Document:

Exhibit 4.7

 

Issue Date:  May 25, 2006

 

THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR QUALIFIED UNDER
APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED,
ASSIGNED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER SUCH ACT
AND QUALIFIED UNDER APPLICABLE STATE SECURITIES LAWS, OR UNLESS THE CORPORATION
HAS RECEIVED AN OPINION OF COUNSEL OR OTHER EVIDENCE, REASONABLY SATISFACTORY
TO THE CORPORATION AND ITS COUNSEL, THAT SUCH REGISTRATION OR QUALIFICATION IS
NOT REQUIRED.

 

CONVIO, INC.

 

STOCK PURCHASE WARRANT

 

THIS
CERTIFIES that Entrepeneurs Foundation of Central Texas (the “Holder”)
is entitled, upon the terms and subject to the conditions hereinafter set
forth, at any time on or after the date of this Warrant and on or prior to May 25,
2013 (the “Expiration Date”), to subscribe for and purchase, from Convio, Inc.,
a Delaware corporation (the “Company”), 25,000 shares of Common Stock
(or other securities as to which purchase rights under this Warrant exist) (the
“Shares”) at an exercise price of $0.70 per share (the “Exercise
Price”).  The Exercise Price and the
Shares purchasable hereunder are subject to adjustment as set forth in Section 8.

 

1.                                       Exercise of Warrant.

 

(a)                                  The purchase rights represented
by this Warrant are exercisable by the Holder, in whole or in part,
at any time after the date hereof and before the close of business on the
Expiration Date, by the surrender of this Warrant and the Notice of Exercise
annexed hereto duly executed at the principal executive office of the Company
(or such other office or agency of the Company as it may designate by notice in
writing to the Holder at the address of the Holder appearing on the books of
the Company), and upon payment of the Exercise Price of the Shares thereby
purchased (by cash or by check or bank draft payable to the order of the
Company); whereupon the Holder shall be entitled to receive a certificate for
the number of Shares so purchased. The Company agrees that if at the time of
the surrender of this Warrant and purchase of the Shares, the Holder shall be
entitled to exercise this Warrant, the Shares so purchased shall be and be
deemed to be issued to the Holder as the record owner of such Shares as of the
close of business on the date on which this Warrant shall have been exercised
as aforesaid.

 

(b)                                 In lieu of exercising this Warrant by
payment of cash or check pursuant to subsection (a) above, the Holder may
elect to receive Shares equal to the value of this Warrant (or the portion
thereof being exercised), at any time after the date hereof and before the
close of business on the Expiration Date, by surrender of this Warrant at the
principal executive office of the Company, together with the Notice of Conversion
annexed hereto, in which event the Company will issue to the Holder Shares in
accordance with the following formula:

 

 

	
  X

  	
  =

  	
  Y(A-B)

  
	
  A

  

 

	
  Where,

  	
  X

  	
  =

  	
  the number of Shares to be issued to Holder;

  
	
   

  	
  Y

  	
  =

  	
  the number of Shares for which the Warrant is being
  exercised;

  
	
   

  	
  A

  	
  =

  	
  the fair market value of one Share; and

  
	
   

  	
  B

  	
  =

  	
  the Exercise Price.

  

 

(i)                       For purposes of this subsection (b), the
fair market value of a Share is defined as follows:

 

(1)                                  if the exercise is in connection with an
initial public offering of the Common Stock, and if the Company’s registration
statement relating to such offering has been declared effective by the
Securities and Exchange Commission, then the fair market value shall be the
initial “Price to Public” specified in the final prospectus with respect to the
offering;

 

(2)                                  if the exercise is in connection with a
Change of Control (as defined below), then the fair market value shall be the
value received in such Change of Control by the holders of the securities as to
which purchase rights under this Warrant exist;

 

(3)                                  if the exercise occurs after, and not in
connection with the Company’s initial public offering, and:

 

a)                                      if traded on a securities exchange or the
Nasdaq Stock Market, the value shall be deemed to be the average of the closing
prices of the securities on such exchange or market over the thirty (30) day
period ending three (3) days prior to the date of the Notice of
Conversion; or

 

b)                                     if actively traded over-the-counter, the
value shall be deemed to be the average of the closing bid prices over the
thirty (30) day period ending three (3) days prior to the date of the
Notice of Conversion;

 

(4)                                  if there is no active public market, the
value shall be the fair market value thereof, as determined in good faith by
the Company’s Board of Directors.

