Exhibit 4.5


 


SECOND AMENDMENT

TO

RIGHTS AGREEMENT


 


THIS SECOND AMENDMENT TO RIGHTS AGREEMENT (the “Amendment”)
is entered into as of April 20, 2010, between EVOLVING SYSTEMS, INC., a
Delaware corporation (the “Company”), and AMERICAN STOCK TRANSFER &
TRUST COMPANY LLC (the “Rights Agent”).


 


WHEREAS, the Company and the Rights Agent have entered
into that certain Rights Agreement dated as of March 4, 2009, as amended
by that certain First Amendment to Rights Agreement dated as of December 10,
2010 (as amended, the “Rights Agreement”); and


 


WHEREAS, the Company and the Rights Agent wish to
amend the Rights Agreement in order to increase the percentage of shares of the
Common Shares that a Person may become the Beneficial Owner of without being
deemed to be an Acquiring Person.


 


NOW, THEREFORE, in consideration of the premises and
the mutual agreements herein set forth, the parties hereby agree as follows:


 


1.     Section 1(a) of
the Rights Agreement is hereby amended and restated in its entirety to read as
follows:


 


(a)           “Acquiring
Person” shall mean any Person (as such term is hereinafter defined) who or
which, together with all Affiliates and Associates (as such terms are
hereinafter defined) of such Person, shall be the Beneficial Owner (as such
term is hereinafter defined) of 29.0% or more of the Common Shares then
outstanding.  Notwithstanding the
foregoing, (i) the term Acquiring Person shall not include (A) the
Company, (B) any Subsidiary (as such term is hereinafter defined) of the
Company, (C) any employee benefit or compensation plan of the Company or
any Subsidiary of the Company, (D) any Person holding Common Shares for or
pursuant to the terms of any such employee benefit or compensation plan, and (ii) no
Person shall become an “Acquiring Person”: (A) as the result of an
acquisition of Common Shares by the Company which, by reducing the number of
shares outstanding, increases the proportionate number of shares beneficially
owned by such Person to 29.0% or more of the Common Shares then outstanding;
provided, however, that if a Person shall become the Beneficial Owner of 29.0%
or more of the Common Shares then outstanding by reason of share purchases by
the Company and shall, following written notice from, or public disclosure by
the Company of such share purchases by the Company, become the Beneficial Owner
of any additional Common Shares without the prior consent of the Company and
shall then Beneficially Own more than 29.0% of the Common Shares then
outstanding, then such Person shall be deemed to be an “Acquiring Person,” (B) a
Person who would otherwise be an “Acquiring Person,” as defined pursuant to the
foregoing provisions of this Section 1(a), has become such as a result of
the acquisition of Common Shares directly from the Company or pursuant to the exercise
of options pursuant to the option plan of the Company; provided, however, that
if such Person shall purchase additional Common Shares after becoming the
Beneficial Owner of 29.0% or more of the Common Shares then outstanding, such
Person shall be deemed an “Acquiring Person,” subject to the exceptions set
forth in this Section 1(a), or (C) if the Board of Directors
determines in good faith that a Person who would otherwise be an “Acquiring
Person,” as defined pursuant to the foregoing provisions of this Section 1(a),
has become such inadvertently, and such Person divests, as promptly as
practicable (as determined in good faith by the Board of Directors), but in any
event within five Business Days, following receipt of written notice from the
Company of such event, of Beneficial Ownership of a sufficient number of Common
Shares so that such Person would no longer be an Acquiring Person, as defined
pursuant to the foregoing provisions of this Section 1(a), then such
Person shall no longer be deemed to be an “Acquiring Person” for purposes of
this Agreement; provided, however, that if such Person shall again become the
Beneficial Owner of 29.0% or more of the Common Shares then outstanding, such
Person shall be deemed an “Acquiring Person,” subject to the exceptions set
forth in this Section 1(a).


