Exhibit 4.17.1


 


THIS WARRANT
AND THE SECURITIES ISSUABLE UPON ITS EXERCISE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER
ANY STATE SECURITIES LAWS, AND MAY NOT BE TRANSFERRED OR DISPOSED OF
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT
OR IN A TRANSACTION WHICH, IN THE OPINION OF COUNSEL SATISFACTORY TO THE COMPANY,
QUALIFIES AS AN EXEMPT TRANSACTION UNDER THE SECURITIES ACT, THE APPLICABLE
STATE SECURITIES LAW AND THE RULES AND REGULATIONS PROMULGATED THEREUNDER.


 


	
  No. C

  	
   

  	
   

  
	
  Issue Date: October 31, 2005

  	
   

  	
  Warrant to Purchase
  908,000

  
	
   

  	
   

  	
  Shares of Common Stock

  



 


WARRANT TO PURCHASE COMMON STOCK

OF

TRAFFIC.COM, INC.


 


This
is to certify that, FOR VALUE RECEIVED, The Burns Family Trust (“Holder”),
is entitled to purchase, subject to the terms set forth below, from Traffic.com, Inc.,
a Delaware corporation (the “Company”), during the period commencing on October 31,
2005 and ending at 5:00 P.M. (E.S.T.) on July 30, 2008 (the “Exercise
Period”), an aggregate of Nine Hundred and Eight Thousand (908,000) fully
paid and non-assessable shares of Company Common Stock, $0.01 par value per
share (the “Common Stock”), at a per share purchase price of $0.25 (the “Exercise
Price”). The Exercise Price and the number of such shares are subject to
adjustment, from time to time, as provided below.  The shares of Common Stock deliverable upon
such exercise are hereinafter sometimes referred to as the “Warrant Shares.”
 This Warrant is herein called the “Warrant.”


 


Section 1.                                            Exercise Period.  In
the event that the expiration of the Exercise Period shall fall on a Saturday,
Sunday or United States federally recognized holiday, the expiration of the
Exercise Period shall be extended to 5:00 P.M. (E.S.T.) on the first
business day following such Saturday, Sunday or recognized holiday.
Notwithstanding anything contained herein to the contrary, if any portion of
this Warrant remains unexercised as of the Expiration Date and the Market Price
of one share of Common Stock as of the Expiration Date is greater than the
Exercise Price as of the Expiration Date, then this Warrant shall be deemed to
have been exercised automatically, for the maximum number of shares then
purchasable hereunder, immediately prior to the close of business on the
Expiration Date (or, in the event that the Expiration Date is not a business
day, the immediately preceding business day) (the “Automatic Exercise Date”)
in the manner provided in Section 2 below, and the Holder (or such other
person or persons as directed by the Holder) shall be treated for all purposes
as the holder of record of such Warrant Shares as of the close of business on
such Automatic Exercise Date. This Warrant shall be deemed to be surrendered to
the Company on the Automatic Exercise Date by virtue of this Section 1
without any action by the Holder. As promptly as is reasonably practicable on
or after the Automatic Exercise Date, but in no event before the date on which
this Warrant is surrendered to the Company at the principal office of the
Company, or such other office or agency of the Company as it may reasonably
designate by written notice to the Holder, during normal business hours on any
business day, the Company at its expense shall issue and deliver to the Holder
(or such other person or persons as directed by the Holder) a certificate or
certificates for the number of Warrant Shares issuable upon such exercise, in
accordance with Section 2.


 





















 


Section 2.                                            Exercise of Warrant.


 


a.                                       Manner of Exercise.  This
Warrant may be exercised by the Holder, in whole or in part, at any time and
from time to time during the Exercise Period, by (i) the surrender of this
Warrant to the Company, with the Notice of Exercise attached hereto as Exhibit ”A”
(the “Notice of Exercise”) duly completed and executed on behalf of the
Holder, at the principal office of the Company or such other office or agency
of the Company as it may designate by notice in writing to the Holder (the “Principal
Office”), and (ii) the delivery of payment to the Company of the
Exercise Price for the number of Warrant Shares specified in the Notice of
Exercise in any manner specified in Section 2(c).


