<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 21, 2000
REGISTRATION NO. 333-92097
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 3
TO
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
AVANEX CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
------------------------
<TABLE>
<S> <C> <C>
DELAWARE 3674 94-3285348
(STATE OR OTHER JURISDICTION OF (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NUMBER)
</TABLE>
40919 ENCYCLOPEDIA CIRCLE
FREMONT, CALIFORNIA 94538
(510) 897-4188
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
------------------------
WALTER ALESSANDRINI
CHIEF EXECUTIVE OFFICER
AVANEX CORPORATION
40919 ENCYCLOPEDIA CIRCLE
FREMONT, CALIFORNIA 94538
(510) 897-4188
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
------------------------
COPIES TO:
<TABLE>
<S> <C>
JUDITH M. O'BRIEN, ESQ. JEFFREY R. VETTER, ESQ.
ANN YVONNE WALKER, ESQ. SCOTT J. LEICHTNER, ESQ.
TERI A. LITTLE, ESQ. CYNTHIA E. GARABEDIAN, ESQ.
SHELDON J. QUAN, ESQ. FENWICK & WEST LLP
WILSON SONSINI GOODRICH & ROSATI TWO PALO ALTO SQUARE
PROFESSIONAL CORPORATION PALO ALTO, CALIFORNIA 94306
650 PAGE MILL ROAD (650) 494-0600
PALO ALTO, CALIFORNIA 94304
(650) 493-9300
</TABLE>
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
As soon as practicable after the effective date of this Registration Statement.
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. [ ]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL HEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SUCH SECTION 8(a),
MAY DETERMINE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 2
EXPLANATORY NOTE
This Amendment No. 3 to the Form S-1 Registration Statement is being filed
for the sole purpose of filing additional exhibits. The exhibit numbers are
10.35, 10.36 and 10.37.
<PAGE> 3
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the costs and expenses, other than
underwriting discounts and commissions, payable by Avanex Corporation in
connection with the sale of common stock being registered. All amounts are
estimates except the SEC registration fee and the NASD filing fee.
<TABLE>
<S> <C>
SEC registration fee........................................ $ 27,324.00
NASD filing fee............................................. $ 10,850.00
Nasdaq National Market listing fee.......................... $ 95,000.00
Printing and engraving costs................................ $ 200,000.00
Legal fees and expenses..................................... $ 500,000.00
Accounting fees and expenses................................ $ 525,000.00
Blue Sky fees and expenses.................................. $ 10,000.00
Directors and Officers Insurance............................ $ 620,000.00
Transfer Agent and Registrar fees........................... $ 10,000.00
Miscellaneous expenses...................................... $ 26,826.00
-------------
Total............................................. $2,025,000.00
=============
</TABLE>
ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware General Corporation Law permits a corporation
to include in its charter documents, and in agreements between the corporation
and its directors and officers, provisions expanding the scope of
indemnification beyond that specifically provided by the current law.
Article VIII of our amended and restated certificate of incorporation
provides for the indemnification of directors and officers to the fullest extent
permissible under Delaware law.
Article VI of our bylaws provides for the indemnification of officers,
directors and third parties acting on behalf of Avanex if such person acted in
good faith and in a manner reasonably believed to be in and not opposed to our
best interest, and, with respect to any criminal action or proceeding, the
indemnified party had no reason to believe his or her conduct was unlawful.
We have entered into indemnification agreements with our directors and
executive officers, in addition to indemnification provided for in our bylaws,
and intend to enter into indemnification agreements with any new directors and
executive officers in the future. The indemnification agreements may require us,
among other things, to indemnify our directors and officers against certain
liability that may arise by reason of their status or service as directors and
officers (other than liabilities arising from willful misconduct of a culpable
nature), to advance their expenses incurred as a result of any proceeding
against them as to which they could be indemnified, and to obtain directors and
officers' insurance, if available on reasonable terms.
Reference is also made to Section 7 of the form of Underwriting Agreement
contained in Exhibit 1.1 hereto, indemnifying officers and directors of Avanex
against certain liabilities.
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES
Since inception, we have issued unregistered securities to a limited number
of persons, as described below. None of these transactions involved any
underwriters, underwriting discounts or commissions, or any public offering, and
we believe that each transaction was exempt from the registration requirements
of the Securities Act by virtue of Section 4(2) thereof, Regulation D
promulgated thereunder or Rule 701 pursuant to compensatory benefit plans and
contracts relating to compensation as provided under such Rule 701. The
recipients of securities in each such transaction represented their intention to
acquire the securities for investment only and not with a view to or for sale in
connection with any distribution thereof, and appropriate
II-1
<PAGE> 4
legends were affixed to the share certificates and instruments issued in such
transactions. All recipients had adequate access, through their relationships
with us, to information about us.
(1) From inception through December 31, 1999, (the most recent practicable
date) we granted stock options and restricted stock purchase rights to
acquire an aggregate of 15,731,832 shares of our common stock at
prices ranging from $0.001 to $6.50 to employees, consultants and
directors pursuant to our 1998 Stock Plan, as amended.
(2) From inception through December 31, 1999, we issued an aggregate of
13,311,320 shares of our common stock to employees, consultants and
directors pursuant to the exercise of options and restricted stock
purchase rights granted under our 1998 Stock Plan, as amended, for
aggregate consideration of $2,444,671.54.
(3) On January 13, 1998, we sold 1,800,000 shares of common stock to an
employee in exchange for $1,000.00 in cash and $800.00 in transferred
technology.
(4) On February 10, 1998, we sold 4,530,080 shares of Series A Preferred
Stock for $0.223 per share to a group of private investors for an
aggregate purchase price of $1,010,208.
(5) On February 19, 1998, we granted a right to purchase an aggregate of
200,000 shares of common stock to a consultant in consideration for
past services rendered for an aggregate value of $1,000.00.
(6) On June 29, 1998, we sold 6,296,744 shares of Series B Preferred Stock
for $0.40 per share to a group of private investors for an aggregate
purchase price of $2,518,698.
(7) On December 31, 1998, we issued warrants to purchase 75,000 shares of
our common stock at an exercise price of $6.00 a share to each of
Simon Cao, Haiguang Lu, and Lee Wang.
(8) On February 19, 1999 and March 25, 1999, we sold 9,032,169 shares of
Series C Preferred Stock for $0.756 per share to a group of private
investors for an aggregate purchase price of $6,828,320.
(9) On July 8, 1999, in connection with a Revolving Credit and Security
Agreement, we issued a warrant to purchase 19,565 shares of Series D
Preferred Stock at an exercise price of $5.75 to Comerica
Incorporated.
(10) On September 14 and October 15, 1999, we sold 3,487,097 shares of
Series D Preferred Stock for $5.75 per share to a group of private
investors for an aggregate purchase price of $20,050,807.75.
(11) On October 8, 1999, we granted under our 1998 Stock Plan, as amended,
a right to purchase an aggregate of 4,000 shares of common stock to a
consultant in consideration of past services rendered for an aggregate
value of $2,320.00.
(12) On December 10, 1999, we granted under our 1998 Stock Plan, as
amended, rights to purchase an aggregate of 60,000 shares of common
stock to consultants in consideration of past services rendered for an
aggregate value of $300,000.00.
(13) On January 14, 2000 we agreed to sell 769,230 shares of common stock
to corporate investors for an aggregate purchase price of
$9,999,990.00.
For additional information concerning these equity investment transactions,
reference is made to the information contained under the caption "Certain
Transactions" in the form of prospectus included herein.
II-2
<PAGE> 5
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(A) EXHIBITS
<TABLE>
<C> <S>
1.1++ Form of Underwriting Agreement
2.1++ Agreement and Plan of Merger of Avanex Corporation (a
Delaware Corporation) and Avanex Corporation (a California
Corporation)
3.1++ Amended and Restated Certificate of Incorporation to be
filed , 2000
3.2++ Amended and Restated Bylaws of the Registrant
3.3++ Amended and Restated Certificate of Incorporation to be
filed after effectiveness of this Registration Statement
filed , 2000
4.1++ Specimen Common Stock Certificate
4.3++ Warrant to Purchase the Stock of the Registrant held by
Comerica Incorporated
4.4++ Warrants to Purchase the Stock of the Registrant held by Lee
Wang, Haiguang Lu, and Simin Cai
5.1++ Opinion of Wilson Sonsini Goodrich & Rosati, Professional
Corporation
10.1++ Form of Indemnification Agreement between Registrant and
each of its directors and officers
10.2++ 1998 Stock Plan, as amended, and forms of agreement
thereunder
10.3++ 1999 Employee Stock Purchase Plan
10.4++ 1999 Director Option Plan
10.5++ Founder's Stock Purchase Agreement between the Registrant
and Simon Xiaofan Cao dated January 13, 1998
10.6++ Restricted Stock Purchase Agreement, including Security
Agreement and Promissory Note, between the Registrant and
Walter Alessandrini dated October 8, 1999
10.7++ Restricted Stock Purchase Agreement, including Security
Agreement and Promissory Note, between the Registrant and
Walter Alessandrini dated March 26, 1999
10.8++ Form of Restricted Stock Purchase Agreement
10.8.1++ Stock Purchase Agreement, including Security Agreement and
Promissory Note, between the Registrant and Paul Shi-Qi
Jiang dated July 22, 1999
10.8.2++ Restricted Stock Purchase Agreement, including Security
Agreement and Promissory Note, between the Registrant and
Simon Xiaofan Cao dated August 4, 1999
10.8.3++ Restricted Stock Purchase Agreement, including Security
Agreement and Promissory Note, between the Registrant and
Peter Maguire dated August 4, 1999
10.8.4++ Restricted Stock Purchase Agreement, including Security
Agreement and Promissory Note, between the Registrant and
James Pickering dated September 10, 1999
10.8.5++ Restricted Stock Purchase Agreement, including Security
Agreement and Promissory Note, between the Registrant and
Margaret Quinn dated October 8, 1999
10.8.6++ Restricted Stock Purchase Agreement, including Security
Agreement and Promissory Note, between the Registrant and
Simon Xiaofan Cao dated October 12, 1999
10.8.7++ Restricted Stock Purchase Agreement, including Security
Agreement and Promissory Note, between the Registrant and
Anthony Florence dated November 19, 1999
10.8.8++ Restricted Stock Purchase Agreement, including Security
Agreement and Promissory Note, between the Registrant and
Jessy Chao dated November 26, 1999
</TABLE>
II-3
<PAGE> 6
<TABLE>
<C> <S>
10.8.9++ Restricted Stock Purchase Agreement, including Security
Agreement and Promissory Note, between the Registrant and
Paul Shi-Qi Jiang dated November 26, 1999
10.8.10++ Stock Option Agreement, and accompanying exhibits, between
the Registrant and Jessy Chao dated February 3, 1998
10.8.11++ Stock Option Agreement, and accompanying exhibits, between
the Registrant and Paul Shi-Qi Jiang dated February 3, 1998
10.8.12++ Form of Stock Option Agreements between the Registrant and
certain directors
10.8.13++ Schedule of directors receiving stock options of the
Registrant
10.9++ Series A Preferred, Series B Preferred and Series C
Preferred Stock Purchase Agreement dated February 10, 1998
10.10++ First Amended and Restated Series A Preferred, Series B
Preferred, and Series C Preferred Stock Purchase Agreement
dated February 19, 1999
10.11++ Series D Preferred Stock Purchase Agreement dated September
14, 1999
10.12++ Second Amended and Restated Co-Sale Agreement dated
September 14, 1999
10.12.1++ Second Amended and Restated Voting Agreement dated September
14, 1999
10.12.2++ Second Amended and Restated Shareholder Rights Agreement
dated September 14, 1999
10.13++ Revolving Credit and Security Agreement between Comerica
Bank-California and the Registrant dated July 8, 1999
10.14++ Quick Start Loan and Security Agreement between Silicon
Valley Bank and the Registrant dated February 17, 1998
10.15++ Senior Loan and Security Agreement No. 053-6193 between
Phoenix Leasing Incorporated and the Registrant dated
November 5, 1998
10.16++ Master Lease No. S7280 dated June 2, 1999, between Finova
Capital Corporation and the Registrant
10.17++ Security Agreement dated September 16, 1999 between Comerica
Bank-California and the Registrant
10.18++ Employment Letter between the Registrant and Walter
Alessandrini dated March 2, 1999
10.19++ Secured Promissory Note held by the Registrant for Walter
Alessandrini dated May 20, 1999 and amendment to the Secured
Promissory Note dated December 1, 1999
10.20++ Employment Letter between the Registrant and Simon Cao dated
January 2, 1998
10.21++ Employment Letter between the Registrant and Paul Jiang
dated January 2, 1998
10.22++ Employment Agreement between the Registrant and William
Lanfri dated July 1, 1998
10.23++ Employment Letter between the Registrant and Peter Maguire
dated June 18, 1999
10.24*++ Patent License Agreement between Fujitsu Limited and the
Registrant dated July 15, 1998
10.24.1*++ Letter clarifying the Patent License Agreement between
Fujitsu Limited and the Registrant dated July 1, 1998
10.25++ Lease between the Registrant and Stevenson Business Park LLC
for Building B of 40915 Encyclopedia Circle, Fremont,
California dated September 8, 1999
10.26++ Assignment of Sublease between Registrant and Pathnet for
405 International Parkway, Richardson, Texas dated September
17, 1998
10.26.1++ Sublease between KLA-Tencor Corporation and Pathnet, Inc.
for 405 International Parkway, Richardson, Texas dated
October 16, 1997
</TABLE>
II-4
<PAGE> 7
<TABLE>
<S> <C>
10.27++ Amendment to Sublease for 405 International Parkway, Richardson, Texas dated January 1998
10.28++ Master Lease for 405 International Parkway, Richardson, Texas dated January 1, 1990
10.29++ Intellectual Property Security Agreement between Registrant and Comerica Bank-California
dated July 8, 1999
10.30*++ License and Supply Agreement between Registrant and Concord Micro-Optics, Inc. dated May
24, 1999
10.31*++ International Distributor Agreement between the Registrant and Hakuto Co., Ltd. dated
November 1999
10.32++ Professional Services Agreement between the Registrant and AristaSoft Corporation dated
July 7, 1999
10.33++ Cost Sharing Agreement between the Registrant and Avanex Cayman dated December, 1999
10.34*++ International Distributor Agreement between the Registrant and Sun Instruments dated
December 20, 1999
10.35 Subscription Agreement between the Registrant and Microsoft Corporation dated January 14,
2000
10.36 Subscription Agreement between the Registrant and MCI Worldcom Venture Fund dated January
14, 2000
10.37 Third Amended and Restated Shareholder Rights Agreement dated January 14, 2000
21.1++ List of subsidiaries of the Registrant
23.1 Consent of Ernst & Young LLP, Independent Auditors
23.2++ Consent of Counsel (See Exhibit 5.1)
24.1++ Power of Attorney (See page II-7)
27.1++ Financial Data Schedule for six months ended December 31, 1999
27.2++ Financial Data Schedule for the year ended June 30, 1999
27.3++ Financial Data Schedule for the period from October 24, 1997 (inception) to June 30, 1998
</TABLE>
- -------------
* Confidential treatment requested.
++ Previously filed.
(b) FINANCIAL STATEMENT SCHEDULES
Schedules not listed above have been omitted because they are not
applicable or are not required or the information required to be set forth
therein is included in the consolidated financial statements or notes thereto.
