Exhibit 10.42

 

THIS WARRANT AND THE UNDERLYING SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”). THEY MAY NOT BE SOLD, OFFERED
FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT AS TO SUCH SECURITIES UNDER THE ACT OR AN OPINION OF COUNSEL
SATISFACTORY TO THE CORPORATION THAT SUCH REGISTRATION IS NOT REQUIRED.

 

PROVIDE COMMERCE, INC.

 

WARRANT TO PURCHASE COMMON STOCK

 

November 29, 1999

Re-issued July 7, 2004

 

THIS CERTIFIES THAT, for value received, Vantage Venture Partners, L.P. or its
assigns (the “Holder”), is entitled to subscribe for and purchase at the
Exercise Price (defined below) from Provide Commerce, Inc., a Delaware
corporation, with its principal office at 5005 Wateridge Vista Drive, Second
Floor, San Diego, CA 92121 (the “Corporation” or the “Company”), 10,124 shares
of Common Stock of the Company.

 

1. DEFINITIONS. As used herein, the following terms shall have the following
respective meanings:

 

(a) “Exercise Period” shall mean the period commencing with November 29, 1999
and ending November 29, 2009, unless sooner terminated as provided below.

 

(b) “Exercise Price” shall mean $3.85 per share, subject to adjustment pursuant
to Section 5 below.

 

(c) “Exercise Shares” shall mean the shares of the Corporation’s Common Stock
issuable upon exercise of this Warrant.

 

2. EXERCISE OF WARRANT. The rights represented by this Warrant may be exercised
in whole or in part at any time during the Exercise Period, by delivery of the
following to the Corporation at its address set forth above (or at such other
address as it may designate by notice in writing to the Holder):

 

(a) An executed Notice of Exercise in the form attached hereto;

 

(b) Payment of the Exercise Price in cash, wire transfer, or by check, and

 

(c) This Warrant.

 

Upon the exercise of the rights represented by this Warrant, a certificate or
certificates for the Exercise Shares so purchased, registered in the name of the
Holder or persons affiliated with the Holder, if the Holder so designates, shall
be issued and delivered to the Holder within a reasonable time after the rights
represented by this Warrant shall have been so exercised.

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The person in whose name any certificate or certificates for Exercise Shares are
to be issued upon exercise of this Warrant shall be deemed to have become the
holder of record of such shares on the date which this Warrant was surrendered
and payment of the Exercise Price was made, irrespective of the date of delivery
of such certificate or certificates, except that, if the date of such surrender
and payment is a date when the stock transfer books of the Corporation are
closed, such person shall be deemed to have become the holder of such shares at
the close of business on the next succeeding date on which the stock transfer
books are open.

 

3. COVENANTS OF THE CORPORATION.

 

3.1 Covenants as to Exercise Shares. The Corporation covenants and agrees that
all Exercise Shares that may be issued upon the exercise of the rights
represented by this Warrant will, upon issuance, be validly issued and
outstanding, fully paid and nonassessable, and free from all taxes, liens and
charges with respect to the issuance thereof. The Corporation, further covenants
and agrees that the Corporation will at all times during the Exercise Period,
have authorized and reserved, free from preemptive rights, a sufficient number
of shares of its Common Stock to provide for the exercise of rights represented
by this Warrant. If at any time during the Exercise period the number of
authorized but unissued shares of Common Stock shall not be sufficient to permit
exercise of this Warrant, the Corporation will take such corporate action as
may, in the opinion of its counsel, be necessary to increase its authorized but
unissued shares of Common Stock to such number of shares as shall be sufficient
for such purposes.

 

3.2 No Impairment. Except and to the extent as waived or consented to by the
Holder, the Corporation will not, by amendment of its Certificate of
Incorporation or through any reorganization, transfer of assets, consolidation,
merger, dissolution, issue or sale of securities or any other voluntary action,
avoid or seek to avoid the observance or performance of any of the terms to be
observed or performed hereunder by the Corporation, but will at times in good
faith assist in the carrying out of all the provisions of this Warrant and in
the taking of all such action as may be necessary or appropriate in order to
protect the exercise rights of the Holder against impairment.

 

3.3 Notices of Record Date. In the event of any taking by the Corporation of a
record of the holders of any class of securities for the purpose of determining
the holders thereof who are entitled to receive any dividend (other than a cash
dividend which is the same as cash dividends paid in previous quarters) or other
distribution, the Corporation shall mail to the Holder, at least ten (10) days
prior to the date specified herein, a notice specifying the date on which any
such record is to be taken for the purpose of such dividend or distribution.

 

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4. REPRESENTATION OF HOLDER.

 

4.1 Acquisition of Warrant for Own Account. The Holder represents and warrants
that it is acquiring the Warrant solely for its account for investment and not
with a view to or for sale or distribution of said Warrant or any part thereof.
The Holder also represents that the entire legal and beneficial interests of the
Warrant and Exercise Shares the Holder is acquiring is being acquired for, and
will be held for, its account only.