 

(ii)                    A “Change of Control” shall mean (x) the
acquisition of the Company by another entity by means of any transaction or
series of related transactions (including, without limitation, any merger,
consolidation or other form of reorganization in which outstanding shares of
the Company are exchanged for securities or other consideration issued, or
caused to be issued, by the acquiring entity or its subsidiary, but excluding
any transaction effected primarily for the purpose of changing the Company’s
jurisdiction of incorporation or raising capital for the Company), unless the Company’s stockholders of record as constituted
immediately prior to such transaction or series of related transactions will,
immediately after such transaction or series of related transactions hold

 

2

 

at least a
majority of the voting power of the surviving or acquiring entity or (y) a
sale of all or substantially all of the assets of the Company.

 

2.                                       Nonassessable. 
The Company covenants that all Shares which may be issued upon the
exercise of rights represented by this Warrant will, upon exercise of the
rights represented by this Warrant, be validly issued, fully paid and nonassessable
and free from all taxes, liens and charges in respect of the issue thereof
(other than taxes in respect of any transfer occurring contemporaneously with
such issue).  Certificates for Shares
purchased hereunder shall be delivered to the Holder within a reasonable time
after the date on which this Warrant shall have been exercised as aforesaid.

 

3.                                       No Fractional Shares or Scrip. 
No fractional shares or scrip representing fractional shares shall be
issued upon the exercise of this Warrant. 
With respect to any fraction of a share called for upon the exercise of
this Warrant, an amount equal to such fraction multiplied by the then current
price at which each Share may be purchased hereunder shall be paid in cash to
the Holder.

 

4.                                       Charges, Taxes and Expenses. 
Issuance of certificates for Shares upon the exercise of this Warrant
shall be made without charge to the Holder hereof for any issue or transfer tax
or other incidental expense in respect of the issuance of such certificate, all
of which taxes and expenses shall be paid by the Company, and such certificates
shall be issued in the name of the Holder.

 

5.                                       No Rights as Stockholder. 
This Warrant does not entitle the Holder to any voting rights or
other rights as a stockholder of the Company prior to the exercise hereof.

 

6.                                       Loss, Theft, Destruction or Mutilation of
Warrant.  On receipt of evidence satisfactory to the
Company of the loss, theft, destruction or mutilation of this Warrant and, in
the case of loss, theft or destruction, on delivery of an indemnity agreement
satisfactory in form and substance to the Company or, in the case of
mutilation, on surrender and cancellation of this Warrant, the Company at its
expense shall execute and deliver, in lieu of this Warrant, a new warrant of
like tenor and amount.

 

7.                                       Saturdays, Sundays, Holidays, etc. 
If the last or appointed day for the taking of any action or the
expiration of any right required or granted herein shall be a Saturday, a
Sunday or a legal holiday, then such action may be taken or such right may be
exercised on the next succeeding day not a Saturday, Sunday or legal holiday.

 

8.                                       Adjustments. 
The Exercise Price and the number of Shares purchasable hereunder are
subject to adjustment from time to time as set forth in this Section 8.

 

(a)                                  Reclassification, etc. 
If the Company, at any time while this Warrant, or any portion hereof,
remains outstanding and unexpired by reclassification of securities or
otherwise, shall change any of the securities as to which purchase rights under
this Warrant exist into the same or a different number of securities or any
other class or classes, this Warrant shall thereafter represent the right to
acquire such number and kind of securities as would have been issuable as the
result of such change with respect to the securities that were subject to the
purchase rights under this Warrant immediately prior to such reclassification
or other change and the Exercise Price therefor shall be appropriately
adjusted, all subject to further adjustment as provided in this Section 8.

 

3

 

(b)                                 Subdivision or Combination of Shares. 
In the event that the Company shall at any time subdivide the
outstanding securities as to which purchase rights under this Warrant exist, or
shall issue a stock dividend on the securities as to which purchase rights
under this Warrant exist, the number of securities as to which purchase rights
under this Warrant exist immediately prior to such subdivision or to the
issuance of such stock dividend shall be proportionately increased, and the
Exercise Price shall be proportionately decreased, and in the event that the
Company shall at any time combine the outstanding securities as to which
purchase rights under this Warrant exist, the number of securities as to which
purchase rights under this Warrant exist immediately prior to such combination
shall be proportionately decreased, and the Exercise Price shall be
proportionately increased, effective at the close of business on the date of
such subdivision, stock dividend or combination, as the case may be.

 

(c)                                  Cash Distributions. 
No adjustment on account of cash dividends or interest on the securities
as to which purchase rights under this Warrant exist will be made to the
Exercise Price under this Warrant.

 

9.                                       Restrictions on Transferability of
Securities.

 

(a)                                  Restrictions on Transferability. 
This Warrant and the Shares issuable upon exercise of this Warrant
(collectively the “Securities”) shall not be sold, assigned, transferred
or pledged except upon the conditions specified in this Section 9.

