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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
FIRST ADVANTAGE CORPORATION
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(Name of Issuer)
Class A Common Stock
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(Title of Class of Securities)
31845F 10 0
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(CUSIP Number)
Harold Kahn, Chief Operating Officer.
Pequot Capital Management, Inc.
500 Nyala Farm Road, Westport, CT 06880
(203) 429-2200
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(Name, Address, and Telephone Number of Person Authorized to
Receive Notices and Communications)
June 5, 2003
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(Date of Event which Requires Filing of This Statement)
If the filing person has previously filed a statement on Schedule 13G
to report the acquisition that is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the
following box |_|.
Note. Schedules filed in paper format shall include a
signed original and five copies of the schedule, including all
exhibits. See Rule 13d-7 for other parties to whom copies are to be
sent.
The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities,
and for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
CUSIP No. 31845F 10 0
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1 NAMES OF REPORTING PERSONS
Pequot Capital Management, Inc.
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
06-1524885
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) n/a
(b) X*
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS
IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e)
n/a
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Connecticut
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NUMBER OF 7 SOLE VOTING POWER 2,203,267*
SHARES ----------------------------------------------------
BENEFICIALLY
OWNED BY 8 SHARED VOTING POWER 0*
THE ----------------------------------------------------
REPORTING
PERSON WITH 9 SOLE DISPOSITIVE POWER 2,203,267*
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10 SHARED DISPOSITIVE POWER 0*
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY THE REPORTING PERSON
2,203,267*
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11)
EXCLUDES CERTAIN SHARES n/a
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 11.0%*
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14 TYPE OF REPORTING PERSON IA
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*The Reporting Person may be deemed to be part of a group with The First
American Corporation ("FAMC") pursuant to certain terms of the Stockholders
Agreement described in Item 4. The Reporting Person does not affirm to be part
of a group and expressly disclaims beneficial ownership of the 16,027,286 FADV
B Shares (as defined herein) held by FAMC which are convertible on a one for
one basis into an equal amount of shares of FADV A Shares (as defined herein)
at any time in the absolute discretion of FAMC and on a mandatory basis upon
the occurrence of certain events specified in the Issuer's first amended and
restated certificate of incorporation. Such FADV A Shares are, accordingly,
not included in the amounts specified by the Reporting Person above.
Item 1. Security and Issuer
Class of Securities: Class A common stock, par value $.001
per share (the "FADV A Shares")
Issuer: First Advantage Corporation (the "Issuer")
805 Executive Center Drive West, Suite 300
St. Petersburg, Florida 33702
Item 2. Identity and Background
Name of Reporting Person: Pequot Capital Management, Inc.
(the "Reporting Person")
State of Incorporation: Connecticut
Principal Business: The Reporting Person is an investment adviser
registered under the Investment Advisers Act of 1940, and acts as investment
adviser to certain managed accounts over which the Reporting Person exercises
discretionary authority (the "Accounts"). The address of the principal
business and office, and of the Executive Officers, Director and Controlling
Person (as defined below) is 500 Nyala Farm Road, Westport, CT 06880.
The Reporting Person is the investment advisor/manager of, and
exercises sole investment discretion over, Pequot Private Equity Fund II,
L.P., a Delaware limited partnership (the "Fund"), one of the Accounts.
Lawrence D. Lenihan, Jr., a managing director of the Reporting Person, is a
member of the board of directors of the Issuer.
The executive officers of the Reporting Person are Mr. Arthur J.
Samberg, Ms. Sharon Haugh and Mr. Harold Kahn, the director of the Reporting
Person is Mr. Arthur J. Samberg, and the controlling shareholder is Mr. Arthur
J. Samberg (collectively, the "Executive Officers, Director and Controlling
Person"). Each of the Executive Officers, Director and the Controlling Person
is a citizen of the United States.
Neither the Reporting Person nor the Executive Officers, Director
and Controlling Person have, during the last five years, been convicted in a
criminal proceeding (excluding traffic violations or similar misdemeanors).
Neither the Reporting Person nor the Executive Officers, Director
and Controlling Person have, during the last five years, been a party to a
civil proceeding of a judicial or administrative body of competent
jurisdiction which resulted in a judgment, decree or final order enjoining
future violations of, or prohibiting or mandating activities subject to
federal or state securities laws or finding any violation with respect to such
laws.
Item 3. Source and Amount of Funds or Other Consideration
On June 5, 2003, all of the common stock of US Search.com, Inc.
("USS") beneficially owned by the Reporting Person was converted into 2,101,188
FADV A Shares, pursuant to an Agreement and Plan of Merger, dated as of
December 13, 2002 (the "Merger Agreement"), with FAMC, the Issuer and
Stockholm Seven Merger Corp., a Delaware corporation ("Merger Sub"), pursuant
to which, among other things, Merger Sub merged with and into USS (the
"Merger") and USS continued as the surviving corporation (the "Surviving
Corporation") and a wholly-owned subsidiary of the Issuer. In addition, all
outstanding warrants and options to purchase USS shares were assumed by the
Issuer and are exercisable into an aggregate of 97,193 FADV A Shares with
respect to the warrants and an aggregate of 5,829 FADV A Shares with respect
to the options (of which 4,886 are currently vested or vest within 60 days of
the date hereof). On June 5, 2003, at the effective time of the merger (the
"Effective Time"), the Reporting Person became a beneficial owner of 2,203,267
FADV A Shares and Mr. Lawrence D. Lenihan, Jr. was granted a seat on the Board
of Directors of the Issuer and, as described in Item 6 below, was granted an
option to purchase 5,000 shares of FADV A Shares (none of which are currently
vested nor will be vested within 60 days from the date hereof).
The description of the Merger Agreement contained in this Item 3
below does not purport to be complete and is qualified in its entirety by
reference to the Merger Agreement included as Exhibit 1 hereto and is
incorporated herein by reference.
Item 4. Purpose of Transaction
The Reporting Person acquired the FADV A Shares beneficially owned
by it pursuant to the terms of the Merger Agreement. The Reporting Person
considers the FADV A Shares as an investment made in the ordinary course of
its business. The Reporting Person intends to review on a continuing basis its
investment in the Issuer, including the Issuer's business, financial condition
and operating results and general market and industry conditions and, based
upon such review, may acquire additional FADV A Shares or dispose of FADV A
Shares in the open market, in privately negotiated transactions or in any
other lawful manner.
In consideration for the Merger, the Issuer issued to FAMC
16,027,286 shares of its Class B common stock, par value $.001 per share (the
"FADV B Shares"). The FADV B Shares are convertible on a one for one basis
into an equal amount of shares of the FADV A Shares, at any time at the sole
discretion of FAMC, as well as upon the occurrence of certain events specified
in the Issuer's first amended and restated certificate of incorporation. As a
holder of the Issuer's FADV B Shares, FAMC is entitled to ten votes for each
share held of record on all matters submitted to a vote of holders of the
Issuer's common stock.
The description of the Merger Agreement contained in this Item 4
does not purport to be complete and is qualified in its entirety by reference
to the Merger Agreement included as Exhibit 1 hereto and is incorporated
herein by reference.
Stockholders Agreement
Concurrently with the execution and delivery of the Merger
Agreement, the Reporting Person entered into a Stockholders Agreement (the
"Stockholders Agreement") among the Reporting Person, FAMC and the Issuer.
Tag-Along Right. In the Stockholders Agreement, FAMC agreed that
it will not, directly or indirectly, transfer any shares of the Issuer's
capital stock to any party in a transaction or series of related transactions
occurring within a three-year period commencing at the close of the Merger if,
immediately after such transfer, FAMC and its affiliates would not
beneficially own at least 70% of the number of shares of the Issuer's capital
stock issued to FAMC and its affiliates at the closing of the Merger unless:
o FAMC delivers a written notice to the Reporting Person of such
sale, identifying the third party, the number of shares proposed to be
transferred, the purchase consideration for the shares, the proposed date of
the closing of such sale and the other material terms and conditions of the
proposed sale; and
o at the Reporting Person's election, FAMC permits the Reporting
Person and its affiliates to participate in such sale by selling a number of
shares held by the Reporting Person equal to the product of (a) a fraction,
the numerator of which is the number of shares proposed to be sold by FAMC and
or its affiliates and the denominator of which is the total number of shares
then held by FAMC and its affiliates and (b) the total number of shares then
held by the Reporting Person and its affiliates.
The purchase consideration paid for exercising the tag-along right
will be the purchase consideration offered to FAMC or its affiliates. If FAMC
or any of its affiliates has sold any shares of the Issuer to the other party
in the 12 months before delivering the notice to the Reporting Person or such
sale is part of a series of related transactions, the Reporting Person may
request to treat all such sales to which the Reporting Person has not been
granted a tag-along right as a single transaction, and the price per share to
be paid will be the weighted average price paid for all such transactions.
Designation of Director. FAMC agreed to vote, and cause each of
its affiliates to vote, all of its shares of the Issuer, or otherwise take
such action, as is necessary to ensure that the size of the board of directors
of the Issuer will be no more than 10 directors. In addition, FAMC and each of
its affiliates will cause the election to the board of directors of the Issuer
of one representative designated in writing by the Reporting Person who
initially is Lawrence D. Lenihan, Jr. However, FAMC and its affiliates are not
required to vote their shares in favor of any such representative if:
o such representative is an officer, director or employee of a
person, that is, directly or through its subsidiaries, materially engaged in
an individual background screening business that competes with the individual
background screening business owned by the Issuer and its subsidiaries; or
o such representative is or has been the subject of any of the
matters described in Rule 262(b) promulgated under the Securities Act.
