<PAGE> 1
As filed with the Securities and Exchange Commission on May 18, 2000
Registration No. 333-_____
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
NEW FOCUS, INC.
(Exact name of Registrant as specified in its charter)
<TABLE>
<S> <C>
Delaware 33-0404910
(State of Incorporation) (I.R.S. Employer Identification Number)
</TABLE>
2630 Walsh Avenue
Santa Clara, California 95051-0905
(Address of Principal Executive Offices)
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1990 INCENTIVE STOCK OPTION PLAN
1998 STOCK PLAN
1999 STOCK PLAN
2000 STOCK PLAN
2000 EMPLOYEE STOCK PURCHASE PLAN
2000 DIRECTOR OPTION PLAN
(Full title of the plans)
---------------
Kenneth E. Westrick
President and Chief Executive Officer
NEW FOCUS, INC.
2630 Walsh Avenue
Santa Clara, California 95051-0905
(Name and address of agent for service)
(408) 980-8088
(Telephone number, including area code, of agent for service)
---------------
Copy to:
Judith M. O'Brien
WILSON SONSINI GOODRICH & ROSATI, P.C.
650 Page Mill Road
Palo Alto, California 94304
Telephone: (650) 493-9300
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<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
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AMOUNT PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE SECURITIES TO TO BE OFFERING PRICE AGGREGATE OFFERING AMOUNT OF
BE REGISTERED REGISTERED PER SHARE (1) PRICE REGISTRATION FEE
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<S> <C> <C> <C> <C>
Options and underlying Common Stock issued
under the 1990 Incentive Stock Option Plan(1) 2,352,145 $ 0.30 $ 705,644 $ 186.29
Options and underlying Common Stock issued
under the 1998 Stock Plan(1) 746,435 $ 9.98 $ 7,449,421 $ 1,966.65
Options and underlying Common Stock issued
under the 1999 Stock Plan(1) 2,289,709 $ 3.13 $ 7,166,789 $ 1,892.03
Common Stock to be issued under the 2000
Stock Plan(2) 1,888,145 $20.00 $37,762,900 $ 9,969.41
Common Stock to be issued under the 2000
Employee Stock Purchase Plan(3) 1,000,000 $17.00 $17,000,000 $ 4,488.00
Common Stock to be issued under the 2000
Director Option Plan(2) 200,000 $20.00 $ 4,000,000 $ 1,056.00
----------- ----------
TOTAL: $74,084,754 $19,558.38
</TABLE>
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(1) Estimated in accordance with Rule 457(h) promulgated under the Securities
Act of 1933, as amended, solely for the purpose of calculating the amount
of the registration fee based on the weighted average exercise price per
share covering authorized and outstanding options and underlying Common
Stock under the 1990 Incentive Stock Option Plan, the 1998 Stock Plan and
the 1999 Stock Plan.
(2) Estimated in accordance with Rule 457(h) promulgated under the Securities
Act of 1933, as amended, solely for the purpose of calculating the amount
of the registration fee based on the initial public offering price of the
Common Stock.
(3) Estimated in accordance with Rule 457(h) promulgated under the Securities
Act, as amended, solely for the purpose of calculating the amount of the
registration fee based upon 85% of the initial public offering price of the
Common Stock (the price at which Common Stock may be sold to employees
pursuant to terms of this plan).
2
<PAGE> 3
NEW FOCUS, INC.
REGISTRATION STATEMENT ON FORM S-8
PART II
INFORMATION REQUIRED IN REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
---------------------------------------
There are hereby incorporated by reference in this Registration Statement
the following documents and information heretofore filed with the Securities and
Exchange Commission:
1. The Company's Prospectus filed May 18, 2000 pursuant to Rule 424(B)(4)
of the Securities Act of 1933, as amended (the "Securities Act") relating to the
Company's initial public offering of its Common Stock.
2. The description of the Company's Common Stock contained in the
Company's Registration Statement on Form 8-A dated March 6, 2000, filed
pursuant to Section 12 of the Securities Exchange Act of 1934 (the "Exchange
Act"), and any further amendment or report filed hereafter for the purpose of
updating such description.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14
and 15(d) of the Exchange Act on or after the date of this Registration
Statement and prior to the filing of a post-effective amendment which indicates
that all securities offered have been sold or which deregisters all securities
then remaining unsold shall be deemed to be incorporated by reference in this
Registration Statement and to be part hereof from the date of filing of such
documents.
ITEM 4. DESCRIPTION OF SECURITIES.
-------------------------
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
--------------------------------------
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
-----------------------------------------
Section 145(a) of the Delaware General Corporation Law (the "DGCL")
provides in relevant part that "[a] corporation may indemnify any person who was
or is a party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the corporation) by
reason of the fact that he is or was a director, officer, employee or agent of
the corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the corporation, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his conduct was unlawful".
With respect to derivative actions, Section 145(b) of the DGCL provides in
relevant part that "[a] corporation may indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
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completed action or suit by or in the right of the corporation to procure a
judgment in its favor...[by reason of his service in one of the capacities
specified in the preceding sentence] against expenses (including attorneys'
fees) actually and reasonably incurred by him in connection with the defense or
settlement of such action or suit if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation and except that no indemnification shall be made in respect of any
claim, issue or matter as to which such person shall have been adjudged to be
liable to the corporation unless and only to the extent that the Court of
Chancery or the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the Court of Chancery or such other court
shall deem proper."
Article X of the Company's Certificate of Incorporation provides for the
indemnification of directors to the fullest extent permissible under Delaware
law.
Article VI of the Company's Bylaws provides for the indemnification of
officers, directors and third parties acting on behalf of the Company if such
person acted in good faith and in a manner reasonably believed to be in and not
opposed to the best interest of the Company, and, with respect to any criminal
action or proceeding, the indemnified party had no reason to believe his or her
conduct was unlawful.
The Company has entered into indemnification agreements with its directors
and executive officers, in addition to indemnification provided for in the
Company's Bylaws, and intends to enter into indemnification agreements with any
new directors and executive officers in the future.
The Company carries officer and director liability insurance with respect
to certain matters, including matters arising under the Securities Act.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable.
ITEM 8. EXHIBITS.
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<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
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<S> <C>
4.1* 2000 Stock Plan
4.2* 2000 Employee Stock Purchase Plan
4.3* 2000 Director Option Plan
4.4 1990 Incentive Stock Option Plan
4.5 1998 Stock Plan
4.6 1999 Stock Plan
5.1 Opinion of counsel as to legality of securities being registered
23.1 Consent of Independent Accountant
23.2 Consent of counsel (contained in Exhibit 5.1)
24.1 Power of Attorney (see page II-5)
</TABLE>
________________________________
* Incorporated by reference to the Registration Statement on Form S-1, as
amended (Commission File No. 333-31396), declared effective by the Securities
and Exchange Commission on May 17, 2000.
ITEM 9. UNDERTAKINGS.
------------
A. The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement to include any
material information with respect to the plan of
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distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act, such post-effective amendment 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.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
B. The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the registration statement 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.
C. Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the registrant pursuant to the foregoing provisions, 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 controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, 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.
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<PAGE> 6
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto, duly
authorized, in the City of Santa Clara, State of California, on May 17, 2000.
NEW FOCUS, INC.
By: /s/ KENNETH E. WESTRICK
--------------------------------------
Kenneth E. Westrick, President and
Chief Executive Officer
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POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Kenneth E. Westrick and William Potts,
and each of them, their true and lawful attorneys and agents, with full power of
substitution, each with power to act alone, to sign and execute on behalf of the
undersigned any amendment or amendments to this Registration Statement on Form
S-8 and to perform any acts necessary in order to file such amendments, and each
of the undersigned does hereby ratify and confirm all that said attorneys and
agents, or their or his substitutes, shall do or cause to be done by virtue
hereof. 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.
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed on May 17, 2000 by the following persons in the
capacities indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE
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<S> <C>
/s/ Kenneth E. Westrick Director, President and Chief Executive Officer
- ------------------------------ (Principal Executive Officer)
Kenneth E. Westrick
/s/ William L. Potts, Jr. Chief Financial Officer (Principal Financial and Accounting Officer)
- ------------------------------
William L. Potts, Jr.
Director
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Dr. David L. Lee
Director
- ------------------------------
Dr. Milton Chang
/s/ John Dexheimer Director
- ------------------------------
John Dexheimer
/s/ Winston Fu Director
- ------------------------------
Dr. Winston Fu
/s/ R. Clark Harris Director
- ------------------------------
R. Clark Harris
/s/ Robert D. Pavey Director
- ------------------------------
Robert D. Pavey
/s/ Kenneth E. Westrick Director
- ------------------------------
Kenneth E. Westrick
</TABLE>
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<PAGE> 8
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
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<S> <C>
4.1* 2000 Stock Plan
4.2* 2000 Employee Stock Purchase Plan
4.3* 2000 Director Option Plan
4.4 1990 Incentive Stock Option Plan
4.5 1998 Stock Plan
4.6 1999 Stock Plan
5.1 Opinion of counsel as to legality of securities being registered
23.1 Consent of Independent Accountant
23.2 Consent of counsel (contained in Exhibit 5.1)
24.1 Power of Attorney (see page II-5)
</TABLE>
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* Incorporated by reference to the Registration Statement on Form S-1, as
amended (Commission File No. 333-31396), declared effective by the Securities
and Exchange Commission on May 17, 2000.
<PAGE> 1
EXHIBIT 4.4
NEW FOCUS, INC.
1990 INCENTIVE STOCK PLAN
(AS AMENDED MAY 4, 1998)
1. Purposes of the Plan. The purposes of this Stock Plan are to attract
and retain the best available personnel, to provide additional incentive to the
Employees of New Focus, Inc. (the "Company") and to promote the success of the
Company's business.
Options granted hereunder may be either Incentive Stock Options or
Nonstatutory Stock Options, at the discretion of the Board and as reflected in
the terms of the written option agreement. The Board also has the discretion to
grant Stock Purchase Rights.
2. Definitions. As used herein, the following definitions shall apply:
(a) "Administrator" means the Board or any of its Committees
appointed pursuant to Section 4 of the Plan.
(b) "Board" means any Committees if one has been appointed by the
Board in accordance with paragraph (a) of Section 4 of the Plan, or the Board of
Directors of the Company, if no Committee is appointed.
(c) "Code" means the Internal Revenue Code of 1986, as amended.
(d) "Company" means New Focus, Inc., a California corporation.
(e) "Committee" means the Committee appointed by the Board of
Directors in accordance with Section 4(a) of the Plan, if one is appointed.
(f) "Consultant" means any person performing services for the
benefit of the Company or any Parent or Subsidiary as a director, an independent
consultant or advisor; provided that if and in the event the Company registers
any class of any equity security pursuant to Section 12 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), the term Consultant shall
thereafter not include directors who are not compensated for their services or
are paid only a director's fee by the Company.
(g) "Continuous Status as an Employee or Consultant" means the
absence of any interruption or termination of the employment or consulting
relationship, as applicable. Continuous Status as an Employee or Consultant
shall not be considered interrupted in the case of: (i) sick leave; (ii)
military leave; (iii) any other for a period of not more than 90 days or
reemployment upon the expiration of such leave is guaranteed by contract or
statute or unless otherwise provided pursuant to formal policy adopted from time
to time by the Company and issued and promulgated to Employees in writing; or
(iv) in the case of transfers between locations of the Company or between the
Company, its Parent or its Subsidiaries.
