<PAGE>
As filed with the Securities and Exchange Commission on July 29, 1997
Registration No. 333-_____
------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------
FORM S-8
REGISTRATION STATEMENT
Under the Securities Act of 1933
----------------
YURIE SYSTEMS, INC.
(Exact name of registrant as specified in its charter)
Delaware 52-1778987
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
8301 Professional Place
Landover, MD 20785-2237
(Address of principal executive offices, including zip code)
YURIE SYSTEMS, INC. AMENDED AND RESTATED
1996 NON STATUTORY STOCK OPTION PLAN
(Full title of the plans)
John J. McDonnell
General Counsel and Secretary
YURIE SYSTEMS, INC.
8301 Professional Place
Landover, MD 20785-2237
(301) 352-4600
(Name, address and telephone number,
including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------
Amount of Proposed Proposed
Title of Securities Additional Securities Maximum Maximum
to be Registered to be Registered Offering Aggregate Amount of
per Share Price Registration Fee
- -----------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock 2,000,000 * (1) * (1) $10,076.00(1)
($.01 par value) shares
===================================================================================
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee.
Pursuant to Rule 457(c), the registration fee is based upon a price of
$16.625 per share, the average of the high and low sales price for the
Registrant's Common Stock reported on the Nasdaq National Market System
for the Common Stock on July 25, 1997.
================================================================================
<PAGE>
EXPLANATORY NOTE
Registration of Additional Securities
On February 18, 1997, Yurie Systems, Inc. (the "Company"), filed a
Registration Statement (File No. 333-15759) on Form S-8 covering 5,000,000
shares of the Company's common stock, par value $0.01 per share (the "Common
Stock"), issuable upon exercise of stock options granted under the Yurie System
Inc. 1996 Non-Statutory Stock Option Plan (the "Plan").
On May 14, 1997, the Company's Board of Directors approved a resolution
amending and restating the Plan (the "Amended Plan") to increase the number of
shares of Common Stock issuable upon conversion of the stock options which may
be granted under the Plan from 5,000,000 to 7,000,000 and to revise the Plan in
light of the Company's experience with its terms. The remaining terms of the
Amended Plan are substantially the same as the terms of the Plan. On June 26,
1997 the Company's shareholders approved the Amended Plan. Therefore, the total
number of shares of Common Stock currently registered for issuance pursuant to
the Plan is 7,000,000 and this Registration Statement covers the additional
2,000,000 shares of Common Stock to be registered hereunder.
The contents of Registration Statement No. 333-15759 are hereby incorporated
by reference.
II-I
<PAGE>
<TABLE>
<CAPTION>
Item 8. Exhibits
<S> <C>
Exhibit No. Description of Exhibit
4.1 Yurie Systems, Inc. Amended and Restated 1996
NonStatutory Stock Option Plan.
5.1 Opinion of Fried, Frank, Harris, Shriver &
Jacobson as to the validity of the shares of
Common Stock covered by the Registration Statement.
23.1 Consent of Deloitte & Touche L.L.P.
23.2 Consent of Fried, Frank, Harris, Shriver & Jacobson (included
in Exhibit 5.1).
24.1.a Power of Attorney by Kenneth D. Brody
24.1.b Power of Attorney by William J. Perry
24.1.c Power of Attorney by Herbert Rabin
24.1.d Power of Attorney by R. James Woolsey
II-2
</TABLE>
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Company certifies that it has reasonable grounds to believe that it meets all of
the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Landover, State of Maryland, on July 29, 1997.
YURIE SYSTEMS, INC.
By: /s/Jeong H. Kim
-----------------------------
Jeong H. Kim
Chairman of the Board and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:
Signature Title Date
- --------- ----- ----
/s/Jeong H. Kim Chairman of the Board July 29, 1997
- --------------- and Chief Executive Officer
Jeong H. Kim (Principal Executive
Officer)
/s/Kwok L. Li Vice Chairman of the Board July 29, 1997
- ------------- and Chief Technology Officer
Kwok L. Li
/s/Harry J. Carr President and Chief July 29, 1997
- ---------------- Operating Officer, Director
Harry J. Carr
II-3
<PAGE>
Signature Title Date
- --------- ----- ----
/s/Barton Y. Shigemura Senior Vice President, July 29, 1997
- ---------------------- Sales and Marketing,
Barton Y. Shigemura Director
/s/Harry J. D'Andrea Chief Financial Officer July 29, 1997
- -------------------- and Treasurer (Principal
Harry J. D'Andrea Financial and Accounting
Officer)
* Director July 29, 1997
- --------------------
Kenneth D. Brody
* Director July 29, 1997
- --------------------
William J. Perry
* Director July 29, 1997
- -------------------
Herbert Rabin
* Director July 29, 1997
- -------------------
R. James Woolsey
*By: /s/Jeong H. Kim
----------------
Jeong H. Kim
Attorney-in-Fact
II-4
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Page No. in
Sequentially
Exhibit No. Description of Exhibit Numbered Copy
----------- ---------------------- -------------
<S> <C> <C>
4.1 Yurie Systems, Inc. Amended
and Restated 1996 NonStatutory
Stock Option Plan.