In lieu of designating a member of the board of directors, the
Reporting Person may, subject to execution of a mutually agreed
confidentiality agreement, designate a representative to:
o attend all regular and special meetings of the Issuer's board of
directors in a non-voting, observer capacity; and
o receive all notices and materials provided to members of the
board of directors, other than privileged information or information that the
board reasonably determines to conflict with such representative's rights.
Registration Rights. The securities that may be registered under
the Stockholders Agreement are:
o any FADV A Shares of the Issuer that the Reporting Person or any
of its affiliates own at the date of closing of the Merger or received or is
receivable upon the exercise of warrants held at such closing;
o any securities received or receivable as a dividend, stock split
or other distribution with respect to other registrable securities;
o any securities received or receivable upon specific
reorganization, reclassification, merger, consolidation or other similar
events; and
o any FADV A Shares of the Issuer acquired by the Reporting Person
or its affiliates after the date of Stockholders Agreement, the transfer of
which is restricted under Rule 144 of the Securities Act.
Demand Registration Rights. The Reporting Person has the right, by
written notice delivered to the Issuer, to require the Issuer to register
under the Securities Act the resale registrable securities (as described
above) having an aggregate offering price (before deducting of underwriting
discounts and commissions) to the public in excess of $5.0 million. Upon
receipt of a notice by the Reporting Person, the Issuer will effect, as
expeditiously as reasonably possible, the registration under the Securities
Act of all registrable securities that the Reporting Person requests to be
registered.
If the Reporting Person exercises its demand registration rights
and intends to distribute the registrable securities covered by its request by
means of an underwriting, the Issuer will enter into an underwriting agreement
in customary form with an underwriter or underwriters selected for such
underwriting by the Reporting Person (which underwriter or underwriters will
be reasonably acceptable to the Issuer).
The Issuer will not be required to effect any registration based
on the Reporting Person's demand registration rights:
o before December 13, 2003;
o after the Issuer has effected two registration statements
pursuant to the Reporting Person's demand registration rights and such
registration statements have become effective;
o if the Issuer furnishes to the Reporting Person a certificate
signed by the President or Chief Executive Officer of the Issuer stating that
in the good faith judgment of the Issuer's board of directors, it would be
seriously detrimental to the Issuer and its stockholders for such registration
statement to be effected at such time. If such event occurs, the Issuer has
the right to defer such filing for a period of not more than ninety days after
receipt of the Reporting Person's request; provided that such right to delay a
request is exercised by the Issuer not more than once in any twelve (12) month
period; or
o if the Reporting Person proposes to dispose of FADV A Shares of
registrable securities that may be registered on a Form S-3.
Piggyback Registration. If the Issuer proposes to file any
registration statement under the Securities Act for purposes of a public
offering of securities of the Issuer, whether or not for sale for its own
account, it will afford the Reporting Person and its affiliates an opportunity
to include in such registration statement all or part of the registrable
securities. If such registration statement is for an underwritten offering,
the Reporting Person will enter into an underwriting agreement in customary
form with the underwriter or underwriters selected for such underwriting by
the Issuer but in no event will any indemnity and/or contribution provisions
in such underwriting agreement provide that the indemnity and/or contribution
of the Reporting Person exceed the net proceeds from the offering received by
the Reporting Person.
S-3 Registrations. The Issuer will use its reasonable best efforts
to become and remain eligible to register offerings of securities on Form S-3
or its successor form. At all times during which the Issuer is qualified for
the use of Form S-3, the Reporting Person may request that the Issuer register
its registrable securities on Form S-3. However, the Issuer will not be
required to effect more than two such registrations during any twelve-month
period if such registrations on Form S-3 have been declared or ordered
effective and have remained effective until the earlier of 30 days after the
date of effectiveness or the date all of the registrable securities registered
thereunder have been sold. The Issuer will not be required to effect any S-3
registration:
o within 120 days of the effective date of any other registration
pursuant to the Stockholders Agreement; or
o unless the Reporting Person proposes to dispose registrable
securities having an anticipated aggregate price to the public (net of
underwriting discounts and expenses of sale, if any) of at least $2.0 million.
Once in any 12 month period, the Issuer may defer filing such S-3
registration statement for a period of not more than 90 days following the
requested filing date if the Issuer furnishes to the Reporting Person a
certificate signed by the President or Chief Executive Officer of the Issuer
stating that in the good faith judgment of the Issuer's board of directors it
would be seriously detrimental to the Issuer and its stockholders for a
registration statement to be filed at the time requested. Subject to the
foregoing, the Issuer will use its reasonable best efforts to promptly effect
such registration on Form S-3 to the extent requested by the Reporting Person
under the Stockholders Agreement.
Expenses Related to Registrations. The Issuer will pay all
expenses related to any registration under the Stockholders Agreement, other
than underwriting fees, discounts, commissions or transfer taxes related to
the Reporting Person's shares of FADV A Shares sold under such registration
and will pay fees of one special counsel to the Reporting Person or its
affiliates of up to $25,000. The Issuer and the Reporting Person have agreed
to indemnify each other for third party claims arising out of securities law
violations under customary circumstances.
Termination. No party has any obligations under the Stockholders
Agreement before the Effective Time. After the Effective Time, the provisions
of the Stockholders Agreement terminate as follows:
o The tag-along rights terminate on the earlier of:
o the first date on which the Reporting Person and its
affiliates beneficially own less than 5% of the total number
of shares of the Issuer's common stock issued and
outstanding immediately following the closing of the Merger;
and
o the third anniversary of the Effective Time..
o The registration rights will terminate on the earlier of:
o the fourth anniversary of the effective date; and
o the first date following the effective date on which:
o the Issuer is then providing current public
information within the meaning of Rule 144(c)(1) promulgated
under the Securities Act;
o no representative designated by the Reporting Person
pursuant to the Stockholders Agreement is a member of the
board of the Issuer; and
o The Reporting Person and its affiliates are able to
sell all of their registrable securities without restriction
under Rules 144 and 145 promulgated under the Securities Act
during a three-month period.
o The director designation right will terminate on the first date
on which the Reporting Person owns less than 75% of all of the FADV A Shares
issued to the Reporting Person and its affiliates at the closing of the
Merger.
The description of the Stockholders Agreement above does not
purport to be complete and is qualified in its entirety by reference to the
Stockholders Agreement included as Exhibit 2 hereto and is incorporated herein
by reference.
Item 5. Interest in Securities of the Issuer
(a) The Reporting Person beneficially owns 2,203,267 FADV A Shares
(including shares underlying options exercisable within 60 days of the date
hereof), representing 11% of FADV A Shares outstanding as of June 12, 2003
(including FADV B Shares, which are convertible on a one-for-one basis into an
equal amount of FADV A Shares at any time in the absolute discretion of FAMC
and on a mandatory basis upon the occurrence of certain events specified in
the Issuer's first amended and restated certificate of incorporation.
In addition, by virtue of the Stockholders Agreement, it could be
alleged that a "group," within the meaning of Section 13(d)(3) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), or Rule
13d-5(b)(1) thereunder, has been formed that includes FAMC and the Reporting
Person. While the Reporting Person does not concede that such a "group" has
been formed, this filing is being made to ensure compliance with the Exchange
Act. Such group would be deemed to beneficially own, in the aggregate,
18,230,553 FADV A Shares (assuming the conversion of FADV B Shares into FADV A
Shares and including shares underlying options exercisable within 60 days of
the date hereof), representing 91.1% of the FADV A Shares outstanding as of
June 12, 2003. The Reporting Person expressly disclaims beneficial ownership
of FADV B Shares beneficially owned by FAMC and does not affirm that such a
"group" exists.
(b) The information set forth, or incorporated by reference, in
Items 3 and 4 is incorporated herein by reference.
Pursuant to, and to the extent set forth in, the Stockholders
Agreement, it could be alleged that the Reporting Person shares voting and
dispositive power with respect to the FADV B Shares with FAMC. To the
knowledge of the Reporting Person and based on documents publicly filed by
FAMC, (i) FAMC is a California corporation with its principal office and
principal place of business located at 1 First American Way, Santa Ana,
California 92707-5913, (ii) FAMC is a provider of business information and
related products and services, (iii) the name, address and principal
occupation of each of the officers and directors of FAMC are set forth on
Exhibit 7 hereto and is incorporated herein by reference and (iv) each of such
executive officers and directors is a citizen of the United States with the
exception of Hon. William G. Davis, a Canadian citizen. To the knowledge of
the Reporting Person and based on documents publicly filed by FAMC, during the
last five years, neither FAMC nor its directors and officers of FAMC have
been: (i) convicted in a criminal proceeding (excluding traffic violations or
similar misdemeanors), or (ii) a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such
proceeding was or is subject to a judgment, decree or final order enjoining
future violations of, or prohibiting or mandating activities subject to
Federal or State securities laws or finding any violation with respect to such
laws.
(c ) Except for the information set forth, or incorporated by
reference, in Item 3, which is incorporated herein by reference, none of the
Reporting Persons has effected any transaction relating to the FADV A & B
Shares during the past 60 days.
(d) Not applicable.
(e) Not applicable.
