EXHIBIT 4
WARRANT TO PURCHASE COMMON STOCK
Date of Issuance: August 11, 1998 Warrant to Purchase An Aggregate of
20,000 shares of Common Stock
FOR VALUE RECEIVED, Visual Data Corporation, a Florida corporation (the
"Company"), pursuant to the terms and conditions of that certain Security
Purchase Agreement of even date herewith (the "Agreement") by and between the
Company and WEC Investors IV LLC, a Delaware limited liability company (the
"Holder") promises to issue in the name of, and sell and deliver to the Holder a
certificate or certificates for an aggregate of 20,000 shares of the Company's
common stock, par value $.00001 per share (the "Common Stock"), upon payment by
the Holder of $4.00 per share (the "Exercise Price"), with the Exercise Price
being subject to adjustment in the circumstances set forth below.
Section 1.
Exercise of Warrant
1.1 Exercise Period. The Holder may exercise this Warrant, in whole or
in part (but not as to fractional shares), at any time and time to time
commencing upon the date hereof (the "Vesting Date") and ending at 5:00 p.m.,
Eastern Time, on the fourth (4th) anniversary of the Vesting Date (the "Exercise
Period").
1.2 Exercise Procedure.
a. This Warrant will be deemed to have been exercised at such
time as the Company has received all of the following items (the "Exercise
Date"):
i. a completed Exercise Agreement, in the form
attached hereto as Exhibit 1 hereto, executed by the Holder (the "Purchaser");
and
ii. a cashier's or official bank check or other
immediately available funds payable to the Company in an amount equal to the sum
of the product of the Exercise Price multiplied by the number of shares of
Common Stock being purchased upon such exercise.
b. Certificates for the shares of Common Stock purchased upon
exercise of this Warrant will be delivered by the Company to the Purchaser
within five (5) business days after the Exercise Date. Unless this Warrant has
expired or all of the purchase rights represented hereby have been exercised,
the Company will prepare a new Warrant representing the rights formerly
represented by this Warrant that have not expired or been
-1-
exercised. The Company will, within such five (5) day period, deliver such new
Warrant to the Holder at the address set forth in this Warrant.
c. The shares of Common Stock issuable upon the exercise of
this Warrant will be deemed to have been transferred to the Purchaser on the
Exercise Date, and the Purchaser will be deemed for all purposes to have become
the record holder of such Common Stock on the Exercise Date.
d. The issuance of certificates for shares of Common Stock
upon the exercise of this Warrant will be made without charge to the Purchaser
for any issuance tax in respect thereof or any other cost incurred by the
Company in connection with such exercise and related transfer of the shares;
provided, however, that the Company shall not be required to pay any tax that
may be payable in respect of any transfer involved in the issuance and delivery
of any certificate or instrument in a name other than that of the Holder of this
Warrant, and that the Company shall not be required to issue or deliver any such
certificate or instrument unless and until the person or persons requiring the
issue thereof shall have paid to the Company the amount of such tax or shall
have established to the satisfaction of the Company that such tax has been paid.
e. Unless the Company shall have registered the shares of
Common Stock underlying this Warrant pursuant to the provisions of Section 6
hereof, the shares of Common Stock issuable upon the exercise of this Warrant
have not been registered under the Securities Act of 1933, as amended (the
"Act") and, accordingly, will be "restricted securities" as that term is defined
in the Act. The Company may insert the following or similar legend on the face
of the certificates evidencing shares of Common Stock if required in compliance
with state securities laws:
"These securities have not been registered under any state securities laws and
may not be sold or otherwise transferred or disposed of except pursuant to an
effective registration statement under any applicable state securities laws, or
an opinion of counsel satisfactory to counsel to the Company that an exemption
from registration under any applicable state securities laws is available."
1.3 Fractional Shares. If a fractional share of Common Stock would, but
for the provisions of Subsection 1.1, be issuable upon exercise of the rights
represented by this Warrant, the Company will, within 30 days after the Exercise
Date, deliver to the Purchaser a check payable to the Purchaser, in lieu of such
fractional share, in an amount equal to the value of such fractional share as
determined by the closing price of the Company's Common Stock as reported on the
principal exchange on which the Company's Common Stock is then traded, as of the
close of business on the Exercise Date.
-2-
Section 2.
