 	Local Web Sites.

 

			
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          1. Amount. With respect to each calendar month of this Agreement
(beginning with March 2008), Idearc will pay Local the Local PFP Revenue Share for
such calendar month, in accordance with the provisions of Section 6(a)(i)(2), below.
The “Local PFP Revenue Share” for a calendar month is determined as follows: (i)
if Total Revenue (as defined in this subsection) relating to such calendar month is
of a total amount that is less than or equal to ***, the Local PFP Revenue Share for
such calendar month is *** of the Local Revenue relating to such calendar month (ii)
if Total Revenue (as defined in this subsection) relating to such calendar month is
of a total amount that is greater than or equal to *** and less than or equal to
***, the Local PFP Revenue Share for such calendar month is *** of the Local Revenue
related to such calendar month and (iii) if Total Revenue (as defined in this
subsection) relating to such calendar month is of a total amount that is greater
than or equal to ***, the Local PFP Revenue Share for such calendar month is *** of
the Local Revenue relating to such calendar month. For purposes of this Agreement,
(a) “Total Revenue”, with respect to each calendar month, means *** of (i) all fees
billed by Idearc to its Bid Program advertisers for Qualified Clicks (occurring
during such calendar month) on PPC Ads and (ii) the PPC Equivalent Bid Amount for
each Qualified Click (occurring during such calendar month) on a PfC Ad, to the
express exclusion of any “minimum monthly fees” or other fees due to Idearc from its
advertisers that are not applied towards PPC or PfC fees for Qualified Clicks, and
(b) “Local Revenue”, with respect to each calendar month, means *** of (i) all fees
billed by Idearc to its Bid Program advertisers for Local Qualified Clicks
(occurring during such calendar month) on PPC Ads and (ii) the PPC Equivalent Bid
Amount for each Local Qualified Click (occurring during such calendar month) on a
PfC Ad, to the express exclusion of any “minimum monthly fees” or other fees due to
Idearc from its advertisers that are not applied towards PPC or PfC fees for Local
Qualified Clicks. For example, if Total Revenue relating to April 2008 is of a
total amount of ***, and Local Revenue for April 2008 is of a total amount of ***,
Idearc will pay Local ***, in accordance with the provisions of Section 6(a)(i)(2),
below).

          2. Time and Manner of Payment. Commencing on March 1, 2008 and
continuing throughout the remaining Term of this Agreement, Idearc will pay Local
the Local PFP Revenue Share, with respect to each calendar month of the Term of this
Agreement (beginning with March 2008), within *** days of the expiration of such
calendar month.

	 	p.	 	Compensation — Revenue Share). Section 6(a)(ii) is amended to
read in its entirety as follows:

	 	ii.	 	Network Results Pages.

          1. Amount. With respect to each calendar month of this Agreement
(beginning with March 1, 2008), Idearc will pay Local the Network PFP Revenue Share
for such calendar month, in accordance with the provisions of Section

 

			
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6(a)(ii)(2),
below. The “Network PFP Revenue Share” for a calendar month is determined as
follows: (i) if Total Revenue relating to such calendar month is of a total amount
that is less than or equal to ***, the Network PFP Revenue Share for such calendar
month is *** of the Network Revenue relating to such calendar month and (ii) if
Total Revenue relating to such calendar month is of a total amount that is greater
than or equal to ***, the Network PFP Revenue Share for such calendar month is ***
of the Network Revenue relating to such calendar month. For purposes of this
Agreement, “Network Revenue”, with respect to each calendar month, means *** of (i)
all fees billed by Idearc to its Bid Program advertisers for Network Qualified
Clicks (occurring during such calendar month) on PPC Ads displayed on a Network
Results Page in accordance with the terms and conditions of this Agreement and (ii)
the PPC Equivalent Bid Amount for each Network Qualified Click (occurring during
such calendar month) on a PfC Ad displayed on a Network Results Page in accordance
with the terms and conditions of this Agreement, to the express exclusion of any
“minimum monthly fees” or other fees due to Idearc from its advertisers that are not
applied towards PPC or PfC fees for Network Qualified Clicks. For example, if Total
Revenue relating to April 2008 is of a total amount of *** and Network Revenue
relating to April 2008 is of a total amount of ***, Idearc will pay Local ***, in
accordance with the provisions of Section 6(a)(ii)(2), below).

2. Time and Manner of Payment. Commencing on March 1, 2008 and
continuing throughout the remaining Term of this Agreement, Idearc will pay Local
the Network PFP Revenue Share, with respect to each calendar month of the Term of
this Agreement (beginning with March 2008), within *** days of the expiration of
such calendar month.

	 	q.	 	Compensation – Revenue Share — Miscellaneous. Section
6(a)(iii) is amended to add the following, as the first sentence thereof:
	 
	 	 	 	The Parties acknowledge and agree that the reference to *** in the definitions of
Total Revenue, Local Revenue and Network Revenue in this Agreement represents ***
(the “Monthly Adjustment”). The Monthly Adjustment includes ***.
	 
	 	r.	 	Compensation – Revenue Share — Invalid Clicks. Section
6(a)(iv) is amended to read in its entirety as follows:
	 
	 	 	 	Notwithstanding anything to the contrary, Idearc will have no payment obligation
whatsoever hereunder with respect to any Invalid Clicks. Notwithstanding anything
to the contrary, Local shall (and, with respect to Local Networked Sites and LC
Third Party Web Sites, shall ensure that the appropriate Third Party Networked Web
Site Owner and LC TP Web Site Owner, respectively) (a)
make(s) commercially reasonable efforts to prevent “bots”, “spiders” or other
automated processes or mechanisms from executing clicks on Pay For Performance
Advertisement(s) on the Local Network and from executing queries

 

			
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	 	 	 	from the Local Network (and from executing queries from a Search Engine), and (b) promptly block(s)
the IP addresses of any sites or servers which Idearc may request that Local block
from time to time in writing. Local shall notify Idearc as soon as reasonably
practical if a bot, spider, other similar process, mechanism, network or user cannot
be stopped from clicking on Pay For Performance Advertisements on a Local Web Site
or a Local Networked Site or from executing queries on a Local Web Site or a Local
Networked Site or an LC Third Party Web Site (or from executing queries from a
Search Engine), and shall not object if Idearc blocks such IP addresses at its own
initiative and expense on the Superpages Web Site (which Idearc will have the right
to do, notwithstanding anything to the contrary). Local shall ensure that each
Third Party Networked Web Site Owner notifies Local of the IP addresses of any
entities that that appear to be using “bots”, “spiders” or other similar mechanisms
used to execute clicks. Local shall, throughout the Term of the Agreement,
dynamically provide to Idearc the unique user IP addresses in the manner specified
by Idearc on a per click basis.
	 
	 	s.	 	Compensation — Monthly Local Query Fee. The Agreement is
amended to delete Section 6(b) in its entirety.
	 
	 	t.	 	Compensation – Implementation and Set-Up Fee. Section 6(c) is
amended to add the following sentence after the existing sentence:
	 
	 	 	 	In consideration for the effort to engineer, implement and provide these services,
Idearc agrees to pay a non-refundable engineering, implementation and set-up fee of
***, which will be due on ***.
	 
	 	u.	 	Exclusivity. Section 9 is amended to read in its entirety as
follows:
	 
	 	 	 	a. Idearc will be the exclusive provider for each Primary Exclusive PFP Ad Position
(defined in Exhibit H-1), and Local shall not display any advertisement or
content within any Primary Exclusive PFP Ad Position other than a PFP Ad (displayed
in accordance with this Agreement). Notwithstanding the foregoing, if Local does
not receive relevant Search Results from Idearc for any Local.com Query in ***
seconds or less from the time of Local’s submission of the Search Criteria for such
Local Query (a “Timed-Out Local.com Query”), Local may display Local Ads and
advertisements or content from a third-party for such Timed-Out Local.com Query in
the Primary Exclusive PFP Ad Position, as Local’s sole and exclusive remedy. For
purposes of this Agreement, a “Local.com Query” means a Query in which the Search
Criteria elements that are submitted by users are submitted through a Local Search
Form on the Local.com Web Site or a Search Engine regarding which Local has
implemented one or more search engine marketing strategies to drive traffic to the
Local.com
Web Site. Local shall monitor the percentage of Local.com Queries that are
Timed-Out Local.com Queries, and to the extent that greater than *** of all
Local.com Queries in a calendar month are Timed-Out Local.com Queries, Local