 


b.                                      Issuance of Warrant Shares.  Such
Warrant Shares shall be deemed to be issued to the Holder as the record holder
of such Warrant Shares as of the close of business on the date on which this
Warrant shall have been surrendered and payment shall have been made for the
Warrant Shares as aforesaid. As promptly as practicable thereafter, but in any
event within five (5) business days, the Company shall deliver to the
Holder a stock certificate(s) for the Warrant Shares specified in the Notice of
Exercise.  If this Warrant shall have
been exercised only in part, the Company shall, at the time of delivery of the
stock certificate(s), also deliver to the Holder, at the Company’s expense, a
new Warrant evidencing the right to purchase the remaining number of Warrant
Shares, which new Warrant shall in all other respects be identical to this
Warrant.


 


c.                                       Payment of Exercise Price. The Exercise Price shall be payable (i) in
cash or its equivalent, payable by wire transfer of immediately available funds
to a bank account specified by the Company or by certified or bank cashiers’
check in lawful money of the United States of America, (ii) by
surrendering to the Company the right to purchase a number of Warrant Shares
equal to the product obtained by multiplying the number of Warrant Shares to be
purchased (including the Warrant shares so surrendered) by a fraction, the numerator
of which is the Exercise Price and the denominator of which is the Market Price
(as defined below) of the Common Stock on the date of exercise of the Warrant,
or (iii) in any combination of (i) and (ii).


 


The
term “Market Price,” as used herein, shall mean, per share of Common
Stock on any given day, the closing price per share of the Common Stock on the
earlier of the day in question or, with respect to any issuance, payment or
distribution, the day immediately prior to the first day the Common Stock
trades regular way on the applicable securities exchange or in the applicable
securities market without the right to receive such issuance, payment or
distribution, where the closing price for each day shall be the reported last
sale price regular way or, in case no such reported sale takes place on such
day, the average of the reported closing bid and asked prices regular way, in
either case (I) on the New York Stock Exchange, or (II) if the Common
Stock is not listed or admitted to trading on such Exchange, on the principal
national securities exchange on which the Common Stock is listed or admitted to
trading, or (III) if the Common Stock is not listed or admitted to trading
on any national securities exchange, on the Nasdaq National Market System, or
(IV) if the Common Stock is not listed or admitted to trading on any
national securities exchange or quoted on the Nasdaq National Market System,
the average of the closing bid and asked prices in the over-the-counter market
as furnished by any New York Stock Exchange member firm reasonably selected
from time to time by the Board of Directors for such purpose; provided, however,
that in the event that none of (I) through (IV) is applicable to the Common
Stock, then the Market Price of the Common Stock shall be determined in good
faith by the Company’s Board of Directors.


 


d.                                      Fractional Shares. The Company shall not issue fractions of
Warrant Shares upon exercise of this Warrant or scrip in lieu thereof. If any
fraction of a Warrant Share would, except for the provisions of this Section 2(d),
be issuable upon exercise of this Warrant, the Company shall in lieu thereof
pay to the person entitled thereto an amount in cash equal to such fraction,
calculated to the


 


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nearest one-hundredth (1/00)
of a share, multiplied by the Market Price for the Common Stock, determined as
of the date of exercise.


 


Section 3.                                            Adjustment to Exercise Price and Warrant
Shares.  The Exercise Price in effect from time to time
and the number of Warrant Shares shall be subject to adjustment in certain
cases as set forth in this Section 3:


 


a.                                       Stock Split.  If, at any time after the date
hereof, the number of shares of the Company’s capital stock outstanding is
increased by a stock dividend or by a subdivision or split-up of shares, then,
following the record date for the determination of holders of capital stock
entitled to receive such stock dividend, subdivision or split-up, the Exercise
Price shall be appropriately decreased and the aggregate number of Warrant
Shares shall be increased in proportion to such increase in outstanding shares.
The foregoing provisions shall similarly apply to successive stock dividends,
subdivisions or split-ups.


 


b.                                      Reverse Stock-Split.  If,
at any time after the date hereof, the number of shares of capital stock
outstanding is decreased by a combination or reverse-split of the outstanding
shares, then, following the record date for such combination or reverse-split,
the Exercise Price shall be appropriately increased and the aggregate number of
Warrant Shares shall be decreased in proportion to such decrease in outstanding
shares. The foregoing provisions shall similarly apply to successive
combinations or reverse-splits.