 

(b)                                 Restrictive Legend. 
Each certificate representing the Securities and any other securities
issued in respect of the Securities upon any stock split, stock dividend,
recapitalization, merger, consolidation or similar event, shall (unless otherwise
permitted by the provisions of Section 9(c)) be stamped or otherwise
imprinted with a legend in the following form (in addition to any legend
required under applicable state securities laws):

 

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR QUALIFIED UNDER APPLICABLE
STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED
OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER SUCH ACT AND QUALIFIED UNDER
APPLICABLE STATE SECURITIES LAWS, OR UNLESS THE CORPORATION HAS RECEIVED AN
OPINION OF COUNSEL OR OTHER EVIDENCE, REASONABLY SATISFACTORY TO THE
CORPORATION AND ITS COUNSEL, THAT SUCH REGISTRATION OR QUALIFICATION IS NOT
REQUIRED.

 

THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
RESTRICTIONS ON TRANSFER, INCLUDING A 180 DAY MARKET STANDOFF RESTRICTION, AS
SET FORTH IN A STOCK PURCHASE WARRANT ISSUED BY THE CORPORATION TO THE ORIGINAL
HOLDER OF THIS CERTIFICATE.  SUCH
RESTRICTIONS ARE BINDING ON TRANSFEREES OF THIS

 

4

 

CERTIFICATE.  A COPY OF SUCH
WARRANT MAY BE OBTAINED BY WRITTEN REQUEST MADE BY THE HOLDER OF RECORD OF
THIS CERTIFICATE TO THE SECRETARY OF THE CORPORATION AT THE PRINCIPAL EXECUTIVE
OFFICES OF THE CORPORATION.

 

Each
holder of Securities and each subsequent transferee consents to the Company
making a notation on its records and giving instructions to any transfer agent
of the Securities in order to implement the restrictions on transfer established
in this Section 9.

 

(c)                                  Notice of Proposed Transfers. 
Each holder of a warrant or stock certificate, as the case may be,
representing the Securities, by acceptance thereof, agrees to comply in all
respects with the provisions of this Section 9(c).  Such holder agrees not to make any
disposition of all or any portion of the Securities unless and until (X) there
is then in effect a registration statement under the Securities Act of 1933, as
amended (the “Securities Act”) covering such proposed disposition and
such disposition is made in accordance with such registration statement or (Y) such
holder shall have notified the Company of the proposed disposition and shall
have furnished the Company with a detailed statement of the circumstances
surrounding the proposed disposition, and if reasonably requested by the
Company, such holder shall have furnished the Company with an opinion of
counsel, reasonably satisfactory to the Company that such disposition will not
require registration of such shares under the Securities Act.

 

10.                                 Investment Representations and Covenants
of the Holder.  With respect to the acquisition of any of the
Securities, the Holder hereby represents and warrants to the Company as
follows:

 

(a)                                  Experience.  The Holder is
capable of evaluating the merits and risks of its investment in the Company and
has the capacity to protect its own interests.

 

(b)                                 Investment.  The Holder is
acquiring the Securities for investment for its own account, not as a nominee
or agent, and not with the view to, or for resale in connection with, any
distribution thereof.  The Holder
understands that the Securities have not been, and will not be, registered
under the Securities Act by reason of a specific exemption from the
registration provisions of the Securities Act, the availability of which
depends upon, among other things, the bona fide nature of the investment intent
and the accuracy of the Holder’s representations as expressed herein.

 

(c)                                  Rule 144. 
The Holder acknowledges that the Securities must be held indefinitely
unless subsequently registered under the Securities Act, or unless an exemption
from such registration is available.  The
Holder understands that the Company is not under any obligation to register any
of the Securities.  The Holder is aware
of the provisions of Rule 144 promulgated under the Securities Act that
permit limited resale of securities purchased in a private placement subject to
satisfaction of certain conditions.

 

11.                                 Market Standoff. 
The Holder hereby agrees that it will not, without the prior written
consent of the managing underwriter, during the period commencing on the date
of the final prospectus relating to the Company’s initial public offering and
ending on the date specified by the Company and the managing underwriter (such
period not to exceed one hundred eighty (l80)

 

5

 

calendar days) (i) lend,
offer, pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant to
purchase, or otherwise transfer or dispose of, directly or indirectly, any
securities of the Company, including (without limitation) shares of Common
Stock or any securities convertible into or exercisable or exchangeable for
Common Stock (whether now owned or hereafter acquired) or (ii) enter into
any swap or other arrangement that transfers to another, in whole or in part,
any of the economic consequences of ownership of any securities of the Company,
including (without limitation) shares of Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock (whether now
owned or hereafter acquired), whether any such transaction described in
clause (i) or (ii) above is to be settled by delivery of securities,
in cash or otherwise.  The Holder agrees to execute an agreement(s) reflecting
(i) and (ii) above as may be requested by the managing underwriters
at the time of the initial public offering, and further agrees that the Company
may impose stop transfer instructions with its transfer agent in order to
enforce the covenants in (i) and (ii) above.  The underwriters in connection with
the Company’s initial public offering are intended third party beneficiaries of
the covenants in this subsection and shall have the right, power and authority
to enforce such covenants as though they were a party hereto.