 


1

















 


2.     Section 23(b)(ii) of
the Rights Agreement is hereby amended and restated in its entirety to read as
follows:


 


(ii)           In
addition, the Board of Directors of the Company may, at its option, at any time
after the time a Person becomes an Acquiring Person and the expiration of any
period during which the holder of Rights may exercise the rights under Section 11(a)(ii) hereof
but prior to any event described in clause (i), (ii) or (iii) of Section 13(a) hereof,
redeem all but not less than all of the then outstanding Rights at the
Redemption Price (x) in connection with any merger, consolidation or sale
or other transfer (in one transaction or in a series of related transactions)
of stock, assets or earning power aggregating 50% or more of the stock, assets
or earning power of the Company and its subsidiaries (taken as a whole) in
which all holders of Common Shares are treated alike and not involving (other
than as a holder of Common Shares being treated like all other such holders) an
Interested Stockholder or a Transaction Person or (y)(A) if and for so
long as the Acquiring Person is not thereafter the Beneficial Owner of 29.0% or
more of the then outstanding Common Shares, and (B) at the time of
redemption no other Persons are Acquiring Persons.


 


3.     Exhibit C
of the Rights Agreement is hereby amended and restated in its entirety to read
as provided in Exhibit C hereto.


 


4.     The Rights
Agreement, as amended hereby, shall be and remain in full force and effect in
accordance with its terms and is ratified and confirmed hereby in all respects.


 


5.     This
Amendment may be executed in any number of counterparts and 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.


 


6.     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 such State applicable to contracts to be made and performed
entirely within such State.


 


7.     This
Amendment and the other documents delivered pursuant hereto constitute the full
and entire understanding and agreement between the parties with regard to the
subjects hereof.


 


8.     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 Agreement shall remain in full force and effect and shall
in no way be affected, impaired or invalidated.


 


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IN WITNESS WHEREOF, the parties hereto have caused
this Amendment to be duly executed, all as of the day and year first above
written.


 


	
   

  	
  Attest: EVOLVING
  SYSTEMS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ THADDEUS DUPPER

  
	
   

  	
  Thaddeus Dupper

  
	
   

  	
  Chairman and Chief
  Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/
  ANITA T. MOSELEY

  
	
   

  	
  Anita T.Moseley

  
	
   

  	
  Secretary

  



 

















 


	
   

  	
  Attest: AMERICAN STOCK
  TRANSFER &

  TRUST COMPANY LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ HERBERT J. LEMMER

  
	
   

  	
  Print Name:

  	
  Herbert J. Lemmer

  



 

















 


EXHIBIT C TO RIGHTS AGREEMENT


 


FORM OF SUMMARY OF RIGHTS TO PURCHASE PREFERRED
SHARES


 

















 


EVOLVING SYSTEMS, INC.


 


SUMMARY OF RIGHTS TO PURCHASE

PREFERRED SHARES


 


On March 4,
2009, the Board of Directors of Evolving Systems, Inc. (the “Company”)
declared a dividend of one preferred share purchase right (a “Right”) for each
outstanding share of common stock, par value $0.001 per share (the “Common
Shares”), of the Company.  The dividend
is effective as of March 16, 2009 (the “Record Date”) with respect to the
stockholders of record on that date.  The
Rights will also attach to new Common Shares issued after the Record Date.  Each Right entitles the registered holder to
purchase from the Company one one-hundredth of a share of Series C Junior
Participating Preferred Stock, par value $0.001 per share (the “Preferred
Shares”), of the Company at a price of $8.00 per one one-hundredth of a
Preferred Share (the “Purchase Price”), subject to adjustment.  Each Preferred Share is designed to be the
economic equivalent of 100 Common Shares. 
The description and terms of the Rights are set forth in a Rights
Agreement dated as of March 4, 2009 between the Company and American Stock
Transfer & Trust Company LLC (the “Rights Agent”), as amended by the
First Amendment to Rights Agreement dated as of December 10, 2009, between
the Company and the Rights Agent and the Second Amendment to Rights Agreement
dated as of April 20, 2010, between the Company and the Rights Agent (as
amended, the “Rights Agreement”).


