Exhibit 10.4

EXECUTION

AGREEMENT TO AMEND WARRANTS

THIS AGREEMENT TO AMEND WARRANTS (the “Agreement”) is made and entered into as
of June 23, 2009, by and between EDIETS.COM, INC., a Delaware corporation (the
“Company”), and PRIDES CAPITAL FUND I, L.P., a Massachusetts limited partnership
(the “Warrant Holder”).

WHEREAS, the Company has issued to the Warrant Holder certain Warrants for the
Purchase of Shares of Common Stock, as more fully described on Schedule 1
attached hereto and incorporated herein by reference (as amended, replaced,
restated, superseded and/or modified from time to time, each an “Existing
Warrant” and collectively, the “Existing Warrants”);

WHEREAS, the Company and the Warrant Holder have entered into an Amendment No. 1
to Warrant for the Purchase of Common Stock dated as of May 30, 2008 (“Amendment
No. 1”) amending the Existing Warrant dated August 31, 2007; and

WHEREAS, the Company has informed the Warrant Holder that it would agree to
amend the exercise price of the Existing Warrants and to provide certain further
inducements if the Warrant Holder will use diligent efforts to exercise such
Existing Warrants as soon as reasonably practicable, all in the manner set forth
in this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants contained herein, and
for other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, and intending to be legally bound hereby, the parties
hereto do hereby agree as follows:

1. Capitalized terms not otherwise defined in this Agreement have the meanings
provided in the Existing Warrants.

2. The Existing Warrants are hereby amended by deleting the definition of “Per
Share Warrant Price” in such Existing Warrant and replacing such definition with
“a per share exercise price of $1.00 (the “Per Share Warrant Price”).”

3. The Warrant Holder shall use diligent efforts to exercise, in one or more
tranches, a portion of the Existing Warrants, as amended by this Agreement, as
soon as reasonably practicable following execution of this Agreement in order to
purchase 2,500,000 Warrant Shares.

4. The Section 3(c) of the Existing Warrant dated as of May 30, 2008 and the
Existing Warrant dated as of August 31, 2007 (as amended by Amendment No. 1) are
each hereby amended to insert the following at the end of the first sentence
thereof:

“; provided, however, that no adjustment under this Section 3(c) shall operate
to reduce the Per Share Warrant Price of the Warrant Shares to a price that is
less than $0.92 per share, representing the closing bid price for one share of
the Common Stock on June 22, 2009”.

 

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5. As a further inducement to the Warrant Holder, within three Trading Days
following (i) the exercise by the Warrant Holder of all or any portion of the
Existing Warrants and (ii) receipt by the Company of payment of the Per Share
Warrant Price multiplied by the number of Warrant Shares to which such exercise
relates, the Company shall issue to the Warrant Holder a warrant (each, a “New
Warrant” and collectively the “New Warrants”) in the form of Exhibit A attached
hereto and incorporated herein by reference, entitling the Warrant Holder to
purchase up to a number of shares of the Company’s common stock equal to 45% of
the Warrant Shares to which such exercise relates. Such New Warrant shall be
exercisable on or after the Original Issue Date (as defined in the New Warrant),
shall have a term of exercise equal to ten (10) years and shall have a strike
price of $1.20 per share. The Company shall undertake to register shares of
common stock issued pursuant to the exercise of New Warrants in accordance with
the terms of the Registration Rights Agreement (as defined in the New Warrant).

6. On the date hereof and again on the date of issuance of each New Warrant, the
Warrant Holder represents and warrants to, and covenants with, the Company as
follows:

(a) the Warrant Holder was at the time it was offered the New Warrant, is as of
the date hereof and as of the Closing and will be on each date it exercises the
Warrant an “accredited Warrant Holder” as such term is defined in Rule 501 of
Regulation D promulgated pursuant to the Securities Act of 1933, as amended, is
knowledgeable, sophisticated and experienced in making, and is qualified to make
decisions with respect to, investments in securities presenting an investment
decision similar to that involved in the purchase of the New Warrant, and has
requested, received, reviewed and considered all information the Warrant Holder
deemed relevant in making an informed decision to purchase the New Warrant and
is able to bear the economic risk of an investment in the New Warrant and, at
the present time, is able to afford a complete loss of such investment;