Item 6. Contracts, Agreements, Understandings or Relationships with Respect
to Securities of the Issuer
Reference is made to the Merger Agreement described in Items 3 and
4, included as Exhibit 1 hereto and is incorporated by reference herein.
Reference is also made to the Stockholders Agreement described in Item 4,
included as Exhibit 2 hereto and is incorporated by reference herein.
First Advantage Corporation 2003 Incentive Compensation Plan
The Issuer has adopted the 2003 First Advantage Incentive
Compensation Plan (the "Plan"), which allows the granting of stock options,
stock appreciation rights, restricted stock awards, performance unit awards,
performance share awards and cash-based awards to eligible persons. Subject to
adjustment for certain changes in the Issuer's capitalization, a total of 3.0
million shares of the Issuer's FADV A Shares are available for issuance under
the Plan. Non-employee directors of the Issuer, including Lawrence D. Lenihan,
Jr., who is also an employee of the Reporting Person, receive automatic grants
of options to purchase 5,000 FADV A Shares upon initial election, which vest
in equal parts on each of the first three anniversaries of the date of grant,
and options to purchase 2,500 FADV A Shares upon re-election to the Issuer's
board. Upon the occurrence of a change of control transaction (as defined in
the Plan), generally all awards under the Plan accelerate, all restrictions
are lifted and all performance goals are achieved, subject to certain
limitations. The committee may provide that any award, the payment of which
was deferred under the Plan, will be paid or distributed as of, or promptly
following, a change of control transaction. The committee may also provide
that any awards subject to any such acceleration, payment, adjustment or
conversion cannot be exercised after, or will terminate as of, a change of
control transaction.
On June 5, 2003, at the Effective Time, Lawrence D. Lenihan, Jr.
was granted a seat on the Board of Directors of the Issuer and received
options to purchase 5,000 FADV A Shares (the "Initial Grant") subject to the
terms described above.
The description of the Plan above does not purport to be complete
and is qualified in its entirety by reference to the Plan itself, included as
Exhibit 3 hereto and is incorporated herein by reference.
Converted Options
The following are descriptions of USS options beneficially owned
by the Reporting Person that were assumed by the Issuer:
(i) On September 7, 2000, USS granted the Reporting Person an
option to purchase USS shares (the "9/00 Option"), which provided for the
vesting of 33 1/3% of the options at the one, two, and three year anniversary
of the date of the grant, beginning September 7, 2001. The 9/00 Option was
assumed by the Issuer in the Merger and is now an option to purchase 2,829
FADV A Shares with an exercise price of $46.25 per share. As of the date of
this filing, 1,886 FADV A Shares will have vested (including shares underlying
options exercisable within 60 days of the date hereof).
(ii) On July 25, 2001, USS granted the Reporting Person an option
to purchase USS shares (the "7/01 Option"), which provided for the vesting of
33 1/3% of the options at the one, two, and three year anniversary of the date
of the grant and which was revised to fully vest, based on a vesting schedule
vesting one-twelfth each month over an annual period. The 7/01 Option was
assumed by the Issuer in the Merger and is now an option to purchase 2,000
FADV A Shares with an exercise price of $50.25 per share. As of the date of
this filing, the 7/01 Option has fully vested.
(iii) On July 17, 2002, USS granted the Reporting Person an option
to purchase USS shares (the "7/02 Option"), which provided for the vesting of
one-twelfth of the option at the end of each month subsequent to the grant
date beginning July 31, 2002. The 7/02 Option was assumed by the Issuer in the
Merger and is now an option to purchase 1,000 FADV A Shares with an exercise
price of $14.50 per share. As of the date of this filing, 1,000 FADV A Shares
will have vested (including shares underlying options exercisable within 60
days of the date hereof).
Other than as described above, the 9/00 Option, the 7/01 Option
and the 7/02 Option have substantially similar terms, a form of which is
included in this filing (the "Form of Option Agreement"). The descriptions of
each of the 9/00 Option, the 7/01 Option and the 7/02 Option contained in this
Item 6 do not purport to be complete and are qualified in their entirety by
reference to the Form of Option Agreement, which is included in this Schedule
13D as Exhibit 4 and is incorporated herein by reference.
Converted Warrants
The following are descriptions of USS warrants beneficially owned
by the Reporting Person that were assumed by the Issuer:
(i) On June 5, 2001, USS issued a warrant to the Reporting Person
to acquire USS shares (the "6/01 Warrant"). The 6/01 Warrant was assumed by
the Issuer in the Merger and is now a warrant to purchase 41,462 FADV A
Shares, immediately exercisable, with an exercise price of $12.05925 per
share.
(ii) On December 20, 2001, USS issued a warrant to the Reporting
Person to acquire USS shares (the "12/01 Warrant"). The 12/01 Warrant was
assumed by the Issuer in the Merger and is now a warrant to purchase 44,700
FADV A Shares, immediately exercisable, with an exercise price of $26.10 per
share. The 12/01 Warrant expires on December 20, 2005.
(iii) On July 18, 2002, USS issued a warrant to the Reporting
Person to acquire USS shares (the "7/02 Warrant"). The 7/02 Warrant was
assumed by the Issuer in the Merger and is now a warrant to purchase 8,940
FADV A Shares, immediately exercisable, with an exercise price of $26.10 per
share. The 7/02 Warrant expires on July 18, 2006.
(iv) On August 5, 2002, USS issued a warrant to the Reporting
Person to acquire USS shares (the "8/02 Warrant"). The 8/02 Warrant was
assumed by the Issuer in the Merger and is now a warrant to purchase 2,091
FADV A Shares, immediately exercisable, with an exercise price of $26.10 per
share. The 8/02 Warrant expires on December 20, 2005.
The 12/01 Warrant, the 7/02 Warrant and the 8/02 Warrant have
substantially similar terms, a form of which is included in this filing (the
"Form of Warrant"). The descriptions of each of the 6/01 Warrant, the 12/01
Warrant, the 7/02 Warrant and the 8/02 Warrant contained in this Item 6 do not
purport to be complete and are qualified in their entirety by reference to
each of the 6/01 Warrant and the Form of Warrant, which are included in this
Schedule 13D as Exhibits 5 and 6, respectively, and are incorporated herein by
reference.
Item 7. Material to be Filed as Exhibits
Exhibit 1 Agreement and Plan of Merger, dated as of December 13, 2002,
by and among FAMC, USS, the Issuer and Merger Sub.
(incorporated by reference to Exhibit 2.1 of Pre-Effective
Amendment No. 5 to the Issuer's Registration Statement on
Form S-4, filed May 14, 2003)
Exhibit 2 Stockholders Agreement, dated as of December 13, 2002, by
and among FAMC, Pequot Private Equity Fund II, L.P. and the
Issuer (incorporated by reference to Exhibit 10.1 of
Pre-Effective Amendment No. 5 to the Issuer's Registration
Statement on Form S-4, filed May 14, 2003)
Exhibit 3 First Advantage Corporation 2003 Incentive Compensation Plan
(incorporated by reference to Exhibit 4.19 of Pre-Effective
Amendment No. 1 to the Issuer's Registration Statement of
Form S-4, filed April 4, 2003).
Exhibit 4 Form of US Search.com Inc. Nonstatutory Stock Option (1999
Non-Employee Directors' Stock Option Plan, issued by USS in
favor of Pequot Private Equity Fund II, L.P.
Exhibit 5 Warrant, dated June 5, 2001, issued by USS in favor of
Pequot Private Equity Fund II, L.P. (incorporated by
reference to Exhibit 10.3 of Form 8-K filed by USS on June
7, 2001)
Exhibit 6 Form of Warrant, issued by USS in favor of Pequot Private
Equity Fund II, L.P.
Exhibit 7 Executive officers and directors of FAMC
S I G N A T U R E
After reasonable inquiry and to the best of my knowledge and belief,
I certify that the information set forth in this statement is true, complete,
and correct.
Date: June 16, 2003 Pequot Capital Management, Inc.
/s/ Harold Kahn
--------------------------------
Harold Kahn, Chief Operating Officer
INDEX TO EXHIBITS
Exhibit Description
Exhibit 1 Agreement and Plan of Merger, dated as of December 13, 2002,
by and among FAMC, USS, the Issuer and Merger Sub.
(incorporated by reference to Exhibit 2.1 of Pre-Effective
Amendment No. 5 to the Issuer's Registration Statement on
Form S-4, filed May 14, 2003)
Exhibit 2 Stockholders Agreement, dated as of December 13, 2002, by
and among FAMC, Pequot Private Equity Fund II, L.P. and the
Issuer (incorporated by reference to Exhibit 10.1 of
Pre-Effective Amendment No. 5 to the Issuer's Registration
Statement on Form S-4, filed May 14, 2003)
Exhibit 3 First Advantage Corporation 2003 Incentive Compensation Plan
(incorporated by reference to Exhibit 4.19 of Pre-Effective
Amendment No. 1 to the Issuer's Registration Statement of
Form S-4, filed April 4, 2003).
Exhibit 4 Form of US Search.com Inc. Nonstatutory Stock Option (1999
Non-Employee Directors' Stock Option Plan, issued by USS in
favor of Pequot Private Equity Fund II, L.P.