 

4.2 Securities Are Not Registered.

 

(a) The Holder understands that the Warrant and the Exercise Shares have not
been registered under the Securities Act of 1933, as amended (the “Act”) on the
basis that no distribution or public offering of the stock of the Corporation is
to be effected. The Holder realizes that the basis for the exemption may not be
present if, notwithstanding its representations, the Holder has a present
intention of acquiring the securities for a fixed or determinable period in the
future, selling (in connection with a distribution or otherwise), granting any
participation in, or otherwise distributing the securities. The Holder has no
such present intention.

 

(b) The Holder recognizes that the Warrant and the Exercise Shares must be held
indefinitely unless they are subsequently registered under the Act or an
exemption from such registration is available. The Holder recognizes that the
Corporation has no obligation to register the Warrant or the Exercise Shares of
the Corporation, or to comply with any exemption from such registration.

 

(c) The Holder is aware that neither the Warrant nor the Exercise Shares may be
sold pursuant to Rule 144 adopted under the Act unless certain conditions are
met, including, among other things, the existence of a public market for the
shares, the availability of certain current public information about the
Company, the resale following the required holding period under Rule 144 and the
number of shares being sold during any three month period not exceeding
specified limitations.

 

4.3 Disposition of Warrant and Exercise Shares.

 

(a) The Holder further agrees not to make any disposition of all or any part of
the Warrant or Exercise Shares in any event unless and until:

 

(i) The Corporation shall have received a letter secured by the Holder from the
Securities and Exchange Commission stating that no action will be recommended to
the Commission with respect to the proposed disposition; or

 

(ii) There is then in effect a registration statement under the Act covering
such proposed disposition and such disposition is made in accordance with said
registration statement; or

 

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(iii) The Holder shall have notified the Corporation of the proposed disposition
and shall have furnished the Corporation with a detailed statement of the
circumstances surrounding the proposed disposition, and if reasonably requested
by the Company, the Holder shall have furnished the Corporation with an opinion
of counsel, reasonably satisfactory to the Company, for the Holder to the effect
that such disposition will not require registration of such Warrant or Exercise
Shares under the Act or any applicable state securities laws.

 

(iv) Notwithstanding anything else within this agreement to the contrary, the
Holder will not transfer the Warrant unless the Transferee is intending upon
exercising the Warrant immediately thereafter; and, furthermore, the Transferee
understands that the company has no intention of ever registering the Warrant.

 

(b) The Holder understands and agrees that all certificates evidencing the
shares to be issued to the Holder may bear the following legend:

 

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “ACT”). THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE
SECURITIES UNDER THE ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY
THAT SUCH REGISTRATION IS NOT REQUIRED.

 

(c) The Holder hereby agrees not to sell or otherwise transfer or dispose of all
or any part of this Warrant or the Exercise Shares during a period specified by
the representative of the underwriters of Common Stock (not to exceed one
hundred eighty (180) days) following the effective date of the registration
statement of the Corporation filed under the Act. Holder further agrees that the
Corporation may impose stop-transfer instructions with respect to securities
subject to the foregoing restrictions until the end of such period.

 

5. ADJUSTMENT OF EXERCISE PRICE. In the event of changes in the outstanding
Common Stock of Corporation by reason of stock dividends, split-ups,
recapitalizations, reclassifications, combinations or exchanges of shares,
separations, reorganizations, liquidations, or the like, the number of class of
shares available under the Warrant or in the aggregate and the Exercise Price
shall be correspondingly adjusted to give the Holder of the Warrant, on exercise
for the same aggregate Exercise Price, the total number, class and kind of
shares as the Holder would have owned had the Warrant been exercised prior to
the event and had the Holder continued to hold such shares until after the event
requiring adjustment. The form of this Warrant need not be changed because of
any adjustment in the number of Exercise Shares subject to this Warrant. The
Holder acknowledges that the Exercise Shares and the Exercise Price represent
all such adjustments thereof through and including the re-issue date.

 

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6. FRACTIONAL SHARES. No fractional shares shall be issued upon the exercise of
this Warrant as a consequence of any adjustment pursuant hereto. All Exercise
Shares (including fractions) issuable upon exercise of this Warrant may be
aggregated for purposes of determining whether the exercise would result in the
issuance of any fractional shares. If, after aggregation, the exercise would
result in the issuance of a fractional share, the Corporation shall, in lieu of
issuance of any fractional share, pay the Holder otherwise entitled to such
fraction a sum in cash equal to the product resulting from multiplying the then
current fair market value of an Exercise Share by such fraction.

 

7. NO STOCKHOLDER RIGHTS. This Warrant in and of itself shall not entitle the
Holder to any voting rights or other rights as a stockholder of the Corporation.