(b) the Warrant Holder understands that the New Warrants are “restricted
securities” and have not been registered under the Securities Act, or registered
or qualified under any state securities law, in reliance on specific exemptions
therefrom, which exemptions may depend upon, among other things, the
representations made by the Warrant Holder in this Agreement; the Warrant Holder
is acquiring the New Warrant in the ordinary course of business and for the
Warrant Holder’s own account for investment only, has no present intention of
distributing any of such New Warrant and has no arrangement or understanding
with any other persons regarding the distribution of such New Warrant; and

(c) the Warrant Holder will not, directly or indirectly, offer, sell, pledge,
transfer or otherwise dispose of (or solicit any offers to buy, purchase or
otherwise acquire or take a pledge of) any of the New Warrant except in
compliance with the Securities Act, applicable state securities laws and the
respective rules and regulations promulgated thereunder.

7. On the date hereof and again on the date of issuance of each New Warrant, the
Company represents and warrants to, and covenants with, the Warrant Holder as
follows:

(a) The Company is duly incorporated and validly existing in good standing under
the laws of the State of Delaware, has full power and authority to own, operate
and occupy its properties and to conduct its business as presently conducted and
is registered or qualified to do business and in good standing in each
jurisdiction in which it owns or leases property or transacts business and

 

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where the failure to be so qualified would have a material adverse effect upon
the Company and its subsidiaries as a whole or the business, financial
condition, prospects, properties, operations or assets of the Company and its
subsidiaries as a whole or the Company’s ability to perform its obligations
under this Agreement in all material respects, and no proceeding has been
instituted in any such jurisdiction revoking, limiting or curtailing, or seeking
to revoke, limit or curtail, such power and authority or qualification;

(b) The Company has all requisite power and authority to execute, deliver and
perform its obligations under this Agreement; the execution and delivery of this
Agreement, and the consummation by the Company of the transactions contemplated
hereby, have been duly authorized by all necessary corporate action and no
further action on the part of the Company or the Board or shareholders is
required; and

(c) The New Warrants have been duly authorized, and when issued and paid for in
accordance with the terms of this Agreement, will be duly and validly issued,
fully paid and nonassessable, subject to no lien, claim or encumbrance (except
for any such lien, claim or encumbrance created, directly or indirectly, by the
Warrant Holder).

8. This Agreement shall be effective as of the date first above written (the
“Effective Date”) on the date when the Company and the Warrant Holder shall have
executed, and delivered to each other, its respective counterpart to this
Agreement.

9. Except as specifically set forth in this Agreement, there are no other
amendments, modifications or waivers to the Existing Warrants, and all of the
other forms, terms and provisions of the Existing Warrants remain in full force
and effect.

10. This Agreement shall be binding upon the parties hereto and their respective
successors and permitted assigns and shall inure to the benefit of and be
enforceable by each of the parties hereto and their respective successors and
permitted assigns. This Agreement shall be construed and enforced in accordance
with and governed by the law of the State of Delaware without giving effect to
the principles of conflicts of law thereof. This Agreement may be executed in
any number of counterparts, each of which shall be an original, but all of which
shall constitute one instrument.

[Remainder of page left intentionally blank]

 

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EXECUTION

IN WITNESS WHEREOF, the Warrant Holder and the Company have executed and
delivered this Agreement as of the date first above written.

 

EDIETS.COM, INC. By:  

/s/ Thomas Hoyer

Name:  

Thomas Hoyer

Title:  

Chief Financial Officer

PRIDES CAPITAL FUND I, L.P. By:   Prides Capital Partners, LLC Its:   General
Partner

 

  By:  

/s/ Stephen Cootey

  Name:  

Stephen Cootey

  Title:  

Authorized Representative

 

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Schedule 1

Schedule of Warrants

 

Issue Date

   Shares    Original Per Share
Exercise Price

May 15, 2006

   1,009,901    $ 6.00

August 1, 2006

   178,218    $ 6.00

August 31, 2007

   1,000,000    $ 5.00

May 30, 2008

   500,000    $ 4.25

 

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Exhibit A

Form of New Warrant

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT
AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), OR ANY STATE SECURITIES LAW. SUCH SECURITIES MAY NOT BE SOLD
OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH SALE OR
TRANSFER IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF
THE ACT OR THE ISSUER HAS RECEIVED AN OPINION OF COUNSEL IN FORM AND SUBSTANCE
REASONABLY ACCEPTABLE TO THE ISSUER THAT REGISTRATION IS NOT REQUIRED UNDER THE
ACT OR APPLICABLE STATE SECURITIES LAWS. THESE SECURITIES AND THE SECURITIES
ISSUABLE UPON EXERCISE OF THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A
BONA FIDE MARGIN ACCOUNT SECURED BY SUCH SECURITIES.

eDiets.com, Inc.