Exhibit 5 Warrant, dated June 5, 2001, issued by USS in favor of
Pequot Private Equity Fund II, L.P. (incorporated by
reference to Exhibit 10.3 of Form 8-K filed by USS on June
7, 2001)
Exhibit 6 Form of Warrant, issued by USS in favor of Pequot Private
Equity Fund II, L.P.
Exhibit 7 Executive officers and directors of FAMC
EXHIBIT 4
FORM OF
U.S. SEARCH.COM INC.
NONSTATUTORY STOCK OPTION
(1999 NON-EMPLOYEE DIRECTORS' STOCK OPTION PLAN)
Pequot Private Equity Fund II, LP, Optionholder:
U.S. SEARCH.com Inc. (the "Company"), pursuant to its 1999
Non-Employee Directors' Stock Option Plan (the "Plan") has on __________ (the
"Grant Date") granted to you, the Optionholder named above, an option to
purchase shares of the common stock of the Company ("Common Stock"). This
option is not intended to qualify and will not be treated as an "incentive
stock option" within the meaning of Section 422 of the Internal Revenue Code
of 1986, as amended (the "Code").
The grant hereunder is in connection with and in furtherance of the
Company's compensatory benefit plan for participation of the Company's
Non-Employee Directors (as defined in the Plan).
The details of your option are as follows:
1. The total number of shares of Common Stock subject to this option is
______________. Subject to the limitations contained herein, this
option shall be exercisable in accordance with the Plan.
2. The exercise price of this option is _____________ ($____) per share,
being the Fair Market Value (as defined in the Plan) of the Common
Stock on the date of grant of this option.
3. This option shall vest over _______ year(s) such that _________ of
the shares shall vest _____________ after the Grant Date. This option
may be exercised with respect to vested shares only by delivering a
notice of exercise (in a form designated by the Company) together
with the exercise price to the Secretary of the Company, or to such
other person as the Company may designate, during regular business
hours, together with such additional documents as the Company may
then require pursuant to Section 10 of the Plan. This option may not
be exercised for any number of shares, which would require the
issuance of anything other than whole shares.
By exercising this option you agree that the Company may require you
to enter an arrangement providing for the cash payment by you to the Company
of any tax withholding obligation of the Company arising by reason of the
exercise of this option or the lapse of any substantial risk of forfeiture to
which the shares are subject at the time of exercise.
4. Any notices provided for in this option or the Plan shall be given in
writing and shall be deemed effectively given upon receipt or, in the
case of the notices delivered by the Company to you, five (5) days
after deposit in the United States mail, postage prepaid, addressed
to you at the address specified below or at such other address as you
hereafter designate by written notice to the Company.
5. This option is subject to all the provisions of the Plan, a copy of
which is attached hereto and its provisions are hereby made a part of
this option, including without limitation the provisions of Section 7
of the Plan relating to option provisions, and is further subject to
all interpretations, amendments, rules and regulations which may from
time to time be promulgated and adopted pursuant to the Plan. In the
event of any conflict between the provisions of this option and those
of the Plan, the provisions of the Plan shall control.
Dated the _____ day of ________, ____
Very truly yours,
U.S. SEARCH.com Inc.
By:
------------------------------
Duly authorized on behalf of the
Board of Directors
ATTACHMENTS:
1999 Non-Employee Directors' Stock Option Plan
Notice of Exercise
The undersigned:
(a) Acknowledges receipt of the foregoing option and the
attachments referenced therein and understands that all
rights and liabilities with respect to this option are set
forth in the option and the Plan.
(b) Further acknowledges that either:
(i) he or she has preexisting personal or business
relationships with the Company or any of its officers, directors or
controlling persons, consisting of personal or business contacts of a
nature and duration such as would enable a reasonably prudent
purchaser to be aware of the character, business acumen and general
business and financial circumstances of the person with whom such
relationship exists, or
(ii) by reason of his or her business or financial
experience or the business and financial experience of his or her
professional advisors who are unaffiliated with and who are not
compensated by the Company or any affiliate or selling agent of the
Company, either directly or indirectly, he or she could be reasonably
assumed to have the capacity to protect his or her own interests
within the meaning of California Corporations Code Section 25102(f).
(c) Further acknowledges that as of the date of grant of this
option, it sets forth the entire understanding between the
undersigned Optionholder and the Company and its affiliates
regarding the acquisition of stock in the Company and
supersedes all prior oral and written agreements on that
subject with the exception of (i) the options previously
granted and delivered to the undersigned under stock options
plans of the Company, and (ii) the following agreements
only:
NONE__________
(Initial)
OTHER ____________________________________
____________________________________
Pequot Private Equity Fund II, LP,
By Pequot Capital Management, Inc.,
its investment advisor
____________________________________
By:
Address: 500 Nyala Farm Rd.
Westport, CT 06880
NOTICE OF EXERCISE
U.S. Search.com Inc.
5401 Beethoven Street
Los Angeles, CA 90066
Date of Exercise: _________________
Ladies and Gentlemen:
This constitutes notice under my stock option that I elect to
purchase the number of shares for the price set forth below.
Type of option (check one): Nonstatutory
Stock option dated: __________
Number of shares as to
which option is exercised: __________
Certificates to be issued
in name of: __________
Total exercise price: __________
Cash payment delivered herewith: __________
Value of __________ shares of
U.S. Search.com Inc. common
stock delivered herewith(1): __________
By this exercise, I agree (i) to provide such additional documents as
you may require pursuant to the terms of the ________________________ and (ii)
to provide for the payment by me to you (in the manner designated by you) of
your withholding obligation, if any, relating to the exercise of this option.
I hereby make the following certifications and representations with
respect to the number of shares of Common Stock of the Company listed above
(the "Shares"), which are being acquired by me for my own account upon
exercise of the Option as set forth above:
- -----------
(1) Shares must meet the public trading requirements set forth in the
option. Shares must be valued in accordance with the terms of the option being
exercised, must have been owned for the minimum period required in the option,
and must be owned free and clear of any liens, claims, encumbrances or
security interests. Certificates must be endorsed or accompanied by an
executed assignment separate from certificate.
I acknowledge that the Shares have not been registered under the
Securities Act of 1933, as amended (the "Securities Act"), and are deemed to
constitute "restricted securities" under Rule 701 and "control securities"
under Rule 144 promulgated under the Securities Act. I warrant and represent
to the Company that I have no present intention of distributing or selling
said Shares, except as permitted under the Securities Act and any applicable
state securities laws.
I further acknowledge that all certificates representing any of the
Shares subject to the provisions of the Option shall have endorsed thereon
appropriate legends reflecting the foregoing limitations, as well as any
legends reflecting restrictions pursuant to the Company's Articles of
Incorporation, Bylaws and/or applicable securities laws.
Very truly yours,
______________________________
800-U.S. SEARCH
1999 NON-EMPLOYEE DIRECTORS' STOCK OPTION PLAN
Adopted by the Board of Directors February 26, 1999
Approved By Shareholders , 1999
Effective Date: February 26, 1999
1. PURPOSES.
(a) Eligible Option Recipients. The persons eligible to receive
Options are the Non-Employee Directors of the Company.
(b) Available Options. The purpose of the Plan is to provide a means
by which Non-Employee Directors may be given an opportunity to benefit from
increases in value of the Common Stock through the granting of Nonstatutory
Stock Options.
(c) General Purpose. The Company, by means of the Plan, seeks to
retain the services of its Non-Employee Directors, to secure and retain the
services of new Non-Employees Directors and to provide incentives for such
persons to exert maximum efforts for the success of the Company and its
Affiliates.
2. DEFINITIONS.
(a) "Affiliate" means any parent corporation or subsidiary
corporation of the Company, whether now or hereafter existing, as those terms
are defined in Sections 424(e) and (f), respectively, of the Code.
(b) "Annual Grant" means an Option granted annually to all
Non-Employee Directors who meet the specified criteria pursuant to subsection
6(b) of the Plan.
(c) "Annual Meeting" means the annual meeting of the shareholders of
the Company.
(d) "Board" means the Board of Directors of the Company.
(e) "Code" means the Internal Revenue Code of 1986, as amended.
(f) "Common Stock" means the common stock of the Company.
(g) "Company" means 800-U.S. Search., a California corporation.
(h) "Consultant" means any person, including an advisor, (i) engaged
by the Company or an Affiliate, to render consulting or advisory services and
who is compensated for such services or (ii) who is a member of the Board of
Directors of an Affiliate. However, the term "Consultant" shall not include
either Directors of the Company who are not compensated by the Company for
their services as Directors or Directors of the Company who are merely paid a
director's fee by the Company for their services as Directors.
(i) "Continuous Service" means that the Optionholder's service with
the Company or an Affiliate, whether as an Employee, Director or Consultant,
is not interrupted or terminated. The Optionholder's Continuous Service shall
not be deemed to have terminated merely because of a change in the capacity in
which the Optionholder renders service to the Company or an Affiliate as an
Employee, Consultant or Director or a change in the entity for which the
Optionholder renders such service, provided that there is no interruption or
termination of the Optionholder's Continuous Service. For example, a change in
status from a Non-Employee Director of the Company to a Consultant of an
Affiliate or an Employee of the Company will not constitute an interruption of
Continuous Service. The Board or the chief executive officer of the Company,
in that party's sole discretion, may determine whether Continuous Service
shall be considered interrupted in the case of any leave of absence approved
by that party, including sick leave, military leave or any other personal
leave.
(j) "Director" means a member of the Board of Directors of the
Company.