 

8. TRANSFER OF WARRANT. Subject to applicable laws, the restriction on transfer
set forth on the first page of this Warrant and elsewhere, this Warrant and all
rights hereunder are transferable, by the Holder in person or by duly authorized
attorney, upon delivery of this Warrant and the form of assignment attached
hereto to any transferee designated by Holder. The transferee shall sign an
investment letter in form and substance satisfactory to the Corporation.

 

9. LOST, STOLEN, MUTILATED OR DESTROYED WARRANT. If this Warrant is lost,
stolen, mutilated or destroyed, the Corporation may, on such terms as to
indemnity or otherwise as it may reasonably impose (which shall, in the case of
the mutilated Warrant, include the surrender thereof), issue a new Warrant of
like denomination and tenor as the Warrant so lost, stolen, mutilated or
destroyed. Any such new Warrant shall constitute an original contractual
obligation of the Corporation, whether or not the allegedly lost, stolen,
mutilated or destroyed Warrant shall be at any time enforceable by anyone.

 

10. NOTICES, ETC. All notices and other communications required or permitted
hereunder shall be in writing and shall be sent by telex, telegram, express mail
or other form of rapid communications, if possible, and if not then such notice
or communication shall be mailed by first-class mail, postage prepaid, addressed
in each case to the party entitled thereto at the following addresses: (a) if to
the Corporation, to Provide Commerce, Inc., 5005 Wateridge Vista Drive, Second
Floor, San Diego, CA 92121, Attention: General Counsel, Fax Number 858-638-4708,
and (b) if to the Holder, to Vantage Venture Partners, L.P., 610 5th Avenue, 7th
Floor, New York, NY 10020; Attention: Christopher Brody, Fax #212/218-8133 or at
such other address as one party may furnish to the other in writing. Notice
shall be deemed effective on the date dispatched if by personal delivery,
telecopy, telex or telegram, three days after mailing if by express mail, or
five days after mailing if by first-class mail.

 

11. ACCEPTANCE. Receipt of this Warrant by the Holder shall constitute
acceptance of and agreement to all of the terms and conditions contained herein.

 

12. GOVERNING LAW. This Warrant and all rights, obligations and liabilities
hereunder shall be governed by the laws of the State of California.

 

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IN WITNESS WHEREOF, the Corporation has caused this Warrant to be executed by
its duly authorized officer as of July 7, 2004.

 

PROVIDE COMMERCE, INC.

By:

 

/s/    WILLIAM STRAUSS            

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Name:

 

William Strauss

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Title:

 

CEO

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Accepted and Agreed:

 

VANTAGE VENTURE PARTNERS, L.P.

By:

 

Vantage Partners, LLC, its General Partner

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By:

 

/s/    CHRISTOPHER W. BRODY        

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Name:

 

Christopher W. Brody

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Title:

 

Chairman

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NOTICE OF EXERCISE

 

TO: PROVIDE COMMERCE, INC.

 

(1) The undersigned hereby elects to purchase              shares of the Common
Stock of PROVIDE COMMERCE, INC. (the “Company”) pursuant to the terms of the
attached Warrant, and tenders herewith payment of the exercise price in full,
together with all applicable transfer taxes, if any.

 

(2) Please issue a certificate or certificates representing said shares of
Common Stock in the name of the undersigned or in such other name as specified
below:

 

_______________________________

(Name)

 

_______________________________

_______________________________

(Address)

 

(3) The undersigned represents that (i) the undersigned is aware of the
Company’s business affairs and financial condition and has acquired sufficient
information about the Company to reach an informed and knowledgeable decision
regarding its investment in the Company (ii) the undersigned is experienced in
making investments of this type and has such knowledge and background in
financial and business matters that the undersigned is capable of evaluating the
merits and risks of this investment and protecting the undersigned’s own
interests; (iii) the undersigned is aware that the aforesaid shares of Common
Stock may not be sold pursuant to Rule 144 adopted under the Securities Act
unless certain conditions are met and until the undersigned has held the shares
for the number of years prescribed by Rule 144, that among the conditions for
use of the Rule is the availability of current information to the public about
the Company and (iv) the undersigned agrees not to make any disposition of all
or any part of the aforesaid shares of Common Stock unless there is in effect a
registration statement under the Securities Act covering such proposed
disposition and such disposition is made in accordance with said registration
statement, or the undersigned has provided the Company with an opinion of
counsel satisfactory to the Company, stating that such registration is not
required.

 

 

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(Date)

 

(Signature)

   

 

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(Print Name)

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ASSIGNMENT FORM

 

FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are
hereby assigned to

 

Name:

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(Please Print)

Address:

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(Please Print)

Dated:

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Holder’s

Signature:

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Holder’s

Address:

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NOTE: The signature to this Assignment Form must correspond with the name as it
appears on the face of the Warrant, without alteration or enlargement or any
change whatever. Officers of corporations and those acting in a fiduciary or
other representative capacity should file proper evidence of authority to assign
the foregoing Warrant.