 

			
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	 	 	 	shall
notify Idearc (in a mutually agreed upon manner) and each Party shall use
commercially reasonable efforts to reduce the number of Timed-Out Local.com Queries
in the following calendar months to a number which is less than or equal to *** of
all Queries.
	 
	 	 	 	b. In addition, Idearc will be the exclusive provider for each Exclusive PFP
Backfill Position (defined in Exhibit H-1), and Local shall not display any
advertisement or content within any Exclusive PFP Backfill Position other than a PFP
Ad (displayed in accordance with this Agreement).
	 
	 	 	 	c. Except as expressly provided in this Agreement, this Agreement is non-exclusive.
As such, (a) Local reserves the right to display Pay For Performance Advertisements
on a non-exclusive basis with respect to Local advertisers and advertisers of third
parties, except as expressly provided in this Agreement, and (b) Idearc reserves the
right to provide the PFP Service, in whole or in part, to third parties.
	 
	 	v.	 	Termination for Convenience. Section 11(b) is amended to
replace “Amended Initial Term” with “First Amendment Initial Term”.
	 
	 	w.	 	Indemnification – Idearc. Section 14(b), first and second
sentences, are amended to add “or LC TP Web Site Owner” immediately before the end
of each such sentence.
	 
	 	x.	 	Indemnification – Local. Section 14(c) is amended to read in
its entirety as follows:
	 
	 	 	 	Local shall further indemnify, defend and hold Idearc harmless from and against any
and all Damages suffered or incurred by Idearc in connection with any Proceeding
against Idearc arising from (i) any content on, or the operation of, any Local.com
Web Site or any Local Networked Site (except as to the content of any Search Results
provided by Idearc hereunder to the extent that such Search Results were displayed
as required by this Agreement without modification by Local or a Third Party
Networked Web Site Owner or any Search Engine Owner), which violates any applicable
local, state or federal licensing requirement or any applicable law (including
without limitation, laws prohibiting false, fraudulent, deceptive or misleading
advertising and laws prohibiting defamation, obscenity, indecency and pornography),
(ii) any LC Web Site or any LC Third Party Web Site or any Local Business Detail
Page or any Additional Local Page (except as to the content of any Search Results
provided by Idearc hereunder to the extent that such Search Results were displayed
as required by this Agreement without modification by Local or any LC TP Web Site
Owner or any Search Engine Owner), including, without limitation, the operation
thereof and any content
thereon which violates any applicable local, state or federal licensing requirement
or any applicable law (including without limitation, laws prohibiting false,
fraudulent, deceptive or misleading advertising and laws prohibiting defamation,

 

			
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		 	obscenity, indecency and pornography), (iii) the negligence, gross negligence,
willful misconduct or any action or failure to act of any Third Party Networked Web
Site Owner or Search Engine Owner or any LC TP Web Site Owner, (iv) any infringement
by any Third Party Networked Web Site Owner or Search Engine Owner or any LC TP Web
Site Owner upon any third party’s intellectual property rights, privacy rights, or
other third party rights, or (v) the domain name of any LC Co-Branded Site or any
other site in the Local Network. Without limiting the generality of the foregoing
provisions of Section 14, Local shall and does hereby agree to further indemnify,
defend and hold Idearc harmless from and against any and all Damages suffered or
incurred by Idearc in connection with any Proceeding against Idearc arising from or
relating to any feature, mechanism or functionality in connection with which any
Search Results are requested or used that violates or infringes upon any patent or
other intellectual property right of any third party.
	 
	y.	 	Limitation of Liability; Disclaimers. Section 15(a) is amended
to replace the reference to “Amendment Effective Date” with “Amended Effective
Date”. Sections 15(b)(ii), 15(b)(iv) and 15(b)(v) are amended to add “or LC TP Web
Site Owner” immediately after each reference to “Search Engine Owner”.
	 
	z.	 	Exhibit A (Form of Monthly Usage Reports by Local). Exhibit A
is amended to read in its entirety as set forth in Schedule 1, attached hereto and
incorporated herein.
	 
	aa.	 	Exhibit B (Form of Monthly Usage Reports by Idearc). Exhibit B
is amended to read in its entirety as set forth in Schedule 2, attached hereto and
incorporated herein.
	 
	bb.	 	Exhibit E (Guidelines for Advertising). Exhibit E is amended
to (a) add “and each LC TP Web Site Owner” immediately after the reference to
“Third Party Networked Web Site Owner”, and (b) replace “on the Search Pages or
Results Pages” (in the introductory language) with “on any Search Page, Results
Page, Business Profile Page or Additional Page and”.
	 
	cc.	 	Exhibit F. Exhibit F is amended to read in its entirety as set
forth in Schedule 3, attached hereto and incorporated herein.
	 
	dd.	 	Exhibit G (Minimum Monthly Local Query Goals). The Agreement
is amended to delete Exhibit G in its entirety.
	 
	ee.	 	Exhibit H (Display Rules). Exhibit H is amended to read in its
entirety as set forth in Schedules 4 and 5, attached hereto and incorporated
herein.

2. Miscellaneous. The undersigned, by their execution of this Amendment, represent that
they are duly authorized to enter into this Amendment on behalf of Idearc and Local, respectively.
This Amendment may be executed in one or more counterparts, any of which need

 

			
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not contain the
signatures of both parties, but all signed counterparts taken together will constitute one and the
same agreement. A facsimile signature will be deemed as valid as an original signature. All terms
and conditions of the Agreement not expressly modified by this Amendment will remain in full force
and effect. In the case of a conflict between this Amendment and the Agreement, this Amendment
will govern and prevail. All Section headings, titles and subtitles are in this Amendment for
convenience of reference only, and are to be ignored in any constructions of this Amendment’s
provisions.

 

			
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     In Witness Whereof, the parties have executed this Amendment on the date(s) written below, but
effective as of the First Amendment Effective Date.

	 	 	 	 	 	 	 	 	 	 	 	 	 
	LOCAL.COM CORPORATION	 	 	 	IDEARC MEDIA CORP.
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	By:
	 	 	 	/s/ Douglas S. Norman 	 	 	 	By:	 	 	 	/s/ Scott Laver 
	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Printed Name:	 	Douglas S. Norman	 	 	 	Printed Name:	 	Scott Laver
	 

	 	 	 	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Title:

	 	 	 	CFO	 	 	 	Title:	 	 	 	President
	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Date:

	 	 	 	3/7/08	 	 	 	Date:	 	 	 	3/7/08
	 	 	 	 	 	 	 	 	 

 

			
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Schedule 1

Exhibit A

Form of Monthly Usage Reports by Local

The Time Out report generated by Local for each calendar month will show the number of Local.com
Queries Local transmits to Idearc during such calendar month as well as the number of Timed-Out
Local.com Queries in such calendar month. A percentage calculation will also be performed to show
the % of Local.com Queries that are Timed-Out Local.com Queries. For each calendar month, the Time
Out Report will be in the following format:

	 	 	 	 	 
	Time Out Report	 	#	 
	# of Local.com Queries sent to Idearc
	 	 	 	 
	# of Timed-Out Local.com Queries
	 	 	 	 
	% of Local.com Queries that are Timed-Out Local.com Queries
	 	 	 	 

 

			
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Schedule 2

Exhibit B

Form of Monthly Usage Reports by Idearc

	 	 	 	 	 
	Local PFP Revenue Share	 
	Month/Year                     	 
	 	 	Month	 
	Total Local Queries
	 	 	 	 
	Local Searches
	 	 	 	 
	Coverage
	 	 	 	 
	CTR
	 	 	 	 
	Local Qualified Clicks
	 	 	 	 
	Local Revenue
	 	 	 	 

Local PFP Revenue Share=

	 	 	 	 	 
	Network PFP Revenue Share	 
	Month/Year                     	 
	Network Qualified Clicks
	 	 	 	 

Network PFP Revenue Share=

 

			
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Schedule 3

Exhibit F

Mock-Up of Results Page on Local.com Web Site

 

			
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Schedule 4

Exhibit H-1

Local.com Results Page Display Rules

For purposes of this Agreement, “Local Ads” means advertisements sold by Local’s sales force (or
the third party call center sales agent acting on behalf of Local).

