<PAGE>   1
                     U.S. Securities and Exchange Commission

                             Washington, D.C. 20549


                                  Form 10-KSB/A
                                 Amendment No. 4


(Mark One)

[x]      ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
         EXCHANGE ACT OF 1934

For the fiscal year ended September 30, 2000

[ ]      TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
         ACT OF 1934

         For the transition period from _______________ to _______________

         Commission file number 000-22849

                             Visual Data Corporation
                 ----------------------------------------------
                 (Name of small business issuer in its charter)

                                     Florida
                      ------------------------------------
         (State or other jurisdiction of incorporation or organization)

                                   65-0420146
                      ------------------------------------
                      (I.R.S. Employer Identification No.)

                   1291 SW 29 Avenue, Pompano Beach, FL 33069
               --------------------------------------------------
               (Address of principal executive offices)(Zip Code)

                     Issuer's telephone number 954-917-6655

         Securities registered under Section 12(b) of the Exchange Act:

                                      None
                              ---------------------
                              (Title of each class)

                    Name of each exchange on which registered

                                 not applicable
                    -----------------------------------------

         Securities registered under Section 12(g) of the Exchange Act:

                                  Common Stock
                    -----------------------------------------

                    Redeemable Common Stock Purchase Warrants
                    -----------------------------------------
                                (Title of Class)


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         Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. Yes [x] No []

         Check if there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-B is not contained in this form, and no disclosure will
be contained, to the best of the registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [x]

         State issuer's revenues for its most recent fiscal year. $5,868,435 for
the 12 months ended September 30, 2000.

         State the aggregate market value of the voting stock held by
non-affiliates computed by reference to the price at which the stock was sold,
or the average bid and asked prices of such stock, as of a specified date within
the past 60 days. The aggregate market value of the voting stock held by
non-affiliates computed at the closing price of the Company's common stock on
December 15, 2000 is approximately $20,400,490.

         State the number of shares outstanding of each of the issuer's class of
common equity, as of the latest practicable date. As of December 15, 2000,
8,453,358 shares of Common Stock are issued and outstanding.

                       DOCUMENTS INCORPORATED BY REFERENCE

         If the following documents are incorporated by reference, briefly
describe them and identify the part of the Form 10-KSB into which the document
is incorporated: (1) any annual report to security holders; (2) any proxy or
information statement; and (3) any prospectus filed pursuant to Rule 424(b) of
the Securities Act of 1933 ("Securities Act"). Not Applicable.

         Transitional Small Business Disclosure Form (check one):

         Yes [ ]  No [X]

         The discussion in this Annual Report on Form 10-KSB regarding the
Company and its business and operations includes "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1996. Such
statements consist of any statement other than a recitation of historical fact
and can be identified by the use of forward-looking terminology such as "may,"
"expect," "anticipate," "estimate" or "continue" or the negative thereof or
other variations thereon or comparable terminology. The reader is cautioned that
all forward-looking statements are necessarily speculative and there are certain
risks and uncertainties that could cause actual events or results to differ
materially from those referred to in such forward looking statements. The
Company does not have a policy of updating or revising forward-looking
statements and thus it should not be assumed that silence by management of the
Company over time means that actual events are bearing out as estimated in such
forward looking statements.


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                                     PART I

Item 1.  DESCRIPTION OF BUSINESS

General

         Visual Data Corporation ("VDC" or the "Company"), organized in 1993, is
a full service provider of streaming-content applications, production technology
and media solutions. Using advanced technology and information solutions, we
provide a sensory-rich experience to businesses and consumers enabling them to
make superior decisions.

         Visual Data is comprised of four operating groups including:

                  Visual Data Travel Group (includes HotelView, ResortView,
                  etc..)

                  Visual Data On-line Broadcast and Production Group (includes
                  Webcasting, Live audio and video events, etc..)

                  Visual Data Networking Solutions Group (Ednet)

                  Visual Data Financial Solutions Group (TheFIrstNews.com)

         Products and services provided by each of the groups are:

Visual Data Travel Group

         The Visual Data Travel Group produces high quality, Internet-based
multi-media streaming videos such as hotel, resort, golf facility, travel
destination and time-share productions designed to keep a high level of viewer
interest. These concise, broadband-enabled "vignettes" generally have running
times from 2-4 minutes. By incorporating the services of many of the largest
travel and leisure web-sites, VDC has created a unique distribution channel for
travel industry businesses such as hotel chains and golf courses to
significantly augment their marketing programs using highly effective
multi-media applications.


         The Visual Data Travel Group, which represented approximately 6% of
our revenues for the year ended September 30, 2000, generates revenues from
production and distribution fees. We own or co-own virtually all the content we
create, which we believes provides us with desirable content for syndication.



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Visual Data On-line Broadcast and Production Group

         The Visual Data On-line Broadcast and Production group provides an
array of corporate-oriented web-based media services to the corporate market
including live audio and video webcasting, packaged corporate announcements, and
information distribution (Internet, broadcast TV and radio) for any business
entity, and can provide point-to-point audio and video transport worldwide.
Significant to this business division is our strategic partnership with the
Internet's leading press release service, PR Newswire, providing a global sales
force to promote the VDC broadband corporate services packages. Visual Data also
completed development of a suite of trade show related broadband media services
including a "Virtual Exhibit Hall", rich-video filming, key-note speaker
interview vignettes, and conference webcasting. All have the benefit of
extending the life of a trade show, a highly attractive proposition for show
producers and exhibitors alike. Our On-line Broadcast and Production Group,
which represented approximately 18% of our revenues for the year ended September
30, 2000, generates revenues through production and distribution fees.


Visual Data Networking Solutions Group

         Visual Data's Networking Solutions Group consists of our Ednet
("Ednet") subsidiary, which provides connectivity within the entertainment and
advertising industries through its private network, which encompasses production
and post-production companies, advertisers, producers, directors, and talent.
The network enables trouble-free, high-speed exchange of high quality audio,
compressed video and multimedia data communications, utilizing long distance
carriers, regional phone companies, satellite operators, and major Internet
Service Providers. Ednet also provides systems integration and engineering
services, application-specific technical advice, web-casting services, audio
equipment, proprietary and off-the-shelf codecs, teleconferencing equipment, and
other innovative products to facilitate Visual Data's broadcast and production
applications.

         Ednet manages a rapidly expanding global network of over 500 North
American Affiliates, and nearly 200 International Associates, in cities
throughout the United States, Canada, Mexico, Europe, and the Pacific Rim. Our
Network Solutions Group, which represented approximately 71% of our revenues for
the year ended September 30, 2000, generates revenues from the sales, rental and
installation of equipment, network usage, distribution fees and other related
fees.

Visual Data Financial Solutions Group

         Visual Data's Financial Solutions Group was established in November
1999 to further realize the potential for our audio content delivery capability.
TheFirstNews.com(TM) the initial service of the division was created to address
information needs for the financial sector. TheFirstNews.com(TM), is an Internet
based news service that delivers aggregated, up-to-the-minute corporate and
business live-audio and text content - in a constant stream throughout the
trading day. Patent pending preference technology allows the user to selectively
hear the stories for


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individual stocks and industry segments that they want to hear. TheFirstNews.com
brings the latest business information from the top corporate news sources--just
minutes after it is released - with no spin, slant or editorial angle.

         TheFirstNews.com affords investors and financial professionals
accessibility to timely, filtered financial and news information, including
press releases, Internet webcasts and teleconferences. Subscribers benefit from
VDC generated proprietary content and reported stories, improved programming,
additional news sources and trading tools. Our Financial Solutions Group, which
represented less than 1% of our revenues for the year ended September 30, 2000,
generates revenues from monthly subscription fees, revenue sharing arrangements
with affiliates, advertising fees and content licensing fees.


Sales and Marketing

         We use a variety of additional marketing methods, including our
internal sales force, to market our products and services. One key element of
our marketing strategy has been to enter into distribution agreements with
recognized leaders in each of the markets for our products and services. By
offering our products and services in conjunction with the distributors
products, we believe these distribution agreements enable us to take advantage
of the particular distributors' existing marketing programs, sales forces and
business relationships. Contracts with these distributors generally range from
one to two years. For the fiscal year ended September 30, 2000, revenues from
our agreements with PR Newswire have represented approximately 17% of our
revenues. Other than this agreement, no other agreement with a distributor has
represented more than 10% of our revenues during this period.

Our Products and Services

         We are a leading producer and owner of original video content
specifically developed for the Internet and interactive television. In addition
to revenues generated from our core businesses, we recorded revenues in fiscal
2000 and 1999 from equipment sales, installation and usage fees from our
majority owned subsidiary Ednet. We anticipate that the majority of our future
revenues will be from various streaming-content applications, production
technology, media solutions and distribution. The revenue associated with the
distribution of the content will primarily be either a recurring flat fee per
month or a continuation of our pay-per-view program.

Visual Data Travel Group - Products and Services

         HotelView(R) - www.hotelview.com

         Our HotelView(R) library provides two to four minute multimedia video
tours that give the viewer a detailed look at the hotel's guestrooms, grounds,
meeting space,


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recreational facilities, dining venues and other amenities. It also includes a
map showing the hotel's location relative to area attractions and airports. The
video tour can be accessed through the participating hotel's own Website,
HotelView's Website at www.hotelview.com, and hundreds of other Websites.


         HotelView(R) streaming video vignettes feature hotels, throughout the
world including the Anaheim (California) Hilton & Towers, Baltshug Kempinski
(Moscow), Eden Roc Resort & Spa (Miami), Hilton at Walt Disney World Village,
Hotel Nikko (San Francisco), Ritz Carlton Laguna (Niguel California), Vier
Jahreszeiten (Berlin) and the Waldorf Astoria (New York).

         HotelView's revenues are generated through an annual subscription fee,
which includes the creation, storage and serving of the video on the Internet.
Hotels have the option of paying via a monthly per-view revenue plan, or via a
fixed monthly fee plan, in addition to an annual fee plan.

         ResortView(R) -- www.resortview.com

         Our ResortView(R) library provides developers of timeshare properties
with the ability to advertise their resort to a more targeted, and potentially
larger, prospect audience than they have had in the past. It is accessible via
travel agents, at home or work via the Internet. ResortView(R) then "closes the
loop" by allowing the property to be booked by travel agencies throughout the
world utilizing the Global Distribution System ("GDS"). GDS is the electronic
database that travel agents around the world use to research and book rooms in
hotels and resorts. Through an exclusive distribution and marketing agreement
with Interval International, Inc., the second largest marketing organization in
the timeshare industry with properties world-wide, ResortView(R) has been
designed to use video advertising in conjunction with the GDS to promote lead
generation and rental income for the resort developers.

         Revenues are generated via an annual membership fee. In addition,
Visual Data receives a commission on each completed stay realized by the resort.
Current ResortView(R) properties include Harbour Lights (Myrtle Beach), Newport
Beachside Hotel and Resort (Miami Beach), The Royal Resorts (Cancun), Isle of
Bali (Orlando), Fairfield Royal Vista (Pompano Beach, Florida) and Peppertree at
Wild Wing (Conway, South Carolina).

         AttractionView(TM) -- www.attractionview.com

         Many vacation planners need more than just information about the
accommodations, and AttractionView(TM) has been designed as a natural complement
to HotelView(R) and ResortView(R). AttractionView(TM) focuses on marrying the
neighboring attractions, such as amusement parks, theme parks, regional malls,
and the like to the


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HotelView(R) and ResortView(R) accommodations. Our existing library includes
information on the United Nations in New York, the Kennedy Space Center in
Florida and Busch Gardens in Tampa.

         Revenues from the marketing of AttractionView(TM) will be generated
through an annual subscription fee, which includes the creation, storage and
serving of the video on the Internet, and recurring revenues, which will be paid
by the attraction, each time someone views the video on the Internet.

         DestinationView(TM) - www.destinationview.com

         In addition to Attractionview(TM), DestinationView(TM) has been
designed to provide additional information to travelers on the specific
destination including tours of the area, major attractions, historical places,
recreational facilities and shopping/dining venues. Our existing library
includes many destinations including Paris, London, Las Vegas, South Florida,
Seychelles, Hawaii, Jamaica and Hong Kong.

         Revenues from the marketing of DestinationView(TM) will be generated
through an annual subscription fee, which includes the creation, storage and
serving of the video on the Internet, and recurring revenues, which will be paid
by the tourist boards/local hotel associations.

         GolfersView(TM) - www.golfersview.com

         In April 1999, Visual Data acquired the Internet broadcast rights to a
collection of golf-related videos including approximately 200 course tours,
instructional videos and golf-related attractions from an unaffiliated third
party. GolfersView(TM) provides full-motion tours of some of the world's most
renowned golf courses and resorts and related attractions, including Pebble
Beach, Innisbrook and the Golf Hall of Fame, as well as instructional videos and
golf products and services. We are also distributing these videos in conjunction
with our other travel related content on websites such as Yahoo Broadcast and
RoadRunner where they are aggregated by destination.

         Revenues will be generated through an annual subscription fee, which
includes the creation, storage and serving of the video on the Internet, and
recurring revenues, which will be paid by the golf course, each time someone
views the video on the Internet.

         CruiseView(TM) - www.cruiseview.com

         We have designed CruiseView(TM) to provide a detailed video tour of a
ship's guestrooms, common areas, recreational facilities and dining venues. As
the cruise market continues to grow, we believe cruise lines will need to
utilize a service like


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CruiseView(TM) to maximize their exposure to the travel agents of the world. We
intend to position CruiseView(TM) to take early advantage of these opportunities
as a result of our existing presence in the travel agency networks.