 


c.                                       Issuance of Dividends.  In
the event that the Company shall make or issue to holders of Common Stock, or
shall fix a record date for the determination of holders of Common Stock
entitled to receive, any dividend or other distribution payable in equity
securities (other than shares of Common Stock), evidences of its indebtedness
or other property (other than a cash dividend that is payable solely out of
earnings or surplus legally available for dividends under applicable law),
then, in each such event and as a condition precedent to the taking of any such
action, lawful and adequate provision (in form and substance approved by the
Holder, which approval shall not be unreasonably withheld or delayed) shall be
made whereby the Holder shall thereafter have the right to receive, upon
exercise of this Warrant, in addition to the number of shares of Common Stock
receivable thereupon, the amount of such equity securities, evidences of
indebtedness or other property as the Holder would have received had the Holder
been the record owner, at the time the Company made or issued such dividend or
other distribution or on the record date fixed therefor, as the case may be, of
that number of shares of Common Stock receivable upon exercise of this Warrant
in full, and had the Holder thereafter, during the period from the date of such
event to and including the date(s) on which the Holder exercises this Warrant,
retained such equity securities, evidences of indebtedness or other property,
giving application to all other adjustments called for during such period under
this Section 3.


 


d.                                      Merger or Sale of Assets.  In
the event that the Company shall effect (i) any consolidation or merger of
the Company with or into any other person in which those holding more than 50%
of the voting power of the Company prior to the consolidation or merger no
longer hold more than 50% of the voting power of the surviving entity, or (ii) the
sale or other disposition of all or substantially all of the Company’s assets
to any other person, in such a way that the holders of Common Stock shall be
entitled to receive cash, securities, evidences of indebtedness or other
property with respect to or in exchange for their shares of Common Stock, then,
in each such event and as a condition precedent to the consummation thereof,
the Company or such other person as is formed by or survives such consolidation
or merger or acquires such assets, as the case may be, shall execute and
deliver to the Holder, without payment of any additional consideration
therefor, a new Warrant (in form and substance approved by the Holder, which
approval shall not be unreasonably withheld or delayed) providing that the
Holder shall have the right thereafter, during the period such Warrant shall
remain outstanding, to exercise such


 


3





















 


Warrant into the kind and
amount of cash, securities, evidences of indebtedness and other property as the
Holder would have received had the Holder been the record owner, at the time of
such consolidation, merger, sale or disposition, of that number of shares of
Common Stock issuable upon exercise of this Warrant in full immediately prior
to the consummation of such consolidation, merger, sale or disposition. If the
holders of the Common Stock may elect from choices the kind and/or amount of cash,
securities, evidences of indebtedness and other property receivable upon such
consolidation, merger, sale or disposition, then, for purposes of this Section 3(d),
the kind and amount of cash, securities, evidences of indebtedness and other
property receivable by the Holder upon exercise of such new Warrant shall be
specified by the Holder, which specification shall be made by the Holder by the
later of (I) ten (10) business days after the Holder is provided with
a final version of all material information concerning such choice as is
provided to the holders of Common Stock, or (II) the last time at which
the holders of Common Stock are permitted to make their specifications known to
the Company; provided, however, that if the Holder fails to make
any specification within such time period, the Holder’s choice shall be deemed
to be whatever choice is made by a plurality of the holders of Common Stock not
affiliated with the Company or, in the case of a consolidation, merger, sale or
disposition, the other parties thereto. Such new Warrant shall provide for
adjustments that, for events subsequent to the effective date of such new
Warrant, shall be as nearly equivalent as may be practicable to the adjustments
provided for in this Section 3. The foregoing provisions shall similarly
apply to successive consolidations, mergers or asset acquisitions.


 


e.                                       Notice of Adjustment.  In
each case of an adjustment or readjustment of the Exercise Price and number of
Warrant Shares pursuant to this Section 3, the Company shall, at its
expense, promptly furnish to the Holder a certificate prepared and signed by
the Treasurer or Chief Financial Officer of the Company, setting forth (i) such
adjustment or readjustment, (ii) the Exercise Price and number of Warrant
Shares in effect following such adjustment or readjustment (including the
amount, if any, of other securities and property that at the time would be
received upon the exercise of this Warrant), and (iii) the facts, set
forth in reasonable detail, upon which such adjustment or readjustment is
based.


 


Section 4.                                            No Dilution or Impairment.  The
Company shall not, by amendment to its certificate of incorporation or through
reorganization, consolidation, merger, dissolution, sale of assets or any other
voluntary action, avoid or seek to avoid the observance or performance of any
of the terms of this Warrant, but will at all times in good faith assist in the
carrying out of all such terms and in the taking of all such action as may be
necessary or appropriate in order to protect the rights of the Holder against
dilution or other impairment. Without limiting the generality of the foregoing,
the Company will not increase the par value of any shares of stock receivable
upon the exercise of this Warrant above the amount payable therefor upon such
exercise, and at all times will take all such action as may be necessary or
appropriate in order that the Company may validly and legally issue fully paid
and non-assessable stock upon the exercise of this Warrant.