With respect to each Local Query initiated through a Search Form on the Local.com Web Site or
through a Search Engine, Local shall display the PFP Ads contained within Search Results resulting
from such Local Query on each applicable resulting Local Results Page of the Local.com Web Site, in
accordance with the following rules:

	1.	 	Local shall ensure that *** featured advertising box (labeled “Featured Sponsors” or labeled
with similar text) appears on each Local Results Page on the Local.com Web Site resulting from
such Local Query, above the fold, and before any other featured advertising space (i.e., the
“***t Featured Advertising Box” defined above), which will initially appear as set forth in
Exhibit F (Mock-Up of Results Page on Local.com Web Site). Local shall ensure that
the *** Featured Advertising Box contains a minimum of *** advertising positions.

	2.	 	Local shall display *** PFP Ad (contained within Search Results provided by Idearc as a
result of such Local Query) in the *** advertising position in the *** Featured Advertising
Box of each Local Results Page of the Local.com Web Site resulting from such Local Query
(unless there are no PFP Ads contained within Search Results provided by Idearc as a result of
such Local Query, in which event Local may display Local Ads and advertisements or content
from a third party in such First Featured Advertising Box) (the advertising position in which
Local is obligated to display a PFP Ad in accordance with the provisions of this Section 2 of
this Exhibit H-1, the “Primary Exclusive PFP Ad Position”). For the avoidance of doubt, if
there are less than *** advertising positions in the *** Featured Advertising Box of the Local
Results Pages of the Local.com Web Site resulting from such Local Query, Local shall
nevertheless display *** PFP Ad in such *** Featured Advertising Box on each such Local
Results Page (unless there are *** PFP Ads contained within Search Results provided by Idearc
as a result of such Local Query, in which event Local may display Local Ads and advertisements
or content from a third party in such *** Featured Advertising Box on each such Local Results
Page).

	3.	 	In addition, if there are not enough Local Ads appropriate to the *** Featured Advertising
Box on Local Results Pages of the Local.com Web Site resulting from such Local Query to fill
the number of advertising positions remaining in the *** Featured Advertising Box on such
Local Results Pages (after accommodating the PFP Ad placement described in Section 2 of this
Exhibit H-1 and without repeating any Local Ad in any *** Featured Advertising Box) (such
remaining advertising positions, the “FFA Backfill Positions”), then Local shall display PFP
Ads (contained within Search Results provided by Idearc as a result of such Local Query) in
the *** Featured Advertising Box (of each Local Results Page of the

 

			
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	 	 	Local.com Web Site resulting from such Local Query) in an amount necessary to fill all FFA Backfill
Positions (unless there are not enough PFP Ads contained within Search Results provided by
Idearc as a result of such Local Query to fill all FFA Backfill Positions, in which case Local
shall display the number of such PFP Ads remaining (after accommodating the PFP placement
described in Section 2 of this Exhibit H-1) in the *** Featured Advertising Box (of each Local
Results Page of the Local.com Web Site resulting from such Local Query), and Local may display
Local Ads and advertisements or content from a third party in the remaining FFA Backfill
Positions (after accommodating, and below, the PFP Ads that Local is obligated to display
under this Section 3 of this Exhibit H-1) in the *** Featured Advertising Box (of each Local
Results Page of the Local.com Web Site resulting from such Local Query)) (the advertising
positions in which Local is obligated to display a PFP Ad in accordance with the provisions of
this Section 3 of this Exhibit H-1, each an “Exclusive PFP Backfill Position”, and
collectively, the “Exclusive PFP Backfill Positions”).

	4.	 	In addition, Local may, at Local’s option, display PFP Ads (contained within Search Results
provided by Idearc as a result of such Local Query) only in such additional position(s) (on
Local Results Pages of the Local.com Web Site resulting from such Local Query), if any, as
Idearc may approve in writing and in advance, in its sole discretion from time to time during
the Term of this Agreement. Notwithstanding anything to the contrary, except with respect to
Local’s obligations under Sections 1, 2 and 3 of this Exhibit H-1, in no event shall Local
display any PFP Ad at any position on any Local Results Page of the Local.com Web Site without
the prior written approval of Idearc.

	5.	 	Notwithstanding anything to the contrary, with respect to each Local Results Page of the
Local.com Web Site resulting from such Local Query, Local shall display the PFP Ads (contained
within Search Results provided by Idearc as a result of such Local Query) in the order, format
and manner provided by Idearc (i.e., with respect to the order of placement on each Local
Results Page of the Local.com Web Site resulting from such Local Query, even if the PFP Ads
are displayed along with search results from sources other than the PFP Service, Local shall
ensure that the *** PFP Ad on such Local Results Page is the *** PFP Ad provided by Idearc in
response to the Local Query generating such Local Results Page (although not necessarily the
*** advertisement appearing on such Local Results Page) and that the *** PFP Ad (if any) on
such Local Results Page is the *** PFP Ad provided by Idearc in response to the Local Query
generating such Local Results Page (although not necessarily the *** advertisement appearing
on such Local Results Page), etc., regardless of whether or not any of the PFP Ads that are
displayed are displayed in a featured advertising box or otherwise) or as otherwise reasonably
requested by Idearc.

	6.	 	Notwithstanding anything to the contrary, with respect to each Local Query initiated
through a Search Form on the Local.com Web Site or through a Search Engine, Local shall not
display any PFP Ad contained within Search Results resulting from such Local Query on any
single resulting Local Results Page more than one time, without the prior written consent
of Idearc.

 

			
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Schedule 5

Exhibit H-2

LC Web Sites — Results Page Display Rules

With respect to each Local Query initiated through a Local Hosted Search Form on the PG Local-Owned
Web Site or through a Local Hosted Search Form on an LC Co-Branded Site or through an LC TP Search
Form, at Local’s option, Local may display *** of the PFP Ads (contained within Search Results
provided by Idearc as a result of such Local Query) only in such additional position(s) (on the
Local Results Pages of the applicable Local Web Site, as specified in Section 3(f)(i)(2) of this
Agreement), if any, as Idearc may approve in writing and in advance, in its sole discretion from
time to time during the Term of this Agreement, in the order, format and manner provided by Idearc
(i.e., with respect to the order of placement on each such Local Results Page, if Local displays
*** PFP Ads on such Local Results Page, even if the PFP Ads are displayed along with search results
from sources other than the PFP Service, Local shall ensure that the *** PFP Ad on such Local
Results Page is the *** PFP Ad provided by Idearc in response to the Local Query generating such
Local Results Page (although not necessarily the *** advertisement appearing on such Local Results
Page) and that the *** PFP Ad (if any) on such Local Results Page is the *** PFP Ad provided by
Idearc in response to the Local Query generating such Local Results Page (although not necessarily
the *** advertisement appearing on such Local Results Page), etc., regardless of whether or not any
of the PFP Ads that are displayed are displayed in a featured advertising box or otherwise) or as
otherwise reasonably requested by Idearc.

Notwithstanding anything to the contrary, in no event shall Local display any PFP Ad at any
position on any Local Results Page resulting from any Local Query initiated through a Local Hosted
Search Form on the PG Local-Owned Web Site or through a Local Hosted Search Form on an LC
Co-Branded Site or through an LC TP Search Form without the prior written approval of Idearc.

Notwithstanding anything to the contrary, with respect to each Local Query initiated through a
Local Hosted Search Form on the PG Local-Owned Web Site or through a Local Hosted Search Form on an
LC Co-Branded Site or through an LC TP Search Form, Local shall not display any PFP Ad contained
within Search Results resulting from such Local Query on any single resulting Local Results Page
more than one time, without the prior written consent of Idearc.