 


DETACHMENT
AND TRANSFER OF RIGHTS


 


Initially,
the Rights will be evidenced by the stock certificates representing Common
Shares then outstanding, and no separate Right Certificates will be
distributed.  Until the earlier to occur
of (i) a public announcement that a person or group of affiliated or
associated persons, has become an “Acquiring Person” (as such term is defined
in the Rights Agreement) or (ii) 10 business days (or such later date as
the Board may determine) following the commencement of, or announcement of an
intention to make, a tender offer or exchange offer which would result in the
beneficial ownership by an Acquiring Person of 29.0% or more of the outstanding
Common Shares (the earlier of such dates being called the “Distribution Date”),
the Rights will be evidenced, with respect to any of the Common Share
certificates outstanding as of the Record Date, by such Common Share
certificate.  In general, an “Acquiring
Person” is a person, the affiliates or associates of such person, or a group,
which has acquired beneficial ownership of 29.0% or more of the outstanding
Common Shares.


 


The
Rights Agreement provides that, until the Distribution Date (or earlier
redemption or expiration of the Rights), the Rights will be transferable with
and only with the Common Shares.  Until
the Distribution Date (or earlier redemption or expiration of the Rights), new
Common Share certificates issued after the Record Date upon transfer or new
issuance of Common Shares will contain a notation incorporating the Rights
Agreement by reference.  Until the
Distribution Date (or earlier redemption or expiration of the Rights) the
surrender or transfer of any certificates for Common Shares outstanding as of
the Record Date, even without such notation or a copy of this Summary of Rights
being attached thereto, will also constitute the transfer of the Rights
associated with the Common Shares represented by such certificate.  As soon as practicable following the
Distribution Date, separate certificates evidencing the Rights (“Right
Certificates”) will be mailed to holders of record of the Common Shares as of
the close of business on the Distribution Date and such separate Right
Certificates alone will evidence the Rights.


 


EXERCISABILITY
OF RIGHTS


 


The
Rights are not exercisable until the Distribution Date.  The Rights will expire on March 4, 2019
(the “Final Expiration Date”), unless the Final Expiration Date is extended or
unless the Rights are earlier redeemed or exchanged by the Company, in each
case as described below.  Until a Right
is exercised, the holder thereof, as such, will have no rights as a stockholder
of the Company, including, without limitation, the right to vote or to receive
dividends.


 


The
Purchase Price payable, and the number of Preferred Shares or other securities
or property issuable or payable, upon exercise of the Rights are subject to
adjustment from time to time to prevent dilution.  The number of outstanding Rights and the
number of one one-hundredths of a Preferred Share issuable upon exercise of
each Right are also subject to adjustment in the event of a stock split of the
Common Shares or a stock dividend on the Common Shares payable in Common
Shares, or subdivisions, consolidations or combinations of the Common Shares
occurring, in any such case, prior to the Distribution Date.  With certain exceptions, no adjustment in the
Purchase Price will be required until cumulative adjustments require an
adjustment of at least 1% in such Purchase Price.  No fractional Preferred Shares will be issued
(other than fractions which are integral multiples of one one-hundredth of a
Preferred Share, which may, at the election of the Company, be evidenced by
depositary receipts) and in lieu thereof, an adjustment in cash will be made
based on the market price of the Preferred Shares on the last trading day prior
to the date of exercise.


 

















 


TERMS
OF PREFERRED SHARES


 


Preferred
Shares purchasable upon exercise of the Rights will not be redeemable.  Each Preferred Share will be entitled to a
minimum preferential quarterly dividend payment of $l per share but will be
entitled to an aggregate dividend of 100 times the dividend declared per Common
Share.  In the event of liquidation, the
holders of the Preferred Shares will be entitled to a minimum preferential
liquidation payment of $100 per share but will be entitled to an aggregate
payment of 100 times the payment made per Common Share.  Each Preferred Share will have 100 votes,
voting together with the Common Shares. 
Finally, in the event of any merger, consolidation or other transaction
in which Common Shares are exchanged, each Preferred Share will be entitled to
receive 100 times the amount received per Common Share.  These rights are protected by customary
anti-dilution provisions.  Because of the
nature of the Preferred Shares’ dividend, liquidation and voting rights, the
value of the one one-hundredth interest in a Preferred Share purchasable upon
exercise of each Right should approximate the value of one Common Share.  The Preferred Shares would rank junior to any
other series of the Company’s preferred stock.