5.1 Opinion of Fried, Frank, Harris,
Shriver & Jacobson as to the
validity of the shares of Common
Stock covered by the Registration Statement.
23.1 Consent of Deloitte & Touche L.L.P.
23.2 Consent of Fried, Frank, Harris,
Shriver & Jacobson
(included in Exhibit 5.1).
24.1.a Power of Attorney by Kenneth D. Brody
24.1.b Power of Attorney by William J. Perry
24.1.c Power of Attorney by Herbert Rabin
24.1.d Power of Attorney by R. James Woolsey
</TABLE>
E-1
<PAGE>
Exhibit 4.1
YURIE SYSTEMS, INC.
AMENDED AND RESTATED
1996 NONSTATUTORY STOCK OPTION PLAN
1. Purpose.
-------
The purpose of this Plan is to secure for Yurie Systems, Inc. and its
shareholders the benefits arising from capital stock ownership by employees,
consultants, officers and members of the Board of Directors who are expected to
contribute to the future growth and success of the Company.
2. Definitions.
-----------
(1) "Beneficial Ownership" means beneficial ownership within the
meaning of Rule 13d-3 under the Exchange Act.
(2) "Board of Directors" means the Board of Directors of Yurie
Systems, Inc.
(3) "Change in Control" means the occurrence during the term of the
Plan and an Option Agreement of any one of the following events:
(a) An acquisition (other than directly from Yurie) of any
Voting Securities by any Person, immediately after which
such Person has Beneficial Ownership of 30 percent or more
of the combined voting power of Yurie's then outstanding
Voting Securities; provided however, that in determining
whether a Change in Control has occurred, Voting Securities
which are acquired in a Non-Control Acquisition shall not
constitute an acquisition which would cause a Change in
Control.
(b) The individuals who, as of January 1, 1997, are members of
the Incumbent Board, cease for any reason to constitute at
least two-thirds of the members of the Board of Directors;
provided, however, that if the election, or nomination for
election by Yurie's common stockholders, of any new director
was approved by a vote of at least two-thirds of the
Incumbent Board, such new director shall, for purposes of
this Plan, be considered as a member of the Incumbent Board;
provided further, however, that no individual shall be
considered a member of the Incumbent Board if such
individual initially assumed office as a result of either an
actual or threatened Election Contest (as described in Rule
14a-11 under the
<PAGE>
Exchange Act) or other actual or threatened Proxy Contest
(that is, solicitation of proxies or consents by or on
behalf of a Person other than the Board of Directors)
including by reason of any agreement intended to avoid or
settle any Election Contest or Proxy Contest; or
(c) Approval by stockholders of Yurie of:
(i) A merger, consolidation or reorganization involving
Yurie, unless such merger, consolidation or
reorganization is a Non-Control Transaction;
(ii) A complete liquidation or dissolution of Yurie; or
(iii) An agreement for the sale or other disposition of all
or substantially all of the assets of Yurie to any
Person (other than a transfer to a Subsidiary).
Notwithstanding the foregoing, a Change in Control shall not be
deemed to occur solely because any Person acquired Beneficial
Ownership of more than the permitted amount of the then
outstanding Voting Securities as a result of the acquisition of
Voting Securities by the Company which, by reducing the number of
Voting Securities then outstanding, increases the proportional
number of shares Beneficially Owned by such persons, provided
that if a Change in Control would occur (but for the operation of
this sentence) as a result of the acquisition of Voting
Securities by the Company, and after such share acquisition by
the Company, such Person becomes the Beneficial Owner of any
additional Voting Securities Beneficially Owned by such Person,
then a Change in Control shall occur.
(4) "Code" means the Internal Revenue Code of 1986, as amended from
time to time.
(5) "Common Stock" means the common stock of Yurie Systems, Inc.
having a par value of $0.01.
(6) "Company" means Yurie and any entities that are Subsidiaries of
Yurie or of which it is a Subsidiary.
(7) "Covered Employee" means that term as defined in Section
162(m)(3) of the Code.
(8) "Director" means a member of the Board of Directors of the
Company.
(9) "Director's Automatic Grant Agreement" means an Option Agreement
referred to in Section 4(d) hereof.
-2-
<PAGE>
(10) "Effective Date" means the date as of which an Option granted
pursuant to the Plan is effective.
(11) "Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time.