(k) "Employee" means any person employed by the Company or an
Affiliate. Mere service as a Director or payment of a director's fee by the
Company or an Affiliate shall not be sufficient to constitute "employment" by
the Company or an Affiliate.
(l) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
(m) "Fair Market Value" means, as of any date, the value of the
Common Stock determined as follows:
(i) If the Common Stock is listed on any established stock
exchange or traded on the Nasdaq National Market or the Nasdaq SmallCap
Market, the Fair Market Value of a share of Common Stock shall be the closing
sales price for such stock (or the closing bid, if no sales were reported) as
quoted on such exchange or market (or the exchange or market with the greatest
volume of trading in the Common Stock) on the last market trading day prior to
the day of determination, as reported in The Wall Street Journal or such other
source as the Board deems reliable.
(ii) In the absence of such markets for the Common Stock, the
Fair Market Value shall be determined in good faith by the Board.
(n) "Initial Grant" means an Option granted to a Non-Employee
Director who meets the specified criteria pursuant to subsection 6(a) of the
Plan.
(o) "Non-Employee Director" means a Director who is not employed by
the Company or an Affiliate.
(p) "Nonstatutory Stock Option" means an Option not intended to
qualify as an incentive stock option within the meaning of Section 422 of the
Code and the regulations promulgated thereunder.
(q) "Officer" means a person who is an officer of the Company within
the meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.
(r) "Option" means a Nonstatutory Stock Option granted pursuant to
the Plan.
(s) "Option Agreement" means a written agreement between the Company
and an Optionholder evidencing the terms and conditions of an individual
Option grant. Each Option Agreement shall be subject to the terms and
conditions of the Plan.
(t) "Optionholder" means a person to whom an Option is granted
pursuant to the Plan or, if applicable, such other person who holds an
outstanding Option.
(u) "Plan" means this 800-U.S. Search 1999 Non-Employee Directors'
Stock Option Plan.
(v) "Rule 16b-3" means Rule l6b-3 promulgated under the Exchange Act
or any successor to Rule 16b-3, as in effect from time to time.
(w) "Securities Act" means the Securities Act of 1933, as amended.
3. ADMINISTRATION.
(a) Administration by Board. The Board shall administer the Plan. The
Board may not delegate administration of the Plan to a committee.
(b) Powers of Board. The Board shall have the power, subject to, and
within the limitations of, the express provisions of the Plan:
(i) To determine the provisions of each Option to the extent not
specified in the Plan.
(ii) To construe and interpret the Plan and Options granted under
it, and to establish, amend and revoke rules and regulations for its
administration. The Board, in the exercise of this power, may correct any
defect, omission or inconsistency in the Plan or in any Option Agreement, in a
manner and to the extent it shall deem necessary or expedient to make the Plan
fully effective.
(iii) To amend the Plan or an Option as provided in Section 12.
(iv) Generally, to exercise such powers and to perform such acts
as the Board deems necessary or expedient to promote the best interests of the
Company which are not in conflict with the provisions of the Plan.
4. SHARES SUBJECT TO THE PLAN.
(a) Share Reserve. Subject to the previsions of Section 11 relating
to adjustments upon changes in stock, the stock that may be issued pursuant to
Options shall not exceed in the aggregate two hundred and fifty (250) shares
of Common Stock.
(b) Reversion of Shares to the Share Reserve. If any Option shall for
any reason expire or otherwise terminate, in whole or in part, without having
been exercised in full, the stock not acquired under such Option shall revert
to and again become available for issuance under the Plan.
(c) Source of Shares. The stock subject to the Plan may be unissued
shares or reacquired shares, bought on the market or otherwise.
5. ELIGIBILITY.
Nondiscretionary Options as set forth in section 6 shall be granted
under the Plan to all Non-Employee Directors.
6. NON-DISCRETIONARY GRANTS.
(a) Initial Grants. Without any further action of the Board, each
Non-Employee Director shall be granted the following Options:
(i) On February 26, 1999, each person who is then a Non-Employee
Director automatically shall be granted an Initial Grant to purchase thirty
(30) shares of Common Stock on the terms and conditions set forth herein.
(ii) After February 26, 1999, each person who is elected or
appointed for the first time to be a Non-Employee Director automatically
shall, upon the date of his or her initial election or appointment to be a
Non-Employee Director by the Board or shareholders of the Company, be granted
an Initial Grant to purchase thirty (30) shares of Common Stock on the terms
and conditions set forth herein.
(b) Annual Grants. On day prior to each Annual Meeting commencing
with the Annual Meeting in 2000, each person who is then a Non-Employee
Director automatically shall be granted an Annual Grant to purchase five (5)
shares of Common Stock on the terms and conditions set forth herein; provided,
however, that if the person has not been serving as a Non-Employee Director
for the entire period since the preceding an Annual Meeting, then the number
of shares subject to such Annual Grant shall be reduced pro rata for each full
quarter prior to the date of grant during which such person did not serve as a
Non-Employee Director.
7. OPTION PROVISIONS.
Each Option shall be in such form and shall contain such terms and
conditions as required by the Plan. Each Option shall contain such additional
terms and conditions, not inconsistent with the Plan, as the Board shall deem
appropriate. Each Option shall include (through incorporation of provisions
hereof by reference in the Option or otherwise) the substance of each of the
following provisions:
(a) Term. No Option shall be exercisable after the expiration of ten
(10) years from the date it was granted.
(b) Exercise Price. The exercise price of each Option shall be one
hundred percent (100%) of the Fair Market Value of the stock subject to the
Option on the date the Option is granted. Notwithstanding the foregoing, an
Option may be granted with an exercise price lower than that set forth in the
preceding sentence if such Option is granted pursuant to an assumption or
substitution for another option in a manner satisfying the provisions of
Section 424(a) of the Code.
(c) Consideration. The purchase price of stock acquired pursuant to
an Option may be paid, to the extent permitted by applicable statutes and
regulations, in any combination of (i) cash or check, (ii) delivery to the
Company of other Common Stock, (iii) deferred payment or (iv) any other form
of legal consideration that may be acceptable to the Board and provided in the
Option Agreement; provided, however, that at any time that the Company is
incorporated in Delaware, payment of the Common Stock's "par value," as
defined in the Delaware General Corporation Law, shall not be made by deferred
payment.
In the case of any deferred payment arrangement, interest shall be
compounded at least annually and shall be charged at the minimum rate of
interest necessary to avoid the treatment as interest, under any applicable
provisions of the Code, of any amounts other than amounts stated to be
interest under the deferred payment arrangement.
(d) Transferability. An Option shall not be transferable except by
will or by the laws of descent and distribution and shall be exercisable
during the lifetime of the Optionholder only by the Optionholder.
Notwithstanding the foregoing, the Optionholder may, by delivering written
notice to the Company, in a form satisfactory to the Company, designate a
third party who, in the event of the death of the Optionholder, shall
thereafter be entitled to exercise the Option.
(e) Vesting Generally. Options shall vest and become exercisable as
follows:
(i) Initial Grants shall provide for vesting of 1/3rd of the
shares on each anniversary of the date of the grant.
(ii) Annual Grants shall provide for vesting of 1/12th of the
shares each month after the date of the grant.
(f) Termination of Continuous Service. In the event an Optionholder's
Continuous Service terminates (other than upon the Optionholder's death), the
Optionholder may exercise his or her Option (to the extent that the
Optionholder was entitled to exercise it as of the date of termination) but
only within such period of time ending on the earlier of (i) the date twelve
(12) months following the termination of the Optionholder's Continuous
Service, or (ii) the expiration of the term of the Option as set forth in the
Option Agreement. If, after termination, the Optionholder does not exercise
his or her Option within the time specified in the Option Agreement, the
Option shall terminate.
(g) Extension of Termination Date. If the exercise of the Option
following the termination of the Optionholder's Continuous Service (other than
upon the Optionholder's death) would be prohibited at any time solely because
the issuance of shares would violate the registration requirements under the
Securities Act, then the Option shall terminate on the earlier of (i) the
expiration of the term of the Option set forth in subsection 7(a) or (ii) the
expiration of a period of three (3) months after the termination of the
Optionholder's Continuous Service during which the exercise of the Option
would not be in violation of such registration requirements.
(h) Death of Optionholder. In the event (i) an Optionholder's
Continuous Service terminates as a result of the Optionholder's death or (ii)
the Optionholder dies within the three-month period after the termination of
the Optionholder's Continuous Service for a reason other than death, then the
Option may be exercised (to the extent the Optionholder was entitled to
exercise the Option as of the date of death) by the Optionholder's estate, by
a person who acquired the right to exercise the Option by bequest or
inheritance or by a person designated to exercise the Option upon the
Optionholder's death, but only within the period ending on the earlier of (1)
the date eighteen (18) months following the date of death or (2) the
expiration of the term of such Option as set forth in the Option Agreement.
If, after death, the Option is not exercised within the time specified herein,
the Option shall terminate.
8. COVENANTS OF TUE COMPANY.
(a) Availability of Shares. During the terms of the Options, the
Company shall keep available at all times the number of shares of Common Stock
required to satisfy such Options.