 


Section 5.                                            Exchange and Replacement.


 


a.                                       Manner of Exchange and Replacement.  This
Warrant is exchangeable, upon surrender of the Warrant by the Holder to the
Company at the Principal Office, for new Warrants of like tenor registered in
the Holder’s name and representing in the aggregate the right to purchase the
same number of Warrant Shares purchasable hereunder, each of such new Warrants
to represent the right to purchase such number of Warrant Shares as shall be
designated by the Holder at the time of surrender.


 


b.                                      Issuance of New Warrant.  Upon
receipt by the Company of (i) evidence reasonably satisfactory to it of
the loss, theft, destruction or mutilation of this Warrant, and (ii) (A) in
the case of loss, theft or destruction, an indemnity agreement reasonably
satisfactory in form and substance to


 


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the Company or (B) in
the case of mutilation, this Warrant, the Company, at its expense, shall
execute and deliver, in lieu of this Warrant, a new Warrant of like tenor and
amount.


 


Section 6.                                            Representations and Warranties of the Company.  The
Company represents and warrants to the Holder that all shares of Common Stock
which may be issued upon the exercise of this Warrant will, upon issuance in
accordance with the terms of this Warrant, be validly issued, fully paid and
non-assessable.


 


Section 7.                                            Covenants of the Company.  The
Company covenants and agrees that it shall take all such action as may be
required to assure that the Company shall at all times have authorized and
reserved, a sufficient number of shares of its Common Stock to provide for the
exercise of this warrant and/or other similar Warrants.


 


Section 8.                                            No Stockholder Rights.  The
Holder shall not be entitled to vote or receive dividends or be deemed the
holder of the Warrant Shares or any other securities of the Company that may at
any time be issuable upon the exercise hereof for any purpose, nor shall
anything contained herein be construed to confer upon the Holder, as such, any
of the rights of a stockholder of the Company or any right to vote for the
election of directors or upon any other matter submitted to the stockholders of
the Company at any meeting thereof, or to give or withhold consent to any
corporate action (whether upon any recapitalization, issuance or
reclassification of capital stock, change of par value, or change of stock to
no par value, consolidation, merger, conveyance or otherwise) or to receive
notice of meetings, or to receive dividends or subscription rights or
otherwise, until the Warrant shall have been exercised as provided herein.


 


Section 9.                                            Restrictions on Transfer.  This
Warrant may not be transferred or assigned to any person without the prior
written consent of the Company.


 


Section 10.                                      Notice.  All notices or other
communications which are required or permitted hereunder shall be in writing
and sufficient if delivered personally or sent by registered mail, postage
prepaid, return receipt requested, or via facsimile, addressed as follows:


 


(i)       If to the Company, to:


 


Traffic.com, Inc. 

851 Duportail Road

Wayne, PA  19087 

Attn: Chief Executive Officer


 


with a copy to:


 


Covington & Burling


1330 Avenue of the Americas

New York, NY  10019

Telephone:     (212) 841-1000

Facsimile:       (646) 441-1010 

Attn: Ellen B. Corenswet, Esq.


 


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(ii)  If to the Holder,
to:


 


The Burns Family Trust.

9 Whitehorse Meadows

Malvern, PA 19355


 


or to such other address
as the party to whom notice is to be given may have furnished to the other
party in writing in accordance herewith.


 


a.                                       Governing Law. This Warrant shall be construed in
accordance with and governed by the laws of the State of Delaware (without
giving effect to any conflicts or choice of law provisions that would cause the
application of the domestic substantive laws of any other jurisdiction).


 


b.                                      Prevailing Party’s Costs and Expenses.  The
prevailing party in any mediation, arbitration or legal action to enforce or
interpret this Warrant shall be entitled to recover from the non-prevailing
party all costs and expenses, including reasonable and documented attorneys’
fees, incurred in such action or proceeding.


 


c.                                       Failure to Pursue Remedies.  Except
where a time period is specified, no delay on the part of any party in the
exercise of any right, power, privilege or remedy hereunder shall operate as a
waiver thereof, nor shall any exercise or partial exercise of any such right,
power, privilege or remedy preclude any further exercise thereof or the
exercise of any other right, power, privilege or remedy.