 


TRIGGER
OF FLIP-IN AND FLIP-OVER RIGHTS


 


In the
event that any person or group of affiliated or associated persons becomes an
Acquiring Person, proper provision shall be made so that each holder of a
Right, other than Rights beneficially owned by the Acquiring Person or any
affiliate or associate thereof (which will thereafter be void), will thereafter
have the right to receive upon exercise that number of Common Shares having a
market value of two times the exercise price of the Right.  This right will commence on the date of
public announcement that a person has become an Acquiring Person (or the
effective date of a registration statement relating to distribution of the
rights, if later) and terminate 60 days later (subject to adjustment in the
event exercise of the rights is enjoined).


 


In the
event that the Company is acquired in a merger or other business combination
transaction or 50% or more of its stock, consolidated assets or earning power
are sold to an Acquiring Person, its affiliates or associates or certain other
persons in which such persons have an interest, proper provision will be made
so that each such holder of a Right will thereafter have the right to receive,
upon the exercise thereof at the then current exercise price of the Right, that
number of shares of common stock of the acquiring company which at the time of
such transaction will have a market value of two times the exercise price of
the Right.


 


REDEMPTION
AND EXCHANGE OF RIGHTS


 


At any
time prior to the earliest of (i) the close of business on the day of the
first public announcement that a person has become an Acquiring Person, or (ii) the
Final Expiration Date, the Board of Directors of the Company may redeem the
Rights in whole, but not in part, at a price of $0.001 per Right (the “Redemption
Price”).  In general, the redemption of
the Rights may be made effective at such time on such basis with such
conditions as the Board of Directors in its sole discretion may establish.  Immediately upon any redemption of the
Rights, the right to exercise the Rights will terminate and the only right of the
holders of Rights will be to receive the Redemption Price.


 


At any
time after any Person becomes an Acquiring Person and prior to the acquisition
by such person or group of 50% or more of the outstanding Common Shares, the
Board of Directors of the Company may exchange the Rights (other than Rights
owned by such person or group which will have become void), in whole or in
part, at an exchange ratio of one Common Share, or, under circumstances set
forth in the Rights Agreement, cash, property or other securities of the
Company, including fractions of a Preferred Share (or of a share of a class or
series of the Company’s preferred stock having equivalent designations and the
powers, preferences and rights, and the qualifications, limitations and
restrictions), per Right (with value equal to such Common Shares).


 


AMENDMENT
OF RIGHTS


 


The
terms of the Rights generally may be amended by the Board of Directors of the
Company without the consent of the holders of the Rights, except that from and
after such time as the Rights are distributed no such amendment may adversely
affect the interests of the holders of the Rights (excluding the interest of
any Acquiring Person).


 


ADDITIONAL
INFORMATION


 


A copy
of the Rights Agreement has been filed with the Securities and Exchange
Commission (the “SEC”) as an Exhibit to a Current Report on Form 8-K
dated March 5, 2009 and a copy of the First Amendment to Rights Agreement
has been filed with the SEC as an Exhibit to an Annual Report on Form 10-K
dated December 14, 2009.  A copy of
the Rights Agreement is available from the Company by writing to: Anita T.
Moseley, Evolving Systems, Inc., 9777 Pyramid Court, Suite 100,
Englewood, CO 80112.  This summary
description of the Rights is not intended to be complete and is qualified in
its entirety by reference to the Rights Agreement, which is hereby incorporated
herein by reference.