Exhibit 4.12
divine, inc.
NovaLink USA Corporation
(formerly Inner Circle Technologies, Inc.)
1994 Stock Option Plan
Incentive Stock Option Agreement
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Explanatory Note
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Pursuant to an Agreement and Plan of Merger, dated as of September 17, 2001,
Eprise Corporation (formerly known as Inner Circle Technologies, Inc.)
("Eprise") became a wholly owned subsidiary of divine, inc., a Delaware
Corporation ("divine"). divine assumed the outstanding options from the Inner
Circle Technologies, Inc. 1994 Stock Option Plan (the "Plan"). Each outstanding
option to purchase shares of Eprise common stock with an exercise price that,
when divided by 2.4233, was greater than $0.59, being the closing sale price of
divine class A common stock on the trading day immediately prior to the
effective time of the merger, became exercisable, at an exercise price of $0.59,
for a number of shares of divine class A common stock equal to the number of
shares of Eprise common stock subject to the Eprise option. Each outstanding
Eprise option with an exercise price that, when divided by 2.4233, was less than
or equal to $0.59, became exercisable, at an exercise price equal to the
exercise price of the Eprise option divided by 2.4233, for a number of shares of
divine class A common stock determined by multiplying the number of shares of
Eprise common stock subject to such Eprise option by 2.4233.
Other than as set forth in the paragraph above, the rights and obligations of
each holder of Eprise options granted pursuant to this agreement remain in full
force and effect
divine hereby grants this ____ day of __________ 2002, to ____________ (the
"Optionee"), an option to purchase a maximum of ________ shares of its class A
common stock, par value $0.001 per share (the "Common Stock"), at the price of
$_____ per share, on the following term and conditions:
1. Grant Under 1994 Stock Option Plan. This option is granted pursuant to and
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is governed by the Plan and, unless the context otherwise requires, terms used
herein shall have the same meaning as in the plan. Determinations made in
connection with this option pursuant to the Plan shall be governed by the Plan
as it exists on this date.
2. Grant of Incentive Option; Other Options. This option is intended to qualify
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as an incentive stock option under Section 422A of the Internal Revenue Code of
1986, as amended (the "Code"). This option is in addition to any other options
heretofore or hereafter granted to the Optionee by divine, but a duplicate
original of this instrument shall not effect the grant of another option.
3. Extent of Option if Business Relationship Continues. If the Optionee has
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continued to be employed by divine on the following dates, the Optionee may
exercise this option for the number of shares set opposite the applicable date:
Less than one year from the date hereof
One year but less than two years from the date hereof
Two years but less than three years from the date
hereof
Three years but less than four years from the date
hereof
Four years but less than five years from the date hereof
The foregoing rights are cumulative and, while the Optionee continues to be
employed by divine, may be exercised up to and including the date that is ten
years from the date this option is granted. All of the foregoing rights are
subject to Articles 4 and 5, as appropriate, if the Optionee ceases to be
employed by divine or dies or becomes disabled while in the employ of divine.
4. Termination of Business Relationship. If the Optionee ceases to be employed
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by divine, other than by reason of death or disability as defined in Article 5,
no further installments of this option shall become exercisable and this option
shall terminate after the passage of ninety (90) days from then date employment
ceases, but in no event later than the scheduled expiration date. In such a
case, the Optionee's only rights hereunder shall be those that are properly
exercised before the termination of this option
5. Death; Disability; Dissolution. If the Optionee dies while in the employ of
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divine, this option may be exercise, to the extent of the number of shares with
respect to which the Optionee could have exercised it on the date of his death,
by his estate, personal representative or beneficiary to whom this option has
been assigned pursuant to Article 10 at any time within 90 days after the date
of death, but not later than the scheduled expiration date. If the Optionee
ceases to be employed by divine by reason of his disability (as defined in the
Plan), this option may be exercised, to the extent of the number of shares with
respect to which the Optionee; could have exercised it on the date of the
termination of his employment, at any time within the 90 days after the date of
such termination but not later than the scheduled expiration date. At the
expiration of such ninety-day period or the scheduled expiration date, whichever
is the earlier, this option shall, terminate and the only rights hereunder shall
be those as to which the option was properly exercised before such termination.