         Revenues are generated through an annual subscription fee, which
includes the creation, storage and serving on the Internet, and recurring
revenues, which are paid by the cruise line, each time someone views the video
on the Internet.

Visual Data On-line Broadcast and Production Group - Products and Services

         The Visual Data On-line Broadcast and Production Group was created to
provide a cost effective means for corporations to broadcast analyst conference
calls live, making them available to the investing public, the media and
worldwide to anyone with Internet access. Visual Data markets the On-line
Broadcast and Productions Solutions webcasting products through a direct sales
channel, and in conjunction with our business partner, PR Newswire. Each Visual
Data webcast can be archived for replay for an additional fee and the archived
material can be accessed through a company's own website. Major corporations and
small businesses are hiring Visual Data to produce live webcasts and custom
videos for the web to communicate corporate earnings announcements, conference
calls on the web, speeches on demand, product launches, internal training,
corporate video news and profiles, crisis communications, visual trade shows,
and basic online multimedia fulfillment.

         Revenues are generated through the production and storage of all the
multi-media content produced and distributed by the Company. In addition we
generate revenues from the production of video press releases, video corporate
profiles and video footage of events.

         Services include:

         *        Earnings Announcements
         *        Conference Calls
         *        Product Launches
         *        Speeches-on demand, with multimedia sideshows
         *        Online Meetings (One way or two way live or on demand)
         *        Video Conferencing
         *        Corporate Video Snapshot
         *        Corporate News in Video
         *        Custom Streaming-Video Production

         The On-Line Broadcast and Production Solutions Group also produces
syndicated content for the healthcare industry under the name MedicalView(TM),
described on our www.medicalview.com website.


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         MedicalView's primary objective is to provide online consumers with
access to a comprehensive video library of healthcare programming designed
exclusively for the Internet. Presented in streaming video, MedicalView
programming is designed to answer frequently asked questions about the most
common health topics and concerns.

         The MedicalView library provides the growing online, broadband
community with access to on-demand information on subjects such as cancer, heart
disease, sports medicine & orthopedics, eye care, surgical procedures,
nutrition, and pregnancy just to name a few. Each topic is presented as a series
of video vignettes addressing frequently asked questions on disease prevention,
recognition, diagnosis, and appropriate treatments. MedicalView is partnering
with board certified physicians and accredited medical institutions to insure
that the material is both informative and accurate.

         The MedicalView library is being distributed under syndication and
licensing arrangements with individual web sites. The content is made available
by individual video clips, by health topic, or as an entire library.

         Revenues are generated through content licensing agreements, medical
industry webcasts and sponsorships. The video content is licensed under either a
private label or co-branded format and the fee is based on the number of video
clips and health topics used and the duration of the agreement. MedicalView is
also obtaining pharmaceutical industry sponsorships for its various programs.

Visual Data Networking Solutions Group - Products and Services

         In June 1998, we acquired a 51% interest in Entertainment Digital
Network, Inc. (OTCBB: EDNT). Based in San Francisco, CA. Ednet develops and
markets integrated systems for the delivery, storage and management of
professional quality digital communications for media-based applications,
including audio and video production for the North American advertising and
entertainment industries. Ednet has established a private wide-area network
(WAN) through strategic alliances with long distance carriers, regional
telephone companies, satellite operators and independent fiber optic
telecommunications providers, which enables the exchange of high quality audio,
compressed video and multimedia data communications. Ednet provides engineering
services, application-specific technical advice, and audio, video and networking
hardware and software as part of its business.

         During 1999, Ednet teamed with Telestream, a manufacturer of high
quality video delivery systems, to provide Ednet customers the means to send
high quality video via the Internet and other Internet Protocol (IP) based WANS.
Under the terms of


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the agreement, Ednet provides complete turnkey solution, bundling Telestream
video equipment with their network services. It is anticipated that this
relationship will provide Ednet's entertainment and advertising company clients
the ability to cost effectively transmit their daily shots of commercials,
special effects, graphics, storyboards and animated shots, thereby providing a
more dependable and faster delivery system than was previously available.

         In order to maintain the 51% interest acquired, we received an option
to purchase, at an exercise price of $.10 per share, the number of shares
actually purchased upon exercise of each option, warrant and other convertible
security of Ednet outstanding at the date of closing the Ednet transaction (the
"Ednet Stock Equivalents"). Based upon the number of Ednet Stock Equivalents
outstanding, we have the right to purchase up to an aggregate of 2,647,793
shares of Ednet's common stock. Our right to exercise the options shall accrue
on the date of issuance of shares of Ednet common stock upon exercise of the
corresponding outstanding Ednet Stock Equivalents and shall expire on the first
anniversary of the exercise date of each such outstanding Ednet Stock
Equivalent. During the year ended September 30, 2000 and 1999, we exercised
options and warrants to purchase a total of 344,525 and 3,212,231 shares,
respectively, of Ednet Common Stock.

Visual Data Financial Solutions Group - Products and Services

         The Visual Data Financial Solutions Group's TheFirstNews.com has been
fully operational for one year as an internet-based, live audio news broadcast
service and is uniquely positioned for growth in both wireless and PC desktop
environments. Our goal is to provide financial professionals, brokers and active
traders with "stock-affecting" content using our proprietary software and
patent-pending technology. We currently provide our content to 75 corporate
Affiliates and a growing individual subscriber base. Our subscribers are able to
listen to "live" audio excerpts as well as, view short and long version text
stories about stocks and market sectors they prefer to listen to - when they
want! Our information is delivered in real time streaming audio, with "no spin,"
to personal computers, wireless telephones and personal digital assistants.
TheFirstNews.com maintains strategic partnerships and revenue-sharing
relationships with PR Newswire, Yahoo.com, Bloomberg.com and Zacks Investment
Research.

         TheFirstNews.com affords investors and financial professionals
accessibility to timely, filtered financial and news information, including
press releases, Internet webcasts and teleconferences. Subscribers benefit from
VDC generated proprietary content and reported stories, improved programming,
additional news sources and trading tools. TFN's business model includes
revenues from end-user subscriptions, content syndication, affiliate site
licenses and source company promotion programs.

Competition


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         The market for Internet broadcast services and video content is
relatively new, rapidly evolving and highly competitive. We expect our
competition to intensify. We compete with:

         *        other websites, Internet portals and Internet broadcasters to
                  acquire and provide content to attract users;

         *        video and audio conferencing companies and Internet business
                  services broadcasters;

         *        online services, other Website operators and advertising
                  networks; and

         *        traditional media such as television, radio and print.

         Visual Data believes it is one of the premier Internet broadcaster's
offering an end-to-end solution for production and serving digital video on the
Internet, however, we face competition from a number of other companies,
including local production companies and other travel content Websites. We
believe Visual Data stands apart from its competitors in that they do not
provide their customers with production or editing services, extensive
distribution and they do not own the content that is aggregated on their site.
In contrast, we create and produce most of our content and own virtually all the
video and audio content on our Websites.

Government Regulation

         Although there are currently few laws and regulations directly
applicable to the Internet, it is likely that new laws and regulations will be
adopted in the United States and elsewhere covering issues such as music
licensing, broadcast license fees, copyrights, privacy, pricing, sales taxes and
characteristics and quality of Internet services. It is possible that
governments will enact legislation that may be applicable to us in areas such as
content, network security, encryption and the use of key escrow, data and
privacy protection, electronic authentication or "digital" signatures, illegal
and harmful content, access charges and retransmission activities. Moreover, the
applicability to the Internet of existing laws governing issues such as property
ownership, content, taxation, defamation and personal privacy is uncertain. The
majority of such laws were adopted before the widespread use and
commercialization of the Internet and, as a result, do not contemplate or
address the unique issues of the Internet and related technologies. Any such
export or import restrictions, new legislation or regulation or governmental
enforcement of existing regulations may limit the growth of the Internet,
increase our cost of doing business or increase our legal exposure, which could
have a material adverse effect on our business, financial condition and results
of operations.


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         By distributing content over the Internet, we face potential liability
for claims based on the nature and content of the materials that we distribute,
including claims for defamation, negligence or copyright, patent or trademark
infringement, which claims have been brought, and sometimes successfully
litigated, against Internet companies. To protect Visual Data from such claims,
we maintain general liability insurance. The general liability insurance may not
cover all potential claims of this type or may not be adequate to indemnify
Visual Data for any liability to which we may be imposed. Any liability not
covered by insurance or in excess of insurance coverage could have a material
adverse effect on our business, results of operations and financial condition.

Intellectual Property

         Our success depends in part on our ability to protect our intellectual
property. To protect our proprietary rights, we rely generally on copyright,
trademark and trade secret laws, confidentiality agreements with employees and
third parties, and agreements with consultants, vendors and customers, although
we have not signed such agreements in every case. Despite such protections, a
third party could, without authorization, copy or otherwise obtain and use our
content. We can give no assurance that our agreements with employees,
consultants and others who participate in development activities will not be
breached, or that we will have adequate remedies for any breach, or that our
trade secrets will not otherwise become known or independently developed by
competitors.

         We pursue the registration of certain of our trademarks and service
marks in the United States, although we have not secured registration of all our
marks. In addition, the laws of some foreign countries do not protect our
proprietary rights to the same extent as do the laws of the United States, and
effective copyright, trademark and trade secret protection may not be available
in such jurisdictions. In general, there can be no assurance that our efforts to
protect our intellectual property rights through copyright, trademark and trade
secret laws will be effective to prevent misappropriation of our content. Our
failure or inability to protect our proprietary rights could materially
adversely affect our business, financial condition and results of operations.

         As part of TheFirstNews.com, we have a patent pending for a proprietary
technology, "Method for Manipulating a Live Audio Media Stream". This patent was
filed on November 23, 1999 under Docket No. 1285.012, by Marc Goldstein, and
assigned to us on the same date.

Employees

         We currently have 88 full-time employees, of whom 44 are design,
production and technical personnel, 19 are sales and marketing personnel and 25
are general,


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administrative and executive management personnel. None of the employees are
covered by a collective bargaining agreement and our management considers
relations with employees and consultants to be good.

Item 2.  DESCRIPTION OF PROPERTY

         In September 1997, we purchased from an unaffiliated third party a
25,000 square foot facility in Pompano Beach, Florida which now serves as our
corporate headquarters and houses all of our production, marketing and
distribution activities, exclusive of our Ednet subsidiary. The aggregate
purchase price paid for the facility was $1,475,000, comprised of $475,000 in
cash and an 18-month first mortgage in the principal amount of $1,000,000,
bearing interest at the rate of 8.75% per annum, with 15-year amortization. In
March 1999 we refinanced this mortgage. The current mortgage in the principal
amount of $1,000,000, which is held by a bank, bears interest at 8.75% per annum
on a 15 year amortization, and the unpaid principal balance and any accrued
interest is due on September 30, 2002. We do not anticipate any difficulty in
refinancing the property prior to the due date of this mortgage.

         Ednet's principal business offices are located at One Union Street, in
San Francisco, California. This office is a 5,000 square foot facility that
operates as administrative headquarters and provides the centralized network hub
for electronically bridging affiliate studios, as well as overall network
management. Ednet leases this facility pursuant to a Sublease dated November 1,
1993 with Varitel Video, Inc. ("Varitel"), an unaffiliated entity. The term of
the sublease was for five years, commencing November 15, 1993. At November 14,
1998, the lease was renewed for an additional term ending August 31, 2003. Under
the renewed sublease, the monthly lease payment is $13,251 per month. In lieu of
a security deposit, Ednet granted Varitel a security interest in certain of
Ednet's equipment with an aggregate purchase price of approximately $75,000.
Varitel may terminate this sublease upon 90 days prior written notice, upon a
change in the principal ownership of Ednet or in the event that Ednet engages in
a "competing type of film or video service business like or similar to Varitel".
This excludes any "networking service application" which we offer in connection
with audio, video and other multimedia networking services. Varitel has agreed
not to terminate the lease due to our purchase of 51% of Ednet.

Item 3.  LEGAL PROCEEDINGS

         On or about October 18, 1999, Peter Bisulca instituted an action
against Visual Data and Randy Selman, our Chief Executive Officer and President,
individually, entitled Bisulca v. Visual Data Corporation and Randy S. Selman,
Case No. CL 99-9971 AD, in the 15th Judicial Circuit in and for Palm Beach
County, Florida. The Complaint alleged breach of contract and conversion against
Visual Data and tortious interference with contract against Randy S. Selman,
seeking damages in excess of


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$2,000,000 in connection with a Consulting Agreement dated May 1, 1998,
allegedly entered into between Visual Data and Peter Bisulca. A Motion to
Dismiss was filed on behalf of Visual Data and Randy S. Selman, the hearing on
which was cancelled as a result of the Complaint being amended. The Complaint
was amended to no longer include Randy S. Selman as a defendant and the claim
for conversion was dropped. The Company intends to vigorously defend itself in
this action and, in the opinion of management, the ultimate outcome of this
matter will not have a material impact on the Company's financial position or
results of operations.

Item 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         None.

                                     PART II

Item 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

         Our common stock and warrants were quoted on the Nasdaq SmallCap Market
since our initial public offering on July 30, 1997, and are traded under the
symbols "VDAT" and "VDATW," respectively. Since August 5, 1999 our common stock
and warrants have been listed on the Nasdaq National Market. The following table
sets forth, for the periods from October 1, 1998 through August 5, 1999, the
high and low closing bid sale prices for our common stock and warrants as
reported on the Nasdaq SmallCap Market and for the period from August 6, 1999
through September 30, 2000, the high and low closing bid sale prices for our
common stock and warrants as reported on the Nasdaq National Market System.

