Asset Purchase Agreement

Exhibit 10.1

Asset Purchase Agreement

among

Local.com Corporation as Buyer,

LiveDeal, Inc. as Parent

And

Telco Billing, Inc. as Seller

March 9, 2009

List of Exhibits and Schedules

ASSET PURCHASE AGREEMENT

     THIS ASSET PURCHASE AGREEMENT (the “ Agreement ”) is made and entered into as of March 9, 2009 by and between Local.com Corporation, a Delaware corporation (“ Buyer ”), LiveDeal, Inc., a Nevada corporation (“ Parent ”), and Telco Billing, Inc., a Nevada corporation (“ Seller ”). Each of Buyer, Parent and Seller is a “ Party ,” and collectively, “ Parties .”

RECITALS

     A. Seller is in the business (the “ Business ”) of providing online classifieds and online yellow pages to advertisers (“ Subscribers ”).

     B. Seller desires to sell, and Buyer desires to purchase, certain Subscribers of Seller set forth in Exhibit A attached hereto (the “ Purchased Subscribers ”).

     C. Seller and Buyer previously entered into that certain Escrow Agreement (the “ Breakup Escrow Agreement ”) dated January 30, 2009, pursuant to which Buyer deposited $250,000.00 (the “ Breakup Escrow Fund ”) into escrow as either (i) a breakup fee if the Parties failed to consummate the contemplated transaction under certain circumstances, or (ii) as a portion of the purchase price in the event the Parties successfully consummated the contemplated transactions.

AGREEMENT

     In consideration of the mutual covenants and promises set forth herein, Buyer and Seller agree as follow:

ARTICLE 1
DEFINITIONS

     1.1 Defined Terms . Unless otherwise expressly provided in this Agreement, the following terms, whether in singular or plural form, shall have the following meanings:

     “ Affiliate ” means, with respect to any Person, any other Person controlled by or under common control with such Person, with “control” for such purpose meaning the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities or voting interests, by contract or otherwise.

     “ Consents” means all of the consents, permits or approvals of third parties (excluding the Purchased Subscribers themselves) necessary to transfer the Purchased Subscribers to Buyer (or, at Buyer’s request, to an affiliate of Buyer) or otherwise to consummate lawfully the transactions contemplated hereby.

     “ Contracts” means all subscriber agreements and other agreements, written or oral (including any amendments and other modifications thereto) to which Seller is a party and that affect the Purchased Subscribers.

     “ Governmental Authority” means the United States of America, any state, commonwealth, territory, or possession thereof and any political subdivision or quasi-governmental authority of any of the same.

     “ Judgment” means any judgment, writ, order, injunction, award or decree of any court, judge, justice or magistrate, including any bankruptcy court or judge, and any order of or by any Governmental Authority.

     “ Knowledge”: an individual will be deemed to have “ Knowledge ” of a particular fact or other matter if:

          (a) such individual is actually aware of such fact or other matter; or

          (b) a prudent individual could be expected to discover or otherwise become aware of such fact or other matter in the course of conducting a reasonably comprehensive investigation concerning the existence of such fact or other matter.

     A Person (other than an individual) will be deemed to have “ Knowledge ” of a particular fact or other matter if any individual who is serving, or who has at any time served, as a director, officer, partner, executor, or trustee of such Person (or in any similar capacity) has, or at any time had, Knowledge of such fact or other matter.

     “ Legal Requirements” means applicable common law and any statute, ordinance, code or other law, rule, regulation, order, technical or other standard, requirement or procedure enacted, adopted, promulgated, applied or followed by any Governmental Authority, including Judgments.

     “ Licenses” means all authorizations and permits relating to the Purchased Subscribers granted to Seller by any Governmental Authority.

     “ Lien” means any security agreement, financing statement filed with any Governmental Authority, conditional sale or other title retention agreement, any lease, consignment or bailment given for purposes of security, any lien, mortgage, indenture, pledge, option, encumbrance, adverse interest, constructive trust or other trust, claim, attachment, exception to or defect in title or other ownership interest of any kind, which otherwise constitutes an interest in or claim against property, whether arising pursuant to any Legal Requirement, Contract or otherwise but which shall not include any rights to payment or obligations imposed upon Buyer as a result of this Agreement or any ancillary documents.