 

12.                                 Early Termination. 
The purchase rights represented by this Warrant shall terminate and be
of no further force and effect upon the first to occur of (a) the closing
of the Company’s first firm commitment underwritten public offering of its
Common Stock or other securities pursuant to an effective registration
statement under the Securities Act or (b) the closing of a Change of
Control.

 

13.                                 Notices.  In the event (i) the
Company shall take a record of the holders of the securities at the time
receivable upon the exercise of this Warrant for the purpose of entitling them
to receive any dividend or other distribution, or any right to subscribe for or
purchase any shares of stock of any class or any other securities, or to
receive any other right, (ii) of any capital reorganization of the
Company, (iii) of any reclassification of the capital stock of the
Company, (iv) of any Change of Control or (v) of any voluntary
dissolution, liquidation or winding-up of the Company, then, and in each such
case, the Company will mail or cause to be mailed to the Holder a notice
specifying, as the case may be, (A) the date on which a record is to be
taken for the purpose of such dividend, distribution or right, and stating the
amount and character of such dividend, distribution or right, or (B) the
date on which such reorganization, reclassification, Change of Control,
dissolution, liquidation or winding-up is to take place, and the time, if any
is to be fixed, as of which the holders of the securities at the time
receivable upon the exercise of this Warrant shall be entitled to exchange such
securities for the securities or other property deliverable upon such reorganization,
reclassification, Change of Control, dissolution, liquidation or
winding-up.  Such notice shall be mailed
at least five (5) days prior to the date therein specified.

 

14.                                 Miscellaneous.

 

(a)                                  Governing Law. 
THIS AGREEMENT SHALL BE GOVERNED IN ALL RESPECTS BY THE LAWS OF THE
STATE OF TEXAS AS SUCH LAWS ARE APPLIED TO AGREEMENTS BETWEEN TEXAS RESIDENTS
ENTERED INTO AND TO BE PERFORMED ENTIRELY WITHIN TEXAS, WITHOUT REGARD TO
CONFLICT OF LAWS RULES.

 

6

 

(b)                                 Restrictions. 
By acceptance hereof, the Holder acknowledges that the Shares acquired
upon the exercise of this Warrant may have restrictions upon its resale imposed
by state and federal securities laws.

 

(c)                                  Waivers and Amendments. This Warrant and any provisions hereof
may be changed, waived, discharged or terminated only by an instrument in
writing signed by the party against which enforcement of the same is sought.

 

(d)                                 Assignment.  This Warrant
may be assigned or transferred by the Holder only with the prior written
approval of the Company.  This Warrant
shall be binding upon any successors or assigns of the Company.

 

(e)                                  Notices.  All notices
and other communications required or permitted hereunder shall be in writing
and shall be delivered personally by hand or by courier, mailed by United
States first-class mail, postage prepaid, sent by facsimile or sent by
electronic mail directed to the party to be notified at the address, facsimile
number or electronic mail address indicated for such person on the signature page hereof,
or at such other address, facsimile number or electronic mail address as such
party may designate by ten (10) days’ advance written notice to the other
parties hereto.  All such notices and
other communications shall be deemed given upon personal delivery, on the date
of mailing, upon confirmation of facsimile transfer or when directed to the
electronic mail address set forth on signature page hereof.  With respect to any notice given by the
Company under any provision of the Texas General Corporation Law or the Company’s
charter or bylaws, the Holder agrees that such notice may given by facsimile or
by electronic mail.

 

(f)                                    Counterparts. 
This Warrant may be executed in any number of counterparts, each of
which shall be enforceable, and all of which together shall constitute one
instrument.

 

7

 

IN WITNESS WHEREOF, the Company has caused this Warrant to be executed
by its officer thereunto duly authorized.

 

	
   

  	
   

  	
  Convio, Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  ./s/ Gene Austin

  
	
   

  	
   

  	
   

  	
  Gene Austin, Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Address:

  
	
   

  	
   

  	
  11921 North MoPac Expressway, Suite 200

  
	
   

  	
   

  	
  Austin, TX 78759

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  AGREED AND ACKNOWLEDGED:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Entrepreneurs Foundation of Central Texas

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  (fka Austin Entrepreneurs Foundation)

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Eugene Sepulveda, Interim Executive Director

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Address

  	
   

  	
   

  
	
  PO Box 684826

  	
   

  	
   

  
	
  Austin, TX 78768

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Facsimile #: (512) 233-2366

  	
   

  	
   

  

 

 

NOTICE OF EXERCISE

 

TO:                      Convio, Inc.