<TABLE>
<CAPTION>
COMMON STOCK                                  HIGH               LOW
-------------                               --------          --------
<S>                                         <C>               <C>
         FISCAL YEAR 1999:
         First Quarter                      $  6.875          $  2.125
         Second Quarter                     $ 16.375          $  6.563
         Third Quarter                      $ 40.000          $ 15.750
         Fourth Quarter                     $ 20.438          $  8.063

         FISCAL YEAR 2000:
         First Quarter                      $ 15.688          $  7.188
         Second Quarter                     $ 16.375          $  6.563
         Third Quarter                      $ 13.875          $  8.438
         Fourth Quarter                     $  9.250          $  3.031
</TABLE>


                                       12
<PAGE>   15

<TABLE>
<CAPTION>
WARRANTS                                      HIGH              LOW
--------                                    --------          --------
<S>                                         <C>               <C>
         FISCAL YEAR 1999:
         First Quarter                      $  2.750          $  0.313
         Second Quarter                     $ 10.250          $  2.500
         Third Quarter                      $ 35.000          $  9.625
         Fourth Quarter                     $ 14.500          $  4.250

         FISCAL YEAR 2000:
         First Quarter                      $ 10.125          $  3.500
         Second Quarter                     $  8.938          $  4.000
         Third Quarter                      $  4.250          $  1.313
         Fourth Quarter                     $  1.813          $  0.813
</TABLE>

         On December 15, 2000, the last reported sale prices of the common stock
and warrants on the Nasdaq National Market was $2.500 per share and $0.625 per
warrant. These prices do not include retail mark-ups, markdowns or commissions,
and may not necessarily represent actual transactions. As of December 15, 2000,
there were at least 430 shareholders of record of the common stock.

Recent Sales of Unregistered Securities


         On December 8, 2000 we sold an aggregate of $2,040,000 principal amount
of 6% Convertible Debentures to Halifax Fund, LP and Palladin Opportunity Fund,
LLC, two unaffiliated third parties, in a transaction exempt from registration
under the Securities Act in reliance on Section 4(2) and Regulation D. Halifax
Fund, LP and Palladin Opportunity Fund, LLC are affiliates as a result of common
control of the entities. Each of Halifax Fund, LP and Palladin Opportunity Fund,
LLC purchased the Convertible Debentures in the ordinary course of business, and
at the time of purchase neither Halifax Fund, LP or Palladin Opportunity Fund,
LLC had any agreement or understanding, directly or indirectly, with any person
to distribute either the convertible debentures or the shares of our common
stock into which they are convertible.



         The Convertible Debentures mature on December 8, 2003 and are
convertible, in whole or in part, at the option of the holders into shares of
our common stock at a conversion price equal to the lesser of:



         -  $2.13 per share, or



         -  90% of the average of the three lowest closing bid prices for the 20
            trading days prior to conversion (the "variable conversion price").



         The conversion price of the Convertible Debentures cannot be less than
$.90 per share provided that this floor price will be reset to 50% of the
variable conversion price on December 8, 2001. At our annual meeting of our
stockholders held on March 30, 2001, our stockholders approved the possible
issuance of common stock in excess of 19.99% of the presently issued and
outstanding common sock as required by Rule 4460(i)(1)(D) of The Nasdaq Stock
Market, Inc. Nasdaq Marketplace Rules. We have the right to redeem the
Convertible Debentures for 115% of the outstanding principal balance plus
accrued interest if the market price of our common stock is less than $1.50 per
share for 20 consecutive trading days, subject to the conditions set forth in
the Convertible Debentures.



                                       13
<PAGE>   16

         As a result of the business terms of the transaction negotiated by the
parties, the Convertible Debentures further provide that the number of shares of
common stock into which they are convertible, when added together with all other
shares of our common stock beneficially owned by the holder and its affiliates,
cannot exceed 9.9% of our total issued and outstanding common shares at any one
time. The debenture holders are affiliates, and the number of shares of common
stock owned by each debenture holder would be aggregated for the purposes of
calculating the 9.9% limitation. The terms of the debentures also have the
effect of restricting the amount of debentures which the debentures holders can
convert and sell within any 61 day period. This 9.9% limitation, however, does
not prevent the debenture holders from continually liquidating shares of our
common stock owned by them in order to convert all of the debentures into shares
of our common stock, subject to the terms of the debentures.



         In January 2001, the debenture holders converted $800,000 principal
amount of the debentures and $6,312 of accrued interest into an aggregate of
803,740 shares of our common stock based upon the then current conversion price
of $1.003 per share. These shares represented approximately 8.7% of the then
issued and outstanding common stock prior to the conversion, and approximately
8.0% of the outstanding common stock giving effect to the issuance.



         In conjunction with this transaction, we have issued the purchasers:



         -  one year warrants to purchase an aggregate of 500,000 shares of our
            common stock at an exercise price of $4.00 per share, and



         -  five year warrants to purchase an aggregate of 259,375 shares of our
            common stock at an exercise price of $2.053 per share.



         For a period of five days beginning on the effective date of
registration statement covering the shares of common stock issuable upon the
conversion of the Convertible Debentures and the exercise of the warrants, we
have the right to sell to the purchasers an additional $1,000,000 principal
amount of convertible debentures, with a conversion price identical to those
described above.



         Under the terms of the Purchase Agreement, we were obligated to prepare
and file a registration statement on Form S-3 registering the resale of the
shares of common stock underlying the Convertible Debentures and the warrants as
if these securities were converted or exercised on December 8, 2000. We filed
this registration statement on January 24, 2001. We also agreed to use our best
efforts to have the registration statement declared effective by 90 days from
the closing date (in the event the registration statement is not reviewed by the
SEC) or 150 days from the closing date (in the event such a review takes place).
If the registration statement is not declared effective by the applicable date,
we will incur a penalty of 2% per month in the form of a decreased conversion
price until the registration statement is effective; provided, however, that
this penalty will not exceed 16% if the purchasers are able to resell the common
stock under the provision of Rule 144 of the Securities Act.



         We also granted the purchasers certain rights of first refusal as they
relate to private equity or equity related transactions, and have agreed to
certain other limitations regarding the issuance of securities at prices less
than the conversion prices described above.


         In December 2000, TheFirstNews.Com ("TFN"), in a private offering, sold
Units to accredited investors under role 506, each Unit consisting of 10,000
shares of TFN common stock and 20,000 shares of TFN 10% redeemable, convertible
preferred stock. The purchase price for each unit was $50,000. TFN received net
proceeds of approximately $.8 million. TFN has the right to redeem each block of
20,000 shares of preferred stock included in each Unit, at any time from the
closing of the offering until


                                       14
<PAGE>   17
12 months thereafter, after providing the holder with 10 days notice, for
$50,000 per 20,000 shares of preferred stock plus accrued and unpaid interest.
In the event TFN fails to redeem the preferred stock within 12 months after the
closing of the offering, the preferred stock shall be automatically converted
into common stock at the conversion rate of 1 share of preferred stock for 1
share of common stock. In the event TFN fails to either file a registration
statement under the Securities Act of 1933, as amended, with the Securities and
Exchange Commission for the public offering of TFN's common stock within 12
months of the closing of the offering, or such registration statement has not
been declared effective within 6 months of its initial filing with the SEC, the
investors shall have the right to convert those shares of TFN common stock
received initially with the Units and those received upon conversion of the
preferred stock into shares of VDC common stock, at the conversion rate of one
share of TFN common stock for two shares of VDC common stock.

         Dividend Policy

         We have never declared or paid any cash dividends on our common stock.
We currently expect to retain future earnings, if any, to finance the growth and
development of our business.

Item 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

         The following discussion should be read together with the information
contained in the Consolidated Financial Statements and related Notes included
elsewhere in this annual report.

Overview

General

         Visual Data Corporation is a full service provider of streaming-content
applications, production technology and media solutions. Using advanced
technology and information solutions, we provide a sensory-rich experience to
businesses and consumers enabling them to make superior decisions.

         Visual Data is comprised of four operating groups including:

         Visual Data Travel Group (includes HotelView, ResortView, etc..)
         Visual Data On-line Broadcast and Production Group (includes
           Webcasting, Live audio and video events, etc..)
         Visual Data Networking Solutions Group (Ednet)
         Visual Data Financial Solutions Group (TheFirstNews.com)


                                       15
<PAGE>   18

Plan of Operation

         Our current plan of operation includes continuing to expand the
marketing of our video libraries, the development and marketing of our new
on-line products and services and to continue to look for synergistic
acquisition opportunities. The continued implementation of our plan of operation
may require us to raise additional working capital. In recent months, as a
result of the poor market performance of many Internet-based companies and the
resulting decline in market prices of these companies, the number of sources for
working capital for Internet-based companies such as ours have significantly
decreased. To date, despite these poor market conditions, we have not
experienced any significant difficulty in identifying working capital sources
and securing the capital as needed. Like many companies within in our industry,
however, in the future we may experience difficulties in raising additional
capital or our revenues may otherwise be adversely affected by the slowing
economy. We are unable at this time, however, to predict what effect any of
these possible future events may have on our plan of operation.


         The Visual Data Travel Group which includes HotelView, ResortView,
DestinationView, CruiseView, GolfersView and AttractionView will continue to
expand its offering through the development of additional vignettes as a result
of corporate agreements with companies such as Leading Hotels, Historic, Royal
Resorts, Radisson, Choice, Lexington, Worldres, Peninsula and Park Place. With
the growth of our Internet based distribution network through distribution
agreements with leading travel and leisure websites, management believes the
Company has created a value for the travel industry. We will continue to add to
the distribution relationships in order to increase the value of our travel
program. We have created a flexible pricing model that gives the hotel and
resort properties the choice of a pay-per-view or a fixed monthly service fee in
addition to an annual fee. It was initially necessary to target the individual
hotel and resort property sales while establishing brand identity, building a
diversified portfolio of properties (customers) and building the distribution
network. We have refocused our marketing target from the individual properties
to the corporate or chain level properties. This change in marketing focus
should enable us to reduce the costs of our sales and marketing program and
provide more substantial prospects. We believe we are in a position to build on
the infrastructure we have created.

         The Visual Data On-line Broadcast and Production Group ("OLBPG") was
created during the first quarter of fiscal 1999. OLBPG which includes our
partnership with PR Newswire for conference call webcasts and live audio and
video event webcasts, as well as our other business services including "about
the company" videos, visual trade shows and other multi-media presentations. By
combining the worldwide high speed data networks of Ednet, and our worldwide
network of camera crews, we are able to provide our clients with live audio and
video event broadcast capabilities via the Internet. During 2000 we added
additional encoders and other required facilities and staff to support the
growing demand for our webcasting services. In addition, we developed software
that would enable us to compete with companies offering specialized webcasting
services such as slide shows. We are now positioned to offer PR Newswire and
their clients full service webcasting capability. We will continue to remain
competitive, develop new features and expand our service offerings as this new
form of media continues to grow. OLBPG includes our MedicalView division that
creates and distributes Internet-based video programs for physicians, health
care professionals and consumers. Over 400 videos have been created and are
online and being syndicated to websites on the Internet. We will continue to
work with major sponsors to develop new and informative health content as well
as provide webcasting services to the health industry and derive new content
from these events.


                                       16
<PAGE>   19

         The Visual Data Networking Solutions Group (Ednet) was created in June
1998, when we acquired a 51% interest in Entertainment Digital Network, Inc.
(OTCBB: EDNT). Based in San Francisco, CA. Ednet develops and markets integrated
systems for the delivery, storage and management of professional quality digital
communications for media-based applications, including audio and video
production for the North American advertising and entertainment industries.
Ednet has established a private wide-area network (WAN) through strategic
alliances with long distance carriers, regional telephone companies, satellite
operators and independent fiber optic telecommunications providers, which
enables the exchange of high quality audio, compressed video and multimedia data
communications. Ednet provides engineering services, application-specific
technical advice, and audio, video and networking hardware and software as part
of its business.

         During 1999, Ednet teamed with Telestream, a manufacturer of high
quality video delivery systems, to provide Ednet customers the means to send
high quality video via the Internet and other Internet Protocol (IP) based WANS.
Under the terms of the agreement, Ednet provides complete turnkey solution,
bundling Telestream video equipment with their network services. It is
anticipated that this relationship will provide Ednet's entertainment and
advertising company clients the ability to cost effectively transmit their daily
shots of commercials, special effects, graphics, storyboards and animated shots,
thereby providing a more dependable and faster delivery system than was
previously available.

         For the past year our Ednet subsidiary has been focusing on developing
the webcasting services as well as developing the video network. During 2000, we
partnered with Digital Generation Systems to create the "One Digital Path", a
network service to enable production companies to deliver their productions
through a digital video network, through major television network's compliance
divisions, through the customer and approval process, right to the television
broadcasters. During the coming year we will focus on improving the audio
equipment sales and the audio network usage the core business of Ednet. We plan
to move the conference call portion of the webcasting business to Visual Data
(Florida), reduce the expenses of Ednet and apply the remaining resources to
growing the audio and video network business.

         The Visual Data Financial Solutions Group (theFirstNews.com) began
operations in November 1999 as TheFirstNews.com(TM) to address the information
needs of the financial community. This subsidiary provides aggregated,
up-to-the-minute, information for the financial community. The initial offering
was a streaming-audio presentation of the content over the Internet.
TheFirstNews.com is currently developing a wireless delivery to provide the same
service to customers through cell phones and PDA's. During 2000, we relaunched
the service through a network of affiliates that has now grown to over 75. In
the coming year we intend to launch our wireless service providing a means for
investors to get news alerts on their cellular phones, PDA's and


                                       17
<PAGE>   20

any other wireless device capable of receiving short messages or audio voice
mail. We intend to further develop our affiliates both on-line and wireless and
to find new uses of our content and audio feeds and begin syndicating this
unique content.