ITEM 17. UNDERTAKINGS
We hereby undertake to provide to the Underwriters at the closing specified
in the Underwriting Agreement certificates in such denominations and registered
in such names as required by the Underwriters to permit prompt delivery to each
purchaser.
Insofar as indemnification by the Registrant for liabilities arising under
the Securities Act may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the provisions referenced in Item 14 of
this Registration Statement or otherwise, the Registrant has been advised that
in the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Securities Act, and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer, or
II-5
<PAGE> 8
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by director, officer or controlling person in
connection with the securities being registered hereunder, the Registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
We hereby undertake that:
(1) For purposes of determining any liability under the Securities
Act, the information omitted from the form of Prospectus filed as part of
this Registration Statement in reliance upon Rule 430A and contained in a
form of Prospectus filed by the Registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
Registration Statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act, each post-effective amendment that contains a form of Prospectus shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
II-6
<PAGE> 9
SIGNATURES
Pursuant to the requirements of the Securities Act, the Registrant has duly
caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Fremont, State of
California, on the 21st day of January, 2000.
AVANEX CORPORATION
By: /s/ SIMON XIAOFAN CAO
------------------------------------
Simon Xiaofan Cao
Senior Vice President, Product
Development
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ WALTER ALESSANDRINI* President and Chief Executive January 21, 2000
- ------------------------------------------------ Officer (Principal Executive
Walter Alessandrini Officer) and Director
/s/ JESSY CHAO* Vice President, Finance and Chief January 21, 2000
- ------------------------------------------------ Financial Officer (Principal
Jessy Chao Financial and Accounting Officer)
/s/ SIMON XIAOFAN CAO Senior Vice President, Product January 21, 2000
- ------------------------------------------------ Development and Director
Simon Xiaofan Cao
/s/ TODD BROOKS* Director January 21, 2000
- ------------------------------------------------
Todd Brooks
/s/ MICHAEL GOGUEN* Director January 21, 2000
- ------------------------------------------------
Michael Goguen
/s/ SETH NEIMAN* Director January 21, 2000
- ------------------------------------------------
Seth Neiman
/s/ VINT CERF* Director January 21, 2000
- ------------------------------------------------
Vint Cerf
/s/ JOEL SMITH* Director January 21, 2000
- ------------------------------------------------
Joel Smith
/s/ FEDERICO FAGGIN* Director January 21, 2000
- ------------------------------------------------
Federico Faggin
/s/ GREGORY REYES, JR.* Director January 21, 2000
- ------------------------------------------------
Gregory Reyes, Jr.
*By: /s/ BRIAN KINARD Attorney-in-fact January 21, 2000
------------------------------------------
Brian Kinard
</TABLE>
II-7
<PAGE> 10
EXHIBIT INDEX
<TABLE>
<CAPTION>
NUMBER DESCRIPTION
------ -----------
<C> <S>
1.1++ Form of Underwriting Agreement
2.1++ Agreement and Plan of Merger of Avanex Corporation (a
Delaware Corporation) and Avanex Corporation (a California
Corporation)
3.1++ Amended and Restated Certificate of Incorporation to be
filed , 2000
3.2++ Amended and Restated Bylaws of the Registrant
3.3++ Amended and Restated Certificate of Incorporation to be
filed after effectiveness of this Registration Statement
filed , 2000
4.1++ Specimen Common Stock Certificate
4.3++ Warrant to Purchase the Stock of the Registrant held by
Comerica Incorporated
4.4++ Warrants to Purchase the Stock of the Registrant held by Lee
Wang, Haiguang Lu, and Simin Cai
5.1++ Opinion of Wilson Sonsini Goodrich & Rosati, Professional
Corporation
10.1++ Form of Indemnification Agreement between Registrant and
each of its directors and officers
10.2++ 1998 Stock Plan, as amended, and forms of agreement
thereunder
10.3++ 1999 Employee Stock Purchase Plan
10.4++ 1999 Director Option Plan
10.5++ Founder's Stock Purchase Agreement between the Registrant
and Simon Xiaofan Cao dated January 13, 1998
10.6++ Restricted Stock Purchase Agreement, including Security
Agreement and Promissory Note, between the Registrant and
Walter Alessandrini dated October 8, 1999
10.7++ Restricted Stock Purchase Agreement, including Security
Agreement and Promissory Note, between the Registrant and
Walter Alessandrini dated March 26, 1999
10.8++ Form of Restricted Stock Purchase Agreement
10.8.1++ Stock Purchase Agreement, including Security Agreement and
Promissory Note, between the Registrant and Paul Shi-Qi
Jiang dated July 22, 1999
10.8.2++ Restricted Stock Purchase Agreement, including Security
Agreement and Promissory Note, between the Registrant and
Simon Xiaofan Cao dated August 4, 1999
10.8.3++ Restricted Stock Purchase Agreement, including Security
Agreement and Promissory Note, between the Registrant and
Peter Maguire dated August 4, 1999
10.8.4++ Restricted Stock Purchase Agreement, including Security
Agreement and Promissory Note, between the Registrant and
James Pickering dated September 10, 1999
10.8.5++ Restricted Stock Purchase Agreement, including Security
Agreement and Promissory Note, between the Registrant and
Margaret Quinn dated October 8, 1999
10.8.6++ Restricted Stock Purchase Agreement, including Security
Agreement and Promissory Note, between the Registrant and
Simon Xiaofan Cao dated October 12, 1999
10.8.7++ Restricted Stock Purchase Agreement, including Security
Agreement and Promissory Note, between the Registrant and
Anthony Florence dated November 19, 1999
10.8.8++ Restricted Stock Purchase Agreement, including Security
Agreement and Promissory Note, between the Registrant and
Jessy Chao dated November 26, 1999
</TABLE>
<PAGE> 11
<TABLE>
<CAPTION>
NUMBER DESCRIPTION
------ -----------
<C> <S>
10.8.9++ Restricted Stock Purchase Agreement, including Security
Agreement and Promissory Note, between the Registrant and
Paul Shi-Qi Jiang dated November 26, 1999
10.8.10++ Stock Option Agreement, and accompanying exhibits, between
the Registrant and Jessy Chao dated February 3, 1998
10.8.11++ Stock Option Agreement, and accompanying exhibits, between
the Registrant and Paul Shi-Qi Jiang dated February 3, 1998
10.8.12++ Form of Stock Option Agreements between the Registrant and
certain directors
10.8.13++ Schedule of directors receiving stock options of the
Registrant
10.9++ Series A Preferred, Series B Preferred and Series C
Preferred Stock Purchase Agreement dated February 10, 1998
10.10++ First Amended and Restated Series A Preferred, Series B
Preferred, and Series C Preferred Stock Purchase Agreement
dated February 19, 1999
10.11++ Series D Preferred Stock Purchase Agreement dated September
14, 1999
10.12++ Second Amended and Restated Co-Sale Agreement dated
September 14, 1999
10.12.1++ Second Amended and Restated Voting Agreement dated September
14, 1999
10.12.2++ Second Amended and Restated Shareholder Rights Agreement
dated September 14, 1999
10.13++ Revolving Credit and Security Agreement between Comerica
Bank-California and the Registrant dated July 8, 1999
10.14++ Quick Start Loan and Security Agreement between Silicon
Valley Bank and the Registrant dated February 17, 1998
10.15++ Senior Loan and Security Agreement No. 053-6193 between
Phoenix Leasing Incorporated and the Registrant dated
November 5, 1998
10.16++ Master Lease No. S7280 dated June 2, 1999, between Finova
Capital Corporation and the Registrant
10.17++ Security Agreement dated September 16, 1999 between Comerica
Bank-California and the Registrant
10.18++ Employment Letter between the Registrant and Walter
Alessandrini dated March 2, 1999
10.19++ Secured Promissory Note held by the Registrant for Walter
Alessandrini dated May 20, 1999 and amendment to the Secured
Promissory Note dated December 1, 1999
10.20++ Employment Letter between the Registrant and Simon Cao dated
January 2, 1998
10.21++ Employment Letter between the Registrant and Paul Jiang
dated January 2, 1998
10.22++ Employment Agreement between the Registrant and William
Lanfri dated July 1, 1998
10.23++ Employment Letter between the Registrant and Peter Maguire
dated June 18, 1999
10.24*++ Patent License Agreement between Fujitsu Limited and the
Registrant dated July 15, 1998
10.24.1*++ Letter clarifying the Patent License Agreement between
Fujitsu Limited and the Registrant dated July 1, 1998
10.25++ Lease between the Registrant and Stevenson Business Park LLC
for Building B of 40915 Encyclopedia Circle, Fremont,
California dated September 8, 1999
10.26++ Assignment of Sublease between Registrant and Pathnet for
405 International Parkway, Richardson, Texas dated September
17, 1998
10.26.1++ Sublease between KLA-Tencor Corporation and Pathnet, Inc.
for 405 International Parkway, Richardson, Texas dated
October 16, 1997
</TABLE>
<PAGE> 12
<TABLE>
<CAPTION>
NUMBER DESCRIPTION
------ -----------
<C> <S>
10.27++ Amendment to Sublease for 405 International Parkway,
Richardson, Texas dated January 1998
10.28++ Master Lease for 405 International Parkway, Richardson,
Texas dated January 1, 1990
10.29++ Intellectual Property Security Agreement between Registrant
and Comerica Bank-California dated July 8, 1999
10.30*++ License and Supply Agreement between Registrant and Concord
Micro-Optics, Inc. dated May 24, 1999
10.31*++ International Distributor Agreement between the Registrant
and Hakuto Co., Ltd. dated November 1999
10.32++ Professional Services Agreement between the Registrant and
AristaSoft Corporation dated July 7, 1999
10.33++ Cost Sharing Agreement between the Registrant and Avanex
Cayman dated December, 1999
10.34*++ International Distributor Agreement between the Registrant
and Sun Instruments dated December 20, 1999
10.35 Subscription Agreement between the Registrant and Microsoft
Corporation dated January 14, 2000
10.36 Subscription Agreement between the Registrant and MCI
Worldcom Venture Fund dated January 14, 2000
10.37 Third Amended and Restated Shareholder Rights Agreement
dated January 14, 2000
21.1++ List of subsidiaries of the Registrant
23.1 Consent of Ernst & Young LLP, Independent Auditors
23.2++ Consent of Counsel (See Exhibit 5.1)
24.1++ Power of Attorney (See page II-7)
27.1++ Financial Data Schedule for six months ended December 31,
1999
27.2++ Financial Data Schedule for the year ended June 30, 1999
27.3++ Financial Data Schedule for the period from October 24, 1997
(inception) to June 30, 1998
</TABLE>
- -------------
* Confidential treatment requested.
++ Previously filed.
<PAGE> 1
EXHIBIT 10.35
SUBSCRIPTION AGREEMENT
TO: AVANEX CORPORATION
RE: SUBSCRIPTION FOR AND PURCHASE OF SHARES OF COMMON STOCK
1. SUBSCRIPTION
Microsoft Corporation (the "PURCHASER") hereby irrevocably subscribes for
and agrees to purchase, on and subject to the terms and conditions set forth
herein, from Avanex Corporation, a California corporation (the "CORPORATION"),
three hundred eighty-four thousand six hundred fifteen (384,615) shares of
Common Stock of the Corporation (the "SHARES") at a price of $13.00 per share,
having the voting powers, designations, preferences, rights and qualifications
set forth in the Corporation's Restated Certificate of Incorporation, which is
attached hereto as Exhibit "A" (the "RESTATED CERTIFICATE") which is the form of
the Corporation's certificate of incorporation that will govern the Corporation
upon the closing of the Corporation's initial public offering (the "IPO").
Purchaser hereby acknowledges that the Corporation is currently incorporated in
California and is undertaking a reincorporation in Delaware. In connection
therewith, each holder of two shares of capital stock of the California
corporation will receive three shares of the Delaware corporation (the "3-FOR-2
SPLIT"). THE NUMBER OF SHARES SUBSCRIBED FOR HEREIN AND THE SUBSCRIPTION PRICE
(AS DEFINED BELOW) GIVE EFFECT TO THE 3-FOR-2 SPLIT.
2. PAYMENT
At Closing, as defined below, the aggregate purchase price for the Shares,
$4,999,995 (the "SUBSCRIPTION PRICE"), shall be paid by wire transfer to the
following account: Coamerica Bank, 55 Almaden Blvd., 2nd Floor, San Jose,
California 95113: ABA No. 121137522; Account No. 1891190538.
3. DOCUMENTS TO BE PROVIDED BY PURCHASER
The Purchaser must complete, sign and return as soon as possible, two
executed copies of each of this Subscription Agreement and the Third Amended and
Restated Registration Rights Agreement attached hereto as Exhibit "B"(the
"RIGHTS AGREEMENT").
4. CLOSING AND DELIVERY OF SHARE CERTIFICATES
Delivery and payment for the Shares will be completed in one closing (the
"CLOSING") at the offices of Wilson Sonsini Goodrich & Rosati, 650 Page Mill
Road, Palo Alto, California at 8:00 a.m. (Pacific Daylight Time) (the "CLOSING
Time") on such date as the Corporation and the Purchaser may agree (the "CLOSING
DATE"), but in any event not later than February 15, 2000 (unless extended by
mutual agreement of the Corporation and the Purchaser).
<PAGE> 2
A certificate representing the Shares (the "CERTIFICATE") will be
delivered at Closing against payment to the Corporation of the Subscription
Price in the manner specified in Paragraph 2 above.
5. CONDITIONS TO CLOSING OF THE PURCHASER
The Purchaser's obligation to purchase the Shares at the Closing is, at the
option of the Purchaser, subject to fulfillment on or prior to the Closing Date
of the following conditions:
5.1 Rights Agreement. The Corporation shall have executed and delivered to
the Purchaser the Rights Agreement.
5.2 Subscription Agreement. The Corporation shall have executed and
delivered to the Purchaser a copy of this Subscription Agreement.
5.3 Registration Statement. The registration statement filed with the
Securities and Exchange Commission in connection with the Corporation's initial
offering of its securities to the public shall have been declared effective.
6. CONDITIONS TO CLOSING OF THE CORPORATION
The Corporation's obligation to issue and sell the Shares at the Closing to
the Purchaser is, at the option of the Corporation, subject to the fulfillment
of the following conditions:
6.1 Representations and Warranties. The representations and warranties
made by the Purchaser in Section 9 hereof shall be true and correct when made,
and shall be true and correct on the Closing Date with the same force and effect
as if such representations had been made on and as of said date.
6.2 Subscription Agreement. The Purchaser shall have executed and
delivered to the Corporation a copy of this Subscription Agreement.
6.3 Payment. The Corporation shall have received from the Purchaser
payment in full for the Subscription Price.
6.4 Rights Agreement. The Purchaser shall have executed and delivered the
Rights Agreement to the Corporation.
6.5 Lockup Agreement: The Purchaser shall have executed and delivered a
Lockup Agreement with the Corporation's underwriters in the form of Exhibit "C"
hereto.
7. REPRESENTATIONS AND WARRANTIES OF THE CORPORATION
The Corporation hereby represents and warrants to the Purchaser that,
except as otherwise set forth on Exhibit "D" hereto, with specific reference to
the subsection of this Section 7 so affected,
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<PAGE> 3
the following will be true and correct as of the Closing Date (except for the
representation contained in Section 7.3, which is true as of the date hereof):
7.1 Organization and Standing. The Corporation is a corporation duly
organized and validly existing under, and by virtue of, the laws of the State of
California and is in good standing under such laws. The Corporation has the
requisite corporate power to own and operate its properties and assets and to
carry on its business as presently conducted.