Effect of Reorganization, Reclassification, Consolidation, Merger or Sale
2.1 Recapitalization or Reclassification of Common Stock. In case the
Company shall at any time prior to the exercise or termination of this Warrant
effect a recapitalization or reclassification of such character that its Common
Stock shall be changed into or become exchangeable for a larger or smaller
number of shares, then, upon the effective date thereof, the number of shares of
Common Stock that the Holder of this Warrant shall be entitled to purchase upon
exercise hereof shall be increased or decreased, as the case may be, in direct
proportion to the increase or decrease in such number of shares of Common Stock
by reason of such recapitalization or reclassification, and the Exercise Price
of such recapitalized or reclassified Common Stock shall, in the case of an
increase in the number of shares, be proportionately decreased and, in the case
of a decrease in the number of shares, be proportionately increased.
2.2 Consolidation, Merger or Sale. In case the Company shall at any
time prior to the exercise of this Warrant, or the expiration of the Exercise
Period, whichever first occurs, consolidate or merge with any other corporation
(unless the Company shall be the surviving entity) or transfer all or
substantially all of its assets to any other corporation preparatory to a
dissolution, then the Company shall, as a condition precedent to such
transaction, cause effective provision to be made so that the Holder of this
Warrant, upon the exercise thereof after the effective date of such transaction,
shall be entitled to receive the kind and amount of shares, evidences of
indebtedness, and/or other property receivable on such transaction by a holder
of the number of shares of Common Stock as to which the Warrant was exercisable
immediately prior to such transaction (without giving effect to any restriction
upon such exercise); and, in any such case, appropriate provision shall be made
with respect to the rights and interests of the Holder hereof to the effect that
the provisions of this Warrant shall thereafter be applicable (as nearly as may
be practicable) with respect to any shares, evidences of indebtedness, or other
securities or assets thereafter deliverable upon exercise of this Warrant.
2.3 Notice of Adjustment. Whenever the number of shares of Common Stock
purchasable upon exercise of this Warrant shall be adjusted as provided herein,
the Company shall file with its corporate records a certificate of its Chief
Financial Officer setting forth the computation and the adjusted number of
shares of Common Stock purchasable hereunder resulting from such adjustments,
and a copy of such certificate shall be mailed to the Holder. Any such
certificate or letter shall be conclusive evidence as to the correctness of the
adjustment or adjustments referred to therein and shall be available for
inspection by the holders of the Warrants on any day during normal business
hours.
-3-
Section 3.
Reservation of Common Stock
The Company will at all time reserve and keep available such number of
shares of Common Stock as will be sufficient to permit the exercise in full of
this Warrant. Upon exercise of this Warrant pursuant to its terms, the Holder
will acquire fully paid and non-assessable ownership rights of the Common Stock,
free and clear of any liens, claims or encumbrances.
Section 4.
No Shareholder Rights or Obligations
This Warrant will not entitle the Holder hereof to any voting rights or
other rights as a shareholder of the Company. Until the shares of Common Stock
issuable upon the exercise of this Warrant are recorded as issued on the books
and records of the Company's transfer agent, the Holder shall not be entitled to
any voting rights or other rights as a shareholder; provided, however, the
Company uses its bests efforts to ensure that, upon receipt of the Exercise
Agreement and payment of the Exercise Price, the appropriate documentation
necessary to effectuate the exercise of the Warrant and the issuance of the
Common Stock is accomplished as expeditiously as possible. No provision of this
Warrant, in the absence of affirmative action by the Holder to purchase Common
Stock, and no enumeration in this Warrant of the rights or privileges of the
Holder, will give rise to any obligation of such Holder for the Exercise Price
or as a stockholder of the Company.
Section 5.
Transferability
Subject to the terms hereof, this Warrant and all rights hereunder are
transferrable, in whole or in part, upon surrender of this Warrant with a
properly executed Assignment in the form of Exhibit 2 hereto at the principal
offices of the Company. This Warrant and the underlying shares of Common Stock
may not be offered, sold or transferred except in compliance with the Act, and
any applicable state securities laws, and then only against receipt of an
agreement of the person to whom such offer or sale or transfer is made to comply
with the provisions of this Warrant with respect to any resale or other
disposition of such securities; provided that no such agreement shall be
required from any person purchasing this Warrant or the underlying shares of
Common Stock pursuant to a registration statement effective under the Act. The
Holder of this Warrant agrees that, prior to the disposition of any security
purchased on the exercise hereof other than pursuant to an registration
statement then effective under the Act, or any similar statute then in effect,
-4-
the Holder shall give written notice to the Company, expressing his intention as
to such disposition. Upon receiving such notice, the Company shall present a
copy thereof to its securities counsel. If, in the sole opinion of such counsel,
which such opinion shall not be unreasonably withheld, the proposed disposition
does not require registration of such security under the Act, or any similar
statute then in effect, the Company shall, as promptly as practicable, notify
the Holder of such opinion, whereupon the Holder shall be entitled to dispose of
such security in accordance with the terms of the notice delivered by the Holder
to the Company.