         In addition to the various initiatives described, we have re-evaluated
our operating costs and reduced costs that do not impact the Company's ability
to operate the business. These included a more stringent travel policy, the
reduction of several public relations and marketing firms and the elimination of
unnecessary remote offices. We have consolidated all marketing communications
through a single source. The Company also reduced costs associated with the
CareView division, which was sold to CuraSpan, Inc. See Note 12 in the
Consolidated Financial Statements.

Revenue Recognition

         Our HotelView, CareView and ResortView libraries recognize a portion of
their contract revenue at the time of completion of video production services
with the remaining revenue recognized over the term of the contracts. Per hit
charges are recognized when users watch a video on the Internet. Fixed monthly
fees are recognized on a monthly basis consistent with the terms of the
contracts. Commissions on ResortView bookings are recognized when the stays are
completed. Currently, our Video News Wire and MedicalView divisions recognize
revenue when a project is completed and our client is billed. A significant
component of Ednet's revenue relates to the sale of equipment, which is
recognized when the equipment is installed or upon signing of a contract after a
free trial period. Ednet recognizes revenues from equipment installation,
Webcasting and bridging when service is performed. Network usage revenue is
recognized based on the customers' monthly usage levels. Ednet leases some
equipment to customers under terms that are accounted for as operating leases.
Rental revenue from leases is recognized ratably over the life of the lease and
the related equipment is depreciated over its estimated useful life. All leases
of the related equipment contain fixed terms. TheFirstNews.com recognizes its
subscription revenue ratably as service is provided.

Provision for Doubtful Accounts and Inventory Obsolescence

         We have increased the provision for doubtful accounts and inventory
obsolescence as of September 30, 2000. The increase in the allowance for
doubtful accounts of approximately $240,000 was primarily the result of accounts
receivable from the CareView division which were significantly aged, as well as
one Ednet customer that had filed for bankruptcy. The increase in inventory
obsolescence was the result of a significant increase in inventory at Ednet. We
recorded an allowance for inventory obsolescence based on the estimated
realizable value of the inventory at September 30, 2000.


                                       18
<PAGE>   21

Results of Operations

         In the discussion below, we compare our results of operations for the
years ended September 30, 2000 and 1999. The discussion details the changes in
operations for Visual data Corporation and it's wholly-owned subsidiaries
("Visual") and Ednet.

         The following table shows for the periods presented the percentage of
revenue represented by items on our consolidated statements of operations.

<TABLE>
<CAPTION>
                                               PERCENTAGE OF REVENUE

                                              Year Ended September 30,
                                             --------------------------
                                               2000               1999
                                             -------            -------

<S>                                          <C>                <C>
Revenue                                        100.0%             100.0%

Cost of revenue                                119.7              110.4
                                             -------            -------
Operating expenses:
   General and administrative                  101.6              103.8

   Sales and marketing                          92.4               58.5
                                             -------            -------

Total operating expenses                       194.0              162.3
                                             -------            -------

Loss from operations                          (213.7)            (172.7)

Other income (expense):
   Interest income                               9.7                4.9

   Rental income                                 1.4                1.7

   Loss on disposal of assets                   (0.2)              (0.3)

   Interest expense                             (2.2)              (2.4)

   Minority interest                            10.8                8.7
                                             -------            -------

Net loss before taxes                         (194.2)            (160.1)

Income taxes                                      --                0.2
                                             -------            -------

Net loss                                      (194.2)%           (160.3)%
                                             =======            =======

Revenue
</TABLE>


                                       19
<PAGE>   22

Visual

         Revenue increased by approximately $992,000, or 137%, to approximately
$1,715,000 for the fiscal year ended September 30, 2000 from approximately
$723,000 for the fiscal year ended September 30, 1999. This increase was
primarily attributable to an increase in webcasts and live audio and video
events from the Visual Data On-line Broadcast and Production Group ("OLBPG").
Revenue from OLBPG increased by approximately $738,000, or 216%, to
approximately $1,079,000 for the fiscal year ended September 30, 2000 from
approximately $341,000 for the fiscal year ended September 30, 1999. In
addition, the Company experienced an increase in the Visual Data Travel Group
("Travel Group") as a result of increased production and distribution of hotel
vignettes. Revenue from Travel Group increased by approximately $148,000, or
64%, to approximately $380,000 for the fiscal year ended September 30, 2000 from
approximately $232,000 for the fiscal year ended September 30, 1999. Revenue
from the CareView division increased by approximately $120,000, or 93%, to
approximately $250,000 for the fiscal year ended September 30, 2000 from
approximately $130,000 for the fiscal year ended September 30, 1999. In December
2000, we sold the CareView name as well as the CareView library to CuraSpan,
Inc.

Ednet

         Revenue increased by approximately $413,000, or 11%, to approximately
$4,154,000 for the fiscal year ended September 30, 2000 from approximately
$3,741,000 for the fiscal year ended September 30, 1999. This increase was
primarily attributable to an increase in webcasts and video networking from the
Visual Data Networking Solutions Group ("Networking Group").

Cost of Revenue

Visual

         Cost of revenue increased by approximately $980,000, or 48%, to
approximately $3,008,000 for the fiscal year ended September 30, 2000 from
approximately $2,028,000 for the fiscal year ended September 30, 1999. Cost of
revenue as a percentage of revenue for the fiscal years ended September 30, 2000
and 1999 was approximately 175% and 281%, respectively, reflecting the impact of
an increase in revenues and additional cost of revenues to support current
revenues and future growth. The increase in cost of revenue was the result of an
increase in camera crews fees, information technology group salaries and
consultants and depreciation of assets


                                       20
<PAGE>   23

acquired to increase the capacity of operations.

Ednet

         Cost of revenue increased by approximately $1,118,000, or 39%, to
approximately $4,017,000 for the fiscal year ended September 30, 2000 from
approximately $2,899,000 for the fiscal year ended September 30, 1999. Cost of
revenue as a percentage of revenue for the fiscal years ended September 30, 2000
and 1999 was approximately 97% and 78%, respectively. The increase in cost of
revenue is the result of costs associated with "ClipMail" lines of business,
discounts to attract this business and the write down of slow moving "ClipMail"
inventory in an effort to more realistically assess its' value.

Operating Expenses

Visual

         General and administrative. General and administrative expense remained
relatively consistent at approximately $4,090,000 for the fiscal year ended
September 30, 2000 from approximately $4,085,000 for the fiscal year ended
September 30, 1999. General and administrative expense as a percentage of sales
was approximately 238% and 565% for the fiscal years ended September 30, 2000
and 1999, respectively. The significant decrease in general and administrative
expense as a percentage of sales is primarily attributable to a decrease of
approximately $120,000 for the SEC filing fees and a decrease of approximately
$625, 000 for consulting fees. This was off-set by an increase of approximately
$390,000 in administrative compensation, an increase of approximately $130,000
for depreciation and an increase of approximately $120,000 in telephone
expenses.

         Sales and marketing. Sales and marketing increased by approximately
$3,392,000, or approximately 250%, to approximately $4,750,000 for the fiscal
year ended September 30, 2000 from approximately $1,358,000 for the fiscal year
ended September 30, 1999. The increase in sales and marketing was primarily due
to an increase in compensation, travel and entertainment and advertising.
Compensation expense increased to approximately $1,565,000 during the fiscal
year ended September 30, 2000 from approximately $671,000 during the fiscal year
ended September 30, 1999. This increase was a result of the increase in sales
personnel during the year. The increase in travel and entertainment to
approximately $491,000 during the fiscal year ended September 30, 2000 from
approximately $231,000 during the fiscal year ended September 30, 1999 was a
result of the increase in sales personnel during the year. Advertising expenses
increased to approximately $1,263,000 during the fiscal year ended September 30,
2000 from approximately $521,000 during the fiscal year ended September 30, 1999
as a result of the Company

                                       21
<PAGE>   24

utilizing several marketing firms during the year. Subsequent to year-end, the
Company terminated the CareView employees, as a result of the sale to CuraSpan,
Inc. (see Note 12 to the Consolidated Financial Statements). In addition, the
Company has consolidated the advertising efforts for all of its divisions to
realize better economies, and, therefore, reduce advertising costs for Fiscal
Year Ended September 30, 2001.

Ednet

         General and administrative. General and administrative expense
increased approximately $623,000, or approximately 50%, to approximately
$1,877,000 for the fiscal year ended September 30, 2000 from approximately
$1,254,000 for the fiscal year ended September 30, 1999. General and
administrative expense as a percentage of sales was approximately 45% and 34%
for the fiscal years ended September 30, 2000 and 1999, respectively. The
increase in general and administrative expense as a percentage of sales is
primarily attributable to the expansion of the webcasting operations that
includes additional equipment depreciation and personnel.

         Sales and marketing. Sales and marketing increased by approximately
$119,000, or approximately 22%, to approximately $670,000 for the fiscal year
ended September 30, 2000 from approximately $551,000 for the fiscal year ended
September 30, 1999. The increase in sales and marketing was primarily due to an
increase in sales personnel.

Other Income (Expense)

Visual

         Other Income. Other income increased approximately $602,000, or
approximately 106%, to approximately $1,171,000 for the fiscal year ended
September 30, 2000 from approximately $569,000 for the fiscal year ended
September 30, 1999. The increase is primarily attributable to an increase in
interest income and an increase in minority interest. The increase in interest
income is the result of the increase in average cash balance for the fiscal year
ended September 30, 2000 compared with the fiscal year ended September 30, 1999.
The increase in minority interest is the result of the increase in the loss from
Ednet. As a result of the losses generated by Ednet, the minority interest
balance has been fully absorbed as of September 30, 2000, and, therefore, all
future losses will be fully absorbed by VDC. As the minority interest's 49%
share in Ednet's cumulative net losses through September 30, 2000 is in excess
of the minority interest's original investment by approximately $174,000, VDC
has reduced the minority interest liability to zero in the accompanying
consolidated balance sheet as of September 30, 2000. VDC will restore the
minority interest's 49% share in Ednet when and if the cumulative earnings in
Ednet become positive.


                                       22
<PAGE>   25

Ednet

         Other Expense. Other expense remained relatively consistent increasing
approximately $17,000, or approximately 170%, to approximately $27,000 for the
fiscal year ended September 30, 2000 from approximately $10,000 for the fiscal
year ended September 30, 1999.

Provision for Income Taxes

         We have incurred significant net losses since our inception in 1993.
These losses have resulted in net operating loss carryforwards and deferred tax
assets, which have been used by us to offset tax liabilities, which may have
been incurred in prior periods. We have recorded a valuation allowance against
the deferred income tax assets, since future utilization of these assets is
subject to our ability to generate taxable income.

Liquidity and Capital Resources

         Our working capital at September 30, 2000 was $3,820,000, a decrease of
approximately $12,215,000 from September 30, 1999. The change in working capital
was primarily attributable to cash used in operating activities. Net cash used
in operating activities increased to $10,466,000 for the fiscal year ended
September 30, 2000 from $5,353,000 for the fiscal year ended September 30, 1999.
This was the result of an increase in net loss of approximately $4,243,000,
changes in certain non-cash operating activities and changes in certain assets
and liabilities. Net cash used in investing activities increased to $1,167,000
for the fiscal year ended September 30, 2000 as compared to $470,000 for the
fiscal year ended September 30, 1999 primarily as a result of the sale of IBS in
fiscal year ended September 30, 1999, which resulted in cash from investing
activities of $887,000. Net cash used by financing activities for the fiscal
year ended September 30, 2000 was $483,000 compared to cash provided by
financing activities of $20,806,000 for the fiscal year ended September 30,
1999. This decrease was primarily attributable to the proceeds from the issuance
and exercise of common stock and warrants during the fiscal year ended September
30, 1999.

         For the year ended September 30, 2000, we had an operating loss of
approximately $12.5 million and cash used in operations of approximately $10.5
million. The Company's forecast for fiscal year 2001 anticipates a reduction in
cash used in operations. At September 30, 2000, we had $3.8 million of cash and
cash equivalents and restricted cash available to fund future operations.
Subsequent to the year ended September 30, 2000, we received net proceeds of
$2.6 million ($0.8 million for TheFirstNews.com). See Note 12 of the
Consolidated Financial Statements. We believe that the cash on hand plus funds
available related to the 6% Debenture financing discussed in Note 12 of the
Consolidated Financial Statements will be


                                       23
<PAGE>   26

sufficient to fund the Company's working capital, anticipated operating cash
flow deficit and capital expenditure requirements for at least the next 12
months.

         We evaluate our cash needs and existing burn rate on an regular basis.
We have instituted a plan which also reduces certain personnel and
administrative costs. We do not presently anticipate that we will make any
additional planned cost reductions. Based upon the ongoing evaluation of our
cash needs, we may seek to raise additional capital through the sale of equity
and debt securities as we may deem necessary. No assurances can be given that we
will be successful in obtaining additional capital, or that such capital will be
available on terms acceptable to us. Further, no assurances can be given that we
will achieve profitability or positive cash flow.