6. Partial Exercise. Exercise of this option up to the extent above stated
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may be made in past at any rime and from time too time within the above limits,
except that this option may nor be exercised for a fraction of a share: unless
such exercise is with respect to the final installment of stock subject to this
option and a fractional share (or cash in lien thereof) must be issued to
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permit the Optionee to exercise completely such final installment. Any
fractional share with respect to which an installment of this option cannot be
exercised because of the limitation contained in the preceding sentence shall
remain subject to this option and shall be available for later purchase by the
Optionee in accordance with the terms hereof.
7. Payment of Price. (Person signing on behalf of divine must initial one of
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the three following clauses) The option price is payable in United States
dollars and may be paid:
(a) in each or by check, or any combination of the foregoing, equal in
amount to the option price; or
(Initials)
(b) in the discretion of the Board of Directors or Committee, in cash, by
check, by delivery of shares of divine's Common Stock having a fair
market value (as determined by the Board of Directors or Committee)
equal as of the date of exercise to the option price, or by any
combination of the foregoing, equal in amount to the option price: or
(Initials)
(c) in the discretion or the Board of Directors or Committee, in cash, by
check, by delivery of shares of divine's Common Stock having an
aggregate fair market value: (as determined by the Board of Directors
or Committee) equal as of the date of exercise to the option price,
by delivery of the Optionee's personal recourse note bearing interest
payable not less than annually at no less than 100% of the lowest
applicable Federal rate, as defined in Section 1274 (d) of the Code,
or by any combination of the foregoing, equal in amount to the option
price.
(Initials)
Notwithstanding the foregoing, the Optionee may not pay any part of the exercise
price hereof by transferring Common Stock to divine if such Common Stock is both
subject to a substantial risk of forfeiture: and not transferable within the
meaning of Section 83 of the Code:
8. Agreement to Purchase for Investment. By acceptance of this option, the
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Optionee agrees that a purchase of shares under this option will not be made
with a view to their distribution, as that term is used in the Securities Act of
1933, as amended, unless in the opinion of counsel to divine such distribution
is in compliance with or exempt from the registration and prospectus
requirements of that Act, and the Optionee agrees to sign a certificate to such
effect at the time of exercising this option and agrees that the certificate for
the shares so purchased may be inscribed with a legend to ensure compliance with
the Securities Act of 1933.
9. Method of Exercising Option. Subject to the terms and conditions of this
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Agreement, this option may be exercised by written notice to divine, at the
principal executive office of divine, or to such transfer agent as divine shall
designate. Such notice shall state the election to exercise this option and the
number of shares in respect of which it is being exercised and shall be signed
by the person or persons so exercising this option. Such notice shall be
accompanied by
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payment of the fall purchase price of such shares, and divine shall deliver a
certificate or certificates representing such shares as soon as practicable
after the notice shall be received. The certificate or certificates for the
shares as to which this option shall have been so exercised be registered in the
name of the person or persons so exercising this option (or, if this option
shall be exercised by the Optionee and if the Optionee shall so request in the
notice exercising this option, shall be registered in the name of the Optionee
and another person jointly, with right of survivorship) and shall be delivered
as provided above to or upon the written order of the person or persons
exercising this option. In the event this option shall be exercised, pursuant to
Article 5 hereof, by any person or persons other than the Optionee, such notice
shall be accompanied by appropriate proof of the right of such person or persons
to execute this option. All shares that shall be purchased upon the exercise of
this option at provided herein shall be fully paid and non-assessable.
10. Option not Transferable. This option is not transferable or assignable
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except by will or by the laws of descent and distribution. During the Optionee's
lifetime only the Optionee can exercise this option.
11. No obligation to Exercise Option. The grant and acceptance of this option
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imposes no obligation on the Optionee to exercise it.
12. No obligation to Continue Employment. divine and any Related Corporation
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(as defined in the Plan) are not by the Plan or this option obligated to
continue the Optionee in employment.
13. No Rights as Stockholder until Exercise. The Optionee shall have no rights
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as a stockholder with respect to shares subject to this Agreement until a stock
certificate therefor has been issued to the Optionee and is fully paid for,
except as is expressly provided in the Plan with respect to certain changes in
the capitalization of divine, no adjustment shall be made for dividends or
similar rights for which the record date is prior to the date such stock
certificate is issued.
