Exhibit 4.15
COMMON STOCK WARRANT
NEITHER THIS WARRANT NOR THE
SECURITIES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. NO SALE OR
DISPOSITION OF THIS WARRANT OR THE SHARES FOR WHICH THIS WARRANT IS
EXERCISABLE MAY BE EFFECTED EXCEPT IN COMPLIANCE WITH
RULE 144 UNDER SAID ACT OR WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL FOR THE HOLDER,
SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS NOT REQUIRED
UNDER THE ACT OR RECEIPT OF A NO-ACTION LETTER FROM THE SECURITIES
AND EXCHANGE COMMISSION.
WARRANT TO PURCHASE SHARES OF COMMON
STOCK
THIS CERTIFIES THAT, for value
received,
("Holder") is entitled to subscribe for and purchase that
number of shares as set forth in Section 1 of the fully paid
and nonassessable Common Stock (the "Shares" or the "Common Stock")
of FAVRILLE, INC., a Delaware corporation (the "Company"), at the
Warrant Price (as hereinafter defined), subject to the provisions
and upon the terms and conditions hereinafter set forth. As used
herein, the term "Common Stock" shall mean the Company's presently
authorized Common Stock.
This Warrant is being issued
pursuant to that certain Creditor Plan dated November 8, 2008 by
and among the Company, mymedicalrecords.com, Inc., a Delaware
corporation ("MMR"), and Kershaw, Mackie & Co., (the "Creditor
Plan").
1.
Warrant Price; Grant . The "Warrant Price" per share
shall initially be $0.12, and this Warrant shall be exercisable for
(
) shares of Common Stock (the
"Grant"), subject to adjustment as provided in Section 7
below.
2.
Conditions to Exercise . The purchase right
represented by the Grant may be exercised at any time, or from
time to time, in whole or in part during the term commencing
on the date hereof and ending at 5:00 P.M. Eastern Standard
time on January 26, 2014.
3.
Method of Exercise; Payment; Issuance of Shares; Issuance of New
Warrant .
(a)
Cash Exercise . Subject to Sections 1 and 2 hereof, the
purchase right represented by this Warrant may be exercised by
the Holder hereof, in whole or in part, by the surrender of this
Warrant (with a duly executed Notice of Exercise in the
form attached hereto) at the principal office of the Company
(as set forth in Section 17 below) and by payment to the
Company, by check, of an amount equal to the then applicable
Warrant Price per share multiplied by the number of shares then
being purchased. In the event of any exercise of the rights
represented by this Warrant, certificates for the shares of stock
so purchased shall be in the name of, and delivered to, the Holder
hereof, or as such Holder may direct (subject to the terms of
transfer contained herein and upon payment by such Holder hereof of
any applicable transfer taxes). Such delivery shall be made within
10 days after exercise of the Warrant and at the Company's expense
and, unless this Warrant has been fully exercised or expired, a new
Warrant having terms and conditions substantially similar to this
Warrant and representing the portion of the Shares, if any, with
respect to
which
this Warrant shall not have been exercised, shall also be issued to
the Holder hereof within 10 days after exercise of the
Warrant.
(b)
Net Issue Exercise . In lieu of exercising this Warrant
pursuant to Section 3(a), Holder may elect to receive
shares equal to the value of this Warrant (or of any portion
thereof remaining unexercised) by surrender of this Warrant at the
principal office of the Company together with notice of such
election, in which event the Company shall issue to Holder the
number of shares of the Company's Common Stock computed using the
following formula:
X =
Y (A-B)
A
Where X
= the number of shares of Common Stock to be issued to
Holder.
Y = the
number of shares of Common Stock purchasable under this Warrant (at
the date of such calculation).
A = the
Fair Market Value of one share of the Company's Common Stock (at
the date of such calculation).
B =
Warrant Price per share (as adjusted to the date of such
calculation).
(c)
Fair Market Value . For purposes of this Section 3,
"Fair Market Value" of one share of the Company's Common Stock
shall mean:
(i) If
the Common Stock is traded Over-The-Counter or on The NASDAQ Stock
Market, LLC or on another exchange, the per share Fair Market Value
for the Common Stock will be the average of the closing bid and
asked prices of the Common Stock quoted in the Over-The-Counter
Market Summary or the closing sales price quoted on any exchange on
which the Common Stock is listed, whichever is applicable, as
published in the Western Edition of The Wall Street Journal for the
twenty (20) trading days prior to the date of determination of
Fair Market Value; or
(ii) In
any other instance, the per share Fair Market Value for the Common
Stock shall be as determined in good faith by the Company's Board
of Directors (the "Board").
