Exhibit 4.2
AMENDMENT No. 4
TO
RIGHTS AGREEMENT
THIS AMENDMENT No. 4 TO RIGHTS AGREEMENT (the "Amendment"), dated as
of July 16, 2002, is between divine, inc., a Delaware corporation formerly known
as divine interVentures, inc. (the "Company"), and Computershare Investor
Services, LLC, a Delaware limited liability company (the "Rights Agent").
RECITALS
A. The Company and the Rights Agent are parties to a Rights
Agreement dated as of February 12, 2001, as amended by Amendment No. 1 dated as
of July 8, 2001, and Amendment No. 2 dated as of August, 15, 2001, and Amendment
No. 3 dated as of May 29, 2002 (as amended, the "Rights Agreement");
B. Pursuant to Section 27 of the Rights Agreement, the Company and
the Rights Agent may supplement or amend the Rights Agreement from time to time
in accordance with the provisions of Section 27 thereof;
C. The Company has entered into an Amended and Restated Securities
Purchase Agreement dated on or about July 16, 2002 (the "Amended and Restated
Securities Purchase Agreement"), pursuant to which the Company will (i) issue
shares of its Series B-1 Convertible Preferred Stock (the "Series B-1 Preferred
Stock") to certain persons identified therein as "Buyers" (including, but not
limited to, Oak Investment Partners X, Limited Partnership; Oak X Affiliates
Fund, Limited Partnership; Oak Investment Partners IX, Limited Partnership; Oak
IX Affiliates Fund, Limited Partnership; and Oak IX Affiliates Fund-A, Limited
Partnership) in exchange for shares of the Company's Series B Convertible
Preferred Stock previously issued to certain of such Buyers under and pursuant
to that certain Securities Purchase Agreement dated on or about May 28, 2002
(the "Original Securities Purchase Agreement") and (ii) issue additional shares
of Series B-1 Preferred Stock to the Buyers;
D. The Board of Directors of the Company has determined that the
issuance and sale of its Series B-1 Preferred Stock and the other transactions
contemplated by the Amended and Restated Securities Purchase Agreement are fair
to and in the best interests of the Company and its stockholders; and
E. The Board of Directors of the Company has determined that it is
desirable to amend the Rights Agreement in connection with the transactions
contemplated by the Amended and Restated Securities Purchase Agreement.
AGREEMENTS
Accordingly, the parties agree as follows:
1. AMENDMENT OF SECTION 1(a). The definition of "Acquiring Person"
in Section 1(a) of the Rights Agreement is hereby amended and restated in its
entirety as follows:
(a) "ACQUIRING PERSON" shall mean any Person who or which, together with
all Affiliates and Associates of such Person, shall be the Beneficial Owner of
15% or more of the shares of Common Stock then outstanding, but shall not
include (i) the Company, (ii) any Subsidiary of the
1
Company, (iii) any employee benefit plan of the Company, or of any Subsidiary of
the Company, or any Person or entity organized, appointed or established by the
Company for or pursuant to the terms of any such plan, (iv) any Person who
becomes the Beneficial Owner of fifteen percent (15%) or more of the shares of
Common Stock then outstanding as a result of a reduction in the number of shares
of Common Stock outstanding due to the repurchase of shares of Common Stock by
the Company unless and until such Person, after becoming aware that such Person
has become the Beneficial Owner of fifteen percent (15%) or more of the then
outstanding shares of Common Stock, acquires beneficial ownership of additional
shares of Common Stock representing one percent (1%) or more of the shares of
Common Stock then outstanding, (v) any Person who is or becomes a party to that
certain Securities Purchase Agreement, dated on or about May 28, 2002, by and
among the Company and the Persons identified therein as "Buyers" (including, but
not limited to, Oak Investment Partners X, Limited Partnership; Oak X Affiliates
Fund, Limited Partnership; Oak Investment Partners IX, Limited Partnership; Oak
IX Affiliates Fund, Limited Partnership; Oak IX Affiliates Fund-A, Limited
Partnership; and their Affiliates or Associates (collectively, the "Oak
Group")), as amended (the "Original Securities Purchase Agreement") and/or that
certain Amended and Restated Securities Purchase Agreement, dated on or about
July 16, 2002, by and among the Company and the Persons identified therein as
"Buyers" (including, but not limited to, the Oak Group), as amended (the
"Amended and Restated Securities Purchase Agreement"), but only to the extent
such Person would become an Acquiring Person due to the Beneficial Ownership of
Common Stock issued or issuable upon conversion of Series B Convertible
Preferred Stock and/or Series B-1 Convertible Preferred Stock issued pursuant to
the Original Securities Purchase Agreement and/or the Amended and Restated
Securities Purchase Agreement, respectively, or (vi) any Person which
beneficially owns 10% or more of the shares of Common Stock outstanding on
February 12, 2001, unless and until such time as such Person together with its
Affiliates and Associates, directly or indirectly, becomes the Beneficial Owner
of 20% or more of the shares of Common Stock then outstanding, in which event
such Person shall immediately become an Acquiring Person.
2. EFFECTIVENESS. This Amendment shall be deemed effective as of
July 16, 2002, as if executed on such date. Except as amended hereby, the Rights
Agreement shall remain in full force and effect and shall be otherwise
unaffected hereby.
3. MISCELLANEOUS. This Amendment shall be deemed to be a contract
made under the laws of the State of Delaware and for all purposes shall be
governed by and construed in accordance with the laws of the State of Delaware
applicable to contracts to be made and performed entirely within the State of
Delaware. This Amendment may be executed in any number of counterparts, each of
such counterparts shall for all purposes be deemed to be an original, and all
such counterparts shall together constitute but one and the same instrument. If
any term, provision, covenant, or restriction of this Amendment is held by a
court of competent jurisdiction or other authority to be invalid, void, or
unenforceable, the remainder of the terms, provisions, covenants, and
restrictions of this Amendment shall remain in full force and effect and shall
in no way be affected, impaired, or invalidated.
[The remainder of this page has been intentionally left blank.]
2
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, all as of the day and year first above written.
DIVINE, INC.
By /s/ Xxxxxxx X. Xxxxxxxxx
------------------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Executive Vice President,
Chief Financial Officer, and
Treasurer
COMPUTERSHARE INVESTOR SERVICES, LLC
By /s/ Xxx Xxxxxx
------------------------------------------
Name: Xxx Xxxxxx
Title: Relationship Manager
3