 

			
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filed separately with the Securities and Exchange CommissionTIERONE BANK 
AMENDED AND RESTATED
DEFERRED COMPENSATION PLAN 

ARTICLE 1.
 
ESTABLISHMENT AND PURPOSE OF PLAN  

        1.1    Establishment
of the Plan. Effective as of December 20, 2007, the Deferred Compensation Plan (the
“Prior Plan”) was amended and restated in its entirety. The Prior Plan was
adopted as of August 15, 2002 and amended and restated as of July 27, 2006. This amended
and restated plan shall be known as the Deferred Compensation Plan (the “Plan”)
and shall in all respects be subject to the provisions set forth herein.  

        1.2    Purpose
of the Plan. The purpose of the Plan is to provide a deferred compensation
arrangement and deferred bonus arrangement to a select group of management, highly
compensated employees or members of the Board of Directors of the Employer. The Plan is
intended to be an unfunded plan qualifying as a “top hat” plan for purposes of
Title I of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”),
and for purposes of the Internal Revenue Code of 1986, as amended (the “Code”).
The Plan is being amended and restated in order to comply with the requirements of
Section 409A of the Code and the final regulations issued by the IRS. No benefits payable
under this Plan shall be deemed to be grandfathered for purposes of Section 409A of the
Code.  

        1.3    TierOne
Bank Supplemental Deferred Compensation Plan. The TierOne Bank (the “Bank”)
Supplemental Deferred Compensation Plan (the “Supplemental Plan”) that was
effective as of January 1, 1997 shall be merged into this Plan effective as of July 27,
2006. Accordingly, all deferrals and benefits under the Supplemental Plan subsequent to
such date shall in all respects be subject to and governed by the provisions set forth
herein. All benefits earned under the Supplemental Plan immediately prior to July 27,
2006 shall be credited to a Participant’s Deferred Compensation Account (as defined
herein).  

ARTICLE 2.  
DEFINITIONS  

        2.1    Beneficiary.“Beneficiary” means
the person, persons or entity designated by the Participant, as provided in Article 5, to
receive any benefits payable under the Plan.  

        2.2    Board.
 “Board” means the Board of Directors of the Sponsoring Employer. 

        2.3    Change
in Control. “Change in Control” means a change in the ownership of the Bank
or the Company, a change in the effective control of the Bank or the Company or a change
in the ownership of a substantial portion of the assets of the Bank or the Company as
provided under Section 409A of the Code and the regulations thereunder.  

        2.4    Committee.“Committee” means
the Compensation Committee of the Board or such other committee as may be appointed by
the Board to administer the Plan pursuant to Article 3.  

        2.5    Company.
 “Company”  means TierOne  Corporation,  the owner of 100% of the issued and
 outstanding  common stock of the Bank. 

        2.6    Company
Stock.  “Company Stock” shall mean shares of common stock of the Company. 

        2.7    Compensation.
 “Compensation”  or “Total  Compensation”  means the Base  Salary,
 Incentive  Compensation, Stock Denominated Awards and Director Fees payable to a
Participant during a Plan Year. 

	 	        (a)    Base
Salary. “Base Salary” means all cash payable to a           Participant by
the Employer as remuneration for services rendered during a Plan           Year, and
shall be determined prior to any reduction for amounts deferred by a
          Participant under the Employer-sponsored 401(k) plan. Base Salary shall also be
          calculated so as to exclude any employer-matching contributions or other
          contributions to the Participant’s 401(k) plan account, as well as any
          other nontaxable and/or noncash compensation payable to the Participant by
          his/her Employer.  

	 	        (b)    Incentive
Compensation. “Incentive Compensation” means any cash           bonus paid
to a Participant by the Employer during a Plan Year.  

	 	        (c)    Stock
Denominated Award. “Stock Denominated Award” means a           restricted
stock award granted pursuant to the Company’s amended and           restated 2003
Recognition and Retention Plan.  

	 	        (d)   Director
Fees. “Director Fees” means any annual retainer fees,
               monthly Board fees, attendance fees or emeritus fees paid to current
Directors                or retired former Directors for their services as a Director of
the Employer.  

        2.8    Contribution
Date. “Contribution Date” means the date a Participant would have received
the Compensation or, if applicable, a Participant’s 401(k) account or ESOP account
would have been credited, but for the Deferral Election.  

        2.9    Declared
Rate. “Declared Rate” means an interest rate determined from time to time
by the Committee in its discretion which is based on the Employer’s three (3) or
five (5) year certificate of deposit rate.  

        2.10    Deferral
Election. “Deferral Election” means a Participant’s written election
to the Committee to defer any or all of his/her Base Salary, Incentive Compensation,
Stock Denominated Award or Director Fees.  

        2.11    Deferred
Compensation. “Deferred Compensation” means the amount of Base Salary,
Incentive Compensation, Stock Denominated Award or Director Fees deferred by a
Participant pursuant to the Deferral Election in effect at the time of deferral.  

        2.12    Deferred
Compensation Account. “Deferred Compensation Account” means the account
maintained on the books of the Employer with respect to the Plan. Each Deferred
Compensation Account shall consist of the following sub-accounts: (i) Fixed Income Fund
Account, (ii) Investment Fund Account, (iii) Stock Units Account; (iv) Director Fees
Account and (v) such other sub-accounts as may be necessary to reflect such Plan Year’s
allocation and such further sub-Accounts as the Committee may deem necessary. A
Participant’s Deferred Compensation Account shall be utilized solely as a device for
the measurement and determination of any benefits payable to the Participant pursuant to
this Plan. A Participant shall have no interest in his Deferred Compensation Account, nor
shall it constitute or be treated as a trust fund of any kind.  

-2 - 

        2.13    Determination
 Date.  “Determination  Date”  means  any date on  which a debit  or a
 credit  is made to a Participant’s Deferred Compensation Account. 

        2.14    Director.
 “Director”  means  any  active  member  of the Board and any  retired  former
 Director  who is servicing as a director emeritus. 

        2.15    Disability.
“Disability” means a Participant (i) is unable to engage in any substantial
gainful activity by reason of any medically determinable physical or mental impairment
which can be expected to result in death or can be expected to last for a continuous
period of not less than twelve months; or (ii) is, by reason of any medically
determinable physical or mental impairment which can be expected to result in death or
can be expected to last for a continuous period of not less than twelve months, receiving
income replacement benefits for a period of not less than three months under an accident
and health plan covering employees of the Employer (or would have received such benefits
for at least three months if the Participant had been eligible to participate in such
plan). The determination of the Board as to Disability shall be binding on a Participant.  

        2.16    Employee.
“Employee” means any person who performs services for the Employer and to whom
the Employer pays Compensation on a regular basis.  

        2.17    Employer.
“Employer” means TierOne Bank or TierOne Corporation, as applicable, and any
successor to the business thereof and any subsidiary whose board of directors adopts this
Plan.  

        2.18    Fixed
Income Fund. “Fixed Income Fund” means an investment fund for Deferred
Compensation (which shall include any deferral of Director Fees) which provides interest
on the Deferred Compensation Account as set forth in Section 4.7(a) below.  

        2.19    Investment
Direction.“Investment Direction” means a Participant’s written
direction to the Committee to invest the Participant’s Deferred Compensation Account
in the Fixed Income Fund and/or the Investment Fund.  

        2.20    Investment
Fund. “Investment Fund” means an investment fund for Deferred Compensation
(which shall include any deferral of Director Fees) consisting of investment in mutual
funds and/or other marketable securities by a Participant; provided, however, said
investment must be reported to the Employer from the broker on a consolidated statement.  

        2.21    Participant.
“Participant” means any Employee or Director of the Employer identified and
selected for participation in the Plan by the Committee and who elects to defer
compensation.  

3 

        2.22    Participation
Agreement. “Participation Agreement” means the agreement in such form as
may be determined by the Committee from time to time between the Employer and a
Participant with respect to the Participant’s participation in the Plan.  