<PAGE> 2
(h) "Employee" means any person, including officers and directors,
employed by the Company or any Parent or Subsidiary of the Company. The payment
of a director's fee by the Company shall not be sufficient to constitute
"employment", by the Company.
(i) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
(j) "Fair Market Value" means the value of Common Stock determined
as follows:
(i) The Common Stock is listed on any established stock
exchange or a national market system, included without limitation, the National
Market System of the National Association of Securities Dealers, Inc. Automated
Quotation ("NASDAQ") System, its Fair Market Value shall be the closing sales
price for such stock where the closing bid, if no sales were reported, as quoted
on such system or exchange (or the exchange with the greatest volume of trading
in common stock) for the last trading day prior to the time of determination, as
reported in the Wall Street Journal or such other source as the Administrator
deems reliable.
(ii) If the Common Stock is quoted on the NASDAQ System
(but not on the National Market System thereof) or regularly quoted by a
recognized securities dealer but selling prices are not reported, its Fair
Market Value shall be the mean between the high and low asked prices for the
Common Stock for the last day on which there are quoted prices prior to the time
of determination, or;
(iii) In the absence of an established market for the
Common Stock, the Fair Market Value shall be determined in good faith by the
Administrator.
(k) "Incentive Stock Option" means an Option intended to qualify as
an incentive stock option within the meaning of Section 422A of the Code.
(l) "Nonstatutory Stock Option" means an Option not intended to
qualify as an Incentive Stock Option.
(m) "Option" means a stock option granted pursuant to the Plan.
(n) "Optioned Stock" means the Stock subject to an Option.
(o) "Optionee" means an Employee or Consultant who receives an
Option.
(p) "Parent" means a "parent corporation," whether now or hereafter
existing, as defined in Section 425(e) of the Code.
(q) "Plan" means this 1990 Incentive Stock Plan.
(r) "Purchaser" means an Employee or Consultant who exercises a
Stock Purchase Right.
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<PAGE> 3
(s) "Share" means a share of the Stock, as adjusted in accordance
with Section II of the Plan.
(t) "Stock" means the Common Stock of the Company.
(u) "Stock Purchase Right" means a right to purchase Stock pursuant
to the Plan or the right to receive a bonus of stock for past services rendered.
(v) "Subsidiary" means a "subsidiary corporation," whether now or
hereafter existing, as defined in Section 425(f) of the Code.
In addition, the term "Rule 16b-3" and the term "Insiders" shall have the
meaning set forth, respectively, in Sections 4 and 8 below.
3. Stock Subject to the Plan. Subject to the provisions of Section II of
the Plan, the maximum aggregate number of shares under the Plan is TWO MILLION
FOUR HUNDRED THOUSAND SEVENTY-FIVE (2,475,000) shares of Stock. The Shares may
be authorized, but unissued, or reacquired Stock.
If an Option or Stock Purchase Right should expire or become
unexercisable for any reason without having been exercised in full, the
unpurchased Shares which were subject thereto shall, unless the Plan shall have
been terminated, become available for future grant or sale under the Plan.
Shares issued under the Plan and later repurchased by the Company in connection
with the Company's right to repurchase unvested shares shall become available
for future grant or sale under the Plan.
4. Administration of the Plan. The Plan shall be administered by the
Board.
(a) Administration Prior to Registration. Subject to subsection (b),
the Board may appoint a Committee consisting of not less than two members of the
Board, to administer the Plan on behalf of the Board, subject to such terms and
conditions as the Board may prescribe. Once appointed, the Committee shall
continue to serve until otherwise directed by the Board. Members of the Board
who are either eligible for Options or Stock Purchase Rights or who have been
granted Options or Stock Purchase Rights may vote on any matters affecting the
administration of the Plan or the grant of any Options or Stock Purchase Rights
pursuant to the Plan, except that no such member shall act upon the granting of
an Option or Stock Purchase Right to himself or herself, but any such member may
be counted in determining the existence of a quorum at any meeting of the Board
or Committee during which action is taken with respect to the granting of
Options or Stock Purchase Rights to said Board or Committee member.
(b) Administration After Registration. Notwithstanding the foregoing
subparagraph (i), if and in any event the Company registers any class of any
equity security pursuant to Section 12 of the Exchange Act, from the effective
date of such registration until six months after the termination of such
registration, the Plan shall be administered as follows:
(i) Administration With Respect to Directors and Officers.
With respect to grants of Options or Stock Purchase Rights to Employees who are
also officers and directors of
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the Company, the Plan shall be administered by (A) the Board, if the Board may
administer the Plan in compliance with Rule 16b-3 promulgated under the Exchange
Act, or any successor rule thereto ("Rule 16b-3"), with respect to a plan
intended to qualify under Rule 16b-3 as a discretionary plan, or (B) a Committee
designated by the Board to administer the Plan, which Committee shall be
constituted in such a manner as to permit the Plan to comply with Rule 16b-3
with respect to a plan intended to qualify thereunder as a discretionary plan.
Once appointed, such Committee shall continue to serve in its designated
capacity until otherwise directed by the Board. From time to time the Board may
increase the size of the Committee and appoint additional members thereof,
remove members (with or without cause) and appoint new members in substitution
therefor, fill vacancies, however caused, and remove all members of the
Committee and thereafter directly administer the Plan, all to the extent
permitted by Rule 16b-3 with respect to a plan intended to qualify thereunder as
a discretionary plan.
(ii) Multiple Administrative Bodies. If permitted by
Rule 16b-3, the Plan may be administered by different bodies with respect to
directors, non-director officers and Employees who are neither directors nor
officers.
(iii) Administration With Respect to Other Employees.
With respect to grants of Options or Stock Purchase Rights to Employees who are
neither directors nor officers of the Company, the Plan shall be administered by
(A) the Board or (B) a Committee designated by the Board, which Committee shall
be constituted in such a manner as to satisfy the legal requirements relating to
the administration of incentive stock option plans, if any, of California
corporate and securities laws and of the Code (the "Applicable Laws"). Once
appointed, such Committee shall continue to serve in its designated capacity
until otherwise directed by the Board. From time to time The Board may increase
the size of the Committee and appoint additional members thereof, remove members
(with or without cause) and appoint new members in substitution therefor, fill
vacancies, however caused, and remove all members of the Committee and
thereafter directly administer the Plan, all to the extent permitted by the
Applicable Laws.
(c) Powers of the Board. Subject to the provisions of the Plan and,
in the case of a Committee, the specific duties delegated by the Board to such
Committee, the Administrator shall have the authority, in its discretion: (i) to
grant Incentive Stock Options, Nonstatutory Stock Options or Stock Purchase
Rights; (ii) to determine, in accordance with Section 1(j) of the Plan, the Fair
Market Value of the Stock; (iii) to determine the exercise price per Share of
Options, or Stock Purchase Rights, to be granted, which exercise pro shall be
determined in accordance with Section 7 of the Plan; (iv) to determine the
Employees and Consultants to whom, and the time or times at which, Options or
Stock Purchase Rights shall be granted and the number of Shares to be
represented by each Option or Stock Purchase Right; (v) to interpret the Plan;
(vi) to prescribe, amend and rescind rules and regulations relating to the Plan;
(vii) to determine the terms and provisions of each Option or Stock Purchase
Right granted (which need not be identical) and, with the consent of the holder
thereof, modify or amend each Option or Stock Purchase Right; (viii) to
accelerate or defer (with the consent of the Optionee) the exercise date of any
Option, consistent with the provisions of Section 5 of the Plan; (ix) to reduce
the exercise price of any Option to the then current Fair Market Value if the
Fair Market Value of the Common Stock covered by such Option shall have declined
since the date the Option was granted; (x) to authorize any person to execute on
behalf of the Company any instrument required to effectuate the grant of an
Option or
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<PAGE> 5
Stock Purchase Right previously granted by the Administrator; and (xi) to make
all other determinations deemed necessary or advisable for the administration of
the Plan.
(d) Effect of Decisions by the Administrator. All decisions,
determinations and interpretations of the Administrator shall be final and
binding on all Optionees, Purchasers and any other holders of any Options or
Stock Purchase Rights granted under the Plan.
5. Eligibility.
(a) Options and Stock Purchase Rights may be granted to Employees
and Consultants, provided that Incentive Stock options may only be granted to
Employees. An Employee or Consultant who has been granted an Option or Stock
Purchase Right may, if he is otherwise eligible, be granted additional option(s)
or Stock Purchase Right(s).
(b) Each Option or Stock Purchase Right shall be evidenced by a
written agreement, which, in the case of an Option, shall expressly identify the
Option as an incentive stock option or as a nonstatutory stock option, and which
shall be in such form and contain such provisions as the Administrator shall
from time to time deem appropriate. However, notwithstanding such designation,
to the extent that the aggregate Fair Market Value of (i) the Shares with
respect to which Options designated as incentive stock options plus (ii) the
shares of stock of the Company, Parent and any Subsidiary with respect to which
other incentive stock options are exercisable for the first time by an Optionee
during any calendar year under all plans of the Company and any Parent and
Subsidiary exceed $100,000, such excess options shall be treated as nonstatutory
stock options. For purposes of the preceding sentence, (i) Options shall be
taken into account in the order in which they were granted, and (ii) the Fair
Market Value of the Shares shall be determined as of the time the Option or
other incentive stock option is granted. Without limiting the foregoing, the
Administrator may, at any time, or from time to time, authorize the Company,
with the consent of the respective recipients, to issue options in exchange for
the surrender and cancellation of any or all outstanding options.
(c) The Plan shall not confer upon any Optionee or holder of a Stock
Purchase Right any right with respect to continuation of employment by or the
rendition of consulting services to the Company or any Parent, nor shall it
interfere in any way with his or her right or the Company's or, where
applicable, a Parent's right to terminate his or her employment or services at
any time, which right is hereby reserved.
6. Term of Plan. The Plan shall become effective upon the adoption by the
Board of Directors or its approval by vote of the holders of a majority of the
outstanding shares of the Company entitled to vote on the adoption of the Plan
(if obtained by written consent) or of a majority of the Shares present in
person or by proxy at a meeting of the shareholders (if obtained at a meeting),
whichever is earlier. It shall continue in effect for a term of ten (10) years
unless sooner terminated under Section 13 of the Plan.
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<PAGE> 6
7. Exercise Price of and Consideration for Shares.
(a) The per Share exercise price for the Shares to be issued
pursuant to exercise of an Option or Stock Purchase Right shall be such price as
is determined by the Administrator, but in no event shall it be less than 100%
of the Fair Market Value of Common Stock determined as of the date of grant of
the Option. In the case of an Option granted to an Employee or Consultant who,
at the time of grant of such Option, owns stock representing more than ten
percent (10%) of the voting power of all classes of stock of the Company or any
Parent or Subsidiary, the per Share exercise price shall be no less than 110% of
the Fair Market Value of Common Stock determined as of the date of grant of the
Option.