11921 North MoPac
Expressway, Suite 200

Austin, TX  78759 USA

ATTN:  Secretary

 

1.                                       The undersigned hereby elects to purchase
                            
shares of the Common Stock (the “Shares”) of Convio, Inc. pursuant
to the terms of the attached Warrant, and tenders herewith payment of the
purchase price in full.

 

2.                                       Please issue a certificate or
certificates representing the Shares in the name of the undersigned or in such
other name as is specified below:

 

	
   

  
	
  (Print Name)

  
	
  Address:                            

  
	
   

  
	
   

  

 

3.                                       The undersigned confirms that the Shares
are being acquired for the account of the undersigned for investment only and
not with a view to, or for resale in connection with, the distribution thereof
and that the undersigned has no present intention of distributing or selling
the Shares.

 

	
   

  	
   

  	
   

  
	
  (Date)

  	
   

  	
  (Signature)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (Print Name)

  

 

 

NOTICE OF CONVERSION

 

TO:                      Convio, Inc.

11921 North MoPac
Expressway, Suite 200

Austin, TX  78759 USA

ATTN:  Secretary

 

1.                                       The undersigned hereby elects to convert
the attached Warrant into                     
shares of the                                   
Stock (the “Shares”) of Convio, Inc. pursuant to Section 1(b) of
such Warrant, which conversion shall be effected pursuant to the terms of the
attached Warrant.

 

2.                                       Please issue a certificate or
certificates representing the Shares in the name of the undersigned or in such
other name as is specified below:

 

	
   

  
	
  (Print Name)

  
	
   

  
	
  Address:                            

  
	
   

  
	
   

  

 

3.                                       The undersigned represents that the
Shares are being acquired for the account of the undersigned for
investment and not with a view to, or for resale in connection with, the
distribution thereof and that the undersigned has no present intention of
distributing or reselling such shares.

 

	
   

  	
   

  	
   

  
	
  (Date)

  	
   

  	
  (Signature)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (Print Name)Exhibit 4.8

 

THIS WARRANT AND THE SECURITIES
ISSUABLE UPON THE EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR UNDER THE SECURITIES LAWS OF ANY STATE.  THEY MAY NOT BE SOLD, OFFERED FOR SALE,
TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO (1) AN EFFECTIVE
REGISTRATION STATEMENT UNDER SUCH ACT, (2) A SALE MADE PURSUANT TO RULE
144 UNDER SUCH ACT OR (3) AN OPINION OF COUNSEL SATISFACTORY TO THE
COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT, OR ANY SUCH LAW.

 

PREFERRED
STOCK WARRANT

OF

CONVIO,
INC.

 

July 2,
2004

 

This Warrant is issued to
Piper Jaffray & Co. (the
“Holder”), by Convio, Inc., a Delaware
corporation (the “Company”), for
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged.

 

1.                                     Purchase of Securities. 
Subject to the terms and conditions hereinafter set forth, the Holder
shall be entitled, at any time during the Exercise Period (as set forth in Section 2
below), to purchase from the Company 273,115 shares (the “Shares”)
of Series D Convertible Preferred Stock (the “Preferred
Stock”) at a price of $1.65864 per share, subject to adjustment
pursuant to Section 7 below ( the “Warrant
Price”).

 

2.                                     Exercise Period. 
This Warrant shall be exercisable by the Holder for a term (the “Exercise Period”) beginning on the date hereof and ending on
the earlier of (i) the seventh annual anniversary date from the date of
the issuance of this Warrant at 5:00 p.m. Central Standard Time; (ii) the
sale of all or substantially all of the Company’s assets or the acquisition of
the Company by another entity by means of a consolidation or merger (other than
a consolidation or merger in which the holders of voting securities of the
Company immediately prior to the consolidation or merger own, immediately after
the consolidation or merger, voting securities of the surviving or acquiring
entity, or a parent of such entity, representing more than 50% of the voting
power of the surviving or acquiring entity or such parent) resulting in the
exchange of the outstanding shares of the Company for securities or
consideration issued, or caused to be issued, by the acquiring entity; and (iii) where
applicable, the second anniversary of the closing of the sale of the Company’s
securities pursuant to a firm commitment underwritten public offering pursuant
to the Securities Act of 1933, as amended (the “Securities
Act”) with aggregate gross proceeds to the Company of not less than
$20,000,000 and which results in
mandatory conversion of the Preferred Stock; provided, however, that in
the case of clause (ii) or (iii), the Holder shall be given not less than
ten (10) business days prior written notice of such event.

 

3.                                     Method of Exercise. 
While this Warrant remains outstanding and exercisable, the Holder may
exercise, in whole or in part, the purchase rights evidenced hereby.  Such exercise shall be effected by:

 

(a)                                  the surrender of this Warrant, together
with (i)  a duly executed copy of the Notice of Exercise attached hereto
as Appendix I to the Secretary of the Company at its principal offices, 

 

 

and (ii)  the payment to the Company, by check or
wire transfer, of an amount equal to the aggregate Warrant Price for the number
of Shares being purchased; or

 

(b)                                 Net exercise as provided in Section 4.