Warrant for the Purchase of Shares of

Common Stock

 

                     Shares                 , 20    

FOR VALUE RECEIVED, eDiets.com, Inc., a Delaware corporation (the “Company”),
hereby certifies that                                          or his assigns,
is entitled to purchase from the Company, at any time or from time to time
commencing on the date hereof (the “Initial Exercise Date”) and expiring at 5:00
P.M., New York City time, on the ten (10) year anniversary of the Original Issue
Date (the “Expiration Date”)                                         
(            ) fully paid and non-assessable shares of Common Stock, par value
$.001 per share, of the Company (the “Warrant Shares”) for a per share exercise
price of $1.20 (the “Per Share Warrant Price”). The Per Share Warrant Price is
subject to adjustment as hereinafter provided. Capitalized terms used and not
otherwise defined in this Warrant shall have the meanings specified in
Section 8, unless the context otherwise requires.

1. Exercise of Warrant.

(a) This Warrant may be exercised, in whole at any time or in part from time to
time, commencing on the Initial Exercise Date and expiring at 5:00 P.M., New
York City time, on the Expiration Date (with the Exercise Notice at the end of
this Warrant duly executed) at the address set forth in Section 10 hereof,
together with payment of the Per Share Warrant Price multiplied by the number of
Warrant Shares to which such exercise relates made by delivery to the Company of
one or more types of Permitted Consideration.

(b) If this Warrant is exercised in part, the Company will deliver to the Holder
within three Trading Days of the date such Holder delivers to the Company this
Warrant and an Exercise Notice, together with the payment of the aggregate Per
Share Warrant

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Price for such exercise, a new Warrant covering the Warrant Shares that have not
been exercised. By the expiration of the third Trading Day following the
Holder’s delivery of a Warrant, together with an Exercise Notice and the payment
of the aggregate Per Share Warrant Price for such exercise, the Company will
(i) issue a certificate or certificates in the name of the Holder for the
largest number of whole shares of the Common Stock to which the Holder shall be
entitled and, if this Warrant is exercised in whole, in lieu of any fractional
share of the Common Stock to which the Holder shall be entitled, pay to the
Holder cash in an amount equal to the fair value of such fractional share
(determined by reference to the closing sales price of the Common Stock on the
date of the Exercise Notice), and (ii) deliver the other securities and
properties receivable upon the exercise of this Warrant, or the proportionate
part thereof if this Warrant is exercised in part, pursuant to the provisions of
this Warrant.

(c) If, by the third Trading Day after the date that the Holder delivers an
Exercise Notice, together with the payment of the aggregate Per Share Warrant
Price for such exercise, the Company fails to deliver the required number of
Warrant Shares in the manner required pursuant to Section 1(b), then the Holder
will have the right to rescind such exercise.

(d) If, by the third Trading Day after the date that the Holder delivers an
Exercise Notice, together with the payment of the aggregate Per Share Warrant
Price for such exercise, the Company fails to deliver the required number of
Warrant Shares in the manner required pursuant to Section 1(b), and if after
such third Trading Day and prior to the receipt of such Warrant Shares, the
Holder purchases (in an open market transaction or otherwise) shares of Common
Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares
which the Holder anticipated receiving upon such exercise (a “Buy-In”), then the
Company shall (1) pay in cash to the Holder the amount by which (x) the Holder’s
total purchase price (including brokerage commissions, if any) for the shares of
Common Stock so purchased exceeds (y) the amount obtained by multiplying (A) the
number of Warrant Shares that the Company was required to deliver to the Holder
in connection with the exercise at issue by (B) the closing bid price of the
Common Stock at the time of the obligation giving rise to such purchase
obligation and (2) at the option of the Holder, either reinstate the portion of
the Warrant and equivalent number of Warrant Shares for which such exercise was
not honored or deliver to the Holder the number of shares of Common Stock that
would have been issued had the Company timely complied with its exercise and
delivery obligations hereunder. The Holder shall provide the Company written
notice indicating the amounts payable to the Holder in respect of the Buy-In.