7.2 Corporate Power. The Corporation has all requisite legal and corporate
power to execute and deliver this Subscription Agreement and the Rights
Agreement, to sell and issue the Shares hereunder and to carry out and perform
its obligations under the terms of this Subscription Agreement and the Rights
Agreement.
7.3 Capitalization. Giving effect to the stock split effected in
connection with the Corporation's reincorporation into Delaware, the authorized
capital stock of the Corporation consists of 300,000,000 shares of Common Stock,
20,403,456 of which are issued and outstanding and 38,100,000 shares of
Preferred Stock. As of the date hereof, 6,900,000 shares of Preferred Stock have
been designated Series A Preferred, 6,795,120 of which are issued and
outstanding; 9,525,000 shares of Preferred Stock have been designated Series B
Preferred, 9,445,116 of which are issued and outstanding; 16,275,000 shares of
Preferred Stock have been designated Series C Preferred, 13,548,253 of which are
issued and outstanding; and 5,400,000 shares of Preferred Stock have been
designated Series D Preferred, 5,230,646 of which are issued and outstanding.
Effective with the Closing of the IPO, all outstanding Preferred Stock will
convert to Common Stack at a rate of one share of Common Stock for each share of
Preferred Stock. Simultaneously therewith, the Corporation shall file the
Restated Certificate with the Secretary of State of Delaware and the authorized
capital stock of the Company shall consist of 300,000,000 shares of Common
Stock, of which 55,422,591 will be outstanding (assuming (i) no exercise of
options or warrants after December 31, 1999, (ii) the issuance of 6,000,000
shares of Common Stock in the Corporation's IPO, and (iii) no exercise of the
underwriter's over-allotment option in connection with the IPO) and 10,000,000
shares of Preferred Stock, none of which shall be outstanding. The Common Stock
and Preferred Stock have the voting power, designations, preferences, rights and
qualifications set forth in the Restated Certificate. As of December 31, 1999,
except as contemplated herein and except for: (i) the pre-emptive rights granted
pursuant to the Rights Agreement, (ii) options to purchase 3,401,427 shares of
Common Stock of the Corporation granted under its 1998 Stock Plan, and (iii)
warrants to purchase a total of up to 337,500 shares of Common Stock and 29,347
shares of Series D Preferred Stock, there are no options, warrants, conversion
privileges or other rights presently outstanding to purchase or otherwise
acquire any authorized but unissued shares of the capital stock or other
securities of the Corporation, nor any agreements or understandings with respect
thereto.
7.4 Financial Statements. As of the Closing Date, the Corporation will
have delivered to the Purchaser the audited financial statements of the
Corporation as of December 31, 1999 (the "FINANCIAL STATEMENTS"). The Financial
Statements, together with the notes thereto, are complete and correct in all
material respects, have been prepared in accordance with generally accepted
accounting principles consistently applied throughout the periods covered
thereby, and present fairly the financial position of the Corporation as of
their respective dates. Other than as
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<PAGE> 4
described in the Financial Statements, the Corporation has no material
liabilities and knows of no material contingent liabilities not disclosed in the
Financial Statements, except current liabilities incurred in the ordinary course
of business which are not, individually or in the aggregate, materially adverse.
7.5 Authorization. All corporate action on the part of the Corporation,
its directors and stockholders necessary for the authorization, execution,
delivery and performance of this Agreement and the Rights Agreement, the
authorization, sale, issuance and delivery of the Shares and the performance of
the Corporation's obligations hereunder and thereunder has been taken or will be
taken prior to the Closing. This Agreement and the Rights Agreement when fully
executed and delivered by the Corporation, shall constitute valid and binding
obligations of the Corporation, enforceable in accordance with their respective
terms, subject to laws of general application relating to bankruptcy, insolvency
and the relief of debtors and rules of law governing specific performance,
injunctive relief or other equitable remedies. The Shares, when issued in
compliance with the provisions of this Agreement, will be validly issued, fully
paid and non-assessable, and free of any liens or encumbrances; provided,
however, that the Shares may be subject to certain restrictions on transfer
under applicable state and/or Federal securities laws.
7.6 Governmental Consents, etc. No consent, approval or authorization of
or designation, declaration or filing with any state or federal governmental
authority on the part of the Corporation is required in connection with the
valid execution and delivery of this Agreement, the Rights Agreement or the
offer, sale or issuance of the Shares, or the consummation of any other
transaction contemplated hereby, except qualification (or taking such action as
may be necessary to secure an exemption from qualification, if available) under
the California Corporate Securities Law and other applicable blue sky laws, of
the offer and sale of the Shares, which filing and qualification, if required,
will be accomplished in a timely manner prior to or promptly after the Closing.
7.7 Registration Rights. At the closing, except as set forth in the Rights
Agreement, the Corporation will not be under any obligation to register any of
its presently outstanding securities, or any of its securities which may
hereafter be issued, under the Securities Act of 1933, as amended (the
"SECURITIES ACT").
7.8 Brokers or Finders. The Corporation has not incurred, and will not
incur, directly or indirectly, any liability for brokerage or finders' fees or
agents' commissions or any similar charges in connection with this Agreement or
any transaction contemplated hereby.
7.9 No Conflict. The offer and sale of the Shares by the Corporation and
the performance and consummation of the transactions contemplated herein will
not conflict with or result in (i) a breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement (written or oral) or instrument to
which the Corporation is bound or to which any of the property or assets of the
Corporation is subject, which breach or violation or the consequences thereof
would result in a Material Adverse Effect, (ii) any violation of the provisions
of the Restated Certificate, the by-laws or any resolutions of the Corporation
or (iii) to the Corporation's knowledge a violation of any statute or any order,
rule or regulation of any court or governmental agency or body having
jurisdiction over the Corporation or
-4-
<PAGE> 5
any of its assets or properties, which violation or the consequences thereof
would result in a Material Adverse Effect.
8. CERTAIN MATTERS RELATING TO THE OFFER AND SALE OF THE SHARES
The Purchaser acknowledges and agrees that: (i) it has not been provided
with a registration statement, prospectus or any similar document in connection
with its purchase of the Shares and (ii) its decision to execute this Agreement
and the Rights Agreement and to purchase the Shares has not been based upon any
verbal or written representations as to fact or otherwise made by or on behalf
of the Corporation and that its decision is based upon the information,
representations and covenants of the Corporation contained in this Agreement,
its own review of certain of the Corporation's documents and records, and
publicly available information concerning the Corporation.
9. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASER
The Purchaser hereby represents, warrants and covenants to the Corporation
(which representations, warranties and covenants shall survive the Closing) as
of the date hereof and as of the Closing Date as follows:
9.1 Experience; Risk. The Purchaser has such knowledge and experience in
financial and business matters that it is capable of evaluating the merits and
risks of the purchase of the Shares pursuant to this Agreement and is capable of
protecting its interests in connection herewith. The Purchaser has the ability
to bear the economic risk of the investment, including complete loss of the
investment.
9.2 Investment. The Purchaser is acquiring the Shares for investment for
its own account, not as a nominee or agent, and not with a view to, or for,
resale in connection with any distribution thereof, and the Purchaser has no
present intention to sell, grant any participation in, or otherwise distribute
the Shares. The Purchaser understands that the Shares have not been registered
under the Securities Act and will be issued pursuant to an exemption from the
registration requirements thereof, which exemption depends upon, among other
things, the bona fide nature of the investment intent and the accuracy of such
Purchaser's representations as expressed herein.
9.3 Rule 144. The Purchaser understands that the Shares are "restricted
securities" under Federal securities laws, as they are unregistered and are
being acquired from the Corporation in a transaction not involving a public
offering, and that under such laws and applicable regulations promulgated
thereunder the Shares may be resold without registration under the Securities
Act only in certain limited circumstances. The Purchaser acknowledges that the
Shares must be held indefinitely unless subsequently registered under the
Securities Act or an exemption from such registration is available. The
Purchaser is aware of the provisions of Rule 144 promulgated under the
Securities Act, the provisions of which limit resale of "restricted securities."
-5-
<PAGE> 6
9.4 No Public Market. The Purchaser understands that no public market now
exists for the Shares or for any other securities issued by the Corporation and
that there is no assurance that a public market will ever exist for the Shares.
9.5 Authorization.
(a) The Purchaser has the full right, power and authority to enter
into and perform its obligations under this Agreement and the Rights Agreement.
This Agreement and the Rights Agreement when executed and delivered by the
Purchaser, will constitute valid and binding obligations of the Purchaser,
enforceable in accordance with their respective terms, subject to the laws of
general application relating to bankruptcy, insolvency and the relief of
debtors, rules of law governing specific performance, injunctive relief and
other equitable remedies.
(b) The Purchaser further represents that it is a validly existing
corporation, has the necessary corporate capacity and authority to execute and
deliver this Agreement and to observe and perform its covenants and obligations
hereunder and has taken all necessary corporate action in respect thereof.
9.6 Further Limitations on Disposition. Without in any way limiting the
representations set forth above, the Purchaser further agrees not to make any
offer or sale of all or any portion of the Shares within the United States or to
a U.S. resident unless and until:
(a) There is then in effect a Registration Statement under the
Securities Act covering such proposed offer or sale and such offer or sale is
made in accordance with such Registration Statement; or
(b) The Purchaser shall have notified the Corporation of the proposed
offer or sale and shall have furnished the Corporation with a statement of the
circumstances surrounding the proposed disposition, and if reasonably requested
by the Corporation, such Purchaser shall have furnished the Corporation with an
opinion of counsel, reasonably satisfactory to the Corporation, that such offer
or sale is exempt from the registration requirements under the Securities Act.
(c) Notwithstanding the provisions of paragraph (b) above, no such
registration statement or opinion of counsel shall be necessary for a transfer
by Purchaser to any transferees in transactions contemplated by paragraph (b)
above, if all such transferees agree in writing to be subject to the terms
hereof to the same extent as if they were Purchasers hereunder.
9.7 Legends. It is understood that each certificate representing the
Shares, and any securities issued in respect thereof or exchange therefor shall
bear legends substantially in the following form (in addition to any legend
required under applicable state securities laws):
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND HAVE BEEN
ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH,
THE SALE OR DISTRIBUTION THEREOF. SUCH SECURITIES MAY NOT BE SOLD OR
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION
-6-
<PAGE> 7
UNLESS THE CORPORATION RECEIVES AN OPINION OF COUNSEL REASONABLY
ACCEPTABLE TO IT STATING THAT SUCH SALE OR TRANSFER IS EXEMPT FROM THE
REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SAID ACT. COPIES
OF THE AGREEMENTS COVERING THE PURCHASE OF THESE SECURITIES AND
RESTRICTING THEIR TRANSFER MAY BE OBTAINED AT NO COST BY WRITTEN
REQUEST MADE BY THE HOLDER OF RECORD OF THIS CERTIFICATE TO THE
SECRETARY OF THE CORPORATION AT THE PRINCIPAL EXECUTIVE OFFICES OF THE
CORPORATION.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A LOCKUP
PERIOD OF UP TO 180 DAYS FOLLOWING THE EFFECTIVE DATE OF THE FIRST
REGISTRATION STATEMENT OF THE COMPANY FILED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, AS SET FORTH IN AN AGREEMENT BETWEEN THE ISSUER
AND THE ORIGINAL HOLDER OF THESE SECURITIES, A COPY OF WHICH MAY BE
OBTAINED AT NO COST BY WRITTEN REQUEST MADE BY THE HOLDER OF RECORD OF
THIS CERTIFICATE TO THE SECRETARY OF THE CORPORATION AT THE PRINCIPAL
EXECUTIVE OFFICES OF THE CORPORATION. SUCH LOCKUP PERIOD IS BINDING ON
TRANSFEREES OF THESE SECURITIES."
9.8 Accredited Investor Status. The Purchaser presently does, and will as
of the Closing Date, qualify as an "accredited investor" within the meaning of
Rule 501(a) promulgated under the Securities Act.
9.9 Brokers or Finders. The Purchaser has not incurred, and will not
incur, directly or indirectly, any liability for brokerage or finders' fees or
agents' commissions or any similar charges in connection with this Agreement or
any transactions contemplated hereby.
9.10 [Intentionally Omitted]
9.11 [Intentionally Omitted]
9.12 Solicitation of Proxies. Purchaser will not participate in any
solicitation of proxies with respect to the voting of Company Securities.
9.13 Notice. Purchaser shall notify the Corporation of Purchaser's
acquisition of any Company Securities within 15 days prior to such acquisition
and all such acquisitions shall comply with federal and state securities laws.
9.14 Control Group. Purchaser shall not form or participate in a "group"
(as defined in Rule 13d-5 of the Exchange Act) with respect to any Company
Securities.
-7-
<PAGE> 8
10. RELIANCE UPON REPRESENTATIONS, WARRANTIES AND COVENANTS
The Purchaser acknowledges that the representations and warranties and
covenants contained in this Agreement are made with the intent that they may be
relied upon by the Corporation to, among other things, determine its eligibility
to purchase the Shares. The Purchaser further agrees that by accepting the
Shares, the Purchaser shall be representing and warranting that the foregoing
representations and warranties are true as of the Closing with the same force
and effect as if they had been made by the Purchaser at the Closing.
11. COSTS
The Purchaser acknowledges and agrees that all costs and expenses incurred
by the Purchaser (including any fees and disbursements of any counsel retained
by the Purchaser) relating to the offer and sale of the Shares to the Purchaser
shall be paid by the Purchaser.
12. GOVERNING LAW
This Agreement shall be governed in all respects by the laws of the State
of California.
13. SURVIVAL
This Agreement, including without limitation the representations,
warranties and covenants contained herein, shall survive and continue in full
force and effect and be binding upon the parties notwithstanding the completion
of the purchase of the Shares by the Purchaser pursuant hereto, or any
subsequent disposition by the Purchaser of the Shares.
14. ASSIGNMENT
This Agreement is not transferable or assignable by the parties hereto.
15. ENTIRE AGREEMENT; AMENDMENT
This Agreement, the Exhibits hereto, and the other documents delivered
pursuant hereto constitute the full and entire understanding and agreement among
the parties with regard to the subjects hereof and thereof. Neither this
Agreement nor any term hereof may be amended, waived, discharged or terminated
other than by a written instrument signed by the Purchaser and the Corporation.
16. NOTICES, ETC.
All notices and other communications required or permitted hereunder shall
be in writing and shall be deemed effectively given upon personal delivery; upon
confirmed transmission by telecopy
-8-
<PAGE> 9
or telex; or seven (7) days following deposit with the United States Post
Office, by registered or certified mail, postage prepaid, addressed: (a) if to
the Purchaser, at One Microsoft Way, Redmond, Washington 98052-6399, or its
telecopy number or telex number or at such other address as such Purchaser shall
have furnished to the Corporation in writing, or (b) if to the Corporation, at
40919 Encyclopedia Circle, Fremont, California 94538, or its telecopy or telex
number, addressed to the attention of the President, and with a copy to Wilson
Sonsini Goodrich & Rosati, 650 Page Mill Road, Palo Alto, California 94304,
Attention: Judith M. O'Brien, or at such other address as the Corporation shall
have furnished to the Purchaser in writing.