 

4.                                     Net Exercise. 
In lieu of exercising this Warrant or any portion hereof as provided in Section 3,
the Holder may elect to receive shares of Preferred Stock equal to the value of
this Warrant (or the portion thereof being canceled) by surrender of this
Warrant at the principal office of the Company together with a duly executed
Notice of Conversion in the form attached hereto as Appendix II, in
which event the Company shall issue to the Holder (or his designee) a number of
shares of Preferred Stock computed using the following formula:

 

X = (Y)(A-B)/A

 

where                                                              X =                             the number of Shares to be issued to the Holder for
the portion of the Warrant being converted.

 

Y =                            the total number of Shares issuable upon
exercise of the Warrant in full.

 

A =                          the fair market value of one Share which
shall mean (i) the fair market value of the Company’s stock issuable upon
conversion of such share as of the last business day immediately prior to the
date the notice of conversion is received by the Company, as determined in good
faith by the Company’s Board of Directors, or (ii) if this Warrant is
being converted in conjunction with a public offering of stock the price to the
public per share pursuant to the offering.

 

B =                            the Warrant Price on the date of
conversion.

 

Any portion of this
Warrant that is converted under this Section 4 shall be immediately
canceled.  This Warrant or any portion
hereof shall be deemed to have been converted immediately prior to the close of
business on the date of its surrender for conversion as provided above, and the
person entitled to receive the Shares issuable upon such conversion shall be
treated for all purposes as Holder of such shares of record as of the close of
business on such date.  As promptly as
practicable after such date, the Company shall issue and deliver to the person
or persons entitled to receive the same a certificate or certificates for the
number of full Shares issuable upon such conversion.  If the Warrant shall be converted for less
than the total number of Shares then issuable upon conversion, promptly after
surrender of the Warrant upon such conversion, the Company will execute and
deliver a new Warrant, dated the date hereof, evidencing the right of the
Holder to the balance of the Shares purchasable hereunder upon the same terms
and conditions set forth herein.

 

5.                                     Certificates for Shares. 
Upon the exercise of the purchase rights evidenced by this Warrant, the
Holder shall immediately be deemed a Holder of the Shares so purchased, and one
or more certificates for the number of Shares so purchased shall be issued in
the name of the Holder as soon as practicable following the receipt of the
completed Notice of Exercise or Notice of Conversion, as applicable, and
payment of the purchase price for such Shares, and in any event within thirty
(30) days thereafter.  The Company shall
not be required to issue any fractional shares upon the exercise of the Holder’s
purchase rights under this Warrant; in lieu of any fractional shares, the
Company shall pay cash equal to such fraction multiplied by the per share
Warrant Price.

 

2

 

6.                                     Reservation of Shares. 
The Company covenants that, during the Exercise Period, the Company will
reserve from its authorized and unissued shares a sufficient amount to provide
for the issuance of the Shares and for conversion of the Shares into the
Company’s Common Stock.  The Company
further covenants that such Shares, when issued pursuant to the exercise of
this Warrant, will, upon issuance, be duly and validly issued, fully paid and
nonassessable and free from all taxes, liens and charges with respect to the
issuance thereof.

 

7.                                     Adjustment of Warrant Price and Number of
Shares.  The number of and kind of securities
purchasable upon exercise of this Warrant, and the Warrant Price therefor,
shall be subject to adjustment from time to time as follows:

 

(a)                                  Subdivisions, Combinations and Other
Issuances.  If the Company shall at any time prior to the
expiration of this Warrant subdivide its outstanding capital stock, by split-up
or otherwise, or combine its outstanding capital stock, or issue additional
shares of its capital stock as a dividend with respect to any shares of capital
stock, the number of Shares issuable upon the exercise of this Warrant shall
forthwith be proportionately adjusted. 
Appropriate adjustments shall also be made to the Warrant Price, but the
aggregate purchase price payable for the total amount of Shares purchasable
under this Warrant (as adjusted) shall remain the same.  Any adjustment under this Section 7(a) shall
become effective at the close of business on the date the subdivision or
combination becomes effective, or as of the record date of such dividend, or in
the event that no record date is fixed, upon the making of such dividend.

 

(b)                                 Reclassification, Exchange and
Substitution.  If the Shares issuable upon exercise of this
Warrant shall be changed into a different form or class of securities of the
Company, whether by capital reorganization, reclassification, or otherwise
(other than a subdivision or combination of shares provided for above), the
Holder of this Warrant shall, on its exercise, be entitled to purchase, in lieu
of the Shares that the Holder would have become entitled to purchase but for
such change, an amount of such other securities equivalent to the amount that
the Holder would have received had this Warrant been exercised immediately
before that change, all subject to further adjustment as provided in paragraphs
(a) and (c) hereof.