     “ Litigation” means any claim, action, suit, proceeding, arbitration, investigation, hearing or other activity or procedure that could result in a Judgment, and any notice of any of the foregoing.

     “ Losses” means, on a dollar-for-dollar basis, any claims, losses, liabilities, damages, Liens, penalties, costs, and expenses, including but not limited to interest which may be imposed in connection therewith, expenses of investigation, reasonable fees and disbursements of counsel

and other experts, and the cost to any Person making a claim or seeking indemnification under this Agreement with respect to funds expended by such Person by reason of the occurrence of any event with respect to which indemnification is sought, but in no event shall “Losses” include incidental or consequential damages.

     “ Material Adverse Change ” means, with respect to Seller, an event that would either individually or in the aggregate, reasonably be expected to have a material adverse change on the Business or the Purchased Subscribers, or the results of operations or financial condition of the Business or the Purchased Subscribers sold hereunder, other than any change or condition relating to the economy in general, or the industries in which Seller operates in general, and not specifically relating to Seller.

     “ Organizational Documents ” shall mean (a) the articles or certificate of incorporation and the bylaws of a corporation; (b) the partnership agreement and any statement of partnership of a general partnership; (c) the limited partnership agreement and the certificate of limited partnership of a limited partnership; (d) the operating agreement and the certificate of formation of a limited liability company; (e) any charter or similar document adopted or filed in connection with the creation, formation, or organization of a Person; and (f) any amendment to any of the foregoing.

     “ Person” means any natural person, Governmental Authority, corporation, general or limited partnership, limited liability company, joint venture, trust, association or unincorporated entity of any kind.

     “ Taxes” means all levies and assessments of any kind or nature imposed by any Governmental Authority, together with any interest thereon and any penalties, additions to tax or additional amounts applicable thereto.

     “ Transaction Documents” means all instruments and documents executed and delivered by Buyer, Seller, or any officer, director or Affiliate of either of them, in connection with this Agreement.

     1.2 List of Additional Definitions . The following is a list of additional terms used in this Agreement and a reference to the Section hereof in which such term is defined:

     1.3 Rules of Construction . Unless otherwise expressly provided in this Agreement, (i) words used in this Agreement, regardless of the gender used, shall be deemed and construed to include any other gender, masculine, feminine, or neuter, as the context requires; (ii) the word “including” is not limiting, and the word “or” is not exclusive; (iii) the capitalized term “Section” refers to sections of this Agreement; (iv) references to a particular Section include all subsections thereof, (v) references to a particular statute or regulation include all amendments thereto, rules and regulations thereunder and any successor statute, rule or regulation, or published clarifications or interpretations with respect thereto, in each case as from time to time in effect; (vi) references to a Person include such Person’s successors and assigns to the extent not prohibited by this Agreement; and (vii) references to a “day” or number of “days” shall be interpreted as a reference to a calendar day or number of calendar days.

ARTICLE 2
PURCHASE AND SALE

     2.1 Purchase and Sale of Assets . Subject to the terms and conditions set forth in this Agreement, at Closing, Seller shall transfer to Buyer, and Buyer shall acquire from Seller, free and clear of all Liens, the following described assets and properties, tangible and intangible, used by or useful to Seller in its operation of, or otherwise relating to, the Purchased Subscribers (the “ Assets ”):

     (a) subject to Section 2.7 , all rights, benefits and interests of Seller in, under or pursuant to all Contracts (provided that all receivables and revenues related to or generated from billings related to services provided by Parent or Seller prior to the Closing shall not be deemed an Asset and shall be retained by Seller), including all revisions or amendments thereto, and Licenses;

     (b) the customer database and history related to each Purchased Subscriber, including without limitation any and all data, indexes and content contained in such database, and any copyrights thereto; and

     (c) all books and records relating to the Purchased Subscribers, subject to the right of Seller to have such books and records made available to Seller for a reasonable period, not to exceed three years from the Closing Date.

