AMENDMENT NO. 2 to CREDIT AGREEMENT

Exhibit 10.1

AMENDMENT NO. 2

to

CREDIT AGREEMENT

THIS AMENDMENT NO. 2 to Credit Agreement (this “Amendment”), dated as of June 24, 2015, is entered into by and among Rightside Group, Ltd., a Delaware corporation (“Borrower Parent”), Rightside Operating Co., a Delaware corporation (“Opco”), Enom, Incorporated, a Nevada corporation (“eNom,” and together with Borrower Parent and Opco, the “U.S. Borrowers”), DMIH Limited, a limited liability company organized under the laws of Ireland (“DMIH”), United TLD Holdco Ltd., an exempted company limited by shares incorporated under the laws of the Cayman Islands (“United”), Rightside Domains Europe Limited, a limited liability company organized under the laws of Ireland (“Domains,” and together with DMIH and United, the “Non-U.S. Borrowers”), and Silicon Valley Bank (“SVB”), as Lender (in such capacity, the “Lender”). Each of the U.S. Borrowers and the Non-U.S. Borrowers is a “Borrower,” and collectively, they are the “Borrowers.”

PRELIMINARY STATEMENTS

Whereas, the Borrowers and the Lender are parties to that certain Credit Agreement, dated as of August 1, 2014 (as amended, restated, or otherwise modified from time to time, the “Credit Agreement”). Capitalized terms used herein and not otherwise defined shall have the meanings ascribed to them in the Credit Agreement.

Whereas, the Borrower has requested certain modifications to the Credit Agreement related to the Consolidated Fixed Charge Coverage Ratio.

Whereas, the Borrowers and the Lender have agreed to amend the Credit Agreement on the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the premises set forth above and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

Section 1.Amendments to the Credit Agreement.

A.Section  7.1(a) (Consolidated Fixed Charge Coverage Ratio) is hereby amended in its entirety to read as follows:

“Permit the Consolidated Fixed Charge Coverage Ratio as at the last day of each fiscal quarter of the Borrower to be less than the ratio set forth opposite the level of Borrowers’ unrestricted cash and unused Availability for such date.

(a)Exhibit B (Compliance Certificate) to the Credit Agreement is amended in its entirety as set forth in Exhibit A attached hereto.

(b)Conditions.  This Amendment shall become effective as of the date first above written (the “Effective Date”), upon receipt by the Lender of each of the following:

(c)a duly executed counterpart of this Amendment executed by each of the parties hereto; and

(d)reimbursement by Borrowers of all of Lender’s reasonable expenses related to the preparation and execution of this Amendment.

Section 2.Covenants, Representations, and Warranties of the Borrowers.  

(a)Each of the Borrowers represents and warrants as to itself that, after giving effect to this Amendment, its representations and warranties set forth in the Credit Agreement (as amended hereby) and the other Loan Documents are true and correct as of the date hereof, as though made on and as of such date (except to the extent such representations and warranties relate solely to an earlier date and then as of such earlier date).

(b)Each of the Borrowers represents and warrants as to itself that (i) this Amendment constitutes the legal, valid, and binding obligation of such party, enforceable against such party in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium, or similar laws affecting the enforcement of creditors’ rights generally and general principles of equity; and (ii) upon the effectiveness of this Amendment, no event shall have occurred and be continuing which constitutes a Default or an Event of Default.

Section 3.Reference to and Effect on the Credit Agreement.

(a)Upon the effectiveness of this Amendment, each reference in the Credit Agreement to “this Agreement,” “hereunder,” “hereof,” “herein,” “hereby,” or words of like

import shall mean and be a reference to the Credit Agreement as amended by this Amendment, and each reference to the Credit Agreement in any other document, instrument, or agreement executed or delivered in connection with the Credit Agreement shall mean and be a reference to the Credit Agreement as amended by this Amendment.

(b)Except as specifically amended hereby, the Credit Agreement and each other Loan Document shall remain in full force and effect and are hereby ratified and confirmed.

(c)The execution, delivery, and effectiveness of this Amendment shall not operate as a waiver of any right, power, or remedy of the Lender under the Credit Agreement or any of the other Loan Documents, nor constitute a waiver of any provision contained therein, except as specifically set forth herein.

Section 4.Expenses. The Borrowers agree to pay all reasonable expenses, including without limitation attorney fees, incurred by the Lender in connection with the preparation, execution, and enforcement of this Amendment.

Section 5.GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF CALIFORNIA, WITHOUT GIVING EFFECT TO CONFLICTS OF LAW PRINCIPLES.

Section 6.Counterparts. This Amendment may be executed in any number of separate counterparts, each of which shall be deemed an original. All of such counterparts taken together shall constitute one and the same instrument. Delivery of an executed signature page to this Amendment by electronic mail or facsimile shall be effective as physical delivery.

Section 7.Headings. Section headings in this Amendment are included herein for convenience of reference only and shall not constitute a part of this Amendment for any other purpose.