17. DELAYS OR OMISSIONS.
No delay or omission to exercise any right, power or remedy accruing to any
holder of any Common Stock, upon any breach or default of the Corporation under
this Agreement, shall impair any such right, power or remedy of such holder, nor
shall it be construed to be a waiver of any such breach or default, or an
acquiescence therein, or of or in any similar breach or default thereafter
occurring, nor shall any waiver of any single breach or default be deemed a
waiver of any other breach or default theretofore or thereafter occurring. Any
waiver, permit, consent or approval of any kind or character on the part of any
holder of Common Stock of any breach or default under this Agreement, or any
waiver on the part of such holder of any provisions or conditions of this
Agreement, must be in writing and shall be effective only to the extent
specifically set forth in such writing. All remedies, either under this
Agreement or by law or otherwise afforded to any such holder, shall be
cumulative and not alternative.
18. SEVERABILITY
In the event that any provision of this Agreement becomes or is declared by
a court of competent jurisdiction to be illegal, unenforceable or void, this
Agreement shall continue in full force and effect without said provision;
provided that no such severability shall be effective if it materially changes
the economic benefit of this Agreement to any party.
19. COUNTERPARTS
This Agreement may be exercised in counterparts, each of which shall be
deemed to be an original and all of which shall constitute one and the same
document.
20. TERMINATION
This Agreement shall terminate and be of no further force and effect, and
the rights of the Purchaser and the Corporation hereunder shall terminate if the
registration statement filed in connection with the Corporation's IPO shall not
have been declared effective by the Securities and Exchange Commission on or
before March 31, 2000.
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<PAGE> 10
EXECUTED at __________, this 14th day of January, 2000.
MICROSOFT CORPORATION
By: /s/ JOHN CONNORS
-------------------------------------
(Signature of Authorized Representative)
John Connors
----------------------------------------
(Name of Person Signing)
SUP-CFO
----------------------------------------
Office or Title
-10-
<PAGE> 11
ACCEPTANCE
The above-mentioned Subscription Agreement is hereby accepted and agreed to
by Avanex Corporation.
EXECUTED at Fremont, California, the 14th day of January, 2000.
AVANEX CORPORATION
By: /s/ WALTER ALESSANDRINI
-------------------------------------
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<PAGE> 1
EXHIBIT 10.36
SUBSCRIPTION AGREEMENT
TO: AVANEX CORPORATION
RE: SUBSCRIPTION FOR AND PURCHASE OF SHARES OF COMMON STOCK
1. SUBSCRIPTION
MCI Worldcom Venture Fund (the "PURCHASER") hereby irrevocably subscribes
for and agrees to purchase, on and subject to the terms and conditions set forth
herein, from Avanex Corporation, a California corporation (the "CORPORATION"),
three hundred eighty-four thousand six hundred fifteen (384,615) shares of
Common Stock of the Corporation (the "SHARES") at a price of $13.00 per share,
having the voting powers, designations, preferences, rights and qualifications
set forth in the Corporation's Restated Certificate of Incorporation, the form
of which is attached hereto as Exhibit "A" (the "RESTATED CERTIFICATE") which is
the form of the Corporation's certificate of incorporation which will govern the
Corporation upon the closing of the Corporation's initial public offering (the
"IPO"). Purchaser hereby acknowledges that the Corporation is currently
incorporated in California and is undertaking a reincorporation in Delaware. In
connection therewith, each holder of two shares of capital stock of the
California corporation will receive three shares of the Delaware corporation
(the "3-FOR-2 SPLIT"). THE NUMBER OF SHARES SUBSCRIBED FOR HEREIN AND THE
SUBSCRIPTION PRICE (AS DEFINED BELOW) GIVE EFFECT TO THE 3-FOR-2 SPLIT.
2. PAYMENT
At Closing, as defined below, the aggregate purchase price for the Shares,
$4,999,995 (the "SUBSCRIPTION PRICE"), shall be paid by wire transfer to the
following account: Coamerica Bank, 55 Almaden Blvd., 2nd Floor, San Jose,
California 95113: ABA No. 121137522; Account No. 1891190538.
3. DOCUMENTS TO BE PROVIDED BY PURCHASER
The Purchaser must complete, sign and return as soon as possible, two
executed copies of each of this Subscription Agreement and the Third Amended and
Restated Registration Rights Agreement (the "RIGHTS AGREEMENT") attached as
Exhibit "B".
4. CLOSING AND DELIVERY OF SHARE CERTIFICATES
Delivery and payment for the Shares will be completed in one closing (the
"CLOSING") at the offices of Wilson Sonsini Goodrich & Rosati, 650 Page Mill
Road, Palo Alto, California at 8:00 a.m. (Pacific Daylight Time) (the "CLOSING
TIME") on such date as the Corporation and the Purchaser may agree (the "CLOSING
DATE"), but in any event not later than February 15, 2000 (unless extended by
mutual agreement of the Corporation and the Purchaser).
<PAGE> 2
A certificate representing the Shares (the "CERTIFICATE") will be delivered
at Closing against payment to the Corporation of the Subscription Price in the
manner specified in Paragraph 2 above.
5. CONDITIONS TO CLOSING OF THE PURCHASER
The Purchaser's obligation to purchase the Shares at the Closing is, at the
option of the Purchaser, subject to fulfillment on or prior to the Closing Date
of the following conditions:
5.1 Registration Rights Agreement. The Corporation shall have executed and
delivered to the Purchaser the Rights Agreement.
5.2 Subscription Agreement. The Corporation shall have executed and
delivered to the Purchaser a copy of this Subscription Agreement.
5.3 Registration Statement. The registration statement filed with the
Securities and Exchange Commission in connection with the Corporation's initial
offering of its securities to the public shall have been declared effective.
6. CONDITIONS TO CLOSING OF THE CORPORATION
The Corporation's obligation to issue and sell the Shares at the Closing to
the Purchaser is, at the option of the Corporation, subject to the fulfillment
of the following conditions:
6.1 Representations and Warranties. The representations and warranties
made by the Purchaser in Section 9 hereof shall be true and correct when made,
and shall be true and correct on the Closing Date with the same force and effect
as if such representations had been made on and as of said date.
6.2 Subscription Agreement. The Purchaser shall have executed and
delivered to the Corporation a copy of this Subscription Agreement.
6.3 Payment. The Corporation shall have received from the Purchaser
payment in full for the Subscription Price.
6.4 Registration Rights Agreement. The Purchaser shall have executed and
delivered the Rights Agreement to the Corporation.
6.5 Lockup Agreement. The Purchaser shall have executed and delivered a
Lockup Agreement to the Corporation's underwriters in the form of Exhibit "C"
hereto.
7. REPRESENTATIONS AND WARRANTIES OF THE CORPORATION
The Corporation hereby represents and warrants to the Purchaser that,
except as otherwise set forth on Exhibit "C" hereto, with specific reference to
the subsection of this Section 7 so affected,
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<PAGE> 3
the following will be true and correct as of the Closing Date (except for the
representation contained in Section 7.3, which is true as of the date hereof):
7.1 Organization and Standing. The Corporation is a corporation duly
organized and validly existing under, and by virtue of, the laws of the State of
California and is in good standing under such laws. The Corporation has the
requisite corporate power to own and operate its properties and assets and to
carry on its business as presently conducted.
7.2 Corporate Power. The Corporation has all requisite legal and corporate
power to execute and deliver this Subscription Agreement and the Rights
Agreement, to sell and issue the Shares hereunder and to carry out and perform
its obligations under the terms of this Subscription Agreement and the Rights
Agreement.
7.3 Capitalization. Giving effect to the stock split effected in
connection with the Corporation's reincorporation into Delaware, the authorized
capital stock of the Corporation consists of 300,000,000 shares of Common Stock,
20,403,456 of which are issued and outstanding and 38,100,000 shares of
Preferred Stock. As of the date hereof, 6,900,000 shares of Preferred Stock have
been designated Series A Preferred, 6,795,120 of which are issued and
outstanding; 9,525,000 shares of Preferred Stock have been designated Series B
Preferred, 9,445,116 of which are issued and outstanding; 16,275,000 shares of
Preferred Stock have been designated Series C Preferred, 13,548,253 of which are
issued and outstanding; and 5,400,000 shares of Preferred Stock have been
designated Series D Preferred, 5,230,646 of which are issued and outstanding.
Effective with the Closing of the IPO, all outstanding Preferred Stock will
convert to Common Stack at a rate of one share of Common Stock for each share of
Preferred Stock. Simultaneously therewith, the Corporation shall file the
Restated Certificate with the Secretary of State of Delaware and the authorized
capital stock of the Company shall consist of 300,000,000 shares of Common
Stock, of which 55,422,591 will be outstanding (assuming (i) no exercise of
options or warrants after December 31, 1999, (ii) the issuance of 6,000,000
shares of Common Stock in the Corporation's IPO, and (iii) no exercise of the
underwriter's over-allotment option in connection with the IPO) and 10,000,000
shares of Preferred Stock, none of which shall be outstanding. The Common Stock
and Preferred Stock have the voting power, designations, preferences, rights and
qualifications set forth in the Restated Certificate. As of December 31, 1999,
except as contemplated herein and except for: (i) the pre-emptive rights granted
pursuant to the Rights Agreement, (ii) options to purchase 3,401,427 shares of
Common Stock of the Corporation granted under its 1998 Stock Plan, and (iii)
warrants to purchase a total of up to 337,500 shares of Common Stock and 29,347
shares of Series D Preferred Stock, there are no options, warrants, conversion
privileges or other rights presently outstanding to purchase or otherwise
acquire any authorized but unissued shares of the capital stock or other
securities of the Corporation, nor any agreements or understandings with respect
thereto.
7.4 Financial Statements. As of the Closing Date, the Corporation will
have d
7.5 Financial Statements. As of the Closing Date, the Corporation will
have delivered to the Purchaser the audited financial statements of the
Corporation as of December 31, 1999 (the "FINANCIAL STATEMENTS"). The Financial
Statements, together with the notes thereto, are complete and correct in all
material respects, have been prepared in accordance with generally
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accepted accounting principles consistently applied throughout the periods
covered thereby, and present fairly the financial position of the Corporation as
of their respective dates. Other than as described in the Financial Statements,
the Corporation has no material liabilities and knows of no material contingent
liabilities not disclosed in the Financial Statements, except current
liabilities incurred in the ordinary course of business which are not,
individually or in the aggregate, materially adverse.
7.6 Authorization. All corporate action on the part of the Corporation,
its directors and stockholders necessary for the authorization, execution,
delivery and performance of this Agreement and the Rights Agreement, the
authorization, sale, issuance and delivery of the Shares and the performance of
the Corporation's obligations hereunder and thereunder has been taken or will be
taken prior to the Closing. This Agreement and the Rights Agreement when fully
executed and delivered by the Corporation, shall constitute valid and binding
obligations of the Corporation, enforceable in accordance with their respective
terms, subject to laws of general application relating to bankruptcy, insolvency
and the relief of debtors and rules of law governing specific performance,
injunctive relief or other equitable remedies. The Shares, when issued in
compliance with the provisions of this Agreement, will be validly issued, fully
paid and non-assessable, and free of any liens or encumbrances; provided,
however, that the Shares may be subject to certain restrictions on transfer
under applicable state and/or Federal securities laws.
7.7 Governmental Consents, etc. No consent, approval or authorization of
or designation, declaration or filing with any state or federal governmental
authority on the part of the Corporation is required in connection with the
valid execution and delivery of this Agreement, the Rights Agreement or the
offer, sale or issuance of the Shares, or the consummation of any other
transaction contemplated hereby, except qualification (or taking such action as
may be necessary to secure an exemption from qualification, if available) under
the California Corporate Securities Law and other applicable blue sky laws, of
the offer and sale of the Shares, which filing and qualification, if required,
will be accomplished in a timely manner prior to or promptly after the Closing.
7.8 Registration Rights. At the Closing, except as set forth in the Rights
Agreement, the Corporation will not be under any obligation to register any of
its presently outstanding securities, or any of its securities which may
hereafter be issued, under the Securities Act of 1933, as amended (the
"SECURITIES ACT").
7.9 Brokers or Finders. The Corporation has not incurred, and will not
incur, directly or indirectly, any liability for brokerage or finders' fees or
agents' commissions or any similar charges in connection with this Agreement or
any transaction contemplated hereby.
7.10 No Conflict. The offer and sale of the Shares by the Corporation and
the performance and consummation of the transactions contemplated herein will
not conflict with or result in (i) a breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement (written or oral) or instrument to
which the Corporation is bound or to which any of the property or assets of the
Corporation is subject, which breach or violation or the consequences thereof
would result in a Material Adverse Effect, (ii) any violation of the provisions
of the Restated Certificate, the by-laws or any resolutions of the Corporation
or (iii) to the Corporation's knowledge a violation of any
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<PAGE> 5
statute or any order, rule or regulation of any court or governmental agency or
body having jurisdiction over the Corporation or any of its assets or
properties, which violation or the consequences thereof would result in a
Material Adverse Effect.
8. CERTAIN MATTERS RELATING TO THE OFFER AND SALE OF THE SHARES
The Purchaser acknowledges and agrees that: (i) it has not been provided
with a registration statement, prospectus or any similar document in connection
with its purchase of the Shares and (ii) its decision to execute this Agreement
and the Rights Agreement and to purchase the Shares has not been based upon any
verbal or written representations as to fact or otherwise made by or on behalf
of the Corporation and that its decision is based upon the information,
representations and covenants of the Corporation contained in this Agreement,
its own review of certain of the Corporation's documents and records, and
publicly available information concerning the Corporation.
9. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASER
The Purchaser hereby represents, warrants and covenants to the Corporation
(which representations, warranties and covenants shall survive the Closing) as
of the date hereof and as of the Closing Date as follows:
9.1 Experience; Risk. The Purchaser has such knowledge and experience in
financial and business matters that it is capable of evaluating the merits and
risks of the purchase of the Shares pursuant to this Agreement and is capable of
protecting its interests in connection herewith. The Purchaser has the ability
to bear the economic risk of the investment, including complete loss of the
investment.
9.2 Investment. The Purchaser is acquiring the Shares for investment for
its own account, not as a nominee or agent, and not with a view to, or for,
resale in connection with any distribution thereof, and the Purchaser has no
present intention to sell, grant any participation in, or otherwise distribute
the Shares. The Purchaser understands that the Shares have not been registered
under the Securities Act and will be issued pursuant to an exemption from the
registration requirements thereof, which exemption depends upon, among other
things, the bona fide nature of the investment intent and the accuracy of such
Purchaser's representations as expressed herein.
9.3 Rule 144. The Purchaser understands that the Shares are "restricted
securities" under Federal securities laws, as they are unregistered and are
being acquired from the Corporation in a transaction not involving a public
offering, and that under such laws and applicable regulations promulgated
thereunder the Shares may be resold without registration under the Securities
Act only in certain limited circumstances. The Purchaser acknowledges that the
Shares must be held indefinitely unless subsequently registered under the
Securities Act or an exemption from such registration is available. The
Purchaser is aware of the provisions of Rule 144 promulgated under the
Securities Act, the provisions of which limit resale of "restricted securities."
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9.4 No Public Market. The Purchaser understands that no public market now
exists for the Shares or for any other securities issued by the Corporation and
that there is no assurance that a public market will ever exist for the Shares.
9.5 Authorization.
(a) The Purchaser has the full right, power and authority to enter
into and perform its obligations under this Agreement and the Rights Agreement.
This Agreement and the Rights Agreement when executed and delivered by the
Purchaser, will constitute valid and binding obligations of the Purchaser,
enforceable in accordance with their respective terms, subject to the laws of
general application relating to bankruptcy, insolvency and the relief of
debtors, rules of law governing specific performance, injunctive relief and
other equitable remedies.