(b) The consideration to be paid for the Shares to be issued upon
exercise of an Option or Stock Purchase Right, including the method of payment,
shall be determined by the Administrator (and, in the case of an Incentive Stock
Option, shall be determined at the time of grant), and may consist entirely of
(i) cash, (ii) check, (iii) promissory note, (iv) other Shares of Stock of the
Company which (x) in the case of Shares required upon exercise of an option
either have been owed by the Optionee for more than six (6) months on the date
of surrender or were not acquired, directly or indirectly, frog she Company, and
(y) have a Fair Market Value on the date of surrender equal to the aggregate
exercise price of the Shares as to which said Option or Stock Purchase Right
shall be exercised, or any combination of such methods of payment, (v) delivery
of a properly executed exercise notice together with irrevocable instructions to
a broker to promptly deliver to the Company the amount of sale or loan proceeds
required to pay the exercise price, or (vi) such other consideration and method
of payment for the issuance of Shares to the extent permitted under applicable
corporate law.
8. Options.
(a) Term of Option. The term of each Option shall be ten (10) years
from the date of grant thereof or such shorter term as may be provided in the
Incentive Stock Option Agreement or the Nonstatutory Stock Option Agreement.
(b) Exercise of Option.
(i) Procedure for Exercise; Rights as a Shareholder.
Any Option granted hereunder shall be exercisable at such times and under such
conditions as determined by the Administrator, including (i) execution of a
restricted stock purchase agreement with the Company in the form approved by the
Administrator and containing such provisions as described in Sections 9(c) and
(d) below, and (ii) performance criteria with respect to the Company and/or the
Optionee, and as shall be permissible under the terms of the Plan; provided,
however, that any Option granted to any person who is subject to Section 16 of
the Exchange Act ("Insider") shall not be exercisable within the first six (6)
months of its term, except that such limitation shall not apply in the event of
the Optionee's death or disability prior to the expiration of the six (6) month
period.
An Option may not be exercised for a fraction of a Share.
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<PAGE> 7
An Option shall be deemed to be exercised when written notice
of such exercise has been given to the Company in accordance with the terms of
the Option by the person entitled to exercise the Option payment for the Shares
with respect to which the Option is exercised has been received by the Company.
Full payment may, as authorized by the Administrator (and, in the case of an
Incentive Stock Option, determined at the time of grant) and permitted by the
Option Agreement, consist of any consideration and method of payment allowable
under Section 7 of the Plan. The Company shall issue a stock certificate
evidencing such shares as soon as practicable. Until the issuance (as evidenced
by the appropriate entry on the books of the Company or of a duly authorized
transfer agent of the Company) of the stock certificate evidencing such Shares,
no right to vote or receive dividends or any other rights as a shareholder shall
exist with respect to the Optioned Stock, notwithstanding the exercise of the
Option. No adjustment will be made for a dividend or other right for which the
record date is prior to the date the stock certificate is issued, except as
provided in Section 11 of the Plan.
Exercise of an Option in any manner shall result in a decrease
in the number of Shares which thereafter may be available, both for purposes of
the Plan and for sale under the Option, by the number of Shares as to which the
Option is exercised.
(ii) Termination of Status as an Employee or Consultant.
Unless otherwise set forth in the Option Agreement, if an Employee or a
Consultant ceases to serve as an Employee or Consultant, as applicable
(including termination by reason of retirement), he or she may, but only within
thirty (30) days after the date he or she ceases to be an Employee or Consultant
of the Company, exercise his or her Option to the extent the Option was
exercisable at the date of such termination. To the extent the Option was not
exercisable at the date of such termination, or if he or she does not exercise
such Option (which he or she was entitled to exercise) within the time specified
herein, the Option shall terminate.
(iii) Disability of Optionee. Notwithstanding the provisions
of Section 8 (b) (ii) above, and unless otherwise set forth in the Option
agreement, in the event an Employee or Consultant is unable to continue his or
her employment with or to perform services for the benefit of the Company as a
result of a disability, he or she may, but only within twelve (12) months from
the date of disability, exercise his or her Option to the extent the Option was
exercisable at the date of such disability. To the extent that the Option was
not exercisable at the date of disability, or if he or she does not exercise
such Option (which he or she was entitled to exercise) within the time specified
herein, the Option shall terminate.
(iv) Death of Optionee. Unless otherwise set forth in the
Option Agreement:
(A) if Optionee dies during the term of the Option and
is at the time of his death an Employee or Consultant of the Company who shall
have been in Continuous Status as an Employee or Consultant since the date of
grant of the Option, then the Option may be exercised, at any time within twelve
(12) months following the date of death (or such other period of time as is
determined by the Board) provided that it is at least six (6) months following
the date of death, by the Optionee's estate or by a person who acquired the
right to exercise the Option by bequest or inheritance, but only to the extent
of the right to exercise that would have accrued had the
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<PAGE> 8
Optionee continued living and remained in Continuous Status as an Employee or
Consultant three (3) months after the date of death (or such other period of
time as is determined by the Board); or
(B) if Optionee dies within thirty (30) days (or such
other period of time not exceeding three (3) months as is determined by the
Board) after the termination of Continuous Status as an Employee, then the
Option may be exercised, at any time within one (1) year following the date of
death (or such other period of time as is determined by the Board), by the
Optionee's estate or by a person who acquired the right to exercise the Option
by bequest or inheritance, but only to the extent of the right to exercise that
had accrued at the date of termination.
9. Stock Purchase Rights.
(a) Rights to Purchase. After the Administrator determines that it
will offer an Employee or Consultant a Stock Purchase Right, it shall advise the
offeree of the terms, conditions and restrictions relating to the offer,
including the number of Shares which such person shall be entitled to purchase,
and the time within which such person must accept such offer, which shall in no
event exceed ninety (90) days from the date upon which the Board or its
Committee made the determination to grant the Stock Purchase Right. The offer
shall be accepted by execution of a Stock Purchase Agreement in the form
determined by the Board of Directors.
(b) Issuance of Shares. Forthwith after payment therefor, the Shares
purchased shall be duly issued; provided, however, that the Administrator may
require that the Purchaser make adequate provision for any federal and state
withholding obligations of the Company as a condition to the Purchaser
purchasing such Shares.
Exercise of a Stock Purchase Right in any manner shall result in a
decrease in the number of Shares which thereafter may be available for purposes
of the Plan by the number of Shares as to which the Stock Purchase Right is
exercised.
(c) Repurchase Option. Unless the Administrator determines
otherwise, the restricted stock purchase agreement shall grant the Company a
repurchase option exercisable upon the voluntary or involuntary termination of
Purchaser's Continuous Status as an Employee with the Company or Parent for any
reason (including death or disability). If the Administrator so determines, the
purchase price for shares repurchased may be paid by cancellation of any
indebtedness of Purchaser to the Company. The repurchase option shall lapse at
such rate as the Administrator may determine, but at a minimum rate of 20% per
year.
(d) Other Provisions. The restricted stock purchase agreement
shall contain such other terms, provisions and conditions not inconsistent
with the Plan as may be determined by the Board.
10. Non-Transferability of Options and Stock Purchase Rights. The Options
and Stock Purchase Rights may not be sold, pledged, assigned, hypothecated,
transferred, or disposed of in any manner other than by will or by the laws of
descent or distribution and may be exercised, during the lifetime of the
Optionee or Purchaser, only by the Optionee or Purchaser.
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<PAGE> 9
11. Adjustments Upon Changes in Capitalization or Merger.
(a) Changes in Capitalization. Subject to any required action by the
shareholders of the Company, the number of Shares covered by each outstanding
Option and Stock Purchase Right, and the number of Shares which have been
authorized for issuance under the Plan but as to which no Options or Stock
Purchase Right have yet been granted or which have been returned to the Plan
upon cancellation or expiration of an Option or Stock Purchase Right, as well as
the price per Share covered by each such outstanding Option or Stock Purchase
Right, shall be proportionately adjusted for any increase or decrease in the
number of issued Shares resulting from a stock split, reverse stock split, stock
dividend, combination or reclassification of the Common Stock, or any other
increase or decrease in the aggregate number of issued Shares effected without
receipt of consideration by the Company; provided, however, that conversion of
any convertible securities of the Company shall not be deemed to have been
"effected without receipt of consideration." Such adjustment shall be made by
the Board, whose determination in that respect shall be final, binding and
conclusive. Except as expressly provided herein, no issuance by the Company of
shares of stock of any class, or securities convertible into shares of stock of
any class, shall affect, and no adjustment by reason thereof shall be made with
respect to, the number or price of Shares subject to an Option or Stock Purchase
Right.
(b) Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, all outstanding Options and Stock
Purchase Rights will terminate immediately prior to the consummation of such
proposed action, unless otherwise provided by the Board.
(c) Merger. In the event of a merger of the Company with or into
another corporation, the Option may be assumed or an equivalent option may be
substituted by such successor corporation or a parent or subsidiary of such
successor corporation. If, in such event, the Option is not assumed or
substituted, the Option shall terminate as of the date of the closing of the
merger. For the purposes of this paragraph, the Option shall be considered
assumed if, following the merger, the option confers the right to purchase, for
each Share of Optioned Stock subject to the Option immediately prior to the
merger, the consideration (whether stock, cash, or other securities or property)
received in the merger by holders of Common Stock for each Share held on the
effective date of the transaction (and if holders were offered a choice of
consideration, the type of consideration chosen by the holders of a majority of
the outstanding Shares); provided, however, that if such consideration received
in the merger was not solely common stock of the successor corporation or its
Parent, the Administrator may, with the consent of the successor corporation,
provide for the consideration to be received upon the exercise of the Option for
each Share of Optioned Stock subject to the Option to be solely common stock of
the successor corporation or its Parent equal in fair market value to the per
share consideration received by holders of Common Stock in the merger.
12. Time of Granting Options and Stock Purchase Rights. The date of grant
of an Option or Stock Purchase Right shall, for all purposes, be the date on
which the Board makes the determination granting such Option or Stock Purchase
Right. Notice of the determination shall be given to each Employee or Consultant
to whom an Option or Stock Purchase Right is so granted within a reasonable time
after the date of such grant.
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<PAGE> 10
13. Amendment and Termination of the Plan.
(a) Amendment and Termination. The Board may at any time amend,
alter, suspend or discontinue the Plan, but no amendment, alteration, suspension
or discontinuation shall be made which would impair the rights of any Optionee
or purchaser under any grant theretofore made, without his or her consent. In
addition, to the extent necessary and desirable to comply with Rule 16b-3 under
the Exchange Act or with Section 422A of the Code (or any other applicable law
or regulation), the Company shall obtain shareholder approval of any Plan
amendment requiring shareholder approval thereunder in such a manner and to such
a degree as is required.
(b) Effect of Amendment or Termination. Any such amendment or
termination of the Plan shall not affect Options or Stock Purchase Rights
already granted and such Options or Stock Purchase Rights shall remain in full
force and effect as if this Plan had not been amended or terminated, unless
mutually agreed otherwise between the Optionee or Purchaser and the
Administrator, which agreement must be in writing and signed by the Optionee or
Purchaser and the Company.