(e) If, after the Required Effective Date (as defined in the Registration Rights
Agreement) the Warrant Shares to be issued are not registered and available for
resale by the Holder pursuant to a registration statement in accordance with the
Registration Rights Agreement, then notwithstanding anything contained herein to
the contrary, the Holder may, at its election exercised in its sole discretion,
exercise a portion of this Warrant with respect to an aggregate total of
twenty-five percent (25%) of the total Warrant Shares and, in lieu of making a
cash payment of Permitted Consideration, elect instead to receive upon such
exercise the “Net Number” of shares of Common Stock determined according to the
following formula:

 

Net Number = (A x B) – (A x C)

                                       B

 

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For purposes of the foregoing formula:

A=the total number of Warrant Shares with respect

to which this Warrant is then being exercised.

B=the average of the closing sales prices for the five

Trading Days immediately prior to (but not including)

the day that the Holder delivers the Exercise Notice at issue.

C=the Per Share Warrant Price.

2. Company’s Option to Change Expiration Date.

Notwithstanding anything herein to the contrary, in the event that (i) the
closing sales price per share of Common Stock is in excess of 150% of the Per
Share Warrant Price (as may be adjusted pursuant to Section 3) for thirty
(30) consecutive Trading Days, (ii) the Warrant Shares are either registered for
resale pursuant to an effective registration statement naming the Holder as a
selling stockholder thereunder (and the prospectus thereunder is available for
use by the Holder as to all then available Warrant Shares) or freely
transferable without volume restrictions pursuant to Rule 144(k) promulgated
under the Securities Act, as determined by counsel to the Company pursuant to a
written opinion letter addressed and in form and substance reasonably acceptable
to the Holder and the transfer agent for the Common Stock, during the entire
sixty (60) Trading Day period referenced in (i) above through the expiration of
the Call Date as set forth in the Company’s notice pursuant to this Section (the
“Call Condition Period”), and (iii) the Company shall have complied in all
material respects with its obligations under this Warrant and the Common Stock
shall at all times be listed on the AMEX, New York Stock Exchange, the Nasdaq
National Market, the Nasdaq Capital Market or the OTC Bulletin Board, then,
subject to the conditions set forth in this Section, the Company may, in its
sole discretion, elect to change the Expiration Date for the respective Warrant
to 5:00 P.M., New York City time on the date that is thirty (30) days after
written notice thereof (a “Call Notice”) is received by the Holder (the “Call
Date”) at the address last shown on the records of the Company for the Holder or
given by the Holder to the Company for the purpose of notice; provided, that the
conditions to giving such notice must be in effect at all times during the Call
Condition Period or any such notice shall be null and void. Notwithstanding
anything herein to the contrary, if the Company changes the Expiration Date
pursuant to this Section 2, the Holder may, at its election exercised in its
sole discretion, exercise a portion of this Warrant with respect to an aggregate
total (including any exercises made under Section 1(e)) of twenty-five percent
(25%) of the total Warrant Shares and, in lieu of making a cash payment of
Permitted Consideration, elect instead to receive upon such exercise the “Net
Number” of shares of Common Stock determined according to the formula set forth
in Section 1(e).

3. Certain Adjustments. The Per Share Warrant Price and number of Warrant Shares
issuable upon exercise of this Warrant are subject to adjustment from time to
time as set forth in this Section 3.

(a) If the Company, at any time while this Warrant is outstanding, (i) pays a
stock dividend on its Common Stock or otherwise makes a distribution on any
class of capital stock that is payable in shares of Common Stock,
(ii) subdivides outstanding

 

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shares of Common Stock into a larger number of shares, or (iii) combines
outstanding shares of Common Stock into a smaller number of shares, then in each
such case the Per Share Warrant Price shall be multiplied by a fraction of which
the numerator shall be the number of shares of Common Stock outstanding
immediately before such event and of which the denominator shall be the number
of shares of Common Stock outstanding immediately after such event. Any
adjustment made pursuant to clause (i) of this paragraph shall become effective
immediately after the record date for the determination of shareholders entitled
to receive such dividend or distribution, and any adjustment pursuant to clause
(ii) or (iii) of this paragraph shall become effective immediately after the
effective date of such subdivision or combination.