(b) Securities Law Compliance. The Company shall seek to obtain from
each regulatory commission or agency having jurisdiction over the Plan such
authority as may be required to grant Options and to issue and sell shares of
Common Stock upon exercise of the Options; provided, however, that this
undertaking shall not require the Company to register under the Securities Act
the Plan, any Option or any stock, issued or issuable pursuant to any such
Option. If, after reasonable efforts, the Company is unable to obtain from any
such regulatory commission or agency the authority which counsel for the
Company deems necessary for the lawful issuance and sale of stock under the
Plan, the Company shall be relieved from any liability for failure to issue
and sell stock upon exercise of such Options unless and until such authority
is obtained.
9. USE OF PROCEEDS FROM STOCK.
Proceeds from the sale of stock pursuant to Options shall constitute
general funds of the Company.
10. MISCELLANEOUS.
(a) Shareholder Rights. No Optionholder shall be deemed to be the
holder of, or to have any of the rights of a holder with respect to, any
shares subject to such Option unless and until such Optionholder has satisfied
all requirements for exercise of the Option pursuant to its terms.
(b) No Service Rights. Nothing in the Plan or any instrument executed
or Option granted pursuant thereto shall confer upon any Optionholder any
right to continue to serve the Company as a Non-Employee Director or shall
affect the right of the Company or an Affiliate to terminate (i) the
employment of an Employee with or without notice and with or without cause;
(ii) the service of a Consultant pursuant to the terms of such Consultant's
agreement with the Company or an Affiliate or (iii) the service of a Director
pursuant to the Bylaws of the Company or an Affiliate, and any applicable
provisions of the corporate law of the state in which the Company or the
Affiliate is incorporated, as the case may be.
(c) Investment Assurances. The Company may require an Optionholder,
as a condition of exercising or acquiring stock under any Option, (i) to give
written assurances satisfactory to the Company as to the Optionholder's
knowledge and experience in financial and business matters and/or to employ a
purchaser representative reasonably satisfactory to the Company who is
knowledgeable and experienced in financial and business matters and that he or
she is capable of evaluating, alone or together with the purchaser
representative, the merits and risks of exercising the Option; and (ii) to
give written assurances satisfactory to the Company stating that the
Optionholder is acquiring the stock subject to the Option for the
Optionholder's own account and not with any present intention of selling or
otherwise distributing the stock. The foregoing requirements, and any
assurances given pursuant to such requirements, shall be inoperative if (iii)
the issuance of the shares upon the exercise or acquisition of stock under the
Option has been registered under a then currently effective registration
statement under the Securities Act or (iv) as to any particular requirement, a
determination is made by counsel for the Company that such requirement need
not be met in the circumstances under the then applicable securities laws. The
Company may, upon advice of counsel to the Company, place legends on stock
certificates issued under the Plan as such counsel deems necessary or
appropriate in order to comply with applicable securities laws, including, but
not limited to, legends restricting the transfer of the stock.
(d) Withholding Obligations. The Optionholder may satisfy any
federal, state or local tax withholding obligation relating to the exercise or
acquisition of stock under an Option by any of the following means (in
addition to the Company's right to withhold from any compensation paid to the
Optionholder by the Company) or by a combination of such means: (i) tendering
a. cash payment; (ii) authorizing the Company to withhold shares from the
shares of the Common Stock otherwise issuable to the Optionholder as a result
of the exercise or acquisition of stock under the Option; or (iii) delivering
to the Company owned and unencumbered shares of the Common Stock.
11. ADJUSTMENTS UPON CHANGES IN STOCK.
(a) Capitalization Adjustments. If any change is made in the stock
subject to the Plan, or subject to any Option, without the receipt of
consideration by the Company (through merger, consolidation, reorganization,
recapitalization, reincorporation, stock dividend, dividend in property other
than cash, stock split, liquidating dividend, combination of shares, exchange
of shares, change in corporate structure or other transaction not involving
the receipt of consideration by the Company), the Plan will be appropriately
adjusted in the class(es) and maximum number of securities subject both to the
Plan pursuant to subsection 4(a) and to the nondiscretionary Options specified
in Section 5, and the outstanding Options will be appropriately adjusted in
the class(es) and number of securities and price per share of stock subject to
such outstanding Options. The Board shall make such adjustments, and its
determination shall be final, binding and conclusive. (The conversion of any
convertible securities of the Company shall not be treated as a transaction
"without receipt of consideration" by the Company.)
(b) Change in Control--Dissolution or Liquidation. In the event of a
dissolution or liquidation of the Company, then all outstanding Options shall
terminate immediately prior to such event.
(c) Change in Control--Asset Sale, Merger, Consolidation or Reverse
Merger. In the event of (i) a sale of all or substantially all of the assets
of the Company, (ii) a merger or consolidation in which the Company is not the
surviving corporation or (iii) a reverse merger in which the Company is the
surviving corporation but the shares of Common Stock outstanding immediately
preceding the merger are converted by virtue of the merger into other
property, whether in the form of securities, cash or otherwise, then any
surviving corporation or acquiring corporation shall assume any Options
outstanding under the Plan or shall substitute similar Options (including any
option to acquire the same consideration paid to the shareholders in the
transaction described in this subsection 11(c) for those outstanding under the
Plan. In the event any surviving corporation or acquiring corporation refuses
to assume such Options or to substitute similar Options for those outstanding
under the Plan, then with respect to Options held by Optionholders whose
Continuous Service has not terminated, the vesting of such Options shall be
accelerated in full, and the Options shall terminate if not exercised at or
prior to such event. With respect to any other Options outstanding under the
Plan, such. Options shall terminate if not exercised prior to such event.
12. AMENDMENT OF THE PLAN AND OPTIONS.
(a) Amendment of Plan. The Board at any time, and from time to time,
may amend the Plan. However, except as provided in Section 11 relating to
adjustments upon changes in stock, no amendment shall be effective unless
approved by the shareholders of the Company to the extent shareholder approval
is necessary to satisfy the requirements of Rule 16b-3 or any Nasdaq or
securities exchange listing requirements.
(b) Shareholder Approval. The Board may, in its sole discretion,
submit any other amendment to the Plan for shareholder approval.
(c) No Impairment of Rights. Rights under any Option granted before
amendment of the Plan shall not be impaired by any amendment of the Plan
unless (i) the Company requests the consent of the Optionholder and (ii) the
Optionholder consents in writing.
(d) Amendment of Options. The Board at any time, and from time to
time, may amend the terms of any one or more Options; provided, however, that
the rights under any Option shall not be impaired by any such amendment unless
(i) the Company requests the consent of the Optionholder and (ii) the
Optionholder consents in writing.
13. TERMINATION OR SUSPENSION OF THE PLAN.
(a) Plan Term. The Board may suspend or terminate the Plan at any
time. No Options may be granted under the Plan while the Plan is suspended or
after it is terminated.
(b) No Impairment of Rights. Suspension or termination of the Plan
shall not impair rights and obligations under any Option granted while the
Plan is in effect except with the written consent of the Optionholder.
14. EFFECTIVE DATE OF PLAN.
The Plan shall become effective the date the Plan is adopted by the
Board but no Option shall be exercised unless and until the Plan has been
approved by the shareholders of the Company, which approval shall be within
twelve (12) months before or after the date the Plan is adopted by the Board.
15. CHOICE OF LAW.
All questions concerning the construction, validity and
interpretation of this Plan shall be governed by the law of the State of
California, without regard to such state's conflict of laws rules.
EXHIBIT 6
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, (THE "ACT") OR UNDER ANY STATE SECURITIES
LAWS, AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, ASSIGNED, PLEDGED
OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT OR UNLESS THE
COMPANY HAS RECEIVED AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY AND ITS
COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE (AND ALL TRANSFERS THEREOF) ARE
SUBJECT TO THE RESTRICTIONS ON TRANSFER SET FORTH IN THE REGISTRATION RIGHTS
AGREEMENT, DATED AS OF __________________, A COPY OF WHICH IS ON FILE AT THE
PRINCIPAL OFFICE OF THE COMPANY. NO TRANSFER OF SUCH SHARES WILL BE MADE ON
THE BOOKS OF THE COMPANY UNLESS ACCOMPANIED BY EVIDENCE OF COMPLIANCE WITH THE
TERMS OF SUCH AGREEMENT AND BY AN AGREEMENT OF THE TRANSFEREE TO BE BOUND BY
THE RESTRICTIONS SET FORTH THEREIN. ANY ATTEMPTED TRANSFER OF THESE SHARES IN
VIOLATION OF SUCH REGISTRATION RIGHTS AGREEMENT SHALL BE NULL AND VOID AND
HAVE NO FORCE OR EFFECT.
Warrant No.: ____ Number of Shares: ___________
Date of Issuance: ___________ (subject to adjustment)
US SEARCH.COM INC.
Form of Warrant
US SEARCH.com Inc., a Delaware corporation (the "Company"), for value
received, hereby certifies that Pequot Private Equity Fund II, L.P., or its
registered assigns (the "Registered Holder"), is entitled, subject to the
terms set forth below, to purchase from the Company, at any time after the
Approval Date (as such term is defined in Section 1(a) below) and on or before
the Expiration Date (as defined in Section 5 below), up to _______________
shares of Common Stock, par value $.001 per share, of the Company ("Common
Stock"), at a purchase price equal to $1.044. The shares purchasable upon
exercise of this Warrant and the purchase price per share, as adjusted from
time to time pursuant to the provisions of this Warrant, are hereinafter
referred to as the "Warrant Stock" and the "Purchase Price," respectively.