14. Conditions Upon Issuance of Shares. Shares shall not be issued
pursuant to the exercise of an Option or Stock Purchase Right unless the
exercise of such Option or Stock Purchase Right and the issuance and delivery of
Shares pursuant thereto shall comply with all relevant provisions of law,
including, without limitation, the Securities Act of 1933, as amended, the
Exchange Act of 1934 (the "Exchange Act"), the rules and regulations promulgated
thereunder, and the requirements of any stock exchange upon which the Shares may
then be listed, and shall be further subject to the approval of counsel for the
Company with respect to such compliance.
As a condition to the exercise of an Option or Stock Purchase Right,
the Company may require the person exercising such Option or Stock Purchase
Right to represent and warrant at the time of any such exercise that the Shares
are being purchased only for investment and without any present intention to
sell or distribute such Shares if, in the opinion of counsel for the Company,
such a representation is required by any of the aforementioned relevant
provisions of law.
15. Reservation of Shares. The Company, during the term of this Plan, will
at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.
The inability of the Company to obtain authority from any regulatory
body having jurisdiction, which authority is deemed by the Company's counsel to
be necessary to the lawful issuance and sale of any Shares hereunder, shall
relieve the Company of any liability in respect of the failure to issue or sell
such Shares as to which such requisite authority shall not have been obtained.
16. Option and Stock Purchase Agreements. Options shall be evidenced by
written option agreements in such form as the Administrator shall approve. Upon
the exercise of Options or Stock Purchase Rights, the Optionee or Purchaser, as
the case may be, shall sign a restricted stock purchase agreement in such form
as the Board shall approve.
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<PAGE> 11
17. Shareholder Approval. Continuance of the Plan shall be subject to
approval by the shareholders of the Company within twelve (12) months before or
after the date the Plan is adopted. Shareholder approval must be obtained as
described in Section 6.
18. Financial Information. During the period when any Option or Stock
Purchase Right granted under this Plan is outstanding, the Company shall make
available to all holders of outstanding Options or Stock Purchase Rights annual
financial statements prepared in accordance with generally accepted accounting
principles.
**********
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<PAGE> 1
EXHIBIT 4.5
NEW FOCUS, INC.
1998 STOCK PLAN
1. Purposes of the Plan. The purposes of this Stock Plan are to attract
and retain the best available personnel, to provide additional incentive to the
Employees of New Focus, Inc. (the "Company") and to promote the success of the
Company's business.
Options granted hereunder may be either Incentive Stock Options or
Nonstatutory Stock Options, at the discretion of the Board and as reflected in
the terms of the written option agreement. The Board also has the discretion to
grant Stock Purchase Rights.
2. Definitions. As used herein, the following definitions shall apply:
(a) "Administrator" means the Board or any of its Committees
appointed pursuant to Section 4 of the Plan.
(b) "Board" means any Committees if one has been appointed by the
Board in accordance with paragraph (a) of Section 4 of the Plan, or the Board of
Directors of the Company, if no Committee is appointed.
(c) "Code" means the Internal Revenue Code of 1986, as amended.
(d) "Company" means New Focus, Inc., a California corporation.
(e) "Committee" means the Committee appointed by the Board of
Directors in accordance with Section 4(a) of the Plan, if one is appointed.
(f) "Consultant" means any person performing services for the
benefit of the Company or any Parent or Subsidiary as a director, an independent
consultant or advisor; provided that if and in the event the Company registers
any class of any equity security pursuant to Section 12 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), the term Consultant shall
thereafter not include directors who are not compensated for their services or
are paid only a director's fee by the Company.
(g) "Continuous Status as an Employee or Consultant" means the
absence of any interruption or termination of the employment or consulting
relationship, as applicable. Continuous Status as an Employee or Consultant
shall not be considered interrupted in the case of: (i) sick leave; (ii)
military leave; (iii) any other for a period of not more than 90 days or
reemployment upon the expiration of such leave is guaranteed by contract or
statute or unless otherwise provided pursuant to formal policy adopted from time
to time by the Company and issued and promulgated to Employees in writing; or
(iv) in the case of transfers between locations of the Company or between the
Company, its Parent or its Subsidiaries.
<PAGE> 2
(h) "Employee" means any person, including officers and directors,
employed by the Company or any Parent or Subsidiary of the Company. The payment
of a director's fee by the Company shall not be sufficient to constitute
"employment", by the Company.
(i) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
(j) "Fair Market Value" means the value of Common Stock determined
as follows:
(i) The Common Stock is listed on any established stock exchange
or a national market system, included without limitation, the National Market
System of the National Association of Securities Dealers, Inc. Automated
Quotation ("NASDAQ") System, its Fair Market Value shall be the closing sales
price for such stock where the closing bid, if no sales were reported, as quoted
on such system or exchange (or the exchange with the greatest volume of trading
in common stock) for the last trading day prior to the time of determination, as
reported in the Wall Street Journal or such other source as the Administrator
deems reliable.
(ii) If the Common Stock is quoted on the NASDAQ System (but not
on the National Market System thereof) or regularly quoted by a recognized
securities dealer but selling prices are not reported, its Fair Market Value
shall be the mean between the high and low asked prices for the Common Stock for
the last day on which there are quoted prices prior to the time of
determination, or;
(iii) In the absence of an established market for the Common
Stock, the Fair Market Value shall be determined in good faith by the
Administrator.
(k) "Incentive Stock Option" means an Option intended to qualify as
an incentive stock option within the meaning of Section 422A of the Code.
(l) "Nonstatutory Stock Option" means an Option not intended to
qualify as an Incentive Stock Option.
(m) "Option" means a stock option granted pursuant to the Plan.
(n) "Optioned Stock" means the Stock subject to an Option.
(o) "Optionee" means an Employee or Consultant who receives an
Option.
(p) "Parent" means a "parent corporation," whether now or hereafter
existing, as defined in Section 425(e) of the Code.
(q) "Plan" means this 1998 Stock Plan.
(r) "Purchaser" means an Employee or Consultant who exercises a
Stock Purchase Right.
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<PAGE> 3
(s) "Share" means a share of the Stock, as adjusted in accordance
with Section II of the Plan.
(t) "Stock" means the Common Stock of the Company.
(u) "Stock Purchase Right" means a right to purchase Stock pursuant
to the Plan or the right to receive a bonus of stock for past services rendered.
(v) "Subsidiary" means a "subsidiary corporation," whether now or
hereafter existing, as defined in Section 425(f) of the Code.
In addition, the term "Rule 16b-3" and the term "Insiders" shall have
the meaning set forth, respectively, in Sections 4 and 8 below.
3. Stock Subject to the Plan. Subject to the provisions of Section II of
the Plan, the maximum aggregate number of shares under the Plan is TWO HUNDRED
THOUSAND (200,000) shares of Stock. The Shares may be authorized, but unissued,
or reacquired Stock.
If an Option or Stock Purchase Right should expire or become
unexercisable for any reason without having been exercised in full, the
unpurchased Shares which were subject thereto shall, unless the Plan shall have
been terminated, become available for future grant or sale under the Plan.
Shares issued under the Plan and later repurchased by the Company in connection
with the Company's right to repurchase unvested shares shall become available
for future grant or sale under the Plan.
4. Administration of the Plan. The Plan shall be administered by the
Board.
(a) Administration Prior to Registration. Subject to subsection (b),
the Board may appoint a Committee consisting of not less than two members of the
Board, to administer the Plan on behalf of the Board, subject to such terms and
conditions as the Board may prescribe. Once appointed, the Committee shall
continue to serve until otherwise directed by the Board. Members of the Board
who are either eligible for Options or Stock Purchase Rights or who have been
granted Options or Stock Purchase Rights may vote on any matters affecting the
administration of the Plan or the grant of any Options or Stock Purchase Rights
pursuant to the Plan, except that no such member shall act upon the granting of
an Option or Stock Purchase Right to himself or herself, but any such member may
be counted in determining the existence of a quorum at any meeting of the Board
or Committee during which action is taken with respect to the granting of
Options or Stock Purchase Rights to said Board or Committee member.
(b) Administration After Registration. Notwithstanding the foregoing
subparagraph (i), if and in any event the Company registers any class of any
equity security pursuant to Section 12 of the Exchange Act, from the effective
date of such registration until six months after the termination of such
registration, the Plan shall be administered as follows:
(i) Administration With Respect to Directors and Officers. With
respect to grants of Options or Stock Purchase Rights to Employees who are also
officers and directors of the Company, the Plan shall be administered by (A) the
Board, if the Board may administer the Plan
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<PAGE> 4
in compliance with Rule 16b-3 promulgated under the Exchange Act, or any
successor rule thereto ("Rule 16b-3"), with respect to a plan intended to
qualify under Rule 16b-3 as a discretionary plan, or (B) a Committee designated
by the Board to administer the Plan, which Committee shall be constituted in
such a manner as to permit the Plan to comply with Rule 16b-3 with respect to a
plan intended to qualify thereunder as a discretionary plan. Once appointed,
such Committee shall continue to serve in its designated capacity until
otherwise directed by the Board. From time to time the Board may increase the
size of the Committee and appoint additional members thereof, remove members
(with or without cause) and appoint new members in substitution therefor, fill
vacancies, however caused, and remove all members of the Committee and
thereafter directly administer the Plan, all to the extent permitted by Rule
16b-3 with respect to a plan intended to qualify thereunder as a discretionary
plan.
(ii) Multiple Administrative Bodies. If permitted by Rule 16b-3,
the Plan may be administered by different bodies with respect to directors,
non-director officers and Employees who are neither directors nor officers.
(iii) Administration With Respect to Other Employees. With
respect to grants of Options or Stock Purchase Rights to Employees who are
neither directors nor officers of the Company, the Plan shall be administered by
(A) the Board or (B) a Committee designated by the Board, which Committee shall
be constituted in such a manner as to satisfy the legal requirements relating to
the administration of incentive stock option plans, if any, of California
corporate and securities laws and of the Code (the "Applicable Laws"). Once
appointed, such Committee shall continue to serve in its designated capacity
until otherwise directed by the Board. From time to time The Board may increase
the size of the Committee and appoint additional members thereof, remove members
(with or without cause) and appoint new members in substitution therefor, fill
vacancies, however caused, and remove all members of the Committee and
thereafter directly administer the Plan, all to the extent permitted by the
Applicable Laws.
(c) Powers of the Board. Subject to the provisions of the Plan and,
in the case of a Committee, the specific duties delegated by the Board to such
Committee, the Administrator shall have the authority, in its discretion: (i) to
grant Incentive Stock Options, Nonstatutory Stock Options or Stock Purchase
Rights; (ii) to determine, in accordance with Section 1(j) of the Plan, the Fair
Market Value of the Stock; (iii) to determine the exercise price per Share of
Options, or Stock Purchase Rights, to be granted, which exercise pro shall be
determined in accordance with Section 7 of the Plan; (iv) to determine the
Employees and Consultants to whom, and the time or times at which, Options or
Stock Purchase Rights shall be granted and the number of Shares to be
represented by each Option or Stock Purchase Right; (v) to interpret the Plan;
(vi) to prescribe, amend and rescind rules and regulations relating to the Plan;
(vii) to determine the terms and provisions of each Option or Stock Purchase
Right granted (which need not be identical) and, with the consent of the holder
thereof, modify or amend each Option or Stock Purchase Right; (viii) to
accelerate or defer (with the consent of the Optionee) the exercise date of any
Option, consistent with the provisions of Section 5 of the Plan; (ix) to reduce
the exercise price of any Option to the then current Fair Market Value if the
Fair Market Value of the Common Stock covered by such Option shall have declined
since the date the Option was granted; (x) to authorize any person to execute on
behalf of the Company any instrument required to effectuate the grant of an
Option or
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<PAGE> 5
Stock Purchase Right previously granted by the Administrator; and (xi) to make
all other determinations deemed necessary or advisable for the administration of
the Plan.