Section 8.Integration.  This Amendment contains the entire understanding of the parties hereto with regard to the subject matter contained herein. This Amendment supersedes all prior or contemporaneous negotiations, promises, covenants, agreements, and representations with respect to the matters referred to in this Amendment, all of which have become merged and finally integrated into this Amendment. Each of the parties hereto understands that in the event of any subsequent litigation, controversy or dispute concerning any of the terms, conditions, or provisions of this Amendment, no party shall be entitled to offer or introduce into evidence any oral promises or oral agreements between the parties relating to the subject matter of this Amendment not included or referred to herein and not reflected by a writing included or referred to herein.

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed and delivered by their respective duly authorized signatories, as of the date first above written.

EXHIBIT A

FORM OF COMPLIANCE CERTIFICATE

RIGHTSIDE GROUP, LTD.

Date:  ___________ ____, 20____

This Compliance Certificate is delivered pursuant to Section 6.2(b)(ii) of that certain Credit Agreement, dated as of August 1, 2014, by and among Rightside Group, Ltd., a Delaware corporation (“Borrower Parent”), Rightside Operating Co., a Delaware corporation (“Opco”), eNom, Incorporated, a Nevada corporation (“eNom” and with Borrower Parent and Opco, the “U.S. Borrowers”), DMIH Limited, a limited liability company organized under the laws of Ireland (“DMIH”), United TLD Holdco Ltd., an exempted company limited by shares incorporated under the laws of the Cayman Islands (“United”), Rightside Domains Europe Limited, a limited liability company organized under the laws of Ireland (“Domains” and with DMIH and United, the “Non-U.S. Borrowers”) (the U.S. Borrowers and the Non-U.S. Borrowers are collectively referred to as “Borrowers” and each individually, a “Borrower”), and Silicon Valley Bank (“SVB”), as Lender (in such capacity, “Lender”) (as amended, restated, amended and restated, supplemented, restructured or otherwise modified from time to time, the “Credit Agreement”).  Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

1.I am the duly elected (or appointed), qualified and acting [Insert title of applicable Responsible Officer] of Borrower Parent.

2.I have reviewed and am familiar with the contents of this Compliance Certificate.

3.I have reviewed the terms of the Credit Agreement and the other Loan Documents and have made, or caused to be made under my supervision, a review in reasonable detail of the transactions and condition of Borrower Parent and its Subsidiaries during the accounting period covered by the financial statements attached hereto as Attachment 1 (the “Financial Statements”).  Such review did not disclose, and I have no knowledge of the existence as of the date of this Compliance Certificate, of any condition or event which constitutes a Default or an Event of Default[, except as specified below].

4.Attached hereto as Attachment 2 are the computations showing compliance with the covenants set forth in Section 7.1 of the Credit Agreement and the U.S. Revolving Loan Sublimit for the referenced period.

5.The amount of Permitted gTLD Investments made during the most recent fiscal quarter is $___________, and the aggregate of all Permitted gTLD Investments made since the Closing Date is $______________. 

6.[To the extent not previously disclosed to Lender, a description of any change in the jurisdiction of organization of any Loan Party is attached hereto as Attachment [3].]

7.[To the extent not previously disclosed to Lender, a list of any registered Intellectual Property issued to or acquired by any Loan Party since [the Closing Date][the date of the most recent report delivered] is attached hereto as Attachment [4].]

8.[To the extent not previously disclosed to Lender, a list of Subsidiaries created or acquired, since [the Closing Date][the date of the most recent report delivered] is attached hereto as Attachment [5].]

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IN WITNESS WHEREOF, I have executed this Compliance Certificate as of the date first written above.

Attachment 1
to Compliance Certificate

[Attach Financial Statements]

Attachment 2
to Compliance Certificate

The information described herein is as of [____________], [____] (the “Statement Date”), and pertains to the Subject Period defined below, as applicable.1

1 NTD: Financial Definitions and tests to be conformed to final definitions and tests in the Credit Agreement.

2 For Lines I.A.2 through I.A.15, include only to the extent deducted in the calculation of Consolidated Net Income in Line I.A.1.

3 For Lines I.A.16 through I.A.20, include only to the extent included in the calculation of Consolidated Net Income in Line I.A.1.

4 Consolidated EBITDA shall be calculated on a Pro Forma Basis with respect to any period for which a Permitted Disposition or an acquisition that is a Permitted gTLD Investment has occurred.

5 For Lines V.A.2 through V.A.15, include only to the extent deducted in the calculation of Consolidated Net Income in Line V.A.1.

6 For Lines V.A.16 through V.A.20, include only to the extent included in the calculation of Consolidated Net Income in Line V.A.1.

7 Consolidated Domestic EBITDA shall be calculated on a Pro Forma Basis with respect to any period for which a Permitted Disposition or an acquisition that is a Permitted gTLD Investment has occurred.

Attachment [3][4][5]

to Compliance Certificate

[Attach [description of change in jurisdiction of organization][list of registered Intellectual Property issued to or acquired by a Loan Party][list of Subsidiaries created or acquired]