Section 6.
Registration Rights
The shares of Common Stock issuable upon exercise of this Warrant are
subject to registration under the Act pursuant to the terms and conditions of
that certain Registration Rights Agreement of even date herewith by and between
the Company and the Holder.
Section 7.
Miscellaneous
7.1 Notices. Any notices, requests or consents hereunder shall be
deemed given, and any instruments delivered, two days after they have been
mailed by first class mail, postage prepaid, or upon receipt if delivered
personally or by facsimile transmission, as follows:
If to the Company: 0000 XX 00 Xxxxxx
Xxxxxxx Xxxxx, Xxxxxxx 00000
With a copy to: Atlas, Xxxxxxxx, Trop & Borkson, P.A.
000 Xxxx Xxx Xxxx Xxxxxxxxx
Xxxxx 0000
Xxxx Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx, Esq.
If to the Holder: c/o West End Capital LLC
One World Trade Center
Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
-5-
With a copy to: Xxxxx Xxxxxxx Xxxxxxx & Xxxxx LLP
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxx, Esq.
except that any of the foregoing may from time to time by written notice to the
other designate another address which shall thereupon become its effective
address for the purposes of this paragraph.
7.2 Entire Agreement. This Warrant, including the exhibits and
documents referred to herein which are a part hereof, contain the entire
understanding of the parties hereto with respect to the subject matter and may
be amended only by a written instrument executed by the parties hereto or their
successors or assigns. Any paragraph headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Warrant.
7.3 Governing Law. The corporate laws of the State of Florida shall
govern all issues concerning the relative rights of the Company and its
stockholders. All other questions regarding the construction, validity,
enforcement and interpretation of this Warrant shall be governed by the internal
laws of the State of New York without regard to the principles of conflict of
laws. Each party hereby irrevocably submits to the non-exclusive jurisdiction of
the state and federal courts sitting the City of New York, Borough of Manhattan,
for the adjudication of any dispute hereunder or in connection herewith or with
any transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is brought in an inconvenient forum or that the
venue of such suit, action or proceeding is improper. Each party hereby
irrevocably waives personal service of process and consents to process being
served in any such suit, action or proceeding by mailing a copy thereof to such
party at the address for such notices to it under this Warrant and agrees that
such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law. If any provision of this
Warrant shall be invalid or unenforceable in any jurisdiction, such invalidity
or unenforceability shall not affect the validity or enforceability of the
remainder of this Warrant in that jurisdiction or the validity or enforceability
of any provision of this Warrant in any other jurisdiction.
-6-
IN WITNESS WHEREOF, this Warrant has been duly executed and the
corporate seal affixed hereto, all as of the day and year first above written.
VISUAL DATA CORPORATION
By:________________________________
Xxxxx X. Xxxxxx, President
ATTEST:
------------------------
-7-
EXHIBIT 1
EXERCISE AGREEMENT
To: Dated:
The undersigned record Holder, pursuant to the provisions set forth in
the within Warrant, hereby subscribed for and purchases shares of Common Stock
covered by such Warrant and hereby makes full cash payment of $ for such shares
at the Exercise Price provided by such Warrant.
______________________________
(Signature)
______________________________
(Print or type name)
______________________________
(Address)
______________________________
______________________________
NOTICE: The signature of this Exercise Agreement must correspond with
the name as written upon the face of the within Warrant, or upon the Assignment
thereof, if applicable, in every particular, without alteration, enlargement or
any change whatsoever.
EXHIBIT 2
ASSIGNMENT
FOR VALUE RECEIVED, , the undersigned Holder hereby sell, assigns, and
transfer all of the rights of the undersigned under the within Warrant with
respect to the number of shares of Common Stock issuable upon the exercise of
such Warrant set forth below, unto the Assignee identified below, and does
hereby irrevocable constituted and appoint to effect such transfer of rights on
the books of the Company, with full power of substitution:
Number of Shares
Name of Assignee Address of Assignee of Common Stock
--------------------------------------------------------------------------------
Dated:_________ ___________________________
(Signature of Holder)
___________________________
(Print or type name)
NOTICE: The signature of this Exercise Agreement must correspond with
the name as written upon the face of the within Warrant, or upon the Assignment
thereof, if applicable, in every particular, without alteration, enlargement or
any change whatsoever.
CONSENT OF ASSIGNEE
I HEREBY CONSENT to abide by the terms and conditions of the within
Warrant.
Dated:_________ ___________________________
(Signature of Assignee)
___________________________
(Print or type name)