(b) If, at any time while this Warrant is outstanding, (1) the Company effects
any merger or consolidation of the Company with or into another person, (2) the
Company effects any sale of all or substantially all of its assets in one or a
series of related transactions, (3) any tender offer or exchange offer (whether
by the Company or another Person) is completed pursuant to which holders of
Common Stock are permitted to tender or exchange their shares for other
securities, cash or property, or (4) the Company effects any reclassification of
the Common Stock or any compulsory share exchange pursuant to which the Common
Stock is effectively converted into or exchanged for other securities, cash or
property (in any such case, a “Fundamental Transaction”), then thereafter this
Warrant shall represent the right to receive, upon exercise of this Warrant, the
same amount and kind of securities, cash or property as it would have been
entitled to receive upon the occurrence of such Fundamental Transaction if it
had been, immediately prior to such Fundamental Transaction, the holder of the
number of Warrant Shares then issuable upon exercise in full of this Warrant
(the “Alternate Consideration”). For purposes of any such exercise, the
determination of the Per Share Warrant Price shall be appropriately adjusted to
apply to such Alternate Consideration based on the amount of Alternate
Consideration issuable in respect of one share of Common Stock in such
Fundamental Transaction, and the Company shall apportion the Per Share Warrant
Price among the Alternate Consideration in a reasonable manner reflecting the
relative value of any different components of the Alternate Consideration. If
holders of Common Stock are given any choice as to the securities, cash or
property to be received in a Fundamental Transaction, then the Holder shall be
given the same choice as to the Alternate Consideration it receives upon any
exercise of this Warrant following such Fundamental Transaction. At the Holder’s
option and request, any successor to the Company or surviving entity (and, if an
entity different from the successor or surviving entity, the entity whose
capital stock or assets the Holders of Common Stock are entitled to receive as a
result of such Fundamental Transaction) in such Fundamental Transaction shall,
either (1) issue to the Holder a new warrant substantially in the form of this
Warrant and consistent with the foregoing provisions and evidencing the Holder’s
right to purchase the Alternate Consideration for the aggregate Per Share
Warrant Price upon exercise thereof, or (2) purchase the Warrant from the Holder
for a purchase price, payable in cash within five trading days after such
request (or, if later, on the effective date of the Fundamental Transaction),
equal to the Black Scholes value of the remaining unexercised portion of this
Warrant on the date of such request. The terms of any agreement pursuant to
which a Fundamental Transaction is effected shall include terms requiring any
such successor or surviving entity (and, if an entity different from the
successor or surviving entity, the entity whose capital stock or assets the
Holders of Common Stock are entitled to receive as a result of such Fundamental
Transaction) to comply with the provisions of this paragraph (b) and insuring
that the Warrant (or any such replacement security) will be similarly adjusted
upon any subsequent transaction analogous to a Fundamental Transaction.

 

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(c) If, at any time while this Warrant is outstanding, the Company shall issue
additional shares of Common Stock for consideration per share less than the then
current market price (determined (a) in the event that the Common Stock is
publicly listed, by reference to the closing sales price of the Common Stock on
the date of such issue or (b) in the event that the Common Stock is not publicly
listed, by reference to the then current market value of each share of Common
Stock as determined by the Board of Directors of the Company in good faith;
provided, however, that in the event of a sale, merger, liquidation, dissolution
or winding up of the Company (each, a “Liquidity Event”), current market price
means the amount per share payable to the holders of the Common Stock upon the
consummation of such Liquidity Event), then the Per Share Warrant Price of the
Warrant Shares shall be reduced, concurrently with such issue, to a price
(calculated to the nearest cent) determined by multiplying such Per Share
Warrant Price by a fraction, the numerator of which shall be the number of
shares of Common Stock outstanding immediately prior to such issue plus the
number of shares which the aggregate consideration received by the Company for
the total number of additional shares of Common Stock so issued would purchase
at the then current fair market price, and the denominator of which shall be the
number of shares of Common Stock outstanding immediately prior to such issue
plus the number of such additional shares of Common Stock so issued; provided,
however, that no adjustment under this Section 3(c) shall operate to reduce the
Per Share Warrant Price of the Warrant Shares to a price that is less than $0.92
per share, representing the closing bid price for one share of the Common Stock
on June 22, 2009. Notwithstanding the foregoing, no adjustment to the Per Share
Warrant Price shall be required under this Section 3(c): (i) in connection with
the issuance of shares of Common Stock and/or options, warrants or other Common
Stock purchase rights and the Common Stock issued pursuant to such options,
warrants or other rights (as adjusted for any stock dividends, combinations,
splits, recapitalizations and the like after the date hereof) issued or to be
issued after the date hereof to employees, officers or directors of, or
consultants or advisors to the Company or any subsidiary, pursuant to stock
purchase, stock option or employee benefit plans or other arrangements that are
approved by the board of directors of the Company; (ii) in connection with a
bona fide firm commitment underwritten public offering with a nationally
recognized underwriter which generates gross proceeds to the Company in excess
of $15 million; (iii) upon conversion of any options, warrants or other rights
to acquire shares of Common Stock that are outstanding on the day immediately
preceding the date hereof, provided, however, that the terms of such options,
warrants or rights are not amended, modified or changed on or after the date
hereof; or (iv) in connection with shares of Common Stock issued as
consideration for the acquisition of another company or business in which the
shareholders of the Company do not have a majority ownership interest, which
acquisition has been approved by the board of directors of the Company, provided
that after giving effect to such acquisition the Company is the surviving
entity.