Recent Developments

Sale of CareView Assets

         In December 2000 pursuant to the terms and conditions of an Asset
Purchase Agreement by and between the Company, its wholly-owned subsidiary,
CareView and CuraSpan, Inc., Visual Data sold substantially all of the assets of
CareView to CuraSpan. CuraSpan, an Application Service Provider (ASP) that
develops technology-based solutions to meet the organizational, communication
and compliance needs of healthcare organizations, is an unaffiliated third party
and the terms of the transaction were the result of arms length negotiations by
the parties.

         Excluded from the assets sold were (i) CareView's cash on hand, (ii)
any claims for tax refunds for the periods prior to the closing date, (iii) all
notes and accounts receivables and other receivables of CareView, and (iv) any
amounts received by CareView in settlement of or relating to disputes or
litigation which relate to periods prior to the closing date. In connection with
the asset purchase, CuraSpan assumed all liabilities and obligations related to
CareView's business following the closing date, together with certain
contractual obligations as specified in the Asset Purchase Agreement.

         As consideration for the purchase, CuraSpan issued to Visual Data
182,000 shares of its Series B Preferred Stock and a promissory note in the
principal amount of $1,000,000. The note, which bears no interest, is payable
semi-annually commencing in May 2001, with each semi-annual payment equal to the
lesser of $125,000 or 50% of the renewal fees collected by Visual Data in the
previous six months from the post-acute facilities with which CuraSpan had a
contract as of the closing date; provided that the first and second payments to
be made thereunder shall not be less than $50,000 each, the third and fourth
payments to be made thereunder shall not be less than $75,000 each, and each
payment thereafter shall not be less than $100,000. Principal


                                       24
<PAGE>   27

payments not made within 10 days of the due date shall bear interest at 13% per
annum. Visual Data also agreed to provide CuraSpan with access of up to $30,000
during the 30 day period following the closing date under a revolving note
bearing interest at 6% per annum and due on the earlier of (i) six months from
the date of issuance or (ii) the closing date of an equity financing of CuraSpan
in an amount of not less than $1,000,000.

         As additional consideration for the asset purchase, Visual Data and
CuraSpan also entered into a Services Agreement wherein CuraSpan will purchase a
minimum of $250,000 of video services from Visual Data during the 12 month
period following the closing date.

SportSoft Golf, Inc. Merger with VDC Subsidiary

         In December 2000 VDC, and SportSoft Golf, Inc., a Delaware corporation
("SSG"), and certain shareholders of SSG entered into an Agreement and Plan of
Merger dated as of December 1, 2000 (the "Merger Agreement"), which provides,
among other things, that, upon the terms and subject to conditions thereof,
which includes the approval of SSG's stock holders', a wholly-owned subsidiary
of VDC ("Acquisition Sub") will be merged with and into SSG, with SSG being the
surviving corporation in the merger. In the merger, all outstanding shares of
common stock of SSG issued and outstanding shall be converted into the right to
receive .0969 shares of restricted common stock of VDC, par value $.0001. The
aggregate number of VDC shares to be received by the SSG shareholders will be
1,686,445.

         A Management Agreement (the "Management Agreement") between SSG and VDC
was entered into concurrently with the Merger Agreement which provides that SSG
retained the services of VDC to manage and oversee the business of SSG with
respect to its operations until the earlier to occur of (a) the effective date
of the Merger Agreement, or (b) the termination of the Merger Agreement. VDC
will act as manager and shall assume complete and absolute managerial day-to-day
control over SSG. VDC shall receive as compensation all of the consolidated
income of SSG and it subsidiaries, subject to certain provisions in the
Management Agreement.

Risk Factors

WE HAVE AN ACCUMULATED DEFICIT AND ANTICIPATE CONTINUING LOSSES

         Visual Data continues to incur operating losses. For the years ended
September 30, 2000 and 1999, we incurred losses of $11,401,583 and $7,158,376,
respectively and had an accumulated deficit at September 30, 2000 of
$28,170,584. Operating expenses have increased. Future profitability will depend
on substantial increases in revenues from operations. Future events, including
unanticipated expenses, increased


                                       25
<PAGE>   28

competition or inability to effectively integrate acquisitions, could have a
material adverse effect on operating margins and results of operations.
Accordingly, we may experience significant liquidity and cash flow problems if
the Company is not able to raise additional capital as needed. There can be no
assurance that future revenues will grow sufficiently to generate a positive
cash flow or otherwise enable Visual Data to be profitable.

WE CANNOT PREDICT OUR FUTURE REVENUES OR WHETHER OUR PRODUCTS WILL BE ACCEPTED

         Revenues from our information libraries and other products and services
have been limited (approximately $5,868,435 and $4,464,157 for the years ended
September 30, 2000 and 1999, respectively). In addition, the markets for our
information libraries and other products and services have only recently begun
to develop, are rapidly evolving and are increasingly competitive. Demand and
market acceptance for recently introduced products and services are subject to a
high level of uncertainty and risk. It is difficult to predict whether, or how
fast, these markets will grow. We cannot guarantee either that the demand for
our information libraries and other products and services will continue to
develop or that such demand will be sustainable. If the market develops more
slowly than expected or becomes saturated with our competitors' products and
services, or do not sustain market acceptance, our business, operating results,
and financial condition will be materially and adversely affected.

WE ARE DEPENDENT ON CONTRACTS, SOME OF WHICH ARE SHORT TERM

         We are dependent upon contracts with our strategic partners and clients
including Interval International, Inc., InterVu, Inc. and PR Newswire
Corporation. These contracts are generally for terms ranging from one to two
years; however, many of them permit our clients and partners to terminate their
agreements with us on short term notice. The termination of certain of these
contracts could have a material adverse effect on our business operations and
prospects.

WE DEPEND ON MANAGEMENT TO INTEGRATE OUR ACQUISITIONS AND TO MANAGE OUR GROWTH

         Our business strategy includes growth through acquisition and internal
development. We are subject to various risks associated with our growth
strategy, including the risk that we will be unable to identify and recruit
suitable acquisition candidates in the future or to integrate and manage the
acquired companies.

         We completed the acquisition of 51% of Ednet and are in the continuing
process of integrating these operations. We recently announced an agreement to
acquire SportSoft Golf, Inc. Acquired companies' history, geographical location,
business


                                       26
<PAGE>   29

model and business culture is different from ours in many respects. Our
directors and senior management face a significant challenge in their efforts to
integrate our businesses and the business of acquired companies or assets, and
to effectively manage our continued growth. There can be no assurance that our
efforts to integrate the operations of these companies and the acquired assets
will be successful, that we can manage our growth or that the anticipated
benefits of the acquisitions or their assets will be fully realized. The
dedication of management resources to such efforts may detract attention from
our day-to-day business. There can be no assurance that there will not be
substantial costs associated with such activities or of the success of our
integration efforts, either of which could have a material adverse effect on our
operating results.

WE MAY NEED ADDITIONAL FINANCING

         We believe that our cash on hand, plus funds available relating to the
6% Debenture financing described in Note 12 to the Consolidated Financial
Statements, plus our banking arrangements will be sufficient to fund our working
capital, anticipated operating cash flow deficit and capital expenditure
requirements for at least the next 12 months. Our future capital requirements,
however, depend on a number of factors, including our ability to grow our
revenues and manage our business.

         Accordingly, we may need to raise additional funds in order to grow our
business and pursue new expansion opportunities. Our business could suffer if we
are unable to raise such additional funds on acceptable terms, or at all.

WE MAY NOT BE ABLE TO OBTAIN ADDITIONAL CAPITAL ON ACCEPTABLE TERMS

         Our acquisition and internal growth strategy requires substantial
capital investment. Capital is typically needed not only for the acquisition of
additional companies, but also for the effective integration, operation and
expansion of these businesses. Capital is also necessary for the production and
marketing of additional on-line multi-media libraries, products and services.
Therefore, our growth may depend upon our ability to raise additional capital,
possibly through the issuance of long-term or short-term indebtedness or the
issuance of our equity securities in private or public transactions. This will
likely result in dilution of existing equity positions or increased interest
expense. There can be no assurance that acceptable financing for future
acquisitions or for the integration and expansion of existing operations can be
obtained on suitable terms, if at all.

         If we raise additional funds through the issuance of equity or
convertible debt securities, the percentage ownership of Visual Data held by
existing shareholders will be reduced and those shareholders may experience
significant additional dilution. In


                                       27
<PAGE>   30

addition, new securities may contain certain rights, preferences or privileges
that are senior to those of our common stock.

THE EXERCISE OF OPTIONS AND WARRANTS WILL HAVE DILUTIVE EFFECT

         As of September 30, 2000, we had outstanding options and warrants to
purchase a total of 7,728,715 shares of our common stock at prices ranging
between $.00016 and $17.188 per share, including 4,966,385 options issued to
directors, executive officers and employees. The existence of such options and
warrants may adversely affect the terms under which we could obtain additional
equity capital. The exercise of these warrants and options may materially
adversely affect the market price of our common stock.

WE EXPECT TO EXPERIENCE VOLATILITY AND FLUCTUATIONS IN OUR STOCK PRICES

         Historically, there has been and there may continue to be volatility in
the market price for our common stock. Our quarterly operating results, changes
in general conditions in the economy, the financial markets or the marketing
industry, or other developments affecting us or our competitors, could cause the
market price of our common stock to fluctuate substantially. In addition, the
stock market in general and the market prices for Internet-related companies in
particular, have experienced extreme volatility that often has been unrelated to
the operating performance of such companies. These broad market and industry
fluctuations may adversely affect the price of our common stock, regardless of
our operating performance.

         We expect to experience significant fluctuations in our future
quarterly operating results due to a variety of factors, many of which are
outside our control. Factors that may adversely affect our quarterly operating
results include:

         -        the announcement or introduction of new services and products
                  by us and our competitors;

         -        our ability to upgrade and develop our systems in a timely and
                  effective manner;

         -        our ability to retain existing clients and attract new clients
                  at a steady rate, and maintain client satisfaction;

         -        the level of use of the Internet and online services and the
                  rate of market acceptance of the Internet and other online
                  services for transacting business;


                                       28
<PAGE>   31

         -        technical difficulties, system downtime, or Internet
                  brownouts;

         -        the amount and timing of operating costs and capital
                  expenditures relating to expansion of our business and
                  operations;

         -        government regulation; and

         -        general economic conditions and economic conditions specific
                  to the Internet and e-commerce.

         As a result of these factors, in one or more future quarters, our
operating results may fall below the expectations of securities analysts and
investors. In this event, the market price of our common stock would likely be
materially adversely affected.

Item 7.  FINANCIAL STATEMENTS

         Our financial statements are contained in pages F-1 through F-22 as
follows.

Item 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

         None.

                                    PART III

Item 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
         COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT

Management

Executive Officers and Directors

         Our executive officers and directors, and their ages are as follows:

<TABLE>
<CAPTION>
         Name                               Age                        Position
         ----                               ---                        --------
<S>                                         <C>               <C>
Randy S. Selman(1)                          44                Chief Executive Officer, President and
                                                              Chairman; Chairman of Ednet
Alan M. Saperstein                          41                Executive Vice President, Treasurer and
                                                              Director; Director of Ednet
George Stemper                              46                Chief Operating Officer
Gail Babitt                                 37                Chief Financial Officer
Benjamin Swirsky(1)(2)                      58                Director
Brian K. Service(1)(2)                      53                Director; Director of Ednet
Eric Jacobs                                 53                Secretary, Director; Director of Ednet
Robert J. Wussler(1)(2)                     61                Director
</TABLE>

---------------
(1)      Member of the Compensation Committee.
(2)      Member of the Audit Committee.


                                       29
<PAGE>   32

         Randy S. Selman. Since our inception in May 1993, Mr. Selman has served
as our Chief Executive Officer, President, and a director and from September
1996 through June 1999, as our Chief Financial Officer. Mr. Selman is also a
member of the Compensation Committee of the Board of Directors. Since July 1998
Mr. Selman has been Chairman of the Board of Ednet. From March 1985 through May
1993, Mr. Selman was Chairman of the Board, President and Chief Executive
Officer of SK Technologies Corporation (OTC Bulletin Board: SKTC), a
publicly-traded software development company. SKTC develops and markets software
for point-of-sale with complete back office functions such as inventory, sales
analysis and communications. Mr. Selman founded SKTC in 1985 and was involved in
their initial public offering in 1989. Mr. Selman's responsibilities included
management of SKTC, public and investor relations, finance, high level sales and
general overall administration.

         Alan M. Saperstein. Mr. Saperstein has served as our Executive Vice
President, Treasurer and a director since our inception in May 1993. Mr.
Saperstein also serves as an alternate member of the Compensation Committee of
the Board of Directors. Since July 1998, Mr. Saperstein has been a member of the
Board of Directors of Ednet. From March 1989 until May 1993, Mr. Saperstein was
a free-lance producer of video film projects. Mr. Saperstein has provided
consulting services for corporations that have set up their own sales and
training video departments. From 1983 through 1989, Mr. Saperstein was the
Executive Director/Entertainment Division of NFL Films where he was responsible
for supervision of all projects, budgets, screenings and staffing.

         George Stemper. Mr. Stemper has served as our Chief Operating Officer
since September 2000. Mr. Stemper comes to Visual Data with 25 years in the
computer, Internet application and hospitality technology fields. He served as a
Senior Vice President and General Manager with Hospitality Solutions
International (HSI) from June, 1997 through July, 2000. HSI is a leading global
developer and marketer of Windows NT and Internet based systems and applications
software for the restaurant, hotel, and club hospitality industry business
segments. From September, 1995 through June, 1997 Mr. Stemper served as the
Chief Operating Officer and as Executive Vice President for MCORP, an Edison, NJ
based software developer and product integrator having hotel technology,
telecom, military applications, and enterprise oriented business solutions. From
April, 1981 through September, 1995, Mr. Stemper was with


                                       30
<PAGE>   33

Control Transaction Corporation and served in key sales and marketing positions
and as the Executive Vice President. From July 1996 through August 1999, Mr.
Stemper was with the Hyatt Hotels Corporation and with Hilton Hotels from
August, 1979 through March 1981. Mr. Stemper has a B.S. degree from Cornell
University with and MBA from Fairleigh Dickinson University.