        2.23    Payment
Event.  “Payment Event” shall have the meaning set forth in Section 5.1
below. 

        2.24    Phantom
401(k)  Contribution.  “Phantom 401(k)  Contribution”  shall have the
meaning set forth in Section 6.1 of this Plan. 

        2.25    Phantom
ESOP  Contribution.  “Phantom ESOP  Contribution”  shall have the meaning
set forth in Section 6.2 of this Plan. 

        2.26    Plan.
“Plan” means the Deferred Compensation Plan, as amended and restated. 

        2.27    Plan
Year.  “Plan  Year”  means a twelve  (12) month  period  commencing  each
 January 1  and ending each December 31, or such other Plan Year as determined by the
Committee. 

        2.28    Separation
from Service. “Separation from Service” means a termination of the
Participant’s services (whether as an employee or as an independent contractor) to
the Employer for a reason other than death or Disability. Whether a Separation from
Service has occurred shall be determined in accordance with the requirements of Section
409A of the Code based on whether the facts and circumstances indicate that the Employer
and the Participant reasonably anticipated that no further services would be performed
after a certain date or that the level of bona fide services the Participant would
perform after such date (whether as an employee or as an independent contractor) would
permanently decrease to no more than twenty percent (20%) of the average level of bona
fide services performed (whether as an employee or an independent contractor) over the
immediately preceding thirty-six (36) month period.  

        2.29    Service
Period. “Service Period” means any period of time during which a
Participant performs services for which he/she earns Compensation during a Plan Year.  

        2.30    Specified
Employee. “Specified Employee” means a key employee as defined in Section
416(i) of the Code (without regard to Section 416(i)(5) of the Code) and as otherwise
defined in Section 409A of the Code and the regulations thereunder.  

        2.31    Sponsoring
Employer.  “Sponsoring Employer” means TierOne Bank. 

        2.32    Spouse.
“Spouse” means a Participant’s wife or husband who was lawfully married to
the Participant prior to and at the time of the Participant’s retirement,
disability, death or Separation from Service.  

        2.33    Stock
Units. “Stock Units” shall represent shares of Company Stock, with each
Stock Unit representing one share of Company Stock.  

        2.34    Unforeseeable
Emergency. “Unforeseeable Emergency” means a severe financial hardship to
the Participant resulting from (1) an illness or accident of the Participant, the
Participant’s spouse, or a dependent of the Participant (within the meaning of
Section 152(a) of the Code), (2) loss of the Participant’s property due to casualty,
or (3) other extraordinary and unforeseeable circumstances arising as a result of events
beyond the control of the Participant. The amount of such distribution may not exceed the
amounts necessary to satisfy the emergency. The circumstances that will constitute an
“Unforeseeable Emergency” will depend on the facts of each case, but, in any
case, payment may not be made in the event that such hardship is or may be relieved:  

4 

	 	        (a)              through
reimbursement or compensation by insurance or otherwise;  

	 	        (b)              by
liquidation of the Participant’s assets, to the extent that liquidation           of
such assets would not itself cause severe financial hardship; or  

	 	        (c)              by
cessation of deferrals under the Plan.  

ARTICLE 3.

ADMINISTRATION  

        3.1    Committee;
Duties.  

        (a)    Generally.
The Plan shall be administered by the Committee or any           successor committee
thereto appointed by the Board. Members of the Committee may           be Participants
under the Plan. The Committee shall also have the authority to           make, amend,
interpret and enforce all appropriate rules and regulations for the
          administration of the Plan and to decide or resolve any and all questions,
          including interpretations of the Plan, as may arise in connection with the
Plan.  

        (b)    Selection
and Termination of Participants. The Committee shall identify           and select
Employees or Directors of the Employer or the Company who shall be           eligible to
participate in the Plan. The Committee may terminate participation           of any
Participant upon written notice to the Participant; provided, however           that the
effective date of such termination may be no earlier than January 1           following
the date such written notice is provided.  

        3.2    Agents.
In the administration of the Plan, the Committee may, from time to time, employ an agent
and delegate to it such administrative duties as it sees fit and may, from time to time,
consult with counsel who may be counsel to the Employer.  

        3.3    Binding
Effect of Decisions. The decision or action of the Committee with respect to any
question arising out of or in connection with the administration, interpretation and
application of the Plan and the rules and regulations promulgated hereunder shall be
final and conclusive and binding upon all persons having any interest in the Plan.  

        3.4    Indemnity
of Committee. The Employer shall indemnify and hold harmless the members of the
Committee against any and all claims, loss, damage, expense or liability arising from any
action or failure to act with respect to the Plan, except in the case of gross negligence
or willful misconduct by the Committee or any of its members.  

5 

ARTICLE 4.  
DEFERRED
COMPENSATION ACCOUNT  

        4.1    Enrollment
Requirements; Deferred Compensation Account. Each Participant shall complete, execute
and return to the Committee a Participation Agreement, Deferral Election and beneficiary
designation form prior to the election deadlines set forth in Section 4.2 below. The
Employer shall establish a Deferred Compensation Account for each Participant which shall
be administered pursuant to the terms and provisions of this Plan. If the Sponsoring
Employer serves as a common pay master, the Participation Agreements may be entered into
by the Sponsoring Employer on behalf of the Employer.  

        4.2    Timing
of Initial Deferral Election.  

        (a)    Generally.
An election to defer Compensation must be received by the           Committee prior to
the date specified in this Section 4.2 of the Plan. Any           elections to defer (i)
Base Salary, Incentive Compensation or Director Fees must           be made on or prior
to the December 31st preceding the calendar year           in which such
income shall be earned, subject to the exceptions provided in           Sections 4.2(b)
and 4.2(c) of the Plan, and (ii) Stock Denominated Awards must           be made on or
prior to the December 31 preceding the calendar year in which the           restricted
stock awards vest; provided that an election to defer a Stock           Denominated Award
may not be made after December 31, 2004 and no Stock           Denominated Award may be
deferred after December 31, 2005. Under no           circumstances may a Participant
defer Compensation to which the Participant has           already attained, at the time
of the deferral, a legally enforceable right to           receive such Compensation.  

        (b)    New
Participant. Notwithstanding anything in the Plan to the contrary, in           the
case of the first year in which a Participant becomes eligible to           participate
in the Plan, elections to defer Compensation may be made for           services to be
performed subsequent to the election within thirty (30) days of           the date a
Participant first becomes eligible to participate in this Plan, with           such
elections in each case to be effective as of the immediately following           payroll
period of the Employer.  

        (c)    Performance-Based
Compensation Deferral. Notwithstanding anything in the           Plan to the
contrary, a Participant may make a performance-based compensation           deferral
election with respect to Incentive Compensation that otherwise           qualifies as
“performance-based compensation” under Section 409A of           the Code. Such
election must be made during such period as shall be established           by the
Committee which ends no later than six (6) months prior to the last day           of the
period over which the services giving rise to the Incentive Compensation           are
performed, provided that the Incentive Compensation is based on the           performance
by the Participant of services for the Employer over a period of at           least
twelve (12) months (whether or not paid in such performance period) and           which
qualifies as “performance-based compensation” under Section 409A           of
the Code. If the performance period is less than twelve (12) months, then any
          election to defer the Incentive Compensation for such period must be made on or
          prior to the December 31st preceding the calendar year in which such income
          shall be earned, subject to the exception in Section 4.2(b) above.  

6 

        (d)              A
Participant may not elect to change his or her Deferral Election that is in
          effect for a Plan Year. The Committee, at its discretion, may permit a
          Participant to change his or her Deferral Election for a subsequent Plan Year,
          provided that the subsequent Deferral Election is made on or prior to the
          December 31st preceding the calendar year in which such income shall
          be earned.  

        4.3    Prior
Elections. Any payment elections made by a Participant before January 1, 2005 shall
continue in effect until such time as the Participant makes a subsequent payment election
pursuant to Section 4.4 below and such payment election becomes effective as set forth
below. If no payment election was previously made, then the current payment election
shall be deemed to be 120 monthly cash payments (240 monthly cash payments if the
Participant is a Director) commencing as of the first day of the month following the
lapse of six months after the Participant’s employment or service is terminated due
to a Separation from Service, death or Disability.  