1. Exercise.
(a) Manner of Exercise. This Warrant may be exercised by the
Registered Holder, in whole or in part, at any time after the earlier of the
date the Borrower receives (x) approval from its stockholders of the financing
transactions contemplated by the Purchase Agreement dated December 20, 2001
among the Company and the Purchasers named therein (the "Purchase Agreement")
or (y) the approval of the Nasdaq National Market to the effect that the
Borrower may complete the transactions contemplated by the Purchase Agreement
without soliciting the approval of holders of its capital stock pursuant to
MarketPlace Rule 4350(i)(1)(D)(ii), (such earlier date is referred to hereto
as the "Approval Date"), and on or before the Expiration Date by surrendering
this Warrant, with the purchase form appended hereto as Exhibit A-1 (the
"Purchase Form") duly executed by such Registered Holder or by such Registered
Holder's duly authorized attorney, at the principal office of the Company, or
at such other office or agency as the Company may designate, accompanied by
payment in full of the aggregate Purchase Price payable in respect of the
number of shares of Warrant Stock specified in such Purchase Form. The
Purchase Price may be paid by cash or certified or official bank check payable
to the Company, wire transfer or by the surrender of promissory notes or other
instruments representing indebtedness of the Company to the Registered Holder.
(b) Effective Time of Exercise. Each exercise of this Warrant shall
be deemed to have been effected immediately prior to the close of business on
the day on which this Warrant, the accompanying Purchase Form and the
aggregate Purchase Price shall have been surrendered to the Company as
provided in Section 1(a) above. At such time, the person or persons in whose
name or names any certificates for Warrant Stock shall be issuable upon such
exercise shall be deemed for the purposes hereof to have become the holder or
holders of record of the Warrant Stock represented by such certificates
issuable upon such exercise, notwithstanding that the stock transfer records
of the Company may be closed or that certificates representing the Warrant
Stock shall not then be actually delivered to the Registered Holder.
(c) Net Issue Exercise.
(i) In lieu of exercising this Warrant in the manner provided
above in Section 1(a), the Registered Holder may elect to receive shares equal
to the value of this Warrant (or the portion thereof being canceled) by
surrender of this Warrant with the notice of exercise form appended hereto as
Exhibit A-2, duly executed by such Registered Holder or by such Registered
Holder's duly authorized attorney, at the principal office of the Company
together with notice of such election in which event the Company shall issue
to such Registered Holder a number of shares of Warrant Stock computed using
the following formula:
X = Y (A - B)
---------
A
Where X = The number of shares of Warrant Stock to be issued to
the Registered Holder.
Y = The number of shares of Warrant Stock
purchasable under this Warrant (at the date of
such calculation).
A = The Fair Market Value of one share of Warrant Stock
(at the date of such calculation).
B = The Purchase Price (as adjusted to the date of such
calculation).
(ii) For purposes of this Section 1(c) and Section 12 hereof, the
"Fair Market Value" of one share of Warrant Stock on the date of calculation
shall be at the highest price per share which the Company could obtain on the
date of calculation from a willing buyer (not a current employee or director)
for shares of Warrant Stock sold by the Company, from authorized but unissued
shares, as determined in good faith by the Board of Directors, unless the
Company is at such time subject to an acquisition as described in Section 6(b)
below, in which case the Fair Market Value of one share of Warrant Stock shall
be deemed to be the value received by the holder of one share of Common Stock
pursuant to such acquisition.
(d) Delivery to Registered Holder. As soon as practicable after the
exercise of this Warrant, in whole or in part, pursuant to Section 1(a) or
1(c) hereof, and in any event within ten days thereafter, the Company at its
expense will cause to be issued in the name of, and delivered to, the
Registered Holder, or as such Registered Holder (upon payment by such
Registered Holder of any applicable transfer taxes) may direct:
(i) a certificate or certificates representing the number of
shares of Warrant Stock to which such Registered Holder shall be entitled and
cash in lieu of fractional shares issuable upon exercise, and
(ii) in case such exercise is in part only, a new warrant or
warrants (dated the date hereof) of like tenor, calling in the aggregate on
the face or faces thereof for the number of shares of Warrant Stock equal
(without giving effect to any adjustment therein) to the number of such shares
called for on the face of this Warrant minus the number of such shares
purchased by the Registered Holder upon such exercise as provided in Section
1(a) or 1(c) above.
2. Adjustments.
(a) Stock Splits and Dividends. If outstanding shares of the
Company's Common Stock shall be subdivided into a greater number of shares or
a dividend or other distribution in Common Stock shall be paid in respect of
Common Stock, the Purchase Price in effect immediately prior to such
subdivision or at the record date of such dividend shall simultaneously with
the effectiveness of such subdivision or immediately after the record date of
such dividend or other distribution be proportionately reduced. If outstanding
shares of Common Stock shall be combined into a smaller number of shares, the
Purchase Price in effect immediately prior to such combination shall,
simultaneously with the effectiveness of such combination, be proportionately
increased. When any adjustment is required to be made in the Purchase Price,
the number of shares of Warrant Stock purchasable upon the exercise of this
Warrant shall be changed to the number determined by dividing (i) an amount
equal to the number of shares issuable upon the exercise of this Warrant
immediately prior to such adjustment, multiplied by the Purchase Price in
effect immediately prior to such adjustment, by (ii) the Purchase Price in
effect immediately after such adjustment.
(b) Reclassification, Etc. In case there occurs any reclassification
or change of the outstanding securities of the Company or of any
reorganization of the Company (or any other corporation the stock or
securities of which are at the time receivable upon the exercise of this
Warrant) or any similar corporate reorganization on or after the date hereof,
but before the Expiration Date, then and in each such case the Registered
Holder, upon the exercise hereof at any time after the consummation of such
reclassification, change, or reorganization shall be entitled to receive, in
lieu of the stock or other securities and property otherwise receivable upon
the exercise hereof prior to such consummation, the stock or other securities
or property to which such Registered Holder would have been entitled upon such
consummation if such Registered Holder had exercised this Warrant immediately
prior thereto, all subject to further adjustment pursuant to the provisions of
this Section 2.
(c) Adjustment Certificate. When any adjustment is required to be
made in the Warrant Stock or the Purchase Price pursuant to this Section 2,
the Company shall promptly mail to the Registered Holder a certificate setting
forth (i) a brief statement of the facts requiring such adjustment, (ii) the
Purchase Price after such adjustment and (iii) the kind and amount of stock or
other securities or property into which this Warrant shall be exercisable
after such adjustment.
3. Transfers; Restrictions on Transferability.
(a) Unregistered Security. Each holder of this Warrant acknowledges
that this Warrant and the Warrant Stock have not been registered under the
Securities Act of 1933, as amended (the "Securities Act"), and agrees not to
sell, pledge, distribute, offer for sale, transfer or otherwise dispose of
this Warrant or any Warrant Stock issued upon exercise of this Warrant in the
absence of (i) an effective registration statement under the Act as to this
Warrant or such Warrant Stock and registration or qualification of this
Warrant or such Warrant Stock under any applicable U.S. federal or state
securities law then in effect or (ii) an opinion of counsel, satisfactory to
the Company, that such registration and qualification are not required. Each
certificate or other instrument for Warrant Stock or such other securities
shall bear a legend substantially to the foregoing effect. Each holder of this
Warrant or Warrant Stock and each subsequent transferee (hereinafter
collectively referred to as a "Restricted Holder") consents to the Company
making a notation on its records and giving instructions to any applicable
transfer agent in order to implement the restrictions on transfer set forth in
this Section 3.
(b) Transferability. This Warrant and the rights of the Registered
Holder may not be sold, transferred or otherwise disposed of, in whole or in
part, except to any Permitted Transferee of the Registered Holder, subject to
compliance with Section 3(a) hereof; provided, however, that this Warrant may
not be transferred in part. Any such transfer shall be effective upon
surrender of the Warrant with a properly executed assignment (in the form of
Exhibit B-1 hereto) and funds sufficient to pay any transfer tax, at the
principal office of the Company. "Permitted Transferee" shall mean (i) the
Company, (ii) any subsidiary of the Company and (iii) any Affiliate of the
Registered Holder. "Affiliate" shall mean (i) with respect to any individual,
(A) a spouse or descendant of such individual, (B) any trust or family
partnership whose beneficiaries shall solely be such individual and/or such
individual's spouse and/or any person related by blood or adoption to such
individual or such individual's spouse and (C) the estate of such individual,
(ii) with respect to any Person which is not an individual, any other Person
that, directly or indirectly through one or more intermediaries controls, is
controlled by, or is under common control with, such Person and/or one or more
Affiliates thereof. For the purposes of this Section 3(b), the term "control"
(including, with correlative meanings, the terms "controlled by" and "under
common control with"), as used with respect to any Person, includes, without
limitation, the possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of such Person, whether
through the ownership of voting securities, by agreement or otherwise.
"Person" shall mean and includes an individual, a corporation, a partnership,
a limited liability company, a joint venture, a trust, an unincorporated
organization and a government or any department or agency thereof, or any
entity similar to any of the foregoing.