(d) Effect of Decisions by the Administrator. All decisions,
determinations and interpretations of the Administrator shall be final and
binding on all Optionees, Purchasers and any other holders of any Options or
Stock Purchase Rights granted under the Plan.
5. Eligibility.
(a) Options and Stock Purchase Rights may be granted to Employees
and Consultants, provided that Incentive Stock options may only be granted to
Employees. An Employee or Consultant who has been granted an Option or Stock
Purchase Right may, if he is otherwise eligible, be granted additional option(s)
or Stock Purchase Right(s).
(b) Each Option or Stock Purchase Right shall be evidenced by a
written agreement, which, in the case of an Option, shall expressly identify the
Option as an incentive stock option or as a nonstatutory stock option, and which
shall be in such form and contain such provisions as the Administrator shall
from time to time deem appropriate. However, notwithstanding such designation,
to the extent that the aggregate Fair Market Value of (i) the Shares with
respect to which Options designated as incentive stock options plus (ii) the
shares of stock of the Company, Parent and any Subsidiary with respect to which
other incentive stock options are exercisable for the first time by an Optionee
during any calendar year under all plans of the Company and any Parent and
Subsidiary exceed $100,000, such excess options shall be treated as nonstatutory
stock options. For purposes of the preceding sentence, (i) Options shall be
taken into account in the order in which they were granted, and (ii) the Fair
Market Value of the Shares shall be determined as of the time the Option or
other incentive stock option is granted. Without limiting the foregoing, the
Administrator may, at any time, or from time to time, authorize the Company,
with the consent of the respective recipients, to issue options in exchange for
the surrender and cancellation of any or all outstanding options.
(c) The Plan shall not confer upon any Optionee or holder of a Stock
Purchase Right any right with respect to continuation of employment by or the
rendition of consulting services to the Company or any Parent, nor shall it
interfere in any way with his or her right or the Company's or, where
applicable, a Parent's right to terminate his or her employment or services at
any time, which right is hereby reserved.
6. Term of Plan. The Plan shall become effective upon the adoption by
the Board of Directors or its approval by vote of the holders of a majority of
the outstanding shares of the Company entitled to vote on the adoption of the
Plan (if obtained by written consent) or of a majority of the Shares present in
person or by proxy at a meeting of the shareholders (if obtained at a meeting),
whichever is earlier. It shall continue in effect for a term of ten (10) years
unless sooner terminated under Section 13 of the Plan.
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<PAGE> 6
7. Exercise Price of and Consideration for Shares.
(a) The per Share exercise price for the Shares to be issued
pursuant to exercise of an Option or Stock Purchase Right shall be such price as
is determined by the Administrator, but in no event shall it be less than 100%
of the Fair Market Value of Common Stock determined as of the date of grant of
the Option. In the case of an Option granted to an Employee or Consultant who,
at the time of grant of such Option, owns stock representing more than ten
percent (10%) of the voting power of all classes of stock of the Company or any
Parent or Subsidiary, the per Share exercise price shall be no less than 110% of
the Fair Market Value of Common Stock determined as of the date of grant of the
Option.
(b) The consideration to be paid for the Shares to be issued upon
exercise of an Option or Stock Purchase Right, including the method of payment,
shall be determined by the Administrator (and, in the case of an Incentive Stock
Option, shall be determined at the time of grant), and may consist entirely of
(i) cash, (ii) check, (iii) promissory note, (iv) other Shares of Stock of the
Company which (x) in the case of Shares required upon exercise of an option
either have been owed by the Optionee for more than six (6) months on the date
of surrender or were not acquired, directly or indirectly, frog she Company, and
(y) have a Fair Market Value on the date of surrender equal to the aggregate
exercise price of the Shares as to which said Option or Stock Purchase Right
shall be exercised, or any combination of such methods of payment, (v) delivery
of a properly executed exercise notice together with irrevocable instructions to
a broker to promptly deliver to the Company the amount of sale or loan proceeds
required to pay the exercise price, or (vi) such other consideration and method
of payment for the issuance of Shares to the extent permitted under applicable
corporate law.
8. Options.
(a) Term of Option. The term of each Option shall be ten (10) years
from the date of grant thereof or such shorter term as may be provided in the
Incentive Stock Option Agreement or the Nonstatutory Stock Option Agreement.
(b) Exercise of Option.
(i) Procedure for Exercise; Rights as a Shareholder. Any Option
granted hereunder shall be exercisable at such times and under such conditions
as determined by the Administrator, including (i) execution of a restricted
stock purchase agreement with the Company in the form approved by the
Administrator and containing such provisions as described in Sections 9(c) and
(d) below, and (ii) performance criteria with respect to the Company and/or the
Optionee, and as shall be permissible under the terms of the Plan; provided,
however, that any Option granted to any person who is subject to Section 16 of
the Exchange Act ("Insider") shall not be exercisable within the first six (6)
months of its term, except that such limitation shall not apply in the event of
the Optionee's death or disability prior to the expiration of the six (6) month
period.
An Option may not be exercised for a fraction of a Share.
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<PAGE> 7
An Option shall be deemed to be exercised when written notice of
such exercise has been given to the Company in accordance with the terms of the
Option by the person entitled to exercise the Option payment for the Shares with
respect to which the Option is exercised has been received by the Company. Full
payment may, as authorized by the Administrator (and, in the case of an
Incentive Stock Option, determined at the time of grant) and permitted by the
Option Agreement, consist of any consideration and method of payment allowable
under Section 7 of the Plan. The Company shall issue a stock certificate
evidencing such shares as soon as practicable. Until the issuance (as evidenced
by the appropriate entry on the books of the Company or of a duly authorized
transfer agent of the Company) of the stock certificate evidencing such Shares,
no right to vote or receive dividends or any other rights as a shareholder shall
exist with respect to the Optioned Stock, notwithstanding the exercise of the
Option. No adjustment will be made for a dividend or other right for which the
record date is prior to the date the stock certificate is issued, except as
provided in Section 11 of the Plan.
Exercise of an Option in any manner shall result in a decrease
in the number of Shares which thereafter may be available, both for purposes of
the Plan and for sale under the Option, by the number of Shares as to which the
Option is exercised.
(ii) Termination of Status as an Employee or Consultant. Unless
otherwise set forth in the Option Agreement, if an Employee or a Consultant
ceases to serve as an Employee or Consultant, as applicable (including
termination by reason of retirement), he or she may, but only within thirty (30)
days after the date he or she ceases to be an Employee or Consultant of the
Company, exercise his or her Option to the extent the Option was exercisable at
the date of such termination. To the extent the Option was not exercisable at
the date of such termination, or if he or she does not exercise such Option
(which he or she was entitled to exercise) within the time specified herein, the
Option shall terminate.
(iii) Disability of Optionee. Notwithstanding the provisions of
Section 8 (b) (ii) above, and unless otherwise set forth in the Option
agreement, in the event an Employee or Consultant is unable to continue his or
her employment with or to perform services for the benefit of the Company as a
result of a disability, he or she may, but only within twelve (12) months from
the date of disability, exercise his or her Option to the extent the Option was
exercisable at the date of such disability. To the extent that the Option was
not exercisable at the date of disability, or if he or she does not exercise
such Option (which he or she was entitled to exercise) within the time specified
herein, the Option shall terminate.
(iv) Death of Optionee. Unless otherwise set forth in the Option
Agreement:
(A) if Optionee dies during the term of the Option and is at
the time of his death an Employee or Consultant of the Company who shall have
been in Continuous Status as an Employee or Consultant since the date of grant
of the Option, then the Option may be exercised, at any time within twelve (12)
months following the date of death (or such other period of time as is
determined by the Board) provided that it is at least six (6) months following
the date of death, by the Optionee's estate or by a person who acquired the
right to exercise the Option by bequest or inheritance, but only to the extent
of the right to exercise that would have accrued had the
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<PAGE> 8
Optionee continued living and remained in Continuous Status as an Employee or
Consultant three (3) months after the date of death (or such other period of
time as is determined by the Board); or
(B) if Optionee dies within thirty (30) days (or such other
period of time not exceeding three (3) months as is determined by the Board)
after the termination of Continuous Status as an Employee, then the Option may
be exercised, at any time within one (1) year following the date of death (or
such other period of time as is determined by the Board), by the Optionee's
estate or by a person who acquired the right to exercise the Option by bequest
or inheritance, but only to the extent of the right to exercise that had accrued
at the date of termination.
9. Stock Purchase Rights.
(a) Rights to Purchase. After the Administrator determines that it
will offer an Employee or Consultant a Stock Purchase Right, it shall advise the
offeree of the terms, conditions and restrictions relating to the offer,
including the number of Shares which such person shall be entitled to purchase,
and the time within which such person must accept such offer, which shall in no
event exceed ninety (90) days from the date upon which the Board or its
Committee made the determination to grant the Stock Purchase Right. The offer
shall be accepted by execution of a Stock Purchase Agreement in the form
determined by the Board of Directors.
(b) Issuance of Shares. Forthwith after payment therefor, the Shares
purchased shall be duly issued; provided, however, that the Administrator may
require that the Purchaser make adequate provision for any federal and state
withholding obligations of the Company as a condition to the Purchaser
purchasing such Shares.
Exercise of a Stock Purchase Right in any manner shall result in a
decrease in the number of Shares which thereafter may be available for purposes
of the Plan by the number of Shares as to which the Stock Purchase Right is
exercised.
(c) Repurchase Option. Unless the Administrator determines
otherwise, the restricted stock purchase agreement shall grant the Company a
repurchase option exercisable upon the voluntary or involuntary termination of
Purchaser's Continuous Status as an Employee with the Company or Parent for any
reason (including death or disability). If the Administrator so determines, the
purchase price for shares repurchased may be paid by cancellation of any
indebtedness of Purchaser to the Company. The repurchase option shall lapse at
such rate as the Administrator may determine, but at a minimum rate of 20% per
year.
(d) Other Provisions. The restricted stock purchase agreement shall
contain such other terms, provisions and conditions not inconsistent with the
Plan as may be determined by the Board.
10. Non-Transferability of Options and Stock Purchase Rights. The
Options and Stock Purchase Rights may not be sold, pledged, assigned,
hypothecated, transferred, or disposed of in any manner other than by will or by
the laws of descent or distribution and may be exercised, during the lifetime of
the Optionee or Purchaser, only by the Optionee or Purchaser.