        4.4    Transitional
Elections Prior to 2009. On or before December 31, 2008, if a Participant wishes to
change his payment election, the Participant may do so by completing a payment election
form approved by the Employer, provided that any such election (1) must be made at least
12 months before the date on which benefit payments due to a Separation from Service or
upon a fixed date are scheduled to commence, (2) must be made before the Participant has
a Separation from Service or a termination of employment or service due to death or
Disability, (3) shall not take effect before the date that is 12 months after the
date the election is made and accepted by the Employer with respect to payments to be
made due to a Separation from Service or upon a fixed date, (4) does not cause a payment
that would otherwise be made in the year of the election to be delayed to a later year,
and (5) does not accelerate into the year in which the election is made a payment that is
otherwise scheduled to be made in a later year.  

        4.5    Subsequent
 Payment  Elections.  A Participant may not change his payment  election on or after
January 1, 2009.  

        4.6    Termination
of Deferral Election. The Deferral Election of any Participant whose future
participation in the Plan is terminated by the Committee shall be deemed terminated as of
the first day of the Plan Year following such determination.  

        4.7    Vesting.
 A  Participant  shall be one hundred  percent  (100%)  vested in his/her  Deferred
 Compensation Account at all times. 

        4.8    Withholding.
Any amounts required to be withheld from the Participant’s Deferred Compensation
pursuant to federal, state or local law shall be withheld first from the non-deferred
portion of the Participant’s Compensation and, to the extent necessary, from the
Deferred Compensation. Upon the occurrence of a Payment Event, to the extent required by
law in effect at the time payments are made, the Employer shall withhold from payments
made hereunder any taxes required to be withheld pursuant to federal, state or local law.  

        4.9    Investment
Direction. At any time, a Participant may submit to the Committee a completed
Investment Direction directing investment contributions in his/her Deferred Compensation
Account in either the Fixed Income Fund or the Investment Fund. The Committee shall, as
soon as reasonably possible, implement the investments as directed by the Participant.
Neither the Committee nor the Employer shall be liable for any damages resulting from any
loss in the value to a Participant’s Deferred Compensation Account for implementing
the Investment Direction as soon as reasonably possible. “As soon as reasonably
possible” shall mean at least two (2) business days following the day on which the
Investment Direction is received by the Employer and, may, under the then current
circumstances, constitute an additional period of time. Participants are not permitted to
transfer amounts out of or into the Stock Units Account.  

7 

        4.10    Determination
of Deferred Compensation Account. A Participant’s Deferred Compensation Account
shall consist of an investment in the Fixed Income Fund, if applicable, the Investment
Fund, if applicable, and Stock Units, if applicable. A Participant’s investment in
either the Fixed Income Fund, the Investment Fund or Stock Units shall be maintained and
administered as provided in Sections 4.10(a), (b) and (c) below.  

        (a)    Fixed
Income Fund. A Participant’s investment in the Fixed Income           Fund shall
be calculated as of each Determination Date and shall consist of the           balance of
the Fixed Income Fund as of the most recent Determination Date           credited by an
amount equal to the Deferred Compensation directed by the           Participant to be
invested in the Fixed Income Fund or otherwise required           pursuant to this Plan
to be invested in the Fixed Income Fund since the most           recent Determination
Date. Said Account shall be debited by the amount of any           distributions from
said Account since the most recent Determination Date. After           adjustment as
provided above, interest shall be credited to the Account at the           Declared Rate.  

        (b)    Investment
Fund. At each Determination Date, a Participant’s           investment in the
Investment Fund shall be credited with the amount of Deferred           Compensation
directed by the Participant to be invested in the Investment Fund.           In addition,
a Participant’s investment in the Investment Fund shall be           debited for all
costs, fees or commissions assessed in connection with the           purchase and sale of
securities as directed by Participant.  

        (c)    Stock
Units. Subject to any terms and conditions imposed by the           Committee,
Participants may elect to defer, under the Plan, amounts which would           otherwise
be taxable income of a Participant as a result of the earning, vesting           or such
similar event with respect to Stock-Denominated Awards. In connection           with such
deferral of a Stock-Denominated Award, a Stock Units Account shall be
          established for such Participant. On terms determined by the Committee, the
          Stock Unit Account will, as of the date that taxable income from a
          Stock-Denominated Award would otherwise be recognized by a Participant, be
          credited with a number of share units corresponding to the number of shares of
          Company Stock represented in the amount of the Stock-Denominated Award being
          deferred hereunder. With respect to any fractional shares, the Committee may
          credit the Participant’s Fixed Income Fund Account or Investment Fund
          Account with such amount in lieu of depositing such fractional shares into the
          Stock Units Account. The Stock Units Account (i) may not be diversified, (ii)
          must remain at all times credited with units that represent Company Stock, and
          (iii) must be distributed solely in the form of Company Stock; provided,
          however, that in the event of any change in the outstanding shares of Company
          Stock by reason of any recapitalization, merger, consolidation, spin-off,
          reorganization, combination or exchange of shares or other similar corporate
          change, then the Stock Units Account of each Participant shall be adjusted
          either by the Committee in a reasonable manner to compensate for the change or
          by the agreement executed by the Company or the Bank with respect to such
event,           and any such adjustment shall be conclusive and binding for all purposes
of the           Plan.  

8 

	 	        (i)    Investment
Return. Appreciation and depreciation in value of the Stock                Units
Account shall be equal to the actual appreciation and depreciation of the
               Company Stock.  

	 	        (ii)    Allocation
of Hypothetical Investment. Stock-Denominated Awards deferred                pursuant
to this Plan shall continuously be deemed invested in Stock Units until
               settlement of the Stock Units Account pursuant to Article V hereof, and
the                Participant shall not be entitled to reallocate Stock Units into any
other                investments.  

	 	        (iii)    Voting. Participants
shall not be entitled to vote any Company Stock                underlying either the
Stock-Denominated Awards deferred under the Plan or the                Stock Units held
in their Stock Units Accounts.  

	 	        (iv)    Dividends. If
the Company pays cash dividends or any other cash                distributions with
respect to the Company Stock, then an equivalent amount with                respect to
the Stock Units in a Participant’s Stock Units Account shall be
               credited to the Participant’s Fixed Income Fund Account. If there are
any                stock dividends or stock splits with respect to the Company Stock,
then an                equivalent amount with respect to the Stock Units in a Participant’s
Stock                Units Account shall be credited to the Participant’s Stock
Units Account in                the form of additional Stock Units.  

        4.11    Annual
Reporting. Within one hundred twenty (120) days following the end of each Plan Year,
the Committee shall provide to each Participant a statement setting forth the value as of
the last day of the preceding Plan Year in the Participant’s Deferred Compensation
Account, including the contributions, withdrawals, earnings and losses.  

        4.12    Rabbi
Trust. The Employer may, at any time, in its sole and absolute discretion, transfer a
Participant’s Deferred Compensation Account into a Rabbi Trust then in existence for
the Plan; provided, however, said Trust shall substantially comply with (i) the terms and
provisions of the model Rabbi Trust as set forth in Rev. Proc. 92-64, 1992-2 CB 422
as now existing or as subsequently modified, and (ii) the requirements of Section 409A of
the Code.  

ARTICLE 5.  
PAYMENT OF
DEFERRED COMPENSATION  

        5.1    Payment
Events. Each Participant shall be entitled to payment of deferred compensation equal
to the amount of the vested balance of such Participant’s Deferred Compensation
Account as of the earliest to occur of the following events selected by a Participant on
his Deferral Election form (hereinafter “Payment Event”):  

	 	        (a)              Separation
from Service (as defined in Section 2.26 above),  

	 	        (b)              Death,  

9 

	 	        (c)              Disability
(as defined in Section 2.13 above),  

	 	        (d)              Change
in Control (as defined in Section 2.3 above), or  

	 	        (e)               In-service
distribution as specified on a Deferral Election form.  