(12) "Fair Market Value of the Common Stock" on a given date means the
last reported sales price of the Common Stock on the NASDAQ
(National) System, as reported in a national newspaper, on such
date or on the nearest prior day on which trading of the Common
Stock occurred on the NASDAQ (National) System, or if the stock
is listed on a national stock exchange, the last reported sales
price of the Common Stock on such exchange, as reported in a
national newspaper, on such date or the nearest prior day on
which trading of the Common Stock occurred on such exchange;
provided that if the Common Stock is not registered with the
Securities and Exchange Commission or there has been no trading
of the Common Stock on or reasonably near and prior to the given
date, it shall be the fair market value of the Common Stock on
the given date as determined on such basis as the Board of
Directors shall establish for this purpose.
(13) "Incumbent Board" means the Board of Directors as constituted on
May 1, 1997.
(14) "Independent Director" means a member of the Board of Directors
who is not an employee of the Company.
(15) "Merger Price" means, in the event of a merger described in
Section 12(a) hereof, any cash payment that holders of Common
Stock receive for each share of Common Stock surrendered in the
merger.
(16) "Non-Control Acquisition" means an acquisition by: (i) an
employee benefit plan (or a trust forming a part thereof)
maintained by the Company or any subsidiary; (ii) the Company or
its Subsidiaries; (iii) a Person who as of January 1, 1997 has
Beneficial Ownership of 30 percent or more of the combined voting
power of Yurie's then outstanding Voting Securities; or (iv) any
Person in connection with a Non-Control Transaction.
(17) "Non-Control Transaction" means a merger consolidation or
reorganization of Yurie where:
(a) the stockholders of Yurie, immediately before such merger,
consolidation or reorganization, own directly or indirectly
immediately following such merger, consolidation or
reorganization, at least 70 percent of the combined voting
power of the outstanding voting securities of the surviving
corporation in
-3-
<PAGE>
substantially the same proportion as their ownership of the
Voting Securities immediately before such merger,
consolidation or reorganization;
(b) the individuals who were members of the Incumbent Board
immediately prior to the execution of the agreement
providing for such merger, consolidation or reorganization
constitute at least two-thirds of the members of the board
of directors of the surviving corporation, or a corporation
beneficially directly or indirectly owning a majority of the
voting securities of the surviving corporation; and
(c) no Person other than (i) Yurie, (ii) any Subsidiary, (iii)
any employee benefit plan (or any trust forming a part
thereof) maintained by Yurie, the surviving corporation, or
any Subsidiary, or (iv) any Person who, immediately prior to
such merger, consolidation or reorganization had Beneficial
Ownership of 30 percent or more of the then outstanding
Voting Securities, has Beneficial Ownership of 30 percent or
more of the combined voting power of the surviving
corporation's then outstanding voting securities.
(18) "Non-Employee Director" means that term as defined in Rule 16b-3.
(19) "Officer" means a person who is an officer of the Company for
purposes of Rule 16b-3.
(20) "Option" means a stock option granted pursuant to this Plan.
(21) "Option Agreement" means an agreement entered into pursuant to
Section 7 hereof.
(22) "Option Shares" means shares of Common Stock that may be
purchased by an optionee, pursuant to this Plan and the
optionee's Option Agreement.
(23) "Option Term" means the period during which an Option is
outstanding.
(24) "Outside Director" means that term as defined in Treas. Reg.
(S)1.162-27(e)(3).
(25) "Person" means a person for purposes of Section 13(d) or 14(d) of
the Exchange Act.
(26) "Plan" means the Yurie Systems, Inc. Amended and Restated 1996
Nonstatutory Option Plan, as amended from time to time.
-4-
<PAGE>
(27) "Pooling Transaction" means a business combination that qualifies
for use of the pooling of interests accounting method under
generally accepted accounting principles.
(28) "Rule 16b-3" means Rule 16b-3 under the Exchange Act of 1934, or
any successor rule.
(29) "Subsidiary" means, as to any entity, a corporation or other
Person of which a majority of its voting power or its voting
equity securities or equity interest is owned, directly or
indirectly, by the entity.
(30) "Voting Securities" means any voting securities of Yurie.
(31) "Yurie" means Yurie Systems, Inc.
3. Type of Options and Administration.
----------------------------------
a. Type of Options. The options granted pursuant to the Plan shall
---------------
be non-statutory options which are not intended to meet the requirements of
Section 422 of the Code.
b. Administration. The Plan will be administered by the Board of
--------------
Directors. The Board shall have authority, subject to the express provisions of
the Plan, to construe the Option Agreements and the Plan, to prescribe, amend
and rescind rules and regulations relating to the Plan, to determine the terms
and provisions of the Option Agreements, which need not be identical, and to
make any other determination which, in the judgment of the Board of Directors,
is necessary or desirable for the administration of the Plan. The Board of
Directors' construction and interpretation of the terms and provisions of the
Plan and any determinations made by the Board pursuant thereto shall be final
and conclusive.
c. Delegation. Except as provided in Section 4(c), the Board of
----------
Directors may, to the full extent permitted by or consistent with applicable
laws or regulations and the governing documents of Yurie, delegate any or all of
its powers under the Plan to a committee appointed by the Board of Directors.