     2.2 Assumed Obligations and Liabilities; Retained Liabilities . After the Closing, Buyer shall assume, pay, discharge, and perform all obligations and liabilities arising after the Closing that are related to the Assets or arise from or under (i) Buyer’s or its Affiliates’ use of the Assets or provision of services to the Purchased Subscribers, or (ii) the Contracts (collectively, the “ Assumed Obligations and Liabilities ”). All obligations and liabilities arising out of or relating to the Assets other than the Assumed Obligations and Liabilities shall remain and be the obligations and liabilities solely of Seller (collectively, the “ Retained Liabilities ”).

     2.3 Purchase Price; Final Format Data; TPV Recordings; Purchase Price Adjustment .

     (a) Purchase Price . Buyer shall pay to Parent $3,092,330 (the “ Purchase Price ”), which amount is based upon the transfer of 14,185 Purchased Subscribers (comprised of approximately 3,000 current Subscribers (billed in the same month) and approximately 11,185 previous Subscribers (billed in arrears)). The Purchase Price is payable as set forth below.

     (i) At the Closing, Buyer shall pay to Seller by wire transfer to the account and pursuant to the instructions set forth on Schedule 2.3(a)(i) an amount equal to (i) the Purchase Price minus (ii) the Breakup Escrow Fund minus (iii) the Seller Escrow Deposit.

     (ii) At the Closing, Buyer shall release the Breakup Escrow Fund to Parent by issuing a joint written instruction with Parent instructing the escrow agent under the Breakup Escrow Agreement to release the Breakup Escrow Fund to Parent.

     (iii) At the Closing, Buyer shall deposit the Seller Escrow Deposit with Escrow Agent pursuant to Section 2.4 .

     (b) Final Format Data . At the Closing, Buyer shall provide to Seller data relating to at least 12,909 Purchased Subscribers in final format as set forth in Exhibit 2.3(b) (the “ Final Format Data ”).

     (c) TPV Recordings . On or before the date 7 days after the Closing, Seller shall provide to Buyer a copy of all third-party-verification recordings (“ TPV Recordings ”) for each of the Purchased Subscribers. If TPV Recordings are not available for Purchased Subscribers billed prior to the Closing via BSG Clearing Solutions clearinghouse, such Purchased Subscribers shall not be acquired by Buyer and the Purchase Price shall be adjusted pursuant to Section 2.3(d) . If TPV Recordings are stored at a third party location, Seller shall provide Buyer with access to the third party location for a period of twelve months after the Closing.

     (d) Purchase Price Adjustment . Promptly after the Closing, Buyer and Seller shall mutually determine the actual number of Purchased Subscribers transferred to Buyer. If the number of Purchased Subscribers transferred to Buyer is less than 14,343, then Seller shall deliver a written instruction to Escrow Agent within five business days of Closing instructing Escrow Agent to release to Buyer from the Seller Escrow Deposit an amount equal to $218.00 per Purchased Subscriber for the deficiency and the Purchase Price shall be reduced accordingly. For purposes of determining the number of Purchased Subscribers transferred to Buyer for this Section 2.3(d) , a Purchased Subscriber shall be deemed to have been transferred to Buyer only if (i) such Purchased Subscriber was billed by Seller in the most recent month prior to the Closing and Seller was not aware of anything which would reasonably lead Seller to believe that the amount billed to such Purchased Subscriber on such bill was uncollectible and (ii) Seller has not received a written or telephonic notice from or on behalf of such Purchased Subscriber indicating that such Purchased Subscriber intends to cancel or has cancelled.

     2.4 Seller Escrow Fund . At the Closing, Buyer shall deposit $309,233 (the “ Seller Escrow Deposit ”) into an escrow account with Alliance Bank of Arizona (the “ Escrow Agent ”) under an Escrow Agreement in the form attached hereto as Exhibit B executed and delivered by Seller, Parent, Buyer and Escrow Agent (the “ Seller Fund Escrow Agreement ”). Seller and Buyer shall each pay one-half of the fees and expenses of the Escrow Agent in connection with the administration of the Seller Fund Escrow Agreement. Buyer shall be entitled to seek indemnification for any Losses for which it is entitled to be indemnified pursuant to Section 7.1 by making a claim to Escrow Agent, as evidenced by joint instructions to be given by Buyer and Parent in accordance with the Seller Fund Escrow Agreement, for payment from the Seller Escrow Deposit. On the date nine months after the Closing Date, Parent and Buyer shall jointly

instruct the Escrow Agent to disburse to Seller the entire Seller Escrow Deposit, plus any accrued interest, less (a) any amounts disbursed by Escrow Agent in payment of claims made by Buyer and (b) any amounts subject to claims made by Buyer but not disbursed by Escrow Agent (which amounts shall continue to be held by Escrow Agent until disbursed in accordance with the terms of the Seller Fund Escrow Agreement). The Seller Escrow Deposit shall not constitute the limit of Seller’s liability to Buyer, and Buyer shall retain all indemnification rights and remedies pursuant to Article 7 in this Agreement.