14. Capital Changes and Business Successions. The Plan contains provisions
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coveting the treatment of options in a number of contingencies such as sock
splits and mergers. Provisions in the Plant for adjustment with respect to stock
subject to options and the related provisions with respect to successors to the
business of divine are hereby made applicable hereunder and are incorporated
herein by reference. In general, you should not assume that options necessarily
would survive the acquisition of divine. In particular, without acting the
generality of the foregoing, it is understood that for the purpose of Articles 3
through 5 hereof, both inclusive, employment by divine includes employment by a
Related Corporation as defined in the Plan.
15. Early Disposition. The Optionee agrees to notify divine in writing
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immediately after the Optionee makes a Disqualifying disposition of any Common
Stock received pursuant to the exercise of this option. A Disqualifying
Disposition is any disposition (including any sale) of such Common Stock before
the later of (a) two years after the date the Optionee was granted this option
or (b) one year after the date the Optionee acquired Common Stock by exercising
this option. If the Optionee has died before such stock is sold, these holding
period requirements do not apply and no Disqualifying Disposition can occur
thereafter. The Optionee also agrees to provide divine with any information that
it shall request concerning any such disposition. The
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Optionee acknowledges that he or she will forfeit the favorable income tax
treatment otherwise available with respect to the exercise of this incentive
stock option if he or she makes a Disqualifying Disposition of the stock
received on exercise of this option.
16. Withholding Taxes. If divine in its discretion determines that it is
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obligated to withhold tax with respect to a Disqualifying Disposition (as
defined in Article 15) of Common Stock received by the Optionee on exercise of
this option, the Optionee hereby agrees that divine may withhold from the
Optionee's wages the appropriate amount of federal, state and local withholding
taxes attributable to such Disqualifying Distribution. If any portion of this
option is treated as a Non-Qualified Option, the Optionee hereby agrees that
divine may withhold from the Optionees wages the appropriate amount of federal,
state and local withholding taxes attributable to the Optionee's exercise of
such Non-Qualified Option. At divine's discretion, the amount required to be
withhold may be withheld in cash from such wages, or (with respect to
Compensation income attributable to the exercise of this option) in kind from
the Common Stock otherwise deliverable to the Optionee on exercise of this
option. The Optionee further agrees that, if divine does not withhold an amount
from the Optionee's wages sufficient to satisfy divine's withholding obligation,
tire Optionee will reimburse divine an demand, in cash, for the amount
underwithheld.
17. xxxxxx's Right of First Refusal.
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(a) Exercise of Right: If the Optionee desires to sell all or any part of
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the shares acquired under this option including any securities
received in respect thereof pursuant to any stock dividend, stock
split, reclassification, reorganization, recapitalization and the
like), and an offeror (the "Offeror") has made an offer therefor,
which offer the Optionee desires to accept, the Optionee shall: (i)
obtain in writing an irrevocable and unconditional bona fide offer
(the "Bona Fide Offer") for the purchase thereof from the Offeror, and
(ii) give written notice (the "Option Notice") to divine setting forth
his desire to sell such shares, which Option Notice shall be
accompanied by a photocopy of the original executed Bone Fide Offer
and shall set forth at least f name and address of the Offeror and the
price and terms of the Bona Fide Offer: Upon receipt of the Option
Notice, divine shall have an assignable option to purchase any or all
of such shares (the "Option Shares") specified in the Option Notice,
such option to be exercisable by giving, within 30 days after receipt
of the Option Notice, a written counter-notice to the Optionee. If
divine elects to purchase any or all of such Option Shares, it shall
be obligated to purchase, and the Optionee shall be obligated to sell
to divine, such Option Shares at the price and terms indicated in the
Bona Fide Offer within 60 days from the date of receipt by divine of
the Option Notice.
(b) Sale of Option Shares to Offeror: The Optionee may sell, pursuant to
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the terms of the Bona Fide Offer, any or all of such Option Share not
purchased or agreed to be purchased by divine for 60 days after the
expiration of the 30-day period during which divine may give the
aforesaid counter-notice; provided, however, that the Optionee shall
not sell such Option Shares to the Offeror if the Offeror is a
competitor of divine and divine gives written notice to the Optionee,
within 30 days of its receipt of the Option Notice, stating that the
Optionee shall not sell his
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option Shares to the Offeror; and provided, further, that prior to the
sale of such Option Shares to the Offeror, the Offeror shall execute
an agreement with divine pursuant to which the Offeror agrees to be
subject to the restrictions set forth in this Article 17. If any or
all of such Option Shares ace not sold pursuant to a Bona Fide Offer
within the time permitted above, the unsold Option Shares shall remain
subject to the terms of this Article 17.