If a committee is so appointed, all references to the Board of Directors in the
Plan shall mean and relate to such committee. To the extent required by Rule
16b-3, however, such committee shall consist solely of Non-Employee Directors
when exercising any powers relating to options granted to Directors.
-5-
<PAGE>
d. Applicable Law. The provisions of this Plan and the Option
--------------
Agreements shall be interpreted in a manner consistent with all applicable law,
including but not limited to the Exchange Act and the rules and regulations
thereunder. Any authority or discretion exercised under the Plan by the Board
of Directors or any other person or entity shall be exercised in a manner
consistent with all applicable law, including but not limited to the Exchange
Act and the rules and regulations thereunder.
4. Eligibility for and Issuance of Grants.
--------------------------------------
a. Eligibility. Options may be granted only to persons who are, at
-----------
the time of the grant: (i) Directors, Officers or employees of the Company or
(ii) consultants or advisors to the Company.
b. Grant of Options Generally. Subject to the express provisions of
--------------------------
the Plan, the Board of Directors may in its sole discretion grant Options to
purchase shares of the Common Stock and issue shares upon exercise of such
Options.
c. Grant of Options to Officers. Any grant, or modification of any
----------------------------
grant, to an Officer shall be made by the Board of Directors, provided, however
that to the extent required by Section 162(m)(4)(C) of the Code, any grant or
modification of options to an Officer who is a Covered Employee shall be made by
a committee composed solely of two or more Outside Directors.
d. Automatic Grants to Directors. Each Independent Director who has
-----------------------------
executed a Director's Automatic Grant Agreement shall receive a grant of Options
of 5,000 shares of Common Stock effective on the 30th day of June of each year
beginning on June 30, 1997. A Director's Automatic Grant Agreement shall be
approved by the Board of Directors prior to execution by the Independent
Director and shall set forth the Option term, the time for exercising the
Option, the Option price, the Effective Date of the Option and all other terms
at which Common Stock may be purchased pursuant to the Options granted to the
Independent Director. For this purpose, the exercise price shall be the Fair
Market Value of the Common Stock, as defined in Section 2(12) hereof, but
without regard to the proviso clause, on the
-6-
<PAGE>
Effective Date of the Option. A Director's Automatic Grant Agreement shall not
be inconsistent with the terms of the Plan, and in the event of a conflict
between the terms of the Plan and the Director's Automatic Grant Agreement, the
terms of the Plan shall supersede the terms of such Agreement unless the terms
of the Plan are inconsistent with the requirements of Rule 16b-3. Each such
Agreement shall be appended to the Plan and is hereby incorporated by reference.
Options granted pursuant to this Section 4(d) shall be subject to the terms and
conditions set forth in this Plan to the extent not inconsistent with this
Section 4(d).
5. Stock Subject to Plan.
---------------------
a. Limitations on Number of Shares. Subject to adjustment as
-------------------------------
provided in Section 11 below, the maximum number of shares of Common Stock which
may be issued and sold under the Plan is 7,000,000 shares. The maximum number
of shares of Common Stock that can be offered to any optionee in any year shall
be 1,500,000 shares. Such shares may be authorized and unused shares or may be
shares issued and thereafter acquired by Yurie.
b. Unpurchased Shares. If an Option shall expire or terminate for
------------------
any reason without having been exercised in full, the unpurchased shares subject
to such Option shall again be available for subsequent Option grants under the
Plan.
6. Term and Exercise.
-----------------
a. Option Term. Unless otherwise provided in the Option Agreement,
-----------
the Option Term of an Option granted under the Plan shall be ten years from the
Effective Date of the Option.
b. Exercise. Options issued hereunder shall become exercisable as
--------
follows:
i. General. Unless otherwise provided in the Option Agreement,
-------
the initial grant of Options issued hereunder to an individual shall become
exercisable in installments, the optionee having the right to purchase the
following number of Option Shares, on or after the following dates, in
cumulative fashion: (i) on the first day of the month beginning on or after the
first anniversary of the Effective Date, up to one-fourth of the total number of
-7-
<PAGE>
Option Shares; (ii) on the first day of each of the succeeding 35 months, up to
1/48th of the total number of Option Shares; (iii) on the first day of the
36th succeeding month, any remaining Option Shares. If the division of a
number of shares pursuant to the preceding sentence results in a fractional
number of shares, such fractional number shall be rounded off to the nearest
integer. The optionee may purchase fewer than the total number of Option Shares
with respect to which the Option is exercisable, provided that no partial
exercise of the Option may be for any fractional shares.