     2.5 Buyer Escrow Fund . At the Closing, Buyer shall deposit $50,000 into an escrow account (the “ Buyer Escrow Deposit ”) with the Escrow Agent under an Escrow Agreement in the form attached hereto as Exhibit C executed and delivered by Seller, Parent, Buyer and Escrow Agent at the Closing (the “ Buyer Fund Escrow Agreement ”). Seller and Buyer shall each pay one-half of the fees and expenses of the Escrow Agent in connection with the administration of the Buyer Fund Escrow Agreement. Seller shall be entitled to seek indemnification for any Losses for which it is entitled to be indemnified pursuant to Section 7.2 by making a claim to Escrow Agent, as evidenced by joint instructions to be given by Buyer and Parent in accordance with the Buyer Fund Escrow Agreement, for payment from the Buyer Escrow Deposit. On the date 120 days after the Closing Date (the “ Buyer Fund Escrow Termination Date ”), Parent and Buyer shall jointly instruct the Escrow Agent to disburse to Buyer the entire Buyer Escrow Deposit, plus any accrued interest, less (a) any amounts disbursed by Escrow Agent in payment of claims made by Parent or Seller and (b) any amounts subject to claims made by Parent or Seller but not disbursed by Escrow Agent (which amounts shall continue to be held by Escrow Agent until disbursed in accordance with the terms of the Buyer Fund Escrow Agreement). The Buyer Escrow Deposit shall not constitute the limit of Buyer’s liability to Parent and Seller, and Parent and Seller shall retain all indemnification rights and remedies pursuant to Article 7 in this Agreement.

     2.6 Credits Processed by LECs or Clearinghouses .

     (a) Credits processed by LECs or clearinghouses shall be the responsibility of the Party who submitted the original billing to the LEC or clearinghouse, as applicable.

     (i) During the period from the Closing until the Buyer Fund Escrow Termination Date, on the last day of each calendar month and on the Buyer Fund Escrow Termination Date, Buyer will provide to Seller a report listing all credits processed in error against Buyer’s settlements or as an adjustment to reserves by LECs or clearinghouses, as applicable, and the total amount owed to Buyer by Seller. Buyer and Seller shall then promptly jointly instruct the Escrow Agent to disburse to Buyer such amount from the Seller Escrow Deposit. Following the Buyer Fund Escrow Termination Date, Buyer cannot make any claim against Seller for credits processed in error related to Purchased Subscribers.

     (ii) During the period from the Closing until the Buyer Fund Escrow Termination Date, on the last day of each calendar month and on the Buyer Fund Escrow Termination Date, Seller will provide to Buyer a report listing all credits processed in error against Seller’s settlements or as an adjustment to reserves by

LECs or clearinghouses, as applicable, and the total amount owed to Seller by Buyer. Buyer and Seller shall then promptly jointly instruct the Escrow Agent to disburse to Seller such amount from the Buyer Escrow Deposit. Following the Buyer Fund Escrow Termination Date, Seller cannot make any claim against Buyer for credits processed in error related to Purchased Subscribers.

     (b) If Buyer or its Affiliates receives a refund request from a Purchased Subscriber related to services provided by Seller prior to Closing, Buyer shall only transfer such Purchased Subscriber to Seller at phone number for the aggregator for that customer set forth in Schedule 2.6(b) and make no commitment regarding issuing a refund. Buyer and its Affiliates shall not make any other statement or suggestion to such Purchased Subscriber.

     2.7 Assignability and Consents.

     (a) Required Consents . Schedule 2.7 sets forth a list of all Contracts and Licenses which are non-assignable or non-transferable to Buyer without the consent of some other Person. Seller has taken or caused to be taken by others, all commercially reasonable actions to obtain or satisfy all Consent