 

(c)                                  Reorganizations, Mergers, Consolidations
or Sale of Assets.  If at any time there shall be a capital
reorganization of the Company’s outstanding equity securities (other than a
combination, reclassification, exchange, or subdivision of shares provided for
elsewhere in this Warrant) or merger or consolidation of the Company with or
into another corporation (other than a merger or consolidation described in Section 2
hereof), as a part of such capital reorganization, merger or consolidation,
lawful provision shall be made so that the Holder of this Warrant shall
thereafter be entitled to receive upon exercise of this Warrant, during the
period specified in this Warrant and upon payment of the Warrant Price then in
effect, the number of shares of stock or other securities or property of the
Company, or of the successor corporation resulting from such merger or
consolidation, to which a holder of the Shares issuable upon exercise of this
Warrant would have been entitled in such capital reorganization, merger or
consolidation if this Warrant had been exercised immediately prior
thereto.  In any such case, appropriate
adjustment (as determined by the Company’s Board of Directors) shall be made in
the application of the provisions of this Warrant with respect to the rights
and interests of the Holder of this Warrant after the capital reorganization,
merger or consolidation such that the provisions of this Warrant (including
adjustment of the Warrant Price then in effect and number of shares purchasable
upon exercise of this Warrant) shall be applicable after that event, as near as
reasonably may be, in relation to any shares or other property deliverable
after that event upon exercise of this Warrant. 

 

3

 

The provisions of this paragraph shall similarly apply
to successive capital reorganizations, mergers or consolidations.

 

(d)                                 Adjustments for Diluting Issuances. 
In the event of the issuance by the Company, after the date of issuance
of this Warrant, of Additional Shares of Common (as defined in the Company’s
Fourth Amended and Restated Certificate of Incorporation, as hereinafter
amended from time to time (the “Restated Certificate”))
without consideration or for a consideration per share less than the Warrant
Price in effect on the date of an immediately prior to such issue (a “Diluting Issuance”), then the number of shares of the
Company’s Common Stock issuable upon conversion of the Shares will be adjusted
in accordance with those provisions of the Restated Certificate that apply to
the adjustment of the Series D Conversion Price (as defined in the
Restated Certificate) upon the issuance of Additional Shares of Common without
consideration or for a consideration per share less than the Series D
Conversion Price then in effect.  Under
no circumstances shall the aggregate Warrant Price payable by the Holder upon
exercise of the warrant increase as a result of any adjustment arising from a
Diluting Issuance.

 

(e)                                  Notice of Adjustments. 
The Company shall give notice of each adjustment or readjustment of the
amount of Shares or other securities issuable upon exercise of this Warrant and
the Warrant Price to the registered Holder of this Warrant at that Holder’s
address as shown on the Company’s books within thirty (30) days after the
occurrence of the event resulting in such adjustment.

 

(f)                                    No Change Necessary. 
The form of this Warrant need not be changed because of any adjustment
in the amount of Shares issuable upon its exercise.  A Warrant issued after any adjustment upon
any partial exercise or in replacement may continue to express the same amount
of Shares (appropriately reduced in the case of partial exercise) as are stated
in this Warrant as initially issued, and that number of shares shall be
considered to have been so changed at the close of business on the date of
adjustment.

 

8.                                     No Rights as a Shareholder. 
Prior to the exercise of this Warrant, the Holder shall not be entitled
to any rights of a shareholder with respect to the underlying Shares, including
(without limitation) the right to vote such Shares, receive dividends or other
distributions thereon, exercise preemptive rights or be notified of shareholder
meetings, and the Holder shall not be entitled to any notice or other
communication concerning the business or affairs of the Company.

 

9.                                     Registrations Under Securities Act of
1933, as Amended.  The Company agrees that the shares of common
stock of the Company into which the Shares are convertible shall be subject to
the registration rights set forth on Exhibit A hereto.

 

10.                               Exercise, Transfer and Exchange
Restrictions.  The transfer, surrender or exchange of any of
this Warrant or the Shares issued upon the exercise hereof is subject to any
restrictions on transfer imposed by state and Federal securities laws.  Any Warrant or certificate representing
Shares shall bear any legend considered necessary to comply with the Securities
Act and other applicable state securities laws, including substantially the
following:

 

4

 

“THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE
EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR UNDER THE SECURITIES LAWS OF ANY STATE.  THEY MAY NOT BE SOLD, OFFERED FOR SALE,
TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO (1) AN EFFECTIVE
REGISTRATION STATEMENT UNDER SUCH ACT, (2) A SALE MADE PURSUANT TO RULE
144 UNDER SUCH ACT OR (3) AN OPINION OF COUNSEL SATISFACTORY TO THE
COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT, OR ANY SUCH LAW”.