Any subsequent grant of options to the same individual shall become
exercisable as provided in the Option agreement.
ii. Change in Control. Notwithstanding anything contained in
-----------------
any Option Agreement to the contrary, in the event of a Change in Control, all
outstanding Options shall become exercisable in full immediately prior to such
Change in Control.
7. Forms of Option Agreements.
--------------------------
As a condition to the grant of an Option under the Plan, each
recipient of an Option shall execute an Option Agreement in such form not
inconsistent with the Plan as may be approved by the Board of Directors. Option
Agreements may differ among recipients, and each Option Agreement shall state
the price, the number of shares subject to the Option, and other terms at which
the underlying stock can be purchased pursuant to the Option. In the event of a
conflict between the terms of this Plan and an Option Agreement entered into
pursuant to this Plan, the terms of the Plan shall supersede the terms of the
Option Agreement.
8. Purchase Price.
--------------
a. General. The option price shall be the Fair Market Value of the
-------
Common Stock as of the Effective Date of the Option.
b. Payment of Purchase Price.
-------------------------
-8-
<PAGE>
i. Cash or Stock Owned by Optionee. Options granted under the
-------------------------------
Plan may provide for the payment of the exercise price by delivery of cash or a
check to the order of Yurie in an amount equal to the exercise price of such
Options or by delivery to Yurie of shares of Common Stock then owned by the
optionee having a Fair Market Value equal in amount to the exercise price of
such shares, or by any combination of such methods of payment. Provided,
however, that if an Officer or Director elects to make payment by delivery to
Yurie of shares of Common Stock, such election must be approved in advance by
the Board of Directors.
ii. Other Cashless Exercise Procedures. Options granted under
----------------------------------
the Plan also may be exercised through a registered broker-dealer or through
such other cashless exercise procedures (in addition to the use of stock already
owned by the optionee) that are, from time to time, established by the Board of
Directors.
c. Delivery of Shares. Yurie shall not be required to transfer or
------------------
deliver any certificate or certificates for shares purchased upon any exercise
of an Option until after (i) the stock has been paid for in accordance with the
terms of the Option Agreement and the certificate has been requested, and (ii)
compliance with all then applicable requirements of law including, but not
limited to, collection by the Company from the optionee of all requisite income
and employment taxes and compliance with the federal and state securities laws.
9. Transferability and Termination of Options.
------------------------------------------
a. General. Unless otherwise provided in the Option Agreement, no
-------
Option granted under the Plan shall be assignable or transferable by the
optionee to whom it is granted, except pursuant to a domestic relations order
(as defined in Section 414(p) of the Code) or, in the event of the optionee's
death, by will or the laws of descent and distribution. During the lifetime of
an optionee, an Option shall be exercisable only by the optionee or, if the
optionee becomes incompetent, by a guardian or other person duly authorized by
law to administer the optionee's assets or by the party to whom the Option is
transferred pursuant to such a domestic relations order. If an Option is so
transferred to, or exercisable by, a person other than the optionee, the terms
of the Option granted to the optionee shall be final, binding and conclusive
upon such other person.
-9-
<PAGE>
b. Effect of Death and Termination of Employment. The Board of
---------------------------------------------
Directors shall determine the period of time during which an Option may be
exercised following: (i) the termination of the optionee's employment or other
relationship with the Company or (ii) the death or disability of the optionee.
Such periods shall be set forth in the Option Agreement.
10. Additional Provisions.
---------------------
a. Additional Option Provisions. The Board of Directors may, in its
----------------------------
sole discretion, include additional provisions in any Option Agreement,
including, without limitation, provisions relating to restrictions on transfer,
repurchase rights, rights to the optionee's work product, noncompetition
restrictions, or commitments to (i) pay cash bonuses, (ii) make, arrange for or
guaranty loans, or (iii) transfer other property to optionees upon exercise of
Options, or such other provisions as shall be determined by the Board of
Directors; provided that such additional provisions shall not be inconsistent
with any other term or condition of the Plan.
b. Acceleration. The Board of Directors may, in its sole
------------
discretion: (i) accelerate the date or dates on which all or any particular
Option or Options granted under the Plan may be exercised; or (ii) extend the
dates during which all or any particular Option or Options granted under the
Plan may be exercised; provided, however, that no such acceleration or extension
shall be permitted if it would cause the Plan or the Option to fail to satisfy
the requirements of Rule 16b-3 or of Section 162(m)(4)(C) of the Code (relating
to performance-based compensation).
c. Cancellation and New Grant of Options. The Board of Directors
-------------------------------------
shall have the authority to effect, at any time and from time to time, with the
consent of the affected optionees: (i) the cancellation of any or all
outstanding Options under the Plan and the grant in substitution therefor of new
Options under the Plan covering the same or different numbers of shares of
Common Stock having an exercise price per share which may be lower or higher
than the exercise price per share of the canceled options or (ii) the amendment
of the terms of any and all outstanding Options under the Plan to provide an
Option price which is higher or lower than the then-current Option price of such
outstanding Options. No cancellation or amendment of an Option will be made,
however, to the extent it would cause an Option to fail to satisfy the
-10-
<PAGE>
requirements of Rule 16b-3 or of Section 162(m)(4)(C) of the Code (relating to
performance-based compensation).