(b) The Purchaser further represents that it is a validly existing
corporation, has the necessary corporate capacity and authority to execute and
deliver this Agreement and to observe and perform its covenants and obligations
hereunder and has taken all necessary corporate action in respect thereof.
9.6 Further Limitations on Disposition. Without in any way limiting the
representations set forth above, the Purchaser further agrees not to make any
offer or sale of all or any portion of the Shares within the United States or to
a U.S. resident unless and until:
(a) There is then in effect a Registration Statement under the
Securities Act covering such proposed offer or sale and such offer or sale is
made in accordance with such Registration Statement; or
(b) The Purchaser shall have notified the Corporation of the proposed
offer or sale and shall have furnished the Corporation with a statement of the
circumstances surrounding the proposed disposition, and if reasonably requested
by the Corporation, such Purchaser shall have furnished the Corporation with an
opinion of counsel, reasonably satisfactory to the Corporation, that such offer
or sale is exempt from the registration requirements under the Securities Act.
(c) Notwithstanding the provisions of paragraph (b) above, no such
registration statement or opinion of counsel shall be necessary for a transfer
by Purchaser to any transferees in transactions contemplated by paragraph (b)
above, if all such transferees agree in writing to be subject to the terms
hereof to the same extent as if they were Purchasers hereunder.
9.7 Legends. It is understood that each certificate representing the
Shares, and any securities issued in respect thereof or exchange therefor shall
bear legends substantially in the following form (in addition to any legend
required under applicable state securities laws):
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND HAVE BEEN
ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH,
THE SALE OR DISTRIBUTION THEREOF. SUCH SECURITIES MAY NOT BE SOLD OR
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION
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<PAGE> 7
UNLESS THE CORPORATION RECEIVES AN OPINION OF COUNSEL REASONABLY
ACCEPTABLE TO IT STATING THAT SUCH SALE OR TRANSFER IS EXEMPT FROM THE
REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SAID ACT. COPIES
OF THE AGREEMENTS COVERING THE PURCHASE OF THESE SECURITIES AND
RESTRICTING THEIR TRANSFER MAY BE OBTAINED AT NO COST BY WRITTEN
REQUEST MADE BY THE HOLDER OF RECORD OF THIS CERTIFICATE TO THE
SECRETARY OF THE CORPORATION AT THE PRINCIPAL EXECUTIVE OFFICES OF THE
CORPORATION.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A LOCKUP
PERIOD OF UP TO 180 DAYS FOLLOWING THE EFFECTIVE DATE OF THE FIRST
REGISTRATION STATEMENT OF THE CORPORATION FILED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, AS SET FORTH IN AN AGREEMENT BETWEEN THE
ISSUER AND THE ORIGINAL HOLDER OF THESE SECURITIES, A COPY OF WHICH
MAY BE OBTAINED AT NO COST BY WRITTEN REQUEST MADE BY THE HOLDER OF
RECORD OF THIS CERTIFICATE TO THE SECRETARY OF THE CORPORATION AT THE
PRINCIPAL EXECUTIVE OFFICES OF THE CORPORATION. SUCH LOCKUP PERIOD IS
BINDING ON TRANSFEREES OF THESE SECURITIES."
9.8 Accredited Investor Status. The Purchaser presently does, and will as
of the Closing Date, qualify as an "accredited investor" within the meaning of
Rule 501(a) promulgated under the Securities Act.
9.9 Brokers or Finders. The Purchaser has not incurred, and will not
incur, directly or indirectly, any liability for brokerage or finders' fees or
agents' commissions or any similar charges in connection with this Agreement or
any transactions contemplated hereby.
9.10 Standstill. The Purchaser will not, during a period ending January 1,
2010, without the prior written approval of the Corporation's Board of
Directors: (i) acquire greater than 5% of the capital stock of the Corporation
("COMPANY SECURITIES") other than as contemplated herein, (ii) enter into any
merger, consolidation or similar transaction with the Corporation, (iii)
otherwise attempt to influence the Board of Directors of the Corporation, the
officers or the stockholders of the Corporation to effect a merger,
consolidation or sale of all or substantially all of the assets or business of
the Corporation or to otherwise effect a change in the policies of the
Corporation, or (iv) make any public announcement relating to the foregoing.
Notwithstanding the foregoing, the restrictions contained in the preceding
sentence shall be suspended during such time as (i) the Board of Directors of
the Corporation determines to accept bids from any responsible bidder to obtain
the best price for the sale of the Corporation, but only so long as the
Corporation continues to accept such bids or negotiate or consummate a
transaction with any bidder and (ii) any third party who has not executed an
agreement and plan of merger or similar agreement with the Corporation makes an
unsolicited offer to acquire more than fifty percent (50%) of the outstanding
voting securities of the
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Corporation as evidenced by the filing with the Securities and Exchange
Commission of a Schedule 14D-7 and the actual dissemination of tender offer
materials to holder of Company Securities, but only so long as such offer is
outstanding.
9.11 Right of Repurchase. If, at any time after the Closing, Purchaser
acquires or otherwise holds or beneficially owns (within the meaning of Rule
13d-3 of the Exchange Act) more than 5% of the outstanding voting capital stock
of the Corporation, the Corporation shall have the right to repurchase from
Purchaser such shares of capital stock so as to reduce Purchaser's aggregate
holdings after such purchase to 5% of the outstanding voting capital stock of
the Corporation.
9.12 Solicitation of Proxies. Purchaser will not participate in any
solicitation of proxies with respect to the voting of Company Securities.
9.13 Notice. Purchaser shall notify the Corporation of Purchaser's
acquisition of any Company Securities within 15 days prior to such acquisition
and all such acquisitions shall comply with federal and state securities laws.
9.14 Control Group. Purchaser shall not form or participate in a "group"
(as defined in Rule 13d-5 of the Exchange Act) with respect to any Company
Securities.
10. RELIANCE UPON REPRESENTATIONS, WARRANTIES AND COVENANTS
The Purchaser acknowledges that the representations and warranties and
covenants contained in this Agreement are made with the intent that they may be
relied upon by the Corporation to, among other things, determine its eligibility
to purchase the Shares. The Purchaser further agrees that by accepting the
Shares, the Purchaser shall be representing and warranting that the foregoing
representations and warranties are true as of the Closing with the same force
and effect as if they had been made by the Purchaser at the Closing.
11. COSTS
The Purchaser acknowledges and agrees that all costs and expenses incurred
by the Purchaser (including any fees and disbursements of any counsel retained
by the Purchaser) relating to the offer and sale of the Shares to the Purchaser
shall be paid by the Purchaser.
12. GOVERNING LAW
This Agreement shall be governed in all respects by the laws of the State
of California.
13. SURVIVAL
This Agreement, including without limitation the representations,
warranties and covenants contained herein, shall survive and continue in full
force and effect and be binding upon the parties
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<PAGE> 9
notwithstanding the completion of the purchase of the Shares by the Purchaser
pursuant hereto, or any subsequent disposition by the Purchaser of the Shares.
14. ASSIGNMENT
This Agreement is not transferable or assignable by the parties hereto.
15. ENTIRE AGREEMENT; AMENDMENT
This Agreement, the Exhibits hereto, and the other documents delivered
pursuant hereto constitute the full and entire understanding and agreement among
the parties with regard to the subjects hereof and thereof. Neither this
Agreement nor any term hereof may be amended, waived, discharged or terminated
other than by a written instrument signed by the Purchaser and the Corporation.
16. NOTICES, ETC.
All notices and other communications required or permitted hereunder shall
be in writing and shall be deemed effectively given upon personal delivery; upon
confirmed transmission by telecopy or telex; or seven (7) days following deposit
with the United States Post Office, by registered or certified mail, postage
prepaid, addressed: (a) if to the Purchaser, at [__________], or its telecopy
number or telex number or at such other address as such Purchaser shall have
furnished to the Corporation in writing, or (b) if to the Corporation, at 40919
Encyclopedia Circle, Fremont, California 94538, or its telecopy or telex number,
addressed to the attention of the President, and with a copy to Wilson Sonsini
Goodrich & Rosati, 650 Page Mill Road, Palo Alto, California 94304, Attention:
Judith M. O'Brien, or at such other address as the Corporation shall have
furnished to the Purchaser in writing.
17. DELAYS OR OMISSIONS.
No delay or omission to exercise any right, power or remedy accruing to any
holder of any Common Stock, upon any breach or default of the Corporation under
this Agreement, shall impair any such right, power or remedy of such holder, nor
shall it be construed to be a waiver of any such breach or default, or an
acquiescence therein, or of or in any similar breach or default thereafter
occurring, nor shall any waiver of any single breach or default be deemed a
waiver of any other breach or default theretofore or thereafter occurring. Any
waiver, permit, consent or approval of any kind or character on the part of any
holder of Common Stock of any breach or default under this Agreement, or any
waiver on the part of such holder of any provisions or conditions of this
Agreement, must be in writing and shall be effective only to the extent
specifically set forth in such writing. All remedies, either under this
Agreement or by law or otherwise afforded to any such holder, shall be
cumulative and not alternative.
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<PAGE> 10
18. SEVERABILITY
In the event that any provision of this Agreement becomes or is declared by
a court of competent jurisdiction to be illegal, unenforceable or void, this
Agreement shall continue in full force and effect without said provision;
provided that no such severability shall be effective if it materially changes
the economic benefit of this Agreement to any party.
19. COUNTERPARTS
This Agreement may be exercised in counterparts, each of which shall be
deemed to be an original and all of which shall constitute one and the same
document.
20. TERMINATION
This Agreement shall terminate and be of no further force and effect, and
the rights of the Purchaser and the Corporation hereunder, shall terminate if
the registration statement filed in connection with the Corporation's IPO shall
not have been declared effective by the Securities and Exchange Commission on or
before March 31, 2000.
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<PAGE> 11
EXECUTED at 4:30 p.m., EST, this 14th day of January, 2000.
MCI WORLDCOM, INC.
By: /s/ DOUGLAS C. WEBSTER
-------------------------------------
(Signature of Authorized Representative)
Douglas C. Webster
----------------------------------------
(Name of Person Signing)
Director
----------------------------------------
Office or Title
MCI WORLDCOM VENTURE FUND
By: /s/ DOUGLAS C. WEBSTER
-------------------------------------
Douglas C. Webster
----------------------------------------
(Name of Person Signing)
Vice President
----------------------------------------
Office or Title
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<PAGE> 12
ACCEPTANCE
The above-mentioned Subscription Agreement is hereby accepted and agreed to
by Avanex Corporation.
EXECUTED at Fremont, California, the 14th day of January, 2000.
AVANEX CORPORATION
By: /s/ WALTER ALESSANDRINI
-------------------------------------
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<PAGE> 1
EXHIBIT 10.37
AVANEX CORPORATION
THIRD AMENDED AND RESTATED
SHAREHOLDER RIGHTS AGREEMENT
This Third Amended and Restated Shareholder Rights Agreement (this
"Agreement"), made as of this 14th day of January, 2000 and effective upon the
closing of the transactions contemplated by the Subscription Agreements (as
defined below) by and among Avanex Corporation, a California corporation (the
"Company"), the purchasers of the Company's Series A Preferred Stock (the
"Series A Preferred"), Series B Preferred Stock (the "Series B Preferred") and
Series C Preferred Stock (the "Series C Preferred") pursuant to that certain
Amended and Restated Series A Preferred, Series B Preferred and Series C
Preferred Stock Purchase Agreement dated February 19, 1999 between the Company
and such purchasers (the "Series A,B,C Agreement"), the purchasers of the
Company's Series D Preferred Stock (the "Series D Preferred") pursuant to that
certain Series D Preferred Stock Purchase Agreement dated September 14, 1999
(the "Series D Agreement") between the Company and such purchasers (including
purchasers in subsequent closings under the Series D Agreement who execute a
counterpart signature page to this Agreement) (the purchasers of Series A
Preferred, Series B Preferred, Series C Preferred and Series D Preferred are
collectively referred to herein as the "Prior Purchasers"; the Series A
Preferred, Series B Preferred, Series C Preferred and Series D Preferred are
collectively referred to herein as the "Preferred Stock") and the purchasers of
the Company's Common Stock pursuant to Subscription Agreements dated January
___, 2000 (the "Subscription Agreements") between the Company and such
purchasers (the "Common Stock Purchasers"). (The Prior Purchasers and the Common
Stock Purchasers are collectively referred to herein as the "Purchasers").
WHEREAS, the Company and Common Stock Purchasers entered into the
Subscription Agreements pursuant to which the Company agreed to grant to the
Common Stock Purchasers registration rights upon the terms hereinafter set
forth;
WHEREAS, the Company and the Prior Purchasers have entered into that
certain Second Amended and Restated Shareholders' Rights Agreement dated
September 14, 1999 (the "Prior Agreement");
WHEREAS, pursuant to Section 24 of the Prior Agreement, the Prior Agreement
may be amended as set forth herein with the Company's prior written consent and
the consent of the holders of a majority of the outstanding Registrable
Securities under such Prior Agreement;
WHEREAS, the parties hereto consisting of the Company, the Founders, the
Prior Purchasers and the Common Stock Purchasers desire to amend, restate and
supersede in their entirety the terms of the Prior Agreement as set forth herein
and to modify certain provisions thereof;
NOW, THEREFORE, in consideration of the mutual promises and covenants
hereinafter set forth, the parties agree as follows:
<PAGE> 2
AGREEMENT
1. Certain Definitions. As used in this Agreement, the following terms
shall have the following respective meanings:
"Commission" shall mean the Securities and Exchange Commission or any
successor agency.
"Registrable Securities" shall mean (i) shares of the Company's Common
Stock issued or issuable upon the conversion of the Series A Preferred, Series B
Preferred, or Series C Preferred or Series D Preferred; (ii) any Common Stock of
the Company or other securities issued or issuable in respect of shares of the
Series A Preferred, Series B Preferred, Series C Preferred or Series D
Preferred; (iii) shares of the Company's Common Stock or other securities issued
or issuable with respect to, or in exchange for or in replacement of shares of
the Company's Common Stock issued or issuable upon conversion of the Series A
Preferred, Series B Preferred, Series C Preferred or Series D Preferred or other
securities convertible into or exercisable for the Series A Preferred, Series B
Preferred, Series C Preferred or Series D Preferred upon any stock split, stock
dividend, recapitalization, or similar event, and (iv) shares of the Company's
Common Stock issued pursuant to the Subscription Agreements (the "Subscription
Shares") and any securities of the Company issued or issuable with respect to
the Subscription Shares or in exchange for or in replacement thereof; provided,
however, that any shares described in clauses (i)-(iv) above which have been
resold to the public or with respect to which the registration rights of the
holder thereof have terminated pursuant to Section 10 hereof shall cease to be
Registrable Securities.
"Holder" shall mean each Purchaser and any transferee of Registrable
Securities who, pursuant to Section 15 below, is entitled to registration rights
hereunder.
"Preferred Stock Agreements" shall mean the Series A,B,C Agreement and the
Series D Agreement.
"Restricted Securities" shall mean the securities of the Company required
to bear the legend set forth in Section 3 hereof (or any similar legend).
The terms "register," "registered" and "registration" refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act (as defined below), and the declaration or
ordering of the effectiveness of such registration statement.