         Gail Babitt, CPA. Ms. Babitt joined VDC as Chief Financial Officer in
November 2000. From 1999 through October 2000 Ms. Babitt served as Vice
President of Finance, North America and Corporate Controller for TeleComputing
ASA. TeleComputing ASA is a leading application service provider. From 1997 to
1999 Ms. Babitt served as Manager-Transaction Services for Price Waterhouse
Coopers LLP. During 1997 Ms. Babitt served as Director of Finance for
ToppTelecom, Inc. Topp Telecom is a prepaid cellular company based in Miami.
From 1994 to 1997 Ms. Babitt worked in the audit group with Price Waterhouse
Coopers LLP (formerly Price Waterhouse LLP) and with Ernst & Young LLP from 1992
to 1994. Ms. Babitt has received a MBA from Boston University and a B.S. from
Nova Southeastern University.

         Benjamin Swirsky. Mr. Swirsky has been a member of the Board of
Directors since July 1997 and serves on the Audit and Compensation Committees of
the Board of Directors. Mr. Swirsky is the owner of Beswir Properties Inc., an
investment capital company. Since June 1998, Mr. Swirsky has been Chairman and
CEO of Zconnect, an e-commerce company, where he serves as Chairman. From June
1993 until January 1998, Mr. Swirsky was President and Chief Executive Officer
of Slater Steel, Inc., a publicly-traded company listed on the (Toronto Stock
Exchange: SSI) with investments in the steel, steel service, forging, pole-line
hardware and trucking industries. Mr. Swirsky was Chairman of P.C.Docs
International, Inc., a Canadian publicly-traded company (Nasdaq: DOCSF, TSE:
DXX) from 1997-1999. Mr. Swirsky is also a member of the Board of Directors of
the Four Seasons Hotel Corp., a chain of first class hotels located throughout
the world, and serves on the Audit, Compensation and Governance committees of
the Board. Mr. Swirsky also sits on the Board of Directors of a number of other
companies, including (i) CamVec Corp., a Canadian publicly-traded company
(CAT.CV), (ii) MigraTEC Inc., a publicly-traded company (Nasdaq: MIGR) where he
currently serves as Chairman, (iii) Commercial Alcohols, Inc., in which he is
also a principal shareholder, (iv) Bee Line Monorail Systems, Inc., (v)
Peregrine Industries, Inc. (OTC Bulletin Board: HVAC), (vi) Kaledon.com, Inc.,
where he currently serves as Chairman, and (vii) Don Bell Corporation.

         Brian K. Service. Mr. Service has been a member of our Board of
Directors since July 1997 and serves on the Audit and Compensation Committees of
the Board of Directors. Also, since August 1998 Mr. Service has been a Director
of Ednet. Mr. Service is a dual New Zealand and U.S. citizen and currently
resides in California. Mr. Service currently spends a substantial amount of his
professional time in the United States acting as an international business
consultant. In this capacity, he has clients in


                                       31
<PAGE>   34
North and South America, the United Kingdom, Asia, Australia and New Zealand.
From October 1992 to October 1994, Mr. Service was Chief Executive Officer and
Managing Director of Salmond Smith BioLab, a New Zealand publicly traded company
engaged in the production and sale of consumer and industrial products. From
1982 to 1986 he was Chief Executive Officer and Executive Chairman of Milk
Products, Holding (North America), Inc., a wholly-owned subsidiary of the New
Zealand Dairy Board that was located in Santa Rosa, California. Since September
1999, Mr. Service has served as - President, Chief Executive Officer and
director of 3D Systems, Inc., a publicly traded company.

         Eric Jacobs. Mr. Jacobs has been a member of the Board of Directors
since July 1997 and has served as Secretary since February 1999. From March 1996
until August 1997, Mr. Jacobs was Vice President and General Manager of our
wholly owned subsidiary, HotelView(R) Corporation and thereafter he has served
as Vice President and General Manager of our wholly owned subsidiary, ResortView
Corporation. Since October 1998, Mr. Jacobs has been a member of the Board of
Directors of Ednet. Since 1976, Mr. Jacobs has served as the Chairman of the
Miami Beach Visitor and Convention Authority and since September 1995 as
Chairman of the Greater Miami and the Beaches Hotel Association. Since 1972, Mr.
Jacobs has been a member of Miami Beach Chamber of Commerce and has served as
its Chairman since September 1996. From 1972 through October 1993, Mr. Jacobs
was the owner of, and served as President and General Manager of, the Tarleton
Hotel, Miami Beach, Florida.

         Robert J. Wussler. Mr. Wussler has been a member of the Board of
Directors since July 1999. Mr. Wussler has served as a Director of Ednet since
1995. Since June 1998 he has served as Chairman, Chief Executive Officer and
President of U.S. Digital Communications, Inc., a global satellite
communications firm that specializes in corporate applications. From June 1995
to May 1998, Mr. Wussler was President and Chief Executive Officer of Affiliate
Enterprises, Inc., the company formed by ABC Television affiliates to pursue new
business opportunities, including emerging technology applications. From 1989 to
1992, he was President and Chief Executive Officer of COMSAT Video Enterprises,
where he managed the acquisition of the NBA Denver Nuggets. Previously, from
1980 to 1990, he was Senior Vice President of Turner Broadcasting, where he
oversaw the launch of CNN, Headline News and TNT, in addition to serving as
President of SuperStation TBS, and from 1974 to 1978 he was the President of CBS
Television Network and CBS Sports.

         There is no family relationship between any of the executive officers
and directors. Each director is elected at our annual meeting of shareholders
and holds office until the next annual meeting of shareholders, or until his
successor is elected and qualified. At present, our bylaws provide for not less
than two directors. The bylaws permit the Board of Directors to fill any vacancy
and such director may serve until the next annual meeting of shareholders or
until his successor is elected and


                                       32
<PAGE>   35

qualified. The Board of Directors elects officers annually and their terms of
office are at the discretion of the Board. Our officers devote full time to our
business.

Meetings and Committees of the Board of Directors

         During our fiscal year ended September 30, 2000, our Board of Directors
held seven (7) meetings and took action one (1) additional time, by unanimous
written consent. Each member of the Board participated in each action of the
Board.

         Our Board of Directors has established a Compensation Committee and an
Audit Committee. The Compensation Committee administers our stock option plan
and makes recommendations to the Board of Directors concerning compensation,
including incentive arrangements, of our officers and key employees. The members
of the Compensation Committee are Randy S. Selman, Benjamin Swirsky, Brian K.
Service and Robert J. Wussler. During the year ended September 30, 2000, the
Compensation Committee did not hold any meetings. The Audit Committee reviews
the engagement of the independent accountants and reviews the independence of
the accounting firm. The Audit Committee also reviews the audit and non-audit
fees of the independent accountants and the adequacy of our internal accounting
controls. The members of the Audit Committee are Benjamin Swirsky, Brian K.
Service and Robert J. Wussler. During the year ended September 30, 2000, the
Audit Committee held two (2) meetings. The Compensation Committee and the Audit
Committee consist of a majority of independent directors.

Directors' Compensation

         Directors who are not our employees receive $1,000 per meeting as
compensation for serving on the Board of Directors, as well as reimbursement of
reasonable out-of-pocket expenses incurred in connection with their attendance
at Board of Directors' meetings. Members of the Compensation and Audit
Committees also receive compensation of $1,000 per committee meeting.

         In June and November 1998, we granted Mr. Service options to acquire
25,000 shares (each grant) of our common stock at an exercise price of $3.00 and
$2.125 per share. The term of these options is four years from the date of
grant. These options are fully vested and remain exercisable until the
expiration date thereof. These options were granted in connection with services
performed regarding the Ednet transaction.

         On November 19, 1998, we granted each of Messrs. Service and Swirsky
options to each acquire 35,000 shares of our common stock at an exercise price
of $16.00 per share. The term of these options is five years from the date of
grant. These options are fully vested and remain exercisable until the
expiration date thereof.


                                       33
<PAGE>   36
         On July 16, 1999, we granted Mr. Wussler options to acquire 75,000
shares of our common stock at an exercise price of $17.1875 per share. The term
of these options is three years from the date of vesting, with 25,000 vesting on
the first anniversary of the date of grant, 25,000 vesting on the second
anniversary of the date of grant and the remaining 25,000 vesting on the third
anniversary of the date of grant. In December 2000, the 25,000 vested shares
were cancelled.

         On November 1, 1999, we granted Mr. Jacobs options to acquire 30,000
shares of our common stock at an exercise price of $7.50 per share. The term of
these options is four years from the date of grant, with 10,000 vesting on the
first anniversary of the date of grant, 10,000 vesting on the second anniversary
of the date of grant and the remaining 10,000 vesting on the third anniversary
of the date of grant.

         In December 1999, the Board of Directors ratified the Compensation
Committee's recommendation that the option packages for the remaining two
independent directors, Mr. Swirsky and Mr. Service, be extended for a further
two years as from July 16, 1999 with an additional 50,000 options for each
director vesting equally over the final two years, and expiring on the same date
in 2004.

         On May 26, 2000, we granted Mr. Wussler options to acquire 25,000
shares of our common stock at an exercise price of $2.875 per share. The term of
these options is four years from the date of grant. The options are fully vested
and remain exercisable until the expiration date thereof.

Compliance With Section 16(a) of the Exchange Act

         Based solely upon a review of Forms 3 and 4 and amendments thereto
furnished to the Company under Rule 16a-3(d) of the Securities Exchange Act of
1934, as amended (the "Exchange Act") during the fiscal year ended September 30,
2000 and Forms 5 and amendments thereto furnished to the Company with respect to
the fiscal year ended September 30, 2000, as well as any written representation
from a reporting person that no Form 5 is required, the Company is not aware of
any person that failed to file on a timely basis, as disclosed in the
aforementioned Forms, reports required by Section 16(a) of the Exchange Act
during the fiscal year ended September 30, 2000.

Item 10. Executive Compensation

         The following table sets forth certain information relating to the
compensation of (i) our Chief Executive Officer; and (ii) each of our executive
officers who earned more than $100,000 during the fiscal year ended September
30, 2000 (collectively, the "Named Executive Officers"):


                                       34
<PAGE>   37


<TABLE>
<CAPTION>
                                      ANNUAL                             LONG-TERM
                                   COMPENSATION                     COMPENSATION AWARDS
      NAME AND           --------------------------------    ----------------------------------
PRINCIPAL POSITION
------------------                                           OTHER ANNUAL   RESTRICTED  OPTIONS
COMPENSATION             YEAR       SALARY          BONUS    COMPENSATION   STOCK AWDS  SARs(#)     LTIP   ALL OTHER
------------             ----      --------         -----    ------------   ----------  -------     ----   ---------
<S>                      <C>       <C>              <C>      <C>            <C>         <C>         <C>    <C>
Randy S. Selman          2000      $223,646(7)       -0-      $12,912(1)       -0-        -0-       -0-       -0-
  President, Chief       1999      $162,110          -0-      $ 9,794(2)       -0-        -0-       -0-       -0-
  Executive Officer
  and Director

Alan Saperstein          2000      $223,646(7)       -0-      $15,480(3)       -0-        -0-       -0-       -0-
  Vice President         1999      $162,110          -0-      $14,894(4)       -0-        -0-       -0-       -0-
  Treasurer and
  Director

Pauline Schneider        2000      $110,000          -0-      $ 1,775(5)       -0-        -0-       -0-       -0-
  Chief Financial        1999      $ 76,083          -0-      $22,874(6)       -0-        -0-       -0-       -0-
  Officer
</TABLE>

(1)      Includes $681 for disability insurance, $3,981 for medical insurance
         and $8,250 automobile allowance.
(2)      Includes $681 for disability insurance, $1,913 for medical insurance
         and $7,200 automobile allowance.
(3)      Includes $681 for disability insurance, $6,549 for medical insurance
         and $8,250 automobile allowance.
(4)      Includes $597 for disability insurance, $7,097 for medical insurance
         and $7,200 automobile allowance.
(5)      Includes $0 for disability insurance, $1,775 for medical insurance and
         $2,250 automobile allowance. Ms. Schneider served as the Chief
         Financial Officer until October 2000.
(6)      Includes $0 for disability insurance, $2,287 for medical insurance and
         $0 automobile allowance.
(7)      Includes a $25,000 management fee paid by Ednet.

Employment Agreements

         Effective January 9, 1998, we entered into amended and restated
employment agreements with Randy S. Selman, our Chief Executive Officer,
President and a director, and with Alan Saperstein, our Executive Vice
President, Treasurer and a director. The agreements with each of Messrs. Selman
and Saperstein are substantially similar and superseded in their entirety
previous employment agreements with each of Messrs. Selman and Saperstein. The
term of the agreement is for three years from the effective date of the
agreements and is renewable for successive one- year terms unless terminated.
The annual salary under each of the agreements is $137,500, which amount will be
increased by 10% each year. Messrs. Selman and Saperstein are also each eligible
to receive an annual bonus in cash or stock equal to 2% of our earnings before
income tax, depreciation and amortization (EBITDA) on that portion of EBITDA
that has increased over the previous year's EBITDA.