11. Recapitalizations and Related Transactions by Yurie.
---------------------------------------------------
a. General. If, through or as a result of any merger,
-------
consolidation, sale of all or substantially all of the assets of Yurie,
reorganization, recapitalization, reclassification, stock dividend, stock split,
reverse stock split or other similar distribution with respect to the
outstanding shares of Common Stock or other securities, (i) the outstanding
shares of Common Stock are increased or decreased, or are exchanged for a
different number or kind of shares or other securities of Yurie or (ii)
additional shares or new or different shares or other securities of Yurie or
other non-cash assets are distributed with respect to such shares of Common
Stock or other securities, an appropriate and proportionate adjustment may be
made in (x) the maximum number and kind of shares reserved for issuance under
the Plan, (y) the number and kind of shares or other securities subject to then
outstanding Options under the Plan, and (z) the price for each share subject to
any then outstanding Options under the Plan, without changing the aggregate
purchase price as to which such Options remain exercisable.
b. Board Authority to Make Adjustments. Adjustments under this
-----------------------------------
Section 11 will be made by the Board of Directors, whose determination as to
what adjustments, if any, will be made and the extent thereof will be final,
binding and conclusive. No fractional shares will be issued under the Plan on
account of any such adjustments.
12. Merger, Consolidation, Asset Sale or Liquidation of Yurie.
---------------------------------------------------------
a. Acquisition of Yurie. Subject to the provisions of Section
--------------------
6(b)(ii) regarding Change in Control transactions, in the event of a merger,
consolidation or reorganization of the stock, business or assets of Yurie or a
sale of all or substantially all of the stock, business or assets of Yurie in
which outstanding shares of Common Stock are exchanged for securities, cash or
other property of any other corporation or business entity, or in the event of a
liquidation of Yurie, the Board of Directors, or the board of directors of any
corporation assuming the obligations of Yurie, may, in its discretion, take any
one or more of the following
-11-
<PAGE>
actions as to outstanding Options: (i) provide that such Options shall be
assumed, or equivalent options shall be substituted, by the acquiring or
succeeding corporation (or an affiliate thereof), (ii) upon written notice to
the optionees, provide that all unexercised Options will terminate immediately
prior to the consummation of such transaction unless exercised by the optionee
within a specified number of days following the date of such notice, (iii) in
the event of a merger under the terms of which holders of the Common Stock will
receive upon consummation thereof a cash payment for each share surrendered in
the merger, make or provide for a cash payment to the optionees equal to the
difference between (X) the Merger Price times the number of shares of Common
Stock subject to such outstanding Options (to the extent exercisable at prices
not in excess of the Merger Price) and (Y) the aggregate exercise price of all
such outstanding Options in exchange for the termination of such options, and
(iv) provide that all or any outstanding Options shall become exercisable in
full immediately prior to such event. In any such case, the Board of Directors
may, in its discretion, advance the lapse of any waiting or installment periods
and exercise dates.
b. Acquisition by Yurie. The Board of Directors may grant options
--------------------
under the Plan in substitution for options held by employees of another
corporation who become employees of the Company, as the result of a merger or
consolidation of the employing corporation with the Company, or as a result of
the acquisition by the Company, of property or stock of the employing
corporation. Substitute options may be granted on such terms and conditions as
the Board of Directors considers appropriate in the circumstances.
13. Rights as a Shareholder.
-----------------------
The holder of an Option shall have no rights as a shareholder with
respect to any shares covered by the Option (including, without limitation, any
rights to receive dividends or non-cash distributions with respect to such
shares) until the date of issue of a stock certificate to him or her for such
shares. Except as Section 11 provides, no adjustment shall be made for
dividends or other rights for which the record date is prior to the date such
stock certificate is issued.
-12-
<PAGE>
14. No Special Employment Rights.
----------------------------
Nothing contained in the Plan or in any Option Agreement shall confer
upon any optionee any right with respect to the continuation of his or her
employment or service as a Director, consultant or otherwise by the Company or
interfere in any way with the right of the Company at any time to terminate such
employment or service or to increase or decrease the compensation of the
optionee.
15. Other Employee Benefits.
-----------------------
Except as to plans which by their terms include such amounts as
compensation, or as specifically determined by the Board of Directors, neither
the amount of any compensation deemed to be received by an optionee as a result
of the exercise of an Option, nor the sale of shares received by an optionee as
a result of the exercise of an Option nor the sale of shares received upon such
exercise will constitute compensation with respect to which any other employee
or fringe benefits of such optionee are determined, including, without
limitation, benefits under any bonus, pension, profit-sharing, life insurance or
salary continuation plan.