(c) Adjustment for Changes in Capital Structure: If there shall be any
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change in the Common Shock of divine through merger, consolidation,
reorganization, recapitalization, stock dividend, split-up,
combination or exchange of shams, or the like, the restrictions
contained in this Article 17 shall apply with equal force to
additional and/or substitute securities, if any, received by the
Optionee in exchange for, or by virtue of his or her ownership of
Option shares.
(d) Failure to Deliver Option Shares: In the event the Optionee fails or
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refuses to deliver on a timely basis duly endorsed certificates
representing Option Shares to be sold to divine pursuant to this
Article 17, divine shall have the right to deposit the purchase price
for the Option Shares in a special account with any bank or trust
company in the Commonwealth of Massachusetts giving notice of such
deposit to the Optionee, whereupon such Option Shares shall be deemed
to have bean purchased by divine. All such, monies shall be held by
the bank or that company for the benefit of the Optionee. All monies
deposited with the bank or trust company but remaining unclaimed for
two (2) years after the date of deposit shall be repaid by the bank or
the trust company to divine on demand, and the Optionee shall
thereafter look only to divine for payment. divine may place a legend
on any stock certificate delivered to the Optionee reflecting the
restrictions on transfer provided in this Article 17.
(e) Expiration of divine's Right of First Refusal: The refusal rights of
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divine set forth above shall remain in effect until the earlier of (i)
the date that is ten years from the date of grant of this option a
(ii) such time, if ever, as a distribution to the public is made of
shares of divine's Common Stock for an aggregate public offering price
of at least $5,000,000 or more pursuant to a registration statement
filed under the Securities Act of 1933, as amended, or successor
statute, at which time the refusal rights of divine set forth herein
will automatically expire.
18. No Exercise of Option if Business Relationship terminated for Misconduct.
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If the employment of the Optionee is terminated far "Misconduct," this option
shall terminate on the date of such termination of employment with respect to
any shares that have become exercisable during the period commencing on the date
that is six months prior to he date upon which such misconduct is determined by
the Board of Directors to have commenced or occurred and shall thereupon not be
exercisable to the extent of such termination. "Misconduct" is conduct, as
determined by the Board of Directors involving one or more of the following: (i)
the substantial and continuing failure of the Optionee to render services to
divine in accordance with his assigned duties; (ii) a determination by
two-thirds of the members of the Board of Directors that the Optionee his
inadequately performed the requirements of his employment; (iii) disloyalty,
gross negligence, dishonesty or breach of fiduciary duty to divine; (iv) the
commission of an act
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of embezzlement, fraud, disloyalty, dishonesty or deliberate disregard of the
rules or policies of divine that results in loss, damage or injury to divine,
whether directly or indirectly; (v) the unauthorized disclosure of any trade
secret or confidential information of the company; or (vi) the commission of an
act that constitutes unfair competition with divine or that induces any customer
of divine to break a contract with divine. In making such determination, the
Board of Directors shall act fairly and in utmost good faith and shall give the
Optionee an opportunity to appear and to be heard at a hearing before the Board
of Directors or any Committee and present evidence on his or her behalf: for the
purposes of this Article 18, termination of employment shall be deemed to occur
when the Optionee receives notice that his employment is terminated.
19. divine's Right of Repurchase.