         Additionally, each of Messrs. Selman and Saperstein were granted
options (which contain certain anti-dilution provisions) to purchase 375,000
shares of common stock at $2.125 per share, vesting 125,000 options on each
anniversary date of the


                                       35
<PAGE>   38

effective date of each of the agreements. The options, which are exercisable for
a period of four years from the vesting date, automatically vest upon the
occurrence of certain events, including a change in control, constructive
termination (as defined in the agreements) of the employee, or the termination
of the employee other than for cause.

         The agreements were further amended, effective September 1, 1999, to
(i) extend the term an additional two years, until January 9, 2003 (ii) increase
the annual salary under each agreement to $195,000, and (iii) grant an
additional 250,000 options at $8.875 (the fair market value at the date of
grant) per share to each of Messrs. Selman and Saperstein, vesting 125,000
options on each anniversary date of the effective date of the additional two
year term provided for under the amendment to the amended and restated
employment agreements.

         The agreements also provide, among other things, for (i) participation
in any profit-sharing or retirement plan and in other employee benefits
applicable to our employees and executives, (ii) an automobile allowance and
fringe benefits commensurate with the duties and responsibilities of Messrs.
Selman and Saperstein, (iii) benefits in the event of disability and (iv)
contain certain non-disclosure and non- competition provisions. Additionally,
Messrs. Selman and Saperstein may be granted certain bonus incentives by our
Board of Directors. Furthermore, we have agreed to indemnify each of them for
any obligations or guaranties which either of them may have undertaken on our
behalf.

         Under the terms of the agreements, we may terminate the employment of
Mr. Selman or Mr. Saperstein either with or without cause. If the Agreements are
terminated by us without good cause, or by Mr. Selman or Mr. Saperstein with
good cause, as applicable, we would be obligated to pay that executive an amount
equal to three times that executive's current annual compensation (including
base salary and bonus), payable in bi-weekly installments (except in the case of
a termination upon a change in control wherein the executive may elect either a
lump sum payment, discounted to present market value or payment over a three
year period in bi-weekly installments). Additionally, the executive would be
entitled to participate in and accrue medical benefits for a period of two years
after the date of termination without cause (by us) or for good cause (by the
executive). To the extent that either Messrs. Selman or Saperstein are
terminated for cause, no severance benefits shall be paid.

Stock Option Information

         The following table sets forth certain information with respect to
stock options granted in fiscal 2000 to the Named Executive Officers.


                                       36
<PAGE>   39

                 OPTION GRANTS IN YEAR ENDED SEPTEMBER 30, 2000

<TABLE>
<CAPTION>
                                                         INDIVIDUAL GRANTS
                                                       --------------------
                                 NO. OF SECURITIES      % OF TOTAL OPTIONS
                                    UNDERLYING         GRANTED TO EMPLOYEES   EXERCISE        EXPIRATION
         NAME                     OPTIONS GRANTED         IN FISCAL YEAR       PRICE              DATE
         ----                    -----------------     --------------------   --------        ----------
<S>                              <C>                   <C>                    <C>             <C>
Randy S. Selman,
  President, Chief
  Executive Officer
  and Director                            --                     0%              --               --
Alan Saperstein, Vice
  President,
  Secretary and
  Director                                --                     0%              --               --
Pauline Schneider, Chief
  Financial Officer                   50,000(1)              10.32%              (1)              (1)
</TABLE>

(1)      On May 26, 2000 we granted options to acquire 50,000 shares of common
stock at an exercise price of $2.875 per share. These options were granted as
part of a five-year bonus program. The term of these options is four years from
the date of grant. These options are fully vested.

         The following table sets forth certain information regarding stock
options held as of September 30, 2000 by the Named Executive Officers.

               AGGREGATE OPTION EXERCISES IN YEAR ENDED SEPTEMBER 30, 2000
                                AND YEAR-END OPTION VALUES

<TABLE>
<CAPTION>
                                                              NO. OF SECURITIES
                                                           UNDERLYING UNEXERCISED                VALUE OF UNEXERCISED
                             SHARES                              OPTIONS AT                     IN-THE-MONEY OPTIONS AT
                            ACQUIRED                         SEPTEMBER 30, 2000                  SEPTEMBER 30, 2000(1)
                               ON         VALUE       --------------------------------       -----------------------------
 NAME                       EXERCISE     REALIZED     EXERCISABLE        UNEXERCISABLE       EXERCISABLE     UNEXERCISABLE
 ----                       --------     --------     -----------        -------------       -----------     -------------
<S>                         <C>          <C>          <C>                <C>                 <C>             <C>
Randy S. Selman,
  President, Chief
  Executive Officer
  and Director                 --         $ --         1,097,230(2)         375,000(2)         $802,215        $117,250
Alan Saperstein, Vice
  President, Treasurer
  and Director                 --         $ --         1,097,230(2)         375,000(2)         $802,215        $117,250
Pauline Schneider,
  Chief Financial
  Officer                      --         $ --           120,500(3)              --            $ 75,529        $     --
</TABLE>
----------------
(1)      The dollar value of the unexercised in-the-money options is calculated
         based upon the difference between the option exercise price and $3.063
         per share, being the closing price of our common stock on October 2,
         2000 as reported The Nasdaq National Market.
(2)      Of such exercisable options, at September 30, 2000, 32,230 options were
         exercisable at $.00016 per share, 750,000 options were exercisable at
         $2.125 per share and the remaining 315,000 were exercisable at $16.00.
         Of the unexercisable options, 125,000 have an exercise price of $2.125
         per share and 250,000 have an exercise price of $8.875 per share at
         September 30, 2000. See Option Grants in Year Ended September 30, 2000
         above.
(3)      Of such exercisable options, at September 30, 2000, 70,500 options were
         exercisable at $2.125 per share and the remaining 50,000 were
         exercisable at $2.875. See Option Grants in Year Ended


                                       37
<PAGE>   40

         September 30, 2000 above.

1996 Stock Option Plan

         On February 9, 1997, the Board of Directors and a majority of our
shareholders adopted our 1996 Stock Option Plan (the "Plan"). The purpose of the
Plan is to increase the employees', advisors', consultants' and non-employee
directors' proprietary interest in us and to align more closely their interests
with the interests of our shareholders. The purpose of the Plan is also to
enable us to attract and retain the services of experienced and highly qualified
employees and non-employee directors.

         Pursuant to an amendment to the Plan ratified by shareholders on July
16, 1999, we have reserved an aggregate of 2,500,000 shares of common stock for
issuance pursuant to options granted under the Plan ("Plan Options"). To date,
1,487,575 options have been granted under the Plan. Such options were issued to
our directors, employees and consultants at exercise prices ranging from $2.031
to $16.00 per share. The Board of Directors or a Committee of the Board of
Directors (the "Committee") will administer the Plan including, without
limitation, the selection of the persons who will be granted Plan Options under
the Plan, the type of Plan Options to be granted, the number of shares subject
to each Plan Option and the Plan Option price. As of this date, the Board of
Directors has not established a separate Committee.

         Plan Options granted under the Plan may either be options qualifying as
incentive stock options ("Incentive Options") under Section 422 of the Internal
Revenue Code of 1986, as amended (the "Code"), or options that do not so qualify
("Non- Qualified Options"). In addition, the Plan also allows for the inclusion
of a reload option provision ("Reload Option"), which permits an eligible person
to pay the exercise price of the Plan Option with shares of common stock owned
by the eligible person and to receive a new Plan Option to purchase shares of
common stock equal in number to the tendered shares. Any Incentive Option
granted under the Plan must provide for an exercise price of not less than 100%
of the fair market value of the underlying shares on the date of such grant, but
the exercise price of any Incentive Option granted to an eligible employee
owning more than 10% of our common stock must be at least 110% of such fair
market value as determined on the date of the grant.

         The term of each Plan Option and the manner in which it may be
exercised is determined by the Board of Directors or the Committee, provided
that no Plan Option may be exercisable more than 10 years after the date of its
grant and, in the case of an Incentive Option granted to an eligible employee
owning more than 10% of our common stock, no more than five years after the date
of the grant. In any case, the exercise price of any stock option granted under
the Plan will not be less than 85% of the fair market value of the common stock
on the date of grant. The exercise price of Non- Qualified Options shall be
determined by the Board of Directors or the Committee.

         The per share purchase price of shares subject to Plan Options granted
under the Plan may be adjusted in the event of certain changes in our
capitalization, but any


                                       38
<PAGE>   41

such adjustment shall not change the total purchase price payable upon the
exercise in full of Plan Options granted under the Plan. Officers, directors and
key employees of and consultants to us and our subsidiaries will be eligible to
receive Non-Qualified Options under the Plan. Only our officers, directors and
employees who are employed by us or by any of our subsidiaries thereof are
eligible to receive Incentive Options.

         All Plan Options are nonassignable and nontransferable, except by will
or by the laws of descent and distribution and, during the lifetime of the
optionee, may be exercised only by such optionee. If an optionee's employment is
terminated for any reason, other than his death or disability or termination for
cause, or if an optionee is not our employee but is a member of our Board of
Directors and his service as a Director is terminated for any reason, other than
death or disability, the Plan Option granted may be exercised on the earlier of
the expiration date or 30 days following the date of termination. If the
optionee dies during the term of his employment, the Plan Option granted to him
shall lapse to the extent unexercised on the earlier of the expiration date of
the Plan Option or the date one year following the date of the optionee's death.
If the optionee is permanently and totally disabled within the meaning of
Section 22(c)(3) of the Code, the Plan Option granted to him lapses to the
extent unexercised on the earlier of the expiration date of the option or one
year following the date of such disability.

         The Board of Directors or the Committee may amend, suspend or terminate
the Plan at any time, except that no amendment shall be made which (i) increases
the total number of shares subject to the Plan or changes the minimum purchase
price therefore (except in either case in the event of adjustments due to
changes in our capitalization), (ii) affects outstanding Plan Options or any
exercise right thereunder, (iii) extends the term of any Plan Option beyond ten
years, or (iv) extends the termination date of the Plan.

         Unless the Plan shall be earlier suspended or terminated by the Board
of Directors, the Plan shall terminate on approximately 10 years from the date
of the Plan's adoption. Any such termination of the Plan shall not affect the
validity of any Plan Options previously granted thereunder.

Item 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         The following table contains information regarding beneficial ownership
of our common stock as of December 15, 2000 held by (i) persons who own
beneficially more than 5% of our outstanding common stock, (ii) our directors,
(iii) named executive officers and (iv) all of our directors and officers as a
group. The table also represents the same information as adjusted to reflect the
sale of shares offered hereby.


                                       39
<PAGE>   42
<TABLE>
<CAPTION>
                                                   SHARES OF COMMON
                                                  STOCK BENEFICIALLY
                                                        OWNED (2)
NAME AND ADDRESS OF                          ----------------------------
OF BENEFICIAL OWNER(1)                        NUMBER           PERCENTAGE
----------------------                       ---------         ----------
<S>                                          <C>               <C>
Randy S. Selman(3)                           1,200,849            12.4%

Alan M. Saperstein(4)                        1,222,173            12.6%


George Stemper(5)                                   --              --

Gail Babitt(6)                                      --              --

Benjamin Swirsky(7)                            135,000             1.6%

Brian K. Service(8)                            185,000             2.1%

Eric Jacobs(9)                                 163,600             1.9%

Robert Wussler(10)                              25,000               *

Halifax Fund, LP(11)                         1,505,556            15.1%

Paladin Opportunity Fund, LLC(12)            1,461,111            14.7%

All Directors and
  Officers (8 persons)(13)                   2,931,622            25.7%

</TABLE>
-----------------
  *  Less than 1%

(1)      Unless otherwise indicated, the address of each of the listed
         beneficial owners identified is c/o Visual Data Corporation, 1291
         Southwest 29th Avenue, Pompano Beach, Florida 33069. Unless otherwise
         noted, we believe that all persons named in the table have sole voting
         and investment power with respect to all shares of our common stock
         beneficially owned by them.

(2)      A person is deemed to be the beneficial owner of securities that can be
         acquired by such a person within sixty days from the date of this
         annual report upon exercise of options, warrants or convertible
         securities. Each beneficial owner's percentage ownership is determined
         by assuming that options, warrants and convertible securities that are
         held by such a person (but not those held by any other person) and are
         exercisable within sixty days from the date hereof have been exercised.
         As of December 15, 2000 there were 8,453,358 shares of common stock
         outstanding.

(3)      This amount includes options to acquire an aggregate of 32,230 shares
         of common stock at an exercise price of $.00016 per share, options to
         acquire an aggregate of 750,000 shares of common stock at an exercise
         price of $2.125 per share, and options to purchase 315,000 shares of
         common stock at an exercise price of $16.00 per share. Excludes options
         to purchase 125,000 shares of common stock at an exercise price of
         $2.125 per share and options to purchase 250,000 shares of common stock
         at an exercise price of $8.875 per share, all of which have not yet
         vested.

(4)      This amount includes options to acquire an aggregate of 32,230 shares
         of common stock at an exercise price of $.00016 per share, options to
         acquire an aggregate of 750,000 shares of common stock at an exercise
         price of $2.125 per share, and options to purchase 315,000 shares of
         common stock at an exercise price of $16.00 per share. Excludes options
         to purchase 125,000 shares of common stock at an exercise price of
         $2.125 per share and options to purchase 250,000 shares of common stock
         at an exercise price of $8.875 per share, all of which have not yet
         vested.