16. Withholding.
-----------
a. The Company shall have the right to deduct from payments of any
kind otherwise due to the optionee (or secure payment from the optionee in lieu
of such deduction) any federal, state or local taxes of any kind required by law
to be withheld with respect to any shares issued upon exercise of Options under
the Plan. Subject to the prior approval of the Company, which may be withheld
by the Company in its sole discretion, the optionee may elect to satisfy such
obligations, in whole or in part, (i) by causing the Company to withhold shares
of Common Stock otherwise issuable pursuant to the exercise of an option or (ii)
by delivering to the Company shares of Common Stock already owned by the
optionee. The Common Stock so delivered or withheld shall have a Fair Market
Value equal to such withholding obligation.
b. Notwithstanding the foregoing, in the case of an Officer, no
election to use shares for the payment of withholding taxes shall be effective
unless made in compliance with any applicable requirements of Rule 16b-3.
-13-
<PAGE>
17. Pooling Transactions.
--------------------
In the event of a Change in Control which also is intended to
constitute a Pooling Transaction, the Board of Directors shall take such
actions, if any, as are specifically recommended by an independent accounting
firm retained by Yurie to the extent reasonably necessary in order to assure
that the Pooling Transaction will qualify as such, including but not limited to
(i) deferring the vesting, exercise, payment, settlement of lapsing of
restrictions with respect to any Option, (ii) providing that the payment or
settlement in respect of any Option be made in the form of cash, shares or
securities of a successor or acquiror of Yurie, or a combination of the
foregoing, and (iii) providing for the extension of the Option Term to the
extent necessary to accommodate the foregoing.
18. Amendment and Termination of the Plan.
-------------------------------------
a. Except as set forth herein, the Board of Directors may at any
time, and from time to time, terminate the Plan or modify or amend the Plan in
any respect. To the extent that approval of the shareholders is required as to
such modification or amendment under Section 162(m)(4)(C) of the Code, the Board
of Directors may not effect such modification or amendment without such
approval.
b. The termination or any modification or amendment of the Plan
shall not, without the consent of an optionee, adversely affect his or her
rights under an Option previously granted to him or her. With the consent of
the optionee affected, the Board of Directors may amend outstanding Option
Agreements, in a manner not inconsistent with the Plan.
c. Notwithstanding Section 18(a) or (b): (i) neither the Plan nor
an Option Agreement may be amended to the extent the amendment would cause the
Plan or the Option Agreement to fail to satisfy the requirements of Rule 16b-3
or Section 162(m)(4)(C) of the Code (relating to performance-based
compensation); and (ii) the consent of an affected optionee will not be required
for amendment of an Option Agreement if the failure to amend would cause the
Option Agreement to fail to satisfy the requirements of Rule 16b-3 or Section
162(m)(4)(C) of the Code (relating to performance-based compensation).
-14-
<PAGE>
19. Effective Date and Duration of the Plan.
---------------------------------------
a. Effective Date. The Plan shall become effective when adopted by
--------------
the Board of Directors and approved by the shareholders, provided that Options
may be granted to employees after approval of the Plan by the Board of Directors
and prior to shareholder approval, subject to the requirement that shareholder
approval of the Plan be obtained within one year of approval by the Board. If
such shareholder approval is not obtained within one year, all Options granted
hereunder shall be null and void. Amendments requiring shareholder approval
shall become effective when adopted by the Board of Directors and approved by
the shareholders. Amendments to the Plan not requiring shareholder approval
shall become effective as of the date they are made effective by the Board of
Directors.
b. Duration. Unless sooner terminated in accordance with Section
--------
18, the Plan shall terminate upon the date on which all shares
available for issuance under the Plan shall have been issued
pursuant to the exercise or cancellation of options granted under
the Plan.
-15-
<PAGE>
Exhibit 5.1
July 29, 1997
(202) 639-7315
Board of Directors
Yurie Systems, Inc.
8301 Professional Place
Landover, Maryland 20785
Gentlemen:
We have acted as special counsel for Yurie Systems, Inc., a Delaware
corporation (the "Company"), in connection with the registration, pursuant to a
Registration Statement on Form S-8 (the "Registration Statement"), of an
additional 2,000,000 shares of the Company's common stock, par value $.01 per
share ("Common Stock"), issuable upon exercise of options which have been or may
be granted under the Company's Amended and Restated 1996 Non Statutory
Stock Option Plan (the "Option Plan"). On February 18, 1997 the Company had
filed a Registration Statement on Form S-8 covering 5,000,000 shares of Common
Stock issuable upon exercise of stock options granted under the Option Plan.