(d) All calculations under this Section 3 shall be made to the nearest cent or
the nearest 1/100th of a share, as applicable. The number of shares of Common
Stock outstanding at any given time shall not include shares owned or held by or
for the account of the Company.

 

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(e) Upon the occurrence of each adjustment pursuant to this Section 3, the
Company at its expense will promptly compute such adjustment in accordance with
the terms of this Warrant and prepare a certificate setting forth such
adjustment, including a statement of the adjusted Per Share Warrant Price and
adjusted number or type of Warrant Shares or other securities issuable upon
exercise of this Warrant (as applicable), describing the transactions giving
rise to such adjustments and showing in detail the facts upon which such
adjustment is based. The Company will promptly deliver a copy of each such
certificate to the Holder and to the Company’s transfer agent.

4. Fully Paid Stock; Taxes. The Company agrees that the shares of Common Stock
represented by each and every certificate for Warrant Shares delivered on the
exercise of this Warrant shall at the time of such delivery, be duly authorized,
validly issued and outstanding, fully paid and nonassessable, and not subject to
preemptive rights or rights of first refusal, and the Company will take all such
actions as may be necessary to assure that the par value or stated value, if
any, per share of the Common Stock is at all times equal to or less than the
then Per Share Warrant Price. The Company further covenants and agrees that it
will pay, when due and payable, any and all Federal and state stamp, original
issue or similar taxes which may be payable in respect of the issue of any
Warrant Share or any certificate thereof to the extent required because of the
issuance by the Company of such security.

5. Registration Under Securities Act.

(a) The Holder shall, with respect to the Warrant Shares, have the registration
rights set forth in the Registration Rights Agreement. By acceptance of this
Warrant, the Holder agrees to comply with the provisions of the Registration
Rights Agreement.

(b) Until the later of (i) such time as the Holder shall be eligible to resell
all of its Warrant Shares without volume restrictions pursuant to Rule 144(k)
promulgated under the Securities Act (assuming Holder is not an “affiliate” of
the Company, as defined in Rule 144), as evidenced by a legal opinion to such
effect delivered by the Company’s counsel and acceptable to each of the
Company’s transfer agent and the Holder, or (ii) the date on which all Warrant
Shares have been sold under a Registration Statement or pursuant to Rule 144
(“Rule 144”) as promulgated under the Securities Act, the Company shall use its
reasonable best efforts to file with the Securities and Exchange Commission all
current reports and the information as may be necessary to enable the Holder to
effect sales of the Warrant Shares in reliance upon Rule 144 promulgated under
the Securities Act.

6. Investment Intent; Restrictions on Transferability.

(a) The Holder represents, by accepting this Warrant that it understands that
this Warrant and any securities obtainable upon exercise of this Warrant have
not been registered for sale under Federal or state securities laws and are
being offered and sold to the Holder pursuant to one or more exemptions from the
registration requirements of such securities laws. Certificates representing
Warrant Shares may bear the restrictive legend set forth on the first page
hereof. The Holder understands that the Holder must bear the economic risk of
such Holder’s investment in this Warrant and any Warrant Shares or other
securities obtainable upon exercise of this Warrant for an indefinite period of
time, as this Warrant and such Warrant shares or other securities have not been
registered under Federal or state securities laws and therefore cannot be sold
unless subsequently registered under such laws, or an exemption from such
registration is available.