"Registration Expenses" shall mean all expenses incurred by the Company in
complying with Sections 5, 6 and 9 hereof, including, without limitation, all
registration, qualification and filing fees, printing expenses, escrow fees,
fees and disbursements of counsel for the Company, blue sky fees and expenses,
accounting fees of the Company, and the expense of any special audits incident
to or required by any such registration.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Selling Expenses" shall mean all underwriting discounts, selling
commissions and stock transfer taxes applicable to the securities registered by
the Holders.
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<PAGE> 3
2. Restrictions on Transferability. The Restricted Securities shall not
be transferable except upon the conditions specified in this Agreement, which
conditions are intended to ensure compliance with the provisions of the
Securities Act. Each Holder of Restricted Securities will cause any proposed
transferee of the Restricted Securities held by such Holder to agree to take and
hold such Restricted Securities subject to the provisions and upon the
conditions specified in this Agreement.
3. Restrictive Legend. Each certificate representing (i) the Series A
Preferred, Series B Preferred, Series C Preferred, Series D Preferred or the
Subscription Shares, (ii) shares of the Company's Common Stock issued upon
conversion of the Series A Preferred, Series B Preferred, Series C Preferred or
Series D Preferred, (iii) the Subscription Shares and (iv) any other securities
issued in respect of the Series A Preferred, Series B Preferred, Series C
Preferred, Series D Preferred or the Subscription Shares and Common Stock issued
upon conversion of the Series A Preferred, Series B Preferred, Series C
Preferred or Series D Preferred upon any stock split, stock dividend,
recapitalization, merger, consolidation or similar event, shall (unless
otherwise permitted by the provisions of Section 4 below) be stamped or
otherwise imprinted with a legend in the following form (in addition to any
legend required under applicable state securities laws):
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933. THESE SHARES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF
SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER SAID ACT. COPIES OF
THE AGREEMENT COVERING THE PURCHASE OF THESE SHARES AND RESTRICTING
THEIR TRANSFER MAY BE OBTAINED AT NO COST BY WRITTEN REQUEST MADE BY
THE HOLDER OF RECORD OF THIS CERTIFICATE TO THE SECRETARY OF THE
CORPORATION AT THE PRINCIPAL EXECUTIVE OFFICES OF THE CORPORATION.
4. Notice of Proposed Transfers. The Holder of each certificate
representing Restricted Securities by acceptance thereof agrees to comply in all
respects with the provisions of this Section 4. Prior to any proposed transfer
of any Restricted Securities (other than (i) a transfer not involving a change
in beneficial ownership, or (ii) in transactions involving the distribution
without consideration of Restricted Securities by a Purchaser to any of its
partners, or retired partners, or to the estate of any of its partners or
retired partners, (iii) a transfer to an affiliated fund or partnership, (iv)
transfers in compliance with Rule 144, so long as the Company is furnished with
satisfactory evidence of compliance with such Rule), unless there is in effect a
registration statement under the Securities Act covering the proposed transfer,
the Holder thereof shall give written notice to the Company of such Holder's
intention to effect such transfer. Each such notice shall describe the manner
and circumstances of the proposed transfer in sufficient detail, and shall, if
the Company so requests, be accompanied (except in transactions in compliance
with Rule 144) by either (i) an unqualified written opinion of legal counsel who
shall be reasonably satisfactory to the Company, addressed to the Company and
reasonably satisfactory in form and substance to the Company's counsel, to the
effect that the proposed transfer of the Restricted Securities may be effected
without registration under the Securities Act, or (ii) a "no action" letter from
the Commission to the effect that the transfer of such securities without
registration will not result in a recommendation by the staff of the Commission
that action be taken with respect thereto, whereupon the holder of such
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<PAGE> 4
Restricted Securities shall be entitled to transfer such Restricted Securities
in accordance with the terms of the notice delivered by the holder to the
Company. Each certificate evidencing the Restricted Securities transferred as
above provided shall bear the appropriate restrictive legend set forth in
Section 3 above, except that such certificate shall not bear such restrictive
legend if in the opinion of counsel for the Company such legend is not required
in order to establish compliance with any provisions of the Securities Act.
5. Requested Registration.
(a) Request for Registration. If at any time after the earlier of (i)
five years from September 14, 1999 or (ii) six months after the closing date of
the first registration statement filed by the Company covering an underwritten
offering of any of its securities to the general public, the Company shall
receive from any Holder or group of Holders holding at least a majority of the
Registrable Securities (the "Initiating Holders") a written request that the
Company effect any registration, qualification or compliance with respect to at
least thirty percent (30%) of the shares of Registrable Securities, or such
lesser number of shares of Registrable Securities if the reasonably anticipated
aggregate proceeds of such offering exceed $15,000,000, the Company will:
(x) promptly give written notice of the proposed registration,
qualification or compliance to all other Holders holding Registrable Securities;
and
(y) as soon as practicable, use its best efforts to effect such
registration, qualification or compliance (including, without limitation, the
execution of an undertaking to file post-effective amendments, appropriate
qualification under applicable blue sky or other state securities laws and
appropriate compliance with applicable regulations issued under the Securities
Act and any other governmental requirements or regulations) as may be so
requested and as would permit or facilitate the sale and distribution of all or
such portion of such Registrable Securities as are specified in such request,
together with all or such portion of the Registrable Securities of any Holder or
Holders joining in such request as are specified in a written request received
by the Company within 20 days after receipt of such written notice from the
Company;
Provided, however, that the Company shall not be obligated to take any
action to effect any such registration, qualification or compliance pursuant to
this Section 5:
(A) In any particular jurisdiction in which the Company
would be required to execute a general consent to service of process in
effecting such registration, qualification or compliance unless the Company is
already subject to service in such jurisdiction and except as may be required by
the Securities Act;
(B) After the Company has effected two such registrations
pursuant to this Section 5(a), such registrations have been declared or ordered
effective and the securities offered pursuant to such registrations have been
sold; or
(C) Within six months following the effective date of a
registration statement previously filed by the Company.
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<PAGE> 5
Subject to the foregoing clauses (A), (B) and (C), the Company shall file a
registration statement covering the Registrable Securities so requested to be
registered as soon as practicable after receipt of the request or requests of
the Initiating Holders. If, however, the Company shall furnish to the Initiating
Holders a certificate signed by the President of the Company stating that, in
the good faith judgment of the Board of Directors of the Company, it would be
seriously detrimental to the Company and its shareholders for such registration
statement to be filed and it is therefore essential to defer the filing of such
registration statement, the Company shall have the right to defer such filing
for a period of not more than 120 days after receipt of the request of the
Initiating Holder, provided, however, that the Company may not utilize this
right more than once in any twelve-month period.
(b) Microsoft Request. If at any time after six months after the
closing date of the first registration statement filed by the Company covering
an underwritten offering of any of its securities to the general public, the
Company shall receive a written request that the Company effect a registration,
qualification or compliance with respect to any Subscription Shares held by
Microsoft Corporation ("Microsoft"), the Company will as soon as practicable,
use its best efforts to effect such registration, qualification or compliance
(including, without limitation, the execution of an undertaking to file
post-effective amendments, appropriate qualification under applicable blue sky
or other state securities laws and appropriate compliance with applicable
regulations issued under the Securities Act and any other governmental
requirements or regulations) as may be so requested and as would permit or
facilitate the sale and distribution of all or such portion of such Subscription
Shares;
Provided, however, that the Company shall not be obligated to take any
action to effect any such registration, qualification or compliance pursuant to
this Section 5(b):
(A) In any particular jurisdiction in which the Company
would be required to execute a general consent to service of process in
effecting such registration, qualification or compliance unless the Company is
already subject to service in such jurisdiction and except as may be required by
the Securities Act; or
(B) After the Company has effected one such registration
statement pursuant to this Section 5(b) and such registration has been declared
or ordered effective;
(C) Within six months following the effective date of a
registration statement filed by the Company;
And provided further, that:
(D) No offering of securities undertaken upon a
registration requested pursuant to this Section 5(b) shall be underwritten and
the Company shall only be obligated to keep such registration statement
effective for a period of 30 days.
Subject to the foregoing clauses (A), (B) (C) and (D), the Company shall
file a registration statement covering the Subscription Shares so requested to
be registered as soon as practicable after receipt of the request or requests
therefor. If, however, the Company shall furnish to the party requesting such
registration a certificate signed by the President of the Company stating that,
in the
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<PAGE> 6
good faith judgment of the Board of Directors of the Company, it would be
seriously detrimental to the Company and its shareholders for such registration
statement to be filed and it is therefore essential to defer the filing of such
registration statement, the Company shall have the right to defer such filing
for a period of not more than 120 days after receipt of the request for
registration; provided, however, that the Company may not utilize this right
with respect to the particular party requesting such resignation more than once
in any twelve month period.
(c) MCI Worldcom Request. If at any time after six months after the
closing date of the first registration statement filed by the Company covering
an underwritten offering of any of its securities to the general public, the
Company shall receive a written request that the Company effect a registration,
qualification or compliance with respect to any Subscription Shares held by MCI
WorldcomVenture Fund ("Worldcom"), the Company will as soon as practicable, use
its best efforts to effect such registration, qualification or compliance
(including, without limitation, the execution of an undertaking to file
post-effective amendments, appropriate qualification under applicable blue sky
or other state securities laws and appropriate compliance with applicable
regulations issued under the Securities Act and any other governmental
requirements or regulations) as may be so requested and as would permit or
facilitate the sale and distribution of all or such portion of such Subscription
Shares;
Provided, however, that the Company shall not be obligated to take any
action to effect any such registration, qualification or compliance pursuant to
this Section 5(c):
(A) In any particular jurisdiction in which the Company
would be required to execute a general consent to service of process in
effecting such registration, qualification or compliance unless the Company is
already subject to service in such jurisdiction and except as may be required by
the Securities Act; or
(B) After the Company has effected one such registration
statement pursuant to this Section 5(b) and such registration has been declared
or ordered effective
(C) Within six months following the effective date of a
registration statement filed by the Company
And provided further, that:
(D) No offering of securities undertaken upon a
registration requested pursuant to this Section 5(c) shall be underwritten and
the Company shall only be obligated to keep such registration statement
effective for a period of 30 days.
Subject to the foregoing clauses (A), (B) (C) and (D), the Company shall
file a registration statement covering the Subscription Shares so requested to
be registered as soon as practicable after receipt of the request or requests
therefor. If, however, the Company shall furnish to the party requesting such
registration a certificate signed by the President of the Company stating that,
in the good faith judgment of the Board of Directors of the Company, it would be
seriously detrimental to the Company and its shareholders for such registration
statement to be filed and it is therefore essential to defer the filing of such
registration statement, the Company shall have the right to defer such filing
for a period of not more than 120 days after receipt of the request for
registration;
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<PAGE> 7
provided, however, that the Company may not utilize this right with respect to
the particular party requesting such resignation more than once in any twelve
month period.
(d) Underwriting. If the Initiating Holders intend to distribute the
Registrable Securities covered by their request under Section 5(a) by means of
an underwriting, they shall so advise the Company as a part of their request
made pursuant to Section 5(a) and the Company shall include such information in
the written notice referred to in Section 5(a)(x). The right of any Holder to
registration pursuant to Section 5(a) shall be conditioned upon such Holder's
participation in such underwriting and the inclusion of such Holder's
Registrable Securities in the underwriting to the extent requested (unless
otherwise mutually agreed by a majority in interest of the Holders) and to the
extent provided herein.
The Company shall (together with all Holders proposing to distribute their
securities through such underwriting) enter into an underwriting agreement in
customary form with the managing underwriter selected for such underwriting by a
majority in interest of the Initiating Holders. Notwithstanding any other
provision of this Section 5, if the managing underwriter advises the Initiating
Holders in writing that marketing factors require a limitation of the number of
shares to be underwritten, then, subject to the provisions of Section 5(a), the
Company shall so advise all Holders and the number of shares of Registrable
Securities that may be included in the registration and underwriting shall be
allocated among all Holders requesting inclusion in the registration in
proportion, as nearly as practicable, to the respective amounts of Registrable
Securities held by such Holders at the time of filing the registration
statement. No Registrable Securities excluded from the underwriting by reason of
the managing underwriter's marketing limitation shall be included in such
registration.
If any Holder of Registrable Securities disapproves of the terms of the
underwriting, such person may elect to withdraw therefrom by written notice to
the Company, the managing underwriter and the other Holders. The Registrable
Securities and/or other securities so withdrawn shall also be withdrawn from
registration; provided, however, that if by the withdrawal of such Registrable
Securities a greater number of Registrable Securities held by other Holders may
be included in such registration (up to the maximum of any limitation imposed by
the underwriters), then the Company may offer to all Holders who have included
Registrable Securities in the registration the right to include additional
Registrable Securities in the same proportion used in determining the
underwriter limitation in this Section 5(d). If the registration does not become
effective due to the withdrawal of Registrable Securities, then either (1) the
Holders requesting registration shall reimburse the Company for expenses
incurred in complying with the request or (2) the aborted registration shall be
treated as effected for purposes of Section 5(a)(B).
6. Company Registration.
(a) Notice of Registration. If the Company shall determine to
register any of its securities, either for its own account or the account of a
security holder or holders exercising their respective requested registration
rights, other than (i) a registration relating solely to employee benefit plans,
(ii) a registration relating solely to a transaction pursuant to Rule 145 of the
Securities Act, (iii) a registration requested pursuant to Section 5(b) or 5(c)
hereof, or (iv) a registration on Form S-3 or Form S-4 solely for the purpose of
registering shares issued in a non-underwritten offering in connection with a
merger, combination or acquisition, the Company will:
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<PAGE> 8
(i) promptly give to each Holder written notice thereof; and
(ii) include in such registration (and any related qualification
under blue sky laws or other compliance), and in any underwriting involved
therein, all the Registrable Securities specified in a written request or
requests, made within 20 days after receipt of such written notice from the
Company, by any Holder or Holders.
(b) Underwriting. If the registration of which the Company gives
notice is for a registered public offering involving an underwriting, the
Company shall so advise the Holders as a part of the written notice given
pursuant to Section 6(a)(i). In such event, the right of any Holder to
registration pursuant to Section 6 shall be conditioned upon such Holder's
participation in such underwriting to the extent provided herein. The Company
shall (together with all Holders proposing to distribute their securities
through such underwriting) enter into an underwriting agreement in customary
form with the managing underwriter selected for such underwriting by the
Company. Notwithstanding any other provision of this Section 6, if the managing
underwriter determines that marketing factors require a limitation of the number
of shares to be underwritten, the managing underwriter may limit the Registrable
Securities and other securities to be distributed through such underwriting,
provided that the Company may limit, to the extent so advised by the
underwriters, the amount of Registrable Securities to be included in the
registration by the Holders to an amount not less than 30% of the total number
of securities included in the offering, unless such offering is the initial
public offering of the Company's securities, in which case all Registrable
Securities may be excluded from such offering. No Registrable Securities
excluded from the underwriting by reason of the managing underwriter's marketing
limitation shall be included in such registration.
If any Holder of Registrable Securities disapproves of the terms of the
underwriting, such person may elect to withdraw therefrom by written notice to
the Company, the managing underwriter and the other Holders. The Registrable
Securities and/or other securities so withdrawn shall also be withdrawn from
registration; provided, however, that if by the withdrawal of such Registrable
Securities a greater number of Registrable Securities held by other Holders may
be included in such registration (up to the maximum of any limitation imposed by
the underwriters), then the Company may offer to all Holders who have included
Registrable Securities in the registration the right to include additional
Registrable Securities in the same proportion used in determining the
underwriter limitation in this Section 6(b).