        In
addition to the above Payment Events, the Committee may, in its sole and absolute
discretion, allow a Participant to withdraw amounts from his/her Deferred Compensation
Account upon the happening of an Unforeseeable Emergency. A Participant may request a
distribution due to an Unforeseeable Emergency by submitting a written request to the
Committee accompanied by evidence to demonstrate that the circumstances being experienced
qualify as an Unforeseeable Emergency. Any withdrawal approved by the Committee shall not
exceed the amount necessary to meet the Unforeseeable Emergency. 

        5.2    Form
of Payment. Upon initially electing to participate in the Plan, a Participant shall
also select, on the Deferral Election form, the form in which deferred compensation is to
be paid to him/her following a Payment Event. A Participant who is not a Director may
elect to receive payment in a lump sum or in monthly cash (except amounts held in the
Stock Units Account must be distributed in the form of Company Stock) payments over a
period not to exceed one hundred twenty (120) months. A Participant who is a Director may
elect to receive payment in the following forms of payment: (i) a lump sum payment, (ii)
a life annuity, (iii) a joint survivor annuity, or (iv) a monthly payment of a fixed
amount which shall amortize the applicable amount in equal monthly payments of principal
and interest over a period from two (2) to two hundred forty (240) months. The election
may not be altered by the Participant after he/she commences participation in the Plan,
except as set forth in Section 4.4 above. If a Participant fails to elect a form of
payment, the Deferred Compensation shall be paid to him/her in monthly cash payments over
a period of one hundred twenty (120) months if the Participant is not a Director and over
two hundred forty (240) months if the Participant is a Director.  

        5.3    Timing
of Payment Event. Within sixty (60) days after the occurrence of a Payment Event, the
Employer shall commence payment to the Participant or the Participant’s designated
Beneficiary or legal representative, as the case may be, of the Participant’s
Deferred Compensation Account, except as set forth below. The Deferred Compensation
Account balance shall be paid pursuant to Section 5.2 above. Notwithstanding anything in
the Plan to the contrary, if a Participant is deemed to be a Specified Employee at the
time of Separation from Service, then any payments made on account of Separation from
Service will be made or will commence on the first day of the month following the lapse
of six (6) months after the date of the Separation from Service (or, if earlier, upon the
death of a Participant). If payments are to made in monthly installments or in the form
of an annuity and are delayed as set forth in the preceding sentence, then (a) the number
of monthly installments shall remain the same, (b) the amount of the annuity payments
shall be calculated based on the commencement date being the first day of the month
following the lapse of six months after the date of the Separation from Service, and (c)
the installments or annuity payments shall be paid each month, commencing as of the date
set forth in the preceding sentence.  

10 

        5.4    Amount
of Each Monthly Installment. The dollar amount of each monthly installment paid to a
Participant or his or her Beneficiaries shall be determined by multiplying the value of
the Participant’s vested Deferral Account as of the close of business on the day
preceding such payment by a fraction. The numerator of the fraction shall in all cases be
one, and the denominator of the fraction shall be the number of monthly installments
remaining to be paid to the Participant or his or her Beneficiaries, including the
monthly installment for which the calculation is being made. For example, if a
Participant elected to receive 12 annual installments, the amount of the first annual
installment shall be 1/12th of the Participant’s vested Deferral Account,
the second annual installment shall be 1/11th of the then remaining vested
Deferral Account, and so on.  

        5.5    Beneficiary
Designation. Each Participant shall have the right to designate primary and
contingent Beneficiaries to receive any payment which may be payable hereunder following
the Participant’s death. Such beneficiary designation shall be delivered in writing
to the Committee, and may be changed at any time by a subsequent written notice to the
Committee. The last written designation delivered to the Committee prior to the
Participant’s death shall control. Such beneficiary designation shall become
effective only when received by the Committee. If a Participant fails to designate a
Beneficiary, or if his/her Beneficiary designation is revoked by operation of law and
he/she does not designate a new Beneficiary, or if all designated Beneficiaries
predecease the Participant or die prior to complete distribution of the Participant’s
Deferred Compensation Account, remaining payments shall be made to the legal
representative of the Participant’s estate. Any payment of a Participant’s
Deferred Compensation Account in accordance with this Section 5.5 shall release the
Employer from all future liability hereunder.  

ARTICLE 6.  
EMPLOYER
CONTRIBUTIONS  

        6.1    Phantom
401(k) Contributions. The Employer shall conditionally contribute into a Participant’s
Deferred Compensation Account on the Contribution Date or at such other date pursuant to
the Employer’s 401(k) plan an amount equal to the sum which the Employer would
otherwise contribute into the Participant’s 401(k) account with respect to said
Deferred Compensation assuming the Participant had not deferred any Compensation (“Phantom 401(k)
Contribution”). The amount of a Phantom 401(k) Contribution shall be in accordance
with the Employer’s 401(k) plan as of the date of the deferral, including any
applicable vesting schedule with respect to said 401(k) contribution.  

        6.2    Phantom
ESOP Contribution. The Employer shall conditionally contribute into a Participant’s
Deferred Compensation Account on the Contribution Date or at such other date in
accordance with the Employer’s Employee Stock Ownership Plan (the “ESOP”)
an amount equal to the sum which the Employer would otherwise contribute into the ESOP
with respect to said Deferred Compensation assuming the Participant had not deferred any
Compensation (“Phantom ESOP Contribution”). The amount of the Phantom ESOP
Contribution and any vesting with respect to said contribution shall be in accordance
with the terms and provisions of the Employer’s ESOP as of the time of said
contribution.  

        6.3    Investment
of Phantom 401(k) Contribution and Phantom ESOP Contribution. Any Phantom 401(k)
Contribution and/or Phantom ESOP Contribution made to a Participant’s Deferred
Compensation Account shall be invested as directed by a Participant pursuant to this
Plan.  

11 

ARTICLE 7.  
CLAIM
PROCEDURE  

        7.1    
Scope of Claims Procedures. This Article is based on final regulations issued by
the Department of Labor and published in the Federal Register on November 21, 2000 and
codified at 29 C.F.R. Section 2560.503-1. If any provision of this Article conflicts with
the requirements of those regulations, the requirements of those regulations will prevail. 

        7.2    
Initial Claim. The Participant or any beneficiary who believes he or she is
entitled to any benefit under the Plan (a “Claimant”) may file a claim with the
Employer within one hundred eighty (180) days of the date on which the event that caused
the claim to arise occurred. The Employer shall review the claim itself or appoint an
individual or an entity to review the claim. 

            (a)    Initial
Decision. The Claimant shall be notified within ninety (90) days           after the
claim is filed whether the claim is allowed or denied, unless the           Claimant
receives written notice from the Employer or appointee of the Employer           prior to
the end of the ninety (90) day period stating that special           circumstances
require an extension of the time for decision, such extension not           to extend
beyond the day which is one hundred eighty (180) days after the day           the claims
is filed.  

            (b)    Manner
and Content of Denial of Initial Claims. If the Employer denies a           claim, it
must provide to the Claimant, in writing or by electronic           communication:  

	 	(i) 	The
specific reasons for the denial;  

	 	(ii) 	A
reference to the provision of the Plan upon which the denial is based;  

	 	(iii) 	A
description of any additional information or material that the Claimant must
          provide in order to perfect the claim;  

	 	(iv) 	An
explanation of why such additional material or information is necessary;  

	 	(v) 	Notice
that the Claimant has a right to request a review of the claim denial and
          information on the steps to be taken if the Claimant wishes to request a review
          of the claim denial; and  

	 	(vi) 	A
statement of the Participant’s right to bring a civil action under           Section
502(a) of ERISA following a denial on review of the initial denial.  

12 

        7.3    Review
Procedures.  

            (a)    Request
For Review. A request for review of a denied claim must be made           in writing
to the Employer within sixty (60) days after receiving notice of           denial. The
decision upon review will be made within sixty (60) days after the           Employer’s
receipt of a request for review, unless special circum stances           require an
extension of time for processing, in which case a decision will be           rendered not
later than one hundred twenty (120) days after receipt of a request           for review.
A notice of such an extension must be provided to the Claimant           within the
initial sixty (60) day period and must explain the special           circumstances and
provide an expected date of decision.  

