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EXHIBIT 4.2
FORM OF OPTION TO PURCHASE COMMON STOCK
Date of Issuance: __________ Option to Purchase An Aggregate of _____ shares
of Common Stock
FOR VALUE RECEIVED, Visual Data Corporation, a Florida corporation (the
"Company") promises to issue in the name of, and sell and deliver to _________
(the "Holder") a certificate or certificates for an aggregate of ________ shares
of the Company's common stock, par value $.0001 per share (the "Common Stock"),
upon payment by the Holder of the exercise price per share of $______ (the
"Exercise Price") in lawful funds of the United States of America, with the
Exercise Price being subject to adjustment in the circumstances set forth below.
Section 1.
EXERCISE OF OPTION
1.1 EXERCISE PERIOD. The Holder may exercise this Option, in whole or
in part (but not as to fractional shares), at any time and time to time
commencing upon the Vesting Date and ending at 5:00 p.m., Eastern Time, on the
_________ anniversary of the Vesting Date (the "Exercise Period").
1.2 EXERCISE PROCEDURE.
a. This Option 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 Option will be delivered by the Company to the Purchaser within
five (5) business days after the Exercise Date. Unless this Option has expired
or all of the purchase rights represented hereby have been exercised, the
Company will prepare a new Option representing the rights formerly represented
by this Option that have not expired or been exercised. The Company will, within
such five (5) day period, deliver such new Option to the Holder at the address
set forth in this Option.
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c. The shares of Common Stock issuable upon the exercise of
this Option 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 Option 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
Option, 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 Option pursuant to the provisions of Section 6
hereof, the shares of Common Stock issuable upon the exercise of this Option
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 Option, 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 bid price of the Company's Common Stock as reported on
The Nasdaq Stock Market, or the principal exchange on which the Company's Common
Stock is then traded, as of the close of business on the Exercise Date.
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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 Option
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 Option 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 Option, 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
Option, 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 Option 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 Option 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 Option.
2.3 NOTICE OF ADJUSTMENT. Whenever the number of shares of Common Stock
purchasable upon exercise of this Option 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 Options on any day during normal business
hours.
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 Option. Upon exercise of this Option 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.
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Section 4.
NO SHAREHOLDER RIGHTS OR OBLIGATIONS
This Option 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 Option 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 Option and the issuance of the
Common Stock is accomplished as expeditiously as possible. No provision of this
Option, in the absence of affirmative action by the Holder to purchase Common
Stock, and no enumeration in this Option 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 Option and all rights hereunder are
transferrable, in whole or in part, upon surrender of this Option with a
properly executed Assignment in the form of Exhibit 2 hereto at the principal
offices of the Company. This Option 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 Option with respect to any resale or other
disposition of such securities; provided that no such agreement shall be
required from any person purchasing this Option or the underlying shares of
Common Stock pursuant to a registration statement effective under the Act. The
Holder of this Option 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,
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.
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Section 6.
REGISTRATION RIGHTS
If at any time during the Exercise Period, the Company shall prepare
and file one or more registration statements under the Act with respect to a
public offering of equity or debt securities of the Company, or of any such
securities of the Company held by its security holders, other than a
registration statement on Forms S-4, S-8, or similar form, the Company will
include in any such registration statement such information as is required, and
such number of shares of Common Stock held by, or shares of Common Stock
underlying outstanding Options held by, the Holder to permit a public offering
of such shares of Common Stock as required; provided, however, that if, in the
sole discretion of the Company, the inclusion of the shares requested to be
registered, when added to the securities being registered by the Company or the
selling security holder(s), would exceed, in the opinion of management of the
Company, the maximum amount of the Company's securities that can be marketed
without otherwise materially and adversely affecting the entire offering, then
the Company may exclude from such offering that portion of the shares required
to be so registered so that the total number of securities to be registered is
within the maximum number of shares that may be marketed without otherwise
materially and adversely affecting the entire offering. The Company shall have
sole and absolute discretion in making such determination. The Company shall use
its best efforts to obtain promptly the effectiveness of such registration
statement and maintain the effectiveness thereof for at least 180 days and to
register or qualify the subject shares of Common Stock underlying this Option
for sale in the State of Florida. The Company shall bear all fees and expenses
other than the fees and expenses of Xxxxxx's counsel incurred in the preparation
and filing of such registration statement and related state registrations, to
the extent permitted by applicable law, and the furnishing of copies of the
preliminary and final prospectus thereof to such 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
Attention: Xxxxx X. Xxxxxx, President
With a copy to: Atlas Xxxxxxxx, P.A.
000 Xxxx Xxx Xxxx Xxxxxxxxx
Xxxxx 0000
Xxxx Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxx X. Xxxxxxxxx, Esq.
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If to the Holder:
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Attention:
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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 Option, 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 Option.
7.3 GOVERNING LAW. This Option is governed by, interpreted under and
construed in all respects in accordance with the substantive laws of the State
of Florida, without regard to the conflicts of law provision thereof, and
irrespective of the place of domicile or resident of the party. In the event of
a controversy arising out of the interpretation, construction, performance or
breach of this Option, the parties hereby agree and consent to the jurisdiction
and venue of the Courts of the State of Florida, or the United States District
Court for the Southern District of Florida; and further agree and consent that
personal service of process in any such action or preceding outside the State of
Florida shall be tantamount to service in person in Florida.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
VISUAL DATA CORPORATION
By:
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Xxxxx X. Xxxxxx, President
ATTEST:
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