(c) In all registered public offerings, whether underwritten or not,
the amount of Registrable Securities of Holders which are included in such
registration, in accordance with the limitations set forth in Section 6(a)(ii)
above, shall be allocated to the Holders in proportion, as nearly as
practicable, to the respective amounts of Registrable Securities which would be
held by each of such Holders assuming conversion of all outstanding Series A
Preferred, Series B Preferred and Series C Preferred as of the date of the
notice given pursuant to this Section 6.
7. Expenses of Registration. All Registration Expenses incurred in
connection with any registration, qualification or compliance pursuant to
Section 5(a), Section 6 and Section 9 shall be borne by the Company. All Selling
Expenses relating to securities registered by the Holders shall be borne by the
Holders of such securities pro rata on the basis of the number of shares so
registered. Notwithstanding the foregoing, all Registration Expenses and Selling
Expenses incurred by the
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<PAGE> 9
Company in connection with a registration requested pursuant to Section 5(b) or
5(c) hereof shall be borne by the party requesting such registration.
8. Registration Procedures. In the case of each registration,
qualification or compliance effected by the Company pursuant to this Agreement
the Company will keep each Holder advised in writing as to the initiation of
each registration, qualification and compliance and as to the completion
thereof. At its expense the Company will:
(a) Prepare and file with the Commission a registration statement
with respect to such securities and use its best efforts to cause such
registration statement to become and remain effective for at least 120 days or
until the distribution described in the registration statement has been
completed; provided, however, that such one 120-day period shall be extended for
a period of time equal to the period the Holder refrains from selling any
securities included in such registration at the request of an underwriter of
Common Stock (or other securities) of the Company; provided however that, in the
case of any registration requested pursuant to Section 5(b) or 5(c), the Company
shall be obligated to use its best efforts to keep such registration statement
effective for a period of only 30 days.;
(b) Prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
with such registration statement as may be necessary to comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by such registration statement;
(c) Furnish to the Holders participating in such registration and to
the underwriters of the securities being registered such reasonable number of
copies of the registration statement, preliminary prospectus, final prospectus
and such other documents as such underwriters may reasonably request in order to
facilitate the public offering of such securities;
(d) Use its best efforts to register and qualify the securities
covered by such registration statement under such other securities or Blue Sky
laws of such jurisdictions as shall be reasonably requested by the Holders;
provided that the Company shall not be required in connection therewith or as a
condition thereto to qualify to do business or to file a general consent to
service of process in any such states or jurisdictions, unless the Company is
already subject to service in such jurisdiction and except as may be required by
the Securities Act;
(e) In the event of any underwritten public offering, enter into and
perform its obligations under an underwriting agreement, in usual and customary
form, with the managing underwriter of such offering. Each Holder participating
in such underwriting shall also enter into and perform its obligations under
such an agreement;
(f) Notify each Holder of Registrable Securities covered by such
registration statement at any time when a prospectus relating thereto is
required to be delivered under the Securities Act of the happening of any event
as a result of which the prospectus included in such registration statement, as
then in effect, includes an untrue statement of material fact or omits to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing;
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<PAGE> 10
(g) Cause such Registrable Securities registered pursuant hereunder
to be listed on each securities exchange on which similar securities issued by
the Company are then listed; and
(h) Provide a transfer agent and registrar for all Registrable
Securities registered pursuant hereunder and a CUSIP number for all such
Registrable Securities, in each case not later than the effective date of such
registration.
9. Registration on Form S-3. In addition to the rights set forth in
Section 5, if the Holders holding at least 30% of the Registrable Securities
request in writing that the Company file a registration statement on Form S-3
(or any successor thereto) for a public offering of shares of Registrable
Securities the reasonably anticipated aggregate price to the public of which
would exceed $1,000,000, and the Company is a registrant entitled to use Form
S-3 to register securities for such an offering, the Company shall use its best
efforts to cause such shares to be registered for the offering on such form (or
any successor thereto). The Company will promptly give written notice of the
request for the proposed registration to all other Holders and include all
Registrable Securities of any Holder or Holders joining in such request as are
specified in a written request received by the Company within 30 days after
receipt of such written notice from the Company. The substantive provisions of
Section 5(d) shall be applicable to each registration initiated under this
Section 9. A Holder or group of Holders is entitled to an unlimited number of
Form S-3 registrations; provided, however, that the Company shall be required to
file no more than one (1) such registration statement during any 12-month
period.
10. Termination of Registration Rights. The registration rights granted
pursuant to this Agreement shall terminate (i) as to all Holders on the fifth
anniversary of the closing of the Company's initial public offering and (ii) as
to any Holder, at such time after the Company's initial public offering as the
Registrable Securities held by such Holder represents 1% or less of the
outstanding Common Stock of the Company and such Holder is able to sell such
Registrable Securities under Rule 144 or such Holder is able to sell all
Registrable Securities held by it pursuant to Rule 144(k) promulgated under the
Securities Act.
11. Lockup Agreement. In consideration for the Company agreeing to its
obligations under this Agreement each Holder of Registrable Securities and each
transferee pursuant to Section 15 hereof agrees, in connection with the first
registration of the Company's securities, upon request of the Company or the
underwriters managing any underwritten offering of the Company's securities, not
to sell, make any short sale of, loan, grant any option for the purchase of, or
otherwise dispose of any Registrable Securities or other securities of the
Company (other than those included in the registration) without the prior
written consent of the Company or such underwriters, as the case may be, for
such period of time (not to exceed 180 days) from the effective date of such
registration as the Company or the underwriters may specify; provided, however
that all executive officers and directors of the Company must enter into similar
Lock-Up Agreements as well. Each Holder agrees that the Company may instruct its
transfer agent to place stop transfer notations in its records to enforce the
provisions of this Section 11.
12. Indemnification.
(a) The Company will indemnify each Holder, each of its officers,
directors and partners and such Holder's legal counsel and independent
accountants, and each person controlling
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<PAGE> 11
such Holder within the meaning of Section 15 of the Securities Act, with respect
to which registration, qualification or compliance has been effected pursuant to
this Agreement, and each underwriter, if any, and each person who controls any
underwriter within the meaning of Section 15 of the Securities Act, against all
expenses, claims, losses, damages and liabilities (or actions in respect
thereof), including any of the foregoing incurred in settlement of any
litigation, arising out of or based on any untrue statement (or alleged untrue
statement) of a material fact contained in any registration statement,
prospectus, offering circular or other document, or any amendment or supplement
thereto, incident to any such registration, qualification or compliance, or
based on any omission (or alleged omission) to state therein a material fact
required to be stated therein or necessary to make the statements therein, not
misleading, or any violation by the Company of any rule or regulation
promulgated under the Securities Act applicable to the Company and relating to
action or inaction required of the Company in connection with any such
registration, qualification or compliance, and will reimburse each such Holder,
each of its officers, directors and partners and such Holder's legal counsel and
independent accountants, and each person controlling such Holder, each such
underwriter and each person who controls any such underwriter, for any legal and
any other expenses reasonably incurred in connection with investigating,
preparing or defending any such claim, loss, damage, liability or action,
provided that the Company will not be liable in any such case to the extent that
any such claim, loss, damage, liability or expense arises out of or is based on
any untrue statement or omission or alleged untrue statement or omission, made
in reliance upon and in conformity with written information furnished to the
Company by an instrument duly executed by such Holder or underwriter and stated
to be specifically for use therein.
(b) Each Holder will, if Registrable Securities held by such Holder
are included in the securities as to which such registration, qualification or
compliance is being effected, indemnify the Company, each of its directors and
officers and its legal counsel and independent accountants, each underwriter, if
any, of the Company's securities covered by such a registration statement, each
person who controls the Company or such underwriter within the meaning of
Section 15 of the Securities Act, and each other such Holder, each of its
officers and directors and each person controlling such Holder within the
meaning of Section 15 of the Securities Act, against all claims, losses, damages
and liabilities (or actions in respect thereof) arising out of or based on any
untrue statement (or alleged untrue statement) of a material fact contained in
any such registration statement, prospectus, offering circular or other
document, or any omission (or alleged omission) to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, and will reimburse the Company, such Holders, such directors,
officers, legal counsel, independent accountants, underwriters or control
persons for any legal or any other expenses reasonably incurred in connection
with investigating or defending any such claim, loss, damage, liability or
action, in each case to the extent, but only to the extent, that such untrue
statement (or alleged untrue statement) or omission (or alleged omission) is
made in such registration statement, prospectus, offering circular or other
document in reliance upon and in conformity with written information furnished
to the Company by an instrument duly executed by such Holder and stated to be
specifically for use therein; provided, however, that the obligations of such
Holders hereunder shall be limited to an amount equal to the gross proceeds
before expenses and commissions to each such Holder of Registrable Securities
sold as contemplated herein.
(c) Each party entitled to indemnification under this Section 12 (the
"Indemnified Party") shall give notice to the party required to provide
indemnification (the "Indemnifying Party")
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<PAGE> 12
promptly after such Indemnified Party has actual knowledge of any claim as to
which indemnity may be sought, and shall permit the Indemnifying Party to assume
the defense of any such claim or any litigation resulting therefrom, provided
that counsel for the Indemnifying Party, who shall conduct the defense of such
claim or litigation, shall be approved by the Indemnified Party (whose approval
shall not be unreasonably withheld), and the Indemnified Party may participate
in such defense at such party's expense; provided, however, that the Indemnified
Party (together with all other Indemnified Parties that may be represented
without conflict by one counsel) shall have the right to retain one separate
counsel, with the fees and expenses to be paid by the Indemnifying Party, if
representation of such Indemnified Party by the counsel retained by the
Indemnifying Party would be inappropriate due to actual or potential differing
interests between such Indemnified Party and any other party represented by such
counsel in such proceeding; and provided further that the failure of any
Indemnified Party to give notice as provided herein shall not relieve the
Indemnifying Party of its obligations under this Agreement, except to the
extent, but only to the extent, that the Indemnifying Party's ability to defend
against such claim or litigation is impaired as a result of such failure to give
notice. No Indemnifying Party, in the defense of any such claim or litigation,
shall, except with the consent of each Indemnified Party, consent to entry of
any judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party of a release from all liability in respect to such claim or
litigation.
13. Information by Holder. The Holder or Holders of Registrable Securities
included in any registration shall furnish to the Company such information
regarding such Holder or Holders and the distribution proposed by such Holder or
Holders as the Company may request in writing and as shall be required in
connection with any registration, qualification or compliance referred to in
this Agreement.
14. Rule 144 Reporting. With a view to making available the benefits of
certain rules and regulations of the Commission which may at any time permit the
sale of the Restricted Securities to the public without registration, after such
time as a public market exists for the Common Stock of the Company, the Company
agrees to:
(a) Make and keep public information available, as those terms are
understood and defined in Rule 144 under the Securities Act, at all times after
the effective date of the first registration under the Securities Act filed by
the Company for an offering of its securities to the general public;
(b) Use its best efforts to then file with the Commission in a timely
manner all reports and other documents required of the Company under the
Securities Act and the Securities Exchange Act of 1934, as amended (at any time
after it has become subject to such reporting requirements); and
(c) Furnish to Holders of Registrable Securities forthwith upon
request, a written statement by the Company as to its compliance with the
reporting requirements of Rule 144 (at any time after 90 days after the
effective date of the first registration statement filed by the Company for an
offering of its securities to the general public), and of the Securities Act and
the Securities Exchange Act of 1934 (at any time after it has become subject to
such reporting requirements), a copy of the most recent annual or quarterly
report of the Company, and such other reports and documents of the Company as a
Holder of Registrable Securities may reasonably request in availing
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<PAGE> 13
itself of any rule or regulation of the Commission allowing such Holder to sell
any such securities without registration.
15. Transfer of Registration Rights. The right to cause the Company to
register securities granted hereunder may be assigned to a transferee or
assignee who acquires at least 500,000 shares of Series A Preferred, Series B
Preferred, Series C Preferred or Series D Preferred (or Common Stock issued on
conversion thereof) or of Subscription Shares (as adjusted for stock splits,
reverse stock splits or similar events after the date hereof including the stock
split effected in connection with the Company's reincorporation in Delaware; ie:
750,000 shares following such reincorporation), provided that the Company is
given written notice of such assignment prior to such assignment. In addition,
rights to cause the Company to register securities may be freely assigned (a) to
any constituent partner or retired partner of a Holder, where such Holder is a
partnership, (b) to any affiliate (as that term is defined in Rule 405
promulgated by the Commission under the Securities Act), (c) to any officer,
director or principal shareholder thereof, where such Holder is a corporation or
(d) to the spouse, children, grandchildren or spouse of such children or
grandchildren of any Holder or to trusts for the benefit of any Holder or such
persons where the Holder is a natural person.
16. Subsequent Grant of Registration Rights. The Company shall not grant
rights to have securities other than the Registrable Securities registered under
the Securities Act that are pari passu or superior to the registration rights
granted herein without the written consent of the holders of a majority of the
shares of Series A Preferred, Series B Preferred, Series C Preferred, Series D
Preferred (or Common Stock issued upon conversion thereof) and the Subscription
Shares (voting together as a single class on an as converted basis).
17. Company Covenants. The Company hereby covenants and agrees as follows:
17.1 Annual Financial Information. The Company will furnish to each
Purchaser for so long as such Purchaser is a holder of any Subscription Shares
or shares of Series A Preferred, Series B Preferred, Series C Preferred or
Series D Preferred purchased by such person pursuant to the Series A,B,C
Agreement or the Series D Agreement (or Common Stock issued upon conversion of
the Series A Preferred, Series B Preferred, Series C Preferred or Series D
Preferred), as soon as practicable after the end of each fiscal year, and in any
event within 90 days thereafter, consolidated balance sheets of the Company and
its subsidiaries, if any, as of the end of such fiscal year, and consolidated
statements of income and consolidated statements of cash flows of the Company
and its subsidiaries, if any, for such year, prepared in accordance with
generally accepted accounting principles consistently applied and setting forth
in each case in comparative form the figures for the previous fiscal year, all
in reasonable detail and certified by independent public accountants of national
standing selected by the Company.
17.2 Quarterly Financial Information and Financial Plan. The Company
will furnish the following reports to each Purchaser for so long as such
Purchaser is a holder of at least 500,000 shares of Subscription Shares, Series
A Preferred, Series B Preferred, Series C Preferred or Series D Preferred (or
Common Stock issued upon conversion of Series A Preferred, Series B Preferred,
Series C Preferred or Series D Preferred or a combination of such Series A
Preferred, Series B Preferred, Series C Preferred and Common Stock) (adjusted
for stock splits, reverse stock
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<PAGE> 14
splits or similar events after the date hereof including the stock split
effected in connection with the Company's reincorporation in Delaware; ie:
750,000 shares following such reincorporation).
(a) As soon as practicable after the end of each fiscal quarter
(except for the fiscal quarter ending December 31 of each year), and in any
event with 45 days thereafter, consolidated balance sheets of the Company and
its subsidiaries, if any, as of the end of such quarter, and cash flow
statements and consolidated statements of income for each quarter and for the
current fiscal year to date, prepared in accordance with generally accepted
accounting principles consistently applied, all in reasonable detail and signed,
subject to changes resulting from year-end audit adjustments, by the principal
financial or accounting officer of the Company, together with a comparison of
such statements to the Company's operating plan then in effect and approved by
its Board of Directors.
(b) As soon as available (but in any event within 10 days after the
commencement of its fiscal year), a summary of the financial plan of the Company
for each fiscal year, including (but not limited to) a cash flow projection and
operating budget, calculated monthly, as contained in its operating plan
approved by the Company's Board of Directors.