 


d.                                      Amendment and Waiver.  No
provision of this Warrant may be amended, modified or waived except upon the
written consent of the party against whom such amendment, modification or
waiver is to be enforced. The failure of any party to enforce any of the
provisions of this Warrant shall in no way be construed as a waiver of such
provisions and shall not affect the right of such party thereafter to enforce
each and every provision of this Warrant in accordance with its terms.


 


e.                                       Assignment; Binding Effect.  The
rights and obligations of the Company set forth herein may not be assigned or
delegated by the Company without the prior written consent of the Holder.
Subject to compliance with the provisions of Section 9 hereof, the rights
and obligations of the Holder set forth herein may be assigned or delegated by
the Holder without the prior written consent of the Company. This Warrant shall
be binding upon and inure to the benefit of all of the parties and, to the
extent permitted by this Warrant, their successors, legal representatives and assigns.


 


f.                                         Severability.  If
any term or provision of this Warrant, or the application thereof to any person
or circumstance, shall, to any extent, be invalid or unenforceable, the
remainder of this Warrant, or its application to other persons or
circumstances, shall not be affected thereby, and each term and provision of
this Warrant shall be enforced to the fullest extent permitted by law.


 


g.                                      Construction.  Whenever
the context requires, the gender of any word used in this Warrant includes the
masculine, feminine or neuter, and the number of any word includes the singular
or plural. Unless the context otherwise requires, all references to articles
and sections refer to articles and sections of this Warrant, and all references
to exhibits are to exhibits attached hereto, each of which is made a part
hereof for all purposes.


 


h.                                      Headings.  The headings and subheadings
in this Warrant are included for convenience and identification only and are in
no way intended to describe, interpret, define or limit the scope, extent or
intent of this Warrant or any provision hereof.


 


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i.                                          Facsimile.  Delivery of an executed
signature page of this Warrant by facsimile transmission shall be as
effective as delivery of a manually executed signature page.


 


[SIGNATURES ON THE FOLLOWING
PAGE]


 


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IN
WITNESS WHEREOF, the Company has caused this Warrant to be executed by its duly
authorized officer as of the date first written above.


 


	
   

  	
  TRAFFIC.COM, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Robert N. Verratti

  
	
   

  	
   

  	
  Title:

  	
  Chief Executive Officer

  
					



 


 


	
  Attest:

  
	
   

  
	
   

  
	
   

  	
   

  
	
  Name:

  
	
  Title:

  



 


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EXHIBIT ”A”


 


NOTICE OF EXERCISE


 


To:                              Traffic.com, Inc.


 


1.               The undersigned hereby elects to purchase                          
shares of Common Stock of Traffic.com, Inc., pursuant to the terms of the
attached Warrant, and tenders herewith payment of the Exercise Price for such
shares in full in the following manner:


 


•                                          The undersigned elects to exercise the
attached Warrant by means of a cash payment, and tenders herewith payment in
full for the Exercise Price of the shares being purchased, together with all
applicable transfer taxes, if any.


 


•                                          The undersigned elects to exercise the
attached Warrant by means of the surrender of the right to purchase a number of
shares of Common Stock in accordance with the provisions of Section 2(c)(ii) of
the Warrant, and also tenders herewith a cash payment in the amount of all
applicable transfer taxes, if any.


 


•                                          The undersigned elects to exercise the
attached Warrant by means of both a cash payment and the surrender of the right
to purchase a number of shares of Common Stock in accordance with the provisions
of Section 2(c)(ii) of the Warrant, and tenders herewith payment in
full for that portion of the purchase price being paid in cash, together with
all applicable transfer taxes, if any.


 


2.               In exercising this Warrant, the undersigned
hereby confirms and acknowledges that the shares of Common Stock to be issued
upon exercise are being acquired solely for the account of the undersigned and
not as a nominee for any other party, or for investment, and that the
undersigned will not offer, sell or otherwise dispose of any such shares of
Common Stock except under circumstances that will not result in a violation of
the registration provisions of the Securities Act of 1933, as amended, or any
applicable state securities laws.


 


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


 


	
   

  	
  Name:

  	
   

  	
   

  



 


4.               Please issue a new Warrant for the
unexercised portion of the attached Warrant in the name of the undersigned or in
such other name as is specified below:


 


	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (Date)

  	
   

  	
  Signature of Holder