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<PAGE> 9
11. Adjustments Upon Changes in Capitalization or Merger.
(a) Changes in Capitalization. Subject to any required action by the
shareholders of the Company, the number of Shares covered by each outstanding
Option and Stock Purchase Right, and the number of Shares which have been
authorized for issuance under the Plan but as to which no Options or Stock
Purchase Right have yet been granted or which have been returned to the Plan
upon cancellation or expiration of an Option or Stock Purchase Right, as well as
the price per Share covered by each such outstanding Option or Stock Purchase
Right, shall be proportionately adjusted for any increase or decrease in the
number of issued Shares resulting from a stock split, reverse stock split, stock
dividend, combination or reclassification of the Common Stock, or any other
increase or decrease in the aggregate number of issued Shares effected without
receipt of consideration by the Company; provided, however, that conversion of
any convertible securities of the Company shall not be deemed to have been
"effected without receipt of consideration." Such adjustment shall be made by
the Board, whose determination in that respect shall be final, binding and
conclusive. Except as expressly provided herein, no issuance by the Company of
shares of stock of any class, or securities convertible into shares of stock of
any class, shall affect, and no adjustment by reason thereof shall be made with
respect to, the number or price of Shares subject to an Option or Stock Purchase
Right.
(b) Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, all outstanding Options and Stock
Purchase Rights will terminate immediately prior to the consummation of such
proposed action, unless otherwise provided by the Board.
(c) Merger. In the event of a merger of the Company with or into
another corporation, the Option may be assumed or an equivalent option may be
substituted by such successor corporation or a parent or subsidiary of such
successor corporation. If, in such event, the Option is not assumed or
substituted, the Option shall terminate as of the date of the closing of the
merger. For the purposes of this paragraph, the Option shall be considered
assumed if, following the merger, the option confers the right to purchase, for
each Share of Optioned Stock subject to the Option immediately prior to the
merger, the consideration (whether stock, cash, or other securities or property)
received in the merger by holders of Common Stock for each Share held on the
effective date of the transaction (and if holders were offered a choice of
consideration, the type of consideration chosen by the holders of a majority of
the outstanding Shares); provided, however, that if such consideration received
in the merger was not solely common stock of the successor corporation or its
Parent, the Administrator may, with the consent of the successor corporation,
provide for the consideration to be received upon the exercise of the Option for
each Share of Optioned Stock subject to the Option to be solely common stock of
the successor corporation or its Parent equal in fair market value to the per
share consideration received by holders of Common Stock in the merger.
12. Time of Granting Options and Stock Purchase Rights. The date of
grant of an Option or Stock Purchase Right shall, for all purposes, be the date
on which the Board makes the determination granting such Option or Stock
Purchase Right. Notice of the determination shall be given to each Employee or
Consultant to whom an Option or Stock Purchase Right is so granted within a
reasonable time after the date of such grant.
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<PAGE> 10
13. Amendment and Termination of the Plan.
(a) Amendment and Termination. The Board may at any time amend,
alter, suspend or discontinue the Plan, but no amendment, alteration, suspension
or discontinuation shall be made which would impair the rights of any Optionee
or purchaser under any grant theretofore made, without his or her consent. In
addition, to the extent necessary and desirable to comply with Rule 16b-3 under
the Exchange Act or with Section 422A of the Code (or any other applicable law
or regulation), the Company shall obtain shareholder approval of any Plan
amendment requiring shareholder approval thereunder in such a manner and to such
a degree as is required.
(b) Effect of Amendment or Termination. Any such amendment or
termination of the Plan shall not affect Options or Stock Purchase Rights
already granted and such Options or Stock Purchase Rights shall remain in full
force and effect as if this Plan had not been amended or terminated, unless
mutually agreed otherwise between the Optionee or Purchaser and the
Administrator, which agreement must be in writing and signed by the Optionee or
Purchaser and the Company.
14. Conditions Upon Issuance of Shares. Shares shall not be issued
pursuant to the exercise of an Option or Stock Purchase Right unless the
exercise of such Option or Stock Purchase Right and the issuance and delivery of
Shares pursuant thereto shall comply with all relevant provisions of law,
including, without limitation, the Securities Act of 1933, as amended, the
Exchange Act of 1934 (the "Exchange Act"), the rules and regulations promulgated
thereunder, and the requirements of any stock exchange upon which the Shares may
then be listed, and shall be further subject to the approval of counsel for the
Company with respect to such compliance.
As a condition to the exercise of an Option or Stock Purchase Right,
the Company may require the person exercising such Option or Stock Purchase
Right to represent and warrant at the time of any such exercise that the Shares
are being purchased only for investment and without any present intention to
sell or distribute such Shares if, in the opinion of counsel for the Company,
such a representation is required by any of the aforementioned relevant
provisions of law.
15. Reservation of Shares. The Company, during the term of this Plan,
will at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.
The inability of the Company to obtain authority from any regulatory
body having jurisdiction, which authority is deemed by the Company's counsel to
be necessary to the lawful issuance and sale of any Shares hereunder, shall
relieve the Company of any liability in respect of the failure to issue or sell
such Shares as to which such requisite authority shall not have been obtained.
16. Option and Stock Purchase Agreements. Options shall be evidenced by
written option agreements in such form as the Administrator shall approve. Upon
the exercise of Options or Stock Purchase Rights, the Optionee or Purchaser, as
the case may be, shall sign a restricted stock purchase agreement in such form
as the Board shall approve.
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<PAGE> 11
17. Shareholder Approval. Continuance of the Plan shall be subject to
approval by the shareholders of the Company within twelve (12) months before or
after the date the Plan is adopted. Shareholder approval must be obtained as
described in Section 6.
18. Financial Information. During the period when any Option or Stock
Purchase Right granted under this Plan is outstanding, the Company shall make
available to all holders of outstanding Options or Stock Purchase Rights annual
financial statements prepared in accordance with generally accepted accounting
principles.
**********
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<PAGE> 1
EXHIBIT 4.6
NEW FOCUS, INC.
1999 STOCK PLAN
ADOPTED DECEMBER 8, 1999
1. Purposes of the Plan. The purposes of this Stock Plan are to attract
and retain the best available personnel for positions of substantial
responsibility, to provide additional incentive to Employees, Directors and
Consultants and to promote the success of the Company's business. Options
granted under the Plan may be Incentive Stock Options or Nonstatutory Stock
Options, as determined by the Administrator at the time of grant. Stock Purchase
Rights may also be granted under the Plan.
2. Definitions. As used herein, the following definitions shall apply:
(a) "Administrator" means the Board or any of its Committees as
shall be administering the Plan in accordance with Section 4 hereof.
(b) "Applicable Laws" means the requirements relating to the
administration of stock option plans under U.S. state corporate laws, U.S.
federal and state securities laws, the Code, any stock exchange or quotation
system on which the Stock is listed or quoted and the applicable laws of any
other country or jurisdiction where Options or Stock Purchase Rights are granted
under the Plan.
(c) "Board" means the Board of Directors of the Company.
(d) "Code" means the Internal Revenue Code of 1986, as amended.
(e) "Committee" means a committee of Directors appointed by the
Board in accordance with Section 4 hereof.
(f) "Common Stock" means the Common Stock of the Company.
(g) "Company" means New Focus, Inc., a California corporation.
(h) "Consultant" means any person who is engaged by the Company
or any Parent or Subsidiary to render consulting or advisory services to such
entity.
(i) "Director" means a member of the Board.
(j) "Disability" means total and permanent disability as defined
in Section 22(e)(3) of the Code.
(k) "Employee" means any person, including Officers and
Directors, employed by the Company or any Parent or Subsidiary of the Company. A
Service Provider shall not cease to be an Employee in the case of (i) any leave
of absence approved by the Company or (ii) transfers
<PAGE> 2
between locations of the Company or between the Company, its Parent, any
Subsidiary, or any successor. For purposes of Incentive Stock Options, no such
leave may exceed ninety days, unless reemployment upon expiration of such leave
is guaranteed by statute or contract. If reemployment upon expiration of a leave
of absence approved by the Company is not so guaranteed, on the 181st day of
such leave any Incentive Stock Option held by the Optionee shall cease to be
treated as an Incentive Stock Option and shall be treated for tax purposes as a
Nonstatutory Stock Option. Neither service as a Director nor payment of a
director's fee by the Company shall be sufficient to constitute "employment" by
the Company.
(l) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
(m) "Fair Market Value" means, as of any date, the value of
Common Stock determined as follows:
(i) If the Common Stock is listed on any established
stock exchange or a national market system, including without limitation the
Nasdaq National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market,
its Fair Market Value shall be the closing sales price for such stock (or the
closing bid, if no sales were reported) as quoted on such exchange or system for
the last market trading day prior to the time of determination, as reported in
The Wall Street Journal or such other source as the Administrator deems
reliable;
(ii) If the Common Stock is regularly quoted by a
recognized securities dealer but selling prices are not reported, its Fair
Market Value shall be the mean between the high bid and low asked prices for the
Common Stock on the last market trading day prior to the day of determination;
or
(iii) In the absence of an established market for the
Common Stock, the Fair Market Value thereof shall be determined in good faith by
the Administrator.
(n) "Incentive Stock Option" means an Option intended to qualify
as an incentive stock option within the meaning of Section 422 of the Code.
(o) "Nonstatutory Stock Option" means an Option not intended to
qualify as an Incentive Stock Option.
(p) "Officer" means a person who is an officer of the Company
within the meaning of Section 16 of the Exchange Act and the rules and
regulations promulgated thereunder.
(q) "Option" means a stock option granted pursuant to the Plan.
(r) "Option Agreement" means a written or electronic agreement
between the Company and an Optionee evidencing the terms and conditions of an
individual Option grant. The Option Agreement is subject to the terms and
conditions of the Plan.
(s) "Option Exchange Program" means a program whereby outstanding
Options are exchanged for Options with a lower exercise price.
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<PAGE> 3
(t) "Optioned Stock" means the Common Stock subject to an Option
or a Stock Purchase Right.
(u) "Optionee" means the holder of an outstanding Option or Stock
Purchase Right granted under the Plan.
(v) "Parent" means a "parent corporation," whether now or
hereafter existing, as defined in Section 424(e) of the Code.
(w) "Plan" means this 1999 Stock Plan.
(x) "Restricted Stock" means shares of Common Stock acquired
pursuant to a grant of a Stock Purchase Right under Section 11 below.
(y) "Service Provider" means an Employee, Director or Consultant.
(z) "Share" means a share of the Common Stock, as adjusted in
accordance with Section 12 below.
(aa) "Stock Purchase Right" means a right to purchase Common
Stock pursuant to Section 11 below.
(bb) "Subsidiary" means a "subsidiary corporation," whether now
or hereafter existing, as defined in Section 424(f) of the Code.
3. Stock Subject to the Plan. Subject to the provisions of Section 12 of
the Plan, the maximum aggregate number of Shares that may be subject to option
and sold under the Plan is 2,700,000 Shares. The Shares may be authorized but
unissued, or reacquired Common Stock.
If an Option or Stock Purchase Right expires or becomes
unexercisable without having been exercised in full, or is surrendered pursuant
to an Option Exchange Program, the unpurchased Shares which were subject thereto
shall become available for future grant or sale under the Plan (unless the Plan
has terminated). However, Shares that have actually been issued under the Plan,
upon exercise of either an Option or Stock Purchase Right, shall not be returned
to the Plan and shall not become available for future distribution under the
Plan, except that if Shares of Restricted Stock are repurchased by the Company
at their original purchase price, such Shares shall become available for future
grant under the Plan.