17.3 Assignment of Rights to Financial Information. The rights to
receive information pursuant to Section 17.1 may be assigned or otherwise
conveyed by any Purchaser or subsequent transferee to any transferee of shares
of Subscription Shares, Series A Preferred, Series B Preferred, Series C
Preferred or Series D Preferred (or Common Stock issued upon conversion
thereof). The rights specified in Section 17.2 may be assigned or otherwise
conveyed by a Purchaser or subsequent transferee only to a transferee who
acquires at least 500,000 shares of Subscription Shares, Series A Preferred,
Series B Preferred, Series C Preferred or Series D Preferred (or Common Stock
issued upon conversion thereof) (adjusted for stock splits, reverse stock splits
or similar events after the date hereof including the stock split effected in
connection with the Company's reincorporation into Delaware as described above).
17.4 Inspection. The Company shall permit each Prior Purchaser for so
long as such Prior Purchaser is eligible to receive reports under Section 17.2
at such Prior Purchaser's expense, to visit and inspect the Company's
properties, to examine its books of account and records and to discuss the
Company's affairs, finances and accounts with its officers, all at such
reasonable times as may be requested by the Prior Purchaser; provided, however,
that the Company shall not be obligated pursuant to this Section 17.4 to provide
access to any information which it reasonably considers to be a trade secret or
similar confidential information.
17.5 Confidentiality Agreement. Each Purchaser and any successor or
assign of such Purchaser, who receives from the Company or its agents, directly
or indirectly, any information which the Company has not made generally
available to the public, pursuant to the preparation and execution of this
Agreement or disclosure in connection therewith or pursuant to the provisions of
this Section 17, acknowledges and agrees that such information is confidential
and for its use only in connection with evaluating its investment in the
Company, and further agrees that it will not disseminate such information to any
person other than its accountant, investment advisor or attorney and that such
dissemination shall be only for purposes of evaluating its investment.
-14-
<PAGE> 15
17.6 Termination of Covenants. Notwithstanding anything to the
contrary set forth herein, the covenants set forth in this Section 17 shall
terminate and be of no further force or effect after the date upon which the
first registration statement filed by the Company under the Securities Act in
connection with an underwritten public offering of its securities first becomes
effective ("IPO").
18. Rights of First Refusal. The Company hereby grants to each Prior
Purchaser who holds at least 600,000 shares of Registrable Securities the right
of first refusal to purchase its pro rata share of "New Securities" (as defined
in this Section 18) that the Company may, from time to time propose to sell and
issue. Such pro rata share, for purposes of this right of first refusal, is the
ratio of (X) the number of shares of Common Stock immediately prior to the
issuances of New Securities then owned by such Purchaser or issuable upon the
conversion of the Series A Preferred, Series B Preferred, Series C Preferred or
Series D Preferred then owned by such Prior Purchaser (including shares issuable
upon exercise of options or warrants held by such Purchaser), to (Y) the total
number of shares of Common Stock immediately prior to the issuances of New
Securities then outstanding, after giving effect to the conversion of all
outstanding convertible securities (including the Series A Preferred Stock,
Series B Preferred, Series C Preferred and Series D Preferred) and the exercise
of all outstanding options. This right of first refusal shall be subject to the
following provisions:
(a) "New Securities" shall mean any Common Stock and Preferred Stock
of the Company whether or not authorized on the date hereof, and rights,
options, or warrants to purchase Common Stock or Preferred Stock and securities
of any type whatsoever that are, or may become, convertible into Common Stock or
Preferred Stock; provided, however, that "New Securities" does not include the
following:
(i) the Series A Preferred, the Series B Preferred, the Series
C Preferred or any agreement or commitment to issue any of the foregoing;
(ii) shares of Common Stock, or options to purchase shares of
Common Stock (including all options granted by the Company prior to the date of
this Agreement), issued or granted to officers, directors and employees of, or
consultants to, the Company pursuant to a stock grant, employee restricted stock
purchase agreement, option plan or purchase plan or other stock incentive
program (collectively, the "Plans");
(iii) shares of Common Stock issuable upon conversion of the
Series A Preferred, Series B Preferred and Series C Preferred;
(iv) securities of the Company offered to the public pursuant
to a firm commitment underwritten public offering pursuant to a registration
statement filed under the Securities Act;
(v) securities of the Company issued pursuant to the
acquisition of another corporation by the Company by merger, purchase of
substantially all of the assets, or other reorganization whereby the Company
owns more than fifty percent (50%) of the voting power of such other
corporation;
-15-
<PAGE> 16
(vi) securities of the Company issued in connection with
equipment lease financing transactions, real estate leases or bank financing
transactions the principal purpose of which is not to raise equity funding;
(vii) securities issued to corporate partners or in connection
with other strategic alliances if the Board of Directors agrees that such
transaction should be excluded from operation of this Section 18; and
(viii) shares of Common Stock or Preferred Stock issued in
connection with any stock split, stock dividend, or recapitalization by the
Company.
(b) In the event that Company proposes to undertake an issuance of
New Securities, it shall give each Prior Purchaser written notice of its
intention, describing the type of New Securities, the price, and the general
terms upon which the Company proposes to issue the same. Each Prior Purchaser
shall have twenty (20) business days after receipt of such notice to agree to
purchase its pro rata share of such New Securities at the price and upon the
terms specified in the notice by giving written notice to the Company and
stating therein the quantity of New Securities to be purchased. If any Prior
Purchaser fails to agree to purchase its full pro rata share within such twenty
(20) business day period, the Company shall give the Prior Purchasers who did so
agree (the "Electing Purchasers") notice of the number of shares which were not
subscribed for. Such notice may be by telephone if followed by written
confirmation within two days. The Electing Purchasers shall have five (5)
business days from the date of such notice to agree to purchase their pro rata
share of all of the New Securities not purchased by such non-purchasing
Purchasers.
(c) In the event that Prior Purchasers fail to exercise in full the
right of first refusal within the twenty (20) business day plus five (5)
business day period specified above, the Company shall have one hundred twenty
(120) days thereafter to sell (or enter into an agreement pursuant to which the
sale of New Securities covered thereby shall be closed, if at all, within sixty
(60) days from the date of said agreement) the New Securities respecting which
the rights of the Prior Purchasers were not exercised at a price and upon terms
no more favorable to the purchasers thereof than specified in the Company's
notice. In the event the Company has not sold the New Securities within such one
hundred twenty (120) day period (or sold and issued New Securities in accordance
with the foregoing within sixty (60) days from the date of such agreement) the
Company shall not thereafter issue or sell any New Securities, without first
offering such New Securities to the Prior Purchasers and in the manner provided
above.
(d) The right of first refusal granted under this Section 18 shall
expire upon an IPO.
(e) This right of first refusal is nonassignable except to any
transferee to whom registration rights may be transferred pursuant to Section 15
of this Agreement.
19. Governing Law. This Agreement and the legal relations between the
parties arising hereunder shall be governed by and interpreted in accordance
with the laws of the State of California. The parties hereto agree to submit to
the jurisdiction of the federal and state courts of the State of California with
respect to the breach or interpretation of this Agreement or the enforcement
-16-
<PAGE> 17
of any and all rights, duties, liabilities, obligations, powers, and other
relations between the parties arising under this Agreement.
20. Entire Agreement. This Agreement constitutes the full and entire
understanding and agreement between the parties regarding rights to
registration. Except as otherwise expressly provided herein, the provisions
hereof shall inure to the benefit of, and be binding upon, the successors,
assigns, heirs, executors and administrators of the parties hereto. This
Agreement shall supersede and cancel all prior agreements between the parties
hereto with regard to the subject matter hereof, including, but not limited to,
the Prior Rights Agreement.
21. Notices, etc. All notices and other communications required or
permitted hereunder shall be in writing and shall be deemed effectively given
upon delivery to the party to be notified in person by facsimile or by courier
service or five days after deposit with the United States mail, by registered or
certified mail, postage prepaid, addressed (a) if to a Purchaser, at such
Purchaser's address set forth in Exhibit A, or at such other address as such
Purchaser shall have furnished to the Company in writing, or (b) if to any other
holder of any Shares, at such address as such holder shall have furnished the
Company in writing, or, until any such holder so furnishes an address to the
Company, then to and at the address of the last holder of such Shares who has so
furnished an address to the Company, or (c) if to the Company, one copy should
be sent to its address and facsimile number set forth at the end of this
Agreement and addressed to the attention of the Corporate Secretary, or at such
other address as the Company shall have furnished to the Purchasers (with a copy
to Judith M. O'Brien, Wilson Sonsini Goodrich & Rosati, 650 Page Mill Road, Palo
Alto, California 94304; facsimile: (650) 493-6811).
22. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
23. Additional Parties. The parties to this Agreement acknowledge that the
Company's Preferred Stock may be sold in multiple closings pursuant to the
Purchase Agreement, and the parties hereto agree that all of the purchasers of
Preferred Stock pursuant to the Purchase Agreement can be added as parties to
this Agreement and granted all of the rights of Purchasers under this Agreement
without any further action or approval by other parties to this Agreement.
24. Amendment. Any provision of this Agreement may be amended, waived or
modified upon the written consent of the Company and the Holders of a majority
of the Registrable Securities. Any amendment or waiver effected in accordance
with this Section shall be binding upon each Holder of Registrable Securities
and the Company. Any Purchaser may waive any of its rights or the Company's
obligations hereunder without obtaining the consent of any other person.
25. Headings. Headings and the table of contents in this Agreement are for
reference purposes only and shall not be deemed to have an substantive effect.
-17-
<PAGE> 18
IN WITNESS WHEREOF, the undersigned have executed this Third Amended and
Restated Shareholder Rights Agreement as of the date set forth above.
"COMPANY"
AVANEX CORPORATION
By: /s/ WALTER ALESSANDRINI
-------------------------------------
Walter Alessandrini,
Chief Executive Officer
Address: 42501 Albrae Avenue
Fremont, CA 94538
[SIGNATURE PAGE THIRD AMENDED AND RESTATED SHAREHOLDER RIGHTS AGREEMENT]
<PAGE> 19
"PURCHASERS"
SEQUOIA CAPITAL FRANCHISE FUND
SEQUOIA CAPITAL FRANCHISE PARTNERS
SEQUOIA CAPITAL VII
a California Limited Partnership
SEQUOIA TECHNOLOGY PARTNERS VII
a California Limited Partnership
SQP 1997
SEQUOIA 1997 LLC
SEQUOIA INTERNATIONAL PARTNERS
By: SC VII-A Management, LLC
A California Limited Liability Company,
its General Partner
By: /s/ MICHAEL GOGUEN
------------------------------------
Michael Goguen
Managing Member
[SIGNATURE PAGE THIRD AMENDED AND RESTATED SHAREHOLDER RIGHTS AGREEMENT]
<PAGE> 20
CROSSPOINT VENTURE PARTNERS 1997
By: /s/ Seth Neiman
-------------------------------------
Seth Neiman
Partner
CROSSPOINT VENTURE PARTNERS LS 1999
By: /s/ Seth Neiman
-------------------------------------
Seth Neiman
Partner
[SIGNATURE PAGE THIRD AMENDED AND RESTATED SHAREHOLDER RIGHTS AGREEMENT]
<PAGE> 21
MAYFIELD IX
A Delaware Limited Partnership
By: /s/ Todd Brooks
-------------------------------------
Mayfield IX Management, L.L.C.
Its General Partner
MAYFIELD ASSOCIATES FUND IV
A Delaware Limited Partnership
By: /s/ Todd Brooks
-------------------------------------
Mayfield IX Management, L.L.C.
Its General Partner
[SIGNATURE PAGE THIRD AMENDED AND RESTATED SHAREHOLDER RIGHTS AGREEMENT]
<PAGE> 22
JAFCO CO., LTD.
By: /s/ Barry Schiffman
-------------------------------------
JAFCO America Ventures, Inc.
Its General Partner
JAFCO R-3 INVESTMENT ENTERPRISE
PARTNERSHIP
By: /s/ Barry Schiffman
-------------------------------------
JAFCO America Ventures, Inc.
Its Executive Partner
JAFCO JS-3 INVESTMENT ENTERPRISE
PARTNERSHIP
By: /s/ Barry Schiffman
-------------------------------------
JAFCO America Ventures, Inc.
Its Executive Partner
JAFCO G6-(A) INVESTMENT ENTERPRISE
PARTNERSHIP
By: /s/ Barry Schiffman
-------------------------------------
JAFCO America Ventures, Inc.
Its Executive Partner
JAFCO G6-(B) INVESTMENT ENTERPRISE
PARTNERSHIP
By: /s/ Barry Schiffman
-------------------------------------
JAFCO America Ventures, Inc.
Its Executive Partner
U.S. INFORMATION TECHNOLOGY NO. 2
INVESTMENT ENTERPRISE PARTNERSHIP
By: /s/ Barry Schiffman
-------------------------------------
JAFCO Co., Ltd.
Its Executive Partner
[SIGNATURE PAGE THIRD AMENDED AND RESTATED SHAREHOLDER RIGHTS AGREEMENT]
<PAGE> 23
WS INVESTMENT 98
By: /s/ JUDITH M. O'BRIEN
-------------------------------------
Partner
WS INVESTMENT 99B
By: /s/ JUDITH M. O'BRIEN
-------------------------------------
Partner
BRADFORD C. O'BRIEN AND JUDITH M.
O'BRIEN, TRUSTEES OF THE O'BRIEN FAMILY
TRUST U/D/T DATED 7/1/92
By: /s/ JUDITH M. O'BRIEN
-------------------------------------
Judith M. O'Brien
BRUCE MCNAMARA
----------------------------------------
ALISANDE M. ROZYNKO AND WILLIAM C. NIETO
AS COMMUNITY PROPERTY
----------------------------------------
THOMAS I. SAVAGE AND JANET S. KIM JTWROS
/s/ THOMAS I. SAVAGE
----------------------------------------
/s/ JANET S. KIM
----------------------------------------
IRWIN GROSS
----------------------------------------
[SIGNATURE PAGE THIRD AMENDED AND RESTATED SHAREHOLDER RIGHTS AGREEMENT]
<PAGE> 24
MICROSOFT CORPORATION
By: /s/ JOHN CONNORS
-------------------------------------
Name: John Connors
Title: SUP-CFO
[SIGNATURE PAGE THIRD AMENDED AND RESTATED SHAREHOLDER RIGHTS AGREEMENT]
<PAGE> 25
MCI WORLDCOM VENTURE FUND
By: /s/ DOUGLAS C. WEBSTER
-------------------------------------
Name: Douglas C. Webster
Title: Vice President
[SIGNATURE PAGE THIRD AMENDED AND RESTATED SHAREHOLDER RIGHTS AGREEMENT]
<PAGE> 1
EXHIBIT 23.1
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" and to
the use of our report dated January 14, 2000, included in Amendment No. 3 to the
Registration Statement (Form S-1 No. 333-92097), and related prospectus of
Avanex Corporation for the registration of shares of its common stock.
Our audits also included the financial statement schedule of Avanex
Corporation listed in Schedule II. The schedule is the responsibility of the
Company's management. Our responsibility is to express our opinion based on our
audits. In our opinion, the financial statement schedule referenced to above,
when considered in relation to the basic financial statements taken as a whole,
presents fairly in all material respects the information set forth herein.
Ernst & Young LLP
San Jose, California
January 20, 2000