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(a) Rights of Repurchase. If any of the events specified in Article 19
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(b) below occur, then;
(i) with respect to shares acquired upon exercise of this option
prior to the occurrence of such event, within 60 days after divine
receives actual knowledge of the event, and
(ii) with respect to shares acquired upon exercise of this option
after the occurrence of such event, within 60 days following the
later of the date of such exercise or the date divine receives
actual knowledge of such event,
(in either case, the "Repurchase Period"),divine shall have the option, but not
the obligation, to repurchase all, but not a portion of, the shares from the
Optionee, or his or her legal representatives, as the case may be (the
"Repurchase Option"). The Repurchase Option shall be exercised by divine by
giving the Optionee, or his or her legal representative, written notice of its
intention to exercise the Repurchase Option on or before the last day of the
Repurchase Period, and, together with such notice, tendering to the Optionee, or
legal representative, an amount equal to the higher of the option price or the
fair market value of the shares. divine may, in exercising the Repurchase
Option, designate one or more nominees to purchase the shares either within or
without divine. Upon timely exercise of the Repurchase Option in the manner
provided in this Article 19(a), the Optionee or his or her legal representative,
shall deliver to divine the stock certificate or certificates representing the
shares being repurchased, duly endorsed and free and clear of any and all liens,
charges and encumbrances.
If shares are not purchased under the Repurchase Option, the Optionee and his or
her successor in interest, if any, will hold any such shares in possession
subject to all of the provisions of this Agreement.
(b) divine's Right to Exercise Repurchase Option: divine shall have
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the Repurchase Option in the event that any of the following events
shall occur:
(i) The termination of the Optionee's employment with divine or
any Related Corporation (as defined in the Plan), voluntarily or
involuntarily, for any reason whatsoever, including death or
permanent disability, prior to the time this option shall be
fully vested provided in Article 3 hereof
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(ii) The receivership or bankruptcy of the Optionee, any other
creditor's proceeding affecting the Optionee's ownership of any
shares acquired upon exercise of this Option or the taking of any
of the Optionee's shares acquired upon exercise of this option by
legal process, such as a levy of execution;
(iii) Distribution of shares held by the Optionee to his or her
spouse as such spouse's joint or community interest pursuant to a
decree of dissolution, operation of law, divorce, property
settlement agreement or for any other reason, except as may be
otherwise permitted by divine; or
(iv) The termination of the Optionees employment by divine for
Misconduct (as defined in Article 18 hereof).
(c) Determination of Fair Market Value: The fair market value of the
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shares subject to this option shall be, for purposes of this Article 19, an
amount per share determined on the basis of the price at which shares of the
Common Stock could reasonably be expected to be sold in an arms-length
transaction, for cash, other than on an installment basis, to a person not
employed by, controlled by, in control of or under common control with divine.
Fair market value shall be determined by the Board of Directors, giving due
consideration to recent grants of incentive stock options for shares of Common
Stock, recent transactions involving shares of the Common Stock, if any,
earnings of divine to the date of such determination, projected earnings of
divine, the effect of the transfer restrictions to which the shares are subject
under law and this Agreement, the absence of a public market for the Common
Stock and such other matters as the Board of Directors deem pertinent. The
determination by the Board of Directors of the fair market value shall be
conclusive and binding. The fair market value of the share shall be determined
as of the day on which the event occurs.
20. Acceleration and vesting of Option for Business Combinations. If divine is
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to be consolidated with or acquired by another entity in a merger, sale of all
or substantially all of divine' s assets or otherwise (an "Acquisition"), then
this option shall, immediately prior to the consummation of such Acquisition,
become fully vested and immediately exercisable by the Optionee.
21. Lock-up Agreement. The Optionee agrees that the Optionee will not, for
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such period following the effective date of divine's initial distribution of
securities in an underwritten public offering to the general public pursuant to
a registration statement filed with the Securities and Exchange Commission as
the managing underwriter of such offering shall reasonably request, but in any
event not to exceed 120 days, directly or indirectly, sell, offer to sell or
otherwise dispose of divine's securities other than any securities that are
included in such initial public offering.
22. Provision of Documentation to Optionee. Signing this Agreement the
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Optionee acknowledges receipt of a copy of this Agreement and a copy of the
Plan.
23. Governing Law. This Agreement shall be governed by and interpreted in
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accordance with the internal laws of the State of Delaware.
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IN WITNESS WHEREOF divine and the Optionee have caused this instrument to be
executed, and the Optionee whose signature appears below acknowledges receipt of
a copy of the plan and acceptance of an original copy of this Agreement.
______________________________ divine, inc.
Optionee
______________________________ By:__________________________
Print name of Optionee
______________________________ Title:_______________________
Street Address
______________________________
City State Zip
Note: PERSON SIGNING ON BEHALF OF THE COMPANY MUST INITIAL ONE OF THE THREE
CLAUSES UNDER ARTICLE 7 ABOVE.
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