(c) Restrictive Legend. Each certificate representing the Warrant
Stock and any other securities issued in respect of the Warrant Stock upon any
stock split, stock dividend, recapitalization, merger, consolidation or
similar event, shall (unless otherwise permitted by the provisions of this
Warrant) 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 HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, (THE "ACT") OR UNDER ANY STATE
SECURITIES LAWS, AND MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL
REGISTERED UNDER THE ACT OR UNLESS THE COMPANY HAS RECEIVED AN
OPINION OF COUNSEL SATISFACTORY TO THE COMPANY AND ITS COUNSEL THAT
SUCH REGISTRATION IS NOT REQUIRED.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE (AND ALL TRANSFERS
THEREOF) ARE SUBJECT TO THE RESTRICTIONS ON TRANSFER SET FORTH IN THE
REGISTRATION RIGHTS AGREEMENT, DATED AS OF _________________, A COPY
OF WHICH IS ON FILE AT THE PRINCIPAL OFFICE OF THE COMPANY. NO
TRANSFER OF SUCH SHARES WILL BE MADE ON THE BOOKS OF THE COMPANY
UNLESS ACCOMPANIED BY EVIDENCE OF COMPLIANCE WITH THE TERMS OF SUCH
AGREEMENT AND BY AN AGREEMENT OF THE TRANSFEREE TO BE BOUND BY THE
RESTRICTIONS SET FORTH THEREIN. ANY ATTEMPTED TRANSFER OF THESE
SHARES IN VIOLATION OF SUCH REGISTRATION RIGHTS AGREEMENT SHALL BE
NULL AND VOID AND HAVE NO FORCE OR EFFECT.
(d) Removal of Restrictions on Transfer of Securities. Any legend
referred to in subsection (c) hereof stamped on a certificate evidencing the
Warrant Stock and the stock transfer instructions and record notations with
respect to the Warrant Stock shall be removed, and the Company shall issue a
certificate without such legend to the Restricted Holder of the Warrant Stock,
if the Warrant Stock is registered under the Securities Act or if such
Restricted Holder provides the Company with an opinion of counsel (which may
be counsel for the Company) reasonably satisfactory to the Company to the
effect that a public sale or transfer of such security may be made without
registration under the Securities Act.
(e) Warrant Register. The Company will maintain a register containing
the names and addresses of the Registered Holders of this Warrant. Until any
transfer of this Warrant is made in the warrant register, the Company may
treat the Registered Holder of this Warrant as the absolute owner hereof for
all purposes; provided, however, that if this Warrant is properly assigned in
blank, the Company may (but shall not be required to) treat the bearer hereof
as the absolute owner hereof for all purposes, notwithstanding any notice to
the contrary. Any Registered Holder may change such Registered Holder's
address as shown on the warrant register by written notice to the Company
requesting such change.
4. No Impairment. The Company will not, by amendment of its charter
or through reorganization, consolidation, merger, dissolution, sale of assets
or any other voluntary action, avoid or seek to avoid the observance or
performance of any of the terms of this Warrant, but will at all times in good
faith assist in the carrying out of all such terms and in the taking of all
such action as may be necessary or appropriate in order to protect the rights
of the holder of this Warrant against impairment.
5. Termination. This Warrant (and the right to purchase shares of
Warrant Stock upon exercise hereof) shall terminate on the earlier to occur of
(a) the date the Registered Holder purchases all of the Warrant Stock issuable
upon exercise of this Warrant and (b) at 5:00 p.m., Los Angeles time on
_____________ (in each case, the "Expiration Date").
6. Notices of Certain Transactions. In case:
(a) the Company shall take a record of the holders of its Common
Stock (or other stock or securities at the time deliverable upon the exercise
of this Warrant) for the purpose of entitling or enabling them to receive any
dividend or other distribution, or to receive any right to subscribe for or
purchase any shares of stock of any class or any other securities, or to
receive any other right, to subscribe for or purchase any shares of stock of
any class or any other securities, or to receive any other right, or
(b) of any capital reorganization of the Company, any
reclassification of the capital stock of the Company, any consolidation or
merger of the Company, any consolidation or merger of the Company with or into
another corporation (other than a consolidation or merger in which the Company
is the surviving entity), or any transfer of all or substantially all of the
assets of the Company, or
(c) of the voluntary or involuntary 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 Registered Holder of this Warrant a notice specifying, as the case may be,
(i) 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 (ii) the effective date on which such
reorganization, reclassification, consolidation, merger, transfer,
dissolution, liquidation, winding-up, redemption or conversion is to take
place, and the time, if any is to be fixed, as of which the holders of record
of Common Stock (or such other stock or securities at the time deliverable
upon such reorganization, reclassification, consolidation, merger, transfer,
dissolution, liquidation, winding-up, redemption or conversion) are to be
determined. Such notice shall be mailed at least ten days prior to the record
date or effective date for the event specified in such notice.
7. Reservation of Stock. The Company will at all times reserve and
keep available, solely for the issuance and delivery upon the exercise of this
Warrant, such shares of Warrant Stock and other stock, securities and
property, as from time to time shall be issuable upon the exercise of this
Warrant.
8. Exchange of Warrant. Subject to the terms hereof, upon the
surrender by the Registered Holder of this Warrant, properly endorsed, to the
Company at the principal office of the Company, the Company will, subject to
the provisions of Section 3 hereof, issue and deliver to or upon the order of
the Registered Holder, at the Company's expense, a new Warrant of like tenor,
in the name of such Registered Holder or as such Registered Holder (upon
payment by such Registered Holder of any applicable transfer taxes) may
direct, calling for the number of shares of Warrant Stock called for on the
face of this Warrant or if partially exercised, such lesser number of shares
that shall be issuable upon exercise of this Warrant.
9. Replacement of Warrant. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and (in the case of loss, theft or destruction) upon delivery of
an indemnity agreement (with surety if reasonably required) in an amount
reasonably satisfactory to the Company to indemnify it against any claim that
may be made against it on account of the alleged loss, theft, destruction or
the issuance of a new Warrant, or (in the case of mutilation) upon surrender
and cancellation of this Warrant, the Company will issue, in lieu thereof, a
new Warrant of like tenor.
10. Mailing of Notices. Any notice required or permitted pursuant to
this Warrant shall be in writing and shall be deemed sufficient upon receipt,
when delivered personally or sent by courier, overnight delivery service or
confirmed facsimile, or 48 hours after being deposited in the regular mail, as
certified or registered mail (airmail if sent internationally), with postage
prepaid, addressed (a) if to the Registered Holder, to the address of the
Registered Holder most recently furnished in writing to the Company, and (b)
if to the Company, to the address set forth below or subsequently modified by
written notice to the Registered Holder.
11. No Rights as Stockholder. Until the exercise of this Warrant, the
Registered Holder of this Warrant shall not have or exercise any rights by
virtue hereof as a stockholder of the Company, either at law or in equity.
12. No Fractional Shares. No fractional shares of Warrant Stock will
be issued in connection with any exercise hereunder. In lieu of any fractional
shares which would otherwise be issuable, the Company shall pay cash equal to
the product of such fraction multiplied by the Fair Market Value of one share
of Warrant Stock on the date of exercise, as determined in good faith by the
Company's Board of Directors.
13. Amendment or Waiver. Any term of this Warrant may be amended or
waived only by an instrument in writing signed by the party against which
enforcement of the amendment or waiver is sought.
14. Headings. The headings in this Warrant are for purposes of
reference only and shall not limit or otherwise affect the meaning of any
provision of this Warrant.
15. Governing Law. This Warrant shall be governed, construed and
interpreted in accordance with the laws of the State of New York, without
giving effect to principles of conflicts of law.
(Signature Page Follows)
IN WITNESS WHEREOF, the undersigned has caused this Warrant to be
duly executed, all as of the day and year first above written.
US SEARCH.COM INC.
By :____________________________
Name:
Title:
Address: 5401 Beethoven Street
Los Angeles, CA 90066
Fax Number: (310) 882-7898
EXHIBIT A-1
PURCHASE FORM
To: US SEARCH.com Inc. Dated:
The undersigned, pursuant to the provisions set forth in the attached
Warrant No. __, hereby irrevocably elects to purchase _______ shares of the
Common Stock covered by such Warrant and herewith makes payment of $_________,
representing the aggregate purchase price for such shares at the price per
share provided for in such Warrant.
Signature: ________________________________
Name (print): _____________________________
Title (if applic.):________________________
Company (if applic.):______________________
EXHIBIT A-2
NET ISSUE NOTICE OF EXERCISE
TO: _______________________________
_______________________________
_______________________________
Attention:
1. The undersigned hereby elects to purchase _________ shares of
Common Stock of USSEARCH.com Inc., pursuant to the terms of this Warrant, and
hereby elects under Section 1(c) to surrender the right to purchase _______
shares of Common Stock pursuant to this Warrant for a net issue exercise with
respect to ________ shares of Common Stock.
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
is specified below:
______________________________
(Name)
______________________________
______________________________
(Address)
3. The undersigned hereby represents and warrants that the aforesaid
shares of Common Stock 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.
____________________________
(Signature)
Title:______________________
________________________
(Date)
EXHIBIT B-1
ASSIGNMENT FORM
FOR VALUE RECEIVED, _________________________________________ hereby
sells, assigns and transfers all of the rights of the undersigned under the
attached Warrant with respect to the number of shares of Common Stock, par
value $.001 per share, of US SEARCH.com Inc., a Delaware corporation, covered
thereby set forth below, unto:
Name of Assignee Address/Fax Number No. of Shares
Dated:_________________ Signature:_______________________
_______________________
Witness: ________________________
EXHIBIT 7
Executive Officers and Directors of The First American Corporation