The additional 2,000,000 shares of Common Stock being registered under the
Registration Statement are referred to herein as the "Shares". This opinion is
delivered to you pursuant to Item 601(b)(5) of Regulation S-K under the
Securities Act of 1933, as amended. With your permission, all assumptions and
statements of reliance herein have been made without any independent
investigation or verification on our part except to the extent otherwise
expressly stated, and we express no opinion with respect to the subject matter
or accuracy of such assumptions or items relied upon.
In connection with this opinion, we have (i) investigated such
questions of law, (ii) examined originals or certified, conformed or
reproduction copies of such agreements, instruments, documents and records of
the Company, such certificates of public officials, and such other documents,
and (iii) reviewed such information from officers and representatives of the
Company and others as we have deemed necessary or appropriate for the purposes
of this opinion. We have examined, among other documents, the following:
<PAGE>
Board of Directors
July 25, 1997
Page 2
(a) The Option Plan;
(b) Form of Yurie Systems, Inc. Non-Statutory Stock Option Grant
Agreement; and
(c) Form of Yurie Systems, Inc. Directors Automatic Grant Agreement.
The documents referred to in items (a) through (c) above, inclusive,
are referred to herein collectively as the "Documents."
In all such examinations, we have assumed the legal capacity of all
natural persons executing Documents, the genuineness of all signatures, the
authenticity of original or certified documents, and the conformity to original
or certified documents of all copies submitted to us as conformed or
reproduction copies. As to various questions of fact relevant to the opinion
expressed herein, we have relied upon, and assume the accuracy of,
representations and warranties contained in the Documents and certificates and
oral or written statements and other information of or from public officials,
officers or other representatives of the Company, and others and assume
compliance on the part of all parties to the Documents with their covenants and
agreements contained therein. Insofar as statements herein are based upon our
knowledge, such phrase means and is limited to the conscious awareness of facts
or other information by lawyers in this firm who gave substantive attention to
representation of the Company in connection with the Documents.
Based upon the foregoing, and subject to the limitations,
qualifications and assumptions set forth herein, we are of the opinion that the
Shares, when issued and paid for (with the consideration received by the Company
being not less than the par value thereof) in accordance with the Option Plan
and any agreement applicable to such Shares, will be validly issued, fully paid
and non-assessable.
<PAGE>
Board of Directors
July 25, 1997
Page 3
The opinion expressed herein is limited to the General Corporation Law
of the State of Delaware, as currently in effect. The opinion expressed herein
is given as of the date hereof, and we undertake no obligation to supplement
this letter if any applicable laws change after the date hereof or if we become
aware of any facts that might change the opinion expressed herein after the date
hereof or for any other reason.
The opinion expressed herein is solely for your benefit and may not be
relied on in any manner or for any purpose by any other person or entity and may
not be quoted in whole or in part without our prior written consent.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement relating to the registration of the Shares. In giving
this consent, we do not admit that we are in the category of persons whose
consent is required under Section 7 of the Securities Act of 1933, as amended.
Very truly yours,
FRIED, FRANK, HARRIS, SHRIVER & JACOBSON
By: /s/ Stephen I. Glover
----------------------------
Stephen I. Glover
<PAGE>
Exhibit 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Yurie Systems, Inc. on Form S-8 of our report dated March 7, 1997 appearing in
the Annual Report on Form 10-K of Yurie Systems, Inc. for the year ended
December 31, 1996.
/s/ Deloitte & Touche LLP
Washington, DC.
July 28, 1997
<PAGE>
Exhibit 24.1.a
24.1.b
24.1.c
24.1.d
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that the persons whose signatures
appear below, constitute and appoint Jeong H. Kim, Harry J. Carr and Barton Y.
Shigemura, and each of them, as their true and lawful attorneys-in-fact and
agents, with full power of substitution and resubstitution, for them and in
their names, places, and steads, in any and all capacities, to sign the
Registration Statement on Form S-8 to be filed in connection with the
registration of up to 7,000,000 shares of the common stock par value $0.01 per
share of Yurie Systems, Inc. (the "Company") issued or issuable pursuant to the
Company's 1996 Amended and Restated Non Statutory Stock Option Plan and any and
all amendments (including post-effective amendments) to the Registration
Statement, and to file the same, with all exhibits thereto, and other documents
in connection therewith, with the Securities and Exchange Commission, granting
unto said attorneys-in-fact and agents, and each of them, full power and
authority to do and perform each and every act and thing requisite and necessary
to be done in connection therewith, as fully to all intents and purposes as they
might or could do in person, thereby ratifying and confirming all that said
attorneys-in-fact and agents, or any of them, or their or his or her substitute
or substitutes, may lawfully do or cause to be done by virtue hereof.
Dated: July 16, 1997
Signature
---------
/s/ Kenneth D. Brody /s/ William J. Perry
---------------------- -----------------------
Kenneth D. Brody William J. Perry
/s/ R. James Woolsey /s/ Herbert Rabin
---------------------- -----------------------
R. James Woolsey Herbert Rabin