 

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(b) The Holder, by such Holder’s acceptance of this Warrant, represents to the
Company that such Holder is acquiring this Warrant and will acquire any Warrant
Shares or other securities obtainable upon exercise of this Warrant for such
Holder’s own account for investment and not with a view to, or for sale in
connection with, any distribution thereof in violation of the Securities Act.
The Holder agrees that this Warrant and any such Warrant Shares or other
securities will not be sold or otherwise transferred unless (i) a registration
statement with respect to such transfer is effective under the Securities Act or
(ii) such sale or transfer is made pursuant to one or more exemptions from the
Securities Act.

7. Loss, Theft, Destruction or Mutilation of Warrant. Upon receipt of evidence
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant, and of indemnity reasonably satisfactory to the Company, if lost,
stolen or destroyed, and upon surrender and cancellation of this Warrant, if
mutilated, the Company shall execute and deliver to the Holder, a new Warrant of
like date, tenor and denomination.

8. Warrant Holder Not Stockholder. This Warrant does not confer upon the Holder
any right to vote or to consent to or receive notice as a stockholder of the
Company, as such, in respect of any matters whatsoever, or any other rights or
liabilities as a stockholder, prior to the exercise hereof; this Warrant does,
however, require certain notices to Holders as set forth herein.

9. Definitions. In addition to the terms defined elsewhere in this Warrant, the
following terms have the following meanings:

“Assignment” shall mean a notice of assignment substantially in the form of
Exhibit A attached hereto.

“Business Day” shall mean any day except Saturday, Sunday and any day that is a
federal legal holiday or a day on which banking institutions in the State of New
York are authorized or required by law or other governmental action to close.

“Common Stock” shall mean the Common Stock, par value $.001 per share, of the
Company, for which the Warrant is exercisable and any securities into which such
common stock may hereafter be classified.

“Exercise Notice” shall mean a notice substantially in the form of Exhibit C
attached hereto.

“Holder” shall mean the holder of this Warrant and “Holders” shall mean the
holder of this Warrant and the holders of all other Warrants.

“Partial Assignment” shall mean a notice of partial assignment substantially in
the form of Exhibit B attached hereto.

 

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“Permitted Consideration” shall mean cash or other funds immediately available
to the Company.

“Registration Rights Agreement” shall mean that certain Registration Rights
Agreement, dated as of June 23, 2009, by and between the Company and the parties
thereto.

“Trading Day” means (i) a day on which the Common Stock is traded on a Trading
Market (other than the OTC Bulletin Board), or (ii) if the Common Stock is not
listed on a Trading Market, a day on which the Common Stock is traded in the
over the counter market, as reported by the OTC Bulletin Board, or (iii) if the
Common Stock is not quoted on the OTC Bulletin Board, a day on which the Common
Stock is quoted in the over the counter market as reported by the National
Quotation Bureau Incorporated (or any similar organization or agency succeeding
to its functions of reporting prices); provided, that in the event that the
Common Stock is not listed or quoted as set forth in (i), (ii) and (iii) hereof,
then Trading Day shall mean a Business Day.

“Trading Market” shall mean whichever of the New York Stock Exchange, the AMEX,
the NASDAQ Global Select Market, the NASDAQ Global Market, the NASDAQ Capital
Market or OTC Bulletin Board on which the Common Stock is listed or quoted for
trading on the date in question.

“Warrants” shall mean this Warrant, all similar Warrants issued on the date
hereof and all warrants hereafter issued in exchange or substitution for this
Warrant or such similar Warrants.

10. Communication. All notices and communications hereunder shall be in writing
and shall be deemed to be duly given if sent by registered or certified mail,
return receipt requested, via a national recognized overnight mail delivery
service, or by facsimile (provided the sender receives a machine-generated
confirmation of successful transmission), if to the Company, to:

eDiets.com, Inc.

1000 Corporate Drive

Suite 600

Ft. Lauderdale, Florida 33334

Attn: Chief Executive Officer

Tel: 954-703-6347

Fax: 954-938-0031

With a copy to (except in the case of Exercise Notices, Assignments and Partial
Assignments):

Edwards Angell Palmer & Dodge LLP

1 N. Clematis Street

Suite 400

West Palm Beach, Florida 33401

Attn: Leslie J. Croland

Tel: 561-820-0212

Fax: 561-655-8719

 

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If to the Holder of this Warrant, to such Holder at the address listed on the
records of the Company.