In the
event of 3(c)(ii) above, the Company's Board of Directors
shall prepare a certificate, to be signed by an authorized officer
of the Company, setting forth in reasonable detail the basis for
and method of determination of the per share Fair Market Value of
the Common Stock. The Board will also certify to the Holder that
this per share Fair Market Value will be applicable to all holders
of the Company's Common Stock that require a fair market value
determination as of the same date as Holder.
(d)
Automatic Exercise . To the extent this Warrant is not
previously exercised, it shall be automatically exercised in
accordance with Sections 3(b) and 3(c) hereof (even if
not surrendered) immediately before its expiration.
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(e)
No Net Cash Settlement . Notwithstanding any other provision
of this Warrant to the contrary, under no circumstances will the
Company be required to effect any "net-cash settlement" (within the
meaning of the Financial Accounting Standards Board's
EITF 00-19, Accounting for Derivative Financial Instruments
Indexed to, and Potentially Settled in, a Company's Own Stock )
of this Warrant.
4.
Representations and Warranties of Holder and Restrictions on
Transfer Imposed by the Securities Act of 1933 .
(a)
Representations and Warranties by Holder . The Holder
represents and warrants to the Company with respect to this
purchase as follows:
(i) The
Holder has substantial experience in evaluating and investing in
private placement transactions of securities of companies similar
to the Company so that the Holder is capable of evaluating the
merits and risks of its investment in the Company and has the
capacity to protect its interests. The Holder is an "accredited
investor" as that term is defined in Rule 501 promulgated
under the Securities Act of 1933, as amended (the
"Act").
(ii) The
Holder is acquiring the Warrant and the Shares of Common Stock
issuable upon exercise of the Warrant (collectively the
"Securities") for investment for its own account and not with a
view to, or for resale in connection with, any distribution
thereof. The Holder understands that the Securities have not been
registered under the Act by reason of a specific exemption from the
registration provisions of the Act, which depends upon, among other
things, the bona fide nature of the investment intent as expressed
herein. In this connection, the Holder understands that, in the
view of the Securities and Exchange Commission (the "SEC"), the
statutory basis for such exemption may be unavailable if this
representation was predicated solely upon a present intention to
hold the Securities for the minimum capital gains period specified
under tax statutes, for a deferred sale, for or until an increase
or decrease in the market price of the Securities or for a period
of one year or any other fixed period in the future.
(iii) The
Holder acknowledges that the Securities must be held indefinitely
unless subsequently registered under the Act or an exemption from
such registration is available. The Holder is aware of the
provisions of Rule 144 promulgated under the Act
("Rule 144") which permits limited resale of securities
purchased in a private placement subject to the satisfaction of
certain conditions more fully set forth in such rule.
(iv) The
Holder further understands that at the time the Holder wishes to
sell the Securities there may be no public market upon which
such a sale may be effected, and that even if such a public
market exists, the Company may not be satisfying the current
public information requirements of Rule 144, and that in such
event, the Holder may be precluded from selling the Securities
under Rule 144.
(v) The
Holder has had an opportunity to (i) discuss the Company's and
MMR's business, management and financial affairs with the Company
and MMR management, (ii) review the Company's and MMR's operations
and facilities to the extent reasonably requested and (iii) ask
questions of and receive answers
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from
the Company and MMR and their management regarding the terms and
conditions of the merger of Montana Merger Sub, Inc., a Delaware
corporation and a wholly owned subsidiary of the Company ("Merger
Sub"), with and into MMR (the "Merger") pursuant to that certain
Agreement and Plan of Merger and Reorganization dated November 8,
2008 by and among the Company, MMR and Merger Sub (the "Merger
Agreement") and Holder's proposed investment in order to allow
Holder to make an informed decision about whether to accept the
Shares in connection with the Creditor Plan. The Holder understands
that all such discussions, as well as the written information
issued by the Company and MMR (including the Merger Agreement) were
intended to describe the Merger and the aspects of the Company's
and MMR's business and prospects which they believe to be material
but were not necessarily a thorough or exhaustive
description.
(vi) This
Warrant and the Shares issuable upon exercise of this Warrant (and
the securities issuable, directly or indirectly, upon conversion of
the Shares, if any) may not be transferred or assigned in
whole or in part without compliance with applicable federal
and state securities laws by the transferor and the transferee
(including, without limitation, the delivery of investment
representation letters and legal opinions reasonably satisfactory
to the Company, as reasonably requested by the Company) and any
permitted transferee agrees to be bound by all of the terms and
conditions of this Warrant. The Company shall not require Holder to
provide an opinion of counsel if the transfer is to any other
affiliate of Holder. Additionally, the Company shall also not
require an opinion of counsel if there is no material question as
to the availability of Rule 144.
(b)
Legends . Each certificate representing the Securities shall
be endorsed with the following legend:
THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, AND MAY&