4. Administration of the Plan.
(a) Administrator. The Plan shall be administered by the Board or
a Committee appointed by the Board, which Committee shall be constituted to
comply with Applicable Laws.
(b) Powers of the Administrator. Subject to the provisions of the
Plan and, in the case of a Committee, the specific duties delegated by the Board
to such Committee, and subject to the approval of any relevant authorities, the
Administrator shall have the authority in its discretion:
(i) to determine the Fair Market Value;
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<PAGE> 4
(ii) to select the Service Providers to whom Options and
Stock Purchase Rights may from time to time be granted hereunder;
(iii) to determine the number of Shares to be covered by
each such award granted hereunder;
(iv) to approve forms of agreement for use under the Plan;
(v) to determine the terms and conditions, of any Option
or Stock Purchase Right granted hereunder. Such terms and conditions include,
but are not limited to, the exercise price, the time or times when Options or
Stock Purchase Rights may be exercised (which may be based on performance
criteria), any vesting acceleration or waiver of forfeiture restrictions, and
any restriction or limitation regarding any Option or Stock Purchase Right or
the Common Stock relating thereto, based in each case on such factors as the
Administrator, in its sole discretion, shall determine;
(vi) to determine whether and under what circumstances an
Option may be settled in cash under subsection 9(e) instead of Common Stock;
(vii) to reduce the exercise price of any Option to the
then current Fair Market Value if the Fair Market Value of the Common Stock
covered by such Option has declined since the date the Option was granted;
(viii) to initiate an Option Exchange Program;
(ix) to prescribe, amend and rescind rules and regulations
relating to the Plan, including rules and regulations relating to sub-plans
established for the purpose of qualifying for preferred tax treatment under
foreign tax laws;
(x) to allow Optionees to satisfy withholding tax
obligations by electing to have the Company withhold from the Shares to be
issued upon exercise of an Option or Stock Purchase Right that number of Shares
having a Fair Market Value equal to the amount required to be withheld. The Fair
Market Value of the Shares to be withheld shall be determined on the date that
the amount of tax to be withheld is to be determined. All elections by Optionees
to have Shares withheld for this purpose shall be made in such form and under
such conditions as the Administrator may deem necessary or advisable; and
(xi) to construe and interpret the terms of the Plan and
awards granted pursuant to the Plan.
(c) Effect of Administrator's Decision. All decisions,
determinations and interpretations of the Administrator shall be final and
binding on all Optionees.
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<PAGE> 5
5. Eligibility.
(a) Nonstatutory Stock Options and Stock Purchase Rights may
be granted to Service Providers. Incentive Stock Options may be granted
only to Employees.
(b) Each Option shall be designated in the Option Agreement as
either an Incentive Stock Option or a Nonstatutory Stock Option. However,
notwithstanding such designation, to the extent that the aggregate Fair Market
Value of the Shares with respect to which Incentive Stock Options are
exercisable for the first time by the Optionee during any calendar year (under
all plans of the Company and any Parent or Subsidiary) exceeds $100,000, such
Options shall be treated as Nonstatutory Stock Options. For purposes of this
Section 5(b), Incentive Stock Options shall be taken into account in the order
in which they were granted. The Fair Market Value of the Shares shall be
determined as of the time the Option with respect to such Shares is granted.
(c) Neither the Plan nor any Option or Stock Purchase Right shall
confer upon any Optionee any right with respect to continuing the Optionee's
relationship as a Service Provider with the Company, nor shall it interfere in
any way with his or her right or the Company's right to terminate such
relationship at any time, with or without cause.
6. Term of Plan. The Plan shall become effective upon its adoption by
the Board. It shall continue in effect for a term of ten (10) years unless
sooner terminated under Section 14 of the Plan.
7. Term of Option. The term of each Option shall be stated in the Option
Agreement; provided, however, that the term shall be no more than ten (10) years
from the date of grant thereof. In the case of an Incentive Stock Option granted
to an Optionee who, at the time the Option is granted, owns stock representing
more than ten percent (10%) of the voting power of all classes of stock of the
Company or any Parent or Subsidiary, the term of the Option shall be five (5)
years from the date of grant or such shorter term as may be provided in the
Option Agreement.
8. Option Exercise Price and Consideration.
(a) The per share exercise price for the Shares to be issued upon
exercise of an Option shall be such price as is determined by the Administrator,
but shall be subject to the following:
(i) In the case of an Incentive Stock Option
(A) granted to an Employee who, at the time of
grant of such Option, owns stock representing more than ten percent (10%) of the
voting power of all classes of stock of the Company or any Parent or Subsidiary,
the exercise price shall be no less than 110% of the Fair Market Value per Share
on the date of grant.
(B) granted to any other Employee, the per Share
exercise price shall be no less than 100% of the Fair Market Value per Share on
the date of grant.
(ii) In the case of a Nonstatutory Stock Option
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<PAGE> 6
(A) granted to a Service Provider who, at the time
of grant of such Option, owns stock representing more than ten percent (10%) of
the voting power of all classes of stock of the Company or any Parent or
Subsidiary, the exercise price shall be no less than 110% of the Fair Market
Value per Share on the date of grant.
(B) granted to any other Service Provider, the per
Share exercise price shall be no less than 85% of the Fair Market Value per
Share on the date of grant.
(iii) Notwithstanding the foregoing, Options may be
granted with a per Share exercise price other than as required above pursuant to
a merger or other corporate transaction.
(b) The consideration to be paid for the Shares to be issued upon
exercise of an Option, including the method of payment, shall be determined by
the Administrator (and, in the case of an Incentive Stock Option, shall be
determined at the time of grant). Such consideration may consist of (1) cash,
(2) check, (3) promissory note, (4) other Shares which (x) in the case of Shares
acquired upon exercise of an Option, have been owned by the Optionee for more
than six months on the date of surrender, and (y) have a Fair Market Value on
the date of surrender equal to the aggregate exercise price of the Shares as to
which such Option shall be exercised, (5) consideration received by the Company
under a cashless exercise program implemented by the Company in connection with
the Plan, or (6) any combination of the foregoing methods of payment. In making
its determination as to the type of consideration to accept, the Administrator
shall consider if acceptance of such consideration may be reasonably expected to
benefit the Company.
9. Exercise of Option.
(a) Procedure for Exercise; Rights as a Shareholder. Any Option
granted hereunder shall be exercisable according to the terms hereof at such
times and under such conditions as determined by the Administrator and set forth
in the Option Agreement. Except in the case of Options granted to Officers,
Directors and Consultants, Options shall become exercisable at a rate of no less
than 20% per year over five (5) years from the date the Options are granted.
Unless the Administrator provides otherwise, vesting of Options granted
hereunder to Officers and Directors shall be tolled during any unpaid leave of
absence. An Option may not be exercised for a fraction of a Share.
An Option shall be deemed exercised when the Company
receives (i) written or electronic notice of exercise (in accordance with the
Option Agreement) from the person entitled to exercise the Option, and (ii) full
payment for the Shares with respect to which the Option is exercised. Full
payment may consist of any consideration and method of payment authorized by the
Administrator and permitted by the Option Agreement and the Plan. Shares issued
upon exercise of an Option shall be issued in the name of the Optionee or, if
requested by the Optionee, in the name of the Optionee and his or her spouse.
Until the Shares are issued (as evidenced by the appropriate entry on the books
of the Company or of a duly authorized transfer agent of the Company), no right
to vote or receive dividends or any other rights as a shareholder shall exist
with respect to the Shares, notwithstanding the exercise of the Option. The
Company shall issue (or cause to be issued) such Shares promptly after the
Option is exercised. No adjustment will be made for a dividend or other right
for which the record date is prior to the date the Shares are issued, except as
provided in Section 12 of the Plan.
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<PAGE> 7
Exercise of an Option in any manner shall result in a
decrease in the number of Shares thereafter available, both for purposes of the
Plan and for sale under the Option, by the number of Shares as to which the
Option is exercised.
(b) Termination of Relationship as a Service Provider. If an
Optionee ceases to be a Service Provider, such Optionee may exercise his or her
Option within such period of time as is specified in the Option Agreement (of at
least thirty (30) days) to the extent that the Option is vested on the date of
termination (but in no event later than the expiration of the term of the Option
as set forth in the Option Agreement). In the absence of a specified time in the
Option Agreement, the Option shall remain exercisable for three (3) months
following the Optionee's termination. If, on the date of termination, the
Optionee is not vested as to his or her entire Option, the Shares covered by the
unvested portion of the Option shall revert to the Plan. If, after termination,
the Optionee does not exercise his or her Option within the time specified by
the Administrator, the Option shall terminate, and the Shares covered by such
Option shall revert to the Plan.
(c) Disability of Optionee. If an Optionee ceases to be a Service
Provider as a result of the Optionee's Disability, the Optionee may exercise his
or her Option within such period of time as is specified in the Option Agreement
(of at least six (6) months) to the extent the Option is vested on the date of
termination (but in no event later than the expiration of the term of such
Option as set forth in the Option Agreement). In the absence of a specified time
in the Option Agreement, the Option shall remain exercisable for twelve (12)
months following the Optionee's termination. If, on the date of termination, the
Optionee is not vested as to his or her entire Option, the Shares covered by the
unvested portion of the Option shall revert to the Plan. If, after termination,
the Optionee does not exercise his or her Option within the time specified
herein, the Option shall terminate, and the Shares covered by such Option shall
revert to the Plan.
(d) Death of Optionee. If an Optionee dies while a Service
Provider, the Option may be exercised within such period of time as is specified
in the Option Agreement (of at least six (6) months) to the extent that the
Option is vested on the date of death (but in no event later than the expiration
of the term of such Option as set forth in the Option Agreement) by the
Optionee's estate or by a person who acquires the right to exercise the Option
by bequest or inheritance. In the absence of a specified time in the Option
Agreement, the Option shall remain exercisable for twelve (12) months following
the Optionee's termination. If, at the time of death, the Optionee is not vested
as to the entire Option, the Shares covered by the unvested portion of the
Option shall immediately revert to the Plan. If the Option is not so exercised
within the time specified herein, the Option shall terminate, and the Shares
covered by such Option shall revert to the Plan.
(e) Buyout Provisions. The Administrator may at any time offer to
buy out for a payment in cash or Shares, an Option previously granted, based on
such terms and conditions as the Administrator shall establish and communicate
to the Optionee at the time that such offer is made.
10. Non-Transferability of Options and Stock Purchase Rights. The
Options and Stock Purchase Rights may not be sold, pledged, assigned,
hypothecated, transferred, or disposed of in any manner other than by will or by
the laws of descent or distribution and may be exercised, during the lifetime of
the Optionee, only by the Optionee.