(5)      This amount excludes options to purchase 100,000 shares at $4.188 per
         share, which was granted in September 2000, which have not yet vested.


                                       40
<PAGE>   43
(6)      This amount excludes options to purchase 75,000 shares at $2.031 per
         share, which was granted in October 2000, which have not yet vested.

(7)      This amount includes options to purchase 100,000 shares at $2.125 per
         share and 35,000 shares of common stock at an exercise price of $16.00
         which were granted in November 1998 and subsequently repriced in June
         1999, but excludes options to acquire 50,000 shares of common stock at
         an exercise price of $17.188 per share which were granted in November
         1999, which have not yet vested. Mr. Swirsky's address is 350 Fairlawn
         Avenue, Toronto, Ontario, Canada.

(8)      This amount includes options to purchase 125,000 shares at $2.125 per
         share, options to purchase an additional 25,000 shares at $3.00, and
         options to acquire 35,000 shares of common stock at an exercise price
         of $16.00, which were granted in November 1998 and subsequently
         repriced in June 1999. Excludes options to acquire an aggregate of
         50,000 shares of common stock at an exercise price of $7.50 per share,
         which were granted in November 1999, which have not yet vested. Mr.
         Service's address is 123 Red Hill Circle, Tiburon, CA 94920.

(9)      This amount includes options to acquire 75,000 shares of common stock
         at an exercise price of $2.125 per share which were granted in November
         1998 and includes options to purchase 25,000 shares of common stock at
         $7.50 which were granted in November 1999, but excludes options to
         acquire 50,000 shares of common stock at an exercise price of $7.50 per
         share which were granted in November 1999, which have not yet vested.

(10)     This amount includes options to acquire 25,000 shares of common stock
         at an exercise price of $2.875 per share, which were granted in May
         2000, but excludes options to acquire 75,000 shares of common stock at
         an exercise price of $17.188 per share, which were granted in July
         1999, of which, 25,000 were cancelled in December 2000. The remaining
         50,000 options have not yet vested.

(11)     Includes up to 1,115,556 shares of common stock issuable upon the
         conversion of $1,040,000 principal amount of convertible debentures
         presently outstanding, assuming a conversion at the floor price of $.90
         per share, up to 350,000 shares of common stock issuable upon the
         exercise of presently outstanding warrants, but excludes additional
         shares of common stock, including shares of common stock underlying
         warrants we will issue, if we exercise our right to sell Halifax Fund,
         LP additional convertible debentures. The floor conversion price of the
         debentures is subject to adjustment on December 8, 2001 to an amount
         equal to 90% of the average of the three lowest closing bid prices for
         the 20 trading days prior to that date. Accordingly, we are unable to
         predict at this time any adjustment in the floor conversion price on
         December 8, 2001, and as a result the potential full dilutive nature of
         the conversion formula, as it will be based upon an adjustment
         calculated on future market prices. If we were to assume the average
         market price of our common stock for the 20 trading days prior to
         December 8, 2001 was $1.903 (which represents the average market price
         for the 20 trading days prior to May 15, 2001), the variable
         conversion price at December 8, 2001 would be $1.71 and the resulting
         reset floor conversion price would be $.855 per share, which is 50% of
         the variable conversion price. The convertible debentures provide,
         however, that the number of shares of common stock into which they are
         convertible, when added together with all other shares of our common
         stock beneficially owned by the holder and its affiliates, cannot
         exceed 9.9% of our total issued and outstanding common shares at any
         one time. Halifax Fund, LP and Paladin Opportunity Fund LLC are
         affiliates. Halifax Fund, LP's address is c/o The Paladin Group, 195
         Maplewood Avenue, Maplewood, New Jersey 07040.

(12)     Includes up to 1,111,111 shares of common stock issuable upon the
         conversion of $1,000,000 principal amount of convertible debentures
         presently outstanding, assuming a conversion at the floor price of $.90
         per share, up to 350,000 shares of common stock issuable upon the
         exercise of presently outstanding warrants, but excludes additional
         shares of common stock, including shares of common stock underlying
         warrants we will issue, if we exercise our right to sell Paladin
         Opportunity Fund, LLC additional convertible debentures. The floor
         conversion price of the debentures is subject to adjustment on December
         8, 2001 to an amount equal to 90% of the average of the three lowest
         closing bid prices for the 20 trading days prior to that date.
         Accordingly, we are unable to predict at this time any adjustment in
         the floor conversion price on December 8, 2001, and as a result the
         potential full dilutive nature of the conversion formula, as it will be
         based upon an adjustment calculated on future market prices. If we
         were to assume the average market price of our common stock for the 20
         trading days prior to December 8, 2001 was $1.903 (which represents the
         average market price for the 20 trading days prior to May 15, 2001),
         the variable conversion price at December 8, 2001 would be $1.71 and
         the resulting reset floor conversion price would be $.855 per share,
         which is 50% of the variable conversion price. The convertible
         debentures provide, however, that the number of shares of common stock
         into which they are convertible, when added together with all other
         shares of our common stock beneficially owned by the holder and its
         affiliates, cannot exceed 9.9% of our total issued and outstanding
         common shares at any one time. Paladin Opportunity Fund, LLC and
         Halifax Fund, LP are affiliates. Paladin Opportunity Fund, LLC's
         address is c/o The Paladin Group, 195 Maplewood Avenue, Maplewood, New
         Jersey 07040.

(13)     See notes (3)-(10) above.

                                       41
<PAGE>   44

Item 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         In August 1998, Eric Jacobs, a director of both the Company and Ednet,
lent Ednet $200,000 under a one year unsecured promissory note bearing interest
at 12% per annum. Such funds were used by Ednet for general working capital. As
additional consideration for such loan, Mr. Jacobs received a warrant to
purchase 50,000 shares of Ednet's common stock at an exercise price of $.20 per
share. Such loan was repaid in full by Ednet on January 8, 1999.

         In May 1999, Eric Jacobs lent Ednet an additional $250,000 under a
90-day unsecured renewable promissory note bearing interest at 12% per annum.
Such funds were used by Ednet for the purchase of inventory. The note has been
renewed, $125,000 has been repaid, and, the remaining $125,000 is unpaid as of
the date of this filing which is due on December 31, 2001.

         The Company has adopted a corporate governance policy which requires
the approval of any transaction between the Company and any officer, director or
5% shareholder by a majority of the independent, disinterested directors. In
addition, pursuant to the inclusion of its securities on The Nasdaq National
Market, the Company is subject to compliance with certain corporate governance
standards adopted by The Nasdaq Stock Market, Inc.

                                     PART IV

Item 13. EXHIBITS AND REPORTS ON FORM 8-K

         The following documents are filed as a part of this report or are
incorporated by reference to previous filings, if so indicated:

         (a)      Exhibits

<TABLE>
<CAPTION>
EXHIBIT NO.          DESCRIPTION
-----------          -----------
<S>                  <C>
1(a)                 Form of Underwriting Agreement(11)
3(i)(a)              Articles of Incorporation(1)
3(i)(b)              Articles of Amendment dated July 26, 1993(1)
3(i)(c)              Articles of Amendment dated January 17, 1994(1)
3(i)(d)              Articles of Amendment dated October 11, 1994(1)
3(i)(e)              Articles of Amendment dated March 25, 1995(1)
3(i)(f)              Articles of Amendment dated October 31, 1995(1)
3(i)(g)              Articles of Amendment dated May 23, 1996(1)
3(i)(h)              Articles of Amendment dated May 5, 1998(2)
3(i)(i)              Articles of Amendment dated August 11, 1998(6)
3(i)(j)              Articles of Amendment dated June 13, 2000(11)
3(iii)               By-laws(1)
</TABLE>


                                       42
<PAGE>   45
<TABLE>
<S>                  <C>
4(c)                 Specimen Common Stock Certificate(1)
4(d)                 Specimen Common Stock Purchase Warrant (issued pursuant to
                     the Company's initial public offering on July 30, 1997)(1)
4(e)                 Form of Underwriter Warrant(10)
4(f)                 Form of Consulting Agreement(10)
4(g)                 Form of 6% Convertible Debenture in the principal amount of
                     $1,000,000 due December 8, 2003(12)
4(h)                 Form of 6% Convertible Debenture in the principal amount of
                     $1,000,000 due December 8, 2003(12)
4(i)                 Form of one year Common Stock Purchase Warrant(12)
4(j)                 Form of five year Common Stock Purchase Warrant(12)
10(a)                Agreement between HotelView Corporation and Pegasus Systems,
                     Inc. dated January 14, 1997(1)
10(b)                Form of Stock Option Plan and Amendment thereto(1)(14)
10(c)                Third Amended and Restated Employment Agreement between the
                     Company and Randy S. Selman(7)
10(d)                Third Amended and Restated Employment Agreement between the
                     Company and Alan Saperstein(7)
10(e)                Contract for Purchase and Sale of Real Property(3)
10(f)                Asset Purchase Agreement between the Company and Digital
                     Criteria Technologies, Inc.(4)
10(g)                Securities Purchase Agreement between the Company and Ednet,
                     Inc.(5)
10(h)                Option Agreement between the Company and Ednet, Inc.(5)
10(i)                Agreement dated March 9, 1998 by and between Interval
                     International, Inc. and CondoView Corporation(8)
10(j)                Agreement dated March 30, 1998 by and between Video News
                     Wire Corporation and P.R. Newswire, Inc.(8)
10(k)                Securities Purchase Agreement between the Company and
                     Cranshire Capital, L.P. and Gilford Partners, L.P.(9)
10(l)                Securities Purchase Agreement between the Company and Olive
                     Investors LLC(9)
10(m)                Purchase Agreement(12)
10(n)                Registration Rights Agreement(12)
10(o)                Asset Purchase Agreement **
10(p)                Promissory note in the principal amount of $1,000,000 between
                     CuraSpan, Inc. and Visual Data Corporation **
10(q)                Merger Agreement among the Company, SportSoft Golf, Inc. and
                     Certain Shareholders of SportSoft Golf, Inc.(13)
21                   Subsidiaries of the Company **
23.1                 Consent of Independent Certified Public Accountants *
</TABLE>

---------------
*      Filed herewith
**     Previously filed


                                       43
<PAGE>   46

(1)      Incorporated by reference to the exhibit of the same number filed with
         the Company's Registration Statement on Form SB-2, Registration No.
         333-18819, as amended and declared effective by the Commission on July
         30, 1997.
(2)      Incorporated by reference to the Company's Current Report on Form 8-K
         dated May 8, 1998.
(3)      Incorporated by reference to the Company's Annual Report on Form 10-KSB
         for the year ended September 30, 1997.
(4)      Incorporated by reference to the Company's Current Report on Form 8-K
         dated May 20, 1998.
(5)      Incorporated by reference to the Company's Current Report on Form 8-K
         dated August 11, 1998.
(6)      Incorporated by reference to the Company's Current Report on Form 8-K
         dated August 21, 1998.
(7)      Incorporated by reference to the exhibit of the same number filed with
         the Company's Registration Statement on Form S-3, Registration No.
         333-62071, as amended and declared effective by the Commission on
         November 3, 1998.
(8)      Incorporated by reference to the Company's Quarterly Report on Form
         10-QSB/A for the period ended June 30, 1998 as filed with the
         Commission on October 15, 1998.
(9)      Incorporated by reference to the Company's Quarterly Report on Form
         10-QSB for the period ended December 31, 1998 as filed with the
         Commission on February 17, 1999.
(10)     Incorporated by reference to the exhibit of the same number filed with
         the Company's Registration Statement on Form S-1, Registration No.
         333-79887.
(11)     Incorporated by reference to the Company's Quarterly Report on Form
         10-QSB for the period ended June 30, 2000 as filed with the Commission
         on August 14, 2000
(12)     Incorporated by reference to the Company's Current Report on Form 8-K
         dated December 18, 2000
(13)     Incorporated by reference to the Company's Current Report on Form 8-K
         dated January 3, 2001
(14)     Incorporated by reference to the Company's Proxy Statement for the year
         ended September 30, 1998

         (b)      Reports on Form 8-K

                  None.


                                       44
<PAGE>   47

                                   SIGNATURES

         Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, Visual Data Corporation has duly caused this Report on
Form 10-KSB/A to be signed on its behalf by the undersigned, thereunto duly
authorized.


                                       Visual Data Corporation



                                    By: /s/ Randy S. Selman
                                       ------------------------------------
                                       Randy S. Selman, President, Chief
                                                 Executive Officer



                                    By: /s/ Gail Babitt
                                       ------------------------------------
                                       Gail Babitt, Chief Financial Officer

         Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed by the following persons on behalf of the Registrant
and in the capacities and on the dates indicated.


<TABLE>
<CAPTION>
       Signature                          Title                        Date
       ---------                          -----                        ----
<S>                                <C>                            <C>


/s/ Randy S. Selman                Director, President,           May 22, 2001
----------------------------       Chief Executive Officer
Randy S. Selman



/s/ Gail Babitt                    Chief Financial Officer and    May 22, 2001
----------------------------       Principal Accounting Officer
Gail Babitt


/s/Alan Saperstein                 Director and Executive         May 22, 2001
----------------------------       Vice President
Alan Saperstein



----------------------------       Director                       May 22, 2001
Benjamin Swirsky



----------------------------       Director                       May 22, 2001
Brian K. Service



/s/ Eric Jacobs                    Director and Secretary         May 22, 2001
----------------------------
Eric Jacobs



/s/ Robert J. Wussler              Director                       May 22, 2001
----------------------------
Robert J. Wussler
</TABLE>


The foregoing represents a majority of the board of directors


                                       45