11. Reservation of Warrant Shares; Listing. The Company shall at all times prior
to the Expiration Date (a) have authorized and in reserve, and shall keep
available, solely for issuance and delivery upon the exercise of this Warrant,
the shares of the Common Stock and other securities and properties as from time
to time shall be receivable upon the exercise of this Warrant, free and clear of
all restrictions on sale or transfer, other than under Federal or state
securities laws, and free and clear of all preemptive rights and rights of first
refusal; and (b) use its reasonable best efforts to keep the Warrant Shares
authorized for listing on any national securities exchange, the Nasdaq National
Market, the Nasdaq Capital Market or the OTC Bulletin Board.

12. Headings; Severability. The headings of this Warrant have been inserted as a
matter of convenience and shall not affect the construction hereof. In case any
one or more of the provisions of this Warrant shall be invalid or unenforceable
in any respect, the validity and enforceability of the remaining terms and
provisions of this Warrant shall not in any way be affected or impaired thereby
and the parties will attempt in good faith to agree upon a valid and enforceable
provision which shall be a commercially reasonable substitute therefor, and upon
so agreeing, shall incorporate such substitute provision in this Warrant.

13. Applicable Law. This Warrant shall be governed by and construed in
accordance with the law of the State of Delaware without giving effect to the
principles of conflicts of law thereof.

14. Specific Performance. The Company agrees that the remedies at law of the
Holder of this Warrant in the event of any default or threatened default by the
Company in the performance of or compliance with any of the terms of this
Warrant are not and will not be adequate and that, to the fullest extent
permitted by law, such terms maybe specifically enforced by a decree for the
specific performance of any obligation contained herein or by an injunction
against a violation of any of the terms hereof or otherwise.

15. Amendment, Waiver, etc. Except as expressly provided herein, neither this
Warrant nor any term hereof may be amended, waived, discharged or terminated
other than by a written instrument signed by the party against whom enforcement
of any such amendment, waiver, discharge or termination is sought.

IN WITNESS WHEREOF, the Company has caused this Warrant to be duly signed by its
undersigned duly authorized officer as of the Original Issue Date first above
referenced.

 

eDiets.com, Inc. By:  

 

  Name: Thomas Hoyer   Title: Secretary

 

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EXHIBIT A

ASSIGNMENT

FOR VALUE RECEIVED                                          hereby sells,
assigns and transfers unto                                          the
foregoing Warrant and all rights evidenced thereby, and does irrevocably
constitute and appoint                                         , attorney, to
transfer said Warrant on the books of eDiets.com, Inc.

 

Dated:                         Signature:  

 

    Address:  

 

 

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EXHIBIT B

PARTIAL ASSIGNMENT

FOR VALUE RECEIVED                                          hereby assigns and
transfers unto                                          the right to purchase
                     shares of the Common Stock, par value $.001 per share, of
eDiets.com, Inc. covered by the foregoing Warrant, and a proportionate part of
said Warrant and the rights evidenced thereby, and does irrevocably constitute
and appoint                                         , attorney, to transfer that
part of said Warrant on the books of eDiets.com, Inc.

 

Dated:                         Signature:  

 

    Address:  

 

 

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EXHIBIT C

EXERCISE NOTICE

The undersigned hereby elects to purchase                      shares of Common
Stock of eDiets.com, Inc. pursuant to the attached Warrant, and, if such Holder
is not utilizing the cashless (or net) exercise provisions set forth in the
Warrant, encloses herewith $                     in cash, certified or official
bank check or checks or other immediately available funds, which sum represents
the aggregate Per Share Warrant Price for the number of shares of Common Stock
to which this Exercise Notice relates, together with any applicable taxes
payable by the undersigned pursuant to the Warrant.

By its delivery of this Exercise Notice, the undersigned represents and warrants
to the Company that it is an “accredited investor” as defined in Rule 501(a)
under the Securities Act of 1933.

The undersigned requests that certificates for the shares of Common Stock
issuable upon this exercise be issued in the name of:
                                        .

 

Date:                    

   

 

    Signature     Name:  

 

    Address:  

 

     

 

    Social Security or Tax I.D. Number:      

 

 

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