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<PAGE> 8
11. Stock Purchase Rights.
(a) Rights to Purchase. Stock Purchase Rights may be issued
either alone, in addition to, or in tandem with other awards granted under the
Plan and/or cash awards made outside of the Plan. After the Administrator
determines that it will offer Stock Purchase Rights under the Plan, it shall
advise the offeree in writing or electronically of the terms, conditions and
restrictions related to the offer, including the number of Shares that such
person shall be entitled to purchase, the price to be paid, and the time within
which such person must accept such offer. The terms of the offer shall comply in
all respects with Section 260.140.42 of Title 10 of the California Code of
Regulations. The offer shall be accepted by execution of a Restricted Stock
purchase agreement in the form determined by the Administrator.
(b) Repurchase Option. Unless the Administrator determines
otherwise, the Restricted Stock purchase agreement shall grant the Company a
repurchase option exercisable upon the voluntary or involuntary termination of
the purchaser's service with the Company for any reason (including death or
disability). The purchase price for Shares repurchased pursuant to the
Restricted Stock purchase agreement shall be the original price paid by the
purchaser and may be paid by cancellation of any indebtedness of the purchaser
to the Company. The repurchase option shall lapse at such rate as the
Administrator may determine. Except with respect to Shares purchased by
Officers, Directors and Consultants, the repurchase option shall in no case
lapse at a rate of less than 20% per year over five (5) years from the date of
purchase.
(c) Other Provisions. The Restricted Stock purchase agreement
shall contain such other terms, provisions and conditions not inconsistent with
the Plan as may be determined by the Administrator in its sole discretion.
(d) Rights as a Shareholder. Once the Stock Purchase Right is
exercised, the purchaser shall have rights equivalent to those of a shareholder
and shall be a shareholder when his or her purchase is entered upon the records
of the duly authorized transfer agent of the Company. No adjustment shall be
made for a dividend or other right for which the record date is prior to the
date the Stock Purchase Right is exercised, except as provided in Section 12 of
the Plan.
12. Adjustments Upon Changes in Capitalization, Merger or Asset Sale.
(a) Changes in Capitalization. Subject to any required action by
the shareholders of the Company, the number of shares of Stock covered by each
outstanding Option or Stock Purchase Right, and the number of shares of Stock
which have been authorized for issuance under the Plan but as to which no
Options or Stock Purchase Rights have yet been granted or which have been
returned to the Plan upon cancellation or expiration of an Option or Stock
Purchase Right, as well as the price per share of Stock covered by each such
outstanding Option or Stock Purchase Right, shall be proportionately adjusted
for any increase or decrease in the number of issued shares of Stock resulting
from a stock split, reverse stock split, stock dividend, combination or
reclassification of the Stock, or any other increase or decrease in the number
of issued shares of Stock effected without receipt of consideration by the
Company. The conversion of any convertible securities of the Company shall not
be deemed to have been "effected without receipt of consideration." Such
adjustment shall be made by the Board, whose determination in that respect shall
be final, binding and conclusive. Except as expressly provided herein, no
issuance by the
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Company of shares of stock of any class, or securities convertible into shares
of stock of any class, shall affect, and no adjustment by reason thereof shall
be made with respect to, the number or price of shares of Stock subject to an
Option or Stock Purchase Right.
(b) Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, the Administrator shall notify each
Optionee as soon as practicable prior to the effective date of such proposed
transaction. The Administrator in its discretion may provide for an Optionee to
have the right to exercise his or her Option or Stock Purchase Right until
fifteen (15) days prior to such transaction as to all of the Optioned Stock
covered thereby, including Shares as to which the Option or Stock Purchase Right
would not otherwise be exercisable. In addition, the Administrator may provide
that any Company repurchase option applicable to any Shares purchased upon
exercise of an Option or Stock Purchase Right shall lapse as to all such Shares,
provided the proposed dissolution or liquidation takes place at the time and in
the manner contemplated. To the extent it has not been previously exercised, an
Option or Stock Purchase Right will terminate immediately prior to the
consummation of such proposed action.
(c) Merger or Asset Sale. In the event of a merger of the Company
with or into another corporation, or the sale of substantially all of the assets
of the Company, each outstanding Option and Stock Purchase Right shall be
assumed or an equivalent option or right substituted by the successor
corporation or a Parent or Subsidiary of the successor corporation. In the event
that the successor corporation refuses to assume or substitute for the Option or
Stock Purchase Right, the Optionee shall fully vest in and have the right to
exercise the Option or Stock Purchase Right as to all of the Optioned Stock,
including Shares as to which it would not otherwise be vested or exercisable. If
an Option or Stock Purchase Right becomes fully vested and exercisable in lieu
of assumption or substitution in the event of a merger or sale of assets, the
Administrator shall notify the Optionee in writing or electronically that the
Option or Stock Purchase Right shall be fully exercisable for a period of
fifteen (15) days from the date of such notice, and the Option or Stock Purchase
Right shall terminate upon the expiration of such period. For the purposes of
this paragraph, the Option or Stock Purchase Right shall be considered assumed
if, following the merger or sale of assets, the option or right confers the
right to purchase or receive, for each Share of Optioned Stock subject to the
Option or Stock Purchase Right immediately prior to the merger or sale of
assets, the consideration (whether stock, cash, or other securities or property)
received in the merger or sale of assets by holders of Stock for each Share held
on the effective date of the transaction (and if holders were offered a choice
of consideration, the type of consideration chosen by the holders of a majority
of the outstanding Shares); provided, however, that if such consideration
received in the merger or sale of assets is not solely Stock of the successor
corporation or its Parent, the Administrator may, with the consent of the
successor corporation, provide for the consideration to be received upon the
exercise of the Option or Stock Purchase Right, for each Share of Optioned Stock
subject to the Option or Stock Purchase Right, to be solely Stock of the
successor corporation or its Parent equal in fair market value to the per share
consideration received by holders of Stock in the merger or sale of assets.
13. Time of Granting Options and Stock Purchase Rights. The date of
grant of an Option or Stock Purchase Right shall, for all purposes, be the date
on which the Administrator makes the determination granting such Option or Stock
Purchase Right, or such other date as is determined by the Administrator. Notice
of the determination shall be given to each Service Provider to whom an Option
or Stock Purchase Right is so granted within a reasonable time after the date of
such grant.
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<PAGE> 10
14. Amendment and Termination of the Plan.
(a) Amendment and Termination. The Board may at any time amend,
alter, suspend or terminate the Plan.
(b) Shareholder Approval. The Board shall obtain shareholder
approval of any Plan amendment to the extent necessary and desirable to comply
with Applicable Laws.
(c) Effect of Amendment or Termination. No amendment, alteration,
suspension or termination of the Plan shall impair the rights of any Optionee,
unless mutually agreed otherwise between the Optionee and the Administrator,
which agreement must be in writing and signed by the Optionee and the Company.
Termination of the Plan shall not affect the Administrator's ability to exercise
the powers granted to it hereunder with respect to Options granted under the
Plan prior to the date of such termination.
15. Conditions Upon Issuance of Shares.
(a) Legal Compliance. Shares shall not be issued pursuant to the
exercise of an Option unless the exercise of such Option and the issuance and
delivery of such Shares shall comply with Applicable Laws and shall be further
subject to the approval of counsel for the Company with respect to such
compliance.
(b) Investment Representations. As a condition to the exercise of
an Option, the Administrator may require the person exercising such Option to
represent and warrant at the time of any such exercise that the Shares are being
purchased only for investment and without any present intention to sell or
distribute such Shares if, in the opinion of counsel for the Company, such a
representation is required.
16. Inability to Obtain Authority. The inability of the Company to
obtain authority from any regulatory body having jurisdiction, which authority
is deemed by the Company's counsel to be necessary to the lawful issuance and
sale of any Shares hereunder, shall relieve the Company of any liability in
respect of the failure to issue or sell such Shares as to which such requisite
authority shall not have been obtained.
17. Reservation of Shares. The Company, during the term of this Plan,
shall at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.
18. Shareholder Approval. The Plan shall be subject to approval by
the shareholders of the Company within twelve (12) months after the date
the Plan is adopted. Such shareholder approval shall be obtained in the
degree and manner required under Applicable Laws.
19. Information to Optionees and Purchasers. The Company shall provide
to each Optionee and to each individual who acquires Shares pursuant to the
Plan, not less frequently than annually during the period such Optionee or
purchaser has one or more Options or Stock Purchase Rights outstanding, and, in
the case of an individual who acquires Shares pursuant to the Plan, during the
period such individual owns such Shares, copies of annual financial statements.
The
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Company shall not be required to provide such statements to key employees whose
duties in connection with the Company assure their access to equivalent
information.
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EXHIBIT 5.1
May 17, 2000
New Focus, Inc.
2630 Walsh Avenue
Santa Clara, California 95051-0905
RE: REGISTRATION STATEMENT ON FORM S-8
Ladies and Gentlemen:
We have examined the Registration Statement on Form S-8 to be filed by you
with the Securities and Exchange Commission on or about May 18, 2000 (the
"Registration Statement") in connection with the registration under the
Securities Act of 1933, as amended (the "Act"), of 2,352,145 shares of your
Common Stock authorized and issued under your 1990 Incentive Stock Option Plan,
746,435 shares of your Common Stock authorized and issued under your 1998 Stock
Plan, 2,289,709 shares of your Common Stock authorized and issued under your
1999 Stock Plan, 1,888,145 shares of your Common Stock issuable under your 2000
Stock Plan, 1,000,000 shares of your Common Stock issuable under your 2000
Employee Stock Purchase Plan and 200,000 shares issuable under your 2000
Director Option Plan. Such shares of Common Stock are referred to herein as the
"Shares" and the 1990 Incentive Stock Option Plan, the 1998 Stock Plan, the 1999
Stock Plan, the 2000 Stock Plan, the 2000 Employee Stock Purchase Plan and the
2000 Director Option Plan are referred to herein as the "Plans." As your counsel
in connection with this transaction, we have examined the proceedings taken and
are familiar with the proceedings proposed to be taken by you in connection with
the issuance and sale of the Shares pursuant to the Plans.
It is our opinion that, upon completion of the actions being taken, or
contemplated by us as your counsel to be taken by you prior to the issuance of
the Shares pursuant to the Registration Statement and the Plans and upon
completion of the actions being taken in order to permit such transactions to be
carried out in accordance with the securities laws of the various states where
required, the Shares will be legally and validly issued, fully-paid and
non-assessable.
We consent to the use of this opinion as an exhibit to the Registration
Statement, and further consent to the use of our name wherever appearing in the
Registration Statement and any amendments thereto.
Very truly yours,
WILSON SONSINI GOODRICH & ROSATI
Professional Corporation
/s/Wilson Sonsini Goodrich & Rosati
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EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement
(Form S-8) pertaining to the 1990 Incentive Stock Option Plan, the 1998 Stock
Plan, the 1999 Stock Plan, the 2000 Stock Plan, the 2000 Employee Stock Purchase
Plan, and the 2000 Director Option Plan, of our report dated February 25, 2000
(except as to Note 12, as which the date is May 8, 2000), with respect to the
consolidated financial statements and schedule of New Focus, Inc. included in
Amendment No. 7 to the Registration Statement (Form S-1 No. 333-31396) and
related Prospectus of New Focus, Inc., filed with the Securities and Exchange
Commission on May 17, 2000.
/s/ Ernst & Young LLP
San Jose, California
May 17, 2000