            The
reviewer shall afford the Claimant an opportunity to review and receive, without charge,
all relevant documents, information and records and to submit issues and comments in
writing to the Employer. The reviewer shall take into account all comments, documents,
records and other information submitted by the Claimant relating to the claim regardless
of whether the information was submitted or considered in the initial benefit
determination. 

            (b)    Manner
and Content of Notice of Decision on Review. Upon completion of           its review
of an adverse claim determination, the Employer will give the           Claimant, in
writing or by electronic notification, a notice containing:  

	 	(i) 	its
decision;  

	 	(ii) 	the
specific reasons for the decision;  

	 	(iii) 	the
relevant provisions of the Plan on which its decision is based;  

	 	(iv) 	a
statement that the Claimant is entitled to receive, upon request and without
          charge, reasonable access to, and copies of, all documents, records and other
          information in the Employer’s files which is relevant to the
          Claimant’s claim for benefits;  

	 	(v) 	a
statement describing the Claimant’s right to bring an action for judicial
          review under Section 502(a) of ERISA; and  

	 	(vi) 	if
an internal rule, guideline, protocol or other similar criterion was relied
          upon in making the adverse determination on review, a statement that a copy of
          the rule, guideline, protocol or other similar criterion will be provided
          without charge to the Claimant upon request.  

        7.4    
Calculation of Time Periods. For purposes of the time periods specified in this
Article, the period of time during which a benefit determination is required to be made
begins at the time a claim is filed in accordance with the procedures herein without
regard to whether all the information necessary to make a decision accompanies the claim.
If a period of time is extended due to a Claimant’s failure to submit all information
necessary, the period for making the determination shall be tolled from the date the
notification is sent to the Claimant until the date the Claimant responds. 

13 

        7.5    
Legal Action. If the Employer fails to follow the claims procedures required by
this Article, a Claimant shall be deemed to have exhausted the administrative remedies
available under the Plan and shall be entitled to pursue any available remedy under
Section 502(a) of ERISA on the basis that the Plan has failed to provide a reasonable
claims procedure that would yield a decision on the merits of the claim. A Claimant’s
compliance with the foregoing provisions of this Article is a mandatory requisite to a
Claimant’s right to commence any legal action with respect to any claims for benefits
under the Plan. 

        7.6    
Review by the Employer. Notwithstanding anything in this Plan to the contrary, the
Employer may determine, in its sole and absolute discretion, to review any claim for
benefits submitted by a Claimant under this Agreement. 

ARTICLE 8.
 
MISCELLANEOUS  

        8.1    Amendment
and Termination of the Plan. The Board of Directors of the Employer may at any time
amend the Plan, provided that no such action shall deprive any Participant, former
Participant or Beneficiary of any payment of Deferred Compensation to which the
Participant, former Participant or Beneficiary may have been entitled under the Plan
prior to the effective date of such action. Any Employer may terminate its participation
in the Plan at any time following termination of the Plan, and payment of the Deferred
Compensation shall be made in accordance with the provisions of Article 5, except as set
forth in Section 8.2(b) below. Notwithstanding anything in the Plan to the contrary, the
Board of Directors of the Employer may amend in good faith any terms of the Plan or the
Deferral Election form, including retroactively, in order to comply with Section 409A of
the Code.  

        8.2    Effect
of Amendment or Termination.  

            (a)    General.
No amendment or termination of the Plan shall directly or           indirectly reduce the
vested portion of any account held hereunder as of the           effective date of such
amendment or termination. A termination of the Plan will           not be a distributable
event, except in the three circumstances set forth in           Section 8.2(b) below. No
additional deferrals shall be made to the account of a           Participant, but the
Employer shall continue to credit gains and losses pursuant           to Section 4.10
until the balance of the Participant’s account has been           fully distributed
to the Participant or his beneficiary.  

            (b)    Termination.
Under no circumstances may the Plan permit the acceleration           of the time or form
of any payment under the Plan prior to the payment events           specified herein,
except as provided in this Section 8.2(b). The Employer may,           in its discretion,
elect to terminate the Plan in any of the following three           circumstances and
accelerate the payment of the entire unpaid balance of the           Participant’s
vested benefits as of the date of such payment in accordance           with Section 409A
of the Code:  

14 

	 	(i) 	the
Plan is irrevocably terminated within the 30 days preceding a Change in           Control
and (1) all arrangements sponsored by the Employer that would be           aggregated
with the Plan under Treasury Regulation §1.409A-1(c)(2) are           terminated,
and (2) the Participant and all participants under the other           aggregated
arrangements receive all of their benefits under the terminated           arrangements
within 12 months of the date the Employer irrevocably take all           necessary action
to terminate the Plan and the other aggregated arrangements;  

	 	(ii) 	the
Plan is irrevocably terminated at a time that is not proximate to a downturn           in
the financial health of the Employer and (1) all arrangements sponsored by           the
Employer that would be aggregated with the Plan under Treasury Regulation
          1.409A-1(c) if the Participant participated in such arrangements are
terminated,           (2) no payments are made within 12 months of the date the Employer
take all           necessary action to irrevocably terminate the arrangements, other than
payments           that would be payable under the terms of the arrangements if the
termination had           not occurred, (3) all payments are made within 24 months of the
date the           Employer take all necessary action to irrevocably terminate the
arrangements,           and (4) the Employer does not adopt a new arrangement that would
be aggregated           with the Plan under Treasury Regulation 1.409A-1(c) if a
Participant           participated in both arrangements, at any time within three years
following the           date the Employer takes all necessary action to irrevocably
terminate the Plan;           or  

	 	(iii) 	the
Plan is terminated within 12 months of a corporate dissolution taxed under
          Section 331 of the Code, or with the approval of a bankruptcy court pursuant to
          11 U.S.C. §503(b)(1)(A), provided that the amounts deferred by a
          Participant under the Plan are included in the Participant’s gross income
          in the later of (1) the calendar year in which the termination of the Plan
          occurs, or (2) the first calendar year in which the payment is administratively
          practicable.” 

        8.3    Status
of Participants.The Plan constitutes a mere promise by the Employer to pay Deferred
Compensation to Participants, former Participants or Beneficiaries in the future. The
right of a Participant, former Participant or Beneficiary to receive a payment of
Deferred Compensation hereunder shall be an unsecured claim against the general assets of
the applicable Employer, and neither the Participant, former Participant nor any
Beneficiary shall have any rights in or against any specific assets of the Employer.
Neither the Plan nor any action taken under the Plan shall be construed as giving any
employee any right to be retained in the employ of the Employer or any affiliate of the
Employer.  

        8.4    Limitation
on Alienation.A Participant’s right to receive payments under this Plan is not
subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance, attachment or garnishment by creditors of the Participant or the Participant’s
Beneficiary.  

15 

        8.5    Pronouns.
Whenever used in this Plan, the singular form shall mean or include the plural form,
where applicable, and vice versa.  

        8.6    Applicable
 Law.  This Plan shall be  construed  in  accordance  with  applicable  federal law
and, to the extent otherwise applicable, the laws of the State of Nebraska. 

        8.7    Severability.
If any provisions of this Plan shall be held invalid or unenforceable, the remaining
provisions of the Plan shall continue to be fully effective.  

        8.8    Successors.
The provisions of this Plan shall bind and inure to the benefit of the Employer and its
respective successors and assigns. The term successors as used herein shall include any
corporate or other business entity which shall, whether by merger, consolidation,
purchase or otherwise, acquire all or substantially all of the business and assets of the
Employer, and successors of any such corporation or other business entity.  

[The remainder of this
page has been left intentionally blank.]  

16 

        IN
WITNESS WHEREOF, TierOne Bank has adopted this amended and restated Plan as of the
20th day of December 2007, pursuant to the authority granted by the Board on
December 20, 2007. 

		TIERONE BANK
	
 	By:  /s/ Gilbert G. Lundstrom
		        Gilbert G. Lundstrom
	
 	Its: Chairman and Chief Executive Officer

17

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