 

11.                               Representation of Holder. 
By acceptance of this Warrant, Holder represents to the Company that by
reason of its business and financial experience it has the capacity to protect
its own interests in this transaction and it is accepting this Warrant for its
own account and not with a view to its resale or distribution.

 

12.                               Loss, Theft, Mutilation, etc. 
Upon receipt of evidence reasonably satisfactory to the Company of the
loss, theft, destruction or mutilation of this Warrant and, in the case of any
such loss, theft or destruction, upon delivery of an indemnity agreement
reasonably satisfactory in form and amount to the Company or, in the case of
any such mutilation, upon surrender and cancellation of this Warrant, the
Company at its expense will execute and deliver, in lieu thereof, a new Warrant
of like tenor.

 

13.                               Notices.  Notices
pursuant to this Warrant shall be in writing and shall be deemed to have been
duly given upon delivery if delivered in person by e-mail, or by telecopy or 72
hours after deposit in the United States mail, postage prepaid, addressed (i) if
to the Company, at its principal executive office, and (ii) if to the
Holder, at its address as set forth in the records of the Company, or such
other address as either the Company or the Holder may designate by written
notice to the other.

 

14.                               Governing Law; Consent to Jurisdiction. 
This Warrant shall be governed in all respects by the laws of the State
of Texas applicable to contracts
entered into and wholly to be performed in Texas by Texas
residents. The Holder agrees to submit to the jurisdiction of the federal and
state courts of the State of Texas with respect to the breach or interpretation
of this Warrant or the enforcement of any and all rights, duties, liabilities,
obligations, powers, and other relations between the parties arising under this
Warrant.

 

[The remainder of
this page is intentionally left blank.]

 

5

 

IN WITNESS WHEREOF, the Company has caused this
Warrant to be executed by its duly authorized officer.

 

	
  Dated: July 2, 2004

  	
  CONVIO, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gene Austin

  
	
   

  	
   

  	
  Gene Austin, President and CEO

  

 

[SIGNATURE PAGE TO
PREFERRED STOCK WARRANT]

 

6

 

EXHIBIT A

 

Registration Rights

 

The shares of common stock of the Company issuable upon conversion of
the Shares shall be deemed “registrable securities” or otherwise entitled to “piggy
back” registration rights in accordance with the terms of the following
agreement (the “Agreement”) between the Company and its investor(s):

 

Third Amended and Restated Investors’ Rights Agreement dated July 2,
2004 by and among the Company, those holders of Common Stock listed on Schedule
I thereto, those holders of Preferred Stock listed on Schedule II thereto, and
each of those key employees listed on Schedule III thereto.

 

The Company agrees that no amendments will be made to the Agreement
that would have a unique and adverse impact on Holder’s registration rights
thereunder without the consent of Holder. 
By acceptance of the Warrant to which this Exhibit A is attached,
Holder shall be deemed to be a party to the Agreement for purposes of Section 6
thereof relating to piggy-back rights.

 

 

APPENDIX I

 

NOTICE OF EXERCISE

 

Convio, Inc.

 

 

 

Attention:                                       Corporate Secretary

 

1.                                     The undersigned hereby elects to
purchase, pursuant to the provisions of the Preferred Stock Warrant issued by Convio, Inc. (the “Company”) and held
by the undersigned,                  
shares of Preferred Stock of the Company, by exercise of           
percent (        %) of the Preferred
Stock Warrant.

 

2.                                     Payment of the purchase price per share
required under such Warrant accompanies this Subscription.

 

3.                                     Please issue a certificate or
certificates representing said shares of Preferred Stock in the name of the
undersigned or in such other name as is specified below:

 

	
   

  	
   

  	
   

  
	
   

  	
  (Name)

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Address)

  	
   

  
	
   

  	
                                         

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
                                         

  	
   

  

 

Dated:
                   
,

 

	
   

  	
  Signature:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Address:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  

 

 

APPENDIX II

 

NOTICE OF
CONVERSION

 

Convio, Inc.

 

 

 

Attn:                    Secretary of Company

 

1.                                     The undersigned hereby elects to acquire                   
shares of the Preferred Stock of Convio, Inc.
(the “Company”) pursuant to the terms of the Preferred Stock Warrant issued by
the Company and held by the undersigned, by conversion of
              
percent (       %) of the Preferred Stock
Warrant.

 

2.                                     Please issue a certificate or
certificates representing said shares of Preferred Stock in the name of the
undersigned or in such other name as is specified below:

 

	
   

  	
   

  	
   

  
	
   

  	
  (Name)

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Address)

  	
   

  
	
   

  	
                                         

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
                                         

  	
   

  

 

Dated:
                   
,

 

	
   

  	
  Signature:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Address:

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